ML20249C223

Informs Commission That Petitioners in Lawsuit Attack NRC Final Policy Statement on Restructuring & Economic Deregulation of Electric Utility Industry,62FR44071.Suggests That NRC Might Impose Liability for NPP Costs on Minorities

ML20249C223
Person / Time
Issue date:	06/22/1998
From:	Cordes J NRC OFFICE OF THE GENERAL COUNSEL (OGC)
To:
References
SECY-98-143, SECY-98-143-01, SECY-98-143-1, SECY-98-143-R, NUDOCS 9806260224
Download: ML20249C223 (80)

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e ADJUDICATORY ISSUE (Information)

June 22, 1998 SECY-98-143 EQI:

The Commission Etem John F. Cordes, Jr.

l Solicitor Subiect:

LITIGATION REPORT - 1998 - 2 American Public Power Association v. NRC. No. 98-1219 (D.C. Cir., filed April 21,1998)

Petitioners in this lawsuit attack the NRC's Final Policy Statement on the Restructuring and Economic Deregulation of the Electric Utility inaustry,62 Fed. Reg. 44071 (1997), insofar as it suggested that the NRC in some future circumstances might impose joint and several liability for nuclear plant costs on minority owners. We recently filed a motion to the lawsuit as " unripe."

We are awaiting the court of appeals decision.

Contact:

Peter G. Crane 415-1622 Og! Core v. Jackson, No. 3:98cv1011 (RNC) (D. Conn., filed June 1,1998)

Plaintiff, a former employee at the Millstone nuclear power reactor and now " involved in the gathering and dissemination.. of information conceming the operations of Millstone Station,"

i complains of the denial of access to NRC records. Plaintiff expresses particularinterest in j

agency records of meetings between Commissioners and a Millstone consultant. Plaintiff f

invokes 42 U.S.C.

1983 - which establishes a :ause of action for certain acts taken "under color of state law"- rather than the usual remedy for der!al of access to agency records, the Freedom of Information Act (FOIA). He simultaneously is pursuing an administrative FOIA ggh appeal within the NRC.

9 Although plaintiff has not formcIly served his complaint on the NRC or on the Department of Justice (he has 120 days to do so), we are consulting with the United States Attorney's office on the advisability of filing a prompt motion to dismiss the complaint for failure to state a valid claim for relief. We are drafting the necessary papers.

CONTACT: Catherine M. Holzle NOTE: TO BE MADE PUBLICLY AVAILABLE IN 415-1560 5 WORKING DAYS FROM THE DATE OF THIS o rf,\\)'Ol

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.2 F.A C.T.S. (For a Clean Tonawanda Sital Inc. ~v. NRC. No. 98-0354E(H) (W.D.N.Y., filed y

June 2,1998)

Plaintiff, a citizens group with members living in or near Tonawanda, New York, seeks an injunction halting further cleanup of the "FUSRAP Tonawanda Site." "FUSRAP" refers to the Department of Energy's "Formerly Utilized Sites Remedial Action Program." Pursuant to a

' Congressional directive, the Army Corps of Engineers currently is performing the FUSRAP

-' decontamination work.. Plaintiffs lawsuit names the NRC, DOE, and the Corps of Engineers as defendants.

insofar as it involves the NRC, plaintiffs complaint alleges that the NRC should exercise

. regulatory jurisdiction over the disposition of radioactive material at the Tonawanda site.

Plaintiff seeks a declaratoryjudgment that the NRC has regulatory jurisdiction. Plaintiff also seeks injunctive relief against the Corps of Engineers prohibiting further Corps of Engineers activity until the NRC exercises its jurisdiction.

We are working with Department of Justice lawyers in defending this suit.

CONTACT: Susan G. Fonner 415-1629 Intemational Committee on Microwave Weaoons v. United States, No. 08-0939 (GK) (D.D.C.,

j 1 filed on or sbout April 15,1998)

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I This lawsuit charges, in part, that several federal government agencies, including the NRC, i

have failed unlawfully to promulgate regulations implementing the so-called " Common Rule,"

f which govems some forms of research involving human subjets. Plaintiffs claim that the various agencies' failure to promulgate the Common Rule violates a 1997 Presidential memorandum issued to all aganciesc We are working with the United States Attomey's office in desfending this lawsuit. We have provided that office a letter that, among other things, explains that the Presidential directive on a

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the Common Rule covers only agency-sponsored classified research involving humans. Our letter points out that the NRC is involved in no such research.

CONTACT: Peter G. Crane 415-1622 Y

i /p hn'F. Cordes S5licitor 1/ISTRIBUT10N:

Commissioners OGC OCAA 01G OPA OCA CIO j

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Amermican Public Power Association v. NRC. No. 98-1219 (D.C. Cir, filed April 21,1998)

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l IN THE UNITED STATES COURT OF APPEALS FOR THE DISTRICT OF COLUMBIA CIRCUIT AMERICAN PUBLIC POWER ASSOCIATION, THE CITY OF ANAHEIM, CALIFORNIA, FLORIDA MUNICIPAL POWER AGENCY, PIEDMONT MUNICIPAL POWER AGENCY AND NORTH CAROLINA MUNICIPAL POWER AGENCY NO.1 Petitioners v.

Docket No.

NUCLEAR REGULATORY COMMISSION, Respondent 1

1 PETITION FOR REVIEW The American Public Power Association, the City of Anaheim, California, Florida Municipal Power Agency, Piedmont Municipal Power Agency and North Carolina Municipal Power Agency No. I hereby petition the Court for review of the following orders of the United States Nuclear Regulatory Commission:

1.

Final Policy Statement on the Restructuring and Economic Deregulation of the Electric Utility Industry,10 C.F.R. Part 50, issued August 13,1997, published at 62 Fed. Reg. 44071 (1997).

2.

Denial of" Publicly Owned Systems' Request for Reconsideration or, in the Alternative, Motion to Delay Effectiveness of a Portion of the Final Policy Statement in Order to Receive Additional Public Comment," as set forth in letter dated February 20,1998 from John C. Hoyle, Secretary, Nuclear Regulatory Commission to Gary J. Newell, counsei for Publicly Owned Systems (unpublished).

Copies of the NRC orders as to which review is sought are attached. Venue lies with this Court pursuant to 28 U.S.C. s 2343. The grounds on which reliefis sought are that the Commission's statements in these orders that it may in certain circumstances impose joint and several liability for nuclear plant costs on minority owners are arbitrary, capricious, an abuse of discretion and

2-ultra vires of the Commission's statutory authority under the Atomic Energy Act. The relief requested is that the orders be vacated.

Respectfully submitted,

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Gary J.

edell Franc E. Francis Attorneys for the American Public Power Association, the City of Anaheim, California. Florida Municipal Power Agency, Piedmont Municipal Power Agency and North Camlina Municipal Power Agency No.1 Law Offices of:

Spiegel & McDiarmid Suite 1100 1350 New York Avenue, NW Washington, DC 20005-4798 (202) 879-4000 April 21,1998 l~

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restructunng cf tha ciectnc utihty reasons for the NRC's concems. Somi intustry and the means by which NRC directly supp:rted the NRC's cvtrail int:nds to cddress those c;ncerns.

approach. particularly the five acuens Because cf th3 int: rest expressed by hsted in Secti:n ID. Ccmmentir 14. for sev ral comm:nt:rs. ths NRC cxt:nded cxample, stated that these five actions the public comment pened to February should provide sufficient focus for NRC 9,1997, act2cas. Commenter 5 beheves that the D. Summary of and Response to Es curant authonty is suEicient m cope with any safety issues raised by rate deregulanon. Commenter 31 shares The NRC received 32 pubhc the NRC's concerns but mdscated that comments on the draft pohey statement: the draft policy statement did not 14 from electnc utility bcensees or thest andress the ke' issue, namely, wnether y

representauves. 8 from State public economic deregulanon of nuclear power utihty :ommissions (PUCs) or other State agencies. 5 from pubhc interest is compatible with the protection of public health and safety.

groups. 4 from private consultants and Other comments, particularly from individuals, and 1 from a labor union.

electne ut21ity licensees and thetr The following list provides the names representataes. suggested that some and comment numbers referenced in NRC conoorns am overstated. For this notice:

NUCLEAR REGULATORY example. Commenter 4 recommended COMMIS$10N

1. Nuclear Infonnanon and Resource elimination of language in the pohey Semce-comment extension request statement that implies that deregulation to CFR Part 50 ooi is inevitable. Other commenters

2. Pubh 5emce Comnussion of Wisconsin suggested that the policy statement Final Policy Statement on the

3. Engineenns Apphed Sciences. Inc.

should mcognize that change will occur Reetructunng and Economic

4. TU Electnc Dereguistion of the Electnc Utility

5. Pubhc Semce Elecmc & Cas Company at different rates and. therefote. the NRC industry

6. Marinesota Department of Pubhc Semco should individually evaluate

r. Spiegel & McDiamud on behalf of 5 restruc2unng as it affects each npclear plant. In any case, restructunng will not AGENCY: Nuclear Regulatory

a. IPA n erpnses Inc. Ciusens Acton occur so rapidly or secretly that the NRC Cornmission.

Coahuan ofIndiana. Inc., and Pubhc will not know about it. Others stated ACTION: Final Policy Statement.

Citizen. inc.

that many services will remain

9. Wisconsin Emergency Manapment, regulated and that the PUCs will act suaansaRY:The U.S. Nuclear Regulatory Burusu of Technoiostcal Hazards responsibly. Further. there is no basis Commission (NRC) is issuing this final 10.11hnois Department of Nuclear Safety statement of policy regarding its

11. Internanonal Brotherhood of Electncal for the NRC to conclude that licensees expectations for, and intended approach Worken will be unable to provide adequate to, its power reactor licensees as the

12. Consolidated Edison Company of New financial assurance for safe operauens and decommissioning. The National electnc utility industry mcVes from an of,* or Ene' Associabontf Regulamry Mity 33, n

env2ronment of rate regulation toward

14. GPU Nuclear Commissioners (NARUC) stated that in greater competiuon. The NRC has

15. Commonwealth Edaan Company view of the experimental natun of many concems about the possible effects that

16. Vermont Department of Pubhc Sema State actions, the NRC should approach rate deregulation and disaggregation

17. Manlyn Ehe deregulation cautiously. Fmally, several result 2ng imm various restructunng

14. GE Ftackholders' Alhaace for a actions involving power reactor Sustamable Nuclear Free Future commenters asked the NRC to avoid actions that would serve as beensees could have on the protection.

19 Wom'n S eak Out for Peace and lusuce P

of pubile health and safety.

24 Mw England Power CompeaY impediments to deregulauon.

Commenters mpresenting public EPPEC1WE Daft:This policy statement

' NN*a*# l"I '586 8

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interest gro ps generally thought that becomes effective on October 20,1997.

22. New Jersev Division of the Ratepayer Po cy 8

POR PURTNER INFOnida?)Def C0fffACT; Advocate gh g, dre gb n e Rotert S. Wood. OfEmof Nuclear

23. Southern Californsa Edison Company mgated 2 demgulation.

ese Reactor Regulation. U.S. Nuclear

24. Entergy Opersuons. loc.

commenters stated that the NRC shoult, Regulam:y Comminehma.Washingus,

25. Nuclear Energy insutute take immediate action with respect to DC 20555-0001, telephone (301) 415-2a. Ananna Pubhc Semco compesy on-line maintenance ractices, extended 1255, e-mail RSWitarc. gov.

27. Massachusetts Office of the Attornsy refueling cycles and owntime dunng General gypMARY adP08matictu

28. Winston and Strewn on behalf of the refueling, and up-front funding of decommisaaorung, among other issues.

1. Background

29.

Crs ad Pet mhn

, On September 23.1996, the NRC 3a N' u ! e Cooperscw cally a u discussion of possible negatis e safety assued a draft policy statement for A

uo Public comrnent (61 FR 49711). The

31. Schhssel Technical Consulting. lac.

risks from economic deregula?.2on, such purpose of the draft policy statement

32. Neuens! Assocasuon of Regulatory Ut!hty as cutting corners and defernng capital

(*=mmeseners investments. These commenters also was to provide a discussion of the NRC's ranemens toparding tlw potential GeneralCommerres urged the NRC to expand its inspection

• • ier7 impacts on NRC power reactor and compliance resources to counter the licensees which could resset from theMost commenters viewed the adverse safety impacts that these issuance of the draft policy statement as commenters believe wi!! result from econannac deregulation and timely and appeared to understand the deregulataan.

roestas stegist r i vol. 62. No.160 / Tu:sday. August 19. 1997 / Rults and Regulations

,, m.

NRC's Response to Generot comm:nts st:ted that ths cmPhasis and focus on R*88rfmI the issue af whether the smitgency plannmg may lessen.

pit:ntelimpact o!economte h uld address the Commenter to suggest6d that the NRC's kregulation on specific safety progrwns P*t bil ty n economic shift to performance-based and nsk-and practices. As discussed m the de and the rotecuan of informed mgulauons may potentially NRC's esponse to general comments.

d h NRC threaten estabhshed safety margins.

the NRC will contmue to evaluate hiiens that economic deregulation This commenter urged the NRC to specific safety concems or to CFR 50.59 does not preclude adequate protocuon establish cunent, vigorous probabilistte review processes as part ofits safety of pubhc health and safety. However, risk assessments (FRAs) to idenufy the oversight programs. For example, on-line mamtenance and meressed fuel due to the increased uncertainty risks, which would be used in all burnup are being considered through engendered by state-by state appropnate areas of plant opwation as the NRC's safety review and inspecuen a cornerstone to maintammg cost-oversight programs. Reducuens in n7u try.the NR is co e

about eHecun safety ma$ns in a changmg manpowe and trammg cm. and du the possible impact on the protection of enytronment.

public health and safety. Thus, in the Many commentws did not view reductions in operauen and draft pohey statement, the NRC deregulation as necessanly a m <intenance (O&M) and capital expressed its general concerns about the disincentive to safe operation. TL +

additions budgets are of contmuing possible effects of deregulation-cited the incentive to operate safely aad concem to the NRC. The NRC is reshzmg that such concems can be use preventin maintenance due to the considering changes to the Senior either vitiated or exacerbated depending premium placed en unit availability. -

Management Meeting process that would include consideration of on specific deregulation approaches that Another commenter expressed the belief economic trends. However. because that near-term economte mcentives ex2st are implemented. In this respect. the NRC recognizes that deregulation will for expenditures to maintam reliable safety concerns that commenters occur at different times. In different operation. Howeve, this incentive expraesed exist. in many cases.

degrees. and in some junsdictions-decreases as a plant ages and thus is of tedependently of economic perhaps not at all. and the final policy greater concern later m a plant's life.

deregula*2on, the NRC behoves that statement more exphcitly recognizes Commenter 23 suggested that the policy these issu2s have been and are more these facts. With respect to the concems statement be modihed to support a appropnately considered in other NRC expressed by public interest groups hcensee's use of the to CFR 50.59 programs. Also independently of about the impact of certain potential review process to determine that economic deregulation, the NRC is safety practices. such as on-hne estabhshment of an Independent System sinving to rr..ie its regulatory pregram mamtenance and outage dursuon. the Operator (150) does not involve an as efficte,t and effectin as possible-NRC has addressed, and will continue unreviewed safety question.

through use of risk analysis and other to address;these issues as safety issues.

Othw commenters mdicated that techmgase--so that the resources of the This policy statement is not meant to be disincentives to safe operation should agency and oflicensees are devoted to a substitute for regulatory remedies to be dealt with by liminns reactor the most safety-significant matters.

specific safety problems.

opwating cycles to 18 months and The NRC has extsnsinly reviewed requirtng at least 250 hours0.00289 days <br />0.0694 hours <br />4.133598e-4 weeks <br />9.5125e-5 months <br /> for refueling State performance incanuve program Sufficiency of Cunent Regulatory utages. These commenters also and does not believe significant additional review is warranted at this Framework ondlncenovesfor Sofe oPgsod on line maintenance.

Operation other commenter expressed time. (See foomote 2 in the Policy Although most enmmenters indicated concern that deregulation would be a Statement below.)

that the NRC's current regulatory dismcent've to continuing cooperation N"#"C* D

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framework is adequate to protect public among nuclear generstors, such as early Commenters expressed vaned health and safery, othere disagreed.

reporung of safety and operationally opinions. Although same viewed the Commenter 21. for example, ated the significant ennts and continuation of NRC's current financial qualiBcauons the Institute of Nuclear Power regulatory framework as sufficient.

cxperience with the Millstone facihty Operations (INPO). Additionally,b others believed that addinonal measures and indicated that it is "ofincreasing psessure on the NRC to reduce costs to may be necessary. Commentar 20 concem that NRC cannot accurately han==== win increase, as will pressure indicated that the critical question for determine the extent and scope that economics plays in the reductions of to reducs use of the " watch list." This the NRCis whether. in the absence of reactor safety maryans and the deferral ccamenter cited the analogy of b independent Saancal assurances to the of safety significantissues."This resultant events at the Federal Aviation NRC from its licensees, rate regulators ccmmenter concluded that the Adminbetion (FAA) when the airlines have commined to provide licensees statement has not adequately were deregulated and urged the NRC to with sufficiendnandal resources.

safety hazards brought aboutby svoid the FAA's mistakes. This Commenter 2 stated that if recovery of commentar also sua,gested that incentive stranded costs is not allowed oris managenal malpractice in seepense to. regulation of nuclear plants may become sewrely restnaed.

economic pressures. Other commentere stated that the NRC must continue to an alternatiw to full deregulation and Premature shutdowns may occur.

casure that its own inspection and that the NRC should studyincentive further straining licensees

• financial programs used at Diablo Canyon and

. quellfications and diminishing their cversight programs identify when a Pilgnm.

licensee is failing to devote sufficient ability to f+=- =:=* ion safely. In this resources to ensuring safe opetstions.

Es Response to Comments on vein. Commenter 15 uryod that the NRC specifically as a result of deficiencies Sufficiencyof Current Regulotory aggressinly affirm that stranded capital resulting from economic pressure. When Framewort ondlacentivesfor Sgrf' costs must be recovered by utiliues.

O Mon Commenter 16 indicated that tnose necessary the NRC should see c P

additionalinspection and conhliance The NRC shares many of the concerns lonpr rete regulated should have nuclear plant licensees that are no escurces irra Congress Commenter 9 expressed by commenters about the l

sumcient buffering funds to proceed l

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Federal Register / Vel. 62. No.160 / Tuesday. August 19, 1997 / Rulzs and Regulations 44073 safely fh.ai operations t2 obligations in its deliberations on does not believe that Section 184 of the d=eneminaianeng rammaater 8 stated 6aancial quellRe=*=a=

Atomic Energy Act of 1954, as amended.

that the NRC should shut down the plants of l'emamos wata questionable I'. c., y#Ponse to Cor.iments on allows the NRC tc approve transfers by yg nonesoMuo@ cations

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Anancial abihty to sustata sais continue to use its operadons in a competitive The NSC remams concerned about current method of evaluaung a environment and should requhe them to the impacts of deregulation on its power licensee's cash Row under 10 CFR decommission their facilities. Operating reactor licensees

• Anancial 140.21 to determine a licensee's ability costs that cannot be recovered qual 15 cations.The NRC's enstit.g to pay deferred premiums under the compeutively should be borne by the regulatory framework under 10 CFR Price Anderson Act.

licensee, not the ratepayer or the 50.33(f) requires Anancalquali5 cations taxpayer, ra===nter 22 believes that reviews for those licensees that no Decommissioning Funding Assurance the NRC should institute ongotog longer meet the deAnition of " electric The con==naus appeared to be that the Anancial qualincations reviews every 2 utihty" at the operating license (01.)

NRCshould work closely with State to 5 years for all power reactor stage. P ph 4 of to CFR 50.33(0 regulators to provide for assurance of licensees, including those that still meet also provi that the NRC may seek decomsr.issioning fundmg. Commenter the NRC's deAnition of"electnc additional or more detailed information 13 =ca===adad that the pohey utility." Commenter 31 recotamends respecting an applicant's or a licensee's statementinclude a call for the that the NRC====ian whether mergers Ramarial arrangements and status of coatinued recovery of dara==issioning and joint operating agreements would funds if the th='=asan considers this costs through regulated rates and tanffs dilute or weaken units and utilities that information appropnate. The NRC will in all jurisdictions. Similarly, are performing well by spreading or evaluate addittor.at ruid-separete Commenter is suggested that the NRC diverting exisung management from the proposed rulemaking on rnanntain awareness of State attention, personnel, and other Anancial assurance requirements for decommiamsoning proceedmss, morutor l

resources over a larger number of units d="""'=onmg. to detennane whether funding adequacy ossed on the i

Other comunenters appeared quite erih=a-==*= to its Saancial estunares produced in State opumistic that additional Anancial qualiacetions requirements are proceedings, and work with the host-qualiacetions reviews would be ame==='y in anticipation that some State to ensure that adequate amounts uname====y. ca=manter is power reactor licensees will no longer are provided in decommissionmg trust

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that the NRC should avoid ces no " electric utilities." However, the funds. Another commenter stated that with other agenc as having junsdiction NRC continues to believe that its additional d=camminaionag fundmg over Anancial quallEcstions and abould pnmary tool for evaluatmg and ensunng assurance should be required on an ad not condition hcense transfers.

safe operations et its licensed facilities hoc basis and that the NRC should not Commenter 25 and others indicated that ie through itt anspection and require accelerated doeneminaioning holding companies should not be enforcement programs. In its povious funding.

subject to to CFR 50.80 license transfer expener.ae. the NRC has found that Many State and licensee commenters reviews. At most. the NRC should use thee is only an indirect relationship asked the NRC to accept non.bypassable a " negative cos.sent" approach to between Ananmal quali8 cations and charges or other mechanisrns, such as formation of holding compan*= This operational saisty, but it is continuing to dedicated revenue streams. as proof of commenter also recommended that the study this issue. Although==h=arad decomnu,aiosu'ng fundmg assurance.

NRC provide som explicitguidance on Aamaci=i -"-"a does reviews may Similarly, those licensees whose States b "no signincant hasards" critona that provide the NRC with valuable require such mechamama should be are used with license n==ad==aea additionalinsights on a hennese's considered " electric utihties" under the Commenter 23 asked that the NRC q==HRe=Hons to operate its NRC's regulations. Many commenters adopt clear crstenadorapprovalof

' ties _ safely,it is set claer that also suggemed that the NRC take a mese license transfer requests and use clear, sahanced Ananaal ---u" ~

ve role with the Congrees the unambiguous standards forlicense programs by theadves would prove to

've Branch, and others in order to tr5nefers t6 non-utility liennmana such as De a =nmeiene indicaear of general increase assurance o{ daeammianianmg those offeredin the Diet Sesaderd ability to operste a facility safely.

funds.

