[Federal Register Volume 79, Number 225 (Friday, November 21, 2014)]
[Notices]
[Pages 69540-69545]
[FR Doc No: 2014-27570]

-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-73613; File No. SR-NYSEArca-2014-127]

Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing
and Immediate Effectiveness of Proposed Rule Change Relating to Use of
Derivative Instruments by the First Trust Preferred Securities and
Income ETF

November 17, 2014.
    Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of
1934 (the ``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby
given that, on November 5, 2014, NYSE Arca, Inc. (the ``Exchange'' or
``NYSE Arca'') 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 Commission
is publishing this notice to solicit comments on the proposed rule
change from interested persons.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 15 U.S.C. 78a.
    \3\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------

I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

    The Exchange proposes to reflect a change to the means of achieving
the investment objective applicable to the First Trust Preferred
Securities and Income ETF (the ``Fund'') relating to its use of
derivative instruments. The Fund is currently listed and traded on the
Exchange under NYSE Arca Equities Rule 8.600 (``Managed Fund Shares'').
The text of the proposed rule change is available on the Exchange's Web
site at www.nyse.com, at the principal office of the Exchange, 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 the
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The Commission has approved listing and trading on the Exchange of
shares (``Shares'') of the Fund under NYSE Arca Equities Rule 8.600,
which governs the listing and trading of Managed Fund Shares on the
Exchange.\4\ The Shares are offered by the First Trust Exchange-Traded
Fund III (the ``Trust''), which was organized as a Massachusetts
business trust and is registered with the Commission as an open-end
management investment company.\5\
---------------------------------------------------------------------------

    \4\ The Commission originally approved the listing and trading
of the Shares on the Exchange on February 8, 2013. See Securities
Exchange Act Release No. 68870 (February 8, 2013), 78 FR 11245
(February 15, 2013) (SR-NYSEArca-2012-139) (``Prior Order''). See
also Securities Exchange Act Release No. 68458 (December 18, 2012),
77 FR 76148 (December 26, 2012) (SR-NYSEArca-2012-139) (``Prior
Notice,'' and together with the Prior Order, the ``Prior Release'').
    \5\ The Trust is registered under the Investment Company Act of
1940 (``1940 Act''). On February 28, 2014, the Trust filed with the
Commission an amendment to its registration statement on Form N-1A
(File Nos. 333-176976 and 811-22245) under the Securities Act of
1933 (``Securities Act'') and under the 1940 Act relating to the
Fund (``Registration Statement''). The descriptions of the Shares
and the Fund contained herein are based, in part, on information in
the Registration Statement. In addition, the Commission has issued
an order granting certain exemptive relief to the Trust under the
1940 Act. See Investment Company Act Release No. 30029 (April 10,
2012) (File No. 812-13795) (the ``Exemptive Order'').
---------------------------------------------------------------------------

    First Trust Advisors L.P. (``First Trust Advisors'') is the
investment adviser

(``Adviser'') to the Fund. Stonebridge Advisors LLC serves as sub-
adviser (``Sub-Adviser'') to the Fund.
    In this proposed rule change, the Exchange proposes to change the
description of the Fund's use of derivative instruments, as described
below.\6\
---------------------------------------------------------------------------

    \6\ The Adviser represents that the Adviser and the Sub-Adviser
have managed and will continue to manage the Fund in the manner
described in the Prior Release and the Rule 144A Representation (as
defined below), and will not implement the changes described herein
until the instant proposed rule change is operative.
---------------------------------------------------------------------------

    On December 6, 2012, the staff of the Commission's Division of
Investment Management (``Division'') issued a no-action letter (``No-
Action Letter'') relating to the use of derivatives by actively-managed
exchange-traded funds (``ETFs'').\7\ The No-Action Letter noted that,
in March of 2010, the Commission announced in a press release that the
staff was conducting a review to evaluate the use of derivatives by
mutual funds, ETFs, and other investment companies and that, pending
completion of this review, the staff would defer consideration of
exemptive requests under the 1940 Act relating to, among others,
actively-managed ETFs that would make significant investments in
derivatives.
---------------------------------------------------------------------------

    \7\ See No-Action Letter dated December 6, 2012 from Elizabeth
G. Osterman, Associate Director, Office of Exemptive Applications,
Division of Investment Management.
---------------------------------------------------------------------------

    The No-Action Letter stated that the Division staff will no longer
defer consideration of exemptive requests under the 1940 Act relating
to actively-managed ETFs that make use of derivatives provided that
they include representations to address some of the concerns expressed
in the Commission's March 2010 press release. These representations
are: (i) That the ETF's board periodically will review and approve the
ETF's use of derivatives and how the ETF's investment adviser assesses
and manages risk with respect to the ETF's use of derivatives; and (ii)
that the ETF's disclosure of its use of derivatives in its offering
documents and periodic reports is consistent with relevant Commission
and staff guidance (together, the ``No-Action Letter
Representations''). The No-Action Letter stated that the Division would
not recommend enforcement action to the Commission under sections
2(a)(32), 5(a)(1), 17(a), 22(d), and 22(e) of the 1940 Act, or rule
22c-1 under the 1940 Act if actively-managed ETFs operating in reliance
on specified orders (which include the Trust's Exemptive Order \8\)
invest in options contracts, futures contracts or swap agreements
provided that they comply with the No-Action Letter Representations.\9\
---------------------------------------------------------------------------

    \8\ See note 5, supra.
    \9\ The Adviser acknowledges that, for the Fund to rely on the
No-Action Letter, the Fund must comply with the No-Action Letter
Representations, which include the following: (i) The Board of
Trustees of the Trust (the ``Trust Board'') will periodically review
and approve the Fund's use of derivatives and how the Adviser
assesses and manages risk with respect to the Fund's use of
derivatives and (ii) the Fund's disclosure of its use of derivatives
in its offering documents and periodic reports will be consistent
with relevant Commission and staff guidance.
---------------------------------------------------------------------------

    The Prior Release included the following representation:
``Consistent with the Exemptive Order, the Fund will not invest in
options contracts, futures contracts, or swap agreements'' (the
``Derivatives Representation''). In view of the No-Action Letter, the
Exchange is proposing to delete the Derivatives Representation.
    The Exchange now proposes that, to pursue its investment objective,
the Fund be permitted to invest in exchange-traded and over-the-counter
(``OTC'') interest rate swaps, exchange-listed options on U.S. Treasury
futures contracts, exchange-listed U.S. Treasury futures contracts,
exchange-listed options on Eurodollar futures contracts, exchange-
listed Eurodollar futures contracts, exchange-traded and OTC non-U.S.
currency swaps, exchange-listed currency options, forward currency
contracts and non-deliverable forward currency contracts (collectively,
``Derivative Instruments'').\10\ The use of Derivative Instruments may
allow the Fund to seek to enhance return, to hedge some of the risks of
its investments in securities, to substitute a position in an
underlying asset, to reduce transaction costs, to maintain full market
exposure (which means to adjust the characteristics of its investments
to more closely approximate those of the markets in which it invests),
to manage cash flows, to preserve capital or to manage its foreign
currency exposures.\11\
---------------------------------------------------------------------------

    \10\ Non-deliverable forward currency contracts do not involve
physical exchange of the two currencies of the subject contract, but
instead a net cash settlement of the two currencies is made by one
party to the other and is based upon the movement of the two
currencies relative to each other. The net cash settlement occurs in
a predetermined convertible currency. Non-deliverable forward
currency contracts differ from conventional forward currency
contracts in that there is not a physical exchange of the subject
currencies at settlement, and non-deliverable forward currency
contracts can be used on currencies that may be less liquid and/or
have a smaller market of trade.
    \11\ In particular, the Sub-Adviser contemplates that the Fund
will utilize Derivative Instruments for hedging purposes. For
example, the Sub-Adviser may seek to use futures contracts or swap
agreements to hedge the Fund's assets against higher rates by
reducing its [sic] overall duration.
---------------------------------------------------------------------------

    Under normal market conditions, no more than 20% of the value of
the Fund's net assets will be invested in Derivative Instruments.\12\
In addition, at least 90% of the Fund's net assets that are invested in
exchange-listed options on U.S. Treasury futures contracts, exchange-
listed U.S. Treasury futures contracts, exchange-listed options on
Eurodollar futures contracts, exchange-listed Eurodollar futures
contracts, and exchange-listed currency options will be invested in
such instruments whose principal market is a member of the Intermarket
Surveillance Group (``ISG''), which includes all U.S. national
securities exchanges, certain U.S. futures exchanges and certain
foreign exchanges, or are parties to a comprehensive surveillance
sharing agreement with the Exchange.\13\
---------------------------------------------------------------------------

