[Federal Register Volume 65, Number 241 (Thursday, December 14, 2000)]
[Notices]
[Pages 78198-78213]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-31875]


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NUCLEAR REGULATORY COMMISSION

[Docket Nos. 50-333-LT and 50-286-LT (consolidated)]


Power Authority of the State of New York and Entergy Nuclear 
Fitzpatrick LLC, Entergy Nuclear Indian Point 3 LLC, Entergy Nuclear 
Operations, Inc. (James A. FitzPatrick Nuclear Power Plant) and Indian 
Point Nuclear Generating Unit No. 3); CLI-00-22, Memorandum and Order

    Commissioners: Richard A. Meserve, Chairman, Greta Joy Dicus, 
Nils J. Diaz, Edward McGaffigan, Jr. and Jeffrey S. Merrifield

Table of Contents

I. Introduction

II. The License Transfer Applications

III. Preliminary Procedural Issues

A. CAN's Motion to Consolidate the Commission's Consideration of the 
Applications
B. Association's and CAN's Motions for Stay
C. Applicants' Request to Deny Cortlandt's Hearing Motion on 
Procedural Grounds
D. CAN's Motion for a Formal Subpart G Hearing
E. Petitioners' Request for Access to Unredacted Versions of 
Financial Information

IV. Discussion

A. Standing
    1. CAN
    2. The Association
    3. Local Governmental Entities
B. Admissibility of Issues
    1. General Concerns
    2. Financial Qualifications Issues
    a. Joint and Several Liability
    b. Limited Liability Corporation
    c. Baseline Funding
    3. Decommissioning Issues
    a. Consistency of Decommissioning Funding Arrangement with 10 
CFR 50.75
    b. Commitment and Ability to Decommission Indian Point 3 to 
Greenfield Condition
    c. Extension or Renewal of Indian Point 3 License
    d. Management of Indian Point 3 Decommissioning Fund
    e. Scope of Commission's Consideration of Indian Point 3 
Decommissioning Issues to Include Indian Point 2 Matters
    f. Entergy's Intention to Make a Profit on the Decommissioning 
Fund
    g. Lack of Provision for Off-Site Remediation
    h. Environmental Impact Statements
    4. CAN's Non-Labor-Related Technical Qualifications Issues
    a. Age-Related Defects at Both Plants
    b. Leak-Detection Problems at Both Plants
    c. Issues of Management ``Character''
    d. Cost-Cutting Pressures
    5. The Association's Labor-Related Technical Qualifications 
Issues
    6. Issues Involving Emergency Evacuation Plans
    7. Appropriateness of Indian Point 3 Transfer, Given its 
Location
    8. Antitrust Issue
    9. Independent Evaluation of the Plants

V. Other Procedural Matters

A. Designation of Issues
B. Designation of Presiding Officer
C. Notices of Appearance
D. Filing Schedule
E. Participants in the Hearing and the Proceeding; Service List
F. Service Requirements

VI. Conclusion

I. Introduction

    This proceeding involves applications which together seek the 
Commission's authorization to transfer the operating licenses of both 
the Indian Point Nuclear Generating Unit No. 3 (``Indian Point 3'') and 
the James A. FitzPatrick Nuclear Power Plant (``FitzPatrick''). The 
Indian Point plant is located in Westchester County, New York, beside 
the Hudson River. Its property lies partially within the Town of 
Cortlandt and entirely within the Hendrick Hudson School District. The 
FitzPatrick plant is located in the town of Scriba in Oswego County, 
New York.
    The Power Authority of the State of New York (``PASNY'') seeks to 
transfer its ownership interest in, and operating/maintenance 
responsibility for, the Indian Point 3 plant to Entergy Nuclear Indian 
Point 3, LLC (``Entergy Indian Point'') and Entergy Nuclear Operations, 
Inc. (``Entergy Nuclear Operations''), respectively. Similarly, PASNY 
would transfer its ownership interest in, and operating/maintenance 
responsibility for, the FitzPatrick plant to Entergy Nuclear 
FitzPatrick, LLC (``Entergy FitzPatrick'') and Entergy Nuclear 
Operations, respectively.
    The applications were submitted to the Commission on May 11 and 12, 
2000, pursuant to Section 184 of the Atomic Energy Act of 1954 
(``AEA'') \1\

[[Page 78199]]

and section 50.80 of the Commission's regulations.\2\ On June 28, 2000, 
the Commission published notices of the FitzPatrick and Indian Point 3 
applications in the Federal Register. See 65 FR 39953 and 39954, 
respectively.
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    \1\ 42 U.S.C. 2234 (precluding the transfer of any NRC license 
unless the Commission both finds the transfer in accordance with the 
AEA and gives its consent in writing). On November 9, 2000, the NRC 
staff issued orders approving the two applications for license 
transfer. Pursuant to 10 CFR 2.1327, the petitioners in this 
proceeding could have asked the Commission by November 17, 2000, to 
stay the effect of the staff's two orders, but petitioners filed no 
stay motion. Consequently, PASNY and the Entergy companies were free 
to close the sale of the two nuclear plants, which they did on 
November 21, 2000. Neither the staff's approvals, nor the closing of 
the sale affects the instant adjudicatory proceeding. The purpose of 
this proceeding is to resolve whether, for the reasons raised by the 
petitioners, the Commission should disapprove the transfers and 
require the applicants to return the plant ownership to the status 
quo ante or modify the license notwithstanding the staff's orders 
and the applicants' actual consummation of the sale. See Vermont 
Yankee Nuclear Power Corp. (Vermont Yankee Nuclear Power Station), 
CLI-00-17, 52 NRC 79, 82-83 (2000).
    \2\ 10 CFR 50.80. This regulation reiterates the requirements of 
AEA section 184, sets forth the filing requirements for a license 
transfer application and establishes the following test for approval 
of such an application: (1) the proposed transferee is qualified to 
hold the license and (2) the transfer is otherwise consistent with 
law, regulations and Commission orders.
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    The Commission received five petitions to intervene (or 
participate) and requests for hearing from individuals or entities 
wishing to address or oppose one or both of the license transfer 
applications. The petitioners are Citizens Awareness Network (``CAN''); 
the Town of Cortlandt together with the Hendrick Hudson School District 
(collectively ``Cortlandt''); Westchester County (``Westchester'') 
(petitioning to participate as a governmental entity); Local 1-2 of the 
Utility Workers of America (``the Union''); and the Nuclear Generation 
Employees Association, together with William Carano, Thomas Pulcher and 
Richard Wiese, Jr. (collectively ``the Association'').\3\ The 
applicants filed an Answer to each of these hearing requests. All 
petitioners except Westchester submitted replies to the applicants' 
answers. The Union subsequently withdrew its petition. The NRC staff is 
not participating as a party in the adjudicatory portion of this 
proceeding. See generally 10 CFR Sec. 2.1316(b), (c). We consider the 
pleadings under Subpart M of our procedural rules. 10 CFR 2.1301-
2.1331.
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    \3\ In addition, the County of Putnam sought and was granted an 
extension of time until July 31, 2000, by which to file its petition 
to intervene and request for hearing. However, Putnam filed no 
petition or request.
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    For the reasons set forth below, we grant the requests for hearing 
of CAN, Cortlandt and the Association. We also grant Westchester's 
request to participate in a hearing as an interested governmental 
entity. Finally, we admit certain issues involving whether the Entergy 
companies have demonstrated their financial ability to operate and 
maintain the plants safely and whether they have provided a reasonable 
assurance of adequate decommissioning funding.

II. The License Transfer Applications

    As noted above, PASNY, Entergy FitzPatrick and Entergy Nuclear 
Operations have filed applications seeking to transfer the ownership of 
the FitzPatrick plant to Entergy FitzPatrick and the operating and 
maintenance responsibilities for the plant to Entergy Nuclear 
Operations. The regulatory responsibility for decommissioning the plant 
would also transfer to Entergy FitzPatrick. Pursuant to the 
Decommissioning Agreements and subject to the monetary limits of those 
Agreements, PASNY would retain the decommissioning funds and would have 
a contractual obligation to provide funds to Entergy FitzPatrick (up to 
a specified limit) to decommission the FitzPatrick plant.\4\
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    \4\ Commitments limiting PASNY's role to holding and disbursing 
the decommissioning funds are contained in a letter dated Sept. 21, 
2000.
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    Similarly, PASNY, Entergy Indian Point and Entergy Nuclear 
Operations have filed applications seeking to transfer the ownership of 
the Indian Point plant to Entergy Indian Point and the operating and 
maintenance responsibilities for the plant to Entergy Nuclear 
Operations. The regulatory responsibility for decommissioning the plant 
would also transfer to Entergy Indian Point. Pursuant to the 
Decommissioning Agreements and subject to the monetary limits of those 
Agreements, PASNY would retain the Decommissioning Funds and would have 
a contractual obligation to provide funds to Entergy Indian Point (up 
to a specified limit) to decommission the Indian Point 3 plant.
    Under both applications, however, PASNY would have the option of 
terminating this contractual obligation upon the occurrence of certain 
events specified in the Decommissioning Agreements. Upon such 
termination, PASNY would have no further contractual responsibility to 
its successor owner (Entergy FitzPatrick or Entergy Indian Point, as 
applicable) and no further involvement with the decommissioning process 
for that plant. At that point, PASNY would be required to transfer the 
decommissioning funds to its successor owner, subject to certain 
conditions.
    If PASNY does not terminate its contractual responsibility before 
the decommissioning of the applicable plant begins, then PASNY's 
contractual responsibility would be carried out pursuant to the 
Decommissioning Agreements. Under those Agreements, PASNY and Entergy 
Nuclear, Inc. (``ENI'') must enter into an agreement whereby ENI would 
decommission the plants in accordance with the Decommissioning 
Agreements. Entergy FitzPatrick and Entergy Indian Point, through their 
authorized agent, Entergy Nuclear Operations, would at all times retain 
ultimate control over the timing and control of the decommissioning 
activities of ENI and its contractors.
    The new owners and the new operator of the Indian Point 3 and 
FitzPatrick nuclear plants are not ``electric utilities'' under our 
rules, and thus must demonstrate financial qualifications to own and/or 
operate the plant. See 10 CFR 50.33(f). These Entergy companies have 
submitted five-year cost and revenue projections in accordance with our 
rules, see id., but much of their material was submitted as 
confidential financial information and has been withheld from public 
disclosure.
    Upon the closing of the purchase and sales agreements, all 
employees within PASNY's Nuclear Generation Department, and certain 
other employees supporting the Nuclear Generation Department, would 
become employees of Entergy Nuclear Operations. The application 
proposes no physical or operational changes to the FitzPatrick or 
Indian Point facilities, but does request certain administrative 
changes to the licenses that are necessary to reflect the proposed 
transfers. See 65 FR at 39953-54.
    Before reaching petitioners' standing and the admissibility of 
their issues, we must first address certain pending procedural motions.

III. Preliminary Procedural Issues

A. CAN'S Motion to Consolidate the Commission's Consideration of the 
Applications

    CAN moves for a joint hearing on all applications. CAN argues that 
there are overarching concerns that affect the transfer of both 
facilities--concerns stemming from the Entergy companies' joint 
negotiation of both sales and their intertwining of the two plants' 
finances, day-to-day operations and reactor decommissioning. See CAN's 
Petition, dated July 31, 2000, at 7. Conversely, Cortlandt objects to 
such a consolidation. Cortlandt states that the issuance of separate 
orders for each facility would be in the public interest because it 
``would facilitate review

[[Page 78200]]

thereof and action thereupon.'' \5\ However, Cortlandt has offered us 
no rationale to justify this conclusion. Given that CAN and the 
Association present a number of arguments applicable to both plants, we 
believe that the parties' and the Commission's resources are better 
spent by addressing these arguments only once. We therefore grant CAN's 
motion to consolidate the FitzPatrick and Indian Point 3 license 
transfer proceedings.
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    \1\ See Cortlandt's Petition for Extension of Time, dated July 
7, 2000, at 4 n.1. This petition, despite its name, includes both a 
petition to intervene and request for hearing.
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B. The Association's and CAN's Motions for Stay

    The Association seeks a stay of this NRC proceeding pending a 
decision by the New York courts regarding the rights, obligations and 
liabilities of its members, the Entergy companies, and PASNY. See 
Association's Petition to Intervene, dated July 17, 2000, at 19, 21. 
The Association brought that state court action on July 27, 2000.\6\ In 
support, the Association asserts that the state court action could 
render void or voidable the sales transaction involving the two plants, 
that the outcome of the state court action could assist in clarifying 
the Commission record, and that consummation of the sales transaction 
could render irreversible many aspects of the Association members' 
relationship with the applicants. See Association's Reply Brief, dated 
Aug. 3, 2000, at 26.
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    \6\ See Verified Petition, Nuclear Generation Employees Ass'n v. 
New York Power Auth. (Sup. Ct., Westchester Co., NY), Index No. 
11129/00 (filed July 27, 2000) (appended to Association's Reply 
Brief as Exh. 1). See also Association's Reply Brief, dated Aug. 3, 
2000, at 3. We note in passing that, on July 26, 2000, the Town of 
Cortlandt filed a separate action in New York State court, also 
challenging the transfer. See Verified Petition, Town of Cortlandt 
v. Power Auth. of the State of N.Y. (Sup. Ct., Westchester Co., NY), 
Index No. 11084-00 (filed July 26, 2000) (appended to Cortlandt's 
Supplemental Statement, dated July 31, 2000) (hereafter ``Cortlandt 
Verified Petition''), petition denied (Sept. 15, 2000), appeal 
noticed (Sept. 22, 2000) (court denial and appeal notice both 
appended to Cortlandt's Submission of Supplemental Information, 
dated Sept. 28, 2000). See also Affirmation of Peter Henner, dated 
July 31, 2000, at para. 29 (appended to Cortlandt's Supplemental 
Statement, dated July 31, 2000). (We cite to the paragraph rather 
than the page number of Mr. Henner's Affirmation because neither 
version of this document is paginated and because the contents of 
the first version appear on different pages from the same content of 
the second version.)
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    Similarly, CAN seeks a stay of the adjudication until the Internal 
Revenue Service (``IRS''), the Federal Energy Regulatory Commission 
(``FERC'') and the New York State Department of Environmental 
Conservation (``DEC'') have completed their own proceedings involving 
the transfer of the two plants.\7\ CAN asserts that these agencies' 
rulings could affect the Entergy companies' ability to own, operate and 
decommission the two plants,\8\ and that DEC or IRS rulings adverse to 
Entergy could render the sales agreement void or voidable.\9\
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    \7\ On Sept. 29, 2000, FERC authorized Entergy Indian Point's 
and Entergy FitzPatrick's purchase of the Indian Point 3 and 
FitzPatrick nuclear plants, respectively, from PASNY. See Entergy 
Nuclear Indian Point 3, LLC and Entergy Nuclear FitzPatrick, LLC, 
Docket No. EC00-100-000, ``Order Authorizing Disposition of 
Jurisdictional Facilities,'' 92 FERC para. 61,281 (Sept. 29, 2000).
    Separately, it is not at all clear whether there is any request 
or proceeding pending before the IRS. Such a request appears to be 
the assumption on which one of the Association's issues rests (see 
Association's Petition at 18, referring to the potential effects of 
``[a] contrary ruling by the IRS''), and also is expressly one of 
the assumptions on which CAN bases its instant stay request. 
However, the record contains no indication that the applicants have 
ever sought such an IRS ruling. Conversely, the applicants' 
responses to the Association's (and CAN's) arguments never deny 
seeking an IRS ruling.
    \8\ See CAN's Petition at 1-7. See also id. at 14 (rapid 
consolidation of nuclear industry justifies a stay pending changes 
in NRC regulations and enforcement practices); CAN's Reply Brief, 
dated Aug. 17, 2000, at 5-6.
    \9\ CAN's Reply Brief at 6.
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    As we indicated in a prior case, the pendency of parallel 
proceedings before other forums is not adequate grounds to stay a 
license transfer adjudication. See Niagara Mohawk Power Corp. (Nine 
Mile Point, Units 1 and 2), CLI-99-30, 50 NRC 333, 343-44 (1999). We 
therefore deny the motions for a stay. However, we instruct the parties 
to inform the Commission promptly of any court or administrative 
decision that might in any way relate to, or render moot, all or part 
of the instant proceeding. Similarly, if at any point the parties to 
this proceeding reach a settlement of this dispute, or if the transfer 
applicants decide to withdraw or postpone their application, we expect 
immediate notification to the Commission.

