ML20009F214

Answer Opposing Util Motion for Declaratory Order,Or Alternatively,To Dismiss Fl Cities from Proceeding.Fl Cities Waiver Did Not Extend to Ol.Certificate of Svc Encl

ML20009F214
Person / Time
Site:	Saint Lucie
Issue date:	07/27/1981
From:	Jablon R GAINESVILLE REGIONAL UTILITIES
To:	NRC COMMISSION (OCM)
References
ISSUANCES-A, NUDOCS 8107300149
Download: ML20009F214 (46)

Text

{{#Wiki_filter:_ _ _ _ _ _ Florida Ci .7 p 6 l // l UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION 7 11L 271981 P 3 ~ t w cf biSt utM1 cs::Lh** S In the Matter of ) ECh I A cn t FLORIDA POWER & LIGHT COMPANY ) Docket No. 50-3 m ) l (St. Lucie Nuclear Power Plaat, ) July 27, 1981 Unit No. 2) ) FLORIDA CITIES' ANSWER TO " MOTION OF FLORIDA POWER & LIGHT COMPANY FOR DECLARATORY ORDER, OR IN THE ALTERNATIVE, TO DISMISS THE FLORIDA CITIES FROM THE PROCEEDING" q, Robert A. Jablon 1 p Alan J. Roth f (d f /j 3 Attorneys for the Gainesville. Regicnal h., Ugg o 31981"h / l Utilities, the Lake Worth Utilities 'O Authority, the Utilities Commission of ~4 ~ New Smyrna Beach, the Sebring Utilities k

1. A Commission, and the Cities of Alachua, S

Bartow, Fort Meade, Key West, Lake Helen, g Mount Dora, Newberry, St. Cloud and y Tallahassee, Florida, and the Florida Municipal Utilities Agency July 27, 1981 Law offices of: Spiegel & McDiarmid 2600 Virginia Avenue N.W. Washington, D.C. 20037 l l 8107300149 810727 ' ' $ $of' PDR ADOCK' 05000389 - 80 l M P DR -

r ~ TABLE OF CONTENTS Page I. FLORIDA CITIES' WAIVER D: ' NOT EXTEND TO THE OPERATING LICENSE FOR ST. LUCIE UNIT NO. 2.......................... 4 A. The Orders Granting Florida Cities' Intervention In The St. Lucie Unit 2 Construction Permit Proceeding Establish The Conditions Of Intervention................................. 4 B. Florida Cities' Waiver Expressly Refers To The Construction Permit....................................... 7 C. The Board Should Not Infer A Waiver Unless It Was Clearly Made......................................... 12 II. POLICY GROUNDS DO NOT SUPPORT GRANTING THE RELIEF SOUGHT BY FPL, IN THE ABSENCE OF A WAIVER RELATIVE TO THE OPERATING LICENSE................................. 13 CONCLUSION............................................ 17 ATTACHMENTS I r -i-e -,- -n, ,--,,_-..n e -,-.v-..

TABLE OF AUTFORITIES Page Court Cases: Aetna Insurance Co. v. Kennedy, 301 U.S.

389, 13 393 (1937)

Barker v. Wingo, 407 U.S. 514, 525 (1972) 13 Brooklyn Bank v. O'Neil, 324 U.S. 697, 704 12, 18 (1945) Glus v. Brooklyn Eastern Terminal, 359 17 U.S. 231 (1958) Power Reactor Development Co. v. International Union of Electrical Radio and Machine Workers, 16 AFL-CIO, 367 U.S. 397 (1961) United States v. Stout, 475 F.2d 1190 (4th 13 Cir. 1969) Agency Cases: Duke Power Co. (Catawba Nuclear StLtion, Units 1 and 2), 7 AEC 307 (1974)................... 5 ~ Florida Power & Light Company (St. Lucie Nuclear Power Plant, Unit No. 2), ALAB-420, 6 NRC 16 8, 24 (1977) Florida Power & Light Company (St. Lucie Nuclear Power Plant, Unit No. 2),~ (LBP-77-23, 5 NRC 789, 800-801, affirmed, ALAB-420, 6 NRC 8, 23, affirmed, CLI-78-12, 7 NRC 939).............................. 5-7 Louisiana Power & Light Co. (Waterford Steam Electric Station, Unit 3), 6 AEC 48 (1973); 6 AEC 619 (1973)................................... 5 Toledo Edison Company (Davis-Besse Nuclear Power Station, Unit 1), ALAB-323, 3 NRC 5, 12, 331 (1976) Statutes: 1 Atomic Energy Act, $105, 42 U.S.C. $2135 6, 12, 16 - ii - , ~, - -. -.. - -

Florida Cities:7/27/81 UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION In the Matter of ) ) FLORIDA POWER & LIGHT COMPANY ) Docket No. 50-389A ) (St. Lucie Nuclear Power Plant, ) July 27, 1981 Unit No. 2) ) FLORIDA CITIES' ANSWER TO " MOTION OF FLORIDA POWER & LIGHT COMPANY FOR DECLARATORY ORDER, OR IN THE ALTERNATIVE, TO DISMISS THE FLORIDA CITIES FROM THE PROCEEDING" On June 2, Florida Power & Light Company ("FPL" or " Company") requested that Florida Cities enter into a stipulation in this docket "that the operating license for St. Lucie Unit No. 2 and any and all amendments thereto may issue at any time notwithstanding the pendency and status of antitrust review proceedings with respect to St. Lucie Unit No. 2." 1,/ When Florida Cities failed to agree, FPL moved for an order "that the Cities are estopped from objecting to issuance of an operating license for St. Lucie Unit No. 2..." or " dismissing the cities from this proceeding unless they desist from interposing any such objection." 2/ FPL claims that when Florida Cities sought late 1/ The proposed stipulation is part of Attachment A to the Company's July 16, 1981 Motion. 2/ " Motion of Florida Power & Light Company For Declaratory Order, Or In The Alternative To Dismiss The Florida Cities From The Proceeding" (July 16, 1981, pp. 19-20). For convenience, this Motion is cited "FPL Motion, p.

_ intervention in this construction proceeding, they waived rights to object "to issuance of the operating license on the ground of the pendency of this proceeding." FPL Motion,

p. S.

