[Federal Register Volume 71, Number 103 (Tuesday, May 30, 2006)]
[Rules and Regulations]
[Pages 30722-30759]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 06-4815]



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Part II





Nuclear Regulatory Commission





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10 CFR Parts 170 and 171



Revision of Fee Schedules; Fee Recovery for FY 2006; Final Rule

  Federal Register / Vol. 71, No. 103 / Tuesday, May 30, 2006 / Rules 
and Regulations  

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NUCLEAR REGULATORY COMMISSION

10 CFR Parts 170 and 171

RIN 3150-AH83


Revision of Fee Schedules; Fee Recovery for FY 2006

AGENCY: Nuclear Regulatory Commission.

ACTION: Final rule.

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SUMMARY: The Nuclear Regulatory Commission (NRC) is amending the 
licensing, inspection, and annual fees charged to its applicants and 
licensees. The 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) 2006, less the amounts appropriated from the Nuclear 
Waste Fund (NWF) and for Waste Incidental to Reprocessing (WIR) 
activities. The required fee recovery amount for the FY 2006 budget is 
approximately $624 million, which is increased by approximately $0.9 
million to account for billing adjustments, resulting in a total of 
approximately $625 million that must be recovered through fees in FY 
2006.

DATES: Effective Date: July 31, 2006.

ADDRESSES: The comments received and the NRC's work papers that support 
these final changes to 10 CFR parts 170 and 171 are available 
electronically at the NRC's Public Electronic Reading Room on the 
Internet 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. For more information, contact the NRC Public 
Document Room (PDR) Reference staff at 1-800-397-4209, or 301-415-4737, 
or by e-mail to [email protected]. If you do not have access to ADAMS or if 
there are problems in accessing the documents located in ADAMS, contact 
the PDR.
    Comments received may also be viewed via the NRC's interactive 
rulemaking Web site (http://ruleforum.llnl.gov). This site provides the 
ability to upload comments as files (any format), if your web browser 
supports that function. For information about the interactive 
rulemaking site, contact Ms. Carol Gallagher, 301-415-5905; e-mail 
[email protected].
    For a period of 90 days after the effective date of this final 
rule, the work papers may also be examined at the NRC Public Document 
Room, Room O-1F22. One White Flint North, 11555 Rockville Pike, 
Rockville, MD 20852-2738. The PDR reproduction contractor will copy 
documents for a fee.

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. Response to Comments
III. Final Action
IV. Voluntary Consensus Standards
V. Environmental Impact: Categorical Exclusion
VI. Paperwork Reduction Act Statement
VII. Regulatory Analysis
VIII. Regulatory Flexibility Analysis
IX. Backfit Analysis
X. Small Business Regulatory Enforcement Fairness Act

I. Background

    For FYs 1991 through 2000, OBRA-90 (Pub. L. 101-508), 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 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 (Pub. L. 
106-377) 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 
was 90 percent in FY 2005. The FY 2006 Energy and Water Development 
Appropriations Act (EWDAA) (Pub. L. 109-103), as amended by the 
Department of Defense, Emergency Supplemental Appropriations to Address 
Hurricanes in the Gulf of Mexico, and Pandemic Influenza Act, 2006 
(Pub. L. 109-148), extended this 90 percent fee recovery requirement 
through FY 2006. As a result, the NRC is required to recover 
approximately 90 percent of its FY 2006 budget authority, less the 
amounts appropriated from the NWF and for WIR activities, through fees. 
The required fee recovery amount for the FY 2006 budget is 
approximately $624 million, which is increased by approximately $0.9 
million to account for billing adjustments, resulting in a total of 
approximately $625 million that must be recovered through fees in FY 
2006.
    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, as amended, recover generic and other regulatory costs not 
otherwise recovered through 10 CFR part 170 fees.
    The amount of the NRC's required fee collections are set by law and 
are therefore outside the scope of this rulemaking. In FY 2006, the 
NRC's total fee recoverable budget increased by $83.4 million from FY 
2005 in response to increased workload. As such, most annual fees 
increased. The budget, including the increases, was allocated to the 
fee classes that the budgeted activities support. As discussed in more 
detail below, another factor affecting the amount of annual fees for 
each fee class is the estimated collection under part 170.
    Additional factors will affect the NRC's required fee recovery in 
future years. For example, the Energy Policy Act of 2005 (Pub. L. 109-
58) permanently extends the 90 percent fee recovery requirement 
beginning in FY 2007. The Energy Policy Act also permanently removes 
certain homeland security activities from the fee base beginning in FY 
2007. Section 637 states that the NRC will not recover in fees:

    (iv) amounts appropriated to the Commission for homeland 
security activities of the Commission for the fiscal year, except 
for the costs of fingerprinting and background checks required by 
section 149 of the Atomic Energy Act of 1954 (42 U.S.C. 2169) and 
the costs of conducting security inspections.

    Under this legislative requirement, the budgeted resources for all 
generic homeland security activities (those activities that support an 
entire license fee class or classes of licensees, such as rulemakings, 
guidance development, and vulnerability assessments) will be removed 
from the fee base beginning with the FY 2007 fee rulemaking. Under the 
NRC's authority under the IOAA, the NRC will continue to bill under 
part 170 for all licensee-specific homeland security-related services 
provided, including security inspections and security plan reviews. 
This legislative

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change will provide fee relief for NRC licensees. However, the net 
change in annual fees in FY 2007 will also depend on other factors, 
especially the amount of the NRC's FY 2007 appropriated budget and the 
allocation of these resources to the license fee classes and surcharge 
categories (surcharge categories include the resources associated with 
activities for which the NRC does not charge fees, as described in more 
detail in Section III of this document), as well as any other policy 
decisions of the Commission.

II. Response to Comments

    The NRC published the FY 2006 proposed fee rule on February 10, 
2006 (71 FR 7350) to solicit public comment on its proposed revisions 
to 10 CFR parts 170 and 171. The NRC received three comments dated on 
or before the close of the comment period (March 13, 2006) and four 
additional comments thereafter, for a total of seven comments that were 
considered in this fee rulemaking. The comments have been grouped by 
issues and are addressed in a collective response.

A. Information Provided by NRC in Support of Proposed Rule

    Comment. Several commenters requested a more detailed explanation 
of significant fee increases. These comments requested that the NRC 
provide licensees and the public with a reasonably detailed listing of 
the major activities and their associated impact on the fees. These 
commenters expressed concern that the information provided to support 
the proposed rule was not adequate to allow for the full evaluation and 
comment on the proposed fee rule. While these comments acknowledged the 
availability of the work papers that provided information on the FY 
2006 budget, they requested NRC provide an itemized accounting of the 
major elements that comprise the annual assessment under part 171, 
including a detailed description of the major contracts currently 
outstanding. One set of comments set forth 26 specific questions on why 
budgeted resources increased from FY 2005 to FY 2006 in a number of 
areas. One comment stated that while the proposed rule stated that the 
FY 2006 included budget increases for new plant licensing and security, 
no information was available that would allow for the identification of 
the contribution of either security or new plant licensing toward the 
fee increase.
    These commenters further stated that industry's ability to evaluate 
the NRC's application of resources and priorities is impeded because 
the NRC allocated 70 percent of its recoverable budget to the generic 
assessment under part 171, while only 30 percent is recovered under the 
discrete fee provisions of part 170. One commenter stated that there 
was an expectation that generic fees would be reduced as new plant 
applications are filed and costs are charged directly to an applicant 
under part 170.
    Response. Consistent with the requirements of OBRA-90, as amended, 
the purpose of this rulemaking is to establish fees necessary to 
recover 90 percent of the NRC's FY 2006 budget authority, less the 
amounts appropriated from the NWF and for WIR activities, from 
applicants and the various classes of NRC licensees. As with each 
year's fee rulemaking, the FY 2006 proposed fee rule described the 
types of activities included in the proposed fees and explained how the 
fees were calculated to recover the budgeted costs for those 
activities. Additional summary calculations were provided in the FY 
2006 proposed fee rule: For each fee class, a table was presented 
showing the aggregate calculations (e.g., total budgeted resources and 
estimated part 170 collections). For each fee class, there was also a 
summary explanation provided for the changes in fees and budgeted 
resources.
    In addition to the information provided in the proposed rule, the 
supporting work papers were available for public examination in ADAMS 
and, during the 30-day comment period, in the NRC Public Document Room 
at One White Flint North, 11555 Rockville Pike, Rockville, MD. The work 
papers show the total budgeted full time equivalent (FTE) and contract 
budgeted resources at the planned activity level for all agency 
activities. These papers present an itemized accounting of all the 
budgeted resources included in the fees, at the lowest level of detail 
available agency-wide. The papers included extensive information 
detailing the allocation of the budgeted costs for each planned 
activity within each program to the various classes of licenses, as 
well as information on categories of budgeted costs included in the 
hourly rates.
    Also to assist commenters, the NRC made available NUREG-1100, 
Volume 21, ``Performance Budget: Fiscal Year 2006'' (February 2005), 
which discusses the NRC's budget for FY 2006, including the activities 
to be performed in each program. This document is available on the NRC 
public Web site at http://www.nrc.gov/reading-rm.html. The extensive 
information available provided the public with sufficient information 
on how NRC calculated the proposed fees. Additionally, the contact 
listed in the proposed fee rule was available during the public comment 
period to answer any questions that commenters had on the development 
of the proposed fees. Therefore, the NRC believes that ample 
information was available on which to base constructive comments on the 
proposed revisions to parts 170 and 171 and that its fee schedule 
development is a transparent process.
    In the FY 2006 proposed fee rule work papers, the NRC improved the 
organization of some of the reports to allow for increased 
transparency. For example, a separate document was created for each fee 
class and surcharge category to show the budget allocations for FY 2006 
and FY 2005 at the planned activity level, thereby making it easier to 
see the reasons for any fee changes between FY 2006 and FY 2005. 
Accordingly, the proposed rule showed the total value of budgeted 
resources allocated to a fee class and described the major reasons for 
any fee change(s), and the supporting work papers clearly set forth the 
changes in budgeted resources for each class at the planned activity 
level for both FTE and contract dollars. For example, the proposed fee 
rule stated that the power reactor annual fee increased due to an 
increase in budgeted resources for activities such as regulatory 
infrastructure for new reactor licensing activities (other examples 
were also provided). The work papers showed that the budgeted resources 
for that planned activity increased by approximately 42 FTE and $2.9 
million in FY 2006, as compared to FY 2005.
    In response to the comments with numerous detailed questions 
requesting information on why the budget increased for certain planned 
activities from FY 2005 to FY 2006, or requesting additional 
information on the use of resources under a specific planned activity, 
the NRC notes again that the purpose of this rulemaking is to establish 
fees to recover most of the NRC's budget, as required by OBRA-90, as 
amended. The NRC's budget and the manner in which the NRC carries out 
its activities are not within the scope of this rulemaking. The NRC's 
budget is submitted to the Office of Management and Budget (OMB) and 
Congress for review and approval. The Congressional budget process 
involves meetings, testimony, press briefings, etc. The 
Congressionally-approved budget resulting from this process reflects 
the resources deemed necessary for NRC to carry out its statutory 
obligations.
    The purpose of the FY 2006 fee rulemaking, as with prior year fee 
rulemakings, is to establish fees in a fair and transparent manner to 
recover the