Review Plan (SRP) on Finanaal With respect tothe issue of Most publicinterest group QualiScations and Thea===='aning

^?a and stranded costs, comumenters advocated that the NRC Fundang Assurance (St FRessos, many states ese considerms and " fund-as you-go" deconuntasioning December 27.1998). h in securitiastion as a nonW "

by requinas full up-front 10 CFR 50.33(f) for licensees charge==ehmai== to fund the recovery dara==e=maning for unfunded should be modiSed and include of darammianianing and othat stranded halaae== nees commenters also asked standards for==== dad unplanned costa. The NRC believes thtt that any stranded cost recovery be outages such as mistasum amounts for secuntiassion has the potential to applied to external d=ca==issioning stained earmags,insuranos, and provide an acceptable method of trusts and that investors bear b greater contractual arrangements, dar===n==ianin Commenter 22 suggested that although other=g fundmg assursace.

share in funding any decommissionag

=ch==*=== that involve shortfall. Other ea===nts sought the "securttiastion" may be an non-bypassable charges sney provide alinunation ofinternal ad method of reducing camparable levels of e===ne= and d=ea==6==aming fundas and asked stran cost charles to customers.

should not be escluded front that -

~ia-be funded at a Consequently,the NRC should endorse consideration by Staae authorities.

comniete dar====peninit a third pany level that would secuntiastion as permasamble from a With to transfers of a licenes

===aatag regulatory, legal.and public pohey under to 50.a0. the NRC must Other spectSc comuments to the Paspective.

review and approve in wnting allsuch d=ea==ianianing area included (1) a Finally, two -a'a="ters urged the transfas. if such transfers meet the recommendataan that the NRC add an NRC to isctorin Pnce-Anderson appropnate NRC standards. The NRC explicit statement to the pohey l

_________________m______

44074 Federal Register / Vol 62. No.160 / Tussd.y. August 19. 1997 / Rulas and Regulations stat: ment that would inform heensees should taks a more proactiva role and alt:r. and likely pepardise. th2 busmess of the f atC's nght to essess the taming that the NRC can play a special role in arrangements thatunderpm co-and hquidity of decommissioning funds educanng rate regulators. Co nmenter 22 ownership. Several of those who (Commenter 3% (2) a reco===ad= Hon proposed that the NRC maintain a commented en tlus issue also pointed to for an inenese in der:ommassioning dialogue with all classes of ratepayers, the bankruptcy laws as one way of reportin6 requirements and assurancs perhaps through the National ensuring tnat co. owners pay their pro that funds are not diverted to non-Association of State Utility Consu:cer rata share. although Commenter 22 decommissioning uses: (3) recognition Advocates. Other suggested venues for suggested that recent NRC exponence that if charges are placed on current NRC-State regulatory interface included with bankrupt 'icensees may not hold electncaty customers while competition the Nauonal Govemors Association, the true in the future. No one directly increases, consumers will avoid nuclear National Conference of State commented on the issue of non. owner power and will. therefore. avoid I. legislatures.the Amencan Legislative operators, although 3 comments contnbuting to decommissioning Frehange. and similar groups addressed this issue penpherally, funding: and (4) recognition that (Commenter 25). Commenter 15 s esponse to Commnts on Mnt decommissioning is not a stranded cost, suggested that the NRC and NARUC because stranded costs are kncwn and convene a iciut conference on stranded 3P measurable coste that have already been capital cost recovery. As previously The NRC recognizes that co-owners incurred, wheroes dacamminaioning mentioned. severs! commenters and co.licansees generally divide cotts costs are not fully anown and have yet indicated that the NRC should act to and output from their facihties by usmg to be incurred.

educate Congress and seek legislation in a contractually-denned. pro rata share areas relevant to plant safety and standard.The NRC has implicitly NRC's Response to Comments on restructuring, for example. e natio.2.1 accepted this practice in the past and Decomnusssonmg Funoing Assurance excise tax to fund decommissioning.

behoves thet it should continue to be Many of these comments percliel Finally. Commenter 22 suggested that the operative precuce. but reserves the comments received on the Advanca the NRC review the States' plans for cost nght. in highly umaual situations Notice of Proposed Rulemaking (ANPR) mcovery to ensure that, once recovered where adequate protection of public (6t FR 15427. April 8,1996) that sought through rates, these reveraues are health and safety would be comment on restructuring issues as they employed for the purpose for which compromised if such action were not may relate to dara==ta6 toning funding they were collected taken. to consider imposing joint and assuance. The NRC is developing a severalliabihty on co owners of more proposed rule that consic'ers most of E3 A'sPonse to Commnts on than de mirumis shares when one or these comments. With respect to the Regulotwylaterface more co-owners have defaulted. The specific comment that the policy The NRC believes that the policy NRC is addressing the issue of non-statement should indicate that NRC statement adequately covered the NRC's owner operstors separately.

retains the nght to assess the timing and intent to work closely with rate Antstrust liquidity of decommt'ssioning funds the regulators and others as omregulation NRC agrees and willadd suca a proceeds. The NRC will consider Most cor: met.ters viewed NRC statement. Because of the long history of expandmg contacts to include the other antitrust reviews e edundant to those effective rate regulatory oversight and groups identified. Although the NRC perfonned by other agencies, especially recovery of safety.related expenses will testify before Congress when asked in view of FERC Order 888. and ram==aadad hat the NRC act to through ratas.in the 1988 to speak on its views on deregulation as t

decommissioning rule (53 FR 240t8.

related to protocung public health and ehmanate this redundancv. Commer.ter June 27.1948), the NRC deferred to the salsty the NRC is evaluating whether it 22 suggested that the NRC develop a PUCs and the Federal Energy Regulatory should make aparine -==ada'iana memorendum of understanding with Commission (FERC) on the tuning and on =Maa'== to handle FERC and the Securities and *d-a==

hquidity of daea==ianian'ag trust fund decoeurnamaning casts and e "l t'a==*==ian (SEC) that would allow the deposits. However, the NRC nas the costs. '!be NRC recognisms that Federa NRC to rely on the judgments of these authonty to aseems the timing and legislation might be of beneStin agences about market wer that do not liquidity of such deposits byits resolving thans issues. However, the raise issues unaque to NRC's lic==

. and intends to suermas this NRC also recognisms the vital role that

===d=== Another commenter.

authonty with those hconsees who lose States have played and will continue to

=aadad working with the rete regulatory oversidnt. Sindlarly.10 play in resolving these issues and is Deparunent of Justica to develop a tiet CFR 50.82 sparinam a adisdale der fully prepared to work with the States of guidelines and criteria to evaluate daca==ianianing trust head through either State or federally requests for ownership changes.

withdrawals and the Ewillthus sponsorad initiatives.

NRC's Aesponse to Comments on

["

d"" 8 *

)Wat Ownership Antitrust Virtually all who ca===ated in this The NRC is statutorily required under Regulatorylaterface area beheve that ths NRC should not the Atomic Energy Act of 1954. as Most commentero support NRC's impose joint and several liability on co-a==adad (AEA). in rannar' ion with an working closely with State and Fedaral owners of nuclear plants. Rather ends application for a license to const-uct or rate regulators, although sono public coownee shouldbelunitedtoits pro operate a

~ under section 103.to interest troups stated that such an eBort reta share of operating and evaluate an app *

• or a tiennsee's would onor scant protection to the d====nesianing empenses. '!he NRC activities under the NRC license to Public (ra===ter ly). Many thought shouin not look to one owner to " ball determune that these activities do not that the focus of this cooperation abould out" another owner. Comunenser 28 create or maatam a situation be on the assurance of of sugpaesed that any eBart to alter the la=====at with the anutrust laws of d===-"'M costs.

current legal and Saancial relationship the United States. However, the NRC conumenters believe that the NRC among co-owners would retroactively has begun to work with FERC. SEC. and

p the Deparanent ef fustice is develop Dtssegregatton may i::volve utility require its oth:r licensees (with thz methods by which the NRC can restr*5 mergers,and corporen added excepta:n af State and Federal mirumise duplication cf effort ca sptatffs that lead ts changes in owners g:vernm:nt licensees of csrtain anutrust issues, while carrying out its er eperators of licensed power reactors facilities) to provida funding assuranco statutory responsibilities. The NRC will and may cause some licensees, for the feilesumated cost of also consider seeking

'slation to including owners, to cease being an decommissioning. either through full eliminate its review to extent that its "electnb utility" as defined in 10 CFR up. front funding or by some allowable review duplicates the efforts of other 50.2.' Such changes may affect the guarantee or surety mechantsm.

federal agencies.

licensing basis under which the NRC A. discussion of b NRC review OtherIssues originally found a licensee to be process is contamed in two draft f nancially qualified, either as an Standard Review Plans ISRPs) that the Several commenters mad *

"electne utility" or otherwise. to NRC issued for comment: NUREG-1577, observations not directly addressed in construct. operate, or own its power

" Standard Review Plan on Power the draft policy statement. Comt' enter 5 plant. as well as to accumulate adequate Reactor Licensee Financial stated that nuclear plant operators in the funds to ensure decomnussiorting at the Qualifications and Decommissioning Northoest Umted States are subsidizing and of reactor life. (See discussion Funding Assurance"(January 1997);

dirtier coal genere:lon from Western

'mlow.)

and NUREG-1574. " Standard Review U.S. generators. Accordingly, the NRC Rate regulators have typically allowed Plan on Anutrust"(January 1997). In should articulate its views on the need an electne utility to recover prudently addition. the NRC issued an for nuclear power and its value for fuel incurred costs of generating.

Adnunis'rstive Letter on June 21.1996.

diversity and environmental protection, transmitung. and distnbuting electric that informed power reactor licensees of Commenter 16 recommended that the services. Consequently, in 1984. the their ongoing responsibility to mform NRC the Department of Energy to NRC eliminated financial qualifications and obtain advance approval from the proc with intenm spent fuel storage reviews at the OL stage for those NRC for any changes that would to reduce uncertainty and costs facang licensees that met the definition of consutste a transfer of the license, nuclear plant operators.

"electne unlity" in 10 CFR 50.2 (49 FR directly or indirectly, through transfer of NRC's AesPCnse to Comments on Other 35747. September 12.1984). Tim NRC control of the NRC license to any person y,sws based this decision on the assumpuan pursuant to 10 CFR 50.80. This that "the rete process assures that funds admmistrative letter also reminded The NRC does not have a role in needed for safe operation will be made addressees of their responsibility to advocanng the positions stated in these svaslable to regulated electric utilities" ensure that information regarding a comments.

(49 FR 35747, at 35750). However. the licensee's financial qualifications and Policy Statement NRC recognised that financial decommissioning funding assurance qualifications reviews for OL applicants that may have a significant implication

1. Sosis 4

might be er propnate in particular cases for public health and safety is promptly This policy statement recognians the L- -dis.h. for example. "the local public reported to the NRC.

changes that are occurnng in the electnc utility commation will not allow the utility industry and the importance total cost of opersting the facility to be IZT. Specific Policies j

these changes may have for the NRC and recovered throgh rates"(49 FR 35747 The NRC is concerned about the l

sts licensees. The NRC's pnncipal et 357511. The Conurdasion also has Potential impact of utility restructunng mission is to regulate the nation's expressed concern abou: various State on public health and safety. The NRC civilian use of byproduct. sourcs, and proposals to implement economic has not found a consistent relanonship special nuclear matenals to ensure performance incentive programs.:

between a licensee's financial health adequate protection of pulitic health and In its 1988 d-nii==oning rule, the and generalindicators of safety such as safety, to promote the common defense NRC again d!"4ad-u between the NRC's Systematic Assessment of l

and secunty, and to protect the electric utilities and other licensees by Licensee Performance. The NRC has environment. As part of carrying out allowins "electnc utilities" to traditionally relied on its inspection this mission, the NRC must monitor accumulate funds for decommissioning process to indicate when safety 6

licensee activities and any changes in over the romaaning terms of their i.L w.;m has begun to show adverse licensee activities. as well as external oPereting li-a==. NRC regulations trenda. On the basis ofinspection factors that may affect the ability of Program results, the NRC can take individual licensetas to mainly operate

'ssanee so.: deamm elmanc mulay as.my appropriate action, including, and decommissiim licensed power

• • "'? **' 8'""" " dd"**** *h'"$'"y and ultimately, plant shutdown. ta protect l

production facilities.

• • " ""$"" ""di eush r ". - lW"*"brPublic baalth and safety. However. if a dmesur I

IT. 3ackground eme"erey. '1ar.F *n*a'su's'o"eu"es.* Anni eas plant's licensee (s) may no longer have lP ant as permanently shut down. thu

• "F """

• 8 4"'ry The electric utilityindustryis sammenes and disnhuus= subsidannes. puhaic access to adequate revenues or other i

entering a pened of sceneanic

'887 8h'nas. muner i-rusei ensanc souaces of funds for decommissioning I'

deregulation and restrucnanag that is 7,,,,".j'jd T *,8,',',",,,,,

the facility. If rate deregulauon and intended to lead to increased organizational divesuture occur inci e.e imin m. --.., et..i sic niny. -

l competition in the industry. Increemag a ses re Lane sasury impens of samassme

" concurrently with the shutdown of a competition may force integrated power Performanas lassen.es: Maal Pousy smaammans. tas nuclear plant either by NRC action or by j

systems to separate (or "disaggregste")

ma8**M**N8" 8 Hr====='s economic decision. that their systems into funnianal areas.

,, uns mandares and pnsiasm. n. emc uneminemes esi h.eensee may not be able to provide Thus.some hemosses may divest sinous assume e many or man. praesums as a mamme i

*2uste assurance of decommissiontag 1

.ieciricai gen.retion amem fran er -.=

.a-o -

n.

fu s.Thus, the NRC believa that its transmission and distnbution assets by "7 ", ;,,,,,,^j* "",,*,",*,,8",h" concerns about deregulation and I

formmg separate subsidianos or even

,,,,,n,,

,,,,, ems wusmmer m., he restructunns lie in the areas of i

separate companaes for generstion.

repanned by full enarnei r-men.

adequacy of decommissioning funds i

)

l l

)

44078 Federal Regular / Vol. 62. No.160 / Tutsday. August 19. 1997 / Rules and Regulations and the pananaal c5 set that economic In consideration cf these concerns.

B. NRC Responsibilitms Vis-a Vis Stata deregulation may havs on sperou:nal tha NRC will evtlusta dcfogulaurn and and Federal Economic Regulators sagety.

restructunng activitses as they evolve.

N NRC has reco-aW the pnmary As the esectnc utility industry moves Recogninns that the electric utility role that State and Federal economic om an envuonment of subasantial industryis likely to undergo greet regulators have served.and in many economic regulation to one of increased change. as restructunng progresses. the cases will continue to serve. in settmg competition.the NRC is concerned NRC will conunue to evaluate the need rates that include appropnate levels of about the pace of metructunng and rate for regulatory or policy changes to meet funding for safe operation and deregulation. Approval of organizational the effects of deregulanon.The NRC decommissionmg. For example.the and rate deregulation changes may will take all appropnate actions to carry preamble to the 1988 decommissionmg occur rapidly. The pace and degree of out its mission to protect the health and rule contained the following statement:

such changes could affect the factual safety of the public and, to the eAtent of "The rule, and h NRC's underpinrungs of the NRC's previous its statutory mandate, to ensure implementation of it. does not deal with conclusions that power reactor hema====

c==:=:== y with Federal antitrust laws. Enancial ra* dan issues such as rate have access to adequate funds for opersuons and can reliably accumulate

& NRCintends to implement of fund collection, procedures for fund bed collection, cost to ratepayers. taxauon adequate funds for decomminaionmg (Ci"

' em hs effects. equstability between early and PoHey over the operating lives of thou-facibues. For example, rate deregulation Peer mector lacensus remain late retepeyers. eccounung procedures.

could create situations in which a hamaHally quahfied to ensum ratepayw versus stockholder licensee that previously met the NRC's conna aea safe operations and canaidaretions, responsiveness to change and other sunilar concems de$ ninon of an "electnc utiuty" under decommissiontag. In surnmary, the NRC to CFR 50.2 may, at some point. no Will-

... These matters ass outside NRC's junsdiction and are the responsibihty of longer qualify for such status. At that e Conunue to conduct its samanal the State PUCs and (the Federal Energy point. the NRC will require licensees to qualincations, decommissioning Regulatory Comminaion) FERC" (53 FR submit proof pursuant to 10 CFR funding and antiinast reviews as 24018. June 27.1988. at 240381 50.33(0(4) that they remain Anancially described in the SRPs developed La Notwithstanding the pnmary role of quah5ed and will require them to meet concen with.this policy statement:

economic lators in rete matters.the the mm sinagent darammissioning

. Identify all owners,intmet as wsil NRChas au mty.undw the AEA to funding assurance requirernents of to CFR 50.75 that are apphcable to non-as direct. of nuclear power plants:

take actions that may afr t a heensee's ac Mamanal situation when these acnons electne utilities.

• Estabush and maintain wwking are warranted to protect public health Although new and unique -

mlationahsps with State and Federal row and safety. To date, the NRC has found restructunng proposals will necessarily regulatore: and no signi$ cant instances in wh2ch State involve case-by case renews by the e Reevaluate its regulations for their or Federal rate regulation has led to NRC. the NRC staff will advise the adequacy to address changes resulung - disallowance of funds for safety related Commission of such proposals so that from rete deregulation.

operational and decommissierung the Commission will have the option of expenses. Some rate regulators may exerestag direct oversight of such A. Adequacy of Current Regulatory have chosen to reduce allowable proEt revmws to maintam consistent NRC Fremwork margins through rate disallowances, or policy toward new entities. As patterns

& NRCbehwes emis segulsory h-- have for othat reasons of restructunng begin to emergs, the frameworkis generall fE t

this encounared Baaamd dEcialty.

,,,,,,. g,M,y su man et NRC will canader stonderdimag its use, to addren se and in order for the NRC to make its safety framswork furtherto streamhns, where igg;g,g,3,,

views known and to encourage rete y

possible. Its case by case sonow process. N NRC has considased. and a resuh of electnc unhty '- --+ '-

to continue their practice of will conunue to consider mergers and Absent change m the NRUo mgulmmy

"'"8 "P'"

the outnght sales of facilities or

• O' #8 '*"" P"*" **U nuclear plant safety as electnc utihues ponaons of facilities, to reqmre NRC

. lohm se cuannt frum=wL The NRC face deregulation. the NRC has taken a number of actions to increase noti 5 cation and pnor approvalin behnes est its Annanal quahScedcas cooperstic.n with State and Federal rete accordance with to GR 50.80 in order seguirements am sufEciently bread as to and anncaal regulators to promote to ensus timet the tranaderse er hcanese Provide en adeques framwak to is appropnately quahBed. Fer' exam adequeely snm nw or unique dialopus and minimine the possibility of

,,,,,,,----w or other actions that in certain merger situations,the

=6a=Ha== that am not uplicitly comed would have an adverse eHect on safety.

determines whether the serviving in to GR 50.33(0 and appendix C to The NRC intends to continue to work organiastion wiH remain an " electric Past 80. Ier Rassical quali$ cations, and and censult with the State PUCs.

utility" as doBned in 10 CFR 50.2. !f a in to CFR 50.75 for darammi==ianin$

individually or 6.ough NARUC. and hcense appucent or a hconsee falleto funding assurance Howner. in order to with FERC and other Tederal agencies to meet this deRaition, the NRC wiu reek remove any ambiguities inits coordinas activities atd uchangs l

additional assurance of Saancial regulations and to addrums those.

infonnation. However. sue Commission guallacetions to operate and situations that uney not be adequatelF also reserves the amhility to take n

' ' the facihty pursuant to covered under current regulations. the approprism steps in order to assure a 10 CFR 50.13(0 and 50.75 and as NRCis g rulemaking to novase hconsee's adequate accumulation of discutandin more detailinits SRP on its "

+%== fundang assusanos

?-

~== funds.

i these subsects.The NRC has also roquasements as described in 4ection edvised uceneses that the formation of IILE.The NRC is evaluaang whether C. h !)!nemt of ResPoasibili7 holding coan requires sati8catio.

'nadine=Han. to its Anancial Many of the NRC's reactor and appro pursuant to 10 CFR 50.00.

quahEcstions regulations are warrested.

h-- own their p ts jointly with l

t

Fedeeud Regneter / Vcl. 62. No. too / Tuesday. August 19. 1997 / Rules and Regulations 44077 I

mher, unrelesed ort"n==a=== Although capability for sale ap==*>a= and F. Aantrust Reviews some co-owners may only be authonsed dea ='=Woning that could anse frors

& NRC is statutorily required uncier to have an ownership intemet in the rate demgulauon anc, mstnictunng.

the AEA. in connection with an nuclear facility and its nuclear material.

Secuan 184 of the AEA and to CF1t applicateen for a license to construct or and not to oPerste it,the NRC mws all 50.80 provide that no license shall be operate a facihty under secuan 103, to co-owners as co-liconeses who are transferred. directly or indirectly, evaluate an applicant's or a licensee's responsible for comp)ying with the through transfer of control of the acuvities under the NRC hcense to twms of their licenses. See Public license, unless the Commission detennine whether these activtues servsce Company ofindiana,Inc.

consents in wnting. N NRC will create or maintam a situauon (Marble Hill Nuclear Generating Station. contmue to review transfers to inconsistent with the antitrust laws of Units 1 and 2). A1.AB-459. 7 NRC 179.

determine their potential impact on the the United States. However.the NRC 200-201(1978). The NRC is concerned licensee's abihty both to maintain will explore with FERC. SEC. and the about the effects on the availability of adequate technical qualifications and Department of Justice methods by which operating and decommissioning fetds.

orgnatantional control and authenty the NRC can rmmmine duplication of and about the division of responsibility over the facility and to provide adequate effon on antitrust issues, while for opersung and decommissioning funds for safe operation and maintaining its statutory funds, when co-owners file for decommissiorung. Such consent is responsibihties. The NRC will consider bankruptcy or otherwise encounter clearly required when a corporate entity seeking legislation eliminatmg its financial disculty.8 h NRC seeks to transfer a heense it holds to a remw mandate to the extent that NRC recogruzes that co-owners and co-different corporate entity. See long remws are duplicated by other hcensees geners!!y divide costs and Island I.ighong Co. (Shoreham Nuclear agencies.

output from their faciliues using a Power Stanon. Unit 1) CLI-92-4. 35 h NRC saticipates that compeutive contractually defined. pro reta share NRC 69 (19921. The NRC staff has reviews over the next 5 to 10 years will standard. The NRC has implicitly advised licensees that agency consent anse pnmanly from changes in control accepted this practice in the past and must be sought and obtamed under to of licensed facilities. The regulatory l

l believes that it should continue to be CFR 50.40 for the formanon of a new review addressms transfer of control of l

the opereuve practice. but reserves the holding company over an existing liennaan under to CFR 50.80 will be nght. in highly unusual situeuons licensee. Other types of transactions, used to determine whether new owners where adequate protocuon of public including where non-licensee or operetors will be subject to an NRC health and safety would be organizations are proposed to have some review with respect to am.itrust matters.

compromised if such action were not degree of involvement in the taken, to consider imposing joint and management or operation of the plant.

Small Beemens Regulatory Enforcement wmelliability on co owners of more have been considered by the staff an a Fairness Act than de intrunus shares when one or case.by-case basis to determine whether in accordance with the Small 1

more co-owners have defaulted.

10 CFR 50.80 consent is required. The Business Regulatory Enforcen.a.t Act of D. Financial Qualifications Reviews NRC is evaluating what types of 1996. the NRC has determtned that this transfers or restructunngs should be action is not a "maior rule, and has

& NRC believes that the existing subject to 10 CFR 50.80 review. 'Be verified this determination with the latory framework contained in 10 NRC staff willinform the Commission OEco ofInformation and Regulatory 50.33(0 and in the guidance in to of unique or unusuallicensee Affairs. Osce of Management and CFR Part 50. Appendix C. is generally restructunng actions.

Budget.

suscient at this time to provide rmonable assurance of the Aa-a '.

E. nara====ioning Funding Assurance Electresuc Access i

qualifications of both eld 6trt(htility and Re***

N NRC electronic Bulleun Board non electric utility applicants and The NRC believes that the existing System (BBS) on FedWorld may be licensees under the various ownership decommissioning funding amouranco accessed by using a personal computer, anangements of which the~staffis provisions in 10 GR 50.75 generally a modem, and one of the commonly currently aware. t le=a-that remain provide an adequate regulatory basis for available comununications software

" electric utilities" will not be subject to existing and possible new licensees to packassa, or directly by way of Internet.

i NRC Anaar:nal qualih review, provide reesenable assurance of Bachgepund documents on the final other than to detenmine that such daca==nesioning funds. However, to policy statement are also available. as i

licensees, in la.:1. remain " electric examine this and other issues related to practical. for downloading and viewing utilities." However, the NRCis dara =iasioning funding assurance in on the bulletin board.

