[Federal Register Volume 63, Number 232 (Thursday, December 3, 1998)]
[Rules and Regulations]
[Pages 66721-66735]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-32211]


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NUCLEAR REGULATORY COMMISSION

10 CFR Parts 2 and 51

RIN 3150-AG09


Streamlined Hearing Process for NRC Approval of License Transfers

AGENCY: Nuclear Regulatory Commission.

ACTION: Final rule.

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SUMMARY: The Nuclear Regulatory Commission is amending its regulations 
to provide specific uniform procedures and rules of practice for 
handling requests for hearings associated with license transfer 
applications involving material and reactor licenses as well as 
licenses issued under the regulations governing the independent storage 
of spent nuclear fuel and high-level radioactive waste. Conforming 
amendments are also made to certain other parts of the Commission's 
regulations. These new provisions provide for public participation and 
opportunity for an informal hearing on matters relating to license 
transfers, specify procedures for filing and docketing applications for 
license transfers, and assign appropriate authorities for issuance of 
administrative amendments to reflect approved license transfers. This 
rulemaking also adds a categorical exclusion that permits processing of 
transfer applications without preparation of Environmental Assessments.

EFFECTIVE DATE: December 3, 1998.

FOR FURTHER INFORMATION CONTACT: James A. Fitzgerald, U.S. Nuclear 
Regulatory Commission, Washington, D.C. 20555-0001, telephone (301) 
415-1607, e-mail [email protected], or Leo Slaggie, U.S. Nuclear Regulatory 
Commission, Washington, D.C. 20555, telephone (301) 415-1605 (TDD), e-
mail [email protected].

SUPPLEMENTARY INFORMATION:

I. Background

    On September 11, 1998 (63 FR 48644), the NRC published in the 
Federal Register a proposed rule that would amend NRC's regulations by 
adding to 10 CFR Part 2, the NRC's Rules of Practice for Domestic 
Licensing Proceedings and Issuance of Orders, a subpart M, which would 
establish uniform informal procedures for handling requests for 
hearings associated with license transfer applications. This initiative 
is part of a broad effort to improve the effectiveness of the agency's 
programs and processes.
    A number of categories of NRC licensees, but in particular the 
electric power industry, have undergone and will continue to undergo 
significant transformations as a result of changes to the economic and 
regulatory environment in which they operate. Electric utilities in 
particular are now operating in an environment which is increasingly 
characterized by restructuring and organizational change. In recent 
years, the Commission has seen a significant increase in the number of 
requests for transfers of NRC licenses. The number of requests related 
to reactor licenses has increased from a historical average of 2-3 per 
year to more than 20 requests in fiscal year 1997. With the 
restructuring that the energy industry is undergoing, the Commission 
expects this high rate of requests for approval of license transfers to 
continue. Because of the need for expeditious decisionmaking from all 
agencies, including the Commission, for these kinds of transactions, 
timely and effective resolution of requests for transfers on the part 
of the Commission is essential.
    In general, license transfers do not involve any technical changes 
to plant operations. Rather, they involve changes in ownership or 
partial ownership of facilities at a corporate level. Section 184 of 
the Atomic Energy Act of 1954, as amended (AEA), specifies, however, 
that:

    [N]o license granted hereunder * * * shall be transferred, 
assigned, or in any manner disposed of, either voluntarily or 
involuntarily, directly or indirectly, through

[[Page 66722]]

transfer of control of any license to any person, unless the 
Commission shall, after securing full information, find that the 
transfer is in accordance with the provisions of this Act, and shall 
give its consent in writing. (42 U.S.C. 2234; 10 CFR 30.34 (b), 
40.46, 50.80, 72.50)

    Transfers falling within the foregoing provision include indirect 
transfers which might entail, for example, the establishment of a 
holding company over an existing licensee, as well as direct transfers, 
such as transfer of an ownership interest held by a non-operating, 
minority owner, and the complete transfer of the ownership and 
operating authority of a single or majority owner. Although other 
requirements of the Commission's licensing provisions may also be 
addressed to the extent relevant to the particular transfer action, 
typical NRC staff review of such applications consists largely of 
assuring that the ultimately licensed entity has the capability to meet 
financial qualification and decommissioning funding aspects of NRC 
regulations. These financial capabilities are important over the long 
term, but have no direct or immediate impact on the requirements for 
day-to-day operations at a licensed facility. The same is generally 
true of applications involving the transfer of materials licenses.
    Notwithstanding the nature of the issues relevant to a decision on 
whether to consent to a license transfer, past Commission practice has 
generally involved the use of formal hearing procedures under the 
provisions of 10 CFR Part 2, Subpart G, for license transfers other 
than those for materials licenses, which have used the informal hearing 
procedures provided by 10 CFR Part 2, Subpart L. However, license 
transfers do not, as a general proposition, involve the type of 
technical issues with immediate impact on the actual operation of the 
facilities that might benefit from review by a multi-member, multi-
disciplined Atomic Safety and Licensing Board historically used by the 
Commission in hearings on initial licensing or license amendments that 
substantially affect the technical operations. It is a matter suitable 
for reasonable discussion whether such complex hearing procedures 
provide the best means of reaching decisions on such technical issues, 
but, be they the best or not, they clearly are not required and are not 
the most efficient means for resolving the issues encountered in 
license transfers. Accordingly, the Commission has determined that 
requests for hearings on applications for license transfers should be 
handled by a separate Subpart of 10 CFR Part 2. This new Subpart M 
establishes an efficient and appropriate informal process for handling 
hearing requests associated with transfer applications commensurate 
with the nature of the issues involved and the rights of all parties.
    The basic requirement for an opportunity for a hearing on a license 
transfer is found in Section 189.a of the Atomic Energy Act of 1954, as 
amended (AEA), which provides that:

    [I]n any proceeding under this Act, for the granting, 
suspending, revoking, or amending of any license or construction 
permit, or application to transfer control, * * * the Commission 
shall grant a hearing upon the request of any person whose interest 
may be affected by the proceeding, and shall admit any such person 
as a party to such proceeding. (42 U.S.C. 2239(1).)

    The Commission believes that AEA sections 184 and 189 give the 
Commission the flexibility to fashion procedures which provide for a 
fair process to consider any issues raised concerning license transfers 
while still proceeding in an expedited manner. In 1983, a reviewing 
court held that Section 189.a of the Atomic Energy Act did not require 
that a hearing on a materials license amendment be conducted ``on the 
record.'' City of West Chicago v. U.S. Nuclear Regulatory Commission, 
701 F.2d 632, 641-45 (7th Cir. 1983). There, the court declined to read 
Section 189.a as requiring formal trial-type hearings, in the absence 
of clear Congressional ``intent to trigger the formal on-the-record 
hearing provisions of the APA.'' Id. at 641. The Commission has also 
taken the position in court that Section 189.a does not require 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). However, the court did not 
find it necessary to decide the question. Nuclear Information Resource 
Services v. NRC, 969 F.2d 1169, 1180 (D.C. Cir. 1992).
    To promote uniformity, the hearing procedures established in the 
final rule apply to all license transfers which require prior NRC 
approval. The Commission has added to the final rule, as appropriate, 
additional language to make explicit that the new procedures apply to 
transfers of licenses issued under 10 CFR Part 72 for independent 
storage of spent nuclear fuel and high level radioactive waste. The 
procedures are designed to provide for public participation in the 
event of requests for a hearing under these provisions, while at the 
same time providing an efficient process that recognizes the time-
sensitivity normally present in transfer cases.

II. Comments and Commission Responses

    The Commission received sixteen letters of comment from interested 
persons. Commenters included private corporations who hold or plan to 
acquire NRC licenses for nuclear facilities, the Nuclear Energy 
Institute, private counsel representing electric utilities and nuclear 
plant operating companies, a licensed nuclear power plant operator 
employed at a nuclear power station, the president of Local 369 of the 
Utility Workers Union of America representing workers at a nuclear 
power station, a citizens group, and an individual member of the 
public. Twelve of the Commenters expressed strong support for the 
proposed rule and provided specific comments and suggestions on 
particular provisions. Two Commenters, the individual member of the 
public and the citizens group, indicated strong but general opposition 
to the proposed Subpart M hearing process.
    A review of the comments, not necessarily in the order received, 
and the Commission's responses follows:
    Comments from individuals:
    Comment 1. Mr. Marvin Lewis, a member of the public, opposed the 
adoption of informal procedures for hearings on license transfer 
applications. Mr. Lewis's brief comment expressed concern that under 
the proposed procedures there will be no record upon which findings of 
fact and conclusions of law may rest and that ``general findings'' will 
suffice to support a license transfer.
    Commission response. The Commission believes the commenter has not 
fully understood the proposal. While the procedures do not allow 
discovery as such, there will be an extensive record consisting of the 
hearing transcript, exhibits, and all papers filed or issued in 
connection with the hearing. See Sec. 2.1317. The Presiding Officer 
will certify the completed hearing record to the Commission, which will 
then issue its decision on the issues raised in the hearing or request 
additional testimony and/or documentary evidence if it finds that 
additional evidentiary presentations are needed for a decision on the 
merits. See Sec. 2.1320. The Commission does not understand Mr. Lewis's 
reference to ``general findings'' in the context of this rulemaking. 
Before approving a license transfer the Commission must find that the 
transfer is in accordance with the provisions of

[[Page 66723]]

