[Federal Register Volume 59, Number 86 (Thursday, May 5, 1994)]
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  Federal Register / Vol. 59, No. 86 / Thursday, May 5, 1994 /
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[Federal Register: May 5, 1994]


                                                    VOL. 59, NO. 86

                                              Thursday, May 5, 1994

NUCLEAR REGULATORY COMMISSION

10 CFR Part 12

RIN 3150 AE61

 

Equal Access to Justice Act: Implementation

AGENCY: Nuclear Regulatory Commission.

ACTION: Final rule.

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SUMMARY: The Nuclear Regulatory Commission (NRC) is amending its 
regulations by adding new provisions designed to implement the Equal 
Access to Justice Act (EAJA). The EAJA provides for the award of fees 
and expenses to certain individuals and businesses that prevail in 
agency formal adjudicatory proceedings in which the agency's position 
is determined not to have been substantially justified.

EFFECTIVE DATE: June 6, 1994.

FOR FURTHER INFORMATION CONTACT: Susan Fonner, Office of the General 
Counsel, U.S. Nuclear Regulatory Commission, Washington, DC 20555, 
telephone (301) 504-1634.

SUPPLEMENTARY INFORMATION:

I. Background.
II. Responses to Comments Received.
III. Administrative Statements.

I. Background

    The Equal Access to Justice Act (EAJA) became law on October 21, 
1981 (5 U.S.C. 504). The EAJA authorizes agencies to award attorney 
fees and other expenses to parties that prevail over an agency in 
certain agency proceedings under specified circumstances. Generally, 
for an award to be made, the proceeding must be one that is ``required 
by statute to be determined on the record.'' See, Ardestani v. U.S. 
Department of Justice, -------- U.S. --------, 112 S.Ct. 515 (1991).
    On October 28, 1981 (46 FR 53189), the NRC published a proposed 
rule designed to implement the EAJA in the Federal Register. However, 
serious doubt developed as to the need for the regulations. A 
significant consideration in this regard was the impact of a statutory 
bar against the use of funds appropriated to the NRC ``to pay the 
expenses of, or otherwise compensate, parties intervening in regulatory 
or adjudicatory proceedings.'' This provision first appeared in the 
Energy and Water Development Appropriations Act of 1981 (Pub. L. No. 
966-367, Sec. 502, 94 Stat. 1344, 1345 (1980)), and has continued to 
appear each year in subsequent NRC appropriation acts. In addition, 
case law developed in the 1980's indicating that the Commission would 
receive judicial support if it determined that no NRC license 
proceeding of any kind is covered by the EAJA.
    With the enactment of the Inspector General Act Amendments of 1988 
(Pub. L. 100-504, 1102 Stat. 2515), which established an Office of the 
Inspector General in the NRC, the NRC became subject to the Program 
Fraud Civil Remedies Act (PFCRA), 31 U.S.C. ch. 38. Hearings under the 
Program Fraud Civil Remedies Act are expressly covered by the EAJA, 
necessitating the issuance of EAJA regulations by the NRC. However, 
because of the length of time that had gone by since the NRC issued the 
1981 proposed EAJA rule, the Commission replaced it with a new proposed 
rule, published on August 2, 1993 (58 FR 41061). The new proposed rule 
was essentially similar to a model rule suggested by the Administrative 
Conference of the United States (ACUS) for agency adoption. (May 6, 
1988, 51 FR 16665.)

II. Responses to Comments Received

    In response to the August 2, 1993 proposed rule, the NRC received 
one set of comments from ACUS and one set from the Nuclear Management 
and Resources Council (NUMARC). The NRC's consideration of the comments 
follows.

