[Federal Register Volume 77, Number 213 (Friday, November 2, 2012)]
[Notices]
[Pages 66194-66196]
[FR Doc No: 2012-26853]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-68110; File No. SR-CBOE-2012-099]

Self-Regulatory Organizations; Chicago Board Options Exchange,
Incorporated; Notice of Filing and Immediate Effectiveness of a
Proposed Rule Change To Make Technical Change to SPY Position Limit
Pilot Program and Representation Regarding Timing of Submission of
Pilot Report

October 26, 2012.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(the ``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given
that on October 17, 2012, the Chicago Board Options Exchange,
Incorporated (the ``Exchange'' or ``CBOE'') filed with the Securities
and Exchange Commission (the ``Commission'') the proposed rule change
as described in Items I and II below, which Items have been prepared by
the Exchange. The Exchange filed the proposal as a ``non-
controversial'' proposed rule change pursuant to Section
19(b)(3)(A)(iii) of the Act \3\ and Rule 19b-4(f)(6) thereunder.\4\ The
Commission is publishing this notice to solicit comments on the
proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \4\ 17 CFR 240.19b-4(f)(6).
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

    CBOE proposes to make a technical amendment to Interpretation and
Policy

.07 to Rule 4.11 to insert the specific expiration date for a pilot
program that eliminates position and exercise limits for physically-
settled options on the SPDR S&P 500 ETF Trust (``SPY''). The Exchange
is also making a clarifying representation regarding the timing of when
the pilot report will be submitted to the Commission. The text of the
proposed rule change is available on the Exchange's Web site (http://www.cboe.org/legal), at the Exchange's Office of the Secretary, and at
the Commission's Public Reference Room.

II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, the self-regulatory organization
included statements concerning the purpose of and basis for the
proposed rule change and discussed any comments it received on the
proposed rule change. The text of those statements may be examined at
the places specified in Item IV below. The Exchange has prepared
summaries, set forth in sections A, B, and C below, of the most
significant parts of such statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The Commission recently noticed the Exchange's proposal to amend
Interpretation and Policy .07 to Rule 4.11 to eliminate position and
exercise limits for physically-settled SPY options purpose to a pilot
program (``Program'').\5\ This rule change proposes to amend the text
of Interpretation and Policy .07 to Rule 4.11 to insert the specific
conclusion date of the Program, which is November 27, 2013.
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    \5\ See Securities Exchange Act Release No. 67937 (September 27,
2012) (Notice of Filing and Immediate Effectiveness of Proposed Rule
to Eliminate Position and Exercise Limits for Physically-Settled SPY
Options on a Pilot Basis) (SR-CBOE-2012-091).
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    In addition, in the filing to establish the Program, CBOE committed
to perform an analysis of the Program after the first twelve (12)
months of the pilot program (the ``Pilot Report'').\6\ In connection
with that commitment, CBOE represents that it will submit the Pilot
Report to the Commission at least 30 days prior to the expiration date
of the Program.
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    \6\ The Pilot Report will detail the size and different types of
strategies employed with respect to positions established as a
result of the elimination of position limits in SPY. In addition,
the report will note whether any problems resulted due to the no
limit approach and any other information that may be useful in
evaluating the effectiveness of the Program. The Pilot Report will
compare the impact of the Program, if any, on the volumes of SPY
options and the volatility in the price of the underlying SPY
shares, particularly at expiration. In preparing the report the
Exchange will utilize various data elements such as volume and open
interest. In addition the Exchange will make available to Commission
staff data elements relating to the effectiveness of the pilot
program
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2. Statutory Basis
    The basis under the Securities Exchange Act of 1934 (the ``Act'')
for this proposed rule change is the requirement under Section
6(b)(5)\7\ that an exchange have rules that are designed to promote
just and equitable principles of trade, and to remove impediments to
and perfect the mechanism for a free and open market and a national
market system, and, in general, to protect investors and the public
interest. In particular, the proposed rule change seeks to update rule
text to insert the specific conclusion date for the Program in a manner
that is consistent with the Commission's notice of the Program. In
addition, the representation that the Exchange will submit the Pilot
Report to the Commission at least 30 days prior to the expiration date
of the Program clarifies the administration of the Program by the
Exchange.
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    \7\ 15 U.S.C. 78f(b)(5).
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B. Self-Regulatory Organization's Statement on Burden on Competition

    CBOE does not believe that the proposed rule change will impose any
burden on competition that is not necessary or appropriate in
furtherance of the purposes of the Act.

C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others

    No written comments were solicited or received with respect to the
proposed rule change.

III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action

    Because the proposed rule change does not: (i) Significantly affect
the protection of investors or the public interest; (ii) impose any
significant burden on competition; and (iii) become operative prior to
30 days from the date on which it was filed, or such shorter time as
the Commission may designate, the proposed rule change has become
effective pursuant to Section 19(b)(3)(A) of the Act \8\ and Rule 19b-
4(f)(6) thereunder.\9\
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    \8\ 15 U.S.C. 78s(b)(3)(A).
    \9\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)
requires a self-regulatory organization to give the Commission
written notice of its intent to file the proposed rule change, along
with a brief description and text of the proposed rule change, at
least five business days prior to the date of filing of the proposed
rule change, or such shorter time as designated by the Commission.
The Exchange has satisfied this requirement.
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    A proposed rule change filed pursuant to Rule 19b-4(f)(6) under the
Act \10\ normally does not become operative for 30 days after the date
of its filing. However, Rule 19b-4(f)(6) \11\ permits the Commission to
designate a shorter time if such action is consistent with the
protection of investors and the public interest. The Exchange has asked
the Commission to waive the 30-day operative delay, noting that doing
so will permit the text of the Exchange's rules to reflect the
expiration date of the Program as soon as possible in order to
eliminate any potential confusion. The Commission believes that waiving
the 30-day operative delay is consistent with the protection of
investors and the public interest. Therefore, the Commission hereby
waives the 30-day operative delay and designates the proposal operative
upon filing.\12\
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    \10\ 17 CFR 240.19b-4(f)(6).
    \11\ 17 CFR 240.19b-4(f)(6).
    \12\ For purposes only of waiving the 30-day operative delay,
the Commission has considered the proposed rule's impact on
efficiency, competition, and capital formation. See 15 U.S.C.
78c(f).
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    At any time within 60 days of the filing of the proposed rule
change, the Commission summarily may temporarily suspend such rule
change if it appears to the Commission that such action is necessary or
appropriate in the public interest, for the protection of investors, or
otherwise in furtherance of the purposes of the Act.

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to<EMAIL_ADDRESS>Please include
File Number SR-CBOE-2012-099 on the subject line.

Paper Comments

     Send paper comments in triplicate to Elizabeth M. Murphy,
Secretary,

Securities and Exchange Commission, 100 F Street NE., Washington, DC
20549-1090.

All submissions should refer to File Number SR-CBOE-2012-099. This file
number should be included on the subject line if email is used. To help
the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all
written statements with respect to the proposed rule change that are
filed with the Commission, and all written communications relating to
the proposed rule change between the Commission and any person, other
than those that may be withheld from the public in accordance with the
provisions of 5 U.S.C. 552, will be available for Web site viewing and
printing in the Commission's Public Reference Room, 100 F Street NE.,
Washington, DC 20549, on official business days between the hours of
10:00 a.m. and 3:00 p.m. Copies of the filing also will be available
for inspection and copying at the principal office of the Exchange. All
comments received will be posted without change; the Commission does
not edit personal identifying information from submissions. You should
submit only information that you wish to make available publicly.
    All submissions should refer to File Number SR-CBOE-2012-099 and
should be submitted on or before November 23, 2012.
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    \13\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\13\
Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2012-26853 Filed 11-1-12; 8:45 am]
BILLING CODE 8011-01-P


ENCLOSURE 1

COMMONWEALTH OF VIRGINIA

STATE AIR POLLUTION CONTROL BOARD

REGULATIONS FOR THE CONTROL AND ABATEMENT OF AIR POLLUTION

PROVISIONS AFFECTED

REVISION F06c [D08]

CONCERNING

AMBIENT AIR QUALITY STANDARDS

(9VAC5 CHAPTER 30)

Adoption Date:  December 15, 2008

Effective Date:  March 18, 2009

The following table lists the specific provisions of the attached regulations that will be used to implement the State Implementation Plan (SIP).  Highlighted provisions are included for information purposes only for this specific revision, and will be submitted as a revision to the Commonwealth's SIP in a separate submittal (Revision D08).  A copy of the actual regulation submitted for approval and incorporation by reference into the Virginia SIP is included in Enclosure 2.

CHAPTER 20	GENERAL PROVISIONS

PART I		Administrative

9VAC5-20-21	Documents incorporated by reference (modified)

CHAPTER 30	AMBIENT AIR QUALITY STANDARDS

9VAC5-30-55	Ozone (8-hour, 0.08 ppm) (modified)

9VAC5-30-56	Ozone (8-hour, 0.075 ppm) (added)

9VAC5-30-65	Particulate matter (PM2.5) (modified)

TEMPLATES\SIP-REG\REG01

SIP\NONATTN PLANS\2010\F06c-SIP-1.DOC


[Federal Register Volume 78, Number 16 (Thursday, January 24, 2013)]
[Notices]
[Page 5176]
[FR Doc No: 2013-01371]

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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

[Docket No. ER13-764-000]

CED White River Solar, LLC; Supplemental Notice That Initial
Market-Based Rate Filing Includes Request for Blanket Section 204
Authorization

    This is a supplemental notice in the above-referenced proceeding,
of CED White River Solar, LLC's application for market-based rate
authority, with an accompanying rate schedule, noting that such
application includes a request for blanket authorization, under 18 CFR
part 34, of future issuances of securities and assumptions of
liability.
    Any person desiring to intervene or to protest should file with the
Federal Energy Regulatory Commission, 888 First Street NE., Washington,
DC 20426, in accordance with Rules 211 and 214 of the Commission's
Rules of Practice and Procedure (18 CFR 385.211 and 385.214). Anyone
filing a motion to intervene or protest must serve a copy of that
document on the Applicant.
    Notice is hereby given that the deadline for filing protests with
regard to the applicant's request for blanket authorization, under 18
CFR part 34, of future issuances of securities and assumptions of
liability is February 4, 2013.
    The Commission encourages electronic submission of protests and
interventions in lieu of paper, using the FERC Online links at http://www.ferc.gov. To facilitate electronic service, persons with Internet
access who will eFile a document and/or be listed as a contact for an
intervenor must create and validate an eRegistration account using the
eRegistration link. Select the eFiling link to log on and submit the
intervention or protests.
    Persons unable to file electronically should submit an original and
14 copies of the intervention or protest to the Federal Energy
Regulatory Commission, 888 First Street NE., Washington, DC 20426.
    The filings in the above-referenced proceeding(s) are accessible in
the Commission's eLibrary system by clicking on the appropriate link in
the above list. They are also available for review in the Commission's
Public Reference Room in Washington, DC. There is an eSubscription link
on the web site that enables subscribers to receive email notification
when a document is added to a subscribed docket(s). For assistance with
any FERC Online service, please email<EMAIL_ADDRESS>or
call<PHONE_NUMBER> (toll free). For TTY, call<PHONE_NUMBER>.