    \12\ The Fund will limit its direct investments in futures,
options on futures and swaps to the extent necessary for the Adviser
to claim the exclusion from regulation as a ``commodity pool
operator'' with respect to the Fund under Rule 4.5 promulgated by
the Commodity Futures Trading Commission (``CFTC''), as such rule
may be amended from time to time. Under Rule 4.5 as currently in
effect, the Fund will limit its trading activity in futures, options
on futures and swaps (excluding activity for ``bona fide hedging
purposes,'' as defined by the CFTC) such that it will meet one of
the following tests: (i) Aggregate initial margin and premiums
required to establish its futures, options on futures and swap
positions will not exceed 5% of the liquidation value of the Fund's
portfolio, after taking into account unrealized profits and losses
on such positions; or (ii) aggregate net notional value of its
futures, options on futures and swap positions will not exceed 100%
of the liquidation value of the Fund's portfolio, after taking into
account unrealized profits and losses on such positions.
    \13\ For a list of the current members of ISG, see
www.isgportal.org. As stated in the Prior Release, the Exchange
notes that not all components of the Disclosed Portfolio for the
Fund may trade on markets that are members of ISG or with which the
Exchange has in place a comprehensive surveillance sharing
agreement.
---------------------------------------------------------------------------

    The Prior Release stated that the Fund's investments would be
consistent with the Fund's investment objective and would not be used
to enhance leverage. In view of the Exchange's proposal to permit the
Fund to use Derivative Instruments, the Fund's investments in
Derivative Instruments could potentially be used to enhance leverage.
However, the Fund's investments in Derivative Instruments will be
consistent with the Fund's investment objective and will not be used to
seek to achieve a multiple or inverse multiple of an index.
    Investments in Derivative Instruments will be made in accordance
with the 1940 Act and consistent with the Fund's investment objective
and policies. The Fund will comply with the regulatory requirements of
the Commission to maintain assets as ``cover,'' maintain segregated
accounts, and/or make margin payments when it takes

positions in Derivative Instruments involving obligations to third
parties (i.e., instruments other than purchase options). If the
applicable guidelines prescribed under the 1940 Act so require, the
Fund will earmark or set aside cash, U.S. government securities, high
grade liquid debt securities and/or other liquid assets permitted by
the Commission in a segregated custodial account in the amount
prescribed.\14\
---------------------------------------------------------------------------

    \14\ With respect to guidance under the 1940 Act, see 15 U.S.C.
80a-18; Investment Company Act Release No. 10666 (April 18, 1979),
44 FR 25128 (April 27, 1979); Dreyfus Strategic Investing,
Commission No-Action Letter (June 22, 1987); Merrill Lynch Asset
Management, L.P., Commission No-Action Letter (July 2, 1996).
---------------------------------------------------------------------------

    The Fund will include appropriate risk disclosure in its offering
documents, including leveraging risk. Leveraging risk is the risk that
certain transactions of the Fund, including the Fund's use of
Derivative Instruments, may give rise to leverage, causing the Fund to
be more volatile than if it had not been leveraged.\15\
---------------------------------------------------------------------------

    \15\ To mitigate leveraging risk, the Fund will segregate or
``earmark'' liquid assets or otherwise cover the transactions that
may give rise to such risk.
---------------------------------------------------------------------------

    Based on the above, the Exchange seeks this modification regarding
the Fund's use of Derivative Instruments. The Adviser represents that
there is no change to the Fund's investment objective. The Adviser and
the Sub-Adviser believe that the ability to invest in Derivative
Instruments will provide the Sub-Adviser with additional flexibility to
meet the Fund's investment objective.
    The Exchange further notes that the Prior Release stated that the
Fund may hold up to an aggregate amount of 15% of its net assets in
illiquid securities (calculated at the time of investment), including,
among other enumerated assets, Rule 144A securities. To clarify this
statement given that Rule 144A securities are not necessarily
``illiquid,'' the Adviser now represents that the Fund's limitation on
holding up to an aggregate amount of 15% of its net assets in illiquid
assets (calculated at the time of investment) would include Rule 144A
securities deemed illiquid by the Adviser or Sub-Adviser, in accordance
with Commission guidance (the ``Rule 144A Representation'').\16\
---------------------------------------------------------------------------

    \16\ A change regarding the restriction on the Fund's
investments in Rule 144A securities was reflected in a supplement to
the Registration Statement, dated March 31, 2014. The Commission has
stated that long-standing Commission guidelines have required open-
end funds to hold no more than 15% of their net assets in illiquid
securities and other illiquid assets. See Investment Company Act
Release No. 28193 (March 11, 2008), 73 FR 14618 (March 18, 2008),
footnote 34. See also, Investment Company Act Release No. 5847
(October 21, 1969), 35 FR 19989 (December 31, 1970) (Statement
Regarding ``Restricted Securities''); Investment Company Act Release
No. 18612 (March 12, 1992), 57 FR 9828 (March 20, 1992) (Revisions
of Guidelines to Form N-1A). A fund's portfolio security is illiquid
if it cannot be disposed of in the ordinary course of business
within seven days at approximately the value ascribed to it by the
fund. See Investment Company Act Release No. 14983 (March 12, 1986),
51 FR 9773 (March 21, 1986) (adopting amendments to Rule 2a-7 under
the 1940 Act); Investment Company Act Release No. 17452 (April 23,
1990), 55 FR 17933 (April 30, 1990) (adopting Rule 144A under the
Securities Act).
    The Commission previously has approved listing and trading on
the Exchange of issues of Managed Fund Shares that may invest up to
an aggregate amount of 15% of a fund's net assets in Rule 144A
securities deemed illiquid by a fund's adviser, in accordance with
Commission guidance. See, e.g., Securities Exchange Act Release No.
71067 (December 12, 2013), 78 FR 76669 (December 18, 2013) (order
approving listing and trading of shares of the SPDR MFS Systematic
Core Equity ETF, SPDR MFS Systematic Growth Equity ETF, and SPDR MFS
Systematic Value Equity ETF under NYSE Arca Equities Rule 8.600).
---------------------------------------------------------------------------

    The Fund will continue to comply with all initial and continued
listing requirements under NYSE Arca Equities Rule 8.600.
    Except for the changes noted herein, all other facts presented and
representations made in the Rule 19b-4 filing underlying the Prior
Release remain unchanged.
    The changes described herein will be effective upon (i) the
effectiveness of an amendment to the Trust's Registration Statement
disclosing the Fund's intended use of Derivative Instruments and (ii)
when this proposed rule change has become operative. The Adviser
represents that the Adviser, has managed and will continue to manage
the Fund in the manner described in the Prior Release and the Rule 144A
Representation, and will not implement the changes described herein
until this proposed rule change is operative.
Impact on Arbitrage Mechanism
    The Adviser believes there will be minimal, if any, impact to the
arbitrage mechanism as a result of the use of derivatives. Market
makers and participants should be able to value derivatives as long as
the positions are disclosed with relevant information. The Adviser
believes that the price at which Shares trade will continue to be
disciplined by arbitrage opportunities created by the ability to
purchase or redeem Creation Units (as defined below) at their net asset
value (``NAV''), which should ensure that Shares will not trade at a
material discount or premium in relation to their NAV.
    The Adviser does not believe there will be any significant impacts
to the settlement or operational aspects of the Fund's arbitrage
mechanism due to the use of derivatives. Certain derivatives may not be
eligible for in-kind transfer, and such derivatives will be substituted
with a ``cash in lieu'' amount (as described below) when the Fund
processes purchases or redemptions of Creation Units (as defined below)
in-kind.
Creation and Redemption of Shares
    The Fund will issue and redeem Shares on a continuous basis, at
NAV, only in large specified blocks each consisting of 50,000 Shares
(each such block of Shares, a ``Creation Unit''). The Fund will issue
and redeem Creation Units in exchange for an in-kind portfolio of
instruments and/or cash in lieu of such instruments (the ``Creation
Basket''). In addition, if there is a difference between the NAV
attributable to a Creation Unit and the market value of the Creation
Basket exchanged for the Creation Unit, the party conveying instruments
with the lower value will pay to the other an amount in cash equal to
the difference (referred to as the ``Cash Component''). Cash will be
conveyed in lieu of any Derivative Instruments that cannot be
transferred in-kind.
    The Fund's custodian, through the National Securities Clearing
Corporation, will make available on each business day, prior to the
opening of business of the New York Stock Exchange, the list of the
names and quantities of the instruments comprising the Creation Basket,
as well as the estimated Cash Component (if any), for that day. The
published Creation Basket will apply until a new Creation Basket is
announced on the following business day.
Valuation for Purposes of Calculating Net Asset Value
    As indicated in the Prior Release, the Fund's NAV is determined as
of the close of trading (normally 4:00 p.m., Eastern Time) on each day
the New York Stock Exchange is open for business and is calculated by
taking the market value of the Fund's total assets, including interest
or dividends accrued but not yet collected, less all liabilities, and
dividing such amount by the total amount of Shares outstanding.
    For purposes of calculating NAV, the Fund's investments are valued
daily at market value or, in the absence of market value with respect
to any such investment, at fair value, in each case in accordance with
valuation procedures (which may be revised from time to time) adopted
by the Trust Board (the ``Valuation Procedures'') and in accordance
with the 1940 Act. All valuations are subject to review by the Trust
Board or its delegate. A market

