2023-01578. Order Making Fiscal Year 2023 Annual Adjustments to Transaction Fee Rates  

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    I. Background

    Section 31 of the Securities Exchange Act of 1934 (“Exchange Act”) requires each national securities exchange and national securities association to pay transaction fees to the Commission.[1] Specifically, Section 31(b) requires each national securities exchange to pay to the Commission fees based on the aggregate dollar amount of sales of certain securities (“covered sales”) transacted on the exchange.[2] Section 31(c) requires each national securities association to pay to the Commission fees based on the aggregate dollar amount of covered sales transacted by or through any member of the association other than on an exchange.[3]

    Section 31 of the Exchange Act requires the Commission to annually adjust the fee rates applicable under Sections 31(b) and (c) to a uniform adjusted rate.[4] Specifically, the Commission must adjust the fee rates to a uniform adjusted rate that is reasonably likely to produce aggregate fee collections (including assessments on security futures transactions) equal to the regular appropriation to the Commission for the applicable fiscal year.[5]

    The Commission is required to publish notice of the new fee rates under Section 31 not later than 30 days after the date on which an Act making a regular appropriation for the applicable fiscal year is enacted.[6] On December 29, 2022, the President signed into law the Consolidated Appropriations Act, 2023, which includes total appropriations of $2,209,770,000 to the SEC for fiscal year 2023.

    II. Fiscal Year 2023 Annual Adjustment to the Fee Rate

    The new fee rate is determined by (1) subtracting the sum of fees estimated to be collected prior to the effective date of the new fee rate [7] and estimated assessments on security futures transactions to be collected under Section 31(d) of the Exchange Act for all of fiscal year 2023 [8] from an amount equal to the regular appropriation to the Commission for fiscal year 2023, and (2) dividing by the estimated aggregate dollar amount of covered sales for the remainder of the fiscal year following the effective date of the new fee rate.[9]

    As noted above, the Consolidated Appropriations Act, 2023, includes total appropriations of $2,209,770,000 to the Commission for fiscal year 2023.[10] The Commission estimates that it will collect $1,601,107,658 in fees for the period prior to the effective date of the new fee rate and $0 in assessments on round turn transactions in security futures products during all of fiscal year 2023. Using the methodology described in Appendix A, the Commission estimates that the aggregate dollar amount of covered sales for the remainder of fiscal year 2023 to be $76,211,125,379,350.

    The uniform adjusted rate is computed by dividing the residual fees to be collected of $608,662,342 by the estimated aggregate dollar amount of covered sales for the remainder of fiscal year 2023 of $76,211,125,379,350; this results in a uniform adjusted rate for fiscal year 2023 of $8.00 per million.[11]

    III. Effective Date of the Uniform Adjusted Rate

    Under Section 31(j)(4)(A) of the Exchange Act, the fiscal year 2023 annual adjustments to the fee rates applicable under Sections 31(b) and (c) of the Exchange Act shall take effect on the later of October 1, 2022, or 60 days after the date on which a regular appropriation to the Commission for fiscal year 2023 is enacted.[12] The regular appropriation to the Commission for fiscal year 2023 was enacted on December 29, 2022, and accordingly, the new fee rates applicable under Sections 31(b) and (c) of the Exchange Act will take effect on February 27, 2023.

    IV. Conclusion

    Accordingly, pursuant to Section 31 of the Exchange Act,

    It is hereby ordered that the fee rates applicable under Sections 31(b) and (c) of the Exchange Act shall be $8.00 per $1,000,000 effective on February 27, 2023.

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    By the Commission.

    J. Matthew DeLesDernier,

    Deputy Secretary.

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    Appendix A

    This appendix provides the methodology for determining the annual adjustment to the Start Printed Page 5052 fee rates applicable under Sections 31(b) and (c) of the Exchange Act for fiscal year 2023. Section 31 of the Exchange Act requires the fee rates to be adjusted so that it is reasonably likely that the Commission will collect aggregate fees equal to its regular appropriation for fiscal year 2023.

    To make the adjustment, the Commission must project the aggregate dollar amount of covered sales of securities on the securities exchanges and certain over-the-counter (“OTC”) markets over the course of the year. The fee rate equals the ratio of the Commission's regular appropriation for fiscal year 2023 (less the sum of fees to be collected during fiscal year 2023 prior to the effective date of the new fee rate and aggregate assessments on security futures transactions during all of fiscal year 2023) to the estimated aggregate dollar amount of covered sales for the remainder of the fiscal year following the effective date of the new fee rate.