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required portion of the NRC's budget. As such, the purpose of these 
rules is not to justify the use or need for current year budgeted 
resources, but to describe and take comment on the allocation of these 
resources for fee calculation and purposes. For example, the rule and 
supporting work papers are not intended to justify why the budgeted 
resources for a given planned activity increased by a particular 
percentage. (Note, however, the Performance Budget for each fiscal year 
does provide the objectives of the budget and how it supports the 
agency's Strategic Plan goals and strategies, and this justification is 
part of the Congressional approval and Executive Branch review 
process.) The rule and work papers show the value of the approved 
budgeted resources, and most importantly for fee calculation purposes, 
the fee classes and surcharge categories to which these resources are 
allocated. As mentioned previously, the work papers provide this 
information at the lowest level of detail available at the agency-
level, which is by planned activity.
    Regarding the comments that expressed concern that too much of the 
NRC's budget was designated for recovery under part 171, as discussed 
in previous fee rulemakings, the NRC is not at liberty to allocate fees 
indiscriminately between parts 170 and 171, because fee allocation is 
controlled by statute. The NRC assesses part 170 fees under the IOAA, 
consistent with implementing OMB Circular A-25, ``User Charges,'' to 
recover the costs incurred from each identifiable recipient for special 
benefits derived from Federal activities beyond those received by the 
general public. Generic costs that do not provide special benefits to 
identifiable recipients cannot be recovered under part 170. Further, 
the NRC notes that, as required by OBRA-90, as amended, the part 171 
annual fee recovery amounts are offset by the estimated part 170 fee 
collections. The NRC's work papers clearly set forth the components of 
these generic costs and how those costs are recovered through annual 
fees. Additionally, the NRC notes that it has taken action to maximize 
the amount recovered under part 170, consistent with existing law and 
agency policy. For example, in FY 1998 the NRC began charging part 170 
fees for all resident inspectors' time (63 FR 31840; June 10, 1998) and 
in FY 1999 the NRC started charging part 170 fees for all project 
manager activities associated with oversight of the assigned license or 
plant (64 FR 31448; June 10, 1999). In FY 2003, the NRC amended its 
regulations to allow the NRC to recover costs associated with contested 
hearings on licensing actions involving U.S. Government national 
security initiatives through part 170 fees assessed to the affected 
applicant or licensee (67 FR 64033; October 17, 2002). Included under 
this provision are activities involving the fabrication and use of 
mixed oxide fuel. Additionally, beginning with the FY 2005 fee rule (70 
FR 30526; May 26, 2005), the NRC revised its hourly rate calculation 
formula to better reflect actual agency costs, resulting in higher 
hourly rates. These higher hourly rates increased fee recovery under 
part 170.
    Similarly, in response to the comment that reactor generic fees 
should be reduced as new plant applications are filed and costs are 
charged directly to an applicant under part 170, the Commission notes 
that it recovers (and will continue to recover) the costs of all 
specific work relating to the review of new reactor or design 
applications and pre-application activities through part 170 fees. For 
example, the FY 1999 policy that established part 170 fee recovery for 
all project managers assigned to a license or plant, applies to project 
managers assigned to new reactor applications and pre-application 
reviews. All other specific activities for these reviews are also 
recovered through part 170 fees. This part 170 fee recovery reduces the 
amount of budgeted resources that must be recovered through annual fees 
to reactor licensees.

B. Specific Part 170 Issues

1. Hourly Fees
    Comment. Several commenters expressed concerns about the increases 
in the NRC's hourly rates associated with the proposed changes to 10 
CFR 170.20. These commenters noted that the increases exceeded the rate 
of inflation, and requested the NRC investigate ways to reduce the 
hourly fees.
    Response. The NRC's hourly rates are based on budgeted costs and 
must be established each year to meet the NRC's fee recovery 
requirements. As discussed in the proposed fee rule, the increases to 
the Nuclear Reactor Safety (Reactor) Program and Nuclear Materials and 
Waste Safety (Materials) Program rates are due to the recent 
Government-wide pay raise and the more accurate allocation of agency 
overhead to these programs and fee-exempt activities. The hourly rates 
are calculated to recover all of the budgeted costs supporting the 
services provided under part 170, including all programmatic and agency 
overhead, consistent with the full cost recovery concept emphasized in 
OMB's Circular A-25, ``User Charges.'' The NRC did not receive any 
comments on ways to revise the hourly rate calculation methodology, and 
notes that other comments, on this fee rulemaking and others, have 
consistently supported the NRC in its efforts to collect more of its 
budget through part 170 fees-for-services vs. part 171 annual fees. 
Therefore, the NRC is retaining the hourly rate formula as presented in 
the FY 2006 proposed fee rule. This results in hourly rates of $217 for 
the Reactor Program, and $214 for the Materials Program. The NRC 
recognizes that the higher hourly rates will have a greater impact on 
licensees that receive more part 170 services, but believes this is 
appropriate because the new rates more accurately reflect the costs of 
providing these services.
2. Invoice Information
    Comment. Several commenters stated that the Commission should 
continue its efforts to provide invoices that contain more meaningful 
descriptions of the work done by staff and especially contractors. 
These comments stated that in the private sector, adequate 
explanations, dates and times are provided to clients for clients to 
fully understand the work performed. One commenter stated that if the 
agency performs a large amount of work on a submittal from a single 
licensee, billings should be frequent so that a licensee is better able 
to track costs.
    Response. The NRC appreciates the comments on this topic, and 
believes that sufficient information is provided to licensees or 
applicants on which to base payment of invoices. The NRC's invoices for 
full-cost licensing actions and inspections contain details such as the 
type of service for which the costs are being billed, the name of the 
person or contractor performing the service, the date range the service 
was performed, the number of professional staff-hours expended in 
providing the service, the hourly rate, and the contractual costs 
incurred. These costs are billed quarterly, which the NRC believes is 
an adequate frequency to track and pay for these costs. Additionally, a 
licensee or applicant who does not understand the charges, or who would 
like more information to interpret the bill, may request additional 
information from the NRC regarding the specific bill in question. The 
NRC will provide all available data used to support the bill in 
response to this type of request.

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3. Part 170 Fees to Federal Agencies
    Comment. One commenter supported the Commission's proposal to 
charge Federal agencies for specific services provided by the NRC, 
agreeing that it is fair and appropriate to assess these fees to 
Federal agencies in the same manner as other NRC licensees.
    Response. The NRC appreciates the support for this proposal, and is 
enacting this policy change in this rulemaking, as described in more 
detail in Section III.A.3.

C. Specific Part 171 Issues

1. Annual Fees for Uranium Recovery Licensees
    Comment. The NRC received four comments objecting to the large 
increase in the annual fees for uranium recovery licensees. Some of 
these commenters expressed concerns that the FY 2006 proposed fee 
structure appears to unfairly discriminate against the uranium recovery 
section by imposing a 120 percent increase in annual fees, and 
requested that any required fee increase be similar to increases for 
other classes of licensees. Some commenters stated that there continues 
to be a lack of a reasonable relationship between the cost to uranium 
recovery licensees of NRC's regulatory program and the benefit derived 
from these services. Additionally, some commenters stated that the NRC 
needs to address the issue of decreasing numbers of uranium recovery 
licensees. Specifically, the concern was raised that as more states 
become Agreement States and/or additional sites are decommissioned, the 
number of NRC regulated sites continues to decline, leaving fewer 
licensees to pay a larger share of the NRC's regulatory costs.
    Some of these commenters acknowledged that the reallocation of 
existing FTE to uranium recovery licensing and inspection activities 
from other activities may be warranted, considering market forces and 
expected licensing activities. These commenters stated that fee 
increases might be more acceptable if they were accompanied by more 
timely licensing actions, but some commenters expressed concerns that 
there are still too few NRC staff on uranium recovery issues, and some 
of these staff are relatively new to the field. Some commenters also 
stated that the continued existence of remaining uranium recovery 
facilities is in the public interest given the renewed interest in 
nuclear power, and stated that large fee increases for these facilities 
is not in the public interest. These commenters noted a previous 
Commission comment which indicated the existence of a uranium recovery 
facility was in the public interest. One commenter noted that the 
increased fees and uncertainty of the timely review of licensing 
actions makes it difficult for licensees to manage costs, which could 
create a chilling effect on the development of new domestic uranium 
recovery facilities.
    Response. The NRC acknowledges that the FY 2006 uranium recovery 
annual fee of $65,900 is significantly higher than the annual fees 
charged to these facilities in FYs 2005 and 2004. (For FYs 2005 and 
2004, the NRC overestimated the part 170 collections it would receive 
from uranium recovery facilities, which resulted in lower part 171 
annual fees.) However, the FY 2006 uranium recovery annual fee amount 
is more similar to the annual fee amounts for FYs 2001 through 2003, 
when, for example, the annual fee for conventional mills ranged from 
approximately $53,000 to $111,000. Annual fees fluctuate from year to 
year based on a number of factors, including the budgeted resources for 
a license fee class. Additionally, because annual fees must recover all 
fee class resources not recovered through part 170 fees, annual fees 
are impacted by the part 170 fees collected from that fee class.
    As explained in the proposed rule, the higher FY 2006 annual fee 
for uranium recovery licensees reflects an increase in budgeted 
resources for this fee class. The NRC appreciates the acknowledgment 
that this budget change may be warranted to support uranium recovery 
licensees. In response to the concern about the NRC's staffing of 
uranium recovery issues and the timeliness of the review of licensing 
actions, these issues are outside the scope of this rulemaking. 
However, as noted in the FY 2005 final fee rule (70 FR 30526; May 26, 
2005), the NRC does consider market forces and expected future 
licensing activities in formulating its budget, and has a human 
resources program in place to address future agency skill needs.
    In response to concerns regarding decreasing numbers of NRC 
licensees in light of more states becoming Agreement States, the NRC 
notes the concerns that the ``last NRC licensee'' may have to pay for 
the cost of the entire uranium recovery program are unfounded because 
the NRC's fee calculation methodology considers the percentage of 
uranium recovery licensees in Agreement States in establishing fees for 
the uranium recovery fee class. As explained in the FY 2005 final fee 
rule, the budgeted resources providing support to Agreement States or 
their licensees are included in total surcharge costs, which are offset 
by non-fee recovery funding provided by Congress. For example, if the 
NRC develops a rule, guidance document, or database or other tracking 
system, that is associated with or otherwise benefits Agreement State 
licensees, the costs of these activities are prorated to the surcharge 
according to the percentage of licensees in that fee class in Agreement 
States (e.g., if 50 percent of uranium recovery licensees are in 
Agreement States, 50 percent of these regulatory infrastructure costs 
are included in the surcharge). Total surcharge costs are reduced by 
the fee relief (i.e., direct appropriations from the General Treasury) 
provided by Congress. To address fairness and equity concerns 
associated with licensees paying for the cost of activities that do not 
directly benefit them, as noted previously, the FY 2001 Energy and 
Water Development Appropriations Act amended OBRA-90 to decrease the 
NRC's fee recovery amount by two percent per year beginning in FY 2001, 
until the fee recovery amount was 90 percent in FY 2005. To the extent 
that this fee relief is insufficient to cover all surcharge costs, 
these remaining surcharge costs are spread to all licensees based on 
their percentage of the budget. (Note generic decommissioning costs for 
the materials program are also included in the surcharge.)
    In FY 2006, $3.5 million of the $72.8 million in total surcharge 
costs was not covered by the 10 percent fee relief, and therefore is 
included in licensees' annual fees. Eighty-four percent (the percentage 
of the budget associated with reactors) of the $3.5 million in net 
surcharge costs is included in reactor annual fees, and the remainder 
is spread to all other licensees' annual fees. Accordingly, NRC's 
uranium recovery licensees are not generally burdened with the costs of 
regulating Agreement State licensees or any other costs not associated 
with uranium recovery licensees (only to the extent that a small 
portion of these costs are spread to all licensees through the net 
surcharge). In FY 2006, the total surcharge cost allocated to the 
entire uranium recovery class is approximately $13,000. Because DOE is 
charged 50 percent of the total surcharge cost (as well as 50 percent 
of all generic resources associated with the uranium recovery fee 
class) for its UMTRCA Title I licensees, consistent with the 
methodology adopted in the FY 2002 final fee rule (67 FR 42612; June 
24, 2002), this leaves approximately $6,500 in total surcharge costs 
allocated