valuation generally means a valuation (i) obtained from an exchange, an
independent pricing service (``Pricing Service''), or a major market
maker (or dealer) or (ii) based on a price quotation or other
equivalent indication of value supplied by an exchange, a Pricing
Service, or a major market maker (or dealer). The information
summarized below is based on the Valuation Procedures as currently in
effect; however, as noted above, the Valuation Procedures are amended
from time to time and, therefore, such information is subject to
change.
    Exchange-listed options on U.S. Treasury futures contracts,
exchange-listed U.S. Treasury futures contracts, exchange-listed
options on Eurodollar futures contracts, exchange-listed Eurodollar
futures contracts, and exchange-listed currency options will typically
be valued at the closing price in the market where such instruments are
principally traded. OTC and exchange-traded swaps will typically be
valued using a Pricing Service. Forward currency contracts and non-
deliverable forward currency contracts will typically be valued at the
current day's interpolated foreign exchange rate, as calculated using
the current day's spot rate, and the thirty, sixty, ninety, and one-
hundred-eighty day forward rates provided by a Pricing Service or by
certain independent dealers in such contracts.
    Certain Derivative Instruments may not be able to be priced by pre-
established pricing methods. Such Derivative Instruments may be valued
by the Trust Board or its delegate at fair value. The use of fair value
pricing by the Fund is governed by the Valuation Procedures and
conducted in accordance with the provisions of the 1940 Act. As a
general principle, the current ``fair value'' of an asset would appear
to be the amount which the owner might reasonably expect to receive for
the asset upon its current sale. The use of fair value prices by the
Fund generally results in prices used by the Fund that may differ from
current market valuations or official closing prices on the applicable
exchange. A variety of factors may be considered in determining the
fair value of Derivative Instruments.
    Because foreign exchanges may be open on different days than the
days during which an investor may purchase or sell Shares, the value of
the Fund's Derivative Instruments that are traded on foreign exchanges
may change on days when investors are not able to purchase or sell
Shares. Derivative Instruments that are denominated in foreign
currencies will be translated into U.S. dollars at the exchange rate of
such currencies against the U.S. dollar as provided by a Pricing
Service. All Derivative Instruments that are denominated in foreign
currencies will be converted into U.S. dollars at the exchange rates in
effect at the time of valuation.
Availability of Information
    As described in the Prior Release, on each business day, before
commencement of trading in Shares in the Core Trading Session on the
Exchange, the Fund discloses on its Web site the Disclosed Portfolio as
defined in NYSE Arca Equities Rule 8.600(c)(2) that will form the basis
for the Fund's calculation of NAV at the end of the business day. See
``Disclosed Portfolio'' below.
    Pricing information for Derivative Instruments will be available
from major broker-dealer firms, subscription services, and/or Pricing
Services and, in addition, for exchange-traded Derivative Instruments,
from the exchanges on which they are traded.
Disclosed Portfolio
    The Fund's disclosure of derivative positions in the Disclosed
Portfolio will include information that market participants can use to
value these positions intraday. On a daily basis, the Fund will
disclose on the Fund's Web site the following information regarding
each portfolio holding, as applicable to the type of holding: Ticker
symbol, CUSIP number or other identifier, if any; a description of the
holding (including the type of holding, such as the type of swap); the
identity of the security or other asset or instrument underlying the
holding, if any; for options, the option strike price; quantity held
(as measured by, for example, par value, notional value or number of
shares, contracts or units); maturity date, if any; coupon rate, if
any; effective date, if any; market value of the holding; and the
percentage weighting of the holding in the Fund's portfolio.
Surveillance
    The Exchange represents that trading in the Shares will be subject
to the existing trading surveillances, administered by the Financial
Industry Regulatory Authority (``FINRA'') on behalf of the Exchange,
which are designed to detect violations of Exchange rules and
applicable federal securities laws.\17\ The Exchange represents that
these procedures are adequate to properly monitor Exchange trading of
the Shares in all trading sessions and to deter and detect violations
of Exchange rules and federal securities laws applicable to trading on
the Exchange.
---------------------------------------------------------------------------

    \17\ FINRA surveils trading on the Exchange pursuant to a
regulatory services agreement. The Exchange is responsible for
FINRA's performance under this regulatory services agreement.
---------------------------------------------------------------------------

    The surveillances referred to above generally focus on detecting
securities trading outside their normal patterns, which could be
indicative of manipulative or other violative activity. When such
situations are detected, surveillance analysis follows and
investigations are opened, where appropriate, to review the behavior of
all relevant parties for all relevant trading violations.
    FINRA, on behalf of the Exchange, will communicate as needed
regarding trading in the Shares, exchange-listed options on U.S.
Treasury futures contracts, exchange-listed U.S. Treasury futures
contracts, exchange-listed options on Eurodollar futures contracts,
exchange-listed Eurodollar futures contracts, and exchange-listed
currency options with other markets and other entities that are members
of the ISG, and FINRA, on behalf of the Exchange, may obtain trading
information regarding trading in the Shares, exchange-listed options on
U.S. Treasury futures contracts, exchange-listed U.S. Treasury futures
contracts, exchange-listed options on Eurodollar futures contracts,
exchange-listed Eurodollar futures contracts, and exchange-listed
currency options from such markets and other entities. In addition, the
Exchange may obtain information regarding trading in the Shares,
exchange-listed options on U.S. Treasury futures contracts, exchange-
listed U.S. Treasury futures contracts, exchange-listed options on
Eurodollar futures contracts, exchange-listed Eurodollar futures
contracts, and exchange-listed currency options from markets and other
entities that are members of ISG or with which the Exchange has in
place a comprehensive surveillance sharing agreement.\18\
---------------------------------------------------------------------------

    \18\ For a list of the current members of ISG, see
www.isgportal.org. The Exchange notes that not all components of the
Disclosed Portfolio for the Fund may trade on markets that are
members of ISG or with which the Exchange has in place a
comprehensive surveillance sharing agreement.
---------------------------------------------------------------------------

    At least 90% of the Fund's net assets that are invested in
exchange-listed options on U.S. Treasury futures contracts, exchange-
listed U.S. Treasury futures contracts, exchange-listed options on
Eurodollar futures contracts, exchange-listed Eurodollar futures
contracts, and exchange-listed currency options will be invested in
such instruments whose principal market is a member of the ISG.

    In addition, the Exchange also has a general policy prohibiting the
distribution of material, non-public information by its employees.
2. Statutory Basis
    The basis under the Act for this proposed rule change is the
requirement under Section 6(b)(5) \19\ that an exchange have rules that
are designed to prevent fraudulent and manipulative acts and practices,
to promote just and equitable principles of trade, to remove
impediments to, and perfect the mechanism of a free and open market
and, in general, to protect investors and the public interest.
---------------------------------------------------------------------------

    \19\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

    The Exchange believes that the proposed rule change is designed to
prevent fraudulent and manipulative acts and practices in that the
Shares will continue to be listed and traded on the Exchange pursuant
to the initial and continued listing criteria in NYSE Arca Equities
Rule 8.600. The Fund will continue to comply with all initial and
continued listing requirements under NYSE Arca Equities Rule 8.600.
    Under the proposed rule change, the Fund seeks to invest in
Derivative Instruments, consistent with the No-Action Letter. Under
normal market conditions, no more than 20% of the value of the Fund's
net assets will be invested in Derivative Instruments. The Fund's
investments in Derivative Instruments will be consistent with the
Fund's investment objective and will not be used to seek to achieve a
multiple or inverse multiple of an index. Investments in Derivative
Instruments will be made in accordance with the 1940 Act and consistent
with the Fund's investment objective and policies. The Fund will comply
with the regulatory requirements of the Commission to maintain assets
as ``cover,'' maintain segregated accounts, and/or make margin payments
when it takes positions in Derivative Instruments involving obligations
to third parties (i.e., instruments other than purchase options). If
the applicable guidelines prescribed under the 1940 Act so require, the
Fund will earmark or set aside cash, U.S. government securities, high
grade liquid debt securities and/or other liquid assets permitted by
the Commission in a segregated custodial account in the amount
prescribed. Moreover, the Fund will include appropriate risk disclosure
in its offering documents, including leveraging risk.
    The proposed rule change is designed to promote just and equitable
principles of trade and to protect investors and the public interest in
that the Adviser represents that there is no change to the Fund's
investment objective. With respect to the proposal to permit the Fund
to invest in Derivative Instruments, the Adviser represents that use of
Derivative Instruments may allow the Fund to seek to enhance return, to
hedge some of the risks of its investments in securities, to substitute
a position in an underlying asset, to reduce transaction costs, to
maintain full market exposure, to manage cash flows, to preserve
capital or to manage its foreign currency exposures. In addition, such
proposed change will provide the Sub-Adviser with additional
flexibility in meeting the Fund's investment objective. The Adviser has
represented that it believes there will be minimal, if any, impact to
the arbitrage mechanism as a result of the use of derivatives. In
addition, the Commission has previously approved the use of derivatives
similar to those proposed herein by issues of Managed Fund Shares
traded on the Exchange.\20\ Consistent with the Prior Release, NAV will
continue to be calculated daily and the NAV and Disclosed Portfolio (as
defined in NYSE Arca Equities Rule 8.600(c)(2)) will be made available
to all market participants at the same time.
---------------------------------------------------------------------------

