[Federal Register Volume 70, Number 34 (Tuesday, February 22, 2005)]
[Proposed Rules]
[Pages 8677-8703]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 05-3128]



[[Page 8677]]

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Part III





Nuclear Regulatory Commission





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10 CFR Parts 170 and 171



Revision of Fee Schedules; Fee Recovery for FY 2005; Proposed Rule

Federal Register / Vol. 70 , No. 34 / Tuesday, February 22, 2005 / 
Proposed Rules

[[Page 8678]]


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NUCLEAR REGULATORY COMMISSION

10 CFR Parts 170 and 171

RIN 3150-AH61


Revision of Fee Schedules; Fee Recovery for FY 2005

AGENCY: Nuclear Regulatory Commission.

ACTION: Proposed rule.

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SUMMARY: The Nuclear Regulatory Commission (NRC) is proposing to amend 
the licensing, inspection, and annual fees charged to its applicants 
and licensees. The proposed amendments are necessary to implement the 
Omnibus Budget Reconciliation Act of 1990 (OBRA-90), as amended, which 
requires that the NRC recover approximately 90 percent of its budget 
authority in fiscal year (FY) 2005, less the amounts appropriated from 
the Nuclear Waste Fund (NWF). The total amount to be recovered for FY 
2005 is approximately $540.7 million. After accounting for carryover 
and billing adjustments, the net amount to be recovered through fees is 
approximately $538 million.

DATES: The comment period expires March 24, 2005. Comments received 
after this date will be considered if it is practical to do so, but the 
NRC is able to ensure only that comments received on or before this 
date will be considered. Because OBRA-90 requires that the NRC collect 
the FY 2005 fees by September 30, 2005, requests for extensions of the 
comment period will not be granted.

ADDRESSES: You may submit comments by any one of the following methods. 
Please include number RIN 3150-AH61 in the subject line of your 
comments. Comments on rulemakings submitted in writing or in electronic 
form will be made available to the public in their entirety on the NRC 
rulemaking Web site. Personal information will not be removed from your 
comments.
    Mail comments to: Secretary, U.S. Nuclear Regulatory Commission, 
Washington, DC 20555-0001, Attn: Rulemakings and Adjudications Staff.
    E-mail comments to: [email protected]. If you do not receive a reply e-
mail confirming that we have received your comments, contact us 
directly at (301) 415-1966. You may also submit comments via the NRC's 
rulemaking Web site at http://ruleforum.llnl.gov. Address questions 
about our Web site to Ms. Carol Gallagher, (301) 415-5905; e-mail 
[email protected]. Comments can also be submitted via the Federal eRulemaking 
Portal at http://www.regulations.gov.
    Hand deliver comments to: 11555 Rockville Pike, Rockville, Maryland 
20852, between 7:30 a.m. and 4:15 p.m. Federal workdays. (Telephone 
(301) 415-1966).
    Fax comments to: Secretary, U.S. Nuclear Regulatory Commission at 
(301) 415-1101.
    Publicly available documents related to this rulemaking may be 
viewed electronically on the public computers located at the NRC's 
Public Document Room (PDR), Room O1 F21, One White Flint North, 11555 
Rockville Pike, Rockville, Maryland. The PDR reproduction contractor 
will copy documents for a fee. Selected documents, including comments, 
may be viewed and downloaded electronically via the NRC rulemaking Web 
site at http://ruleforum.llnl.gov.
    Publicly available documents created or received at the NRC after 
November 1, 1999, are available electronically at the NRC's Electronic 
Reading Room at http://www.nrc.gov/reading-rm/adams.html. From this 
site, the public can gain entry into the NRC's Agencywide Documents 
Access and Management System (ADAMS), which provides text and image 
files of NRC's public documents. If you do not have access to ADAMS or 
if there are problems in accessing the documents located in ADAMS, 
contact the NRC PDR Reference staff at 1-800-397-4209; (301) 415-4737 
or by e-mail at [email protected].

FOR FURTHER INFORMATION CONTACT: Tammy Croote, telephone (301) 415-
6041; Office of the Chief Financial Officer, U.S. Nuclear Regulatory 
Commission, Washington, DC 20555-0001.

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

I. Background

    For FYs 1991 through 2000, OBRA-90, as amended, required that the 
NRC recover approximately 100 percent of its budget authority, less the 
amount appropriated from the U.S. Department of Energy (DOE) 
administered NWF, by assessing fees. To address fairness and equity 
concerns raised by the NRC related to charging NRC license holders for 
agency budgeted costs that do not provide a direct benefit to the 
licensee, the FY 2001 Energy and Water Development Appropriations Act 
amended OBRA-90 to decrease the NRC's fee recovery amount by 2 percent 
per year beginning in FY 2001, until the fee recovery amount is 90 
percent in FY 2005. As a result, the NRC is required to recover 
approximately 90 percent of its FY 2005 budget authority, less the 
amounts appropriated from the NWF, through fees. In the Consolidated 
Appropriations Act of 2005 (Pub. L. 108-447), as adjusted by the 
rescission discussed in Section 122(a), Congress appropriated $669.3 
million to the NRC for FY 2005. This sum includes $68.5 million 
appropriated from the NWF. The total amount NRC is required to recover 
in fees for FY 2005 is approximately $540.7 million. After accounting 
for carryover and billing adjustments, the net amount to be recovered 
through fees is approximately $538 million.
    While the total amount that the NRC must recover in fees in FY 2005 
has been determined by Congress and, therefore, is outside the scope of 
this rulemaking, the NRC notes that it has supported previous 
legislative efforts to remove additional costs from the fee base and 
continues to do so. In the 2003 Congressional session, an Energy Policy 
Bill (H.R. 6) was introduced that would have amended OBRA-90 to remove 
many homeland security costs from the fee base (except homeland 
security costs associated with fingerprinting, background checks, and 
security inspections). In its August 29, 2003, letter to the House 
Committee on Energy and Commerce, the Commission supported the fee 
recovery provisions of this bill. The NRC continues to support 
legislative efforts to remove homeland security costs from the fee 
base.
    The NRC assesses two types of fees to meet the requirements of 
OBRA-90, as amended. First, license and inspection fees, established in 
10 CFR part 170 under the authority of the Independent Offices 
Appropriation Act of 1952 (IOAA), 31 U.S.C. 9701, recover the NRC's 
costs of providing special benefits to identifiable applicants and 
licensees. Examples of the services provided by the NRC for which these 
fees are assessed are the review of applications for new licenses and, 
for certain types of existing licenses, the review of renewal 
applications, the review of amendment requests, and inspections. 
Second, annual fees established in 10 CFR part 171 under the authority 
of OBRA-90, recover generic and other regulatory costs not otherwise 
recovered through 10 CFR part 170 fees.

[[Page 8679]]

II. Proposed Action

    The NRC is proposing to amend its licensing, inspection, and annual 
fees to recover approximately 90 percent of its FY 2005 budget 
authority less the appropriations received from the NWF. The NRC's 
total budget authority for FY 2005 is $669.3 million, of which 
approximately $68.5 million has been appropriated from the NWF. Based 
on the 90 percent fee recovery requirement, the NRC must recover 
approximately $540.7 million in FY 2005 through part 170 licensing and 
inspection fees, part 171 annual fees, and other offsetting receipts. 
The total amount to be recovered through fees and other offsetting 
receipts for FY 2005 is $4.6 million less than the amount estimated for 
recovery in FY 2004.
    The FY 2005 fee recovery amount is reduced by a $2.2 million 
carryover from additional collections in FY 2004 that were 
unanticipated at the time the final FY 2004 fee rule was published, and 
by an additional $0.5 million for billing adjustments (i.e., for FY 
2005 invoices that the NRC estimates will not be paid during the fiscal 
year, and for payments received in FY 2005 for FY 2004 invoices). This 
leaves approximately $538 million to be recovered in FY 2005 through 
part 170 licensing and inspection fees, part 171 annual fees, and other 
offsetting receipts.
    The NRC estimates that approximately $166.8 million will be 
recovered in FY 2005 from part 170 fees and other offsetting receipts. 
The NRC derived this estimate based on the previous four quarters of 
billing data for each license class, with adjustments to account for 
changes in the NRC's FY 2005 budget as appropriate. The remaining 
$371.2 million would be recovered through the part 171 annual fees, 
compared to $389.9 million for FY 2004.
    The primary reason for the decrease in total fees for FY 2005 is 
that the NRC's fee recovery is 90 percent in FY 2005, compared to 92 
percent in FY 2004, in accordance with the FY 2001 Energy and Water 
Development Appropriations Act. This decrease in the NRC's required fee 
recovery is sufficient to offset the increase of 1.5 percent in the 
NRC's non-NWF budget in FY 2005.
    Table I summarizes the budget and fee recovery amounts for FY 2005.

          Table 1.--Budget and Fee Recovery Amounts for FY 2005
                          [Dollars in millions]
------------------------------------------------------------------------
 
------------------------------------------------------------------------
Total Budget Authority.......................................     $669.3
  Less NWF...................................................     - 68.5
                                                              ----------
    Balance..................................................     $600.8
  Fee Recovery Rate for FY 2005..............................    x 90.0%
                                                              ----------
Total Amount To Be Recovered for FY 2005.....................     $540.7
  Less Carryover From FY 2004................................      - 2.2
                                                              ----------
  Less Part 171 Billing Adjustments..........................  .........
    Unpaid FY 2005 Invoices (estimated)......................        2.7
    Less Payments Received in FY 2005 for Prior Year Invoices      - 3.2
     (estimated).............................................
                                                              ----------
    Subtotal.................................................       -0.5
                                                              ==========
Amount To Be Recovered Through Parts 170 and 171 Fees........     $538.0
  Less Estimated Part 170 Fees...............................    - 166.8
                                                              ==========
Part 171 Fee Collections Required............................     $371.2
------------------------------------------------------------------------

    The FY 2005 final fee rule will be a ``major rule'' as defined by 
the Small Business Regulatory Enforcement Fairness Act of 1996. 
Therefore, the NRC's fee schedules for FY 2005 would become effective 
60 days after publication of the final rule in the Federal Register. 
The NRC will send an invoice for the amount of the annual fee to 
reactors and major fuel cycle facilities upon publication of the FY 
2005 final rule. For these licensees, payment would be due on the 
effective date of the FY 2005 rule. Those materials licensees whose 
license anniversary date during FY 2005 falls before the effective date 
of the final FY 2005 rule would be billed for the annual fee during the 
anniversary month of the license at the FY 2004 annual fee rate. Those 
materials licensees whose license anniversary date falls on or after 
the effective date of the final FY 2005 rule would be billed for the 
annual fee at the FY 2005 annual fee rate during the anniversary month 
of the license, and payment would be due on the date of the invoice.
    As a matter of courtesy, the NRC plans to continue mailing the 
proposed fee rule to all licensees, although, as a cost saving measure, 
in accordance with its FY 1998 announcement, the NRC has discontinued 
mailing the final fee rule to all licensees. Accordingly, the NRC does 
not plan to routinely mail the FY 2005 final fee rule or future final 
fee rules to licensees.
    However, the NRC will send the final rule to any licensee or other 
person upon specific request. To request a copy, contact the License 
Fee Team, Division of Financial Management, Office of the Chief 
Financial Officer, at (301) 415-7554, or e-mail [email protected]. The NRC 
plans to publish the final fee rule in May 2005. In addition to 
publication in the Federal Register, the final rule will be available 
on the Internet at http://ruleforum.llnl.gov for at least 90 days after 
the effective date of the final rule.
    The NRC is proposing to make changes to 10 CFR parts 170 and 171 as 
discussed in Sections A and B below.

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

    The NRC is proposing to establish the hourly rates used to 
calculate fees and to adjust the part 170 fees based on the proposed 
hourly rates and the results of the agency's biennial review of fees 
required by the Chief Financial Officer (CFO) Act of 1990 (Pub. L. 101-
578, November 15, 1990, 104 Stat. 2838). Additionally, the NRC is 
proposing to revise part 170 to provide for the assessment of full cost 
fees for licensee-

[[Page 8680]]

specific activities resulting from most orders and decommissioning 
activities associated with unlicensed sites; clarify that part 170 fee 
waivers need to be requested from, and granted by, the CFO in writing 
in certain instances; notify licensees that the NRC intends to apply 
its existing full cost recovery policy for project managers to license 
renewal project managers; and make minor administrative changes to 
enhance consistency between the fee categories used in part 170 and 
part 171.
    The NRC is proposing the following changes:
1. Hourly Rates
    The NRC is proposing to establish in Sec.  170.20 two professional 
hourly rates for NRC staff time. These proposed rates would be based on 
the number of FY 2005 direct program full time equivalents (FTEs) and 
the FY 2005 NRC budget, excluding direct program support costs and 
NRC's appropriations from the NWF. These rates are used to determine 
the part 170 fees. The proposed rate for the reactor program is $205 
per hour ($296,898 per direct FTE). This rate would be applicable to 
all activities for which fees are assessed under Sec.  170.21 of the 
fee regulations. The proposed rate for the materials program (nuclear 
materials and nuclear waste programs) is $198 per hour ($285,944 per 
direct FTE). This rate would be applicable to all activities for which 
fees are assessed under Sec.  170.31 of the fee regulations. In the FY 
2004 final fee rule, the reactor and materials program rates were $157 
and $156, respectively. The increase to the reactor and the materials 
program rates is primarily due to the NRC's use of a revised estimate 
of the number of direct hours per FTE in calculating these rates. The 
recent Government-wide pay raise is another reason for the proposed 
increase in the hourly rates.
    As described in further detail below, the NRC currently assumes 
1,776 hours per direct FTE are available for direct program work, while 
the new hourly rate assumes 1,446 hours per direct FTE are available 
for direct program work. Because the NRC's hourly rates are calculated 
by dividing the total annual costs of a direct FTE by average annual 
direct hours per FTE, the lower the number of direct hours per FTE used 
in the calculation, the higher the hourly rates.
    The NRC is proposing to revise its estimate of direct hours per FTE 
to more accurately reflect the NRC's costs of providing part 170 
services, which would allow the NRC to more fully recover the costs of 
these services through part 170 fees. Because costs not recovered under 
part 170 are recovered through part 171 annual fees, the increase in 
total part 170 fees (caused by the hourly rate increase) would result 
in a reduction to total annual fees of the same amount. As such, this 
hourly rate increase would shift some fee recovery from part 171 annual 
fees to part 170 fees for licensee-specific services. (Because revenue 
from these increased part 170 fees would not be received by the NRC 
until FY 2006--in light of the effective date of the final rule and the 
timing of the NRC's regular billing cycle--the reduction in annual fees 
from this change would not occur until FY 2006.)
    Previously, the NRC used an estimate of 1,776 hours per FTE to 
calculate the reactor and materials program hourly rates, based on the 
Office of Management and Budget (OMB) in Circular A-76, ``Performance 
of Commercial Activities.'' However, this Circular provides assumptions 
to be used to estimate personnel costs for the competition of 
commercial activities, and does not provide guidance about assumptions 
to be used for purposes of fee calculation. (OMB's Circular A-25, 
``User Charges,'' also does not specifically address the number of 
hours to assume per FTE in calculating fees, but does emphasize that 
agency fees should reflect the full cost of providing services to 
identifiable beneficiaries.) The 1,776 estimate from Circular A-76 
includes time for administrative, training, and other activities a 
direct program FTE may perform that, while relevant to consider for 
certain costing purposes, would more accurately be considered overhead. 
Therefore, this estimate should not be assumed to be ``direct'' time 
for purposes of calculating a rate per hour of direct activities, which 
is the intended purpose of the NRC's hourly rates. While the 1,776 
estimate would be a useful fee calculation input were more detailed 
information not available, the NRC has been collecting more detailed 
information from its new time and labor system since November 2001, 
which is now the NRC's established source of data for employee work 
activities. The NRC has performed a review of its time and labor data, 
which indicates that 1,446 hours per FTE more accurately reflects the 
time expended by NRC program employees performing activities directly 
associated with the programmatic mission of the NRC.
    The NRC recognizes that the proposed increase to the hourly rates 
is more significant than those hourly rate changes that have occurred 
in previous years. However, the NRC believes that this increase is 
justified in light of the review of the NRC's time and labor data, 
which showed that NRC direct employees spend, on average, 1,446 hours 
per year on activities directly associated with the programmatic 
mission of the NRC. The NRC believes that the use of 1,446 hours per 
FTE is more appropriate for the purpose of the NRC's fee calculation 
than other estimates of hours per FTE used for different agency 
financial purposes. By using an estimate of hours per FTE that reflects 
only direct staff time, the resulting hourly rates more accurately 
reflect the full cost of providing services under part 170. For this 
reason, the NRC believes that this revised estimate of hours per FTE is 
consistent with guidance provided in OMB Circular A-25 on recovering 
the full cost of services provided to identifiable recipients. This 
change also supports industry comments that consistently recommend that 
the NRC collect more of its budget through part 170 fees-for-services 
vs. part 171 annual fees.
    Higher hourly rates would result in (1) increased full cost fees 
for licensing and inspection activities, and (2) increased materials 
flat fees for license applications. As noted, total part 171 annual 
fees would decrease by the same amount as the increase in total part 
170 fees. This shift from part 171 to part 170 would be greater for 
those fee classes with a higher proportion of part 170 to part 171 work 
activities (e.g., operating power reactors, uranium recovery, rare 
earth). Because annual fees are adjusted to recover the remainder of 
the budgeted resources for a license fee class not recovered under part 
170, the total estimated fees (parts 170 plus 171) recovered from a 
license fee class are the same regardless of the amount of the hourly 
rate, however, when implemented, higher hourly rates would result in 
some individual licensees paying less total fees than if this change 
were not enacted. This would be true for those licensees for whom the 
NRC performs fewer hours of part 170 services than it does, on average, 
for a licensee in that class. Similarly, licensees for which the NRC 
performs more hours of part 170 services would pay more in total fees 
under the proposed higher hourly rates.
    The method used to determine the two professional hourly rates is 
as follows:
    a. Direct program FTE levels are identified for the reactor program 
and the materials program (nuclear materials and nuclear waste 
programs). All program costs, except contract support, are included in 
the hourly rate for each program by allocating them uniformly based on 
the total number of direct FTEs

[[Page 8681]]

for the program. Direct contract support, which is the use of contract 
or other services in support of the line organization's direct program, 
is excluded from the calculation of the hourly rates because the costs 
for direct contract support are recovered directly through either part 
170 or 171 fees.
    b. All non-program costs for management and support and the Office 
of the Inspector General, are allocated to each program based on that 
program's costs.
    This method results in the following costs, which are included in 
the hourly rates. Due to rounding, adding the individual numbers in the 
table may result in a total that is slightly different than the one 
shown.

