[Federal Register Volume 67, Number 194 (Monday, October 7, 2002)]
[Proposed Rules]
[Pages 62403-62410]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-25243]


 ========================================================================
 Proposed Rules
                                                 Federal Register
 ________________________________________________________________________
 
 This section of the FEDERAL REGISTER contains notices to the public of 
 the proposed issuance of rules and regulations. The purpose of these 
 notices is to give interested persons an opportunity to participate in 
 the rule making prior to the adoption of the final rules.
 
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 

  Federal Register / Vol. 67, No. 194 / Monday, October 7, 2002 / 
Proposed Rules  

[[Page 62403]]



NUCLEAR REGULATORY COMMISSION

10 CFR Parts 30, 40, and 70

RIN 3150-AG85


Financial Assurance Amendments for Materials Licensees

AGENCY: Nuclear Regulatory Commission.

ACTION: Proposed rule.

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SUMMARY: The Nuclear Regulatory Commission (NRC) is proposing to amend 
its regulations for financial assurance for certain materials licensees 
to bring the amount of financial assurance required more in line with 
current decommissioning costs. The objective of this proposed action is 
to maintain adequate financial assurance so that timely decommissioning 
can be carried out following shutdown of a licensed facility.

DATES: The comment period expires December 23, 2002. Comments received 
after this date will be considered if it is practical to do so, but the 
NRC is able to assure consideration only for comments received on or 
before this date.

ADDRESSES: Submit comments to: Secretary, U.S. Nuclear Regulatory 
Commission, Washington, DC 20555-0001, Attn: Rulemakings and 
Adjudications Staff.
    Deliver comments to 11555 Rockville Pike, Rockville, MD, between 
7:30 a.m. and 4:15 p.m. on Federal workdays.
    You may also provide comments via the NRC's interactive rulemaking 
Web site (http://ruleforum.llnl.gov). This site provides the capability 
to upload comments as files (any format) if your web browser supports 
that function. For information about the interactive rulemaking 
website, contact Ms. Carol Gallagher (301) 415-5905; e-mail 
[email protected].
    Certain documents related to this rulemaking, including comments 
received, may be examined at the NRC Public Document Room, Room O-1F23, 
11555 Rockville Pike, Rockville, MD. These same documents may also be 
viewed and downloaded electronically via the rulemaking website.
    The NRC maintains an Agencywide Document Access and Management 
System (ADAMS), which provides text and image files of NRC's public 
documents. These documents may be accessed through the NRC's Public 
Electronic Reading Room on the Internet at http://www.nrc.gov/reading-rm/adams.html. If you do not have access to ADAMS or if there are 
problems in accessing the documents located in ADAMS, contact the NRC 
Public Document Room (PDR) Reference staff at 1-800-397-4209, 301-415-
4737, or by e-mail to [email protected].

FOR FURTHER INFORMATION CONTACT: Clark Prichard, Office of Nuclear 
Material Safety and Safeguards, U.S. Nuclear Regulatory Commission, 
Washington, DC 20555-0001, telephone (301) 415-6203 e-mail, 
[email protected].

SUPPLEMENTARY INFORMATION:

Background

    The NRC regulations requiring financial assurance for 
decommissioning are designed to ensure that adequate funding will be 
available for timely decommissioning by licensees following shutdown of 
normal operations. The financial assurance regulations are part of the 
overall NRC strategy to maintain safety and protection of the public 
and the environment during and after decommissioning and 
decontamination of nuclear facilities.
    Financial assurance is composed of several parts: (1) Licensees for 
which financial assurance should be required must be identified; (2) 
the amount of financial assurance required for each licensee must be 
adequate to fund current decommissioning costs; and (3) appropriate 
financial assurance mechanisms (surety bonds, escrow accounts, parent 
or self-guarantee, etc.) must be required. The objective of this 
rulemaking is to maintain adequate financial assurance by addressing 
gaps in the current regulatory framework regarding (1) and (2) above.
    Under current decommissioning regulations, materials licensees 
using substantial quantities of nuclear materials must provide 
financial assurance for decommissioning (most materials licensees do 
not need to provide financial assurance because their possession limits 
are below the threshold for requiring financial assurance). NRC has 
approximately 4900 materials licensees of which approximately 10 
percent require financial assurance. The financial assurance 
requirements were established in 1988 as part of the decommissioning 
rulemaking (53 FR 24018; June 27, 1988). Revision to some of the 
financial assurance requirements for materials licensees are needed 
because there have been changes in decommissioning costs since that 
time. Also, experience has revealed that for certain types of 
licensees, such as waste brokers, special circumstances exist that 
require different financial assurance considerations.

Discussion

    This proposed rule would maintain assurance of adequate funding for 
timely decommissioning. The current financial assurance regulations do 
not provide adequate coverage of potential decommissioning costs for 
certain types of materials licensees, mainly due to large increases in 
decommissioning costs since the financial assurance regulations were 
put in place. Allowing these financial assurance coverage shortfalls to 
remain could increase the likelihood of inadequate funding for timely 
decommissioning.
    Inadequate/untimely funding of decommissioning could have adverse 
impacts on public health and safety, and protection of the environment. 
If a site is not decommissioned due to insufficient funds, there is an 
increased likelihood of contamination and/or exposure of members of the 
public. The changes to the regulations proposed here are focused on 
areas where the likelihood of inadequate funding relative to 
decommissioning costs is high. The proposed changes address situations 
where currently required amounts of financial assurance appear to be 
substantially less than decommissioning costs. The proposed changes 
would provide approximately $80 million in additional financial 
assurance.\1\
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    \1\ Staff estimate based on numbers of licensees using each of 
the 3 certification amounts.
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    These proposed amendments were developed prior to recent heightened 
concerns about security of nuclear material. Because the objective of 
the