    Dated: January 15, 2013.
Nathaniel J. Davis, Sr.,
Deputy Secretary.
[FR Doc. 2013-01371 Filed 1-23-13; 8:45 am]
BILLING CODE 6717-01-P


[Federal Register Volume 84, Number 246 (Monday, December 23, 2019)]
[Notices]
[Pages 70584-70589]
[FR Doc No: 2019-27587]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-87771; File No. SR-ICEEU-2019-019]

Self-Regulatory Organizations; ICE Clear Europe Limited; Notice
of Filing of Proposed Rule Change Relating to the ICE Clear Europe
Collateral and Haircut Policy and Collateral and Haircut Procedures

December 17, 2019.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that
on December 4, 2019, ICE Clear Europe Limited (``ICE Clear Europe'' or
the ``Clearing House'') filed with the Securities and Exchange
Commission (``Commission'') the proposed rule changes described in
Items I, II, and III below, which Items have been prepared primarily by
ICE Clear Europe. The Commission is publishing this notice to solicit
comments on the proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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I. Clearing Agency's Statement of the Terms of Substance of the
Proposed Rule Change

    ICE Clear Europe proposes to adopt a new Collateral and Haircut
Policy (the ``Revised Policy'') to replace the existing Collateral and
Haircut Policy (the ``Existing Policy'') and to adopt new Collateral
and Haircut Procedures (the ``Collateral Procedures''). The revisions
would not involve any changes to the ICE Clear Europe Clearing Rules or
Procedures.\3\
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    \3\ Capitalized terms used but not defined herein have the
meanings specified in the ICE Clear Europe Clearing Rules (the
``Rules'').
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II. Clearing Agency's Statement of the Purpose of, and Statutory Basis
for, the Proposed Rule Change

    In its filing with the Commission, ICE Clear Europe included
statements concerning the purpose of and basis for the proposed rule
change and discussed any comments it received on the proposed rule
change. The text of these statements may be examined at the places
specified in Item IV below. ICE

Clear Europe has prepared summaries, set forth in sections (A), (B),
and (C) below, of the most significant aspects of such statements.

(A) Clearing Agency's Statement of the Purpose of, and Statutory Basis
for, the Proposed Rule Change

(a) Purpose
    ICE Clear Europe is proposing to adopt the Revised Policy and new
Collateral Procedures. Together, the Revised Policy and Collateral
Procedures would supersede the Existing Policy, which would be retired.
The new documents would provide certain clarifications and better
separate policy-level documentation and implementation-level
documentation, such that high-level policy details would be in the
Revised Policy and supporting detail for the Revised Policy would be
contained in the new Collateral Procedures. Accordingly, relevant parts
of the Existing Policy would be split between the Revised Policy and
the Collateral Procedures. The amendments also remove certain
operational details in the Existing Policy which ICE Clear Europe has
determined are not needed in the Revised Policy and Collateral
Procedures. Nonetheless, ICE Clear Europe does not expect that the new
documentation would itself result in material changes to its underlying
haircut model, or to the eligible collateral, haircuts and
concentration limitations that the Clearing House currently imposes.
Collateral and Haircut Policy
    The Revised Policy would set out the Clearing House's overall
approach to defining the types, amounts and composition of cash and
non-cash collateral that ICE Clear Europe accepts from Clearing Members
(``CMs'') to cover their guaranty fund and margin requirements
(referred to generally as ``collateral''). The Revised Policy would set
out the Clearing House overall goal of mitigating price risk it may
face when liquidating collateral of a defaulting CM by: (i) Setting and
enforcing a list of acceptable collateral (also referred to as
``Permitted Cover''); (ii) setting and applying risk-based haircuts to
the value of the collateral (``Haircuts''); (iii) setting and enforcing
concentration limits on the amount of collateral a CM may post, to
provide diversification of the collateral pool (``Concentration
Limits''); and (iv) ensuring Permitted Cover, Haircuts and
Concentration Limits are aligned to the Clearing House's risk appetite
and compliant with applicable legal and regulatory requirements.
    The Revised Policy would set out overall requirements that
Permitted Cover assets: (i) Are highly liquid with low credit and
market risk; (ii) are priced in an Eligible Currency; and (iii) entail
risks limited to those that ICE Clear Europe is able to identify,
measure, monitor and mitigate. (The specific list of Permitted Cover
would not be contained in the Revised Policy itself but would continue
to be available on the ICE Clear Europe website.)
    The Revised Policy would set overall requirements that Haircuts
would be based on a model that includes: (i) The creditworthiness of
the issuer; (ii) the asset's market risk and liquidity risk; and (iii)
market conditions and volatility. Certain further details relating to
Haircuts (including the determination of minimum haircuts) would be
specified in the Collateral Procedures, or in related model
documentation. The Revised Policy would also establish the general
principal that wrong way risk (``WWR'') with respect to posting of
collateral (i.e., the risk that the value of a particular CM's
collateral is likely to decline at the same time the Clearing House's
risk to the CM increases) would be mitigated through member-specific
restrictions and actions rather than Haircuts.
    The Revised Policy would address the overall framework for setting
CM Concentration Limits. It would provide that ICE Clear Europe may
limit (i) the absolute amount of each type of collateral that CMs may
lodge to minimize concentration and enable liquidity and (ii) the
relative amount of each collateral type in a CM's collateral portfolio
to prevent overexposure to price movements in individual asset classes.
Collateral exceeding Concentration Limits would not count towards a
CM's total margin requirements. As discussed below, details regarding
collateral management, data and reporting and legal review of
enforceability of collateral found in the Existing Policy would be
split across the Revised Policy, Collateral Procedures, ICE Clear
Europe Collateral and Haircut Schedule of Parameters and Reviews (the
``Parameters'') and the Model Documentation for the ICE Clear Europe
Collateral Haircut Model (the ``Model''). Where details are included in
other Clearing House policies, procedures and documentation, such as
the Treasury & Banking Services Policy, Investment Management Policy,
F&O Risk Policy, Document Governance Schedule and Risk Appetite
Framework, to avoid duplication, they would not be covered in the
Revised Policy.
    The Revised Policy would describe overall arrangements for policy
governance, reviews and exception handling. Pursuant to the Revised
Policy, the document owner would be responsible for ensuring that it
remains up-to-date and appropriately reviewed and would report material
breaches and deviations to their Head of Department, the Chief Risk
Officer and the Head of Compliance (or their delegates), who together
would then consider further escalation to relevant senior executives,
the Board and/or competent authorities. Exceptions to the Revised
Policy would be approved in accordance with applicable governance
processes.
Collateral and Haircut Procedures
    The new Collateral Procedures would set out the application of the
Revised Policy through describing the operational activities and
related governance processes for Permitted Cover, Haircuts and
Concentration Limits. Certain details contained in the Existing Policy
have been incorporated in the Collateral Procedures, rather than the
Revised Policy, as discussed herein.
Permitted Cover
    The Collateral Procedures would provide more detail regarding
requirements relating to Permitted Cover. These requirements are
generally consistent with the Existing Policy, and ICE Clear Europe
does not expect that the adoption of the new Collateral Procedures
would result in a change in the list of Eligible Permitted Cover. The
Collateral Procedures would apply the following general eligibility
criteria to Permitted Cover:
     The assets must be highly liquid with an active sale or
repurchase agreement market with a diverse group of buyers and sellers;
     The market for the assets must have sufficient price
history to permit ICE Clear Europe to analyze the statistical returns
of the assets;
     The assets must be capable of daily revaluation and must
be quoted intraday by financial market news information providers;
     ICE Clear Europe must be capable of managing the assets
operationally; and
     The assets must be in an Eligible Currency.
    Where the asset is a financial instrument, generally the following
additional criteria would apply:
     The asset must be a vanilla form of that instrument;
     The asset must have low credit risk and low market risk,
based on ICE Clear Europe's internal assessment based on credit and
bond yield and CDS spread relative to the maximum set by ICE Clear
Europe and