[[Page 30726]]

to NRC Title II program licensees that are subject to annual fees.
    This means about $1,300 of the $65,900 FY 2006 annual fee per 
uranium recovery license is attributable to activities that do not 
directly benefit these uranium recovery licensees. The remainder of the 
annual fee reflects the budgeted resources associated with the 
regulation of NRC's uranium recovery licensees, as shown in the 
detailed work papers made available to support the proposed rulemaking. 
As such, the NRC believes there is a strong relationship between the 
cost to uranium recovery licensees of NRC's regulatory program and the 
benefit derived from this program.
    The NRC acknowledges that license fee classes with fewer licensees 
are more impacted by changes to the budget and changes to part 170 
collections. The uranium recovery fee class was reduced by four 
licensees (two of which paid annual fees) in FY 2005 because regulatory 
responsibility for these licensees was transferred to the State of Utah 
in accordance with an Agreement under Section 274 of the Atomic Energy 
Act of 1954, as amended, effective August 16, 2004. There are currently 
six uranium recovery licensees, including a license for the DOE, paying 
for the generic and other regulatory costs associated with the 
regulation of the NRC's uranium recovery licensees. Because annual fees 
must recover budgeted resources for a fee class not recovered through 
part 170 fees, to the extent that part 170 fees do not completely 
recover the costs of budgeted resources for part 170 activities, these 
costs are included in annual fees. The fewer the licensees, the larger 
the impact this has on the annual fee per license. (Because these 
budgeted resources are for site-specific inspection and licensing 
activities, they are not prorated to the surcharge category of 
Agreement State Regulatory Support because the resources are budgeted 
for the purpose of supporting only NRC licensees.) The NRC does note 
that the increases to hourly rates enacted through this rulemaking will 
enable the agency to recover more of the budgeted resources for 
licensee-specific activities, and once implemented, will reduce costs 
that must be recovered through annual fees.
    In response to comments about the existence of uranium recovery 
facilities being in the public interest, and the potential economic 
consequences of fees on this industry, the NRC notes it has addressed 
similar comments in previous fee rulemakings. The NRC has stated since 
FY 1991, when the 100 percent fee recovery requirement was first 
implemented, that it recognizes the assessment of fees to recover the 
agency's costs may result in a substantial financial hardship for some 
licensees. However, consistent with the OBRA-90, as amended, 
requirement that annual fees must have, to the maximum extent 
practicable, a reasonable relationship to the cost of providing 
regulatory services, the NRC's annual fees for each class of licensee 
reflect the NRC's budgeted cost of its regulatory services to the 
class. The NRC determines the budgeted costs to be allocated to each 
class of licensee through a comprehensive review of every planned 
activity in each of the agency's major program areas. Furthermore, a 
reduction in the fees assessed to one class of licensees would require 
a corresponding increase in the fees assessed to other classes. 
Accordingly, the NRC has not based its annual fees on licensees' 
economic status, market conditions, or potential economic consequences. 
Instead, the NRC has only considered the impacts that it is required to 
address by law.
    While the NRC acknowledges the previous Commission comment about 
the existence of a uranium recovery facility being in the public 
interest, this does not negate the NRC's legal obligation to collect 
fees to recover the costs of regulating uranium recovery facilities.
2. Annual Fees for Fuel Facilities Licensees
    Comment. One commenter expressed concern over the increase in 
annual fees for fee category 2.A.1, UF6 conversion 
facilities. The commenter expressed concern that the fee increase was 
not explained in sufficient detail. In particular, the commenter did 
not believe the changes in the fuel facility fee matrix (i.e., the 
value of the effort factors for fee category 2.A.1) were explained in 
enough detail to allow for informed public comment. This commenter also 
stated that any fees for future 10 CFR part 40 or conversion facility 
rulemakings not be allocated to fee category 2.A.1.
    Response. The NRC established the methodology for calculating 
annual fees for individual fuel facilities through public notice and 
comment rulemaking (64 FR 31448; June 10, 1999), and the FY 2006 fee 
rulemaking uses this same methodology. This methodology establishes 
that the total budgeted resources for fuel facilities are allocated to 
individual fuel facility fee categories based on the effort/fee 
determination matrix. This methodology was also described in detail in 
the FY 2006 proposed fee rule. In addition, the publicly available work 
papers for the FY 2006 proposed rule provided detailed information on 
the FTE and contract resources for each planned activity that were 
allocated to the fuel facility fee class. The work papers also provided 
information on all the values of the effort factors used in the fuel 
facility matrix for FY 2006.
    As noted in the FY 2006 proposed fee rule, the NRC revised the 
effort factors for the UF6 conversion facility to better 
reflect the effort level associated with safeguards activities such as 
interim compensatory measures (ICMs). In response to the commenter's 
request for additional detailed information on the basis of the values 
of the effort factors, the NRC notes that before September 11, 2001, 
this UF6 conversion facility had a `0' for safeguards and 
security based on the fact that the facility had no security plan with 
the NRC. Shortly after September 11, 2001, NRC issued an Order to this 
facility requiring it to implement interim security upgrades. When the 
NRC performed security assessments and reviewed implementation of the 
ICMs in 2004, NRC determined (1) this UF6 conversion 
facility needed to maintain additional security measures as part of its 
baseline program, and (2) NRC needed to perform routine oversight of 
the security program including licensing review of security measures, 
inclusion of security measures in the license as part of license 
renewal, and routine inspection of security programs. Therefore, based 
on the new routine level of NRC effort for this facility, its score 
increased from `0' to `5' in the matrix used for the FY 2006 fee rule, 
which is `rebaselined' each year based on the most recent assessment by 
the program and technical experts responsible for the regulation of 
these facilities. Note that because of the timing of the fee rule each 
year, the fuel facility fee matrix represents a `snapshot' of expected 
effort levels at the beginning of the fiscal year. Therefore, a change 
in effort level that occurs after that `snapshot' may not be reflected 
until the next year.
    Finally, in response to the comment that any fees for future part 
40 or conversion facility rulemakings not be allocated to fee category 
2.A.1, the Commission notes that it approved the initiation of a part 
40 rulemaking on ground water protection at in situ leach uranium 
recovery facilities on March 24, 2006 (see Staff Requirements 
Memorandum--COMJSM-06-0001--Regulation of Groundwater Protection at In 
Situ Leach Uranium Extraction Facilities; ML060830525). (While this is 
a part 40 rulemaking, it relates to uranium recovery facilities, not 
UF6 or

[[Page 30727]]

other fuel facilities.) In the referenced Staff Requirements 
Memorandum, the Commission stated, ``The staff should plan on covering 
the costs of this rulemaking not through part 171 fees for existing 
uranium recovery licensees, but instead through the surcharge, which is 
assessed to all NRC licensees paying part 171 fees.'' As such, in the 
FY 2007 proposed fee rulemaking, the staff plans to propose to recover 
the costs of this rule through the surcharge. Note that the part 40 
rulemaking was not budgeted for in FY 2006, and therefore there is no 
adjustment to the FY 2006 fees to reflect the fee recovery of that 
rulemaking through the surcharge. Additionally, there were no other 
part 40 or conversion facility rulemakings budgeted for in FY 2006, and 
therefore, the FY 2006 annual fee for the UF6 conversion 
facility does not include any resources for these activities. The NRC 
will address the fee recovery of any other rulemakings that may be 
budgeted for in future years through its future year fee rulemakings.
3. Elimination of Fee Payment Exception for Uranium Recovery Licensees
    Comment. Several commenters requested that the quarterly payment 
provisions for uranium recovery remain in effect, and that the NRC not 
begin billing these licensees annually. One commenter stated that 
quarterly payments allow licensees to better allocate budgetary 
outlays.
    Response. While the NRC appreciates the concerns raised by the 
commenters, the NRC believes that there is insufficient justification 
for retaining the fee payment exception for Title II uranium recovery 
facilities, only. As discussed in the proposed rule, the NRC currently 
bills licensees' part 171 fees annually if their annual fees are less 
than $100,000, and quarterly if their annual fees are $100,000 or more. 
However, the NRC bills Class I and Class II uranium recovery licensees 
quarterly in accordance with Sec.  171.19(b), regardless of the amount 
of their annual fee. The NRC established this payment exception for 
Class I and Class II uranium recovery licensees in the FY 2001 final 
rule (66 FR 32452; June 14, 2001) because the annual fees for these 
licensees had been fluctuating just above or below $100,000. Since 
then, uranium recovery license fees have been well below $100,000. 
Because the basis of the existing exception is no longer a factor, as 
well as that the exception is administratively burdensome to implement 
with the current fee billing system, the NRC is eliminating this 
billing exception for Class I and Class II uranium recovery licensees.
    Additionally, the NRC notes that there are benefits to the annual 
payment of fees, which it believes further justify this change. This is 
because the annual payment of fees may provide for more notice of 
annual fee changes. When paying quarterly, the last quarterly payment 
of the current fiscal year's annual fee must be for the entire 
difference between that annual fee and the payments made in the first 
three quarters of that year. This payment is due as of the effective 
date of the final fee rule. When paying annually, licensees are billed 
on the anniversary month of the license. This payment practice, as 
established in the FY 1996 fee rule (61 FR 16203; April 12, 1996), 
means licensees know exactly when they will be billed each year and 
will know the exact fee amount in advance.

