[Senate Hearing 114-336]
[From the U.S. Government Publishing Office]


                                                        S. Hrg. 114-336

                   OVERSIGHT HEARING: THE PRESIDENT'S
                  FISCAL YEAR 2017 BUDGET REQUEST FOR
                   THE NUCLEAR REGULATORY COMMISSION

=======================================================================

                                HEARING

                               before the

                              COMMITTEE ON
                      ENVIRONMENT AND PUBLIC WORKS
                          UNITED STATES SENATE

                    ONE HUNDRED FOURTEENTH CONGRESS

                             SECOND SESSION

                               __________

                             APRIL 6, 2016

                               __________

  Printed for the use of the Committee on Environment and Public Works
  
  
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               COMMITTEE ON ENVIRONMENT AND PUBLIC WORKS

                    ONE HUNDRED FOURTEENTH CONGRESS
                             SECOND SESSION

                  JAMES M. INHOFE, Oklahoma, Chairman
DAVID VITTER, Louisiana              BARBARA BOXER, California
JOHN BARRASSO, Wyoming               THOMAS R. CARPER, Delaware
SHELLEY MOORE CAPITO, West Virginia  BENJAMIN L. CARDIN, Maryland
MIKE CRAPO, Idaho                    BERNARD SANDERS, Vermont
JOHN BOOZMAN, Arkansas               SHELDON WHITEHOUSE, Rhode Island
JEFF SESSIONS, Alabama               JEFF MERKLEY, Oregon
ROGER WICKER, Mississippi            KIRSTEN GILLIBRAND, New York
DEB FISCHER, Nebraska                CORY A. BOOKER, New Jersey
MIKE ROUNDS, South Dakota            EDWARD J. MARKEY, Massachusetts
DAN SULLIVAN, Alaska

                 Ryan Jackson, Majority Staff Director
               Bettina Poirier, Democratic Staff Director
                            
                            
                            
                            
                            
                            C O N T E N T S

                              ----------                              
                                                                   Page

                             APRIL 6, 2016
                           OPENING STATEMENTS

Inhofe, Hon. James M., U.S. Senator from the State of Oklahoma...     1
Boxer, Hon. Barbara, U.S. Senator from the State of California...     3
Sanders, Hon. Bernard, U.S. Senator from the State of Vermont, 
  prepared statement.............................................   302

                               WITNESSES

Burns, Stephen, Chairman, U.S. Nuclear Regulatory Commission.....    11
    Prepared statement...........................................    13
    Responses to additional questions from:
        Senator Inhofe...........................................    27
        Senator Vitter...........................................    75
    Response to an additional question from Senator Barrasso.....    82
    Responses to additional questions from:
        Senator Rounds...........................................    83
        Senator Sanders..........................................    87
        Senator Fischer..........................................    95
        Senator Crapo............................................   104
        Senator Sessions.........................................   136
Svinicki, Kristine, Commissioner, U.S. Nuclear Regulatory 
  Commission.....................................................   277
    Prepared statement...........................................   278
    Responses to additional questions from Senator Inhofe........   279
Ostendorff, William, Commissioner, U.S. Nuclear Regulatory 
  Commission.....................................................   280
    Responses to additional questions from Senator Inhofe........   281
Baran, Jeffrey, Commissioner, U.S. Nuclear Regulatory Commission.   283
    Response to additional questions from Senator Inhofe.........   284

 
OVERSIGHT HEARING: THE PRESIDENT'S FISCAL YEAR 2017 BUDGET REQUEST FOR 
                   THE NUCLEAR REGULATORY COMMISSION

                              ----------                              


                        WEDNESDAY, APRIL 6, 2016

                                       U.S. Senate,
                 Committee on Environment and Public Works,
                                                    Washington, DC.
    The committee met, pursuant to notice, at 10:02 a.m. in 
room 406, Dirksen Senate Office Building, Hon. James M. Inhofe 
(chairman of the committee) presiding.
    Present: Senators Inhofe, Boxer, Barrasso, Capito, Crapo, 
Boozman, Wicker, Fischer, Rounds, Carper, Cardin, Gillibrand, 
Booker, and Markey.

          OPENING STATEMENT OF HON. JAMES M. INHOFE, 
            U.S. SENATOR FROM THE STATE OF OKLAHOMA

    Senator Inhofe. I would like to begin by welcoming all four 
commissioners here. I appreciate it.
    And I say particularly to you, Commissioner Ostendorff, I 
understand you are going to be going back to your previous 
duties, less strenuous, I would assume, teaching at the Naval 
Academy. You have had a great background in history and great 
contributions to this committee. We will miss you. We will all 
miss you sitting out there.
    By the way, right now there are two vacancies. Mrs. Jessie 
Roberson is one of them that has been nominated. These are 
partisan nominations, so that would be a Democrat slot. What we 
have always done in the past we will attempt to do again now, 
is to pair with a Republican, and we are hoping we will be able 
to do that. We are in contact right now with the White House to 
try to accommodate that, because I would hate to have to try to 
operate with just three commissioners.
    Barbara is here.
    Senator Boxer. Good morning, Jim.
    Senator Inhofe. Good morning, Barbara.
    So, anyway, that is what our intention will be. And we are 
going to ask, also, as I did individually with you, since we 
have a vote at 11, that means we can stay here until 11:15. I 
think if everyone stays within the time limit, that will work, 
and that is what we will be asking our members to do.
    The NRC requested $982 million in budget authority for 
fiscal year 2017, down slightly from fiscal year 2016. The 
NRC's safety mission is a critical one, but it accomplished its 
mission with significantly fewer resources in the past.
    Following 9/11 the NRC's budget grew to address rising 
security concerns. Around 2006 it started growing to address 
growth in nuclear energy. Unfortunately that growth hasn't been 
as robust as we thought. In fact, we have seen five reactors 
close in recent years, and at least three more will be closed 
by 2019. The NRC's budget remains significantly higher.
    So what I am saying is we raised the budget anticipating 
greater activity out there, and that didn't happen. But it is 
very typical of a government agency to maintain that same size. 
So we have a chart. What I am saying is right here, if you look 
at the increases, and then you look at the workload, the 
workload is going down, money is going up, and this is not the 
first time in Government that that has happened. So I am 
concerned about this.
    As a result of Project Aim, the NRC staff has proposed to 
the Commission an additional $31 million in cost savings for 
next year. That is good, but that is not enough.
    Now, back then I talked to Barbara about what happened in 
1998. At that time we had actually gone 4 years without any 
oversight, and that is something that doesn't work. So at that 
time the stakeholders identified several areas for improvement 
in the Commission meeting and before this Committee, and I was 
there at the time, and I remember it well.
    Those recommendations were five: the timely and fiscally 
responsible review of the licensing actions; stricter 
application of the Backfit Rule; the systematic application of 
a clear standard of safety significance in regulatory 
decisionmaking rather than vague terms such as enhanced 
defense-in-depth; more disciplined use of Requests for 
Additional Information, or RAIs; and the need for an objective, 
quantitative assessment of safety performance.
    You may have noticed that this committee has either written 
or requested the Commission on all these subjects in the last 
year. It appears that many of the inefficiencies that plagued 
the NRC in the 1990s have returned, and that is what we have 
been talking about.
    Back then, in response to congressional oversight Chairman 
Shirley Ann Jackson held a meeting with stakeholders to delve 
into their concerns. She followed with a memo tasking agency 
staff with developing a plan to address those concerns and 
others raised by this committee.
    The Executive Director, Joe Callan, seized her challenge, 
and his routine progress reports became legendary examples of 
the agency's self-improvement capability and responsiveness. 
All of this transpired under 3 months.
    In 1998, in my first NRC hearing as subcommittee chairman 
an industry witness testified, ``Just as the industry has made 
a significant transition in the way it operates in a 
competitive market, the NRC must replace an outdated, 
ineffective regulatory framework with one that is objective, 
safety-focused, and responsive,'' and it did.
    The nuclear industry once again faces challenges in the 
marketplace, and once again the need for the NRC to be an 
objective, safety focused, and responsive regulator is 
imperative, and Chairman Burns, I urge you to take a page out 
of Chairman Jackson's playbook and tackle these challenges.
    Senator Boxer.
    [The prepared statement of Senator Inhofe follows:]

                  Statement of Hon. James M. Inhofe, 
                U.S. Senator from the State of Oklahoma