I evalua the need todeceleP anticipauon of rete

.the

!!using a personal computer and additio requirememes to eneum NRC published an (81 FR 15427 modem, the NRC subsystem on against potential dilutten of the April S.1996).N NRCis considenne FedWorld can be accessed directly by a ---- " rulemaking developed in the toll-free number (800) 303-

'N 'etc he had meanne wah th'"

M to the comments received on 9871.

unication software NONN",,",.8'",i,,,'""g$he the ANFR. In addition, the NRC wishes' parameters should be set as follows:

hiedmean u esins UA manhempisy cae. to emphastas that it retaans the right to Panty to none, data bits to 8. and stop Pee Some of Ms= Hesyshus assess the tamang of daramminataning bits to 1 (N.S.11. Using ANSI or VT-100 l

amen. e me=== and somem erime s" trust fund deposits and withdrewels and termunal emulatian, the NRC subsystem

. ten,e.,semeYcen'."gaC'* 7 the liquidity of d=ca==i=ianing funds can then be accessed selecung the

,e c campmene sceousi. e e=== etits aber ased for those Lieaa-that no longer have

" Rules Manu" option a the "NRC Plant Asch PSOE and EFEC emscaued ther pse reta regulatory oversight and insofar as Main Mons." Many NRC subsystems 7,,,,*,"d i,,,,

such timing would potentially impact and datakaana also have a " Help /

m eu s uy

.d men

,,.ca the protocuan of public health and Information Center

• opuon that is emnese sa heatempery.

safety.

tailored to the particular subsystem.

44078 Federal Register / Vcl. 62. No.160 / Tuisday. August 19. 1997 / Rul:s cnd Rzculattens The NRC subsystem on FedWorld can (

also be accessee by a direct-dial telephone number for the main I

FedWorld BBS. (703) 321-3339. or by using Telnet via Intemet: fedworld. gov.

If usmg (703) 321-3339 to contact

[

FedWorld the NRC subsystem will be accessed from the main FedWorld menu I

(

l by selecting the " Regulatory.

Government Administration and State Systems." then selecting " Regulatory Information Mail." At that point, a menu will be displayed that has an option "U.S. Nuclear Regulatory t

Commission." which will take you to a

the NRC en line main menu. The NRC i

On line area also can be accessed directly by typing "/go arc" at a i

FedWorld command line. If you access NRCfrom FedWorld's main mrna. you 1

may return to FedWorld by selecting the

" Return to FedWorld" opuon from the i

NRC on line main menu. However,if you access NRC at FedWorld by using i

NRC's toil free number, you will have full access to all NRC systems, but you will not have access to the main FedWorld system.

If you contact FedWorld using Telnet.

you will see the NRC ares and menus, including the Rules menu. Although you will be able to download docunents and leave messages. you will not % able to wnte comments or upload fibs (comments). If you contact FedWorld using FTP, all files can be accessed and dowrdoaded but uploads are not allowed; all you will see is a list of files without descriptions (normal Gopher look). An index Ale listing all files within a subdirectory with desenptions, is available. There is a 15 minute time limit for F"l? access.

Although FedWorld can also be accessed through the World Wide Web.

like FTP, that mode only provides access for downloading Ales and does not display the NRC Rules menu.

{

For more information on NRC bulletin boards call Mr. Arthur Deela. Systema Integration and Developesent Branch.

NRC. Washington. DC 20555-0001, telephone (301) 415-5780: e mail j

AXD3enre. gov.

Dated at Rockville. Maryland, thas t3th day of August.1997.

For the Nuclear Regulatory Commassaon.

Jehe C. Boyle.

I Secreaaryof the Commsssion.

(FR Doc. 97-2t479 Filed 6-t6-97: 8:45 am) e asume enes tune.es.g e

/

\\,

e f

UNrTED STATE 3

{

NUCLEAR RECULATORY COMMl!SION useaucrow.o.c. sonss.eeos k

February 20, 1998 SE cht"FAMV Gary J. Newell, Esq.

Spiegel & McDiarmid 1350 New York Avenue, N. W.

l Washington, D. C. 20005 4798 RE:

FINAL POLICY STATEMENT ON THE RESTRUCTURING AND EC DEREGULATION OF THE ELECTRIC UTILITY INDUSTRY

Dear Mr. Newell:

\\

By letter dated October 14,1997, you filed " Publicly Owned Systems' Request for Reconsideration or, in the Altemative, Motion to Delay Effectiveness of a Portion of Policy Statement in Order to Receive Additional Public Comment", on behal and cooperatively owned electric utility systems (" Publicly Owned Systems").

Owned Systerns requested that the Commission reconsider that portion of Statement which addressed joint and several liability of co-owners / licensees For the following reasons, the Commission declines to reconsider or delay the eff that portion of the Final Policy Statement.

)

{

The Final Policy Statement did not create a binding rule or regulation. It in n private contractual arrangements. Moreover, it expressed no change in prior NRC p I

policy. It set forth a view that the NRC may, under unusual, specific circumstances, c imposing joint and several responsibility on co-owners / licensees of nuclear plant of policy creates no binding regulaten or rule for licensees. See Limerick Ecology hRC, 869 F. 2d 719, 736 (3rd Cir.1989). Thus, no rights or obligations of licensees are affected by the policy statement.

l l

In addition, the NRC has not stated that it will abrogate contractual relations cr responsibilities or interfere with a pro-rata division of responsibility. In fact, the NRC acknowledged that prtwata division of responsibility is the norm, and should remain the operative standard. Rather, the NRC expressed the view that in extraordinary circ where public health and safety is adversely affected, it would conssder imposing jo several responsibility in order to address the health and safety issue. This does no departure from previous Commission practice. See, e.g., Public Service Compa Hampshire (Seabrook Staten, Units 1 and 2), CLl-88-10, 28 NRC 573 (1988).

'j The Final Policy Statement is fully consistent with the " Proposed Rule on Finan Requirements for Decommissiorung Nuclear Power Plants," (62 Fed. Reg. 4 10,1997)), wherein the NRC noted that the broad imposition of joint and sev decommissioning costs may not be necessary because the Commission gene the leywl of financial assurance for decommissioning to be adequate. Thus the TNI Y

G. Newell !

need to impose an additonal regulatory obligation ofjoint liability on CCH:WnenB or Co-licensees." 62 Fed. Reg. 47588 at 47594. If the Publicly Owned Systems, neve belove there is some inconsistency between the proposed rule and the Final Pol they may offer such comnient with respect to the proposed rule.

The Commission did not intend to create additional uncertainty regarding l recognizing the present climate of electric utility restructuring. Rather, the Commiss to clearty state possible courses of action shou ld circumstances dictate. The Statement does not impose any regulatory obligation on licensees. As stated abo that under certain unusual circumstances, the NRC ma habdity The Commission sees no need to delay the eMeetiveness of that portion of th pending additional comment. The comment penod for the draft policy statement, wh open from September 23,1996 until February 9,1997, provided ample time for co insight on this issue not previously brought to the attention For the foregoing reasons, the Commission declines to reconsider or delay im the Final Policy Statement.

Sincerely, John C. HoyW, Secretary

/

i i

e CERTIFICATE OF SERVICE :

Pursuant to Rule 15(c) of the Federal Rules of Appellate Procedure and Circuit Rule 15(a), I hereby certify that I have on this 21st day of April,1998, caused the foregoing Petition for Review to be served upon the Secretary and the General Counsel of the U.S. Nuclear Regulatory Cornmission by first class mail, postage prepaid, at the addresses shown below.

John C. Hoyle, Secretary Karen D. Cyr, General Counsel Nuclear Regulatory Commission Nuclear Regulatory Commission One White Flint North, Room 16H1 One White Flint North, Room 17H23 11555 Rockville Pike 11555 Rockville Pike Rockville,MD 20852 Rockville,MD 20852 In addition, service has been made on the United States by first class mail, postage prepaid, at the address shown below:

U.S. Department ofJustice Main Justice Building 950 Pennsylvania Ave., N.W.

Washington, D.C. 20530 J

,/

/

/W/

/ /7 Gary J. Newell Law Offices of:

Spiegel & McDiarmid 1350 New York Avenue, NW Suite 1100 Washington, DC 20005-4798

-(202) 879-4000 l

t k

r' (Crd< c b

UNITED STATES COURT OF APPEALS FOR THE DISTRJCT OF COLUMBIA CIRCUIT I'

AMERICAN PUBLIC POWER ASSOCIATION,

)

ct al.,

)

Petitioners,

)

)

v.

)

No. 98-1219 l

)

U.S. NUCLEAR REGULATORY COMMISSION

)

and THE UNITED STATES OF AMERICA,

)

)

Respondents.

)

)

RESPONDENTS' MOTION TO DISMISS The U.S. Nuclear Regulatory Commission (NRC) and the United States of America, respondents in this action, respectfully request the Court to dismiss the petition for review on grounds oflack of ripeness.

l BACKGROUND l

)

The petitioners in this case seek review of what they characterize as two " orders" of the l

U.S. Nuclear Regulatory Commission (NRC). The first is the NRC's " Final Policy Statement on the Restructuring and Economic Deregulation of the Electric Utility Industry," 62 Fed. Reg. 44071 (August 19,1997.) [ Attachment 1.] The second is the NRC's denial, memorialized in a February 20,1998 letter from the NRC Secretary, of a request that the Commission reconsider (or in the alternative, delay the effectiveness of) that Policy Statement. IAttachment 2.] The petition for review asserts that "the grounds on which reliefis sought are that the Commission's statements in these orders that it may in certain circumstances impose joint and several liability for nuclear plant costs on minority owners are arbitrary, capricious, an abuse of discretion and

_L___---

.2 ultra vires of the Commission's statutory authority under the Atomic Energy Act."

The U.S. Nuclear Regulatory Conunission and the United States, respondents in this case, respectfully 9k this Court to dismiss the petition, as the controversy is not yet ripe forjudicial

- review.

STATEMENT OF THE CASE On September 23,1996, the U.S. Nuclear Regulatory Commission issued for public

. comment a draft policy statement that addressed the implications for the NRC's regulatory program ofimportant legal and economic changes taking place in the electric utility industof.

61 Federal Register 49711 (September 23,1996). The notice explained that as the electric utility industry, long subject to economic regulation, made the transition to an era of economic

. deregulation, the NRC needed to consider the possible adverse effects of these changes on the protection of public health and safety. The NRC observed that one of the longstanding bases of its regulatory program was the assumption that power reactor licensees could be relied on to accumulate sufficient funds to ensure b $ the safe operation of each licensed nuclear plant and its ultimate decommissioning. The recent shift toward deregulation and restructuring had raised concerns, the NRC said, that this assumption might no longer be valid. Accordingly, the NRC thought it appropriate to set forth its " expectations for, and intended approach to, its power reactor licensees" in this period of change.

< The draft notice included a brief paragraph entitled "Co-owner Division of L

Responsibility.". 61 Fed. Reg. at 49713. In it, the NRC observed that "many of the NRC's power reactor licensees own their plants jointly with other, non related organizations," and stated

-_____-__-_-__-_______-__O

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c I

3 I

that the NRC " views all co-owners as co-licensees who are responsible for complying with the

(

tenns of their licenses." The notice expressed the NRC's concern about the availability of l

l operating and decommissioning funds, and the division of responsibility for such funds, in the event that one or more co-owners" file for bankruptcy or otherwise encounter financial difficulty.

j The NRC said that it was " evaluating courses of action to ensure that operating and decommissioning costs are paid by owners."

After receiving public comment, the NRC issued a final Policy Statement on August 13, 1997. 62 Fed. Reg. 44071. The final notice, like the proposed notice, included a paragraph on "Co-owner Division of Responsibility." This paragraph, in the final notice, included two sentences that had not appeared in the earlier notice:

The NRL recognizes that co-owners and co-licensees generally divide costs and output from their facilities using a contractually defined, pro rata share standard. The NRC has implicitly accepted this practice in the past and believes that it should continue to be the operative practice, but reserves the right, in highly unusual situations where adequate protection of public health and safety would be compromised if such action were not taken, to consider imposingjoint and several liability on co-owners of more than de minimis shares when one or more co-owners have defaulted.

62 Fed. Reg. at 44077.

On October 14,1997, counsel for petitioners in this case wrote to the NRC on behalfof eight municipal and cooperatively owned electrical utility systems, asking the NRC either to reconsider the ponion of the Policy Statement that addressed the joint ahd several liability of co-owners or to delay its effectiveness pending the receipt of additional public comment. The Commission declined this request, by letter of Febmary 20,1998, from the Commission's Secretary, John C. Hoyle.

4 Mr. Hoyle's letter explained that the Policy Statement had not created any binding rule or regulation, altered any private contractual arrangements, or made any change in existing NRC prac: ice or policy. Rather, the letter said, the Policy Statement " set forth a view that the NRC mav. under unusual. soecific circumstances. consider imposing joint and several liability of co-owners / licensees of nuclear plants." [ Emphasis added.] Moreover, Mr. Hoyle's letter continued, the NRC had " acknowledged that pro-rata division of responsibility is the norm, and should remain the operative standard." Only in " extraordinary circumstances, where public health and safety is adversely affected," would NRC " consider" imposing joint and several liability, the letter said.

This petition for review followed.

M t9 MENT Petitioners' challenge to the NRC's Policy Statement falls far short of meeting the ripeness standards established by the Supreme Coun and this Court. In the leading case of Abbott Laboratories v. Gardner, 387 U.S.136 (1967), the Supreme Court described the ripeness requirement as designed "to prevent the courts, through avoidance of premature adjudication, from entangling themselves in abstract disagreements over administrative policies, and also to protect the agencies from judicial interference until an administrative decision has been formalized and its effects felt in a concrete way by the challenging parties." 387 U.S.136,148-49.

In the more than three decades since Abbott Laboratories, the law of ripeness has become well settled. - As recently as last month, the Supreme Court, in a unanimous decision,2eiterated n

the principles of Abbott Laboratories, holding unripe a challenge to a federal " Land and -

l-

5 l

Resource Management Plan" for a national forest in Ohio. Ohio Forestry Assn. v. Sierra Club, 118 S.Ct.1665,66 U.S.L.W. 4376 (May 18,1998).

In the Ohio Forestry case, the Management Plan at issue identified allowable sale quantities for timber harvesting in the forest, but did not itself authorize the cutting of any trees.

That would require a separate, site-specific action, supported by appropriate documentation.

The Coun observed that although there was " considerable legal distance between the adoption of the Plan and the moment when a tree is cute the Plan's promulgation nonetheless makes logging more likely in that it is a logging precondition; in its absence logging could not

]

take place." Slip op. at 3. The question, therefore, was whether an emironmental group could bring a challenge to the overall Plan, or was instead required to await the application of the Plan i

in an individual casst i

Quoting Abbott, the Coun said that in deciding whether agency action is ripe for review, l

couns examine "both the ' fitness of the issues forjudicial decision' and the ' hardship to the panies of withholding court consideration.'"Id. at 6. This means considering, the Cotut said,

"(1) whether delayed review would cause hardship to the plaintiffs; (2) whetherjudicial j

intervention would inappropriately interfere with funher administrative action; and (3) whether the couns would benefit from further factual development of the issues presented." Id.

Applying that test to the Management Plan, the Court found that a delay ofjudicial consideration l

would not cause significant hardship, as the provisions of the Plan caused no " adverse effects of a strictly legal kind, that is, effects of a son that traditionally would have qualified as harm." Id.

The Court explained: "They do not command anyone to do anything or to refrain from doing anything; they do not grant, withhold, or modify any formal legal license, power, or authority;

1 l

l 6

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they do not subject anyone to any civil or criminal liability; they create no legal rights or obligations." Id 4

The Court went on to analyze the practical effects of the agency's actions on the plaintiffs and found that before the Plan could result in any significant practical harm,it would have to be applied in a specific case, where case-specific documents would be prepared, the affected public could be heard, and an aggrieved party could challenge the agency's action in court. (Such a challenge could include any arguments that the Plan itself was legally flawed.) Id at 7. The Coun observed, moreover, that there was no guarantee that the Plan would ever be applied in its present form; the agency might well revise or refine it before putting it into practice.

Similarly, the issuance of the Policy Statement has not changed the status quo one iota.

The Commission's letter denying reconsideration stated explicitly that the policy statement "did not create a binding rule or regulation." The policy statement established no substantive mle of law suitable for immediatejudicial oversight. Public Citizen v. NRC,940 F.2d 679,681-82 (D.C. Cir.1991). The Commission made clear that the eventuality that petitioners fear -- the imposition ofjoint and several liability -- will not even be " considered" except in " highly unusual situations where adequate protection of public health and safety would be compromised if such action were not taken." 62 Fed Reg. at 44077. The NRC explicitly acknowledged that co-owners and co-licensees generally divide costs and output on apro rata basis, pursuant to contractual arrangements, and said that it " believes that [this) should continue to be the operative practice." Id The prospect thatjoint and several liability will be imposed by the NRC is thus at best highly speculative. Indeed, the NRC Policy Statement, by declaring explicitly that only " highly l

m

7 unusual" circumstances can warrant even considering the imposition ofjoint and several liability, has arguably given the petitioners greater security against against future legal harm, rather than harming them. The time to address the legal question of whether the NRC can impose joint and several liability will be when, if at all, the issue arises in practice, in the context of the specific facts that the agency believes warrant the action. "Thejudicial process ze91d clearly gain by waiting for a concrete application." Public Citizen v. NBC,940 F.2d at 683. For the time being, the issue is too hypothetical and academic to be justiciable.

Moreover, it is entirely possible that there will never be a " concrete application," and that judicial review at this time would therefore be a profitless expenditure of this Court's time and effort. See Edison Electric Institute v. EPA,996 F.2d 326 (D.C. Cir.1993). As this Court has I

k said, in the context of fimding an issue unripe, the " central judicial interest in deferring resolution" of controversies " lies in the possibility that if the issue is not adjudicated at this time, it may not require adjudication at all." Friends ofKeeseville v. FERC,859 F.2d 230,235 (D.C.

Cir.1988).

The petitioners also have not shown, nor does it seem likely they could show, that they will " suffer any great hardship from waiting for judicial review in a more appropriate action."

Truckers Unitedfor Safety v. Federal Highway Administration,139 F.3d 934,1998 WL 151182, (D.C. Cir. Apr. 3,1998). There is no suggestion in the petition for review or in petitioners' docketing statement that they will be induced to " change their behavior in any significant way" by the issuance of the NRC Policy Statement.1998 WL 151182 *3. See also National Ass'n of Reg. Util. Com 'r3. Dept. ofEnergy,851 F.2d 1424,1429 (D.C. Cir.1988)("for nn institutional interest in deferral to be outweighed, postponing review must impose a hardship on the

l 8

' complaining party that is immediate, direct, and significant.")

i CONCLUSION All three prongs of the Ohio Forestry test argue against judicial conside' ration of petitioners' claims at this time. First, delaying cotut review appears likely to result in negligible harm to th' petitioners. Second, premature court review could interfere with the agency's ability e

to protect public health and safety in unusual circumstances. Third, specific facts, not now ascertainable, are likely to dictate not only whether the agency ever decides to impose joint and several liability on co-owners, but also whether that action is legallyjustified. Accordingly, the petition for review should be dismissed.

Respectfully submitted, F C'ORDES i

JO l' tor j

i j

j'/

Jv PETER G.yRANE Attorney j

Office of the General Counsel j

U.S. Nuclear Regulatory Commission Washington, D.C. 20555 -

301-415-1600 l

i Date: June 8,1998

)

'IN THE UNITED STATES COURT OF APPEALS FOR THE DISTRICT OF COLUMBIA CIRCUIT-

)

- AMERICAN PUBLIC POWER ASSOCIATION,

)

et al.,

)

Petitioners,

)

)

v.

)

No. 98-1219

)

UNITED STATES NUCLEAR REGULATORY COMMISSION )

and THE UNITED STATES OF AMERICA,

)

)

Respondents,

)

)

)

CERTIFICATE OF SERVICE I

I hereby certify that copies of the " Respondents' Motion to Dismiss" were served by first class mail this 8th day ofJune,1998, upon the following:

Gary J. Newell, Esq.

Martin G. Malsch, Esq.

Spiegel & McDiarmid Egan & Associates 1350 New York Avenue, NW 2300 N Street, NW Washington, DC 20005-4798 Washington,DC 20037 (AAc -

Peter G. Cyine, Attorney U.S. Nuclear Regulatory Commission Washington, D.C. 20555

/* se y

UNrTED STATES

{

NUCLEAR REGULATORY COMMISSION WASwwCTON.D.C. 30$88.ee01 HOT February 20. 1998 SECaffafn Gary J. Newell, Esq.

Spiegel & McDiarmid 1350 New York Avenue, N. W.

Washington, D. C. 20005 4798 RE:

FINAL POLICY STATEMENT ON THE RESTRUCTURING DEREGULATION OF THE ELECTRIC UTILITY INDUSTRY

Dear Mr. Newell:

By letter dated October 14,1997, you filed " Publicly Owned Systems' Request for Policy Statement in Order to Receive Additional Owned Systems requested that the Commissio pal Statement which addressed joint and several liability of co-owners /

For the following reasons, the Commission declines to reconsider or that portion of the Final Policy Statement.

private contractual arrangements. Moreover, it e policy. It set forth a view that the NRC may, under unusual, specific circu imposing joint and several responsibility on co-owners / licensees of nucl of policy creates no binding regulation or rule for licensees. See Limer a ement NRC, 869 F. 2d 719, 736 (3rd Cir.1989). Thus, no rights or obligations of affected by the policy statement.

In addition, the NRC has not stated that it will abrogate contractual re responsibilities orinterfere with a pro rata division of responsibility. In fact the NR a

acknowledged that pro rata division of responsibility is the norm, and should where public health and safety is adversely affect several responsibility in order to address the health and safety issue. Thi I

departure from previous Commission practice. See, e.g., Public Servic!

Hampshire (Seabrook Station, Units 1 and 2), CLl-88-10,28 NRC 573 (1 ew l

The Final Policy Statement is fully consistent with the " Proposed Ru Requirements for Decommissioning Nuclear Power Plants,"(62 Fed e

i 10,1997)), wherein the NRC noted that the broad imposition of joint and the level of financial assurance for decommission a ty for s ers saw no l

l k

$ fW A

'Ga%%%( 2pp

Q. Newell need to impose an additional regulatory obligation ofjoint liability on co-owners or ticensees." 62 Fed. Reg. 47588 at 47594. If the Publicly Owned Systems, n they may offer such comment with respect to the proposed The Commission did not intend to create additional uncertainty rega recognizing the present climate of electric utility restructu'ing. Rather, the to clearly state possible courses of action should circumstances dictat Statement does not impose any regulatory obligation on licensees. As st that under certain unusual circumstances, the NRC 14abilsty.

eral pending additional comment. The comment perio issues raised it is unlikely that an addrtional comm insight on this issue not previously brought to the attention of the Commission For the foregoing reasons, the Commission declines to reconsider or d the Final Policy Statement.

n of Sincerely, l

/g John C. Hoy, Secretary

/

l l

reunes negistir i Vol. 62. No.160 t Tusscay. August 19. 1997 / Ruits and Regulauons

440, l

restructunng cf tb clectne utihty andustry and th2 m ans by which reasons f:r thi NRC's cacstns. Some intends to address those concerns.NRC directly supported the NRC's overall c

approach, particularly the five actions Because of the interest expressed by hsted in Secuen ID. Commenter 14. for several commenters. the NRC extended example, stated that these five actions the public comment period to February should provide sufficient focus for NRC 9.1997/

acuens. Commenter 5 behoves that the D. Summary of and ReePonse to s curnm auhy is suEactent to g,"" *"'8 cope with any safety issues rsised by rate dereg'ilauen. Commenter 31 shares The NRC received 32 publitt the NRC s concems ht indicated that comments.on the draft policy statement: the draft policy statement did not 14 from electne utility licensees or their address the key issue. namely, w representadves. 8 from State public economic deregulatum of nuclear power utility commissions (PUCs) or other State agencies. 5 from public interest is compauble with the protection of groups. 4 from pnvate consultants and public health and :.afety, individuals, and 1 from a labor union, Other comments. panicularly from The followtng hst provides the names electric utility licensees and their npresentat' t ruggested that some and comment numbers referenced in NRC concerns are overstated. For NUCLEAR MEGUI.ATORY this nouce:

example. Commenter 4 recommended COMMIS$10N

1. Nuclear Informauon and Resource ehmination of language in te policy 3,,,,,,_,,,,,,,,,,,n,3a,,,qu,,,

statement that emphes that deregulation M CM Port M oei is inevstable. Other commenters

2. Pubh Service Commission of Wisconsm Final Policy Statement on the

3. Engineenns Apphed Sesences.inc.

suggested that the poucy statement Restructuring and Economic 4 TU Elecmc should recognize that change will occur Deregulation of the Electric Utility

5. Pubhc Sernce Elecme a Gas Company at different rates and therefore, the NRC industry

6. Minnesota Departroent of Pubhc Service should individually evaluate

{

7. Spa el A McDiamud on behalf of 5 restrucrunng as it affects each nyclear plant. In any case, restructuring will not agency: Nuclear Regulatory 3, gpft,hn$rpnse's.YCitinos Actionoccur so rapidly or secretly that the NRC Commission.