FPL has requested.that Ehe Cities now agree tc a stipulation that will give it absolute assurance that it can operate the unit, regardless of the stetus of antitrust review. Florida Cities have stated that they are unwilling to enter into the sti-pulation as proposed by FPL, but would consider such stipulation if they could be assured either of expeditious procedures so that antitritst review would be complete before the plant operates or of interim relief agreed to betweeen the parties. 1/ Such latter agreement would mitigate the harm to Cities from FPL's operation of St. Lucie Unit No. 2 without adequate protection of Cities from antitrust abuse. 2/ 1/ Letter from Robert A. Jablon and Alan J.* Roth to J. A. Bouknight, Jr., June 11, 1981 (Attachment B to FPL Motion). 2/ Under the interim license conditions, FPL has agreed to the sale to some of Florida Cities of approximately 38 megawatts of St. Lucie Unit No. 2 and certain other relief. While the Cities have agreed to share some of that capacity among thenselves, including to Cities in Florida Power Corporation's retail service area, relief is restricted to Cities in or near FPL's retail service area. FPL adheres to a policy of refusing to deal in various aspacts of power supply with entities outside its retail service area. In referring to interim relief, Florida Cities would request mutually agreed upon power sales to meet " base load" and related transmission. If agreed to, the commencement of operation of St. Lucie Unit No. 2 would be less in furtherance of restricting markets along retail service area lines, although Cities would not obtain the advantages of additional ownership or other access of St. Lucie or other nuclear units. ~

3-Florida Cities do not seek to amend the order granting their interventie n in thi.: proceeding, or conditions to that order, or the stipulation that they made during oral argument February 1, 1977 to the Petitions Board at Tr. 4-11. 1/ Nor do they seek to limit any other commitment that they may be deemed to have made. Thus, if it is determined Florida Cities' waiver is of the scope contended by FPL, the Cities will be bound. However, the Cities deny that they waived their right to a conclusion of the antitrust review before any grant of an operating license, and they simply refuse to enter into a new -- and they believe broader -- stipulation at EPL's request, which they believe may be adverse to their interests unless they obtain protections from FPL against delay. Assuming that this Board finds that it has jurisdiction, Florida Cities do not object to the Board's interpreting the scope of their previous waiver. However, all that appears to be at issue is an assertion by FPL that it is now entitled to a declaratory order by this Board concerning the scope of Florida Cities' previous commitments. Florida Cities respond on the assumption that this Board will determine that it should reach the merits of the scope of the waiver, l l 1/ For convenient reference, these transcript pages are attached. I i

4-I. FLORIDA CITIES' WAIVER DID NOT EXTEND TO THE OPERATING LICENSE FO R ST. LUCIE UNIT NO. 2. In seeking late intervention in this docket, counsel for Florida Cities stated "if intervention is granted, the Florida Cities would accep as a condition of any intervention an order that the construction may go forward. " 1/ FPL interprets Florida Cities' waiver to cover the operating license. Florida Cities disagree. Assuming a declaratory order should be granted, the sole question before the Board is how the waiver, which admittedly was made, should be interpreted. A. The Orders Granting Florida Cities' Intervention In The St. Lucie Unit 2 Construction Permit Proceeding Establish The Conditions Of Intervention. Florida Cities were granted late intervention in this proceeding in recognition that they had agreed that there should be no delay of the construction of St. Lucie Unit No. 2 while antitrust review takes place. These orders do not establish that as a condition of intervention the Cities must " desist from interposing any such objection to issuance of an operating license for St. Lucie Unit No. 2 on the ground of the pendency of this proceeding." FPL Motion, p. 19. 1/ Transcript of oral argument February 1,

1977, p.

5. Subsequent references to this transcript are cited Tr. lines See Attachment A. ~ -c y .,-c While FPL quotes Florida Cities' pleadings (out of context, Florida Cities believe), with one exception the Company studiously avoids reliance on the orders that establish the conditions of Florida Cities' intervention. In granting the Cities late intervention, the Petitions Board plainly interpreted the Cities' commitment as waiving rights with regard to the construction permit (LBP-77-23, 5 NRC 789, 800-801, affirmed, ALAB-420, 6 NRC 8, 23, affirmed, CLI-78-12, 7 NRC 939). The natitions Board stated: "... Ordinarily, if this Board were to order an antitrust hearing, the construction permit could not issue until that hearing is completed." Lousiana Power & Light Co. (Waterford Steam Electric Generation Station, Unit 3), 6 AEC 48, 50, n.2 (February 28, 1973)i 6 AEC 619, 621-22 (September 28, 1973); Duke Power Co. (Catwaba Nuclear Station, Units 1 and 2), 7 AEC 307, 309 (April 8, 1974); Toledo Edison Co. (Davis-Besse Nuclear Power Station, Unit 1), ALAB-323, 3 NRC 331, 340 (April 14, 1976). However, in Waterford, Ibid., the Commission held that, with the agreement of all of the parties involved, j prelicensing antitrust review would not be required. Throughout the Joint Petition, and Petitioners' Reply, references are made to the fact that Florida Cities do not seek to delay the issuance of the St. Lucie 2 construction permit. E.g.,

p. 43 Joint Petition,

p. 61 Reply.

In addition, the board in oral l arguments inquired exhaustively as to petitioners' statement that no delav in the construction permit is requested nor expected. The response was unqualified (Tr. 5-12). Petitioners agree that the construction permit would issue (Tr. 11). Likewise the NRC Staff, which does not favor the antitrust hearing in the first instance, agrees that the ordering ~ ,nv. r. ,c.,,-.

6-of an antitrust hearing in this proceeding should not serve to delay the issuing of a ~ ~ - ' construction permit (Tr. 17-18). Because of the lateness of the petition we regard the agreement to permit the centstruction permit to Tssue before the completion of an antitrust hearing to be a material aspect of the considerations underlying this Order. " (emphasis supplied) No condition was placed on Florida Cities that they waive rights as to the operating license as well as the construction permit. Indeed, since Florida Cities an'd others would have had an independent right to intervene at the operating license stage, assuming they met statutory requirements, it is difficult to perceive the basis upon which such stipulation could have been reasonably requested. See Atomic Enwegy Act, 105c, 42 U.S.C. $2135c. The Commission itself affirmed the Petitions Board's order in all relevant aspects (supra, 7 NRC 939) without imposing the limitation that FPL now claims existed. FPL has no basis now to seek to expand the conditions upon which Florida Cities were granted intervention. In its pleading, FPL cites the Appeal Board decision for the proposition that the Board was concerned with delay in operation of St. Lucie Unit No. 2. However, at the very page of the decision, which is relied upon by FPL (FPL Motion, pp. 11-12, citing ALAB-420, supra, 6 NRC at 23), the Appeal Board directly refers to "the municipalities' agreement to allow issuance of the St. Lucie 2 construction permit (see p. 13, supra) " and at n

the back reference (p. 13) the Appeal Board refers solely to the construction permit: "The third was the agreement of Orlando and the other intervenors to allowing the S t. Lucie 2 construction permit to issue before their antitrust contentions were heard, thereby eliminating any need tp hold up construction of that plant penoing resolution of those contentions. " (emphasis supplied in quotations, footnote omitted) The only condition placed upon intervention by the Commission concerns construction. B. Florida Cities' Waiver Expressly Refers To The Construction Permit. In order to establish that an independent waiver provides grounds for " estoppel" of the Cities, FPL references quotations from three pleadings of the Cities. However, EPL does not quote the transcript where the actual waiver was made. As stated, this was during oral argument before the Petitions Board on February 1, 1977. At that time counsel for Florida Cities stated: "... And I state here that the Florida Cities believe it is certainly a reasonable condition of our intervention, do not oppose and, indeed, affirmatively seek a condition to our intervention that the construction permit may issue..." (Tr. 6) " CHAIRMAN SMITH: For now, at least, you af firmatively agree that, in the event an l antitrust hearing on St. Lucie 2 is ordered, that it will not impact upon the issuance of a construct permit? O I l t l

-g-l MR. JABLON: Yes, your Honor." (Tr.,

p. 7)

Mr. Bouknight, coue:sel for FPL, requested clarification whether the waiver was irrevocable and whether the Cities were inserting a requirement of interim relief as a condition for such waiver. Counsel for Florida Cities responded (Tr., pp. 8-9): MR. JABLON: Well, with regard co the latter point, on the issuance of the cc.nstruction permit, I would think it would be irrevocable. We have made or attempted to make a good-faith waiver. We so do so. I can see no reason why the Board cannot attach that as a condition. My remarks here are being recorded.