the Atomic Energy Act (42 U.S.C. 2234). This finding will necessarily 
address the specifics of the transfer in question. Nothing in the rule 
alters the nature of the findings needed to support approval of a 
license transfer.
    Comment 2. The Ohio Citizens for Responsible Energy (``OCRE'') 
generally opposed the proposed rule. OCRE characterizes the Subpart M 
informal procedures as ``a pro forma exercise'' that in OCRE's view 
will not be adequate to deal with the complex inquiry that could arise 
in a license transfer proceeding. OCRE also objects to shortened filing 
times and to the requirement that common interests be represented by a 
single party. OCRE sees such provisions as ``attempts to make life 
difficult for intervenors.''
    Commission response. For the reasons given in the notice of 
proposed rulemaking, the Commission believes that the Subpart M 
procedures will be both efficient and effective in dealing with the 
issues that license transfer application proceedings typically involve. 
They are not ``pro forma'' but in fact provide ample opportunity for 
the parties to raise appropriate issues and build a sound evidentiary 
record for decision. At the same time, the Commission recognizes that 
issues might arise that could require additional procedures. Therefore 
the rule explicitly provides that the Commission may use additional 
procedures or even convene a formal hearing ``on specific and 
substantial disputes of fact necessary for the Commission's decision, 
that cannot be resolved with sufficient accuracy except in a formal 
hearing.'' See Sec. 2.1322(d). The rule thus provides sufficient 
flexibility to cope with extraordinary or unusual cases. For typical 
cases, however, a ``streamlined hearing process'' providing faster 
decision-making without loss of quality is a desirable objective. The 
shortened filing times and other provisions to which OCRE objects are 
steps which make this streamlining possible. They are not selective 
attempts to burden intervenors. The Commission believes that all 
parties to a license transfer application proceeding will benefit from 
the use of the Subpart M procedures.
    Comment 3. Mr. David Leonardi, a licensed reactor operator, 
submitted a two-part comment ``directed more to what is missing in the 
proposed rule rather than to what it contains.'' First, Mr. Leonardi 
questioned the Commission's statement in the notice of proposed 
rulemaking that license transfers in general ``do not involve . . . 
significant changes in personnel of consequence to the continued 
reasonable assurance of public health and safety.'' Mr. Leonardi called 
this ``a dangerous assumption'' and expressed his view that 
``significant losses of critical personnel must be anticipated and 
factored into the transfer decision.'' He suggested that the proposed 
rule ``must require the applicant to submit a critical staff retention 
plan.''
    Second, with regard to the placement in the Public Document Room of 
documents pertaining to each license transfer application, Sec. 2.1303, 
Mr. Leonardi commented that he finds the Public Document Room difficult 
to use. He indicated his preference for ``a separate section on the NRC 
web site for each proposed license transfer where all relevant 
documents and correspondence may be accessed.''
    Commission response. Mr. Leonardi is correct that if a significant 
loss and replacement of critical plant personnel can be anticipated as 
the result of a particular license transfer this might well be a reason 
not to approve the transfer or to condition the transfer on the 
maintenance of adequate technical qualifications. However, the 
Commission does not regard this observation as a reason for modifying 
this proposed rule, which deals with hearing procedures rather than 
with the substantive findings that must be made to support approval of 
a license transfer application. The commenter does not assert that the 
Subpart M procedures cannot deal adequately with the issue of technical 
qualifications of the applicant for license transfer, and the 
Commission perceives no potential inadequacy in this regard. The 
Commission continues to believe that personnel retention issues and 
technical qualifications of the applicant do not involve the type of 
technical questions bearing on the actual operation of a facility that 
may benefit from different hearing procedures. As for the commenter's 
suggestion that the rule should incorporate a requirement for a 
critical staff retention plan to be submitted by the applicant for the 
license transfer, the Commission finds that Subpart M, which deals 
primarily with hearing procedures, is not an appropriate place for such 
a substantive requirement. If, in a particular license transfer case, a 
need is identified for submission of a critical staff retention plan in 
order to address the applicant's technical qualifications, this matter 
can readily be addressed in the hearing process and can ultimately 
result in a condition on license transfer approval.
    Turning to the matter of availability of license transfer 
application documents on the NRC web site, the Commission notes that 
the NRC is in the process of developing a new and comprehensive 
Agencywide Documents Access and Management System (``ADAMS''). 
Documents filed in a license transfer case after ADAMS becomes 
operational, probably in the second half of 1999, will be placed in the 
ADAMS public library. The public will be able to find relevant 
documents by using general search criteria such as docket numbers, case 
names, and subject topics. The details of how ADAMS will operate have 
yet to be fully worked out, but the Commission believes that this 
system will prove responsive to the commenter's concern. In the 
meantime, the Commission notes that the NRC Public Document Room 
licensing files have worked quite well in the past and been readily 
available to members of the public who wish to obtain extensive 
information on pending licensing actions.
    Comment 4. A comment by the president of Local 369, Utility Workers 
Union of America, representing 197 workers at a nuclear power station, 
acknowledged the need to streamline the hearing process but identified 
what the commenter perceived as potential problems with the proposed 
Subpart M procedures. In particular, the commenter was concerned about 
the Commission's expectation that the procedures will result in the 
issuance of a final Commission decision on a license transfer 
application within about six to eight months of notice of receipt of 
the application. The commenter said that ``a process that proceeds too 
rapidly could compromise the Union's and the NRC's ability to obtain 
critical information about the license transferee.'' The Commission of 
course agrees that what the commenter calls ``a rush to approval'' 
could fail to obtain adequate information about the transferee's 
experience and ability to manage the plant safely. The Commission 
notes, however, that the expectation of completing license transfer 
proceedings in six to eight months applies to ``routine cases.'' (63 FR 
48646, col. 2.) Subpart M itself does not specify or limit the 
substantive questions which must be addressed in license transfer 
proceedings. If difficult issues arise in unusual cases, they will be 
dealt with as sound decisionmaking requires, even if this requires a 
greater time commitment than routine cases. The Commission's aim in 
adopting the Subpart M procedures is to provide an efficient and 
effective hearing process and a structure for compiling a decision 
record in a timely manner, not a hurried one.
    The commenter also expressed concern that the Union not be denied 
the opportunity to participate in license transfer hearings. The new 
Subpart M

[[Page 66724]]

does not alter the Commission's usual requirement for standing to 
intervene in a proceeding that a person show an interest which may be 
affected by the outcome of the proceeding. By showing an interest 
(within the ``zone of interests'' of the relevant statutes) which may 
be affected by the Commission's action on an application for license 
transfer, any person or organization may participate as of right. See 
Sec. 2.1306(a). Under current agency case law, the Commission may also 
allow discretionary intervention to a person who does not meet standing 
requirements, where there is reason to believe the person's 
participation will make a valuable contribution to the proceeding and 
where a consideration of the other criteria on discretionary 
intervention shows that such intervention is warranted.
    Comments by or on behalf of members of the nuclear energy industry:
    Comment 5. The Nuclear Energy Institute (``NEI''), an organization 
representing utilities licensed to operate commercial nuclear power 
plants in the United States, nuclear materials licensees, and other 
organizations and individuals involved in the nuclear industry, 
submitted a comment on behalf of its members. NEI supports as a ``very 
positive development'' the use of informal rather than formal trial-
type procedures for consideration of license transfer applications. NEI 
suggests the goals of the rule can be furthered by the following 
proposed clarification: ``Where the proposed change only involves a 
transfer of ownership of all or a portion of the facility, both NRC 
staff review and the Subpart M proceeding should be limited solely to 
the capability of the transferee to meet financial qualifications and 
decommissioning funding requirements.'' Several comments by individual 
members of the nuclear energy industry or their representatives 
endorsed the comments of NEI.
    Commission response. The Commission does not accept NEI's proposed 
clarification. The Commission observed in the Notice of Proposed 
Rulemaking that ``typical staff review consists largely of assuring 
that the ultimately licensed entity has the capability to meet 
financial qualification and decommissioning funding aspects of NRC 
regulations,'' (63 FR 48644, col. 3. (emphasis added)). But financial 
qualification and decommissioning funding are not the sole issues that 
may bear on a license transfer approval, even when the transfer will 
change only the ownership of all or part of a facility and will not 
directly affect management or operation. Section 103d of the Atomic 
Energy Act, 42 U.S.C. 2133, for example, places certain restrictions on 
foreign ownership, control, or domination of certain licenses. 
Consideration of the question whether a proposed license transfer is 
consistent with this provision of the Act would require a broader scope 
for the proceeding than the limited one NEI recommends. Generally, the 
Commission believes it is desirable to focus its Subpart M rulemaking 
solely on procedures rather than attempting in this rulemaking to 
describe and enumerate the substantive issues that license transfers 
may involve.
    Comment 6. The Southern California Edison Company (``SCE'') stated 
its strong support for the proposed rule. SCE supported the comments 
submitted by the Nuclear Energy Institute, which the Commission has 
already addressed in the response to Comment 5, supra. SCE also offered 
suggestions for ``minor enhancements'' to the proposed rule, which the 
Commission addresses in its response to this comment.
    Commission response. Change (1) suggested by SCE is that the rule 
should give the Presiding Officer, in addition to the power to ``strike 
or reject duplicative or irrelevant presentations,'' Sec. 2.1320(a)(9), 
the responsibility and power to strike or reject unreliable or 
immaterial presentations. As the commenter points out, this change 
would make Subpart M similar in this regard to 10 CFR Part 2, Subpart 
L, Informal Hearing Procedures for Adjudications in Materials and 
Operator Licensing Proceedings, which gives the presiding officer the 
power to strike portions of a presentation that are ``cumulative, 
irrelevant, immaterial, or unreliable.'' (10 CFR 2.1233(e)). The 
Commission agrees that unreliable and immaterial presentations detract 
from the value of the record and should be subject to exclusion in the 
sound discretion of the Presiding Officer. Therefore the Commission 
accepts this suggestion and has revised Sec. 2.1320(a)(9) accordingly 
in the final rule.
    Change (2) suggested by SCE deals with responses to papers served 
by mail. SCE notes that proposed Sec. 2.1314(c) provides for three 
additional days to respond to papers served pursuant to Sec. 2.1307 by 
regular mail. SCE suggests that three additional days for mail service 
should be allowed for all responses to service of a paper, not just 
those made pursuant to Sec. 2.1307. The Commission accepts this 
suggestion and has revised Sec. 2.1314(c) accordingly in the final 
rule.
    Change (3) suggested by SCE is that proposed Sec. 2.1331(b) be 
clarified to make plain that the Commission may consider other 
information on the docket when it decides matters that were not 
designated as issues for the hearing. The Commission agrees and has 
adopted the language proposed by SCE for Sec. 2.1331(b) in the final 
rule: ``The decision on issues designated for hearing pursuant to 
Sec. 2.1308(d)(1) will be based on the record developed at the 
hearing.''
    Comment 7. Florida Power & Light Company (``FPL'') submitted a 
comment endorsing the comments of the Nuclear Energy Institute, which 
the Commission has already addressed in the context of its response to 
comment 5, supra. FPL concurred with the Commission's findings in 
support of the proposed Subpart M and offered the following additional 
suggestions:
    (1) FPL suggested that the Commission should extend the informal 
hearing process to all NRC adjudicatory proceedings.
    Commission response. Although the suggestion goes well beyond the 
scope of the proposed rule, the Commission notes elsewhere in this 
notice that it has argued in court that section 189a of the Atomic 
Energy Act does not require formal hearings, and the Commission has 
directed the staff to seek legislation that supports greater use of 
informal procedures. The Commission has also asked the staff to advise 
the Commission on ways to enhance the Commission's ability to use 
informal procedures in any proceeding in which formal procedures are 
currently used.
    (2) FPL supported close Commission oversight of the Presiding 
Officer but believed that the Commissioners should not personally be 
involved, as the proposed Subpart M envisions, in developing the 
evidentiary record in license transfer application proceedings.
    Commission response. Under the proposed rule the Commission ``will 
ordinarily be the Presiding Officer at a hearing,'' but the Commission 
``may provide * * * that one or more Commissioners, or any other person 
permitted by law, may preside.'' See Sec. 2.1319. The Commission 
believes this language provides sufficient flexibility to deal with the 
commenter's concerns, should the Commission perceive that its direct 
involvement in Subpart M hearings is in some cases unduly burdensome or 
impractical for the Commission.
    (3) FPL stated its belief that allowing all parties to make oral 
presentations in every license transfer proceeding ``could defeat the 
underlying purpose of the proposed rule: to streamline license transfer 
proceedings.'' Comments by several other members of the nuclear