Coahuon ofIndiana. Inc., and Pubhc will not know about it. Others stated acTiow: Final Policy Statement.

Ciuun. inc.

that many services will remain suadadaRY: The U.S. Nuclear Regulatory

9. Wisconsin Emergency Management, regulated and that the PUCs will act Commission (NRClis issuiog this final Bunau of Technological Hazards responsibly. Funber, there as no basis statement of policy regarding its to. Ilhnois Department of Nuclear Safety for the NRC to conclude that licensees it. Internauonal Brotherhood of Elecincal expectations for. and intended approach Work'n will be unable to provide adequate to. its power reactor licensees as the

12. Consolidated Edison Company of New Enancial assurance for safe operauons electric utility industry moves from an environment of rate regulation toward n [*,f,* ot E' nergy and decommissioning. The National Association of Regulatory Uubty n

greater competition. The NRC has

14. CPU Nuclear Commissioners (NARUC) stated that in

15. Commonwealth Edison Company view of the expenmental nature of rnany concems about the possible eflects that rate deregulation and disaggngation

16. Vermont Depamnent of Pubhc Servus State actions the NRC.thould ap deregulation cautiously. Ftnally.p:cach

17. Maniyn Ehe resulting from various restructunng is. GE Stockholders' Alliance for a several actions tavolving power nactor sustainable Nuclear. Free Future commenters asked the Na'tC to evoid beensees could have on the protection.

• 9. Women speak out for Peace and lusuco actions that would serve as i

im diments to deregulation.

l of public health and safety.

.a New England Power Compeay trescTivt cars:This policy statement

""N*ic'18f '88 " **d R** u't*

Interest groups generally thought that mmenters npnsenung public S

becomes effective on October 20.1997 Foft FUMER INFoRhiaTic88 CoffraCf;

22. New lerwy Division of the Astepeyer CI' '

8 l

Advocaw

, gh dreeng ty con r la Robert 5. Wood.Of$ce of Nuclear

23. Southern California rdison company related to deregulation. These Reactor Regulation. U.S. Nuclear

24. Entergy opneuons. lac.

3 Regulatory Commtasion. Washington,

25. Nuclear Energy Insutute cornmutm stated that de NRC shmid DC 20555-0001. telephone (301) 415-

26. Ansons Pubhc Service Compsey take immediate action with respect to on line maintenance rectices, extended 1235, e-mail RSW1Garegov.

27. Manschusens ofEco of the Anarney refueling cycles and ownume dunng General supfunestrAmy esposusaficec

28. Winston and Strewn on behalf of the refueling, and up front funding of ac gro Utihty Decamerussioning CreuP decommissioning, among other issues.

29. Deve Crowford and Diane Peteresa Some suggested that the policy On September 23.1996, the NRC 3a National Ruramecmc Cooperenw statement specifically include issued a draft policy statement for

,',g".

discussion of possible negauve safety Public comment (61 FR 49711). The n

echnical Casulugh risks from economic deregulation. such Purpose of the draft policy statement

32. Neunal Apocsaum of Regulatory Udhty as cutting corners and defernng capstal Comnuusoner, was to NRC provide a discussion of the investments. These commente also

oncems regarding the potential General Comments urged the NRC to expand its inspection salmy impacts on NRC power reactor 4

hoensees which could resset from the Most commenters viewed the and compliance resources to counter the economic deregulat20n and issuance of the drsft policy statement as adverse safety impacts that these commenters believe will result from timely and appeared to understand the deregulataan.

ATTACMENT l

/

vct. 62. No.160 / Tuzsday. August 19. 1997 / ituiss and Regulations

-....., negsscr e NRC's Aespcass to Censret comm:nes st:ted that ths synphasis and focus en Regarding th;isave sf wh:thIt the em:rpacy planning m2y lessen.

patsnutiimpract of ecensmic pohey statement should ad ress the Commenter 10 suggested that the NRC's demgulation on specific safety programs e

shift to performance based and risk.

and preeuces. As discussed m the compatibility betwenn eco c

informed regulanons may potentially NRC's response to general comments, deregulation and the protech "dgthruten established safety marpms.

the NRC will cont 2nue to evaluate nubbe health and samty, N

lobeves that economic deregu ation This commeater urged the NRC to specific safety concerns or 10 CFR 50.59 reva w hos not preclude adequate protocuan establish cunent, vigorous robabilistic to: esses as part ofits safety of pubhc bulth and safety. However, risk assessments (PRAsl to fdentify the oversig t programs.Forexar'spie on-line mamtenance and meressed fuel due to the increased uncertainty nsks, which would be used in all engended by state-by state appropnate areas of plant operation as bumup a being considemd through deregu'at on of the electnc power a comerstone to maintaining cost-the NRC's safety review and inspecuon industry, the NRC is concerned about ~

effective safety margins in a changing ovmight prograros. Reducuens in manpower and training costs. and other the possible impact on the protection of environment.

public health and safety. Thus. in the Ntany commenters did not view nductions in operation and draft policy statement. the NRC deregulation as necessarily a maintenance (O&M) and capital expressed its general concerns about the disincentin to safe operation. They additions budgets are of contmums possible effects of deregulation cated the incentive to operate safely and concem to the NRC. The NRCis considering changes to the Senior ruhzmg that such concerns can. be use prewntive maintenance due to the Manasement Meeting process that either vitiated or exacerbated depending. Another commenter expressed the belie premium placed on unit evellability..

wouldinclude consideration of on specine deregulation approaches that are implemented. In this respect. the that near-term economic incentives omst mnds. However, because the NRC recogruses that deregulation will for expenditures to maintam tallable safety concems that commenters occur at different times,in different operation. However. this incentive expressed exast, in many cases.

. degrees. and in sorre lunsd2ctions.

decreases as a plant ages and thus is c,f independently of economic perhaps not at all, and the Anal policy greater concem la:er in a plant's life.

deregulation, the NRC behoves that statement more explicitly recogntaes Commenter 23 suggested that the policy these issues have been and are more these facts. With respect to the concerns statement be modined to support a appropriately considered in othat NRC expressed by public hterest groups licensee's use of the 10 CFR 50.59 programs. Alsoindependently of about the irnpact of certain review process to determine that economic deregulauon. the NRC is Safety practices. such as on potenual establishment of an Independent System stnving to make its regulatory program line mamtenance and outage duration, the Oppstor (150) does not invoin an as afficient and effective as possible--

NRC has addressed, and will conunue unnviewed safety question.

through use of risk analysts and other to address /these issues as safety issues.

Othw commenters mdicated that techniques-se that the resources of the This policy statement is not meant to be disincentives to safe opereuon should agency and of licensees are devoted to a substitute for regulatory remedies to be dealt with by limiung reactor the most safety.signi5 cant matters.

speciAc safety probleras.

operating cycles to 18 months and The NRC has extensively reviewed requiring at least 250 hours0.00289 days <br />0.0694 hours <br />4.133598e-4 weeks <br />9.5125e-5 months <br /> for refueling State performance incenuw programs and does not believe signincant SuffscsencyofCurwn: Regulatory outages. These commenters also osed on line maintenance.

additional review is warranted at tius Framework andincentsvesforSafe opfnother commenter expreseedtime. (See footnote 2 in the Policy Operadon Although most commenters indicated concem that deregulation would be a Statement below.I that the NRC's current regulatory disincentive to continuing cooperation MnonciaQua@muont framework is adequate to protect public among nucker generefors, such as early Commenters expressed vaned health and safety, o*hers disagreed.

sporung of safety and operationally opinions. AlthouS some vwwod b h

Commenter 21.for example, cited the significant events and continuation of expwience with the Millstone bcility the Institute of Nuclear Power NRC's current financial quali$cauons and indicated that it is "ofinceastasOperations (INPO). Additionally,the regulatory framework as sufficient.

concem that NRC cannot accurately pressure on the NRC to reduce costs to others believed that addiuonal measures determine the extent and scope that hcansees will increase, as will pressure may be necessary. Commenter 20 indicated that the critical question for economics plays in the reductions of to mduce use of the " watch hat."This the NRC is whether. in the absence of roector safety ma25 ins and the delstral commenter cited the analogy of the independent Snancial assuranas to the of safety significant issues." This resuhant events at the Federal AvistionNRC from its licensees < rate regulators commentw concluded that the Administration (FAA) when the airunes have committed to provide beensees statement has not adequately won deregulated and urged the NRC to with sufReient Anancial resources.

safety hazards brought aboutb avoid the FANS mistehen. This Commenter 2 stated that if recovery of F

managerial malpractice in msponse to. commenter also suggested that incentive stranded costs is not allowed or is economic pressures. Other commenters regulation of nuclear plants may become 8Ml mstricted, a large number of Y

stated that the NRC must continue to an ahernative to full deregulation and Premature shutdowns may occur, ensure that its own inspection and that the NRC should studyinantive further straining hmJ financial oversight prograros identify when a programs used at Diablo Canyon and

. quaHBcations and diminishing their licensee is failing to devote sufBeiset

Pilgrim, ability to stea==iaaion safely. in this msources to ensuring sah operations.

NAC"s,Aeeponse to Comments an vein, Commenter is urged that the NRC speci6cally as a resuh of deBciencias Sufficsenc aggressively affirm that stranded ca Framewor*yof Current Regulatory /*

costs must be recovered by utiliues.pital resulting frorn economic pressure. When andlncentsvosforSp necessary, the NRC should Opemuon Comrnenter 13 indicated that those i

additionalinspection and com liance The NRC shares many of the concerns longer rete regulated should have nucksr j@t licensees that are no sources from Congresa. Commenter 9 expressed by commenters about the sufEcient buffering funds to proceed M

Federal Register / Vcl. 62. No.160 / Tu sday. August 19, 1997 / RulIs and Regulations 44073 safely from c 4ons 13 obligations in its deliberations on decommissioning. Commenter a stated financial quah5 canons.

does not believe that Section 184 of the that the NRC should stut down the Atomic F.nergy Act of 1954. as amended.

lants oflicensees with questionable ggg., pup,,,,,,,g, g,,,

allows the NRC to approve transfers by knancialability to sustain seie 7a.nonc>,j M$cotions "n$stiv nsent."

Te will continue to use its operations in a competitive The!qtC mrnains concemed about environment and should require them to the impacts of deregulation on its power curant method of evaluaung a decommission their facilities. Operating reactorlicensees* Anancial licensee's cash flow under 10 CFR 140.21 to determine a licenses's ability costs that cannot be recovered quali5 cations. The NRC's existing to pay deferred premiums under the compeutively should be borne by b regulatory framework under to CFR Pnce-Anderson Act.

, licensee, not the ratepayer or the 50.33(f) requires financial qual 15 cations taxpayer. Commenter 22 believes that reviews for those licensees that no Decommissioning runding Assurtmee the NRC should institute ongoing longer meet the defaition of " electric The consensus appeared to be that the Snancial qualifications reviews every 2 utlhty"at the operating license (01.1 NRC should work closely with State to 5 years for all power reactor stage. P ph 4 of to CFR 50.33(f) regulators to provide for assurance of licensees, including those that still meet also provi that the NRC may seek de: commissioning funding. Commenter the NRC's defination of"electnc additional or more detailed information 13 recommended that the policy

)

utility." Commenter 31 recommends respectmg an applicant's or a licensee's statement include a call for tha that the NRC examine whether merprs Snancialarrangements and sistus of conttaued recovery of decomrnassionmg and joint operating agreements would funds if thdammunion considers this costs through regulated rates and tanffs dilute or weaken unats and utilities ht information appropriate. The NRC will in all junsaictions. Similarly, are performing well by spresding or evaluate additaonal rulemaking. separate Commenter 16 suggested that the NRC

)

diverting existag management frotn the proposed rulemaking o.

mamtsin swanness of State attention, personnel, and other financial assursace requirements for resources over a larger number of unita. decommissioning, to determine whether decommissioning proceedmss.

funding adequacy based on the Ohr :ommentm appeamd qwte enhancements to its Annamat estimates produced in State optimistic that additional financial quali5 cations requirements are proceedags, and work with the host qualiscations reviews would be necessary in anticipation that some State to ensure that adequate amounts l

una-- y. Commenter 15 suggested Power reactor licensees will no longer are provided in decommissioning trust that the NRC should avoid confhets be " electric utilities." However, the funds. Another commentar stated that with other agendes having jurisdiction NRC continues to believe that its additional decommissioning funding i

over financial quah5cetions and should Pnmary tool for evaluates and ensuring assursace should be aquired on an not condition license transfers.

safe operations at its licused facilities hoc basis and that the NRC should not Commenter 25 and others indicated that is through its inspection and requin accelerated decommissianmg holding companies should not be enforcement

.in its previous funding.

subject to 10 CFR 50.80 license transfer experience.

NRC has found that Many State and licensee commenters reviews. At nost, the NRC should use there is only an indirect mlationship asked the NRC to accept non bypassable a " negative ct.ssent" approach to between financial quali5 cations and charges or ohrinschanisms such as formation of holding companies. This operational safety, but it is continuing to dedicated revenue stmams, as proof of commentar also recommended that the study this issue. Although enhanced decommissioning funding assurance.

NRC provide more explicit guidance on Snancial quali5cetions reviews may Similarly, those licensees whose States the "no signiscant hazards" critana that Provide the NRC with valuable require such mechanisms should be are used with license amendments.

additionalinsights on a licensee's considered " electric utihties" under the Commenter 23 asked that the NRC adopt clear cntena for approval of general quali5 cations to opereta its NRC's regulations. Many commenters facilities safely, it is not clear that also svagested that the NRC take a more license transfer requests and use clear, enhaar =d Anaar i=1 cetions proactsve role with the Congress. the unambiguous standards for licanas programs by th vos wo.ald prove to Executive Branch, and othm in order to transfers to non utility licensees such as those efferedin the DreA Standard be a suf5cient indicator of general inc~-,e assurance of decommissionag Review plan (SRF) on Fin:%st ability to operate a fedlity safely.

bas.

With respect tothe issue of Quali5 cations and fwa=='aving W=ia-ioning and stranded coms, Most public interest group Funding Assurance (81 FR es30s, many states are considerms and " fund es-you go" decommissioning commenters advocated that the NRC December 27.190s). De onsin securitinstion as a non-by by requinag full. up front to CFR 50.33(f) for non Hr=a-darse mechanism to fundthe recovery decommissioning for unfunded should be modifled and include of decomminioning. and other stranded balances. nese commenters also asked standards for extended, unplanned costs. De NRC believes that that any stranded cost recovery be outages, such as minimen amounts for secuntization has the potential to applied to external decommissioning ntained enmings. W w and provide an acceptable method of trusts and that investors bear the greater contractual arrangements.

decommissiontag funding assurance.

. share in bding any decommissiorung Commenter 22 sugested that although other mechanisms that involve shostfall. Other comments sought the "securttiastion"may be an non4,ypassable charges may provide ehmmation ofinternal advantageous mahod of reducing comparable levels of assurance and deca==i==ioning funding and asked stranded cost to customers.

should not be excluded from that decommissioning be funded at a Consequently,the should and' ores consideration by State authorities.

level that would peruut a third party to securttiastion as With res to transfers of a license complete decomuntasioning.

regulatory, legal,permisable from a and public policy under to 50.80, the NRC must Other speciSc comments in the perspecuve.

review and approve in wnting all such decommissioning area included (1) a Finally, two commenters urged the transfers. If such transfers meet the recommendation that the NRC add an NRC to inctor in Pncer. Anderson appropnate NRC standards. De NRC explicit statement to the pohey

\\

J

44074 Fed:ral Register / Vol. 62. Ns.160 / Tuxsday. August 19.1997 / Ruiss and Regulations statement that would inform licensees should take a more proective role and alter.and likely peopardtze.the business of the NRC's nght to assess the tuning that h NRC can play a special role in arrangements that underptn co-and liquidity of decommissioning funds educating rate regulators. Commenter 22 ownership. Several of those whc (Commenter 3);(2) a recommendation proposed that the NRC maintain a commented on this issue also pointed to for an increase in decommiaaioning dialogue with all classes of ratepayes.

the bankruptcy laws as one way of reporting mquirements and assurance perhaps through the National ensunng that co-owners pay their pro that funds are not diverted to non.

Association of State Utility Consumer rata share. although Commenter 22 decommissioning uses: (3) recognition Advocates. Other suggested venues for suggested that recent NRC experience ht if charges are placed on cunent NRC State regulatory interface included with bankrupt bcensees may not hold electricity customers while competition the NationalGovernors Assocastion the true m the future. No one directly increases, consurt. ors will avoid nuclear National Confuence nf State commented on the issue of non owner pown and will. therefore, avoid Legislatures,the American Legisistin operators. although 3 comments contributing to decommissioning Exchange, and similar groups addressed this issue penpherally.

Iunding; and (4) recognition that (Commenter 25). Commenter 15 MC e8Ponse to Comments on Joint decommissioning is not a stranded cost, suggested that the NRC and NARUC 87 t.*cause stranded costs are known and convene a joint conference on stranded met surable costs that have already been capital cost reconry. As previously N NRC recognizes that co-owners inened whereas decammissiorung mentioned, several commenters and co-licensees generally divide costs costs are not fully known and have yet indicated that the NRC should act to and output from their facilities by using to be incurred.

educate Congress and seek legislation in a contractually-denned, pro rata share mci Response to Comments on areas relevant to plant safety and standard.The NRC has implicitly Decomattssioning funding Assusence astructunng. for example. a national accepted this practice in the past and excise tax to fund decommissioning.

believes that it should continue to be Many of these comments parallel Finally. Commenter 22 suggested that the operative practica, but reserves the comments received on the Advance the NRC review the States' plans for cost nght,in highly unusual situations Notice of Proposed Rulemaking (ANFR) recovery to ensure that once recowred where adequate protection of public (61 FR 15427. April 8.1996) that sought through rates, these revenues are health and safety would be comment on res ructuring issues as they employed for the purpose for which compromised if such action were not may relate to decommissioning funding they were collected.

taken, to consider imposing joint and assurance. The NRC is denloping a severalliability on co-owners of more proposed rule that considers most of MC'8 E'5Ponse to Comments on than de minunis shams when one or these comments. With respect to the Regulmorylaterface more co-owners have defaulted. N specinc comment that the policy N NRC believes that the policy NRC is addressing 6 issue of non-statement should indicate that NRC statement adequately cowred the NRC's owner operators separetely.

retains the nght to assess the timing and intent to work closely with rate Antitrust liquidity of decommissioning funds, the regulators and othws as deregulation NRC agrees and will add such a proceeds. The NRC will consider Most commenters viewed NRC statement. Because of the long history of expanding contacts to include the other antitrust reviews as redundant to those effective rate regulatory outsight and groups identi6ed. Although the NRC performed by other agencies, especially recovery of safety.related expenses will testify before Congress when asked in view of FERC Order 884.and through rates. in the iets to speak on its views on deregulation as recommended that the NRC act to decommissioning rule (53 FR 24015.

related to protecting public health and eliminate this redundanev. Commenter June 27,1988) the NRC deferred to the safety,the NRC is evaluating whether it 22 suggested that h NRC develop a PUCs and the Federal Energy Regulatory should make spec 1Ac rara==aadations memorendum of undsstanding with Commission (FERC) on the timing and on machmaia== to handle FERC and the Securities and heu==

liquidity of decornminaioning trust fund dara==iasioning costs and operational Commission (SEC) that would allow the deposits. Howowr, the NRC has the costs. The NRC recognises that Federal NRC to rely on the judgments of these j

authonty to assess the timing and legislation might be of benent in agencias about market power that do not liquidity of such deposits by its resolving these issues. However, the raise issues unique to the NRC's licensees, and intends to exercise this NRC also recognises b vital role that mandate. Another commenter.

authonty with those licensees who Ices States have played and will continue to

--anded working with the rate regulatory oversight. Similarly,10 play in resolving these issues and is Department of Justice to develoo a list CFR 50.52 speci5es a schedule ist fully prepared to work with the States of guidelines and criteria to evaluate decommissioning trust head through either State or federally requests for ownership changes.

withdrawals and the NRC will thus sponsored initiatives.

C^i e

sees e of k

MC's Resp to Commets on jth foint Ownership Antitrust i

Virtually all who commentedin this b NRC is statutorily required under l

Regulatorylaterfoe' ares believe that the NRC should not the Atomic Energy Act of1954.as Most commenters support NRC's impose joint and several liability on co-amended (AEA). In connection with an j

working closely with State and Federal owners of nuclear plants. Rather, each application for a license to construct or l

rete regulators, although soon public co owner should be limited to its pro operate a facili under section 103. to interest groups stated that such an e5 art reta share of operating and evaluate an a

's or a licensee's would olfer scant protecsion to the decomminaioning expenses.N NRC activities un the NRC license to public (Commenter 17). Many thought should not look to one owner to " ball determine that these activities do not that the focus of this cooperation should out" another owner. Commenter 2a create or mamtain a situation be on the assurance of mco of suggested that any effort to altar the inconsistent with the antitrust laws of I

deccanmissioning costs.

cunent legal and Anancial relationship b United States. However.6 NRC commenters believe that the NRC among co owners would retroactively has begun to work with FERC. SEC. and I

ynumy. stugust sv.1997 i Kutes anc Regulations 44075 the Department cf Justice ta develop Diuggngsuon may involve utility require its oth:r licensees (wtth the methods by which the NRC can rutructuring, mergers. and corporate cdd:d excepti:n cf Staa and FedIral I

mirumize duplicauon of effort on spmoffs that lead to changes in owners geveniment licensees of certam anutrust issues, while carrying out its or operators ofIlcensed pown reactors facilities) to provide fundmg assurance statutory responsibilities. The NRC will and may cause some licensees, for the fedt estimated cost of

4o consider sukmg legislation to including owners, to cease being an decommissioning. either through full earws m review to the extent that its "electnt utility" as defined in to CFR up front funding or by some allowable review duplicatu the effcrts of other 50.2.' Such changes may affect the guarantee or surety mechanism.

federal agencies.

licensing basis under which the NRC A discussion of the NRC revww Othuluu" criginally found a licensa to be process is contained in two draft financially quali5ed. either as an Standard Review Plans (SRPsl that the Several commenters made "electne utility" or otherwise. to NRC issued for comment: NUREG-1577 observations not directly addressed in construct. operate, or own its power

" Standard Review Plan on Power the draft policy statement. Commenter 5 plant as well as to accumulate adequate Reactor Licensee Financial stated that nuclear plant operators in the funds to ensure decommissioning at the Qualifications and Decommissioning Northeast Unsted Statu are subsidizmg and of reactor life. (See discussion Funding Assurance"(January 1997);

dirtier coal geneiation from Watern below.)

and NUREG-1574. " Standard Review U.S. generators. Accordingly, the NRC Rate regulators have typically allowed Plan on Antitrust"(January 1997). In should articulate its views on the nwd an electnc utility to recover addition. the NRC issued an l

for nuclear power and its value for fuel incurnd costs of genersung, prudently Administrative Letter on June 21.1996.

diversity and environmental protection. transmittmg. and distnbuung electric that inforrned power reactor licensees of Commenter 16 recommended that the services. Conwquently, in 1984, the their ongoing responsibility to mform NRC the Department of Energy to NRC eliminated financial qualifications and obtain advance approval from the proc with intenm spent fuel storage reviews at the OL stage for those NRC for any changes that would to nduce uncertainty and costs facmg licennes that met the definition of constitute a transfer of the license.

nuclear plant operstors.