[[Page 62404]]

amendments is timely decommissioning of nuclear facilities with 
appropriate disposal of radioactive materials, these amendments should 
also enhance security of nuclear materials.
    Failure to provide adequate financial assurance for decommissioning 
also has equity considerations. The potential costs to the public when 
it is required to cover the expense of cleanup of contaminated 
facilities where financial assurance is inadequate, must be considered. 
Equity considerations call for adequate financial assurance so that a 
licensee's decommissioning costs are borne by that licensee, not the 
Federal, State, or local government.
    The NRC has completed studies of financial assurance requirements 
for materials licensees. The studies were carried out by ICF, Inc., a 
contractor with extensive experience in financial assurance. The 
studies, ``Assessment of the Financial Assurance Requirements for Waste 
Broker Material Licensees,'' ICF, Inc., July 1999, and ``Analysis of 
Decommissioning Certification Amounts for Materials Licensees--Parts 
30, 40, and 70,'' ICF Consulting, December 2000, provide information 
that was used to develop this proposed rulemaking.\2\ In addition, 
Pacific Northwest National Laboratory (PNNL), which has extensive 
experience in analyzing decommissioning costs, has completed several 
reports on current decommissioning costs for various types of nuclear 
facilities. The PNNL reports, Revised Analysis of Decommissioning 
Reference Non-Fuel Cycle Facilities, draft NUREG/CR-6477, PNNL, 1996, 
and Technology, Safety, and Costs of Decommissioning a Reference Large 
Irradiator and Reference Sealed Sources, NUREG/CR-6280, PNNL, January 
1996, also form a basis for this proposed rule.\3\
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    \2\ These documents are available on NRC's interactive 
rulemaking Web site http://ruleforum.llnl.gov.
    \3\ These documents are available on NRC's interactive 
rulemaking Web site http://ruleforum.llnl.gov.
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Proposed Changes

    The changes being proposed are in four areas:
    (1) Large sealed source licensees--large irradiators--would no 
longer be able to use the $75,000 certification amount as a basis for 
financial assurance, and would have to base their financial assurance 
on a site-specific decommissioning cost estimate;
    (2) All waste broker licensees would have to provide financial 
assurance, would not be permitted to use the certification amounts, and 
would have to base their financial assurance on a site-specific 
decommissioning cost estimate;
    (3) The certification amounts for licensees would be increased by 
50 percent; and
    (4) Decommissioning cost estimates would have to be updated at 
least every 3 years.

Large Irradiators

    Large irradiator licensees engage in the industrial irradiation of 
material primarily for purposes of sterilization (e.g., food products 
and medical equipment). These large irradiators operate facilities that 
have a large number of sealed sources, with possession limits of 
several million curies. The NRC has approximately 10 irradiator 
licensees authorized for possession of 1 million curies or more. Under 
present financial assurance requirements, these licensees may use the 
$75,000 certification amount as a basis for financial assurance. 
Although this licensed radioactive material is all in the form of 
sealed sources, estimated current decommissioning costs for this type 
of facility, such as for source removal, shipping, and supplier 
handling charges, greatly exceed the $75,000 certification amount that 
they may use.
    PNNL's study of large irradiator decommissioning costs, Technology, 
Safety, and Costs of Decommissioning a Reference Large Irradiator and 
Reference Sealed Sources, NUREG/CR-6280, PNNL, January 1996, provides 
estimates of decommissioning costs under a number of scenarios. 
Estimated decommissioning costs for an irradiator facility with 1 
million curies of source activity are at least $128,000; for a facility 
with 2 million curies, estimated costs are at least $231,000. These 
cost estimates are for the least costly decommissioning scenarios, with 
all sources being returned to the supplier and no leakage of 
contamination.
    The NRC is proposing to put an upper limit on the size of a sealed 
source licensee able to continue to use the $75,000 certification 
amount. This proposed change would require a sealed source licensee 
with possession limits of over 1 million curies of Co-60, the 
radioactive material generally used by large irradiators, to base 
financial assurance on a decommissioning cost estimate. This facility-
specific cost estimate is likely to be higher than $75,000, and the 
licensee would incur higher financial assurance costs. However, the 
facility-specific cost estimate should provide a more accurate estimate 
of decommissioning costs.

Waste Brokers

    Waste broker licensees handle radioactive waste associated with or 
generated by other licensees and non-licensed entities. There is no 
definition of ``waste broker'' in existing NRC regulations and the term 
is commonly used to describe several different activities. These 
amendments would add a definition of ``waste broker'' to cover 
licensees that accept radioactive material for the purpose of 
processing, compacting, repackaging, or otherwise preparing it for 
disposal, or for storage. The NRC has approximately 15 waste broker 
licensees, of which eight require financial assurance under current 
regulations.\4\ Many waste broker licensees also conduct other types of 
licensed activities as part of their overall business. The NRC 
financial assurance regulations treat waste brokers in the same way as 
other materials licensees; there are no special financial assurance 
requirements applicable only to waste brokers.
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    \4\ ``Assessment of the Financial Assurance Requirements for 
Waste Broker Material Licensees,'' ICF Consulting, 1999, p. 6.
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    The NRC has conducted an analysis of the adequacy of financial 
assurance requirements for waste brokers. The ICF report, ``Assessment 
of the Financial Assurance Requirements for Waste Broker Material 
Licensees,'' ICF, Inc., July 1999, concludes that waste brokers engage 
in fundamentally different types of activities than other materials 
licensees, and require treatment appropriate to these activities.
    From the viewpoint of financial assurance, waste broker activities 
are unique in that: (1) Waste brokers are likely to have radioactive 
wastes generated by other licensees, and the inventory of waste a 
broker will have onsite at any time may fluctuate considerably and be 
difficult to predict; and (2) waste brokers have a financial interest 
in maximizing the amount of radioactive waste that they handle--waste 
broker revenues are directly correlated to the amount of waste 
accepted.
    The disposal costs of waste inventories are very high--much greater 
than when the decommissioning regulations were promulgated. The current 
financial assurance regulations do not consider the costs of disposing 
of significant volumes of waste generated outside the decommissioning 
process, such as inventories of brokered waste. Waste brokers may 
currently maintain a level of financial assurance that is inadequate 
for disposal of waste inventories. Charges for disposal of waste at 
low-level waste disposal