Yes, I do mean it as irrevocable.

I mean it as a commitment as counsel of the Florida Cities that the construction permit in St. Lucie 2 should go forward." [N]or do I mean to suggest that, should you deny the [ interim] relief we seek, that the construction i, ;ill should not go forward. " Indeed, counsel for FPL himself appeared to understand that waiver went to construction: "MR. BOUKNIGHT: I think, if I understood him correctly, he said that it was unconditional...." We are talking -- and, of course, you know it is our position that this petition shouldn't be granted in any event. But if we were to be in a position where we were 6 ..__m-m--

_ _ _ _ _ _ _ _ _ _ _ constructing the power plant on the basis of this kind of an agreement, then Florida 'ower & Light Company would have several h-ted people out in the field engaging in construction activities and a great deal of money involved. And we simply couldn't face a claim of changed circumstances a few months down the line as a basis for changing this agreement." (Tr., p. 10) Counsel for Florida Cities again responded at the request of the Bogrd Chairman: "On behalf of the Florida Cities, I state, first, that we are not opposed to conditioning our intervention unqualifiedly upon.our agreement that the construction shall issue; second, that we commit ourselves not to seek -- well, we have, have your Hcnor, absolutely no intention whatsoever, unqualifiedly, to seek a cessation of construction, and indeed, it would be against our interests to do so." We seek interim and permanent relief. We do not seek delay in the construction, and we are willing to abide by that as a condition of our obtaining the intervention we seek." (Tr., p. 11) At page 12, counsel for the NRC Staff similarly referred to satisfaction with Florida Cities' position "with respect to later trying to delay the construction permit." The above discussion which is set forth at full in the appendix makes it plain that the waiver was to the construction permit. FPL quotes page 14 of Florida Cities' Joint Petition To Intervene (FPL Motion, pp. 8-9, 11 and their Reply Brief (FPL

Motion,

p. 9) where Florida Cities state:

"... Cities do not seek a delay in actual construction or operation of the Turkey Point No. 3 and No. 4 or St. Lucie No. 1 and 2 nuclear units."

10 In the quoted reference at page 14 of their Joint Petition 1/ Florida Cities expressly referred to Purkey Point Nos. 3 and 4, which were in operation and St. Lucie No. 1, which was planned for operation. The Cities were seeking intervention and relief relating to all units. Thus they state the they do not seek a delay in " actual construction or operation of the units." The waiver by Cities was defined in oral argument and in the Commission's order. However, the reference relied upon by FPL itself does not help its cause. 2/ FPL's quotation from Florida Cities' Reply Brief 3/ is even more truncated and out of context. At page 9 of its Motion, FPL quotes part of a footnote by Florida Cities. As the text and footnote make clear, Florida Cities were responding to allegations by FPL that in seeking access to FPL'seoperating 1/ " Joint Petition of Florida Cities For Leave To Intervene Out Of Time; Petition To Intervene; And Request For Hearing," Florida Power & Light Company (St. Lucie Plant, Unit Nos. 1 and 2), Florida Power & Light Company (Turkey Point Plant, Unit Nos. 3 and 4), Docket Nos. 50-335A eti al. (August 9, 1976). 2/ In language not quoted by FPL, Florida Cities were also seeking interim relief to " prevent use of existing generation as part of an anticompetitive scheme, pending the outcome of proceedings." Such language, which is contained in the original paragraph but is omitted from the portion quoted by FPL in its Motion, puts in context the reference to " operation" of the plants. The reference to interim relief comes immediately after the language quoted by FPL. 3/ " Reply Of Florida Cities To Responses Of Florida Power & Light Company And Nuclear Regulatory Commission Staff" (October 19, 1976). _-4 _y. 7-nuclear units, "an adverse impact upon FPL's ability to obtain needed capital" could result. See Reply Brief, pp. 16-18 and references therein. In this context, Florida Cities stated tha t "FPL has been totally nonspecific about the harms it fears," but that they would be prepared "at the threshhold of this case, to enter into all appropriate stipulations, procedural and substantive, necessary to eliminate any real adverse impact on FPL." Thus, Florida Cities offered to enter into certain stipulations based upon FPL's assertions of harm, but FPL never responded. Therefore, there were no such stipulations. In the specific footnote quoted by FPL, Florida Cities begin: "If Florida Cities were to receive a direct ownership share in the existing nuclear units, FPL's investment would be well protected..." (emphasis added) They go on in the first sentence of paragraph 2, " Florida Cities have offered to stipulate issres, in order to elminate uncertainty." l FPL did no+. quote or refer to this sentence. FPL argues that Florida Cities agreed to a waiver in relation l to the operation of St. Lucie Unit No. 2. In fact, however, the Cities offered to enter into stipulations in conjunction with I their request for access to the operating units, but FPL never took up the offer. No such stipulation was made. Finally, at p. 11, FPL quotes Florida Cities' Brief to the Commission that a grant of intervention "will not delay l construction or operation" of St. Lucie Unit 2. Of course, this 1 l l 1

,., language intended no new waiver, but was an argument and prediction that the gra.itt of intervention would not delay a unit scheduled for operation years into the future, when the Cities were waiving rights with regard to construction. C. The Board Should Not Infer A Waiver Unless It Was Clearly Made. If it should be found (contrary to the Cities ' position) that they have waived rights in relation to the operation of the unit, they have no intention of seeking to undo what they have done. 1/ Their difference with FPL is factual. They do not believe that they have made the waiver that FPL claims. 1/ Under some circumstances case law would refuse to credit a waiver that frustrates statutory policies. For example, in Brooklyn Bank v. O'Neil, 324 U.S. 697, 704 (1945), the Supreme ~ Court went so far as to hold "... a statutory right conferred upon a private party, but affecting the public interest, may not be waived or released if such waiver or release contravenes the statutory policy.... Where a private right is granted in the public interest to effectuate a legislative policy, waiver of a right so charged or colored with the public interest will not be allowed where it would thwart the legislative policy which is was designed to effectuate." (citations and l footnote omitted) Cities do not make any claim here that they should be released from any waiver that they have made. However, in view of the l strong antitrust remedial policies of $105, and the policies i underlying O'Neil, supra, the Cities should not be estopped on any basis other than a waiver made by the Cities (See Toledo Edison Co., supra, 3 NRC 331, and ambiguities should be interpreted in favor of the Cities. See text, infra. ,n ,, ~ Moreover, courts have been disinclined to infer that righte ~ have been waived absent clear evidence of waiver. See United States v. Stout, 415 F.2d 1190 ( 4 th Cir. 1969), no waiver of right to conscientous objection to be inferred from broad or ambiguous language signed by objector. The language of Cities' waiver is specific and refers only to construction. " Courts should indulge every reasonable presumption against waiver." Barker v. Wingo, 407 U.S. 514, 525 (1972), quoting Aetna Insurance Co.

v. Kennedy, 301 U.S.