    \20\ See, e.g., Securities Exchange Act Release Nos. 73081
(September 11, 2014), 79 FR 55859 (September 17, 2014) (SR-NYSEArca-
2014-20) (order approving listing and trading on the Exchange of
shares of the Reality Shares DIVS ETF under NYSE Arca Equities Rule
8.600); 72882 (August 20, 2014), 79 FR 50964 (August 26, 2014) (SR-
NYSEArca-2014-58) (order approving listing and trading on the
Exchange of shares of the PIMCO Short-Term Exchange-Traded Fund and
the PIMCO Municipal Bond Exchange-Traded Fund under NYSE Arca
Equities Rule 8.600).
---------------------------------------------------------------------------

    With respect to the proposal that at least 90% of the Fund's net
assets that are invested in exchange-listed options on U.S. Treasury
futures contracts, exchange-listed U.S. Treasury futures contracts,
exchange-listed options on Eurodollar futures contracts, exchange-
listed Eurodollar futures contracts, and exchange-listed currency
options will be invested in such instruments whose principal market is
a member of the ISG, the Exchange notes that the Commission has
previously approved such limitations for other funds listed on the
Exchange under NYSE Arca Equities Rule 8.600.\21\ In addition, such a
representation assures that most applicable exchange-traded assets of
the Fund will be assets whose principal market is an ISG member or a
market with which the Exchange has a comprehensive surveillance sharing
agreement.
---------------------------------------------------------------------------

    \21\ See, e.g., Securities Exchange Act Release Nos. 7882
(August 20, 2014) (SR-NYSEArca-2014-58) (order approving listing and
trading on the Exchange of shares of the PIMCO Short-Term Exchange-
Traded Fund and the PIMCO Municipal Bond Exchange-Traded Fund under
NYSE Arca Equities Rule 8.600); 72641 (July 18, 2014), 79 FR 43108
(July 24, 2014) (SR-NYSEArca-2014-64) (order approving listing and
trading on the Exchange of the ARK Innovation ETF, ARK Genomic
Revolution ETF, ARK Industrial Innovation ETF, and ARK Web x.0 ETF
under NYSE Arca Equities Rule 8.600).
---------------------------------------------------------------------------

    With respect to the Adviser now representing that the Fund's
limitation on holding up to an aggregate amount of 15% of its net
assets in illiquid assets (calculated at the time of investment) would
include Rule 144A securities deemed illiquid by the Adviser or Sub-
Adviser, in accordance with Commission guidance, the Exchange notes
that the Commission previously has approved listing and trading on the
Exchange of issues of Managed Fund Shares that may invest up to an
aggregate amount of 15% of a fund's net assets in Rule 144A securities
deemed illiquid by the Adviser or Sub-Adviser, in accordance with
Commission guidance.\22\
---------------------------------------------------------------------------

    \22\ See note 16, supra.
---------------------------------------------------------------------------

    In accordance with the Prior Release, the Fund will monitor its
portfolio liquidity on an ongoing basis to determine whether, in light
of current circumstances, an adequate level of liquidity is being
maintained, and will consider taking appropriate steps in order to
maintain adequate liquidity if, through a change in values, net assets,
or other circumstances, more than 15% of the Fund's net assets are held
in illiquid assets.
    The proposed rule change is designed to perfect the mechanism of a
free and open market and, in general, to protect investors and the
public interest in that it will facilitate the listing and trading of
an actively-managed exchange-traded product that will enhance
competition among market participants, to the benefit of investors and
the marketplace. As noted, the additional flexibility to be afforded to
the Sub-Adviser by permitting the Fund to invest in Derivative
Instruments under the proposed rule change is intended to enhance the
Sub-Adviser's ability to meet the Fund's investment objective. FINRA,
on behalf of the Exchange, will communicate as needed regarding trading
in the Shares, exchange-listed options on U.S. Treasury futures
contracts, exchange-listed U.S. Treasury futures contracts, exchange-
listed options on Eurodollar futures contracts, exchange-listed
Eurodollar futures contracts, and exchange-listed currency options with
other markets and other entities that are members of the ISG, and
FINRA, on behalf of the Exchange, may

obtain trading information regarding trading in the Shares, exchange-
listed options on U.S. Treasury futures contracts, exchange-listed U.S.
Treasury futures contracts, exchange-listed options on Eurodollar
futures contracts, exchange-listed Eurodollar futures contracts, and
exchange-listed currency options from such markets and other entities.
In addition, the Exchange may obtain information regarding trading in
the Shares, exchange-listed options on U.S. Treasury futures contracts,
exchange-listed U.S. Treasury futures contracts, exchange-listed
options on Eurodollar futures contracts, exchange-listed Eurodollar
futures contracts, and exchange-listed currency options from markets
and other entities that are members of ISG or with which the Exchange
has in place a comprehensive surveillance sharing agreement. At least
90% of the Fund's net assets that are invested in exchange-listed
options on U.S. Treasury futures contracts, exchange-listed U.S.
Treasury futures contracts, exchange-listed options on Eurodollar
futures contracts, exchange-listed Eurodollar futures contracts, and
exchange-listed currency options will be invested in such instruments
whose principal market is a member of the ISG. In addition, as
indicated in the Prior Release, investors will have ready access to
information regarding the Fund's holdings, the PIV (as defined in the
Prior Release), the Disclosed Portfolio (as defined in the Prior
Release and as further described herein), and quotation and last sale
information for the Shares.

B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange 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. The Exchange believes the
proposed rule change will permit the Sub-Adviser additional flexibility
in achieving the Fund's investment objective, thereby offering
investors additional investment options.

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 foregoing 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 for 30 days from the date on which it was filed, or
such shorter time as the Commission may designate, if consistent with
the protection of investors and the public interest, the proposed rule
change has become effective pursuant to Section 19(b)(3)(A) of the Act
\23\ and Rule 19b-4(f)(6)(iii) thereunder.\24\
---------------------------------------------------------------------------

    \23\ 15 U.S.C. 78s(b)(3)(A).
    \24\ 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 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.
---------------------------------------------------------------------------

    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-NYSEArca-2014-127 on the subject line.

Paper Comments

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

All submissions should refer to File Number SR-NYSEArca-2014-127. 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 such filing will also 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-NYSEArca-2014-127 and should
be submitted on or before December 12, 2014.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\25\
---------------------------------------------------------------------------

    \25\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2014-27570 Filed 11-20-14; 8:45 am]
BILLING CODE 8011-01-P


[Federal Register Volume 84, Number 128 (Wednesday, July 3, 2019)]
[Proposed Rules]
[Pages 31826-31831]
[FR Doc No: 2019-14251]

-----------------------------------------------------------------------

ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 300

[EPA-HQ-SFUND-1989-0008; FRL-9996-05-Region 3]

National Oil and Hazardous Substances Pollution Contingency Plan;
National Priorities List: Deletion of the Strasburg Landfill Superfund
Site

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule; notice of intent.

-----------------------------------------------------------------------

SUMMARY: The Environmental Protection Agency (EPA) Region 3 is issuing
a Notice of Intent to Delete the Strasburg Landfill Superfund Site
(Site) located in Newlin and West Bradford Townships, Chester County,
Pennsylvania from the National Priorities List (NPL) and requests
public comments on this proposed action. The NPL, promulgated pursuant
to section 105 of the Comprehensive Environmental Response,
Compensation, and Liability Act (CERCLA) of 1980, as amended, is an
appendix of the National Oil and Hazardous Substances Pollution
Contingency Plan (NCP). The EPA and the Commonwealth of Pennsylvania,
through the Pennsylvania Department of Environmental Protection (PADEP,
Southeast Region), have determined that all appropriate response
actions under CERCLA, other than operation and maintenance (O&M),
monitoring, and Five-Year Reviews, have been completed. However, this
deletion does not preclude future actions under Superfund.

DATES: Comments must be received by August 2, 2019.