[[Page 62405]]

facilities are based on the volume of waste disposed and also on the 
level of activity (e.g., quantity of curies) of the waste. The 
possession limits that determine what level of financial assurance a 
waste broker licensee must have are based on the quantity of curies of 
material possessed, not volume of material possessed. A waste broker 
that must dispose of large volumes of relatively low activity waste 
would be subject to substantial waste disposal charges. That same waste 
broker might have an inadequate amount of financial assurance to pay 
these charges because the financial assurance requirements are based 
only on curie level.
    The 1988 financial assurance regulations made no special provision 
for waste brokers. However, it is now clear that the activities of a 
waste broker licensee have very different implications for 
decommissioning costs than is the case for other types of materials 
licensees. For example, a laboratory using radioactive materials in 
making products will have a licensed possession limit based on the 
amount of radioactive materials in use at the facility. Most of the 
inventory of radioactive material will pass out of the licensee's 
possession as products are sold and shipped to users. Even in the case 
of bankruptcy and abrupt shutdown of operations, the product of the 
laboratory can most likely be sold or transferred. Decommissioning 
activities will consist of decontamination of the facility and some 
limited waste disposal. On the other hand, a waste broker having 
similar possession limits has limited options to reduce its inventory 
of radioactive material (waste) usually by disposal at a radioactive 
waste disposal facility. Thus, decommissioning costs can be 
substantially higher for a waste broker than for another type of 
licensee with similar possession limits.
    The NRC is proposing that all waste broker licensees be required to 
have financial assurance, and to base financial assurance on a 
facility-specific decommissioning cost estimate that takes into account 
other factors such as actual volume of material in addition to 
possession limits in curies.

Certification Amounts

    The amount of financial assurance that must be provided can be 
based on either: (1) A facility-specific decommissioning cost estimate 
provided by the licensee in a decommissioning funding plan;\5\ or (2), 
one of several dollar amounts (certification amounts) specified in the 
regulations. The certification amounts are based on possession limits, 
and range from $75,000 for sealed source licensees to $750,000 for 
licensees possessing large quantities of unsealed material. At present, 
about 60 percent of materials licensees required to have financial 
assurance use the certification amounts. Which certification amount is 
required of a licensee depends on the possession limits for radioactive 
materials applicable to that license.
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    \5\ For some types of licensees using very large amounts of 
unsealed radioactive material, a facility-specific cost estimate 
must be used.
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    The present certification amounts are based on decommissioning cost 
estimates that are now approximately 15 years old. When the 
decommissioning rule was established, it was expected that periodic 
adjustments to the certification amounts would be needed as 
decommissioning costs changed over time. NRC has reviewed current 
decommissioning cost information and is proposing adjustments to the 
certification amounts. General inflation since 1988, as measured by the 
Gross Domestic Product price deflator (price index), has resulted in 
current prices that are approximately 40 percent higher than they were 
when the final decommissioning rule was published.\6\ Specific 
information on decommissioning costs also shows a substantial increase. 
NRC regulations for decommissioning of nuclear power reactor licensees 
at 10 CFR 50.75 contain a cost adjustment factor for licensees to 
update the minimum amount of financial assurance required. This 
adjustment factor, which takes into account labor, energy, and waste 
disposal costs, shows a minimum increase of approximately 65 percent in 
reactor decommissioning costs from 1986 to 2000.\7\ A major factor 
underlying the increase is waste disposal charges, which have gone up 
by at least 120 percent during this period. The increase is much 
greater in certain geographic areas--disposal costs vary considerably 
according to disposal site.\8\
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    \6\ National Income and Product Accounts Tables, Bureau of 
Economic Analysis, U.S. Department of Commerce.
    \7\ Report on Waste Burial Charges, NUREG-1307, Revision 9, U.S. 
Nuclear Regulatory Commission, 2000, p.6. Copies of NUREG-1307, 
Revision 9 are available for inspection or copying for a fee from 
the NRC Public Document Room at O-1F23, 11555 Rockville Pike, 
Rockville, MD. Copies may be purchased at current rates from the 
U.S. Government Printing Office, P.O. Box 370892, Washington, DC 
20402-9328 (telephone (202 )512-2249); or from the National 
Technical Information Service by writing NTIS at 5285 Port Royal 
Road, Springfield, VA 22161.
    \8\ NUREG-1307, Revision 9, p. 6.
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    A study by PNNL for NRC on costs of decommissioning for six 
different types of reference non-fuel cycle nuclear materials licensees 
concludes that decommissioning costs increased by 34-66 percent between 
1986 and 1996.\9\ An ICF study found that estimates of decommissioning 
costs for a majority of a sample of Part 30 licensees using 
certification amounts exceed the applicable certification amount by a 
substantial margin.\10\
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    \9\``Revised Analysis of Decommissioning Reference Non-Fuel 
Cycle Facilities, draft NUREG/CR-6477, Pacific Northwest National 
Laboratories, 1996, p. iv.
    \10\ ``Analysis of Decommissioning Certification Amounts for 
Materials Licensees (Parts 30, 40, and 70),'' ICF Consulting, 2000, 
p. 36.
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    The NRC is proposing to raise all certification amounts by 50 
percent. The proposed certification amounts would be $113K for sealed 
source licensees, and $225K and $1,125K for licensees using unsealed 
sources. The revisions to the certification amounts proposed in this 
notice are aimed at keeping the certification amounts reasonably in 
accordance with current decommissioning costs for a typical licensee 
that has possession limits that allow it to use that particular 
certification amount.
    The certification amounts were never intended to be an exact 
measure of decommissioning costs for all licensees. The universe of 
materials licensees required to have financial assurance is composed of 
very diverse types of operations. Actual decommissioning costs vary 
considerably, depending on extent and type of activities, and 
quantities and types of radionuclides in use. The NRC recognizes that 
the applicable certification amounts for any one particular licensee 
may be greater than the amount required to decommission that licensee's 
facility. In these cases, the NRC encourages a licensee to submit a 
facility specific decommissioning cost estimate as a basis for 
financial assurance.
    The certification amounts are designed to provide qualifying 
licensees a method for establishing a basis for the amount of financial 
assurance needed without devoting the resources needed to develop 
detailed decommissioning cost estimates. The NRC believes that the 
certification amounts serve a useful purpose by allowing certain 
licensees using relatively small quantities of radioactive materials to 
establish financial assurance in a simple, cost-effective way. At issue 
is the assurance of timely funding of decommissioning and the cost 
burden on licensees of providing this assurance. In comparing the 
relative merits of using a facility-specific decommissioning cost 
estimate or a certification amount, the tradeoff

[[Page 62406]]

involved is the benefit of having the amount of financial assurance 
required more closely track actual decommissioning costs against the 
additional expense of developing a decommissioning cost estimate. The 
NRC would also require more resources for review of a financial 
assurance submission based on a decommissioning cost estimate than for 
review of a submission based on a certification amount.