C. Applicants' Request To Deny Cortlandt's Hearing Motion on Procedural 
Grounds

    Applicants assert that Cortlandt's Motion for Hearing should be 
denied because Cortlandt failed to serve the applicants in a manner 
that ensured delivery on the due date of filing. See Answer to 
Cortlandt's Petition, dated Aug. 14, 2000, at 3-4. We consider such a 
sanction too severe for the offense. Cortlandt has acknowledged its 
error, apologized, and explained that it was based on a 
``communications error'' with the Commission's Office of the Secretary. 
See Cortlandt's Reply Brief, dated Aug. 21, 2000, at 8. Also, 
applicants do not appear to have suffered any prejudice as a result of 
Cortlandt's error. We therefore deny their motion.

D. CAN's Motion For a Formal Subpart G Hearing

    In both a separate motion and throughout its presentation on 
standing and issues, CAN requests a formal hearing under Subpart G of 
our procedural regulations. See CAN's Petition at 9-11, 22, 23, 29, 36, 
42, 47, 51, 55, 56, 64, 66; CAN's Reply Brief at 4-5, 9-10, 12. CAN's 
motion for a Subpart G proceeding is expressly prohibited under 10 CFR 
2.1322(d). See Vermont Yankee Nuclear Power Corp. (Vermont Yankee 
Nuclear Power Station, CLI-00-20, 52 NRC at ____, slip op. at 3 (Oct. 
6, 2000).
    In an effort to avoid this prohibition, CAN asserts that this 
proceeding falls within the bounds of 10 CFR 2.1329, providing for 
waiver of rules under ``special circumstances'' which demonstrate that 
the ``application of a rule or regulation would not serve the purposes 
for which it was adopted.'' As ``special circumstances,'' CAN points to 
the fact that ``the matters in this license transfer are not strictly 
`financial in nature' as contemplated in the promulgation of Subpart 
M.'' See CAN's Petition at 9.
    CAN's interpretation of the appropriate scope of Subpart M 
procedures is, in our view, overly restrictive. Our Subpart M rules are 
intended to apply to more than just those cases presenting only 
financial issues. We expected when promulgating Subpart M that most 
issues would be financial,\10\ and indeed this expectation has been 
fulfilled. However, we also predicted that petitioners would raise 
other categories of issues as well (such as foreign ownership, 
technical qualifications, and appropriate critical staffing levels)--a 
prediction that has also been fulfilled.\11\ For that reason, when 
promulgating Subpart M, we expressly declined to adopt the nuclear 
industry trade organization's suggestion that we limit the scope of 
Subpart M

[[Page 78201]]

proceedings to financial matters.\12\ We deny CAN's motion for 
essentially the same reason. The nature of petitioners' financial and 
technical allegations do not call for an alteration in the usual 
Subpart M process.
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    \10\ See Nine Mile Point, CLI-99-30, 50 NRC at 345.
    \11\ See Vermont Yankee, CLI-00-20, 52 NRC at ----, slip op. at 
11-14 (petitioners raised issues involving technical 
qualifications); Northern States Power Co. (Monticello Nuclear 
Generating Plant), CLI-00-14, 52 NRC 37 (2000) (petitioners raised 
issues regarding the proposed licensees' technical qualifications), 
reconsid'n denied, CLI-00-19, 52 NRC 135 (2000); Duquesne Light Co. 
(Beaver Valley Power Station, Units 1 and 2), CLI-99-23, 50 NRC 21 
(1999) (petitioner raised labor issues between union and management 
relating to plant safety); Duquesne Light Co. (Beaver Valley Power 
Station, Units 1 and 2), CLI-99-25, 50 NRC 224 (1999) (same).
    \12\ See Final Rule, ``Streamlined Hearing Process for NRC 
Approval of License Transfers,'' 63 Fed. Reg. 66,721, 66,724 (Dec. 
3, 1998).
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    As an alternative request, CAN moves for a consolidated hearing by 
the Commission, FERC and DEC. See CAN's Petition at 11; CAN's Reply 
Brief at 7-8. We believe holding a consolidated hearing would be 
impractical in the particular circumstances of this proceeding, given 
that each agency would be operating under a different set of procedural 
rules and governing statutes. Moreover, as indicated in footnote 7, 
supra, FERC has already concluded its parallel proceeding involving the 
FitzPatrick and Indian Point 3 plants.
    Finally, as a second alternative request, CAN asks that the 
Commission initiate a Subpart M hearing, but consider the possibility 
of converting it to a Subpart G hearing at a later date. See CAN's 
Reply Brief at 9. In our view, CAN is asking nothing more than the 
Commission's regulations already provide. See 10 CFR 2.1322(d) (``The 
Commission, on its own motion, or in response to a request from a 
Presiding Officer * * *, may use additional procedures, such as direct 
and cross-examination, or may convene a formal hearing under subpart G 
of this part on specific and substantial disputes of fact * * * that 
cannot be resolved with sufficient accuracy except in a formal 
hearing''). We deny CAN's second alternative request as unnecessary.

E. Petitioner' Request For Access to Unredacted Versions of Financial 
Information

    Cortlandt asserts that its lack of access to certain confidential 
financial information (e.g., the five-year estimates of Indian Point 
3's annual operating costs, the credit agreement, and the financial 
statements for Entergy International Ltd., Entergy Global Investments, 
LLC and Entergy Indian Point) precludes it from fully presenting its 
arguments. See Cortlandt's Petition at 8; Cortlandt's Supplemental 
Filing, dated July 31, 2000, at 3; Cortlandt's Reply Brief at 4-7. See 
generally Affirmation of Peter Henner at para. 10 (``materials made 
available in the public record are insufficient for an assessment of 
[Entergy Indian Point]'s ability [to] operate under the issued license 
and to restore the [Indian Point 3] site to greenfield status''); 
Letter from George E. Sansoucy to Paul V. Nolan, Esq., dated July 28, 
2000, at 1 (``Sansoucy Letter''), appended to Cortlandt's Supplemental 
Filing. More specifically, Cortlandt's expert notes that

    [I]t is not possible to render an opinion as to whether the 
income stream to Entergy will be sufficient to make the required 
payments. A particular problem is that the fuel payment stream cited 
in the application is for the combined fuel assets of [Indian Point] 
3 and James A. FitzPatrick Nuclear Generating Station and does not 
allocate the portion of payments assigned to each site [citing 
Purchase and Sale Agreement, p. 14].
    [I]t is not possible to estimate the ability of Entergy to fund 
required payments to the Decommissioning Fund.

See Sansoucy Letter at 2, 3. CAN similarly complains about lack of 
access to decommissioning documents. See, e.g., CAN's Petition at 3, 
11, 15; CAN's Reply Brief at 18.
    We find below that Cortlandt and CAN have made sufficient showings 
of standing and have raised admissible issues. We also recognize that 
the lack of access to the applicants' full financial information could 
affect their ability to present their substantive case at the hearing. 
E.g., pages 19, 22, 23, infra. Cortlandt and CAN (along with the 
Association and Westchester, if they wish) should discuss access to 
proprietary information with the applicants and thereafter file with 
the Presiding Officer a mutually-agreeable protective order. If the 
parties cannot agree on a protective order, CAN and Cortlandt may move 
for issuance of such an order.\13\ Moreover, we note that portions of 
the hearing (which we herein grant) may have to be closed to the public 
when issues involving proprietary information are being addressed.
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    \13\ See GPU Nuclear Inc. (Oyster Creek Nuclear Generating 
Station), CLI-00-6, 51 NRC 193, 211 (2000); North Atlantic Energy 
Serv. Corp. (Seabrook Station, Unit 1) & Northeast Nuclear Energy 
Co. (Millstone Station, Unit 3), CLI-99-27, 50 NRC 257, 268 (1999); 
North Atlantic Energy Serv. Corp. (Seabrook Station, Unit 1), CLI-
99-6, 49 NRC 201, 225 (1999); North Atlantic Energy Serv. Corp. 
(Seabrook Station, Unit 1), unpublished Protective Order of 
Presiding Officer, 1999 WL 202690 (March 24, 1999). Cf. 10 CFR 
2.740(c)(6).
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IV. Discussion

    To intervene as of right in any Commission licensing proceeding, a 
petitioner must demonstrate that its ``interest may be affected by the 
proceeding,'' i.e., it must demonstrate ``standing.'' See AEA, Section 
189a, 42 U.S.C. section 2239(a). The Commission's rules for license 
transfer proceedings also require that a petition to intervene raise at 
least one admissible issue. See 10 CFR 2.1306. For the reasons set 
forth below, we conclude that CAN, the Association and Cortlandt have 
demonstrated standing, and that Westchester is entitled to governmental 
participant status in this proceeding. We also conclude that CAN, the 
Association and Cortlandt have each raised at least one admissible 
issue. We therefore set the case for hearing.

A. Standing

    To demonstrate standing in a Subpart M license transfer proceeding, 
the petitioner must (1) identify an interest in the proceeding by
    (a) Alleging a concrete and particularized injury (actual or 
threatened) that
    (b) is fairly traceable to, and may be affected by, the challenged 
action (e.g., the grant of an application to approve a license 
transfer), and
    (c) is likely to be redressed by a favorable decision, and
    (d) lies arguably within the ``zone of interests'' protected by the 
governing statute(s).
    (2) specify the facts pertaining to that interest.
    See 10 CFR 2.1306, 2.1306; Nine Mile Point, CLI-99-30, 50 NRC at 
340-41 and n.5 (and cited authority). Moreover, an organization which 
seeks representational standing must demonstrate how at least one of 
its members may be affected by the licensing action, must identify that 
member by name and address, and must show (preferably by affidavit) 
that the organization is authorized to request a hearing on behalf of 
that member. See Vermont Yankee, CLI-00-20, 52 NRC at____, slip op. at 
4; Oyster Creek, CLI-00-6, 51 NRC at 202 (and cited authority).
1. CAN
    CAN seeks permission to represent the interests of two of its 
members--Linda Downing, who lives 5\1/2\ miles from the FitzPatrick 
plant, and Marilyn Elie, who lives the same distance from the Indian 
Point 3 plant. See Declaration of Linda Downing, dated July 31, 2000; 
Declaration of Marilyn Elie, dated July 31, 2000. On Ms. Downing's and 
Ms. Elie's behalf, CAN alleges potential health-and-safety impacts on 
them if the Commission approves the two license transfers, seeks 
specific relief to prevent such injuries (disapproval of the transfers 
or imposition of conditions), and asserts that the safety-related 
issues fall within the zone of interests protected by the AEA and the 
National Environmental Policy Act (``NEPA''). See CAN's Petition at 14, 
22, 28-29, 25-26, 34, 36, 40-41, 46-47, 50-51, 55-56, 63-64, 65-66; 
CAN's Reply Brief at 10-

[[Page 78202]]

11. We recently granted standing in the Vermont Yankee, Oyster Creek 
and Monticello license transfer proceedings to petitioners who (like 
CAN) raised similar assertions and who (again like CAN) were authorized 
to represent members living or active quite close to the site.\14\ 
Based on these similarities, we conclude that CAN has satisfied our 
standing requirements and is granted standing with respect to both the 
FitzPatrick and Indian Point 3 license transfers.
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    \14\ See Vermont Yankee, CLI-00-20, 52 NRC at ____, slip op. at 
4-5; Oyster Creek, CLI-00-6, 51 NRC at 202-03; Monticello, CLI-00-
14, 52 NRC at 47.
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2. The Association
    The Association is a group of about 400 technical and management 
employees (e.g., reactor operators, reactor engineers) in the nuclear 
generation component of PASNY.\15\ The Association is concerned that 
the proposed transfer will directly and materially affect (and, in 
fact, is already affecting) its members' morale and economic interests 
(salaries, benefits, pensions), as well as their working conditions, 
professional roles and safety culture--factors the Association believes 
will affect performance, attrition and operational safety at the two 
plants. The Association also argues that its members' health and safety 
may suffer as a direct result of the license transfer if an 
insufficient amount of revenue were to preclude the Entergy companies 
from adequately funding both occupational radiation protection and safe 
decommissioning activities. See Association's Petition at 17; 
Association's Reply Brief at 7-8, 25-26. The Association supports its 
assertions with notarized affirmations of the three individual 
petitioners, and it requests both intervenor status and a hearing. As 
relief, it seeks an order declining to approve the license transfer.
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    \15\ Messrs. Carano and Pulcher (both cosignatories on the 
Association's Petition to Intervene and Request for Hearing) are 
managers at the Indian Point 3 plant; Mr. Wiese (also a cosignatory) 
is a manager at the FitzPatrick plant. See Association's Petition at 
2-6.
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    The Association's submission satisfies our standing requirements. 
Given that we have found that people (like CAN's members here) living 
or active within a few miles of a nuclear plant have shown standing in 
license transfer cases, it follows that employees who work inside a 
plant should ordinarily be accorded standing as well, as long as the 
alleged injury is fairly traceable to the license transfer. Here the 
Association has made a sufficient linkage to establish standing. The 
Association's concerns, if substantiated at a hearing, would be 
redressed by a favorable decision, i.e., a decision declining to 
approve the transfer.
3. Local Governmental Entities
    Cortlandt and the Hendrick Hudson School District collectively seek 
standing in the Indian Point 3 license transfer proceeding on the 
grounds that the Indian Point 3 plant is located within the boundaries 
of both governmental entities and that the plant's safe operation and 
decommissioning is of great concern to the safety and long-term 
economic well-being of the Town and School District communities. We 
find that, for these reasons, Cortlandt has demonstrated standing with 
respect to the Indian Point 3 license transfer application. See Vermont 
Yankee, CLI-00-20, 52 NRC at ____, slip op. at 5. Moreover, Cortlandt 
is the locus of the Indian Point 3 plant and therefore is in a position 
analogous to that of an individual living or working within a few miles 
of a plant whose license may be transferred. See discussion of CAN's 
standing, at page 14, supra.
    Westchester, the County where the Indian Point 3 plant is located, 
seeks participant (but not intervenor) status in this proceeding, 
citing 10 CFR 2.715(c). See Westchester's Petition, dated July 31, 
2000, at 2-3. As we indicated in Nine Mile Point, CLI-99-30, 50 NRC at 
344, ``the Commission has long recognized the benefits of participation 
in our proceedings by representatives of interested states, counties, 
municipalities, etc.'' We therefore grant Westchester's request for 
participant status regarding the Indian Point 3 license transfer.