     The asset must be freely transferable and without any
regulatory or legal constraint or third party claims that impair
liquidation;
     The asset must not be issued by a CM, or an affiliate of a
CM; and
     The asset must not be issued by a central clearing
counterparty or entity providing services critical to the functioning
of ICE Clear Europe (unless it is a central bank in the European
Economic Area or that issues a currency in which ICE Clear Europe has
exposures).
    Where the asset is gold, one of the following additional criteria
would apply:
     It must be owned as allocated gold (where ICE Clear Europe
directly holds an interest in specific bars of gold); or
     It must be owned as unallocated gold (where ICE Clear
Europe holds an interest in a pool of gold bars) through a firm with
low credit risk based on ICE Clear Europe's own assessment.
    The eligibility criteria described above, combined with the
description of the concentration limits, basis for haircuts and steps
to mitigate price risk set out in the Revised Policy, are consistent
with the general principles for accepting Permitted Cover set out in
the Existing Policy, other than the sovereign rating model criteria.
The sovereign rating model has been retired by ICE Clear Europe and
instead, the Procedures and related Parameters address sovereign
quality. The elements related to sovereign rating are the same in the
Existing Policy and in the new Collateral Procedures and Parameters.
    Consistent with current practice, letters of credit and bank
guarantees would not be eligible as Permitted Cover. Certain additional
details and parameters would be set out in an annex to the Procedure or
in the List of Permitted Cover, which is an operational document that
is published on the ice.com website.\4\ Unlike the Existing Policy, the
Collateral Procedures would not have a section specifically addressing
restrictions on Guaranty Fund collateral as this is already be
addressed in the Finance Procedures and List of Permitted Cover.
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    \4\ Available at: https://www.theice.com/publicdocs/clear_europe/list-of-permitted-covers.pdf.
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Haircuts
    Pursuant to the proposed Collateral Procedures, ICE Clear Europe
would continue to apply conservative haircuts to Permitted Cover to
ensure that, even in stressed market conditions, the collateral could
be liquidated at least at the value of the requirement it would be used
to cover, and would also continue to apply cross-currency haircuts to
mitigate foreign exchange risk where the currency applicable to the
collateral would be different from the currency of the requirements it
would be covering.
    ICE Clear Europe would determine Haircuts using a combination of a
model, analytical tools and/or qualitative overlays. The model would be
described in the collateral and haircut model documentation and related
parameters maintained by the Clearing House and be back-tested
periodically. Consistent with the existing model, Haircuts would
further be based on a number of factors, including, but not limited to:
     A credit assessment of the issuer;
     The maturity of the asset;
     Historical and current market conditions and volatility;
     Stressed market conditions, including both historical and
forward looking (hypothetical) scenarios based on macroeconomic or
political events;
     Expectations of future volatility;
     The liquidity of the underlying market, including bid/ask
spreads; and
     Any other factors that may affect the liquidity or the
value of the asset in stressed market conditions.
    These factors are substantially the same as those set out in the
Existing Policy, other than the wrong way risk factor, which is
addressed through an operational report, and as noted above is
addressed through CM-specific measures rather than Haircuts. The
Haircuts would be subject to minimum values which would be addressed in
the Parameters, instead of the Revised Policy or Collateral Procedures,
and the final Haircut value would be rounded up to the nearest
``Haircut Rounding Interval''. Certain additional requirements relating
to Haircuts on bonds and gold bullion, as well as collateral pricing,
which are currently addressed in the Existing Policy, would be removed
from the Existing Policy as they are already addressed, and will
continue to be addressed, in the Model and the Parameters. Other
aspects of the haircut calculation methodology would also move to the
related collateral haircut model documentation. The list of data used
in collateral pricing that is currently set out in the Existing Policy
would instead be set out in the Parameters. The description of
exceptions would be set out in Clearing House operational
documentation.
    Consistent with the Existing Policy, the Collateral Procedures
would call for ICE Clear Europe to limit the likelihood of procyclical
impact from Haircuts as issuer creditworthiness deteriorates and
haircuts increase by:
     Applying a conservative minimum haircut level to all
collateral types, regardless of issuer and tenor;
     Including stressed market conditions in the Haircuts;
     Pre-emptively identifying and incorporating potential
future events into the Haircuts via the qualitative overlays and
analytical tools; and
     Providing advance notice of changes in haircuts to CMs and
competent authorities, where practicable.
Concentration Limits
    The approach to Concentration Limits contained in the proposed
Collateral Procedures would be substantially similar to the Existing
Policy. However, certain details regarding the collateral breakdown
report currently in the Existing Policy would not be included in the
Collateral Procedures (as they are inconsistent with the level of
detail in the Collateral Procedures generally) but would instead be set
out in operational documentation. The report itself, which details how
collateral values are produced at an operational level, will continue
to be produced as part of the normal reporting cycle. As under current
practice, ICE Clear Europe would be able to set Absolute Limits and
Relative Limits.
    With respect to the absolute amount of each type of collateral that
can be accepted from a CM (``Absolute Limits''), the Collateral
Procedures would set the framework for how this level is set. ICE Clear
Europe would limit the absolute amount of each type of collateral such
that if two CM groups were to default, ICE Clear Europe's total
holdings of a particular type of collateral (across all of ICE Clear
Europe's markets) could be liquidated with minimal impact on prices. As
compared to the Existing Policy, the Collateral Procedures would
clarify that all markets cleared by ICE Clear Europe would be included
in the calculation methodology for Absolute Limits. The description of
the Absolute Limits in the Collateral Procedures would otherwise
generally be consistent with the description of the Absolute Limits set
out in the Existing Policy, including the description of the
calculation of Absolute Limits for bonds lodged as Permitted Cover.
    The Absolute Limits would be set as a percentage of the Daily
Traded Volume, which is an average market volume for each asset and
converted from the reported currency to the currency of the asset
(where required) using the previous end of day foreign exchange rate.
The Absolute Limits could be adjusted based on certain

qualitative considerations and must be approved by senior management.
Absolute Limits would be specified in the currency of the issuer, based
on the market values of the collateral, and apply at a CM group level.
Unlike the Existing Policy, the Collateral Procedures would not take
into account ICE Clear Europe's committed repo facility as a basis for
allowing Clearing Members to exceed otherwise applicable Absolute
Limits.
    With respect to the relative amount of each type of collateral
within a CM's collateral portfolio (``Relative Limits''), the
Collateral Procedures would describe the general framework for setting
these limits, which would be set so that an individual CM's collateral
portfolios would be balanced between different assets based on a
qualitative assessment of the different types of collateral, taking
into account factors such as the types of issuers, issuer credit risk
and collateral liquidity and price volatility. The Relative Limits
would be based on the post-haircut value of the collateral applied at
the individual CM level.
Further Restrictions
    Pursuant to the proposed Collateral Procedures, and consistent with
current practice, ICE Clear Europe would apply additional restrictions
and measures with respect to collateral as follows:
     Reducing Absolute Limits once the CDS spread of the issuer
breaches pre-defined levels;
     analyzing CMs' non-cash collateral to identify WWR daily
and where ICE Clear Europe identifies material WWR, requiring the CM to
take mitigating actions, such as substituting the lodged Permitted
Cover with alternative Permitted Cover; and
     not placing Concentration Limits on certain Permitted
Cover because of the liquidity of the asset's market, its behavior
under stress and wider risk management considerations.

The Collateral Procedures would address cross clearing house
concentration limits consistently with the manner in which they are
addressed in the Existing Policy
Data Management
    Consistent with existing practice, the sources of data used for
collateral valuation and for Haircuts and Concentration Limits would be
approved and reviewed periodically at a senior level, though data could
be excluded or corrected without senior approval to correct stale or
incorrect prices where reliable updated values have been supplied or to
exclude data in the observation period for the Absolute Limits credit
risk percentage reduction if it is unduly volatile due to low trading
volumes. The list of exclusions and corrections and related
justifications would be reviewed periodically. ICE Clear Europe would
monitor the end of day and intraday market data that it uses to value
collateral against thresholds to ensure that the data is not `stale',
investigate breaches of these thresholds and take action to resolve
them.
    The existing F&O Risk Procedures covers all aspects of collateral
requirements and collateral valuation (and provides for issuance of
margin calls accordingly). Therefore data and reporting requirements
for valuation purposes have been removed from the Revised Policy as the
content is covered in the Intraday Shortfall section of the F&O Risk
Procedures. In addition, the formula for collateral valuation is
publicly available on the ICE Clear Europe website.\5\ The scope of the
collateral documentation is limited to setting collateral haircuts and
limits, and monitoring them against market performance.
---------------------------------------------------------------------------

    \5\ Available at: https://www.theice.com/clear-europe/treasury-and-banking.
---------------------------------------------------------------------------

Daily Monitoring
    Pursuant to the proposed Collateral Procedures, ICE Clear Europe
would continue daily monitoring processes to ensure the eligibility of
the list of Permitted Cover, to ensure the adequacy of Haircuts and to
enforce the Concentration Limits. ICE Clear Europe would monitor: (i)
Publically available sources for information affecting the eligibility
of collateral on the list of Permitted Cover; (ii) the adequacy of its
Haircuts daily, in near real time, by comparing each asset's price
movement since the previous day to the Haircut for that asset; and
(iii) collateral against the Concentration Limits, which, in the case
of a breach, would require the collateral to be replaced with
alternative Permitted Cover or allow ICE Clear Europe to call for
additional margin. Certain provisions of the Existing Policy relating
to intraday valuation of collateral and the description of collateral
composition reporting would not be included in the Collateral
Procedures, as the topic is already covered in the F&O Risk Procedures,
which describe the valuation methodology of collateral and the related
monitoring undertaken through the margin call process. The CDS Risk
Procedures will be updated as part of the Policy and Procedures
documentation review cycle to align with the F&O Risk Procedures with
respect to this matter.
    Certain details under Data and Reporting in the Existing Policy
concerning the reports that are available to various stakeholders in
the form of periodic Collateral Reports, will not be included in the
Revised Policy or Collateral Procedures. In ICE Clear Europe's view,
these reports have evolved since the adoption of the Existing Policy,
and in order to facilitate their continued development ICE Clear Europe
does not believe they should be specified in detail in Clearing House
procedures. Internal tools instead would describe how the reports would
be built in greater detail and may be adjusted over time, without
affecting the Revised Policy or Collateral Procedures. The back testing
of the haircut parameters currently set out in the Existing Policy
would be instead set out in the Parameters (and the substance of those
parameters is not proposed to be changed). The description of the Risk
Committee collateral reporting would be governed through the Terms of
Reference for committees instead of through the Revised Policy or
Collateral Procedures (and is not otherwise proposed to be changed).
Governance
    Governance relating to Permitted Cover, collateral and Haircuts
would generally remain the same as in the Existing Policy, though the
Collateral Procedures would add that competent authorities would be
notified of any material breaches. Pursuant to the proposed Collateral
Procedures, proposals to add, remove, change or set Permitted Cover,
Haircuts or Concentration Limits would also reviewed at a senior level
and existing levels would be reviewed at least monthly, but could also
be reviewed and changed ad hoc if needed. Amendments would be published
by circular in advance of taking effect (where practicable) to CMs and
relevant competent authorities.
    The governance requirements relating to reviews, breach management
and exception handling would be the same as those under the Revised
Policy.
    Requirements under the Existing Policy relating to independent
validation and policy review are covered in the Model Risk Governance
Framework and Documentation Governance Schedule, and would not be
addressed in the Revised Policy or Collateral Procedures.
Other Existing Policy Matters
    A number of additional details currently set out in the Existing
Policy