    I'd like to begin by welcoming the four commissioners, but 
especially Commissioner Ostendorff who will leave the 
Commission in June to once again take up teaching at the U.S. 
Naval Academy. Bill, your service at the NRC came during some 
tough times. I personally appreciate your service.
    By July 1st, there will be two vacancies at the Commission. 
Mrs. Jessie Roberson was nominated for the open seat. I have 
met with the nominee as have many other members of the 
committee. Before moving forward with her nomination, it is 
important to know the White House's intentions on the open 
seat. The NRC has partisan seats, and pairing the nominations 
informs the committee members' decisions.
    We will continue with the committee's practice of a 5-
minute opening statement from Chairman Burns and 2 minutes for 
each of the commissioners.
    The NRC requested $982 million in budget authority for 
fiscal year 2017, down slightly from fiscal year 2016.
    The NRC's safety mission is a critical one, but it 
accomplished its mission with significantly fewer resources in 
the past.
    As a result of Project Aim, the NRC staff has proposed to 
the Commission an additional $31 million in cost savings for 
next year.
    While this is a step in the right direction, I believe the 
Commission should move beyond incremental savings and examine 
its budget and regulatory processes more fundamentally.
    The NRC can do better. I've seen it do better. 
Unfortunately, the situation we are witnessing now reminds me 
of the late 1990s.
    Back then, stakeholders identified several areas for 
improvement:
     The timeliness and fiscally responsible review of 
licensing actions;
     Stricter application of the Backfit Rule;
     Systematic application of a clear standard of safety 
significance in regulatory decisionmaking rather than vague 
terms such as ``enhanced defense-in-depth'';
     More disciplined use of Requests for Additional 
Information, or RAIs; and
     The need for an objective, quantitative assessment of 
safety performance.
    You may have noticed that this committee has either written 
or questioned the Commission on all of these subjects in the 
last year. It appears that many of the inefficiencies that 
plagued the NRC in the 1990s have returned.
    Back then, in response to congressional oversight, Chairman 
Shirley Ann Jackson held a meeting with stakeholders to delve 
into their concerns. She followed with a memo tasking agency 
staff with developing a plan to address those concerns and 
others raised by this committee.
    The Executive Director, Joe Callan, seized her challenge, 
and his routine progress reports became legendary examples of 
the agency's self-improvement capability and responsiveness.
    All of this transpired in under 3 months.
    In 1998, an industry witness testified: ``Just as the 
industry has made a significant transition in the way it 
operates in a competitive market, the NRC must replace an 
outdated, ineffective regulatory framework with one that is 
objective, safety focused and responsive.''
    The nuclear industry once again faces challenges in the 
market place, and once again the need for the NRC to be an 
objective, safety focused, and responsive regulator is 
imperative.
    Chairman Burns, I urge you take a page out of Chairman 
Jackson's playbook and tackle these challenges.

           OPENING STATEMENT OF HON. BARBARA BOXER, 
           U.S. SENATOR FROM THE STATE OF CALIFORNIA

    Senator Boxer. Thank you.
    I would like to welcome the commissioners here.
    There are many important topics facing us, including 
implementing post-Fukushima safety improvements, ongoing 
efforts to cut costs, and the Commission's work on 
decommissioning reactors such as the San Onofre Nuclear 
Generating Station in my home State.
    Today's hearing comes more than 5 years after the Fukushima 
tragedy. The people in Japan continue to suffer from the 
consequences of this disaster. It may be pleasant not to look 
at it, but we better look at it.
    A study released in October 2015 and published in the 
journal Epidemiology found that children living near the site 
of the Fukushima meltdown have been diagnosed with thyroid 
cancer at a rate 20 to 50 times that of children elsewhere. 
Also, in October Japan's Health Ministry announced the first 
confirmed case of cancer in a Fukushima recovery worker. These 
reports do not inspire confidence.
    Just last month the Gallup Poll showed that for the first 
time a majority of U.S. adults, 54 percent, opposed nuclear 
power.
    I have been saying over and over again since Fukushima, in 
order to earn the confidence of the American public and win 
them over, the nuclear power industry must do everything it can 
to avoid similar disasters, and so must you. That is why it is 
so critical to address post-Fukushima safety recommendations 
that were identified by the Fukushima Near-Term Task Force in 
2011.
    While I recognize that progress has been made on some of 
the recommendations I remain concerned that not one--not one--
of the 12 Task Force recommendations has been fully 
implemented, and many have been closed without any action at 
all.
    We will share with you this chart. Sadly, it is the same 
darned thing I held up months ago. What are you folks doing 
over there? You have a majority of the people against nuclear 
power for the first time in a long time. People believe nuclear 
should be part of the mix if it is safe.
    So you have reports out of Japan; you had your task force 
tell you what to do. I will tell you if the Congress did that, 
we would all be voted out if we were expected to take certain 
steps. I don't understand it. So I am going to ask you about 
it.
    Now, in addition to this, the non-action over here, the 
Commission recently approved an NRC staff proposal to close out 
numerous lower priority recommendations without taking any 
action to implement safety improvements. This approach ignores 
the serious safety concerns raised in the wake of Fukushima.
    I am concerned that the efforts to reduce your budget would 
undermine safety if they are not implemented carefully, those 
cuts. The staff recently provided the Commission with a paper 
outlining 151 recommendations for cutting costs. Unfortunately, 
some of these recommendations would reduce or eliminate 
important safety initiatives, including new limits on 
inspections at nuclear plants.
    If we want to convince the American people, again, that 
they are wrong on nuclear power, that it can be done safely, 
this is the worst way to go about it I have heard. I don't get 
it. I really don't, in all sincerity.
    The Commission has to live up to its mission ``to ensure 
the safe use of radioactive materials for beneficial civilian 
purposes while protecting people and the environment.'' One 
mess-up in any one of these power plants, and it is over for 
the nuclear power industry. I hope everyone understands that, 
with this news coming out of Fukushima.
    Finally, I want to highlight challenges at the two nuclear 
power plants in my home State. My people there are telling me 
they are very concerned that Diablo Canyon cannot withstand 
earthquakes that could occur in the area. Despite evidence in 
recent years of increased seismic risk at the plant, the NRC is 
proceeding merrily along the way with the relicensing process 
for this plant and has failed to take action to address seismic 
safety concerns. My people are at a loss to understand it.
    And at the San Onofre Nuclear Plant, which is closed 
permanently, there are many concerns about public safety during 
the decommissioning process. As I stated at our October 
hearing, I disagree with NRC's approval of exemptions to 
emergency planning requirements. Why would you do that with so 
many people living so close to this plant?
    Because of this exemption, the plant's operator will no 
longer be required to maintain detailed plans for the 
evacuation, sheltering, and medical treatment of people 
residing in the 10-mile zone. This is troubling. You know how 
populated the area is, and there are thousands of tons of 
extremely radioactive spent fuel remaining at the site and 
millions of people, millions living in close proximity.
    So, in closing, and I will close in 10 seconds, you cannot 
be a rubber stamp for exemptions from the nuclear industry. 
That is not your job. That is counter to your job. And I think 
you owe it to the citizens of my great State and the Nation to 
make safety your highest priority.
    Thank you.
    Senator Inhofe. Thank you, Senator Boxer.
    Without objection, I want to enter into the record this 
article from Platts entitled Nuclear safety upgrades post-
Fukushima cost $47 billion, a very complimentary article to you 
folks.
    [The referenced information follows:]
    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT] 
    
    Senator Inhofe. Mr. Chairman, if you would begin. And I am 
going to ask you all to try to stay within your time.

             STATEMENT OF STEPHEN BURNS, CHAIRMAN, 
               U.S. NUCLEAR REGULATORY COMMISSION

    Mr. Burns. Thank you, Chairman Inhofe and Ranking Member 
Boxer and other members of the committee. We appreciate the 
opportunity to appear before you this morning to provide an 
update on the fiscal year 2017 budget request and the agency's 
current regulatory activities.
    As we said, the NRC is an independent agency established to 
license and regulate the civilian use of nuclear and 
radioactive materials in the United States and ensure adequate 
protection of the public health and safety to promote the 
common defense and security and protect the environment. The 
resources we are requesting will allow the NRC to continue to 
carry out our important mission.
    The proposed 2017 budget is $970 million and 3,462 FTE, 
full-time equivalent staff, excluding the Office of the 
Inspector General. The proposal represents a net decrease of 
nearly $20 million and 90 FTE from the fiscal year 2016 enacted 
budget. The request reflects a decrease of approximately $74 
million and 280 full-time equivalent employees from the 2014 
enacted budget.
    The inspector general component of the 2017 budget is $12 
million.
    Consistent with the Omnibus Budget Reconciliation Act, our 
2017 request provides for 90 percent fee recovery, resulting in 
a net appropriation of $121 million. This appropriation is an 
increase of $2 million compared with the 2016 enacted budget 
due to the inclusion of $5 million in non-fee recoverable 
resources for advanced nuclear reactor technology.
    Our 2017 budget request reflects our continuing focus on 
our important mission while continuing our Project Aim 
initiative. We are concluding the review of the re-baselining 
paper that outlines an additional 150 activities that could be 
eliminated or reduced without an impact on safety, for a 
savings of about $41 million in 2017, of which $10 million has 
already been reflected in the fiscal year 2017 President's 
budget request.
    We cannot emphasize, however, strongly enough that while we 
expect to be a smaller agency as a reflection of workload 
reductions and efficiency gains, the need for the great 
majority of the services that we provide the American people 
remains unchanged. As we proceed the agency remains mindful of 
the importance of its highly skilled technical staff and the 
need to maintain our expertise. We must keep a focus on 
knowledge management as senior staff retire and new experts 
take their place.
    I want to highlight one area the Commission is attending 
to: improving our rulemaking process. The Commission has 
revised its processes to improve its understanding of, and 
where possible to reduce the cumulative effects of regulation. 
In addition, the Commission has recently directed the staff on 
a proposed plan to better define and enhance the Commission's 
role in the early stages of rulemaking, before significant 
resources are expended.
    The Commission is also considering a proposal to establish 
a single unified approach to tracking rulemaking activities so 
the public and stakeholders have real-time access to current 
information.
    We carry out our safety and security activities through two 
major programs: nuclear reactor safety, which includes 
operating reactors and new reactors; and nuclear materials and 
waste safety, consisting of fuels facilities, nuclear materials 
users, decommissioning and low level waste, spent fuel storage, 
and transportation.
    Our request in the operator reactors business line 
represents a decrease of $1.7 million from the 2016 enacted 
budget.
    These resources that we request will help with 
implementation of lessons learned from the Fukushima Daiichi 
accident in Japan. The requested resources support the 
continued implementation of the most safety significant, or 
Tier 1, enhancements that were identified after Fukushima, 
including implementation of our orders on mitigation 
strategies, spent fuel instrumentation, and severe-accident-
capable hardened vents, and completion of the mitigation of 
beyond-design-basis events rulemaking.
    The bulk of the most safety significant enhancements for 
post-Fukushima should be completed in this year, calendar year 
2016. We expect to bring to closure our evaluation of the 
longer term Tier 2 and Tier 3 issues. We will inspect the work 
that has been done and ensure plants maintain their progress. 
We strongly believe that the United States' plants are better 
prepared for extreme events now than they were in 2011.
    On a related note, the NRC recently issued letters to the 
Nation's commercial operating plants about their 2015 
performance. While the vast majority fully met safety and 
security performance objectives, three reactors at two sites, 
Arkansas Nuclear and Pilgrim, were deemed to be in the fourth 
or lowest performance category.
    To wrap up, we have requested in our budget to cover some 
new reactor activities, including the review of the small 
modular reactor design expected from NuScale, and we have asked 
for $5 million in non-fee activities to cover development of 
image structure for advanced reactors.
    I thank you for the opportunity to appear, and we would be 
pleased to answer your questions.
    [The prepared statement of Mr. Burns follows:]
    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT] 
    
