[Federal Register Volume 65, Number 59 (Monday, March 27, 2000)]
[Proposed Rules]
[Pages 16250-16272]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-6914]



[[Page 16249]]

-----------------------------------------------------------------------

Part II





Nuclear Regulatory Commission





-----------------------------------------------------------------------



10 CFR Parts 170 and 171



Revision of Fee Schedules; 100% Fee Recovery, FY 2000; Proposed Rule

  Federal Register / Vol. 65, No. 59 / Monday, March 27, 2000 / 
Proposed Rules  

[[Page 16250]]


=======================================================================
-----------------------------------------------------------------------

NUCLEAR REGULATORY COMMISSION

10 CFR Parts 170 and 171

RIN 3150-AG50


Revision of Fee Schedules; 100% Fee Recovery, FY 2000

AGENCY: Nuclear Regulatory Commission.

ACTION: Proposed rule.

-----------------------------------------------------------------------

SUMMARY: The Nuclear Regulatory Commission (NRC) is proposing to amend 
the licensing, inspection, and annual fees charged to its applicants 
and licensees. The proposed amendments are necessary to implement the 
Omnibus Budget Reconciliation Act of 1990 (OBRA-90), as amended, which 
mandates that the NRC recover approximately 100 percent of its budget 
authority in Fiscal Year (FY) 2000, less amounts appropriated from the 
Nuclear Waste Fund (NWF) and the General Fund. The amount to be 
recovered for FY 2000 is approximately $447.0 million.

DATES: The comment period expires April 26, 2000. Comments received 
after this date will be considered if it is practical to do so, but the 
NRC is able to ensure only that comments received on or before this 
date will be considered. Because OBRA-90 requires that NRC collect the 
FY 2000 fees by September 30, 2000, requests for extensions of the 
comment period will not be granted.

ADDRESSES: Mail written comments to: Secretary, U.S. Nuclear Regulatory 
Commission, Washington, DC 20555-0001, ATTN: Rulemakings and 
Adjudications Staff. Hand deliver comments to: 11555 Rockville Pike, 
Rockville, Maryland 20852, between 7:30 am and 4:15 pm Federal 
workdays. (Telephone 301-415-1678).
    Comments may also be submitted via the NRC's interactive rulemaking 
website (http://ruleforum.llnl.gov). This site provides the ability to 
upload comments as files (any format), if your web browser supports 
that function. For information about the interactive rulemaking site, 
contact Ms. Carol Gallagher, 301-415-5905; e-mail [email protected]. Comments 
received may also be viewed and downloaded electronically via this 
interactive rulemaking website.
    With the exception of restricted information, documents created or 
received at the NRC after November 1, 1999, are also available 
electronically at the NRC's Public Electronic Reading Room on the 
Internet at http://www.nrc.gov/NRC/ADAMS/index.html. From this site, 
the public can gain entry into the NRC's Agencywide Document Access and 
Management System (ADAMS), which provides text and image files of NRC's 
public documents. For more information, contact the NRC Public Document 
Room (PDR) Reference staff at 1-800-397-4209, 202-634-3273 or by email 
to [email protected].
    Copies of comments received and the agency workpapers that support 
these proposed changes to 10 CFR Parts 170 and 171 may be examined at 
the NRC Public Document Room, 2120 L Street NW (Lower Level), 
Washington, DC 20555-0001.

FOR FURTHER INFORMATION CONTACT: Glenda Jackson, Office of the Chief 
Financial Officer, U.S. Nuclear Regulatory Commission, Washington, DC 
20555-0001, Telephone 301-415-6057.

SUPPLEMENTARY INFORMATION:
I. Background
II. Proposed Action
III. Plain Language
IV. Voluntary Consensus Standards
V. Environmental Impact: Categorical Exclusion
VI. Paperwork Reduction Act Statement
VII. Regulatory Analysis
VIII. Regulatory Flexibility Analysis
IX. Backfit Analysis

I. Background

    OBRA-90, as amended, requires that the NRC recover approximately 
100 percent of its budget authority, less the amount appropriated from 
the Department of Energy (DOE) administered Nuclear Waste Fund (NWF). 
Certain NRC costs related to reviews and other assistance provided to 
the Department of Energy (DOE) and other Federal agencies were excluded 
from the fee recovery requirement for FY 2000 by the FY 2000 Energy and 
Water Development Appropriations Act.
    The NRC assesses two types of fees to recover its budget authority. 
First, license and inspection fees, established at 10 CFR Part 170 
under the authority of the Independent Offices Appropriation Act of 
1952 (IOAA), 31 U.S.C. 9701, recover the NRC's costs of providing 
special benefits to identifiable applicants and licensees. Examples of 
the services provided by the NRC for which these fees are assessed are 
the review of applications for the issuance of new licenses, approvals 
or renewals, and amendments to licenses or approvals. Second, annual 
fees, established in 10 CFR Part 171 under the authority of OBRA-90, 
recover generic and other regulatory costs not recovered through 10 CFR 
Part 170 fees.
    This proposed rule is based on the current 100 percent fee recovery 
requirement under OBRA-90. To address fairness and equity concerns 
related to NRC licensees paying for agency expenses which do not 
provide a direct benefit to them, the NRC has submitted legislation to 
the Congress which would reduce the fee recovery amount to 98 percent 
for FY 2001, and further reduce the fee recovery amount by an 
additional two percent per year beginning in FY 2002 until the fee 
recovery requirement is reduced to 90 percent by FY 2005.
    Also, in the FY 1999 final fee rule published June 10, 1999 (64 FR 
31450), the NRC responded to a comment requesting that NRC designate as 
small entities, for reduced fee purposes, all those companies with 
small business certification under the U.S. Small Business 
Administration's (SBA) Small Disadvantaged Business Program, commonly 
known as the 8(a) Program. The Commission agreed to give further 
consideration to the issue raised by this commenter.
    The Commission has declined to adopt the suggested approach, for 
the following reasons. On April 11, 1995 (60 FR 18344), the NRC 
promulgated a final rule, after notice and comment rulemaking, that 
revised its size standards. The final rule established the small entity 
classification applicable to small businesses as follows. Those 
companies providing services having no more than $5 million in average 
annual gross receipts over its last three completed fiscal years, or, 
for manufacturing concerns, having an average of 500 or fewer employees 
during the preceding 12-month period would qualify as small entities 
(10 CFR 2.810).
    The NRC promulgated this rule pursuant to Section 3(a)(2) of the 
Small Business Act, which permits Federal agencies to establish size 
standards via notice and comment rulemaking, subject to the approval of 
the SBA Administrator. Unlike the NRC, the SBA's Standard Industrial 
Classification (SIC) System establishes size standards based on types 
of economic activity or industry. The NRC rule, which the SBA approved, 
established generic size standards for small businesses because NRC's 
regulatory scheme is not well suited to setting standards for each 
component of the regulated nuclear industry.

II. Proposed Action

    The NRC is proposing to amend its licensing, inspection, and annual 
fees to recover approximately 100 percent of its FY 2000 budget 
authority, including the

[[Page 16251]]

budget authority for its Office of the Inspector General, less the 
appropriations received from the NWF and the General Fund. For FY 2000, 
the NRC's budget authority is $470.0 million, of which $19.15 million 
has been appropriated from the NWF. In addition, $3.85 million has been 
appropriated from the General Fund for activities related to regulatory 
reviews and other assistance provided to the DOE and other Federal 
agencies. The NRC's FY 2000 Appropriations Act states that this $3.85 
million appropriation shall be excluded from license fee revenues. 
Therefore, the NRC is required to collect approximately $447.0 million 
in FY 2000 through 10 CFR Part 170 licensing and inspection fees and 10 
CFR Part 171 annual fees. The total amount to be recovered in fees for 
FY 2000 is $2.6 million less than the total amount estimated for 
recovery in the NRC's FY 1999 fee rule.
    The NRC estimates that approximately $106.0 million will be 
recovered in FY 2000 from Part 170 fees and other offsetting receipts. 
The remaining $341.0 million would be recovered through the Part 171 
annual fees.
    The NRC also estimates a net adjustment for FY 2000 of 
approximately $5.7 million for the small entity subsidy, for FY 2000 
invoices that would not be paid in FY 2000, and for payments received 
in FY 2000 for FY 1999 invoices. These adjustments are approximately 
$2.5 million more than in FY 1999. In addition, there are approximately 
530 fewer licenses subject to annual fees in FY 2000 than in FY 1999, 
due primarily to Ohio becoming an Agreement State in August, 1999.
    As a result of these changes, the proposed FY 2000 annual fees 
would increase slightly, by approximately 1.4 percent, compared to the 
FY 1999 actual (prior to rounding) annual fees. As a result of 
rounding, the proposed FY 2000 annual fees for several fee categories 
are the same as the final (rounded) FY 1999 annual fees. The change to 
the annual fees is described in more detail in Section B. The following 
examples illustrate the changes in annual fees:

------------------------------------------------------------------------
                                                              FY 2000
                                              FY 1999        proposed
                                            annual fee      annual fee
------------------------------------------------------------------------
Class of Licensees:
    Power Reactors (Including Spent Fuel      $2,776,000      $2,815,000
     Storage/Reactor Decommissioning
     fee)...............................
    Spent Fuel Storage/Reactor                   206,000         209,000
     Decommissioning....................
    Nonpower Reactors...................          85,900          87,100
    High Enriched Uranium Fuel Facility.       3,281,000       3,327,000
    Low Enriched Uranium Fuel Facility..       1,100,000       1,116,000
    UF6 Conversion Facility.............         472,000         478,000
    Uranium Mills.......................         131,000         132,000
Typical Materials Licenses:
    Radiographers.......................          14,700          14,900
    Well Loggers........................           9,900          10,100
    Gauge Users.........................           2,600           2,600
    Broad Scope Medical.................          27,800          28,100
------------------------------------------------------------------------

    The final FY 2000 fee rule will be a ``major'' final action as 
defined by the Small Business Regulatory Enforcement Fairness Act of 
1996. Therefore, the NRC's fees for FY 2000 would become effective 60 
days after publication of the final rule in the Federal Register. The 
NRC will send an invoice for the amount of the annual fee to reactors 
and major fuel cycle facilities upon publication of the FY 2000 final 
rule. For these licensees, payment would be due on the effective date 
of the FY 2000 rule. Those materials licensees whose license 
anniversary date during FY 2000 falls before the effective date of the 
final FY 2000 rule would be billed during the anniversary month of the 
license and continue to pay annual fees at the FY 1999 rate in FY 2000. 
Those materials licensees whose license anniversary date falls on or 
after the effective date of the final FY 2000 rule would be billed at 
the FY 2000 revised rates during the anniversary month of the license 
and payment would be due on the date of the invoice.
    As a matter of courtesy, the NRC plans to continue to mail the 
proposed fee rules to all licensees. However, the NRC announced in FY 
1998 that, as a cost-saving measure, it planned to discontinue mailing 
the final rule to all licensees. Accordingly, the NRC does not plan to 
mail the FY 2000 final rule, or future final rules, to all licensees. 
However, the NRC will send the final rule to any licensee or other 
person upon request. To request a copy, contact the License Fee and 
Accounts Receivable Branch, Division of Accounting and Finance, Office 
of the Chief Financial Officer, at 301-415-7554, or e-mail us at 
[email protected]. It is our intent to publish the final rule in late May or 
early June of 2000. In addition to publication in the Federal Register, 
the final rule will be available on the internet at http://ruleforum.llnl.gov.
    The NRC is also proposing to make other changes to 10 CFR Parts 170 
and 171 as discussed in Sections A and B below:

A. Amendments to 10 CFR Part 170: Fees for Facilities, Materials, 
Import and Export Licenses, and Other Regulatory Services Under the 
Atomic Energy Act of 1954, as Amended

    The NRC is proposing to revise the hourly rates used to calculate 
fees and to adjust the 10 CFR Part 170 fees based on the revised hourly 
rates. The NRC is also proposing an administrative amendment to 
Sec. 170.12(c) to clarify that the site to which a resident inspector 
is assigned will not be assessed Part 170 fees for time spent by the 
resident inspector in support of activities at another site. The 
proposed amendments are as follows:
1. Hourly Rates
    The NRC is proposing to revise the two professional hourly rates 
for NRC staff time established in Sec. 170.20. These proposed rates 
would be based on the number of FY 2000 direct program full time 
equivalents (FTEs) and the FY 2000 NRC budget, excluding direct program 
support costs and NRC's appropriations from the NWF and the General 
Fund. These rates are used to determine the Part 170 fees. The

[[Page 16252]]

proposed hourly rate for the reactor program is $144 per hour ($255,844 
per direct FTE). This rate would be applicable to all activities for 
which fees are based on full cost under Sec. 170.21 of the fee 
regulations. The proposed hourly rate for the nuclear materials and 
nuclear waste program is $143 per hour ($253,450 per direct FTE). This 
rate would be applicable to all activities for which fees are based on 
full cost under Sec. 170.31 of the fee regulations. In the FY 1999 
final fee rule, these rates were $141 and $140, respectively. The 
proposed increase is primarily due to the Government-wide pay increase 
in FY 2000.
    The method used to determine the two professional hourly rates is 
as follows:
    a. Direct program FTE levels are identified for the reactor program 
and the nuclear material and waste program.
    b. Direct contract support, which is the use of contract or other 
services in support of the line organization's direct program, is 
excluded from the calculation of the hourly rates because the costs for 
direct contract support are charged directly through the various 
categories of fees.
    c. All other direct program costs (i.e., Salaries and Benefits, 
Travel) represent ``in-house'' costs and are allocated by dividing them 
uniformly by the total number of direct FTEs for the program. In 
addition, salaries and benefits plus contracts for non-program direct 
management and support, and the Office of the Inspector General are 
allocated to each program based on that program's direct costs. This 
method results in the following costs which are included in the hourly 
rates.

    Table 1. FY 2000 Budget Authority To Be Included in Hourly Rates
------------------------------------------------------------------------
                                              Reactor        Materials
                                              program         program
------------------------------------------------------------------------
Direct Program Salaries & Benefits......        $103.3M          $29.0M
Overhead Salaries & Benefits, Program             53.2M           15.3M
 Travel and Other Support...............
Allocated Agency Management and Support.          98.8M           27.9M
                                         -------------------------------
    Subtotal............................        $255.3M          $72.2M
Less offsetting receipts................           -.1M   ..............
                                         -------------------------------
    Total Budget Included in Hourly Rate        $255.2M          $72.2M
Program Direct FTEs.....................         997.5           284.9
Rate per Direct FTE.....................     255,844         253,450
Professional Hourly Rate (Rate per               144             143
 direct FTE divided by 1,776 hours).....
------------------------------------------------------------------------

    As shown in Table I, dividing the $255.2 million (rounded) budgeted 
amount included in the hourly rate for the reactor program by the 
reactor program direct FTEs (997.5) results in a rate for the reactor 
program of $255,844 per FTE for FY 2000. The Direct FTE Hourly Rate for 
the reactor program would be $144 per hour (rounded to the nearest 
whole dollar). This rate is calculated by dividing the cost per direct 
FTE ($255,844) by the number of productive hours in one year (1,776 
hours) as set forth in the revised OMB Circular A-76, ``Performance of 
Commercial Activities.'' Dividing the $72.2 million (rounded) budgeted 
amount included in the hourly rate for the nuclear materials and 
nuclear waste program by the program direct FTEs (284.9) results in a 
rate of $253,450 per FTE for FY 2000. The Direct FTE Hourly Rate for 
the materials program would be $143 per hour (rounded to the nearest 
whole dollar). This rate is calculated by dividing the cost per direct 
FTE ($253,450) by the number of productive hours in one year (1,776 
hours).
2. Fee Adjustments
    The NRC is proposing to adjust the current Part 170 fees in 
Secs. 170.21 and 170.31 to reflect the changes in the revised hourly 
rates. The full cost fees assessed under Secs. 170.21 and 170.31 would 
be based on the proposed professional hourly rates and any direct 
program support (contractual services) costs expended by the NRC. Any 
professional hours expended on or after the effective date of the final 
rule would be assessed at the FY 2000 hourly rates.
    The fees in Secs. 170.21 and 170.31 that are based on the average 
time to review an application (``flat'' fees) would be adjusted to 
reflect the increase in the professional hourly rates from FY 1999. The 
amounts of the materials licensing ``flat'' fees were rounded so that 
the amounts would be de minimis and the resulting flat fee would be 
convenient to the user. Fees under $1,000 are rounded to the nearest 
$10. Fees that are greater than $1,000 but less than $100,000 are 
rounded to the nearest $100. Fees that are greater than $100,000 are 
rounded to the nearest $1,000.
    The proposed licensing ``flat'' fees are applicable to fee 
categories K.1 through K.5 of Sec. 170.21, and fee categories 1.C, 1.D, 
2.B, 2.C, 3.A through 3.P, 4.B through 9.D, 10.B, 15.A through 15.E, 
and 16 of Sec. 170.31. Applications filed on or after the effective 
date of the final rule would be subject to the revised fees in this 
proposed rule.
3. Administrative Amendment
    The NRC is proposing to amend Sec. 170.12(c)(1) to clarify that the 
fees assessed for a resident inspector's time will exclude time spent 
by the resident inspector in support of activities at another site. 
This provision was inadvertently omitted from the revision of 10 CFR 
170 in the FY 1999 fee rule.
4. Other
    The NRC solicited public comment in the FY 1999 proposed fee 
rulemaking (April 1, 1999; 64 FR 15878) on whether to include the 
development of orders, evaluation of responses to orders, development 
of Notices of Violations (NOVs) accompanying escalated enforcement 
actions, and evaluation of responses to NOVs in the fees collected for 
identifiable services under Part 170 in the FY 2000 proposed fee rule. 
Those commenting on this issue presented arguments both for and against 
assessing Part 170 fees for these activities. The NRC stated in the 
final fee rulemaking (June 10, 1999; 64 FR 31452), that it would 
further evaluate this issue prior to promulgation of the FY 2000 fee 
rule.
    Three of the four commenters who addressed this issue in FY 1999 
did not support recovering the costs for these activities under Part 
170. These commenters were concerned that assessing these costs to the 
specific licensees under Part 170 could be viewed as penalizing the 
licensee when the licensee identifies and corrects violations. One 
commenter supported Part 170 fee assessment for escalated enforcement 
actions, indicating that it is

[[Page 16253]]

inappropriate for one licensee to subsidize oversight for another 
licensee. This commenter also stated that the perception that these 
actions serve as an industry-wide deterrent is not borne out.
    In addition to concerns raised by the commenters, there are other 
problems with assessing Part 170 fees for these activities. These 
problems include the handling of escalated enforcement costs if the 
enforcement action is reduced to a non-escalated enforcement action or 
is dropped altogether. Based on the public comments received in FY 1999 
and legal and policy concerns, the NRC will continue to recover costs 
for orders and escalated enforcement actions through Part 171 annual 
fees.
    In summary, the NRC is proposing to amend 10 CFR Part 170 to:
    1. Revise the two hourly rates;
    2. Revise the licensing fees to be assessed to reflect the revised 
hourly rates; and
    3. Make an administrative amendment to Sec. 170.12(c) to clarify 
that the site to which a resident inspector is assigned will not be 
assessed Part 170 fees for time spent by the resident inspector in 
support of activities at another site.