   Table II.--FY 2005 Budget Authority To Be Included In Hourly Rates
                          [Dollars in millions]
------------------------------------------------------------------------
                                                    Reactor    Materials
                                                    program     program
------------------------------------------------------------------------
Direct Program Salaries & Benefits..............     $150.5M      $39.0M
Overhead Salaries & Benefits, Program Travel and       77.5M       17.8M
 Other Support..................................
Allocated Agency Management and Support.........      126.1M       31.4M
                                                 -------------
    Subtotal....................................      354.1M       88.3M
Less Offsetting Receipts........................       -0.1M      -0.00M
                                                 -------------
    Total Budget Included in Hourly Rate........      354.0M       88.3M
Program Direct FTEs.............................     1,192.5       308.7
Rate per Direct FTE.............................     296,898     285,944
Professional Hourly Rate (Rate per direct FTE            205         198
 divided by 1,446 hours)........................
------------------------------------------------------------------------

    As shown in Table II, dividing the $354.0 million budgeted amount 
(rounded) included in the hourly rate for the reactor program by the 
reactor program direct FTEs (1,192.5) results in a rate for the reactor 
program of $296,898 per FTE for FY 2005. The Direct FTE Hourly Rate for 
the reactor program would be $205 per hour (rounded to the nearest 
whole dollar). This rate is calculated by dividing the cost per direct 
FTE ($296,898) by the number of direct billable hours in one year 
(1,446 hours). Similarly, dividing the $88.3 million budgeted amount 
(rounded) included in the hourly rate for the materials program by the 
program direct FTEs (308.7) results in a rate of $285,944 per FTE for 
FY 2005. The Direct FTE Hourly Rate for the materials program would be 
$198 per hour (rounded to the nearest whole dollar). This rate is 
calculated by dividing the cost per direct FTE ($285,944) by the number 
of direct billable hours in one year (1,446 hours).
2. Fee Adjustments
    The NRC is proposing to adjust the current part 170 fees in 
Sec. Sec.  170.21 and 170.31 to reflect both the proposed hourly rates 
and the results of the biennial review of part 170 fees required by the 
CFOs Act. To comply with the requirements of the CFOs Act, the NRC has 
evaluated historical professional staff hours used to process a new 
license application for those materials licensees whose fees are based 
on the average cost method, or ``flat'' fees. This review also included 
new license and amendment applications for import and export licenses.
    Evaluation of the historical data shows that fees based on the 
average number of professional staff hours required to complete 
licensing actions in the materials program should be increased in some 
fee categories and decreased in others to more accurately reflect 
current costs incurred in completing these licensing actions. The data 
for the average number of professional staff hours needed to complete 
new licensing actions was last updated in FY 2003 (68 FR 36714; June 
18, 2003). Thus, the revised average professional staff hours in this 
proposed fee rule reflect the changes in the NRC licensing review 
program that have occurred since FY 2003.
    As a result of the biennial review, the proposed licensing fees 
that are based on the average professional staff hours reflect an 
increase in average time for new license applications for five of the 
33 materials program fee categories, a decrease in average time for 
eight fee categories, and the same average time for the remaining 20 
fee categories. The average time for new license applications and 
amendments for export and import licenses remained the same for each of 
the five fee categories in Sec. Sec.  170.21 and 170.31.
    The proposed licensing fees for fee categories K.1 through K.5 of 
Sec.  170.21, and fee categories 1C, 1D, 2B, 2C, 3A through 3P, 4B 
through 9D, 10B, 15A through 15E, and 16 of Sec.  170.31 are based on 
the revised average professional staff hours needed to process the 
licensing actions multiplied by the proposed materials program 
professional hourly rate for FY 2005. As previously noted, the proposed 
higher hourly rate of $198 for the materials program is a key reason 
for the increases in the proposed licensing fees.
    The biennial review also included the ``flat'' fee for the general 
license registrations covered by fee Category 3.Q. As a result of this 
review, the proposed fee per registration is $630, compared to the 
current fee of $610. The proposed fee is based on the current estimated 
number of registrants, current annual resource estimates for the 
program, and the FY 2005 materials program hourly rate. The next 
biennial review of the registration fee will be included in the FY 2007 
fee rule; however, the registration fee may change in the FY 2006 fee 
rule if there is a change to the materials program hourly rate for FY 
2006.
    The amounts of the materials licensing ``flat'' fees are rounded as 
follows: Fees under $1,000 are rounded to the nearest $10, fees that 
are greater than $1,000 but less than $100,000 are rounded to the 
nearest $100, and fees that are greater than $100,000 are rounded to 
the nearest $1,000. Applications filed on or after the effective date 
of the final rule would be subject to the revised fees in this proposed 
rule.
3. Charging Fees for Licensee-Specific Activities Resulting From Most 
Orders
    The NRC proposes to amend Sec. Sec.  170.21 and 170.31 to provide 
that part 170 fees will be assessed for any licensee-specific activity 
resulting from orders issued by the Commission not related to civil 
penalties or other civil sanctions. Currently, part 170 fees are not 
assessed for amendments or other

[[Page 8682]]

licensee-specific activities resulting from the requirements of 
Commission orders. This is because in cases where the order proposes 
the imposition of a civil penalty or other civil sanctions, the 
assessment of additional costs could be viewed as augmenting the amount 
of the civil penalty and could discourage licensees from contesting 
proposed enforcement actions. However, in recent years, the NRC's use 
of orders to impose additional requirements for safety or security 
reasons has increased. For example, subsequent to the September 11, 
2001, terrorist attacks, the Commission imposed security requirements 
on various groups of licensees through orders. These orders resulted in 
the NRC's review of licensee-specific amendments and other activities 
that normally would have been billable under part 170, except that they 
were associated with orders.
    Given the changing regulatory environment and the extent of 
licensee-specific activities that are resulting from orders unrelated 
to civil penalties or other civil sanctions, the NRC is proposing that 
its regulations be revised to allow for full cost recovery of these 
activities under part 170 from NRC licensees. The NRC is not proposing 
to change cost recovery for the development of these orders; these 
costs would continue to be recovered under part 171.
4. Charging Fees for Unlicensed Sites in Decommissioning
    The NRC currently does not charge part 170 fees to owners or 
operators of unlicensed sites in decommissioning. However, the NRC does 
perform work related to the decommissioning of these sites that is 
recoverable under IOAA through part 170 fees because this work is 
associated with an identifiable beneficiary. These costs are currently 
recovered through either a surcharge that is included in NRC licensees' 
annual fees or through taxpayer-funded appropriations (i.e., Department 
of Treasury's General Fund). Recovering the site-specific 
decommissioning costs associated with these unlicensed sites through 
part 170 fees is consistent with the full cost recovery provisions of 
IOAA and the OMB's guidance in Circular A-25, ``User Charges.'' By 
recovering the costs of decommissioning activities from the owners or 
operators of these unlicensed sites, as NRC does from licensed sites, 
the NRC believes the fairness and equity of its fee schedule would be 
enhanced. Therefore, the NRC is proposing to add a new category (14B) 
to ``Schedule of Materials Fees'' at Sec.  170.31 that would provide 
for the assessment of part 170 fees to recover the full cost of site-
specific decommissioning activities for unlicensed sites. (The current 
Category 14 at Sec.  170.31 would be renumbered as Category 14A.) 
Section 170.2 would also be revised to expand the scope of part 170 to 
cover an owner or operator of an unlicensed site in decommissioning 
being conducted under NRC oversight.
5. Fee Waivers
    Under Sec.  170.11(a)(1)(iii), part 170 fees are not required for a 
report/request that has been submitted to the NRC specifically for the 
purpose of supporting NRC's development of generic guidance and 
regulations. The NRC proposes to clarify this section by stating that 
this fee exemption applies only when it is requested from, and granted 
by, the Chief Financial Officer (CFO) in writing. While this is 
consistent with current practice in requesting and granting these fee 
waivers, the NRC believes this revision would enhance clear 
communication about implementation of this fee waiver provision.
6. Full Cost Recovery of Project Manager Time
    The FY 1999 final fee rule (64 FR 31448; June 10, 1999) expanded 
the scope of part 170 fee assessments to include full cost recovery for 
project managers assigned to a specific plant or facility. Under this 
policy at Sec.  170.12(b)(iv), most project managers' time, excluding 
leave and time spent on generic activities such as rulemaking, is 
recovered through part 170 fees assessed to the specific applicant or 
licensee to which the project manager is assigned. The NRC will begin 
applying this policy to ``license renewal'' project managers as of the 
effective date of this final rule. Although the NRC does not currently 
apply this full cost recovery policy to license renewal project 
managers, this change does not require a modification to its 
regulations. Rather, given the increase in license renewal activities 
since 1999, when full cost recovery for project managers was enacted, 
the NRC recognizes that the existing policy should also apply to 
license renewal project managers. However, because this is a change in 
the application of existing policy, the NRC is notifying licensees of 
this change through this proposed rule and will not implement it until 
the effective date of the final rule.
7. Administrative Amendments
    The NRC is proposing to modify the number or letter identifiers 
associated with fee categories listed in Sec.  170.31, as well as make 
other minor administrative changes, so that the fee categories under 
part 170 are consistent with those used in the `Schedule of Materials 
Annual Fees and Fees for Government Agencies Licensed by NRC' at Sec.  
171.16(d). While the fee categories are, for the most part, consistent 
between the fee tables at Sec. Sec.  170.31 and 171.16(d), in some 
instances they are slightly different. This change would enhance the 
NRC's ability to track parts 170 and 171 fees for license categories 
and simplify communication to licensees about applicable fee 
categories.
    In summary, the NRC is proposing the following changes under 10 CFR 
part 170 --
    1. Establish revised materials and reactor programs hourly rates to 
better reflect the full cost of providing part 170 services;
    2. Revise the licensing fees to be assessed to reflect the reactor 
and materials program hourly rates and to comply with the CFO Act 
requirement that fees be reviewed biennially and revised as necessary 
to reflect the cost to the agency;
    3. Revise Sec. Sec.  170.21 and 170.31 to provide that part 170 
fees will be assessed for any licensee-specific activity resulting from 
orders issued by the Commission not related to civil penalties or other 
civil sanctions;
    4. Revise Sec. Sec.  170.2 and 170.31 to provide that part 170 fees 
will be assessed for any licensee-specific activities associated with 
unlicensed sites in decommissioning being conducted under NRC 
oversight;
    5. Revise Sec.  170.11 to clarify that certain fee waivers need to 
be requested from, and granted by, the CFO in writing;
    6. Apply the existing policy at Sec.  170.12 of full cost recovery 
for project managers to license renewal project managers; and
    7. Make minor administrative changes to Sec.  170.31 to enhance 
consistency in the identification of fee categories between parts 170 
and 171.

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

    The NRC proposes to revise the annual fees for FY 2005 to reflect 
the FY 2005 budget and changes in the number of NRC licensees 
(including those resulting from the transfer of regulatory 
responsibility to Agreement States), eliminate `size of reactor' as a 
reason for granting annual fee exemptions, and make certain 
administrative

[[Page 8683]]

amendments. The proposed amendments are as follow:
1. Annual Fees
    The NRC is proposing to establish rebaselined annual fees for FY 
2005. The Commission's policy commitment, made in the statement of 
considerations accompanying the FY 1995 fee rule (60 FR 32218; June 20, 
1995), and further explained in the statement of considerations 
accompanying the FY 1999 fee rule (64 FR 31448; June 10, 1999), 
determined that base annual fees will be re-established (rebaselined) 
at least every third year, and more frequently if there is a 
substantial change in the total NRC budget or in the magnitude of the 
budget allocated to a specific class of licensees. The fees were last 
rebaselined in FY 2004. Based on the change in the magnitude of the 
budget allocated to certain classes of licensees, the Commission has 
determined that it is appropriate to rebaseline the annual fees again 
this year. Rebaselining fees would result in decreased annual fees 
compared to FY 2004 for five classes of licenses (operating power 
reactors, test and research reactors, spent fuel storage/reactor 
decommissioning, rare earth mills, and transportation), and increased 
annual fees for two classes (fuel facilities and uranium recovery). For 
the materials users class, two categories (sub-classes) of licenses 
would have decreased annual fees while the remainder would have 
increased annual fees. The annual fee for industrial users of nuclear 
material (Category 3P), which is the largest materials users category 
and includes nearly 1,700 of the NRC's approximately 4,500 materials 
licensees, would not change.
    The annual fees in Sec. Sec.  171.15 and 171.16 would be revised 
for FY 2005 to recover approximately 90 percent of the NRC's FY 2005 
budget authority, less the estimated amount to be recovered through 
part 170 fees and the amounts appropriated from the NWF. The total 
amount to be recovered through annual fees for FY 2005 is $371.2 
million, compared to $389.9 million for FY 2004.
    Within the eight fee classes of licensees that pay annual fees, the 
FY 2005 annual fees would increase for many categories of licenses, 
decrease for others, and remain the same in two instances. The 
increases in annual fees range from approximately two percent for a 
master materials license to approximately 267 percent for registrations 
issued for device or product safety evaluations. The proposed decreases 
in annual fees range from approximately six percent for operating power 
reactors to approximately 55 percent for rare earth mills.
    Factors affecting the changes to the annual fee amounts include: 
adjustments in budgeted costs for the different classes of licenses; 
the reduction in the fee recovery rate from 92 percent for FY 2004 to 
90 percent for FY 2005; the estimated part 170 collections for the 
various classes of licenses; the decrease in the number of licensees 
for certain categories of licenses; and the $2.2 million carryover from 
additional collections in FY 2004 that were unanticipated at the time 
the FY 2004 final rule was published (i.e., this FY 2004 carryover was 
used to reduce the FY 2005 fees).
    Table III below shows the proposed rebaselined annual fees for FY 
2005 for a representative list of categories of licenses. The FY 2004 
fee is also shown for comparative purposes.

             Table III.--Rebaselined Annual Fees for FY 2005
------------------------------------------------------------------------
                                                 FY 2004       FY 2005
         Class/category of licenses            annual fee    annual fee
------------------------------------------------------------------------
Operating Power Reactors (including Spent       $3,283,000    $3,067,000
 Fuel Storage/Reactor Decommissioning annual
 fee).......................................
Spent Fuel Storage/Reactor Decommissioning..       203,000       164,000
Test and Research Reactors (Nonpower                62,500        54,400
 Reactors)..................................
High Enriched Uranium Fuel Facility.........     4,573,000     5,383,000
Low Enriched Uranium Fuel Facility..........     1,533,000     1,612,000
UF6 Conversion Facility.....................       657,000       691,000
Conventional Mills..........................        14,500        27,700
Transportation:
  Users/Fabricators.........................        91,300        80,200
  Users Only................................         7,400         4,300
Typical Materials Users:
  Radiographers.............................        11,900        12,800
  Well Loggers..............................         4,600         4,100
  Gauge Users (Category 3P).................         2,500         2,500
  Broad Scope Medical.......................        25,000        27,300
------------------------------------------------------------------------

    The annual fees assessed to each class of licenses include a 
surcharge to recover those NRC budgeted costs that are not directly or 
solely attributable to the classes of licenses, but must be recovered 
from licensees to comply with the requirements of OBRA-90, as amended. 
Based on the FY 2001 Energy and Water Development Appropriations Act, 
which amended OBRA-90 to decrease the NRC's fee recovery amount by 2 
percent per year beginning in FY 2001 until the fee recovery amount is 
90 percent in FY 2005, the total surcharge costs for FY 2005 will be 
reduced by approximately $60.1 million. The total FY 2005 budgeted 
costs for these activities and the reduction to the total surcharge 
amount for fee recovery purposes are shown in Table IV.

                       Table IV.--Surcharge Costs
                          [Dollars in millions]
------------------------------------------------------------------------
                                                                FY 2005
                      Category of costs                        budgeted
                                                                 costs
------------------------------------------------------------------------
1. Activities not attributable to an existing NRC licensee
 or class of licensee:
    a. International activities.............................       $10.0

[[Page 8684]]

 
    b. Agreement State oversight............................         8.1
    c. Activities for unlicensed sites (includes                     3.5
     decommissioning costs associated with unlicensed sites,
     formerly referred to as site decommissioning management
     plan activities not recovered under part 170; also
     includes activities associated with unregistered
     general licensees).....................................
2. Activities not assessed part 170 licensing and inspection
 fees or part 171 annual fees based on existing law or
 Commission policy:
    a. Fee exemption for nonprofit educational institutions.         8.8
    b. Licensing and inspection activities associated with           1.4
     other Federal agencies.................................
    c. Costs not recovered from small entities under 10 CFR          5.9
     171.16(c)..............................................
3. Activities supporting NRC operating licensees and others:
    a. Regulatory support to Agreement States\1\............        13.9
    b. Generic decommissioning/reclamation (except those            10.0
     related to power reactors).............................
        Total surcharge costs...............................        61.6
Less 10 percent of NRC's FY 2005 total budget (less NWF)....       -60.1
                                                             -----------
        Total surcharge costs to be recovered...............        1.5
------------------------------------------------------------------------
\1\ This estimate includes the costs of homeland security activities
  associated with sources in Agreement States, even though regulatory
  authority remains with the NRC for these activities. However, fees are
  not assessed to sources in Agreement States for these activities,
  therefore these costs are included in this surcharge category.