    Senator Inhofe. Thank you, Mr. Chairman.
    Commissioner Svinicki.

         STATEMENT OF KRISTINE SVINICKI, COMMISSIONER, 
               U.S. NUCLEAR REGULATORY COMMISSION

    Ms. Svinicki. Thank you, Chairman Inhofe, Ranking Member 
Boxer, and distinguished members of the committee for the 
opportunity to appear before you today at this hearing on NRC's 
fiscal year 2017 budget request and associated matters. Our 
Chairman, Stephen Burns, in his written statement on behalf of 
the Commission, has provided an overview of the agency's budget 
request as well as a description of several ongoing activities 
that are central to carrying out NRC's important work.
    I thank the committee for its consideration of our budget 
request. In the interest of time, I will ask if I may submit my 
brief oral statement for the record.
    Senator Inhofe. Without objection.
    Ms. Svinicki. Thank you.
    [The prepared statement of Ms. Svinicki follows:]
    
    
    Senator Inhofe. Commissioner Ostendorff.

        STATEMENT OF WILLIAM OSTENDORFF, COMMISSIONER, 
               U.S. NUCLEAR REGULATORY COMMISSION

    Mr. Ostendorff. Good morning, Chairman Inhofe, Ranking 
Member Boxer, and distinguished members of the committee. 
Chairman Inhofe, thank you for your kind remarks. It has been a 
distinct privilege to serve with this group of people for the 
last 6 years.
    I am in complete alignment with Chairman Burns' testimony. 
I will make two specific comments.
    First, as mentioned by the Chairman, the Commission's 
recent decision to provide direction to the staff to seek 
Commission approval before embarking upon rulemaking activities 
is a significant change and a major step toward improving 
efficiency. Second, our budget requests $5 million in non-fee 
billable resources to further develop our regulatory 
infrastructure to review advanced, non-light reactor technology 
applications. It is very important for the long-term health of 
the NRC and the nuclear industry that we retain the ability to 
license new reactor technologies.
    In closing, I completely agree with Chairman Inhofe's 
comment that these oversight hearings are of extreme 
importance.
    Thank you.
    [The responses of Mr. Ostendorff to questions for the 
record follow:]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT] 


    Senator Inhofe. Well, thank you very much, and again, good 
luck at the academy.
    Commissioner Baran.

           STATEMENT OF JEFFREY BARAN, COMMISSIONER, 
               U.S. NUCLEAR REGULATORY COMMISSION

    Mr. Baran. Chairman Inhofe, Ranking Member Boxer, members 
of the committee, thank you for the opportunity to testify 
today. It is a pleasure to be here with my colleagues to 
discuss NRC's fiscal year 2017 budget request and the work of 
the Commission.
    With respect to Project Aim, I have been very impressed by 
the willingness of the NRC staff to take a hard, questioning 
look at what work the agency is doing and how we are doing that 
work. The NRC staff has generated a list of 151 proposals that 
would reduce costs in the coming months. The Commission is 
deliberating on those now. I think the vast majority of these 
items make a lot of sense, but I have concerns about several 
items, including a few that would reduce inspection hours.
    In my view, Project Aim should not be about relaxing 
regulatory oversight of licensee performance and safety. On 
March 22 I traveled to Fukushima Daiichi to take a firsthand 
look at conditions at the site. The scale and decades long 
duration of the clean up effort there are a sobering reminder 
of the need to learn and implement the lessons of Fukushima.
    Last month marked 5 years since the accident in Japan. It 
is a natural time to take stock of where we are. I think it is 
clear that we have made significant progress but still have a 
lot of work left to do.
    Decommissioning is another important issue for NRC, as the 
Chairman mentioned. In the last few years, five U.S. reactors 
have permanently shut down, and three more have announced plans 
to do so in the near term. I see two main purposes for the 
decommissioning rulemaking effort that is now underway, and 
both are important.
    First, it will allow NRC to move away from regulating by 
exemption in this area. The exemption approach isn't efficient 
for anyone, and it provides no opportunity for public comment. 
Second, the rulemaking provides a chance for NRC and all of our 
stakeholders to take a fresh look at our decommissioning 
process and requirements. We need to thoughtfully consider 
stakeholder ideas with an open mind.
    There are, of course, a number of other important efforts 
underway, including small modular reactors coming up, and the 
proposal for advanced reactor funding. We are happy to discuss 
these and any other issues of interest.
    Thank you, and I look forward to your questions.
    [The response of Mr. Baran to questions for the record 
follow:]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT] 