B. Admissibility of Issues

    To demonstrate that issues are admissible under Subpart M, a 
petitioner must
(1) Set forth the issues (factual and/or legal) that petitioner seeks 
to raise,
(2) demonstrate that those issues fall within the scope of the 
proceeding,
(3) demonstrate that those issues are relevant and material to the 
findings necessary to a grant of the license transfer application,
(4) show that a genuine dispute exists with the applicant regarding the 
issues, and
(5) provide a concise statement of the alleged facts or expert opinions 
supporting petitioner's position on such issues, together with 
references to the sources and documents on which petitioner intends to 
rely.
    See 10 CFR 2.1308; Nine Mile Point, CLI-99-30, 50 NRC at 342 (and 
cited authority). These standards do not allow mere ``notice 
pleading;'' the Commission will not accept ``the filing of a vague, 
unparticularized'' issue, unsupported by alleged fact or expert opinion 
and documentary support. See Seabrook, CLI-99-6, 49 NRC at 219 
(citation and internal quotation marks omitted). General assertions or 
conclusions will not suffice. This is not to say, however, that our 
threshold admissibility requirements should be turned into a ``fortress 
to deny intervention.'' Cf. Duke Energy Corp. (Oconee Nuclear Station, 
Units 1, 2, and 3), CLI-99-11, 49 NRC 328, 335 (1999), quoting 
Philadelphia Elec. Co. (Peach Bottom Atomic Power Station, Units 2 and 
3), ALAB-216, 8 AEC 13, 20-21 (1974).
1. General Concerns
    We initially touch on two general concerns raised by the 
Association and CAN. The first is a claimed decline in the educational 
opportunities and talent necessary for an effective nuclear workforce 
in the United States. See Association's Petition at 19-20. The second 
is an alleged over-concentration in the ownership of nuclear power 
plants. See CAN's Petition at 12-18. These may well be significant 
questions warranting Commission inquiry. Indeed, as we recently pointed 
out in Vermont Yankee, the NRC staff, at Commission direction, already 
is examining the industry consolidation question. See CLI-00-20, 52 NRC 
at__, slip op. at 17. But an individual license transfer adjudication 
is not an appropriate forum for a legislative-like inquiry into issues 
affecting the entire nuclear industry. See id. We therefore decline to 
admit for hearing petitioners' general issues on a declining nuclear 
workforce and on overly concentrated ownership.\16\
---------------------------------------------------------------------------

    \16\ Entergy's acquisition of the Indian Point and FitzPatrick 
plants, if the proposed deals are consummated, would give the 
``Entergy family'' control over approximately 7.9 nuclear plants. If 
Entergy then merges with the FPL Group and purchases the Indian 
Point 2 facility, as has been proposed, the Entergy conglomerate 
will then control 12.75 nuclear power plants. To place this in 
perspective, Commonwealth Edison historically (and currently) has 
held an ownership interest in 12.5 plants. See Vermont Yankee, CLI-
00-20, 52 NRC at____, slip op. at 20 n.20. There are over 100 
nuclear power reactor units in the United States. Petitioners have 
not explained why adding two reactors to Entergy's current fleet, in 
and of itself, poses a unique health and safety risk warranting an 
adjudicatory hearing.
---------------------------------------------------------------------------

2. Financial Qualifications Issues
    Cortlandt and CAN question whether Entergy FitzPatrick and Entergy 
Indian Point will have the necessary level of financial qualifications 
to run the FitzPatrick and Indian Point 3 plants safely. See 
Cortlandt's Petition at 5-6;

[[Page 78203]]

CAN's Petition at 54-55. We admit Cortlandt's issue as discussed below 
insofar as it argues that Entergy Indian Point's potential joint and 
several liability for Entergy FitzPatrick's fuel and plant purchase 
expenses could draw into question the ``reasonable assurance'' that 
Entergy Indian Point has ``the funds necessary'' to operate the Indian 
Point plant safely. See 10 CFR 50.33(f)(2). In addition, we give 
Cortlandt and CAN an opportunity to formulate a challenge to Entergy's 
cost-and-revenue projections for both plants, after a protective order 
is entered making Entergy's confidential financial data available. See 
generally Seabrook, CLI-99-6, 49 NRC at 219-21. We turn now, briefly, 
to petitioners' specific claims.
    a. Joint and Several Liability. Cortlandt asserts that several of 
the agreements underlying the transfer impose liability on Entergy 
Indian Point for certain financial obligations of Entergy FitzPatrick. 
See Cortlandt's Petition at 6-8 and Affirmation of Peter Henner at 
para. 14, both of which refer to a $586 million Facilities Payment Note 
(Exh. A to Indian Point Application) and a $171 million Fuel Payment 
Note (Exh. B to Indian Point 3 Application). Cortlandt is worried that 
these joint and several liability obligations would place the Indian 
Point 3 plant in financial jeopardy in the event of an accident at 
either Indian Point 3 or FitzPatrick.
    Such financial jeopardy could, according to Cortlandt, leave the 
Indian Point plant in an unsafe condition which would place at risk 
both the environment and the public health. See Cortlandt's Petition at 
7; Cortlandt's Supplemental Filing at 3; Affirmation of Peter Henner at 
Paras.  13, 60. In support, Cortlandt points to the fact that Entergy 
Indian Point has agreed to sell its entire output of electricity to 
PASNY for 3.6 cents per kilowatt-hour through 2004--a revenue level 
Cortlandt considers sufficient to cover Unit 3's operating costs, but 
insufficient to simultaneously satisfy any obligations arising from 
activities at the FitzPatrick plant. See Affirmation of Peter Henner at 
para. 15. According to Cortlandt, the problem is exacerbated by the 
Entergy companies' ostensible failure to allocate between the Indian 
Point 3 and FitzPatrick plants the payment for those plants' combined 
fuel assets.\17\
---------------------------------------------------------------------------

    \17\ See Affirmation of Peter Henner at para. 17. See also 
Sansoucy Letter at 2 (``[I]t is not possible to render an opinion as 
to whether the income stream to Entergy will be sufficient to make 
the required payments. A particular problem is that the fuel payment 
stream cited in the application is for the combined fuel assets of 
[Indian Point] 3 and James A. FitzPatrick Nuclear Generating Station 
and does not allocate the portion of payments assigned to each site 
[citing Purchase and Sale Agreement, p. 14].''
---------------------------------------------------------------------------

    The applicants respond only briefly to this general line of 
argument, stating merely that Cortlandt's assertions of joint and 
several liability are vague and baseless. See Answer to Cortlandt's 
Petition at 13-14. We disagree with the applicants.\18\ Cortlandt 
points specifically to two financial obligations (the Facilities 
Payment Note and the Fuel Payment Note) as sources of joint and several 
liability and asserts that PASNY's 3.6 cent per kilowatt hour payments 
would be insufficient to satisfy the transferees' obligations at both 
FitzPatrick and Indian Point 3. Moreover, Cortlandt's expert (Mr. 
Sansoucy) concludes that the estimated net operating income from Indian 
Point 3 for the next seven years would, under certain assumptions, be 
insufficient to cover the facility and fuel payments during that time. 
See Sansoucy Letter at 2. These allegations, backed by an expert's 
affidavit, create a genuine dispute warranting a hearing.\19\
---------------------------------------------------------------------------

    \18\ We do, however, agree with the applicants on one point. We 
see no factual basis (e.g., affidavits or other documents) in the 
record for Cortlandt's assertion regarding the inadequacy of 
Entergy's proposed $50 million letter of credit. See Cortlandt's 
Petition at 7. This aspect of the financial qualifications issue is 
therefore not admitted for hearing.
    \19\ See Yankee Atomic Elec. Co. (Yankee Nuclear Power Station), 
CLI-96-7, 43 NRC 235, 249 (1996) (citations and internal quotation 
marks omitted):
    Although section 2.714 imposes on a petitioner the burden of 
going forward with a sufficient factual basis, it does not shift the 
ultimate burden of proof from the applicant to the petitioner. Nor 
does section 2.714 require a petitioner to prove its case at the 
contention stage. For factual disputes, a petitioner need not 
proffer facts in formal affidavit or evidentiary form, sufficient to 
withstand a summary disposition motion. On the other hand, a 
petitioner must present sufficient information to show a genuine 
dispute and reasonably indicating that a further inquiry is 
appropriate.
---------------------------------------------------------------------------

    b. Limited Liability Corporation. As a second line of argument 
regarding financial qualifications, Cortlandt asserts that Entergy 
Indian Point, as a limited liability company, may not have the 
necessary resources to protect the environment and meet its legal, 
contractual and regulatory obligations to its employees, PASNY 
(pursuant to the Indian Point 3 and FitzPatrick sales contracts), and 
those who may be injured or suffer property damage in a nuclear 
accident. See Affirmation of Peter Henner at para. 25(e). Cortlandt 
anticipates that Entergy Indian Point could lack the necessary 
resources to respond to these obligations if it were to face an 
accident, a shortfall in operating revenue due to fluctuations in the 
market, or changes in the energy market or in the cost of producing 
nuclear power. See Affirmation of Peter Henner at para. 54. Cortlandt 
asserts that the newly-formed Entergy Indian Point should be subject to 
the stricter financial requirements of 10 CFR 50.33(f)(3) and (4). See 
Affirmation of Peter Henner at para. 53.
    Cortlandt acknowledges that we have issued reactor operating 
licenses to limited liability corporations in the past and that we have 
recently approved a transfer of such a license to an LLC whose only 
asset was the generating facility. See Affidavit of Peter Henner at 
para. 55, citing Oyster Creek, CLI-00-6, 51 NRC at 208. However, 
Cortlandt considers Oyster Creek factually distinguishable inasmuch as 
the transferor in that proceeding was an investor-owned utility while 
the transferor in the instant proceeding is a public entity. See 
Affirmation of Peter Henner at para. 59. Cortlandt also considers 
Oyster Creek to have been wrongly decided and argues that it creates a 
``fortress to deny intervention.'' See Affirmation of Peter Henner at 
para. 62.
    We decline to admit this issue. The applicants have already 
provided the financial data called for by the requirements of 10 CFR 
50.33(f)(3) and (4). Moreover, Cortlandt has offered us no convincing 
reason to reconsider our legal ruling in Oyster Creek,\20\ and we find 
equally unconvincing its effort to distinguish that case factually. The 
issue at bar is the financial qualifications of the transferee. 
Cortlandt has not explained why the public status of the transferor is 
relevant to this issue.
---------------------------------------------------------------------------

    \20\ We recently reaffirmed our Oyster Creek holding. See 
Monticello, CLI-00-14, 52 NRC at 57.
---------------------------------------------------------------------------

    c. Baseline Funding. CAN contends that we should decline to approve 
the license transfers until Entergy FitzPatrick and Entergy Indian 
Point, together with their parent corporations, establish ``baseline 
funding'' that is clearly defined and substantially increased over the 
current level. See CAN's Petition at 54. This general line of argument 
is quite similar (and, in some cases, identical) to an issue raised by 
CAN in Vermont Yankee. As we noted in that decision, CAN ``nowhere 
defines the term [`baseline funding']; nor is it a term with which we 
are familiar.'' See CLI-00-20, 52 NRC at ____, slip op. at 16. However, 
from the context of CAN's references to baseline funding, it appears in 
the instant proceeding that CAN is referring to the $90 million line of 
credit that the Entergy companies are offering as supplemental funding, 
if necessary. For the reasons set forth below, we find that CAN has 
failed to provide an adequate basis for most of this issue, but may

[[Page 78204]]

submit a revised issue regarding one facet of the ``baseline funding'' 
question within twenty days of issuance of a protective order that 
provides CAN access to the applicants' proprietary information.
    CAN initially argues that the applicants have failed to explain 
whether the $50 million letter of credit from Entergy Global 
Investments, Inc., is to support all of Entergy's current nuclear 
holdings and future acquisitions, and whether those funds are 
immediately available to Entergy FitzPatrick and Entergy Indian Point 
or whether instead they are available only upon repayment of a $50 
million letter of credit from Entergy Corp. See CAN's Petition at 54-
55. In response, the applicants explain that the Entergy Corp.'s $50 
million line of credit is part of the $90 million supplemental funding 
that various Entergy companies are making available to meet 
contingencies for both Entergy FitzPatrick and Entergy Indian Point. 
The funds, according to the applicants, are not available to the entire 
fleet of Entergy reactors. See Answer to CAN's Petition at 26 n.20. In 
our view, the applicants' explanation fills the informational gap about 
which CAN complains, leaving no ``genuine dispute'' on this point. See 
10 CFR 2.1306(b)(2)(iv). We therefore do not admit this portion of 
CAN's ``baseline funding'' issue.\21\
---------------------------------------------------------------------------

    \21\ Entergy Global Investments, Inc., has offered two $20 
million lines of credit to Entergy FitzPatrick and Entergy Indian 
Point, respectively. However, contrary to CAN's representations, it 
has not issued a $50 million dollar letter of credit.
---------------------------------------------------------------------------