D. Other Issues

1. Recovery of Security Costs
    Comment. Some commenters objected to the NRC collecting security-
related costs from licensees, while acknowledging that Section 637 of 
the Energy Policy Act of 2005 will remove certain homeland security 
activities from the fee base beginning in FY 2007. One commenter 
mentioned that homeland security costs should be off the fee base 
beginning in FY 2006. Other commenters questioned whether the funds 
under the `Homeland Security Unallocated' planned activity in the 
proposed rule have been allocated to specific activities.
    Response. The NRC appreciates the concerns raised by commenters 
regarding homeland security costs being funded through license fees. As 
referenced previously, generic (i.e., not site-specific) homeland 
security budgeted resources will be removed from the fee base beginning 
in FY 2007, per the Energy Policy Act of 2005. However, these resources 
are on the fee base in FY 2006. Therefore, the fees established in this 
rulemaking include homeland security budgeted resources, consistent 
with OBRA-90, as amended.
    Regarding the question about the allocation of the `Homeland 
Security Unallocated' planned activity, the NRC has now allocated these 
resources to specific activities, and then to the fee classes and 
surcharge categories which these resources support. Specifically, the 
$4,498,000 under the `HLS Unallocated' planned activity in the proposed 
rule has been distributed as follows: (1) $808,000 to Nuclear Material 
Users/Homeland Security Information Technology, Control of Sources (for 
the Office of Nuclear Material Safety and Safeguards); (2) $420,000 to 
Management and Support Information Technology Compliance/Homeland 
Security Information Security (for the Office of Nuclear Security and 
Incident Response); (3) $420,000 to Reactor Licensing/Homeland Security 
Licensing/Homeland Security Mitigating Strategies (for the Office of 
Nuclear Regulatory Research); and (4) $2,850,000 to Reactor Licensing/
Licensing Tasks/Risk Informing the Regulatory Process (for the Office 
of Nuclear Regulatory Research).
    As shown in the work papers, the resources for item 1 have been 
allocated to the materials users fee class (and prorated to the 
surcharge categories of Agreement State Regulatory Support and 
Nonprofit Educational Institutions), and the resources for items 3 and 
4 have been allocated to the operating power reactor fee class. The 
resources for item 2 are treated as overhead, consistent with the 
treatment of other resources in the Management and Support Program. In 
the FY 2006 proposed fee rule, the resources associated with this 
planned activity were allocated to the fee classes in a manner 
consistent with how other homeland security resources were allocated.
2. NRC Budget
    Comment. Several commenters stated that NRC fees should reflect NRC 
efficiencies and provided suggestions for reducing NRC's budget and for 
more efficient/different use of NRC's resources. Some of these 
commenters addressed expenditures on homeland security, while others 
suggested more generally that NRC reduce expenditures, streamline 
processes, or otherwise perform activities more efficiently. Some 
commenters suggested that changes in NRC's regulatory approach, such as 
the reactor oversight process, should result in a reduced budget. Some 
commenters included suggestions to reallocate resources dedicated to 
the inspection of areas of plants that have little or no safety 
significance, to efforts to risk-inform regulations, license new 
reactor designs, and process combined operating licenses for new 
plants. A number of comments suggested that Memorandums of 
Understanding between the Commission and non-Agreement States regarding 
the regulation of in-situ well fields would help to reduce costs to 
licensees, as would the expansion of performance-based licensing and 
the increased use of Safety and Environmental Review Panels.

[[Page 30728]]

    Response. The NRC appreciates the importance of identifying and 
implementing process efficiencies on an ongoing basis. As discussed in 
previous fee rulemakings, NRC offices conduct process reviews every 
year and rely on risk-informed practices to develop cost-efficient 
budgets that will allow them to achieve the NRC's Strategic Plan 
mission objectives. Nonetheless, the NRC's budget and the manner in 
which the NRC carries out its activities are not within the scope of 
this rulemaking. Therefore, this final rule does not address the 
commenters' suggestions concerning the NRC's budget and the use of NRC 
resources. As discussed previously, the NRC's budget is submitted to 
OMB and Congress for review and approval. The Congressionally-approved 
budget resulting from this process reflects the resources deemed 
necessary for NRC to carry out its statutory obligations. In compliance 
with OBRA-90, as amended, the fees are established to recover the 
required percentage of the approved budget. The NRC will continue 
efforts to ensure that the NRC carries out its statutory obligations in 
an efficient manner.
3. Fees Predictability and Timing/Requested Fee Increase Phase-Ins or 
Caps
    Comment. Several commenters raised concerns that the timing of the 
issuance of the fee rule makes it difficult for licensees to plan for 
regulatory expenses within the framework of their normal budget cycles. 
One commenter specifically noted that because the NRC's fiscal year 
differs from the majority of licensees' fiscal years, and fee recovery 
is not known until after a new calendar year begins, the process forces 
licensees to estimate potential changes to the NRC fiscal year fee 
structure six to eight months in advance of the fee rulemaking. To 
address this issue, commenters suggested that the NRC publish an 
estimate of fees for the following year, coincident with issuance of 
the proposed fee rule each year. Some commenters recognized that while 
it would likely be impossible for the NRC to offer exact projections, 
the Commission should be able to develop reasonable estimates of the 
next year's fees. Some commenters suggested that the agency's projected 
total budget authority might be based on the five-year projection the 
Commission prepares as part of its annual budgeting process, and 
requested that this five-year projection be included in the Performance 
Budget each year (NUREG-1100 series). One commenter requested that the 
NRC's license fee estimates resulting from the anticipated FY 2007 
budget be estimated and communicated to the commenter, with some 
confidence, by June 2006. Other commenters requested that NRC consider 
deferring a portion of the annual fee increase to the first quarter of 
2007 to alleviate the unexpected burden imposed by large fee increases.
    Some commenters suggested the Commission revisit the issue of 
arbitrary fee caps or combining fee classes to lessen the impact of fee 
changes. Some commenters expressed concern with hourly fees increases, 
because total hourly fees are more unpredictable than annual fees and 
create a substantial amount of uncertainty in a given licensee's annual 
costs.
    Response. The NRC acknowledges the concerns raised by these 
commenters, and has addressed similar comments in previous fee 
rulemakings. However, the timing of the NRC's required fee collections 
is established by OBRA-90, as amended. In accordance with that statute, 
the NRC must collect the mandated level of fees by the end of the 
fiscal year to which they are attributed, in this case September 30, 
2006. As such, the agency does not have the discretion to delay the 
collection of these fees by deferring some fee increases.
    Additionally, the timing of the fee rule each year is contingent 
upon when the NRC receives its Congressionally approved budget. The 
Commission makes every effort to issue the proposed fee rule as soon as 
possible after receiving its appropriations. Because the NRC does not 
know in advance what its future budgets will be (i.e., proposed budgets 
must be submitted to the OMB for its review before the President 
submits the budget to Congress for enactment), the NRC believes it is 
not practicable to project fees based on future estimated budgets. For 
example, the FY 2006 budget appropriation for the NRC reflected a 
significant increase over the NRC's initial FY 2006 budget request 
because of an increase in workload for new reactor and certain security 
activities. Had the NRC proposed or established preliminary fees based 
on the FY 2006 budget request, these estimated fees would have been 
quite different from the fees ultimately assessed to licensees. The 
fees reflected in this rulemaking reflect the final approved 
appropriation that was signed by the President on December 30, 2005 
(Department of Defense, Emergency Supplemental Appropriations to 
Address Hurricanes in the Gulf of Mexico, and Pandemic Influenza Act, 
2006).
    Changes in economic markets, as well as the security and 
policymaking environments, make predicting the NRC's future budgets 
even more difficult than this was previously. However, even if the NRC 
were able to reasonably predict a future year total budget, the annual 
fee amounts are also highly sensitive to other factors, including the 
allocation of these budgeted resources to license fee classes, the 
numbers of licensees in a fee class, and the proportion of total class 
costs recovered from part 170. (Part 170 revenue from a fee class is 
particularly difficult to predict in advance, and more so for fee 
classes with small numbers of licensees, whose annual fees are even 
more sensitive to part 170 revenue estimates.) Estimating these factors 
even further in advance than the NRC currently does would likely lead 
to inaccurate future fee projections, which would be misleading to 
licensees.
    The NRC has previously considered requests to cap fee increases or 
phase them in over a longer period of time. In the FY 1999 proposed fee 
rule, the NRC solicited comments on the idea of a cap to fee increases 
(64 FR 15876; April 1, 1999). While some comments supported this 
proposal, others did not because they believed it would lead to some 
licensees subsidizing the costs of other licensees. The NRC did not 
adopt a fee increase cap in the FY 1999 final fee rule in light of 
fairness and equity concerns with this approach and a lack of 
overwhelming support from commenters (64 FR 31448; June 10, 1999). The 
NRC again considered these strategies in the FY 2005 fee rule and came 
to the same conclusion. The NRC continues to believe that the legal and 
fairness concerns with these fee cap strategies or other phase-in 
approaches outweigh the benefits of enhanced fee stability. Given the 
requirements of OBRA-90, as amended, to collect most of NRC's budget 
authority through fees, failure to fully recover costs from certain 
classes of licensees due to caps or thresholds would result in other 
classes of licensees bearing these costs. The NRC's fees are based on 
the current year budgeted costs of activities benefitting the 
associated license fee classes, and hence reflect the best assessment 
of who should be paying for these costs. However, the NRC will continue 
to strive to issue its fee regulations as early in the fiscal year as 
is practicable to give as much time as possible for licensees to plan 
for changes in fees.
    In response to the comment that hourly rate charges are even more 
difficult to predict than annual fees, the NRC notes that, if 
requested, the NRC

[[Page 30729]]

program staff will provide a best estimate of hours required to 
complete a specific licensing action, with the caveat that the actual 
hours expended may differ from that estimate based on certain 
circumstances (e.g., timeliness of submittals, quality of products 
submitted for review).