would be removed and addressed in documentation other than the Revised
Policy or Collateral Procedures. Collateral management would be set out
in the Treasury and Banking Services Policy and the Investment
Management Procedures. The monitoring schedule would be set out in the
Parameters. The description of the legal review of enforceability of
collateral that was set out in the Existing Policy is generally
considered to be business as usual work for the legal team and would no
longer be covered through policies.
(b) Statutory Basis
    ICE Clear Europe believes that the changes described herein are
consistent with the requirements of Section 17A of the Act \6\ and the
regulations thereunder applicable to it. Section 17A(b)(3)(F) of the
Act \7\ in particular requires, among other things, that the rules of
the clearing agency be designed to promote the prompt and accurate
clearance and settlement of securities transactions and, to the extent
applicable, derivative agreements, contracts and transactions, to
assure the safeguarding of securities and funds in the custody or
control of the clearing agency or for which it is responsible and, in
general, protect investors and the public interest. Through ensuring
that liquidity risks associated with the collateral it collects are
managed and minimized through clear policies and procedures, the
amendments would promote ICE Clear Europe's ability to ensure prompt
and accurate clearing and settlement of transactions in the event that
it becomes necessary for ICE Clear Europe to use or liquidate
collateral collected from CMs. As discussed above, ICE Clear Europe
does not expect the amendments, as an initial matter, to change its
list of Permitted Cover, Haircuts or Concentration Limits, but rather
to clarify and simplify the policies and procedures under which such
measures are currently determined and applied. Enhancing management of
its collateral liquidation risks in this way also generally enhances
the stability of the Clearing House and therefore ICE Clear Europe's
ability to safeguard securities and funds in its custody and control
and generally better protects investors and the public interest, within
the meaning of Section 17A(b)(3)(F).
---------------------------------------------------------------------------

    \6\ 15 U.S.C. 78q-1.
    \7\ 15 U.S.C. 78q-1(b)(3)(F).
---------------------------------------------------------------------------

    Rule 17Ad-22(e)(3)(i) \8\ requires clearing agencies to maintain a
sound risk management framework that identifies, measures, monitors and
manages the range of risks that it faces. The new Revised Policy and
Collateral Procedures (the ``Documents'') are intended to clearly
describe the manner in which ICE Clear Europe mitigates collateral
price and liquidation risk through setting acceptable Permitted Cover,
Haircuts and Concentration Limits and monitoring these measures and
managing any deviations or related issues. Further, in compliance with
Rule 17 Ad-22(e)(5),\9\ the Documents clearly describe (i) the manner
in which ICE Clear Europe would set eligibility criteria for Permitted
Cover to limit the assets it accepts as collateral to those with low
liquidity and market risks, (ii) the basis on which it would set
Haircuts and Concentration Limits to ensure that they are sufficiently
conservative, and (iii) the requirement that Haircuts and Concentration
Limits be reviewed at least monthly at a senior level.
---------------------------------------------------------------------------

    \8\ 17 CFR 240.17 Ad-22(e)(3)(i). The rule states that: ``[e]ach
covered clearing agency shall establish, implement, maintain and
enforce written policies and procedures reasonably designed to, as
applicable: (3) Maintain a sound risk management framework for
comprehensively managing legal, credit, liquidity, operational,
general business, investment, custody, and other risks that arise in
or are borne by the covered clearing agency, which:
    (i) Includes risk management policies, procedures, and systems
designed to identify, measure, monitor, and manage the range of
risks that arise in or are borne by the covered clearing agency,
that are subject to review on a specified periodic basis and
approved by the board of directors annually;''
    \9\ 17 CFR 240.17 Ad-22(e)(5). The rule states that: ``[e]ach
covered clearing agency shall establish, implement, maintain and
enforce written policies and procedures reasonably designed to, as
applicable: (5) Limit the assets it accepts as collateral to those
with low credit, liquidity, and market risks, and set and enforce
appropriately conservative haircuts and concentration limits if the
covered clearing agency requires collateral to manage its or its
participants' credit exposure; and require a review of the
sufficiency of its collateral haircuts and concentration limits to
be performed not less than annually;''
---------------------------------------------------------------------------

    Rule 17Ad-22(e)(2) \10\ requires clearing agencies to establish
reasonably designed policies and procedures to provide for governance
arrangements that are clear and transparent and specify clear and
direct lines of responsibility. To facilitate compliance with this
requirement, the proposed Documents more clearly define the roles and
responsibilities of the document owner, and their Head of Department,
the Chief Risk Officer and the Head of Compliance. The Collateral
Procedures also set out the role of senior personnel in reviewing
Haircuts, Concentration Limits and Permitted Cover.
---------------------------------------------------------------------------

    \10\ 17 CFR 240.17 Ad-22(e)(2). The rule states that ``[e]ach
covered clearing agency shall establish, implement, maintain and
enforce written policies and procedures reasonably designed to, as
applicable: (2) Provide for governance arrangements that:
    (i)Are clear and transparent
    (ii) Clearly prioritize the safety and efficiency of the covered
clearing agency;
    (iii) Support the public interest requirements in Section 17A of
the Act (15 U.S.C. 78q-1) applicable to clearing agencies, and the
objectives of owners and participants;
    (iv) Establish that the board of directors and senior management
have appropriate experience and skills to discharge their duties and
responsibilities;
    (v) Specify clear and direct lines of responsibility; and
    (vi) Consider the interests of participants' customers,
securities issuers and holders, and other relevant stakeholders of
the covered clearing agency.''''
---------------------------------------------------------------------------

(B) Clearing Agency's Statement on Burden on Competition

    ICE Clear Europe does not believe the proposed rule changes would
have any impact, or impose any burden, on competition not necessary or
appropriate in furtherance of the purpose of the Act. As an initial
matter, ICE Clear Europe does not anticipate that the amendments would
in themselves result in a change to the list of Permitted Cover or the
Haircuts or Concentration Limits. Rather, the amendments are intended
to clarify the documentation of the relevant policies and procedures
that are currently in effect. The amendments apply to all Contracts and
are intended to strengthen risk management relating to these products
primarily through providing greater clarity. ICE Clear Europe does not
believe the amendments would have any direct effect on Clearing
Members, other market participants or the market for cleared products
generally. As a result, ICE Clear Europe does not believe the
amendments would materially affect the cost of, or access to, clearing.
Therefore, ICE Clear Europe does not believe the proposed rule changes
impose any burden on competition that is not appropriate in furtherance
of the purposes of the Act.

(C) Clearing Agency's Statement on Comments on the Proposed Rule Change
Received From Members, Participants or Others

    Written comments relating to the proposed rule changes have not
been solicited or received. ICE Clear Europe will notify the Commission
of any written comments received by ICE Clear Europe.

III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action

    Within 45 days of the date of publication of this notice in the
Federal Register or within such longer period up to 90 days (i) as the
Commission may designate if it finds such longer period to be
appropriate and publishes its reasons for so finding or (ii) as to
which

the self-regulatory organization consents, the Commission will:
    (A) By order approve or disapprove the proposed rule change or
    (B) institute proceedings to determine whether the proposed rule
change should be disapproved.
    The proposal shall not take effect until all regulatory actions
required with respect to the proposal are completed.

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether the proposed rule
change, security-based swap submission or advance notice is consistent
with the Act. Comments may be submitted by any of the following
methods:

Electronic Comments

     Use the Commission's internet comment form (http://www.sec.gov/rules/sro.shtml) or
     Send an email to<EMAIL_ADDRESS>Please include
File Number SR-ICEEU-2019-019 on the subject line.

Paper Comments

     Send paper comments in triplicate to Secretary, Securities
and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.

All submissions should refer to File Number SR-ICEEU-2019-019. This
file number should be included on the subject line if email is used. To
help the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's internet website (http://www.sec.gov/rules/sro.shtml).
Copies of the submission, all subsequent amendments, all written
statements with respect to the proposed rule change that are filed with
the Commission, and all written communications relating to the proposed
rule change between the Commission and any person, other than those
that may be withheld from the public in accordance with the provisions
of 5 U.S.C. 552, will be available for website viewing and printing in
the Commission's Public Reference Room, 100 F Street NE, Washington, DC
20549, on official business days between the hours of 10:00 a.m. and
3:00 p.m. Copies of such filings will also be available for inspection
and copying at the principal office of ICE Clear Europe and on ICE
Clear Europe's website athttps://www.theice.com/clear-europe/regulation.
    All comments received will be posted without change. Persons
submitting comments are cautioned that we do not redact or edit
personal identifying information from comment submissions. You should
submit only information that you wish to make available publicly. All
submissions should refer to File Number SR-ICEEU-2019-019 and should be
submitted on or before January 13, 2020.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\11\
---------------------------------------------------------------------------

    \11\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2019-27587 Filed 12-20-19; 8:45 am]
 BILLING CODE 8011-01-P


EPA ANTIMICROBIALS DIVISION

 COMPANY NOTICE OF FILING TEMPLATE FOR PESTICIDE PETITIONS PUBLISHED IN
THE FEDERAL REGISTER

(2/27/06)

EPA Antimicrobials Division contact: Velma Noble,<PHONE_NUMBER>

 ADVANCE \d12

Lonza Inc.