A. Time Deadlines

1. Decision on the Petition for Increase of Maximum Rate for Attorney 
Fees
    Comment. ACUS recommended that the rule provide a specific time 
frame for agency action on a petition for rulemaking to increase the 
maximum rate for attorney fees.
    Response. The EAJA provides a $75 hourly ceiling on attorney fees, 
but allows agencies to raise the statutory ceiling by regulation. The 
proposed rule provides that any person may file with the Commission a 
petition for rulemaking to increase the $75 maximum hourly rate for 
attorney fees, and refers to 10 CFR 2.802 and 2.803 for the procedures 
to be followed with respect to such petitions. Neither the proposed 
rule nor 10 CFR 2.802 nor 10 CFR 2.803 provides a specific time frame 
for agency action on the petition for rulemaking. A sentence has been 
added to 10 CFR 12.107 requiring the Commission to determine what 
action it will take on the petition within 90 days after the petition 
is filed.
2. Decision on the Application for Award of Attorney Fees
    Comment. ACUS recommended that the rule provide a specific time 
frame for the adjudicative officer to issue an initial decision on the 
application for award of attorney fees.
    Response. 10 CFR 12.307 of the proposed rule states requirements 
for the adjudicative officer's initial decision on the application for 
award of attorney fees, but does not prescribe a time limit for the 
adjudicative officer to issue the decision. A sentence has been added 
to 10 CFR 12.307 requiring the initial decision to be issued within 90 
days after completion of proceedings on the application, but permitting 
the adjudicative officer to extend the time limit after notice to the 
parties of the reason for the delay. Authority is provided for the 
adjudicative officer to extend the time period in order to prevent the 
interruption of cases presenting pressing health and safety concerns. 
The NRC expects that extensions will be issued sparingly.

B. Exhaustion of Administrative Remedies

    Comment. ACUS stated that if the NRC believes that a request for 
administrative review should be a prerequisite to judicial review, it 
should recast 10 CFR 12.308 (Agency review) in light of the Supreme 
Court's decision in Darby v. Cisneros, ______ U.S. ______, 113 S.Ct. 
2539 (June 21, 1993).
    Response. Within the last year, the Supreme Court cast new light on 
the requirements for exhaustion of administrative remedies before 
appealing an agency decision to the courts. In Darby v. Cisneros, the 
Court held that an agency cannot insist on exhaustion of intra-agency 
appeals prior to judicial review unless the agency promulgates rules 
that require intra-agency appeals and stay the effect of agency 
decisions during such appeals. The Commission believes that for 
purposes of judicial and administrative economy a request for 
administrative review should be a prerequisite to judicial review, 
particularly because the NRC frequently entertains proceedings that 
encompass highly technical matters.
    The cross-reference in 10 CFR 12.308 to the review procedures set 
out in 10 CFR 2.786 should be sufficient to satisfy the commenter that 
the NRC has addressed the Darby case ruling in these regulations, 
because 10 CFR 2.786(b)(1) expressly provides that the filing of a 
petition for review is mandatory for a party to exhaust its 
administrative remedies. Nevertheless, it may be considered fairer 
notice to state the requirement in 10 CFR 12.308 itself. Therefore, the 
NRC has amended 10 CFR 12.308 to state unambiguously that an aggrieved 
party is required to seek Commission review of the adjudicative 
officer's initial decision.
    The application of the part of the Court's opinion on staying the 
effect of the initial decision seems inapposite in the context of an 
EAJA administrative proceeding, because it makes little sense to speak 
of a stay of an initial decision denying the application for award of 
attorney fees, which is the type of decision most likely to be 
appealed. A successful applicant for an award is not likely to appeal 
unless he or she is dissatisfied with the amount of the award. This 
poses a very different type of situation from that in the Darby case, 
where the Court had before it an agency decision debarring petitioners 
from participating in Federal programs. Nevertheless, in what is 
perhaps an excess of caution, we have included in NRC's EAJA rule a 
statement on staying the effect of the initial decision during an 
appeal to the Commission.