389, 393 (1937) (waiver of right to trial by jury not shown). In short, the Commission orders and the waiver of Florida Cities with regard to the construction permit provide no grounds for creating or inferring a waiver of Florida Cities' rights with regard to the operating license. II. POLICY GROUNDS DO NOT SUPPORT GRANTING THE RELIEF SOUGHT BY FPL, IN THE ABSENCE OF A WAIVER RELATIVE TO THE OPERATING LICENSE. Using strong language, FPL castigates the Cities for disavowing commitments and for seeking delay of St. Lucie Unit No. 2. As stated in the introduction and Section I of this pleading, Florida Cities have not broken any comitments. FPL may now desire a stipulation never entered into, but that does not justify the relief sought. FPL stresses that there is a public interest in timely operation of St. Lucie Unit No. 2. Florida Cities agree. As FPL recognizes in its pleading, many of the Cities are potential

14 - i co-owners of the unit and, no less than FPL, they have an interest in its timely operation. See FPL Motion, pages 4, 13. However, the Cities also have an interest in resolving antitrust matters and, indeed, in not having St. Lucie Unit No. 2 go into operation without adequate license conditions to protect against the unit's being used in an anticompetitive manner. Thus, in the letter from Robert A. Jablon and Alan J. Roth to J.A. Bouknight Jr., dated June 11, 1981 ( Attachment B to FPL Motion),' the Cities state: "The Citie s share your concern that St. l Lucie 2 should be able to operate on schedule. Some or all of them will be owners of that unit and some Cities purchase power from FPL. Indeed, they are gravely concerned that the antitrust review is taking so long. The problem should have been resolved by settlement, but the fact is that FPL has not been willing to offer sufficient capacity from St. Lucie 2 and other relief that the Cities believe would have justified settlement. Further, since FPL has made capacity available to some Cities but not to others, the Cities are faced with the Hobson's choice of sharing nuclear capacity among themselves, thereby I cutting the amount of St. Lucie 2 capacity available to any one system, or of not sharing, in Which case some intervenors would receive no capacity. If the Cities were to agree to the unconditioned waiver that you propose, the plant could go into operation with many Cities getting no share or minimal capacity and all Cities getting What they deem insufficient antitrust relief. FPL may then have little or no interest in speed in the antitrust review. In any event, the plant would operate without the antitrust review contemplated by the Atomic Energy Act. The solution to all these problems, it would appear, would be for all parties to stipulate to expeditious procedures. The Cities have long been disturbed by the prospect that protracted litigation would 1

t force a sacrifice of their rights. Certainly, ~ if the Cities have valid claims, relief should be decided soon. The Cities agree that operation of the plant should not be delayed. Taking into account these considerations, we would be prepared to recommend to our clients that they sign your proposed stipulation, providing that a hearing schedule and procedures were agreed to that permit antitrust resolution by the Board before the operating license becomes effective and that there would be no stay of Board ordered license conditions, pending any review.. l If the above it not acceptable, we would be prepared to recommend the waiver that you propose, if FPL agrees to interim relief to lessen the adverse impact on Cities from the operation of the plant before antitrust review is concluded. However, absent some constraint, an incentive could be created to unduly prolonged litigation. I suggest an early meeting to resolve these matters." Florida Cities have not stated and are not stating that they will object to the operation of S,t. Lucie Unit No. 2 on schedule. Nor has FPL commited when the plant will operate in fact. The only thing that the Cities state at this time is that they are unwilling to extend the scope of past waivers without assurance either that antitrust re riew can be completed by the time of operation or that appropriate interim relief can be agreed upon. FPL asserts,

p. 18, n.1, that the Cities would not be hurt by its requested waiver since the Board can control the scheduling of proceeding.

However, it suggests the necessity for " extensive discovery" and " extensive evidentiary hearings." FPL Motion, p. 7. The sad fact is that often the best defense to antitrust claims is delay, and FPL suggests that hearings will be lengthy.

~ 16 - As the Appeal Board has recognized in Toledo Edison Company (Davis-Besse Nuclear Power Station, Unit 1), ALAB-323, 3 NRC 331 (1976), and as the Commission and various appeal and licensing boards have recognized generally, the Atomic Energy Act seeks to accomodate both interests of licensees or potential licensees in economic operation of units and the further interests of competing entities and the public the! these units not be used anticompetitively. However, FPL would recognize only the lormer The statutory scheme of the Atomic Energy Act is such concerns. that it establishes a staged review process, Power Reactor Development Co. v. International Union of Electrical Radio and Machine Workers, AFL-CIO, 367 U.S. 397 (1961), which enccmpasses strict antitrust review. Atomic Energy Act, $105, 42 U.S.C. 2135. Toledo Edison Company, supra, 3 NRC 331. In seeking to relate any additional waiver to assurance that antitrust issues will in fact be resolved at the time of plant operation or that there is opportunity for additional limited interim relief, Florida Cities seek no more than the accomodation of interests that is envisioned by the statutory structure. If it be thought that the company is being placed in an unfair position, to paraphrase the Appeal Board in this case, whatever merit the Company's argument may have in other circumstances, it hes been the Company's own actions which are the reason its antitrust responsibilities were not settled earlier. Florida Power & Light Company (St. Lucie Nuclear Power Plant, Unit No. 2), ALAB-420, 6 NRC 8, 24 (1977).