[6F7045]

EPA has received a pesticide petition (6F7045) from Lonza Inc., 90
Boroline Road, Annandale, NJ, 07401 proposing, pursuant to section
408(d) of the Federal Food, Drug, and Cosmetic Act (FFDCA), 21 U.S.C.
346a(d), to amend 40 CFR part 180.940(a) by: 1)  increasing the end-use
(use-solution) concentration of the quaternary ammonium compounds,
di-n-alkyl (C8-10) dimethyl ammonium chloride from 150 ppm to 240 ppm
and  2) raising the maximum end-use concentration of all quaternary
ammonium compounds [a combination of di-n-alkyl (C8-10) dimethyl
ammonium chloride and either alkyl (C12-18) dimethyl benzyl ammonium
chloride or n-alkyl (C12-14) dimethyl ethyl benzyl ammonium chloride] in
the sanitizing solution from 200 ppm to 400 ppm.  EPA has determined
that the petition contains data or information regarding the elements
set forth in section 408 (d)(2) of the FFDCA; however, EPA has not fully
evaluated the sufficiency of the submitted data at this time or whether
the data supports granting of the petition.  Additional data may be
needed before EPA rules on the petition.

A. Residue Chemistry

1.  Residue Data.  No residue data is being submitted pursuant to this
petition.  Instead, the petitioner has calculated the potential dietary
exposure due to the increased use-rates for the subject quaternary
ammonium compounds using a model developed by the Food and Drug
Administration (FDA). The FDA model assumes a residual value of 1 mg of
sanitizing solution per cm2 of food-contact surface and that all food
consumed by an individual in a single day contacts 4000 cm2 of
food-contact surfaces.

2.  Analytical method.   An analytical method is not necessary since the
subject quaternary ammonium compounds are exempt from the requirement of
a tolerance.

3.  Magnitude of residues.  Based on the FDA model the petitioner
calculated that the proposed increase in use-rates will result in a
dietary concentration of 32 ppb for di-n-alkyl (C8-10) dimethyl ammonium
chloride and a concentration of 53 ppb for total quaternary ammonium
compounds.

.

B. Toxicological Profile

An extensive and complete toxicology data base has been compiled on
didecyl dimethyl ammonium chloride (DDAC), which is one of the
di-n-alkyl (C8-10) dimethyl ammonium chloride compounds.  The DDAC
safety data base, which includes sub-chronic, chronic, developmental and
reproductive toxicity studies, a mutagenicity battery and
pharmacokinetic studies, meets the Agency’s requirements for food-use
active ingredients.

As per the Agency’s policy regarding the clustering of quaternary
ammonium compounds (refer to PR Notice 88-2), the safety studies
performed with DDAC can also be used for the safety evaluation of the
structurally similar dialkyl dimethyl quats - dioctyl dimethyl ammonium
chloride and octyl decyl dimethyl ammonium chloride - that are also the
subject of this petition.

The petitioner believes that low levels of the di-n-alkyl dimethyl
ammonium chloride compounds in the diet do not implicate any
toxicological endpoints of concern.  The basis for this position is that
all the effects observed in the DDAC safety studies are mediated through
the well-known antimicrobial and/or irritant properties of this
compound, which occur at levels significantly higher than the dietary
exposures that may result from its use on food-contact surfaces.

The DDAC safety studies that are pertinent to a dietary risk assessment
for DDAC and the related dialkyl dimethyl quaternary ammonium compounds
are summarized below.

1.  Sub-chronic.  In the oral sub-chronic study, Sprague-Dawley rats (15
sex/group) were treated with DDAC, by gavage, at dose levels of 0, 100,
300, 600, 1000 and 3000 ppm for either 90 days (males) or 91 days
(females).  The equivalent mg/kg-b.w. doses are: 0, 6.2, 18.5, 36.8,
60.7 and 175.4 (males) and 0, 7.5, 22.3, 75.3, and 225.2 (females).  No
treatment-related effects were observed in any of the test animals at
doses up to 1000 ppm.  At 3000 ppm, high mortality occurred in both
males and females and the surviving animals showed markedly reduced body
weights, decreased serum glucose and protein concentrations, and fluid
or gas filled intestines at necropsy (MRID# 40966302).

2.  Genotoxicity.    DDAC was evaluated in the standard mutagenicity
battery of tests: gene mutation (bacterial and mammalian assays);
chromosomal aberration and unscheduled DNA synthesis.  DDAC was negative
in all of these studies (MDID#’s 40895202; 41252601; 40895201).

3.  Reproductive and developmental toxicity.   A 2-generation
reproduction study with DDAC was conducted with Sprague-Dawley rats.
Test animals were exposed to dosage levels of DDAC in the diet of 0,
300, 750 and 1500 ppm.  Well-defined parental and postnatal toxicity
were observed at the 1500 ppm dose level without any adverse effects on
reproductive performance.  No adverse effects were observed at any of
the other treatment levels (MRID # 41894501).

Developmental toxicity studies were conducted in both the rat and
rabbit.  In the rat study, pregnant Sprague-Dawley rats were exposed to
DDAC on days 6 through 15 of gestation at doses of 0, 1, 10 and 20
mg/kg/day.  Maternal toxicity was noted at 10 and 20 mg/kg by the
characteristic clinical signs of audible respiration and gasping.  In
addition, body weight and food consumption were reduced at the 20 mg/kg
dose.  No treatment related developmental effects were observed at any
dose level.  The actual DDAC concentrations in the dosing solutions were
200, 2000 and 4000 ppm, respectively.  Since all of these concentrations
exceeded the minimum level of DDAC associated with effective
antimicrobial activity, the effects seen in the rat teratology study are
most likely due to the antimicrobial and irritant effects of DDAC (MRID#
41886701).

In the rabbit study, pregnant New Zealand White rabbits were exposed to
DDAC on days 6 through 18 of gestation at doses of 0, 1, 3 and 10
mg/kg/day.  At 10 mg/kg, 4/16 does died prior to day 13 and 1 doe at 10
mg/kg and 2 does at 10 mg/kg delivered early.  The incidence of dead
fetuses was significantly increased at 10 mg/kg and fetal weights per
litter were reduced at 10 mg/kg.  There were no treatment related
increases in the incidence of individual fetal malformations;
malformations by category or of total malformations at any dose level.
The actual DDAC concentrations in the dosing solutions that were
administered were 500, 1500 and 5000 ppm, respectively.  Since all of
these concentrations exceed the minimal level of DDAC associated with
effective antimicrobial activity, the effects seen in the study are most
likely due to the antimicrobial and irritant effects of DDAC (MRID#
41018701).

4.  Chronic toxicity.  Chronic studies with DDAC were conducted in both
the dog and rat.  In the dog study, beagle dogs were treated with DDAC,
by gavage, at doses of 0, 3, 10 and 30 mg/kg/day for one-year.  Dosing
at the 30 mg/kg level was discontinued on day 31 and reinstated on day
36 at 20 mg/kg because of significant body weight and food consumption
depressions.  Treatment related changes in clinical pathology were mild
and limited to the high-dose group.  No treatment related changes were
noted in gross pathology examinations, organ weight data or from
histopathological examination of selected organs and tissues (MRID#
41970401).

In the rat study (combined chronic/oncogenicity study), CD-rats were
administered DDAC in the diet at concentrations of 0, 300, 750 and 1500
ppm for at least 104 weeks.  The doses corresponded to 0, 13, 32 and 64
mg/kg/day for males and 0, 16, 41 and 83 mg/kg day for females.  The
only treatment related effect was a decrease in body weight and food
consumption in both males and females in the high-dose group.  No
treatment related clinical signs of toxicity were noted (MRID#
41965101).

5.  Carcinogenicity studies.   The oncogenic potential of DDAC was
evaluated in both the mouse and rat.  In the mouse study, CD-1 mice were
administered DDAC in the diet at concentrations of 0, 100, 500 and 1000
ppm for at least 78 weeks.  The doses corresponded to mean intake levels
of 0, 15, 76.3 and 155.5 mg/kg/day (males) and 0, 18.6, 93.1 and 193.1
(females).  No treatment related clinical signs of toxicity, increases
in palpable masses, changes in food consumption or differences in
histopathological findings were noted (MRID# 41802301).

In the rat study (combined chronic/oncogenicity study),  CD-rats were
administered DDAC in the diet at concentrations of 0, 300, 750 and 1500
ppm for at least 104 weeks.  The doses corresponded to 0, 12, 32 and 64
mg/kg/day (males) and 0, 16, 41 and 83 mg/kg (females).  The only
treatment related effect was a decrease in body weight and food
consumption in both males and females in the high-dose group.  No
treatment related clinical signs of toxicity were noted (MRID #
41965101).

6.  Animal metabolism.  The adsorption, distribution, metabolism and
excretion of DDAC was evaluated in the rat.  Radiolabeled DDAC was
administered as either a single low-dose, a single high-dose, a repeated
low-dose or a single low intravenous dose.  Almost all the administered
DDAC (89-99%) was excreted in the feces; less than 2.5% was excreted in
the urine.  Tissue residues of DDAC were less than 1% of the
administered dose in all groups (MRID# 41385101).

7.  Endocrine effects.  No special studies investigating the potential
estrogenic or other endocrine effects of DDAC have been conducted.
However, the standard battery of required toxicology studies has been
completed.  These include an evaluation of the potential effects on
reproduction and development, and an evaluation of the pathology of the
endocrine organs following repeated or long-term exposure to doses that
far exceed likely human exposures.  Based on these studies there is no
evidence to suggest that DDAC has an adverse effect on the endocrine
system.

C.  Dietary Exposure

The dietary intake estimates calculated by the petitioner are summarized
in the table below.  The estimates are based on dietary concentrations
of 32 ppb and 53 ppb for di-n-alkyl (C8-10) dimethyl ammonium chloride
and total quaternary ammonium compounds, respectively.  The value used
for the adult body weight is 60 kg and FDA’s value of 3000 grams per
day was used for total daily dietary intake.

      Compounds

         ug/person/day

        ug/kg-b.w./day

Di-n-alkyl (C8-10) dimethyl

ammonium chloride

96

1.6

Total quaternary ammonium compounds

160

2.66

The above dietary intake estimates are limited to adults.  Separate
estimates for dietary exposures to children have not been performed.
The reason for only conducing adult dietary exposures is that the
petitioner believes, as described below, that the adult exposures are
worst-case and are significantly greater than child exposures.

(	The petition is limited to the use of the subject sanitizers in
commercial food-handling establishments, such as restaurants, bars, and
cafeterias.  The dietary estimates assume that a person eats all their
daily meals in such establishments.  It is highly unlikely that children
will receive all their daily meals in these or similar establishments.