ADDRESSES: Submit your comments, identified by Docket ID no. EPA-HQ-
SFUND-1989-0008, by one of the following methods:
     https://www.regulations.gov. Follow on-line instructions
for submitting comments. Once submitted, comments cannot be edited or
removed from Regulations.gov. The EPA may publish any comment received
to its public docket. Do not submit electronically any information you
consider to be Confidential Business Information (CBI) or other
information whose disclosure is restricted by statute. Multimedia
submissions (audio, video, etc.) must be accompanied by a written
comment. The written comment is considered the official comment and
should include discussion of all points you wish to make. The EPA will
generally not consider comments or comment contents located outside of
the primary submission (i.e., on the web, cloud, or other file sharing
system). For additional submission methods, the full EPA public comment
policy, information about CBI or multimedia submissions, and general
guidance on making effective comments, please visit https://www2.epa.gov/dockets/commenting-epa-dockets.
     Email<EMAIL_ADDRESS>     Mail: USEPA Region III, 1650 Arch Street, Philadelphia, PA
19103.
     Hand delivery: USEPA Region III, 1650 Arch Street,
Philadelphia, PA 19103. Such deliveries are only accepted during the
Docket's normal hours of operation, and special arrangements should be
made for deliveries of boxed information.
    Instructions: Direct your comments to Docket ID no. EPA-HQ-SFUND-
1989-0008. EPA's policy is that all comments received will be included
in the public docket without change and may be made available online at
https://www.regulations.gov, including any personal information
provided, unless the comment includes information claimed to be
Confidential Business Information (CBI) or other information whose
disclosure is restricted by statute. Do not submit information that you
consider to be CBI or otherwise protected through https://www.regulations.gov or email. The https://www.regulations.gov website
is an ``anonymous access'' system, which means EPA will not know your
identity or contact information unless you provide it in the body of
your comment. If you send an email comment directly to EPA without
going through https://www.regulations.gov, your email

address will be automatically captured and included as part of the
comment that is placed in the public docket and made available on the
internet. If you submit an electronic comment, EPA recommends that you
include your name and other contact information in the body of your
comment and with any disk or CD-ROM you submit. 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. Electronic
files should avoid the use of special characters, any form of
encryption, and be free of any defects or viruses.
    Docket: All documents in the docket are listed in the https://www.regulations.gov index. Although listed in the index, some
information is not publicly available, e.g., CBI or other information
whose disclosure is restricted by statute. Certain other material, such
as copyrighted material, will be publicly available only in the hard
copy. Publicly available docket materials are available either
electronically in https://www.regulations.gov or in hard copy at: USEPA
Region III Administrative Records Room: 1650 Arch Street--6th Floor,
Philadelphia, PA 19103-2029,<PHONE_NUMBER>, Business Hours: Monday
through Friday, 8:00 a.m.-4:30 p.m.; by appointment only.
    Local Repository: Kennett Library, 216 East State Street, Kennett
Square, PA 19348,<PHONE_NUMBER>, Business Hours: Monday through
Friday, 9:00 a.m.-8:00 p.m.

SUPPLEMENTARY INFORMATION:

Table of Contents

I. Introduction
II. NPL Deletion Criteria
III. Deletion Procedures
IV. Basis for Intended Site Deletion

I. Introduction

    EPA Region 3 announces its intent to delete the Strasburg Landfill
Superfund Site from the NPL and requests public comment on this
proposed action. The NPL constitutes Appendix B of 40 CFR part 300
which is the NCP, which EPA promulgated pursuant to section 105 of the
CERCLA of 1980, as amended. EPA maintains the NPL as the list of sites
that appear to present a significant risk to public health, welfare, or
the environment. Sites on the NPL may be the subject of remedial
actions financed by the Hazardous Substance Superfund (Fund). As
described in 40 CFR 300.425(e)(3) of the NCP, sites deleted from the
NPL remain eligible for Fund-financed remedial actions if future
conditions warrant such actions.
    EPA will accept comments on the proposal to delete this site for
thirty (30) days after publication of this document in the Federal
Register.
    Section II of this document explains the criteria for deleting
sites from the NPL. Section III discusses procedures that EPA is using
for this action. Section IV discusses the Strasburg Landfill Superfund
Site and demonstrates how it meets the deletion criteria.

II. NPL Deletion Criteria

    The NCP establishes the criteria that EPA uses to delete sites from
the NPL. In accordance with 40 CFR 300.425(e), sites may be deleted
from the NPL where no further response is appropriate. In making such a
determination pursuant to 40 CFR 300.425(e), EPA will consider, in
consultation with the Commonwealth, whether any of the following
criteria have been met:
    (1) Responsible parties or other persons have implemented all
appropriate response actions required;
    (2) All appropriate Fund-financed response under CERCLA has been
implemented, and no further response action by responsible parties is
appropriate; or
    (3) The remedial investigation has shown that the release poses no
significant threat to public health or the environment and, therefore,
the taking of remedial measures is not appropriate.
    Pursuant to CERCLA section 121(c) and the NCP, EPA conducts Five-
Year Reviews to ensure the continued protectiveness of remedial actions
where hazardous substances, pollutants, or contaminants remain at a
site above levels that allow for unlimited use and unrestricted
exposure. EPA conducts such Five-Year Reviews even if a site is deleted
from the NPL. EPA may initiate further action to ensure continued
protectiveness at a deleted site if new information becomes available
that indicates it is appropriate. Whenever there is a significant
release from a site deleted from the NPL, the deleted site may be
restored to the NPL without application of the hazard ranking system.

III. Deletion Procedures

    The following procedures apply to deletion of the Site:
    (1) EPA consulted with the Commonwealth of Pennsylvania before
developing this Notice of Intent to Delete;
    (2) EPA has provided the Commonwealth of Pennsylvania 30 working
days for review of this notice prior to publication of it today;
    (3) In accordance with the criteria discussed above, EPA has
determined that no further response is appropriate;
    (4) The Commonwealth of Pennsylvania, through PADEP (Southeast
Region), has concurred with deletion of the Site from the NPL;
    (5) Concurrently with the publication of this Notice of Intent to
Delete in the Federal Register, a notice is being published in a major
local newspaper, the Daily Local News. The newspaper notice announces
the 30-day public comment period concerning the Notice of Intent to
Delete the site from the NPL;
    (6) The EPA placed copies of documents supporting the proposed
deletion in the deletion docket and made these items available for
public inspection and copying at the Site information repositories
identified above.
    If comments are received within the 30-day public comment period on
this document, EPA will evaluate and respond appropriately to the
comments before making a final decision to delete. If necessary, EPA
will prepare a Responsiveness Summary to address any significant public
comments received. After the public comment period, if EPA determines
it is still appropriate to delete the Site, the Regional Administrator
will publish a final Notice of Deletion in the Federal Register. Public
notices, public submissions and copies of the Responsiveness Summary,
if prepared, will be made available to interested parties and in the
site information repositories listed above.
    Deletion of a site from the NPL does not itself create, alter, or
revoke any individual's rights or obligations. Deletion of a site from
the NPL does not in any way alter EPA's right to take enforcement
actions, as appropriate. The NPL is designed primarily for
informational purposes and to assist EPA management. Section
300.425(e)(3) of the NCP states that the deletion of a site from the
NPL does not preclude eligibility for future response actions, should
future conditions warrant such actions.

IV. Basis for Intended Site Deletion

    The following information provides EPA's rationale for deleting the
Site from the NPL:

Site Background and History

    EPA proposed the Site (EPA ID PAD000441337) to the NPL on June 24,
1988 (53 FR 23978) and added the Site to the NPL on March 31, 1989 (54
FR 13296). The Site is located south and slightly east of Strasburg
Road in

Newlin Township, Chester County, Pennsylvania.
    The Site includes a 24-acre inactive landfill located on two
parcels totaling approximately 209 acres of undeveloped land. In
addition to the 209 acres, the Site also includes an access road on a
14.5-acre parcel that provides access from Strasburg Road to the Site.
The access road is located in Newlin and West Bradford Townships. The
topography of the area is characterized by a combination of steep and
gentle hills. In general, the land in the Site area slopes towards, and
drains to the Brandywine Creek, or Briar Run, a tributary. These
streams form the eastern and western boundaries of the Site area. A
small wetlands area has been created on the eastern side of the
landfill along Briar Run. The wetlands receive the discharge from the
Site's leachate collection system prior to ultimately discharging into
Briar Run. Groundwater flow at the Site is to the south, southwest, and
southeast.
    Land use in the area is primarily suburban residential, with some
residual agricultural areas. There are more than 300 single family
residences within a one-mile radius of the Site. The drinking water to
these residences is primarily supplied from groundwater. Most of the
homes are served by private home wells. A 57-acre parcel, adjacent to
the two parcels on which the landfill is situated and abutting
Strasburg Road, was acquired by West Bradford Township in August 2007
through a property sheriff sale. The West Bradford parcel is currently
used for township lawn waste composting.
    The Site began to accept municipal and industrial waste in 1978.
The landfill operators were cited by PADEP for numerous operational
violations, and the landfill was closed in 1984. During its period of
operation, the landfill accepted approximately three million cubic
yards of waste. Following closure, the landfill began discharging
leachate into the surrounding area, including Briar Run.
    Initial sampling on and around the landfill showed elevated levels
of vinyl chloride (VC) and trichloroethene (TCE) both in leachate seeps
emanating from the landfill and also in home wells adjacent to the
Site. Subsequent inspections and sampling showed that the existing
landfill cap had failed in numerous locations and that contaminants
were flowing both into nearby surface water streams and into the
groundwater.
    PADEP required the landfill operators to collect the leachate and
transport it offsite for treatment at a nearby municipal sewage
treatment plant. The leachate was collected until July 1989 when the
landfill operators gave notice that they would no longer operate the
leachate collection system. PADEP operated the system on an interim
basis until EPA took over operations of the temporary leachate
collection system in September 1989.