"electne utility"in to CFR 50.2 (49 FR directly or indirectly, through transfer of-NRC's Response to Comments on other 35747. September 12.1984). The NRC control of the NRC licann to any person j

fyy, based this decision on the assumption pursuant to 10 CFR 50.80. This 1

that "the rate procus assures that funds admmistrative letter also reminded The NRC does not have a role in needed for safe opersuon will be made addressees of their responsibility to advocating the positions stated in these available to regulated electnc utilities" ensure that information regarding a L

comments.

(49 FR 35747, at 35750). However, the licensee's financial qualifications and I

Policy Statement NRC recognized that financial decommissioning funding assurance I. Basis qualificauens reviews for OL applicants that may have a signincant implicauon f

might be appropnate in particular cases for public health and safety is promptly 1

This poliev statement recognizes the in which. for example. "the local public reported to the NRC.

{

changes that are occurnng in the electnc utility commission will not allow the utility industry and the importance total cost of operating the facility to be g, pg, pg, f

i these changes may have for the NRC and recovered through rates"(49 FR 35747 The NRC is concerned about the its licensees. The NRC's pnncipal at 35751). The Commission also has Potential impact of utility restructunng mission is to regulate the nation's expressed concern about various State on public hulth and safety. The NRC civilian use of byproduct. source, and proposais to implement economic has not found a consistent reisuonchip rpecial nuclear matenals to ensure performance incentive programs.:

between a license (s financzal health adequate protection of putilic health and in its 1988 decommissionmg rule, & and generalindicators of safety such as safety, to promote the common defense NRC again distinguished between the NRC's Systematic Assessment of l

and secunty, and to protect the electnc utilities and other licensees by Licensee Performance. The NRC has environment. As part of carrytng out allowing " electric utilities" to traditionally relied on its inspection this mission, the NRC must monitor accumulate funds for decommissioning process to indicate when safety 6

licensee activities and any changes in over the remaining terms of their Performance has begun to show adverse licensee activities, as well as external oPersting licenses. NRC regulations trends. On the bests ofinspectson factors that may affect the ability of Program results. 6 NRC can take individual licensees to safely operate

' sam.e so.: deria eineme mutary.s y

appropriate action including, and decommissioilicensed power muty de sen==im = disebuta eiuiricacy.a4 ultimately plant shutdown,to protect

[

production facilities.

O,"'"m"O*,"M',.Nd' h Public hesith and safety. However,if a lplant,is permanently shut down. that i

U. Rock und P ant

• • '"7 "8*l'" *F * ".4 uniticia imew'eig P"* 'usul*" y 8

u serry.ta n.ier. -n i

The electric utility industry la sma==cos sad d>.mbuti = absean pubiac access to adequate revenues or other i

entenng a penod of economic simiy aumei. u.icip.2m runs i.eme sources of funds for decommissioning I'

dar gulation and restructunng thatis Z "," g*sy,i..nd r.dN.'s. ins.

the facility. !f rate degulauon and mtended to lud to increased u, r anews.e.iain a.

.r i.eme nury. -

organizational divestiture occur l

compeution in b ladustry. Incrossmg e sa remibt. s sny tap.m..t s---*

concurantly with h shutdown of a competition may force integrated power Pw'armance lac =maa: nant petic, siet et. (se nuclear plant eibt by NRC acton or by l

systems to separate (or "disaggregate")

E3*8[3181*$l"

• • g*

a license (s economic dec2sion that their systems into functional areas.

y, g.,e, a.4 p,.,,.m tg.,aic in, licensee may not be able to provide Thus, some licensees may divest swa insurui.d many era pa r.su u. a a.

.iecincai genmuon amets irom et.-u.i.on..wm.. s m.

ad*Luste assurance of decommissionmg fun. Thus. th. NRC d.n.ves that its nemission and distribution assets by

'*g,$*g* mQs t emg.

concerns about de ation and rming separate subsidianos or even p,tamane me.%= p,g,.m.w my, e.

restructunns lie in e arms of separate companies for generation.

repi.e d by Mi mars.: camp.un.e.

adequacy of decommissionmg funds I

44076 Federal Register / Vcl. 62. No.160 / Tussday. August 19. 1997 / Rul:s and Regulations and the potentia 1 affect that scenomic la censid:ratJon cf these concerna.

B. NRC Responsibility:s he.vis State dmgulation may have on opereuonal the NRC will evaluate deregulauon and and Federal Economic Regulators e.gny.

restructunng activities as they evolve.

The NRC has recograzed the pnmary As the electne utlhty industry moves Recognizing that the electric utility role that State and Fedwal economic som an environment of substantial industryis likely to undergo greet pgulators have sernd. and in many economic regulation to one of increased change. as restructunng progresses. the cases will continue to serve. in settmg competition, the NRC is concerned NRC will continue to evaluate the need rates that include appropnate levels of about the pace of restructunng and rate for regulatory or policy changes to meet funding for safe operation and deregulauon. Approval of organizational the effects of deregulation. The NRC decommissioning. For emarnplc.the and rate dmgulauen changes may will take all appropriate actiens to carry preamble to the 1988 d:commusionmg occur rapidly. The pace and degree of out its mission to protect the health and rule contained the following statement:

such changes could affect the factual safety of the public and to the extent of "The rule. and the NRC's underpinnings of the NRC's previous its statutory mandate, to ensure implementation ofit. does not deal with conclusions that power reactor licensees consistency with Fedml antitrust laws. Enancsal ratemaking issues such as rate have access to adequate funds for opereuons and can reliably accumulate The NRC intends to implement of fund collection, procedures for fund adequate funds for decommissioning s an ake "be collection, cost to ratepayers, taxatson effects equatabihty between early and over the opwoung lives of their ey

.n oe facilities. For example, rate deregulation powe mctor heensus remain late retepeyers. eccou.t2ng procedums, could create situations in which a ananciall qualified to ensum ratepayer versus stockholder licensee that previously met the NRC's continue safe operations and cons derations, responsiveness to dennition of an "electnc utility" under decommissioning. In summary, the NRC chup ad oen sunnu concerns

,,. These matters are outside NRC's to CFR $0.2 may, at some point, no Will-junsdiction and are the responsibihty of longer qualify for such status. At that e Contmue to conduct its financial the State PUCs and (the Fedem! Ener'gy point, the NRC will require licensees to quellAcetions, decommissioning Regulatory Commission) FERC"(53 FR submit proof pursuant to to CFR funding and antitrust reviews as 24018. June 27.1988, at 24038).

50.33!0(4) that they remain Anancially described in the SRPs developed in Notwithstanding the pnmary role of ushned and will require them to meet concert with.this policy statement; economic pgulators in rete matters. the e mon sinngent decosnmissioning funding assurunca requirements of to

. Identify all owners, indirect as well NRC has authonty.under the AEA to CFR 50.75 that are apphcable to non-as & rect. of nuclear power plants; taka actions that may af'ect a heensee's financial situation when these acnons electne utihties.

• Estabush and maintain worksag Although new and unique relationships with State and Federal rete are wananted to protect public health restructunng proposals will necessarily regulators: and and safety. To date, the NRC has found

. no signi5 cant instances in which State involva case-by case reviews by the e Reevaluate its regulations for their or Federal rete regulation has led to NRC. the NRC staff will advise the adequacy to address changes resultmg - disallowance of funds for safety related Commission of such proposals so that from rate degulation.

opmtional and decommissierung the Commission will have the option of expenses. Some rate regulators rney exercismg direct ovmight of such A. Adequacy of Current Regulatory reviews to maintain consistent NRC Framework have chosen to mduce allowable pro 6t margins throu6 rata disallowances. or b

pohey toward new entities. As pattwas of restructunns bestn to ememe. the The NRC believes that its agulatory licensees have for other masons NRC will consider standardisms its framework is generally sufEcient at this encounted AnancialdfEcchy.

framework further to streamune, where time to address the and In wderfw 2e MC to make its sah views known and to encourage rete possible,its case by-case review

,,, g,

[ wing adequate expendatum btm to co process. The NRC has considered, and a resuh of electne utih deregulation.

will continue to consider mergers and Absent chan8'a to the a regulat"'I the outnght sales of faciuties, or adame. the NRCs sem.w process will nuclear plant safety as electnc utihtaes portions of facilities, to require NRC

. foHw 6e curant framewwk. The NRC face deregulation, the NRC has taken a number of actions to increase noti 5 cation and prior a prevalin hohem eatits Enancial quahacsucos accordance with to CF 50.80 in orde requmaments are suf5ciently broad as to coopation with State and Federal rate to ensure that the transferee or hoensee Pmvide an adequate framework to and fLnancial regulators to promote dial-is appropnately quali8ed. For'examnie, adequately review new or unique rate 7m~e and minimize the possibihty of guladon w mhw acnons em in certain merger situatisma, the NRd situations that am not explicitly covend would have an adverse effect on safety.

determines whether the survivhis in to CFR 50.33(0 and appendix C to The NRC intends to continue to work organization will remain an " electric part 50. for Saancial quali5 cations, and and consult with the State PUCa.

utility" as de$ned in 10 GR 50.L If a in to CFR 50.75 for decommissioning i

license applicant or a licanase dails to funding assurance. However, in order to individually or through NARUC. and with FTRC and other Federal agencies to meet this definitjan, the NRC will seek remove any ambiguities in its coordinate activities and exchangs additional assurance of Saancial regulations and to address those.

information. However. the Comnussion qual 15 cations to ope;ste and situatinos that may not be adequately also reserves the Bezibility to take decommission the facihty pursuant to covered under cunent regulations, the appropriate steps in order to assum a 10 CFR 50.33(0 and 50.75 and as NRC is considerms rulemaking to revise hcensee's adequate accumulauon of discussed in more detailinits SRP on its decommissioning funding assumaco decommissioning funds.

these subjects.The NRC has also requirements. as desenbod in 4ection advised licensees that the formadan of IILE. The NRC is evaluanns whether C. Ca4wner !)ivision of Responsibihty holding companies requuss antiScotton modi 8 cation to its financial Many of the NRC's pwer reactor and approval pursuant to 10 CPR 50.80.

quah5 cations regulations are warranted. licensees own their piants jotntly with

I Federal Register / Vcl. 62. No.160 / Tuesday. August 19. 1997 / Rules and Regulanons 44077 other, umeisted organizations. Ahhough capability for safe cperanon and F. Antitrust Reviews some co-owners may only be authorized decommissioning that could arise from to have an ownemhip interest in the rate deregulation and astructunng

- The NRC is statutorily required under the AEA in connection with an nuclear facility and its nuclear matenal.

Section 184 of the AEA and 10 CFR applicassen for a license to construct or and not to operate it. the NRC views all 50.80 provide that no license shall be operate a facility under section 103 to co. owners as co licensees who are transfesrod, directly or indirectly, evaluate an applicant's or a licensee's responsible for comp)ying with the through transfer of control of the acuvities under b NRC heense to terms of their licenses. See Public license, unless the Commission determine whether these activiues service Company ofindiano, fac.

consents in wnung.The NRC will create or maintaan a situation (Marble Hill Nuclear Generating Station. continue to sview transfers to inconsistent with the anutrust laws of Uruts 1 and 21. ALA5-459. 7 NRC 179.

determine their potentialimpact on the the United States. However, the NRC 200.-201 (1978). The NRC is concerned licensee's ability both to maantain will explor, with FERC, SEC. and the about the effects on the availability of adequate technical quali6 cations and Department of Justice methods by which operating and decommissiorung funds.

organiastional control and authonty the NRC can minimize duplication of and about the division of responsibility over the facility and to provide adequate effort on antitrust issues. while for operaung and decommissioning funds for safe operation and maintauung its statutory funds when co-owners Sie for decommissioning. Such consent is responsibilities. The NRC will consider bankruptcy or otherwise encounter clearly required when a corporate entity seeking legislation eliminaung its financial difRculty.8 The NRL seeks to transfer s tiranea it holds to a review mandate to the extent that NRC recognises that co-oners and *.o.

different corporote entity. See Long reviews are duplicated by other licensees geners!!y divide costs and Island ughung Co. (Shomham Nucieet agencies.

output frem their facilities using a Power Stetson. Unit il CLI-92-4. 35 The NRC anticipates that compentave

• contractually defined., pro rata share NRC 89 (19921. The NRC staff has myiews over the next 5 to 10 years will stancard. The NRC has implicitly advised licensees that agency consent anse pnmarily from changes in control accepted this praima in the past and must be sought and obtained under to of licensed facilities. N regulatory believes that it should continue to be CFR 50.80 for the formation of a new review addressing transfer of control of the operative practice, but reserves the holding company over an existing licenses under to CFR 50.80 will be t naht. in highly unusual situations licensee. Ohr types of transactions.

used to determine whether new owners l wbm adequate protection of pubhc including where non. licensee or operators will be subject to an NRC

. heslth and safety would be orgamasuons are proposed to have some myiew with respect to anutrust matters.

< compromised if such acuon were not degree ofinvolvement in the

? taken. to consider imposing joint and management or operation of the plant.

Small Busmens Regulatory Enfmment severalliability on co-owners of more have been considered by the staff an a Faarness Act than de mimmis shares when one or case-by-case basis to determine whether In accordance with th, Small more co-owners have defaulted.

1D CMt 50.80 consent is required. &

Bustness story Enforc=mnt Act rf

'I D. Financial Qualifications Reviews NRC is evaluating what types of 1996,the has determined that d.as f

rntructug should be action is not a **@ rule" and has N NRC believes that the existing subject to 10 CFR 50.80 review. The verified this determination wnh the regulatory framework contained in to NRC staff willinform the Commission ofEco ofInformatinn and Regulatory CFR 50.33(f) and in the guidance in 10 of unique or unusuallicensee Affairs. Of5cm of Management and CFR Part 50. Appendix C. is generally restructuring actions.

Budget.

$)g#f,h*I

.,,urance cial E. Decommissioning Funding Assurance Electronic Access qualifications of both el atility and R**"'

N NRC electronic Bulletin Board non.electne utility applicants and h NRC believes that the existing System (885) on FedWorld may be licensees under b vartous ownership decommissioning funding assurance accessed by using a personal computer.

arrangements of which the staffis provisions in to CFR 50.75 generally a modem. and one of the commonly currently swam. f tema=aas that resin provide an adequate regulatory basis for available communications software

" electric utilities" will not be subject to existing and possible new licensees to packages, or directly by way ofInternet.

NRC financial quattacartons misw.

provide reasonable assurance of Backsmund documents on the final other than to determine that such decommissioning funds. However, to policy statement are also available. as beenwes. in incs.nemais " electric examine this and other issues related to practical for downloading and viewing 1

utiuties." However, the NRC is decommissioning funding assurance in on the bulletin board.

realuating the need to develop anticipation of rate deregulation, the ifusin additional requirements to enswo NRC published an ANPA (61 FR 15427, anodem.g a personal computer and the NRC subsystem on against potential diluties of the April 3,19961. N NRCis considenng FedWorld can be accessed directly by a proposed rulemaking developed in the toll. free number (tool 303-8 N NRC has had upensas wth them 195ponse to the comments feceived on 9872.

unication software IO[*,s'g'",$"",',",8,",j"",,gh the ANFR. In addition. the NRC wishes

• parameters should be set as follows:

Aled vader 18 of the U.S. Basteupery cada: to emphasias that it retains the riebt to Panty to none. data bits to 8.and stop Puhtse 5 emes of New Hampshes gggggg the timing of dara==issioning bits to 1 (N.8.11. Using ANSI or VT-100 (espec.m ww ene e,eme d me sentmek C

trust fund deposits and withdrawals and terminal emulation, the NRC subsystem

$N.'e's'"[ac"j'c*dl,"sism c7 the liquidity of decommissioning funds can then be accessed by wiectmg the caepereuw temet, e coeweer of the River Send for those hcansees that no longer have

" Rules Manu" option from the 'NRC Piast see PSNH and EFEC connamed ther pm rate regulatory oversight and insofar as Main Menu." Many NRC subsystems

'*"*****"'**'8"***P"*'*8**d such timing would tentially impact and databases also have a " Help /

M$" MEN,[y$"'

the protocuan of pubic health and

!aformation Center" opuon that is rain.

is buanupier.

safety tailored to the particuiar subsystem.

4

)

44078 Federal Register / V:1. 62. ND.160 / Tuesday. August 19. 1997 / Ruhs and R:gulaaens The NRC subsystem on FedWorld can g also bi eccessed by a direct dial telephone number for the main 3

Fed' Vorld BBS. (703) 321-3339, or by usir.3 elnet via Internet: fedworld. gov.

T If ustag (703) 321-3339 to contact

[

FedWorld.the NRC subsystem will be accessed from the mam FedWorld menu I by selecting the " Regulatory.

(

Gove.mment Administration and State Systems." then 6.1.312 " Regulatory Informati n Mail." At that point. a menu will be displayed that has an option *U.S. Nuclear Regulatory Commission." which will take you to 4

the NRC on hne main menu. The NRC i

On.line area also can be accessed directly by typing "/go arc" at a i

FedWorld command line. If you access NRC from FedWorld's main menu.you may return to FedWorld by selecting the

" Return to FedWorld" option from the i

NRC on.line main menu. However. if you access NRC at FedWorld by using i

NRC's toll free number, you will have full access to all NRC systems, but you will not have access to the main FedWorld system.

If you contact FedWorld using Telnet.

you will see the NRC area and menus, including the Rules menu. Although you will be able to download documents and leave messages, you will not be able to wnte comments or upload files (comments). If you contact FedWorld using FTP. all files can be accessed and downloaded but uploads are not allowed; all you will see is a list of files witbout desenpticas (normal Copher look). An index file listmg all files within a subdirectory, with desenptions,is available. Then is a 15 minute time limit for FTP access.

Although FedWorld can also br>

accessed through the Worhl Wide Web, like M. that mode only provides access for downloading files and does not display the NRC Rules menu.

For more information on NRC bulletin boards call Mr. Arthur Doria. Sysiema Integration and Development Branch.

NRC. Washington. DC 20585-0001.

telephone (301) 415-5780; e mail AXD39 arc. gov, Deted at Rockville. Maryland this 13th def of August.1997.

For the Nuclear Regulatory Commission.

Jehe C. Boyle.

l Secroseryofshe Commassen.

IFR Doc. 97-2147s Tiled 6-15-e7: 4:45 aml nues sees vesse.c

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Del Core v. Jackson. No. 3:98cv1011 (RNC) (D. Conn., file June 1,1998) 3 I

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Qn:-l; (s :D 1

UNITED STATES DISTRICT COURT

" M "UA# /

DISTRICT OF CONNECTICUT p

w.~

DONALD W. DEL CORE, SR.,

CIVIL ACTION NO.

Plaintiff l u il q/y, l a

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se v.

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jf W SHIRLEY ANN JACKSON, Personally and in Her Official Capacity As Chairman of the United States Nuclear Regulatory Couunission UNITED STATES NUCLEAR REGULATORY COMMISSION, Defendants

JUNE 1, 1998 COMPLAINT Introduction

1. This is an action for injunctive relief pursuant to 42 U.S.C. 51983 and attorney's fees pursuant to 42 U.S.C.

51988 Cnd under the consoon law of the State of Connecticut against Shirley Ann Jackson, Cimirman, United States Nuclear Regulatory Conunission, and the United States Nuclear Regulatory Conunission.

2.

It is alleged that the Defendants, acting under color of state law, did knowingly, wilfully and wrongfully deprive tha Plaintiff of his rights under the First and Fourteenth Amendments to the Constitution by denying him access to public records.

Jurisdiction 3.

Jurisdiction is based upon 28 U.S.C. $1331 and (1343 cnd on the pendent jurisdiction of this Court to entertain claims crising under state law.

l Parties

.4.

The Plaintiff, Donald W. Del Core, Sr., is a citizen of the United States of America and a resident of the Town of Montville in the State of Connecticut.

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5..The Defendant, Shirley Ann Jackson, is Chairman of the United States Nuclear Regulatory Commission.

6.

The Defendant,' United States Nuclear Regulatory Commission, is an administrative agency created pursuant to

' federal law.

Facts 7.

The Plaintiff is a former employee of the Millstone Station. nuclear generating plant located in Waterford, Connecticut.

8.

The Plaintiff'was terminated from his employment by the owner-operator of Millstone (" Northeast Utilities") on November 8, 1991.

9.

The Plaintiff alleged that he was terminated from employment at Millstone because of his activities as a whistleblower raising concerns about safety issues at the plants ultimately, he reached a settlement with Northeast Utilities as to his alleged wrongful temination on March 12, 1994.

10.

Continuously since such settlement was reached, the Plaintiff has been involved in the gathering and dissemination to the public and to the media of information concerning the operations of Millstone Station.

11.

At all times pertinent to this complaint, the Millstone l

Station, consisting of three nuclear generating plants, has been lat a shutdown mode;because of persistent safety violations.

12.

By order of the NRC, none of the three plants will be l

l allowed to restart.except upon the vote of the four Commissioners of the NRC. -

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4 13.

At all times pertinent to this complaint, the Plaintiff

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has been engaged as a consultant to the Citizens Regulatory Commission (" CRC"), an organization of residents of southeastern Connecticut concerned about the safety of operations of the Millstone Station.

14.

In his individual capacity and in his capacity as consultant to CRC, the Plaintiff has attended numerous public meetings concerning Millstone and analyzed and reviewed virtually all materials pertaining to Millstone which have been made publicly available by the NRC.

15.

At all times pertinent to the complaint, the Plaintiff has frequently aired criticisms in public and to the news media concerning failures of safety systems at Millstone, mismanagement at Millstone, allegations of harassment and retaliation against Millstone employees who raise safety issues, and shortcomings of NRC as a regulator overseeing the operations of Millstone, among many other issues.

i 16.

In addition, at all times pertinent to the complaint, the Plaintiff, in his capacity as consultant to CRC, has provided CRC with information and analysis of' Millstone issues to assist CRC in its role as a citizen participatory group.

17.

On November 14, 1997, Paul Blanch, a highly paid j

consultant working on Millstone issues for Northea.st Utilities, met privately with Defendant Jackson and two other NRC commissioners, Nils Diaz and Edward McGaffigan, in their Rockville, Maryland NRC offices.

3

18. Upon information and belief, Blanch met with the Defendant Jackson and Diaz and McGaffigan, three of the four NRC commissioners whose votes are required for restart, as an cuthorized representative of Northeast utilities to lobby and pressure the NRC to approve restart of Millstone Station.