B. Amendments to 10 CFR Part 171: Annual Fees for Reactor Licenses, and 
Fuel Cycle Licenses and Materials Licenses, Including Holders of 
Certificates of Compliance, Registrations, and Quality Assurance 
Program Approvals, and Government Agencies Licensed by the NRC

    The NRC proposes to revise the annual fees for FY 2000, to increase 
the maximum annual fees assessed to those licensees who qualify as 
small entities, and to make several administrative amendments. The 
proposed amendments are as follows:
1. Annual Fees
    The NRC proposes to amend Secs. 171.15 and 171.16 to revise the 
annual fees for FY 2000 to recover approximately 100 percent of the FY 
2000 budget authority, less fees collected under 10 CFR Part 170 and 
funds appropriated from the NWF and the General Fund. In the FY 1995 
final rule, the NRC stated that it would stabilize annual fees as 
follows. Beginning in FY 1996, the NRC would adjust the annual fees 
only by the percentage change (plus or minus) in NRC's total budget 
authority, unless there was a substantial change in the total NRC 
budget authority or the magnitude of the budget allocated to a specific 
class of licensees. If either case should occur, the annual fee base 
would be recalculated (June 20, 1995; 60 FR 32225). The NRC also 
indicated that the percentage change would be adjusted based on changes 
in 10 CFR Part 170 fees and other adjustments as well as on the number 
of licensees paying the fees. In addition, beginning in FY 1997, the 
NRC made an adjustment to recognize that all fees billed in a fiscal 
year are not collected in that year.
    In the FY 1999 proposed fee rule (April 1, 1999; 63 FR 15884), 
public comment was solicited on whether the NRC should, in future 
years, continue to use the percent change method and rebaseline annual 
fees every several years, as established in FY 1995, or return to a 
policy of rebaselining annual fees every year. The majority of those 
commenting on the frequency for rebaselining annual fees supported 
rebaselining every several years, as warranted. Based on the comments 
received, licensees have continuing concerns about fee stability. 
Therefore, in the final FY 1999 fee rule (64 FR 31448; June 10, 1999), 
the NRC stated that it is continuing the policy of adjusting the annual 
fees only by the percent change in the NRC's total budget, with 
additional adjustments for the numbers of licensees paying fees, 
changes in Part 170 fees, and other adjustments that may be required, 
unless there is a substantial change in the total NRC budget or the 
magnitude of the budget allocated to a specific class of licensees, in 
which case the annual fee base would be reestablished. However, based 
on experience gained from applying the criteria from FY 1996 to FY 
1999, the Commission determined that, in the future, annual fees should 
be rebaselined at least every three years, or earlier, if warranted.
    After evaluating NRC's budget data for FY 2000 and concluding that 
there has not been a substantial change in the NRC budget or in the 
magnitude of a specific budget allocation to a class of licensees, the 
NRC intends to continue to stabilize annual fees by adjusting the FY 
1999 annual fees by the percent change in the NRC's total budget, with 
adjustments for the number of licensees paying fees, changes in 
estimated Part 170 collections and other offsetting receipts, and other 
changes required to assure that the amounts billed result in the 
required collections.
    The $447.0 million to be recovered through Part 170 and Part 171 
fees for FY 2000 is $2.6 million less than the total amount estimated 
for recovery in the NRC's FY 1999 fee rule. The NRC estimates that 
approximately $106.0 million will be recovered in FY 2000 from Part 170 
fees and other offsetting receipts, compared to $107.7 million in FY 
1999, a $1.7 million decrease. As the NRC explained in the FY 1999 
proposed and final fee rules (April 1, 1999; 64 FR 15876 and June 10, 
1999; 64 FR 31458), the amount for FY 1999 included a $4.1 million 
carryover from additional FY 1998 collections which reduced the total 
fee recovery amount for FY 1999. This circumstance does not exist for 
FY 2000. The $1.7 million decrease for FY 2000 is the difference 
between the $4.1 million reduction available in FY 1999 from FY 1998 
collections and an estimated $2.4 million increase in Part 170 
collections FY 2000 compared to FY 1999. The increase in estimated Part 
170 collections, from $103.5 in FY 1999 to $105.9 for FY 2000, is 
largely attributable to changes in Commission policy included in the FY 
1999 final fee rule, such as billing full cost under Part 170 for 
project managers, performance assessments, incident investigations, and 
reviews of reports and other documents that do not require formal or 
legal approval.
    The remaining $341.0 million ($447.0 million total FY 2000 fee 
recovery amount less $106.0 million for estimated Part 170 collections 
and other receipts) would be recovered through the Part 171 annual 
fees. The $341.0 million annual fee recovery amount for FY 2000 is 
approximately $1.0 million less than in FY 1999.
    In addition to the slight reduction in the amount to be recovered 
through annual fees, the NRC estimates a net annual fee billing 
adjustment of approximately $5.7 million for FY 2000 resulting from: 
(1) Bills that will not be paid in FY 2000; (2) the small entity 
subsidy; and (3) payments received in FY 2000 for FY 1999 invoices. The 
billing adjustment, which is necessary to assure that the ``billed'' 
amount results in the required collections, is approximately $2.5 
million more than in FY 1999.
    In addition to these changes, there are approximately 530 fewer 
licenses subject to annual fees in FY 2000 than in FY 1999, due 
primarily to Ohio becoming an Agreement State in August 1999. As a 
result of these changes, the proposed FY 2000 annual fees would 
increase slightly, by approximately 1.4 percent, compared to the FY 
1999 actual (prior to rounding) annual fees. As a result of rounding, 
the proposed FY 2000 annual fees for several fee categories are the 
same as the final (rounded) FY 1999 annual fees. The effects of these 
changes on the annual fees are shown in Table II.

[[Page 16254]]



  Table II.--Calculation of the Percentage Change to the FY 1999 Annual
                                  Fees
                          [Dollars in millions]
------------------------------------------------------------------------
                                              FY 1999         FY 2000
------------------------------------------------------------------------
Total Budget............................         $469.80         $470.0
    Less NWF............................          -17.00          -19.15
    Less General Fund (Regulatory                  -3.20           -3.85
     reviews, and other assistance to
     other Federal agencies)............
                                         -------------------------------
Total Fee Base..........................         $449.60         $447.00
    Less Part 170 Fees..................         -103.50         -105.90
    Less other receipts.................           -4.20           -0.10
                                         -------------------------------
Part 171 Fee Collections Required.......         $341.90         $341.00
Part 171 Billing Adjustment:\1\
    Small Entity Allowance..............            5.30            5.60
    Estimated Unpaid Current FY Part 171            3.40            3.30
     Invoices...........................
    Estimated Payments from Prior Year             -5.50           -3.20
     Invoices...........................
                                         -------------------------------
        Subtotal........................            3.20            5.70
                                         ===============================
        Total Part 171 Billing..........         $345.10         $346.70 
------------------------------------------------------------------------
\1\ These adjustments are necessary to ensure that the ``billed'' amount
  results in the required collections. Positive amounts indicate amounts
  billed that will not be collected in FY 2000.

2. Small Entity Annual Fees
    The NRC is proposing to increase the current maximum small entity 
annual fee and the lower tier small entity annual fee by 25 percent. 
The maximum small entity annual fee would be increased from $1,800 to 
$2,300, and the lower tier small entity fee would be increased from 
$400 to $500. The current maximum small entity annual fee was 
established in FY 1991; the current lower tier small entity annual fee 
was established in FY 1992. The proposed 25 percent increase is 
consistent with the increase in NRC fees for other NRC materials 
licensees since FY 1991. The proposed increase is less than the 
increase in the average fees paid by small entity licensees in 
Agreement States during this time.
    Between 1991 and 1999, changes in both the external and internal 
environment have affected NRC's costs and those of its licensees. 
Increases in the NRC materials license fees, Agreement States' 
materials license fees, and the Consumer Price Index all indicate that 
the NRC small entity fee established in 1991 should be revised. In 
addition, the structure of the fees that NRC charges to its materials 
licensees changed during the period between 1991 and 1999. In the past, 
costs for materials license inspections, renewals, and amendments were 
recovered through Part 170 fees for services. The costs of these 
activities are now included in the Part 171 annual fees assessed to 
materials licensees.
    While the annual fees increased for most materials licensees as a 
result of these changes, the NRC's annual fees assessed to small 
entities have not been adjusted to include the additional costs. As a 
result, small entities are currently paying a smaller percentage of the 
total NRC regulatory costs related to them than they did in FY 1991 and 
FY 1992 when the small entity fees were established.
    Based on the changes that have occurred since FY 1991, the NRC has 
reanalyzed its maximum small entity annual fee. As part of the 
reanalysis, the NRC considered the 1999 fees assessed by Agreement 
States, the NRC's FY 1999 fee structure, and the increase in the 
Consumer Price Index between FY 1991 and FY 1999. The reanalysis and 
alternatives considered by the NRC for revising the small entity annual 
fees are described in the Regulatory Flexibility Analysis, which is 
Appendix A to this proposed rule.
    In the future, the NRC plans to re-examine the small entity fees 
each year that annual fees are rebaselined.
3. Administrative Amendments
    a. The NRC is proposing to revise Sec. 171.5, Definitions, to 
include Certificates of Compliance (Certificates) issued under Part 76. 
The NRC issued two Certificates of Compliance under Part 76 to the 
United States Enrichment Corporation (USEC) for the operation of the 
gaseous diffusion uranium enrichment plants located at Paducah, 
Kentucky, and Piketon, Ohio. This proposal would add Part 76 
Certificates to the definition of Materials License in Sec. 171.5. This 
proposed change is an administrative change to codify agency practice 
in the definitions for 10 CFR Part 171. Section 171.16(a)(1) already 
provides that annual fees covered by the section apply to person(s) 
authorized to conduct activities under 10 CFR Part 76 for uranium 
enrichment. USEC has been subject to annual fees since FY 1997.
    b. Section 171.15 would be revised as follows:
    (1) Paragraphs (b) and (c) of Sec. 171.15 would be revised in their 
entirety to establish the FY 2000 annual fees for operating power 
reactors, power reactors in decommissioning or possession only status, 
and Part 72 licensees who do not hold Part 50 licenses. The fees would 
be established by increasing the FY 1999 actual (prior to rounding) 
annual fees by approximately 1.4 percent. In the FY 1999 fee rule, the 
NRC stated it would continue to stabilize annual fees by adjusting the 
annual fees only by the percentage change (plus or minus) in NRC's 
total budget authority, adjusted for changes in estimated collections 
for 10 CFR Part 170 fees, the number of licensees paying annual fees, 
and other adjustments that may be required, unless there is a 
substantial change in the total NRC budget or the magnitude of the 
budget allocated to a specific class of licensees, in which case the 
annual fee base would be reestablished. The activities comprising the 
FY 1999 base annual fees and the additional charge (surcharge) are 
listed in Sec. 171.15(b)(2), (c)(2) and (d)(1) for convenience 
purposes.
    Each operating power reactor would pay an FY 2000 annual fee of 
$2,815,000, which includes the proposed annual fee of $209,000 for 
spent fuel storage/reactor decommissioning. Each power reactor holding 
a Part 50 license that is in decommissioning or possession only status 
and has spent fuel on-site and each independent spent fuel storage Part

[[Page 16255]]

72 licensee who does not hold a Part 50 license would pay the spent 
fuel storage/reactor decommissioning annual fee of $209,000 in FY 2000.
    (2) Paragraph (e) of Sec. 171.15 would be revised to establish the 
FY 2000 annual fee for non-power (test and research) reactors. The fee 
would be established by increasing the FY 1999 actual (prior to 
rounding) annual fee by approximately 1.4 percent. Each non-power 
reactor would pay an annual fee of $87,100 in FY 2000. The NRC would 
continue to grant exemptions from the annual fee to Federally-owned and 
State-owned research and test reactors that meet the exemption criteria 
specified in Sec. 171.11(a)(2).
    c. Section 171.16 would be amended as follows:
    (1) Section 171.16(c) covers the fees assessed for those licensees 
that can qualify as small entities under NRC size standards. A 
materials licensee may pay a reduced annual fee if the licensee 
qualifies as a small entity under the NRC's size standards and 
certifies that it is a small entity using NRC Form 526. This section 
would be revised to reflect the proposed 25 percent increase in the 
small entity fees. The NRC would maintain a two-tier fee structure for 
licensees that qualify as small entities under the NRC's size 
standards. In general, licensees who qualify as small entities would 
pay a maximum annual fee of $2,300. A second or lower-tier small entity 
fee of $500 would be in place for those licensees who are considered to 
be very small entities for the purposes of this regulation.
    (2) Section 171.16(d) would be revised to establish the FY 2000 
annual fees for materials licensees, including Government agencies, 
licensed by the NRC. The proposed FY 2000 annual fees were determined 
by increasing the FY 1999 actual (prior to rounding) annual fees by 
approximately 1.4 percent. After rounding, the FY 2000 annual fees for 
several categories of materials licenses would be the same as in FY 
1999. The amount or range of the proposed FY 2000 annual fees for 
materials licenses is summarized as follows:

                  Materials Licenses--Annual Fee Ranges
------------------------------------------------------------------------
         Category of license                      Annual fees
------------------------------------------------------------------------
Part 70--High enriched fuel facility  $3,327,000
Part 70--Low enriched fuel facility.  1,116,000
Part 40--UF6 conversion facility....  478,000
Part 40--Uranium recovery facilities  30,800 to 132,000
Part 30--Byproduct Material Licenses  620 to 28,100 1
Part 71--Transportation of            2,300 to 67,600
 Radioactive Material.
------------------------------------------------------------------------
1Excludes the annual fee for a few military ``master'' materials
  licenses of broad-scope issued to Government agencies, which is
  $363,000.

