At work with pattern at home - though I wish I was there with it now.
So I don't have it in front of me at the moment - but the next step is change to the contrast yarn (which is a lighter weight yarn) and do the 2x2 ribbing (starts with K1, P2 and then *K2, P2* ).
Based on the picture this is a rib similar to the bottom of the sweater (the bottom used 54 stitches). So I'm wondering if they want me to have 34 stitches to rib at the neck.
Now home with pattern:
The step P0, (inc in next st purlways) 8 times, p0 is in M on 10.5 needles. [end of the main body going back to the ribbing
The next step (both front and back) is "Change to US 3 needles and C and proceed as follows: -
1st row. P1, *k2, p2, rep from * to last 3 sts, k2, p1.
2nd row. K1, p2, *k2, p2, rep from * to last st, k1.
1st and 2nd rows set 2x2 rib.
Work 6 rows more in rib.
Cast off in rib.
[C= contrast yarn - Snuggly DK. M = main yarn - Snuggly Confetti]