(	The food-contact articles that are the major contributors to dietary
exposure are dinner plates and glassware since these articles have the
largest surface area.  The petitioner does not expect that children,
particularly young children, will regularly receive food on dinnerware
or use glassware when eating in public-eating establishments.

D. Cumulative Effects

There is no evidence to indicate or suggest that the subject quaternary
ammonium compounds  have any toxic effects on mammals that would be
cumulative with those of any other chemicals.

E. Safety Determination

There is a reasonable certainty that no harm to the U.S. population will
result from exposure to residues of di-n-alkyl (C8-10) dimethyl ammonium
chloride compounds when these compounds are used as sanitizer
ingredients in antimicrobial formulations applied to food-contact
surfaces in public-eating establishments at an end-use concentration of
240 ppm.  In addition, there is a reasonable certainty that no harm to
the U.S. population will result from exposure to the

combined residues of di-n-alkyl (C8-10) dimethyl ammonium chloride
compounds and either alkyl

(C12-18) dimethyl benzyl ammonium chloride or n-alkyl (C12-14) dimethyl
ethyl benzylammonium chloride when these compounds are used as sanitizer
ingredients in antimicrobial formulations applied to food-contact
surfaces in public-eating establishments at a total end-use
concentration of 400 ppm.

As noted above, low dietary residues of n-alkyl (C8-10) dimethyl
ammonium chloride compounds do not implicate any toxicological endpoints
of concern.  Moreover, there is no available information to suggest that
the quaternary ammonium compounds have any affect on the endocrine
system nor are cumulative effects anticipated from the proposed increase
in end-use concentration.  Finally, oral exposures from the other uses
of the n-alkyl (C8-10) dimethyl ammonium chloride compounds are
anticipated to be minimal.

F. International Tolerances

No incompatibilities with international tolerances are expected.


Allison Wiedeman/DC/USEPA/US

04/03/2007 12:25 PM

	To

<EMAIL_ADDRESS> 	cc

	judy davis/DC/USEPA/US<EMAIL_ADDRESS><EMAIL_ADDRESS>

<EMAIL_ADDRESS><EMAIL_ADDRESS> 	Subject	meeting with NCBA

Linda

On Thursday March 29, I joined Beth Sauerhaft and Sally Shaver in a

meeting with the National Cattleman's Beef Association here at EPA

headquarters.  Judy Davis accompanied me.  I was asked to talk about the

status of the CAFO rule.   I provided information on the proposal, and

confirmed that we were still planning on issuing a final rule in June,

2007.  The major concern submitted by NCBA was the requirement in our

proposed rule that a term of the NPDES permit would include the fields

where manure is being applied.  They content that there is often a need to

buy land quickly under certain circumstances and they can't afford to be

encumbered with a   process to revise their permit before they can make

the purchase.  This email will be part of the public record as a record of

all meetings with stakeholders following a proposed rule, and preceding

the final rule, need to be documented.

Allison Wiedeman

202-564-0901

<EMAIL_ADDRESS> Chief, Rural Branch

Water Permits Division, Office of Wastewater Management

fax:<PHONE_NUMBER>

US. Environmental Protection Agency

Mail Code 4203 M, Room 7146

1200 Pennsylvania Ave., NW

Washington, DC  20460


						6560.50

ENVIRONMENTAL PROTECTION AGENCY

[FRL-8970-1, EPA-HQ-OW-2008-0238]

Modification to 2008 National Pollutant Discharge Elimination System
(NPDES) General Permit for Stormwater Discharges from Construction
Activities

AGENCY: Environmental Protection Agency (EPA).

ACTION: Notice.

SUMMARY: EPA Regions 1, 2, 3, 5, 6, 7, 8, 9, and 10 today are proposing
for public comment a modification to the 2008 National Pollutant
Discharge Elimination System (NPDES) general permits for stormwater
discharges  associated with construction activity in order to extend by
one-year the expiration date of the permit.  Hereinafter, these NPDES
general permits will be referred to as “permit” or “2008
construction general permit” or “2008 CGP.”  The 2008 CGP was
originally issued for a period not to exceed two (2) years.  Today, EPA
proposes to modify the CGP in order to extend the 2 year term of the
2008 CGP by one year so that it expires on June 30, 2011, instead of
June 30, 2010.  If EPA finalizes this action, the 2008 CGP will be in
effect for a period of three (3) years.  By Federal law, no NPDES permit
may be issued for a period that exceeds five (5) years.

DATES:  Comments on EPA’s proposal, including the draft permit, must
be postmarked by [INSERT DATE 30 DAYS AFTER PUBLICATION].  If finalized
as proposed, EPA would be extending the expiration date of the 2008 CGP
until midnight June 30, 2011.

ADDRESSES:  Comments may be submitted electronically, by mail, or
through hand delivery/courier.  To send comments directly to the docket
for this notice, go to the Federal Docket Management System (FDMS) at
http://www. Regulations.gov and enter Docket ID No. EPA-HQ-OW-2008-0238
in the Search Box under “Comment or Submission.”  Comments may be
sent by electronic mail (e-mail) to   HYPERLINK
<EMAIL_ADDRESS><EMAIL_ADDRESS>, Attention Docket ID No.
EPA-HQ-OW-2008-0238.  To send comments by mail in hard copy or via a
Disk or CD/ROM, use the following address: Water Docket, Environmental
Protection Agency, mailcode: 2822T, 1200 Pennsylvania Ave., NW.,
Washington, DC 20460, Attention Docket ID No. EPA-HQ-OW-2008-0238.  To
send comments by hand delivery or courier, deliver your comments to:
Public Reading Room, Room B102, EPA West Building, 1301 Constitution
Avenue, NW, Washington, DC 20004, Attention Docket ID No.
EPA-HQ-OW-2008-0238.  Further instructions for submitting comments are
provided in Section I.C.

FOR FURTHER INFORMATION CONTACT:  Greg Schaner, Water Permits Division,
Office of Wastewater Management (Mail Code:  4203M), Environmental
Protection Agency, 1200 Pennsylvania Avenue, NW, EPA East, Washington,
DC 20460; telephone number:<PHONE_NUMBER>; fax number:<PHONE_NUMBER>;
email address<EMAIL_ADDRESS>

SUPPLEMENTARY INFORMATION:

I.   General Information

A.  Does this Action Apply to Me?

		If a discharger chooses to apply to for coverage under the 2008 CGP,
the permit provides specific requirements for preventing contamination
of stormwater discharges from the following construction activities:

Category	Examples of Affected Entities	North American Industry
Classification System (NAICS) Code

Industry	Construction site operators disturbing 1 or more acres of land,
or less than 1 acre but part of a larger common plan of development or
sale if the larger common plan will ultimately disturb 1 acre or more,
and performing the following activities:

	Building, Developing and General Contracting	233

	Heavy Construction	234

EPA does not intend the preceding table to be exhaustive, but provides
it as a guide for readers regarding entities likely to be regulated by
this action.  This table lists the types of activities that EPA is now
aware of that could potentially be affected by this action.  Other types
of entities not listed in the table could also be affected.  To
determine whether your facility is affected by this action, you should
carefully examine the definition of “construction activity” and
“small construction activity” in existing EPA regulations at 40 CFR
122.26(b)(14)(x) and 122.26(b)(15), respectively.  If you have questions
regarding the applicability of this action to a particular entity,
consult the person listed for technical information in the preceding
“FOR FURTHER INFORMATION CONTACT” section.

	Eligibility for coverage under the 2008 CGP is limited to operators of
“new projects” or “unpermitted ongoing projects.” A “new
project” is one that commences after the effective date of the 2008
CGP.  An “unpermitted ongoing project” is one that commenced prior
to the effective date of the 2008 CGP, yet never received authorization
to discharge under the 2003 CGP or any other NPDES permit covering its
construction-related stormwater discharges.  This permit is effective
only in those areas where EPA is the permitting authority.  A list of
eligible areas is included in Appendix B of the 2008 CGP.

B.  How Can I Get Copies of This Document and Other Related Information?

1. Docket. EPA has established an official public docket for this action
under Docket ID No. EPA-HQ-OW-2008-0238.  The official public docket is
the collection of materials that is available for public viewing at the
Water Docket in the EPA Docket Center, (EPA/DC) EPA West, Room 3334,
1301 Constitution Ave., NW, Washington, DC 20460.  Although all
documents in the docket are listed in an index, some information is not
publicly available, i.e., Confidential Business Information (CBI) or
other information whose disclosure is restricted by statute.  Publicly
available docket materials are available electronically through
HYPERLINK "www.regulations.gov%20"  www.regulations.gov  and in hard
copy at the EPA Docket Center Public Reading Room, open from 8:30 a.m.
to 4:30 p.m., Monday through Friday, excluding legal holidays. The
telephone number for the Public Reading Room is<PHONE_NUMBER> and the
telephone number for the Water Docket is<PHONE_NUMBER>.

2. Electronic Access. You may access this Federal Register document
electronically through the EPA Internet under the “Federal Register”
listings at   HYPERLINK "http://www.epa.gov/fedrgstr/"
http://www.epa.gov/fedrgstr/ .  Electronic versions of the final permit
and fact sheet are available at EPA’s stormwater website
http://www.epa.gov/npdes/stormwater.

An electronic version of the public docket is available through EPA's
electronic public docket and comment system, EPA Dockets. You may use
EPA Dockets at http://www.regulations.gov/fdmspublic/component/main view
public comments, access the index listing of the contents of the
official public docket, and to access those documents in the public
docket that are available electronically. Once in the system, select
”search”, then key in the appropriate docket identification number.

Certain types of information will not be placed in the EPA Dockets.
Information claimed as CBI and other information whose disclosure is
restricted by statute, which is not included in the official public
docket, will not be available for public viewing in EPA's electronic
public docket. EPA policy is that copyrighted material will not be
placed in EPA's electronic public docket but will be available only in
printed, paper form in the official public docket. Although not all
docket materials may be available electronically, you may still access
any of the publicly available docket materials through the docket
facility identified in Section I.B.1.