    For 2023, the Commission has estimated the aggregate dollar amount of covered sales by projecting forward the trend established in the previous decade. More specifically, the dollar amount of covered sales was forecasted for months subsequent to November 2022, the last month for which the Commission has data on the dollar volume of covered sales.[13]

    The following sections describe this process in detail.

    A. Baseline Estimate of the Aggregate Dollar Amount of Covered Sales for Fiscal Year 2023

    First, calculate the average daily dollar amount of covered sales (“ADS”) for each month in the sample (February 2012-November 2022). The monthly total dollar amount of covered sales (exchange plus certain OTC markets) is presented in column C of Table A.

    The model forecasts the monthly moving average of the average daily dollar amount of covered sales. Each month's average daily dollar amount of covered sales is calculated by dividing the total covered sales for that month (column C of Table A) by the number of trading days for that month (column B of Table A). These amounts are shown in column D of Table A. The moving average will span the same number of months required to be forecast for the remainder of the fiscal year. The trailing moving average used in the forecast model is presented in column E of Table A.

    To capture the recent trends in the monthly changes in the moving averages, calculate the 1-month and 2-month lags of the trailing moving average shown in column E in Table A. These amounts are shown in columns F and G, respectively, of Table A.

    Next, model the monthly trailing moving average of ADS as function of a constant term and the two lagged trailing moving averages using the ordinary least squares technique.

    Use the estimated model to forecast the trailing moving average of ADS of the first month after the last available monthly data. Estimate the trailing moving average of the second month using the forecasted value of the first month and the actual value of the month before that. Similarly, estimate the trailing moving average of the third month using the forecasted values of the two previous months. Continue in this fashion until the end of the fiscal year.

    The estimate of the trailing moving average ADS for the last applicable month in the fiscal year is a prediction of the moving average for those months that need to be predicted. This estimate is used as the predicted value of ADS for each month in the forecast period; to obtain the forecast total covered sales for each month, multiply the predicted ADS by the number of days in each month.

    The following is a more formal (mathematical) description of the procedure:

    1. Begin with the monthly data for total dollar volume of covered sales (column C). The sample spans ten years, from February 2012-November 2022.[14] Divide each month's total dollar volume by the number of trading days in that month (column B) to obtain the average daily dollar volume (ADS, column D).

    2. For each month t, calculate the 9-month trailing moving average of ADS (shown in column E). For example, the value for October, 2012 is the average of the 9 months ending in October, 2012, or February 2012 through October 2012 inclusive.

    3. Calculate the 1-month and 2-month lags of the trailing moving average. For example, the 1-month lag of the 9-month trailing moving average for November, 2012 is equal to the 9-month trailing moving average for October, 2012. The 2-month lag of the 9-month trailing moving average for December, 2012 is equal to the 9-month trailing moving average for October 2012. These are shown in columns F and G.

    4. Estimate the model using ordinary least squares:

    yt = α + β1yt-1 + β2yt-2 + ut

    Where yt is the 9-month trailing moving average of the average daily sales for month t, and yt-1 and yt-2 are the 1-month and 2-month lags of yt, and ut representing the error term for month t. The model can be estimated using standard commercially available software. The estimated parameter values are a = +2,150,476,361, b1 = +1.587842, b2 = −0.590472. The root-mean squared error (RMSE) of the regression is 8,030,961,258.

    5. The predicted value of the 9-month trailing moving average of the last month to be forecast represents the final forecast of covered sales for the entire prediction period. This value is shown in column H. This represents the prediction for August of 2023. To calculate this value from the model above, one needs the 1-month and 2-month lag of the 9-month trailing moving average ADS, i.e., the 9-month trailing moving average for June and July. The 9-month trailing moving average for July is obtained by using the 1-month and 2-month lags for July, that is, the 9-month trailing moving averages for June and May. To arrive at all the necessary inputs, one begins with the first month to be forecast, in this case, December 2022, and iterates predictions forward until the last month is predicted. One then multiplies the final predicted 9-month trailing moving average ADS by the number of days in each month to arrive at the forecast total dollar amount of covered sales. This is shown in column I.