III. Final Action

    The NRC is amending its licensing, inspection, and annual fees to 
recover approximately 90 percent of its FY 2006 budget authority less 
the appropriations received from the NWF and for WIR activities. The 
NRC's total budget authority for FY 2006 is $741.5 million, of which 
approximately $45.7 million has been appropriated from the NWF, and 
$2.5 million for WIR activities. Based on the 90 percent fee recovery 
requirement, the NRC must recover approximately $624 million in FY 2006 
through part 170 licensing and inspection fees and part 171 annual 
fees. The amount required by law to be recovered through fees for FY 
2006 is $83.4 million more than the amount estimated for recovery in FY 
2005, an increase of over 15 percent.
    The FY 2006 fee recovery amount is increased by $0.9 million to 
account for billing adjustments (i.e., for FY 2006 invoices that the 
NRC estimates will not be paid during the fiscal year, less payments 
received in FY 2006 for FY 2005 invoices). There is no FY 2005 
carryover to apply to FY 2006 fee collections. This leaves 
approximately $625 million to be recovered in FY 2006 through part 170 
licensing and inspection fees and part 171 annual fees.
    The NRC estimates that approximately $183.3 million will be 
recovered in FY 2006 from part 170 fees. This represents an increase of 
19 percent as compared to the actual part 170 collections for FY 2005 
of $154.1 million. The NRC derived the FY 2006 estimate of part 170 fee 
collections based on the previous four quarters of billing data for 
each license fee class, with adjustments to account for changes in the 
NRC's FY 2006 budget, as appropriate, and the increase in the hourly 
rates from FY 2005 to FY 2006. The remaining $441.7 million will be 
recovered through the part 171 annual fees in FY 2006, compared to 
$380.5 million for FY 2005, an increase of approximately 16 percent.
    Table I summarizes the budget and fee recovery amounts for FY 2006 
(individual values may not sum to totals due to rounding).

          Table I.--Budget and Fee Recovery Amounts for FY 2006
                          [Dollars in millions]
------------------------------------------------------------------------
 
------------------------------------------------------------------------
Total Budget Authority..................................          $741.5
Less NWF and WIR........................................           -48.1
                                                         ---------------
    Balance.............................................           693.4
Fee Recovery Rate for FY 2006...........................         x 90.0%
                                                         ---------------
    Total Amount To Be Recovered for FY 2006............           624.0
Less Carryover from FY 2005.............................            -0.0
                                                         ---------------
Plus Part 171 Billing Adjustments:
    Unpaid FY 2006 Invoices (estimated).................             3.2
    Less Payments Received in FY 2006 for Prior Year                -2.3
     Invoices (estimated)...............................
                                                         ---------------
        Subtotal........................................             0.9
                                                         ===============
Amount to be Recovered Through Parts 170 and 171 Fees...           625.0
Less Estimated Part 170 Fees............................          -183.3
                                                         ===============
    Part 171 Fee Collections Required...................           441.7
------------------------------------------------------------------------

    The NRC has made four updates to the FY 2006 fee calculations since 
the proposed rule. First, the NRC updated the part 170 estimates based 
on the latest invoice data available. In total, the part 170 estimates 
decreased by approximately $5.4 million; approximately $3 million of 
this reduction is from the power reactor fee class. Second, the NRC has 
updated its allocation of the `Homeland Security Unallocated' planned 
activity, as described in Section II.D.1. This resulted in more 
budgeted resources allocated to the power reactor fee class, and less 
to fuel facilities and some other licensees in the Materials Program. 
Third, the NRC has adjusted downward the amount of generic 
transportation resources to be recovered from annual fees. This 
adjustment takes into account the annual fee collections received for 
transportation activities (fee categories 10.B.1 and 10.B.2 under Sec.  
171.16) until the effective date of the FY 2006 final fee rule, which 
decreased the required fee collections for most fee classes (see 
Section III.B.3.h for details). (Note that this is only a one-time 
adjustment because the 10.B.1 and 10.B.2 annual fees have been 
eliminated as of the effective date of this rule. Therefore, licensees 
should expect the value of these allocated transportation resources to 
increase in future years.) Fourth, the number of NRC materials users 
licensees has been updated to reflect the transfer of approximately 150 
licensees to the State of Minnesota. This adjustment was made because 
NRC entered into an Agreement with the State as authorized by Section 
274 of the Atomic Energy Act of 1954, as amended, effective March 31, 
2006. This resulted in a slight increase in fees for some materials 
users licensees because fewer NRC licensees are paying for budgeted 
licensing and inspection costs. Each of these changes and their 
associated impacts on each fee class is discussed in more detail in 
Section III.B.3.
    The net result of all these updates on the FY 2006 fees is small. 
Fees for most licensees remained the same between the FY 2006 proposed 
and final fee rules. The most significant change was a five percent 
increase in the test and research reactor annual fee, which resulted 
from a decrease in estimated part 170 fee collections for this fee 
class. Other fees increased or decreased by a small amount as a result 
of the changes listed in the preceding paragraph.
    The FY 2006 final fee rule is a ``major rule'' as defined by the 
Congressional Review Act of 1996. Therefore, the

[[Page 30730]]

NRC's fee schedules for FY 2006 will 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, major 
fuel cycle facilities, and other licensees with annual fees of $100,000 
or more, upon publication of the FY 2006 final rule. For these 
licensees, payment is due on the effective date of the FY 2006 rule. 
Because these licensees are billed quarterly, the payment due is the 
amount of the total FY 2006 annual fee less payments made in the first 
three quarters of the fiscal year. Those materials licensees whose 
license anniversary date during FY 2006 falls before the effective date 
of the final FY 2006 rule will be billed for the annual fee during the 
anniversary month of the license at the FY 2005 annual fee rate. Those 
materials licensees whose license anniversary date falls on or after 
the effective date of the final FY 2006 rule will be billed for the 
annual fee at the FY 2006 annual fee rate during the anniversary month 
of the license, and payment will be due on the date of the invoice.
    The NRC has discontinued mailing the final fee rule to all 
licensees as a cost saving measure, in accordance with its FY 1998 
announcement. Accordingly, the NRC does not plan to routinely mail the 
FY 2006 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]. 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, and will be permanently available 
at http://www.access.gpo.gov.
    The NRC is amending 10 CFR parts 170 and 171 as discussed in 
Sections A and B of this document.

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 establishing hourly rates to recover the full cost of 
activities under part 170, and to use these rates to calculate ``flat'' 
application fees. Additionally, this rule establishes that Federal 
agencies are subject to part 170 fees (with the exception of certain 
Federally-owned test and research reactors); clarifies that the 
tracking and monitoring of shipments necessary for certain licensing 
actions is subject to full cost fees under part 170; establishes 
additional import/export fee categories (subclasses); and makes minor 
administrative changes for purposes of clarification, consistency, and 
to eliminate redundancy.
    The NRC is making the following changes:
1. Hourly Rates
    The NRC is establishing in Sec.  170.20 two professional hourly 
rates for NRC staff time. These rates are based on the number of FY 
2006 direct program FTEs and the NRC's FY 2006 fee recoverable budget, 
excluding direct program support costs. These rates are used in 
assessing full cost fees for specific services provided, as well as 
flat fees for certain application reviews. The rate for the Reactor 
Program is $217 per hour. This rate is applicable to all activities for 
which fees are assessed under Sec.  170.21 of the fee regulations (with 
the exception of reactor decommissioning and import/export licensing 
activities). The rate for the Materials Program is $214 per hour. This 
rate is applicable to all activities for which fees are assessed under 
Sec.  170.31 of the fee regulations, as well as the reactor 
decommissioning and import/export activities under Sec.  170.21. In the 
FY 2005 final fee rule, the Reactor and Materials Program rates were 
$205 and $197, respectively.
    The increases to the Reactor and Materials Program rates from FY 
2006 to FY 2005 are due to the recent Government-wide pay raise and to 
the more accurate allocation of agency overhead to these Programs and 
fee-exempt activities. The hourly rate for the Materials Program 
decreased slightly (from $215 to $214) between the FY 2006 proposed and 
final rules because of some minor reductions in the allocation of 
resources to this program because of the revised allocation of 
resources under the `Homeland Security' planned activity (discussed in 
Section II.D.1).
    The hourly rate is derived by dividing the sum of budgeted 
resources for (1) Direct labor; (2) allocated program overhead; and (3) 
allocated agency overhead, by budgeted direct hours. This calculation 
is performed for both the Reactor and Materials Programs, and excludes 
the budgeted resources and associated overhead for fee exempt 
activities. The specific method used to determine the two professional 
hourly rates is as follows:
    a. Direct program budgeted FTE, as well as all associated program 
overhead (FTE and contracts), are allocated at the planned activity 
level to the fee classes and surcharge (i.e., fee exempt) categories 
based on who benefits from these activities. Direct contract support, 
which is the use of contract or other services in support of the line 
organization's mission-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 management and support budgeted resources (FTE and 
contracts), including resources associated with the Office of the 
Inspector General, are allocated to each fee class and surcharge 
category based on the percent of the total budgeted resources allocated 
to each fee class and surcharge category in step a.
    c. The hourly rate for the Reactor Program is calculated by 
dividing the total budgeted resources (calculated in steps a. and b.) 
allocated to the power reactor and test and research reactor fee 
classes by the direct hours allocated to those classes. Similarly, the 
hourly rate for the Materials Program is calculated by dividing the 
total budgeted resources allocated to the spent fuel/reactor 
decommissioning, fuel facility, transportation, materials users, 
uranium recovery, rare earth, and import/export fee classes by the 
direct hours allocated to those fee classes. Although an hourly rate 
for surcharge activities is not needed, the appropriate allocation of 
budgeted resources (including all associated overhead) and hours to the 
surcharge categories is calculated to ensure that these budgeted 
resources and hours are excluded from the Reactor and Materials Program 
hourly rates.
    The direct hours used in the denominator of this hourly rate 
calculation continue to be calculated based on an estimate of 1,446 
direct hours worked per direct FTE per year, as established in the FY 
2005 fee rule (70 FR 30526; May 26, 2005). As explained in the FY 2005 
fee rule, this estimate is based on data from the NRC's time and labor 
system. The NRC continues to believe this estimate appropriately 
reflects the direct time expended per direct FTE.
    Table II shows the results of this hourly rate calculation 
methodology. Due to rounding, adding the individual numbers in the 
table may result in a total that is slightly different than the one 
shown.