C. Proceedings Subject to the EAJA

    Comment. NUMARC commented that the rule should be revised to make 
clear that the only proceedings subject to NRC's EAJA rule are those 
conducted pursuant to the Program Fraud Civil Remedies Act.
    Response. The EAJA applies only to an agency adversary 
adjudication. 50 U.S.C. 504(a). The term ``adversary adjudication'' is 
defined by 5 U.S.C. 504(b)(1)(C) to mean an appeal of a decision made 
pursuant to section 6 of the Contract Disputes Act of 1978 (41 U.S.C. 
605) before an agency board of contract appeals, a hearing conducted 
under 31 U.S.C. ch. 38 (PFCRA), and an adjudication under 5 U.S.C. 554 
(the Administrative Procedure Act). Section 554 of the Administrative 
Procedure Act expressly states that (with certain exceptions) it 
applies ``in every case of adjudication required by statute to be 
determined on the record after opportunity for an agency hearing.''
    A proceeding for the purpose of granting or renewing a license is 
expressly excluded from EAJA coverage by 5 U.S.C. 504(b)(1)(C). 
However, there is no express exclusion of proceedings suspending, 
revoking, or amending a license, including that for a nuclear reactor. 
As indicated in the Supplementary Information for NRC's proposed EAJA 
rule, the question of such proceedings was at least addressed partially 
in 1983, when a materials license amendment proceeding was judicially 
held as not being required by statute to be conducted ``on the 
record.'' In that case, the court declined to read section 189(a) of 
the Atomic Energy Act of 1954 (AEA) as requiring an on-the-record 
hearing, in the absence of clear Congressional intent to trigger the 
formal on-the-record hearing provisions of the Administrative Procedure 
Act. West Chicago, Ill. v. U.S. Nuclear Regulatory Commission, 701 F.2d 
632 (1983). Since that time, the Commission has gone on record that it 
interprets section 189a of the AEA as not requiring formal hearings in 
reactor licensing proceedings. En Banc Brief for Respondents dated 
August 30, 1991 (filed in the U.S. Court of Appeals for the District of 
Columbia Circuit, No. 89-1381, Nuclear Information and Resource Service 
v. NRC, at pp 32-38).
    In light of the above, it is not unreasonable to conclude that no 
NRC proceeding other than an appeal to a board of contract appeals 
under the Contract Disputes Act or a Program Fraud Civil Remedies Act 
hearing is covered by the EAJA. Nevertheless, the Commission does not 
wish to frame its EAJA regulations in such a way as to preclude 
potential applicants for attorney fee awards from raising the issue of 
EAJA coverage, if they can make a good faith argument that the 
proceeding in which they have been involved falls under the EAJA. In 
addition, there is always the possibility of new enactments that could 
make the EAJA applicable to proceedings not previously entertained by 
the agency. Therefore, the Commission has decided not to state that the 
NRC's EAJA rule applies only to a proceeding under the Program Fraud 
Civil Remedies Act.
    Nevertheless, the Commission has decided to amend 10 CFR 12.101, 
12.102, and 12.103 to clarify its intent regarding the scope of 
coverage of the regulations. The amendment does not make express 
reference to any type of proceedings other than appeals under the 
Contract Disputes Act and adjudications conducted pursuant to the 
Program Fraud Civil Remedies Act, but it contains a general provision 
that will encompass other types of proceedings that may fall within the 
parameters of the EAJA. This leaves room for case-by-case 
determinations on applicants' claims of coverage in areas that have not 
been addressed previously by statute, case law, or express Commission 
interpretation.

III. Administrative Statements

Environmental Impact: Categorical Exclusion

    The NRC has determined that this regulation is the type of action 
described in categorical exclusion 10 CFR 51.22(c). Therefore, neither 
an environmental impact statement nor an environmental assessment has 
been prepared for this rule.

Paperwork Reduction Act Statement

    The information collection requirements contained in this rule are 
exempt from the Paperwork Reduction Act of 1980 (44 U.S.C. 3518(c)(1)).

Regulatory Analysis

    The EAJA provides that individuals and businesses that meet certain 
net worth and other requirements and prevail over the NRC in an 
adversary adjudication in which the NRC's position is not substantially 
justified may be awarded fees and expenses incurred in connection with 
the proceeding. Recent events, most notably the NRC's publication of a 
final rule implementing the Program Fraud Civil Remedies Act and 
actions thereunder, suggest that it is necessary for the NRC to adopt 
procedures to govern the receipt and determination of applications for 
EAJA fees. The procedures adopted mirror in important respects the 
model rule promulgated by the ACUS. The NRC has fulfilled the 
statutorily mandated process of consultation between the Chairman of 
the ACUS and the agency with respect to EAJA implementing procedures. 
See 5 U.S.C. 504(c)(1). The Commission believes that the procedures 
adopted are preferable to other procedural requirements that might be 
imposed. The foregoing discussion constitutes the regulatory analysis 
for this final rule.

Regulatory Flexibility Certification

    In accordance with the Regulatory Flexibility Act of 1980, 5 U.S.C. 
605(b), the Commission certifies that if promulgated, this rule will 
not have a significant economic impact on a substantial number of small 
entities. The rule merely will establish a procedural framework for the 
submission and determination of applications for fees and expenses 
incurred in participating in NRC adjudications and will not itself 
impose significant economic benefits or burdens.

Backfit Analysis

    The NRC has determined that the backfit rule, 10 CFR 50.109, does 
not apply to this rule, because these amendments do not involve any 
provisions which would impose backfits as defined in 10 CFR 
50.109(a)(1).