    Senator Inhofe. Thank you, Commissioner Baran.
    I will begin, and I have three questions, all three for 
Chairman Burns. The first two questions just require a yes or 
no answer, and I think you may be already starting in on the 
areas that I am going to suggest here. The last one you will 
probably want to elaborate just a little bit.
    First of all, I referred several times to the then Chairman 
Shirley Jackson. When she testified before this Committee, this 
would have been 1998, the time that I have been referred to, I 
am quoting now: ``The NRC has been the subject of a number of 
external reviews, some of them sharply critical. Whether or not 
one agrees with these criticisms, we believe that they are 
worthy of careful consideration. The Commission invited a 
number of these stakeholders, including some of the harshest 
critics, to engage in a roundtable discussion open to the NRC 
staff, the press, and the public. As anticipated, the meeting 
provided the Commission with beneficial insights, including a 
range of perspectives on the strengths and weaknesses of NRC 
regulatory programs and policies.''
    Chairman Burns, would you commit to holding a stakeholders 
meeting within the next 3 months?
    Mr. Burns. Yes, I would be willing to do that. I do meet 
with stakeholders across the spectrum.
    Senator Inhofe. Good.
    Mr. Burns. But I would be willing to meet with----
    Senator Inhofe. I appreciate that.
    Now, following the 1998 hearing, Chairman Jackson tasked 
the NRC's executive director with action on a set of high 
priority tasks identified in the stakeholders meeting, the one 
that we referred to, and by this committee. The executive 
director responded in less than a month with a plan to address 
an issue that had been raised.
    Chairman Burns, would you commit to task your executive 
director and report your progress to this committee let's just 
say every couple months?
    Mr. Burns. Yes, I would do that. I want to consult with my 
colleagues, the fellow commissioners, and provide some 
direction. I think we probably can get some other ideas----
    Senator Inhofe. Would any of the other three commissioners 
object to this request that I am making? All right.
    And last, Chairman Jackson's single most important reform 
was to transition the agency from subjective, inconsistent 
assessments of nuclear plant safety to the current reactor 
oversight program, which is based on objective, measurable 
performance indicators. However, I understand there has been 
some of the staff backsliding on this.
    So, Chairman Burns, how will the Commission exercise its 
oversight of the staff to ensure the reactor oversight process 
is not compromised by undue subjectivity?
    Mr. Burns. We have been engaged with the staff on the 
reactor oversight process. There are some aspects I think they 
are looking at. They are engaging with stakeholders now on 
that. I would expect the Commission to be informed about that. 
To the extent that there are changes that require Commission 
endorsement or approval, that those be provided to us and we 
have an understanding what the different viewpoints are. So I 
think as part of our normal process we would do that.
    Senator Inhofe. OK. I have another minute and a half. 
Anyone want to comment on that, of the other three 
commissioners?
    Mr. Baran. I would just add that I think the staff takes 
very seriously the rigor that we have right now in the reactor 
oversight process; they are very conscious of that. So it is 
something that the Commission is focused on, we are talking 
with the staff about, but I think it is something that the 
staff is very clear that they want to maintain the rigor of the 
reactor oversight.
    Senator Inhofe. You know, when I say it could be that 
reports we have gotten are not all that accurate, but we 
understand that there has been some resistance to this, and I 
would just ask you to do what you can to eliminate that.
    Any comments on that?
    Ms. Svinicki. Chairman Inhofe, I agree with the Chairman 
and Commissioner Baran. The Commission has been engaging rather 
actively with the staff as they develop any proposals to modify 
this process. Although there may be modest adjustments that are 
within their authority to make if something has a significant 
impact to the program, I am certain that the Commission would 
want to put its imprimatur on that.
    Senator Inhofe. OK. And let me be clear. Our situation 
today is not analogous to what it was in 1998. In 1998, having 
gone 4 years without an oversight, that was a pretty extreme 
time. And though this is not the case now, there are some 
indicators that there has been a more relaxed attitude than 
there should be.
    Thank you very much.
    Senator Boxer.
    Senator Boxer. Thank you so much.
    I want to follow up on this meeting with stakeholders. How 
do you define stakeholders, Mr. Burns?
    Mr. Burns. I think that was our members of non-governmental 
organizations, members of industry, licensees that can be local 
groups.
    Senator Boxer. Community groups?
    Mr. Burns. It is a wide variety.
    Senator Boxer. Good. Because this is not just a meeting 
that the Chairman is asking for you to have with the industry; 
it is the industry, it is the non-profit groups, it is the 
community groups, is that correct?
    Mr. Burns. That is correct.
    Senator Boxer. Good. That is good.
    Mr. Burns. And part of what I do, for example, I am meeting 
with an NGO tomorrow on some of their concerns. I meet with a 
lot of people.
    Senator Boxer. Good. That is good. Well, to me it is not 
about a lot of people; it is about stakeholders, you know. And 
I agree meeting with stakeholders, as long as it is everyone, 
and meeting with them at the same time is critical. It builds 
confidence all around.
    And specifically on that, I would like to arrange a meeting 
with you and the stakeholders in San Onofre, as well as Diablo. 
That would include the operator of the power plant, the 
concerned community, the citizens around there, the 
environmentalists around there as well. Could we work together 
on that?
    Mr. Burns. Certainly, Senator.
    Senator Boxer. And I would love it as many commissioners 
could attend would be great. It is not just meant to be for the 
chairman; he has a lot on his shoulders. So any one of you that 
wants to be at that meeting. And I will organize that and get 
back to you.
    I wanted to comment on the article that my friend, and he 
is my friend, put in the record, Nuclear safety upgrades post-
Fukushima cost $47 billion. When you read the story, what you 
find out is that 90 percent of that is being spent outside the 
United States of America, most of it in Japan because of the 
disaster and the turning up now of these diseases. So I wanted 
to point out that our nuclear industry is quoted in the story 
as saying the industry has managed its response to Fukushima 
while avoiding costly new requirements.
    So I just wanted to circle those points in the story. And I 
am glad the story is in the record because it proves my point 
that what is happening here is just not moving fast enough, 
which leads me to the last part of my questioning.
    I think I gave you this, Mr. Burns.
    Mr. Burns. Yes.
    Senator Boxer. And I know that everyone has seen it and 
agreed that it is accurate, but I am going to go through it 
just to show the people, the American people how little is 
really being done post-Fukushima.
    Almost 4 years ago, your Commission, your task force laid 
out these 12 ideas. They were senior members of the NRC staff. 
I don't know who is still there. If I was working there, I 
would probably quit, given the fact that nothing has been done. 
But it is almost 4 years, so I am going to go through each one 
of these, and all I want from you, Mr. Burns, if you would, is 
if you agree with my analysis of each one, and if you don't, 
explain why.
    No. 1, improve regulatory framework. The NRC rejected staff 
proposals on that, is that correct?
    Mr. Burns. The Commission decided not to proceed with that.
    Senator Boxer. That is what I just said. So the Commission 
said no to the NRC staff proposal on regulatory framework.
    Two, study and upgrade seismic flooding and other hazard 
protections. My understanding is that there is no target date 
set for permanent safety upgrades on seismic flooding or other 
hazards, is that correct?
    Mr. Burns. I am not sure that that is correct. We have 
seismic and flooding analysis from most of the plants.
    Senator Boxer. No, I am asking do you have a target----
    Mr. Burns. In some circumstances there was not a need for 
further seismic and flooding upgrades.
    Senator Boxer. OK. Well, your staff said----
    Mr. Burns. This is important work, and progress is made on 
it.
    Senator Boxer. Whoa, whoa, whoa. Your staff said that there 
needed to be upgrades, study and upgrades seismic flooding and 
other protections. My understanding is you are implementing 
some, but no target date has been set for permanent safety 
upgrades. Now, your staff said that is correct. Is that 
correct?
    Mr. Burns. I am not sure of the context, Senator. I am 
happy to look at that.
    Senator Boxer. Does anyone else understand the context?
    Mr. Baran.
    Mr. Baran. I think it is correct that there is no firm date 
by which any necessary upgrades would be made.
    Senator Boxer. Thank you. So that is accurate.
    Three, upgrade to prevent or mitigate seismically induced 
fires or floods. My understanding is the NRC rejected that 
action. Is that correct?
    Mr. Burns. I think that is correct because we felt it was 
bound by the existing protections that we----
    Senator Boxer. I understand that. All of these are 
improvements, they are not status quo. You rejected, the NRC 
rejected doing this even though your staff, senior staff, after 
Fukushima 4 years ago, said to do it.
    No. 4----
    Mr. Burns. No, what they said to do is to evaluate whether 
that provided an additional benefit.
    Senator Boxer. No, they said to upgrade.
    Mr. Burns. And we have been responsible about doing those 
things.
    Senator Boxer. Upgrade. Upgrades. They want upgrades in the 
plants to prevent or mitigate seismically induced fires or 
floods. You said no.
    Let's move on. Mitigation for events like blackouts. The 
final rule is supposed to be due this year. Is it coming?
    Mr. Burns. Yes.
    Senator Boxer. When?
    Mr. Burns. Toward the end of the year, as scheduled.
    Senator Boxer. Can we say by December?
    Mr. Burns. Yes.
    Senator Boxer. Thank you.
    Mr. Burns. And the plants have already implemented, per 
orders imposed by this Commission in 2012, improvements to 
address this, and in fact went beyond the Near-Term Task Force 
requirements were.
    Senator Boxer. I see I have gone over my time, so I will 
wait for a second round to go through the rest of these. But we 
will ask you the rest of these.
    Senator Inhofe. Thank you, Senator Boxer.
    Senator Rounds.
    Senator Rounds. Thank you, Mr. Chairman.
    Chairman Burns, as part of the oversight review, there are 
just some specifics on the budget proposal that I would like to 
ask, and if you think you need to respond to them for the 
record, that would be fine.
    Mr. Burns. Thank you.
    Senator Rounds. Your testimony states that the fiscal year 
2017 budget represents a decrease of $19.8 million from 2016, 
$15 million of which is a decision not to fund the university 
grant program. That leaves a decrease of $4.8 million and 90 
FTE in the NRC's office. Chairman Burns, I would expect that 
there would be more of a cost savings than $4.8 million 
considering the decrease in FTEs. Is the NRC spending some of 
the savings and efficiencies in other activities?
    Mr. Burns. No, Senator, it is not. And one thing I would 
note, with respect to the integrated university program, in 
terms of the President's budget reflects a judgment the 
Administration believes that those activities ought to be 
consolidated. We recognize that over a number of years we have 
received the direction to continue with that and have 
essentially absorbed that program and tried to implement it 
responsibly.
    But to your other point, we are looking at, we have 
identified savings. One of the things, as I said both in my 
submitted and in my oral testimony, as part of Project Aim, we 
have identified about $30 million beyond the President's budget 
submittal where we think through the re-baselining we can 
achieve additional savings.
    Senator Rounds. Then when can we expect to see the savings 
and the efficiencies fully reflected as actual decreases in the 
NRC spending, rather than, if it is being reallocated, but when 
will we see that actually reflected in the budget?
    Mr. Burns. Well, we see some of that actually in our 
implementation of the fiscal year 2016 budget, and as I say, 
although the President's budget came in at $970 million, which 
included incorporation of some of the identified gains or 
efficiency gains in areas where we thought we could reduce, we 
think there is more there for the fiscal year 2017. So there is 
some work we are doing this year where we think we are 
achieving those gains, and I think in the further consideration 
of the fiscal year 2017 budget we can achieve more.
    Senator Rounds. OK. Licensees must seek NRC review and 
approval for many modifications to equipment and procedures. As 