    (3) Footnote 1 of Sec. 171.16(d) would be amended to provide a 
waiver of the annual fees for materials licensees, and holders of 
certificates, registrations, and approvals, who either filed for 
termination of their licenses or approvals or filed for possession 
only/storage only licenses before October 1, 1999, and permanently 
ceased licensed activities entirely by September 30, 1999. All other 
licensees and approval holders who held a license or approval on 
October 1, 1999, would be subject to the FY 2000 annual fees.
    Holders of new licenses issued during FY 2000 would be subject to a 
prorated annual fee in accordance with the current proration provision 
of Sec. 171.17. For example, those new materials licenses issued during 
the period October 1, 1999, through March 31, 2000, would be assessed 
one-half the annual fee in effect on the anniversary date of the 
license. New materials licenses issued on or after April 1, 2000, would 
not be assessed an annual fee for FY 2000. Thereafter, the full annual 
fee would be due and payable each subsequent fiscal year on the 
anniversary date of the license. Beginning June 11, 1996 (the effective 
date of the FY 1996 final rule), affected materials licensees are 
subject to the annual fee in effect on the anniversary date of the 
license. The anniversary date of the materials license for annual fee 
purposes is the first day of the month in which the original license 
was issued.
    d. Section 171.19 Payment, would be amended as follows:
    (1) Section 171.19(b) would be revised to update the fiscal year 
references, and to give credit for partial payments made by certain 
licensees in FY 2000 toward their FY 2000 annual fees. The NRC 
anticipates that the first, second, and third quarterly payments for FY 
2000 will have been made by operating power reactor licensees and some 
large materials licensees before the final rule becomes effective. 
Therefore, the NRC would credit payments received for those quarterly 
annual fee assessments toward the total annual fee to be assessed. The 
NRC would adjust the fourth quarterly invoice to recover the full 
amount of the revised annual fee or to make refunds, as necessary. 
Payment of the annual fee is due on the date of the invoice and 
interest accrues from the invoice date. However, interest would be 
waived if payment is received within 30 days from the invoice date.
    (2) The remainder of this section, although unchanged, is presented 
for the convenience of the user. As in FY 1999, the NRC would continue 
to bill annual fees for most materials licenses on the anniversary date 
of the license (licensees whose annual fees are $100,000 or more would 
continue to be assessed quarterly). The annual fee assessed would be 
the fee in effect on the license anniversary date, unless the annual 
fee for the prior year was less than $100,000 and the revised annual 
fee for the current fiscal year is $100,000 or more. In this case, the 
revised amount would be billed to the licensees upon publication of the 
final rule in the Federal Register, adjusted for any annual fee 
payments already made for that fiscal year based on the anniversary 
month billing process. For FY 2000, the anniversary date billing 
process applies to those materials licenses in the following fee 
categories: 1C, 1D, 2A(2) Other, 2A(3), 2A(4), 2B, 2C, 3A through 3P, 
4A through 9D, 10A, and 10B. For annual fee purposes, the anniversary 
date of the materials license is considered to be the first day of the 
month in which the original materials license was issued. For example, 
if the original materials license was issued on June 17 then, for 
annual fee purposes, the anniversary date of the materials license is 
June 1 and the licensee would continue to be billed in June of each 
year for the annual fee in effect on June 1. Materials licensees with 
anniversary dates in FY 2000 before the effective date of the FY 2000 
final rule would be billed during the anniversary month of the license 
and continue to pay annual fees at the FY 1999 rate in FY 2000. Those 
materials licensees with license anniversary dates falling on or after 
the

[[Page 16256]]

effective date of the FY 2000 final rule would be billed at the FY 2000 
revised rates during the anniversary month of their license.
    The NRC reemphasizes that the annual fee will be assessed based on 
whether a licensee holds a valid NRC license that authorizes possession 
and use of radioactive material.
    In summary, the NRC is proposing to:
    1. Use the percent change method to determine annual fees for FY 
2000. The FY 2000 annual fee for each license fee category would be 
determined by increasing the FY 1999 actual annual fee by approximately 
1.4 percent;
    2. Increase the maximum small entity annual fee from $1,800 to 
$2,300 and increase the lower tier small entity fee from $400 to $500; 
and
    3. Add Certificates of Compliance issued under Part 76 to the 
definition of Materials License in Sec. 171.5.

III. Plain Language

    The Presidential Memorandum dated June 1, 1998, entitled, ``Plain 
Language in Government Writing,'' directed that the Federal 
government's writing be in plain language (63 FR 31883; June 10, 1998). 
The NRC requests comments on this proposed rule specifically with 
respect to the clarity and effectiveness of the language used. Comments 
on the language used should be sent to the NRC as indicated under the 
ADDRESSES heading.

IV. Voluntary Consensus Standards

    The National Technology Transfer and Advancement Act of 1995, Pub. 
L. 104-113, requires that Federal agencies use technical standards that 
are developed or adopted by voluntary consensus standards bodies unless 
using such a standard is inconsistent with applicable law or otherwise 
impractical. In this proposed rule, the NRC is amending the licensing, 
inspection, and annual fees charged to its licensees and applicants as 
necessary to recover approximately 100 percent of its budget authority 
in FY 2000 as is required by the Omnibus Budget Reconciliation Act of 
1990, as amended. This action does not constitute the establishment of 
a standard that contains generally applicable requirements.

V. Environmental Impact: Categorical Exclusion

    The NRC has determined that this proposed rule is the type of 
action described in categorical exclusion 10 CFR 51.22(c)(1). 
Therefore, neither an environmental impact statement nor an 
environmental impact assessment has been prepared for the proposed 
regulation. By its very nature, this regulatory action does not affect 
the environment, and therefore, no environmental justice issues are 
raised.

VI. Paperwork Reduction Act Statement

    This proposed rule contains no information collection requirements 
and, therefore, is not subject to the requirements of the Paperwork 
Reduction Act of 1995 (44 U.S.C. 3501 et seq.).

VII. Regulatory Analysis

    With respect to 10 CFR Part 170, this proposed rule was developed 
pursuant to Title V of the Independent Offices Appropriation Act of 
1952 (IOAA) (31 U.S.C. 9701) and the Commission's fee guidelines. When 
developing these guidelines the Commission took into account guidance 
provided by the U.S. Supreme Court on March 4, 1974, in National Cable 
Television Association, Inc. v. United States, 415 U.S. 36 (1974) and 
Federal Power Commission v. New England Power Company, 415 U.S. 345 
(1974). In these decisions, the Court held that the IOAA authorizes an 
agency to charge fees for special benefits rendered to identifiable 
persons measured by the ``value to the recipient'' of the agency 
service. The meaning of the IOAA was further clarified on December 16, 
1976, by four decisions of the U.S. Court of Appeals for the District 
of Columbia: National Cable Television Association v. Federal 
Communications Commission, 554 F.2d 1094 (D.C. Cir. 1976); National 
Association of Broadcasters v. Federal Communications Commission, 554 
F.2d 1118 (D.C. Cir. 1976); Electronic Industries Association v. 
Federal Communications Commission, 554 F.2d 1109 (D.C. Cir. 1976) and 
Capital Cities Communication, Inc. v. Federal Communications 
Commission, 554 F.2d 1135 (D.C. Cir. 1976). The Commission's fee 
guidelines were developed based on these legal decisions.
    The Commission's fee guidelines were upheld on August 24, 1979, by 
the U.S. Court of Appeals for the Fifth Circuit in Mississippi Power 
and Light Co. v. U.S. Nuclear Regulatory Commission, 601 F.2d 223 (5th 
Cir. 1979), cert. denied, 444 U.S. 1102 (1980). This court held that--
    (1) The NRC had the authority to recover the full cost of providing 
services to identifiable beneficiaries;
    (2) The NRC could properly assess a fee for the costs of providing 
routine inspections necessary to ensure a licensee's compliance with 
the Atomic Energy Act and with applicable regulations;
    (3) The NRC could charge for costs incurred in conducting 
environmental reviews required by NEPA;
    (4) The NRC properly included the costs of uncontested hearings and 
of administrative and technical support services in the fee schedule;
    (5) The NRC could assess a fee for renewing a license to operate a 
low-level radioactive waste burial site; and
    (6) The NRC's fees were not arbitrary or capricious.
    With respect to 10 CFR Part 171, on November 5, 1990, the Congress 
passed Pub. L. 101-508, the Omnibus Budget Reconciliation Act of 1990 
(OBRA-90), which required that, for FYs 1991 through 1995, 
approximately 100 percent of the NRC budget authority be recovered 
through the assessment of fees. OBRA-90 was amended in 1999 to extend 
the 100 percent fee recovery requirement for the NRC through FY 2000. 
To comply with this statutory requirement, and in accordance with 
Sec. 171.13, the NRC is publishing the proposed amount of the FY 2000 
annual fees for reactor licensees, fuel cycle licensees, materials 
licensees, and holders of Certificates of Compliance, registrations of 
sealed source and devices and QA program approvals, and Government 
agencies. OBRA-90, consistent with the accompanying Conference 
Committee Report, and the amendments to OBRA-90, provide that--
    (1) The annual fees be based on the Commission's FY 2000 budget of 
$470.0 million less the amounts collected from Part 170 fees and the 
funds directly appropriated from the NWF to cover the NRC's high level 
waste program;
    (2) The annual fees shall, to the maximum extent practicable, have 
a reasonable relationship to the cost of regulatory services provided 
by the Commission; and
    (3) The annual fees be assessed to those licensees the Commission, 
in its discretion, determines can fairly, equitably, and practicably 
contribute to their payment.
    In addition, the NRC's FY 2000 appropriations language provides 
that $3.85 million appropriated from the General Fund for activities 
related to regulatory reviews and other assistance provided to the 
Department of Energy and other Federal agencies be excluded from fee 
recovery.
    10 CFR Part 171, which established annual fees for operating power 
reactors effective October 20, 1986 (51 FR 33224; September 18, 1986), 
was challenged and upheld in its entirety in Florida Power and Light 
Company v. United States, 846 F.2d 765 (D.C. Cir. 1988), cert. denied, 
490 U.S. 1045 (1989).

[[Page 16257]]

Further, the NRC's FY 1991 annual fee rule methodology was upheld by 
the D.C. Circuit Court of Appeals in Allied Signal v. NRC, 988 F.2d 146 
(D.C. Cir. 1993).

VIII. Regulatory Flexibility Analysis

    The NRC is required by the Omnibus Budget Reconciliation Act of 
1990 to recover approximately 100 percent of its budget authority 
through the assessment of user fees. OBRA-90 further requires that the 
NRC establish a schedule of charges that fairly and equitably allocates 
the aggregate amount of these charges among licensees.
    This proposed rule establishes the schedules of fees that are 
necessary to implement the Congressional mandate for FY 2000. The 
proposed rule would result in increases in the annual fees charged to 
licensees and holders of certificates, registrations, and approvals, 
including those that qualify as a small entity under NRC's size 
standards in 10 CFR 2.810. The Regulatory Flexibility Analysis, 
prepared in accordance with 5 U.S.C. 604, is included as Appendix A to 
this proposed rule.
    The Small Business Regulatory Enforcement Fairness Act of 1996 
(SBREFA) was signed into law on March 29, 1996. The SBREFA requires all 
Federal agencies to prepare a written compliance guide for each rule 
for which the agency is required by 5 U.S.C. 604 to prepare a 
regulatory flexibility analysis. Therefore, in compliance with the law, 
Attachment 1 to the Regulatory Flexibility Analysis is the small entity 
compliance guide for FY 2000.

IX. Backfit Analysis

    The NRC has determined that the backfit rule, 10 CFR 50.109, does 
not apply to this proposed rule and that a backfit analysis is not 
required for this proposed rule. The backfit analysis is not required 
because these proposed amendments do not require the modification of or 
additions to systems, structures, components, or the design of a 
facility or the design approval or manufacturing license for a facility 
or the procedures or organization required to design, construct or 
operate a facility.

List of Subjects

10 CFR Part 170

    Byproduct material, Import and export licenses, Intergovernmental 
relations, Non-payment penalties, Nuclear materials, Nuclear power 
plants and reactors, Source material, Special nuclear material.

10 CFR Part 171

    Annual charges, Byproduct material, Holders of certificates, 
registrations, approvals, Intergovernmental relations, Non-payment 
penalties, Nuclear materials, Nuclear power plants and reactors, Source 
material, Special nuclear material.

    For the reasons set out in the preamble and under the authority of 
the Atomic Energy Act of 1954, as amended, and 5 U.S.C. 553, the NRC is 
proposing to adopt the following amendments to 10 CFR Parts 170 and 
171.

PART 170--FEES FOR FACILITIES, MATERIALS, IMPORT AND EXPORT 
LICENSES, AND OTHER REGULATORY SERVICES UNDER THE ATOMIC ENERGY ACT 
OF 1954, AS AMENDED

    1. The authority citation for Part 170 continues to read as 
follows:

    Authority: 31 U.S.C. 9701, 96 Stat. 1051; sec. 301, Pub. L. 92-
314, 86 Stat. 222 (42 U.S.C. 2201w); sec. 201, Pub. L. 93-4381, 88 
Stat. 1242, as amended (42 U.S.C. 5841); sec. 205, Pub. L. 101-576, 
104 Stat. 2842, (31 U.S.C. 901).

    2. In Sec. 170.12, paragraph (c)(1) is revised to read as follows:


Sec. 170.12  Payment of Fees.

* * * * *
    (c) Inspection fees. (1) Inspection fees will be assessed to 
recover full cost for each resident inspector (including the senior 
resident inspector), assigned to a specific plant or facility. The fees 
assessed will be based on the number of hours that each inspector 
assigned to the plant or facility is in an official duty status (i.e., 
all time in a non-leave status), excluding time spent by a resident 
inspector in support of activities at another site. The hours will be 
billed at the appropriate hourly rate established in 10 CFR 170.20. 
Resident inspectors' time related to a specific inspection will be 
included in the fee assessed for the specific inspection in accordance 
with paragraph (c)(2) of this section.
* * * * *
    3. Section 170.20 is revised to read as follows:


Sec. 170.20  Average cost per professional staff-hour.

    Fees for permits, licenses, amendments, renewals, special projects, 
Part 55 requalification and replacement examinations and tests, other 
required reviews, approvals, and inspections under Secs. 170.21 and 
170.31 will be calculated using the following applicable professional 
staff-hour rates:

------------------------------------------------------------------------
                                                                Per hour
------------------------------------------------------------------------
Reactor Program (Sec.  170.21 Activities)....................       $144
Nuclear Materials and Nuclear Waste Program (Sec.  170.31            143
 Activities).................................................
------------------------------------------------------------------------

    4. In Sec. 170.21, the introductory text, Category K, and footnotes 
1 and 2 to the table are revised to read as follows:


Sec. 170.21  Schedule of fees for production and utilization 
facilities, review of standard referenced design approvals, special 
projects, inspections and import and export licenses.

    Applicants for construction permits, manufacturing licenses, 
operating licenses, import and export licenses, approvals of facility 
standard reference designs, requalification and replacement 
examinations for reactor operators, and special projects and holders of 
construction permits, licenses, and other approvals shall pay fees for 
the following categories of services.

                        Schedule of Facility Fees
                     [See footnotes at end of table]
------------------------------------------------------------------------
          Facility categories and type of fees               Fees 1 2
------------------------------------------------------------------------
 
*                  *                  *                  *
         *                  *                  *
K. Import and export licenses:
    Licenses for the import and export only of
     production and utilization facilities or the export
     only of components for production and utilization
     facilities issued under 10 CFR Part 110:
        1. Application for import or export of reactors
         and other facilities and exports of components
         which must be reviewed by the Commissioners and
         the Executive Branch, for example, actions
         under 10 CFR 110.40(b)
            Application-new license.....................          $9,300

[[Page 16258]]

 
            Amendment...................................           9,300
        2. Application for export of reactor and other
         components requiring Executive Branch review
         only, for example, those actions under 10 CFR
         110.41(a)(1)-(8)
            Application-new license.....................           5,700
            Amendment...................................           5,700
        3. Application for export of components
         requiring foreign government assurances only
            Application-new license.....................           1,700
            Amendment...................................           1,700
        4. Application for export of facility components
         and equipment not requiring Commissioner
         review, Executive Branch review, or foreign
         government assurances
            Application-new license.....................           1,100
            Amendment...................................           1,100
        5. Minor amendment of any export or import
         license to extend the expiration date, change
         domestic information, or make other revisions
         which do not require in-depth analysis or
         review
            Amendment...................................            210
------------------------------------------------------------------------
\1\ Fees will not be charged for orders issued by the Commission under
  Sec.  2.202 of this chapter or for amendments resulting specifically
  from the requirements of these types of Commission orders. Fees will
  be charged for approvals issued under a specific exemption provision
  of the Commission's regulations under Title 10 of the Code of Federal
  Regulations (e.g., Secs.  50.12, 73.5) and any other sections in
  effect now or in the future, regardless of whether the approval is in
  the form of a license amendment, letter of approval, safety evaluation
  report, or other form. Fees for licenses in this schedule that are
  initially issued for less than full power are based on review through
  the issuance of a full power license (generally full power is
  considered 100 percent of the facility's full rated power). Thus, if a
  licensee received a low power license or a temporary license for less
  than full power and subsequently receives full power authority (by way
  of license amendment or otherwise), the total costs for the license
  will be determined through that period when authority is granted for
  full power operation. If a situation arises in which the Commission
  determines that full operating power for a particular facility should
  be less than 100 percent of full rated power, the total costs for the
  license will be at that determined lower operating power level and not
  at the 100 percent capacity.
\2\ Full cost fees will be determined based on the professional staff
  time and appropriate contractual support services expended. For
  applications currently on file and for which fees are determined based
  on the full cost expended for the review, the professional staff hours
  expended for the review of the application up to the effective date of
  the final rule will be determined at the professional rates in effect
  at the time the service was provided. For those applications currently
  on file for which review costs have reached an applicable fee ceiling
  established by the June 20, 1984, and July 2, 1990, rules but are
  still pending completion of the review, the cost incurred after any
  applicable ceiling was reached through January 29, 1989, will not be
  billed to the applicant. Any professional staff-hours expended above
  those ceilings on or after January 30, 1989, will be assessed at the
  applicable rates established by Sec.  170.20, as appropriate, except
  for topical reports whose costs exceed $50,000. Costs which exceed
  $50,000 for any topical report, amendment, revision or supplement to a
  topical report completed or under review from January 30, 1989,
  through August 8, 1991, will not be billed to the applicant. Any
  professional hours expended on or after August 9, 1991, will be
  assessed at the applicable rate established in Sec.  170.20.