List of Subjects in 10 CFR Part 12

    Adversary adjudications, Award, Equal Access to Justice Act, Final 
disposition, Net worth, Party.

    For the reasons set out in the preamble and under the authority of 
the Atomic Energy Act of 1954, as amended, the Energy Reorganization 
Act of 1974, as amended, and 5 U.S.C. 552 and 553, the NRC is adopting 
a new 10 CFR part 12.
    1. A new part 12 is added to 10 CFR chapter I to read as follows:

PART 12--IMPLEMENTATION OF THE EQUAL ACCESS TO JUSTICE ACT IN 
AGENCY PROCEEDINGS

Subpart A--General Provisions

Sec.
12.101  Purpose.
12.102  When the EAJA applies.
12.103  Proceedings covered.
12.104  Eligibility of applicants.
12.105  Standards for awards.
12.106  Allowable fees and expenses.
12.107  Rulemaking on maximum rates for attorney fees.
12.108  Awards against other agencies.
12.109  Decisionmaking authority.

Subpart B--Information Required From Applicants

12.201  Contents of application.
12.202  Net worth exhibit.
12.203  Documentation of fees and expenses.
12.204  When an application may be filed.

Subpart C--Procedures for Considering Applications

12.301  Filing and service of documents.
12.302  Answer to application.
12.303  Reply.
12.304  Comments by other parties.
12.305  Settlement.
12.306  Further proceedings.
12.307  Decision.
12.308  Agency review.
12.309  Judicial review.
12.310  Payment of award.

    Authority: Sec. 203(a)(1), Pub. L. 96-481, 94 Stat. 2325 (5 
U.S.C. 504(c)(1)); Pub. L. 99-80, 99 Stat. 183.

Subpart A--General Provisions


Sec. 12.101  Purpose.

    The purpose of this Part is to state the regulatory requirements 
for award of attorney fees to eligible individuals and entities in 
certain administrative proceedings before the Nuclear Regulatory 
Commission, in implementation of the Equal Access to Justice Act, 5 
U.S.C. 504 (EAJA), which provides for the award of attorney fees and 
other expenses to parties to ``adversary adjudications'', as defined in 
5 U.S.C. 504(b)(1)(C). In general, an ``adversary adjudication'' is an 
adjudication that is required by statute to be determined on the record 
after opportunity for hearing before an agency of the United States and 
in which the position of the agency, or any component of the agency, is 
presented by an attorney or other representative who enters an 
appearance and participates in the proceeding. However, some agency 
adjudications are expressly excluded from coverage by 5 U.S.C. 504 
(e.g., an adjudication for the purpose of granting or renewing a 
license) even though they fall within this general definition, and 
certain appeals before an agency board of contract appeals and Program 
Fraud Civil Remedies Act hearings conducted under 31 U.S.C. ch. 38 are 
expressly covered.
    An eligible party may receive an award in an adversary adjudication 
when the party prevails over the Commission, unless the Commission's 
position was substantially justified or special circumstances make an 
award unjust. The regulations in this part describe the parties 
eligible for awards and the proceedings that are covered. They also 
explain how to apply for awards, and the procedures and standards that 
the Commission will use to make them.


Sec. 12.102  When the EAJA applies.

    The EAJA applies to any covered adversary adjudication pending or 
commenced before the Commission on or after August 5, 1985.


Sec. 12.103  Proceedings covered.

    (a) The EAJA applies to the following proceedings:
    (1) Hearings under the Program Fraud Civil Remedies Act (31 U.S.C. 
3801-12);
    (2) Any appeal of a decision made pursuant to section 6 of the 
Contract Disputes Act of 1978 (41 U.S.C. 605) before an agency board of 
contract appeals as provided in section 8 of that Act (41 U.S.C. 607); 
and
    (3) Adversary adjudications conducted by the Commission pursuant to 
any other statutory provision that requires a proceeding before the 
Nuclear Regulatory Commission to be so conducted as to fall within the 
meaning of ``adversary adjudication'' under 5 U.S.C. 504(b)(1)(C).
    (b) The Commission's failure to identify a type of proceeding as an 
adversary adjudication shall not preclude the filing of an application 
by a party who believes the proceeding is covered by the EAJA. Whether 
the proceeding is covered will then be an issue for resolution in 
proceedings on the application.
    (c) If a proceeding includes both matters covered by the EAJA and 
matters specifically excluded from coverage, any award made will 
include only fees and expenses related to covered issues.