[[Page 66725]]

energy industry or their representatives questioned the proposed rule's 
provision that hearings shall be oral unless all parties agree to a 
hearing on written submissions. These Commenters recognized the 
Commission's intention to avoid delays caused by a need to consider a 
party's request that a hearing be oral; that is, the Commission intends 
to avoid needless nonsubstantive ``litigation'' over the form (oral or 
written) of the litigation on the merits-- but noted that there are 
alternative ways to avoid these delays. Two Commenters suggested that 
the Commission could provide that hearings will be on written 
submissions unless any party requests an oral hearing.
    Commission response. Under the proposed Subpart M oral hearings are 
the ``default choice'' in that it provides for oral presentations 
unless all parties agree to a written hearing. Under the proposed 
scheme if the parties take no action the hearing will be oral, and only 
unanimous action of the parties in favor of a written hearing will 
cause oral procedures to be supplanted. The Commenters' suggested 
alternative that the hearing be written unless a party requests an oral 
hearing would turn this around and make a written hearing the default 
choice. The Commission prefers to retain the approach taken in the 
proposed rule. The Commission believes that oral presentations with the 
structure established by Subpart M may allow for the compilation of a 
better record because the Presiding Officer can more readily ask 
follow-up or clarifying questions. A strictly written hearing is likely 
to prove more cumbersome in this regard. Furthermore, members of the 
public attending oral proceedings will be able to follow the hearing 
more readily than by combing through extensive written materials in the 
Public Document Room as they would be required to do in a written 
hearing context. Accordingly, the Commission does not accept the 
commenter's proposed alternative.
    (4) FPL noted its support of Commission action to ensure timely 
completion of license transfer proceedings but recommended ``that the 
final rule specifically require automatic Commission review in the 
event that any of the schedular ``milestones'' are exceeded by a 
Presiding Officer.''
    Commission response. Although the Commission intends to monitor 
these proceedings carefully and will be fully prepared to step in to 
address schedular problems when necessary, the Commission is not 
prepared to require by regulation, and bind itself to, a review of 
every instance in which a Presiding Officer exercises discretion to 
enlarge the time provided in the rule for filings or other actions. In 
view of the Commission's recent Policy Statement on Conduct of 
Adjudicatory Proceedings, 48 NRC 18 (1998), (63 FR 41872; August 5, 
1998), the Commission is confident that persons serving as Presiding 
Officers will be highly sensitive to the need for expeditious 
completion of adjudicatory proceedings, consistent with considerations 
of fairness and the production of an adequate record, and will 
countenance delays only for compelling reasons. The Commission of 
course retains discretion to take such action in individual proceedings 
as it deems necessary to assure timeliness and adherence to all other 
Commission requirements that govern the hearing process.
    Comment 8. Texas Utilities Electric Company (``TU Electric'') 
expressed support for the proposed rule. TU Electric also offered many 
of the suggestions put forward in the comments already described. In 
addition, TU Electric expressed concern that the reference in proposed 
Sec. 2.1330(b) to 10 CFR 2.790, which is in Subpart G, might convey an 
implication that other Subpart G procedures also apply in Subpart M 
proceedings.
    Commission response. To allay the commenter's concern, the 
Commission has modified Sec. 2.1330(b) in the final rule by replacing 
the language ``under 10 CFR 2.790'' with the language ``in accordance 
with law and policy as reflected in 10 CFR 2.790 . . .'' The intent of 
this modification is to remove any possible implication that Subpart G 
is intended to apply to license transfer actions.
    Comment 9. AmerGen Energy Company, LLC (``AmerGen'') commented that 
it favored the proposed rule and urged its prompt adoption. AmerGen 
also suggested that the Commission should apply the proposed Subpart M 
procedures, at the request of an applicant, in any license transfer 
application proceedings that may be undertaken before the final Subpart 
M becomes effective. In AmerGen's opinion, the NRC has authority under 
the Atomic Energy Act and the Administrative Procedure Act to use the 
Subpart M procedures on a case-by-case basis, prior to finalization of 
the rule, so long as the Commission provides fair notice to the 
potential parties.
    Commission response. For reasons discussed elsewhere in this 
notice, the Commission is making this rule effective upon publication, 
pursuant to the provisions of the Administrative Procedure Act for 
immediate effectiveness. 5 U.S.C. 553(d)(1) and 553(d)(3). Any 
applications received but not yet noticed as of the effective date of 
this rule will be subject to Subpart M procedures. In the case of 
license transfer applications, if any, that have been noticed and for 
which proceedings are pending as of the date of this notice of final 
rulemaking, affected applicants or parties to such proceedings who wish 
to avail themselves of the new procedures may file motions with the 
Presiding Officer in those proceedings, requesting that Subpart M 
procedures be applied as appropriate to the remainder of the pending 
proceeding.
    Comment 10. Morgan, Lewis, & Bockius, a private law firm commenting 
on behalf of Alliant Utilities--IES Utilities and STP Nuclear Operating 
Company, endorsed the comments of NEI (see Comment 5, supra) in support 
of the rule. The commenter also made several suggestions for changes.
    Commission response. The changes suggested by this commenter are 
similar to suggestions made in other comments described and responded 
to in the preceding discussion.
    Comment 11. Shaw, Pittman, Potts & Trowbridge (``Shaw Pittman''), a 
private law firm commenting on behalf of itself and several utilities, 
strongly supported the proposed rule. Shaw Pittman believed, however, 
that several aspects of the rule require ``clarification and 
refinement.'' These aspects, together with the Commission's response, 
are as follows:
    (1) Shaw Pittman expressed concern ``that the rule does not 
identify the circumstances that would permit the NRC Staff to delay the 
approval or denial of a license transfer request pending any requested 
hearing.'' The commenter noted that proposed Sec. 2.1316(a) says that 
during the pendency of a hearing under Subpart M ``the staff is 
expected to promptly issue approval or denial of license transfer 
requests.'' The commenter believed that the final rule or its statement 
of consideration ``should describe the circumstances or the factors 
that the NRC Staff are to consider in deciding whether to postpone 
approval or denial of a transfer pending a requested hearing.''
    Commission response. The Commission does not accept this 
suggestion. As noted previously (see response to Comment 5), the scope 
and focus of the Subpart M rulemaking are on procedures for the conduct 
of hearings, rather than the substantive questions involved in approval 
of license transfer applications. The Commission is confident that the 
present language of Sec. 2.1316(a) adequately conveys to the NRC staff 
that staff action on license transfer requests

[[Page 66726]]

should not be delayed except for sound reasons. The Commission relies 
on the staff, subject to Commission oversight, to exercise good 
judgment in this regard. As the rule indicates, the Commission believes 
that staff approval or denial can usually be issued promptly, but it 
would be unwise for the Commission at this point to attempt to 
anticipate all the circumstances that might warrant delay in the 
staff's review or action on the application.
    (2) Shaw Pittman commented that the Commission ``should clarify the 
evidentiary value of written position statements and oral presentations 
allowed under the present rule.'' The commenter would have the rule 
specify that the Commission cannot base a decision on ``written 
position statements and oral presentations, in and of themselves.'' The 
commenter would require parties to document and support their positions 
by written testimony with supporting affidavits.
    Commission response. The Commission does not believe that extensive 
clarification is necessary. Setting out evidentiary requirements in 
more detail could be at variance with the Commission's intention to 
move away from time-consuming formality in its hearing processes. In 
making a decision based on the record produced in a Subpart M 
proceeding, the Commission will of course take proper account of the 
evidentiary value of the record material. Written statements of 
position and oral arguments will be treated as such statements and 
arguments are treated in the NRC's formal adjudications under Subpart G 
and informal proceedings under Subpart L, i.e. as arguments and 
positions of the parties but not as facts. Factual assertions 
unsupported by affidavits, expert testimony, or other appropriate 
evidentiary submissions are less likely to carry weight than assertions 
with proper evidentiary support.
    (3) Shaw Pittman urged the Commission to revise the proposed rule 
expressly to allow parties to submit proposed questions to the 
Presiding Officer within seven days of the filing of rebuttal 
testimony. The commenter noted that under the proposed rule, rebuttal 
testimony and proposed questions for the Presiding officer to ask 
witnesses in the Presiding Officer's examination are to be filed at the 
same time. See Sec. 2.1321(b) and Sec. 2.1322(a)(2). Thus, there is no 
explicit provision for proposing questions directed to the rebuttal 
testimony itself, although the Presiding Officer has the discretion to 
provide for such questions. The commenter believed that the timeframe 
of the rule would reasonably allow for this additional filing without 
extending the date for commencement of the oral hearing beyond 65 days 
after the date of the Commission's notice granting a hearing.
    Commission response. The Commission finds the commenter's point 
well-taken and has placed language in the final rule to authorize 
proposed questions directed to rebuttal testimony to be filed within 
seven days of the filing of the rebuttal testimony.
    (4) Shaw Pittman finds confusing the language of proposed 10 CFR 
2.1323(a) that ``[a]ll direct testimony in an oral hearing shall be 
filed no later than 15 days before the hearing.* * *'' The commenter 
believes this language ``could arguably be read to allow the filing of 
direct testimony subsequent to the 30 day deadline provided for by 
proposed 10 CFR 2.1322(a)(1).''
    Commission response. The Commission does not see any reason for 
confusion. To be timely the filings in question must be made within 30 
days after the date of the Commission's notice granting a hearing 
[Sec. 2.1322(a)] but in any event no later than 15 days before the 
hearing [Sec. 2.1323(a)]. There is no potential contradiction between 
the two provisions. Rather than being an unnecessary provision, as the 
commenter asserts, Sec. 2.1323(a) assures that parties will receive 
filings in adequate time to prepare for the oral hearing.
    (5) Shaw-Pittman asked that the Commission clarify in its 
promulgation of the final rule the extent to which license transfer 
applications filed before the effective date of the rule will be 
subject to the new Subpart M procedures. The commenter favored making 
the new rule immediately effective and applying the Subpart M 
procedures to pending applications.

Commission response. See the Commission's response to Comment 9.

    Comment 12. GPU Nuclear stated its strong support for the rule and 
recommended that the new procedures be applied as soon as possible.

Commission response. See the Commission's response to Comment 9.