- 17 FPL's invective aside, Florida Cities' fears are far from groundless. As the Board is aware, Florida Power & Light has been found guilty of violating Ohe antitrust laws and the Company continues to refuse to deal over a broad spectrum with many of the Cities in the Fi3rida Cities group. The Chief Executive Officer of FPL has disavowed the correctness of some of those decisions and has disavowed knowledge of others (see Attachment 3), and one highly placed official has suggested that when its antitrust proceedings are over, the Company will again consider acquisition of municipals (Attachment C). Under such circumstances, Florida Cities should not he forced to waive rights under the Act without obtaining adequate protection. CONCLUSION ~ For the foregoing reasons, FPL's Motion should be denied. Respectfully submitted, /4/A. & Robert A. Ja lon Alan J. Roth Attorneys for the Gainesville Regional Utilities, the Lake Worth Utilities Authority, the Utilities Commission of New Smyrna Beach, the Sebring Utilities Commission, and the Cities of Alachua, Bartow, Fort Meade, Key West, Lake Helen, Mount Dora, Newberry, St. Cloud and Tallahassee, Florida, and the Florida Municipal Utilities Agency July 27, 1981 Law offices of: Spiegel & McDiarmid 2600 Virginia Avenue N.W. Washington, D.C. 20037 )

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_----------__x 3

C ORAL ARGUMENT IN THE MATTER OF: 5: FLORIDA POWER & LIGHT COMPANY Docket Nos. 50-389A 50-335A 3, (St. Lucie Plant, Unit Nos. 50-250A 1 and 2) and 50-251A (Tdrkey Point Plant, Units 'a 3 and 4) - - - - - - - - - - - - - - - - - -x 10 i 11 1 Fifth Floor Hearing Room East / West Towers 12 t 4350 East / West Highway Sethesda, Maryland 13 y '; Tuesday, 1 February 1977 15.l Oral Argument in the above-entitled matter was convened, e 16 l pursuant to notice, at 9:30 a.m. 3 j. SEFORE: I

g i VAN SMITH, Chairman i

Atomic Safety and Licensing Board 19 ' JOHN FRYSIAK, Member y i 20 ! l DANIEL M. HEAD, Member 21 : APPEARANCES: 'i 22 ROBERT A. JADLON, Spiegel & McDiarmid, 2G00 Virginia I 23

Avenue, N. W.,

Washington, D. C. 20003; on behalf k. j of Intervenor, Florida Cities. 7t. .5,.'=.m,,-, ,,,,,. j J. A. BOUKNIGHT, JR., Lowenstein, Newman, Reis &

5 Axelrad, 1025 Connecticut Avenue, N.

W., Washington, D. C., Suite 1214; and

2

c APPEARANCES:

(continued) JOHN E. MATHEWS, JR., Mathews, Osborne, Ehrlich, 3l McNatt, Gobelman and Cobb, 1530 American Heritage Life Building, Jacksonville, Florida 32202; on -l behalf of Apolicant. (. LEE DEWEY and MICHAEL JONES, Office of the Executive Legal Director, Nuclear Regulatory Commission, ~ Bethesda, Maryland; on of the Nuclear Regulatory Staff. ALSO PRESENT: 3 WILLIAM H. CHANDLER, Post Office Drawer 0, Gainesville, Florida 32601; JOHN H. HASWELL, 3671 N. W. 37th Street, Gainesville, Florida 32605; and i 10 + TRACY DANESE i 12 ' 13 ! + g a1 16 ! 4! l 17.1 .I I3 il 19 li il 'l 20-! 'l 21 :1 .' i 22 i! 9 h l 23 '! km a. ? 3=rje,p 2,une,e,,, g, t 25 i I

l?. CX l cn l 3 I PR0CEEDI NGS 2 CHAIRMAN SMITH: Mr. Dewey, you have co-counsel 3 with you? 4 MR. DEWEY: Y e s., s i r, I d o. With me today is Mr. 5 '41chael Jones of the Nuclear Requlatory Commission Sta f f. 6 CHAIRMAN SMITH - Mr. Jones. 7 MR. JONES: Good morning. 8 MR. BOUKNIGHT: Mr. Cha ir:mn, with us today and 9 seated at the counsel table to my lef t and behind me is-10 Tracy Danese, vice president of Florida Power & Ligh t Company. II He is not appearing as counsel, but he is here. 12 MR. DANESE: Good morning. ( 13 CHAIRMAN SMIT'it Mr. Jablon, do you have any new la faces? 15 MR. JABLON: No, your Honor. 16 CHAIRMAN SMITH: Inasmuch as this is the first .17 argument in this case, I guess we are all new to this la proc eed ing. lie will have oral arguments this morning. 19 I guess we should also acknowledge the presence 20 of Mr. Chandler, who is not strictly a party to this oral 2! argument, if "partyd is the correct word, but he is an invited 22 guest and is present. 23 And do you have~ someone with you, Mr. Chandler? 24 MR. CHANDLER: I ha ve Mr. Haswell o f my o f fice. 25 who is also here, I guess you might say, as an invited guest.

4 c" 2 I CHAIRMAN SMITH: We will hear arguments this ( 2 mor.ning in two basi c catagories. The first will be the 3 petition to intervene filed by the Florida Cities in the 4 St. Lucie No. 2 uni t, in which our interest will be th a 5 extent tha t section 2.714, volume 4., intervention, is 6 ccmplied wi th or not complied with. 7 Then our second consideration will be the 8 petitions for intervention and antitrust hearing with respect 9 to St. Lucie No. I and the Turkey Point units, which we will ~ probably. he referring to as the old units or ope rating units 10 11 this morning. And in that respect, the Board will wish to 12 be advised or may have questions on the Commission's juris-(. 13 diction and authority to conduct any antitrust review with 14 r.espect to the old plants; and, assuming such authority exists, 15 the authority, i f any, o f this Boa rd to orde r an anti trus t 16 hearing, as compared to the remedies under section 2.206 and .17 2.202 of the Commission's rules. 18 Beginning -- first, before we begin with oral 19 arguments, are there any preliminary sta tements or announce-20 ments that tne whole matter has been settled and we may go 21 home ? 22 Without any preliminary matters, we will ask Mr. 23 Jablon if you will address'yourself, please, to the portions (_ - 24 of your pe tition for leave to -intervene and your responses 25, which purport to assure that no delay would be occasioned by -e u

-' 3 5 I a crantino of the petition to inte vene in t.e St. Lucie {' 2 No. 2. 3 Would you be specific and point to the exact portions of your papers from which the Board may learn this? 4 5 MR. JAB LON: Yes, your Honor. 6 Well, first of all, with regard to the delay point, 7 I will get the page references in a second. 8 In your order setting f orth the oral arguments, the 9 Board asked the question about the construction permit. We 10 had written a letter to the conpany, and we had stated in our il pleadings that, if intervention is granted, the Florida Cities 12 would accept as a condition of any in,tervention an order (, 13 tnat the construction nay go forward. 14 We did not express it in those terms. hhat we 15 stated explicitly was that we were willing to stipulate, 16 and 1.f it hasn't been clearly sa, stipulate here that inso f ar 17 as the Florida Cities are concerned, we very explici tly waive 18 any claim that we might have that the construction permit 19 should not issue, subject to the condi tion, of cm.cse, that 20 any order that you might subsequently issue on the ma tter 21 would be e f f ective. I re fer specifically to page 42 o f tay l 22 pe ti tion to in te rve ne. 23 CHAIRMAN SMITH:' You address yourself to this at (_ - 24 page 26, 39, 42, 4 3, and 61 of your response. 25 MR. JAO LON: You're ahead of me, your Honor. j w_

r-4 6 I CHAIRMAN SMITH: There may be other places. You 2 ret-er to page 6 of your petition as the area where you talk 3 about stipulation, but I think that may be in e rror, because 4 page 6 in the peti tion does not address itself -- 5 MR. JABLON: It may be in error, and I don't want 6 to waste the Board's time in finding the specific page 7 references. But, in any event, I note I quoted explicitly 8 in my reply brief, I believe, the letter which I had sent. 9 And I state here that the Florida Cities believe that it is certainly a reasonable condition of our intervention, do not 10 11 oppose and, indeed, af firmatively seek a condition to our 12 intervention that the construction permit may issue. (, 13 And I state this with regard to the af firma tive 14 part of it, because, as we construe the statute, looking at 15 all the plans for a second, a distinction must be made between lo prelicensing re view, which is dealt' wi th in sections 104 and 17 105 -- I guess 103, 104, and 105 -^ and postlicensing 18 review. 19 And, at least in a sense, the equi ties wi th regard 20 to St. Lucie are colored by the same considerations. Tha t l 21 is, I believe under the standard case law be forn the NRC at i 22 7fest Valley, e t al., we are entitled to late in te rve n tion 23 in any event. But I recogni ze that there are some equities 24 going to the company on this matter. 25 I don't see why the company should be in a worse