Sec. 12.104  Eligibility of applicants.

    (a) To be eligible for an award of attorney fees and other expenses 
under the EAJA, the applicant must be a party to the adversary 
adjudication for which it seeks an award. The term ``party'' is defined 
in 5 U.S.C. 551(3). The applicant must show that it meets all 
conditions of eligibility set out in this subpart and in subpart B.
    (b) The types of eligible applicants are as follows:
    (1) An individual with a net worth of not more than $2 million;
    (2) The sole owner of an unincorporated business who has a net 
worth of not more than $7 million, including both personal and business 
interests, and not more than 500 employees;
    (3) A charitable or other tax-exempt organization described in 
section 501(c)(3) of the Internal Revenue Code (26 U.S.C. 501(c)(3)) 
with not more than 500 employees;
    (4) A cooperative association as defined in section 15(a) of the 
Agricultural Marketing Act (12 U.S.C. 1141j(a)) with not more than 500 
employees; and
    (5) Any other partnership, corporation, association, unit of local 
government, or organization with a net worth of not more than $7 
million and not more than 500 employees.
    (c) For the purpose of eligibility, the net worth and number of 
employees of an applicant shall be determined as of the date the 
proceeding was initiated.
    (d) An applicant who owns an unincorporated business will be 
considered as an ``individual'' rather than a ``sole owner of an 
unincorporated business'' if the issues on which the applicant prevails 
are related primarily to personal interests rather than to business 
interests.
    (e) The employees of an applicant include all persons who regularly 
perform services for remuneration for the applicant, under the 
applicant's direction and control. Part-time employees shall be 
included on a proportional basis.
    (f) The net worth and number of employees of the applicant and all 
of its affiliates shall be aggregated to determine eligibility. Any 
individual, corporation, or other entity that directly or indirectly 
controls or owns a majority of the voting shares or other interests of 
the applicant, or any corporation or other entity of which the 
applicant directly or indirectly owns or controls a majority of the 
voting shares or other interest, will be considered an affiliate for 
purposes of this part, unless the adjudicative officer determines that 
such treatment would be unjust and contrary to the purposes of the Act 
in light of the actual relationship between the affiliated entities. In 
addition, the adjudicative officer may determine that financial 
relationships of the applicant other than those described in this 
paragraph constitute special circumstances that would make an award 
unjust.
    (g) An applicant that participates in a proceeding primarily on 
behalf of one or more other persons or entities that would be 
ineligible is not itself eligible for an award.


Sec. 12.105  Standards for awards.

    (a) A prevailing applicant may receive an award for fees and 
expenses incurred in connection with a proceeding or a significant and 
discrete substantive portion of the proceeding, unless the position of 
the Commission over which the applicant has prevailed was substantially 
justified. The position of the Commission includes, in addition to the 
position taken by the Commission in the adversary adjudication, the 
action or failure to act by the Commission upon which the adversary 
adjudication is based. The burden of proof that an award should not be 
made to a prevailing applicant because the Commission's position was 
substantially justified is on the Commission counsel.
    (b) An award will be reduced or denied if the applicant has unduly 
or unreasonably protracted the proceeding or if special circumstances 
make the award sought unjust.


Sec. 12.106  Allowable fees and expenses.

    (a) Awards will be based on rates customarily charged by persons 
engaged in the business of acting as attorneys, agents, and expert 
witnesses, even if the services were made available without charge or 
at reduced rate to the applicant.
    (b) No award for the fee of an attorney or agent under this part 
may exceed $75.00 per hour. No award to compensate an expert witness 
may exceed the highest rate at which the Commission pays expert 
witnesses. However, an award may also include the reasonable expenses 
of the attorney, agent, or witness as a separate item, if the attorney, 
agent, or witness ordinarily charges clients separately for these 
expenses.
    (c) In determining the reasonableness of the fee sought for an 
attorney, agent, or expert witness, the adjudicative officer shall 
consider the following:
    (1) If the attorney, agent, or witness is in private practice, his 
or her customary fees for similar services, or, if an employee of the 
applicant, the fully allocated costs of the services;
    (2) The prevailing rate for similar services in the community in 
which the attorney, agent, or witness ordinarily performs services;
    (3) The time actually spent in the representation of the applicant;
    (4) The time reasonably spent in light of the difficulty or 
complexity of the issues in the proceeding; and
    (5) Other factors that bear on the value of the services provided.
    (d) The reasonable cost of any study, analysis, engineering report, 
test, project, or similar matter prepared on behalf of a party may be 
awarded, to the extent that the charge for the services does not exceed 
the prevailing rate for similar services, and the study or other matter 
was necessary for preparation of applicant's case.