Requirement for Updating Decommissioning Cost Estimates

    The existing financial assurance regulations do not contain a 
specific requirement for updating cost estimates in decommissioning 
funding plans after a certain number of years. Existing regulatory 
language only refers to ``adjusting cost estimates and associated 
funding levels periodically over the life of the facility.'' The NRC 
believes that a more specific requirement is warranted and is proposing 
to require updated decommissioning cost estimates at least every 3 
years. Decommissioning costs, especially waste disposal costs, can 
change significantly over a relatively short time period. For example, 
the decommissioning cost estimate for a large materials licensee 
increased from approximately $40 million in 2001 to over $67 million in 
2002. Even requiring updates at least every 3 years would not 
completely address this problem. However, by requiring an update of 
decommissioning cost estimates at least every 3 years, the NRC is 
attempting to prevent a large gap between actual decommissioning costs 
and licensee decommissioning cost estimates from developing. This 
proposed change is intended to assure adequate financial coverage of 
actual decommissioning costs.

Cost Impacts on Licensees

    The proposed requirements would have significant cost impacts for 
large irradiators, waste brokers, and licensees that use the 
certification amounts. The NRC has only a small number of large 
irradiators and waste brokers, but approximately 300 NRC materials 
licensees use the certification amounts. The NRC estimates that 
additional annual costs of providing financial assurance for all 
affected licensees would be approximately $1.2 million. Most of this 
would be attributable to the increase in the certification amounts. In 
addition, one-time costs of approximately $60K-$250K would result from 
additional licensees having to prepare decommissioning cost estimates. 
Also, licensees that base financial assurance on a decommissioning cost 
estimate would incur the additional costs of having to prepare more 
frequent decommissioning cost updates to comply with the proposed 
requirement for updated cost estimates every 3 years. More detailed 
information on cost impacts is contained in the Regulatory Analysis 
cited in this notice. The NRC seeks comments from stakeholders on its 
analysis of the estimated benefits and costs for each class of 
licensee.
    As stated previously, the benefit of the proposed rulemaking is the 
assurance of adequate funding for timely decommissioning. Updates are 
needed in the current financial assurance regulations that would 
decrease the likelihood of inadequate funding for timely 
decommissioning. The effect of inadequate/untimely funding of 
decommissioning may have adverse impacts on public health and safety. 
If a site is not decommissioned due to insufficient funds, there is an 
increased likelihood of contamination and/or exposure of members of the 
public. In addition, adequate financial assurance would prevent 
situations where Federal, State, or local governments bear the cost of 
decommissioning, rather than site operators. This proposed action would 
require licensees to provide an additional approximately $80 million in 
financial assurance coverage.

Implementation

    The NRC plans to implement these requirements, if finalized, in a 
way that minimizes the burden on licensees and regulators. Licensees 
would be given a reasonable period of time to submit new 
decommissioning cost estimates and to obtain any additional financial 
assurance that may be required. The NRC is considering establishing 
different effective dates for revised financial assurance requirements, 
depending on the type of licensee, so that new financial assurance 
submittals would not all be filed at one time. For example, licensees 
currently using the $750K certification amount would be required to 
obtain additional financial assurance to comply with the proposed 
$1,125 certification amount within 12 months of the effective date of a 
final rule. Licensees currently using the $75K or $150K certification 
amounts would be required to obtain additional financial assurance to 
comply with the proposed $113K or $225K certification amounts within 18 
months of the effective date of a final rule. In either case, these 
licensees could choose the option of basing financial assurance on a 
decommissioning cost estimate.
    Licensees that would no longer be able to use the certification 
amounts, such as large irradiators and waste brokers, would be allowed 
up to 24 months to submit a decommissioning cost estimate. The NRC 
encourages public comments on implementation issues and concerns.

Discussion of Proposed Amendments by Section

Section 30.4 Definitions

    A definition of the term ``waste broker'' is added.

Section 30.35 Financial Assurance and Recordkeeping for Decommissioning

    Paragraph (a) is amended to require licensees possessing large 
numbers of sealed sources to base financial assurance on a 
decommissioning funding plan. Amended Sec.  30.35(c)(2) revises the 
certification amount. A new Sec.  30.35(c)(5) would require waste 
broker licensees to base financial assurance on a site-specific 
decommissioning cost estimate. Amended Sec.  30.35(d) would increase 
the certification amounts by 50 percent--proposed new certification 
amounts would be $113K, $225K, and $1,125K. Amended Sec.  30.35(e) 
would require that decommissioning funding plans be updated at least 
every 3 years.

10 CFR 40.36 Financial Assurance and Recordkeeping

    Amended Sec.  40.36(b)(2) would increase the applicable 
certification amount by 50 percent. Amended Sec.  40.36(c)(2) revises 
the certification amount. Amended Sec.  40.36(d) would require that 
decommissioning funding plans be updated at least every 3 years.

10 CFR 70.25 Financial Assurance and Recordkeeping for Decommissioning

    Amended Sec.  70.25(c)(2) revises the certification amount. Amended 
Sec.  70.25(d) would increase the applicable certification amount by 50 
percent. Revised Sec.  70.25(e) would require that decommissioning 
funding plans be updated at least every 3 years.