    6. For example, for December 2022, using the a, b1, and b2 parameter estimates shown above, along with the 1-month and two-month lags in the 9-month trailing moving average ADS (representing the 9-month trailing moving average ADS for October and November 2022, respectively), one can estimate the forecast 9-month trailing moving average ADS for December: +2,150,476,361 + (1.587842 × 606,143,338,486) + (−0.590472 × 627,874,685,327) = 593,867,637,983.

    7. With the estimated 9-month trailing moving average ADS for December 2022 calculated above, one can estimate the 9-month trailing moving average ADS for January, 2023. The estimate obtained from December becomes the 1-month lag for January, and the 1-month lag used in the December forecast becomes the 2-month lag for the January forecast. Thus, the predicted 9-month trailing moving average ADS for January 2023 is calculated as: +2150476361 + (1.587842 x 593,867,637,983) + (−0.590472 × 606,143,338,486) = 587,207,522,789.

    8. Using the forecasts for December and January, one can estimate the value for February. Repeat this procedure for subsequent months, until the estimate for August 2023 is obtained. This value is 586,239,425,995.[15] This value is then used to calculate the final forecast total monthly covered sales for all 9 months from December 2022 through August 2023.

    9. To obtain the estimate of total monthly covered sales for each month, multiply the number of trading days in the month, shown in column B in Table A, by the final forecast 9-month trailing moving average ADS, shown in column H of Table A. This product is shown in column I of Table A, and these figures are used to calculate the new fee rate.

    B. Using the Forecasts From A To Calculate the New Fee Rate

    1. Use Table A to estimate fees collected for the period September 1, 2022 through February 26, 2023. The projected aggregate dollar amount of covered sales for this period is $69,917,364,964,488. Actual and projected fee collections at the current fee rate of $22.90 per million are $1,601,107,658. Start Printed Page 5053

    2. Estimate the amount of assessments on security futures products collected from September 1, 2022 through August 31, 2023. The only entity reporting assessable security futures products ceased operations in September, 2020.[16] Consequently, the estimated amount of assessments on security futures products collected from September 2022 through August 2023 is zero.

    3. Subtract the amount $1,601,107,658 from the target off-setting collection amount set by Congress of $2,209,770,000, leaving $608,662,342 to be collected on dollar volume for the period February 27, 2023 through August 31, 2023.

    4. Use Table A to estimate dollar volume for the period February 27, 2023 through August 31, 2023. The estimate is $76,211,125,379,350. Finally, compute the fee rate required to produce the additional $608,662,342 in revenue. This rate is $608,662,342 divided by $76,211,125,379,350 or 0.00000798653.

    5. Round the result to the seventh decimal point, yielding a rate of 0.00000800 (or $8.00 per million).

    This table summarizes the estimates of the aggregate dollar amount of covered sales, by time period. The figures in this table can be used to determine the new fee rate.