Submitting CBI.  Do not submit this information to EPA through
regulations.gov or e-mail.  Clearly mark all of the information that you
claim to be CBI.  For CBI information on computer disks mailed to EPA,
mark the surface of the disk as CBI.  Also identify electronically the
specific information contained in the disk or that you claim is CBI.  In
addition to one complete version of the specific information claimed as
CBI, you must submit a copy that does not contain the information
claimed as CBI for inclusion in the public document.  Information so
marked will not be disclosed except in accordance with procedures set
forth in 40 CFR Part 2.

For public commenters, it is important to note that EPA’s policy is
that public comments, whether submitted electronically or in paper, will
be made available for public viewing in EPA’s electronic public docket
as EPA receives them and without change, unless the comment contains
copyrighted material, CBI, or other information whose disclosure is
restricted by statute.  When EPA identifies a comment containing
copyrighted material, EPA will provide a reference to that material in
the version of the comment that is placed in EPA’s electronic public
docket.  The entire printed comment, including the copyrighted material,
will be available in the public docket.

Public comments submitted on computer disks that are mailed or delivered
to the docket will be transferred to EPA’s electronic public docket.
Public comments that are mailed or delivered to the docket will be
scanned and placed in EPA’s electronic public docket.  Where
practical, physical objects will be photographed, and the photograph
will be placed in EPA’s electronic public docket along with a brief
description written by the docket staff.

C.	How and to Whom Do I Submit Comments?

	You may submit comments electronically, by mail, or through hand
delivery/courier.  To ensure proper receipt by EPA, identify the
appropriate docket identification number in the subject line on the
first page of your comment.  To ensure that EPA can read, understand,
and therefore properly respond to comments, the Agency would prefer that
commenters cite, where possible, the paragraph(s) or section in the fact
sheet or permit to which each comment refers.  Please ensure that your
comments are submitted within the specified comment period. Comments
received after the close of the comment period will be marked
“late.”  EPA is not required to consider these late comments.

	1. Electronically.  If you submit an electronic comment as prescribed
below, EPA recommends that you include your name, mailing address, and
an e-mail address or other contact information in the body of your
comment.  Also include this contact information on the outside of any
disk or CD-ROM you submit, and in any cover letter accompanying the disk
or CD-ROM.  This ensures that you can be identified as the submitter of
the comment and allows EPA to contact you in case EPA cannot read your
comment due to technical difficulties or needs further information on
the substance of your comment.  EPA’s policy is that EPA will not edit
your comment, and any identifying or contact information provided in the
body of a comment will be included as part of the comment that is placed
in the official public docket, and made available in EPA’s electronic
public docket.  If EPA cannot read your comment due to technical
difficulties and cannot contact you for clarification, EPA may not be
able to consider your comment.

	i. EPA Dockets. Your use of EPA’s electronic public docket to submit
comments to EPA electronically is EPA’s preferred method for receiving
comments. The system is an “anonymous access” system, which means
EPA will not know your identity, email address, or other contact
information unless you provide it in the body of your comment.

	ii. E-mail.  In contrast to EPA’s electronic public docket, EPA’s
e-mail system is not an “anonymous access” system.  If you send an
e-mail comment directly to the Docket without going through EPA’s
electronic public docket, EPA’s e-mail system automatically captures
your e-mail address.  E-mail addresses that are automatically captured
by EPA’s e-mail system are included as part of the comment that is
placed in the official public docket, and made available in EPA’s
electronic public docket.

	iii. Disk or CD-ROM.  These electronic submissions will be accepted in
Microsoft Word or ASCII file format.  Avoid the use of special
characters and any form of encryption.

	2. By mail.  Send the original and three copies of your comments.

	3. By Hand Delivery or Courier.  Such deliveries are only accepted
during the Docket’s normal hours of operation as identified in Section
I.B.

D. Public Hearings.

EPA has not scheduled any public hearings to receive public comment
concerning the proposed permit. All persons will continue to have the
right to provide written comments during the public comment period.
However, interested persons may request a public hearing pursuant to 40
CFR 124.12 concerning the proposed permit. Requests for a public hearing
must be sent or delivered in writing to the same address as provided
above for public comments prior to the close of the comment period.
Requests for a public hearing must state the nature of the issues
proposed to be raised in the hearing. Pursuant to 40 CFR 124.12, EPA
shall hold a public hearing if it finds, on the basis of requests, a
significant degree of public interest in a public hearing on the
proposed permit. If EPA decides to hold a public hearing, a public
notice of the date, time and place of the hearing will be made at least
30 days prior to the hearing. Any person may provide written or oral
statements and data pertaining to the proposed permit at the public
hearing.

E. Finalizing this Action.

This action will not be finalized until after all significant public
comments have been considered and addressed. EPA’s response to public
comments received will be included in the docket as part of the final
action.  Once the final permit becomes effective, operators of new and
unpermitted ongoing construction projects may seek authorization under
the new 2008 CGP prior to the midnight June 30, 2011 expiration date.

C.  Who Are The EPA Regional Contacts for This Permit?

For EPA Region 1, contact Jessica Hing at tel.:<PHONE_NUMBER> or e-mail
at<EMAIL_ADDRESS>
For EPA Region 2, contact Stephen Venezia at tel.:<PHONE_NUMBER> or
e-mail at<EMAIL_ADDRESS>or for Puerto Rico, contact Sergio
Bosques at tel.:<PHONE_NUMBER> or e-mail at<EMAIL_ADDRESS>
For EPA Region 3, contact Garrison Miller at tel.:<PHONE_NUMBER> or
e-mail at<EMAIL_ADDRESS>
For EPA Region 5, contact Brian Bell at tel.:<PHONE_NUMBER> or e-mail
at<EMAIL_ADDRESS>
For EPA Region 6, contact Brent Larsen at tel.:<PHONE_NUMBER> or e-mail
at<EMAIL_ADDRESS>For EPA Region 7, contact Mark Matthews at
tel.:<PHONE_NUMBER> or e-mail at:    HYPERLINK
<EMAIL_ADDRESS><EMAIL_ADDRESS>.

For EPA Region 8, contact Greg Davis at tel.:<PHONE_NUMBER> or e-mail
at:   HYPERLINK<EMAIL_ADDRESS><EMAIL_ADDRESS>.

For EPA Region 9, contact Eugene Bromley at tel.:<PHONE_NUMBER> or
e-mail at   HYPERLINK<EMAIL_ADDRESS><EMAIL_ADDRESS>.

For EPA Region 10, contact Dick Hetherington at tel.:<PHONE_NUMBER> or
e-mail at<EMAIL_ADDRESS>
II. Background of Permit

A. Statutory and Regulatory History.

The Clean Water Act (“CWA”) establishes a comprehensive program
“to restore and maintain the chemical, physical, and biological
integrity of the Nation’s waters.”  33 U.S.C. § 1251(a).  The CWA
also includes the objective of attaining “water quality which provides
for the protection and propagation of fish, shellfish and wildlife.”
33 U.S.C. § 1251(a)(2)).  To achieve these goals, the CWA requires EPA
to control discharges through the issuance of National Pollutant
Discharge Elimination System (“NPDES”) permits, which may be issued
for fixed terms that may not exceed five (5) years.  33 U.S.C. §
1342(b)(1)(B).

Section 405 of the Water Quality Act of 1987 (WQA) added section 402(p)
of the Clean Water Act (CWA), which directed EPA to develop a phased
approach to regulate stormwater discharges under the NPDES program.  EPA
published a final regulation in the Federal Register on the first phase
of this program on November 16, 1990, establishing permit application
requirements for “storm water discharges associated with industrial
activity.”  See 55 FR 47990.  EPA defined the term “storm water
discharge associated with industrial activity” in a comprehensive
manner to cover a wide variety of facilities. Construction activities,
including activities that are part of a larger common plan of
development or sale, that ultimately disturb at least five acres of land
and have point source discharges to waters of the U.S. were included in
the definition of “industrial activity” pursuant to 40 CFR
122.26(b)(14)(x). Phase II of the stormwater program was published in
the Federal Register on December 8, 1999, and required NPDES permits for
discharges from construction sites disturbing at least one acre, but
less than five acres, including sites that are part of a larger common
plan of development or sale that will ultimately disturb at least one
acre but less than five acres, pursuant to 40 CFR 122.26(b)(15)(i).  See
64 FR 68722.  EPA is proposing to extend the expiration date of the 2008
CGP under the statutory and regulatory authority cited above.

NPDES permits issued for construction stormwater discharges are required
under Section 402(a)(1) of the CWA to include conditions for meeting
technology-based effluent limits established under Section 301 and,
where applicable, Section 306.  Once an effluent limitations guideline
or new source performance standard is promulgated in accordance with
these sections, NPDES permits are required to incorporate limits based
on such limitations and standards.  See 40 CFR 122.44(a)(1).  Prior to
the promulgation of national effluent limitations and standards,
permitting authorities incorporate technology-based effluent limitations
on a best professional judgment basis.  CWA section 402(a)(1)(B); 40 CFR
125.3(a)(2)(ii)(B).

B.  Summary of 2008 CGP.

EPA announced the issuance of the 2008 CGP on July 14, 2008.  See 73 FR
40338.  Construction operators choosing to be covered by the 2008 CGP
must certify in their notice of intent (NOI) that they meet the
requisite eligibility requirements, described in Part 1.3 of the permit.
 If eligible, operators are authorized to discharge under this permit in
accordance with Part 2.  Permittees must install and implement control
measures to meet the effluent limits applicable to all dischargers in
Part 3, and must inspect such stormwater controls and repair or modify
them in accordance with Part 4.  The permit in Part 5 requires all
construction operators to prepare a stormwater pollution prevention plan
(SWPPP) that identifies all sources of pollution, and describes control
measures used to minimize pollutants discharged from the construction
site.  Part 6 details the requirements for terminating coverage under
the permit.

The 2008 CGP permit provides coverage for discharges from construction
sites that occur in areas not covered by an approved State NPDES
program.  EPA Regions 1, 2, 3, 5, 6, 7, 8, 9, and 10 issued the 2008 CGP
to replace the expired 2003 CGP for operators of new and unpermitted
ongoing construction projects.  The geographic coverage and scope of the
2008 CGP is listed in Appendix B of the permit.