    As shown in Table IV, $1.5 million would be the total surcharge 
cost allocated to the various classes of licenses for FY 2005 (i.e., 
that portion of the total surcharge not covered by the NRC's 10 percent 
fee relief). The NRC would continue to allocate these surcharge costs 
to each class of licenses based on the percent of the budget for that 
fee class compared to the NRC's total budget. The proposed surcharge 
costs allocated to each class would be included in the annual fee 
assessed to each licensee. The proposed FY 2005 surcharge costs 
allocated to each class of licenses are shown in Table V. Separately, 
the NRC would continue to allocate the low-level waste (LLW) surcharge 
costs based on the volume of LLW disposal of certain classes of 
licenses. For FY 2005, the LLW surcharge costs are $2.8 million.

                                        Table V.--Allocation of Surcharge
----------------------------------------------------------------------------------------------------------------
                                                          LLW surcharge         Non-LLW surcharge       Total
                                                    ------------------------------------------------  surcharge
                                                                                                    ------------
                                                       Percent       $M        Percent       $M           $M
----------------------------------------------------------------------------------------------------------------
Operating Power Reactors...........................          74         2.1        82.4         1.2          3.3
Spent Fuel Storage/Reactor Decomm..................  ..........  ..........         4.7         0.1          0.1
Nonpower Reactors..................................  ..........  ..........         0.1           0            0
Fuel Facilities....................................           8         0.2         7.2         0.1          0.3
Materials Users....................................          18         0.5         4.0         0.1          0.6
Transportation.....................................  ..........  ..........         1.0           0            0
Rare Earth Facilities..............................  ..........  ..........         0.2           0            0
Uranium Recovery...................................  ..........  ..........         0.4           0            0
                                                    -------------
    Total Surcharge................................         100         2.8       100.0         1.5          4.3
----------------------------------------------------------------------------------------------------------------

    The budgeted costs allocated to each class of licenses and the 
calculations of the rebaselined fees are described in a. through h. 
below. The workpapers which support this proposed rule show in detail 
the allocation of NRC's budgeted resources for each class of licenses 
and how the fees are calculated. The workpapers are available 
electronically at the NRC's Electronic Reading Room on the Internet at 
Web site address http://www.nrc.gov/reading-rm/adams.html. During the 
30-day public comment period, the workpapers may also be examined at 
the NRC Public Document Room located at One White Flint North, Room O-
1F22, 11555 Rockville Pike, Rockville, MD 20852-2738.
    a. Fuel Facilities. The FY 2005 budgeted cost to be recovered in 
annual fees assessment to the fuel facility class of licenses is 
approximately $23.8 million compared to $21.6 million in FY 2004. The 
annual fee increase is partly attributable to the decrease in estimated 
part 170 revenue for the fuel facility class compared to FY 2004. This 
FY 2005 decrease results partly from part 170 fuel facilities' revenue 
in FY 2004 including a one-time $2.1 million adjustment (increase) for 
revenue to account for fuel facilities fees that were improperly coded 
(i.e., costs associated with the Duke Cogema Stone and Webster 
application) and not factored into the fee calculations for FY 2001, FY 
2002, and FY 2003, as discussed in the FY 2004 final fee rule. The 
annual fee increase is also due to an increase in budgeted resources 
for this class of licensees. The annual fees are allocated to the 
individual fuel facility licensees based on the effort/fee 
determination matrix established in the FY 1999 final fee rule (64 FR 
31448; June 10, 1999). In the matrix (which is included in the NRC 
workpapers that are publicly

[[Page 8685]]

available), licensees are grouped into categories according to their 
licensed activities (i.e., nuclear material enrichment, processing 
operations, and material form) and according to the level, scope, depth 
of coverage, and rigor of generic regulatory programmatic effort 
applicable to each category from a safety and safeguards perspective. 
This methodology can be applied to determine fees for new licensees, 
current licensees, licensees in unique license situations, and 
certificate holders.
    This methodology is adaptable to changes in the number of licensees 
or certificate holders, licensed or certified material and/or 
activities, and total programmatic resources to be recovered through 
annual fees. When a license or certificate is modified, it may result 
in a change of category for a particular fuel facility licensee as a 
result of the methodology used in the fuel facility effort/fee matrix. 
Consequently, this change may also have an effect on the fees assessed 
to other fuel facility licensees and certificate holders. For example, 
if a fuel facility licensee amends its license/certificate in such a 
way (e.g., decommissioning or license termination) that results in it 
not being subject to part 171 costs applicable to the fee class, then 
the budgeted costs for the safety and/or safeguards components will be 
spread among the remaining fuel facility licensees/certificate holders.
    The methodology is applied as follows. First, a fee category is 
assigned based on the nuclear material and activity authorized by 
license or certificate. Although a licensee/certificate holder may 
elect not to fully use a license/certificate, the license/certificate 
is still used as the source for determining authorized nuclear material 
possession and use/activity. Next, the category and license/certificate 
information are used to determine where the licensee/certificate holder 
fits into the matrix. The matrix depicts the categorization of 
licensees/certificate holders by authorized material types and use/
activities, and the relative generic regulatory programmatic effort 
associated with each category. The programmatic effort (expressed as a 
value in the matrix) reflects the safety and safeguards risk 
significance associated with the nuclear material and use/activity, and 
the commensurate generic regulatory program (i.e., scope, depth and 
rigor) level of effort.
    The effort factors for the various subclasses of fuel facility 
licenses, including the proposed new subclass, are summarized in Table 
VI.

              Table VI.--Effort Factors for Fuel Facilities
------------------------------------------------------------------------
                                                   Effort factors  (in
                                    Number of           percent)
          Facility type             facilities -------------------------
                                                   Safety     Safeguards
------------------------------------------------------------------------
High Enriched Uranium Fuel.......            2   101 (38.0)    86 (58.1)
Enrichment.......................            2    70 (26.3)    34 (23.0)
Low Enriched Uranium Fuel........            3    66 (24.8)    18 (12.2)
UF6 Conversion...................            1     12 (4.5)        0 (0)
Limited Operations Facility......            1      8 (3.0)      3 (2.0)
Others...........................            2      9 (3.4)      7 (4.7)
------------------------------------------------------------------------

    Applying these factors to the safety, safeguards, and surcharge 
components of the $23.8 million total annual fee amount for the fuel 
facility class results in annual fees for each licensee within the 
categories of this class summarized in Table VII.

               Table VII.--Annual Fees for Fuel Facilities
------------------------------------------------------------------------
                                                               FY 2005
                       Facility type                         annual fee
------------------------------------------------------------------------
High Enriched Uranium Fuel................................    $5,383,000
Uranium Enrichment........................................     2,994,000
Low Enriched Uranium......................................     1,612,000
UF6 Conversion............................................       691,000
Limited Operations Facility...............................       633,000
Others....................................................       461,000
------------------------------------------------------------------------

    b. Uranium Recovery Facilities. The proposed FY 2005 budgeted cost, 
including surcharge costs, to be recovered through annual fees assessed 
to the uranium recovery class is approximately $677,611. Approximately 
$539,000 of this amount would be assessed to DOE. The remaining 
$139,000 would be recovered through annual fees assessed to 
conventional mills, in-situ leach solution mining facilities, and 
11e.(2) mill tailings disposal facilities. The annual fees for these 
facilities would increase in FY 2005 due to a slight increase in 
budgeted resources for this license fee class, and because the NRC 
estimates that a smaller proportion of these resources will be 
recovered under part 170.
    Consistent with the change in methodology adopted in the FY 2002 
final fee rule (67 FR 42612; June 24, 2002), the total annual fee 
amount, less the amounts specifically budgeted for Title I activities, 
is allocated equally between Title I and Title II licensees. This would 
result in an annual fee being assessed to DOE to recover the costs 
specifically budgeted for NRC's Title I activities plus 50 percent of 
the remaining annual fee amount, including the surcharge and generic/
other costs, for the uranium recovery class. The remaining 50 percent 
of the surcharge and generic/other costs are assessed to the NRC Title 
II program licensees that are subject to annual fees. The costs to be 
recovered through annual fees assessed to the uranium recovery class 
are shown below.

[[Page 8686]]



------------------------------------------------------------------------
 
------------------------------------------------------------------------
DOE Annual Fee Amount (UMTRCA Title I and Title II general
 licenses):
    UMTRCA Title I budgeted costs..........................     $400,322
    50 percent of generic/other uranium recovery budgeted        135,619
     costs.................................................
    50 percent of uranium recovery surcharge...............        3,026
                                                            ------------
        Total Annual Fee Amount for DOE....................      538,966
                                                            ============
Annual Fee Amount for UMTRCA Title II Specific Licenses:
    50 percent of generic/other uranium recovery budgeted        135,619
     costs.................................................
    50 percent of uranium recovery surcharge...............        3,026
                                                            ------------
        Total Annual Fee Amount for Title II Specific            138,644
         Licenses..........................................
------------------------------------------------------------------------

    The matrix used to allocate the costs of various categories of 
Title II specific licensees has been updated to equally weight the 
effort levels for each category of uranium recovery facilities, in 
accordance with the NRC's FY 2005 budgeted activities. It has also been 
revised to reflect two fewer uranium recovery facilities, in light of 
the fact that regulatory responsibility for these two facilities has 
been transferred to Utah (see discussion under ``Agreement State 
Activities'' below). However, consistent with the methodology 
established in the FY 1995 fee rule (60 FR 32218; June 20, 1995), the 
approach for establishing part 171 annual fees for Title II uranium 
recovery licensees has not changed, and is as follows:
    (1) The methodology identifies three categories of licenses: 
conventional uranium mills (Class I facilities), uranium solution 
mining facilities (Class II facilities), and mill tailings disposal 
facilities (11e.(2) disposal facilities). Each of these categories 
benefits from the generic uranium recovery program efforts (e.g., 
rulemakings, staff guidance documents);
    (2) The matrix relates the category and the level of benefit by 
program element and subelement;
    (3) The two major program elements of the generic uranium recovery 
program are activities related to facility operations and those related 
to facility closure;
    (4) Each of the major program elements was further divided into 
three subelements; and
    (5) The three major subelements of generic activities associated 
with uranium facility operations are regulatory efforts related to the 
operation of mills, handling and disposal of waste, and prevention of 
groundwater contamination. The three major subelements of generic 
activities associated with uranium facility closure are regulatory 
efforts related to decommissioning of facilities and land clean-up, 
reclamation and closure of tailings impoundments, and groundwater 
clean-up. Weighted values were assigned to each program element and 
subelement considering health and safety implications and the 
associated effort to regulate these activities. The applicability of 
the generic program in each subelement to each uranium recovery 
category was qualitatively estimated as either significant, some, 
minor, or none.
    The relative weighted factors per facility type for the various 
categories of specifically licensed Title II uranium recovery licensees 
are as follows:

                           Table VIII.--Weighted Factors for Uranium Recovery Licenses
----------------------------------------------------------------------------------------------------------------
                                                                                              Level of benefit
                                                                  Number of     Category        total weight
                         Facility type                           facilities      weight    ---------------------
                                                                                              Value     Percent
----------------------------------------------------------------------------------------------------------------
Class I (conventional mills)..................................             1           800        800         20
Class II (solution mining)....................................             3           800      2,400         60
11e.(2) disposal..............................................             0             0          0          0
11e.(2) disposal incidental to existing tailings sites........             1           800        800         20
----------------------------------------------------------------------------------------------------------------

    Applying these factors to the approximately $139,000 in budgeted 
costs to be recovered from Title II specific licensees results in the 
following revised annual fees:

          Table IX.--Annual Fees for Title II Specific Licenses
------------------------------------------------------------------------
                                                               FY 2005
                       Facility type                          annual fee
------------------------------------------------------------------------
Class I (conventional mills)...............................      $27,700
Class II (solution mining).................................       27,700
11e.(2) disposal...........................................          N/A
11e.(2) disposal incidental to existing tailings sites.....       27,700
------------------------------------------------------------------------

    Note because there are no longer any 11e.(2) disposal facilities 
under the NRC's regulatory jurisdiction, the NRC has not allocated any 
budgeted resources for these facilities, and therefore has not 
established an annual fee for this fee category. If NRC issues a 
license for this fee category in the future, then the Commission will 
establish the appropriate annual fee.
    In the FY 2001 final rule (66 FR 32478; June 14, 2001), the NRC 
revised Sec.  171.19 to establish a quarterly billing schedule for 
Class I and Class II licensees, regardless of the annual fee

[[Page 8687]]

amount. Therefore, as provided in Sec.  171.19(b), if the amounts 
collected in the first three quarters of FY 2005 exceed the amount of 
the revised annual fee, the overpayment will be refunded; if the 
amounts collected in the first three quarters are less than the final 
revised annual fee, the remainder will be billed after the FY 2005 
final fee rule is published. The remaining categories of Title II 
facilities are subject to billing based on the anniversary date of the 
license as provided in Sec.  171.19(c).
    c. Operating Power Reactors. The approximately $301.9 million in 
budgeted costs to be recovered through FY 2005 annual fees assessed to 
the power reactor class, including budgeted costs for homeland security 
activities related to power reactors, is divided equally among the 104 
power reactors licensed to operate. This results in a FY 2005 annual 
fee of $2,903,000 per reactor. Additionally, each power reactor 
licensed to operate will be assessed the FY 2005 spent fuel storage/
reactor decommissioning annual fee of $164,000. This results in a total 
FY 2005 annual fee of $3,067,000 for each power reactor licensed to 
operate. While budgeted resources for power reactors increased in FY 
2005, annual fees would decrease because the NRC estimates that it will 
collect more of these resources through part 170 fees to power 
reactors.
    d. Spent Fuel Storage/Reactor Decommissioning. For FY 2005, 
budgeted costs of approximately $20 million for spent fuel storage/
reactor decommissioning are to be recovered through annual fees 
assessed to part 50 power reactors, and to part 72 licensees who do not 
hold a part 50 license. Those reactor licensees that have ceased 
operations and have no fuel onsite are not subject to these annual 
fees. The costs are divided equally among the 122 licensees (with the 
exception of a new license issued on November 30, 2004, which will pay 
an 83 percent prorated annual fee), resulting in a FY 2005 annual fee 
of $164,000 per licensee. Annual fees would decrease for these 
licensees due to a reduction in budgeted resources for this license fee 
class.
    e. Test and Research Reactors (Nonpower Reactors). Approximately 
$218,000 in budgeted costs is to be recovered through annual fees 
assessed to the test and research reactor class of licenses for FY 
2005. This amount is divided equally among the four test and research 
reactors subject to annual fees. This results in a FY 2005 annual fee 
of $54,400 for each licensee. While budgeted resources for test and 
research reactors increase in FY 2005, annual fees would decrease due 
to a projected increase in the proportion of these resources recovered 
through part 170 fees to test and research reactors.
    f. Rare Earth Facilities. The FY 2005 budgeted costs of $71,000 for 
rare earth facilities to be recovered through annual fees will be 
assessed to the one licensee who has a specific license for receipt and 
processing of source material, resulting in a FY 2005 annual fee of 
$71,000. While total budgeted resources for the rare earth fee class 
increase in FY 2005, this increase is due to licensee-specific 
activities, the costs of which would be recovered under part 170. The 
annual fee for the operating rare earth facility would decrease due to 
a slight decrease in generic activities performed for this fee class.
    g. Materials Users. To equitably and fairly allocate the $26.1 
million in FY 2005 budgeted costs to be recovered in annual fees 
assessed to the approximately 4,500 diverse materials users and 
registrants, the NRC has continued to base the annual fees for each fee 
category within this class on the part 170 application fees and 
estimated inspection costs for each fee category. Because the 
application fees and inspection costs are indicative of the complexity 
of the license, this approach continues to provide a proxy for 
allocating the generic and other regulatory costs to the diverse 
categories of licenses based on how much it costs the NRC to regulate 
each category. Changes in FY 2005 annual fees for categories of 
licensees within the materials class reflect not only changes in 
budgeted resources for the materials class of licensees, but also 
changes in estimates of average professional staff time for materials 
users license applications and inspections, derived from the biennial 
review performed for the FY 2005 fee rule. (Large percentage increases 
in certain materials users fee categories, e.g., 3H, 3I, 9A, and 9B, 
are the result of significant changes to these average professional 
staff time estimates.) The fee calculation also continues to consider 
the inspection frequency (priority), which is indicative of the safety 
risk and resulting regulatory costs associated with the categories of 
licenses. The annual fee for these categories of licenses is developed 
as follows:
Annual fee = Constant x [Application Fee + (Average Inspection Cost 
divided by Inspection Priority)] + Inspection Multiplier x (Average 
Inspection Cost divided by Inspection Priority) + Unique Category 
Costs.