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    (A)(B)(C)(D)(E)(F)(G)(H)(I)
    Month# of trading days in monthTotal dollar amount of salesAverage daily dollar amount of sales (ADS)9-month trailing moving average ADS1-month lag of 9-month trailing moving average ADS2-month lag of 9-month trailing moving average ADSForecast 9-month trailing moving average ADSForecast total dollar amount of sales
    Feb-1220$5,011,862,514,132$250,593,125,707
    Mar-12225,638,847,967,025256,311,271,228
    Apr-12205,084,239,396,560254,211,969,828
    May-12225,611,638,053,374255,074,456,972
    Jun-12215,121,896,896,362243,899,852,208
    Jul-12214,567,519,314,374217,500,919,732
    Aug-12234,621,597,884,730200,939,038,467
    Sep-12194,598,499,962,682242,026,313,825
    Oct-12215,095,175,588,310242,627,408,967$240,353,817,437
    Nov-12214,547,882,974,292216,565,855,919236,573,009,683$240,353,817,437
    Dec-12204,744,922,754,360237,246,137,718234,454,661,515236,573,009,683$240,353,817,437
    Jan-13215,079,603,817,496241,885,896,071233,085,097,764234,454,661,515236,573,009,683
    Feb-13194,800,663,527,089252,666,501,426232,817,547,148233,085,097,764234,454,661,515
    Mar-13204,917,701,839,870245,885,091,993233,038,129,346232,817,547,148233,085,097,764
    Apr-13225,451,358,637,079247,789,028,958236,403,474,816233,038,129,346232,817,547,148
    May-13225,681,788,831,869258,263,128,721242,772,818,178236,403,474,816233,038,129,346
    Jun-13205,623,545,462,226281,177,273,111247,122,924,765242,772,818,178236,403,474,816
    Jul-13225,083,861,509,754231,084,614,080245,840,392,000247,122,924,765242,772,818,178
    Aug-13224,925,611,193,095223,891,417,868246,654,343,327245,840,392,000247,122,924,765
    Sep-13204,959,197,626,713247,959,881,336247,844,759,285246,654,343,327245,840,392,000
    Oct-13235,928,804,028,970257,774,088,216249,610,113,968247,844,759,285246,654,343,327
    Nov-13205,182,024,612,049259,101,230,602250,325,083,876249,610,113,968247,844,759,285
    Dec-13215,265,282,994,173250,727,761,627250,863,158,280250,325,083,876249,610,113,968
    Jan-14215,808,700,114,288276,604,767,347254,064,906,990250,863,158,280250,325,083,876
    Feb-14196,018,926,931,054316,785,627,950260,567,406,904254,064,906,990250,863,158,280
    Mar-14216,068,617,342,988288,981,778,238261,434,574,140260,567,406,904254,064,906,990
    Apr-14216,013,948,953,528286,378,521,597267,578,341,642261,434,574,140260,567,406,904
    May-14215,265,594,447,318250,742,592,729270,561,805,516267,578,341,642261,434,574,140
    Jun-14215,159,506,989,669245,690,809,032270,309,686,371270,561,805,516267,578,341,642
    Jul-14225,364,099,567,460243,822,707,612268,759,532,970270,309,686,371270,561,805,516
    Aug-14215,075,332,147,677241,682,483,223266,824,116,595268,759,532,970270,309,686,371
    Sep-14215,507,943,363,243262,283,017,297268,108,033,892266,824,116,595268,759,532,970
    Oct-14237,796,638,035,879338,984,262,430275,039,088,901268,108,033,892266,824,116,595
    Nov-14195,340,847,027,697281,097,211,984271,073,709,349275,039,088,901268,108,033,892
    Dec-14226,559,110,068,128298,141,366,733272,091,441,404271,073,709,349275,039,088,901
    Jan-15206,185,619,541,044309,280,977,052274,636,158,677272,091,441,404271,073,709,349
    Feb-15195,723,523,235,641301,238,065,034280,246,766,711274,636,158,677272,091,441,404
    Mar-15226,395,046,297,249290,683,922,602285,246,001,552280,246,766,711274,636,158,677
    Apr-15215,625,548,298,004267,883,252,286287,919,395,405285,246,001,552280,246,766,711
    May-15205,521,351,972,386276,067,598,619291,739,963,782287,919,395,405285,246,001,552
    Jun-15226,005,521,460,806272,978,248,218292,928,322,773291,739,963,782287,919,395,405
    Jul-15226,493,670,315,390295,166,832,518288,059,719,450292,928,322,773291,739,963,782
    Aug-15216,963,901,249,270331,614,345,203293,672,734,252288,059,719,450292,928,322,773
    Sep-15216,434,496,770,897306,404,608,138294,590,872,186293,672,734,252288,059,719,450
    Oct-15226,592,594,708,082299,663,395,822293,522,252,049294,590,872,186293,672,734,252