C.  What Is EPA’s Rationale for the Modification of the 2008 CGP for a
One-Year Extension of the Expiration Date?

As stated, EPA proposes to modify the 2008 CGP by extending, by one
year, the expiration date of the 2008 CGP.  This proposed action is
necessary due to EPA’s schedule for finalizing effluent limitations
guidelines (ELG) and new source performance standards (NSPS)
(hereinafter, ELG) for the construction and development (C&D) point
source category, and the anticipated timeframes associated with issuing
a new CGP that incorporates the substantive requirements of the C&D ELG.
 The permit modification for the proposed one-year extension of the 2008
CGP is based on actions and initiatives the Agency is undertaking or
planning to undertake and the resulting resource demands they are
placing on EPA’s NPDES stormwater program.  The cumulative impact of
these new initiatives will limit the Agency’s ability to meet a
current seven-month timeframe to incorporate the requirements of the C&D
ELG into a new CGP before midnight June 30, 2010.

EPA is required by court order to publish and promulgate proposed ELGs
and NSPSs for the C&D point source category by December 1, 2008 and
publish and promulgate final ELGs for the C&D point source category by
December 1, 2009.  See NRDC, et al. v. US EPA, No CV- 0408307 (C.D.
Cal.)(Permanent Injunction and Judgment, December 5, 2006).  Any NPDES
permit issued after the effective date of the C&D ELG, whether issued by
EPA or an authorized state, must incorporate the substantive
technology-based requirements of the ELG into the permit.  The
expiration of the 2008 CGP on midnight June 30, 2010, currently gives
EPA approximately seven months to propose and finalize a new CGP, which
incorporates the C&D ELG requirements, before midnight June 30, 2010.
For a number of reasons, EPA needs more time to incorporate the C&D ELG
into a new CGP and to finalize the permit by midnight June 30, 2010.

The current seven-month timeframe to propose and finalize a new permit
is impracticable based on EPA’s past experience in issuing stormwater
general permits, in general, and with the construction general permit
specifically.  In the past, EPA required an estimated eighteen months to
propose and finalize the 2003 CGP, and a similar amount of time for the
previous construction general permits.  While EPA does not believe the
2008 Multi-Sector General Permit (MSGP) for stormwater discharges
associated with industrial activities is typical, that permit required
almost three years to finalize.  Beyond incorporating updated
modifications to the permit based on changes to the technology-based and
water quality-based effluent limitations into the permit, EPA is
required to conduct many additional tasks that are automatically
required of final Federal actions, such as conducting consultations
under the Endangered Species Act and National Historic Properties Act,
obtaining CWA section 401 certifications for the permit from States and
Indian Country lands, providing the public with an opportunity to
comment,, and responding to all comments received during the public
comment period. Separately, these tasks have historically required more
than seven months.  The combined effect of these tasks that are each
necessary to issue a general permit on EPA’s schedule for permit
issuance is to make a seven-month permit issuance timeframe
impracticable.

EPA is undertaking or planning to undertake actions that are putting new
demands on the Agency’s resources in the NPDES stormwater program.
These new required actions and initiatives will compete for the
Agency’s resources needed to issue a new CGP.  The Agency did not
expect these additional required actions or initiatives when the 2008
CGP was issued in July 2008.  For instance, in October 2008, the
National Research Council (NRC) of the National Academy of Sciences
released its report on EPA’s national stormwater program (Urban
Stormwater Management in the United States, October 2008) (available at,
http://  HYPERLINK
"http://www.epa.gov/npdes/pubs/nrc_stormwaterreport.pdf"
www.epa.gov/npdes/pubs/nrc_stormwaterreport.pdf ), which recommended a
number of fundamental changes to the way in which EPA’s stormwater
program under the CWA is effectuated.  The NRC report states that
stormwater discharges from the built environment remains one of the
greatest challenges of modern water pollution control, “as this source
of contamination is a principal contributor to water quality impairment
of waterbodies nationwide.”  The NRC found that the current regulatory
approach by EPA under the CWA is not adequately controlling all sources
of stormwater discharge that are contributing to waterbody impairment.
NRC recommended that EPA address stormwater discharges from impervious
land cover and promote practices that harvest, infiltrate, and
evapotranspirate stormwater to prevent it from being discharged, which
is critical to reducing the volume and pollutant loading to our
Nation’s waters.  Since the release of the NRC report, EPA has devoted
significant resources to the consideration of the report’s
recommendations and to a determination of the best ways to strengthen
controls on stormwater discharges nationwide.  EPA anticipates expending
significant resources in both the short and long term in addressing the
NRC’s recommendations.  The resource demands on the Agency  that are
necessary to respond to the report’s recommendations were not present
when EPA issued the final 2008 CGP, and were not fully factored into the
anticipated timeline for issuing a CGP that incorporates the C&D ELG by
midnight June 30, 2010.

In addition, on May 12, 2009, President Obama signed Executive Order
(E.O.) 13508, Chesapeake Bay Protection and Restoration (available at,
HYPERLINK "http://executiveorder.chesapeakebay.net/default.aspx"
http://executiveorder.chesapeakebay.net/default.aspx ).  The
President’s E.O., under section 202(a), directed EPA to define the
next generation of tools and actions to restore water quality in the
Chesapeake Bay and describe the changes to be made to regulations,
programs, and policies to implement these actions.   EPA issued a draft
202(a) Report on September 9, 2009. EPA will finalize the section 202(a)
Report in November 2009 and issue a final strategy for protecting and
restoring the Chesapeake Bay on May 12, 2010. The completion of these
tasks and any resulting regulatory or programmatic actions that are
necessary to carry out the E.O. are a high priority for the federal
government, and will consume resources that will not be available to
issue a new CGP by midnight June 30, 2010.

For the reasons discussed above, EPA proposes to modify the 2008 CGP in
order to extend the current midnight June 30, 2010 expiration date by
one year to midnight June 30, 2011.  This will give EPA approximately
the same time period, eighteen months, which the Agency required to
issue the 2003 CGP.  EPA requests comments on this proposed modification
of the 2008 CGP to extend the expiration date to midnight June 30, 2011.

EPA believes it is imperative that EPA has sufficient time to
incorporate the C&D ELG into the CGP and issue a new CGP prior to the
existing permit’s expiration date.  If EPA does not issue a new CGP
before expiration of the existing permit, no new construction projects
may be permitted under the CGP, leaving individual NPDES permits as the
only available option for permitting new projects.  The sole reliance on
individual permits will mean that discharge authorizations will be
delayed due to the greater amount of time and Agency resources that are
required for developing and issuing individual permits.  In turn,
construction projects that need to begin construction activity on or
after midnight June 30, 2010 will be delayed for an uncertain amount of
time until EPA can review their individual permit application and issue
the necessary permits.  Rather than risk detrimental delays to new
construction projects, with no clear benefit to our nation’s surface
waters, EPA has decided that it is advisable to instead modify the 2008
CGP to extend the expiration date by 1 year to midnight June 30, 2011.

D. EPA’s Authority to Modify NPDES Permits

EPA regulations establish when the permitting authority may make
modifications to existing NPDES permits.  In relevant part, EPA
regulations state that “[w]hen the Director receives any
information…he or she may determine whether or not one or more of the
causes listed in paragraph (a)…of this section for
modification…exist.  If cause exists, the Director may modify…the
permit accordingly, subject to the limitations of 40 CFR 124.5(c).” 40
CFR 122.62.  For purposes of this Federal Register notice, the relevant
cause for modification is at 40 CFR 122.62(a)(2), which states a permit
may be modified when “[t]he Director has received new information”
and that information was not available at the time of permit
issuance…and would have justified the application of different permit
conditions at the time of issuance.”  Pursuant to EPA regulations,
“[w]hen a permit is modified, only the conditions subject to the
modification are reopened.” 40 CFR 122.62.

In the case of the 2008 CGP, a permit modification is justified based on
the new information EPA has received since issuance of the 2008 CGP in
July 2008, described above in Section II.C, EPA is undertaking or
planning to undertake actions that are putting new demands on the
Agency’s resources in the NPDES stormwater program. The contents and
the resulting resource demands of the NRC Report and the Chesapeake Bay
E.O. were not available at the time of issuance of the 2008 CGP.
Meeting these new demands while implementing new effluent guidelines and
new source performance standards is not practical in a seven-month time
period.   If this information was available at the time of permit
issuance, it would have justified EPA establishing an expiration date
for the 2008 CGP later than midnight June 30, 2010. As a result, cause
exists under EPA regulations to justify modification of the 2008 CGP to
extend the expiration date of the permit from midnight June 30, 2010 to
midnight June 30, 2011.

Authority: Clean Water Act, 33 U.S.C. 1251 et seq.

Dated: October 9, 2009.

		Ira Leighton,

		Acting Regional Administrator, EPA Region 1.

Dated:  October 9, 2009.

Jose C. Font,

Acting Division Director, Caribbean Environmental Protection Division,
EPA Region 2.

Dated: October 8, 2009.

Kevin Bricke,

Acting Division Director, Division of Environmental Planning &
Protection, EPA Region 2.

Dated: October 9, 2009.

Jon M. Capacasa,

Director, Water Protection Division, EPA Region 3.

Dated: October 9, 2009.

Tinka G. Hyde,

Director, Water Division, EPA Region 5.

Dated: October 9, 2009.

Bill Luthans,

Acting Director, Water Quality Protection Division, EPA Region 6.

Dated:  October 8, 2009.

Karen A. Flournoy,

Acting Director, Wetlands and Pesticides Division, EPA Region 7.

Dated: October 8, 2009.

Stephen S. Tuber,

Assistant Regional Administrator,

Office of Partnerships & Regulatory Assistance,

EPA Region 8.

Dated: October 9, 2009.

Alexis Strauss,

Director, Water Division, EPA Region 9.

Dated: October 9, 2009.

Christine Psyk,

Acting Director, Office of Water and Watersheds, EPA Region 10.

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