Sec. 12.107  Rulemaking on maximum rates for attorney fees.

    (a) If warranted by an increase in the cost of living or by special 
circumstances (such as limited availability of attorneys qualified to 
handle certain types of proceedings), the Commission may adopt 
regulations providing that attorney fees may be awarded at a rate 
higher than $75 per hour in some, or all of the types of proceedings 
covered by this part. The Commission will conduct any rulemaking 
proceedings for this purpose under the informal rulemaking procedures 
of the Administrative Procedure Act.
    (b) Any person may file with the Commission a petition for 
rulemaking to increase the maximum rate for attorney fees, in 
accordance with the requirements of 10 CFR 2.802. The petition should 
identify the rate the petitioner believes the Commission should 
establish and the types of proceedings in which the rate should be 
used. It should also explain fully the reasons why the higher rate is 
warranted. Within 90 days after the petition is filed, the Commission 
will determine whether it will initiate a rulemaking proceeding, deny 
the petition, or take other appropriate action on the petition. The 
Commission will act on the petition in accordance with 10 CFR 2.803.


Sec. 12.108  Awards against other agencies.

    If an applicant is entitled to an award because it prevails over 
another agency of the United States that participates in a proceeding 
before the Commission and takes a position that is not substantially 
justified, the award or an appropriate portion of the award shall be 
made against that agency.


Sec. 12.109  Decisionmaking authority.

    Unless otherwise ordered by the Commission in a particular 
proceeding, each application under this part shall be assigned for 
decision to the official or decisionmaking body that entered the 
decision in the adversary adjudication. That official or decisionmaking 
body is referred to in this part as the ``adjudicative officer.''

Subpart B--Information Required From Applicants


Sec. 12.201  Contents of application.

    (a) An application for an award of fees and expenses under the EAJA 
shall identify the applicant and the proceeding for which an award is 
sought. The application shall show that the applicant has prevailed and 
identify the position of the Commission or other agency that the 
applicant alleges was not substantially justified. Unless the applicant 
is an individual, the application shall also state the number of 
employees of the applicant and describe briefly the type and purpose of 
its organization or business.
    (b) The application shall also include a statement that the 
applicant's net worth does not exceed $2 million (if an individual) or 
$7 million (for all other applicants, including their affiliates). 
However, an applicant may omit this statement if:
    (1) The applicant attaches a copy of a ruling by the Internal 
Revenue Service that it qualifies as an organization described in 
section 501(c)(3) of the Internal Revenue Code (26 U.S.C. 501(c)(3)) 
or, in the case of a tax-exempt organization not required to obtain a 
ruling from the Internal Revenue Service on its exempt status, a 
statement that describes the basis for the applicant's belief that it 
qualifies under this section; or
    (2) The applicant states that it is a cooperative association as 
defined in section 15(a) of the Agricultural Marketing Act (12 U.S.C. 
1141j(a)).
    (c) The application shall state the amount of fees and expenses for 
which an award is sought.
    (d) The application may also include any other matters that the 
applicant wishes the Commission to consider in determining whether, and 
in what amount, an award should be made.
    (e) The application shall be signed by the applicant or an 
authorized officer or attorney of the applicant. It shall also contain 
or be accompanied by a written verification under oath or under penalty 
of perjury that the information provided in the application is true and 
correct.


Sec. 12.202  Net worth exhibit.

    (a) Each applicant, except a qualified tax-exempt organization or 
cooperative association must provide with its application a detailed 
exhibit showing the net worth of the applicant and any affiliates (as 
defined in Sec. 12.104(f) of this part) when the proceeding was 
initiated. The exhibit may be in any form convenient to the applicant 
that provides full disclosure of the applicant's and its affiliates' 
assets and liabilities and is sufficient to determine whether the 
applicant qualifies under the standards in this part. The adjudicative 
officer may require an applicant to file additional information to 
determine its eligibility for an award.
    (b) Ordinarily, the net worth exhibit will be included in the 
public record of the proceeding. However, an applicant that objects to 
public disclosure of information in any portion of the exhibit and 
believes there are legal grounds for withholding it from disclosure may 
submit that portion of the exhibit directly to the adjudicative officer 
in a sealed envelope labeled ``Confidential Financial Information,'' 
accompanied by a motion to withhold the information from public 
disclosure. The motion shall describe the information sought to be 
withheld and explain, in detail, why it falls within one or more of the 
specific exemptions from mandatory disclosure under the Freedom of 
Information Act, 5 U.S.C. 552(b)(1)-(9), why public disclosure of the 
information would adversely affect the applicant, and why disclosure is 
not required in the public interest. The material in question shall be 
served on counsel representing the agency against which the applicant 
seeks an award, but need not be served on any other party to the 
proceeding. If the adjudicative officer finds that the information 
should not be withheld from disclosure, it shall be placed in the 
public record of the proceeding. Otherwise, any request to inspect or 
copy the exhibit shall be disposed of in accordance with the 
Commission's established procedures under the Freedom of Information 
Act, 10 CFR part 9, subpart A.