* * * * *
    5. Section 170.31 is revised to read as follows:


Sec. 170.31  Schedule of fees for materials licenses and other 
regulatory services, including inspections, and import and export 
licenses.

    Applicants for materials licenses, import and export licenses, and 
other regulatory services and holders of materials licenses, or import 
and export licenses shall pay fees for the following categories of 
services. This schedule includes fees for health and safety and 
safeguards inspections where applicable.

                       Schedule of Materials Fees
                     [See footnotes at end of table]
------------------------------------------------------------------------
Category of materials licenses and type of fees
                      \1\                              Fee \2\ \3\
------------------------------------------------------------------------
1. Special nuclear material:
    A. Licenses for possession and use of 200
     grams or more of plutonium in unsealed
     form or 350 grams or more of contained U-
     235 in unsealed form or 200 grams or more
     of U-233 in unsealed form. This includes
     applications to terminate licenses as well
     as licenses authorizing possession only:
        Licensing and Inspection...............  Full Cost.
    B. Licenses for receipt and storage of
     spent fuel at an independent spent fuel
     storage installation (ISFSI):
        Licensing and inspection...............  Full Cost.
    C. Licenses for possession and use of
     special nuclear material in sealed sources
     contained in devices used in industrial
     measuring systems, including x-ray
     fluorescence analyzers: \4\
        Application............................  $660.
    D. All other special nuclear material
     licenses, except licenses authorizing
     special nuclear material in unsealed form
     in combination that would constitute a
     critical quantity, as defined in Sec.
     150.11 of this chapter, for which the
     licensee shall pay the same fees as those
     for Category 1A: \4\
        Application............................  $1300.
    E. Licenses or certificates for
     construction and operation of a uranium
     enrichment facility
        Licensing and inspection...............  Full Cost.
2. Source material:

[[Page 16259]]

 
    A.(1) Licenses for possession and use of
     source material in recovery operations
     such as milling, in-situ leaching, heap-
     leaching, refining uranium mill
     concentrates to uranium hexafluoride, ore
     buying stations, ion exchange facilities
     and in processing of ores containing
     source material for extraction of metals
     other than uranium or thorium, including
     licenses authorizing the possession of
     byproduct waste material (tailings) from
     source material recovery operations, as
     well as licenses authorizing the
     possession and maintenance of a facility
     in a standby mode:
        Licensing and inspection...............  Full Cost.
    (2) Licenses that authorize the receipt of
     byproduct material, as defined in Section
     11e(2) of the Atomic Energy Act, from
     other persons for possession and disposal
     except those licenses subject to fees in
     Category 2.A.(1)
        Licensing and inspection...............  Full Cost.
    (3) Licenses that authorize the receipt of
     byproduct material, as defined in Section
     11e(2) of the Atomic Energy Act, from
     other persons for possession and disposal
     incidental to the disposal of the uranium
     waste tailings generated by the licensee's
     milling operations, except those licenses
     subject to the fees in Category 2.A.(1)
        Licensing and inspection...............  Full Cost.
    B. Licenses which authorize the possession,
     use, and/or installation of source
     material for shielding:
        Application............................  $160.
    C. All other source material licenses:
        Application............................  $5,600.
3. Byproduct material:
    A. Licenses of broad scope for the
     possession and use of byproduct material
     issued under Parts 30 and 33 of this
     chapter for processing or manufacturing of
     items containing byproduct material for
     commercial distribution:
        Application............................  $6,700.
    B. Other licenses for possession and use of
     byproduct material issued under Part 30 of
     this chapter for processing or
     manufacturing of items containing
     byproduct material for commercial
     distribution:
        Application............................  $2,500.
    C. Licenses issued under Secs.  32.72,
     32.73, and/or 32.74 of this chapter that
     authorize the processing or manufacturing
     and distribution or redistribution of
     radiopharmaceuticals, generators, reagent
     kits, and/or sources and devices
     containing byproduct material. This
     category does not apply to licenses issued
     to nonprofit educational institutions
     whose processing or manufacturing is
     exempt under 10 CFR 170.11(a)(4). These
     licenses are covered by fee Category 3D
        Application............................  $10,300.
    D. Licenses and approvals issued under
     Secs.  32.72, 32.73, and/or 32.74 of this
     chapter authorizing distribution or
     redistribution of radiopharmaceuticals,
     generators, reagent kits, and/or sources
     or devices not involving processing of
     byproduct material. This category includes
     licenses issued under Secs.  32.72, 32.73,
     and/or 32.74 of this chapter to nonprofit
     educational institutions whose processing
     or manufacturing is exempt under 10 CFR
     170.11(a)(4)
        Application............................  $2,400.
    E. Licenses for possession and use of
     byproduct material in sealed sources for
     irradiation of materials in which the
     source is not removed from its shield
     (self-shielded units):
        Application............................  $1,700.
    F. Licenses for possession and use of less
     than 10,000 curies of byproduct material
     in sealed sources for irradiation of
     materials in which the source is exposed
     for irradiation purposes. This category
     also includes underwater irradiators for
     irradiation of materials where the source
     is not exposed for irradiation purposes
        Application............................  $3,300.
    G. Licenses for possession and use of
     10,000 curies or more of byproduct
     material in sealed sources for irradiation
     of materials in which the source is
     exposed for irradiation purposes. This
     category also includes underwater
     irradiators for irradiation of materials
     where the source is not exposed for
     irradiation purposes
        Application............................  $3,500.
    H. Licenses issued under Subpart A of Part
     32 of this chapter to distribute items
     containing byproduct material that require
     device review to persons exempt from the
     licensing requirements of Part 30 of this
     chapter. The category does not include
     specific licenses authorizing
     redistribution of items that have been
     authorized for distribution to persons
     exempt from the licensing requirements of
     Part 30 of this chapter:
        Application............................  $2,100.
    I. Licenses issued under Subpart A of Part
     32 of this chapter to distribute items
     containing byproduct material or
     quantities of byproduct material that do
     not require device evaluation to persons
     exempt from the licensing requirements of
     Part 30 of this chapter. This category
     does not include specific licenses
     authorizing redistribution of items that
     have been authorized for distribution to
     persons exempt from the licensing
     requirements of Part 30 of this chapter:
        Application............................  $3,200.
    J. Licenses issued under Subpart B of Part
     32 of this chapter to distribute items
     containing byproduct material that require
     sealed source and/or device review to
     persons generally licensed under Part 31
     of this chapter. This category does not
     include specific licenses authorizing
     redistribution of items that have been
     authorized for distribution to persons
     generally licensed under Part 31 of this
     chapter:
        Application............................  $1,000.
    K. Licenses issued under Subpart B of Part
     32 of this chapter to distribute items
     containing byproduct material or
     quantities of byproduct material that do
     not require sealed source and/or device
     review to persons generally licensed under
     Part 31 of this chapter. This category
     does not include specific licenses
     authorizing redistribution of items that
     have been authorized for distribution to
     persons generally licensed under Part 31
     of this chapter:
        Application............................  $590.
    L. Licenses of broad scope for possession
     and use of byproduct material issued under
     Parts 30 and 33 of this chapter for
     research and development that do not
     authorize commercial distribution:
        Application............................  $5,600.

[[Page 16260]]

 
    M. Other licenses for possession and use of
     byproduct material issued under Part 30 of
     this chapter for research and development
     that do not authorize commercial
     distribution:
        Application............................  $2,300.
    N. Licenses that authorize services for
     other licensees, except:
        (1) Licenses that authorize only
         calibration and/or leak testing
         services are subject to the fees
         specified in fee Category 3P; and
        (2) Licenses that authorize waste
         disposal services are subject to the
         fees specified in fee Categories 4A,
         4B, and 4C:
        Application............................  $2,400.
    O. Licenses for possession and use of
     byproduct material issued under Part 34 of
     this chapter for industrial radiography
     operations:
        Application............................  $5,900.
    P. All other specific byproduct material
     licenses, except those in Categories 4A
     through 9D:
        Application............................  $1,300.
4. Waste disposal and processing:
    A. Licenses specifically authorizing the
     receipt of waste byproduct material,
     source material, or special nuclear
     material from other persons for the
     purpose of contingency storage or
     commercial land disposal by the licensee;
     or licenses authorizing contingency
     storage of low-level radioactive waste at
     the site of nuclear power reactors; or
     licenses for receipt of waste from other
     persons for incineration or other
     treatment, packaging of resulting waste
     and residues, and transfer of packages to
     another person authorized to receive or
     dispose of waste material:
        Licensing and inspection...............  Full Cost.
    B. Licenses specifically authorizing the
     receipt of waste byproduct material,
     source material, or special nuclear
     material from other persons for the
     purpose of packaging or repackaging the
     material. The licensee will dispose of the
     material by transfer to another person
     authorized to receive or dispose of the
     material:
        Application............................  $1,700.
    C. Licenses specifically authorizing the
     receipt of prepackaged waste byproduct
     material, source material, or special
     nuclear material from other persons. The
     licensee will dispose of the material by
     transfer to another person authorized to
     receive or dispose of the material:
        Application............................  $2,600.
5. Well logging:
    A. Licenses for possession and use of
     byproduct material, source material, and/
     or special nuclear material for well
     logging, well surveys, and tracer studies
     other than field flooding tracer studies:
        Application............................  $6,100.
    B. Licenses for possession and use of
     byproduct material for field flooding
     tracer studies:
        Licensing..............................  Full Cost.
6. Nuclear laundries:
    A. Licenses for commercial collection and
     laundry of items contaminated with
     byproduct material, source material, or
     special nuclear material:
        Application............................  $11,400.
7. Medical licenses:
    A. Licenses issued under Parts 30, 35, 40,
     and 70 of this chapter for human use of
     byproduct material, source material, or
     special nuclear material in sealed sources
     contained in teletherapy devices:
        Application............................  $6,200.
    B. Licenses of broad scope issued to
     medical institutions or two or more
     physicians under Parts 30, 33, 35, 40, and
     70 of this chapter authorizing research
     and development, including human use of
     byproduct material, except licenses for
     byproduct material, source material, or
     special nuclear material in sealed sources
     contained in teletherapy devices:
        Application............................  $4,500.
    C. Other licenses issued under Parts 30,
     35, 40, and 70 of this chapter for human
     use of byproduct material, source
     material, and/or special nuclear material,
     except licenses for byproduct material,
     source material, or special nuclear
     material in sealed sources contained in
     teletherapy devices:
        Application............................  $2,400.
8. Civil defense:
    A. Licenses for possession and use of
     byproduct material, source material, or
     special nuclear material for civil defense
     activities:
        Application............................  $330.
9. Device, product, or sealed source safety
 evaluation:
    A. Safety evaluation of devices or products
     containing byproduct material, source
     material, or special nuclear material,
     except reactor fuel devices, for
     commercial distribution:
        Application--each device...............  $5,300.
    B. Safety evaluation of devices or products
     containing byproduct material, source
     material, or special nuclear material
     manufactured in accordance with the unique
     specifications of, and for use by, a
     single applicant, except reactor fuel
     devices:
        Application--each device...............  $3,800.
    C. Safety evaluation of sealed sources
     containing byproduct material, source
     material, or special nuclear material,
     except reactor fuel, for commercial
     distribution:
        Application--each source...............  $1,600.
    D. Safety evaluation of sealed sources
     containing byproduct material, source
     material, or special nuclear material,
     manufactured in accordance with the unique
     specifications of, and for use by, a
     single applicant, except reactor fuel:
        Application--each source...............  $540.
10. Transportation of radioactive material:
    A. Evaluation of casks, packages, and
     shipping containers:
        Licensing and inspections..............  Full Cost.

[[Page 16261]]

 
    B. Evaluation of 10 CFR Part 71 quality
     assurance programs:
        Application............................  $400.
        Inspections............................  Full Cost.
11. Review of standardized spent fuel
 facilities:
        Licensing and inspection...............  Full Cost.
12. Special projects: \5\
        Approvals and preapplication/Licensing   Full Cost.
         activities.
        Inspections............................  Full Cost.
13. A. Spent fuel storage cask Certificate of
 Compliance:
        Licensing..............................  Full Cost.
    B. Inspections related to spent fuel
     storage cask Certificate of
        Compliance.............................  Full Cost.
    C. Inspections related to storage of spent   Full Cost.
     fuel under Sec.  72.210 of this chapter
14. Byproduct, source, or special nuclear
 material licenses and other approvals
 authorizing decommissioning, decontamination,
 reclamation, or site restoration activities
 under Parts 30, 40, 70, 72, and 76 of this
 chapter:
        Licensing and inspection...............  Full Cost.
15. Import and Export licenses:
    Licenses issued under 10 CFR Part 110 of
     this chapter for the import and export
     only of special nuclear material, source
     material, tritium and other byproduct
     material, heavy water, or nuclear grade
     graphite
        A. Application for export or import of
         high enriched uranium and other
         materials, including radioactive
         waste, which must be reviewed by the
         Commissioners and the Executive
         Branch, for example, those actions
         under 10 CFR 110.40(b). This category
         includes application for export or
         import of radioactive wastes in
         multiple forms from multiple
         generators or brokers in the exporting
         country and/or going to multiple
         treatment, storage or disposal
         facilities in one or more receiving
         countries
            Application--new license...........  $9,300.
            Amendment..........................  $9,300.
        B. Application for export or import of
         special nuclear material, source
         material, tritium and other byproduct
         material, heavy water, or nuclear
         grade graphite, including radioactive
         waste, requiring Executive Branch
         review but not Commissioner review.
         This category includes application for
         the export or import of radioactive
         waste involving a single form of waste
         from a single class of generator in
         the exporting country to a single
         treatment, storage and/or disposal
         facility in the receiving country
            Application--new license...........  $5,700.
            Amendment..........................  $5,700.
        C. Application for export of routine
         reloads of low enriched uranium
         reactor fuel and exports of source
         material requiring only foreign
         government assurances under the Atomic
         Energy Act
            Application--new license...........  $1,700.
            Amendment..........................  $1,700.
        D. Application for export or import of
         other materials, including radioactive
         waste, not requiring Commissioner
         review, Executive Branch review, or
         foreign government assurances under
         the Atomic Energy Act. This category
         includes application for export or
         import of radioactive waste where the
         NRC has previously authorized the
         export or import of the same form of
         waste to or from the same or similar
         parties, requiring only confirmation
         from the receiving facility and
         licensing authorities that the
         shipments may proceed according to
         previously agreed understandings and
         procedures
            Application-new license............  $1,100.
            Amendment..........................  $1,100.
        E. Minor amendment of any export or
         import license to extend the
         expiration date, change domestic
         information, or make other revisions
         which do not require in-depth
         analysis, review, or consultations
         with other agencies or foreign
         governments
            Amendment..........................  $210.
16. Reciprocity:
    Agreement State licensees who conduct
     activities under the reciprocity
     provisions of 10 CFR 150.20
        Application (initial filing of Form      $1,200.
         241).
        Revisions..............................  $200.
------------------------------------------------------------------------
\1\ Types of fees--Separate charges, as shown in the schedule, will be
  assessed for preapplication consultations and reviews and applications
  for new licenses and approvals, issuance of new licenses and
  approvals, certain amendments and renewals to existing licenses and
  approvals, safety evaluations of sealed sources and devices, and
  certain inspections. The following guidelines apply to these charges:
(a) Application fees. Applications for new materials licenses and export
  and import licenses; applications to reinstate expired, terminated, or
  inactive licenses except those subject to fees assessed at full costs;
  applications filed by Agreement State licensees to register under the
  general license provisions of 10 CFR 150.20; and applications for
  amendments to materials licenses that would place the license in a
  higher fee category or add a new fee category must be accompanied by
  the prescribed application fee for each category.
(1) Applications for licenses covering more than one fee category of
  special nuclear material or source material must be accompanied by the
  prescribed application fee for the highest fee category.
(2) Applications for new licenses that cover both byproduct material and
  special nuclear material in sealed sources for use in gauging devices
  will pay the appropriate application fee for fee Category 1C only.
(b) Licensing fees. Fees for reviews of applications for new licenses
  and for renewals and amendments to existing licenses, for
  preapplication consultations and for reviews of other documents
  submitted to NRC for review, and for project manager time for fee
  categories subject to full cost fees (fee Categories 1A, 1B, 1E, 2A,
  4A, 5B, 10A, 11, 12, 13A, and 14) are due upon notification by the
  Commission in accordance with Sec.  170.12(b).
(c) Amendment/revision fees.
Applications for amendments to export and import licenses and revisions
  to reciprocity initial applications must be accompanied by the
  prescribed amendment/revision fee for each license/revision affected.
  An application for an amendment to a license or approval classified in
  more than one fee category must be accompanied by the prescribed
  amendment fee for the category affected by the amendment unless the
  amendment is applicable to two or more fee categories in which case
  the amendment fee for the highest fee category would apply.