[[Page 30731]]



   Table II.--FY 2006 Budget Authority to Be Included in Hourly Rates
------------------------------------------------------------------------
                                              Reactor        Materials
                                              program         program
------------------------------------------------------------------------
Direct Program Salaries & Benefits......         $182.4M          $41.3M
Program Overhead Salaries & Benefits,              81.9M           17.8M
 and Contract Support...................
Allocated Agency Management and Support.          151.8M           34.0M
    Subtotal............................          416.1M           93.1M
Less Offsetting Receipts................           -0.1M           -0.0M
    Total Budget Included in Hourly Rate         $416.0M          $93.1M
Program Direct FTEs.....................         1,322.8           300.3
Professional Hourly Rate (Total Budget              $217            $214
 Included in Hourly Rate divided by
 Program Direct FTE times 1,446 hours)..
------------------------------------------------------------------------

    As shown in Table II, dividing the $416 million budgeted amount 
(rounded) included in the hourly rate for the Reactor Program by the 
Reactor Program direct hours (1,322.8 FTE times 1,446 hours) results in 
an hourly rate of $217 for the Reactor Program for FY 2006. Similarly, 
dividing the $93.1 million budgeted amount (rounded) included in the 
hourly rate for the Materials Program by the program direct hours 
(300.3 FTE times 1,446 hours) results in an hourly rate of $214 for the 
Materials Program in FY 2006. These hourly rates are rounded to the 
nearest whole dollar.
2. Fee Adjustments
    The NRC is adjusting the current part 170 fees in Sec. Sec.  170.21 
and 170.31 to reflect the changes in the hourly rates. The full cost 
fees assessed under Sec. Sec.  170.21 and 170.31 are based on the 
professional hourly rates and any direct program support (contractual 
services) costs expended by the NRC. Any professional hours expended on 
or after the effective date of the final rule will be assessed at the 
FY 2006 hourly rates.
    The fees in Sec. Sec.  170.21 and 170.31 that are based on the 
average time to review an application (flat fees) have been adjusted to 
reflect the change in the Materials Program professional hourly rate 
from FY 2005. The flat fees are calculated by multiplying the average 
professional staff hours needed to process the licensing actions by the 
Materials Program professional hourly rate for FY 2006. The agency 
estimates the average professional staff hours needed to process 
licensing actions every other year as part of its biennial review of 
fees performed in compliance with the Chief Financial Officers Act of 
1990 (Pub. L. 101-578). (This review was last performed as part of the 
FY 2005 fee rulemaking.) The amounts of the materials licensing flat 
fees are rounded so that the fees would be convenient to the user and 
the effects of rounding would be ``de minimis.'' 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.
    The licensing flat fees are applicable for fee categories K.1 
through K.5 of Sec.  170.21, and fee categories 1.C, 1.D, 2.B, 2.C, 3.A 
through 3.P, 4.B through 9.D, 10.B, 15.A through 15.R, 16, and 17 of 
Sec.  170.31. The higher hourly rate of $214 for the Materials Program 
is the reason for the increases in the licensing fees. Because the 
hourly rate decreased by one dollar between the FY 2006 proposed and 
final fee rules, some of the flat fees decreased by a small amount 
since the FY 2006 proposed fee rule. Applications filed on or after the 
effective date of the final rule will be subject to the revised fees in 
this rule.
3. Charging Part 170 Fees to Federal Agencies/Fees for Research 
Reactors
    The NRC is amending Sec. Sec.  170.11 and 170.31 to provide that 
part 170 fees will be assessed to Federal agencies where applicable. 
Under the Energy Policy Act of 2005 (Section 623), the NRC was granted 
authority to assess fees for specific services provided to any Federal 
government agency which applies to the NRC for, or is issued by the 
NRC, a license or certificate. The NRC currently recovers the costs of 
licensee-specific activities for non-Federal licensees, applicants, and 
certificate holders under part 170, but lacked the authority to assess 
these fees to Federal agencies (other than the Tennessee Valley 
Authority) until the effective date of the Energy Policy Act of 2005.
    Because activities such as processing license applications provide 
a specific benefit to the recipient, the Commission believes it is fair 
and appropriate to implement this new authority and thereby recover the 
costs of providing specific services to Federal agencies through part 
170 fees. The NRC has provided written notification to Federal agencies 
that have an NRC license or certificate that the NRC plans to implement 
this new authority in the FY 2006 final fee rule, so that they may 
include this cost in their budgets.
    The Commission notes that this provision of the Energy Policy Act 
of 2005 cannot legally be applied to services the NRC provides to 
Federal agencies that are not NRC licensees, certificate holders, or 
applicants. Therefore, the NRC will not charge part 170 fees to Federal 
agencies for activities that are not subject to NRC licensing. Examples 
of NRC activities not related to a license or certificate, and 
therefore not subject to part 170 fees, include those to support the 
DOE in its decommissioning of the West Valley site in New York, and 
technical assistance provided to the Department of Transportation for 
certain foreign approved transport package designs for import/export 
(for which NRC does not have regulatory authority).
    Under these changes to part 170, Federal agency licensees, 
certificate holders, and applicants will be assessed fees in the same 
manner as are non-Federal agency licensees, certificate holders, and 
applicants. This means that Federal agencies will be required to pay 
part 170 fees for NRC services provided, including reviews of 
applications and other licensing actions, inspections, and 
decommissioning activities. This change does not require the 
calculation of any new fee amounts or establishment of new fee 
categories for Federal agencies. The only exception is that the NRC is 
establishing a new flat application fee of $17,800 for fee category 17, 
``Master materials licenses of broad scope issued to Government 
agencies,'' under Sec.  170.31. There is currently no application fee 
listed for this fee category because the only licensees in this fee 
category are for the Federal government. The flat application fee 
established in this rule was calculated in the same manner as other 
flat application fees; it equals the product of the average hours 
estimated to process these types of applications and the Materials 
Program hourly rate.

[[Page 30732]]

Because of insufficient data on average processing times for these 
master materials licenses (there are only three such NRC licensees), 
the NRC based its estimate of average processing time for master 
materials licensees on other license applications of similar 
complexity.
    Additionally, to implement this new authority, the NRC is revising 
fee category 18.A under Sec.  170.31 to specify that full cost fees 
will be assessed for licensing and inspection activities associated 
with DOE's part 71 Certificates of Compliance.
    The NRC is exempting from part 170 fees Federally-owned test and 
research reactors that meet the fee exemption criteria set forth in 
Section 2903 of the Energy Policy Act of 1992 (Pub. L. 102-486). [These 
criteria relate to factors such as thermal power level and whether the 
reactor contains a liquid fuel loading, and are listed under both 
Sec. Sec.  170.11(a)(9) and 171.11(a)(2). Three Federally-owned 
research reactors currently meet this criteria (reactors at the 
Veteran's Administration Medical Center in Omaha, Nebraska, the U.S. 
Geological Survey in Denver, Colorado, and the Armed Forces 
Radiobiological Institute in Bethesda, Maryland)]. As implemented by 
Sec.  171.11(a)(2), Federally-owned test and research reactors that 
meet the statutory criteria are already exempt from paying annual fees. 
At the time Congress enacted this fee exemption, however, Federally-
owned reactors (other than the Tennessee Valley Authority) were not 
subject to part 170 fees. Therefore, the exemption criteria set forth 
in the Energy Policy Act of 1992 did not specifically address part 170 
fees. Now that NRC has the authority to charge part 170 fees to 
Federally-owned reactors, the NRC believes that it is appropriate as a 
matter of policy to apply the same criteria to Federally-owned test and 
research reactors, and exempt those meeting the criteria from part 170 
fees. State-owned reactors meeting this same criteria are currently 
exempt from part 170 fees under Sec.  170.11(a)(9). The Commission 
explained the rationale for this decision in the FY 1994 fee rule (59 
FR 36895; July 20, 1994) by stating that the NRC believed this was ``* 
* * consistent with the legislative intent of the Energy Policy Act of 
1992 that government-owned research reactors be exempt from fees if 
they meet the technical design criteria of the exemption and are used 
primarily for educational training and academic research purposes.'' 
The Commission continues to believe this is consistent with the intent 
of the Energy Policy Act of 1992, and therefore is exempting these 
Federally-owned reactors from part 170 fees.
    Note the NRC is clarifying that the fee exemption in Sec.  
170.11(a)(9) remains in effect even after the reactors meeting this 
criteria are no longer authorized to operate in the revision to that 
paragraph.
4. Charging Part 170 Fees for Tracking and Monitoring Shipments of 
Classified Matter
    The NRC is clarifying that full cost part 170 fees will be assessed 
to track and monitor shipments of classified materials (e.g., 
components of gas centrifuge uranium enrichment facilities). The NRC 
currently has under review applications to build and operate gas 
centrifuge uranium enrichment facilities. Because of the sensitive 
technology, many of the components associated with these facilities are 
classified as Restricted Data under the Atomic Energy Act of 1954 (Pub. 
L. 83-703), as amended. Furthermore, some of these components are 
voluminous and cannot be transported under the standard classified 
matter transportation requirements of Sec.  95.39(b) and (c) (e.g., 
double wrapping, marking, and tracking). In these cases, the NRC 
requires the licensee or applicant to submit a security plan under 
Sec.  95.39(e) for transporting this non-standard classified matter. 
One aspect of classified matter transportation security plans is 
continuous telemetric position monitoring and tracking of shipments of 
classified matter, including a capability for notification of local law 
enforcement officials and the NRC in the case of an emergency.
    Because of the inherent national security concerns associated with 
the transportation of Restricted Data components and the current threat 
environment, the NRC has not considered permitting licensees to 
establish their own telemetric position monitoring and tracking 
capability for shipments of classified matter, nor to contract with a 
commercial service to meet this requirement. Instead, the NRC intends 
to require that these shipments be tracked and monitored by a U.S. 
government owned or operated system (e.g., systems operated by the U.S. 
Departments of Defense or Energy). As such, the NRC is establishing an 
interagency agreement and memorandum of understanding and reimbursable 
agreement with another government agency to provide the necessary 
tracking, monitoring, and communications center capabilities. 
Accordingly, the costs incurred by the NRC from this other government 
agency in monitoring these shipments will be passed on to the 
applicable licensee in full. While this is a new activity, the recovery 
of these costs through part 170 fees is consistent with the NRC's 
existing full cost recovery policy for licensing activities.
    The NRC is making this clarification by modifying the definition of 
``special projects'' in Sec.  170.3 to include this type of activity. 
This definition currently includes examples of special projects. 
Including this activity as an example would ensure that licensees are 
informed that these activities are subject to part 170 fees.
5. Revisions To Import/Export Fee Categories
    The NRC is modifying the import and export fee categories at Sec.  
170.31 to reflect revisions to 10 CFR part 110 that were published on 
July 1, 2005 (70 FR 37985), effective December 28, 2005. These part 110 
revisions take into account provisions in the International Atomic 
Energy Agency (IAEA) Code of Conduct on the Safety and Security of 
Radioactive Sources concerning the import and export of radioactive 
sources, and the supplemental IAEA guidance on the Import and Export of 
Radioactive Sources.
    The specific radioactive material and quantities newly covered by 
NRC regulations, per the July 1, 2005 revisions, are listed in Table 1 
of Appendix P to part 110, and are essentially identical to the list of 
radioactive materials in Category 1 and Category 2 of the Code of 
Conduct. The amendments to part 110 require NRC authorization of 
certain exports and imports by specific license. As a result of these 
changes, it is necessary to add additional import/export fee categories 
under Sec.  170.31 to accommodate these new types of licensees.
    Therefore, the NRC is modifying fee category 15 at Sec.  170.31 to 
include separate fee categories for Category 1 Exports (fee categories 
15.F through 15.I), Category 2 Exports (fee categories 15.J through 
15.L), Category 1 Imports (fee categories 15.M and 15.N), Category 2 
Imports (fee category O), Category 1 Imports with Agent and Multiple 
Licensees (fee categories 15.P and 15.Q), and minor amendments to 
Category 1 and 2 Exports and Imports (fee category 15.R). As with other 
flat fees established under Sec.  170.31, the fees associated with each 
fee category reflect the NRC's estimate of average hours required to 
process the license application, multiplied by the hourly rate. These 
changes also establish that for a combined import and export license 
application for material listed in Appendix P to part 110, only the 
higher