such, this is a fairly routine activity and a significant 
portion of the NRC's workload. However, the NRC seems to be 
struggling with a backlog, unable to complete their reviews on 
time in spite of the fact that from 2012 to 2015 the industry 
filed fewer licensing action requests than the NRC had budgeted 
to review. The NRC used the review about 1,500 licensing 
actions each year at a time when the agency had fewer people 
and fewer resources.
    What has changed since then to cause this recurring 
backlog?
    Mr. Burns. Well, thank you for the question, Senator. 
Actually, where we are, we have come to the point where we have 
substantially worked down the backlog. I think a major cause of 
the backlog was a need to focus on the potential safety 
enhancements post-Fukushima. What we have been able to do over 
the last few years is work that backlog down. I think it was 
like about 100 actions were in the backlog about a year ago, so 
we are about 24 now, and we expect to work them off within the 
next year.
    Progress to date through fiscal year 2016, we are just 
about at what our target of 95 percent completion, we are at 
about 94 percent. Staff, I know, will work to get that better. 
So I think the simple answer to your question, I think a lot of 
attention, necessary as it was, on Fukushima put some of the 
licensing actions on hold, created backlog. What we have been 
trying to do and have done successfully is work that off.
    Senator Rounds. OK. I have another question, but rather 
than that I just want to give you the opportunity, and I think 
Ranking Member Boxer had asked you a question, and she was out 
of time. I have a few seconds left. Is there any part to her 
question that you would like to respond to with regards to when 
staff recommendations are made, and sometimes the Commission 
decides not to accept or may have other things? Is there 
anything you would like to respond to that you didn't have time 
to when the Ranking Member was asking the question?
    Mr. Burns. I think she has given me a fair opportunity to 
answer her question. The only context I would give is that the 
Near-Term Task Force, I was here as general counsel then, and I 
have a lot of respect, and there are a number of folks who are 
still working with the agency and proudly do so.
    But what I would say is this, the Task Force had an 
enormous task in 90 days to say what are the things we ought to 
be looking at, and the Commission and the staff took that 
seriously. Staff added some additional things, and we took 
those seriously. So I think from my standpoint we may have 
disagreements about whether some of those things should be 
implemented or not, but I think we have taken them seriously, 
and I continue to do so.
    Senator Rounds. Thank you, sir.
    Thank you, Mr. Chairman.
    Senator Inhofe. Thank you, Senator Rounds.
    Senator Carper.
    Senator Carper. Thanks very much.
    Welcome, one and all. Good to see you.
    Commissioner Ostendorff, tell us what you are going to be 
doing next, please.
    Mr. Ostendorff. Senator Carper, I have accepted a position 
at the Naval Academy as a distinguished visiting professor of 
national security, and I will start teaching there in August.
    Senator Carper. All right. Well, as we say in the Navy, 
fair winds and a following sea. Thank you for all of your 
service to our country.
    Mr. Chairman, thank you very much for bringing us together 
for this hearing. I recently wrote a letter to Chairman Burns 
about the challenges of safely licensing advanced nuclear 
reactors. I was encouraged to see that the NRC budget request 
for 2017 includes $5 million to develop the licensing 
infrastructure.
    I would just start off by asking Chairman Burns and others 
who would like to join in what you expect to do with the $5 
million targeted toward the development of advanced nuclear 
reactor technology regulatory structure in terms of hiring 
appropriate staff. Give us some idea how many might be needed, 
technology development, maybe some other activities.
    Could you start off with that, please?
    Mr. Burns. Certainly, Senator. Thanks for the question.
    Probably three areas that we focus on with the $5 million, 
focusing on licensing infrastructure. Given that the current 
infrastructure focuses primarily on light water reactors, these 
advanced reactors are in a lot of non-light water technologies, 
are there areas where we need to address there? Part of it is 
technical preparation, getting some of the right staff, 
understanding where we may be going, actually talking with our 
Canadian counterparts about the processes.
    One of the concerns is whether people have to go all or 
nothing in terms of coming in with an application. Are there 
ways of doing, in effect, what we would call topical reports 
that sort of give maybe not a final sign off, but it gives 
encouragement that says you look like you are on the right 
step, we don't see a primary safety problem. We are looking at 
that, and our Canadian colleagues have a process to do that, 
and we are encouraged to do that.
    I think, again, it is outreach. We had a successful 
workshop we co-hosted with DOE last year----
    Senator Carper. I am going to interrupt you and just ask 
some specific questions if I could.
    Mr. Burns. OK.
    Senator Carper. How long do you expect the regulatory 
development process to take?
    Mr. Burns. I couldn't hear you. Sorry.
    Senator Carper. How long do you expect the regulatory 
development process to take?
    Mr. Burns. I think that is over probably several years. I 
don't think we really expect an advanced non-light water 
application probably until the mid-2020s, so we have some time 
there. There is work underway, and I think we would continue.
    Senator Carper. Might we expect to see similar requests in 
coming years?
    Mr. Burns. Probably. What we understand, I think this is 
some of information we get from DOE in some of these 
initiatives, I think around 2025.
    Senator Carper. OK. So in terms of how much money and 
roughly how much time will it take to put the appropriate 
regulatory structure in place, we are talking about 8 or 9 
years?
    Mr. Burns. I am not sure it would take that long. Part of, 
I think, what this $5 million helps us do is understand where 
the gaps are, what other work we would have to do. But I think 
we want to encourage those who are interested in the industry 
to talk to us and we want to be in a place where we are ready 
and we have identified the issues that we think need to be 
addressed.
    Senator Carper. OK.
    Commissioner Ostendorff, any idea when you might anticipate 
advanced nuclear reactor technology applications being 
presented to the Commission? Any idea?
    Mr. Ostendorff. Thank you for the question, Senator Carper. 
I spoke at a conference at Oak Ridge National Laboratory back 
in February of this year, met with a number of groups that are 
looking at, on the vendor side, developing new technologies. I 
have had communication with the Nuclear Infrastructure Council, 
Nuclear Innovation Alliance, Nuclear Energy Institute, and 
Third Way, four different groups who are working in this area. 
There is not a predicted date, but we think it is possible in 
the next 5 years to receive an application.
    Senator Carper. Do you think that the NRC staff have the 
non-light water reactor design and modeling skills that are 
going to be required to consider applications for advanced 
nuclear reactors?
    Mr. Ostendorff. Let me answer that by using an anecdote, if 
I may. Right behind me is Amy Cubbage. Amy, please raise your 
hand. Amy is my reactor assistant. She was a member of the 
Near-Term Task Force on Fukushima issues. She has been my 
reactor assistant for the last 3 and a half years.
    Amy, 15 years ago, worked on the pebble bed reactor 
technology that was submitted to the NRC, and those plans were 
curtailed at the industry's request. I would say we have many 
other people like Amy at the NRC who have had some experience 
working in non-light water reactor technologies, and we believe 
we can fully capitalize on their skill sets going forward.
    Senator Carper. OK. Thanks so much again, and thank you for 
your service. Great to see you.
    Commissioner Svinicki, Commissioner Baran, thank you all 
for joining us today.
    Senator Inhofe. Thank you, Senator Carper.
    Senator Barrasso.
    Senator Barrasso. Thank you, Mr. Chairman.
    Chairman Burns, thank you, and I think the members for 
being here today. I want to discuss the NRC permitting process. 
During its licensing reviews, the NRC staff frequently poses 
requests for additional information, they call it the RAI, 
Request for Additional Information, to licensees, to 
applicants. It is clear the NRC should request any information 
necessary to make a safety determination, then process the 
information, because the process itself can be burdensome if it 
is not properly managed, and that is one of the concerns about 
how this works.
    Chairman Inhofe and Senator Capito and I have tasked GAO 
with examining the very problem, and I want to just give you 
one example of why we feel the process warrants some scrutiny 
from you as chairman. With regard to a request for additional 
information request made by the NRC to the United States 
Geological Survey, it regards their renewal application for a 
research reactor they have in Denver.
    This is what the NRC asks the United States Geological 
Survey, and this is recent, February 8th, 2016. It says: The 
application indicates that the United States Geological Survey 
is a Federal bureau within the United States Department of 
Interior. To comply with 10 CFR 50.33(d), the staff--your 
staff--requests that the applicant state whether the United 
States Geological Survey is owned, controlled, or dominated by 
an alien foreign corporation or foreign government, and if so, 
give details.
    This is what your staff has decided to ask the U.S. 
Geological Survey. Now, I am going to quote what the NRC's 
instructions for developing these requests for additional 
information are, because you need to get additional information 
sometimes. Your own instructions say before developing a 
request for additional information, the staff should ensure 
that the information isn't already available to the staff or 
that the answer could not reasonably be inferred from general 
knowledge or previously docketed correspondence.
    So I think not only can it be reasonably inferred that 
anyone outside the NRC staff that the United States Geological 
Survey is part of the Federal Government, the fact has been 
docketed in previous correspondence with the NRC staff. They 
actually asked the same question in an RAI in 2010, and they 
got the same answer. It just seems that project managers are 
supposed to be responsible for ensuring that these requests for 
additional information are actually necessary on companies, my 
State, other States, but do you have any idea how this sort of 
thing keeps happening?
    Mr. Burns. No, Senator, and I would agree that that 
question is unnecessary. I appreciate the request the committee 
has made to have GAO take a look at it. It is something--and I 
think our EDO is committed to bringing discipline, bringing 
training. This may be, in part, one of these things in terms of 
the transition from the generational shift from older folks 
like me who are getting fewer at the Commission to some of our 
young staff.
    As a lawyer, I know, for example, I would go up to the 
judge and say, Your Honor, will you take official notice or 
judicial notice that the USGS is a U.S. Government agency. We 
can do better. I think that the review will probably help us do 
that, and I think our staff will continue to be vigilant. But 
we need to be disciplined because it is important. There are 
important questions we have to ask during the review, but we 
need to focus on the things where those touchy safety issues or 
undefined things. So I appreciate the example.
    Senator Barrasso. OK, thank you. I asked a question for the 
record back in October, October 7th hearing, that essentially 
asked how might a longer license duration help the NRC manage 
its workload a little better with regard to uranium recovery 
facilities. I think you said extending the license term would 
reduce the administrative burden associated with the license 
renewal process for both the NRC, I think you said, the staff 
and the uranium recovery licensees, and I agree.
    Will you, therefore, commit to me to help pursue extending 
the license duration for uranium facilities for the reason that 
you had stated? Because it used to be 5 years; we extended it 
to 10 back in the 1990s, which helped, but it takes about 5 
years to get through the full process.
    Mr. Burns. I think that is something we can look at. As you 
noted, we had extended before. My understanding and as a 
general matter, given where we are in terms of some of the 
licenses before us, renewals, it becomes a more critical issue 
in the early 2020s, but that gives us some time to, I think, 
consider that, and I think the staff will be willing to do 
that.
    Senator Barrasso. Thank you.
    Thank you, Mr. Chairman.
    Senator Inhofe. Thank you, Senator Barrasso.
    Senator Gillibrand.
    Senator Gillibrand. Thank you, Mr. Chairman. Thank you, 
Madam Ranking Member.
    As I am sure you are aware, last week Entergy, which 
operates Indian Point Units 2 and 3 in New York, discovered 