19. Such ex parte meetings by the Defendant Jackson, Diaz and McGaffigan violate the letter and spirit of 10 C.F.R. 52.780 and violate the public trust in the integrity of the NRC.

20.

At other times both before and after Blanch's meetings with the three NRC commissioners on November 14, 1997, Northeast

(

Utilities executives and managers at the highest levels have met improperly ex parte with Defendant Jackson, Diaz and McGaffigan es well as NRC Commissioner Greta Dieus. On April 1, 1998, both Blanch and Bruce Kenyon, Northeast utilities president and CEO, testified before the Connecticut Department of Public Utility Control that Millstone Unit 3 restart was " imminent and certain."

21.

Following his November 14, 1997 meeting with Defendant Jackson and Commissioners Diaz and McGaffigan, Blanch reported in writing to Northeast Utilities his assessment that Diaz and McGaffigan were prepared to give affirmative votes to approve Millstone restart based on-his meetings with them.

-22 Blanch also reported in writing to Northeast Utilities

-that Defendant Jackson will "be very sensitive to public opinion" l

cs she weighs whether'to approve Millstone restart."

23. ~ Alsoffollowing his November 14, 1997 meeting with Blanch, Diaz told a reporter for The Wall Street Journal that in his meetings' with Blanch, the latter had made "a very good case" for allowing restart.

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2 4'.

Diaz has subsequently. denied making such comment to The Wall Street Journal, according to the Event Inquiry dated May 27, 1998 which was issued by the NRC Office'of Inspector General following an investigation of-Blanch's meetings with the NRC cosmiissioners.

25.

A copy of The Wall Street Journal article so quoting Diaz is-annexed hereto as Exhibit A.

26. -On or about March 12, 1998, the Plaintiff addressed a communication'to Defendant' Jackson concerning The Wall Street

-Journal article and Blanch's meetings with the NRC commissioners, including Defendant Jackson. A copy of such letter is annexed hereto as Exhibit B.

27.

Further on March 12, 1998, the Plaintiff addressed a formal request to Defendant Jackson seeking the release pursuant to the provisions of the Freedom of Information Act ("FOIA") of her records pertaining to her meetings with Blanch and other NRC commissioners' meetings with Blanchs in light of Northeast Utilities' l

recently announced intention to seek a restart vote, the Plaintiff I

. requested that the information be provided "as expeditiously as j

1 possible." A copy of such letter is annexed hereto as Exhibit C.

1 28.- Shortly after May 1, 1998, NRC announced that it would j

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L condoct a final _public briefing on whether NRC should approve Millstone restart on June 2, 1998 at its Rockville; Haryland I

headquarters.

29.. The Defendant Jackson and the Defendant NRC did not h

' timely comply with the Plaintiff's/FOIA request for production l

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S 1

E_________.___________

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of Defendant Jackson's' records of the Blanch meetings, and thereby t!ey acted in violation of the Freedom of information Act.

30.

On or about May 29, 1998, the Defendant Jackson and NRC

' delivered certain documents by mail to the Plaintiff _ pursuant to his F01A request for records of the Blanch meetings.

31.

Certain of the documents so provided contain passages which have been redacted from the originals.

32.

More particularly, the entire meeting summary of the meeting between Defendant Jackson and Blanch which lasted approximately 45 minutes on November 14, 1997, has been redacted from Defendant Jackson's records of the meeting.

33.

Defendant Jackson and Defendant NRC claim they preperly redacted the meeting summary pursuant to exemptions which are applicabic under FOLA, namely, that such information is privileged as a component of the NRC deliberative process that disclosure of the information would result in an invasion of privacy; and that the information is privileged by the attorney-client privilege.

34.

Each of the claimed exemptions does not apply to the 45-minute meeting between Defenant Jackson and Blanch and each claimed exemption, moreover, is completely bogus.

35.

Other records provided to the Plaintiff pursuant to his FOLA request were improperly redacted pursuant to claimed exemptions which do not apply.

36.

Defendant Jackson and Defendant NRC improperly redacted passages and information from Jackson's records without legal cause.

37.

The records sought by the Plaintiff are public records within the meaning of FOlA.

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~38.: Thereby, Defendant ~ Jackson and Defendant NRC, acting l under. color of state law, have unlawfully l deprived the Plaintiff of his. legal entitlement and access to public records and thereby.

deprived him and interfered with his First Amendment and Fourteenth-Amendment rights.

39.

In' conjunction with his activities as a consultant to CRC, CRC engaged the Plaintiff to obtain all available pertinent information concerning the NRC's Operational Safety Team Inspection

-("0STI") conducted at Millstone Station during April 13 - April 24, 1998.

40.

The OSTI inspection and its results are key issues to be considered by NRC prior to a vote on Millstone restarts the OSTl inspection and its results are a specific issue on the agenda of the NRC's scheduled June 2,1998 meeting.

41.

On April 30, 1998, the Plaintiff submitted a request to Defendant Jackson pursuant to FOIA seeking the expedited release of all records pertinent to OSTI and requesting a waiver of fees.

A copy of such letter is annexed hereto as Exhibit D.

42.

The Plaintiff requested said OSTI records so that he could fully inform himself about the OSTI inspection for himself end as a consultant to CRC in time for the NRC last public briefing prior to a vote on Millstone restart.

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43.. On May 1, 1998, the NRC communicated to the Plaintiff 1that NRC would'take'two to four weeks to. comply with his request.

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I "ALcopytof such letter is annexed hereto as Exhibit D r

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On May 18, 1998, NRC communicated to the Plaintiff that it would charge him a fee in the amount of $2,235.02 to comply with his OSTI request, which fee includes copying charges for the 1,400 pages of the documents deemed necessary by NRC to comply with the Plaintiff's FOLA request. A copy of such statement of estimated fees is annexed hereto as Exhibit E, 45.

By letter dated May 18, 1998, the Plaintiff reiterated I

his request for a fee waiver. A copy of such letter is annexed hereto as Exhibit F.

46.

To date, the Plaintiff has received no further response from Defendant Jackson or from Defendant NRC with respect to his OSTI request, notwithstanding that NRC has scheduled its final public briefing on OSTI on June 2, 1998.

47.

Thereby, Defendant Jackson and Defendant NRC have acted under color of state law to deprive the Plaintiff of his ability to participate meaningfully in NRC proceedings concerning Millstone Station as an individual and as a consultant to CRC by unlawfully depriving him of public records.

48.

Thereby, Defendant Jackson and Defendant NRC, acting under color of state law, have deprived the Plaintiff of and i

interfered with his First Amendment and Fourteenth Amendment rights.

49.

The Defendants have acted wilfully with knowledge that j

their deprivation of Plaintiff's access to the requested public records would handicap his ability to air to the public and to the i

news media information concerning the Blanch meetings and the OSTI which would prove to be embarrassing to Defendant Jackson, Defendant NRC, as well as Northeast Utilities and its top management.

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50.

The Defendants have thereby acted in clear abuse of the public trust.

51.

The Plaintiff is without an adequate remedy at law.

COUNT I

51. Paragraphs 1 through 51 are incorporated by reference cs though fully set forth herein.

52. By the above-stated conduct, the Defendants have denied the Plaintiff his rights and liberties under the First Amendment.

COUNT 11 53.

Paragraphs 1 through 51 are incorporated by reference cs though fully set forth herein.

54.

By the above-stated conduct, the Defendants have denied the Plaintiff his right to due process and equal protection of the laws under the Fourteenth Amendment.

COUNT 111 55.

Paragraphs 1 through 51 are incorporated by reference es though fully set forth herein.

56.

By their above-stated conduct, the Defendants have wrongfully interfered with the Plaintiff's contractual rights cnd obligations with the CRC.

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WilEREFORE, the Plaintiff claims the following relief:

1.

An injunction barring the Defendant Shirley Ann Jackson and the Defendant United States Nuclear Regulatory Commission from engaging in conduct in the future to unlawfully deprive him of his right of access to public records.

2.

Attorney's fees; 3.

Costs of this action.

TIIE PLAINTIFF DONALD W. DEL CORE, SR.

By:

uL Nancy ton, Esq.

147 C o s Highway Reddi g Ridge CT 06876 Tel.203-938-3952 Fed. Bar No. 10836 en 6

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Exhibit A "lthe late of Nostheast hangs on which j

'U'htility1ylayers NRC co uamam sudge that Mat ~e I

(

inan regulators believe. If a majorify of I.

Is' ready to rim, at a vote espected in U

V i

forning montha, the resulting revenue k

M'VO ly aials N711050 D. 7 rn hkely will help Northeast avoid a bank-O 7

iv icy ftling or def ault. The s'tutdown. one

(

dlOsed a Nuclear Plant bi -s"'s *-". has so far

~ * "

• U.S. nuclear-sewer industry 4

cost Northeast $1.2 blition, cut its share o

a

'f C, +Ome 10 Ollier Iyailing pnce in hait, wiped out its dividend. and

,I J

weakened the company as the New Eng-C, land region it serves moves rapidly toward M

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$ opening of Fac,lity Hangs otiiity deregulation. : "m i

M The Nnd acted against M111slone after On Which One of Them Ceorge caiapsp)$ Blanch had helped engineer whom Mr.

=. Regulators

• "' 'f s ; 7 Side With

!q gpersuade to come g

,o forward, exposed 7.j D oe Ihow Northeast was

' dave We Hired the Enemyi.

averionding a cooi.

e Ing reservoir'with

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highly ' radioactive T

(d By Ross Kranra j

fuel rods to save 3

time and money.

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l sjyf An.we of Tu wau.smn Jouwu.

'h That problem and

• ? W ATERFORD. Conn. - Af ter Paul as others led to a rec-

,,$lanch quit his engineering job at North-

' ord $2.1 ml&n line o>

F"" M f

N: east Utilities, he drove to the imme of

~

from the NRC last k

c,I "Ninald Del Core Sr., a technician whom

.he company had fired.

k,,,

December.

The C'

y' 2 J2 *1 needed some consoling /* recalls Mr.

arold Del Cbre Sr. Connectic.,utU.S.

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P7 J

U 8Qlanch.'who says managers harassed him d

./ a d repeatedlystgnored his safety warn-

!!so investigaung whether Northeast man-i g,aboutithe: company's Milhtone nit-6gers tied atmut their safety practices.

d S

I

,d ; tear powet plant in this small Connecticut

Mr. Del Core contends that Northeast

^

,I dwn$1 was pretty.down. I'd just given UP ill!! hasn't solved a myriad of other serious ej g

g y

lhdtT-year;careet." ' '

safety problems. Ile says training oa Q

JT The.two friends, both strapping Navy safely procedures is shoddy. and he cites v

yterans. drank coff ee and reassured each iecent NRC findirigs tint the utilitystill

[

5

' pther for hours. On Desn't know whether thousands of pipes, g

D ylhat day five years d, k[7 L -

numps and wires would perform properly

' y,*d ;

kthe event et an accident. h1 February, Q

Z

} bro, they made an

g.i ; $j $

Nllrtheast reported that a valve cnntro!!Ing di

• unspoken pact to b

i y

klick together, and jhe flow of conlant through one of Mill-

.[ heir ' ' warnings Q'Q[

sWne's three reactors might jam during an cm by the U.S. Nuclear (qh,)y.d,

' )) cut Mllistone ehlergency..

O 3

4 Northeast executives acknowledge the were finally heeded i

,'/>

(echnical problems but any that most of r

9

,ytegulatory Com-1l them can be aately addressed after the ission, which has L

(trit of the reactors begins to run. They sa y i

a tecent management shake up of Mili-orced Nortneast to p,/

'.K' A.h

.. Mllistone. r /

/y I

it6ne's training departmeni should altav s

jd.krep Mt. Del Core's concerns regarding tratri-

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h@het sed since March

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Pout Bimsch

\\,ng/Mr. Blanch says that most of these 5

+

'.. Vindicated. - in l

Ibthe past as allies. the two men today are-frbblems are minor and shouldn't bar a i

t-

... barely' speaking as thelt, path!( veer in testart because "you have got to be real, bpposite directions. Mr.'.thitore. lWI years von can't assure compilance with IMrr of

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ga

d. remains an unrelenfirig crtik of the liif regulathms all the time." The NitC

""T" g

t aht, ralling against its managers, dig-Appears to agree; William D. Trnvers, who O g up.ev6dence against it, and taking heads the agency's Millstone inspection jj, g

Jnedication to control his temper and hkod leim says most of the etpilpment uncer-

[tpressure. Mr. Blanch. 55. 6s back at North-g h.

t talndes aren't safety significant/

l8esst'Utl}ltles, rehlred in the role of om-

.* Mr. Del Core also says employees wlm udsmani arguing that the Berlini Conn.,

raise safety cpncerns are still being har-hower company has changed its ways and isked by Northeast. lle obtahed and made Imblic a Jan; 11 menm approved by Dave

~

f F flease Marn to Thor AM. Oihrms t I Core s outraged. Calling Mr.

1. p k',

nch ya seilout.*i he alleges that his

k. tNittime eclieague is engaged in a conflict

. of interest - assigned to ensure that em-ak playees' concerns about selety are heeded )

i Whileatthesameymg

{ng(egulators a

Int the samd l

[.jfoyerlook'theni.\\ lie 7else theres and I

y,line ks eve

%lha

'Inc off 'tiMr7DelChre saysr.;lt d".".2 A h Blanch seesit.'Mrs DelCore has',

become irrational and obsessed with Millt '

stone, a rabblercur.er who "doesn't under-.-

. stand that at some point, you have to stop h.Itting them over the head with an ta and

. sit down and talk.

state his utary, hnt says he carns me e

'i:

shan he and as nn enginecting supersisar.

A10 ATilE WALL STitEIN JOUltN AI, TilUltSDAY. M AltCli 12.19M Mr. Delrnte Insists Hint H was ha whn first enne up with the iden of an ombwls-T.

.P@alsSp'litOveraPowerPlant

"W"=";l='tN"""10 vo

g. 8gd 1 v @@ t

• "d hi"" "U " M'

• W'"'" 'U*

• resents that Mr. Hlanch "Innk all my ideas

.i 8 $amtinited1%m nrs!IMue

, h' s. bel.lvice president. for'auclear over.

4 Still at Northeast at the time, Mr.

believed an ombudsman post w'onid fly at N[ sight aCNortheast ' that' criticized plant.

nanagers for,theirYlinablHty to" Isolate Blanch says his supervisors were intimi.

Northeast unul Mr. Kenyon mentioned it t

dating him. Culleagues'would f all sHent to him.

! rynics from groupcultureP' After the NRC when he entered a room; he says. Supe-Mr. Del Core says Mr. Blanch has thasUsed Artheast er the merno, the riors audited authoritauons he made for become a company apoleelst amf dis-jompany annouriced hire Goebel had employn expenses, an setion the NRC misses his hiring as a publiMelations

' resigned.irlltilfmutual.sdeelsl.en." Mr.

' later found to be harassment. Mr. Blanch move, which Mr. Kenyon disputes. l was quit his $78.00&ajear job in 1993 and looking for someinsdy who could help me sayin 1'

lestj w a

> received an undisclosed setuement He fis Millstone. sho could give me perspec-i i ' cent %y the.referenci to eynks;M1972. hisunched' a 8llghungtonsulting business tive." he says.

Ni ift Mrh Blanchijoindd '< Northeast ll

' and remained friends with Mr. Del Core.

tilting the Enemy?

" l hortly kiter'gleaving.the Navy's. nuclear.

The two men and their wives would go out Mr. Blanch aays he loves his new j(M.

[ submarine'seryled'and earning an engl.

for Wnm food. Wn Mr. Mm s wW l [ peering degree. The htluty put him to work lie says he helps atxmt seven employees a U"

"I month settle their differences with ruan-pverseeing the design of electrical systems 9

Mr. ' Blanch s wife had surgery. "I used toagers. lie takes credit for the rehhIng of i during the construction of Mllistone's sec-l

. t,ondareactorAlie!became known for his half a dozen employees ahn were f ald off in I i thorough understanding' of the plant's in-f,

","y' saw rny own famuy.

January 1996 for what Mr. Blanch de-

hermorkings and his insistence that,every i. 'The two men talked of reforming their scribes as retalla00n for their outspoken-ness. "No one would touch ns before l'nul g i system work exacity es designed.

former ernployer. They testifled at public

,1 l?lnsthe lat(llB80s,Ihowever. Northeast Hland W up says one W th retur

, p'tsegan alecompan ide' cost <uttlng effort hear.ings and helped found a group called nees. @nect Hany S.

anL gg 'Cluzens Regulatory CDrnmission." to that *Mr.t flianch fewed. As a threat to

lle lends us a lot of credibility." savs P",fcMsa]d jealetydn1988.M to monitor reactor pres-s a

witham it. Carr, a Minstone cor tracts Blanch dtscovered that

, sensors designed homemakers who lived near MHistone-manam NMn tw Hrst got hm.,{ used

.sure andd,falldrlthout warning. He later to think. have we hired the enemy?

I ifound'that gauges 8used to measure the pw to 1 cate and interpret NRC records.

Mr. filanch has been leiling local news-it was because of Ulanch and Del Core a level of cooling { water inside'Mtilstone's papers that Millstone shonid be reopened input that we kept askingquesHons, says L { oldest reactor could be' inaccurate by as D'*" $.'.ry 1.ust n. an @rnentsyschool NRC othclats. Inchuling Novernher ses-and has met several tirnes privately wHh much as 311ett.' meaning the radioactive

[ fluel core could bd exposed and begin to sions wlui agency thatrwoman Shlriey d n't know s ual'.

4mtlldown petore operators realited water Jackson and commissioners pits Diat and lfvels.had.dttppedklie says managers A !!!g Phone Tab IMward McCalligan.f r. at NHC headquar.

lrebulled his'dem4nd for fixes in the first Mr. Del Cbre relishes his role as an ters outside Washington. Mr. Illanch says

..fcaseBIntthelsecond! case. Mr. Blanch activist, taxing documents far and wide, he isn't lobbytng the NftC to reopan the

' '{conflnced Northeastito replace its own dishing tips to the media and running up plant because he belicves that would he a 4 gauges but inetlwith resistance when he St 000 annual phone bills. Friends say it's conflict of interest for hien. Nonetheless, draised the issue with the owners of 36 other not unusual for him to ignore dinner guests Dr. Diaz says that in his ineetmgs with Mr.

MU.S.'reactorf that had.the same problem. whHe he confers on the teltphone with Blanch, the ombudstnan has mafie ":e y Mr. Blanch eventually began to discuss his reporters and state othclats about Mill-pretty good case" for allowing a restarI.

, jcxmcerns with NRC officials, who deter-stone. A study in his house in Uncasville.

mined pe,was right in both csses.'

Conn., rivals the NRC's nearby pubhe-dot-Webus Mr@

rI Dutipoken'Maverickp j P ' qF uments room. Maura Casey, an editorial outside N rtheast. Other nld frientis

'l btei5Esi"NsNr"fNhE"eToDr' a$d a cElheiUUy5 NINO' 5

' n Nf5'nNbbbb'3 fcbb f,,,,

P n

I' I] known around Muistone sa an outspoken ' ' Dut Mr. Ulsnch was frustrated by his targets of the (f.S. Attorney's criminni lg maverick whoIwas'also critical of the WHpuo Mr. GakHL wW nIh rost cuttlng! IhhlIP ri '

estrangement from decision rnakers. My t, $ in* time )h!r Del) Core and' his c [ thole career has b,een about making tiu-

((f.

EI((

o leagues > began \\ flooding the WRC'with clear power work, he says. After his such infortnat on would allow Northeast to

'I safety and snariagerial concerns -. at least resignation, he stayed in touch with old 130.in 19119 alone.iThe tilegadons tariged frientts at Northeast and the NItC. at times

,[

npj h^. N o

ann i* "

, imm.faUure to, test a radiation alarm to {n ms{Jf forward as a candi-about the pirme enH. Atr. Blanch wrote 5 g matters unrelated,to safetye such as im-prUper/conticOof Sovernme costs. The commissioner.*

the agency to apologize and said that be d[

agency eventually found some justification l. When Northeast hired a new nuclear-had misimderstet a request from a supe-for!H;of the' complaints, although none operations: chief in August 1996. Mr.

tlor as asking him to contact Mr. Galatis for the InformaDon. The NRC sars it is

. pere,determinedito ignificant aalety. liianch found a way back. The new chief, NtJndeterred.M}

}1;I y y N Q.'

.Ilruce D. Kenyon. temembered Mr. Blanch sausHN with Mr. Blanch's resIionse' i

violadonsf,y l when both men worked at Millstone in the Mr. Def Core is deshng wl01 problems I

learly 1970s, and offered him the newlyof hin own regarding the hnpression he e continued his ;

carnpsignJ ln Wovemberl1991. - Northeast fired hirl Del Core.'an ' etton the company (created job of ombudsman, designed to makes. In February. he drove seven Imurs t

to a MlHstone hearing at NitC headquar.

l -Illll'dttllnd to discussille tumed to thel help resolve internal and external com.

.ters. Although the meet ng centered on the

().SJ1 Abor $ Department) which investi-plaints. !;

"heh

{ gated knd lobnd s'smpany document that :Maldng a Deal he r

Cor N

n and M hWunWesHMonnecueMa a to itc1

he was outside the company, and I thoug ht, Rep. Terry Conrannon, also a ~ctluc of Core'%om.i ill141$th W u M & ;that was a satt state of aflalts.*' Mr.

Northeast, says Mr. Del Cnte's bhmt styte Departsnent s ed in favor of Mr. Del n Jays

. an acce W W mneune runus in his being disred i

y uncerns?Thehfsetti.

trals

1. findin l

flit gotiate fler, despite objections from Mr. Del Core garded, and drowns out his otherwise vati t and ther Martheast critks. lle declines to cr!Uctsms. "Ilts intensity overwichns tment he e much.$lse4!s 6 With to subsl him, she says.

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8608482020 OPBIT Ild Ps.GE 07 p

m Exhibit B

' Donald.W.' Del Core. Sr.

4 Driscoll Drive.

Uncasville, CT. 06382.I80s

' Dr. Shirley Ann Jackson Chaimian -

. U.. S. Nuclear Regulatory Commission s Washingtori. D. CJ20355-000I c'

March 12,1998 FACSiM1.E

Dear DiCackson:

I write to you today regarding an article which appeared in today's Wall Street

, Journal.' Apparently. Mr. Paul Blanch. a emTent NU estployec. or consultant. has met "severaftinks" with the NRC Conunissioners luchiding yourself, abont Millstone Station.

While MrJBlanch denies lobbying for a restart, on behalf of Northeast Utilities ( NU j beforeihe: Commission. the quoted comments by Commissioner Diaz in that article, seem to suppm that lobbying, did take place.11as the Commission had lobbying efforts by NU.

or it's chnaultants. to make a case for the restart ufany Millstone unit? Does a transcript, l

or taped rdcord.. cxist of those meetings? Ilow can'a utility representative have personal,

]

or private'; access to you, and your fellow CommissiorWrs, to " make a pretty good case -

for allowing a restart?.

(The public has not been allowed that kind of access. We in fact. have been severely restricted from public questioning. and commenting by NRC otlicials, at all p' blic meetings with your staff, and very few questions, and comments. were allowed u

~ during four visits to Millstone. I believe the practice'of allowing NU representatives that much access, while limiting public access is an unacceptable practice. I also.bclieve it to be illegal and a conflict ofinterest. Furthermore, allocation of equal time should be allotted to those of us that wish to proffer our case to (Ire Commission.

iWas Mr. Blanch acting as a company representative or as a private citizen? In either clipacity, he was afforded much more access' tha'n'others. und that access appears to

)

C be a lobbying efibrt by him. NU, or both Please maki: available to the public all NRC l

records' associated with the meetmgs, Additionally,: public access must be improved at j

public rneetings. We continue to be restricted, with regard to the number of questions we l

allowed to ask. and the subject matter of the questionsR Your staff constantly indicates to us, that they are receising complaints from individuals that they cannot ask questions at l

the meetingst because a few people are asking all the questkms. The same individuals ask.

l questEnriat every meeting, with one exception, the11eader of the newly formed group

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I Friends of a. Safe Millstone ( FOSM.). In the last few tnectings he has begun to make conunents, and has complained to your statiabout tWmeeting format. Your staff e

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e60eac2020 0Fsrr ire pu3e og 05/31/1998.21:34 immediskely changed a fonnat they had established through trial and error, over many

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meeting ( to accommodate the newcomers.