Agreement State Compatibility

    Under the ``Policy Statement on Adequacy and Compatibility of 
Agreement State Programs'' that became effective on September 3, 1997 
(62 FR 46517), NRC program elements (including regulations) are placed 
into four compatibility categories. In addition, NRC program elements 
also can be identified as having particular health and safety 
significance or as being reserved solely to the NRC. The compatibility 
categories of the financial

[[Page 62407]]

assurance regulations are not being changed in the proposed rulemaking.
    The sections of 10 CFR parts 30, 40, and 70 dealing with financial 
assurance that are being changed and their respective compatibility 
categories are as follows:

Section 30.35 Financial Assurance and Recordkeeping for Decommissioning

    Compatibility category D, except D/ Health and Safety--paragraphs 
(a), (b), (d), and (g).
    States are given flexibility to allow different dollar amounts 
based upon jurisdiction and local conditions. The Health and Safety 
designation for paragraph (g) is warranted because of the requirement 
for transfer of certain records (e.g., spills or spread of 
contamination) important for decommissioning to a subsequent licensee 
at the same facility.

Section 40.36 Financial Assurance and Recordkeeping for Decommissioning

    Compatibility category D--paragraphs (c) and (e). Category D/Health 
and Safety--paragraphs (a), (b), (d), and (f).
    States have the flexibility to specify different dollar amounts 
based on jurisdiction and local conditions. The Health and Safety 
designation for paragraph (f) is warranted because of the requirement 
for transfer of certain records (e.g., spills or spread of 
contamination) important for decommissioning to a subsequent licensee 
at the same facility.

Section 70.25 Financial Assurance and Recordkeeping for Decommissioning

    Compatibility category D except (a) is NRC, and D/Health and 
Safety--paragraphs (b), (d), and (g).
    States have the flexibility to specify different dollar amounts 
based on jurisdiction and local conditions. Paragraph (a) addresses 
areas reserved to the NRC because it concerns uranium enrichment 
facilities and special nuclear materials in quantities sufficient to 
form a critical mass.

Plain Language

    The Presidential Memorandum dated June 1, 1998, entitled ``Plain 
Language in Government Writing'' directed that the Government's writing 
be in plain language. The NRC requests comments on this proposed rule 
specifically with respect to the clarity and effectiveness of the 
language used. Comments should be sent to the address listed under the 
heading ADDRESSES above.

Voluntary Consensus Standards

    The National Technology Transfer Act of 1995 (Pub. L. 104-113) 
requires that Federal agencies use technical standards that are 
developed or adopted by voluntary consensus standards bodies unless the 
use of such a standard is inconsistent with applicable law or otherwise 
impractical. In this proposed rule, the NRC would make revisions to 
certain financial assurance requirements for materials licensees. 
Financial assurance requirements are not standards that have been 
established by any voluntary consensus organizations.

Environmental Assessment and Finding of No Significant Environmental 
Impact: Availability

    The Commission has determined under the National Environmental 
Policy Act of 1969, as amended, and the Commission's regulations in 
Subpart A of 10 CFR part 51, not to prepare an environmental impact 
statement for this proposed rule because the Commission has concluded 
on the basis of an environmental assessment that this proposed rule, if 
adopted, would not be a major Federal action significantly affecting 
the quality of the human environment. These proposed amendments would 
revise financial assurance requirements for certain materials 
licensees. The amendments would not lead to any increase in the effect 
on the environment of the decommissioning activities considered in the 
final rule published on June 27, 1988 (53 FR 24018), as analyzed in the 
Final Generic Environmental Impact Statement on Decommissioning of 
Nuclear Facilities (NUREG-0586, August 1988).\11\ Actions conducted 
under this rule would not introduce any impacts on the environment not 
previously considered by the NRC.
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    \11\ Copies of NUREG-0586 are available for inspection or 
copying for a fee from the NRC Public Document Room at O-1F23, 11555 
Rockville Pike, Rockville, MD. Copies may be purchased at current 
rates from the U.S. Government Printing Office, P.O. Box 370892, 
Washington, DC 20402-9328 (telephone (202 ) 512-2249); or from the 
National Technical Information Service by writing NTIS at 5285 Port 
Royal Road, Springfield, VA 22161.
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    The determination of this environmental assessment is that there 
will be no significant adverse impact to the quality of the human 
environment from this action. This action should provide a positive 
impact by providing additional assurance of timely decommissioning. 
However, the general public should note that the NRC welcomes public 
participation. Comments on any aspect of the Environmental Assessment 
may be submitted to the NRC as indicated under the ADDRESSES heading.
    The NRC has sent a copy of this notice of proposed rulemaking, 
which includes the environmental assessment, to every State Liaison 
Officer and requested their comments. It may be examined at the NRC 
Public Document Room, O-1F23, 11555 Rockville Pike, Rockville, MD. 
Single copies are available from Clark Prichard, telephone (301) 415-
6203, e-mail, [email protected], of the Office of Nuclear Material Safety and 
Safeguards.

Paperwork Reduction Act Statement

    This proposed rule amends information collection requirements 
contained in 10 CFR parts 30, 40, and 70 that are subject to the 
Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.). These 
information collection requirements have been submitted to the Office 
of Management and Budget for review and approval. Existing requirements 
were approved by the Office of Management and Budget, approval numbers 
3150-0009, -0017, and -0020.
    The burden to the public for the information collections contained 
in 10 CFR part 30 is estimated to average 10.4 hours per response, the 
burden for the information collections contained in 10 CFR part 40 is 
estimated to average 7.3 hours per response, and the burden for the 
information collections contained in 10 CFR part 70 is estimated to 
average 7.5 hours per response. This includes the time for reviewing 
instructions, searching existing data sources, gathering and 
maintaining the data needed, and completing and reviewing the 
information collection. The U.S. Nuclear Regulatory Commission is 
seeking public comment on the potential impact of the information 
collections contained in the proposed rule and on the following issues:
    1. Is the proposed information collection necessary for the proper 
performance of the functions of the NRC, including whether the 
information will have practical utility?
    2. Is the estimate of burden accurate?
    3. Is there a way to enhance the quality, utility, and clarity of 
the information to be collected?
    4. How can the burden of the information collection be minimized, 
including the use of automated collection techniques?
    Send comments on any aspect of these proposed information 
collections, including suggestions for reducing the burden, to the 
Records Management Branch (T-6 E6), U.S. Nuclear Regulatory Commission, 
Washington, DC 20555-0001, or by Internet

[[Page 62408]]

electronic mail to [email protected]; and to the Desk Officer, 
Office of Information and Regulatory Affairs, NEOB-10202, (3150-0017, -
0020, and -0009), Office of Management and Budget, Washington, DC 
20503.
    Comments to OMB on the information collections or on the above 
issues should be submitted by November 6, 2002. Comments received after 
this date will be considered if it is practical to do so, but assurance 
of consideration cannot be given to comments received after this date.