that 227 baffle-former bolts inside of Unit 2's reactor core 
are degraded, which is more than 10 percent of the specific 
type of bolts used in the reactor. My understanding is that 
these bolts are used to hold together the core former which 
surrounds the nuclear fuel. Do you have any information about 
whether there was any degradation of these bolts detected prior 
to this most recent inspection?
    Mr. Burns. Senator, I am not sure. Let me get back to you 
on that, whether there were indications. As you said, the 
inspections were started after defueling and identified, and I 
want to give you the best answer I can.
    Senator Gillibrand. OK. Would you have concern about other 
types of bolts if that was indeed the case?
    Mr. Burns. I think your concern about the bolts there, and 
this is part of the monitoring I would expect at plants. This 
is the type of equipment that you want to see----
    Senator Gillibrand. You would expect that type of 
monitoring?
    Mr. Burns. Pardon?
    Senator Gillibrand. You would expect that kind of 
monitoring?
    Mr. Burns. Yes. That is what happened here.
    Senator Gillibrand. OK, then I would urge the same 
inspection for Unit 3, because they have decided not to expect 
Unit 3 because it is 3 years younger. Do you think that is a 
legitimate reason not to inspect Unit 3?
    Mr. Burns. Actually, my understanding from my staff is that 
it will be inspected in several years. It has operated less----
    Senator Gillibrand. I wouldn't wait several years. If 11 
percent is degraded and you didn't expect to find degradation, 
it means your expectations are wrong. So I would not wait a few 
years; I would inspect Unit 3 immediately.
    Mr. Burns. OK, we will take that into consideration, 
Senator, but I think the technical evaluation of our staff 
assure that they believe that the timing is appropriate.
    Senator Gillibrand. Their technical evaluation concerning 
Unit 2 was flawed, so I would be highly concerned that their 
technical evaluation concerning Unit 3 is also flawed, and I 
would request you to do the inspections now. It is unexpected 
to have 10 percent degradation. One of the bolts couldn't even 
be found.
    That is highly alarming to me, given that it is just 50 
miles from 8 million people. We do not want to have any 
problems at this power plant, and I think you have to be more 
concerned than you might be otherwise, given the failure to 
know that 10 percent of your bolts were degraded so close to 
the reactor. I think it is very unwise and I think it is 
unsafe.
    So who decides? Who is the technical decisionmaker here?
    Mr. Burns. The NRC considers and evaluates the information 
it has. The licensee has programs in terms of monitoring and 
maintenance, and those are integrated together.
    Senator Gillibrand. So when do you step in and require an 
infrastructure issue to be treated as a significant safety 
issue for the plant?
    Mr. Burns. When we identify it as a significant safety 
issue.
    Senator Gillibrand. Is 10 percent of degradation a 
significant safety issue?
    Mr. Burns. I would be happy to consult with our staff in 
terms of their evaluation. They are evaluating what the 
licensee is doing and examining there, and I would expect us to 
take that information into account.
    Senator Gillibrand. I would like a written response to 
these questions, specifically whether you think 10 percent 
degradation of bolts is a safety issue. If not, why not? And if 
you do, then I would like you to evaluate Entergy's plan and 
make recommendation about what they should do instead.
    Does anyone else on the panel have a comment to this 
concern?
    Mr. Baran. Well, Senator, let me just add I think the 
written request you asked for is completely appropriate, we 
should do that. You should have a complete answer to those 
questions. My understanding is that the number of baffle bolts 
that were potentially problematic in this case is a 
substantially larger number than we have seen in the past with 
other plants that had this issue, so I know it is something the 
staff is looking at very carefully. We should get you the 
answers you are asking for.
    Senator Gillibrand. Well, I would like aggressive oversight 
here.
    Both Indian Point Units 2 and 3 are currently in a period 
of relicensing. A major component of relicensing is the 
management of aging infrastructure. Is it fair to say that as 
you go through the process of evaluating a plant for 
relicensing, there are a certain set of assumptions made on 
what you expect the condition of the plant's infrastructure to 
be and how the plant will operate if it is relicensed based on 
past performance of safety records?
    Mr. Burns. Senator, I would agree essentially with that you 
said. The focus on license renewal tends to be on aging 
management. In fact, I believe the issue of the question of the 
inclusion of the baffle bolts is a matter in contention within 
the license renewal hearing. We can't comment on the outcome of 
that, I think it is still going on, but that is the focus. So I 
think I would agree with your general characterization.
    Senator Gillibrand. So if you find that degradation was 
higher than you expected, will you then go back and challenge 
other assumptions you made in the review for relicensing?
    Mr. Burns. If that is appropriate.
    Senator Gillibrand. Meaning if your assumptions were wrong, 
I would like you to go back and look at all of your assumptions 
concerning degradation.
    Mr. Burns. We would look at our assumptions.
    Senator Gillibrand. Thank you.
    Thank you, Mr. Chairman.
    Senator Inhofe. Thank you, Senator Gillibrand.
    Senator Capito.
    Senator Capito. Thank you, Mr. Chairman, and thank all of 
you for being here today.
    Chairman Burns, I listened to your testimony, and I just 
want to make sure that in terms of the budget and your FTEs, 
your employees, where the numbers are. I understand that in 
2005 your budget was $669 million and you had just over 3,100 
employees, and today you are overseeing a smaller--I think we 
brought this up several times--a smaller nuclear fleet and 
considering far fewer licensing actions, but you are requesting 
$982 million and over 3,500 employees. I know Project Aim is 
specifically aimed at this issue, and I applaud your progress.
    How far along is Project Aim, and how much longer do you 
plan to continue? And do you think that will be shrinking the 
work force, number of employees?
    Mr. Burns. Thank you for the question, Senator. Project 
Aim, in terms of the particular tasks that were identified when 
it began, is pretty far along. This re-baselining paper, which 
the Commission will issue its final guidance on I think very 
soon, was one of the main steps.
    We have some additional papers and recommendations to come 
from the staff, for example, on the consolidation, the new 
reactors, and recombining the new reactor office with a nuclear 
reactor regulation office, a few things like that. The EEO and 
the CFO have given some tasks in terms of further looking at 
the corporate support offices and potential efficiencies and 
reductions there.
    So the main activities that were identified in the Aim 
program were, I think, come to close this year. The longer term 
issue, and I have been talking to the EEO and I think my fellow 
commissioners, and I will let them add if they wish, is really 
incorporating sort of the ongoing awareness and idea of looking 
at how we do our work to assure we get the safety security 
benefit that we need while doing it effectively and 
efficiently. That is the longer term challenge once I think 
most of their Aim activities conclude this year.
    Senator Capito. Does anybody have any other comment on 
that?
    Mr. Ostendorff. Senator, I would just add and reinforce the 
chairman's comment that there is still more work to be done 
both on corporate support as well as some of the programmatic 
activity lines, and we are committed to doing that work.
    Senator Capito. Thank you.
    Mr. Baran. Just briefly. I will just give you a couple of 
concrete numbers that I think illustrate how aggressive the 
effort has been. At the beginning of fiscal year 2016 we had 
3,628 FTE. By the end of fiscal year 2017, so 2 years later, we 
expect to see that number drop to 3,344 if all these re-
baselining items are approved. That is 284 fewer employees in 2 
years, or about 8 percent of our work force. It is a pretty 
significant decline we have seen.
    Senator Capito. And you are already on your way there 
because you are at, like, 35-something at the present time.
    Mr. Baran. That is right. Yes.
    Senator Capito. Chairman Burns, also, you were directed ay 
appropriators to discontinue the practice of carrying over 
budgeted funds from one fiscal year to the next. Are you 
carrying over any funds in this fiscal year?
    Mr. Burns. Well, our plan is to obligate the funds that we 
have been appropriated in 2016.
    Senator Capito. Right.
    Mr. Burns. With respect to potential carryover, there is 
the potential for some at the end of the year, some de-
obligation. I think it is somewhat less than $25 million.
    Senator Capito. Well, I am on the Appropriations Committee, 
and I mean, I think you can understand in tight times you want 
to appropriate to the proper amount for the particular year 
because there is a lot of give and take and a lot of flat in 
the budget. So you can understand why that would be an issue.
    Another issue, we are having trouble getting conflicting 
numbers on the number of rulemakings that are in progress right 
now. We have been given numbers between 43 to 60. Do you have 
an accurate number for that?
    Mr. Burns. Yes. What we did, and this is quite honestly one 
of my frustrations and one of the reasons why I asked for a 
tasking to say let's get a consistent reporting on these 
issues. We have what would be called rulemaking activities, 
about 80, and part of that 89 is there are a number of those 
things that are, for example, petitions for rulemaking. That 
means the industry or a citizen can file something.
    We have an obligation under the law to look at that. We can 
probably give you a better breakdown for the record, but a 
number of other things are things like incorporating industry 
consensus standards, cast certifications, things like that that 
the industry wants.
    But we have, I think, a good handle on what the number of 
``rulemaking activities'' are. And one last point is within 
those 89, the staff has identified for potential elimination a 
number of rulemakings so that we would take those off where we 
see limited value in proceeding.
    Senator Capito. If you could get me that, maybe more detail 
on that.
    Mr. Burns. I can try to give you a better breakdown.
    Senator Capito. All right. Thank you so much.
    Senator Inhofe. Because a vote has started, and we are good 
for another probably 15 minutes here, we are going to continue.
    Senator Boxer wanted to make one statement that I think is 
reasonable.
    Senator Boxer. Really quickly. Thanks, Mr. Chairman.
    We only got to four of the recommendations. Could I count 
on you to answer my questions in writing on the rest of the 
list?
    Mr. Burns. Absolutely.
    Senator Boxer. I know that you are taking these seriously. 
That is the difference between that and implementation. So I 
appreciate all of you being here today.
    And I thank you, Mr. Chairman.
    Senator Inhofe. Thank you, Senator Boxer.
    Senator Markey.
    Senator Markey. Thank you, Mr. Chairman, very much.
    I just want to once again put the Commission on notice that 
the NRC is still not in compliance with its own policy and the 
law surrounding providing documents to members of your 
oversight committee. It has been almost 2 years since I first 
requested documents related to the indictment of five members 
of the Chinese military on charges of hacking and stealing 
nuclear reactor trade secrets from Westinghouse in 2010 and 
2011. At the very same time that these thefts occurred, 
Westinghouse was hosting months-long visits for dozens of 
unescorted Chinese personnel at U.S. nuclear reactors.
    I have narrowed my document request. I have sent several 
letters. I have raised this in several hearings of this 
committee. I have raised it in private conversations with the 
chairman of the Commission. My staff has been briefed by your 
staff. The Commission still hasn't even provided me with the 
documents that others at the agency have already made it 
possible to get access to.
    I am not willing to accept briefings in lieu of my document 
request, nor is it helpful for the Commission to ignore the 
need to respond to my request until several days before the 
hearing. When you ask for a meeting on this issue, I expect the 
Commission's response to my request.
    I just wanted to put that on the record, and I would ask 
the Commission again to comply with the request for that 
information.
    In 2014 an insider at the Doel Nuclear Plant in Belgium 
sabotaged the reactor by draining all the oil from the reactor 
turbine. This was not all that sophisticated; it was basically 
the nuclear reactor technology equivalent of slashing someone's 
tires.
    But it caused more than $100 million in damage. Two years 
earlier a contractor at the plant who had passed a security 
background check traveled to Syria to fight with jihadist 
groups there. This incident is similar to that of Sharif 