Remedial Investigation (RI) and Feasibility Study (FS)

    The RI for the Site was performed by Ecology and Environment, Inc.
(E&E) for EPA beginning in March 1989 to assess the nature and extent
of contamination and document the potential for contaminant migration
from the Site.
    E&E field activities conducted during the RI included:
     Installation of four shallow (MW-1S, MW-2S, MW-3S, and MW-
4S) and five intermediate depth (MW1I, MW-2I, MW-3I, MW-4I, and MW-5I)
downgradient monitoring wells;
     Sampling and analysis of soils extracted during well
installation;
     Surface water, sediment, and bioassay sampling from onsite
locations and locations in Briar Run and Brandywine Creek;
     Soil gas sampling at a grid area southeast of the landfill
and around the landfill perimeter;
     Packer injection testing of the intermediate-depth
monitoring wells;
     Packer production testing of both shallow (120 feet total
depth) and deep (300 feet total depth) residential wells;
     Residential well sampling and analysis;
     Sampling and analysis of new monitoring wells installed in
1990 and well M5, installed in 1984; and
     Ambient air sampling.
    Contaminants of concern (COCs) at the Site included volatile and
base-neutral organics and selected inorganics. Volatile organic
compounds (VOCs) were detected in ambient air, soil gas, soil,
groundwater, surface water, sediment, and seep areas. The distribution
of base-neutral and inorganic contamination was limited primarily to
the sediment and water in the seep areas and in the sediment pond. The
observed contaminant distribution reflected the differing mobilities of
the different compounds, with the widest distribution observed in the
most mobile class of compounds, VOCs. Tetrachloroethene (TCE), VC, and
1,2-dichloroethene (1,2-DCE) were the most widespread contaminants
identified at this Site.
    Mechanisms for transport of organic compounds from the landfill
included landfill gas emissions that elevate contaminants in the
ambient air and soil gas. Gas emissions escaping through the landfill
cover were measured at selected locations on the landfill using a
stainless steel flux box. Elevated concentrations of PCE (up to 567
parts per billion (ppb)) and VC (up to 129 ppb) were measured in the
gas collected in the flux box samples. Soil gas concentrations measured
at perimeter locations surrounding the landfill had generally high
concentrations of VOCs, with concentrations up to 11,000 ppb VC and up
to 3,000 ppb PCE. Although maximum VOC concentrations detected in
ambient air samples (0.09 ppb PCE, 0.48 ppb VC, and 0.64 ppb 1,2-DCE)
were much lower than concentrations detected in the soil gas, levels
still exceeded background ambient air concentrations.
    Precipitation entering the landfill through the cap generated
leachate and provided an additional mechanism for contaminant
migration. Leachate generated by the landfill was contaminated with
organic and inorganic compounds. Once generated, leachate migrated from
the landfill to the underdrain system, to the surface water as seeps
via interflow, and to the groundwater. Surface water collected from the
seeps and on the surrounding landfill indicated elevated concentrations
of VC (19 micrograms per liter)([mu]g/L) and cis-1,2-DCE (54 [mu]g/L)
likely to have been derived from landfill leachate. Elevated
concentrations of PCE (214 [mu]g/L); 1,2-DCE (129 [mu]g/L); and VC
(19.5 [mu]g/L) were detected in groundwater downgradient of the
landfill.
    Two homes located downgradient of the landfill had relatively low
levels of VOCs in their water supply wells (up to 80.8 [mu]g/L total
VOCs.) These homes were equipped with whole-house point-of-use carbon
filters to provide potable water by EPA in 1989, as described in
additional detail in the following section.
    A diversity of ecological resources exists in the area surrounding
the landfill. These resources include river, wetland, forest, and open
field ecosystems that harbor abundant wildlife populations. Exposure of
plants and wildlife to landfill contaminants appeared to be limited to
seep areas and soil on the landfill perimeter, with some limited
evidence of potential exposure to aquatic biota in areas downstream
from the Site. For aquatic and terrestrial life residing on the
landfill perimeter and having frequent contact with contaminant source
areas, there was a potential risk of toxic effects of contamination.

Response Actions

    The remedial action objectives (RAOs) for the Site, as described in
the Site decision documents, are to minimize migration of contaminants
to ground and surface waters and to prevent direct contact with, or
ingestion of, contaminants.
    EPA divided the cleanup of the Site into four operable units (OUs).
EPA issued a series of Records of Decision (RODs) for the OUs, which
selected the remedies necessary to protect human health and the
environment from contaminants at the Site. The first ROD for OU1, dated
June 29, 1989, addressed leachate releases into surface water and
groundwater near the landfill. The selected remedy was to collect
leachate and treat and dispose of it offsite, as well as provide point-
of-use carbon treatment for contaminated residential wells.
    However, the potentially responsible parties (PRPs) ceased
performing work at the Site in July 1989. Because the PRPs ceased the
offsite disposal of collected leachate, the selected remedy outlined in
the June 1989 ROD was no longer considered adequate. The first
Explanation of Significant Differences (ESD) was issued on January 3,
1990 to change the method of leachate treatment to onsite treatment via
air-stripping and discharge to Briar Run. The onsite treatment system
was constructed from March 1990 through March 1991 and the Remedial
Action for OU1 was approved on March 27, 1991.
    In 1989, EPA installed whole-house carbon filtration systems in two
private residences down gradient of the Site. EPA monitored and
maintained the systems until PADEP took over responsibility for
Operation and Maintenance (O&M) for the Site in 2001. No Site-related
contaminants have been detected at levels exceeding the Maximum
Contaminant Levels (MCLs) in any wells prior to treatment since 1995.
PADEP maintained the carbon units and monitored the groundwater from
the residential wells pre-filter and post-filter until 2010 when
maintenance and monitoring of the residential systems was discontinued
based on the many years of sampling results not exceeding MCLs and the
stability of the plume.
    The second ROD for OU2, dated June 28, 1991, addressed Site access
and security. EPA installed a security fence with warning signs around
the entire perimeter of the landfill from October through December
1992. The Remedial Action for OU2 was approved on December 23, 1992.
    Pursuant to the ROD for OU3, dated March 31, 1992, EPA constructed
a multi-layer cap over the landfill portion of the Site, a landfill
subsurface leachate collection system, and a leachate treatment system,
from August 1996 through September 1999. The Remedial Action for OU3
was approved on September 29, 2000. The landfill was re-graded,
creating less steep slopes, which conformed to the current landfill
grading practices. All of the weeds, brush, and small trees, which had
grown up on the landfill, were removed and an impermeable liner was
placed over the entire landfill area. Approximately 600,000 cubic yards
of earthen material was placed over the landfill as part of this
reconstruction.
    The leachate treatment system actively treated all leachate from
the landfill until 2010. Following the successful pilot test in 2009-
2010, the onsite wetland now serves as a passive treatment system for
the leachate. The leachate, after being distributed via underground
level spreaders in the up-gradient portions of the wetland, eventually
discharges to Briar Run. A gas-flare system which collected and safely
burned gases developed in the landfill has been operated since 1999.
However, due to a decrease in the volume of gas generated by the
landfill, operation of the flare has become difficult. PADEP requested
and EPA evaluated a change to passive gas venting for the Site. This
request was approved by EPA in April 2016.
    Finally, on September 27, 1999, EPA issued a ``No Action'' ROD for
groundwater associated with the Site (OU4). This decision was based on
groundwater data which demonstrated that Site-related contaminants were
not migrating offsite from under the landfill cap.
    The Preliminary Close Out Report (PCOR), documenting construction
completion at the Site, was issued on September 27, 1999. Under the
terms of the Superfund State Contract (SSC), PADEP has maintained and
operated the Site remedies since 2001. EPA issued the Final Close Out
Report (FCOR) on March 18, 2019 to document that all response actions
at the Site had been successfully completed in accordance with Close
Out Procedures for National Priorities List Sites (OSWER Directive
9320.2-22, May 2011).