[[Page 30733]]

of the two applicable fee amounts must be paid. This is because the 
difference in level of effort associated with processing a combined 
import and export license versus processing just the export license 
(for the material listed in Appendix P to part 110, only) is 
negligible.
6. Administrative Amendments
    The NRC is eliminating the reference to ``route approvals for 
shipment of radioactive materials'' in the definition of ``special 
projects'' under Sec.  170.3. This activity is currently covered under 
Sec.  170.31, fee category 10 C., which establishes full cost recovery 
for this and other related activities; therefore, the additional 
reference to this activity as a special project (for which the NRC 
assesses full cost fees) is redundant.
    The NRC is also modifying Sec.  170.11(a)(4) to clarify that the 
fee exemption does not apply if an institution meets at least one of 
the criteria listed in Sec.  170.11(a)(4)(i)-(iv). Currently, these 
criteria are connected with an ``and,'' rather than an ``or,'' making 
it unclear whether the fee exemption in Sec.  170.11(a)(4) applies to 
an institution that meets one of the criteria. This revised language is 
consistent with the language used for this same exemption as applied to 
part 171 fees under Sec.  171.11(a)(1) and will enhance the clarity of 
this provision.
    Additionally, the NRC is clarifying which hourly rate is applicable 
to which activities. Currently, Sec.  170.20 states that the Reactor 
Program rate is applicable to Sec.  170.21 activities, and the 
Materials Program rate is applicable to Sec.  170.31 activities. The 
NRC is amending Sec.  170.20 to clarify that (1) the Reactor Program 
hourly rate is applicable to all activities for which fees are assessed 
under Sec.  170.21 of the fee regulations, with the exception of 
reactor decommissioning and import/export licensing activities, and (2) 
the Materials Program rate is applicable to all activities for which 
fees are assessed under Sec.  170.31 of the fee regulations, as well as 
the reactor decommissioning and import/export activities under Sec.  
170.21. This change better aligns the applicable hourly rate with the 
data used to calculate that rate (i.e., reactor decommissioning 
resources are included in the Materials Program hourly rate).
    Finally, the NRC is creating a new fee category under Sec.  170.31, 
which would effectively split the current fee category 1.A.2.b 
(``other'' fuel facilities) into two categories, one for gas centrifuge 
enrichment demonstration facilities and one for hot cell facilities. 
This change keeps the fee categories under parts 170 and 171 
consistent, in light of the same change the NRC made to Sec.  171.16. 
This change does not affect part 170 fee recovery requirements, as each 
category is subject to full cost part 170 fees where applicable. This 
change results in different annual fees for the existing fee category 
1.A.2.b and the new fee category 1.A.2.c, as explained in more detail 
under Section III.B.3.a of this document.
    In summary, the NRC is making the following changes to 10 CFR part 
170--
    1. Establishing revised Reactor and Materials Program hourly rates;
    2. Revising the licensing fees to be assessed to reflect the 
Reactor and Materials Program hourly rates;
    3. Amending Sec. Sec.  170.11 and 170.31 to provide that part 170 
fees will be assessed to Federal agencies where applicable (except for 
certain Federally-owned research reactors);
    4. Revising Sec.  170.3 to clarify that full cost part 170 fees 
will be assessed to track and monitor shipments of classified matter;
    5. Modifying the import and export fee categories under Sec.  
170.31; and
    6. Making minor administrative changes for purposes of 
clarification, consistency, and to eliminate redundancy.

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 is making the following changes under part 171: Proceeding 
with a presumption in favor of rebaselining annual fees beginning with 
the final FY 2006 rule; recovering generic transportation costs as part 
of other existing annual fees; revising the annual fees for FY 2006 to 
reflect the FY 2006 budget, changes in the number of NRC licensees, and 
the division of an existing fuel facilities fee category into two 
categories; eliminating the existing fee payment method exception for 
Class I and Class II uranium recovery licensees; and making an 
administrative change to clarify the definition of ``overhead and 
general and administrative costs.'' The amendments are described below.
1. Rebaselining Annual Fees
    The NRC uses one of two methods to determine the amounts of the 
annual fees established in its fee rule each year. One method is 
``rebaselining,'' for which the NRC's budget is analyzed in detail and 
budgeted resources are allocated to fee classes and categories of 
licensees. The second method is the ``percent change'' method, for 
which fees are revised based on the percent change in the total budget, 
taking into account other adjustments, such as the number of licensees 
and the projected revenue to be received from part 170 fees.
    The NRC is establishing rebaselined annual fees for FY 2006, and is 
proceeding with a presumption in favor of rebaselining when determining 
annual fees for FY 2007 and beyond. The Commission's previous policy 
regarding the method of calculating annual fees, made in the statement 
of consideration of the FY 1995 fee rule (60 FR 32218; June 20, 1995), 
and further explained in the statement of consideration of the FY 1999 
fee rule (64 FR 31448; June 10, 1999), was that annual fees would be 
rebaselined at least every third year, and more frequently if there was 
a substantial change in the total NRC budget or in the magnitude of the 
budget allocated to a specific class of licensees. The NRC is 
establishing a presumption in favor of rebaselining beginning with the 
FY 2006 rulemaking because (1) rebaselining is usually appropriate 
since there is often a substantial change in the total NRC budget or in 
the magnitude of the budget allocated to a specific class of licensees, 
and (2) delaying rebaselining can result in larger fee changes in the 
years when fees are rebaselined. The use of the percent change method 
will remain an option should there be a year in which there are no 
significant changes to the total budget or individual programs for fee 
classes. The NRC expects that in most years, annual fees will be 
rebaselined.
    Until FY 1996, annual fees were determined using the rebaselining 
method. In an effort to stabilize fees, the NRC decided to adjust 
annual fees using the percent change method beginning in FY 1996, 
unless there was a substantial change in the NRC budget or in the 
magnitude of a specific budget allocation to a class of licensees. Fees 
were determined using the percent change method in the FYs 1996-1998 
fee rules.
    The NRC rebaselined fees in the FY 1999 fee rule, and solicited 
comment on the use and frequency of the percent change method. Some 
commenters, such as the Nuclear Energy Institute, supported 
rebaselining every year, believing that this method best supports the 
accurate alignment of costs to fee classes and the in-depth review 
needed to maximize agency efficiency. Other commenters appreciated the 
fee stability provided by the percent change method.

[[Page 30734]]

In response to these comments, the Commission determined that annual 
fees should be rebaselined every three years, or 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. 
Fees were calculated using the percent change method in FY 2000, and 
were rebaselined in FYs 2001-2005.
    As mentioned previously, the NRC believes that it should proceed, 
in future rulemakings, with a presumption in favor of rebaselining 
because there is often a substantial change in the total NRC budget or 
in the magnitude of the budget allocated to a specific class of 
licensees. Changes occurring in FY 2006 and beyond that warrant a 
rebaselining of fees include those in the areas of new reactor 
licensing, homeland security (including the removal of certain homeland 
security costs from the fee base beginning in FY 2007, per the Energy 
Policy Act of 2005), and new regulatory authority for naturally 
occurring and accelerator produced radioactive material. Accordingly, 
the Commission has concluded that the percent change method should be 
used infrequently, and therefore, is proceeding with a presumption in 
favor of rebaselining each year beginning with this fee rule.
2. Recovering Generic Transportation Costs as Part of Other Existing 
Annual Fees
    The NRC is establishing that generic transportation costs unrelated 
to DOE be recovered as part of existing annual fees for license fee 
classes, rather than through a separate annual fee for part 71 Quality 
Assurance (QA) program approval holders (as is the current practice). 
Under this change, the annual fee for fee categories 10.B.1 and 10.B.2 
under Sec.  171.16 will be eliminated. However, the NRC is not changing 
or eliminating the annual fee under Sec.  171.16, fee category 18.A, 
for DOE transportation activities, which will continue to be calculated 
using the current methodology (described further under Section 
III.B.3.h of this document). This change will enhance the equity of 
NRC's fees, increase the consistency of 10 CFR parts 71 and 72 fee 
recovery, and decrease the administrative burden associated with a 
separate transportation annual fee.
    All NRC licensees must perform some activities related to the 
transportation of radioactive material as a necessary part of their 
licensed activities. This transportation is authorized by their NRC 
license (under 10 CFR parts 30, 40, 50, 70, etc.). [10 CFR 71.17 
establishes a general license that authorizes NRC licensees to make 
shipments using packages with an approved Certificate of Compliance 
(CoC), without further approval.] For example, all licensees receive 
licensed material at their site, and ship products and waste materials. 
Because the NRC does not issue separate licenses under part 71 for 
transportation activities, the NRC currently recovers the cost of all 
``generic'' transportation activities (i.e., those activities that are 
not licensee-specific, and therefore not recovered through part 170 
fees) through annual fees for QA program approvals. QA program 
approvals are required for entities holding NRC approved CoCs for 
transportation packages and for licensees that ship large (Type B) 
quantities of radioactive material or fissile material. NRC licensees 
must also use an approved CoC to transport radioactive material.
    The NRC currently charges annual fees for the two types of QA 
program approvals it issues: (1) Use (approximately 80 programs), and 
(2) use and fabrication (approximately 40 programs). However, the 
resources for generic transportation activities-- which are recovered 
through these two annual fees--support many other transportation-
related NRC approvals and services, including the issuance of CoCs, 
route approvals, and evaluations of transportation devices and security 
plans. (The NRC charges part 170 fees for these specific services, not 
annual fees, for various reasons.)
    One reason this approach raises fairness concerns is that a company 
is required to have only one QA program approval regardless of the 
number of CoCs it holds. This means companies pay the same annual fee 
regardless of whether they own one or many CoCs. As industry 
consolidation has increased over the past decade and the NRC has issued 
fewer QA program approvals, this equity concern has increased.
    The NRC believes generic transportation resources would be 
recovered more equitably if these costs were included in the existing 
annual fees for NRC licenses for 10 CFR parts 30, 40, 50, 70, etc. The 
resources associated with generic transportation activities would be 
distributed to the license fee classes based on the number of CoCs 
benefitting (used by) that fee class, as a proxy for the generic 
transportation resources expended for each fee class. (This is a method 
similar to that used to calculate DOE's annual fee for transportation 
activities under Sec.  171.16 fee category 18.A.) In this way, the 
annual fee for a license would include the estimated share of 
transportation resources needed to support that license, similar to the 
recovery of other types of generic resources such as rulemakings and 
risk assessments. Note that the amount of generic transportation 
resources distributed to the fee classes does not include the cost of 
activities associated with fee-exempt entities (e.g., nonprofit 
educational institutions). Additionally, the distribution of these 
resources to the fee classes is adjusted to account for the licensees 
in each fee class that are fee exempt. [For example, if two CoCs 
benefit the entire test and research reactor class, but only four of 31 
test and research reactors are subject to annual fees, the number of 
CoCs used to determine the proportion of generic transportation 
resources allocated to test and research reactor annual fees equals 
((4/31)*2), or 0.26 CoCs.]
    Under this new approach, reactors pay approximately 38 percent of 
these costs in FY 2006, materials users approximately 32 percent, fuel 
facilities approximately 21 percent, spent fuel/reactor decommissioning 
licensees approximately nine percent, and test and research reactors 
approximately 0.3 percent.
    This new approach will also increase the consistency of parts 71 
and 72 fee recovery. Part 72 QA programs are approved as part of the 
CoC approval process, and an annual fee is not assessed for either this 
QA approval or the CoC. The generic costs associated with spent fuel 
storage are recovered as part of the annual fee assessed to operating 
power reactors, decommissioning power reactors, and independent spent 
fuel storage installation licensees who do not hold a part 50 license.
    Finally, an additional benefit of this approach is that it will 
decrease administrative burden and costs for both NRC and licensees by 
eliminating a required systems interface for NRC fee billing purposes, 
as well as reduce the number of NRC bills and accounts receivable 
transactions.
3. Revised Annual Fees
    The annual fees in Sec. Sec.  171.15 and 171.16 are revised for FY 
2006 to recover approximately 90 percent of the NRC's FY 2006 budget 
authority, less the estimated amount to be recovered through part 170 
fees and the amounts appropriated from the NWF and for WIR activities. 
The total amount to be recovered through annual fees for FY 2006 is 
$441.7 million, compared to $380.5 million for FY 2005.
    Rebaselining fees in FY 2006 results in increased annual fees 
compared to FY 2005 for all licensees except certain fuel facilities. 
The increases in annual fees range from four percent for certain