    Comment 13. Duke Energy Company (``Duke''), represented by Winston 
& Strawn, supported the proposed rule but expressed concern about the 
elimination of cross-examination by parties under Subpart M. Duke 
stated that ``the final rule should retain provisions allowing the 
parties to present recommended questions to the presiding officer.'' 
Duke commented that the final rule ``should define with greater 
precision the types of issues appropriate for review * * * '' and 
suggested limiting the proceedings to issues associated with financial 
qualifications and decommissioning funding. Duke also commented that 
the final rule should explicitly grant parties to a contested license 
transfer hearing the right to appeal an adverse decision by the 
Commission. Duke suggested that the informal, legislative-style hearing 
process should be extended to other NRC adjudicatory proceedings.
    Commission response. The proposed Subpart M rule provides for 
parties to submit proposed questions to the Presiding Officer. This 
will allow the parties to suggest what they believe to be appropriate 
questions for the witnesses but will allow the Presiding Officer better 
control of the examination of witnesses. This provision should 
effectively eliminate the need for objections and interruptions during 
witness examination. For these reasons the Commission has retained the 
proposed procedure in the final rule. The Commission rejects the 
commenter's suggestion that the rule should define and limit the issues 
appropriate for review, for reasons already discussed in previous 
responses to similar comments. The Commission also sees no point in 
addressing statutory appeal rights in the final rule. A party's right 
to judicial review of an adverse decision is set out in Section 189b. 
of the Atomic Energy Act in conjunction with Chapter 158 of title 28, 
United States Code, and the Administrative Procedure Act. Extension of 
the proposed procedures for license transfer applications to other 
types of NRC proceedings is beyond the scope of this rulemaking, but, 
as noted in more detail in response to an earlier comment, the 
Commission is taking steps to expand the use of similar procedures in 
other proceedings.
    Comment 14. PECO Nuclear noted its view that the proposed rule is 
``a positive step.'' The commenter suggested several minor changes in 
words and punctuation needed to clarify the text of the rule.
    Commission response. The Commission has incorporated in the final 
rule the commenter's suggested minor changes, which do not affect the 
substance of the rule.
    Comment 15. Wisconsin Electric Power Company supported the 
Commission's proposed rule and suggested certain ``clarifications and 
refinements.''
    Commission response. The commenter's suggestions do not differ in 
substance from suggestions made by other commenters that the Commission 
has responded to above.
    Other Comments.

[[Page 66727]]

    Members of the NRC staff in Office of Nuclear Materials Safety and 
Safeguards submitted a comment asking that it be made clear that the 
proposed Subpart M applies to license transfers under 10 CFR Part 72 
and that applications for transfers under Part 72 be noticed in the 
Federal Register pursuant to Sec. 2.1301(b).
    Commission response. The proposed rules were intended to apply to 
all license transfer applications, including those filed under Part 72. 
To make this clear, the Commission has included explicit references to 
Part 72 in this statement of consideration for the final rule. The 
Commission has also modified Sec. 2.1301(b) to list transfer 
applications under Part 72 as one of the class of applications that 
will be noticed in the Federal Register.

III. Description of Final Rule

    The procedures adopted in this rulemaking cover any direct or 
indirect license transfer for which NRC approval is required pursuant 
to the regulatory provisions under which the license was issued. NRC 
regulations and the Atomic Energy Act require approval of any transfer 
of control of a license. See AEA, Sec. 184, 42 U.S.C. 2234. This 
includes those transfers that require license amendments and those that 
do not. It should be recognized that not all license transfers will 
require license amendments. For example, the total acquisition of a 
licensee, without a change in the name of the licensee, (e.g., through 
the creation of a holding company which acquires the existing licensee 
but which, beyond ownership of the licensee, does not otherwise affect 
activities for which a license is required), would require NRC 
approval, but would not necessarily require any changes in the NRC 
license for the facilities owned by the licensee.
    These procedures do not expand or change the circumstances under 
which NRC approval of a transfer is necessary nor do they change the 
circumstances under which a license amendment would be required to 
reflect an approved transfer. Amendments to licenses are required only 
to the extent that ownership or operating authority of a licensee, as 
reflected in the license itself, is changed by a transfer. A discussion 
of the process for issuing amendments associated with an approved 
transfer, when necessary, is provided below.
    The procedures, similar to those used by the Commission in cases 
involving export licensing hearings under 10 CFR Part 110, provide for 
an informal type hearing for license transfers. These procedures 
provide opportunities for meaningful public participation while 
minimizing areas where a formal adjudicatory process could introduce 
delays without any commensurate benefit to the substance of the 
Commission's decisionmaking.
    The Commission will either elect to develop an evidentiary record 
and render a final decision itself, or will appoint a Presiding Officer 
who will be responsible for collecting evidence and developing a record 
for submission to the Commission. For such proceedings, the Commission 
may appoint a Presiding Officer from the Atomic Safety and Licensing 
Board Panel (ASLBP), although the proposed regulations do not restrict 
the sources from which the Commission may select.
    It should be noted that the regulations do not require the NRC 
staff to participate in the proceedings as a formal party unless the 
Commission directs the use of Subpart G procedures or otherwise directs 
the staff to participate as a party. The Commission expects, 
nevertheless, that, in most cases, the NRC staff will participate to 
the extent that it will offer into evidence staff's Safety Evaluation 
Report that supports its conclusions on whether to initially grant or 
deny the requested license transfer and provide one or more appropriate 
sponsoring witnesses. Greater NRC staff involvement may be directed by 
the Commission on its own initiative or at the staff's choosing, as 
circumstances warrant.
    One aspect of the rule designed to improve efficiency is the 
decision to require oral hearings on all transfers where a hearing is 
to be held under Subpart M, with very limited exceptions. It has been 
the Commission's experience in Subpart L proceedings that intervenors 
are particularly interested in having the opportunity to make oral 
presentations or arguments for inclusion in the record. Even though 
such requests are rarely granted,1 intervenors can and do 
introduce the issue of whether to have oral presentations in individual 
proceedings. Rather than have the issue of oral presentations become a 
point of contention in individual proceedings (which could introduce 
unnecessary delays in completing the record) the rule resolves this 
concern by ensuring that all parties have the opportunity to present 
oral testimony. The question of whether cross examination of witnesses 
should be allowed has also led to arguments in Subpart L 
proceedings.2 The Commission has addressed this area of 
potential dispute by providing in Subpart M for questioning of 
witnesses only by the Presiding Officer. Although only the Presiding 
Officer may question witnesses, the rule specifically provides parties 
the opportunity to present recommended questions to the Presiding 
Officer.
---------------------------------------------------------------------------

    \1\ Curators of the University of Missouri, CLI-95-1, 41 NRC 71 
120 (1995).
    \2\ Id.
---------------------------------------------------------------------------

    Another aspect of the rule intended to improve the efficiency of 
the adjudicatory process is that, while it does not provide for any 
separate discovery, it does require that a Hearing Docket containing 
all relevant documents and correspondence be established and be made 
available at the Commission's Public Document Room. This approach is in 
keeping with establishment of a case file as described in the 
Commission's recent Statement of Policy on Conduct of Adjudicatory 
Proceedings, CLI-98-12 (63 FR 41872; August 5, 1998).
    Finally, to improve the efficiency of the adjudicatory process the 
rule imposes schedular milestones for the filing of testimony and 
responses and for the commencement of oral hearings. Subject to the 
Presiding Officer's scheduling adjustments in particular proceedings, 
the procedures require initial testimony, statements of position on the 
issues, and responsive testimony to be filed within 50 days of the 
Commission's decision to grant a request for a hearing. The hearing 
will commence in just over two months from the Commission's decision to 
hold a hearing. Assuming that the NRC staff is able to complete its 
technical review and take initial action on the transfer application 
within three to four months of its notice of receipt of the 
application, these procedures are expected to result in the issuance of 
a final Commission decision on the license transfer within about six to 
eight months of the notice of receipt of the application in routine 
cases. Complex cases requiring more extensive review or the use of 
different hearing procedures may take more time.

Administrative License Amendments Associated With License Transfers

    As discussed above, not all license transfers require license 
amendments. Only when the license specifically has references to 
entities or persons that no longer are accurate following the approved 
transfer will a situation exist that requires amendments to the 
license. Such amendments are essentially administrative in nature. That 
is, in determining whether to approve such amendments, the only issue 
is whether the license amendment accurately reflects the approved 
transfer. Substantive issues regarding requests for a hearing on the 
appropriateness of the

[[Page 66728]]

transfer itself may only be considered using the procedures in this 
rule. The Commission has previously noted that issuance of such an 
administrative amendment, following the review and approval of the 
transfer itself, ``presents no safety questions and clearly involves no 
significant hazards considerations.'' Long Island Lighting Company, 
supra, 35 NRC at 77, n.6.
    Safety Evaluation Reports (SERs) prepared in connection with 
previous license transfers confirm that such transfers do not, as a 
general matter, have significant impacts on the public health and 
safety. Accordingly, the new regulations provide that conforming 
amendments to the license may be issued by the NRC staff at any time 
after the staff has reviewed and approved the proposed transfer, 
notwithstanding the pendency of any hearing under the proposed Subpart 
M. As is done currently, NRC staff approval of a transfer application 
will take the form of an order. Such order will also identify any 
license amendment issued.
    The Commission, through this rulemaking, is making a generic 
finding that, for purposes of 10 CFR 50.58(b)(5), 50.91 and 50.92, and 
72.46 and 72.50, administrative amendments which do no more than 
reflect an approved transfer and do not directly affect actual 
operating methods and actual operation of the facility do not involve a 
``significant hazards consideration'' or a ``genuine issue 
consideration,'' respectively, and do not require that a hearing 
opportunity be provided prior to issuance. It must be emphasized that 
any post-effectiveness hearing on such administrative amendments will 
be limited to the question of whether the amendment accurately reflects 
the approved transfer. The Commission does note, however, that it 
retains the authority, as a matter of discretion, to direct completion 
of hearings prior to issuance of the transfer approval and any required 
amendments in individual cases and to direct the use of other hearing 
procedures, if the Commission believes it is in the interest of public 
health and safety to do so.

Environmental Issues

    The NRC staff has completed many Environmental Assessments related 
to license transfers. These assessments have uniformly demonstrated 
that there are no significant environmental effects from license 
transfers. Indeed, as the Commission has noted previously, amendments 
effectuating an approved transfer present no safety questions and 
involve no significant hazards considerations.3 Accordingly, 
the Commission has determined that a new categorical exclusion should 
be added to 10 CFR Part 51 which will obviate the need for the NRC 
staff to continue to conduct individual Environmental Assessments in 
each transfer case.
---------------------------------------------------------------------------

    \3\ Long Island Lighting Company, supra, 35 NRC at 77, n. 6.
---------------------------------------------------------------------------

Limitation to License Transfers

    The Commission wishes to emphasize that the proposed rules address 
only license transfers and associated administrative amendments to 
reflect transfers. Requests for license amendments that involve changes 
in actual operations or requirements directly involving health and 
safety-related activities will continue to be subject to the amendment 
processes currently in use in Parts 50 and 72, including the 
requirement for individualized findings under 10 CFR 50.58, 50.91 and 
50.92 that address the necessity for pre-effectiveness hearings.