    CAN next argues that (a) neither FitzPatrick nor Indian Point 3 has 
ever met, on a sustained basis, the revenue generation standards 
required under the Purchase and Sale Agreement; (b) maintenance outage 
costs could easily exceed the $90 million in supplemental funding 
available to the two plants; and therefore (c) the applicants must 
provide additional assurance as to the health and safety of both the 
workers and the public. See CAN's Petition at 55. Applicants respond 
that CAN has provided no affidavits, supporting documents or other 
evidence to support this claim. See Answer to CAN's Petition at 26. 
However, CAN explains that the applicants' exclusion of certain 
financial information from the two applications precludes CAN from 
comparing the anticipated operating costs with the anticipated revenues 
and thereby assessing the transferees' ability to plan for maintenance 
outages or to build up sufficient funds for unexpected outages. See 
CAN's Reply Brief at 18.
    Regarding part (b) of this argument, the ``sufficiency'' vel non of 
the $90 million supplemental funding does not constitute grounds for a 
hearing. In Vermont Yankee, we recently declined to admit essentially 
the same issue (also raised by CAN) on the ground that NRC rules do not 
mandate supplemental funding. ``The parent company guarantee is 
supplemental information and not material to the financial 
qualifications requirements of 10 CFR 50.33(f)(2).'' \22\ CAN has given 
us no reason to reach a different conclusion in the instant proceeding.
---------------------------------------------------------------------------

    \22\ See CLI-00-20, 52 NRC at ____, slip op. at 21-22, citing 
Oyster Creek, CLI-00-6, 51 NRC at 205. See also Vermont Yankee, CLI-
00-20, 52 NRC at ____, slip op. at 25:
    [A]lthough AmerGen's $200 million reserve fund provides 
significant assurance of sufficient operating and decommissioning 
funds in the event of a problem, the fund is not, strictly speaking, 
required by our rules. It therefore lies outside the bounds of our 
license transfer hearing process--which focuses on whether AmerGen 
Vermont meets the required financial and technical qualifications.
---------------------------------------------------------------------------

    Regarding the remainder of CAN's argument, however, we reach a 
somewhat different conclusion. CAN's claim of revenue shortfalls 
essentially challenges the Entergy companies' cost and revenue 
projections--precisely the kind of challenge we have indicated would be 
acceptable if based on sufficient facts, expert opinion or documentary 
support. See Oyster Creek, CLI-00-6, 51 NRC at 207, 208, citing 
Seabrook, CLI-99-6, 49 NRC at 219-21. In fact, we have already ruled 
that Cortlandt's somewhat different financial qualifications issue 
meets our threshold requirements for a hearing. It is true that CAN's 
version of the issue appears only in its Petition, without back-up 
support. However, we believe that CAN's explanation regarding the 
unavailability of relevant data entitles it to gain access to the data 
through a protective order (see page 12, supra) before being held to 
our usual specificity requirements.\23\ The same is true of Cortlandt 
insofar as it also chooses to challenge Entergy's cost-and-revenue 
projections. We therefore authorize CAN and Cortlandt to submit a 
properly formulated and supported financial qualifications issue within 
20 days of the entry of a protective order.
---------------------------------------------------------------------------

    \23\ Subpart M calls for ``specificity'' in pleadings. See 
Northeast Nuclear Energy Co. (Millstone Nuclear Power Station, Units 
1, 2, and 3), CLI-00-18, 52 NRC 129, 131-32 (2000). However, in the 
unusual setting here, where critical information has been submitted 
to the NRC under a claim of confidentiality and was not available to 
petitioners when framing their issues, it is appropriate to defer 
ruling on the admissibility of an issue until the petitioner has had 
an opportunity to review this information and submit a properly 
documented issue.
---------------------------------------------------------------------------

    We caution CAN, and Cortlandt as well, that ``absolute certainty'' 
in financial forecasts is impossible, and that we do not require it. 
See Seabrook, CLI-99-6, 49 NRC at 221-22. Challenges to Entergy's 
financial qualifications ``ultimately will prevail only if [they] can 
demonstrate relevant uncertainties significantly greater than those 
that usually cloud business outlooks.'' Id. at 222.
    Finally, CAN asserts that Entergy's supplemental $90 million will 
prove inadequate to cover Entergy's various potential liabilities, 
including its Price-Anderson Act responsibility. We have already 
explained why the $90 million in supplemental funds is not part of this 
license transfer case. And, in our recent Vermont Yankee decision, we 
rejected an identical Price-Anderson claim by CAN:

    [N]othing about Price-Anderson coverage changes as a result of 
this license transfer. The same coverage will exist after license 
transfer as exists today. Moreover, contrary to what CAN suggests, 
Price-Anderson indemnification agreements continue in effect even 
after plants have ceased permanent operation and are engaged in 
decommissioning. See 10 CFR 140.92 (NRC Indemnification Agreement, 
Article VII); 10 CFR 50.54(w). Thus, CAN's Price-Anderson argument 
is ill-conceived. . . .\24\
---------------------------------------------------------------------------

    \24\ CLI-00-20, 52 NRC at ____, slip op. at 22. In that same 
decision, we further commented on the analogous Price-Anderson 
argument of another petitioner (Vermont) that:
    . . . our regulations only require it to show that it has 
sufficient cash equivalents (such as the parent company guarantee) 
to cover the retroactive $10 million premium required by our 
regulations at 10 CFR 140.21(e)-(f). See Oyster Creek, CLI-00-6, 51 
NRC at 206. . . . Vermont's argument that the applicant must meet 
financial requirements in addition to those imposed by our 
regulations constitutes, in effect, a demand for additional rules, 
but it does not provide an adequate basis for a hearing. Id. 
Moreover, * * *, prior to issuance of the amended license to AmerGen 
Vermont, it must obtain all regulatorily-required property damage 
insurance.
---------------------------------------------------------------------------

    In sum, we will consider a revised issue submitted by CAN regarding 
the applicants' cost and revenue projections, but we reject CAN's 
claims regarding the $90 million supplemental fund and the Price-
Anderson Act.
3. Decommissioning Issues
    a. Consistency of Decommissioning Funding Arrangement with 10 CFR 
50.75. As explained at pages 5-6, supra, the applicants have structured 
an unusual arrangement whereby the transferor (PASNY) keeps the 
decommissioning fund after transferring the FitzPatrick and Indian 
Point 3 plants to the Entergy companies. Ordinarily, a transferee would 
receive the decommissioning fund along with the nuclear plant with 
which it was associated.
    The Association raises the question whether the applicant's 
arrangement is

[[Page 78205]]

consistent with the Commission's own decommissioning requirements of 10 
CFR 50.75(e) which, according to the Association, requires the 
transferee (here, the Entergy companies) to hold the decommissioning 
funds. See Association's Petition at 18; Affidavit of Stephen Prussman. 
The Association disputes applicants' claim that the license transfer 
request meets the requirements of 10 CFR 50.75(e)(1)(vi), i.e., that 
the applicant provide financial assurance ``equivalent'' to that 
offered by the decommissioning devices (e.g., a surety or insurance 
arrangement) specified in the earlier portions of section 50.75(e)(1). 
In support, the Association asserts that outstanding questions of tax 
liability limit the availability of the decommissioning funds and also 
that the applicants impose various contractual limitations upon the 
availability of the funds (i.e., limits based upon plants owned, limits 
on the Authority's liability, and provisions to pay less than the full 
decommissioning funding). See Prussman Affidavit at 2. The Association 
also asserts that the arrangement contravenes 10 CFR 50.75(e)(1)(v), 
which specifies that the terms of the contract must be with the 
licensee's customers and include provisions that the electricity buyers 
will pay for decommissioning. See Prussman Affidavit at 2.
    At bottom, the issue here is whether the applicants' financial 
assurance arrangement is lawful under 10 CFR 50.75 and the 
``equivalent'' of those otherwise prescribed in the regulations (10 CFR 
50.75(e)(1)(i)-(v)). The issue raises genuine disputes of law and fact 
and we admit it for hearing.\25\ We now move to the remaining 
decommissioning issues. None of these is admissible.
---------------------------------------------------------------------------

    \25\ CAN raises related issues: whether NRC approval of the 
transfers will deprive the Commission of authority to require PASNY 
to conduct remediation under decommissioning, and whether, under 
those circumstances, PASNY would no longer have access to the 
decommissioning trust fund for the remediation it would need to 
complete. See CAN's Reply Brief at 14. These issues relate to the 
admitted issue involving 10 CFR 50.75, supra, and CAN may address 
them at the hearing in that context.
    CAN and the Association should be aware, however, that the 
decommissioning trust agreement has been modified somewhat by the 
NRC staff's November 9, 2000 orders. See both Staff Orders at 6 
para. 9.
---------------------------------------------------------------------------

    b. Commitment and Ability to Decommission Indian Point 3 to 
Greenfield Condition. Cortlandt's first substantive issue regarding 
decommissioning funding is whether the Entergy companies are both 
committed and financially able to decommission the Indian Point 3 
facility to ``greenfield'' condition \26\ and thereby give Cortlandt 
the benefits of the greenfield decommissioning of not only Unit 3 but 
also Units 1 and 2 (whose decommissioning awaits the decommissioning of 
Unit 3).\27\
---------------------------------------------------------------------------

    \26\ See Cortlandt's Petition at 8; Cortlandt's Supplemental 
Filing at 2; Affirmation of Peter Henner at para.9, 26(a), 31-32, 
35-36, 52, 61; Sansoucy Letter at 4. Cortlandt is particularly 
concerned about whether the transferees have the financial ability 
to remove permanently the spent fuel rods from the site upon 
decommissioning, without using dry cask storage. See Affirmation of 
Peter Henner at para. 12; Sansoucy Letter at 3; Cortlandt Verified 
Petition at 16. PASNY estimates that the fund for decommissioning 
both the FitzPatrick and Indian Point 3 plants will contain $1.9 
billion at the time of license expiration. See Cortlandt Verified 
Petition at 11.
    \27\ See Affirmation of Peter Henner at para. 7. Although it is 
less than clear, Cortlandt appears to argue that the full 
decommissioning of Indian Point Unit 1 was postponed to coincide 
with the decommissioning of Units 2 and 3. See Affirmation of Peter 
Henner at Paras. 43-46; Cortlandt's Reply Brief at 14. Units 1 and 2 
are not owned by PASNY and are not the subject of this proceeding.
---------------------------------------------------------------------------

    Concerning the Entergy companies' commitment, Cortlandt maintains 
that the transfer documents do not commit Entergy Indian Point to 
greenfield decommissioning, even though the planning for greenfield 
decommissioning must begin soon if it is to be achieved.\28\ Cortlandt 
does not trust Entergy Indian Point, as a for-profit entity, to spend 
more than the minimum amount possible to decommission the facility, 
even if this means decommissioning it to less than greenfield 
conditions.\29\
---------------------------------------------------------------------------

    \28\ See Affirmation of Peter Henner at para. 35.
    \29\ See Affirmation of Peter Henner at Paras. 36, 41; Cortlandt 
Verified Petition at 11.
---------------------------------------------------------------------------

    Concerning the Entergy companies' ability to fund decommissioning, 
Cortlandt questions the adequacy of the decommissioning fund in light 
of Entergy Indian Point's joint and several liability for Entergy 
FitzPatrick's obligations.\30\ It also challenges the applicants' 
reliance on the decommissioning cost estimate established in the NRC's 
regulations, arguing that the actual costs may be higher than the 
regulations envision.\31\ Cortlandt objects that the applicants have 
not made enough information available for Cortlandt to determine the 
sufficiency of the decommissioning fund.\32\ Cortlandt explains that 
``greenfielding'' is particularly important to it because the plant 
property is a prime area for either residential/commercial development 
or recreational use.\33\
---------------------------------------------------------------------------

    \30\ See Cortlandt's Reply Brief at 11.
    \31\ See Cortlandt's Reply Brief at 11-12.
    \32\ See Cortlandt's Petition at 8; Cortlandt's Supplemental 
Filing at 3.
    \33\ See Affirmation of Peter Henner at para. 33; Cortlandt 
Verified Petition at 10.
---------------------------------------------------------------------------

    The principal difficulty Cortlandt faces with this issue is that 
our regulations do not require Entergy Indian Point to decommission the 
plant to greenfield condition. Although Cortlandt may have grounds for 
an action in a State Court against PASNY for breach of a contractual 
commitment to return the facility land to greenfield condition,\34\ 
Cortlandt has provided no basis for us to question Entergy Indian 
Point's ability or willingness to comply with the NRC's decommissioning 
requirements.
---------------------------------------------------------------------------

    \34\ See note 6, supra. Cortlandt refers to a ``social compact'' 
between Cortlandt and PASNY. According to Cortlandt, PASNY agreed in 
this compact to decommission Indian Point Units 1, 2 and 3 to 
greenfield condition in return for Cortlandt agreeing to permit the 
siting of Indian Point 3 at its current location. See Cortlandt's 
Reply Brief at 10-11. Similarly, Cortlandt asserts that ``[t]he 
monies in the decommissioning fund were contributed based on 
[PASNY's] commitment to the surrounding community, including 
[Cortlandt], to restore the site to greenfield conditions.'' 
Cortlandt asserts that the applicants cannot legitimately argue that 
greenfielding is beyond the scope of the transfer proceeding yet, at 
the same time, transfer the money that was placed in the 
decommissioning fund on the understanding that it would be used to 
``greenfield'' the site. See Cortlandt's Reply Brief at 15.
---------------------------------------------------------------------------

    Cortlandt's argument has other flaws as well. Its challenge to the 
applicants' use of the very decommissioning cost estimate methodology 
sanctioned by our rules amounts to an impermissible collateral attack 
on 10 CFR 50.75.\35\ Cortlandt has not attempted to justify a waiver 
here of our rule prohibiting such attacks. See 10 CFR 2.1329. Notably, 
the fund's current assets exceed regulatory requirements.\36\ Finally, 
the decommissioning funds are held in a special fund, separate and 
apart from Entergy Indian Point's other assets, and are therefore 
unaffected by any joint and several liability that Entergy Indian Point 
may have for the obligations of Entergy FitzPatrick.
---------------------------------------------------------------------------

    \35\ See Vermont Yankee, CLI-00-20, 52 NRC at __, slip op. at 8. 
CAN also challenges Entergy's use of our generic decommissioning 
cost formula. See CAN's Petition at 18-23; CAN's Reply Brief at 12-
13. For the reasons we gave in Vermont Yankee, 52 NRC at __, slip 
op. at 8, we find CAN's claim inadmissible.
    \36\ As we indicated in Seabrook, CLI-99-6, 49 NRC at 218 n.9, 
power reactor licensees will occasionally set aside more funds than 
the NRC requires--generally to cover activities such as the removal 
and subsequent disposal of spent fuel or non-radioactive structures 
and materials beyond the level necessary to reduce residual 
radioactivity to the levels required under our regulations. 
Moreover, other governmental agencies, such as the FERC and state 
public utilities commissions, may also impose funding requirements 
which licensees may have to satisfy, over and above those of the 
NRC.
---------------------------------------------------------------------------