. Ilw.. meetings cover too much intbrmation. Thst;is to say, we are given a review of the IdAVP, the IICP, and an update on the restart progress, On most evenings. we receive 4xtra presentations by.the licensee. and third party contractors. All of tbc informationis.important, and necessary. especially for1 hose that do not attend the daily meetings. We have pointed out many times to your sti1T, that too much is covered in one eveningdand that tlw update mectings need to be spread over a few evenings. It has fallen on deaf hars! 'The public will not be satisfied with the pfesent system, nor should they be.

If the ptiblic meetings are necessary to solicit public opinion, and input on it's perception of the situation, and progress at Millstone. dien the mee)ings are not accomplishing their goal. Your attention is needed to move your stafTon this isstle.

iAs with my previous letters to you, I have provided the Office ofInspector General [with a copy of this letter. Thank you in advance for your prompt attention to these issues so very importam to the public.

Sincerely.

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ona d W. Del Core, Sr.

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I le 05/31/1999 21:24 8608487020 OPBIT IHC PME 05

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Exhibit C l

Donald W. Del Core, Sr.

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Dr. Shir&ey Ann Jackson Cnairrnan.c U. ' S. Nuclear Regulatory Conunission Washindton, D. C,20555-0001 March 13.1998 FACSIMLE e

Dear Dr. Jackson:

With regard to my letter of March 12,1998,I would like to ibrnnlly request the release of allinformation, including personal notes, inter-office memos, tapes, computer recordsjahd other documentation asociated with the visit visits ofMr. Paul Blanch with

/

you, and other Commissioners. In the Wall Street Journal article referred to in yesterdays' letter, there was also an indication that Mr,. Blanch met with other NRC officialsr and theretbre, this request includes a requestfor the release of the information related to those visits.

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> }This request is made to you. under the provisions of the Freedom ofInformation Act ( FOIA ), in view of the fact the Nodheast Utilities hasjust recently revealed it's intentioh to request a scstart vote. I would expect that this inf a nation be provided as expeditiously as possible. Again,1 thank you in advance for your prompt attention in this important public matter.

Sincerely, m

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4'Drischlt Drive Uncanyille, CT. 06382-1808-Dr. Shirley Ann Jackson

" Chairman

'U. S. Nuclear Regulatory Commission Washington. D. C. 20555-0001

-]1 April 30.1998 v

FACSIMLE

Dear Dr. ' Jackson:

IWith regard to the Operational Safety 'l eam inspection ( OS11 ) conducted between April 13,1998, and April 24,1998, I wouldJike to formally request the release

. of all information, including Team observation reports,. minutes of team meetings, and other jeain shared information. Additionally, please pr' ovide copics ofIeam shared personal notes, inter office memos, tapes, computer $ecords, and other documentation

. associat' d with the visit / visits of all team members, a~nd others associated with the team.

e

'1 would[elso like any information utiliud by NRC management at the Millstone site. or in the Region l' office. Also please provide all team shmbd information utilized by the NRC team ist IN preliminary exit rneeting with Millstone management.

iThis reques' t is made to you, under the provisions of the Freedom orinfbrmation Act ( F01A ); In view of the fact the Northeast Utilities hasjust recently revealed it's intentloh to request a restart vote. I wouki expect that Unis infonnation be provided as expeditiously as possible. This inibrmation will le utilized to inform and educate the public on thesd important restan issues, and therefore should be exempt from any fees. It is imporilaht:that this infomtation be addressed as.soon as possible to prevent the loss of imponnat public disclosure. Again.1 tlumk you in adyance for your prompt attention in this important public matter.

Sincer lyl,

mafd W. Del Core, Sr.

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• 9/c : Mr. George Mulley. OJO 2

Ms. Susan Perry Ltaton, CRC o

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UNITED STATES *

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NUCLEAR REGULATORY COMMISSION

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May 1.1998 FOIA/PA 88-186 i

Mr. Donald W. Del Core 4 Driscoll Drive UncasviUe;lC3 06382-1808

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' De$fR$duksieh We received your Freedom of information Act/ Privacy.Act (FOlA/PA) request on 4-30-98.

Your request has been assigned the following reference number that you should use in any future communications with us about your request FOIA/PA 98-186.

Based on your,desenption of the records you are seeking,.we estimate completion of your request willlake 10-20 workdays (2-4 weeks). We will advise you of any change in the

'3 estimated time 40 complete your request.

For purposes of assessing fees in accordance with our regulations (10 CFR 9.33), we have placed yoishequest in the folicwing category: Non-Excepted, if applicable) you will be chargr-d appropnate f,ees for Search and Duplication of records.

A sheet has been enclosed that explains in detail the fee charges that may be applicable.

Please do not submit any payment unless we notify you to do so.

You' requested.that fees be waived for your request and I have determined that your request for a fee waNeridoes not provide sufficient information under10 CFR 9.-i1 fx the NRC to make a determinatich.to ' aive fees. A copy of the factors which must be addressed is enclosed w

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The following person is the FOIA/PA Officer who has beeh assigned responsibility for yo l

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If you have du'estions on any matters conceming your FO!A/PA request please fe l

. contact the assigned FOIA/PA Officer or me (301-416-71891.

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ssell A:' owel FOIA/ Privacy Act Officer

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Incoming Rdquest Explanationjof Fees Fse Waiver Justification Requirements

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NRC FORM see

u. s. NUCt. EAR REGULATORY 40MMISSION REQUEST NUMBER

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APPROVED eY OW8 mdWJ FOIA-9iM%

1 b....f] 'NREEDOM OF INFORMATION ACT.[FOIA) REQ STATEMENT OF ESTIMATED FEES FOR DATE

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' Pursuant to the NRC'h regu.lations,10 CFR 9AO,52 FR 49350, the NRC noUfies a requester when es

$25.00 cr a ilmit stated in an FOlA request. The estimated fees for processing your FOIA request are noted below. If you wish to r% scope your request:to: reduce fees, you may telephone;the NRC cantact identified above to discuss re-scoping the request.

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othenMee, please. provide.a wntten response on required action noted below, if the NRC does no; recorve notice from you on re. scoping your rogueist'or be required written response wrthirt 20 days from the date of this notice. the NRC will presum

. h:ve to further interest in NRC processing your request and will close the file on your request.

ESTIMATED FFFA :

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• Duplication estimeteils'hased on the assumption that'you want copics;of disclosed records malled directly to you if you prefer.

the NRC will rnake disclosed records available et the NRC Public Document Room, Washington, D C, or at a Local Public Document Room for usp' ection free of charge and copying at fees charge:1 et those locetions. Please note your preference in the hsporco section below Please note the comments provided on the attached NRC Form 50s,A.

For fee purposes,.the NRC has aggregated the muttlple requests idenMed above under the presumption that the requested records could have beerl the subject of a single request.

Ycur request for a waiver or reduction of fees doer not provide sufficisnt Information under 10 CFR 9A1 for the NRC to make e delirrninetion.lo' waive or reduce fees. If you want the NRC tri considerihn matter further, please submit a written reauest pursuant to 10 CFR 9A1 within 10 working days from the receipt of this trotice.

REQUIRED ACTION -

Please agree in Oriting to pay fees as high as estimated by signing and dating the Response section of this form and returning the form to the NRC contact identalied above at the U.S. Nucionr Regulatory Commission. Washington, D.C., 20$55-0001, whhin 20 days frorn the date of this notice Please provide an advance payment of the estimated fees by submitting a check mada payable to the U.S. Nuclear Regulatory

~

Commtssion'.wlthiri201omys from the date of this nouce.' Mall tho' cheek te the NRC contact identified above, U.S. Nuclear Reguttery Comspiselon, Washington, DC 20555-0001. Any overpayment of fees will be refunded to you soo e tcNtr.thtom*PORemAHen DATE 11

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RESPONSE

4 required abovee l spree to pay fees as high as estimated, or enclose advance payment. 'I agree to pay estimated search fees wen if th) NRC conducts an.' unsuccessful search for responstve socords' or determines records located are exempt from disclosure.

prefer that copies of disclosed records be provided as stated below.

MAILED. TOME BY.THE

' PLACED IN THE NRC PLACED IN THE LOCAL FOIA4.PDft BRANCH

' PUeUC DOCUMENT stCOM PUBUC OccuMENT ROOM

.i samarume-rom meouesteR3 DATE "c * "" t**35 W."M 'K",t/.MhS"8 3..'."*LtC '3?/,1^fJ?.irdt2S".f.HS.L..i.". 3f.

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Dear Sir / Madam:

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.. n 4ttached please find a copy lof rny. original letterto Chainrre Jackson requesting documenisN'speisted 'with a recent' inspection condisted by the N!!d staff under the FOIAQso'please find the response bpyour Ms. Natalii O. Brown. Apparently. the request fipt a wt.ver of fees was not clear enough, thArefdre please allow me to jirovide the neceabary information to support my request.

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t. cv Fif yT.,he sh$ciided use of the requested infonnationis to provide the general public with the.resskifo, f,tlie Operational Safety Team luspectidn, iidiuding the areas reviewed. the findingsMfibe itembers of theiTeam, and.a'more irsiepth review than what was provided

. In the exli inetting." As you may be awaar the public exit *rueeting was conducted during the daytirbe; working hours for most individualscpreventing them from receiving the information 6n the resuhs of this very imIxirtant inspection.

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,61 have more than 30 years experience in the nuclear business, about half of which is associate $ith nuclear power generating ~ facilities undershe jurisdiction of the NRC. In n'dditidni halc' spent the last 10 years reviewing.NRC records and reports adociated with 4

the MillethkStstion reactors.0 I was 'hhployed at Millsisne Station fo'r more than 12 e

years [sisUdieel more than qualifkd to review such documents and convey their meaning to the public, ailfdarea of the plantas 4:

. NThtilic wih be informed of the linfomstion thiough public access television,

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.which.in dnirently distributed to approximately 15 3ocaldecess channels throughout the '

State 6f@sgulatory Commission, abd us such provide.my services on a danecticut', dixi on Long Island; N.Y. il aEsin technical advisor to the Cithindt

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'sind no.fmespr payments are paid to me, nor are there any charges to the public ci to any

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acoces4hbeneis showing the videos praA-1 at thci hos(channel. Neither 1. nor the ('RC

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havir iiay)mtvane or commercial interest,in tbc htforminRiphfeguested.~ Other public groups i

~ receivingitlis binefit of the public'infopnation~pJovided%"myself and.the CRC an:

The Ch,ispnsiAwareness Network,' Don't Waste C. onnesiiout, and the Green Party.

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t The CRC is a grassroots neighborimod group formed in.1995 as a result ofpmblems at

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the M111 stone Station. : Our nwmbership is 300+ citizens from many town surroundin Millstone-Plants, and from cities as thr as 50 miles awev.

.. I requested a waiver of fees in my original letter and I am well known to the NRC staff, and Commissioners. I generally correspond with the Chairman. and the other 3 r

' Commissioners alx>ut every other week on issues related to Millstone on behalfofthe gerwrul public. I resent very much the delays your efairhave caused in getting tir requested information. A previous FOIA has yet to be fWfilled. I would like any future FO! A' requests to be acted upon based on the usage information in this letter. 'lhard: y for.yowiprompt attention in this matter so important to public disclosure regarding their health a6d safety.

Sincerelyg 6

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',I F.A.C.T.S. (For a Clean Tonawanda Site). I'nc. v. NRC. No. 98-0354E(H) (W.D.N.'Y., filed

- June 2,1998)-

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I IN THE UNITED STATES DISTRICT COURT i

FOR THE WESTERN DISTRICT OF NEW YORK F.A.C.T.S. (FOR A CLEAN TONAWANDA SITE), INC.,

Plaintiff, vs.

No:

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UNITED STATES NUCLEAR REGULATORY COMMISSION, CARL J. PAPERIELLO, in his capacity as Director of the Office of Nuclear Material Safety and Safeguards, UNITED STATES DEPARTMENT OF ENERGY, JAMES M. FIORE,in his capacity as Deputy Assistant Secretary for Environmental Restoration, UNITED STATES ARMY CORPS OF ENGINEERS, DR. JOHN H. ZIRSCHKY, in his capacity as Acting Secretary of the Army (Civil Works), LT. COL. MICHAEL J. CONRAD, JR.,

in his capacity as District Manager of the Buffalo District of the Army Corps of Engineers.

Defendants.

COMPLAINT FOR DECLARATORY AND INJUNCTIVE RELIEF

^

I. INTRODUCTION

1. This is an action for declaratory and injunctive relief brought under the Administrative Procedure Act ("APA"),5 U.S.C. gg 701-706, the Declaratory Judgments Act ("DJA"),28 U.S.C. gg 2201 and 2202, Fed. R. Civ. P. Rule 57, the Atomic Energy Act of 1954 ("AEA"),42 U.S.C. gg 2011 et seq., as amended by the Uranium Mill k

Tailings Radiation Control Act ("UMTRCA"), P.L.95-604, 92 Stat. 3021, and the National Environmental Policy Act ("NEPA"),42 U.S.C. g 4321 et seq., as amended.

2. This action is brought for the purpose of determining a question of actual controversy ' etween the parties as hereinafter more fully appears, and for the purpose of o

obtaining an injunction against the defendant, United States Army Corps of Engineers

("USACE"), enjoining it from proceeding with the cleanup of the FUSRAP Tonawanda Site (hereinafter described) pursuant to the Final Record ofDecisionfor the Ashland 1 (including Seaway Area D) and Ashland 2 Sites, April 1998 (" ROD") issued on or about April 20,1998, and from performing " interim actions" at the Linde property (hereinafter described).

3. Plaintiff seeks declaratory and injunctive relief, and an award of costs including reasonable attorney's fees and expert witness fees.

II. JURISDICTION AND VENUE

4. Jurisdiction is based upon 28 U.S.C.

1331, the APA,5 U.S.C. g 702, the AEA, 42 U.S.C. gg 2011 et seq., as amended by the UMTRCA, P.L.95-604,92 Stat. 3021, and NEPA,42 U.S.C. g 4321 et seq., as amended.

5. Venue is appropriate in the Western District of New York pursuant to 5 U.S.C. g 703 and 28 U.S.C. { 1391.

III. PARTIES

6. Plaintiff, F.A.C.T.S. (For a Clean Tonawanda Site), Inc. (F.A.C.T.S.), sues on behalf of both itself and its members.

F.A.C.T.S. is a not-for-profit corporation organized under the laws of the State of New York, with its principle place of business 2

in the Town of Tonawanda, New York. F.A.C.T.S. is a membership organization, rnost

]

(

of the members of which live in or near the Town of Tonawanda, New York, the specific area involved in this dispute. F.A.C.T.S. is dedicated to open government and to the safe and proper cleanup of radioactive waste in Tonawanda, New York. To this end, F.A.C.T.S. engages in activities designed to increase the public's awareness of-government activities relative to properties contaminated with radioactive wastes.

F.A.C.T.S. is also a government-recognized stakeholder in the environmental review process relative to the remediation of the Formerly Utilized Sites Remedial Action Program (FUSRAP) Site in Tonawanda, New York (hereinafter described). F.A.C.T.S.

seeks to achieve a safe and proper cleanup of radioactive wastes in Tonawanda, New York, by inter alia, taking action on behalf ofitself and its members to ensure that state

)

and federal officials fulfill their statutory mandate to protect public health and the i

environment and to ensure the safe management of radioactive wastes. Plaintiff's 1

members have contributed financially to it in part so that they may obtain adequate representation of their legally protected interests, which representation they could not otherwise individually afford. Each of the nembers of F.A.C.T.S. has a personal interest in the safe and proper cleanup of radioactive wastes in Tonawanda, New York.

7. Members of F.A.C.T.S. live in or near the Town of Tonawanda, New York, in the vicinity of, or own property or recreate near the properties comprising the FUSRAP Tonawanda : Site, which is contaminated with radioactive wastes. The health, recreational, economic, aesthetic, and environmental interests of F.A.C.T.S. members have been, are being, and will be adversely affected by defendants' acts or omissions as c

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3 i

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described herein. Their health and the quality of their environment will be impaired by the release of r,adon gas and other radioactive hazards from radioactive wastes 1

improperly remediated by the defendants. The FUSRAP Tonawanda Site exists in close proximity to areas frequented by residents Western New York and/or the Town of Tonawanda, including F.A.C.T.S. members. Members of F.A.C.T.S. are limited in the use they may safely make of public spaces in close proximity to the FUSRAP Tonawanda Site, and their use and enjoyment of their residential communities is impaired by the presence of radioactive contamination, and will continue to be impaired by improperly remediated radioactive contamination, at the FUSRAP Tonawanda Site. ' Members of F.A.C.T.S. are required to breathe the air of the State of New York within the Town of Tonawanda in the vicinity of the FUSRAP Tonawanda Site. They are aggrieved and adversely affected by the discharge of radon gas into the air, and by the release and/or threatened release of other radioactive constituents, and will continue to be adversely affected by such discharges and releases and/or threatened releases if the requested reliefis withheld.

8. Don Finch is a member of F.A.C.T.S. who resides at 208 School Street, Kenmore, New York. Mr. Finch resides, works and recreates near the properties comprising the FUSRAP Tonawanda Site.

9. Ralph Krieger is a member of F.A.C.T.S. who resides at 263 Exchange Street, Alden, New York. Mr. Krieger works for Praxair, Inc., at 175 East Park, Tonawanda, New York, on what is referred to as the Linde property of the FUSRAP Tonawanda Site.

4

10. Mark Rood is a member of F.A.C.T.S. who resides at 826 Englewood Avenue, Tonawanda, New York. Mr. Rood is a former employee of the Linde Division of Union Carbide who worked for thirty (30) years at the Linde property of the FUSRAP Tonawanda Site.

Mr. Rood presently resides and recreates near the properties comprising the FUSRAP Tonawanda Site.

I1. Thomas Leary is a member of F.A.C.T.S. who resides at 108 Wendel Avenue, Tonawanda, New York. Mr. Leary currently works for Praxair, Inc., at 175 East Park, Tonawanda, New York, on what is referred to as the Linde property of the FUSRAP Tonawanda Site, and he has worked on the property for twenty-five (25) years. He has relatives and friends who reside within one quarter (1/4) mile from the Site whom he frequently visits.

12. Horst Nitzer is a member of F.A.C.T.S. and is the owner of Nitzer Machine Corpc, ration, which is located at 230 Firetower Drive, Tonawanda, New York, less than one quarter (1/4) mile from the FUSRAP Tonawanda Site. Nitzer Machine Corporation employs twenty (20) individuals at 230 Firetower Drive.

13. Thomas Schafer is member of F.A.C.T.S. who resides at 122 Orchard Drive, Tonawanda, New York. Mr. Schafer resides, works and recreates near the properties comprising the FUSRAP Tonawanda Site.

14. William M. Watson is a member of F.A.C.T.S. who resides at 771 Fletcher Drive, Tonawanda, New York. Mr. Watson resides less than one mile from the contaminated properties. He is an avid birdwatcher and frequents areas adjacent to the Site in pursuit of his hobby.

5

15. Dorothy M. Watson is a member of F.A.C.T.S. who resides at 771 Fletcher Drive, Tonawanda, New York. Mrs. Watson resides with her husband less than one mile from the FUSRAP Tonawanda Site.

16.The interests of the Plaintiff and its members who are residents of the area involved in this dispute are within the zone ofinterests intended to be protected by the statutes upon which this action is based, namely, the AEA, as amended by the UMTRCA, and NEPA.

17. Defendant, UNITED STATES NUCLEAR REGULATORY COMMISSION

("NRC"), is an agency of the United State.s organized and existing under gg 5801 et seg.

of Title 42 of the United States Code,42 U.S.C. gg 5801 et seg.

18. Pursuant to Section 84 of the AEA, as amended,42 U.S.C.

2114, defendant, NRC, is responsible for the management of byproduct material as defined in Section 11(e)(2) of the AEA, as amended,42 U.S.C. g 2014(e)(2).

19. Upon information and belief, defendant, CARL J. PAPERIELLO, is the director of the Office of Nuclear Material Safety and Safeguards ("NMSS"), NRC. He is responsible for the remediation of, inter alia,11(c)(2) byproduct material through implementation of NRC's Site Decommissioning Management Plan ("SDMP").

- 20. Defendant, UNITED STATES DEPARTMENT OF ENERGY (" DOE"), is an agency of the United States organized and existing under gg 7101 et seg. of Title 42 of the United States Code,42 U.S.C. gg 7101 et seg.

l

21. Defendant, DOE, has claimed jurisdiction over, and/or ownership of, the 11(c)(2) byproduct material at the Tonawanda FUSPAP Site.

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22. Until October,1997, DOE claimed responsibility for the cleanup of the FUSRAP l

Tonawanda Site. In 1988, DOE issued a Notice offntent to prepare an Environmental Impact Statement ("EIS") with respect the remediation of the FUSRAP Tonawanda Site.

In 1993, DOE issued a combined draft EIS and Remedial Investigation and Feasibility Study ("RI/FS") with respect to the remediation of the FUSRAP Tonawanda Site.

Thereafter, DOE failed to issue a Final EIS and suspended the NEPA environmental l

l review process at the FUSRAP Tonawanda Site, deciding instead to proceed exclusively j

under CERCLA.

23. Upon information and belief, defendant, JAMES M. FIORE, is Deputy Assistant Secretary for Environmental Restoration, DOE.

He was responsible for the implementation of FUSRAP while the program was administered by DOE, as well as for the USDOE's claim ofjurisdiction over the 11(c)(2) byproduct material at the FUSRAP Tonawanda Site.

24. Defendant UNITED STATES ARMY CORPS OF ENGINEERS ("USACE"), is a Division of the Department of the Army, organized and existing under j 3063 of Title 10 of the United States Code,10 U.S.C. g 3063.

25. Defendant, USACE, has assumed responsibility (as of October,1997) for the administration and execution of the FUSRAP, and as such, has or will exercise control over 11(c)(2) byproduct material at the Tonawanda FUSRAP Site.

26. Upon information and belief, defendant, DR. JOHN H. 2;IRSCHKY, is Acting Secretary of the Army (Civil Works). He signed the ROD and is responsible for the administration and execution of FUSRAP.

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27. Upon information and belief, defendant, LT. COL. MICHAEL J. CONRAD, JR.,

is District Manager of the Buffalo District of USACE. He is responsible for the administration and execution of FUSRAP at the FUSRAP Tonawanda Site.

IV. GENERALSUBSTANTIVE ALLEGATIONS

28. Upon information and belief, the Formerly Utilized Sites Remedial Action Program ("FUSRAP") was a DOE program to identify and perform remedial actions at former nuclear materials storage and processing facilities.

FUSRAP sites became~

radioactively contaminated with wastes from Manhattan Engineer District and/or Atomic Energy Conunission ("MED/AEC") related activities.

29.Upon information and belief, the FUSRAP Tonawanda Site consists of five properties: Linde (now Praxair), Ashland 1, Ashland 2, Seaway Landfill, and the Town of Tonawanda Landfill. These propenies, as well es area ground and surface waters, were contaminated with radioactive material as a result of MED/AEC operations during and after World War II.