Institutional Controls (ICs)

    ICs for the Site were developed as a result of recommendations in
the 2010 Five-Year Review. The required ICs were selected via a second
ESD dated September 4, 2012. The ICs selected for the Site include the
following:
     Prohibit activities on the Site within or near the
existing security fencing that would in any manner disturb or interfere
with the remedial systems, including the landfill cap, gas vents,
monitoring wells, leachate collection and conveyance system, and
security measures that prevent access to the landfill. Such prohibited
activities include, but are not limited to, digging in the landfill cap
or tampering with the hardware associated with the gas vents,
monitoring wells, leachate collection and conveyance systems, or the
security fencing.
     Prohibit any use of landfill leachate unless approved by
the EPA, in consultation with PADEP, to avoid exposure to contaminants
in the leachate via ingestion, vapor inhalation or dermal contact.
     Prohibit installation of groundwater wells on the Site
within the existing security fencing without notice and approval of the
EPA, in consultation with PADEP, to avoid exposure to contaminants in
groundwater via ingestion, inhalation, or dermal contact.
     Prohibit installation and pumping of new groundwater wells
within one-quarter of a mile of the identified plume of the Site which
may influence the Site hydrology without notice and approval of EPA, in
consultation with PADEP, to avoid the migration of contaminants from
under the cap and exposure to contaminants in groundwater via
ingestion, inhalation, or dermal contact.
    The ICs have been implemented through an Environmental Covenant
(EC) recorded by the landfill property owner with the Chester County
Recorder of Deeds on December 27, 2013. The EC describes the following
activity and use limitations the property owner shall abide by:
     Any and all activity on the Property that could in any
manner disturb or interfere with the selected remedial systems,
including the landfill cap, gas vents, monitoring wells, leachate
collection and conveyance system, and security measures that prevent
access to the landfill, is prohibited;
     Any and all contact, handling, or use of landfill leachate
is prohibited without the prior written approval of the Agencies;
     The installation of groundwater wells on the property
within the existing fencing is prohibited without the prior written
approval of the Agencies; and
     The installation and pumping of new groundwater wells on
the Property within one-quarter mile of the identified plume is
prohibited without the prior written approval of the Agencies.

    In addition, the Natural Lands Trust, Inc. (NLT), a non-profit
conservancy, accepted a conservation easement from the property owner
for portions of the property to permanently protect natural features of
the property including: Deciduous woodlands, steep slopes, a cold-water
stream and breeding bird habitat, etc. in October 2014.
    Finally, via the 2012 ESD, EPA implemented ICs placing restrictions
on installation and pumping of new groundwater wells within one-quarter
of a mile of the identified plume through application of the Chester
County Health Department (CCHD) regulations relating to installation of
wells in the county. The CCHD regulations require a permit for any new
supply wells prior to installation. The CCHD regulations also require
sampling of any new well installed to demonstrate that it meets
drinking water standards before permission from the CCHD is granted to
use the new well for drinking purposes.

Cleanup Levels

    In a letter dated December 12, 2013, PADEP requested that EPA
consider removing groundwater monitoring from PADEP's O&M obligations
at the Site. EPA evaluated the request as a part of the 2015 Five-Year
Review and determined that the frequency of sampling could be reduced
from the biannual sampling requirement to a frequency of one sampling
event per Five-Year Review cycle, to occur no later than the fourth
year of the Five-Year Review cycle. Groundwater monitoring will
continue to be performed by PADEP once every Five-Year Review cycle.
    The most recent sampling events occurred on April 2010 and March
2014 as a part of the 2015 Five-Year Review. Onsite and perimeter wells
were sampled at this time. The 1999 OU4 ROD selected No Action for
groundwater, therefore, no groundwater cleanup levels exist for the
Site. However, for the purposes of evaluating the groundwater
monitoring results, detected contaminant concentrations were compared
to MCLs for contaminants with MCLs or to PADEP Land Recycling Program
(Act 2) SHS MSCs for a residential used aquifer for contaminants
without MCLs. In reviewing all the historic data, including the two
most recent sampling events, it was determined that were no exceedances
of the MCLs or MSCs. This remains consistent with EPA's No Action
determination for groundwater in the 1999 ROD and supports the
determination that the other remedial actions are operating as
intended.
    As indicated above, no Site-related contaminants have been detected
in residential wells at concentrations exceeding the MCLs since 1995
and sampling and O&M of the systems was discontinued in 2010.
Additionally, because no Site-related contaminants have been detected
in the landfill monitoring wells exceeding MCLs or MSCs, there is no
potential for future impacts to residential wells from the Site.

Operation and Maintenance

    In accordance with the SSC, PADEP has been responsible for O&M of
the remedy components at the Site since September 2011. The leachate
collection and treatment system treated and discharged an approximate
total of 6,153,000 gallons of leachate since PADEP assumed
responsibility. As mentioned earlier, the mechanical leachate treatment
system was deactivated in 2010, and the onsite wetland now serves as a
passive treatment system for removal of the low concentrations of
contaminants from the leachate.
    The leachate, after being distributed via underground level
spreaders in the up-gradient portions of the wetland, eventually
discharges to Briar Run. The National Pollutant Discharge Elimination
System (NPDES) equivalent discharge criteria was modified by PADEP's
water program on August 2, 2013 for leachate discharge to Briar Run
through passive wetlands treatment system modifications. All NPDES
equivalent discharge criteria have been attained since 2013 and no
problems or issues have been identified with the passive treatment
system to date.
    Groundwater monitoring as a component of O&M will continue to be
performed by PADEP no later than the fourth year of every Five-Year
Review cycle.
    During the most recent Five-Year Review period, in the spring,
summer and fall months, the landfill cap was routinely mowed
approximately 6-8 times per year. The landfill vegetative cover has
maintained its integrity, with no major erosion issues. EPA has
recommended that PADEP evaluate low maintenance caps planted with
native vegetation to reduce or eliminate mowing and increase habitat
for wildlife.

Five-Year Review

    Pursuant to CERCLA section 121(c) and as provided in the current
guidance on Five-Year Reviews, Comprehensive Five-Year Review Guidance
(OSWER Directive 9355.7-03B-P, June 2001), EPA must conduct a statutory
Five-Year Review if hazardous substances remain on-site above levels
that would not allow for unlimited use and unrestricted exposure.
Statutory Five-Year Reviews have been conducted at the Site in 1994,
1999, 2005, 2010 and 2015. The Protectiveness Statement in the 2015
Fifth Five-Year Review was as follows: ``The remedies have been
implemented at this Site and are protective of human health and the
environment. Institutional controls were identified and selected in the
September 4, 2012 Second ESD for the Site and are being implemented
through an Environmental Covenant recorded December 27, 2013, and
additionally, through Chester County Health Department regulations
relating to well installation. These ICs will be used to prevent
exposure to waste and contaminated groundwater and to preserve the
integrity of the components of the remedies (cap, fence, leachate
collection and treatment system, etc.). The Site operation and
maintenance and sampling plans should be updated to reflect changes in
site operations, maintenance and sampling plan that are not consistent
with current Site conditions.''
    The only issue and recommendation from the 2015 Five-Year Review
was to ``Update the O&M and Sampling Plan.'' This issue and
recommendation were addressed in October 2016 when an updated O&M and
Sampling Plan was submitted to and approved by EPA. Data collected
since the 2015 Five-Year Review does not call into question any of the
findings presented in that report.
    The next Five-Year Review for this Site is scheduled to be
completed in April 2020 and every five years thereafter.

Community Involvement

    EPA community relations staff conducted an active campaign to
ensure that the residents were well informed about activities at the
Site. Community relations activities included the following:

 Interviews of Township officials for Five-Year Reviews
 Fact Sheets

    In accordance with the requirements of 40 CFR 300.425(e)(4), EPA's
community involvement activities associated with this deletion will
consist of placing the deletion docket in the local Site information
repository and placing a public notice of EPA's intent to delete the
Site from the NPL in the Daily Local News, a major local newspaper of
general circulation. EPA is also providing a 30-day comment period and
will respond to significant comments and significant data in

accordance with 40 CFR 300.425(e)(4)(iii)(iv).

Determination That the Site Meets the Criteria for Deletion in the NCP

    Construction completion for the Site was documented in the
Preliminary Closeout Report (PCOR), dated September 27, 1999. Site
completion was documented in the Final Closeout Report (FCOR), dated
March 18, 2019. All RAOs, performance standards, and cleanup levels
established in the 1989 OU1 ROD, 1990 ESD, 1991 OU2 ROD, 1992 OU3 ROD,
1999 OU4 ROD, and the 2012 ESD have been achieved at the Site, and the
Selected Remedy is protective of human health and the environment. ICs
are in place and effective. No further Superfund response actions,
other than O&M, monitoring, and Five-Year Reviews, are necessary to
protect human health and the environment.
    The procedures specified in 40 CFR 300.425(e) have been followed
for the deletion of the Site. EPA, with concurrence of the Commonwealth
of Pennsylvania through the PADEP, has determined that all appropriate
response actions under CERCLA have been completed. Therefore, EPA is
issuing this Notice of Intent to Delete the Site from the NPL.