Mobley, an American who worked at U.S. nuclear plants and 
subsequently fought with Al-Qaeda in Yemen.
    Disturbingly, the background check investigations that are 
required for nuclear contract workers allow them to self-report 
their foreign travel. We also recently learned that two suicide 
bombers in the Brussels terrorist attacks had collected video 
footage at the home of a Belgian nuclear official.
    Commission Baran, do you agree, then, in light of these 
disturbing reports from Belgium, the Commission should take a 
new look at its design basis threat, force-on-force mock 
terrorist exercises, and other security regulations?
    Mr. Baran. I have to be careful answering that just because 
the design basis threat issues are classified. I can say that 
the NRC staff is taking a look at this issue, and I believe 
that is appropriate. The events you raised are something that 
is being looked at by our security folks.
    Senator Markey. We know that nuclear power plants, gaining 
access to those materials are at the top of the terrorist 
target list, so I recommend very strongly that you put in place 
a program to reexamine the measures that we have in place. That 
is where they are going, and we have been warned, and I think 
it is critical for us to have heeded those warnings.
    The NRC is currently doing a rulemaking to address 
decommissioning in light of the many reactors that are now or 
soon to be shutting down, including the Pilgrim Plant in 
Massachusetts. The commissioners told the staff that the new 
rules should consider the concerns of State and local 
officials, but the nuclear industry wants the Commission to 
eliminate the consideration of State and local officials' views 
from the rulemaking altogether.
    At a recent NRC meeting, Massachusetts State Senator Dan 
Wolf said the industry's suggestion was absurd.
    Starting with Commissioner Baran, do you all agree that it 
would be absurd to eliminate all consideration of State and 
local officials' concern in your decommissioning rulemaking?
    Mr. Baran. I agree that would be a very bad idea. I think 
we absolutely, as part of that rulemaking, should look at the 
appropriate role of State and local governments in the process.
    Senator Markey. Can we keep coming down the panel? Do you 
agree?
    Mr. Ostendorff. Senator Markey, we had a good Commission 
meeting on this topic here last month. We heard the State 
senator from your State, his comments, and we are considering 
all these comments as we go forward here.
    Senator Markey. Thank you.
    Ms. Svinicki. Senator, the NRC staff is engaging in looking 
at all of the public input that came in. The comment period is 
closed, and I look forward to their evaluation of all of that 
public comment.
    Senator Markey. Mr. Chairman.
    Mr. Burns. Really the same response. I haven't made up my 
mind on this. I want to look at the comments. I want to extend 
my appreciation to Commissioner Baran for suggesting this 
meeting. I think when you and a number of others wrote to us 
this was one of the impetuses for holding that meeting on the 
decommissioning issues.
    Senator Markey. OK. Well, only one of you can, right now, 
say yes, that the State officials should be listened to, and I 
think that is not a good thing.
    Mr. Burns. Well, I don't think that is what I said. That is 
not what I mean to imply. I think we need to take into 
consideration those views in this process.
    Senator Markey. OK.
    Senator Inhofe. Thank you very much, Senator Markey.
    Senator Markey. Thank you, Mr. Chairman.
    Senator Inhofe. Senator Fischer.
    Senator Fischer. Thank you, Mr. Chairman.
    Chairman Burns, I would like to ask you a few questions 
about the Backfit Rule. That is a topic that I have raised in 
several of our committee's oversight hearings of the NRC in the 
last 2 years. As you know the Backfit Rule says that before the 
NRC can impose a new requirement on an existing licensed 
facility the NRC must first demonstrate that the new 
requirement results in a substantial increase in the protection 
of public health and safety and also that it is cost justified.
    This committee has expressed concerns about how the NRC's 
use of subjective qualitative factors, as opposed to objective 
quantitative factors, can erode the Backfit Rule and undermine, 
I believe, its important purposes, and I have been very 
concerned about that.
    Sir, are you aware of the compliance exception to the 
Backfit Rule, and do you believe it should be used by the NRC 
staff to avoid the Backfit Rule in cases involving changes in 
interpretations of existing regulations?
    Mr. Burns. Yes, Senator, I am aware of the compliance 
exception to the Backfit Rule. It has a role, and it should be 
applied that way. I don't view it as a way of evading the 
Backfit Rule but a way of looking at what is the requirements, 
what is compliance; if it fits in that, otherwise you need to 
apply the Backfit Rule the substantial additional protection 
elements.
    Senator Fischer. So are you saying that your staff would be 
justified in requiring extra steps for regulation that don't 
take into effect the cost?
    Mr. Burns. No. What I think I am saying is that there may 
be circumstances in which the question or the issue between a 
licensee and the staff is whether or not some corrective 
action, some other action by the licensee is really something 
needed to comply with existing requirements. That is an 
exception. I don't mean the exception to swallow the rule. But 
that is a stated exception the Commission adopted in the mid-
1980s when it reformed the Backfit Rule.
    Senator Fischer. And the rule then should still be in 
effect.
    Mr. Burns. Yes.
    Senator Fischer. It should be considered at all times?
    Mr. Burns. Well, the Backfit Rule has a substantial 
additional protection piece of it. Included within the Backfit 
Rule are these limited exceptions to whether or not you engage 
in the cost-benefit analysis. I am just saying I think the rule 
should be applied appropriately in the circumstances we find 
ourselves in.
    Senator Fischer. And costs should be considered?
    Mr. Burns. Costs should be considered where it is not a 
compliance backfit, or for example there is a statutory 
requirement that has been imposed by the Congress to do 
something. It is part of a normal evaluation and consideration 
of the Backfit Rule. I don't want to leave you the impression 
that I am saying that the exception should swallow the rule. It 
is part of the normal process of evaluating whether a 
particular action requires the backfit analysis, the 
substantial additional protection.
    Senator Fischer. I think this gets us back to the 
discussion on looking at if it is a subjective factor or an 
objective factor when we consider the rules and regulations. 
Would you agree with me on that? And I would always come down 
on the objective side of this.
    Mr. Burns. Well, and the Commission's guidance----
    Senator Fischer. I think that has been clear.
    Mr. Burns. Yes. And I think the Commission's guidance 
issued about a year or so ago emphasizes we expect the 
application of quantitative factors, and we have given 
guidance, and I would expect that as the process of engagement 
between licensee and staff goes on that that guidance of the 
Commission would be adhered to.
    Senator Fischer. OK, thank you.
    Also, in a letter that was dated January 20th of this year, 
the Nuclear Energy Institute discussed concerns about misuse of 
the compliance exception. For historical context, the NEI 
letter quotes from the Federal Register Notice from the 85 
Backfit Rule where the NRC explained new or modified 
interpretations of what constitutes compliance would not fall 
within the exception and would require a backfit analysis.
    I think this is getting at it again. Would you agree for 
the NRC staff to be able to use that Backfit Rule's compliance 
exception that the staff first of all has to show some omission 
or mistake that has occurred within that licensed facility that 
was previously approved by the NRC?
    Mr. Burns. I think my answer is yes, but let me give some 
explanation.
    Senator Fischer. OK.
    Mr. Burns. The provision I think you quoted from the 
Federal Register, the statement of consideration for the 
Backfit Rule, are significant example or significant guidance 
from the Commission with respect to the appropriate application 
of the compliance exception. And I am aware of the NEI letter, 
but I am not aware of all the details of some of the dialogue, 
but I would expect in the dialogue between staff and licensee 
that that would be focused on, and in terms of the 
decisionmaking those are persuasive words or persuasive 
criteria that the Commission set at that time. So what I want 
to say is I don't think they are easily discarded.
    Senator Fischer. Thank you, sir.
    Thank you, Mr. Chairman.
    Senator Inhofe. Senator Boozman.
    Senator Boozman. Thank you, Mr. Chairman.
    Chairman Burns, thank you for your upcoming plans to visit 
Arkansas Nuclear 1. As you know, nuclear power improves air 
quality. Each year Arkansas Nuclear 1 allows our State to 
reduce air emissions. For example, in just 1 year, the plant 
reduces sulfur dioxide by about 14,000 tons, it reduces 
nitrogen oxide by about 10,000 tons, and it reduces 
CO2 by nearly 8.5 million metric tons.
    In other words, thanks to nuclear power in Arkansas we 
reduce acid rain, smog, and ground level ozone. The operation 
of our Arkansas Nuclear 1 directly creates more than 1,000 good 
paying jobs; it provides a reliable source of over 1,800 
megawatts of clean power to Arkansans. The plant provides 
affordable power that supports many other jobs and industries 
across our State that helps families keep the lights on.
    The NRC staff has been working diligently to address a few 
issues that were discovered at the plant following a serious 
industrial accident that occurred 3 years ago during 
maintenance on the non-nuclear side of the plant. I applaud the 
efforts of energy and the NRC staff to address these issues 
while keeping the plant safely operating. We really are very, 
very proud of our nuclear plant.
    Just a question. We want to make sure you have the 
resources you need to do your work, and we want to make sure 
that the NRC budget is right sized for today's workload. The 
NRC's work on Project Aim is intended to more closely align 
NRC's resources with the actual workload while making sure the 
NRC meets its safety and security missions.
    In your testimony you say, ``The NRC has taken a hard look 
at the proposed budget and is proposing reductions in both 
full-time equivalents and contract support dollars that 
represent real savings. As we continue our work through the 
Project Aim initiative we anticipate additional savings and 
efficiencies to come.''
    How would these additional savings translate in reductions 
of the NRC fiscal year 2017 budget request of $982.3 million 
and 3,523 FTEs?
    Mr. Burns. Thank you for the question, Senator. I do 
appreciate the opportunity to be able to go visit Arkansas 
Nuclear 1 and 2 soon. It is a plant I haven't been to as yet.
    The answer to your question is that we have identified, 
primarily through the re-baselining effort through Project Aim, 
about $31 million in additional savings, and I think below what 
we came in on the President's budget, part of that is, you 
know, the timing of the President's Budget and the review 
process.
    The Commission is about ready to issue its final guidance 
on these additional re-baselining items, and I think they 
represent about $31 million. There are a few more, and frankly 
the number escapes me now, that we see that would go on into 
2018. I forget; it is about $8 million in additional savings. 
So that is where I would say the core of it is, and I think it 
is a demonstration we have taken this effort seriously.
    Senator Boozman. How about Project Aim recommendations and 
work force planning, including strict hiring controls, staff 
reduction buyouts; how would that affect things?
    Mr. Burns. The Office of the Chief Human Capital, I used to 
call it HR, now it is OCHC, so I get confused sometimes. Our 
H.R. office basically has put hiring controls, so in terms of 
external hires we are looking only at very critical positions, 
looking to be more flexible, that is the strategic work force 
planning, about getting people with skill sets who might, say, 
working in the reactor area go to the materials area and 
working with things like that.
    We did do an early out buyout last year. We were authorized 
up to about 100. We had about 50, I think 49 take it. We are in 
the process of going through the process of getting 
authorization for an additional effort in that way, but that is 
in process. So we would do that again to achieve some savings 
this year.
    Senator Boozman. Thank you, Mr. Chairman, and Chairman 
Burns.
    Mr. Burns. Thank you.
    Senator Inhofe. Thank you, Senator Boozman.
    Senator Sessions had questions concerning Yucca Mountain, 
and without objection I am going to ask him to submit to each 
one of you those questions, and we would anticipate a response 
by the end of the week. OK?
    Thank you very much for your patience and also getting us 
out on time.
    We are adjourned. Thank you.
    [Whereupon, at 11:20 a.m. the committee was adjourned.]
    [An additional statement submitted for the record follows:]