Sec. 12.203  Documentation of fees and expenses.

    The application shall be accompanied by full documentation of the 
fees and expenses, including the cost of any study, analysis, 
engineering report, test, project, or similar matter for which an award 
is sought. A separate itemized statement shall be submitted for each 
professional firm or individual whose services are covered by the 
application, showing the hours spent in connection with the proceeding 
by each individual, a description of the specific services performed, 
the rates at which each fee has been computed, any expenses for which 
reimbursement is sought, the total amount claimed, and the total amount 
paid or payable by the applicant or by any other person or entity for 
the services provided. The adjudicative officer may require the 
applicant to provide vouchers, receipts, logs, or other substantiation 
for any fees or expenses claimed, pursuant to Sec. 12.306 of this part.


Sec. 12.204  When an application may be filed.

    (a) An application may be filed whenever the applicant has 
prevailed in the proceeding or in a significant and discrete 
substantive portion of the proceeding, but in no case later than 30 
days after the date on which a decision or order disposing of the 
merits of the proceeding or any other complete resolution of the 
proceeding, such as a settlement or voluntary dismissal, becomes final 
and unappealable, both within the NRC and to the courts.
    (b) If after the filing of an application for an award, review or 
reconsideration is sought or taken of a decision as to which an 
applicant believes it has prevailed, proceedings for the award of fees 
shall be stayed pending final disposition of the underlying 
controversy. When the United States appeals the underlying merits of an 
adversary adjudication to a court, no decision on an application for 
fees and other expenses in connection with that adversary adjudication 
shall be made until a final and unreviewable decision is rendered by 
the court on the appeal or until the underlying merits of the case have 
been finally determined pursuant to the appeal.

Subpart C--Procedures for Considering Applications


Sec. 12.301  Filing and service of documents.

    Any application for an award or other pleading or document related 
to an application shall be filed and served on all parties to the 
proceeding in the same manner as other pleadings in the proceeding, 
except as provided in Sec. 12.202(b) for confidential financial 
information.


Sec. 12.302  Answer to application.

    (a) Within 30 days after service of an application, counsel 
representing the NRC against which an award is sought may file an 
answer to the application. Unless the NRC counsel requests an extension 
of time for filing or files a statement of intent to negotiate under 
paragraph (b) of this section, failure to file an answer within the 30-
day period may be treated as a consent to the award requested.
    (b) If the NRC counsel and the applicant believe that the issues in 
the fee application can be settled, they may jointly file a statement 
of their intent to negotiate a settlement. The filing of this statement 
shall extend the time for filing an answer for an additional 30 days, 
and further extensions may be granted by the adjudicative officer upon 
request by the NRC counsel and the applicant.
    (c) The answer shall explain in detail any objections to the award 
requested and identify the facts relied on in support of the NRC 
counsel's position. If the answer is based on any alleged facts not 
already in the record of the proceeding, the NRC counsel shall include 
with the answer either supporting affidavits or a request for further 
proceedings under Sec. 12.306.


Sec. 12.303  Reply.

    Within 15 days after service of an answer, the applicant may file a 
reply. If the reply is based on any alleged facts not already in the 
record of the proceeding, the applicant shall include with the reply 
either supporting affidavits or a request for further proceedings under 
Sec. 12.306.


Sec. 12.304  Comments by other parties.

    Any party to a proceeding other than the applicant and the NRC 
counsel may file comments on an application within 30 days after it is 
served, or on an answer within 15 days after it is served. A commenting 
party may not participate further in proceedings on the application 
unless the adjudicative officer determines that the public interest 
requires participation in order to permit full exploration of matters 
raised in the comments.