[[Page 16262]]

 
(d) Inspection fees. Inspections resulting from investigations conducted
  by the Office of Investigations and nonroutine inspections that result
  from third-party allegations are not subject to fees. Inspection fees
  are due upon notification by the Commission in accordance with Sec.
  170.12(c).
\2\ Fees will not be charged for orders issued by the Commission under
  10 CFR 2.202 or for amendments resulting specifically from the
  requirements of these types of Commission orders. However, fees will
  be charged for approvals issued under a specific exemption provision
  of the Commission's regulations under Title 10 of the Code of Federal
  Regulations (e.g., 10 CFR 30.11, 40.14, 70.14, 73.5, and any other
  sections in effect now in the future) regardless of whether the
  approval is in the form of a license amendment, letter of approval,
  safety evaluation report, or other form. In addition to the fee shown,
  an applicant may be assessed an additional fee for sealed source and
  device evaluations as shown in Categories 9A through 9D.
\3\ Full cost fees will be determined based on the professional staff
  time multiplied by the appropriate professional hourly rate
  established in Sec.  170.20 in effect at the time the service is
  provided, and the appropriate contractual support services expended.
  For applications currently on file for which review costs have reached
  an applicable fee ceiling established by the June 20, 1984, and July
  2, 1990, rules, but are still pending completion of the review, the
  cost incurred after any applicable ceiling was reached through January
  29, 1989, will not be billed to the applicant. Any professional staff-
  hours expended above those ceilings on or after January 30, 1989, will
  be assessed at the applicable rates established by Sec.  170.20, as
  appropriate, except for topical reports whose costs exceed $50,000.
  Costs which exceed $50,000 for each topical report, amendment,
  revision, or supplement to a topical report completed or under review
  from January 30, 1989, through August 8, 1991, will not be billed to
  the applicant. Any professional hours expended on or after August 9,
  1991, will be assessed at the applicable rate established in Sec.
  170.20.
\4\ Licensees paying fees under Categories 1A, 1B, and 1E are not
  subject to fees under Categories 1C and 1D for sealed sources
  authorized in the same license except for an application that deals
  only with the sealed sources authorized by the license.
\5\ Fees will not be assessed for requests/reports submitted to the NRC:
 
(a) In response to a Generic Letter or NRC Bulletin that does not result
  in an amendment to the license, does not result in the review of an
  alternate method or reanalysis to meet the requirements of the Generic
  Letter, or does not involve an unreviewed safety issue;
(b) In response to an NRC request (at the Associate Office Director
  level or above) to resolve an identified safety, safeguards, or
  environmental issue, or to assist NRC in developing a rule, regulatory
  guide, policy statement, generic letter, or bulletin; or
(c) As a means of exchanging information between industry organizations
  and the NRC for the purpose of supporting generic regulatory
  improvements or efforts.

PART 171--ANNUAL FEES FOR REACTOR LICENSES AND FUEL CYCLE LICENSES 
AND MATERIAL LICENSES, INCLUDING HOLDERS OF CERTIFICATES OF 
COMPLIANCE, REGISTRATIONS, AND QUALITY ASSURANCE PROGRAM APPROVALS 
AND GOVERNMENT AGENCIES LICENSED BY THE NRC

    6. The authority citation for Part 171 continues to read as 
follows:

    Authority: Sec. 7601, Pub. L. 99-272, 100 Stat. 146, as amended 
by sec. 5601, Pub. L. 100-203, 101 Stat. 1330, as amended by Sec. 
3201, Pub. L. 101-239, 103 Stat. 2106 as amended by sec. 6101, Pub. 
L. 101-508, 104 Stat. 1388, (42 U.S.C. 2213); sec. 301, Pub. L. 92-
314, 86 Stat. 222 (42 U.S.C. 2201(w)); sec. 201, 88 Stat. 1242, as 
amended (42 U.S.C. 5841); sec. 2903, Pub. L. 102-486, 106 Stat. 
3125, (42 U.S.C. 2214 note).

    7. In Section Sec. 171.5, the definition of the term Materials 
License is revised to read as follows:


Sec. 171.5  Definitions.

* * * * *
    Materials License means a license, certificate, approval, 
registration or other form of permission issued by the NRC under the 
regulations in 10 CFR parts 30, 32 through 36, 39, 40, 61, 70, 71, 72, 
and 76.
* * * * *
    8. In Sec. 171.15, paragraphs (b), (c), (d)(1), and (e) are revised 
to read as follows:


Sec. 171.15  Annual Fees: Reactor licenses and spent fuel storage/
reactor decommissioning.

* * * * *
    (b)(1) The FY 2000 annual fee for each operating power reactor 
which must be collected by September 30, 2000, is $2,815,000. This fee 
has been determined by adjusting the FY 1999 actual (prior to rounding) 
annual fee upward by approximately 1.4 percent.
    (2) The FY 1999 annual fee was comprised of a base operating power 
reactor annual fee, a base spent fuel storage/reactor decommissioning 
annual fee, and associated additional charges (surcharges). The 
activities comprising the FY 1999 spent storage/reactor decommissioning 
base annual fee are shown in paragraph (c)(2)(i) and (ii) of this 
section. The activities comprising the FY 1999 surcharge are shown in 
paragraph (d)(1) of this section. The activities comprising the FY 1999 
base annual fee for operating power reactors are as follows:
    (i) Power reactor safety and safeguards regulation except licensing 
and inspection activities recovered under Part 170 of this chapter and 
generic reactor decommissioning activities.
    (ii) Research activities directly related to the regulation of 
power reactors except those activities specifically related to reactor 
decommissioning.
    (iii) Generic activities required largely for NRC to regulate power 
reactors, e.g., updating Part 50 of this chapter, or operating the 
Incident Response Center. The base annual fee for operating power 
reactors does not include generic activities specifically related to 
reactor decommissioning.
    (c)(1) The FY 2000 annual fee for each power reactor holding a Part 
50 license that is in a decommissioning or possession only status and 
has spent fuel on-site and each independent spent fuel storage Part 72 
licensee who does not hold a Part 50 license is $209,000. This fee has 
been determined by increasing the FY 1999 actual (prior to rounding) 
annual fee by approximately 1.4 percent.
    (2) The FY 1999 annual fee was comprised of a base spent fuel 
storage/reactor decommissioning annual fee (which is also included in 
the operating power reactor annual fee shown in paragraph (b) of this 
section), and an additional charge (surcharge). The activities 
comprising the FY 1999 surcharge are shown in paragraph (d)(1) of this 
section. The activities comprising the FY 1999 spent fuel storage/
reactor decommissioning base annual fee are:
    (i) Generic and other research activities directly related to 
reactor decommissioning and spent fuel storage; and
    (ii) Other safety, environmental, and safeguards activities related 
to reactor decommissioning and spent fuel storage, except costs for 
licensing and inspection activities that are recovered under part 170 
of this chapter.
    (d)(1) The activities comprising the FY 1999 surcharge are as 
follows:
    (i) Low level waste disposal generic activities;
    (ii) Activities not attributable to an existing NRC licensee or 
class of licensees (e.g., international cooperative safety program and 
international safeguards activities, support for the Agreement State 
program, and site decommissioning management plan (SDMP) activities); 
and
    (iii) Activities not currently subject to 10 CFR Part 170 licensing 
and inspection fees based on existing law or Commission policy, e.g., 
reviews and inspections conducted of nonprofit educational 
institutions, licensing actions for Federal agencies, and costs that 
would not be collected from small entities based on Commission policy 
in accordance with the Regulatory Flexibility Act.
* * * * *
    (e) The FY 2000 annual fees for licensees authorized to operate a 
nonpower (test and research) reactor

[[Page 16263]]

licensed under Part 50 of this chapter have been determined by revising 
the FY 1999 actual (prior to rounding) annual fee upward by 
approximately 1.4 percent. The FY 2000 annual fee for each nonpower 
reactor, unless the reactor is exempted from fees under Sec. 171.11(a), 
is as follows:

Research reactor: $87,100
Test reactor: $87,100

    9. In Sec. 171.16, paragraphs (c), (d), and (e) are revised to read 
as follows:


Sec. 171.16  Annual Fees: Materials Licensees, Holders of Certificates 
of Compliance, Holders of Sealed Source and Device Registrations, 
Holders of Quality Assurance Program Approvals and Government Agencies 
Licensed by the NRC.

* * * * *
    (c) A licensee who is required to pay an annual fee under this 
section may qualify as a small entity. If a licensee qualifies as a 
small entity and provides the Commission with the proper certification 
with the annual fee payment, the licensee may pay reduced annual fees 
as shown below. Failure to file a small entity certification in a 
timely manner could result in the denial of any refund that might 
otherwise be due.

------------------------------------------------------------------------
                                                              Maximum
                                                            annual fee
                                                           per licensed
                                                             category
------------------------------------------------------------------------
Small Businesses Not Engaged in Manufacturing and Small
 Not-For-Profit Organizations (Gross Annual Receipts):
    $350,000 to $5 million..............................          $2,300
    Less than $350,000..................................             500
Manufacturing entities that have an average of 500
 employees or less:
    35 to 500 employees.................................           2,300
    Less than 35 employees..............................             500
Small Governmental Jurisdictions (Including publicly
 supported educational institutions) (Population):
    20,000 to 50,000....................................           2,300
    Less than 20,000....................................             500
Educational Institutions that are not State or Publicly
 Supported, and have 500 Employees or Less:
    35 to 500 employees.................................           2,300
    Less than 35 employees..............................             500
------------------------------------------------------------------------

    (1) A licensee qualifies as a small entity if it meets the size 
standards established by the NRC (See 10 CFR 2.810).
    (2) A licensee who seeks to establish status as a small entity for 
the purpose of paying the annual fees required under this section must 
file a certification statement with the NRC. The licensee must file the 
required certification on NRC Form 526 for each license under which it 
is billed. The NRC will include a copy of NRC Form 526 with each annual 
fee invoice sent to a licensee. A licensee who seeks to qualify as a 
small entity must submit the completed NRC Form 526 with the reduced 
annual fee payment.
    (3) For purposes of this section, the licensee must submit a new 
certification with its annual fee payment each year.
    (4) The maximum annual fee a small entity is required to pay is 
$2,300 for each category applicable to the license(s).
    (d) The FY 2000 annual fees for materials licensees and holders of 
certificates, registrations or approvals subject to fees under this 
section are shown below. The FY 2000 annual fees, which must be 
collected by September 30, 2000, have been determined by adjusting the 
FY 1999 actual (prior to rounding) annual fees upward by approximately 
1.4 percent. As a result of rounding, the FY 2000 annual fee for 
several fee cateogries is the same as the FY 1999 annual fee. In the FY 
1999 final rule, the NRC stated it would stabilize annual fees by 
adjusting the annual fees only by the percentage change (plus or minus) 
in NRC's total budget authority and adjustments based on changes in 10 
CFR Part 170 fees, the number of licensees paying the fees, and other 
required adjustments. The FY 1999 annual fees were comprised of a base 
annual fee and an additional charge (surcharge). The activities 
comprising the FY 1999 surcharge are shown for convenience in paragraph 
(e) of this section.

   Schedule of Materials Annual Fees and Fees for Government Agencies
                             Licensed by NRC
                     [See footnotes at end of table]
------------------------------------------------------------------------
             Category of materials licenses                Annual fees 1
----------------------------------------------------------------2 3-----
1. Special nuclear material:
    A. (1) Licenses for possession and use of U-235 or
     plutonium for fuel fabrication activities.
        (a) Strategic Special Nuclear Material:
            Babcock & Wilcox SNM-42.....................      $3,327,000
            Nuclear Fuel Services SNM-124...............       3,327,000
        (b) Low Enriched Uranium in Dispersible Form
         Used for Fabrication of Power Reactor Fuel:
            Combustion Engineering (Hematite) SNM-33....       1,116,000
            General Electric Company SNM-1097...........       1,116,000
            Siemens Nuclear Power SNM-1227..............       1,116,000
            Westinghouse Electric Company SNM-1107......       1,116,000
    (2) All other special nuclear materials licenses not
     included in Category 1.A.(1) which are licensed for
     fuel cycle activities
        (a) Facilities with limited operations:
            Framatome Cogema SNM-1168...................         438,000
        (b) All Others:
            General Electric SNM-960....................         319,000

[[Page 16264]]

 
    B. Licenses for receipt and storage of spent fuel at
     an independent spent fuel storage installation
     (ISFSI). See 10 CFR 171.15(c).
    C. Licenses for possession and use of special                  1,200
     nuclear material in sealed sources contained in
     devices used in industrial measuring systems,
     including x-ray fluorescence analyzers.............
    D. All other special nuclear material licenses,                3,400
     except licenses authorizing special nuclear
     material in unsealed form in combination that would
     constitute a critical quantity, as defined in Sec.
     150.11 of this chapter, for which the licensee
     shall pay the same fees as those for Category
     1.A.(2)............................................
    E. Licenses or certificates for the operation of a         2,072,000
     uranium enrichment facility........................
2. Source material:
    A.(1) Licenses for possession and use of source              478,000
     material for refining uranium mill concentrates to
     uranium hexafluoride...............................
    (2) Licenses for possession and use of source
     material in recovery operations such as milling, in-
     situ leaching, heap-leaching, ore buying stations,
     ion exchange facilities and in processing of ores
     containing source material for extraction of metals
     other than uranium or thorium, including licenses
     authorizing the possession of byproduct waste
     material (tailings) from source material recovery
     operations, as well as licenses authorizing the
     possession and maintenance of a facility in a
     standby mode.......................................
        Class I facilities 4............................         132,000
        Class II facilities 4...........................         111,000
        Other facilities 4..............................          30,800
    (3) Licenses that authorize the receipt of byproduct          81,700
     material, as defined in Section 11e.(2) of the
     Atomic Energy Act, from other persons for
     possession and disposal, except those licenses
     subject to the fees in Category 2.A.(2) or Category
     2.A.(4)............................................
    (4) Licenses that authorize the receipt of byproduct          12,900
     material, as defined in Section 11e.(2) of the
     Atomic Energy Act, from other persons for
     possession and disposal incidental to the disposal
     of the uranium waste tailings generated by the
     licensee's milling operations, except those
     licenses subject to the fees in Category 2.A.(2)...
    B. Licenses that authorize only the possession, use              630
     and/or installation of source material for
     shielding..........................................
    C. All other source material licenses...............          11,800
3. Byproduct material:
    A. Licenses of broad scope for possession and use of          26,300
     byproduct material issued under Parts 30 and 33 of
     this chapter for processing or manufacturing of
     items containing byproduct material for commercial
     distribution.......................................
    B. Other licenses for possession and use of                    6,400
     byproduct material issued under Part 30 of this
     chapter for processing or manufacturing of items
     containing byproduct material for commercial
     distribution.......................................
    C. Licenses issued under Secs.  32.72, 32.73, and/or          15,600
     32.74 of this chapter authorizing the processing or
     manufacturing and distribution or redistribution of
     radiopharmaceuticals, generators, reagent kits and/
     or sources and devices containing byproduct
     material. This category also includes the
     possession and use of source material for shielding
     authorized under Part 40 of this chapter when
     included on the same license. This category does
     not apply to licenses issued to nonprofit
     educational institutions whose processing or
     manufacturing is exempt under 10 CFR 171.11(a)(1).
     These licenses are covered by fee Category 3D......
    D. Licenses and approvals issued under Secs.  32.72,           3,800
     32.73, and/or 32.74 of this chapter authorizing
     distribution or redistribution of
     radiopharmaceuticals, generators, reagent kits and/
     or sources or devices not involving processing of
     byproduct material. This category includes licenses
     issued under Secs.  32.72, 32.73 and 32.74 of this
     chapter to nonprofit educational institutions whose
     processing or manufacturing is exempt under 10 CFR
     171.11(a)(1). This category also includes the
     possession and use of source material for shielding
     authorized under Part 40 of this chapter when
     included on the same license.......................
    E. Licenses for possession and use of byproduct                3,500
     material in sealed sources for irradiation of
     materials in which the source is not removed from
     its shield (self-shielded units)...................
    F. Licenses for possession and use of less than                5,800
     10,000 curies of byproduct material in sealed
     sources for irradiation of materials in which the
     source is exposed for irradiation purposes. This
     category also includes underwater irradiators for
     irradiation of materials in which the source is not
     exposed for irradiation purposes...................
    G. Licenses for possession and use of 10,000 curies           15,000
     or more of byproduct material in sealed sources for
     irradiation of materials in which the source is
     exposed for irradiation purposes. This category
     also includes underwater irradiators for
     irradiation of materials in which the source is not
     exposed for irradiation purposes...................
    H. Licenses issued under Subpart A of Part 32 of               3,300
     this chapter to distribute items containing
     byproduct material that require device review to
     persons exempt from the licensing requirements of
     Part 30 of this chapter, except specific licenses
     authorizing redistribution of items that have been
     authorized for distribution to persons exempt from
     the licensing requirements of Part 30 of this
     chapter............................................
    I. Licenses issued under Subpart A of Part 32 of               4,700
     this chapter to distribute items containing
     byproduct material or quantities of byproduct
     material that do not require device evaluation to
     persons exempt from the licensing requirements of
     Part 30 of this chapter, except for specific
     licenses authorizing redistribution of items that
     have been authorized for distribution to persons
     exempt from the licensing requirements of Part 30
     of this chapter....................................
    J. Licenses issued under Subpart B of Part 32 of               2,100
     this chapter to distribute items containing
     byproduct material that require sealed source and/
     or device review to persons generally licensed
     under Part 31 of this chapter, except specific
     licenses authorizing redistribution of items that
     have been authorized for distribution to persons
     generally licensed under Part 31 of this chapter...
    K. Licenses issued under Subpart B of Part 31 of               1,800
     this chapter to distribute items containing
     byproduct material or quantities of byproduct
     material that do not require sealed source and/or
     device review to persons generally licensed under
     Part 31 of this chapter, except specific licenses
     authorizing redistribution of items that have been
     authorized for distribution to persons generally
     licensed under Part 31 of this chapter.............
    L. Licenses of broad scope for possession and use of          11,300
     byproduct material issued under Parts 30 and 33 of
     this chapter for research and development that do
     not authorize commercial distribution..............