    The constant is the multiple necessary to recover approximately 
$20.9 million in general costs and is 1.27 for FY 2005. The inspection 
multiplier is the multiple necessary to recover approximately $4.5 
million in inspection costs for FY 2005, and is 1.08 for FY 2005. The 
unique category costs are any special costs that the NRC has budgeted 
for a specific category of licenses. For FY 2005, approximately $36,000 
in budgeted costs for the implementation of revised part 35, Medical 
Use of Byproduct Material (unique costs), has been allocated to holders 
of NRC human use licenses.
    The annual fee assessed to each licensee also includes a share of 
the $60,000 in surcharge costs allocated to the materials user class of 
licenses and, for certain categories of these licenses, a share of the 
approximately $504,000 in LLW surcharge costs allocated to the class. 
The annual fee for each fee category is shown in Sec.  171.16(d). 
Because the budgeted resources for this class of licensees increase in 
FY 2005, annual fees would increase for most of the fee categories in 
this class.
    h. Transportation. Of the approximately $4.3 million in FY 2005 
budgeted costs to be recovered through annual fees assessed to the 
transportation class of licenses, approximately $1.1 million will be 
recovered from annual fees assessed to DOE based on the number of part 
71 Certificates of Compliance that it holds. Of the remaining $3.2 
million, approximately 16 percent is allocated to the 84 quality 
assurance plans authorizing use only and the 35 quality assurance plans 
authorizing use and design/fabrication. The remaining 84 percent is 
allocated only to the 35 quality assurance plans authorizing use and 
design/fabrication. This results in an annual fee of $4,300 for each of 
the holders of quality assurance plans that authorize use only, and an 
annual fee of $80,200 for each of the holders of quality assurance 
plans that authorize use and design/fabrication. Fees would decrease 
for transportation licensees in FY 2005 due to a reduction in budgeted 
resources allocated to this fee class compared to FY 2004.
2. Small Entity Annual Fees
    The NRC stated in the FY 2001 fee rule (66 FR 32452; June 14, 
2001), that it would re-examine the small entity fees every two years, 
in the same years in which it conducts the biennial review of fees as 
required by the CFOs Act. Accordingly, the NRC has re-examined the 
small entity fees, and does not believe that a change to the small 
entity fees is warranted for FY 2005. The revision to the small entity 
fees in FY 2000 (65 FR 36946; June 12, 2000) was

[[Page 8688]]

based on the 25 percent increase in average total fees assessed to 
other materials licensees in selected categories (those categories that 
include a number of small entities) since the small entity fees were 
first established, and changes that had occurred in the fee structure 
for materials licensees over time. While proposed fees for many of 
these selected categories of materials licensees would increase in FY 
2005 compared to FY 2004, these fees are still lower, on average, than 
those charged in FY 2000, when small entity fees were last revised.
    Unlike the annual fees assessed to other licensees, the small 
entity fees are not designed to recover the agency costs associated 
with particular licensees. Instead, the reduced fees for small entities 
are designed to provide some fee relief for qualifying small entity 
licensees while at the same time recovering from them some of the 
agency's costs for activities that benefit them. The costs not 
recovered from small entities for activities that benefit them must be 
recovered from other licensees. Given the reduction in annual fees from 
FY 2000 to FY 2005, on average, for those categories of materials 
licensees that contain a number of small entities, the NRC has 
determined that the current small entity fees of $500 and $2,300 
continue to meet the objective of providing relief to many small 
entities while recovering from them some of the costs that benefit 
them.
    Therefore, the NRC is proposing to retain the $2,300 small entity 
annual fee and the $500 lower tier small entity annual fee for FY 2005. 
The NRC plans to re-examine the small entity fees again in FY 2007.
3. Agreement State Activities
    On August 10, 2004, the NRC approved an Agreement with the State of 
Utah under Section 274 of the Atomic Energy Act (AEA) of 1954, as 
amended. This Agreement transferred to the State the Commission's 
regulatory responsibility for uranium mills and mill tailings sites. 
This Agreement became effective August 16, 2004. Utah previously had 
become an Agreement State for certain other categories of materials, 
effective April 1, 1984. This Agreement was amended to include 
commercial low-level waste disposal responsibilities, effective May 9, 
1990.
    As a result of this Agreement, four former NRC uranium recovery 
licensees are now Utah licensees, two of which are uranium mills that 
are in decommissioning and reclamation. Because NRC does not charge 
fees to Agreement States or their licensees, the NRC will not collect 
fees in FY 2005 or thereafter for these four former NRC licensees. (The 
NRC did not collect annual fees for the mills in decommissioning while 
under the NRC's regulatory authority, because licensees in 
decommissioning are exempt from annual fees.) The costs of Agreement 
State regulatory support and oversight activities for Utah, as for any 
other Agreement State, would be recovered through the surcharge, 
consistent with existing fee policy.
4. Fee Waivers
    The NRC is proposing to modify Sec.  171.11(c) to eliminate `size 
of the reactor' as a consideration in evaluating annual fee exemption 
requests. In the Statement of Consideration in the 1986 final fee rule 
(51 FR 33227; September 18, 1986), the Commission decided against 
determining its fees based on the size of the reactor because it found 
no necessary relationship between the thermal megawatt rating of a 
reactor and the agency's regulatory costs. Because it was not the 
Commission's intent to issue a fee schedule that would have the effect 
of forcing smaller, older reactors to shut down, it added an annual fee 
exemption provision which takes reactor size, age, and other relevant 
factors into consideration.
    However, none of these smaller reactors is still licensed to 
operate. For several years the NRC has issued no waivers on the basis 
of size. Moreover, the NRC streamlined its fee program in the FY 1995 
final fee rule (60 FR 32218; June 20, 1995) by establishing a uniform 
annual fee for power reactors, based on an analysis that showed that 
the difference in fees resulting from a breakdown of reactors into 
different fee categories was small relative to the amount of the annual 
fee per reactor. Therefore, the NRC believes that the current reference 
to `size of the reactor' in Sec.  171.11(c), as a consideration in 
evaluating annual fee exemption requests, is no longer needed. No other 
class of licensee contains an exemption provision based on size.
5. Administrative Amendments
    The NRC is proposing to eliminate reference to specific facility 
names under Category 1.A of the ``Schedule of Materials Annual Fees and 
Fees for Government Agencies Licensed by the NRC'' in Sec.  171.16. 
This administrative change would be made to streamline the fee schedule 
in light of the fact that the listing of individual facilities within a 
fee category is not necessary to identify license fee amounts. Given 
this change, a licensee within Category 1.A would determine its annual 
fee amount by the fee subcategory assigned to its license, as is the 
practice for other licensees.
    Additionally, the NRC is proposing to modify Sec. Sec.  
171.15(d)(1)(ii) and 171.16(e)(2) to clarify that activities comprising 
the annual fee surcharge include activities associated with unlicensed 
sites and unregistered general licensees. Currently, these paragraphs 
state that complex materials site decommissioning activities not 
covered under part 170 are included in the surcharge. Because this 
surcharge category also includes part 171, or generic costs associated 
with these decommissioning sites, the NRC is proposing to eliminate the 
phrase, ``not covered under part 170.'' (Note that if the regulatory 
revision to charge unlicensed sites in decommissioning, as previously 
discussed, is implemented, this surcharge category would not include 
part 170 activities associated with these sites.) In addition, 
activities associated with unregistered general licensees are included 
in this surcharge category.
    Finally, the NRC is proposing to include, for each fee subcategory 
listed in the ``Schedule of Materials Annual Fees and Fees for 
Government Agencies Licensed by NRC'' at Sec.  171.16(d), a unique 
number or letter identifier, and to make other minor administrative 
changes to enhance the consistency of fee categorizations between parts 
170 and 171. This change would enhance the NRC's ability to track part 
170 and part 171 fees for license categories and simplify communication 
to licensees about applicable fee categories.
    In summary, the NRC is proposing to--
    1. Establish rebaselined annual fees for FY 2005;
    2. Retain the current reduced fees for small entities;
    3. Adjust the annual fees to reflect changes in Agreement State 
activities;
    4. Modify Sec.  171.11 to eliminate ``size of reactor'' as a 
consideration in evaluating annual fee exemption requests; and
    5. Eliminate reference to specific facility names under Category 
1.A of Sec.  171.16, revise Sec. Sec.  171.15 and 171.16 to clarify the 
activities that comprise the annual fee surcharge, and make other minor 
administrative changes to enhance the consistency of fee 
categorizations between parts 170 and 171.

III. 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. This memorandum was

[[Page 8689]]

published on June 10, 1998 (63 FR 31883). 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.

IV. Voluntary Consensus Standards

    The National Technology Transfer and Advancement Act of 1995, Pub. 
L. 104-113, requires that Federal agencies use technical standards that 
are developed or adopted by voluntary consensus standards bodies unless 
using these standards is inconsistent with applicable law or is 
otherwise impractical. In this proposed rule, the NRC would amend the 
licensing, inspection, and annual fees charged to its licensees and 
applicants as necessary to recover approximately 90 percent of its 
budget authority in FY 2005 as required by the Omnibus Budget 
Reconciliation Act of 1990, as amended. This action does not constitute 
the establishment of a standard that contains generally applicable 
requirements.

V. Environmental Impact: Categorical Exclusion

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

VI. Paperwork Reduction Act Statement

    This proposed rule does not contain information collection 
requirements and, therefore, is not subject to the requirements of the 
Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.).

VII. Regulatory Analysis

    With respect to 10 CFR Part 170, this proposed rule was developed 
under Title V of the Independent Offices Appropriation Act of 1952 
(IOAA) (31 U.S.C. 9701) and the Commission's fee guidelines. When 
developing these guidelines the Commission took into account guidance 
provided by the U.S. Supreme Court on March 4, 1974, in National Cable 
Television Association, Inc. v. United States, 415 U.S. 36 (1974) and 
Federal Power Commission v. New England Power Company, 415 U.S. 345 
(1974). In these decisions, the Court held that the IOAA authorizes an 
agency to charge fees for special benefits rendered to identifiable 
persons measured by the ``value to the recipient'' of the agency 
service. The meaning of the IOAA was further clarified on December 16, 
1976, by four decisions of the U.S. Court of Appeals for the District 
of Columbia: National Cable Television Association v. Federal 
Communications Commission, 554 F.2d 1094 (D.C. Cir. 1976); National 
Association of Broadcasters v. Federal Communications Commission, 554 
F.2d 1118 (D.C. Cir. 1976); Electronic Industries Association v. 
Federal Communications Commission, 554 F.2d 1109 (D.C. Cir. 1976); and 
Capital Cities Communication, Inc. v. Federal Communications 
Commission, 554 F.2d 1135 (D.C. Cir. 1976). The Commission's fee 
guidelines were developed based on these legal decisions.
    The Commission's fee guidelines were upheld on August 24, 1979, by 
the U.S. Court of Appeals for the Fifth Circuit in Mississippi Power 
and Light Co. v. U.S. Nuclear Regulatory Commission, 601 F.2d 223 (5th 
Cir. 1979), cert. denied, 444 U.S. 1102 (1980). This court held that--
    (1) The NRC had the authority to recover the full cost of providing 
services to identifiable beneficiaries;
    (2) The NRC could properly assess a fee for the costs of providing 
routine inspections necessary to ensure a licensee's compliance with 
the Atomic Energy Act and with applicable regulations;
    (3) The NRC could charge for costs incurred in conducting 
environmental reviews required by NEPA;
    (4) The NRC properly included the costs of uncontested hearings and 
of administrative and technical support services in the fee schedule;
    (5) The NRC could assess a fee for renewing a license to operate a 
low-level radioactive waste burial site; and
    (6) The NRC's fees were not arbitrary or capricious.
    With respect to 10 CFR Part 171, on November 5, 1990, the Congress 
passed Pub. L. 101-508, the Omnibus Budget Reconciliation Act of 1990 
(OBRA-90), which required that, for FYs 1991 through 1995, 
approximately 100 percent of the NRC budget authority be recovered 
through the assessment of fees. OBRA-90 was subsequently amended to 
extend the 100 percent fee recovery requirement through FY 2000. The FY 
2001 Energy and Water Development Appropriations Act amended OBRA-90 to 
decrease the NRC's fee recovery amount by 2 percent per year beginning 
in FY 2001, until the fee recovery amount is 90 percent in FY 2005. The 
NRC's fee recovery amount for FY 2005 is 90 percent. To comply with 
this statutory requirement and in accordance with Sec.  171.13, the NRC 
is publishing the amount of the FY 2005 annual fees for reactor 
licensees, fuel cycle licensees, materials licensees, and holders of 
Certificates of Compliance, registrations of sealed source and devices 
and QA program approvals, and Government agencies. OBRA-90, consistent 
with the accompanying Conference Committee Report, and the amendments 
to OBRA-90, provides that--
    (1) The annual fees be based on approximately 90 percent of the 
Commission's FY 2005 budget of $669.3 million less the amounts 
collected from part 170 fees and funds directly appropriated from the 
NWF to cover the NRC's high-level waste program;
    (2) The annual fees shall, to the maximum extent practicable, have 
a reasonable relationship to the cost of regulatory services provided 
by the Commission; and
    (3) The annual fees be assessed to those licensees the Commission, 
in its discretion, determines can fairly, equitably, and practicably 
contribute to their payment.
    10 CFR Part 171, which established annual fees for operating power 
reactors effective October 20, 1986 (51 FR 33224; September 18, 1986), 
was challenged and upheld in its entirety in Florida Power and Light 
Company v. United States, 846 F.2d 765 (D.C. Cir. 1988), cert. denied, 
490 U.S. 1045 (1989). Further, the NRC's FY 1991 annual fee rule 
methodology was upheld by the D.C. Circuit Court of Appeals in Allied 
Signal v. NRC, 988 F.2d 146 (D.C. Cir. 1993).

VIII. Regulatory Flexibility Analysis

    The NRC is required by the Omnibus Budget Reconciliation Act of 
1990, as amended, to recover approximately 90 percent of its FY 2005 
budget authority through the assessment of user fees. This Act further 
requires that the NRC establish a schedule of charges that fairly and 
equitably allocates the aggregate amount of these charges among 
licensees.
    This proposed rule would establish the schedules of fees that are 
necessary to implement the Congressional mandate for FY 2005. The 
proposed rule would result in increases in the annual fees charged to 
certain licensees and holders of certificates, registrations, and 
approvals, and decreases in annual fees for others. Licensees affected 
by the annual fee increases and decreases include those that qualify as 
a small entity under NRC's size standards in 10 CFR 2.810. The 
Regulatory Flexibility

[[Page 8690]]

Analysis, prepared in accordance with 5 U.S.C. 604, is included as 
Appendix A to this proposed rule.
    The Small Business Regulatory Enforcement Fairness Act of 1996 
requires all Federal agencies to prepare a written compliance guide for 
each rule for which the agency is required by 5 U.S.C. 604 to prepare a 
regulatory flexibility analysis. Therefore, in compliance with the law, 
Attachment 1 to the Regulatory Flexibility Analysis is the small entity 
compliance guide for FY 2005.

IX. Backfit Analysis

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

List of Subjects

10 CFR Part 170

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

10 CFR Part 171

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

    For the reasons set out in the preamble and under the authority of 
the Atomic Energy Act of 1954, as amended; 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 170 and 171.

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

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

    Authority: Sec. 9701, Pub. L. 97-258, 96 Stat. 1051 (31 U.S.C. 
9701); sec. 301, Pub. L. 92-314, 86 Stat. 227 (42 U.S.C. 2201w); 
sec. 201, Pub. L. 93-438, 88 Stat. 1242, as amended (42 U.S.C. 
5841); sec. 205a, Pub. L. 101-576, 104 Stat. 2842, as amended (31 
U.S.C. 901, 902); sec. 1704, 112 Stat. 2750 (44 U.S.C. 3504 note).

    2. In Sec.  170.2, paragraph (t) is added to read as follows:


Sec.  170.2  Scope.

* * * * *
    (t) An owner or operator of an unlicensed site in decommissioning 
being conducted under NRC oversight.
    3. In Sec.  170.11, paragraphs (a)(1)(iii)(A)(1) and (2) are 
revised and paragraph (3) is added to read as follows:


Sec.  170.11  Exemptions.

    (a) * * *
    (1) * * *
    (iii) * * *
    (A) * * *
    (1) It has been demonstrated that the report/request has been 
submitted to the NRC specifically for the purpose of supporting NRC's 
development of generic guidance and regulations (e.g., rules, 
regulations, guides and policy statements);
    (2) The NRC, at the time the document is submitted, plans to use it 
for one of the purposes given in paragraph (a)(1)(iii)(A)(1) of this 
section. In this case, the exemption applies even if ultimately the NRC 
does not use the document as planned; and
    (3) The fee exemption is requested in writing by the person 
submitting the report/request to the Chief Financial Officer in 
accordance with 10 CFR 170.5, and the Chief Financial Officer grants 
this request in writing.
* * * * *
    4. Section 170.20 is revised to read as follows:


Sec.  170.20  Average cost per professional staff-hour.