Public Protection Notification

    The NRC may not conduct or sponsor, and a person is not required to 
respond to, a request for information or an information collection 
requirement unless the requesting document displays a currently valid 
OMB control number.

Regulatory Analysis

    The Commission has prepared a draft regulatory analysis on this 
proposed regulation. The analysis examines the costs and benefits of 
the alternatives considered by the Commission.
    The Commission requests public comment on the draft regulatory 
analysis. Comments on the draft analysis may be submitted to the NRC as 
indicated under the ADDRESSES heading. The analysis is available for 
inspection in the NRC Public Document Room, 11555 Rockville Pike, 
Rockville, MD. Single copies of the regulatory analysis are available 
from Clark Prichard, telephone (301) 415-6203, e-mail, [email protected] of 
the Office of Nuclear Material Safety and Safeguards.

Regulatory Flexibility Certification

    In accordance with the Regulatory Flexibility Act of 1980 (5 U.S.C. 
605(b)), the Commission certifies that this rule would not, if 
promulgated, have a significant economic impact on a substantial number 
of small entities. Some licensees affected by this proposed action may 
fall within the definition of ``small entities'' set forth in the 
Regulatory Flexibility Act or the Small Business Size Standards set out 
in regulations issued by the Small Business Administration at 13 CFR 
part 121. However, while the proposed rule would change the financial 
assurance requirements for these licensees, a licensee may base its 
financial assurance on a facility-specific decommissioning cost 
estimate. No licensee would be required to provide financial assurance 
in excess of what is needed to cover decommissioning costs. Increases 
in financial assurance amounts required are only the amounts necessary 
to maintain adequate financial assurance to cover increased 
decommissioning costs. The regulatory analysis cited for this proposed 
action contains estimates of cost impacts on different types of 
licensees.
    The NRC is seeking public comment on the potential impact of the 
proposed rule on small entities. The NRC particularly desires comment 
from small entities (i.e., small businesses, small organizations, and 
small jurisdictions under the Regulatory Flexibility Act) as to how the 
proposed regulations will affect them and how the regulations may be 
tiered or otherwise modified to impose less stringent requirements on 
small entities while still adequately protecting the public health and 
safety. Those small entities that offer comments on how the regulations 
could be modified should specifically discuss--
    (a) The size of their business and how the proposed regulations 
would result in a significant economic burden upon them as compared to 
large organizations in the same business community.
    (b) How the proposed regulations could be modified to take into 
account their differing needs or capabilities.
    (c) The benefits that would accrue, or the detriments that would be 
avoided, if the proposed regulations were modified as suggested by the 
commenter.
    (d) How the proposed regulations, as modified, would more closely 
equalize the impact of NRC regulations or create more equal access to 
the benefits of Federal programs as opposed to providing special 
advantages to any individuals or groups; and
    (e) How the proposed regulations, as modified, would still 
adequately protect the public health and safety.
    The comments should be sent to the Secretary of the Commission, 
U.S. Nuclear Regulatory Commission, Washington, DC 20555-0001, Attn: 
Rulemakings and Adjudications Staff.

Backfit Analysis

    There are no backfit requirements in 10 CFR Parts 30 and 40, and, 
in accordance with the effective date note regarding implementation of 
Sec.  70.76, the provisions of 10 CFR 70.76 on backfitting have not yet 
gone into effect. Therefore, a backfit analysis is not required. 
However, the burdens and the benefits associated with this proposed 
rule are addressed in this notice and in the Regulatory Analysis.

List of Subjects

10 CFR Part 30

    Byproduct material, Criminal penalties, Government contracts, 
Intergovernmental relations, Isotopes, Nuclear materials, Radiation 
protection, Reporting and recordkeeping requirements.

10 CFR Part 40

    Criminal penalties, Government contracts, Hazardous materials 
transportation, Nuclear materials, Reporting and recordkeeping 
requirements, Source material, Uranium.

10 CFR Part 70

    Criminal penalties, Hazardous materials transportation, Material 
control and accounting, Nuclear materials, Packaging and containers, 
Radiation protection, Reporting and recordkeeping requirements, 
Scientific equipment, Security measures, Special nuclear material.

    For the reasons set out in the preamble and under the authority of 
the Atomic Energy Act of 1954, as amended; the Energy Reorganization 
Act of 1974, as amended; and 5 U.S.C. 553; the NRC is proposing to 
adopt the following amendments to 10 CFR parts 30, 40, and 70.

PART 30--RULES OF GENERAL APPLICABILITY TO DOMESTIC LICENSING OF 
BYPRODUCT MATERIAL

    1. The authority citation for Part 30 continues to read as follows:

    Authority: Secs. 81, 82, 161, 182, 183, 186, 68 Stat. 935, 948, 
953, 954, 955, as amended, sec. 234, 83 Stat. 444, as amended (42 
U.S.C. 2111, 2112, 2201, 2232, 2233, 2236, 2282); secs. 201, as 
amended, 202, 206, 88 Stat. 1242, as amended, 1244, 1246 (42 U.S.C. 
5841, 5842, 5846).
    Section 30.7 also issued under Pub. L. 95-601, sec. 10, 92 Stat. 
2951 as amended by Pub. L. 102-486, sec. 2902, 106 Stat. 3123, (42 
U.S.C. 5851). Section 30.34(b) also issued under sec.184, 68 Stat. 
954, as amended (42 U.S.C. 2234). Section 30.61 also issued under 
sec. 187, 68 Stat. 955 (42 U.S.C. 2237).

    2. In Sec.  30.4, a definition is added in alphabetical order to 
read as follows:


Sec.  30.4  Definitions.