    For the reasons set forth above, this issue is not admissible.
    c. Extension or Renewal of Indian Point 3 License. Cortlandt's next 
substantive issue is whether the Entergy

[[Page 78206]]

companies would seek to extend or renew the Indian Point 3 operating 
license (which expires in 2015) \37\ and thereby delay Cortlandt's 
enjoyment of the full panoply of health-and-safety benefits associated 
with the expected decommissioning of all three units.\38\ Specifically, 
Cortlandt refers to its expectations that PASNY would dismantle and 
move the facility (i.e., Unit 3) offsite and that any onsite storage of 
spent fuel by PASNY would be of limited duration.\39\ Cortlandt claims 
that any delay in decommissioning Unit 3 (and any consequent 
postponement of the decommissioning of Units 1 and 2) will adversely 
affect Cortlandt's health and safety interests \40\ by subjecting 
Cortlandt and its citizens to the possibility of increased radiological 
exposure as a result of both the continued operation of the plant and 
the continued (and possibly expanded) onsite storage of spent fuel.\41\ 
By contrast, Cortlandt expects Entergy Indian Point, as a for-profit 
entity, to run the plant as long as possible, in order to continue 
generating revenue.\42\ For this reason, Cortlandt asserts that, with 
the time for decommissioning planning so near, the NRC staff's 
assessment of financial ability must not be truncated, but should 
instead include an evaluation of the transferees' ability to 
decommission Indian Point 3--both as currently licensed and as that 
license may be renewed or extended.\43\
---------------------------------------------------------------------------

    \37\ See Affirmation of Peter Henner at para. 3. Cortlandt 
explains that certain other Entergy companies are already in the 
process of renewing the licenses of other nuclear plants (e.g., 
Arkansas One), thereby purportedly increasing the likelihood that 
Entergy Indian Point would likewise seek to renew the Indian Point 3 
license. See Affirmation of Peter Henner at 25(b).
    Along similar lines, Cortlandt also asks the Commission to 
consider the impact of the proposed transfers on possible requests 
for extensions and/or renewals of the licenses for Unit 2 at Indian 
Point. See Cortlandt's Petition at 8-9; Cortlandt's Supplemental 
Filing at 2, 4. Cortlandt explains that the operating license for 
this unit expires in 2013. See Affirmation of Peter Henner at para. 
3. According to Cortlandt, the instant license transfer application 
will affect whether and by whom a future application for license 
renewal is ultimately made. See Affirmation of Peter Henner at para. 
39.
    \38\ See Affirmation of Peter Henner at para. 6, 7, 11, 44; 
Cortlandt's Supplemental Filing at 3; Cortlandt's Reply Brief at 12-
14. Cortlandt explains that Indian Point Unit 1 has not been an 
operating facility since 1974 but has yet to be fully decommissioned 
(see Affirmation of Peter Henner at para. 3) and claims that 
Consolidated Edison Inc. of New York (``ConEd,'' the owner of Indian 
Point Units 1 and 2) has committed to decommission its units for 
unrestricted use at the same time as PASNY decommissions Unit 3 for 
unrestricted use. See Cortlandt's Petition at 8-9; Cortlandt's 
Supplemental Filing at 2, 4.
    \39\ See Cortlandt's Petition at 5; Cortlandt's Supplemental 
Filing, at 4; Cortlandt Verified Petition at 16.
    \40\ See Affirmation of Peter Henner at para. 11.
    \41\ See Affirmation of Peter Henner at Paras. 25(b), 34; 
Cortlandt Verified Petition at 16.
    \42\ See Affirmation of Peter Henner at Paras. 36, 40; Cortlandt 
Verified Petition at 11.
    \43\ See Affirmation of Peter Henner at para. 6; Cortlandt's 
Reply Brief at 12-14.
---------------------------------------------------------------------------

    These concerns do not fall within the scope of this license 
transfer proceeding. Entergy Indian Point does not here seek in its 
application to renew or extend the Indian Point 3 operating license, 
nor does its pending application assume such a request. Moreover, a 
request to renew or extend the license would seem just as likely from 
PASNY as from Entergy Indian Point, assuming the plant remains 
profitable. Finally, in posing this issue, Cortlandt overlooks its 
right to seek intervenor status in any application for license renewal 
or license extension that Entergy Indian Point may file. These grounds 
for rejection apply equally to Cortlandt's concerns regarding delayed 
decommissioning of the three units, the resulting need both to store 
additional spent fuel onsite during the plant's extended life and the 
resulting need to continue the storage of current spent fuel for a 
longer time than Cortlandt had anticipated.\44\
---------------------------------------------------------------------------

    \44\ See Cortlandt's Petition at 5; Cortlandt's Supplemental 
Filing at 4; Affirmation of Peter Henner at Paras. 11-13, 61; 
Sansoucy Letter at 3; Cortlandt Verified Petition at 16; Cortlandt's 
Reply Brief at 12, 14.
---------------------------------------------------------------------------

    In a related vein, Cortlandt expresses concern that the Indian 
Point 3 facility will be used as a temporary repository for spent fuel 
from other nuclear facilities owned by the Entergy family of 
companies.\45\ This is pure speculation. The transfer application does 
not seek such authority, and the Indian Point 3 facility could not 
accept spent fuel from other facilities without transshipment license 
authority. Should Entergy ever seek such authority, Cortlandt would 
have the right to seek intervenor status.
---------------------------------------------------------------------------

    \45\ See Affirmation of Peter Henner at para. 25(c); Cortlandt 
Verified Petition at 16.
---------------------------------------------------------------------------

    d. Management of Indian Point 3 Decommissioning Fund. Cortlandt 
next questions whether sufficient controls exist regarding the 
management of the decommissioning fund.\46\ It suggests that the 
decommissioning agreements contain ill-defined and uncertain 
liabilities for the public, and expresses concern that any such 
additional liabilities or costs incurred by PASNY will have to be 
absorbed either by PASNY customers or the New York taxpayers.\47\ Also, 
Cortlandt (through its expert, Mr. Sansoucy) claims that PASNY may be 
retaining decommissioning funds in excess of the amount required and 
that the application is silent as to the distribution of any excess 
money remaining after decommissioning.\48\
---------------------------------------------------------------------------

    \46\ See Cortlandt's Petition at 8.
    \47\ See Cortlandt's Petition at 9.
    \48\ See Sansoucy Letter at 3.
---------------------------------------------------------------------------

    With the exception of Mr. Sansoucy's assertion concerning excess 
funds, the issue is overly vague. Cortlandt nowhere identifies the 
liabilities about which it is concerned. Nor does it explain why it 
believes they would fall on the public's shoulders. Mr. Sansoucy's 
claim, while sufficiently specific, lies beyond the scope of this 
proceeding. The Commission does not have statutory authority to 
determine the recipient of excess decommissioning funds. For these 
reasons, we decline to admit this issue.\49\
    e. Scope of Commission's Consideration of Indian Point 3 
Decommissioning Issues to Include Indian Point 2 Matters. In addition 
to raising these substantive issues regarding decommissioning funding, 
Cortlandt requests that the Commission consider the transfer in light 
of both the fact that Units 2 and 3 share common facilities and the 
possibility that Entergy Indian Point (or one of its affiliates) may 
acquire Indian Point Unit 2--a possibility which Cortlandt states is 
specifically contemplated in the Indian Point 3 transfer 
agreements.\50\ We decline to expand the scope of this proceeding in 
the two ways that Cortlandt requests. Cortlandt has not explained how 
either the commonality of facilities or Entergy's possible purchase of 
Unit 2 bears on the acceptability of the Indian Point 3 transfer.
---------------------------------------------------------------------------

    \49\ To the extent that Mr. Sansoucy intended here to argue that 
such retention of decommissioning funds was a way of making a profit 
off of the fund, we address that issue at page 33, below.
    \50\ See Affirmation of Peter Henner at Paras. 8, 42, 46; 
Cortlandt's Reply Brief at 14. In fact, Entergy recently announced 
that it had contracted to purchase from ConEd both Indian Point 
Units 1 and 2. See ``Entergy to Purchase 2 Nuclear Power Plants in 
New York State,'' Wall Street Journal at A-6 (Nov. 10, 2000).
---------------------------------------------------------------------------

    f. Entergy's Intention to Make a Profit on the Decommissioning 
Fund. CAN objects to Entergy's espoused intent to make a profit on the 
decommissioning trust funds and to return that profit to its 
shareholders. To accomplish this, Entergy would, according to CAN, have 
to cut corners and thereby risk public health and safety. See CAN's 
Petition at 21. CAN believes that Entergy will try to turn a profit by 
minimizing the onsite remediation by constructing new power plants on 
the decommissioning sites and rotating the decommissioning work 
schedules at simultaneously decommissioning facilities. See CAN's 
Petition at 21, 22.

[[Page 78207]]

    In support, CAN refers us to page 23 of Entergy's 1999 Annual 
Report.\51\ We have checked the cited page on Entergy's web page and 
find no such statement. Although page 24 of the Annual Report does 
contain a reference to ``manag[ing] decommissioning of nuclear plants . 
. . as a source of earnings,'' the reference is made in the context of 
Entergy's contracts to decommission plants owned by other entities. We 
conclude that CAN has provided no basis for this issue, and we decline 
to admit it.
---------------------------------------------------------------------------

    \52\ CAN's Petition at 21 and n.22. However, CAN provides us a 
copy of neither the report nor the cited page. Even after Entergy 
denied ever expressing such an intent (Answer to CAN's Petition at 
13 n.9), CAN in its Reply Brief still failed to support its claim 
with the necessary documentation.
---------------------------------------------------------------------------

    g. Lack of Provision for Off-Site Remediation. CAN asserts that, 
despite both plants having an incontestible record of off-site releases 
of hazardous radioactive and non-radioactive material, neither the 
Decommissioning Cost Estimates, the Purchase and Sale Agreement nor the 
License Transfer Applications contain a provision addressing off-site 
remediation. See CAN's Petition at 20, 23-26. In support, CAN points 
specifically to section 2.4(b) of the Purchase and Sale Agreement, 
which provides that Entergy will not assume decommissioning 
responsibility for the remediation of off-site contamination occurring 
during PASNY's ownership of the plants. Although CAN acknowledges that 
it may be unfair to hold Entergy accountable for contamination 
occurring under PASNY's ownership, it points out that the Purchase and 
Sales Agreement contains no provision holding PASNY liable for that 
contamination. CAN is concerned that an NRC approval of the transfer 
could absolve both Entergy and PASNY of such responsibility. See CAN's 
Petition at 23-24.
    To resolve this problem, CAN proposes that the Commission impose 
one of the following two conditions on the transfer:

    ``Through the Environmental Impact Statement requested 
[elsewhere in CAN's Petition, the NRC staff should] establish an 
accurate and detailed study of [the off-site] contamination . . . 
which PASNY must remediate before the license can be transferred.''
    or
    PASNY ``should not simply be released from all licensee 
responsibility, but rather issued a ``decommissioning'' license 
until [PASNY] has completed'' whatever remediation for which Entergy 
is not assuming responsibility.

    See CAN's Petition at 24. If the Commission imposes either of these 
conditions, CAN requests that it also address how to fund this partial 
remediation. CAN is concerned that PASNY's accountability for partial 
site remediation and cleanup not compromise the quantity of funds 
available to complete the decommissioning after the license expires. 
See CAN's Petition at 24. CAN also provides a third alternative 
condition:

    The Commission disregard ``clause 2.4(b) . . . insofar as [it 
affects] decommissioning responsibilities . . .;, and Entergy should 
be required to conduct a complete . . . decommissioning without 
regard to whether the off-site contamination was caused by [PASNY] 
or Entergy, but [with] Entergy . . . allowed to recover those 
[actual] costs from [PASNY that] . . . exceed the amount in the 
Decommissioning Trust.''

See CAN's Petition at 24-25.
    Applicants respond that nothing in the purchase and sales agreement 
relieves PASNY of any liabilities not assumed by the Entergy 
applicants, and that PASNY ``retains liability for off-site disposal, 
storage, etc. that occurred prior to closing.'' See Answer to CAN's 
Petition at 14. Our review of the agreement gives us no reason to 
question the applicants' interpretation. We therefore see no reason to 
impose the conditions CAN has requested. Moreover, we see no basis for 
CAN's concern that this retained liability will somehow deplete the 
FitzPatrick and Indian Point 3 decommissioning trust funds. Those funds 
are set aside in a trust specifically and exclusively dedicated to the 
purpose of decommissioning the plant sites; the trust cannot be used 
for offsite remediation.\52\ In short, we see nothing in CAN's offsite 
remediation argument that raises a material issue of fact or law 
meriting a hearing.
---------------------------------------------------------------------------

    \52\ Decommissioning trusts are reserved for decommissioning as 
defined in 10 CFR Sec. 50.2. Thus, offsite remediation would not be 
an accepted expense. However, some licensees use the decommissioning 
trust to accumulate funds for both ``decommissioning'' as NRC 
defines it and decommissioning in the broader sense that includes 
interim spent fuel management, non-radioactive structure demolition, 
and site remediation to greenfield status. The Commission accepts 
this approach as long as the NRC-defined ``decommissioning'' funds 
are clearly earmarked. Also, once the funds are in the 
decommissioning trust, withdrawals are limited by 10 CFR Sec. 50.82, 
so that non-``decommissioning'' funds (again, as defined by the NRC) 
could only be spent after the NRC-defined ``decommissioning'' work 
had been finished or committed.
---------------------------------------------------------------------------

    h. Environmental Impact Statements. CAN requests the Commission to 
prepare environmental impact statements (``EIS'') regarding the 
adequacy of the decommissioning funding. See CAN's Petition at 26-27. 
CAN later refines this request to cover only the levels of on- and off-
site contamination. See CAN's Reply Brief at 18. CAN points out that, 
prior to 1980, plants throughout the United States buried radioactive 
waste both on- and off-site, with poor documentation and few 
safeguards. CAN would like the Commission to prepare EIS's for the two 
plants to determine the extent of contamination and to set realistic 
funding requirements. CAN points to the experimental nature of 
decommissioning and to the decommissioning cost overruns at every 
decommissioned plant to date. See CAN's Petition at 26-27. CAN doubts 
Entergy's claim that, with experience, it can decrease its 
decommissioning costs by developing special techniques. CAN also doubts 
that Entergy will have garnered that experience by the time it needs to 
decommission both Indian Point 3 and FitzPatrick starting in 2013 and 
2015, respectively.\53\ CAN further asserts that the Entergy companies' 
inability to recoup their decommissioning expenses from ratepayers 
constitutes yet another obstacle to successful decommissioning. See 
CAN's Petition at 28. We decline to admit this issue for the same 
reasons set forth in our recent decision in Vermont Yankee:
---------------------------------------------------------------------------

    \53\ See CAN's Petition at 27-28. The FitzPatrick license 
actually expires in 2014.