    Nov-15205,822,824,015,945291,141,200,797292,400,378,245293,522,252,049294,590,872,186
    Dec-15226,384,337,478,801290,197,158,127292,346,293,303292,400,378,245293,522,252,049
    Jan-16196,696,059,796,055352,424,199,792301,739,731,915292,346,293,303292,400,378,245
    Feb-16206,659,878,908,747332,993,945,437308,064,881,562301,739,731,915292,346,293,303
    Mar-16226,161,943,754,542280,088,352,479308,854,893,146308,064,881,562301,739,731,915
    Apr-16215,541,076,988,322263,860,808,968305,376,446,085308,854,893,146308,064,881,562
    May-16215,693,520,415,112271,120,019,767298,654,854,370305,376,446,085308,854,893,146
    Jun-16226,317,212,852,759287,146,038,762296,515,013,328298,654,854,370305,376,446,085
    Jul-16205,331,797,261,269266,589,863,063292,840,176,355296,515,013,328298,654,854,370
    Aug-16235,635,976,607,786245,042,461,208287,718,094,178292,840,176,355296,515,013,328
    Sep-16215,942,072,286,976282,955,823,189286,913,501,407287,718,094,178292,840,176,355
    Oct-16215,460,906,573,682260,043,170,175276,648,942,561286,913,501,407287,718,094,178
    Nov-16216,845,287,809,886325,966,086,185275,868,069,311276,648,942,561286,913,501,407
    Dec-16216,208,579,880,985295,646,660,999277,596,770,257275,868,069,311276,648,942,561
    Start Printed Page 5056
    Jan-17205,598,200,907,603279,910,045,380279,380,018,748277,596,770,257275,868,069,311
    Feb-17195,443,426,609,533286,496,137,344281,088,476,256279,380,018,748277,596,770,257
    Mar-17236,661,861,914,530289,646,170,197281,366,268,638281,088,476,256279,380,018,748
    Apr-17195,116,714,033,499269,300,738,605281,667,477,031281,366,268,638281,088,476,256
    May-17226,305,822,460,672286,628,293,667286,288,125,082281,667,477,031281,366,268,638
    Jun-17226,854,993,097,601311,590,595,346289,469,766,433286,288,125,082281,667,477,031
    Jul-17205,394,333,070,522269,716,653,526290,544,597,917289,469,766,433286,288,125,082
    Aug-17236,206,204,906,864269,834,995,951284,307,810,113290,544,597,917289,469,766,433
    Sep-17205,939,886,169,525296,994,308,476284,457,548,721284,307,810,113290,544,597,917
    Oct-17226,134,529,538,894278,842,251,768284,338,904,987284,457,548,721284,307,810,113
    Nov-17216,289,748,560,897299,511,836,233285,785,093,752284,338,904,987284,457,548,721
    Dec-17206,672,181,323,001333,609,066,150290,669,859,969285,785,093,752284,338,904,987
    Jan-18217,672,288,677,308365,347,079,872301,341,675,665290,669,859,969285,785,093,752
    Feb-18198,725,420,462,639459,232,655,928320,519,938,139301,341,675,665290,669,859,969
    Mar-18218,264,755,011,030393,559,762,430329,627,623,370320,519,938,139301,341,675,665
    Apr-18217,490,308,402,446356,681,352,497339,290,367,701329,627,623,370320,519,938,139
    May-18227,242,077,467,361329,185,339,426345,884,850,309339,290,367,701329,627,623,370
    Jun-18217,936,783,802,579377,942,085,837354,879,047,793345,884,850,309339,290,367,701
    Jul-18216,807,593,326,456324,171,110,784359,915,587,684354,879,047,793345,884,850,309
    Aug-18237,363,115,477,823320,135,455,558362,207,100,942359,915,587,684354,879,047,793
    Sep-18196,781,988,459,996356,946,761,052364,800,178,154362,207,100,942359,915,587,684
    Oct-182310,133,514,482,168440,587,586,181373,160,234,410364,800,178,154362,207,100,942
    Nov-18218,414,847,862,204400,707,041,057366,657,388,314373,160,234,410364,800,178,154
    Dec-18199,075,221,733,736477,643,249,144375,999,997,948366,657,388,314373,160,234,410
    Jan-19217,960,664,643,749379,079,268,750378,488,655,310375,999,997,948366,657,388,314
    Feb-19196,676,391,653,247351,389,034,381380,955,732,527378,488,655,310375,999,997,948
    Mar-19217,828,979,311,928372,808,538,663380,385,338,397380,955,732,527378,488,655,310
    Apr-19216,907,923,076,080328,948,717,909380,916,183,633380,385,338,397380,955,732,527
    May-19227,895,053,976,747358,866,089,852385,219,587,443380,916,183,633380,385,338,397
    Jun-19207,070,583,442,058353,529,172,103384,839,855,338385,219,587,443380,916,183,633
    Jul-19226,792,811,319,721308,764,150,896370,192,806,973384,839,855,338385,219,587,443
    Aug-19228,059,527,400,976366,342,154,590366,374,486,254370,192,806,973384,839,855,338