* * * * *
    Waste broker means any licensee that collects or accepts 
radioactive material from other entities for the purpose of processing, 
compacting, repackaging, or otherwise preparing it for disposal, or for 
storage.
* * * * *
    3. In Sec.  30.35, paragraphs (a), (c)(2), (d), and (e) are revised 
and a new paragraph (c)(5) is added to read as follows:


Sec.  30.35  Financial assurance and recordkeeping for decommissioning.

    (a)(1) Each applicant for a specific license authorizing possession 
and use

[[Page 62409]]

of unsealed byproduct material of half-life greater than 120 days and 
in quantities exceeding 105 times the applicable quantities 
set forth in appendix B to part 30 shall submit a decommissioning 
funding plan as described in paragraph (e) of this section. The 
decommissioning funding plan must also be submitted when a combination 
of isotopes is involved if R divided by 105 is greater than 
1 (unity rule), where R is defined here as the sum of the ratios of the 
quantity of each isotope to the applicable value in appendix B to part 
30.
    (2) Each holder of, or applicant for, any specific license 
authorizing possession and use of sealed sources or plated foils of 
half-life greater than 120 days and in quantities exceeding 
1012 times the applicable quantities set forth in appendix B 
to part 30 (or when a combination of isotopes is involved if R, as 
defined in Sec.  30.35(a)(1), divided by 1012 is greater 
than 1), shall submit a decommissioning funding plan as described in 
paragraph (e) of this section.
* * * * *
    (c) * * *
    (2) Each holder of a specific license issued before July 27, 1990, 
and of a type described in paragraph (a) of this section shall submit a 
decommissioning funding plan as described in paragraph (e) of this 
section or a certification of financial assurance for decommissioning 
in an amount at least equal to $1,125,000 in accordance with the 
criteria set forth in this section. If the licensee submits the 
certification of financial assurance rather than a decommissioning 
funding plan, the licensee shall include a decommissioning funding plan 
in any application for license renewal.
* * * * *
    (5) Waste brokers, i.e., each applicant or holder of a specific 
license that collects or accepts radioactive material from other 
entities for the purpose of processing, compaction, repackaging, or 
otherwise preparing it for disposal, or for storage, must provide 
financial assurance in an amount based on a decommissioning funding 
plan as described in paragraph (e) of this section. The decommissioning 
funding plan must include the cost of disposal of the maximum amount 
(curies) of radioactive material permitted by license, and the cost of 
disposal of the maximum quantity, by volume, of radioactive material 
present at the licensee's facility at any time, in addition to the cost 
to remediate the licensee's site to meet the license termination 
criteria of 10 CFR part 20.
    (d) Table of required amounts of financial assurance for 
decommissioning by quantity of material. Licensees having possession 
limits exceeding the upper bounds of this table must base financial 
assurance on a decommissioning funding plan.


greater than 10\4\ but less than or equal to 10\5\ times      $1,125,000
 the applicable quantities of appendix B to part 30 in
 unsealed form. (For a combination of isotopes, if R, as
 defined in Sec.   30.35(a)(1), divided by 104 is greater
 than 1 but R divided by 10\5\ is less than or equal to 1).
greater than 10\3\ but less than or equal to 10\4\ times        $225,000
 the applicable quantities of appendix B to part 30 in
 unsealed form. (For a combination of isotopes, if R, as
 defined in Sec.   30.35(a)(1), divided by 10\3\ is greater
 than 1 but R divided by 10\4\ is less than or equal to 1).
greater than 10\10\ but less than or equal to 10\12\ times      $113,000
 the applicable quantities of appendix B to part 30 in
 sealed sources or plated foils. (For a combination of
 isotopes, if R, as defined in Sec.   30.35(a)(1), divided
 by 10\10\ is greater than 1, but R divided by 10\12\ is
 less than or equal to 1)..................................
 


    (e) Each decommissioning funding plan must contain a cost estimate 
for decommissioning and a description of the method of assuring funds 
for decommissioning from paragraph (f) of this section, including means 
for adjusting cost estimates and associated funding levels periodically 
over the life of the facility. Cost estimates must be adjusted at 
intervals not to exceed three years. The decommissioning funding plan 
must also contain a certification by the licensee that financial 
assurance for decommissioning has been provided in the amount of the 
cost estimate for decommissioning and a signed original of the 
financial instrument obtained to satisfy the requirements of paragraph 
(f) of this section.
* * * * *

PART 40--DOMESTIC LICENSING OF SOURCE MATERIAL

    4. The authority citation for Part 40 continues to read as follows:

    Authority: Secs. 62, 63, 64, 65, 81, 161, 182, 183, 186, 68 
Stat. 932, 933, 935, 948, 953, 954, 955, as amended, secs. 
11e(2),83, 84, Pub. L. 95-604, 92Stat. 3033, as amended, 3039, sec. 
234, 83 Stat. 444, as amended (42 U.S.C. 2014(e)(2), 2092, 2093, 
2094,2095, 2111, 2113, 2114, 2201, 2232, 2233, 2236, 2282); sec. 
274, Pub. L. 86-373, 73 Stat. 688 (42 U.S.C. 2021); secs. 201, as 
amended, 202, 206, 88 Stat. 1242, as amended, 1244, 1246 (42 U.S.C. 
5841, 5842, 5846); sec. 275, 92 Stat. 3021, as amended by Pub. L. 
97-415, 96 Stat. 2067 (42 U.S.C. 2022); sec. 193, 104 Stat. 2835, as 
amended by Pub. L. 104-134, 110 Stat. 1321, 1321-349 (42 U.S.C. 
2243).
    Section 40.7 also issued under Pub. L. 95-601, sec. 10, 92 Stat. 
2951 (42 U.S.C. 5851). Section 40.31(g) also issued under sec. 122, 
68 Stat. 939 (42 U.S.C. 2152). Section 40.46 also issued under sec. 
184, 68 Stat. 954, as amended (42 U.S.C. 2234). Section 40.71 also 
issued under sec. 187, 68 Stat. 955 (42 U.S.C. 2237).