[[Page 16265]]

 
    M. Other licenses for possession and use of                    5,000
     byproduct material issued under Part 30 of this
     chapter for research and development that do not
     authorize commercial distribution..................
    N. Licenses that authorize services for other
     licensees, except:
        (1) Licenses that authorize only calibration and/
         or leak testing services are subject to the
         fees specified in fee Category 3P; and
        (2) Licenses that authorize waste disposal                 5,300
         services are subject to the fees specified in
         fee Categories 4A, 4B, and 4C
    O. Licenses for possession and use of byproduct               14,900
     material issued under Part 34 of this chapter for
     industrial radiography operations. This category
     also includes the possession and use of source
     material for shielding authorized under Part 40 of
     this chapter when authorized on the same license...
    P. All other specific byproduct material licenses,             2,600
     except those in Categories 4A through 9D...........
4. Waste disposal and processing:
    A. Licenses specifically authorizing the receipt of          \5\ N/A
     waste byproduct material, source material, or
     special nuclear material from other persons for the
     purpose of contingency storage or commercial land
     disposal by the licensee; or licenses authorizing
     contingency storage of low-level radioactive waste
     at the site of nuclear power reactors; or licenses
     for receipt of waste from other persons for
     incineration or other treatment, packaging of
     resulting waste and residues, and transfer of
     packages to another person authorized to receive or
     dispose of waste material..........................
    B. Licenses specifically authorizing the receipt of           11,500
     waste byproduct material, source material, or
     special nuclear material from other persons for the
     purpose of packaging or repackaging the material.
     The licensee will dispose of the material by
     transfer to another person authorized to receive or
     dispose of the material............................
    C. Licenses specifically authorizing the receipt of            8,500
     prepackaged waste byproduct material, source
     material, or special nuclear material from other
     persons. The licensee will dispose of the material
     by transfer to another person authorized to receive
     or dispose of the material.........................
5. Well logging:
    A. Licenses for possession and use of byproduct               10,100
     material, source material, and/or special nuclear
     material for well logging, well surveys, and tracer
     studies other than field flooding tracer studies...
    B. Licenses for possession and use of byproduct              \5\ N/A
     material for field flooding tracer studies.........
6. Nuclear laundries:
    A. Licenses for commercial collection and laundry of          19,200
     items contaminated with byproduct material, source
     material, or special nuclear material..............
7. Medical licenses:
    A. Licenses issued under Parts 30, 35, 40, and 70 of          15,500
     this chapter for human use of byproduct material,
     source material, or special nuclear material in
     sealed sources contained in teletherapy devices.
     This category also includes the possession and use
     of source material for shielding when authorized on
     the same license...................................
    B. Licenses of broad scope issued to medical                  28,100
     institutions or two or more physicians under Parts
     30, 33, 35, 40, and 70 of this chapter authorizing
     research and development, including human use of
     byproduct material except licenses for byproduct
     material, source material, or special nuclear
     material in sealed sources contained in teletherapy
     devices. This category also includes the possession
     and use of source material for shielding when
     authorized on the same license \9\.................
    C. Other licenses issued under Parts 30, 35, 40, and           5,900
     70 of this chapter for human use of byproduct
     material, source material, and/or special nuclear
     material except licenses for byproduct material,
     source material, or special nuclear material in
     sealed sources contained in teletherapy devices.
     This category also includes the possession and use
     of source material for shielding when authorized on
     the same license \9\...............................
8. Civil defense:
    A. Licenses for possession and use of byproduct                1,200
     material, source material, or special nuclear
     material for civil defense activities..............
9. Device, product, or sealed source safety evaluation:
    A. Registrations issued for the safety evaluation of           6,100
     devices or products containing byproduct material,
     source material, or special nuclear material,
     except reactor fuel devices, for commercial
     distribution.......................................
    B. Registrations issued for the safety evaluation of           4,400
     devices or products containing byproduct material,
     source material, or special nuclear material
     manufactured in accordance with the unique
     specifications of, and for use by, a single
     applicant, except reactor fuel devices.............
    C. Registrations issued for the safety evaluation of           1,900
     sealed sources containing byproduct material,
     source material, or special nuclear material,
     except reactor fuel, for commercial distribution...
    D. Registrations issued for the safety evaluation of             620
     sealed sources containing byproduct material,
     source material, or special nuclear material,
     manufactured in accordance with the unique
     specifications of, and for use by, a single
     applicant, except reactor fuel.....................
10. Transportation of radioactive material:
    A. Certificates of Compliance or other package
     approvals issued for design of casks, packages, and
     shipping containers.
        Spent Fuel, High-Level Waste, and plutonium air          \6\ N/A
         packages.......................................
        Other Casks.....................................         \6\ N/A
    B. Quality assurance program approvals issued under
     10 CFR Part 71
Users and Fabricators...................................          67,600
Users...................................................           2,300
11. Standardized spent fuel facilities..................         \6\ N/A
12. Special Projects....................................         \6\ N/A
13. A. Spent fuel storage cask Certificate of Compliance         \6\ N/A
    B. General licenses for storage of spent fuel under
     10 CFR 72.210. N/A (See 10 CFR 171.15(c)).
14. Byproduct, source, or special nuclear material               \7\ N/A
 licenses and other approvals authorizing
 decommissioning, decontamination, reclamation, or site
 restoration activities under 10 CFR Parts 30, 40, 70,
 72, and 76 of this chapter.............................
15. Import and Export licenses..........................         \8\ N/A
16. Reciprocity.........................................         \8\ N/A

[[Page 16266]]

 
17. Master materials licenses of broad scope issued to           363,000
 Government agencies....................................
18. Department of Energy:
    A. Certificates of Compliance.......................    \10\ 884,000
    B. Uranium Mill Tailing Radiation Control Act               881,000
     (UMTRCA) activities................................
------------------------------------------------------------------------
\1\ Annual fees will be assessed based on whether a licensee held a
  valid license with the NRC authorizing possession and use of
  radioactive material during the fiscal year. However, the annual fee
  is waived for those materials licenses and holders of certificates,
  registrations, and approvals who either filed for termination of their
  licenses or approvals or filed for possession only/storage licenses
  prior to October 1, 1999, and permanently ceased licensed activities
  entirely by September 30, 1999. Annual fees for licensees who filed
  for termination of a license, downgrade of a license, or for a
  possession only license during the fiscal year and for new licenses
  issued during the fiscal year will be prorated in accordance with the
  provisions of Sec.  171.17. If a person holds more than one license,
  certificate, registration, or approval, the annual fee(s) will be
  assessed for each license, certificate, registration, or approval held
  by that person. For licenses that authorize more than one activity on
  a single license (e.g., human use and irradiator activities), annual
  fees will be assessed for each category applicable to the license.
  Licensees paying annual fees under Category 1A(1) are not subject to
  the annual fees for Category 1C and 1D for sealed sources authorized
  in the license.
\2\ Payment of the prescribed annual fee does not automatically renew
  the license, certificate, registration, or approval for which the fee
  is paid. Renewal applications must be filed in accordance with the
  requirements of Parts 30, 40, 70, 71, 72, or 76 of this chapter.
\3\ Each fiscal year, fees for these materials licenses will be
  calculated and assessed in accordance with Sec.  171.13 and will be
  published in the Federal Register for notice and comment.
\4\ A Class I license includes mill licenses issued for the extraction
  of uranium from uranium ore. A Class II license includes solution
  mining licenses (in-situ and heap leach) issued for the extraction of
  uranium from uranium ores including research and development licenses.
  An ``other'' license includes licenses for extraction of metals, heavy
  metals, and rare earths.
\5\ There are no existing NRC licenses in these fee categories. Once NRC
  issues a license for these categories, the Commission will consider
  establishing an annual fee for that type of license.
\6\ Standardized spent fuel facilities, 10 CFR Parts 71 and 72
  Certificates of Compliance, and special reviews, such as topical
  reports, are not assessed an annual fee because the generic costs of
  regulating these activities are primarily attributable to the users of
  the designs, certificates, and topical reports.
\7\ Licensees in this category are not assessed an annual fee because
  they are charged an annual fee in other categories while they are
  licensed to operate.
\8\ No annual fee is charged because it is not practical to administer
  due to the relatively short life or temporary nature of the license.
\9\ Separate annual fees will not be assessed for pacemaker licenses
  issued to medical institutions who also hold nuclear medicine licenses
  under Categories 7B or 7C.
\10\ This includes Certificates of Compliance issued to DOE that are not
  under the Nuclear Waste Fund.

    (e) The activities comprising the surcharge are as follows:
    (1) LLW disposal generic activities;
    (2) Activities not directly attributable to an existing NRC 
licensee or classes of licensees; e.g., international cooperative 
safety program and international safeguards activities; support for the 
Agreement State program; site decommissioning management plan (SDMP) 
activities; and
    (3) Activities not currently assessed licensing and inspection fees 
under 10 CFR Part 170 based on existing law or Commission policy, e.g., 
reviews and inspections conducted of nonprofit educational institutions 
and reviews for Federal agencies; activities related to decommissioning 
and reclamation; and costs that would not be collected from small 
entities based on Commission policy in accordance with the Regulatory 
Flexibility Act.
    10. Section 171.19 is revised to read as follows:


Sec. 171.19  Payment.

    (a) Method of payment. Annual fee payments, made payable to the 
U.S. Nuclear Regulatory Commission, are to be made in U.S. funds by 
electronic funds transfer such as ACH (Automated Clearing House) using 
EDI (Electronic Data Interchange), check, draft, money order, or credit 
card. Federal agencies may also make payment by the On-line Payment and 
Collection System (OPAC's). Where specific payment instructions are 
provided on the invoices to applicants and licensees, payment should be 
made accordingly, e.g. invoices of $5,000 or more should be paid via 
ACH through NRC's Lockbox Bank at the address indicated on the invoice. 
Credit card payments should be made up to the limit established by the 
credit card bank, in accordance with specific instructions provided 
with the invoices, to the Lockbox Bank designated for credit card 
payments. In accordance with Department of the Treasury requirements, 
refunds will only be made upon receipt of information on the payee's 
financial institution and bank accounts.
    (b) Annual fees in the amount of $100,000 or more and described in 
the Federal Register document issued under Sec. 171.13 must be paid in 
quarterly installments of 25 percent as billed by the NRC. The quarters 
begin on October 1, January 1, April 1, and July 1 of each fiscal year. 
The NRC will adjust the fourth quarterly invoice to recover the full 
amount of the revised annual fee. If the amounts collected in the first 
three quarters exceed the amount of the revised annual fee, the 
overpayment will be refunded. Licensees whose annual fee for FY 1999 
was less than $100,000 (billed on the anniversary date of the license), 
and whose revised annual fee for FY 2000 would be $100,000 (subject to 
quarterly billing), would be issued a bill upon publication of the 
final rule for the full amount of the FY 2000 annual fee, less any 
payments received for FY 2000 based on the anniversary date billing 
process.
    (c) Annual fees that are less than $100,000 are billed on the 
anniversary date of the license. For annual fee purposes, the 
anniversary date of the license is considered to be the first day of 
the month in which the original license was issued by the NRC. 
Licensees that are billed on the license anniversary date will be 
assessed the annual fee in effect on the anniversary date of the 
license. Materials licenses subject to the annual fee that are 
terminated during the fiscal year but before the anniversary month of 
the license will be billed upon termination for the fee in effect at 
the time of the billing. New materials licenses subject to the annual 
fee will be billed in the month the license is issued or in the next 
available monthly billing for the fee in effect on the anniversary date 
of the license. Thereafter, annual fees for new licenses will be 
assessed in the anniversary month of the license.

[[Page 16267]]

    (d) Annual fees of less than $100,000 must be paid as billed by the 
NRC. Materials license annual fees that are less than $100,000 are 
billed on the anniversary date of the license. The materials licensees 
that are billed on the anniversary date of the license are those 
covered by fee categories 1C, 1.D, 2(A)(2) other, 2A(3), 2A(4), 2B, 2C, 
3A through 3P, 4B through 9D, 10A, and 10B.
    (e) Payment is due on the invoice date and interest accrues from 
the date of the invoice. However, interest will be waived if payment is 
received within 30 days from the invoice date.

    Dated at Rockville, Maryland, this 14th day of March, 2000.

    For the Nuclear Regulatory Commission.
Jesse L. Funches,
Chief Financial Officer.


    Note: This Appendix Will Not Appear in the Code of Federal 
Regulations.

Appendix A to This Proposed Rule--Draft Regulatory Flexibility Analysis 
for the Amendments to 10 CFR Part 170 (License Fees) and 10 CFR Part 
171 (Annual Fees)

I. Background

    The Regulatory Flexibility Act (RFA), as amended, (5 U.S.C. 601 
et seq.) requires that agencies consider the impact of their 
rulemakings on small entities and, consistent with applicable 
statutes, consider alternatives to minimize these impacts on the 
businesses, organizations, and government jurisdictions to which 
they apply.
    The NRC has established standards for determining which NRC 
licensees qualify as small entities (10 CFR 2.801). These size 
standards reflect the Small Business Administration's most common 
receipts-based size standards and include a size standard for 
business concerns that are manufacturing entities. The NRC uses the 
size standards to reduce the impact of annual fees on small entities 
by establishing a licensee's eligibility to qualify for a maximum 
small entity fee. The small entity fee categories in Sec. 171.16(c) 
of this proposed rule are based on the NRC's size standards.
    The Omnibus Budget Reconciliation Act (OBRA-90), as amended, 
requires that the NRC recover approximately 100 percent of its 
budget authority, less appropriations from the Nuclear Waste Fund, 
by assessing license and annual fees. OBRA-90 requires that the 
schedule of charges established by rule should fairly and equitably 
allocate the total amount to recover from NRC's licensees and be 
assessed under the principle that licensees who require the greatest 
expenditure of agency resources pay the greatest annual charges. The 
amount to be collected for FY 2000 is approximately $447.0 million.
    Since 1991, the NRC has complied with OBRA-90 by issuing a final 
rule that amends its fee regulations. These final rules have 
established the methodology used by NRC in identifying and 
determining the fees to be assessed and collected in any given 
fiscal year.
    In FY 1995, the NRC announced that, in order to stabilize fees, 
annual fees would be adjusted only by the percentage change (plus or 
minus) in NRC's total budget authority, adjusted for changes in 
estimated collections for 10 CFR Part 170 fees, the number of 
licensees paying annual fees, and as otherwise needed to assure the 
billed amounts resulted in the required collections. The NRC 
indicated that if there was a substantial change in the total NRC 
budget authority or the magnitude of the budget allocated to a 
specific class of licensees, the annual fee base would be 
recalculated.
    In FY 1999, the NRC concluded that there had been significant 
changes in the allocation of agency resources among the various 
classes of licensees and established rebaselined annual fees for FY 
1999. The NRC stated in the final FY 1999 rule that to stabilize 
fees it would continue the policy established in FY 1995 to adjust 
the annual fees by the percent change method, unless there was a 
substantial change in the total NRC budget or the magnitude of the 
budget allocated to a specific class of licensees, in which case the 
annual fee base would be reestablished.
    After evaluating budget data for FY 2000, the NRC has concluded 
that there has not been a substantial change in the total NRC budget 
authority or the magnitude of the budget allocated to a specific 
class of licensees since FY 1999. Therefore, the NRC's proposed FY 
2000 annual fees have been determined by the percent change method 
based on FY 1999 annual fees. As a result, the FY 2000 annual fees 
for all licenses would increase by about 1.4 percent.
    The Small Business Regulatory Enforcement Fairness Act of 1996 
(SBREFA) is intended to reduce regulatory burdens imposed by Federal 
agencies on small businesses, nonprofit organizations, and 
governmental jurisdictions. SBREFA also provides Congress with the 
opportunity to review agency rules before they go into effect. Under 
this legislation, the NRC annual fee rule is considered a ``major'' 
rule and must be reviewed by Congress and the Comptroller General 
before the rule becomes effective. SBREFA also requires that an 
agency prepare a guide to assist small entities in complying with 
each rule for which final regulatory flexibility analysis is 
prepared. This Regulatory Flexibility Analysis and the small entity 
compliance guide (Attachment 1) have been prepared for the FY 2000 
fee rule as required by law.