    CAN's ``NEPA'' issue amounts to another effort to litigate site-
specific decommissioning cost estimates. CAN's position rests on the 
assumption that our regulations require AmerGen Vermont, in its 
license transfer application, to provide an estimate of the actual 
decommissioning and site clean-up costs. As explained in the 
previous section of this order, our regulations impose no such 
requirement. Our decommissioning funding regulation (10 CFR 
50.75(c)) generically establishes the amount of decommissioning 
funds that must be set aside.\47\ CAN cannot challenge the 
regulation in this proceeding. As noted above, the NRC's 
decommissioning funding rule reflects a deliberate decision not to 
require site-specific estimates in setting decommissioning funding 
levels. CAN has not sought a waiver of that rule in this proceeding. 
See 10 CFR 2.1329 * * *; Seabrook, CLI-99-6, 49 NRC at 217 n.8. Nor 
has CAN reconciled its demand for a NEPA review with our rules' 
``categorical exclusion'' of license transfers from NEPA 
requirements. See 10 CFR 51.22(c)(21).
    \47\ CAN's supporting argument that decommissioning technology 
is still in an experimental stage fails for the same reason, i.e., 
it is a collateral attack on 10 CFR 50.75(c) establishing the amount 
of decommissioning funds that must be set aside. It is worth noting 
that the NRC rule which CAN attacks, 10 CFR 50.75(c), is in fact 
supported by a

[[Page 78208]]

generic environmental impact statement. See Generic Environmental 
Impact Statement, NUREG-0586 (August 1988) (issued in conjunction 
with the promulgation of 10 CFR 50.75 and 50.82). See generally 
Final Rule, ``General Requirements for Decommissioning Nuclear 
Facilities,'' 53 FR 24018, 24051 (June 27, 1988).\54\
---------------------------------------------------------------------------

    \54\ CLI-00-20, 52 NRC at____, slip op. at 8-10 (final footnote 
omitted). See also Monticello, CLI-00-14, 52 NRC at 59.
---------------------------------------------------------------------------

    CAN also seeks an EIS on two grounds unrelated to 
decommissioning: that the problems at Indian Point 3 which persuaded 
Entergy to pass up an opportunity to become the plant's operator in 
1996 still exist (see CAN's Petition at 48-51), and that the 
Commission's failure to conduct an antitrust review constitutes a 
major federal action affecting the quality of the environment (see 
CAN's Petition at 61). CAN later broadens the first of these so as 
to seek an EIS on the new owners' operation of both plants. See 
CAN's Reply Brief at 17-18. We reject these two EIS issues on the 
same grounds as set forth immediately above. In addition, we exclude 
the first EIS issue (as broadened) on the ground that the scope of 
this proceeding does not include the new owners' operation of the 
plants--but includes only the transfer of their operating licenses. 
Further, we exclude the antitrust EIS issue on same ground we used 
to reject CAN's same argument in Vermont Yankee.\55\

    \55\ CLI-00-20, 52 NRC at____, slip op. at 11 (footnote 
omitted): The fact that a particular license transfer may have 
antitrust implications does not remove it from the categorical 
exclusion. In any event, because the AEA does not require, and 
arguably does not even allow, the Commission to conduct antitrust 
evaluations of license transfer applications, our purported 
``failure'' to conduct such an evaluation cannot constitute a 
Federal action warranting a NEPA review.
---------------------------------------------------------------------------

4. CAN's Non-Labor Related Technical Qualifications Issues
    CAN raises an array of challenges to the technical qualifications 
of the workforce that will be employed at FitzPatrick and Indian Point 
3 once the Entergy companies take over those plants. CAN's claims, 
however, are not directly linked to the license transfers at issue 
here, but rest largely on current operational issues at the two plants 
and on Entergy's operation of other plants, including non-nuclear 
plants. As in our recent Vermont Yankee and Oyster Creek decisions, 
where we rejected claims all but identical to CAN's, we find here that 
CAN has provided no documents, facts or expert opinion establishing a 
genuine issue concerning technical qualifications. See also Millstone, 
CLI-00-18, 52 NRC at 131-32, citing 10 CFR 2.1306(b)(2)(iii).
    a. Age-Related Defects at Both Plants. CAN asserts that the Entergy 
companies lack the ability to manage FitzPatrick (a boiling-water 
reactor or ``BWR'') and Indian Point 3 (a pressurized-water reactor or 
``PWR''). CAN claims that FitzPatrick is older and subject to more age-
related degradation than Entergy's other BWRs. See CAN's Petition at 
29-36. CAN concludes that Entergy is significantly overstating its 
claim of experience in maintaining and operating BWRs and that 
Entergy's spotty record in managing PWRs (such as Indian Point 3) 
suggests the company's ability to manage an increasing number of aging 
reactors may be stretched past the breaking point. See id. at 29-30. 
Based on these arguments, CAN asks the Commission to ``take into 
consideration the effect of consolidating a large number of aging, 
mismanaged and otherwise troubled facilities under a single corporate 
umbrella, especially given the rigors of operating those facilities in 
a deregulated electricity market without the flexibility of returning 
to ratepayers to reimburse unexpected operating and maintenance 
costs.'' See id. at 30.
    CAN ignores Entergy Nuclear Operations' stated intent to employ the 
same personnel as are currently working at the two plants. Nor does 
CAN's Petition challenge these individuals' technical qualifications. 
Its discussion of Entergy's experience in operating other BWRs and PWRs 
and the age of other Entergy plants does not bear on the technical 
qualifications of the transferees and their intended employees at 
FitzPatrick and Indian Point 3. See Vermont Yankee, CLI-00-20, 52 NRC 
at ____, slip op. at 11-13 (declining to admit a similar issue where 
CAN failed to challenge the technical qualifications of the plant's 
intended employees). We therefore decline to admit this issue.
    b. Leak-Detection Problems at Both Plants. CAN points to alleged 
leak detection problems at the two plants and asks the Commission to 
require Entergy to modify inspections and leak detection equipment and 
to institute programs to study the rate of crack propagation. CAN 
further asks the Commission to oversee the development of systems and 
procedures necessary to provide an objective review of these actions. 
See CAN's Petition at 32-33. Moreover, CAN asks the Commission to deny 
the license transfer application on the ground that Entergy, with a 
tightly-packed maintenance schedule and a depleted workforce (due to 
``profitability'' cuts), lacks the flexibility necessary to react 
quickly to surprises at two or more generating plants. See CAN's 
Petition at 33. In a similar technical challenge to the two 
applications, CAN points to certain evidence that the Updated Final 
Safety Analysis Reports (``UFSAR'') for both plants have not been kept 
up-to-date, and argues that it would be premature to approve a transfer 
of licenses for reactors which were in an unanalyzed condition. See 
CAN's Petition at 34-36.
    We recently addressed a quite similar argument from CAN in Vermont 
Yankee concerning another company's ability to discern cracks and 
leaks. We consider our response there equally dispositive of CAN's 
contention in this proceeding:

    These arguments address the adequacy of the plant's ongoing 
safety-related programs. Operational issues of this kind will remain 
the same whether or not the license is transferred. The Commission 
has indicated that a license transfer hearing is not the proper 
forum in which to conduct a full-scale health-and-safety review of a 
plant.\14\

    \14\ ``A license transfer proceeding is not a forum for a full 
review of all aspects of current plant operation.'' See Oyster 
Creek, CLI-00-6, 51 NRC at 213, 214 * * * CAN may, of course, file a 
petition for staff enforcement action pursuant to 10 CFR 2.206 if it 
is concerned about current safety issues at Vermont Yankee.

See Vermont Yankee, CLI-00-20, 52 NRC at ____, slip op. at 13. 
Moreover, in Vermont Yankee, we rejected a similar request from CAN 
(that the Commission require special training as a condition for its 
approval of the transfer) on the ground that CAN ``failed to 
demonstrate that a genuine dispute exists, with requisite specificity, 
on this basis.'' See CLI-00-20, 52 NRC at ____, slip op. at 13. See 
also 10 CFR 2.1306(b)(2)(iv). This ruling applies equally to CAN's 
similar argument here.\56\
---------------------------------------------------------------------------

    \56\ CAN indicated, for the first time in its Reply Brief, that 
it was raising the cracks-and-leaks and UFSAR arguments not only as 
technical and administrative problems meriting the Commission's 
attention and correction, but also as an indication of the lack of 
technical qualifications of the existing plants' staff, on whose 
technical qualifications Entergy Nuclear Operations is relying in 
the applications. See CAN's Reply Brief at 16. CAN's effort to 
recast its claim is unavailing. As indicated in Vermont Yankee 
(quoted in the text immediately above), any ongoing operational 
deficiencies at nuclear plants subject to a license transfer must be 
addressed regardless of the transfer.
---------------------------------------------------------------------------

    c. Issues of Management ``Character''. CAN asserts that Entergy's 
license transfer applications rely on the resources and experience of 
the parent company (Entergy Corp.), its public utility subsidiaries 
(Entergy Arkansas Inc., Entergy Gulf States Inc., Entergy Louisiana 
Inc., and System Energy Resources Inc.), and its operations subsidiary 
(Entergy Operations Inc.) to establish a track record as a nuclear 
operator. CAN describes the operating records of these affiliates as 
``mixed at best, irrelevant in some regards, and alarming in many 
others.'' See CAN's Petition at 37. CAN further argues that, because 
the majority of Entergy Nuclear

[[Page 78209]]

Operations'', Entergy FitzPatrick's and Entergy Indian Point's 
corporate officers hold positions in other Entergy companies, these two 
new companies will inevitably inherit the existing companies' record 
and operational style. See CAN's Petition at 37; CAN's Reply Brief at 
16. According to CAN, this record and style are reflected in the facts 
that Entergy has among the highest number of NRC violations in the 
United States and that the company's improved capacity factors are 
``shadowed by questionable maintenance practices and inadequate 
procedures, work performance, and operator training.'' See CAN's 
Petition at 38. CAN relies not only on Entergy's record as a nuclear 
generator; it also points to findings that, in the electrical 
transmission and delivery business, Entergy has a record of 
marginalizing safe operations by chronically postponing maintenance and 
reducing the skilled workforce to levels that compromise worker and 
public safety. See CAN's Petition at 38-40, citing findings of the 
Texas Public Utility Commission (``Texas PUC'') and the Council of the 
City of New Orleans, both in 1998.\57\
---------------------------------------------------------------------------

    \57\ See CAN's Petition at 39-40 (citing and quoting Public 
Utility Commission of Texas, Docket No. 18249, Entergy Gulf States, 
Inc., Service Quality Issues (Feb. 1998); Groesch, Report to New 
Orleans City Council for the Alliance for Affordable Energy (Aug. 
13, 1999); and Groesch, Statement before the New Orleans City 
Council Utility Committee (Aug. 12, 1999)). The second and third of 
these three documents are included in Exh. 9 to CAN's Petition.
---------------------------------------------------------------------------

    Absent strong support for a claim that difficulties at other plants 
run by a corporate parent will affect the plant(s) at issue before the 
Commission, we are unwilling to use our hearing process as a forum for 
a wide-ranging inquiry into the corporate parent's general activities 
across the country. Here, CAN's various references to problems of other 
Entergy subsidiaries, including the non-nuclear subsidiaries, tell us 
little if anything about Entergy Nuclear Operations' technical 
qualifications to operate FitzPatrick and Indian Point 3 using the same 
workforce that is already there. See Vermont Yankee, CLI-00-20, 52 NRC 
at ____, slip op. at 14-15, (concluding that ``claims of staffing 
deficiencies at other nuclear facilities owned by AmerGen'' were 
insufficient to trigger our hearing process). See also Oyster Creek, 51 
NRC at 209-10.
    Nor do we believe a hearing is merited by CAN's conclusory 
assertions that the corporate culture of Entergy Nuclear Operations 
will be tainted by the influence of high-level officials from the 
parent company and other subsidiaries. CAN does not identify which 
officials will undercut safety at Indian Point and FitzPatrick or 
explain how they will do so. CAN's claims are too broad and too vague 
to be suitable for adjudication. We therefore decline to admit this 
issue.
    d. Cost-Cutting Pressures. CAN questions whether Entergy 
FitzPatrick and Entergy Indian Point can safely accomplish the goals 
necessary for the companies to reduce costs to a level sufficiently low 
for the plants' electric rates to be competitive, i.e., reducing 
maintenance and outage times and workforce size.\58\ According to CAN, 
Entergy's applications indicate a goal of 85-percent capacity (or 15-
percent downtime). CAN acknowledges that PASNY was able to meet the 
same refueling schedule at Indian Point 3 that Entergy will need to 
maintain, but says that PASNY did so only by unnecessarily exposing its 
workforce to radiation. See CAN's Petition at 41-42. Finally, CAN draws 
the Commission's attention to ConEd's decision not to replace the steam 
generators at Indian Point Unit 2, warning that Entergy will experience 
cost-cutting pressures similar to those which led to ConEd's 
problems.\59\
---------------------------------------------------------------------------

    \58\ See CAN's Petition at 41-47. CAN points to the problems of 
a foreign nuclear plant owner, British Energy, as an example of how 
public safety can be adversely affected by over-reduction of the 
workforce. See CAN's Petition at 44-46. See also Declaration of 
David A. Lochbaum, dated July 31, 2000, at 2 (para. 9(a)), appended 
as Attachment 3 to CAN's Petition.
    \59\ See CAN's Petition at 42. ConEd has informed the NRC that 
it has replaced these steam generators. See Letter from John A. 
Zwolinski (NRC) to A. Alan Blind (ConEd) (Oct. 11, 2000).
---------------------------------------------------------------------------

    CAN has failed to provide adequate support or basis for its general 
``cost-cutting'' issue. It has not provided the necessary nexus between 
the problems at other plants (some not even in this country) operated 
by different companies and the difficulties it anticipates from Entergy 
FitzPatrick, Entergy Indian Point and Entergy Nuclear Operations. See 
Oyster Creek, CLI-00-6, 51 NRC at 209-10. Nor does it offer any factual 
support for its claim that the Entergy companies will subordinate 
safety to production goals or profits. See Oyster Creek, CLI-00-6, 51 
NRC at 207 (``Absent [documentary] support, this agency has declined to 
assume that licensees will contravene our regulations'') and cited 
authority. Finally, CAN's speculation about the likelihood and 
ramifications of staff reductions is insufficient to trigger a hearing 
on this issue. CAN points to no information suggesting that Entergy 
plans to reduce its staff below NRC requirements. As we stated in 
Oyster Creek:

    For key positions necessary to operate a plant safely, the 
Commission has regulations requiring specific staffing levels and 
qualifications. See 10 CFR Sec. 50.54(m). Other than those specific 
positions, the licensee has a responsibility to ensure that it has 
adequate staff to meet the Commission's regulatory requirements. If 
a licensee's staff reductions or other cost-cutting decisions result 
in its being out of compliance with NRC regulations, then (as noted 
above) the agency can and will take the necessary enforcement action 
to ensure the public health and safety. The Oyster Creek application 
does not on its face suggest any likelihood of a cost-driven lapse 
in compliance with NRC safety rules.