Basis for Immediate Effectiveness

    The Commission has determined that this rule should become 
immediately effective upon publication. The Administrative Procedure 
Act relieves the agency of the requirement that publication of a 
substantive rule be made not less than thirty days before its effective 
date in the case of ``a substantive rule which...relieves a 
restriction'' or ``as otherwise provided by the agency for good cause 
found and published with the rule.'' 5 U.S.C. 553(d)(1) and 553(d)(3). 
The purpose of the thirty-day waiting period ``is to give affected 
parties a reasonable time to adjust their behavior before the final 
rule takes effect.'' Omnipoint Corp. v. F.C.C., 78 F. 3d 620 (D.C. Cir. 
1996). The rule deals primarily with procedures that will be used in 
future hearings on applications for license transfers. The rule adds no 
burden to the conduct of activities regulated by the NRC. Thus there is 
no need for NRC licensees or anyone else ``to adjust their behavior'' 
to achieve compliance with the rule. Moreover, comments by persons most 
likely to be affected by the rule (potential applicants) appear to 
favor the rule and its prompt implementation. The Commission therefore 
finds there is good cause to make this rule immediately effective. 
Alternatively, the Commission notes that the rule in effect ``relieves 
a restriction'' in that the hearing process established by Subpart M 
should be less burdensome for parties to license transfer proceedings 
than the procedures which the Commission has previously by practice 
applied. Thus the Commission's decision to dispense with the thirty day 
waiting period is also supported by 5 U.S.C. 553(d)(1) .

Finding of No Significant Environmental Impact and Categorical 
Exclusion

    The Commission has determined under the National Environmental 
Policy Act (NEPA) of 1969, as amended, and the Commission's regulations 
in Subpart A of 10 CFR Part 51, that this rule falls within the 
categorical exclusion appearing at 10 CFR 51.22 (c)(1) for which 
neither an Environmental Assessment nor an Environmental Impact 
Statement is required.
    Further, under its procedures for implementing NEPA, the Commission 
may exclude from preparation of an environmental impact statement, or 
an environmental assessment, a category of actions which do not 
individually or cumulatively have a significant effect on the human 
environment and which have been found to have no such effect in NRC 
proceedings. In this rulemaking, the Commission finds that the approval 
of a direct or indirect license transfer, as well as any required 
administrative license amendments to reflect the approved transfer, 
comprises a category of actions which do not individually or 
cumulatively have a significant effect on the human environment. 
Actions in this category are similar in that, under the AEA and 
Commission regulations, transfers of licenses (and associated 
administrative amendments to licenses) will not in and of themselves 
permit the licensee to operate the facility in any manner different 
from that which has previously been permitted under the existing 
license. Thus, the transfer will usually not raise issues of 
environmental impact that differ from those considered in initial 
licensing of a facility. In addition, the denial of a transfer would 
also have in and of itself no impact on the environment, since the 
licensee would still be authorized to operate the facility in 
accordance with the existing license.
    Environment assessments that have been conducted regarding numerous 
license transfers under existing regulations have not demonstrated the 
existence of a major federal action significantly affecting the 
environment. Further, the final rule does not apply to any request for 
an amendment that would directly affect the actual operation of a 
facility. Amendments that directly affect the actual operation of a 
facility would be subject to consideration pursuant to the existing 
license amendment processes, including the requirements in 10 CFR Part 
2,

[[Page 66729]]

Subpart G or L as appropriate and applicable environmental review 
requirements of 10 CFR Part 51.

Paperwork Reduction Act Statement

    The final rule does not contain a new or amended information 
collection requirement subject to the Paperwork Reduction Act of 1995 
(44 U.S.C. 3501, et. seq.). Existing requirements for 10 CFR Part 51 
were approved by the Office of Management and Budget, approval number 
3150-0021.

Public Protection Notification

    If an information collection does not display a currently valid OMB 
control number, the NRC may not conduct or sponsor, and a person is not 
required to respond to, the information collection.

Regulatory Analysis

    To determine whether the amendments to 10 CFR Part 2 contained in 
this final rule were appropriate, the Commission considered the 
following options:
1. The No-Action Alternative
    This alternative was not deemed acceptable for the following 
reasons. First, this option would leave reactor transfers subject to 
past practice which generally involved hearings using multi-member, 
multi-disciplined licensing boards, even though such transfers do not 
involve the type of complex technical questions for which multi-member 
boards of diverse background may provide a useful technical pool of 
experience.
    Second, the formal adjudicatory hearing process would needlessly 
add formality and resource burdens to the development of a record for 
reaching a decision on applications for transfer approval without any 
commensurate benefit to the public health and safety or the common 
defense and security.
    Third, the current process for materials licensees under 10 CFR 
Part 2, Subpart L, while not utilizing the multi-member licensing 
boards, does not necessarily result in uniform treatment of all license 
transfer requests, and provides at least the potential for more formal 
hearings. Even if the requests for more formal procedures are not 
granted in typical materials cases, the process of receiving motions 
for more formal procedures, allowing responses from all parties to 
those requests, and the need for parties' responses to those requests, 
and the need for the Presiding Officer to consider and rule on such 
requests introduces issues and litigation on matters not involving the 
merits of the particular application and thus introduces the potential 
for delays in materials license transfer proceedings, without clear 
benefit to the public health and safety or the common defense and 
security.
2. Use 10 CFR Part 2, Subpart G for All License Transfers
    While assuring uniformity for all license transfer requests, this 
option would not result in an expeditious process that would avoid the 
use of multi-member licensing boards, which is unnecessary given the 
nature of typical transfer applications. It would also result in added 
formality and resources being devoted to materials license transfers on 
the part of all parties to the hearing, without any resulting benefit 
to public health and safety.
3. Use of 10 CFR Part 2, Subpart L for All License Transfers
    This option was considered as viable to achieve uniformity and to 
avoid the need for multi-member licensing boards for conducting 
requested hearings. Subpart L provides for paper hearings unless oral 
presentations are ordered by the Presiding Officer. Further, Subpart L 
allows the Presiding Officer the option of recommending to the 
Commission that more formal procedures be used. Even though such 
requests are rarely granted, as a practical matter there are delays in 
the proceeding while parties petition the Presiding Officer and/or the 
Commission to have oral hearings and to use additional procedures, such 
as cross-examination and formal discovery. Such discretion in 
structuring individual hearings is appropriate where the breadth of 
potential actions and licensees (covering essentially all amendments 
for a wide variety of materials licensees) is governed by a single 
hearing process. This flexibility, however, inevitably leads to delays 
as each party to the hearings proposes and presents arguments to the 
Presiding Officer concerning how the hearing should be structured.
4. Use of a New Subpart M for all License Transfers
    In the case of license transfer applications the Commission is 
concerned with only one type of approval, so the Commission has the 
ability to resolve through rulemaking many of these procedural points 
concerning the conduct of the hearing. The resolution of these issues 
will allow the parties in license transfer proceedings to move 
expeditiously to examination of the substantive issues in the 
proceeding. The Subpart M process, similar to a legislative-type 
hearing, will also result in the record promptly reaching the 
Commission, where a final agency determination can be made. The rule 
dictates that oral hearings be held on each application for which a 
hearing request is granted unless the parties unanimously agree to 
forgo the oral hearing. This will remove the potential for a delay 
while parties petition the Presiding Officer for an oral hearing. 
Further, the rule provides that the Presiding Officer will conduct all 
questioning of witnesses, and there are no provisions for formal 
discovery, although docket files with relevant materials will be 
publicly available. The rule resolves several areas of frequent dispute 
in subpart L proceedings and was seen, therefore, as being more 
appropriate for license transfer proceedings where a timely decision is 
important to the public interest. These efficiencies can be achieved 
without any negative effect on substantive decisonmaking or the rights 
of all parties to present relevant witnesses, written testimony, and 
oral arguments, which should result in a high quality record on 
substantive issues for use by the Commission in reaching a decision on 
contested issues.
5. Conclusion.
    Based on the foregoing considerations, the Commission has decided 
to adopt Subpart M and the attendant conforming amendments to provide 
the procedures for actions on license transfer applications. This 
constitutes the NRC's regulatory analysis.

Regulatory Flexibility Certification

    In accordance with the Regulatory Flexibility Act of 1980, 5 U.S.C. 
605(b), the Commission hereby certifies that this rule will not have a 
significant economic impact on a substantial number of small entities. 
This rule does not change any requirements for submittal of license 
transfer requests to NRC, rather, the procedures designate how NRC will 
handle requests for hearings on applications for license transfers. 
Most requested hearings on license transfer applications involve 
reactor licensees which are large organizations which do not fall 
within the definition of a small business found in section 3 of the 
Small Business Action, 15 U.S.C. 632, or within the Small Business 
Standards set forth in 13 CFR Part 121 or in the size standards adopted 
by the NRC (10 CFR 2.810). Based on the historically low number of 
requests for hearings involving materials licensees, it is not expected 
that this rule will have any significant economic impact on a 
substantial number of small businesses.

[[Page 66730]]

Backfit Analysis

    The NRC has determined that the backfit rule, 10 CFR 50.109 and 
72.62, does not apply to this proposed rule and a backfit analysis is 
not required, because these amendments do not involve any provisions 
that would impose backfits as defined in either 10 CFR 50.109 or 72.62. 
The rule does not constitute a backfit under either of these sections 
because it does not propose a change to or additions to requirements 
for existing structures, systems, components, procedures, organizations 
or designs associated with the construction or operation of a facility 
under Part 50 or 72.

Small Business Regulatory Enforcement Fairness Act

    In accordance with the Regulatory Enforcement Fairness Act of 1996, 
the NRC has determined that this action is not a major rule and has 
verified this determination with the Office of Information and 
Regulatory Affairs of OMB.

List of Subjects

10 CFR Part 2

    Administrative practice and procedure, Antitrust, Byproduct 
material, Classified information, Environmental protection, Nuclear 
materials, Nuclear power plants and reactors, Penalties, Sex 
discrimination, Source material, Special nuclear material, Waste 
treatment and disposal.

10 CFR Part 51

    Administrative practice and procedure, Environmental impact 
statement, Nuclear materials, Nuclear power plants and reactors, 
Reporting and record keeping requirements.