II. Impact on Small Entities

    The fee rule results in substantial fees being charged to those 
individuals, organizations, and companies that are licensed by the 
NRC, including those licensed under the NRC materials program. The 
comments received on previous proposed fee rules and the small 
entity certifications received in response to previous final fee 
rules indicate that NRC licensees qualifying as small entities under 
the NRC's size standards are primarily materials licensees. 
Therefore, this analysis will focus on the economic impact of the 
annual fees on materials licensees. About 20 percent of these 
licensees (approximately 1,200 licensees for FY 1999) have requested 
small entity certification in the past. A 1993 NRC survey of its 
materials licensees indicated that about 25 percent of these 
licensees could qualify as small entities under the NRC's size 
standards.
    The commenters on previous fee rulemakings consistently 
indicated that the following results would occur if the proposed 
annual fees were not modified.
    1. Large firms would gain an unfair competitive advantage over 
small entities. Commenters noted that small and very small companies 
(``Mom and Pop'' operations) would find it more difficult to absorb 
the annual fee than a large corporation or a high-volume type of 
operation. In competitive markets, such as soils testing, annual 
fees would put small licensees at an extreme competitive 
disadvantage with their much larger competitors because the proposed 
fees would be the same for a two-person licensee as for a large firm 
with thousands of employees.
    2. Some firms would be forced to cancel their licenses. A 
licensee with receipts of less than $500,000 per year stated that 
the proposed rule would, in effect, force it to relinquish its soil 
density gauge and license, thereby reducing its ability to do its 
work effectively. Other licensees, especially well-loggers, noted 
that the increased fees would force small businesses to get rid of 
the materials license altogether. Commenters stated that the 
proposed rule would result in about 10 percent of the well-logging 
licensees terminating their licenses immediately and approximately 
25 percent terminating their licenses before the next annual 
assessment.
    3. Some companies would go out of business.
    4. Some companies would have budget problems. Many medical 
licensees noted that, along with reduced reimbursements, the 
proposed increase of the existing fees and the introduction of 
additional fees would significantly affect their budgets. Others 
noted that, in view of the cuts by Medicare and other third party 
carriers, the fees would produce a hardship and some facilities 
would experience a great deal of difficulty in meeting this 
additional burden.
    Since annual fees for materials licenses were first established, 
approximately 3,000 license, approval, and registration terminations 
have been requested. Although some of these terminations were 
requested because the license was no longer needed or licenses or 
registrations could be combined, indications are that other 
termination requests were due to the economic impact of the fees.
    To alleviate the significant impact of the annual fees on a 
substantial number of small entities, the NRC considered the 
following alternatives, in accordance with the RFA, in developing 
each of its fee rules since 1991.
    1. Base fees on some measure of the amount of radioactivity 
possessed by the licensee (e.g., number of sources).
    2. Base fees on the frequency of use of the licensed radioactive 
material (e.g., volume of patients).
    3. Base fees on the NRC size standards for small entities.

[[Page 16268]]

    The NRC has reexamined its previous evaluations of these 
alternatives and continues to believe that establishment of a 
maximum fee for small entities is the most appropriate and effective 
option for reducing the impact of its fees on small entities.

III. Maximum Fee

    The RFA and its implementing guidance do not provide specific 
guidelines on what constitutes a significant economic impact on a 
small entity. Therefore, the NRC has no benchmark to assist it in 
determining the amount or the percent of gross receipts that should 
be charged to a small entity. In developing the maximum small entity 
annual fee in FY 1991, the NRC examined its 10 CFR Part 170 
licensing and inspection fees and Agreement State fees for those fee 
categories which were expected to have a substantial number of small 
entities. Six Agreement States; Washington, Texas, Illinois, 
Nebraska, New York, and Utah were used as benchmarks in the 
establishment of the maximum small entity annual fee in 1991. 
Because small entities in those Agreement States were paying the 
fees, the NRC concluded that these fees did not have a significant 
impact on a substantial number of small entities. Therefore, those 
fees were considered a useful benchmark in establishing the NRC 
maximum small entity annual fee.
    The NRC maximum small entity fee was established as an annual 
fee only. In addition to the annual fee, NRC small entity licensees 
were required to pay amendment, renewal and inspection fees. In 
setting the small entity annual fee, NRC ensured that the total 
amount small entities paid annually would not exceed the maximum 
paid in the six benchmark Agreement States.
    Of the six benchmark states, the maximum Agreement State fee of 
$3,800 in Washington was used as the ceiling for the total fees. 
Thus the NRC's small entity fee was developed to ensure that the 
total fees paid by NRC small entities would not exceed $3,800. Given 
the NRC's 1991 fee structure for inspections, amendments, and 
renewals, a small entity annual fee established at $1,800 allowed 
the total fee (small entity annual fee plus yearly average for 
inspections, amendments and renewal fees) for all categories to fall 
under the $3,800 ceiling.
    In 1992, the NRC introduced a second, lower tier to the small 
entity fee in response to concerns that the $1,800 fee, when added 
to the license and inspection fees, still imposed a significant 
impact on small entities with relatively low gross annual receipts. 
For purposes of the annual fee, each small entity size standard was 
divided into an upper and lower tier. Small entity licensees in the 
upper tier continued to pay an annual fee of $1,800 while those in 
the lower tier paid an annual fee of $400.
    Between 1991 and 1999, changes in both the external and internal 
environment have impacted NRC costs and those of its licensees. The 
upper and lower tier maximum small entity annual fees did not change 
in those years. Increases in the NRC materials license fees, 
Agreement States' materials license fees, and the Consumer Price 
Index all indicate that the NRC small entity fee established in 1991 
should be revised. In addition to these increases, the structure of 
the fees that NRC charges to its materials licensees changed during 
the period between 1991 and 1999. Costs for materials license 
inspections, renewals, and amendments, which were previously 
recovered through Part 170 fees for services, are now included in 
the Part 171 annual fees assessed to materials licensees.
    While the annual fees increased for most materials licensees as 
a result of these changes, the NRC's annual fees assessed to small 
entities have not been adjusted to include the additional costs. As 
a result, small entities are currently paying a smaller percentage 
of the total NRC regulatory costs related to them than they did in 
FY 1991 and FY 1992 when the small entity fees were established. The 
amount of the small entity subsidy paid by other licensees for these 
regulatory costs was $4.3 million in FY 1991. With the addition of 
the lower tier small entity fee in FY 1992, the small entity subsidy 
increased to $5.4 million, or about $2,700 for each of the 2000 
small entities in FY 1992. Although the number of small entities had 
declined to approximately 1,200 by 1999, the FY 1999 small entity 
subsidy was $5.3 million, or about $4,400 for each small entity.
    Based on the changes that have occurred since FY 1991, the NRC 
has reanalyzed its maximum small entity annual fee. As part of the 
reanalysis, the NRC considered the 1999 fees assessed by Agreement 
States, the NRC's FY 1999 fee structure, and the increase in the 
Consumer Price Index between FY 1991 and FY 1999. The reanalysis and 
alternatives considered by the NRC for revising the small entity 
annual fees are described below.

A. Analysis of Maximum Small Entity Annual Fee

    The analysis included a review of the fee structures in 
Agreement States to determine what fees they currently assess small 
entities. To maintain consistency and to facilitate direct 
comparisons between 1991 and 1999, the analysis focused on the fee 
categories used in 1991 and included fees imposed by the six 
benchmark Agreement States used in 1991 and five other Agreement 
States with the highest number of licenses.
    The eleven states selected were: California, Texas, New York, 
Florida, Illinois, Tennessee, Maryland, Georgia, Washington, Utah, 
and Nebraska. Seven NRC fee categories were selected for review 
based on the number of small entities present in the category and 
inclusion of the category in the 1991 review. The fee categories 
selected were: 3M--Research and Development, 3N--Services, 3O--
Industrial Radiography, 3P--Gauges and Other Industrial Uses, 5A--
Well Logging, 7A--Teletherapy, and 7C--Nuclear Medicine. Together 
these categories comprise 80 percent of NRC's small entity licensees 
for FY 1999.
    Among the eleven Agreement States reviewed, the fee structures 
varied both in terms of the fee amounts and the services included in 
the fees. Of the eleven states, only Georgia and Washington provide 
a separate small entity fee for qualified licensees. The remaining 
nine states do not identify small entities in their fee structure 
and therefore assess the same fee to all licensees regardless of 
their size.
    Increases in the materials license fees since 1991 for the 
eleven Agreement States selected ranged from 10 percent in New York 
to 218 percent in Utah (see Table 1). Of particular note are the 
increases in the States of Washington, Georgia, and Utah. Washington 
and Utah are two of the original states benchmarked in 1991. Georgia 
and Washington are the two Agreement States reviewed that have a 
separate annual fee for small entities.
    The structure of the total fees per year in Georgia is similar 
to that used to determine the total fees paid by NRC small entity 
licensees in 1991. In Georgia, this fee increased by 64 percent from 
1991 to 1999. The increase in Georgia is directly comparable to the 
NRC context since Georgia uses the same two-tier structure for its 
small entity annual fees.
    Washington's maximum fee assessed to small entities increased by 
25 percent, from approximately $3,800 in 1991 to approximately 
$4,700 in 1999. The $4,700 fee is charged for an Industrial 
Radiography license. Washington had the highest maximum fee in 1991 
and it was this fee that provided the basis for the maximum fees 
assessed to NRC small entity licensees.
    Utah had the lowest maximum fee of the six benchmark states in 
1991 . By 1999, Utah's maximum fee had increased by 218 percent, 
from $440 to $1,400. As in Washington, the maximum fee is charged 
for an Industrial Radiography license.
    Table 1 shows the increases in the maximum total fees paid by 
small entities in the selected Agreement States from 1991 to 1999. 
Data is not presented in the Table for the State of California 
because California does not use fee categories that are directly 
mapped to NRC fee categories. California charges a base fee plus a 
fee based on the number of millicuries handled. In addition, because 
the FY 1991 fees for the State of Maryland were not available, only 
the maximum fee for FY 1999 is shown in the Table. The change in the 
maximum fee paid by NRC small entity licensees over the same period 
is included for purposes of comparison. This fee decreased by 47 
percent while fees in the Agreement States were increasing. The 
reason for this decrease is discussed in B. below.

[[Page 16269]]



            Table 1.--Percentage Change in the Maximum Total Fee Assessed to Small Entities Annually
----------------------------------------------------------------------------------------------------------------
                                                                    Maximum fee     Maximum fee       Percent
                              State                                    1991            1999           change
----------------------------------------------------------------------------------------------------------------
Utah............................................................            $440          $1,400             218
Nebraska........................................................           1,456           2,925             101
Texas...........................................................           2,100           4,230             101
Tennessee.......................................................           2,000           4,000             100
Georgia.........................................................           1,650           2,700              64
Florida.........................................................           1,925           2,657              38
Illinois........................................................           2,000           2,733              37
Washington......................................................           3,760           4,699              25
New York........................................................           1,000           1,100              10
Maryland........................................................           (\1\)           1,350           (\1\)
NRC Small Entity................................................           3,400           1,800          (-47)
----------------------------------------------------------------------------------------------------------------
\1\ Not available.

    The increases in the fees assessed to small entities in 
Agreement States between 1991 and 1999 suggest that the cost to 
support radioactive materials licensees has increased over time. 
Because small entities in Agreement States are currently paying the 
increased fees, it can be inferred that the fees do not have a 
significant impact on them.

B. Analysis of Changes in the NRC Small Entity Fee Structure

    When NRC established its small entity annual fee in 1991, the 
fee was viewed as one component of the total annual costs that would 
be assessed to small entities. Table 2 presents the composition of 
the 1991 total annual cost for small entities.

                                               Table 2.--Total Fees Assessed to NRC Small Entities in 1991
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                      Selected Fee Categories
                                         ---------------------------------------------------------------------------------------------------------------
                  Fees                                                     3M  Research
                                                7A          7C  Nuclear         and        3N  Services   3O  Industrial    3P  Gauges       5A  Well
                                            Teletherapy      medicine       development                     radiography                       logging
--------------------------------------------------------------------------------------------------------------------------------------------------------
Annualized Inspection Fee \1\...........            $920           $ 420           $ 200            $140            $920            $180            $210
Amendment Fee \2\.......................             340             340             630             320             390             300             430
Annualized Renewal Fee \3\..............             130             170              40             130             280              80             320
                                         ---------------------------------------------------------------------------------------------------------------
    Subtotal............................           1,390             930             870             590           1,590             560             960
                                         ---------------------------------------------------------------------------------------------------------------
Annual Fee for Small Entity.............           1,800           1,800           1,800           1,800           1,800       \4\ 1,500           1,800
                                         ---------------------------------------------------------------------------------------------------------------
    Total Fees                                     3,200           2,700           2,700           2,400           3,400           2,100           2,800
    (Rounded)...........................
--------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ NRC charged a separate fee for inspections under Part 170. The inspection frequency, defined as years between inspections, varies with each category
  of license. To annualize the inspection fee, the fee charged per inspection was divided by the inspection frequency.
\2\ NRC charged a fee for each amendment to a license. In determining the total annual cost, one amendment per year was assumed.
\3\ In 1991 NRC issued materials licenses for a five-year period. At the end of this period each licensee paid a fee under Part 170 to renew the
  license. Because the licensee paid this fee once every five years, in calculating the total annual cost, the renewal fee was annualized by dividing by
  five.
\4\ The FY 1991 annual fee of $1,500 for category 3P was less than the $1,800 small entity annual fee. Therefore, small entities in this category paid
  the $1,500 annual fee, not $1,800.

    Since 1991, NRC's Part 170 inspection, renewal, and amendment 
fees for materials licenses have been eliminated and the costs of 
those services included in the annual fee. Although the annual fee 
now covers the costs for inspections, renewals, and amendments, the 
small entity fee itself remained unchanged. As a result, the maximum 
NRC fees paid by small entities has declined by 47 percent, from 
$3,400 in 1991 to $1,800 in 1999. This decrease occurred while the 
average total non-small entity annual fee for other NRC materials 
licenses increased by 25 percent and the average maximum annual fee 
for small entity licensees in Agreement States increased by 54 
percent.
    Table 3 compares the total fees (annual, inspection, renewal, 
and amendment) assessed to NRC materials licensees in 1991 with the 
total fees (annual) assessed to these licensees in 1999. In five of 
the seven categories the fee increases were over 20 percent. Of 
particular note are the increases in categories 7C--Nuclear 
Medicine, 3O--Industrial Radiography, and 3P--Gauges. These 
categories contain 67 percent of the small entity licenses invoiced 
for FY1999. The average fee increase for these three categories is 
31 percent, compared to the 25 percent average for the seven 
categories reviewed.

[[Page 16270]]



                              Table 3.--Comparison Between Total NRC Annual Fees for Selected Categories for 1991 and 1999
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                             7C          3M                      3O
                         NRC Fees                                7A       Nuclear    Research &      3N      Industrial  3P Gauges   5A  Well   Average
                                                            Teletherapy   medicine  development   Services  radiography              logging
--------------------------------------------------------------------------------------------------------------------------------------------------------
1991 Annual Fee...........................................      $9,700      $3,500      $4,000      $4,400      $9,300      $1,500     $7,000     $5,600
1991 Other Fees:
    Annualized Inspection Fee.............................         920         420         200         140         920         180        200
    Amendment Fee.........................................         340         340         630         320         390         300        430
    Annualized Renewal Fee................................         130         170          40         130         280          80        320
                                                           -----------------------------------------------------------------------------------
        Total Other Fees..................................       1,390         930         870         590       1,590         560        950
Total Fee in 1991 (Rounded)...............................      11,100       4,400       4,900       5,000      10,900       2,100      8,000      6,700
Total (Annual) Fee In 1999................................      15,300       5,800       5,000       5,200      14,700       2,600      9,900      8,400
Fee Increase from 1991 to 1999............................         38%         32%          2%          4%         35%         24%        24%        25%
--------------------------------------------------------------------------------------------------------------------------------------------------------

    Table 4 compares the 1991 fees for amendments and inspections 
with the cost to provide these services in 1999. The cost was 
determined by multiplying the average hours to complete amendments 
and inspections by the hourly rate. The 1999 cost for amendments is 
on average 60 percent higher than the amendment fee assessed in 
1991; inspection costs are 260 percent higher. These services are 
provided to all licensees, both small entities and non-small 
entities. However, under the current fee structure these costs are 
recovered only from annual fees assessed to non-small entities. 
Because the small entity annual fee has remained static, it does not 
reflect any increases in NRC's costs since 1991.

                   Table 4.--Comparison of NRC Inspection and Amendment Costs in 1991 and 1999
----------------------------------------------------------------------------------------------------------------
                                                           Amendments                      Inspections
                                               -----------------------------------------------------------------
                                                                       Increase                         Increase
                                                   1991       1999    (percent)     1991       1999    (percent)
----------------------------------------------------------------------------------------------------------------
7A--Teletherapy...............................       $340       $450         32       $920     $3,200        248
7C--Nuclear Medicine..........................        340        520         53        830      3,100        273
3M--Research & Development....................        630        710         13        800      2,300        188
3N--Services..................................        320        690        116        550      2,700        391
3O--Industrial Radiography....................        390        780        100        920      3,300        259
3P--Gauges....................................        300        390         30        920      2,200        139
5A--Well Logging..............................        430        950        121        640      2,700        322
Average.......................................        400        640         60        800      2,900        263
----------------------------------------------------------------------------------------------------------------

    Given NRC's 100 percent cost recovery requirement, the portion 
of annual fees not recovered from small entities is passed to other 
NRC licensees. The increasing disparity between the small entity fee 
and the cost of NRC services included in the annual fee calls for a 
more equitable distribution of the NRC costs to these licensees. An 
increase in the small entity fee would mitigate the cost differences 
and would permit small entities to assume a greater portion of NRC 
costs attributable to them. If everything else remains the same, an 
increase in the small entity fee would result in a decrease in the 
small entity subsidy paid by other licensees.