    Fees for permits, licenses, amendments, renewals, special projects, 
part 55 re-qualification and replacement examinations and tests, other 
required reviews, approvals, and inspections under Sec. Sec.  170.21 
and 170.31 will be calculated using the following applicable 
professional staff-hour rates:
    (a) Reactor Program (Sec.  170.21 Activities): $205 per hour.
    (b) Nuclear Materials and Nuclear Waste Program (Sec.  170.31 
Activities): $198 per hour.
    5. In Sec.  170.21, Category K in the table and footnote 1 are 
revised and footnote 4 is added to read as follows:


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

* * * * *

                        Schedule of Facility Fees
                     [See footnotes at end of table]
------------------------------------------------------------------------
          Facility categories and type of fees             Fees \1\ \2\
------------------------------------------------------------------------
 
                              * * * * * * *
K. Import and export licenses:
    Licenses for the import and export only of
     production and utilization facilities or the export
     only of components for production and utilization
     facilities issued under 10 CFR Part 110.
        1. Application for import or export of
         production and utilization facilities \4\
         (including reactors and other facilities) and
         exports of components requiring Commission and
         Executive Branch review, for example, actions
         under 10 CFR 110.40(b).
            Application--new license, or amendment......         $12,900
        2. Application for export of reactor and other
         components requiring Executive Branch review
         only, for example, those actions under 10 CFR
         110.41(a)(1)-(8).
            Application--new license, or amendment......          $7,500
        3. Application for export of components
         requiring only the assistance of the Executive
         Branch to obtain foreign government assurances.
            Application--new license, or amendment......          $2,400

[[Page 8691]]

 
        4. Application for export of facility components
         and equipment (examples provided in 10 CFR part
         110, Appendix A, Items (5) through (9)) not
         requiring Commission or Executive Branch
         review, or obtaining foreign government
         assurances.
            Application--new license, or amendment......          $1,600
        5. Minor amendment of any active export or
         import license, for example, to extend the
         expiration date, change domestic information,
         or make other revisions which do not involve
         any substantive changes to license terms or
         conditions or to the type of facility or
         component authorized for export and therefore,
         do not require in-depth analysis or review or
         consultation with the Executive Branch, U.S.
         host state, or foreign government authorities.
            Amendment...................................            $300
 
                             * * * * * * *
------------------------------------------------------------------------
\1\ Fees will not be charged for orders related to civil penalties or
  other civil sanctions issued by the Commission under Sec.   2.202 of
  this chapter or for amendments resulting specifically from the
  requirements of these orders. For orders unrelated to civil penalties
  or other civil sanctions, fees will be charged for any resulting
  licensee-specific activities not otherwise exempted from fees under
  this chapter. Fees will be charged for approvals issued under a
  specific exemption provision of the Commission's regulations under
  Title 10 of the Code of Federal Regulations (e.g., 10 CFR 50.12, 73.5)
  and any other sections in effect now or in the future, regardless of
  whether the approval is in the form of a license amendment, letter of
  approval, safety evaluation report, or other form. Fees for licenses
  in this schedule that are initially issued for less than full power
  are based on review through the issuance of a full power license
  (generally full power is considered 100 percent of the facility's full
  rated power). Thus, if a licensee received a low power license or a
  temporary license for less than full power and subsequently receives
  full power authority (by way of license amendment or otherwise), the
  total costs for the license will be determined through that period
  when authority is granted for full power operation. If a situation
  arises in which the Commission determines that full operating power
  for a particular facility should be less than 100 percent of full
  rated power, the total costs for the license will be at that
  determined lower operating power level and not at the 100 percent
  capacity.
* * * * * * *
\4\ Imports only of major components for end-use at NRC-licensed
  reactors are now authorized under NRC general import license.

    6. Section 170.31 is revised to read as follows:


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

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

                       Schedule of Materials Fees
                     [See footnotes at end of table]
------------------------------------------------------------------------
   Category of materials licenses and type of
                    fees\1\                            Fee \2\ \3\
------------------------------------------------------------------------
1. Special nuclear material:
    A.(1) Licenses for possession and use of U-
     235 or plutonium for fuel fabrication
     activities.
        (a) Strategic Special Nuclear Material   Full Cost.
         (High Enriched Uranium).
        (b) Low Enriched Uranium in Dispersible  Full Cost.
         Form Used for Fabrication of Power
         Reactor Fuel.
    (2) All other special nuclear materials
     licenses not included in Category 1.A.(1)
     which are licensed for fuel cycle
     activities.
        (a) Facilities with limited operations.  Full Cost.
        (b) All Others.........................  Full Cost.
    B. Licenses for receipt and storage of
     spent fuel and reactor-related Greater
     than Class C (GTCC) waste at an
     independent spent fuel storage
     installation (ISFSI):
        Licensing and inspection...............  Full Cost.
    C. Licenses for possession and use of
     special nuclear material in sealed sources
     contained in devices used in industrial
     measuring systems, including x-ray
     fluorescence analyzers: \4\
        Application............................  $910.
    D. All other special nuclear material
     licenses, except licenses authorizing
     special nuclear material in unsealed form
     in combination that would constitute a
     critical quantity, as defined in Sec.
     150.11 of this chapter, for which the
     licensee shall pay the same fees as those
     for Category 1A: \4\
        Application............................  $1,800.
    E. Licenses or certificates for
     construction and operation of a uranium
     enrichment facility:
        Licensing and inspection...............  Full Cost.
2. Source material:
    A.(1) Licenses for possession and use of     Full Cost.
     source material for refining uranium mill
     concentrates to uranium hexafluoride.
    (2) Licenses for possession and use of
     source material in recovery operations
     such as milling, in-situ leaching, heap-
     leaching, ore buying stations, ion
     exchange facilities and in processing of
     ores containing source material for
     extraction of metals other than uranium or
     thorium, including licenses authorizing
     the possession of byproduct waste material
     (tailings) from source material recovery
     operations, as well as licenses
     authorizing the possession and maintenance
     of a facility in a standby mode.
        (a) Class I facilities \4\.............  Full Cost.
        (b) Class II facilities \4\............  Full Cost.
        (c) Other facilities \4\...............  Full Cost.

[[Page 8692]]

 
    (3) Licenses that authorize the receipt of   Full Cost.
     byproduct material, as defined in Section
     11e.(2) of the Atomic Energy Act, from
     other persons for possession and disposal,
     except those licenses subject to the fees
     in Category 2A(2) or Category 2A(4).
    (4) Licenses that authorize the receipt of   Full Cost.
     byproduct material, as defined in Section
     11e.(2) of the Atomic Energy Act, from
     other persons for possession and disposal
     incidental to the disposal of the uranium
     waste tailings generated by the licensee's
     milling operations, except those licenses
     subject to the fees in Category 2A(2).
    B. Licenses which authorize the possession,
     use, and/or installation of source
     material for shielding:
        Application............................  $220.
    C. All other source material licenses:
        Application............................  $7,800.
3. Byproduct material:
    A. Licenses of broad scope for the
     possession and use of byproduct material
     issued under parts 30 and 33 of this
     chapter for processing or manufacturing of
     items containing byproduct material for
     commercial distribution:
        Application............................  $9,300.
    B. Other licenses for possession and use of
     byproduct material issued under part 30 of
     this chapter for processing or
     manufacturing of items containing
     byproduct material for commercial
     distribution:
        Application............................  $3,500.
    C. Licenses issued under Sec.  Sec.   32.72
     and/or 32.74 of this chapter that
     authorize the processing or manufacturing
     and distribution or redistribution of
     radiopharmaceuticals, generators, reagent
     kits, and/or sources and devices
     containing byproduct material. This
     category does not apply to licenses issued
     to nonprofit educational institutions
     whose processing or manufacturing is
     exempt under Sec.   170.11(a)(4). These
     licenses are covered by fee Category 3D.
        Application............................  $4,700.
    D. Licenses and approvals issued under Sec.
      Sec.   32.72 and/or 32.74 of this chapter
     authorizing distribution or redistribution
     of radiopharmaceuticals, generators,
     reagent kits, and/or sources or devices
     not involving processing of byproduct
     material. This category includes licenses
     issued under Sec.  Sec.   32.72 and/or
     32.74 of this chapter to nonprofit
     educational institutions whose processing
     or manufacturing is exempt under Sec.
     170.11(a)(4).
        Application............................  $3,400.
    E. Licenses for possession and use of
     byproduct material in sealed sources for
     irradiation of materials in which the
     source is not removed from its shield
     (self-shielded units):
        Application............................  $2,300.
    F. Licenses for possession and use of less
     than 10,000 curies of byproduct material
     in sealed sources for irradiation of
     materials in which the source is exposed
     for irradiation purposes. This category
     also includes underwater irradiators for
     irradiation of materials where the source
     is not exposed for irradiation purposes.
        Application............................  $4,600.
    G. Licenses for possession and use of
     10,000 curies or more of byproduct
     material in sealed sources for irradiation
     of materials in which the source is
     exposed for irradiation purposes. This
     category also includes underwater
     irradiators for irradiation of materials
     where the source is not exposed for
     irradiation purposes.
        Application............................  $11,000.
    H. Licenses issued under Subpart A of part
     32 of this chapter to distribute items
     containing byproduct material that require
     device review to persons exempt from the
     licensing requirements of part 30 of this
     chapter. The category does not include
     specific licenses authorizing
     redistribution of items that have been
     authorized for distribution to persons
     exempt from the licensing requirements of
     part 30 of this chapter:
        Application............................  $13,500.
    I. Licenses issued under Subpart A of part
     32 of this chapter to distribute items
     containing byproduct material or
     quantities of byproduct material that do
     not require device evaluation to persons
     exempt from the licensing requirements of
     part 30 of this chapter. This category
     does not include specific licenses
     authorizing redistribution of items that
     have been authorized for distribution to
     persons exempt from the licensing
     requirements of part 30 of this chapter:
        Application............................  $8,000.
    J. Licenses issued under Subpart B of part
     32 of this chapter to distribute items
     containing byproduct material that require
     sealed source and/or device review to
     persons generally licensed under part 31
     of this chapter. This category does not
     include specific licenses authorizing
     redistribution of items that have been
     authorized for distribution to persons
     generally licensed under part 31 of this
     chapter:
        Application............................  $1,400.
    K. Licenses issued under Subpart B of part
     32 of this chapter to distribute items
     containing byproduct material or
     quantities of byproduct material that do
     not require sealed source and/or device
     review to persons generally licensed under
     part 31 of this chapter. This category
     does not include specific licenses
     authorizing redistribution of items that
     have been authorized for distribution to
     persons generally licensed under part 31
     of this chapter:
        Application............................  $810.
    L. Licenses of broad scope for possession
     and use of byproduct material issued under
     parts 30 and 33 of this chapter for
     research and development that do not
     authorize commercial distribution:
        Application............................  $7,800.
    M. Other licenses for possession and use of
     byproduct material issued under part 30 of
     this chapter for research and development
     that do not authorize commercial
     distribution:
        Application............................  $3,100.
    N. Licenses that authorize services for
     other licensees, except:
        (1) Licenses that authorize only
         calibration and/or leak testing
         services are subject to the fees
         specified in fee Category 3P; and
        (2) Licenses that authorize waste
         disposal services are subject to the
         fees specified in fee Categories 4A,
         4B, and 4C:
        Application............................  $3,500.
    O. Licenses for possession and use of
     byproduct material issued under part 34 of
     this chapter for industrial radiography
     operations:
        Application............................  $3,200.

[[Page 8693]]

 
    P. All other specific byproduct material
     licenses, except those in Categories 4A
     through 9D:
        Application............................  $1,100.
    Q. Registration of a device(s) generally
     licensed under part 31 of this chapter:
        Registration...........................  $630.
4. Waste disposal and processing:
    A. Licenses specifically authorizing the
     receipt of waste byproduct material,
     source material, or special nuclear
     material from other persons for the
     purpose of contingency storage or
     commercial land disposal by the licensee;
     or licenses authorizing contingency
     storage of low-level radioactive waste at
     the site of nuclear power reactors; or
     licenses for receipt of waste from other
     persons for incineration or other
     treatment, packaging of resulting waste
     and residues, and transfer of packages to
     another person authorized to receive or
     dispose of waste material:
        Licensing and inspection...............  Full Cost.
    B. Licenses specifically authorizing the
     receipt of waste byproduct material,
     source material, or special nuclear
     material from other persons for the
     purpose of packaging or repackaging the
     material. The licensee will dispose of the
     material by transfer to another person
     authorized to receive or dispose of the
     material:
        Application............................  $2,400.
    C. Licenses specifically authorizing the
     receipt of prepackaged waste byproduct
     material, source material, or special
     nuclear material from other persons. The
     licensee will dispose of the material by
     transfer to another person authorized to
     receive or dispose of the material:
        Application............................  $3,600.
5. Well logging:
    A. Licenses for possession and use of
     byproduct material, source material, and/
     or special nuclear material for well
     logging, well surveys, and tracer studies
     other than field flooding tracer studies:
        Application............................  $1,300.
    B. Licenses for possession and use of
     byproduct material for field flooding
     tracer studies:
        Licensing..............................  Full Cost.
6. Nuclear laundries:
    A. Licenses for commercial collection and
     laundry of items contaminated with
     byproduct material, source material, or
     special nuclear material:
        Application............................  $15,800.
7. Medical licenses:
    A. Licenses issued under parts 30, 35, 40,
     and 70 of this chapter for human use of
     byproduct material, source material, or
     special nuclear material in sealed sources
     contained in teletherapy devices:
        Application............................  $8,600.
    B. Licenses of broad scope issued to
     medical institutions or two or more
     physicians under parts 30, 33, 35, 40, and
     70 of this chapter authorizing research
     and development, including human use of
     byproduct material, except licenses for
     byproduct material, source material, or
     special nuclear material in sealed sources
     contained in teletherapy devices:
        Application............................  $6,200.
    C. Other licenses issued under parts 30,
     35, 40, and 70 of this chapter for human
     use of byproduct material, source
     material, and/or special nuclear material,
     except licenses for byproduct material,
     source material, or special nuclear
     material in sealed sources contained in
     teletherapy devices:
        Application............................  $2,100.
8. Civil defense:
    A. Licenses for possession and use of
     byproduct material, source material, or
     special nuclear material for civil defense
     activities:
        Application............................  $450.
9. Device, product, or sealed source safety
 evaluation:
    A. Safety evaluation of devices or products
     containing byproduct material, source
     material, or special nuclear material,
     except reactor fuel devices, for
     commercial distribution:
        Application--each device...............  $19,300.
    B. Safety evaluation of devices or products
     containing byproduct material, source
     material, or special nuclear material
     manufactured in accordance with the unique
     specifications of, and for use by, a
     single applicant, except reactor fuel
     devices:
        Application--each device...............  $19,300.
    C. Safety evaluation of sealed sources
     containing byproduct material, source
     material, or special nuclear material,
     except reactor fuel, for commercial
     distribution:
        Application--each source...............  $2,200.
    D. Safety evaluation of sealed sources
     containing byproduct material, source
     material, or special nuclear material,
     manufactured in accordance with the unique
     specifications of, and for use by, a
     single applicant, except reactor fuel:
        Application--each source...............  $750.
10. Transportation of radioactive material:
    A. Evaluation of casks, packages, and
     shipping containers:
        1. Spent Fuel, High-Level Waste, and
         plutonium air packages
            Licensing and inspection...........  Full Cost.
        2. Other Casks
        Licensing and inspection...............  Full Cost.
    B. Quality assurance program approvals
     issued under part 71 of this chapter.
        1. Users and Fabricators
            Application........................  $5,200.
            Inspections........................  Full Cost.
        2. Users
            Application........................  $5,200.
            Inspections........................  Full Cost.

[[Page 8694]]

 
    C. Evaluation of security plans, route
     approvals, route surveys, and
     transportation security devices (including
     immobilization devices):
        Licensing and inspection...............  Full Cost.
11. Review of standardized spent fuel
 facilities:
    Licensing and inspection                     Full Cost.
12. Special projects:
    Approvals and preapplication/Licensing       Full Cost.
     activities.
    Inspections................................  Full Cost.
13. A. Spent fuel storage cask Certificate of
 Compliance:
    Licensing..................................  Full Cost.
    Inspections................................  Full Cost.
    B. Inspections related to storage of spent   Full Cost.
     fuel under Sec.   72.210 of this chapter.
14. A. Byproduct, source, or special nuclear
 material licenses and other approvals
 authorizing decommissioning, decontamination,
 reclamation, or site restoration activities
 under parts 30, 40, 70, 72, and 76 of this
 chapter:
        Licensing and inspection...............  Full Cost.
    B. Site-specific decommissioning activities  Full Cost.
     associated with unlicensed sites,
     regardless of whether or not the sites
     have been previously licensed.
15. Import and Export licenses:
    Licenses issued under part 110 of this
     chapter for the import and export only of
     special nuclear material, source material,
     tritium and other byproduct material, and
     the export only of heavy water, or nuclear
     grade graphite.
        A. Application for export or import of
         nuclear materials, including
         radioactive waste requiring Commission
         and Executive Branch review, for
         example, those actions under 10 CFR
         110.40(b). This category includes
         application for export and import of
         radioactive waste.
            Application--new license, or         $12,900.
             amendment.
        B. Application for export or import of
         nuclear material, including
         radioactive waste, requiring Executive
         Branch review, but not Commission
         review. This category includes
         application for the export and import
         of radioactive waste and requires NRC
         to consult with domestic host state
         authorities, Low-Level Radioactive
         Waste Compact Commission, the U.S.
         Environmental Protection Agency, etc.
            Application--new license, or         $7,500.
             amendment.
        C. Application for export of nuclear
         material, for example, routine reloads
         of low enriched uranium reactor fuel
         and/or natural uranium source material
         requiring only the assistance of the
         Executive Branch to obtain foreign
         government assurances.
            Application--new license, or         $2,400.
             amendment.
        D. Application for export or import of
         nuclear material, including
         radioactive waste, not requiring
         Commission or Executive Branch review,
         or obtaining foreign government
         assurances. This category includes
         application for export or import of
         radioactive waste where the NRC has
         previously authorized the export or
         import of the same form of waste to or
         from the same or similar parties
         located in the same country, requiring
         only confirmation from the receiving
         facility and licensing authorities
         that the shipments may proceed
         according to previously agreed
         understandings and procedures.
            Application--new license, or         $1,600.
             amendment.
        E. Minor amendment of any active export
         or import license, for example, to
         extend the expiration date, change
         domestic information, or make other
         revisions which do not involve any
         substantive changes to license terms
         and conditions or to the type/quantity/
         chemical composition of the material
         authorized for export and therefore,
         do not require in-depth analysis,
         review, or consultations with other
         Executive Branch, U.S. host state, or
         foreign government authorities.
            Amendment..........................  $300.
16. Reciprocity:
    Agreement State licensees who conduct
     activities under the reciprocity
     provisions of 10 CFR 150.20.
        Application............................  $1,800.
17. Master materials licenses of broad scope     N/A.\5\
 issued to Government agencies.
18. Department of Energy
    A. Certificates of Compliance..............  N/A.\5\
    B. Uranium Mill Tailing Radiation..........  N/A.\5\
------------------------------------------------------------------------
\1\ Types of fees--Separate charges, as shown in the schedule, will be
  assessed for pre-application consultations and reviews; applications
  for new licenses, approvals, or license terminations; possession only
  licenses; issuance of new licenses and approvals; certain amendments
  and renewals to existing licenses and approvals; safety evaluations of
  sealed sources and devices; generally licensed device registrations;
  and certain inspections. The following guidelines apply to these
  charges:
(a) Application and registration fees. Applications for new materials
  licenses and export and import licenses; applications to reinstate
  expired, terminated, or inactive licenses except those subject to fees
  assessed at full costs; applications filed by Agreement State
  licensees to register under the general license provisions of 10 CFR
  150.20; and applications for amendments to materials licenses that
  would place the license in a higher fee category or add a new fee
  category must be accompanied by the prescribed application fee for
  each category.
(1) Applications for licenses covering more than one fee category of
  special nuclear material or source material must be accompanied by the
  prescribed application fee for the highest fee category.
(2) Applications for new licenses that cover both byproduct material and
  special nuclear material in sealed sources for use in gauging devices
  will pay the appropriate application fee for fee Category 1C only.
(b) Licensing fees. Fees for reviews of applications for new licenses
  and for renewals and amendments to existing licenses, for pre-
  application consultations and for reviews of other documents submitted
  to NRC for review, and for project manager time for fee categories
  subject to full cost fees (fee Categories 1A, 1B, 1E, 2A, 4A, 5B, 10A,
  11, 12, 13A, and 14) are due upon notification by the Commission in
  accordance with Sec.   170.12(b).
(c) Amendment fees. Applications for amendments to export and import
  licenses must be accompanied by the prescribed amendment fee for each
  license affected. An application for an amendment to a license or
  approval classified in more than one fee category must be accompanied
  by the prescribed amendment fee for the category affected by the
  amendment unless the amendment is applicable to two or more fee
  categories, in which case the amendment fee for the highest fee
  category would apply.