    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 Nuclear 
Regulatory Commission is adopting the following amendments to 10 CFR 
Parts 2 and 51:

PART 2--RULES OF PRACTICE FOR DOMESTIC LICENSING PROCEEDINGS

    1. The authority citation for Part 2 is revised to read as follows:

    Authority: Secs. 161, 181, 68 Stat. 948, 953, as amended (42 
U.S.C. 2201, 2231); sec. 191, as amended, Pub. L. 87-615, 76 Stat. 
409 (42 U.S.C. 2241); sec. 201, 88 Stat. 1242, as amended (42 U.S.C. 
5841); 5 U.S.C. 552.
    Section 2.101 also issued under secs. 53, 62, 63, 81, 103, 104, 
105, 68 Stat. 930, 932, 933, 935, 936, 937, 938, as amended (42 
U.S.C. 2073, 2092, 2093, 2111, 2133, 2134, 2135); sec. 114(f); Pub. 
L. 97-425, 96 Stat. 2213, as amended (42 U.S.C. 10143(f)); sec. 102, 
Pub. L. 91-190, 83 Stat. 853, as amended (42 U.S.C. 4332); sec. 301, 
88 Stat. 1248 (42 U.S.C. 5871). Section 2.102, 2.103, 2.104, 2.105, 
2.721 also issued under secs. 102, 103, 104, 105, 183i, 189, 68 
Stat. 936, 937, 938, 954, 955, as amended (42 U.S.C. 2132, 2133, 
2134, 2135, 2233, 2239). Section 2.105 also issued under Pub. L. 97-
415, 96 Stat. 2073 (42 U.S.C. 2239). Sections 2.200-2.206 also 
issued under secs. 161 b, i, o, 182, 186, 234, 68 Stat. 948-951, 
955, 83 Stat. 444, as amended (42 U.S.C. 2201 (b), (i), (o), 2236, 
2282); sec. 206, 88 Stat 1246 (42 U.S.C. 5846). Sections 2.205(j) 
also issued under Pub. L. 101-410, 104 Stat. 90, as amended by 
section 3100(s), Pub. L. 104-134, 110 Stat. 1321-373 (28 U.S.C. 2461 
note). Section 2.600-2.606 also issued under sec. 102, Pub. L. 91-
190, 83 Stat. 853, as amended (42 U.S.C. 4332). Section 2.700a, 
2.719 also issued under 5 U.S.C. 554. Sections 2.754, 2.760, 2.770, 
2.780 also issued under 5 U.S.C. 557. Section 2.764 also issued 
under secs. 135, 141, Pub. L. 97-425, 96 Stat. 2232, 2241 (42 U.S.C. 
10155, 10161). Section 2.790 also issued under sec. 103, 68 Stat. 
936, as amended (42 U.S.C. 2133) and 5 U.S.C. 552. Sections 2.800 
and 2.808 also issued under 5 U.S.C. 553, Section 2.809 also issued 
under 5 U.S.C. 553, and sec. 29, Pub. L. 85-256, 71 Stat. 579, as 
amended (42 U.S.C. 2039). Subpart K also issued under sec. 189, 68 
Stat. 955 (42 U.S.C. 2239); sec. 134, Pub. L. 97-425, 96 Stat. 2230 
(42 U.S.C. 10154). Subpart L also issued under sec. 189, 68 Stat. 
955 (42 U.S.C. 2239). Subpart M also issued under sec. 184 (42 
U.S.C. 2234) and sec. 189, 68 Stat. 955 (42 U.S.C. 2239). Appendix A 
also issued under sec. 6, Pub. L. 91-560, 84 Stat. 1473 (42 U.S.C. 
2135).

    2. In Sec. 2.101, paragraph (a)(1) is revised to read as follows:


Sec. 2.101  Filing of application.

    (a)(1) An application for a license, a license transfer, or an 
amendment to a license shall be filed with the Director of the Office 
of Nuclear Reactor Regulation or Director of the Office of Nuclear 
Material Safety and Safeguards, as prescribed by the applicable 
provisions of this chapter. A prospective applicant may confer 
informally with the NRC staff prior to the filing of an application.
* * * * *
    3. In Sec. 2.1103, after the final sentence the following sentence 
is added to read as follows:


Sec. 2.1103  Scope.

    * * * This subpart shall not apply to proceedings on applications 
for transfer of a license issued under Part 72 of this chapter. Subpart 
M of this part applies to license transfer proceedings.
    4. In Sec. 2.1201, paragraph (a)(1) is revised to read as follows:


Sec. 2.1201  Scope of subpart.

    (a) * * *
    (1) The grant, renewal or licensee-initiated amendment of a 
materials license subject to parts 30, 32 through 35, 39, 40, or 70 of 
this chapter, with the exception of a license amendment related to an 
application to transfer a license; or
* * * * *
    5. In Sec. 2.1205, paragraphs (a) and (b) are revised to read as 
follows:


Sec. 2.1205  Request for a hearing: petition for leave to intervene.

    (a) Any person whose interest may be affected by a proceeding for 
the grant, renewal, or licensee-initiated amendment of a license 
subject to this subpart may file a request for a hearing.
    (b) An applicant for a license, a license amendment, or a license 
renewal who is issued a notice of proposed denial or a notice of denial 
and who desires a hearing shall file the request for the hearing within 
the time specified in Sec. 2.103 in all cases. An applicant may include 
in the request for hearing a request that the presiding officer 
recommend to the Commission that procedures other than those authorized 
under this subpart be used in the proceeding, provided that the 
applicant identifies the special factual circumstances or issues which 
support the use of other procedures.
* * * * *
    6. In Part 2, a new Subpart M is added to read as follows:

Subpart M--Public Notification, Availability of Documents and Records, 
Hearing Requests and Procedures for Hearings on License Transfer 
Applications.

Sec.
2.1300  Scope of subpart M.
2.1301  Public notice of receipt of a license transfer application.
2.1302  Notice of withdrawal of an application.
2.1303  Availability of documents in the Public Document Room.
2.1304  Hearing procedures.
2.1305  Written comments.
2.1306  Hearing request or intervention petition.
2.1307  Answers and replies.
2.1308  Commission action on a hearing request or intervention 
petition.
2.1309  Notice of oral hearing.
2.1310  Notice of hearing consisting of written comments.
2.1311  Conditions in a notice or order.
2.1312  Authority of the Secretary.
2.1313  Filing and service.
2.1314  Computation of time.
2.1315  Generic determination regarding license amendments to 
reflect transfers.
2.1316  Authority and role of NRC staff.
2.1317  Hearing docket.
2.1318  Acceptance of hearing documents.
2.1319  Presiding Officer.
2.1320  Responsibility and power of the Presiding Officer in an oral 
hearing.

[[Page 66731]]

2.1321  Participation and schedule for submissions in a hearing 
consisting of written comments.
2.1322  Participation and schedule for submissions in an oral 
hearing.
2.1323  Presentation of testimony in an oral hearing.
2.1324  Appearance in an oral hearing.
2.1325  Motions and requests.
2.1326  Burden of proof.
2.1327  Application for a stay of the effectiveness of NRC staff 
action on license transfer.
2.1328  Default.
2.1329  Waiver of a rule or regulation.
2.1330  Reporter and transcript for an oral hearing.
2.1331  Commission action.

Subpart M--Public Notification, Availability of Documents and 
Records, Hearing Requests and Procedures for Hearings on License 
Transfer Applications.


Sec. 2.1300  Scope of subpart M.

    This subpart governs requests for, and procedures for conducting, 
hearings on any application for the direct or indirect transfer of 
control of an NRC license which transfer requires prior approval of the 
NRC under the Commission's regulations, governing statutes, or pursuant 
to a license condition. This subpart is to provide the only mechanism 
for requesting hearings on license transfer requests, unless contrary 
case specific orders are issued by the Commission.


Sec. 2.1301  Public notice of receipt of a license transfer 
application.

    (a) The Commission will notice the receipt of each application for 
direct or indirect transfer of a specific NRC license by placing a copy 
of the application in the NRC Public Document Room.
    (b) The Commission will also publish in the Federal Register a 
notice of receipt of an application for approval of a license transfer 
involving 10 CFR part 50 and part 52 licenses, major fuel cycle 
facility licenses issued under part 70, or part 72 licenses. This 
notice constitutes the notice required by Sec. 2.105 with respect to 
all matters related to the application requiring NRC approval.
    (c) Periodic lists of applications received may be obtained upon 
request addressed to the Public Document Room, U.S. Nuclear Regulatory 
Commission, Washington, DC 20555-0001.


Sec. 2.1302  Notice of withdrawal of an application.

    The Commission will notice the withdrawal of an application by 
publishing the notice of withdrawal in the same manner as the notice of 
receipt of the application was published under Sec. 2.1301.


Sec. 2.1303  Availability of documents in the Public Document Room.

    Unless exempt from disclosure under part 9 of this chapter, the 
following documents pertaining to each application for a license 
transfer requiring Commission approval will be placed in the Public 
Document Room when available:
    (a) The license transfer application and any associated requests;
    (b) Commission correspondence with the applicant or licensee 
related to the application;
    (c) Federal Register notices;
    (d) The NRC staff Safety Evaluation Report (SER).
    (e) Any NRC staff order which acts on the license transfer 
application; and
    (f) If a hearing is held, the hearing record and decision.


Sec. 2.1304  Hearing procedures.

    The procedures in this subpart will constitute the exclusive basis 
for hearings on license transfer applications for all NRC specific 
licenses.


Sec. 2.1305  Written comments.

    (a) As an alternative to requests for hearings and petitions to 
intervene, persons may submit written comments regarding license 
transfer applications. The Commission will consider and, if 
appropriate, respond to these comments, but these comments do not 
otherwise constitute part of the decisional record.
    (b) These comments should be submitted within 30 days after public 
notice of receipt of the application and addressed to the Secretary, 
U.S. Nuclear Regulatory Commission, Washington, DC 20555-0001, 
Attention: Rulemakings and Adjudications Staff.
    (c) The Commission will provide the applicant with a copy of the 
comments. Any response the applicant chooses to make to the comments 
must be submitted within 10 days of service of the comments on the 
applicant. Such responses do not constitute part of the decisional 
record.


Sec. 2.1306  Hearing request or intervention petition.

    (a) Any person whose interest may be affected by the Commission's 
action on the application may request a hearing or petition for leave 
to intervene on a license application for approval of a direct or 
indirect transfer of a specific license.
    (b) Hearing requests and intervention petitions must--
    (1) State the name, address, and telephone number of the requestor 
or petitioner;
    (2) Set forth the issues sought to be raised and
    (i) Demonstrate that such issues are within the scope of the 
proceeding on the license transfer application,
    (ii) Demonstrate that such issues are relevant to the findings the 
NRC must make to grant the application for license transfer,
    (iii) Provide a concise statement of the alleged facts or expert 
opinions which support the petitioner's position on the issues and on 
which the petitioner intends to rely at hearing, together with 
references to the specific sources and documents on which the 
petitioner intends to rely to support its position on the issues, and
    (iv) Provide sufficient information to show that a genuine dispute 
exists with the applicant on a material issue of law or fact;
    (3) Specify both the facts pertaining to the petitioner's interest 
and how the interest may be affected, with particular reference to the 
factors in Sec. 2.1308(a);
    (4) Be served on both the applicant and the NRC Office of the 
Secretary by any of the methods for service specified in Sec. 2.1313.
    (c) Hearing requests and intervention petitions will be considered 
timely only if filed not later than:
    (1) 20 days after notice of receipt is published in the Federal 
Register, for those applications published in the Federal Register;
    (2) 45 days after notice of receipt is placed in the Public 
Document Room for all other applications; or
    (3) Such other time as may be provided by the Commission.


Sec. 2.1307  Answers and replies.

    (a) Unless otherwise specified by the Commission, an answer to a 
hearing request or intervention petition may be filed within 10 days 
after the request or petition has been served.
    (b) Unless otherwise specified by the Commission, a reply to an 
answer may be filed within 5 days after service of that answer.
    (c) Answers and replies should address the factors in Sec. 2.1308.


Sec. 2.1308  Commission action on a hearing request or intervention 
petition.