    5. In Sec.  40.36, paragraphs (b)(2), (c)(2), and (d) are revised 
to read as follows:


Sec.  40.36  Financial assurance and recordkeeping for decommissioning.

* * * * *
    (b) * * *
    (2) Submit a certification that financial assurance for 
decommissioning has been provided in the amount of $225,000 using one 
of the methods described in paragraph (e) of this section. For an 
applicant, this certification may state that the appropriate assurance 
will be obtained after the application has been approved and the 
license issued but before the receipt of licensed material. If the 
applicant defers execution of the financial instrument until after the 
license has been issued, a signed original of the financial instrument 
obtained to satisfy the requirements of paragraph (e) of this section 
must be submitted to NRC prior to receipt of licensed material. If the 
applicant does not defer execution of the financial instrument , the 
applicant shall submit to NRC, as part of the certification, a signed 
original of the financial instrument obtained to satisfy the 
requirements of paragraph (e) of this section.
    (c) * * *
    (2) Each holder of a specific license issued before July 27, 1990, 
and of a type described in paragraph (a) of this section shall submit a 
decommissioning funding plan as described in paragraph (d) of this 
section or a certification of financial assurance for decommissioning 
in an amount at least equal to $1,125,000 in accordance with the 
criteria set forth in this section. If the licensee submits the 
certification of financial assurance rather than a decommissioning 
funding plan, the licensee shall include a decommissioning funding plan 
in any application for license renewal.
* * * * *
    (d) Each decommissioning funding plan must contain a cost estimate 
for decommissioning and a description of

[[Page 62410]]

the method of assuring funds for decommissioning from paragraph (e) of 
this section, including means for adjusting cost estimates and 
associated funding levels periodically over the life of the facility. 
Cost estimates must be adjusted at intervals not to exceed three years. 
The decommissioning funding plan must also contain a certification by 
the licensee that financial assurance for decommissioning has been 
provided in the amount of the cost estimate for decommissioning and a 
signed original of the financial instrument obtained to satisfy the 
requirements of paragraph (e) of this section.
* * * * *

PART 70--DOMESTIC LICENSING OF SPECIAL NUCLEAR MATERIAL

    6. The authority citation for Part 70 continues to read as follows:

    Authority: Secs. 51, 53, 161, 182, 183, 68 Stat. 929, 930, 948, 
953, 954, as amended, sec. 234, 83 Stat. 444, as amended, (42 U.S.C. 
2071, 2073, 2201, 2232, 2233, 2282, 2297f); secs. 201, as amended, 
202, 204, 206, 88 Stat. 1242, as amended, 1244, 1245, 1246 (42 
U.S.C. 5841, 5842, 5845, 5846). Sec. 193, 104 Stat. 2835 as amended 
by Pub. L. 104-134, 110 Stat. 1321, 1321-349 (42 U.S.C. 2243).

    Sections 70.1(c) and 70.20a(b) also issued under secs. 135, 141, 
Pub. L. 97-425, 96 Stat. 2232, 2241 (42 U.S.C. 10155, 10161). 
Section 70.7 also issued under Pub. L. 95-601, sec. 10, 92 Stat. 
2951 (42 U.S.C. 5851). Section 70.21(g) also issued under sec. 122, 
68 Stat. 939 (42 U.S.C. 2152). Section 70.31 also issued under sec. 
57d, Pub. L. 93-377, 88 Stat. 475 (42 U.S.C. 2077). Sections 70.36 
and 70.44 also issued under sec. 184, 68 Stat. 954, as amended (42 
U.S.C. 2234). Section 70.81 also issued under secs. 186, 187, 68 
Stat. 955 (42 U.S.C. 2236, 2237). Section 70.82 also issued under 
sec. 108, 68 Stat. 939, as amended (42 U.S.C. 2138).

    7. In Sec.  70.25, paragraphs (c)(2), (d), and (e) are revised to 
read as follows:


Sec.  70.25  Financial assurance and recordkeeping for decommissioning.

* * * * *
    (c) * * *
    (2) Each holder of a specific license issued before July 27, 1990, 
and of a type described in paragraph (a) of this section shall submit a 
decommissioning funding plan as described in paragraph (e) of this 
section or a certification of financial assurance for decommissioning 
in an amount at least equal to $1,125,000 in accordance with the 
criteria set forth in this section. If the licensee submits the 
certification of financial assurance rather than a decommissioning 
funding plan, the licensee shall include a decommissioning funding plan 
in any application for license renewal.
* * * * *
    (d) Table of required amounts of financial assurance for 
decommissioning by quantity of material. Licensees having possession 
limits exceeding the upper bounds of this table must base financial 
assurance on a decommissioning funding plan.


greater than 10\4\ but less than or equal to 10\5\ times      $1,125,000
 the applicable quantities of appendix B to part 30. (For a
 combination of isotopes, if R, as defined in Sec.
 70.25(a), divided by 10\4\ is greater than 1 but R divided
 by 10\5\ is less than or equal to 1.).....................
greater than 10\3\ but less than or equal to 10\4\ times        $225,000
 the applicable quantities of appendix B to part 30. (For a
 combination of isotopes, if R, as defined in Sec.
 70.25(a), divided by 10\3\ is greater than 1 but R divided
 by 10\4\ is less than or equal to 1.).....................
 


    (e) Each decommissioning funding plan must contain a cost estimate 
for decommissioning and a description of the method of assuring funds 
for decommissioning from paragraph (f) of this section, including means 
for adjusting cost estimates and associated funding levels periodically 
over the life of the facility. Cost estimates must be adjusted at 
intervals not to exceed three years. The decommissioning funding plan 
must also contain a certification by the licensee that financial 
assurance for decommissioning has been provided in the amount of the 
cost estimate for decommissioning and a signed original of the 
financial instrument obtained to satisfy the requirements of paragraph 
(f) of this section.
* * * * *

    Dated at Rockville, Maryland, this 27th day of September, 2002.

    For the Nuclear Regulatory Commission.
Annette Vietti-Cook,
Secretary of the Commission.
[FR Doc. 02-25243 Filed 10-4-02; 8:45 am]
BILLING CODE 7590-01-P