C. Analysis of Increases in the Consumer Price Index

    On a national level the cost of goods and services increased 
between 1991 and 1999. According to the U.S. Department of Labor, 
Bureau of Labor Statistics, the Consumer Price Index (CPI) increased 
28.8 points, from 136.2 in 1991 to 165.0 for the first half of 1999, 
an increase of 21 percent. This index is an accepted economic 
indicator of price changes in the US economy. The 21 percent 
increase in the CPI is evidence that costs in NRC's external 
environment have increased. Obviously, NRC's cost of providing 
services to its licensees will be impacted by these increases.

D. Alternatives for Revising the Maximum Annual Fee

1. Increase Small Entity Fees Using the 1991 Methodology

    Following the reasoning used in the 1991 process, the maximum 
annual fee for small entities could be revised to reflect the 
current maximum fees charged by Agreement States and the changes in 
the NRC fee structure since 1991. The maximum Agreement State fee 
assessed to small entities in 1999 is $4,700. Therefore, the maximum 
value for NRC's small entity fee could be set at $4,700.
    This method would allow the NRC to recover from small entities 
48 percent of the total amount of the small entity annual fee 
invoices. Although this method is defensible, because it is based on 
sound reasoning used in the original establishment of the small 
entity fees that have been in place since 1991, it is based on an 
external fee that is outside NRC's direct control.

2. Increase the Small Entity Fee Using the Average Increase in NRC 
Materials License Fees From 1991 to 1999

    From 1991 to 1999 total NRC fees for materials licenses 
increased, on average, by 25 percent. This percentage could be 
applied to the existing small entity fee to give a new small entity 
fee of $2,300.
    This method is a simple and obvious means of applying the rates 
of increase in NRC fees since FY 1991 to the small entity fees. This 
method does not consider the changes to the total fees paid by small 
entities since FY 1991 and does not incorporate changes in the 
composition of the total fees assessed to small entities per year by 
Agreement States. However, it does rely on the increases to the 
total fees paid by other NRC materials licensees since FY 1991. This 
method could also provide a sustainable and simple means of 
determining whether NRC's small entity fees should be revised in the 
future.

3. Add the 1991 Amendment, Renewal, and Inspection Costs to the 
Existing Small Entity Fee and Increase the Sum by the Average Increase 
in NRC Materials License Fees From 1991 to 1999

    The small entity fee could be increased by loading the existing 
small entity annual fee of $1,800 with the amendment, renewal, and 
inspection costs used in 1991 and increasing the total by 25 
percent. This method not only incorporates the average increase in 
NRC fees but it bases the increase on the total annual costs that 
were assessed to small entities in 1991.
    To revise the small entity fee using this method, a category 
must be selected as the 1991 base. The total annual cost for this

[[Page 16271]]

category, as presented in Table 3, will then be increased by the NRC 
average of 25 percent. Five possible approaches to selecting the 
1991 base were explored.

Method 3A--Maximum Fee Category in the Benchmark States

    Method 3A uses the Industrial Radiography category as the base. 
This category had the maximum fee in the Agreement States 
benchmarked in 1991. The total NRC fee assessed to the Industrial 
Radiography category in 1991 was $3,400. Increasing this fee by 25 
percent gives a new small entity fee of $4,300.

Method 3B--Highest Number of Small Entities Present

    Method 3B uses the fee category with the highest number of small 
entities. In FY1999, Category 3P, Gauges and Other Industrial Uses, 
had 30 percent of all NRC small entity licensees. This was the 
highest number of small entities present in a single category. In 
1991, the total fees for Category 3P was $2,100. A 25 percent 
increase in this fee would set the small entity fee at $2,600.

Method 3C--Highest Number of Upper Tier Small Entities Present

    Method 3C uses Category 7C, Nuclear Medicine as the base. This 
category has the highest number of upper tier small entities and is 
considered a viable base because the small entity annual fee 
originally established in FY 1991 was the upper tier fee. In 1991, 
Category 7C had a total fee of $2,700; this base would give a new 
small entity fee of $3,400.
    Method 3A yields a 45 percent recovery of the invoiced amounts 
from small entities, the highest recovery rate under Method 3. 
However, the Industrial Radiography category contains only 7 percent 
of all NRC small entity licensees in 1999 and arguably does not 
affect a significant number of the small entities. Method 3B 
addresses this issue and uses Category 3P, the category with the 
highest number of small entities. However, the 3P Category also has 
the lowest 1991 total cost and results in a recovery rate of 34 
percent from small entities, the lowest under Method 3. Method 3C 
uses Category 7C, Nuclear Medicine, and is preferable to both 
Methods 3A and 3B in that it yields a 37 percent recovery rate from 
small entities and contains 30 percent of the small entity 
licensees.
    Methods 3A, 3B and 3C are all based on the selection of a single 
fee category as the 1991 base. Using the fee from a specific fee 
category as the base fee can implicitly make the category a 
benchmark. This increases the risk of challenges to the fee if 
significant changes occur in the benchmark category.

Method 3D--Weighted Average of the Total Fees in the Seven 
Categories

    Method 3D uses the number of upper tier small entities in each 
category to weight the total fee assessed to each category in 1991. 
The weighted-average of $2,700 is then used as the base. This gives 
a new small entity fee of $3,400.

Method 3E--Average of the Total Fees for the Seven Categories

    Method 3E uses the average total fee for the categories reviewed 
as the base fee. The average total fee of $2,800 is then increased 
by 25 percent to give a new small entity fee of $3,500.
    Both Methods 3D and 3E use averages to determine the base fee 
and this reduces the risks associated with Methods 3A, 3B and 3C. 
Both methods yield the same recovery rate of 37 percent and can be 
considered equally acceptable from a monetary perspective.
    Because Method 3D uses a weighted average, the number of small 
entities in each of the seven categories are factored into the 
selection process while smoothing the impact of the highest and 
lowest fee categories.
    While Methods 3D and 3E would consider the total fees paid by 
small entities in FY 1991 and would increase the amounts recovered 
from small entities thereby reducing the small entity subsidy paid 
by other licensees, the percentage increase under either of these 
methods would be larger than the average percentage increase in the 
total fees assessed to other NRC materials licensees since FY 1991.

IV. Conclusion

    Based on the results of the reanalysis, the NRC is proposing to 
increase the maximum small entity annual fee by 25 percent, based on 
the percentage increase since FY 1991 in the average total fees paid 
per year by other NRC materials licensees. As a result, the maximum 
small entity annual fee would increase from $1,800 to $2,300. By 
increasing the maximum annual fee for small entities from $1,800 to 
$2,300, the annual fee for many small entities is reduced while at 
the same time materials licensees, including small entities, would 
pay for most of the costs attributable to them. The costs not 
recovered from small entities are allocated to other materials 
licensees and to power reactors.
    While reducing the impact on many small entities, the proposed 
maximum annual fee of $2,300 for small entities may continue to have 
a significant impact on materials licensees with annual gross 
receipts in the thousands of dollars. Therefore, the NRC would 
continue to provide a lower-tier small entity annual fee for small 
entities with relatively low gross annual receipts. The lower-tier 
small entity fee also applies to manufacturing concerns, and 
educational institutions not State or publicly supported, with less 
than 35 employees. The NRC is proposing to increase the lower tier 
small entity fee by the same percentage increase to the maximum 
small entity annual fee. This 25 percent increase would result in 
the lower tier small entity fee increasing from $400 to $500.
    In the future, the NRC plans to re-examine the small entity fees 
each year that annual fees are rebaselined. As part of the re-
examination, the NRC will consider the percentage increase in fees 
paid by other NRC materials licensees since the last rebaselining to 
determine if the maximum small entity annual fees should be revised.
    The NRC continues to believe that the 10 CFR Part 170 
application fees, or any adjustments to these licensing fees during 
the past year, do not have a significant impact on small entities.

V. Summary

    The NRC has determined that the 10 CFR Part 171 annual fees 
significantly impact a substantial number of small entities. A 
maximum fee for small entities strikes a balance between the 
requirement to collect 100 percent of the NRC budget and the 
requirement to consider means of reducing the impact of the fee on 
small entities. On the basis of its regulatory flexibility analyses, 
the NRC concludes that a maximum annual fee of $2,300 for small 
entities and a lower-tier small entity annual fee of $500 for small 
businesses and not-for-profit organizations with gross annual 
receipts of less than $350,000, small governmental jurisdictions 
with a population of less than 20,000, small manufacturing entities 
that have less than 35 employees and educational institutions that 
are not State or publicly supported and have less than 35 employees 
reduces the impact on small entities. At the same time, these 
reduced annual fees are consistent with the objectives of OBRA-90. 
Thus, the fees for small entities maintain a balance between the 
objectives of OBRA-90 and the RFA.

Attachment 1 to Appendix A.--U.S. Nuclear Regulatory Commission, Small 
Entity Compliance Guide, Fiscal Year 2000

Contents

Introduction
NRC Definition of Small Entity
NRC Small Entity Fees
Instructions for Completing NRC Form 526

Introduction

    The Small Business Regulatory Enforcement Fairness Act of 1996 
(SBREFA) requires all Federal agencies to prepare a written guide 
for each ``major'' final rule as defined by the Act. The NRC's fee 
rule, published annually to comply with the Omnibus Budget 
Reconciliation Act of 1990 (OBRA-90), requires the NRC to collect 
approximately 100 percent of its budget authority each year through 
fees. This rule is considered a ``major'' rule under this law. This 
compliance guide has been prepared to assist NRC material licensees 
comply with the FY 2000 fee rule.
    Licensees may use this guide to determine whether they qualify 
as a small entity under NRC regulations and are eligible to pay 
reduced FY 2000 annual fees assessed under 10 CFR Part 171. The NRC 
has established two tiers of separate annual fees for those 
materials licensees who qualify as small entities under NRC's size 
standards.
    Licensees who meet NRC's size standards for a small entity must 
complete NRC Form 526 to qualify for the reduced annual fee. This 
form accompanies each annual fee invoice mailed to materials 
licensees. The completed form, the appropriate small entity fee, and 
the payment copy of the invoice, should be mailed to the U.S. 
Nuclear Regulatory Commission, License Fee and Accounts Receivable 
Branch, to the address indicated on the invoice. Failure to file a 
small entity certification in a timely manner may result in the 
denial of any refund that might otherwise be due.

[[Page 16272]]

NRC Definition of Small Entity

    The NRC has defined a small entity for purposes of compliance 
with its regulations (10 CFR 2.810) as follows:
    1. Small business--a for-profit concern that provides a service 
or a concern not engaged in manufacturing with average gross 
receipts of $5 million or less over its last 3 completed fiscal 
years;
    2. Manufacturing industry--a manufacturing concern with an 
average number of 500 or fewer employees based upon employment 
during each pay period for the preceding 12 calendar months;
    3. Small organization--a not-for-profit organization which is 
independently owned and operated and has annual gross receipts of $5 
million or less;
    4. Small governmental jurisdiction--a government of a city, 
county, town, township, village, school district or special district 
with a population of less than 50,000;
    5. Small educational institution--an educational institution 
supported by a qualifying small governmental jurisdiction, or one 
that is not state or publicly supported and has 500 or fewer 
labors.\1\
---------------------------------------------------------------------------

    \1\ An educational institution referred to in the size standards 
is an entity whose primary function is education, whose programs are 
accredited by a nationally recognized accrediting agency or 
association, who is legally authorized to provide a program of 
organized instruction or study, who provides an educational program 
for which it awards academic degrees, and whose educational programs 
are available to the public.
---------------------------------------------------------------------------

NRC Small Entity Fees

    In 10 CFR 171.16 (c), the NRC has established two tiers of small 
entity fees for licensees that qualify under the NRC's size 
standards. The NRC is proposing to increase these fees by 25 
percent. The proposed fees are as follows:

------------------------------------------------------------------------
                                                              Maximum
                                                          annual fee per
                                                              licensed
                                                             category
------------------------------------------------------------------------
Small Business Not Engaged in Manufacturing and Small
 Not-For Profit Organizations (Gross Annual Receipts):
      $350,000 to $5 million............................          $2,300
      Less than $350,000................................             500
Manufacturing entities that have an average of 500
 employees or less:
      35 to 500 employees...............................           2,300
      Less than 35 employees............................             500
Small Governmental Jurisdictions (Including publicly
 supported educational institutions) (Population):
      20,000 to 50,000..................................           2,300
      Less than 20,000..................................             500
Educational Institutions that are not State or Publicly
 Supported, and have 500 Employees or Less:
      35 to 500 employees...............................           2,300
      Less than 35 employees............................             500
------------------------------------------------------------------------

    To pay a reduced annual fee, a licensee must use NRC Form 526, 
enclosed with the fee invoice, to certify that it meets NRC's size 
standards for a small entity. Failure to file NRC Form 526 in a 
timely manner may result in the denial of any refund that might 
otherwise be due.

Instructions for Completing NRC Form 526

    1. File a separate NRC Form 526 for each annual fee invoice 
received.
    2. Complete all items on NRC Form 526 as follows:
    a. The license number and invoice number must be entered exactly 
as they appear on the annual fee invoice.
    b. The Standard Industrial Classification (SIC) Code should be 
entered if it is known.
    c. The licensee's name and address must be entered as they 
appear on the invoice. Name and/or address changes for billing 
purposes must be annotated on the invoice. Correcting the name and/
or address on NRC Form 526 or on the invoice does not constitute a 
request to amend the license. Any request to amend a license is to 
be submitted to the respective licensing staffs in the NRC Regional 
or Headquarters Offices.
    d. Check the appropriate size standard under which the licensee 
qualifies as a small entity. Check one box only. Note the following:
    (1) The size standards apply to the licensee, not the individual 
authorized users listed in the license.
    (2) Gross annual receipts as used in the size standards includes 
all revenue in whatever form received or accrued from whatever 
sources, not solely receipts from licensed activities. There are 
limited exceptions as set forth at 13 CFR 121.104. These are: the 
term receipts excludes net capital gains or losses, taxes collected 
for and remitted to a taxing authority if included in gross or total 
income, proceeds from the transactions between a concern and its 
domestic or foreign affiliates (if also excluded from gross or total 
income on a consolidated return filed with the IRS), and amounts 
collected for another by a travel agent, real estate agent, 
advertising agent, or conference management service provider.
    (3) A licensee who is a subsidiary of a large entity does not 
qualify as a small entity.
    (4) The owner of the entity, or an official empowered to act on 
behalf of the entity, must sign and date the small entity 
certification.
    The NRC sends invoices to its licensees for the full annual fee, 
even though some entities qualify for reduced fees as a small 
entity. Licensees who qualify as a small entity and file NRC Form 
526, which certifies eligibility for small entity fees, may pay the 
reduced fee, which for a full year is either $2,300 or $500 
depending on the size of the entity, for each fee category shown on 
the invoice. Licensees granted a license during the first six months 
of the fiscal year and licensees who file for termination or for a 
possession only license and permanently cease licensed activities 
during the first six months of the fiscal year pay only 50 percent 
of the annual fee for that year. Such an invoice states the ``Amount 
Billed Represents 50% Proration.'' This means the amount due from a 
small entity is not the prorated amount shown on the invoice but 
rather one-half of the maximum annual fee shown on NRC Form 526 for 
the size standard under which the licensee qualifies, resulting in a 
fee of either $1150 or $250 for each fee category billed instead of 
the full small entity annual fee of $2,300 or $500.
    A new small entity form (NRC Form 526) must be filed with the 
NRC each fiscal year to qualify for reduced fees for that fiscal 
year. Because a licensee's ``size,'' or the size standards, may 
change from year to year, the invoice reflects the full fee and a 
new Form must be completed and returned for the fee to be reduced to 
the small entity fee. LICENSEES WILL NOT BE ISSUED A NEW INVOICE FOR 
THE REDUCED AMOUNT. The completed NRC Form 526, the payment of the 
appropriate small entity fee, and the ``Payment Copy `` of the 
invoice should be mailed to the U. S. Nuclear Regulatory Commission, 
License Fee and Accounts Receivable Branch at the address indicated 
on the invoice.
    If you have questions about the NRC's annual fees, please call 
the license fee staff at 301-415-7554, e-mail the fee staff at 
[email protected], or write to the U.S. Nuclear Regulatory Commission, 
Washington, DC 20555, Attention: Office of the Chief Financial 
Officer.
    False certification of small entity status could result in civil 
sanctions being imposed by the NRC under the Program Fraud Civil 
Remedies Act, 31 U.S.C. 3801 et seq. NRC's implementing regulations 
are found at 10 CFR Part 13.

[FR Doc. 00-6914 Filed 3-24-00; 8:45 am]
BILLING CODE 7590-01-P