    (a) In considering a hearing request or intervention petition on an 
application for a transfer of an NRC license, the Commission will 
consider:
    (1) The nature of the Petitioner's alleged interest;
    (2) Whether that interest will be affected by an approval or denial 
of the application for transfer;

[[Page 66732]]

    (3) The possible effect of an order granting the request for 
license transfer on that interest, including whether the relief 
requested is within the Commission's authority, and, if so, whether 
granting the relief requested would redress the alleged injury; and
    (4) Whether the issues sought to be litigated are--
    (i) Within the scope of the proceeding;
    (ii) Relevant to the findings the Commission must make to act on 
the application for license transfer;
    (iii) Appropriate for litigation in the proceeding; and
    (iv) Adequately supported by the statements, allegations, and 
documentation required by Sec. 2.1306(b)(2) (iii) and (iv).
    (b) Untimely hearing requests or intervention petitions may be 
denied unless good cause for failure to file on time is established. In 
reviewing untimely requests or petitions, the Commission will also 
consider:
    (1) The availability of other means by which the requestor's or 
petitioner's interest will be protected or represented by other 
participants in a hearing; and
    (2) The extent to which the issues will be broadened or final 
action on the application delayed.
    (c) The Commission will deny a request or petition to the extent it 
pertains solely to matters outside its jurisdiction.
    (d)(1) After consideration of the factors covered by paragraphs (a) 
through (c) of this section, the Commission will issue a notice or 
order granting or denying a hearing request or intervention petition, 
designating the issues for any hearing that will be held and 
designating the Presiding Officer. A notice granting a hearing will be 
published in the Federal Register and served on the parties to the 
hearing.
    (2) Hearings under this subpart will be oral hearings, unless, 
within 15 days of the service of the notice or order granting a 
hearing, the parties unanimously agree and file a joint motion 
requesting a hearing consisting of written comments. No motion to hold 
a hearing consisting of written comments will be entertained absent 
unanimous consent of all parties.
    (3) A denial of a request for hearing and a denial of any petition 
to intervene will set forth the reasons for the denial.


Sec. 2.1309  Notice of oral hearing.

    (a) A notice of oral hearing will--
    (1) State the time, place, and issues to be considered;
    (2) Provide names and addresses of participants,
    (3) Specify the time limit for participants and others to indicate 
whether they wish to present views;
    (4) Specify the schedule for the filing of written testimony, 
statements of position, proposed questions for the Presiding Officer to 
consider, and rebuttal testimony consistent with the schedule 
provisions of Sec. 2.1321.
    (5) Specify that the oral hearing shall commence within 15 days of 
the date for submittal of rebuttal testimony unless otherwise ordered;
    (6) State any other instructions the Commission deems appropriate;
    (7) If so determined by the NRC staff or otherwise directed by the 
Commission, direct that the staff participate as a party with respect 
to some or all issues.
    (b) If the Commission is not the Presiding Officer, the notice of 
oral hearing will also state:
    (1) When the jurisdiction of the Presiding Officer commences and 
terminates;
    (2) The powers of the Presiding Officer;
    (3) Instructions to the Presiding Officer to certify promptly the 
completed hearing record to the Commission without a recommended or 
preliminary decision.


Sec. 2.1310  Notice of hearing consisting of written comments.

    A notice of hearing consisting of written comments will:
    (a) State the issues to be considered;
    (b) Provide the names and addresses of participants;
    (c) Specify the schedule for the filing of written testimony, 
statements of position, proposed questions for the Presiding Officer to 
consider for submission to the other parties, and rebuttal testimony, 
consistent with the schedule provisions of Sec. 2.1321.
    (d) State any other instructions the Commission deems appropriate.


Sec. 2.1311  Conditions in a notice or order.

    (a) A notice or order granting a hearing or permitting intervention 
shall--
    (1) Restrict irrelevant or duplicative testimony; and
    (2) Require common interests to be represented by a single 
participant.
    (b) If a participant's interests do not extend to all the issues in 
the hearing, the notice or order may limit her/his participation 
accordingly.


Sec. 2.1312  Authority of the Secretary.

    The Secretary or the Assistant Secretary may rule on procedural 
matters relating to proceedings conducted by the Commission itself 
under this subpart to the same extent they can do so under Sec. 2.772 
for proceedings under subpart G.


Sec. 2.1313  Filing and service.

    (a) Hearing requests, intervention petitions, answers, replies and 
accompanying documents must be served as described in paragraph (b) of 
this section by delivery, facsimile transmission, e-mail or other means 
that will ensure receipt by close of business on the due date for 
filing. Any participant filing hearing requests, intervention 
petitions, replies and accompanying documents should include 
information on mail and delivery addresses, e-mail addresses, and 
facsimile numbers in their initial filings which may be used by the 
Commission, Presiding Officer and other parties for serving documents 
on the participant.
    (b) All filings must be served upon the applicant; the General 
Counsel, U.S. Nuclear Regulatory Commission, Washington, DC 20555-0001; 
the Secretary of the Commission, U.S. Nuclear Regulatory Commission, 
Washington, DC 20555-0001; and participants if any. If service to the 
Secretary is by delivery or by mail the filings should be addressed to 
the Secretary, U.S. Nuclear Regulatory Commission, Washington, DC 
20555-0001, Attention: Rulemakings and Adjudications Staff. E-mail 
filings may be sent to the Secretary at the following e-mail address: 
[email protected]. Facsimile transmission filings may be filed with the 
Secretary using the following number: 301-415-1101.
    (c) Service is completed by:
    (1) Delivering the paper to the person; or leaving it in her or his 
office with someone in charge; or, if there is no one in charge, 
leaving it in a conspicuous place in the office; or, if the recipient 
has no office or it is closed, leaving it at her or his usual place of 
residence with some occupant of suitable age and discretion;
    (2) Depositing it in the United States mail, properly stamped and 
addressed; or
    (3) Any other manner authorized by law, when service cannot be made 
as provided in paragraphs (c)(1) or (2) of this section.
    (4) For facsimile transmission, sending copies to the facsimile 
machine of the person being served;
    (5) For e-mail, sending the filing in electronic form attached to 
an e-mail message directed to the person being served.
    (d) Proof of service, stating the name and address of the person 
served and the manner and date of service, shall be shown, and may be 
made by--
    (1) Written acknowledgment of the person served or an authorized 
representative; or

[[Page 66733]]

    (2) The certificate or affidavit of the person making the service.
    (e) The Commission may make special provisions for service when 
circumstances warrant.


Sec. 2.1314  Computation of time.

    (a) In computing time, the first day of a designated time period is 
not included and the last day is included. If the last day is a 
Saturday, Sunday or legal holiday at the place where the required 
action is to be accomplished, the time period will end on the next day 
which is not a Saturday, Sunday or legal holiday.
    (b) In time periods of 7 days or less, Saturdays, Sundays and 
holidays are not counted.
    (c) Whenever an action is required within a prescribed period 
following service of a paper, 3 days shall be added to the prescribed 
period if service is by regular mail.


Sec. 2.1315  Generic determination regarding license amendments to 
reflect transfers.

    (a) Unless otherwise determined by the Commission with regard to a 
specific application, the Commission has determined that any amendment 
to the license of a utilization facility or the license of an 
Independent Spent Fuel Storage Installation which does no more than 
conform the license to reflect the transfer action, involves 
respectively, ``no significant hazards consideration'' or ``no generic 
issue as to whether the health and safety of the public will be 
significantly affected.''
    (b) Where administrative license amendments are necessary to 
reflect an approved transfer, such amendments will be included in the 
order that approves the transfer. Any challenge to the administrative 
license amendment is limited to the question of whether the license 
amendment accurately reflects the approved transfer.


Sec. 2.1316  Authority and role of NRC staff.

    (a) During the pendency of any hearing under this subpart, 
consistent with the NRC staff's findings in its Safety Evaluation 
Report (SER), the staff is expected to promptly issue approval or 
denial of license transfer requests. Notice of such action shall be 
promptly transmitted to the Presiding Officer and parties to the 
proceeding.
    (b) Except as otherwise directed in accordance with 
Sec. 2.1309(a)(7), the NRC staff is not required to be a party to 
proceedings under this subpart but will offer into evidence its SER 
associated with the transfer application and provide one or more 
sponsoring witnesses.
    (c) If the NRC staff desires to participate as a party, the staff 
shall notify the Presiding Officer and the parties and shall thereupon 
be deemed to be a party with all the rights and responsibilities of a 
party.


Sec. 2.1317  Hearing docket.

    For each hearing, the Secretary will maintain a docket which will 
include the hearing transcript, exhibits and all papers filed or issued 
in connection with the hearing. This file will be made available to all 
parties in accordance with the provisions of Sec. 2.1303 and will 
constitute the only discovery in proceedings under this subpart.


Sec. 2.1318  Acceptance of hearing documents.

    (a) Each document filed or issued must be clearly legible and bear 
the docket number, license application number, and hearing title.
    (b) Each document shall be filed in one original and signed by the 
participant or its authorized representative, with the address and date 
of signature indicated. The signature is a representation that the 
document is submitted with full authority, the person signing knows its 
contents and that, to the best of their knowledge, the statements made 
in it are true.
    (c) A document not meeting the requirements of this section may be 
returned with an explanation for nonacceptance and, if so, will not be 
docketed.


Sec. 2.1319  Presiding Officer.

    (a) The Commission will ordinarily be the Presiding Officer at a 
hearing under this part. However, the Commission may provide in a 
hearing notice that one or more Commissioners, or any other person 
permitted by law, will preside.
    (b) A participant may submit a written motion for the 
disqualification of any person presiding. The motion shall be supported 
by an affidavit setting forth the alleged grounds for disqualification. 
If the Presiding Officer does not grant the motion or the person does 
not disqualify himself and the Presiding Officer or such other person 
is not the Commission or a Commissioner, the Commission will decide the 
matter.
    (c) If any person presiding deems himself or herself disqualified, 
he or she shall withdraw by notice on the record after notifying the 
Commission.
    (d) If a Presiding Officer becomes unavailable, the Commission will 
designate a replacement.
    (e) Any motion concerning the designation of a replacement 
Presiding Officer shall be made within 5 days after the designation.
    (f) Unless otherwise ordered by the Commission, the jurisdiction of 
a Presiding Officer other than the Commission commences as designated 
in the hearing notice and terminates upon certification of the hearing 
record to the Commission, or when the Presiding Officer is 
disqualified.


Sec. 2.1320  Responsibility and power of the Presiding Officer in an 
oral hearing.

    (a) The Presiding Officer in any oral hearing shall conduct a fair 
hearing, develop a record that will contribute to informed 
decisionmaking, and, within the framework of the Commission's orders, 
have the power necessary to achieve these ends, including the power to:
    (1) Take action to avoid unnecessary delay and maintain order;
    (2) Dispose of procedural requests;
    (3) Question participants and witnesses, and entertain suggestions 
as to questions which may be asked of participants and witnesses.
    (4) Order consolidation of participants;
    (5) Establish the order of presentation;
    (6) Hold conferences before or during the hearing;
    (7) Establish time limits;
    (8) Limit the number of witnesses; and
    (9) Strike or reject duplicative, unreliable, immaterial, or 
irrelevant presentations.
    (b) Where the Commission itself does not preside:
    (1) The Presiding Officer may certify questions or refer rulings to 
the Commission for decision;
    (2) Any hearing order may be modified by the Commission; and
    (3) The Presiding Officer will certify the completed hearing record 
to the Commission, which may then issue its decision on the hearing or 
provide that additional testimony be presented.