    Sep-19206,958,132,871,506347,906,643,575351,959,307,858366,374,486,254370,192,806,973
    Oct-19237,235,982,824,882314,607,948,908344,795,827,875351,959,307,858366,374,486,254
    Nov-19206,784,888,230,209339,244,411,510343,446,425,334344,795,827,875351,959,307,858
    Dec-19217,252,856,724,647345,374,129,745340,398,157,677343,446,425,334344,795,827,875
    Jan-20218,178,172,797,805389,436,799,895347,119,055,675340,398,157,677343,446,425,334
    Feb-20198,951,554,790,521471,134,462,659359,593,319,320347,119,055,675340,398,157,677
    Mar-202216,218,726,536,159737,214,842,553402,225,060,481359,593,319,320347,119,055,675
    Apr-202110,289,596,902,933489,980,804,902422,360,244,260402,225,060,481359,593,319,320
    May-20209,435,524,799,540471,776,239,977434,075,142,636422,360,244,260402,225,060,481
    Jun-202212,093,857,552,130549,720,797,824456,498,937,553434,075,142,636422,360,244,260
    Jul-202210,355,334,352,448470,697,016,020473,842,167,232456,498,937,553434,075,142,636
    Aug-20219,763,364,099,611464,922,099,981487,806,354,840473,842,167,232456,498,937,553
    Sep-202111,545,564,207,158549,788,771,769510,519,092,842487,806,354,840473,842,167,232
    Oct-202210,052,383,314,951456,926,514,316518,017,950,000510,519,092,842487,806,354,840
    Nov-202011,039,477,432,965551,973,871,648527,000,106,555518,017,950,000510,519,092,842
    Dec-202212,172,302,216,779553,286,464,399506,563,620,093527,000,106,555518,017,950,000
    Jan-211912,396,479,814,996652,446,306,052524,615,342,443506,563,620,093527,000,106,555
    Feb-211912,103,659,666,497637,034,719,289542,977,395,700524,615,342,443506,563,620,093
    Mar-212316,485,012,205,966716,739,661,129561,535,047,178542,977,395,700524,615,342,443
    Apr-212111,602,282,119,601552,489,624,743570,623,114,814561,535,047,178542,977,395,700
    May-212011,729,455,630,914586,472,781,546584,128,746,099570,623,114,814561,535,047,178
    Jun-212213,038,812,281,463592,673,285,521588,893,692,071584,128,746,099570,623,114,814
    Jul-212111,623,478,100,180553,498,957,151599,623,963,498588,893,692,071584,128,746,099
    Aug-212211,493,350,851,643522,425,038,711596,340,759,838599,623,963,498588,893,692,071
    Sep-212112,312,072,157,576586,289,150,361600,007,724,945596,340,759,838599,623,963,498
    Oct-212112,011,570,888,110571,979,566,100591,066,976,061600,007,724,945596,340,759,838
    Nov-212113,996,377,941,116666,494,187,672594,340,250,326591,066,976,061600,007,724,945
    Start Printed Page 5057
    Dec-212215,494,373,840,971704,289,720,044592,956,923,539594,340,250,326591,066,976,061
    Jan-222016,002,717,162,409800,135,858,120620,473,171,692592,956,923,539594,340,250,326
    Feb-221914,483,452,476,259762,286,972,435640,008,081,791620,473,171,692592,956,923,539
    Mar-222317,089,275,084,128743,011,960,179656,712,378,975640,008,081,791620,473,171,692
    Apr-222013,123,148,685,917656,157,434,296668,118,876,435656,712,378,975640,008,081,791
    May-222115,039,352,606,836716,159,647,945689,644,944,128668,118,876,435656,712,378,975
    Jun-222113,021,062,095,851620,050,575,993693,396,213,643689,644,944,128668,118,876,435
    Jul-222010,112,087,348,637505,604,367,432686,021,191,568693,396,213,643689,644,944,128
    Aug-222311,593,039,396,644504,045,191,158667,971,303,067686,021,191,568693,396,213,643
    Sep-222112,052,452,021,792573,926,286,752653,486,477,146667,971,303,067686,021,191,568
    Oct-222111,962,224,366,908569,629,731,758627,874,685,327653,486,477,146667,971,303,067
    Nov-222111,900,801,868,077566,704,850,861606,143,338,486627,874,685,327653,486,477,146
    Dec-2221606,143,338,486627,874,685,327$586,239,425,995$12,311,027,945,895
    Jan-2320606,143,338,486586,239,425,99511,724,788,519,900
    Feb-2319586,239,425,99511,138,549,093,905
    Mar-2323586,239,425,99513,483,506,797,885
    Apr-2319586,239,425,99511,138,549,093,905
    May-2322586,239,425,99512,897,267,371,890
    Jun-2321586,239,425,99512,311,027,945,895
    Jul-2320586,239,425,99511,724,788,519,900
    Aug-2323586,239,425,99513,483,506,797,885
    Start Printed Page 5058