CLI-00-6, 51 NRC at 209. See also id. at 214 (``so long as personnel 
decisions do not impose [a] risk [to the public health and safety], our 
regulations and policy do not preclude a licensee from reducing or 
replacing portions of its staff'').
5. The Association's Labor-Related Technical Qualifications Issues
    The Association raises labor-related issues which, it claims, bear 
directly on the question whether the transfer will ensure the presence 
of ``sufficient management personnel, and appropriate working 
conditions, so as to assure continued safe operation of the 
facilities.'' See Association's Petition at 9. As noted in the 
discussion of standing, supra, the Association alleges a precipitous 
decline in morale among the members of the Association; a high level of 
confusion regarding future rights and benefits; a significantly 
increased attrition rate among Association members; a general belief 
that the transfer will markedly reduce their rights and benefits; and a 
developing uneasiness with, and unwillingness to trust, or communicate 
safety-related problems to, senior executive nuclear management or 
corporate management. See Association's Petition at 17.
    The Association's claims arise out of what it says is the 
``increasingly adversarial nature of the dialogue (or lack thereof) 
between its members and the proposed transferor and transferees 
concerning the putative rights and benefits that will be available to 
petitioners following the proposed transfer.'' See id. A contest over 
``putative rights and benefits'' amounts, of course, to a labor dispute 
rooted in economic concerns. Indeed, the Association has brought state-
court litigation to adjudicate the labor controversy and, as if to 
stress the labor relations nature of its claims, the Association has 
included its lengthy

[[Page 78210]]

state-court complaint in the record before us.\60\
---------------------------------------------------------------------------

    \60\ See Verified Petition, Nuclear Generation Employees Ass'n 
v. New York Power Auth. (Sup. Ct., Westchester Co., NY), Index No. 
11129/00 (filed July 27, 2000) (appended to Association's Reply 
Brief as Exh. 1). See also Association's Reply Brief, dated Aug. 3, 
2000, at 3.
---------------------------------------------------------------------------

    As a nuclear safety agency, however, we are loath to step into the 
middle of a labor dispute. The Association seemingly expects us to 
consider whether Entergy's commitments regarding salary, benefits and 
job security are so unjust as to ruin employee morale and cause 
excessive attrition at FitzPatrick and Indian Point 3. But we have 
neither the expertise nor the legislative charter of a National Labor 
Relations Board or labor mediator. We see no natural limits to the 
labor issues the Association wants us to consider. We thus find the 
Association's labor grievances unsuitable for a license transfer 
hearing.
    The Association, apparently sensitive to the Commission's 
reluctance to enmesh itself in management-worker conflicts at nuclear 
facilities, attempts to argue that its labor dispute with PASNY and 
Entergy translates into a health and safety problem that the Commission 
should consider at a hearing. But, while the Association's pleadings 
frequently allude to alleged health and safety effects of the labor 
controversy, what the Association has given us, at bottom, consists of 
specific accusations of bad faith in labor relations and that are tied 
to vague or conclusory assertions about health and safety. On the 
latter issue, the only one falling within the NRC's jurisdiction, the 
Association provides no expert support, no concrete facts, and no 
claims of specific rule violations.
    Further, the specific concerns about pay, benefits and conditions 
that the Association points to as the source for morale issues are 
potential (not certain) changes in pay, benefits and conditions that 
would not occur for between one and three years after completion of the 
transfer. The Commission is particularly reluctant to engage in 
prognostication of the impact of changes in current working conditions 
that the Association has in its own pleadings and affidavits 
acknowledged may occur years in the future. Unsupported hypothetical 
theories or projections, even in the form of an affidavit, will not 
support invocation of the hearing process. In short, the Association 
has not provided tangible regulatory issues around which to organize a 
hearing.
    The Association's most specific health and safety claims are 
charges that the labor controversy will provoke high attrition and poor 
morale. But neither claim raises a genuine controversy for hearing. As 
for the purported increase in attrition, the Association merely says 
that it is so. The Association does not provide factual data, expert 
witnesses, or even affidavits of employees who have or will quit as a 
result of the license transfer.\61\ As for morale, we do not see how we 
could adjudicate such an abstract concept at a hearing absent some 
allegation of specific rule violations or specific safety challenges 
arising out of lower morale. Notably, the Association has submitted no 
evidence, such as inspection reports or other indicators, suggesting an 
increase in safety problems at the two plants.
---------------------------------------------------------------------------

    \61\ The Association's failure to provide actual data on 
departing employees renders virtually meaningless its reference to a 
``more than doubl[ing]'' of the normal attrition rate for its 
members. See Joint Declaration at 6. By way of extreme example, if 
the normal attrition rate were one person per year per plant, a 
doubling of this rate would provide no conceivable basis for health-
and-safety concerns.
---------------------------------------------------------------------------

    We add a cautionary note. Today's decision does not hold that 
economic concerns, whether of a labor, commercial or other nature, are 
categorically excluded from the NRC hearing process. Such concerns, if 
closely tied to specific health and safety concerns or to potential 
violations of NRC rules, can be admitted for hearing. See, e.g., North 
Atlantic Energy Serv. Corp. (Seabrook Station, Unit 1), CLI-99-27, 50 
NRC 257, 262-63 (1999). Indeed, in our Subpart M rulemaking, which 
established our current license transfer hearing process, we expressed 
a willingness to review labor-type issues to a limited extent:

[I]f a significant loss and replacement of critical plant personnel 
can be anticipated as the result of a particular license transfer[,] 
this might well be a reason not to approve the transfer or to 
condition the transfer on the maintenance of adequate technical 
qualifications.
* * * * *
If, in a particular license transfer case, a need is identified for 
submission of a critical staff retention plan in order to address 
the applicant's technical qualifications, this matter can readily be 
addressed in the hearing process and can ultimately result in a 
condition on license transfer approval.

Final Rule, ``Streamlined Hearing Process for NRC Approval of License 
Transfers,'' 63 FR 66721, 66723 (Dec. 3, 1998).
    Claims resting on the loss and replacement of ``critical'' staff 
derive directly from our rules, which specify both minimum staffing 
requirements for trained operators at reactors and the technical 
qualifications of such employees. See 10 CFR Sec. 50.54(m). See also 
Oyster Creek, CLI-00-06, 51 NRC at 209 (NRC staffing regulations cover 
``key positions necessary to operate the plant safely''). Here, the 
Association asserts no current or future section 50.54(m) violations 
arising out of the PASNY-Entergy license transfer. (Nor, frankly, would 
we expect such a challenge from the Association, some of whose members 
hold the very staff positions covered by section 50.54(m).)
    Notwithstanding the narrow exception in the rulemaking language 
quoted above, the Commission generally does not involve itself in the 
personnel decisions of licensees. As we indicated in Oyster Creek:

The Commission is interested in whether the plant poses a risk to 
the public health and safety, and so long as personnel decisions do 
not impose that risk, our regulations and policy do not preclude a 
licensee from reducing or replacing portions of its staff. . . . 

CLI-00-6, 51 NRC at 214. See also Vermont Yankee, CLI-00-20, 52 NRC at 
____, slip op. at 14 n.16 and accompanying text. We would require 
personnel claims considerably more concrete than the Association's--
i.e., specific indications of a potential rule violation or of 
deteriorating safety conditions linked to the license transfer--before 
we would consider admitting plant staffing questions into an NRC 
license transfer hearing.
    We by no means intend to denigrate the concerns of the 
Association's members, who work at FitzPatrick and Indian Point 3 and 
have an understandable interest in working conditions at the two 
plants. The question whether those conditions are fair and lawful is an 
important one. But our license transfer hearings under Subpart M are 
designed solely to adjudicate genuine health and safety disputes 
arising out of license transfers. The grant of hearings merely on the 
broad assertion that contentious labor controversies will lead to 
deleterious health and safety consequences would have no stopping point 
and would risk converting our agency into a labor relations forum, 
contrary to our statutory mission and at a significant cost in 
resources and effort.
    For these reasons, we decline to admit for hearing the 
Association's labor-related issues.\62\
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    \62\ Like the Association, CAN raises the issue that much of the 
plants' existing staff will quit their jobs as a result of the 
transfer. See CAN's Petition at 44; CAN's Reply Brief at 16. But CAN 
has provided little detail, and no back-up support, for this claim. 
For the reasons stated in the text, CAN's claims on this score are 
inadmissible. See also Oyster Creek, CLI-00-6, 51 NRC at 209-10, 
214.

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[[Page 78211]]

6. Issues Involving Emergency Evacuation Plans
    Cortlandt asks the Commission to consider the impact of the 
proposed transfers on the need for changes to the Emergency Evacuation 
Plans. See Cortlandt's Supplemental Filing at 2. It expresses similar 
concerns about whether the transferees for Indian Point 3 will 
discontinue the emergency warning program, emergency preparedness 
training program, and health impact training program currently run by 
PASNY.\63\
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    \63\ See Affirmation of Peter Henner at para.25(d); Cortlandt 
Verified Petition at 5, 8, 19 (referring to ``emergency planning and 
health impact training programs;'' ``emergency preparedness plans, 
local preparedness resources, and the Four County Notification 
System;'' and ``the payment of the State Emergency Management 
Office, bus driver training and reception centers, public education 
programs, including emergency planning and radiological training and 
medical drills'').
---------------------------------------------------------------------------

    The new licensees will have to meet all of the requirements of 10 
CFR 50.47 and Appendix E to 10 CFR part 50 concerning emergency 
planning and preparedness. The emergency notification system is 
required by the regulations and will remain in place. Cortlandt has not 
alleged, with supporting facts, that Entergy is likely to violate the 
NRC's emergency planning rules. Under these circumstances, we see no 
basis for further pursuit of this issue.
7. Appropriateness of Indian Point 3 Transfer, Given Its Location
    Cortlandt asks the Commission to consider the appropriateness of 
the proposed Indian Point 3 transfer in light of the plant's proximity 
to metropolitan areas (New York City, White Plains and Peekskill) and 
to locations for sporting and cultural events. See Cortlandt's 
Supplemental Filing at 4. Cortlandt explains that the plant is located 
24 miles north of New York City in the heavily-populated Westchester 
County, and that it is two miles from the City of Peekskill (population 
20,000), 2 miles from a military reservation (Camp Smith), and eight 
miles from West Point. See Affirmation of Peter Henner at Paras. 2-3. 
We do not see how Indian Point 3's proximity to these locations is 
relevant to the question whether to approve the license transfer for 
that plant. We therefore decline to admit this issue.
8. Antitrust Issue
    Cortlandt expresses an antitrust concern that, if Entergy merges 
with Florida Power and Light Company (FPL Group), the combined entity's 
market share will give it an inordinate amount of control over the 
nation's nuclear industry. Cortlandt's Reply Brief at 17. As we have 
explained in prior cases, the Commission no longer conducts antitrust 
reviews in license transfer proceedings.\64\
---------------------------------------------------------------------------

    \64\ See Vermont Yankee, CLI-00-20, 52 NRC at ____, slip op. at 
11, 19-20; Oyster Creek, CLI-00-06, 51 NRC at 210; Kansas Gas and 
Elec. Co., (Wolf Creek Generating Station, Unit 1), CLI-99-19, 49 
NRC 441 (1999). See also Final Rule, ``Antitrust Review Authority: 
Clarification,'' 65 Fed. Reg. 44,649 (July 19, 2000).
---------------------------------------------------------------------------

    CAN also raises the antitrust issue, acknowledging our precedents 
but disagreeing with them. CAN criticizes the Commission for having 
declined to conduct further antitrust review in these cases, calls that 
decision an abdication of the agency's antitrust responsibilities under 
the AEA, and predicts that such abdication will lead to a rapid 
consolidation of nuclear power ownership through premature acceptance 
of this and other Entergy applications and overly-accelerated hearing 
schedules. CAN's Petition at 13. See also id. at 14-15, 56-64; CAN's 
Reply Brief at 18-20. For the reasons set forth in both the Wolf Creek 
decision and the rulemaking, supra, we do not agree with CAN's 
characterization that we are abdicating our statutory authority. Nor do 
we believe we are acting precipitously in giving expedited treatment to 
license transfer applications. We therefore find this issue 
inadmissible.\65\
---------------------------------------------------------------------------

    \65\ Regarding CAN's prediction of industry consolidation, see 
note 16, supra.
---------------------------------------------------------------------------

9. Independent Evaluation of the Plants
    CAN asserts that, given the historical problems in NRC's Region I, 
the Commission should arrange for an independent analysis of the two 
plants' conditions. See CAN's Petition at 51-54. We decline to do so 
for the same reasons we gave in Vermont Yankee when rejecting CAN's 
similar issue:

    An inquiry such as the one CAN advocates would go considerably 
beyond the scope of our inquiry in this proceeding, i.e., AmerGen 
Vermont's qualifications to own and operate the Vermont Yankee 
plant. We also note that Region I's overall performance in 
overseeing Vermont Yankee is far outside the scope of a license 
transfer proceeding. CAN does not explain how any action taken with 
respect to this license transfer, whether it be denial of the 
license or the imposition of conditions on the transferee, could 
remedy CAN's broad complaints that NRC's Region I has abdicated its 
oversight responsibilities.\66\
---------------------------------------------------------------------------

    \66\ CLI-00-20, 52 NRC at ____, slip op. at 15. See also 
Curators of the University of Missouri, CLI-95-1, 41 NRC 71, 121 
(1995); Final Rule, ``Rules of Practice for Domestic Licensing 
Proceedings--Procedural Changes in the Hearing Process,'' 54 FR 
33168, 33171 (Aug. 11, 1989) (``With the exception of NEPA issues, 
the sole focus of the hearing is on whether the application 
satisfies NRC regulatory requirements, rather than the adequacy of 
the NRC Staff performance'').
---------------------------------------------------------------------------

V. Other Procedural Matters

A. Designation of Issues

    Our opinion in this case has considered in some detail numerous 
concerns raised by the various petitioners. Some issues we have found 
admissible, and some inadmissible. To avoid confusion, and to delineate 
the boundaries of the admitted issues, we direct the parties to 
organize their presentations at the hearing around the following two 
issues:

    Whether Entergy Indian Point's liability for certain financial 
obligations of Entergy FitzPatrick would place the Indian Point 3 
plant in financial jeopardy in the event of an accident at either 
Indian Point 3 or FitzPatrick and would thereby call into question 
whether Entergy Indian Point has the funds necessary to operate the 
Indian Point plant safely, within the meaning of 10 CFR 50.33(f)(2), 
50.33(f)(3) and 50.80(b)?
    Whether the transfer applicants' plan for handling 
decommissioning funds for the FitzPatrick and Indian Point nuclear 
plants--whereby control of the decommissioning funds will remain 
with PASNY but responsibility for decommissioning the plants will 
reside with the Entergy companies--provides reasonable assurance of 
adequate decommissioning funding, within the meaning of 10 CFR 
50.75(b) and 50.75(e)(1)(vi).