7 5 l posi tion with regard to St. Lucie 2 than they would be with ~ ( 2 regard to Turkey Point I and 2 or St. Lucie 1. I believe 3 that the cities raise very serious antitrust claims that 4 nuclear power in the totality of the plants should no t be used 5 as a method of monopoli:ation forcing concen tration. 6 But, on the other hand, because we are bringing 7 that contention to the Board and, I believe, have a right to 8 be heard, I do not perceive a reason why construction cannot 9 go forward. And the Atomic Energy Act certainly gives your Honors suf ficient authority to condition -- I can find the 10 section reference, but it is misplaced in my notes -- 12 CHAIRMAN SMITH: For no'q, at least, you a f firina-(. 13 tively agree that, in the event an antitrust hearirq on S t. 14 Lucie 2 is ordered, that it w;11 not impact upon the issuance 15 of a construction permit? 16 MR. JAB LON: Yes, your Honor. 17 CHAIRM AN SMITH: You also agree that the Board. la that the Commission and the Board and the Nuclear Regulatory 19 Commission Staf f does have the right to accept unanimous 20 acreenent of the parties to tha t effect? 21 MR. JABLON: Yes, your Honor. 22 CH A I R.'.l AN SM ITH : This, I understand, is your 23 understanding, too, Mr. Bouknigh t. You say as much on page b 24 9 of your answer to the petition to intervene. 25 MR. BOUKNIGHT: Ye s, si r. That's the way that I

8 a I read the Wa t e r f ord case and Catawba case. ( 2 Now, I do have a couple of questions. 3 My first question is whether Mr. Jablon's agreement 4 is unconditional. That is, he nede ref erences to in terim 5 relief in his two pleadingst they are now being put aside. 6 And, second, I think the question of whether his 7 consent is irrevocable is very important. I notice you used 8 Just a moment ago the words "for now." You can see what kind 9 of proolem -- CHAIRMAN SMITH: I would like to have tha t put 10 11 back to me. "For now," I recall using it, yes. 12 MR. JAB LON: Just as a point of statutory reference. 13 I was referring to section 183, which allows condition of 14 licenses. 15 Let's see. The two questions were on interim 16 relief and whether the waiver was irrevocable. 17 Well, with regard to the latter point, on the 18 issuance of the construction permit, I would think it would 19 be irrevocable. I suppose the mind can conjure up, if the 20 presicent of Florida Power & Light shot the mayors of all ny 21 cities, maybe some f arfetched things might be triggered. 22 Ple have made or attempted to nuke a good-faith 23 wa iver. Fle so do so. I chn see no reason why the Board L, 24 cannot a ttach that as a condition. 25 My remarks here are being recorded. Yes, I do

7 9 I mean it as irrevocable. I mean it as a commi tment as counsel 2 of.the Florida Cities that the construction permit in St. 3 Lucie 2 should go forward. 4 CHAIRMAN SMITH: Nould you address yourself -- 5 MR. JAB LON: Now, on the inte rim releif, I bclieve 6 the Commission does have authority to issue inte rim relief 7 to preserve the status quo. It we are granted intervention, 8 we plan to file a motion to that effect. 9 Mcwever, I want to make it explicitly clear that 10 any permanent or temporary relie f that we may seek, while 11 it may be te chnically a condition to the license -- and the 12 statutory language makes clear that you can a ttach conditions ( 13 to the license -- hy tha t, I do not mean to suggest tha t la no matter what we ask for, or no ma tter what your Honors 15 may order, that the construction permit shall not go forward, lo nor do I mean to suggest tha t, should you deny the relief we 17 seek, that the construction still should not go forward. 18 CHAIRMAN SMITH: And that your acquiescence to 19 tha t is not in eny way conditioned? 20 MR. J AB LON: Yes, your Honor. 21 CHAIRMAN SMITH: Your acquiescence to the 22 issuance 23 MR. JAB LON: Ye s, your Honor. 24 7Ie ll, I mean I do plan to file a motion, but th a t 25 is not conditional, in the sense th a t if we lose I'm not sayino

10 .S I th a t, theref ore, the construction pe rmi t cannot go forward. 2 The answer to your Honor's question is, ye s ; yes, it is not ( 3 cond it iona l. 4 CHAIRMAN SMITH: Mr. Bouknight? 3 MR. SOUKNIGHT: I think, if I understood hia 6 correctly, he said that it was unconditional. The irrevo-7 cability question, I thought I detected a shif t in the S direction in which he was moving during his remarks. I think 9 it is very important that we be talking about an agreement 10 that is irrevocable, without any qualification whatsoevar. We are talking -- and, of c ourse, you know it is 12 our position that this petition shouldn't be granted in any 13 event. But if we were to be in a position where we were 14 constructing the power plant on the basis of this kind of an ~ 15 agreement, then Florida Power 7, Light Company would have I 16 several hundred people out in the field engaging in l i7 construction activities and a great deal of money involved. 18 And we simply couldn't face a claim of changed circumstances l l 19 a few months down the line as a basis for changing this 20 agreement. 21 CHAIRMAN SMITH: .I ce rtainly can understand the 22 imoortance of your concern to Florida Power & Light. And 23 hecause it i s so importan t', I am permi tting you to push Mr. k. 24 Jablan beyond which normal courtesy would pe rmit, because I l \\ 25 think he has used very strong language in his assurances. l l L

c 7 11 However, it is an important ma tte r, and i f Mr. 2 Jablon would please re spond to Mr. Bouknight's conce rn. -- ( 3 MR. JABLON: On behalf of the Florida Cities, 4 I s ta te, first, that we are not opposed to conditiviing 5 our ir.tervention unquali fiedly upon.our agreement tha t the 6 construction permit shall issue ; second, that we commit 7 ourselves not to seek -- well, we have, your Honor, absolutely 8 no intention whatsoever, unqualifiedly, to seek a cessation 9 of construction, and, indeed, it would be against our ~ 10 in terests to do so. 11 As a practical ma tter, we are hurting. We 12 are hurting by not having access to this power, and we hurt (, 13 ourselves if we delay the plant. In any e vent, I again la repeat in the strongest and most af firmative language I can 15 tha t we seek intervention here. We seek interim and permanen t 16 re l l e.f. We do not seek delay in the construction, and we i 17 are willing to abide by that as a condition of our obtaining inter ention we seek. v 18 the 19 CHAIRMAN SMITH: Would it be fair to state, in 20 addition, that, wi th respect to the interim relie f tha t you l 21 reserve the right to seek, that you waive any right to cause 22 a delay or cessation of the construction of the plan t? 23 MR. JABLON: Yes, your Honor. ( t CHAIRMAN SMITH: That seems to be satisfactory, 24 4 25 Mr. Bouknight.