Sec. 12.305  Settlement.

    The applicant and the NRC counsel may agree on a proposed 
settlement of the award before final action on the application, either 
in connection with a settlement of the underlying proceeding, or after 
the underlying proceeding has been concluded, in accordance with the 
NRC's standard settlement procedure. If a prevailing party and the 
NRC's counsel agree on a proposed settlement of an award before an 
application has been filed, the application shall be filed with the 
proposed settlement.


Sec. 12.306  Further proceedings.

    (a) Ordinarily, the determination of an award will be made on the 
basis of the written record. However, on request of either the 
applicant or the NRC counsel, or on the adjudicative officer's own 
initiative, the adjudicative officer may order further proceedings, 
such as an informal conference, oral argument, additional written 
submissions or, as to issues other than substantial justification (such 
as the applicant's eligibility or substantiation of fees and expenses), 
pertinent discovery or an evidentiary hearing. Further proceedings 
shall be held only when necessary for full and fair resolution of the 
issues arising from the application, and shall be conducted as promptly 
as possible. Whether or not the position of the agency was 
substantially justified shall be determined on the basis of the 
administrative record, as a whole, which is made in the adversary 
adjudication for which fees and other expenses are sought.
    (b) A request that the adjudicative officer order further 
proceedings under this section shall specifically identify the 
information sought or the disputed issues and shall explain why the 
additional proceedings are necessary to resolve the issues.


Sec. 12.307  Decision.

    (a) The adjudicative officer shall issue an initial decision on the 
application within 90 days after completion of proceedings on the 
application. If the adjudicative officer fails to issue an initial 
decision within 90 days, he or she shall notify the parties of the 
reason for the delay and shall set a new deadline.
    (b) The initial decision shall include written findings and 
conclusions on the applicant's eligibility and status as a prevailing 
party, and an explanation of the reasons for any difference between the 
amount requested and the amount awarded. The decision shall also 
include, if at issue, findings on whether the NRC's position was 
substantially justified, whether the applicant unduly protracted the 
proceedings, or whether special circumstances make an award unjust. If 
the applicant has sought an award against more than one agency, the 
decision shall allocate responsibility for payment of any award made 
among the agencies, and shall explain the reasons for the allocation 
made.


Sec. 12.308  Agency review.

    (a) Either the applicant or the NRC counsel may seek review of the 
initial decision on the fee application, or the Commission may decide 
to review the decision on its own initiative, in accordance with the 
Commission's review procedures set out in 10 CFR 2.786. The filing of a 
petition for review is mandatory for a party to exhaust its 
administrative remedies before seeking judicial review. If neither the 
applicant nor NRC counsel seeks review and the Commission does not take 
review on its own initiative, the initial decision on the application 
shall become a final decision of the NRC forty (40) days after it is 
issued.
    (b) Notwithstanding anything to the contrary in any other part of 
the Commission's regulations, the initial decision shall be inoperative 
(i.e., the decision shall not be final and any award made shall not be 
paid) until the later of--
    (1) The expiration of the forty-day period provided in paragraph 
(a) of this section; or
    (2) If within the forty-day period provided in paragraph (a) of 
this section the Commission elects to review the decision, the 
Commission's issuance of a final decision on review of the initial 
decision.
    (c) Whether to review a decision on its own motion is a matter 
within the discretion of the Commission. If review is taken, the 
Commission will issue a final decision on the application or remand the 
application to the adjudicative officer for further proceedings.


Sec. 12.309  Judicial review.

    Judicial review of final agency decisions on awards may be sought 
as provided in 5 U.S.C. 504(c)(2).


Sec. 12.310  Payment of award.

    An applicant seeking payment of an award shall submit to the 
appropriate official of the paying agency a copy of the Commission's 
final decision granting the award, accompanied by a certification that 
the applicant will not seek review of the decision in the United States 
courts. Where the award is granted against the Commission, the 
applicant shall make the submission to the Director, Division of 
Accounting and Finance, Office of the Controller, U.S. Nuclear 
Regulatory Commission, Washington, DC 20555. The NRC will pay the 
amount awarded to the applicant within 60 days.

    Dated at Rockville, Maryland, this 29th day of April 1994.

    For the Nuclear Regulatory Commission.
John C. Hoyle,
Assistant Secretary of the Commission.
[FR Doc. 94-10729 Filed 5-4-94; 8:45 am]
BILLING CODE 7590-01-P