    End Preamble

    Footnotes

    4.  In some circumstances, the SEC also must make a mid-year adjustment to the fee rates applicable under Sections 31(b) and (c).

    Back to Citation

    5.  15 U.S.C. 78ee(j)(1) (the Commission must adjust the rates under Sections 31(b) and (c) to a “uniform adjusted rate that, when applied to the baseline estimate of the aggregate dollar amount of sales for such fiscal year, is reasonably likely to produce aggregate fee collections under [Section 31] (including assessments collected under [Section 31(d)]) that are equal to the regular appropriation to the Commission by Congress for such fiscal year.”).

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    7.  The sum of fees to be collected prior to the effective date of the new fee rate is determined by applying the current fee rate to the dollar amount of covered sales prior to the effective date of the new fee rate. The exchanges and FINRA have provided data on the dollar amount of covered sales through November, 2022. To calculate the dollar amount of covered sales from December, 2022 to the effective date of the new fee rate, the Commission is using the same methodology it used in fiscal year 2020. This methodology is described in Appendix A of this order.

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    8.  Currently, security futures do not trade on any market, therefore the Commission has not collected any assessments for transactions in security futures. Accordingly, the forecast for the assessments for all of fiscal year 2023 for single stock futures is zero.

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    9.  To estimate the aggregate dollar amount of covered sales for the remainder of fiscal year 2023 following the effective date of the new fee rate, the Commission is using the same methodology it used previously. This methodology is described in Appendix A of this order.

    Back to Citation

    10.  The President signed into law the “Consolidated Appropriations Act, 2023” on December 29, 2022. This legislation included an appropriation of $2,149,000,000 to the SEC for fiscal year 2023 operations. The Act further directed that “[i]n addition to the foregoing appropriation, for move, replication, and related costs associated with a replacement lease for the Commission's District of Columbia headquarters facilities, not to exceed $57,405,000, to remain available until expended; and for move, replication, and related costs associated with a replacement lease for the Commission's San Francisco Regional Office facilities, not to exceed $3,365,000, to remain available until expended.” The sum of these amounts is $2,209,770,000. Finally, the Act further directed that “for purposes of calculating the fee rate under section 31(j) . . . all amounts appropriated under this heading shall be deemed to be the regular appropriation to the Commission for fiscal year 2023.”

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    11.  Appendix A shows the process of calculating the fiscal year 2023 annual adjustment and includes the data used by the Commission in making this adjustment.

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    13.  To determine the availability of data, the Commission compares the date of the appropriation with the date the transaction data are due from the exchanges (10 business days after the end of the month). If the business day following the date of the appropriation is equal to or subsequent to the date the data are due from the exchanges, the Commission uses these data. The appropriation was signed on December 29, 2022. The first business day after this date was December 30, 2022. Data for November were due from the exchanges on December 14, 2022. As a result, the Commission used November 2022 and earlier data to forecast volume for December 2022 and later months.

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    14.  Because the model uses a two period lag in the 9-month trailing moving average of average daily covered sales, ten additional months of data are added to the table so that the model is estimated with 120 observations.

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    15.  One obtains insignificantly different values using the rounded parameter estimates shown above. The predicted ADS values displayed above represents the full precision estimate.

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    16.  Currently, security futures do not trade on any market, therefore the Commission has not collected any assessments for transactions in security futures. Accordingly, the forecast for the assessments for all of fiscal year 2023 for single stock futures is zero.

    Back to Citation

    BILLING CODE 8011-01-P

    BILLING CODE 8011-01-C

    [FR Doc. 2023-01578 Filed 1-25-23; 8:45 am]

    BILLING CODE 8011-01-C

Document Information

Published:
01/26/2023
Department:
Securities and Exchange Commission
Entry Type:
Notice
Document Number:
2023-01578
Pages:
5051-5058 (8 pages)
Docket Numbers:
Release No. 34-96724/January 23, 2023
PDF File:
2023-01578.pdf