la 12 I MR. BOUKNIGHT: I think that answers the question ; ( 2 yes, sir. 3 CHAIRMAN SMITH: Mr. Dewe y? 4 MR. DE'/f EY : Your Honor, Mr. Jablon's statemen ts, 5 I originally was not sure, but I think we are now sa tis fied / 6 with his position with respect to later trying to delay the 1 7 .'qnstruction permit. We agree with the Applicant and 8 In ter venor that, in the event that all parties agree 9 that the construction permit may be issued, then, in fact, it 10 may be issued. This was, I believe, stated by the Commi ssion 12 itself in the Waterford decision. That was in footnote 2 13 in 6 AEC 48 at page 49. I believe it is rather clear to me, 14 at least, that that was the holding. So, in the event tha t 15 the Sta f f, the Applicant, and the Intervenor agree that the 16 construction permit can be issued, then we belie ve tha t it 17 can be. 18 At thi s s tage, I have not been specifically 19 authorized by my superiors to state tha t the con s truc tion 20 permit could issue in Ulis particular instance, although I 21 personally believe tha t, if it came down to tha t, we would do 22 th a t. But I have not got that clearance at this pointi but 23 I have no reason to believe tha t we wouldn't get i t. 24 CHAIRMAN SMITH: I won't call upon you, Mr. 25 Chandler, unless you indicate there is a point you wish to

S 13 i i I make. 2 MR. CHANDLER: No, sir. I have no comments. { 3 5 6 7 8 9 10 II 12 f3 l !4 .g IC !7 18 l 19 20 21 22 23 l ( l' 2a 25 l l l t

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I i i 1 UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF FLORIDA 2 I. ~ ~ 3 THE CITY OF GAINESVILLE AND THE GAINESVILLE-ALACHUA COUNTY REGIONAL UTILITIES BOARD, THE 4 LAKE WORTH UTILITIES AUTHORITY, THE UTILITIES COMMISSION OF NEW SMYRNA 3EACH, THE SE3 RING 5 UTILITIES COMMISSION, THE CITIES OF ALACHUA, BARTON, FORT MEADE, HOMESTEAD, KISSIMMEE, 6 MOUNT DORA, NEW3ERRY, SAINT CLOUD, STARKE and TALLAHASSEE, FLORIDA, Plaintiffs, 5 vs. 9 FLORIDA POWER AND LIGHT, 10 ' Defendant. 11 /_ i 12 CASE NO. 79-5101-Civ-JLK 13 a e 14 9250 West Flagler Street Miami, Florida 15 Tuesday, May 12,.1981 16 l~ ' DEPOSITION OF MARSHALL MCDONALD 13 taken before GAIL A3RAMSON, Court Reporter and Notary i 19 P ub lic in and for the State of Florida at Large, pursuant 20 ' to Notice of Taking Deposition filed in the above-styled o1 1 cause. 22 23 e 24 r 25.I l l s I scu Year NATIONAL REPORTING SERVICE s 8 8" I?- MARTY LESHAW wiAMt 98C0:474

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Do you know if the company has ever considered. .i m i 2! destroying or discarding-- i 3 A Who's the company? G FP&L. A Who's the company? 5 G Anyone else in the company. g A I have no way of knowing what everyore else in the company might have considered at any point in time about any 3 subject. g G okay, do you know if counsel for the company ever 10, discussed with any company officials the possibility of tt i t., I disposing, destroying, or otherwise getting rid of documents? L I am not aware of that. i t e, i 8 G Are you familiar with the findings of the Fifth t, Circuit Court in the Gainesville case in 1978? la. ! A Yes. .G i a

t. p MR. GRISBON:

You mean the whole opinion? ' il i MR. GUTTMAN: I'm going to ask him a specific-- l 15 13 l C (3y Mr. Guttman) You read the case, I'm sure? i i A I read the case. 20, j G The Fifth Circuit in that case found that the evidence compelled the finding that FP&L was part of a \\ l l conspira.f, so you are aware of that; correct? g ! b You are not nodding, but I take that-- a,, _4 r A I'm glaring. l , a, J NEW vcAK NATICNAL REPORTING SERVICI d is c:uer sf. M ARTY t.ISH AW ggag seconv=. C F rict A 6 count esposten ...... n s f I

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r .t i.. } 3 , i MR. GRIBSON: What the Fifth Circuit held, we l -a Q \\ 2 ' can't do anything about. l' 3 MR. GUTTMAN: I am not going to beat up the witness 4 in light of that holding and he is not going to beat me l 6 5 up either. g G (By Mr. Guttman) In light of that finding, what specific action, if any, have you taken to insure FP&L's 3 compliance with the antitrust laws? i 9; A I'm not aware that we have ever been guilty of 10, infringing any antitrust laws. G In your view, the Fifth Circuit holding in 1978 it was not a finding that FP&L had infringed on any antitrust 12

3 ;

laws? 't A In my opinion, the views of the Fifth Circuit were 1,, ,0.- incorrect.

,3 The views of the jury who actually saw the evidence; t-observed the witnesses, was correct.

13 G Preserving your dispute with the Fifth Circuit, in 19, light of their holding, what specific action, if any, have 1 20 yu taken to insure FP&L's compliance with the antitrust laws? 3, l l A I'm not aware that we have not been complying with i l the antitrust laws. g {~ ' G Have you ever, as head of FP&L, taken any action or } i engaged in discussions to insure that the ecmpany stays in { ,5,i i 1 s NON YORK NATlCNAL REPCRTING SERVICI f ] is count sr. MARTY LISHAW ggggg q