                  Statement of Hon. Bernard Sanders, 
                 U.S. Senator from the State of Vermont

    In examining the fiscal year 2017 budget request for NRC I 
would like to focus on the need to provide a strong role for 
the public in the decommissioning process when a nuclear plant 
shuts down. The fundamental issue here is the role of the State 
and the local community members in the decommissioning process. 
The community of Vernon, Vermont, is grappling with the effects 
of the decommissioning process of the Vermont Yankee nuclear 
plant, and communities all over the country are now, or will 
soon, experience the process of having the plant in their 
community shut down.
    As I understand the current rules do not apply uniquely to 
decommissioning. The current rules allow the NRC to sit down 
with the companies to negotiate a decommissioning process, and 
States have no significant role in that process. They can be 
observers, they can attend public meetings, they can provide 
input, but at the end of the day the company and the NRC work 
out the agreement. On the face of it that just doesn't make a 
whole lot of sense. The people of the State, regardless of 
whether it's Vermont, Massachusetts, New York, or California, 
it seems to me have the right to have a seat at the table. The 
NRC must be very diligent in ensuring adequate public input as 
it continues to develop its new rules.
    Additionally, specifically regarding Vermont Yankee 
although the NRC is in the very beginning of the process of 
developing regulations regarding decommissioning, the NRC 
continues to approve requests from Entergy to waive current 
regulations. I find that very problematic.
    For example, the NRC approved Entergy's request to withdraw 
funds for spent fuel management from the Decommissioning Trust 
Fund, which is expressly disallowed by NRC's own regulations. 
The NRC also recently allowed Entergy to decrease the level of 
both its onsite and offsite insurance from the required $1.06 
billion to merely $50 million. This lower amount is expressly 
in violation of the level required by the NRC's own 
regulations. NRC's insurance requirements do not explain what 
should happen in the instance of a decommissioning and should 
be followed until there are regulations that expressly consider 
the unique circumstances and risks of the decommissioning 
process.
    That, of course, is why the NRC is actively developing 
regulations for the decommissioning process. However, while we 
wait for the final rules the NRC continues to allow companies 
to avoid the existing regulations. The NRC should not negate 
its own rules and instead wait until it has an appropriate set 
of regulations that are drafted after sufficient input from the 
public. Those final regulations will be created with input from 
the public that will allow them to address the unique 
circumstances and risks of decommissioning. The NRC should wait 
tor that necessary input instead of allowing plants to continue 
to operate outside the NRC's own rules.

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