[[Page 8695]]

 
(d) Inspection fees. Inspections resulting from investigations conducted
  by the Office of Investigations and non-routine inspections that
  result from third-party allegations are not subject to fees.
  Inspection fees are due upon notification by the Commission in
  accordance with Sec.   170.12(c).
(e) Generally licensed device registrations under 10 CFR 31.5.
  Submittals of registration information must be accompanied by the
  prescribed fee.
\2\ Fees will not be charged for orders related to civil penalties or
  other civil sanctions issued by the Commission under 10 CFR 2.202 or
  for amendments resulting specifically from the requirements of these
  orders. For orders unrelated to civil penalties or other civil
  sanctions, fees will be charged for any resulting licensee-specific
  activities not otherwise exempted from fees under this chapter. Fees
  will be charged for approvals issued under a specific exemption
  provision of the Commission's regulations under Title 10 of the Code
  of Federal Regulations (e.g., 10 CFR 30.11, 40.14, 70.14, 73.5, and
  any other sections in effect now or in the future), regardless of
  whether the approval is in the form of a license amendment, letter of
  approval, safety evaluation report, or other form. In addition to the
  fee shown, an applicant may be assessed an additional fee for sealed
  source and device evaluations as shown in Categories 9A through 9D.
\3\ Full cost fees will be determined based on the professional staff
  time multiplied by the appropriate professional hourly rate
  established in Sec.   170.20 in effect at the time the service is
  provided, and the appropriate contractual support services expended.
  For applications currently on file for which review costs have reached
  an applicable fee ceiling established by the June 20, 1984, and July
  2, 1990, rules, but are still pending completion of the review, the
  cost incurred after any applicable ceiling was reached through January
  29, 1989, will not be billed to the applicant. Any professional staff-
  hours expended above those ceilings on or after January 30, 1989, will
  be assessed at the applicable rates established by Sec.   170.20, as
  appropriate, except for topical reports whose costs exceed $50,000.
  Costs which exceed $50,000 for each topical report, amendment,
  revision, or supplement to a topical report completed or under review
  from January 30, 1989, through August 8, 1991, will not be billed to
  the applicant. Any professional hours expended on or after August 9,
  1991, will be assessed at the applicable rate established in Sec.
  170.20.
\4\ Licensees paying fees under Categories 1A, 1B, and 1E are not
  subject to fees under Categories 1C and 1D for sealed sources
  authorized in the same license except for an application that deals
  only with the sealed sources authorized by the license.
\5\ The NRC does not charge part 170 fees to Federal agencies, per 31
  U.S.C. 9701.

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

    7. The authority citation for part 171 continues to read as 
follows:

    Authority: Sec. 7601, Pub. L. 99-272, 100 Stat. 146, as amended 
by sec. 5601, Pub. L. 100-203, 101 Stat. 1330, as amended by sec. 
3201, Pub. L. 101-239, 103 Stat. 2132, as amended by sec. 6101, Pub. 
L. 101-508, 104 Stat. 1388, as amended by sec. 2903a, Pub. L. 102-
486, 106 Stat. 3125 (42 U.S.C. 2213, 2214); sec. 301, Pub. L. 92-
314, 86 Stat. 227 (42 U.S.C. 2201w); sec. 201, Pub. L. 93-438, 88 
Stat. 1242, as amended (42 U.S.C. 5841); sec. 1704, 112 Stat. 2750 
(44 U.S.C. 3504 note).


Sec.  171.11  [Amended]

    8. Section 171.11 is amended by removing paragraph (c)(2), and 
paragraphs (c)(3), (c)(4), and (c)(5) are redesignated as (c)(2), 
(c)(3), and (c)(4), respectively.
    9. In Sec.  171.15 paragraphs (b), (c), (d), and (e) are revised to 
read as follows:


Sec.  171.15  Annual Fees: Reactor licenses and independent spent fuel 
storage licenses.

* * * * *
    (b)(1) The FY 2005 annual fee for each operating power reactor 
which must be collected by September 30, 2005, is $3,067,000.
    (2) The FY 2005 annual fee is comprised of a base annual fee for 
power reactors licensed to operate, a base spent fuel storage/reactor 
decommissioning annual fee, and associated additional charges 
(surcharges). The activities comprising the FY 2005 spent storage/
reactor decommissioning base annual fee are shown in paragraphs 
(c)(2)(i) and (ii) of this section. The activities comprising the FY 
2005 surcharge are shown in paragraph (d)(1) of this section. The 
activities comprising the FY 2005 base annual fee for operating power 
reactors are as follows:
    (i) Power reactor safety and safeguards regulation except licensing 
and inspection activities recovered under part 170 of this chapter and 
generic reactor decommissioning activities.
    (ii) Research activities directly related to the regulation of 
power reactors, except those activities specifically related to reactor 
decommissioning.
    (iii) Generic activities required largely for NRC to regulate power 
reactors (e.g., updating part 50 of this chapter, or operating the 
Incident Response Center). The base annual fee for operating power 
reactors does not include generic activities specifically related to 
reactor decommissioning.
    (c)(1) The FY 2005 annual fee for each power reactor holding a part 
50 license that is in a decommissioning or possession only status and 
has spent fuel onsite and each independent spent fuel storage part 72 
licensee who does not hold a part 50 license is $164,000.
    (2) The FY 2005 annual fee is comprised of a base spent fuel 
storage/reactor decommissioning annual fee (which is also included in 
the operating power reactor annual fee shown in paragraph (b) of this 
section), and an additional charge (surcharge). The activities 
comprising the FY 2005 surcharge are shown in paragraph (d)(1) of this 
section. The activities comprising the FY 2005 spent fuel storage/
reactor decommissioning rebaselined annual fee are:
    (i) Generic and other research activities directly related to 
reactor decommissioning and spent fuel storage; and
    (ii) Other safety, environmental, and safeguards activities related 
to reactor decommissioning and spent fuel storage, except costs for 
licensing and inspection activities that are recovered under part 170 
of this chapter.
    (d)(1) The activities comprising the FY 2005 surcharge are as 
follows:
    (i) Low-level waste disposal generic activities;
    (ii) Activities not attributable to an existing NRC licensee or 
class of licenses (e.g., international cooperative safety program and 
international safeguards activities, support for the Agreement State 
program, decommissioning activities for unlicensed sites, and 
activities for unregistered general licensees); and
    (iii) Activities not currently subject to 10 CFR part 170 licensing 
and inspection fees based on existing law or Commission policy (e.g., 
reviews and inspections conducted of nonprofit educational 
institutions, licensing actions for Federal agencies, and costs that 
would not be collected from small entities based on Commission policy 
in accordance with the Regulatory Flexibility Act, 5 U.S.C. 601 et 
seq.).
    (2) The total FY 2005 surcharge allocated to the operating power 
reactor class of licenses is $3.3 million, not including the amount 
allocated to the spent fuel storage/reactor decommissioning class. The 
FY 2005 operating power reactor surcharge to be assessed to each 
operating power reactor is approximately $31,700. This amount is 
calculated by dividing the total operating power reactor surcharge 
($3.3 million) by the number of operating power reactors (104).
    (3) The FY 2005 surcharge allocated to the spent fuel storage/
reactor decommissioning class of licenses is $70,000. The FY 2005 spent 
fuel storage/reactor decommissioning surcharge to be assessed to each

[[Page 8696]]

operating power reactor, each power reactor in decommissioning or 
possession only status that has spent fuel onsite, and to each 
independent spent fuel storage part 72 licensee who does not hold a 
part 50 license is approximately $580. This amount is calculated by 
dividing the total surcharge costs allocated to this class by the total 
number of power reactor licenses, except those that permanently ceased 
operations and have no fuel onsite, and part 72 licensees who do not 
hold a part 50 license.
    (e) The FY 2005 annual fees for licensees authorized to operate a 
test and research (non-power) reactor licensed under part 50 of this 
chapter, unless the reactor is exempted from fees under Sec.  
171.11(a), are as follows:


Research reactor...........................................      $54,400
Test reactor...............................................       54,400
 


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


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

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

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

    (1) A licensee qualifies as a small entity if it meets the size 
standards established by the NRC (See 10 CFR 2.810).
    (2) A licensee who seeks to establish status as a small entity for 
the purpose of paying the annual fees required under this section must 
file a certification statement with the NRC. The licensee must file the 
required certification on NRC Form 526 for each license under which it 
is billed. NRC Form 526 can be accessed through the NRC's Web site at 
http://www.nrc.gov. For licensees who cannot access the NRC's Web site, 
NRC Form 526 may be obtained through the local point of contact listed 
in the NRC's ``Materials Annual Fee Billing Handbook,'' NUREG/BR-0238, 
which is enclosed with each annual fee billing. The form can also be 
obtained by calling the fee staff at (301) 415-7554, or by e-mailing 
the fee staff at [email protected].
    (3) For purposes of this section, the licensee must submit a new 
certification with its annual fee payment each year.
    (4) The maximum annual fee a small entity is required to pay is 
$2,300 for each category applicable to the license(s).
    (d) The FY 2005 annual fees are comprised of a base annual fee and 
an additional charge (surcharge). The activities comprising the FY 2005 
surcharge are shown for convenience in paragraph (e) of this section. 
The FY 2005 annual fees for materials licensees and holders of 
certificates, registrations or approvals subject to fees under this 
section are shown in the following table:

   Schedule of Materials Annual Fees and Fees for Government Agencies
                             Licensed by NRC
                     [See footnotes at end of table]
------------------------------------------------------------------------
                                                            Annual fees
             Category of materials licenses                 \1\ \2\ \3\
------------------------------------------------------------------------
1. Special nuclear material:
    A. (1) Licenses for possession and use of U-235 or
     plutonium for fuel fabrication activities.
        (a) Strategic Special Nuclear Material (High          $5,383,000
         Enriched Uranium)..............................
        (b) Low Enriched Uranium in Dispersible Form           1,612,000
         Used for Fabrication of Power Reactor Fuel.....
    (2) All other special nuclear materials licenses not
     included in Category 1.A.(1) which are licensed for
     fuel cycle activities.
        (a) Facilities with limited operations..........         633,000
        (b) All Others..................................         461,000
    B. Licenses for receipt and storage of spent fuel           \11\ N/A
     and reactor-related Greater than Class C (GTCC)
     waste at an independent spent fuel storage
     installation (ISFSI)...............................
    C. Licenses for possession and use of special                  2,100
     nuclear material in sealed sources contained in
     devices used in industrial measuring systems,
     including x-ray fluorescence analyzers.............
    D. All other special nuclear material licenses,                5,800
     except licenses authorizing special nuclear
     material in unsealed form in combination that would
     constitute a critical quantity, as defined in Sec.
      150.11 of this chapter, for which the licensee
     shall pay the same fees as those for Category
     1.A.(2)............................................

[[Page 8697]]

 
    E. Licenses or certificates for the operation of a         2,994,000
     uranium enrichment facility........................
2. Source material:
    A. (1) Licenses for possession and use of source             691,000
     material for refining uranium mill concentrates to
     uranium hexafluoride...............................
    (2) Licenses for possession and use of source
     material in recovery operations such as milling, in-
     situ leaching, heap-leaching, ore buying stations,
     ion exchange facilities and in processing of ores
     containing source material for extraction of metals
     other than uranium or thorium, including licenses
     authorizing the possession of byproduct waste
     material (tailings) from source material recovery
     operations, as well as licenses authorizing the
     possession and maintenance of a facility in a
     standby mode.
        (a) Class I facilities \4\......................          27,700
        (b) Class II facilities \4\.....................          27,700
        (c) Other facilities \4\........................          71,000
    (3) Licenses that authorize the receipt of byproduct         \5\ N/A
     material, as defined in Section 11e.(2) of the
     Atomic Energy Act, from other persons for
     possession and disposal, except those licenses
     subject to the fees in Category 2A(2) or Category
     2A(4)..............................................
    (4) Licenses that authorize the receipt of byproduct          27,700
     material, as defined in Section 11e.(2) of the
     Atomic Energy Act, from other persons for
     possession and disposal incidental to the disposal
     of the uranium waste tailings generated by the
     licensee's milling operations, except those
     licenses subject to the fees in Category 2A(2).....
    B. Licenses that authorize only the possession, use              750
     and/or installation of source material for
     shielding..........................................
    C. All other source material licenses...............          13,500
3. Byproduct material:
    A. Licenses of broad scope for possession and use of          24,800
     byproduct material issued under parts 30 and 33 of
     this chapter for processing or manufacturing of
     items containing byproduct material for commercial
     distribution.......................................
    B. Other licenses for possession and use of                    8,200
     byproduct material issued under part 30 of this
     chapter for processing or manufacturing of items
     containing byproduct material for commercial
     distribution.......................................
    C. Licenses issued under Sec.  Sec.   32.72 and/or            10,200
     32.74 of this chapter authorizing the processing or
     manufacturing and distribution or redistribution of
     radiopharmaceuticals, generators, reagent kits and/
     or sources and devices containing byproduct
     material. This category also includes the
     possession and use of source material for shielding
     authorized under part 40 of this chapter when
     included on the same license. This category does
     not apply to licenses issued to nonprofit
     educational institutions whose processing or
     manufacturing is exempt under Sec.   171.11(a)(1).
     These licenses are covered by fee under Category 3D
    D. Licenses and approvals issued under Sec.  Sec.              6,100
     32.72 and/or 32.74 of this chapter authorizing
     distribution or redistribution of
     radiopharmaceuticals, generators, reagent kits and/
     or sources or devices not involving processing of
     byproduct material. This category includes licenses
     issued under Sec.  Sec.   32.72 and 32.74 of this
     chapter to nonprofit educational institutions whose
     processing or manufacturing is exempt under Sec.
     171.11(a)(1). This category also includes the
     possession and use of source material for shielding
     authorized under part 40 of this chapter when
     included on the same license.......................
    E. Licenses for possession and use of byproduct                4,300
     material in sealed sources for irradiation of
     materials in which the source is not removed from
     its shield (self-shielded units)...................
    F. Licenses for possession and use of less than                7,800
     10,000 curies of byproduct material in sealed
     sources for irradiation of materials in which the
     source is exposed for irradiation purposes. This
     category also includes underwater irradiators for
     irradiation of materials in which the source is not
     exposed for irradiation purposes...................
    G. Licenses for possession and use of 10,000 curies           26,800
     or more of byproduct material in sealed sources for
     irradiation of materials in which the source is
     exposed for irradiation purposes. This category
     also includes underwater irradiators for
     irradiation of materials in which the source is not
     exposed for irradiation purposes...................
    H. Licenses issued under Subpart A of part 32 of              18,400
     this chapter to distribute items containing
     byproduct material that require device review to
     persons exempt from the licensing requirements of
     part 30 of this chapter, except specific licenses
     authorizing redistribution of items that have been
     authorized for distribution to persons exempt from
     the licensing requirements of part 30 of this
     chapter............................................
    I. Licenses issued under Subpart A of part 32 of              11,100
     this chapter to distribute items containing
     byproduct material or quantities of byproduct
     material that do not require device evaluation to
     persons exempt from the licensing requirements of
     part 30 of this chapter, except for specific
     licenses authorizing redistribution of items that
     have been authorized for distribution to persons
     exempt from the licensing requirements of part 30
     of this chapter....................................
    J. Licenses issued under Subpart B of part 32 of               2,800
     this chapter to distribute items containing
     byproduct material that require sealed source and/
     or device review to persons generally licensed
     under part 31 of this chapter, except specific
     licenses authorizing redistribution of items that
     have been authorized for distribution to persons
     generally licensed under part 31 of this chapter...
    K. Licenses issued under Subpart B of part 31 of               1,700
     this chapter to distribute items containing
     byproduct material or quantities of byproduct
     material that do not require sealed source and/or
     device review to persons generally licensed under
     part 31 of this chapter, except specific licenses
     authorizing redistribution of items that have been
     authorized for distribution to persons generally
     licensed under part 31 of this chapter.............
    L. Licenses of broad scope for possession and use of          14,700
     byproduct material issued under parts 30 and 33 of
     this chapter for research and development that do
     not authorize commercial distribution..............
    M. Other licenses for possession and use of                    6,100
     byproduct material issued under part 30 of this
     chapter for research and development that do not
     authorize commercial distribution..................
    N. Licenses that authorize services for other                  6,600
     licensees, except: (1) Licenses that authorize only
     calibration and/or leak testing services are
     subject to the fees specified in fee Category 3P;
     and (2) Licenses that authorize waste disposal
     services are subject to the fees specified in fee
     categories 4A, 4B, and 4C..........................
    O. Licenses for possession and use of byproduct               12,800
     material issued under part 34 of this chapter for
     industrial radiography operations. This category
     also includes the possession and use of source
     material for shielding authorized under part 40 of
     this chapter when authorized on the same license...