List of Subjects in 40 CFR Part 300

    Environmental protection, Air pollution control, Chemicals,
Hazardous waste, Hazardous substances, Intergovernmental relations,
Penalties, Reporting and recordkeeping requirements, Superfund, Water
pollution control, Water supply.

    Authority: 33 U.S.C. 1321(d); 42 U.S.C. 9601-9657; E.O. 13626,
77 FR 56749, 3 CFR, 2013 Comp., p. 306; E.O. 12777, 56 FR 54757, 3
CFR, 1991 Comp., p. 351; E.O. 12580, 52 FR 2923, 3 CFR, 1987 Comp.,
p. 193.

    Dated: June 20, 2019.
Cosmo Servidio,
Regional Administrator, EPA Region III.
[FR Doc. 2019-14251 Filed 7-2-19; 8:45 am]
BILLING CODE 6560-50-P


Comment Info: =================

General Comment:A 75 day period of time for review is insufficient. Please extend the review time period to 180 days. Thank you.


[Federal Register Volume 78, Number 18 (Monday, January 28, 2013)]
[Notices]
[Pages 5864-5865]
[FR Doc No: 2013-01670]

-----------------------------------------------------------------------

DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

Waiver of Aeronautical Land-Use Assurance: Outagamie County
Regional Airport (ATW), Appleton, WI

AGENCY: Federal Aviation Administration, DOT.

ACTION: Notice of intent of waiver with respect to land.

-----------------------------------------------------------------------

SUMMARY: The Federal Aviation Administration (FAA) is considering a
proposal from Outagamie County Regional Airport (Sponsor), Appleton,
WI, to release a 77.5-acre parcel of land from the federal obligation
dedicating it to aeronautical use and to authorize this parcel to be
used for revenue-producing, nonaeronautical purposes.

DATES: Comments must be received on or before February 27, 2013.

ADDRESSES: Mr. Daniel J. Millenacker, Program Manager, Federal Aviation
Administration, Airports District Office, 6020 28th Avenue South, Room
102, Minneapolis, MN 55450-2706. Telephone Number<PHONE_NUMBER>; FAX
Number<PHONE_NUMBER>; email address<EMAIL_ADDRESS>
Documents reflecting this FAA action may be reviewed at the following
locations: Federal Aviation Administration, Minneapolis Airports
District Office, 6020 28th Avenue South, Room 102, Minneapolis, MN
55450-2706; or Office of Airport Director, Outagamie County Regional
Airport, W6390 Challenger Drive, Suite 201, Appleton, WI 54914.

FOR FURTHER INFORMATION CONTACT: Mr. Daniel J. Millenacker, Program
Manager, Federal Aviation Administration, Airports District Office,
6020 28th Avenue South, Room 102, Minneapolis, MN 55450-2706. Telephone
Number<PHONE_NUMBER>; FAX Number<PHONE_NUMBER>; email address
<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION: The parcel of land is located along the
southern boundary of Outagamie County Regional Airport. The parcel will
be used for construction and operation of a Public Safety Training
Center (PSTC) by the Fox Valley Technical College (FVTC). The PSTC is
an educational campus intended to provide degree/diploma/certificate
programs to students enrolled in public safety disciplines including
fire protection, law enforcement, and emergency medical services.
    No airport landside or airside facilities are presently located on
this parcel nor is airport development contemplated in the future.
Development of the parcel for airside or landside operations is largely
restricted due to significant grade differences which exist on the land
surface. Current use of the surface of the parcel is for agricultural
purposes. The parcel presently serves the primary purpose of protecting
airport aeronautical (imaginary) surfaces. The parcel will continue to
serve in this same capacity with a proposed change to nonaeronautical,
revenue-producing use from its present aeronautical use designation.
    The parcel is depicted on the Airport Layout Plan (ALP) dated
January 13, 1993, and the Exhibit ``A'' property map. This parcel, as
shown on the ALP, is not needed for aeronautical use. There are no
impacts to the airport by allowing it to waive the requirement to
maintain the parcel as aeronautical use.
    Of the 77.5 acres, approximately 74.5 acres were originally
purchased with sponsor funds. The remaining acres were acquired under a
larger land acquisition grant, Airport Improvement Program (AIP) Grant
No. 3-55-0002-30-06.
    A fair market value (FMV) appraisal for the parcel was completed in
2011 in accordance with FAA Order 5100.37A. The appraisal concluded
that the FMV for acquisition of the parcel was $1,369,000. A standard
capitalization rate was applied to the FMV to establish a base annual
rent to be paid by FVTC for use of the parcel. A lease agreement
established by the airport sponsor defines leasehold terms and
conditions. The airport sponsor understands that rent and all other
revenue that it collects in connection with the PSTC campus will be
considered airport revenue and used in accordance with 49 U.S.C.
Sections 47107 and 47133; FAA's Policy and Procedures on the Use of
Airport Revenue; and FAA Order 51960.6B titled, ``Airport Compliance
Manual.'' The annual income from rent payment will generate a long-
term, revenue-producing stream that will further the Sponsor's
obligation under FAA Grant Assurance No. 24 to make the airport as
financially self-sufficient as possible.
    The sponsor will control FVTC's use of the parcel through the terms
and conditions of the ground lease. The lease will be subordinate to
the sponsor's existing grant assurances. This will ensure that all
activities contemplated on the parcel will be compatible with FAA
requirements and airport operations.
    An environmental assessment addressing proposed development of the
parcel was prepared. A Federal Finding of No Significant Impact was
issued by FAA on Dec. 28, 2012.

    In accordance with section 47107(h) of title 49, United States
Code, this notice is required to be published in the Federal Register
30 days before modifying the land-use assurance that requires the
property to be used for an aeronautical purpose.
    Following is a legal description of the subject airport property at
the Outagamie County Regional Airport in Appleton, WI:
    A parcel of land being a part of the Southeast Quarter of the
Southeast Quarter of Section 35, the Northwest Quarter of the Southwest
Quarter, the Southwest Quarter of the Southwest Quarter and the
Southeast Quarter of the Southwest Quarter of Section 36, T21N, R16E,
Town of Greenville, Outagamie County, Wisconsin more fully described as
follows:
    Commencing at the South Quarter Corner of Section 36; Thence
S89[deg]57'00'' W coincident with the South line of the Southwest
Quarter of Section 36 a distance of 470.22 feet; Thence N00[deg]51'03''
E a distance of 49.14 feet to the South right-of-way line of CTH BB
also being the point of beginning. Thence S89[deg]50'39'' W coincident
with said South right-of-way line a distance of 1,098.47 feet; Thence
S89[deg]53'16'' W coincident with said South right-of-way line a
distance of 1,348.82 feet; Thence N00[deg]08'45'' W a distance of
206.41 feet; Thence N90[deg]00'00'' E a distance of 30.49 feet; Thence
N33[deg]46'32'' E a distance of 80.71 feet; Thence N30[deg]09'12'' E a
distance of 99.92 feet; Thence N33[deg]41'24'' W a distance of 10.70
feet; Thence S85[deg]14'11'' W a distance of 71.45 feet; Thence
S78[deg]41'24'' W a distance of 75.64 feet; Thence N85[deg]54'52'' W a
distance of 83.28 feet; Thence N59[deg]02'10'' W a distance of 17.30
feet; Thence N40[deg]48'54'' E a distance of 86.24 feet; Thence
N27[deg]48'05'' E a distance of 553.39 feet; Thence N24[deg]30'26'' E a
distance of 443.43 feet; Thence N05[deg] 11'40'' E a distance of 163.84
feet; Thence N29[deg]07'17'' E a distance of 322.87 feet; Thence
S63[deg]52'35'' E a distance of 1,706.63 feet; Thence N89[deg]51'06'' E
a distance of 803.81 feet to the West right-of-way line of Two Mile
Road; Thence S00[deg]51'03'' W coincident with said West right-of-way
line a distance of 590.25 feet to the North line of Lot 1, Outagamie
County CSM No. 1190; Thence S89[deg]57'16'' W coincident with said
North line a distance of 420.00 feet to the West line of said Lot 1,
Outagamie County CSM No. 1190; Thence S00[deg]51'03'' W coincident with
said West line a distance of 420.89 feet to the point of beginning.
    Said parcel of land contains 77.5 Acres (3,376,192 Square Feet)
more or less.
    Subject to all easements and restrictions of record.

    Issued in Minneapolis, MN, on December 31, 2012.
Daniel J. Millenacker,
Acting Manager, Minneapolis Airports District Office, FAA, Great Lakes
Region.
[FR Doc. 2013-01670 Filed 1-23-13; 4:15 pm]
BILLING CODE 4910-13-P