30. Upon infonnation and belief, between 1942 and 1946, 8,000 tons of filter cake residues resulting from the processing of domestic uranium ores at Linde were dumped on the ground at Ashland 1 in a layer 1 to 5 feet thick. 'Ihe original volume of these residues was approximately 6000 cubic yards. The forces of erosion, combined with a complete lack of regulatory control which allowed the transfer of material to Ashland 2, and Seaway, have spread the contamination and increased the volume of contaminated soil to over 352,0,00 cubic yards. The wastes contain: 26.5 Curies (Ci) of total uranium (3,200 lbs per Curie) consisting of 13 Ci cach of U-238 and U-234, and 0.5 Ci of U-235; l

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x approximately 5 Ci of radium-226 (nalf-life: 1,600 years); from 39 to 52 Ci of thorium-230 (half-life: 77,000 years); and other decay chain members.

31.Upon information and belief, contaminated liquids were also discharged during MED/AEC operations at Linde, as follows: 55 million gallons containing 3.7 Ci of total uranium and 5.5 Ci of radium-226 were disposed ofin 7 bedrock injection wells on the Linde property; 56 million gallons of contaminated liquids containing 3.8 Ci of total uranium and 5.6 Curies of radium-226 were disposed ofinto the Town of Tonawanda's storm sewers and Two Mile Creek. An additional 6.5 Ci of natural uranium and 2.6 Ci of radium 226 were disposed ofinto Tonawanda's sanitary sewers.

32.Upon information and belief, buildings at the Linde property are also contaminated with radioactive waste as a result of MED/AEC related activities.

33. The FUSRAP Tonawanda Site is contaminated with radioactive material which is properly classified as byproduct material pursuant to Section 11(c)(2) of the AEA,42 U.S.C. g 2014(e)(2), as amended by UMTRCA, P.L.95-604,92 Stat 3021, et seg. As such the possession and/or transfer of such material required (as of 1978) and continues to require, a NRC license.

34. Upon information and belief, the radioactive material disposed of at the Ashland I property'also. satisfied, and continues to satisfy, the definition of the " source material" p

pursuant to Section 11(z)(2) of the 'AEA,42 U.S.C. g 2014(z)(2), and 10 C.F.R. Part 40, because it contained uranium in excess of 0.05%. As such the possession and transfer of such material required an AEC license, and continues to require, a NRC license.

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35. Upon infohnation and belief, New York is or was an " Agreement State" pursuant to Section 274 of the AEA, as amended,42 U.S.C. g 2021. On or about June 8,1978, under its authority as such an Agreement State, New York State, by the New York State Department of Labor ("NYSDOL"), issued to the Linde Division of Union Carbide Corporation, an amendment to its radioactive materials license allowing the possession of source material (Uranium 238 and Radium 226) at the Linde property. In June,1996, NYSDOL deleted said amendment, and did so without NRC assurance that the property had been decommissioned in accordance with NRC regulations, in violation of the AEA.

36. Defendant NRC has failed to exercise any regulatory jurisdiction over the 11(e)(2) byproduct materials and/or source materials at the FUSRAP Tonawanda Site pursuant to the AEA as amended by UMTRCA.

37. Upon information and belief, defendant USACE has no authority, in the nature of a license or exemption from the licensing requirement issued by NRC, to transfer or receive in interstate commerce, manufacture, produce, transfer, acquire, own, possess, import or export either byproduct material or source material.

38.In 1988, DOE issued a Notice ofIntent to Prepare an Environmental Impact Statement ("EIS") to evaluate altemative remedial actions for the long-term management of Tonawanda Site wastes. In so doing, DOE determined that an EIS is the appropriate level of NEPA review necessary to adequately inform decision-mak~ers and the public of reasonable altematives for minimizing any adverse impacts of the proposed action.

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39.In 1993, DOE released a Draft Remedial Investigation / Feasibility Study -

Environmental Impact Statement (" Draft RUFS-EIS") package for the 'FUSRAP

. Tonawanda Site.

40.In April 1994, DOE' " suspended"' the integrated NEPA/ CERCLA ~ EIS-environmental review process, stating that NEPA review was not being terminated at the Tonawanda Site, but that its future policy would be to incorporate NEPA values into CERCLA documentation.

41. DOE neverissued a FinalEIS.

42.Without issuing a Final EIS, DOE prepared.a Draft Proposed Plan for the Ashland 1 and Ashland 2 Sites (" Draft Proposed Plan").

43.Upon transfer of the responsibility and funding for the FUSRAP, the DOE-developed Draft Proposed Plan was adopted verbatim by USACE and released as the 1

i Final Proposed Elan (" Proposed Plan") solely as a CERCLA document, i.e. without incorporation of the Draft R1/FS-EIS, and without responding to the comments to the Draft REFS-EIS.

44. USACE never issued a FinalEIS.

45. Neither defendants DOE nor USACE consulted with, or obtained comments from, defendant NRC, with. respect to the environmental review process relative to the

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i remediation of the FUSRAP Tonawanda Site.

46. Defendant NRC has failed to fulfill its regulatory obligation under NEPA to

.. comment upon th proposed actions with respect to the FUSRAP Tonawanda Site.

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47.Upon information and belief, USACE intends to commence construction and remediation activity at the Ashland 1 (including Seaway Area D) and Ashland 2 properties pursuant to the ROD during the week of June 1,1998. Upon information and belief, US ACE intends to continue to perform " interim actions" at the Linde property.

48. F.A.C.T.S. and its members are adversely affected or aggrieved within the meaning of 5 U.S.C. g 702 and have suffered and will suffer unusual hardship and irreparable injury,in that defendants have violated NEPA and the AEA, as amended by UMTRCA, with respect to the FUSRAP Tonawanda Site, and that said violations have culminated in the performance ofillegal " interim actions" on the Linde property, and in the issuance of tie Proposed Plan and the ROD. If USACE proceeds or continues to l

proceed with its selected remedy, in violation of NEPA and the AEA, as amended by UMTRCA, the remediation of the Ashland 1 (including S:away Area D) and Ashland 2 properties will be performed to standards eight times less protective of human health and the environment than would be the case absent said violations of NEPA and the AEA.

Further, because the volume of contaminated soils will be greatly increased, the cost increment will undoubtedly prejudice and militate against the implementation of cleanup to the proper levels at a later date.

49. The injury"(ies) suffered by Plaintiff are repressible by the relief requested herein.

50. The actions or omissions complained of are final agency actions for which there is no other adequate remedy in a court.

V. FIRST CAUSE OF ACTION: PLAINTIFF SEEKS DECLARATORY JUDGMENT THAT DEFENDANT NRC HAS REGULATORY JURISDICTION OVER 11(E)(2) BYPRODUCT MATERIAL AT THE FUSRAP TONAWANDA SITE AND THAT DEFENDANT USACE LACKS SUCH JURISDICTION.

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51. Plaintiff repeats and realleges each and every allegation contained in Paragraphs "1" through "50" above.

52. Section 11(e)(2) of the AEA,42 U.S.C. g 2014(e)(2) defines the term " byproduct material" to mean:

(1) any radioactive material (except special nuclear material) yielded in or made radioactive by exposure to the radiation incident to the process of producing or utilizing special nuclear material, and (2) "the tailings or wastes produced by the extraction or concentration of uramum or thorium from any ore processed primarily for its source material content."

53.Section 11(z) of the AEA, 42 U.S.C. g 2014(e)(2) defines the term " source material" to mean (1) uranium, thorium, or any other material which is determined by the Commission pursuant to the provisions of section 2091 of [ Title 42] to be source material; or (2) ores containing one or more of the foregoing materials, in such concentration as the Commission may by regulation determine from time to time.

54. Title 10, Part 40, 40.5 of the Code of Federal Regulations, defines " source material" as "(1) Uranium or thorium, or any combination thereof in any physical or chemical form or (2) ores which contain by weight one twentieth of one percent (0.05%)

or more of: (i) Uranium, (ii) thorium or (iii) any combination thereof."

55. 42 U.S.C. j 2092 provides that:

Unless authorized by a general or specific license issued by the Commission which the Commission is authorized to issue, no person may transfer or receive in interstate commerce, transfer, deliver, receive possession of or title to, or import into or export from the United States any source material after removal from its place of deposit in nature, except that licenses shall not be required for quantities of source material which, in the opinion of the Commission, are unimportant.

56. Section 84 of the AEA,42 U.S.C. g 2114, as added by UMTRCA, g 205(a), P.L.95-604,92 Stat. 3039, provides that the NRC shall insure that the management of any 13

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byproduct material, as defined in section 11(c)(2) of the AEA is carried out in such manner as is specified therein.

57.42 U.S.C. g 2111 states that "{njo person may transfer or receive in interstate commerce, manufacture, produce, transfer, acquire, own, possess, impon, or export any byproduct material" except pursuant to a license or exemption issued by NRC.

58.Upon information and belief, all or substantially all of the radioactive material located at the Ashland I and Ashland 2 Sites, the Seaway Landfill and the Town of Tonawanda Landfill, are 11(c)(2) byproduct materials.

59. Upon information and belief, all or substantially all of the radioactive material located at the Ashland I and Ashland 2 Sites, and the Seaway Landfill also meet the definition of" source material" provided in 10 C.F.R. g 40.5.'

60. Upon information and belief, USACE has no authority to transfer or receive in interstate commerce, manufacture, produce, transfer, acquire, own, possess, import or export any byproduct material.

61. Upon information and belief, USACE has no authority to transfer or receive in interstate commerce, manufacture, produce, transfer, acquire, own, possess, import or expod any source material.

' As ofJanuary 1,1959,10 C.F.R. g 40.2 defined " source material" as "any material, except fissionable material, which contains by weight one twentieth of one percent (0.05%) or more of(l) uranium, (2) thorium, or (3) any combination thereof. At that time, the property now know as Ashland I was owned by the government. A radiological survey performed in 1957 indicated that the material deposited on the site contained more than 0.05% uranium. Said material was therefore source material and required a license for transfer. Nevertheless, the property was transferred to Ashland Oil by quitclaim deed in 1960, without a license.

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62.Notwithstanding the foregoing, USACE has undertaken to remediate the FUSRAP Tonawanda ' Site under the Comprehensive Environmental Response, Compensation and Liability Act. 42 U.S.C. gg 9601 et seg.

63. Upon information and belief, the NRC has failed, and continues to fail, to insure that the management of such byproduct material at the FUSRAP Tonawanda Site is carried out according to the applicable provisions of the AEA,' as amended, and the-regulations promulgated thereunder.

64. By letters dated December 27,1996 and January 4,1998, Plaintiff informed defendant NRC ofits belief that the radioactive material at the FUSRAP Tonawanda Site was subject to NRC jurisdiction and requested that NRC assume jurisdiction over said-materials.

65.To date, defendant NRC has refused to assume regulatory jurisdiction over the 11(c)(2) byproduct material and/or source material at the FUSRAP Tonawanda Site. By letter dated February 6,1998, Richard L. Bangart, Director, NRC Office of State Programs, informed Plaintiff that NRC lacks jurisdiction over the 11(c)(2) byproduct materials at the FUSRAP Tonawanda Site. Upon information and belief, defendant, NRC, has no intention of assuming jurisdiction over the 11(c)(2) byproduct material and/or source material at the FUSRAP Tonawanda Site.

66. Defendant NRC's failure to exercise regulatory jurisdiction over the 11(c)(2) byproduct material and/or source material at the FUSRAl Tonawanda Site has injured, i

and will injure, the Plaintiff and members of the Plaintiff organization in that remediation of the FUSRAP Tonawanda Site in the absence of such exercise of regulatory jurisdiction 15

by the defendant, NRC, will fail to accord the protection to Plaintiff and members of Plaintiff organization required by the AEA as amended by UMTRCA.

67. Defendant, USACE's, issuance of the ROD, and its intention to proceed with Site remediation in accordance therewith, and its continued " interim actions" at the Linde property, constitutes an imminent injury to the Plaintiff and its members. Said injury is repressible by the relief sought by this complaint.

VL SECOND CAUSE OF ACTION: PLAINTIFF SEEKS DECLARATORY JUDGMENT TH AT DEFENDANTS HAVE VIOLATED NEPA.

68. Plaintiff repeats and realleges each and every allegation contained in Paragraphs "1" through "67", above.

69.In 1988, DOE issued a Notice ofIntent to prepare an Environmental Impact Statement ("EIS") with respect the remediation of the FUSRAP Tonawanda Site. In so doing, DOE determined that an EIS is the appropriate level of NEPA review necessary to adequately inform decision-makers and the public of reasonable alternatives for minimizing any adverse impacts of the proposed stion.

70. In 1993, DOE relcased a combined Traft RemedialInvestigation/ Feasibility Study

- Environmental Impact Statement (" Draft REFS-EIS") package for the FUSRAP Tonawanda Site.

71. In April 1994, DOE suspended the integrated NEPA/ CERCLA EIS-environmental review process, stating that NEPA review was not being terminated at the Tonawanda Site, but that its future policy would be to incorporate NEPA values into CERCLA 4

documentation.

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~ 72. Thereafter, DOE failed to issue a Final EIS and completely suspended the NEPA 1

environmental review process at the FUSRAP Tonawanda Site, deciding instead to proceed exclusively under CERCLA.

73. NEPA requires that all environmental impacts of a proposed action be addressed.

42 U.S.C. g 4332(2)(C). DOE and USACE have violated this requirement of NEPA by failing to consider environmental impacts beyond 1000 years in the future. The half-life of the radioactive materials at the FUSRAP Tonawanda Site is of the order of tens of thousands of years.

74.NEPA requires that, prior to making the environmental impact statement, the responsible federal official shall consult with and obtain the comments of any Federal agency, which has jurisdiction by law or any special expertise with respect to any environmental impact involved. 42 U.S.C. g 4332(2)(C).

75. Upon information and belief, NRC has jurisdiction and/or expertise with respect to the envkonmental impact (s) involved with the remediation of the FUSRAP Tonawanda Site.

76.Upon information and belief, neither defendants DOE nor USACE consulted with, or obtained comments from, defendant NRC, with respect to the environmental review process relative to the remediation of the FUSRAP Tonawanda Site.

77. 40 C.F.R. 'g 1503.2 requires that all federal agencies having jurisdiction by law or expertise with respect to any environmental impact involved and agencies which are authorized to develop and enforce environmental standards shall comment on statements T

within theirjurisdiction, expertise or authority.

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78. Upon infonnation and belief NRC has failed to comment on any proposed action in connection with the FUSRAP Tonawanda Site.

79. Upon information and belief, the ROD released on April 20,1998, with respect to the Ashland 1 (Including Seaway Area D) and Ashland 2 Sites, and the " interim actions" performed at the Linde property, constitute improper segmentation of the review process with respect to the FUSRAP Tonawanda Site, designed to avoid full NEPA review of proposed action.

80. Defendant, USACE's, issuance of the ROD, and its intention to proceed with Site remediation in accordance therewith, and its continued " interim actions" at the Linde property, constitutes an imminent injury to the Plaintiff and its members. Said injury is repressible by the relief sought by this complaint.

i PRAYER FOR RELIEF j

WHEREFORE, Plaintiff, having no adequate remedy at law, respectfully requests that this Court:

A.

Enter a declaratory judgment that defendant, NRC, has regulatory jurisdiction and authority over all 11(e)(2) byproduct material and/or source material at the FUSRAP Tonawanda Site; and B.

Enter a declaratory judgment that defendant, USACE, has no jurisdiction or authority over any 11(c)(2) byproduct material or source material at the FUSRAP Tonawanda Site; C.

Enter a declaratory judgment that defendants have violated, and are in violation, of the National Environmental Policy Act; 18

L D.

Enter a declaratory judgment that the Record ofDecisionfor the Ashland 1 (Including Seaway Area D) and Ashland 2 Sites, dated April,1998, is null and void, of no effect, and unauthorized by law.

E.

Enter an Order enjoining defendant, USACE, from proceeding with the remediation of the Ashland 1 (including Seaway Area D) and Ashland 2 properties, i

pursuant to the Record ofDecisionfor the Ashland 1 (Including Seaway Area D) and Ashland 2 Sites, dated April,1998, or ofnerwise, unless 'and until defendant, NRC, properly exercises regulatory jurisdiction over the 11(c)(2) byproduct material and/or 11(z)(2) source material at the FUSRAP Tonawanda Site and the defendants fully comply with NEPA; and 1

F.

Enter an Order enjoining defendant, USACE, from proceeding with any I

" interim action" at the Linde property unless and until defendant, NRC, properly exercises regulatory jurisdiction over the 11(c)(2) byproduct material and/or 11(z)(2) source material at the FUSRAP Tonawanda Site and the defendants fully comply with NEPA; and G.

Award Plaintiff its costs and reasonable attorney's fees in this action pursuant to the Equal Access to Justice Act,28 U.S.C. 2412.

H.

Grant such other and further relief as the Court may deem just and proper.

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Res tfully submitted, 1 Abu./%{ fe M

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Fdncis'C. AinendoliEsq.'

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305 Elmwood Avenue 1

Buffalo,NY 14222 I

(716) 884-6733 l

Attomey for Plaintiff I

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1 International Committee on Microwave Weaoons v. United States. No. 08-0939.

. (GK) (D.D.C., filed on or about April 15,1998) aa,

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UNITED STATES NUCLEAR REGULATORY COMMISSION

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f June 8,1998

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OFFICE oF THE GENERAL counsel Ms. Kimberly N. Brown, AUSA Oflice of the U.S. Attorney, District of Columbia Judiciary Center 535 Fourth Street, N.W.

Washington, D.C. 20001 Re:

Intemational Committee on Offensive Microwave Weaoons v.

United States of America, Civil Action No. 98-0939 (GK) r ear Ms. Brown:

This is to provide the views of the Nuclear Regulatory Commission with respect to the above-captioned lawsuit, as it pertams specifically to the NRC.

Summan" The lawsuit charges, in part, that the NRC has failed to promulgate regulations implementing the

" Common Rule," and that this failure contravened the President's memorandum of March 27, 1997. The short answer to this is that the President's memorandum applied only to agencies that may conduct or sponsor classified research involving human subjects. The NRC neither conducts nor sponsors any such classified research; thus the President's memorandum did not obligate the NRC to adopt the Common Rule. To the extent that the complaint attacks the NRC's failure to promulgate a rule dealing with its licensees, the petitioners have failed to avail themselves of an available administrative remedy, and are in the wrong court. Finally, even if the NRC did conduct or sponsor such classified research, it is legally doubtful whether, as an independent regulatory agency, the President's memorandum would be binding upon it.

The Comnimint: Snecific Comments We shall now address in greater detail the pertinent paragraphs of the complaint.

j 14. It is correct that the NRC has not adopted the Common Rule.

j 18. While it is correct that the NRC was one of the addressees of the March 27,1997, Presidential memorandum, the memorandum directed action only by those agencies that may conduct or support classified research.

123. The complaint is therefore in error in stating that the Presidential memorandum required the NRC to adopt the Common Rule by March 27,1998.

126. Likewise, the complaint is in error in averring that the NRC currently conducts or sponsors classified research on human subjects.

_i______-.---_

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Discussion The following factual background may be helpful. In March,1982, the President's Commission for the Study of Ethical Problems in Medicine and Biomedical and Behavioral Research issued its first biennial repon. 47 Fed Reg 13272 (Mar. 29,1982). The report,in a paragraph headed

" Agencies Excluded From Further Review," said that it had excluded the NRC from its analysis, because the NRC, "as a matter of policy, does not conduct research involving human subjects except through health agencies, such as HHS, which impose their own regulations." Id at 13278. Accordingly, when the Common Rule was proposed,in 1988,53 Fed Reg. 45661 (Nov.

10,1988), and issued in final form, in 1991,56 Fed Reg 28003, the NRC was not among the 16 sponsoring agencies.

The very few projects in which the NRC does conduct or sponsor research on human subjects (e.g., testing nuclear power plant control room personnel on simulators to ensure that current stafling requirements are adequate to meet emergency conditions) are all non-classified, and the NRC has no intention of conducting classified research at any time in the future. Although the NRC is not bound by the portion of the Presidential memorandum pertaining to the Common Rule, it is required to make an annual repon to the Director of the Office of Science and Technology Policy, advising him of any classified research on human subjects conducted or supported by the agency. The NRC's most recen. such repon, dated November 14,1997, stated that the NRC had neither conducted nor supported any such research dming the preceding year.

A copy of that report is attached.

The President's memorandum of March 27,1997, explicitly stated that it was intended to create no enforceable legal rights of any kind. Even if that provision had not been included, however, the attempt to use an action in district court to force the NRC to adopt a particular rule would be unsound as a legal matter. Under the NRC's mies, persons who wish the NRC to adopt a mle can file a petition for rulemaking under 10 CFR f 2.202. Under 189 of the Atomic Energy Act, 42 U.S.C. } 2239, review of Commission action with respect to rules affecting NRC licensees lies exclusively in the Court of Appeals, and is governed by the Hobbs Act. See 28 U.S.C.

s 2342. Thus with respect to the NRC, the plaintiffs have both failed to avail themselves of their administrative remedies and have come to a court that is withoutjurisdiction to hear complaints of this kind.

Even if none of the foregoing legal infirmities in the complaint existed,' a final issue would remain: whether the President is legally empowered to issue a binding directive to an independent regulatory agency affecting its substantive responsibilities. However, the law on this point is ambiguous, where, as here, the directive to the agencies is neither clearly substantive i

nor clearly procedural. We have not elaborated on this issue here, given that there seem to be, as indicated above, several stronger legal objections to the complaint, at least as it applies to NRC.

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3 Please let us know if we can be of any further assistance.-

Sincerely,.

h ohnf. Cordes Solicitor

Attachment:

I.etter of November 14,1997, from NRC Chairman Shirley A. Jackson to Dr. John H. Gibbons, Director of the White House Office of Science and Technology Policy 4

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NUCLEAR REGULATORY COMMISSION WASHINGTON. D C. 206 4 0001 November 14, 1997

% *****,o CHAM 4Afd Dr. John H. Gibbons, Director Office of Science and Technology Policy The White House Washington, D.C. 20502 I

Dear Dr. Gibbons:

The purpose of this letter is to respond to a March 27,1997, memorandum from President Clinton to agency heads on " Strengthened Projections for Human Subjects of Classified Research." The President requested that each agency head inform the Director of OSTP wach year of the number of classified research projects involving human subjects underway on that date, the number completed in the previous 12-month period, and the number of human subjects in each project.

In accordance with the above public disclosure requirements of the March 27 memorandum, I am reporting that the U.S. Nuclear Regulatory Commission (NRC) does not conduct or sponsor classified research involving human subjects, has not conducted or sponsored such l

research in the previous 12-month period, and has no plans to do so in the future. Please be advised that the NRC has not adopted the Federal Policy for the Protection of Human Subjects (' Common Rule") (56 FR 28002-28018) for the reasons stated in the attached June 3,1996, letter to Senator Glenn. However, the NRC modified its regulations to add section 10 CFR 35.6 which requires NRC medical licensees to adopt the informed consent and institutional Review Board provisions of the Common Rule. As an example of how we conform our regulatory program to the Common Rule, the NRC remived a public comment during a recent rulemaking process requesting that the NRC extend its exempt licensing approach, for the diagnostic use of 1 microcurie of Carbon-14, to the research use of Carbon-14 on human subjects. In response, the Commission stated that the Common Rule does not provide an exemption for research invoMng minimal risk (including radiological consequences), and therefore, such research use is not exempt from the requirements of 10 CFR 35.6.

In the future, should the NRC conduct or sponsor classified research invoMng human subjects, the NRC will, as requested by the March 27,1997, memorandum, consider adoption of the Common Rule and annually provide the required information by the specified

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2-date. If the scope of the NRC research otherwise ch Common Rule. We will be pleased to provide any additionalinformation you ma regarding this subject.

Sincerely, q~

Shiriey Ann Jackson

Enclosure:

As stated g

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