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{ e 2 A Yes, sir. I have never agreed that there is any s_ 3 obligation to share the output of our nuclear plants, but i1 since there is a theory that there is one, at the ti=e that 4 1 J 5-we did not accept a participation in the South Dade Plant, g I directed Mr. Gardner and Mr. Danese to offer to the rest -[ of the State all that I could speculate that this other 3 position might encompass which was our ability to find a I 9' site for a plant, license that site and construct the plant 10 and to offer these services at a reasonable service fee to it the other electrical systems in the State. 12 G In addition to the Central Florida project, if we i 13 can refer to it by that name, what other action have you 1 14l taken to insure or preserve your compliance with the ant-15, trust laws? w 'I A I have had no target to aim for because I do not t, believe that we have infringed on any antitrust laws. 13 G Does FP&L have any program or similar type of f 1 19 l activity under different names by which it instructs its i ,0 : e=ployees as to what the antitrust laws are and what i L obliga tio n the company might have? i 21 A I don't think so. 3_0 o G Now, this also may be a cause for a glare, but this g hr, is--please, for the record, at footnote 14 at the Gainesville i o <, s l 25 decision which you =cy recall, the officials of the power l \\./ { f NON YORK NATIONAL REPCRilNG SERVICE l is cou=f s. MARTY LESMAW mam ...m,.... o,,iem ccuor ceoer f ,,,,,.,,.m,,

i I 4 1,-,s, t 5 t l companies deny the existence of a territorial agreement. l 1 o 2 f Then the court goes on to say, "Where such testi-6 i 3 l =ony is in con:llct with contempraneous documents, we can { ! give it little weight." 4 } 3 Do you recall reading that? ,1 A I'm sure I read it. I don't recall it. G Do you recall Opinion No. 57, the Federal Power .t I Cotnission? It was a decision in the case where the company a sought to revise its tariff. g I 10 Do you recall any opinion-- do you recall in 1977 the company sought to limit eligibility under its tariff? tt De vou recall that? t. A I seem to recall there was something like chat, Mr., ( i 13 :i ] l a l Gutt =an, but I don't.know. I don't recall any specifics l4 i about it. i l la. I igj G If there was something like that, would you have i. I been apprised of it or required to approve it? i ~ l l A No. l l 13] MR. GRIS3ON: A c..c r o v e the decision? ,9 MR. GUTTMAN: Approve the filing. I was referring 3 to the filing. 3 I 4 "ur WITNESS: To approve the filing? 22 1

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Mr. Gardner I only have one question. What is i the liklihood, in your opinion that FP&L will reactivate its offer to purchase Vero Beach power? The plant, the system? Gardner Well, John and I were talking about that a little bit before. I warned him somebody might ask him that question. Gardner I don't think there's much liklihood of the reactivation of the arrangement that we had in 1976 and 7 in that same form. I think that there is at least a glimmer of possibi-lity that other arrangements might be worked out if depending on what y'all's objectives were and what your desire I'm saying that depending on what you really wanting to were. accomplish is I think that the in addition to the antitrust problems there was some vulnerability to the arrange-ment that we had before. I'm just speaking of my own personal assessment of that. The problem two standpoints. One is the substitution of private capital and its costs for municipals capital may have cost. And the other was a merger of the rates of the two systems. If we could find acceptable ways around those problems, it may be possible to and if Vero Beach's I desires simply to not have the concerns of managing a system, think it may be possible to put some arrangements together. I have not given it a great deal of thought only a cursory thought, but if you want to explore it, we'd be happy to do so. L a --e .,n ,-v -~

2-r n Bob, what I thought I heard you say earlier was that every since our aborted day with Justice, Dave and I were there, so was Tom, everybody, that you have in fact been taking care of those so-called 10 conditions that they said would be something you'd have to agree to in order for them to withdraw from the FERC proceeding. Now if what I'm hearing you say is that you have or are dealing with those ten conditions then the next question is if we went back to FERC tomorrow with a similar arrangement by mutual agreement, would Justice stay out of it? Gardner I don't know. We have'nt really talked to them directly about Ehat question yet. Well, I wouldn't think that this would be the time to be talking to Ehem about it. I Gardner Well, that's mainly the reason we haven' t talked to them. f L 1 D __-y_, -e- . 7 _y y-.-~_ ..-.,y ,.y

UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION E In the Matter of ) ) FLORIDA POWER & LIGHT COMPANY ) Docket No. 50-389A ) (St. Lucie Nuclear Power Plant, ) July 27, 1981 Unit No. 2) ') CERTIFICATE OF SERVICE I hereby certify that copies of the foregoing " FLORIDA CITIES' ANSWER TO ' MOTION OF FLORIDA POWER & LIGHT COMPANY EUR DECLARATORY ORDER, OR IN THE ALTERNATIVE TO DISMISS THE FLORIDA CITIES FROM THE PROCEEDING'" was served upon the following persons by hand deliver (*) or by deposit in the U. S. Mail, first class, postage prepaid this 27th day of July 1981. Ivan W. Smith, Esq., Chairman Michael C. Farrar, Esq. Atomic Safety and Licensing Board Atomic Safety and Licensing Nuclear Regulatory Commission Appeal Board Washington, D. C. 20555 Nuclear Regulatory Commissior. Washington, D. C. 20555 Michael A. Duggan, Esq. College of Business Richard E. Salzman, Esq. Administration Atomic Safety and Licensing University of Texas Appeal Board Austin, Texas 78712 Nuclear Regulatory Commission Washington, D. C. 20555 Robert M. Lazo, Esq. Atomic Safety and Licensing Board "onald A. Kaplan, Esq. Nuclear Regulatory Commission Robert Fabrikant, Esq. Washington, D. C. 20555 Antitrust Division Department of Justice Joseph Rutberg, Esq. Washington, D. C. 20530 Antitrust Counsel Nuclear Regulatory Commission J. A. Bouknight, Jr., Esq. Washington, D. C. 20555 Lowenstein, Newman, Reis & Axelrad Jerome D. Saltzman, Chief 1025 Connecticut Avenue, N. W. Utility Finance Branch Washington, D. C. 20036 Nuclear Regulatory Commission Washington, D. C. 20555 John E.

Mathews, Jr.,

Esq. Mathews, Osborne, Ehrlich, Jerome E. Sharfman, Chairman McNatt, Gobelman & Cobb r Atomic Safety and Licensing Appeal 1500 American Heritage Life Board Building Nuclear Regulatory Commission Jacksonville, Florida 32202 Washington, D. C. 20555

l ' r William C. Wise, Esq. Reubin O. D. Askew 1200 18th Street, N. W. Greenberg, Traurig, Askew, Suite 500 Hoffman, Lipoff, Quentel 6 Washington, D. C. 20036 & Wolff, P.A. 1401 Brickell Avenue William H. Chandler, Esq. Miami, Florida 33131 Chandler, O'Neal, Avera, Gray, Lang & Stripling Robert R. Nordhaus P. O. Drawer 0 Van Ness, Feldman, Sutcliffe, Gainesville, Florida 32602 Curtis & Levenberg 1050 Thomas Jefferson St., N.W. Daniel H. Gribbons, Esq. 7th Floor Herbert Dym, Esq. Washington, D. C. 20007 Covington & Burling 888 16th Street, N. W. Janet Urban, Esquire Washington, D. C. 20036 Department of Justice P. O. bux 14141 Florida Power & Light Company Washington, D. C. 20044 ATTN: Dr. Robert E. Uhrig Vice President

• Chase Stephens, Chief Advanced Systems & Technology Docketing & Service Section P.

O. Box 529100 Nuclear Regulatory Commission Miami, Florida 33152 Washington, D. C. 20555 h k ~ RoFert A. Jable: ? _ _ _ _ _ _ _ _ _ - _. _ _ - _ _ _ _ _ _ - _}}