    The precise contours of these two admitted issues are set forth 
above at pages 18-20 (issue 2a, raised by Cortlandt regarding the 
effect of joint and several liability on the Entergy companies' 
financial qualifications) and 25-26 (issue 3a, raised by the 
Association and CAN regarding whether the decommissioning funding 
arrangement is consistent with the requirements of 10 CFR 50.75), 
respectively. The parties' filings and arguments must be confined to 
the contours of these two issues. In addition, as indicated on page 23, 
we permit CAN and Cortlandt to submit a revised issue challenging the 
Entergy companies' cost-and-revenue projections, such issue to be filed 
within 20 days of the issuance of a protective order giving CAN and 
Cortlandt access to applicants' proprietary information.
    The parties should be prepared to offer pre-filed testimony and 
exhibits containing specific facts and/or expert opinion in support of 
their positions on these issues. All parties should keep their 
pleadings as short, and as focused on the admitted issues, as possible. 
The Commission will not consider new issues or new arguments or 
assertions related to the admitted issues at the hearing, unless they 
satisfy our rules for

[[Page 78212]]

late-filed issues (10 CFR 2.1308(b)), and will not consider claims 
rejected in the course of this opinion. Redundant, duplicative, 
unreliable or irrelevant submissions are not acceptable and will be 
stricken from the record. See 10 CFR 2.1320(a)(9). We also direct the 
intervenors to state explicitly exactly what remedial measures (if any) 
they believe the Commission should take in addition to those specified 
in their intervention petitions.

B. Designation of Presiding Officer

    The Commission directs the Chief Administrative Judge promptly to 
appoint a Presiding Officer for this proceeding. Until the appointment 
of a presiding officer, the parties should file any written submissions 
with the Office of the Secretary.

C. Notices of Appearance

    To the extent that they have not already done so, each counsel or 
representative for each party shall, not later than 11:59 p.m. on 
December 7, 2000 (i.e., ten days after the issuance date of this 
order), file a notice of appearance complying with the requirements of 
10 CFR 2.713(b). In each such notice of appearance, the counsel or 
representative should specify his or her business address, telephone 
number, facsimile number, and e-mail address. Any counsel or 
representative who has already entered an appearance but who has not 
provided one or more of these pieces of information should do so not 
later than the date and time specified above.

D. Filing Schedule

    If the parties agree to a non-oral hearing, they must file their 
joint motion for a ``hearing consisting of written comments'' no later 
than 11:59 p.m. (Eastern Time) on December 12, 2000 (i.e., fifteen days 
of the date of this order). 10 CFR 2.1308(d)(2). No later than that 
same date, the parties should complete any necessary negotiations on a 
protective order regarding any proprietary data and should submit a 
joint protective order to the presiding officer. If they are 
unsuccessful in negotiating such an order, they should inform the 
Presiding Officer by that date and indicate any areas in which they 
were able to agree.\67\ We also direct the parties to confer promptly 
on whether this proceeding might be settled amicably without conducting 
a hearing.
---------------------------------------------------------------------------

    \67\ Separately, we have directed CAN and Cortlandt to formulate 
and submit a properly-supported financial qualifications issue 
within 20 days of the entry of a protective order. See page 23, 
supra. CAN's failure to do so will preclude its participation with 
regard to the financial qualifications issue. If such an issue is 
submitted, the Presiding Officer should establish a supplemental 
briefing schedule to permit answers and replies thereto. Cf. 10 CFR 
2.1307.
---------------------------------------------------------------------------

    All initial written statements of position and written direct 
testimony (with any supporting affidavits) must be filed no later than 
11:59 p.m. on December 27, 2000 (thirty days after the issuance date of 
this order). 10 CFR 2.1309(a)(4), 2.1310(c), 2.1321(a), 2.1322(a)(1). 
All written responses to direct testimony, all rebuttal testimony (with 
any supporting affidavits) and all proposed questions directed to 
written direct testimony must be filed no later than 11:59 p.m. on 
January 16, 2001 (the first working day following the twentieth day 
after the submission of written statements of position and written 
testimony). 10 CFR 2.1309(a)(4), 2.1310(c), 2.1321(b), 2.1322(a)(2)-
(3). All proposed questions directed to written rebuttal testimony must 
be submitted to the Presiding Officer no later than 11:59 p.m. on 
January 26, 2001 (ten days after the submission of rebuttal 
testimony).\68\
---------------------------------------------------------------------------

    \68\ See 10 CFR 2.1309(a)(4), 2.1310(c), 2.1321(b), 
2.1322(a)(4). The seven-day filing period specified in the last two 
of these regulations is, pursuant to 10 CFR 2.1314(b), extended by 
three days, because the period includes a Saturday and Sunday.
---------------------------------------------------------------------------

    If the parties do not unanimously seek a hearing consisting of 
written comments, the Presiding Officer will hold an oral hearing 
beginning at 9:30 a.m on February 2, 2001, at the Commission's 
headquarters in Rockville, MD. The subject of the hearing will be the 
issues designated above, along with any admissible financial 
qualifications issue regarding the Entergy companies' cost-and-revenue 
projections that CAN and/or Cortlandt may choose to submit within 20 
days of the entry of a protective order. Portions of the hearing may 
have to be closed to the public when issues involving proprietary 
information are being addressed.
    Any party or participant submitting pre-filed direct testimony 
should make the sponsor of that testimony available for questioning at 
the hearing. The Presiding Officer will issue an order establishing the 
amount of time available for the initial and reply presentations of the 
parties and participant. Given the expedited nature of license transfer 
proceedings, the Commission anticipates that the hearing will take no 
longer than one day. The hearing will not include opportunities for 
cross-examination, although the Presiding Officer may question any 
witness proffered by any party. See 10 CFR 2.1309, 2.1310(a), 
2.1322(b).
    Finally, all written post-hearing statements of position must be 
filed no later than 11:59 p.m. on February 22, 2001 (twenty days after 
the oral hearing). See 10 CFR 2.1322(c). The Commission expects to 
issue a final memorandum and order on the merits of this proceeding by 
March 26, 2001 (50 days after the oral hearing).
    The Commission is confident that the proceeding can be resolved 
fairly and efficiently within the prescribed time schedule.

E. Participants in the Hearing and the Proceeding; Service List

    The parties to this proceeding will be CAN, Cortlandt, the 
Association, the Power Authority of the State of New York, Entergy 
Nuclear Operations, Entergy FitzPatrick, and Entergy Indian Point. 
Westchester will be a governmental participant in the proceeding. The 
recipients on the service list will be:

Timothy L. Judson, Citizens Awareness Network, Inc., 162 Cambridge 
Street, Syracuse, NY 13210, phone: (315) 475-1203, e-mail: 
[email protected]
Thomas F. Wood, Esq., Town of Cortlandt, 153 Albany Post Road, 
Buchanan, NY 10511, phone: (914) 736-0930, fax: (914) 736-9082, e-mail: 
[email protected]
Paul V. Nolan, Esq. (Attorney for Town of Cortlandt and Hendrick Hudson 
School District), 5515 N. 17th Street, Arlington, VA 22205-2207, phone: 
(703) 534-5509, fax: (703) 538-5257, e-mail: [email protected]
Nancy T. Bocassi, Hendrick Hudson School District, 61 Trolley Road, 
Montrose, NY 10548, phone: (914) 737-7500, fax: (914) 736-5242, e-mail: 
[email protected]
Alan D. Scheinkman, Esq., County Attorney, Westchester County, 
Department of Law, Room 600, 148 Martine Avenue, White Plains, NY 
10601, phone: (914) 285-2690, fax: (914) 285-5858, e-mail: 
[email protected]
Stewart M. Glass, Esq., Senior Assistant County Attorney, County of 
Westchester, Department of Law, Room 600, 148 Martine Avenue, White 
Plains, NY 10601, phone: (914) 285-3134, fax: (914) 285-2495, e-mail: 
[email protected]
Joseph R. Egan, Esq., Egan & Associates, P.C. (Attorney for Nuclear 
Generation Employees Association), 1500 K Street, N.W., Suite 200, 
Washington, DC 20005, phone: (703) 871-5012, fax: (703) 871-5013 \69\, 
e-mail: [email protected]
---------------------------------------------------------------------------

    \69\ Mr. Egan's office is located in Washington, DC, but his 
phone number has a Northern Virginia area code. There appears to be 
an error here. If so, the Commission requests Mr. Egan to correct 
it.

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[[Page 78213]]

John Valentino, Esq., Green & Seifter (Attorney for Nuclear Generation 
Employees Association), One Lincoln Center, 9th Floor, Syracuse, NY 
13202, phone: (315) 422-1391, fax: (315) 423-2839, e-mail: 
[email protected]
Douglas E. Levanway, Esq. (Attorney for Entergy Nuclear FitzPatrick 
LLC, Entergy Nuclear Indian Point 3 LLC, and Entergy Nuclear 
Operations, Inc.), Wise, Carter, Child and Caraway, P.O. Box 651, 
Jackson, MS 39205-0651, phone: (601) 968-5524, fax: (601) 968-5519, e-
mail: [email protected]
Gerald C. Goldstein, Esq., Arthur T. Cambouris, Esq., David E. Blabey, 
Esq., The Power Authority of the State of New York, 1633 Broadway, New 
York, NY 10019, phone: (212) 468-6131, fax: (212) 468-6206, e-mail: 
[email protected]
Jay E. Silberg, Esq., William R. Hollaway, Esq. (Attorneys for the 
Power Authority of the State of New York), Shaw, Pittman, Potts & 
Trowbridge, 2300 N Street, NW., Washington, DC 20037-1128, phone: (202) 
663-8000, fax: (202) 663-8007, e-mail: [email protected]
Office of the General Counsel, U.S. Nuclear Regulatory Commission, 
Washington, DC 20555, phone: (301) 415-1537, fax: (301) 415-3725, e-
mail: [email protected]
Office of the Secretary, U.S. Nuclear Regulatory Commission, Attn: 
Rulemakings & Adjudications Branch, Washington, DC 20555, phone: (301) 
415-1966/1679, fax: (301) 415-1101, e-mail: [email protected]
George E. Sansoucy, P.E. (representing Hendrick Hudson school 
District), 260 Ten Rod Road, Rochester, NH 03867, phone: (603) 335-
3167, fax: (603) 335-0731, e-mail: [email protected]

    We direct the parties immediately to supplement or correct the 
above information to the extent that it is incomplete or inaccurate, 
and immediately to notify all recipients of any such changes.
    Pursuant to 10 CFR 2.1316(b)-(c), the NRC staff has indicated that 
it will not be a party to this proceeding. Notwithstanding this fact, 
the staff is still expected both to offer into evidence its SER and to 
proffer one or more sponsoring witnesses for that document. See 10 CFR 
2.1316(b).

F. Service Requirements

    Although the parties and Westchester have a number of options under 
10 CFR 2.1313(c) by which to serve their filings, the preferred method 
of filing in this proceeding is electronic (i.e., by e-mail). 
Electronic copies should be in WordPerfect format (in a version at 
least as recent as 6.0). Service will be considered timely if sent not 
later than 11:59 p.m. of the due date under our Subpart M rules. 
However, we also require the parties to submit a single signed hard 
copy of any such filings \70\ to the Rulemakings and Adjudications 
Branch, Office of the Secretary, U.S. Nuclear Regulatory Commission, 
11555 Rockville Pike, Room O-16-H-15, Rockville, MD 20852. As noted 
above, the fax number for this office is (301) 415-1101 and the e-mail 
address is [email protected].
---------------------------------------------------------------------------

    \70\ We draw the attention to the difference between this 
requirement and that of Subpart G, which provides that any service 
whether by fax or e-mail on the Secretary should be followed with an 
original and two conforming copies of the service by regular mail in 
accordance with 10 CFR 2.708(d).
---------------------------------------------------------------------------

VI. Conclusion

    For the reasons set forth above:
    (1) The license transfer adjudications involving FitzPatrick and 
Indian Point 3 license transfers are consolidated.
    (2) CAN's, Cortlandt's and the Association's petitions to intervene 
and requests for hearing are granted;
    (3) Westchester's petition for governmental participant status is 
granted;
    (4) The Association's and CAN's motions for stay are denied;
    (5) Cortlandt's motion to expand this adjudication's scope of 
review is denied;
    (6) CAN's motion for a Subpart G hearing is denied;
    (7) CAN and Cortlandt may formulate and submit a properly-supported 
financial qualifications issue within 20 days of the entry of a 
protective order.
    (8) The parties are required to inform the Commission of any court 
or administrative orders, settlements or business decisions that may in 
any way relate to, or render moot, part or all of the instant 
proceeding.
    (9) Within fifteen days of the issuance date of this order, the 
parties shall complete any necessary negotiations on a protective order 
regarding any proprietary data and shall submit a joint protective 
order to the Presiding Officer. If they are unsuccessful in negotiating 
such an order, they shall so inform the Presiding Officer by that date 
and shall indicate any areas in which they were able to agree.
    It is so ordered.

    Dated at Rockville, Maryland, this 27th day of November, 2000.

    For the Commission.\71\
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    \71\ Commissioner Dicus was not present for the affirmation of 
this Order. Had she been present, she would have affirmed her prior 
vote to approve this Order.
---------------------------------------------------------------------------

Annette L. Vietti-Cook,
Secretary of the Commission.
[FR Doc. 00-31875 Filed 12-13-00; 8:45 am]
BILLING CODE 7590-01-U