Sec. 2.1321  Participation and schedule for submission in a hearing 
consisting of written comments.

    Unless otherwise limited by this subpart or by the Commission, 
participants in a hearing consisting of written comments may submit:
    (a) Initial written statements of position and written testimony 
with supporting affidavits on the issues. These materials shall be 
filed within 30 days of the date of the Commission's Notice granting a 
hearing pursuant to Sec. 2.1308(d)(1), unless the Commission or 
Presiding Officer directs otherwise.
    (b) Written responses, rebuttal testimony with supporting 
affidavits directed to the initial statements and testimony of other 
participants, and proposed written questions for the Presiding Officer 
to consider for

[[Page 66734]]

submittal to persons sponsoring testimony submitted under paragraph (a) 
of this section. These materials shall to filed within 20 days of the 
filing of the materials submitted under paragraph (a) of this section, 
unless the Commission or Presiding Officer directs otherwise. Proposed 
written questions directed to rebuttal testimony for the Presiding 
Officer to consider for submittal to persons offering such testimony 
shall be filed within 7 days of the filing of the rebuttal testimony.
    (c) Written concluding statements of position on the issues. These 
materials shall be filed within 20 days of the filing of the materials 
submitted under paragraph (b) of this section, unless the Commission or 
the Presiding Officer directs otherwise.


Sec. 2.1322  Participation and schedule for submissions in an oral 
hearing.

    (a) Unless otherwise limited by this subpart or by the Commission, 
participants in an oral hearing may submit and sponsor in the hearings:
    (1) Initial written statements of position and written testimony 
with supporting affidavits on the issues. These materials shall be 
filed within 30 days of the date of the Commission's notice granting a 
hearing pursuant to Sec. 2.1308(d)(1), unless the Commission or 
Presiding Officer directs otherwise.
    (2)(i) Written responses and rebuttal testimony with supporting 
affidavits directed to the initial statements and testimony of other 
participants;
    (ii) Proposed questions for the Presiding Officer to consider for 
propounding to persons sponsoring testimony.
    (3) These materials must be filed within 20 days of the filing of 
the materials submitted under paragraph (a)(1) of this section, unless 
the Commission or Presiding Officer directs otherwise.
    (4) Proposed questions directed to rebuttal testimony for the 
Presiding Officer to consider for propounding to persons offering such 
testimony shall be filed within 7 days of the filing of the rebuttal 
testimony.
    (b) The oral hearing should commence within 65 days of the date of 
the Commission's notice granting a hearing unless the Commission or 
Presiding Officer directs otherwise. Ordinarily, questioning in the 
oral hearing will be conducted by the Presiding Officer, using either 
the Presiding Officer's questions or questions submitted by the 
participants or a combination of both.
    (c) Written post-hearing statements of position on the issues 
addressed in the oral hearing may be submitted within 20 days of the 
close of the oral hearing.
    (d) The Commission, on its own motion, or in response to a request 
from a Presiding Officer other than the Commission, may use additional 
procedures, such as direct and cross-examination, or may convene a 
formal hearing under subpart G of this part on specific and substantial 
disputes of fact, necessary for the Commission's decision, that cannot 
be resolved with sufficient accuracy except in a formal hearing. The 
staff will be a party in any such formal hearing. Neither the 
Commission nor the Presiding Officer will entertain motions from the 
parties that request such special procedures or formal hearings.


Sec. 2.1323  Presentation of testimony in an oral hearing.

    (a) All direct testimony in an oral hearing shall be filed no later 
than 15 days before the hearing or as otherwise ordered or allowed 
pursuant to the provisions of Sec. 2.1322.
    (b) Written testimony will be received into evidence in exhibit 
form.
    (c) Participants may designate and present their own witnesses to 
the Presiding Officer.
    (d) Testimony for the NRC staff will be presented only by persons 
designated by the Executive Director for Operations for that purpose.
    (e) Participants and witnesses will be questioned orally or in 
writing and only by the Presiding Officer. Questions may be addressed 
to individuals or to panels of participants or witnesses.
    (f) The Presiding Officer may accept written testimony from a 
person unable to appear at the hearing, and may request him or her to 
respond to questions.
    (g) No subpoenas will be granted at the request of participants for 
attendance and testimony of participants or witnesses or the production 
of evidence.


Sec. 2.1324  Appearance in an oral hearing.

    (a) A participant may appear in a hearing on her or his own behalf 
or be represented by an authorized representative.
    (b) A person appearing shall file a written notice stating her or 
his name, address and telephone number, and if an authorized 
representative, the basis of her or his eligibility and the name and 
address of the participant on whose behalf she or he appears.
    (c) A person may be excluded from a hearing for disorderly, 
dilatory or contemptuous conduct, provided he or she is informed of the 
grounds and given an opportunity to respond.


Sec. 2.1325  Motions and requests.

    (a) Motions and requests shall be addressed to the Presiding 
Officer, and, if written, also filed with the Secretary and served on 
other participants.
    (b) Other participants may respond to the motion or request. 
Responses to written motions or requests shall be filed within 5 days 
after service unless the Commission or Presiding Officer directs 
otherwise.
    (c) The Presiding Officer may entertain motions for extension of 
time and changes in schedule in accordance with paragraphs (a) and (b) 
of this section.
    (d) When the Commission does not preside, in response to a motion 
or request, the Presiding Officer may refer a ruling or certify a 
question to the Commission for decision and notify the participants.
    (e) Unless otherwise ordered by the Commission, a motion or 
request, or the certification of a question or referral of a ruling, 
shall not stay or extend any aspect of the hearing.


Sec. 2.1326  Burden of proof.

    The applicant or the proponent of an order has the burden of proof.


Sec. 2.1327  Application for a stay of the effectiveness of NRC staff 
action on license transfer.

    (a) Any application for a stay of the effectiveness of the NRC 
staff's order on the license transfer application shall be filed with 
the Commission within 5 days of the issuance of the notice of staff 
action pursuant to Sec. 2.1316(a).
    (b) An application for a stay must be no longer than 10 pages, 
exclusive of affidavits, and must contain:
    (1) A concise summary of the action which is requested to be 
stayed; and
    (2) A concise statement of the grounds for a stay, with reference 
to the factors specified in paragraph (d) of this section.
    (c) Within 10 days after service of an application for a stay under 
this section, any participant may file an answer supporting or opposing 
the granting of a stay. Answers must be no longer than 10 pages, 
exclusive of affidavits, and should concisely address the matters in 
paragraph (b) of this section, as appropriate. No further replies to 
answers will be entertained.
    (d) In determining whether to grant or deny an application for a 
stay, the Commission will consider:
    (1) Whether the requestor will be irreparably injured unless a stay 
is granted;
    (2) Whether the requestor has made a strong showing that it is 
likely to prevail on the merits;

[[Page 66735]]

    (3) Whether the granting of a stay would harm other participants; 
and
    (4) Where the public interest lies.


Sec. 2.1328  Default.

    When a participant fails to act within a specified time, the 
Presiding Officer may consider that participant in default, issue an 
appropriate ruling and proceed without further notice to the defaulting 
participant.


Sec. 2.1329  Waiver of a rule or regulation.

    (a) A participant may petition that a Commission rule or regulation 
be waived with respect to the license transfer application under 
consideration.
    (b) The sole ground for a waiver shall be that, because of special 
circumstances concerning the subject of the hearing, application of a 
rule or regulation would not serve the purposes for which it was 
adopted.
    (c) Waiver petitions shall specify why application of the rule or 
regulation would not serve the purposes for which it was adopted and 
shall be supported by affidavits to the extent applicable.
    (d) Other participants may, within 10 days, file a response to a 
waiver petition.
    (e) When the Commission does not preside, the Presiding Officer 
will certify the waiver petition to the Commission, which, in response, 
will grant or deny the waiver or direct any further proceedings.


Sec. 2.1330  Reporter and transcript for an oral hearing.

    (a) A reporter designated by the Commission will record an oral 
hearing and prepare the official hearing transcript.
    (b) Except for any portions that must be protected from disclosure 
in accordance with law and policy as reflected in 10 CFR 2.790, 
transcripts will be placed in the Public Document Room, and copies may 
be purchased from the Secretary, U.S. Nuclear Regulatory Commission, 
Washington, DC 20555.
    (c) Corrections of the official transcript may be made only as 
specified by the Secretary.


Sec. 2.1331  Commission action.

    (a) Upon completion of a hearing, the Commission will issue a 
written opinion including its decision on the license transfer 
application and the reasons for the decision.
    (b) The decision on issues designated for hearing pursuant to 
Sec. 2.1308 will be based on the record developed at hearing.

PART 51--ENVIRONMENTAL PROTECTION REGULATIONS FOR DOMESTIC 
LICENSING AND RELATED REGULATORY FUNCTIONS

    7. The authority citation for Part 51 continues to read as follows:

    Authority: Sec. 161, 68 Stat. 948, as amended, sec. 1701, 106 
Stat. 2951, 2952, 2953 (42 U.S.C. 2201, 2297f); secs. 201, as 
amended, 202, 88 Stat. 1242, as amended, 1244 (42 U.S.C. 5841, 
5842).
    Subpart A also issued under National Environmental Policy Act of 
1969, secs. 102, 104, 105, 83 Stat. 853-854, as amended (42 U.S.C. 
4332, 4334, 4335); and Pub. L. 95-604, Title II, 92 Stat. 3033-3041; 
and sec. 193, Pub. L. 101-575, 104 Stat. 2835 (42 U.S.C. 2243). 
Section 51.20, 51.30, 51.60, 51.80, and 51.97 also issued under 
secs. 135, 141, Pub. L. 97-425, 96 Stat. 2232, 2241, and sec. 148, 
Pub. L. 100-203, 101 Stat. 1330-223 (42 U.S.C. 10155, 10161, 10168). 
Section 51.22 also issued under sec. 274, 73 Stat. 688, as amended 
by 92 Stat. 3036-3038 (42 U.S.C. 10141). Section 51.43, 51.67, and 
51.109 also under Nuclear Waste Policy Act of 1982, sec 114(f), 96 
Stat. 2216, as amended (42 U.S.C. 10134).

    8. In Sec. 51.22, a new paragraph (c)(21) is added to read as 
follows:


Sec. 51.22  Criterion for categorical exclusion; identification of 
licensing and regulatory actions eligible for categorical exclusion or 
otherwise not requiring environmental review.

* * * * *
    (c) * * *
    (21) Approvals of direct or indirect transfers of any license 
issued by NRC and any associated amendments of license required to 
reflect the approval of a direct or indirect transfer of an NRC 
license.
* * * * *
    Dated at Rockville, Maryland, this 27th day of November 1998.

    For the Nuclear Regulatory Commission.
John C. Hoyle,
Secretary of the Commission.
[FR Doc. 98-32211 Filed 12-2-98; 8:45 am]
BILLING CODE 7590-01-P