[[Page 8698]]

 
    P. All other specific byproduct material licenses,             2,500
     except those in Categories 4A through 9D...........
    Q. Registration of devices generally licensed under         \13\ N/A
     part 31 of this chapter............................
4. Waste disposal and processing:
    A. Licenses specifically authorizing the receipt of          \5\ N/A
     waste byproduct material, source material, or
     special nuclear material from other persons for the
     purpose of contingency storage or commercial land
     disposal by the licensee; or licenses authorizing
     contingency storage of low-level radioactive waste
     at the site of nuclear power reactors; or licenses
     for receipt of waste from other persons for
     incineration or other treatment, packaging of
     resulting waste and residues, and transfer of
     packages to another person authorized to receive or
     dispose of waste material..........................
    B. Licenses specifically authorizing the receipt of           10,500
     waste byproduct material, source material, or
     special nuclear material from other persons for the
     purpose of packaging or repackaging the material.
     The licensee will dispose of the material by
     transfer to another person authorized to receive or
     dispose of the material............................
    C. Licenses specifically authorizing the receipt of            8,500
     prepackaged waste byproduct material, source
     material, or special nuclear material from other
     persons. The licensee will dispose of the material
     by transfer to another person authorized to receive
     or dispose of the material.........................
5. Well logging:
    A. Licenses for possession and use of byproduct                4,100
     material, source material, and/or special nuclear
     material for well logging, well surveys, and tracer
     studies other than field flooding tracer studies...
    B. Licenses for possession and use of byproduct              \5\ N/A
     material for field flooding tracer studies.........
6. Nuclear laundries:
    A. Licenses for commercial collection and laundry of          25,200
     items contaminated with byproduct material, source
     material, or special nuclear material..............
7. Medical licenses:
    A. Licenses issued under parts 30, 35, 40, and 70 of          13,700
     this chapter for human use of byproduct material,
     source material, or special nuclear material in
     sealed sources contained in teletherapy devices.
     This category also includes the possession and use
     of source material for shielding when authorized on
     the same license...................................
    B. Licenses of broad scope issued to medical                  27,300
     institutions or two or more physicians under parts
     30, 33, 35, 40, and 70 of this chapter authorizing
     research and development, including human use of
     byproduct material except licenses for byproduct
     material, source material, or special nuclear
     material in sealed sources contained in teletherapy
     devices. This category also includes the possession
     and use of source material for shielding when
     authorized on the same license.\9\.................
    C. Other licenses issued under parts 30, 35, 40, and           5,100
     70 of this chapter for human use of byproduct
     material, source material, and/or special nuclear
     material except licenses for byproduct material,
     source material, or special nuclear material in
     sealed sources contained in teletherapy devices.
     This category also includes the possession and use
     of source material for shielding when authorized on
     the same license.\9\...............................
8. Civil defense:
    A. Licenses for possession and use of byproduct                1,600
     material, source material, or special nuclear
     material for civil defense activities..............
9. Device, product, or sealed source safety evaluation:
    A. Registrations issued for the safety evaluation of          24,600
     devices or products containing byproduct material,
     source material, or special nuclear material,
     except reactor fuel devices, for commercial
     distribution.......................................
    B. Registrations issued for the safety evaluation of          24,600
     devices or products containing byproduct material,
     source material, or special nuclear material
     manufactured in accordance with the unique
     specifications of, and for use by, a single
     applicant, except reactor fuel devices.............
    C. Registrations issued for the safety evaluation of           2,800
     sealed sources containing byproduct material,
     source material, or special nuclear material,
     except reactor fuel, for commercial distribution...
    D. Registrations issued for the safety evaluation of             960
     sealed sources containing byproduct material,
     source material, or special nuclear material,
     manufactured in accordance with the unique
     specifications of, and for use by, a single
     applicant, except reactor fuel.....................
10. Transportation of radioactive material:
    A. Certificates of Compliance or other package
     approvals issued for design of casks, packages, and
     shipping containers.
        1. Spent Fuel, High-Level Waste, and plutonium           \6\ N/A
         air packages...................................
        2. Other Casks..................................         \6\ N/A
    B. Quality assurance program approvals issued under
     part 71 of this chapter.
        1. Users and Fabricators........................          80,200
        2. Users........................................           4,300
    C. Evaluation of security plans, route approvals,            \6\ N/A
     route surveys, and transportation security devices
     (including immobilization devices).................
11. Standardized spent fuel facilities..................         \6\ N/A
12. Special Projects....................................         \6\ N/A
13. A. Spent fuel storage cask Certificate of Compliance         \6\ N/A
    B. General licenses for storage of spent fuel under         \12\ N/A
     10 CFR 72.210
14. Decommissioning/Reclamation:
    A. Byproduct, source, or special nuclear material            \7\ N/A
     licenses and other approvals authorizing
     decommissioning, decontamination, reclamation, or
     site restoration activities under parts 30, 40, 70,
     72, and 76 of this chapter.........................
    B. Site-specific decommissioning activities                  \7\ N/A
     associated with unlicensed sites, regardless of
     whether or not the sites have been previously
     licensed...........................................
15. Import and Export licenses:

[[Page 8699]]

 
    Licenses issued under part 110 of this chapter for
     the import and export only of special nuclear
     material, source material, tritium and other
     byproduct material, and the export only of heavy
     water, or nuclear grade graphite.
    A. Licenses for export or import of nuclear                  \8\ N/A
     materials, including radioactive waste requiring
     Commission and Executive Branch review, for
     example, those actions under 10 CFR 110.40(b). This
     category includes licenses for export and import of
     radioactive waste..................................
    B. Licenses for export or import of nuclear                  \8\ N/A
     material, radioactive waste, requiring Executive
     Branch review, but not Commission review. This
     category includes licenses for the export and
     import of radioactive waste and requires NRC to
     consult with domestic host state authorities, Low-
     Level Radioactive Waste Compact Commission, the
     U.S. Environmental Protection Agency, etc..........
    C. Licenses for export of nuclear material, for              \8\ N/A
     example, routine reloads of low enriched uranium
     reactor fuel and/or natural uranium source material
     requiring only the assistance of the Executive
     Branch to obtain foreign government assurances.....
    D. Licenses for export or import of nuclear                  \8\ N/A
     material, including radioactive waste, not
     requiring Commission or Executive Branch review, or
     obtaining foreign government assurances. This
     category includes licenses for export or import of
     radioactive waste where the NRC has previously
     authorized the export or import of the same form of
     waste to or from the same or similar parties
     located in the same country, requiring only
     confirmation from the receiving facility and
     licensing authorities that the shipments may
     proceed according to previously agreed
     understandings and procedures......................
    E. Minor amendment of any active export or import            \8\ N/A
     license, for example, to extend the expiration
     date, change domestic information, or make other
     revisions which do not involve any substantive
     changes to license terms and conditions or to the
     type/quantity/chemical composition of the material
     authorized for export and therefore, do not require
     in-depth analysis, review, or consultations with
     other Executive Branch, U.S. host state, or foreign
     government authorities.............................
16. Reciprocity.........................................         \8\ N/A
17. Master materials licenses of broad scope issued to           251,000
 Government agencies....................................
18. Department of Energy:
    A. Certificates of Compliance.......................  \10\ 1,087,000
    B. Uranium Mill Tailing Radiation Control Act               539,000
     (UMTRCA) activities................................
------------------------------------------------------------------------
\1\ Annual fees will be assessed based on whether a licensee held a
  valid license with the NRC authorizing possession and use of
  radioactive material, or a construction authorization for a mixed
  oxide fuel facility, during the current fiscal year. However, the
  annual fee is waived for those materials licenses and holders of
  certificates, registrations, and approvals who either filed for
  termination of their licenses or approvals or filed for possession
  only/storage licenses before October 1, 2004, and permanently ceased
  licensed activities entirely by September 30, 2004. Annual fees for
  licensees who filed for termination of a license, downgrade of a
  license, or for a possession only license during the fiscal year and
  for new licenses issued during the fiscal year will be prorated in
  accordance with the provisions of Sec.   171.17. If a person holds
  more than one license, certificate, registration, or approval, the
  annual fee(s) will be assessed for each license, certificate,
  registration, or approval held by that person. For licenses that
  authorize more than one activity on a single license (e.g., human use
  and irradiator activities), annual fees will be assessed for each
  category applicable to the license. Licensees paying annual fees under
  Category 1A(1) are not subject to the annual fees for Category 1C and
  1D for sealed sources authorized in the license.
\2\ Payment of the prescribed annual fee does not automatically renew
  the license, certificate, registration, or approval for which the fee
  is paid. Renewal applications must be filed in accordance with the
  requirements of parts 30, 40, 70, 71, 72, or 76 of this chapter.
\3\ Each fiscal year, fees for these materials licenses will be
  calculated and assessed in accordance with Sec.   171.13 and will be
  published in the Federal Register for notice and comment.
\4\ A Class I license includes mill licenses issued for the extraction
  of uranium from uranium ore. A Class II license includes solution
  mining licenses (in-situ and heap leach) issued for the extraction of
  uranium from uranium ores including research and development licenses.
  An ``other'' license includes licenses for extraction of metals, heavy
  metals, and rare earths.
\5\ There are no existing NRC licenses in these fee categories. If NRC
  issues a license for these categories, the Commission will consider
  establishing an annual fee for this type of license.
\6\ Standardized spent fuel facilities, 10 CFR parts 71 and 72
  Certificates of Compliance, and special reviews, such as topical
  reports, are not assessed an annual fee because the generic costs of
  regulating these activities are primarily attributable to users of the
  designs, certificates, and topical reports.
\7\ Licensees in this category are not assessed an annual fee because
  they are charged an annual fee in other categories while they are
  licensed to operate.
\8\ No annual fee is charged because it is not practical to administer
  due to the relatively short life or temporary nature of the license.
\9\ Separate annual fees will not be assessed for pacemaker licenses
  issued to medical institutions who also hold nuclear medicine licenses
  under Categories 7B or 7C.
\10\ This includes Certificates of Compliance issued to DOE that are not
  under the Nuclear Waste Fund.
\11\ See Sec.   171.15(c).
\12\ See Sec.   171.15(c).
\13\ No annual fee is charged for this category because the cost of the
  general license registration program applicable to licenses in this
  category will be recovered through 10 CFR part 170 fees.

    (e) The activities comprising the surcharge are as follows:
    (1) LLW disposal generic activities;
    (2) Activities not directly attributable to an existing NRC 
licensee or class(es) of licenses (e.g., international cooperative 
safety program and international safeguards activities; support for the 
Agreement State program; decommissioning activities for unlicensed 
sites; and activities for unregistered general licensees); and
    (3) Activities not currently assessed licensing and inspection fees 
under 10 CFR part 170 based on existing law or Commission policy (e.g., 
reviews and inspections of nonprofit educational institutions and 
reviews for Federal agencies; activities related to decommissioning and 
reclamation; and costs that would not be collected from small entities 
based on Commission policy in accordance with the Regulatory 
Flexibility Act, 5 U.S.C. 601 et seq.).

    Dated at Rockville, Maryland, this 10th day of February, 2005.

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

    Note: This appendix will not appear in the Code of Federal 
Regulations.


[[Page 8700]]



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

I. Background

    The Regulatory Flexibility Act (RFA), as amended (5 U.S.C. 601 
et seq.), requires that agencies consider the impact of their 
rulemakings on small entities and, consistent with applicable 
statutes, consider alternatives to minimize these impacts on the 
businesses, organizations, and government jurisdictions to which 
they apply.
    The NRC has established standards for determining which NRC 
licensees qualify as small entities (10 CFR 2.810). These size 
standards were established based on the Small Business 
Administration's most common receipts-based size standards and 
include a size standard for business concerns that are manufacturing 
entities. The NRC uses the size standards to reduce the impact of 
annual fees on small entities by establishing a licensee's 
eligibility to qualify for a maximum small entity fee. The small 
entity fee categories in Sec.  171.16(c) of this proposed rule are 
based on the NRC's size standards.
    From FY 1991 through FY 2000, the Omnibus Budget Reconciliation 
Act (OBRA-90), as amended, required that the NRC recover 
approximately 100 percent of its budget authority, less 
appropriations from the Nuclear Waste Fund, by assessing license and 
annual fees. The FY 2001 Energy and Water Development Appropriations 
Act amended OBRA-90 to decrease the NRC's fee recovery amount by 2 
percent per year beginning in FY 2001, until the fee recovery amount 
is 90 percent in FY 2005. The amount to be recovered for FY 2005 is 
approximately $540.7 million.
    OBRA-90 requires that the schedule of charges established by 
rulemaking should fairly and equitably allocate the total amount to 
be recovered from the NRC's licensees and be assessed under the 
principle that licensees who require the greatest expenditure of 
agency resources pay the greatest annual charges. Since FY 1991, the 
NRC has complied with OBRA-90 by issuing a final rule that amends 
its fee regulations. These final rules have established the 
methodology used by NRC in identifying and determining the fees to 
be assessed and collected in any given fiscal year.
    In FY 1995, the NRC announced that, to stabilize fees, annual 
fees would be adjusted only by the percentage change (plus or minus) 
in NRC's total budget authority, adjusted for changes in estimated 
collections for 10 CFR part 170 fees, the number of licensees paying 
annual fees, and as otherwise needed to assure the billed amounts 
resulted in the required collections. The NRC indicated that if 
there were a substantial change in the total NRC budget authority or 
the magnitude of the budget allocated to a specific class of 
licenses, the annual fee base would be recalculated.
    In FY 1999, the NRC concluded that there had been significant 
changes in the allocation of agency resources among the various 
classes of licenses and established rebaselined annual fees for FY 
1999. The NRC stated in the final FY 1999 rule that to stabilize 
fees it would continue to adjust the annual fees by the percent 
change method established in FY 1995, unless there is a substantial 
change in the total NRC budget or the magnitude of the budget 
allocated to a specific class of licenses, in which case the annual 
fee base would be reestablished.
    Based on the change in the magnitude of the budget to be 
recovered through fees, the Commission has determined that it is 
appropriate to rebaseline its part 171 annual fees again in FY 2005. 
Rebaselining fees will result in decreased annual fees for the 
majority of the fee classes of licensees. However, annual fees would 
increase for other classes including most materials licensees in the 
materials users class.
    The Small Business Regulatory Enforcement Fairness Act of 1996 
(SBREFA) is intended to reduce regulatory burdens imposed by Federal 
agencies on small businesses, nonprofit organizations, and 
governmental jurisdictions. SBREFA also provides Congress with the 
opportunity to review agency rules before they go into effect. Under 
this legislation, the NRC annual fee rule is considered a ``major'' 
rule and must be reviewed by Congress and the Comptroller General 
before the rule becomes effective. SBREFA also requires that an 
agency prepare a guide to assist small entities in complying with 
each rule for which a final regulatory flexibility analysis is 
prepared. This Regulatory Flexibility Analysis (RFA) and the small 
entity compliance guide (Attachment 1) have been prepared for the FY 
2005 fee rule as required by law.

II. Impact on Small Entities

    The fee rule results in substantial fees being charged to those 
individuals, organizations, and companies that are licensed by the 
NRC, including those licensed under the NRC materials program. The 
comments received on previous proposed fee rules and the small 
entity certifications received in response to previous final fee 
rules indicate that NRC licensees qualifying as small entities under 
the NRC's size standards are primarily materials licensees. 
Therefore, this analysis will focus on the economic impact of the 
annual fees on materials licensees. About 26 percent of these 
licensees (approximately 1,200 licensees for FY 2004) have requested 
small entity certification in the past. A 1993 NRC survey of its 
materials licensees indicated that about 25 percent of these 
licensees could qualify as small entities under the NRC's size 
standards.
    The commenters on previous fee rulemakings consistently 
indicated that the following results would occur if the proposed 
annual fees were not modified:
    1. Large firms would gain an unfair competitive advantage over 
small entities. Commenters noted that small and very small companies 
(``Mom and Pop'' operations) would find it more difficult to absorb 
the annual fee than a large corporation or a high-volume type of 
operation. In competitive markets, such as soil testing, annual fees 
would put small licensees at an extreme competitive disadvantage 
with their much larger competitors because the proposed fees would 
be the same for a two-person licensee as for a large firm with 
thousands of employees.
    2. Some firms would be forced to cancel their licenses. A 
licensee with receipts of less than $500,000 per year stated that 
the proposed rule would, in effect, force it to relinquish its soil 
density gauge and license, thereby reducing its ability to do its 
work effectively. Other licensees, especially well-loggers, noted 
that the increased fees would force small businesses to get rid of 
the materials license altogether. Commenters stated that the 
proposed rule would result in about 10 percent of the well-logging 
licensees terminating their licenses immediately and approximately 
25 percent terminating their licenses before the next annual 
assessment.
    3. Some companies would go out of business.
    4. Some companies would have budget problems. Many medical 
licensees noted that, along with reduced reimbursements, the 
proposed increase of the existing fees and the introduction of 
additional fees would significantly affect their budgets. Others 
noted that, in view of the cuts by Medicare and other third party 
carriers, the fees would produce a hardship and some facilities 
would experience a great deal of difficulty in meeting this 
additional burden.
    Approximately 3,000 license, approval, and registration 
terminations have been requested since the NRC first established 
annual fees for materials licenses. Although some of these 
terminations were requested because the license was no longer needed 
or licenses or registrations could be combined, indications are that 
other termination requests were due to the economic impact of the 
fees.
    To alleviate the significant impact of the annual fees on a 
substantial number of small entities, the NRC considered the 
following alternatives in accordance with the RFA in developing each 
of its fee rules since FY 1991.
    1. Base fees on some measure of the amount of radioactivity 
possessed by the licensee (e.g., number of sources).
    2. Base fees on the frequency of use of the licensed radioactive 
material (e.g., volume of patients).
    3. Base fees on the NRC size standards for small entities.
    The NRC has reexamined its previous evaluations of these 
alternatives and continues to believe that establishment of a 
maximum fee for small entities is the most appropriate and effective 
option for reducing the impact of its fees on small entities.

III. Maximum Fee

    The RFA and its implementing guidance do not provide specific 
guidelines on what constitutes a significant economic impact on a 
small entity; therefore, the NRC has no benchmark to assist it in 
determining the amount or the percent of gross receipts that should 
be charged to a small entity. In developing the maximum small entity 
annual fee in FY 1991, the NRC examined its 10 CFR part 170 
licensing and inspection fees and Agreement State fees for those fee 
categories which were expected to have a substantial number of small 
entities. Six Agreement

[[Page 8701]]

States (Washington, Texas, Illinois, Nebraska, New York, and Utah), 
were used as benchmarks in the establishment of the maximum small 
entity annual fee in FY 1991. Because small entities in those 
Agreement States were paying the fees, the NRC concluded that these 
fees did not have a significant impact on a substantial number of 
small entities. Therefore, those fees were considered a useful 
benchmark in establishing the NRC maximum small entity annual fee.
    The NRC maximum small entity fee was established as an annual 
fee only. In addition to the annual fee, NRC small entity licensees 
were required to pay amendment, renewal and inspection fees. In 
setting the small entity annual fee, NRC ensured that the total 
amount small entities paid annually would not exceed the maximum 
paid in the six benchmark Agreement States.
    Of the six benchmark states, the maximum Agreement State fee of 
$3,800 in Washington was used as the ceiling for the total fees. 
Thus the NRC's small entity fee was developed to ensure that the 
total fees paid by NRC small entities would not exceed $3,800. Given 
the NRC's FY 1991 fee structure for inspections, amendments, and 
renewals, a small entity annual fee established at $1,800 allowed 
the total fee (small entity annual fee plus yearly average for 
inspections, amendments and renewal fees) for all categories to fall 
under the $3,800 ceiling.
    In FY 1992, the NRC introduced a second, lower tier to the small 
entity fee in response to concerns that the $1,800 fee, when added 
to the license and inspection fees, still imposed a significant 
impact on small entities with relatively low gross annual receipts. 
For purposes of the annual fee, each small entity size standard was 
divided into an upper and lower tier. Small entity licensees in the 
upper tier continued to pay an annual fee of $1,800 while those in 
the lower tier paid an annual fee of $400.
    Based on the changes that had occurred since FY 1991, the NRC 
re-analyzed its maximum small entity annual fees in FY 2000, and 
determined that the small entity fees should be increased by 25 
percent to reflect the increase in the average fees paid by other 
materials licensees since FY 1991, as well as changes in the fee 
structure for materials licensees. The structure of the fees that 
NRC charged to its materials licensees changed during the period 
between 1991 and 1999. Costs for materials license inspections, 
renewals, and amendments, which were previously recovered through 
part 170 fees for services, are now included in the part 171 annual 
fees assessed to materials licensees. As a result, the maximum small 
entity annual fee increased from $1,800 to $2,300 in FY 2000. By 
increasing the maximum annual fee for small entities from $1,800 to 
$2,300, the annual fee for many small entities was reduced while at 
the same time materials licensees, including small entities, would 
pay for most of the costs attributable to them. The costs not 
recovered from small entities are allocated to other materials 
licensees and to power reactors.
    While reducing the impact on many small entities, the NRC 
determined that the maximum annual fee of $2,300 for small entities 
may continue to have a significant impact on materials licensees 
with annual gross receipts in the thousands of dollars range. 
Therefore, the NRC continued to provide a lower-tier small entity 
annual fee for small entities with relatively low gross annual 
receipts, and for manufacturing concerns and educational 
institutions not State or publicly supported, with less than 35 
employees. The NRC also increased the lower tier small entity fee by 
the same percentage increase to the maximum small entity annual fee. 
This 25 percent increase resulted in the lower tier small entity fee 
increasing from $400 to $500 in FY 2000.
    The NRC examined the small entity fees again in FY 2003 (68 FR 
36717; June 18, 2003), and determined that a change was not 
warranted to the small entity fees established in FY 2003. The NRC 
stated in the Regulatory Flexibility Analysis for the FY 2001 final 
fee rule that it would re-examine the small entity fees every two 
years, in the same years in which it conducts the biennial review of 
fees as required by the CFO Act.
    Accordingly, the NRC re-examined the small entity fees for FY 
2005, and did not believe that a change to the small entity fees was 
warranted. Unlike the annual fees assessed to other licensees, the 
small entity fees are not designed to recover the agency costs 
associated with particular licensees. Instead, the reduced fees for 
small entities are designed to provide some fee relief for 
qualifying small entity licensees while at the same time recovering 
from them some of the agency's costs for activities that benefit 
them. The costs not recovered from small entities for activities 
that benefit them must be recovered from other licensees. Given the 
reduction in annual fees from FY 2000 to FY 2005, on average, for 
those categories of materials licensees that contain a number of 
small entities, the NRC has determined that the current small entity 
fees of $500 and $2,300 continue to meet the objective of providing 
relief to many small entities while recovering from them some of the 
costs that benefit them.
    Therefore, the NRC proposed to retain the $2,300 small entity 
annual fee and the $500 lower tier small entity annual fee for FY 
2005. The NRC plans to re-examine the small entity fees again in FY 
2007.

IV. Summary

    The NRC has determined that the 10 CFR part 171 annual fees 
significantly impact a substantial number of small entities. A 
maximum fee for small entities strikes a balance between the 
requirement to recover 90 percent of the NRC budget and the 
requirement to consider means of reducing the impact of the fee on 
small entities. Based on its regulatory flexibility analysis, the 
NRC concludes that a maximum annual fee of $2,300 for small entities 
and a lower-tier small entity annual fee of $500 for small 
businesses and not-for-profit organizations with gross annual 
receipts of less than $350,000, small governmental jurisdictions 
with a population of less than 20,000, small manufacturing entities 
that have less than 35 employees, and educational institutions that 
are not State or publicly supported and have less than 35 employees 
reduces the impact on small entities. At the same time, these 
reduced annual fees are consistent with the objectives of OBRA-90. 
Thus, the fees for small entities maintain a balance between the 
objectives of OBRA-90 and the RFA. Therefore, the analysis and 
conclusions previously established remain valid for FY 2005.

Attachment 1 to Appendix A--U.S. Nuclear Regulatory Commission Small 
Entity Compliance Guide Fiscal Year 2005

Contents

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

Introduction

    The Small Business Regulatory Enforcement Fairness Act of 1996 
(SBREFA) requires all Federal agencies to prepare a written guide 
for each ``major'' final rule, as defined by the Act. The NRC's fee 
rule, published annually to comply with the Omnibus Budget 
Reconciliation Act of 1990 (OBRA-90), as amended, is considered a 
``major'' rule under SBREFA. Therefore, in compliance with the law, 
this guide has been prepared to assist NRC materials licensees in 
complying with the FY 2005 fee rule.
    Licensees may use this guide to determine whether they qualify 
as a small entity under NRC regulations and are eligible to pay 
reduced FY 2005 annual fees assessed under 10 CFR part 171. The NRC 
has established two tiers of annual fees for those materials 
licensees who qualify as small entities under the NRC's size 
standards.
    Licensees who meet the NRC's size standards for a small entity 
must submit a completed NRC Form 526 ``Certification of Small Entity 
Status for the Purposes of Annual Fees Imposed Under 10 CFR Part 
171'' to qualify for the reduced annual fee. This form can be 
accessed on the NRC's Web site at http://www.nrc.gov. The form can 
then be accessed by selecting ``License Fees'' and under ``Forms'' 
selecting NRC Form 526. For licensees who cannot access the NRC's 
Web site, NRC Form 526 may be obtained through the local point of 
contact listed in the NRC's ``Materials Annual Fee Billing 
Handbook,'' NUREG/BR-0238, which is enclosed with each annual fee 
billing. Alternatively, the form may be obtained by calling the fee 
staff at (301) 415-7554, or by e-mailing the fee staff at 
[email protected]. The completed form, the appropriate small entity fee, 
and the payment copy of the invoice should be mailed to the U.S. 
Nuclear Regulatory Commission, License Fee Team, at the address 
indicated on the invoice.
    Failure to file the NRC small entity certification Form 526 in a 
timely manner may result in the denial of any refund that might 
otherwise be due.

NRC Definition of Small Entity

    For purposes of compliance with its regulations (10 CFR 2.810), 
the NRC has defined a small entity as follows:
    (1) Small business--a for-profit concern that provides a 
service, or a concern that is not engaged in manufacturing, with 
average

[[Page 8702]]

gross receipts of $5 million or less over its last 3 completed 
fiscal years;
    (2) Manufacturing industry--a manufacturing concern with an 
average of 500 or fewer employees based on employment during each 
pay period for the preceding 12 calendar months;
    (3) Small organizations--a not-for-profit organization that is 
independently owned and operated and has annual gross receipts of $5 
million or less;
    (4) Small governmental jurisdiction--a government of a city, 
county, town, township, village, school district or special 
district, with a population of less than 50,000;
    (5) Small educational institution--an educational institution 
supported by a qualifying small governmental jurisdiction, or one 
that is not State or publicly supported and has 500 or fewer 
employees.\1\
---------------------------------------------------------------------------

    \1\ An educational institution referred to in the size standards 
is an entity whose primary function is education, whose programs are 
accredited by a nationally recognized accrediting agency or 
association, who is legally authorized to provide a program of 
organized instruction or study, who provides an educational program 
for which it awards academic degrees, and whose educational programs 
are available to the public.
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    To further assist licensees in determining if they qualify as a 
small entity, the following guidelines are provided, which are based 
on the Small Business Administration's regulations (13 CFR part 
121).
    (1) A small business concern is an independently owned and 
operated entity which is not considered dominant in its field of 
operations.
    (2) The number of employees means the total number of employees 
in the parent company, any subsidiaries and/or affiliates, including 
both foreign and domestic locations (i.e., not solely the number of 
employees working for the licensee or conducting NRC licensed 
activities for the company).
    (3) Gross annual receipts includes all revenue received or 
accrued from any source, including receipts of the parent company, 
any subsidiaries and/or affiliates, and account for both foreign and 
domestic locations. Receipts include all revenues from sales of 
products and services, interest, rent, fees, and commissions, from 
whatever sources derived (i.e., not solely receipts from NRC 
licensed activities).
    (4) A licensee who is a subsidiary of a large entity does not 
qualify as a small entity.

NRC Small Entity Fees

    In 10 CFR 171.16 (c), the NRC has established two tiers of fees 
for licensees that qualify as a small entity under the NRC's size 
standards. The fees are as follows:

------------------------------------------------------------------------
                                                              Maximum
                                                          annual fee per
                                                             licensed
                                                             category
------------------------------------------------------------------------
Small business not engaged in manufacturing and small
 not-for-profit organizations (Gross Annual Receipts):
    $350,000 to $5 million..............................          $2,300
    Less than $350,000..................................             500
Manufacturing entities that have an average of 500
 employees or less:
    35 to 500 employees.................................           2,300
    Less than 35 employees..............................             500
Small Governmental Jurisdictions (Including publicly
 supported educational institutions) (population):
    20,000 to 50,000....................................           2,300
    Less than 20,000....................................             500
Educational institutions that are not State or publicly
 supported, and have 500 Employees or less:
    35 to 500 employees.................................           2,300
    Less than 35 employees..............................             500
------------------------------------------------------------------------

    To pay a reduced annual fee, a licensee must use NRC Form 526. 
Licensees can access this form on the NRC's Web site at http://www.nrc.gov. The form can then be accessed by selecting ``License 
Fees'' and under ``Forms'' selecting NRC Form 526. Those licensees 
that qualify as a ``small entity'' under the NRC size standards at 
10 CFR 2.810 can complete the form in accordance with the 
instructions provided, and submit the completed form and the 
appropriate payment to the address provided on the invoice. For 
licensees who cannot access the NRC's Web site, NRC Form 526 may be 
obtained through the local point of contact listed in the NRC's 
``Materials Annual Fee Billing Handbook,'' NUREG/BR-0238, which is 
enclosed with each annual fee invoice. Alternatively, licensees may 
obtain the form by calling the fee staff at (301) 415-7554, or by e-
mailing us at [email protected].

Instructions for Completing NRC Small Entity Form 526

    (1) File a separate NRC Form 526 for each annual fee invoice 
received.
    (2) Complete all items on NRC Form 526, as follows:
    a. Enter the license number and invoice number exactly as they 
appear on the annual fee invoice.
    b. Enter the Standard Industrial Classification (SIC) or North 
American Industry Classification System (NAICS) if known.
    c. Enter the licensee's name and address as they appear on the 
invoice. Name and/or address changes for billing purposes must be 
annotated on the invoice. Correcting the name and/or address on NRC 
Form 526, or on the invoice does not constitute a request to amend 
the license. Any request to amend a license must be submitted to the 
respective licensing staff in the NRC's regional or headquarters 
offices.
    d. Check the appropriate size standard for which the licensee 
qualifies as a small entity. Check only one box. Note the following:
    (i) A licensee who is a subsidiary of a large entity does not 
qualify as a small entity.
    (ii) The size standards apply to the licensee, including all 
parent companies and affiliates--not the individual authorized users 
listed in the license or the particular segment of the organization 
that uses licensed material.
    (iii) Gross annual receipts means all revenue in whatever form 
received or accrued from whatever sources--not solely receipts from 
licensed activities. There are limited exceptions as set forth at 13 
CFR 121.104. These are: the term receipts excludes net capital gains 
or losses; taxes collected for and remitted to a taxing authority 
(if included in gross or total income), proceeds from the 
transactions between a concern and its domestic or foreign 
affiliates (if also excluded from gross or total income on a 
consolidated return filed with the IRS); and amounts collected for 
another entity by a travel agent, real estate agent, advertising 
agent, or conference management service provider.
    (iv) The owner of the entity, or an official empowered to act on 
behalf of the entity, must sign and date the small entity 
certification.
    The NRC sends invoices to its licensees for the full annual fee, 
even though some licensees qualify for reduced fees as small 
entities. Licensees who qualify as small entities and file NRC Form 
526, which certifies eligibility for small entity fees, may pay the 
reduced fee, which is either $2,300 or $500 for a full year, 
depending on the size of the entity, for each fee category shown on 
the invoice. Licensees granted a license during the first 6 months 
of the fiscal year, and licensees who file for termination or for a 
``possession only'' license and permanently cease licensed 
activities during the first 6 months of the fiscal year, pay only 50 
percent of the annual fee for that year. Such invoices state that 
the ``amount billed represents 50% proration.'' This means that the 
amount due from a small entity is not the prorated amount shown on 
the invoice, but rather one-half of the maximum annual fee shown on 
NRC Form 526 for the size standard under

[[Page 8703]]

which the licensee qualifies, resulting in a fee of either $1,150 or 
$250 for each fee category billed (instead of the full small entity 
annual fee of $2,300 or $500).
    Licensees must file a new small entity form (NRC Form 526) with 
the NRC each fiscal year to qualify for reduced fees in that year. 
Because a licensee's ``size,'' or the size standards, may change 
from year to year, the invoice reflects the full fee and licensees 
must complete and return form 526 for the fee to be reduced to the 
small entity fee amount. LICENSEES WILL NOT RECEIVE A NEW INVOICE 
FOR THE REDUCED AMOUNT. The completed NRC Form 526, the payment of 
the appropriate small entity fee, and the ``Payment Copy'' of the 
invoice should be mailed to the U.S. Nuclear Regulatory Commission, 
License Fee Team at the address indicated on the invoice.
    If you have questions regarding the NRC's annual fees, please 
contact the license fee staff at (301) 415-7554, e-mail the fee 
staff at [email protected], or write to the U.S. Nuclear Regulatory 
Commission, Washington, DC 20555-0001, Attention: Office of the 
Chief Financial Officer.
    False certification of small entity status could result in civil 
sanctions being imposed by the NRC under the Program Fraud Civil 
Remedies Act, 31 U.S.C. 3801 et seq. NRC's implementing regulations 
are found at 10 CFR part 13.

[FR Doc. 05-3128 Filed 2-18-05; 8:45 am]
BILLING CODE 7590-01-P