[[Page 30735]]

sealed source safety devices to approximately 118 percent for uranium 
recovery facilities. However, most of the annual fee increases are of 
similar magnitude to the percentage increase in total required fee 
recovery of approximately 15 percent. The annual fee for certain 
medical licensees (fee category 7C) and industrial users of nuclear 
material (fee category 3P), which are the two fee categories with the 
largest number of licensees (with a combined total of over 3,200 of the 
NRC's approximately 4,400 billable materials users licensees), 
increased by approximately 18 percent and 16 percent, respectively.
    As mentioned previously, the most significant factor affecting the 
changes to the annual fee amounts is the increase in the NRC's fee 
recoverable budget in FY 2006. The NRC's fee recoverable budget, as 
mandated by law, is $83.4 million larger in FY 2006 as compared to FY 
2005, an increase of over 15 percent. Much of this increase is for the 
additional workload demand in areas such as new plant licensing and 
security. Other factors include adjustments in the distribution of 
budgeted costs to the different classes of licenses (based on the 
specific activities NRC will perform in FY 2006) and the estimated part 
170 collections for the various classes of licenses. The percentage of 
the NRC's budget not subject to fee recovery remained unchanged at ten 
percent from FY 2005 to FY 2006.
    Note that the NRC's total estimated part 170 fee collections 
increased by nineteen percent in FY 2006 (compared to FY 2005 actual 
part 170 collections). This increase is mainly due to the increase in 
the FY 2005 hourly rates as compared to the FY 2004 hourly rates. As 
discussed in the FY 2005 rulemaking, the higher hourly rates 
established in FY 2005 increased part 170 fee collections beginning in 
FY 2006. (These rates took effect near the end of FY 2005, and the NRC 
began collecting receipts from these higher rates as of the beginning 
of FY 2006.) Because costs not recovered under part 170 are recovered 
through part 171 annual fees, an increase in total part 170 fee 
collections results in a reduction in total annual fees by the same 
amount. Because of the higher hourly rates and resulting higher part 
170 fee collections in FY 2006, the FY 2006 annual fees are lower than 
they would have been had NRC not established higher hourly rates in FY 
2005.
    As mentioned previously, the NRC has made four updates to the FY 
2006 fee calculations since the proposed rule, and these adjustments 
affected the annual fee estimates in this rule. First, the NRC updated 
the part 170 estimates based on the latest invoice data available. (The 
part 170 estimates decreased somewhat for most fee classes, and 
remained the same for two.) Second, the NRC has updated its allocation 
of the ``Homeland Security Unallocated''planned activity, as described 
in Section II.D.1. Third, the NRC has adjusted downward the amount of 
generic transportation resources to be recovered from annual fees to 
take into account the annual fee collections received for 
transportation activities (fee categories 10.B.1 and 10.B.2 under Sec.  
171.16) until the effective date of the FY 2006 final fee rule. (Note 
that this is only a one-time adjustment because the 10.B.1 and 10.B.2 
annual fees have been eliminated as of the effective date of this rule; 
therefore, licensees should expect the value of these allocated 
transportation resources to increase in future years.) Fourth, the 
number of NRC materials users licensees has been updated to reflect the 
transfer of approximately 150 licensees to the State of Minnesota. The 
net impact of these updates is that annual fees for most licensees 
either decreased slightly or remained the same since the proposed rule, 
but some did increase by a small amount. Each of these changes and 
their associated impacts on each fee class is discussed in more detail 
in Section III.B.3.a-.
    Table III shows the rebaselined annual fees for FY 2006 for a 
representative list of categories of licenses. The FY 2005 fee is also 
shown for comparative purposes.

             Table III.--Rebaselined Annual Fees for FY 2006
------------------------------------------------------------------------
                                              FY 2005         FY 2006
       Class/category of licenses           annual fee      annual fee
------------------------------------------------------------------------
Operating Power Reactors (including           $3,155,000      $3,704,000
 Spent Fuel Storage/Reactor
 Decommissioning annual fee)............
Spent Fuel Storage/Reactor                       159,000         173,000
 Decommissioning........................
Test and Research Reactors (Non-power             59,500          80,100
 Reactors)..............................
High Enriched Uranium Fuel Facility.....       5,449,000       5,420,000
Low Enriched Uranium Fuel Facility......       1,632,000       1,596,000
UF6 Conversion Facility.................         699,000       1,046,000
Conventional Mills......................          30,200          65,900
Typical Materials Users:
    Radiographers.......................          12,800          15,400
    Well Loggers........................           4,100           4,800
    Gauge Users (Category 3P)...........           2,500           2,900
    Broad Scope Medical.................          27,300          33,000
------------------------------------------------------------------------

    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 2006 EWDAA, which amended OBRA-90 (as amended) to 
require that the NRC recover 90 percent of its budget in FY 2006, the 
total surcharge costs for FY 2006 will be reduced by approximately 
$69.3 million. The total FY 2006 budgeted costs for these activities 
and the reduction in the total surcharge amount for fee recovery 
purposes are shown in Table IV (individual values may not sum to totals 
due to rounding).

[[Page 30736]]



                       Table IV.--Surcharge Costs
                          [Dollars in millions]
------------------------------------------------------------------------
                                                              FY 2006
                    Category of costs                     budgeted costs
------------------------------------------------------------------------
1. Activities not attributable to an existing NRC
 licensee or class of licensee:
    a. International activities.........................           $13.8
    b. Agreement State oversight........................             8.0
    c. Activities for unlicensed sites (includes                     5.4
     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                      11.9
     institutions.......................................
    b. Licensing and inspection activities associated                1.4
     with other Federal agencies........................
    c. Costs not recovered from small entities under 10              5.7
     CFR 171.16(c)......................................
3. Activities supporting NRC operating licensees and
 others:
    a. Regulatory support to Agreement States \1\.......            20.2
    b. Generic decommissioning/reclamation (except those             6.5
     related to power reactors).........................
                                                         ---------------
        Total surcharge cost............................            72.8
Less 10 percent of NRC's FY 2006 total budget (less NWF            -69.3
 and WIR)...............................................
                                                         ---------------
        Total Net Surcharge Costs to be Recovered.......             3.5
------------------------------------------------------------------------

    As shown in Table IV, $3.5 million is the total net surcharge cost 
allocated to the various classes of licenses for FY 2006 (i.e., that 
portion of the total surcharge not covered by the NRC's 10 percent fee 
relief). The NRC has continued 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 surcharge costs allocated 
to each class is included in the annual fee assessed to each licensee. 
The FY 2006 surcharge costs (and the percent of total surcharge costs) 
allocated to each class of licenses, are shown in Table V (individual 
amounts may not sum to totals due to rounding). Separately, the NRC has 
continued to allocate the low-level waste (LLW) surcharge costs based 
on the volume of LLW disposal of certain classes of licenses. For FY 
2006, the LLW surcharge costs are $3.5 million.
---------------------------------------------------------------------------

    \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 activites. 
However, fees are not assessed to sources in Agreement States for 
these activities, therefore these costs are included in this 
surcharge category. Additionally, this estimate includes some costs 
associated with establishing a regulatory infrastructure for 
naturally occurring and accelerator produced radioactive material 
because this infrastructure will further the future regulation of 
these sources by both NRC and Agreement States.

                                        Table V.--Allocation of Surcharge
----------------------------------------------------------------------------------------------------------------
                                                       LLW surcharge           Non-LLW surcharge        Total
                                                ----------------------------------------------------  surcharge
                                                   Percent         $M        Percent         $M           $M
----------------------------------------------------------------------------------------------------------------
Operating Power Reactors.......................           74          2.6         83.7          2.9          5.5
Spent Fuel Storage/Reactor Decomm..............  ...........  ...........          4.3          0.2          0.2
Test and Research Reactors.....................  ...........  ...........          0.1            0            0
Fuel Facilities................................            8          0.3          6.5          0.2          0.5
Materials Users................................           18          0.6          4.1          0.1          0.8
Transportation.................................  ...........  ...........          0.7            0            0
Rare Earth Facilities..........................  ...........  ...........          0.1            0            0
Uranium Recovery...............................  ...........  ...........          0.4            0            0
                                                ----------------------------------------------------------------
    Total Surcharge............................          100          3.5        100.0          3.5          7.0
----------------------------------------------------------------------------------------------------------------

    The budgeted costs allocated to each class of licenses and the 
calculations of the rebaselined fees are described in paragraphs a. 
through h. below. The work papers which support this rule show in 
detail the allocation of NRC's budgeted resources for each class of 
licenses and how the fees are calculated. The reports included in these 
work papers summarize the FY 2006 budgeted FTE and contract dollars 
allocated to each fee class and surcharge category at the planned 
activity and program level, and compare these allocations to those used 
to develop final FY 2005 fees. The work papers 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. For a period 
of 90 days after the effective date of this final rule, the work papers 
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.
    Note that all budgeted resources and annual fee amounts presented 
in this document reflect an increase in the full cost of an FTE. This 
increase occurred due to the Government-wide pay raise and the more 
accurate allocation of overhead to the FTEs supporting fee classes 
versus surcharge categories, which increased the full cost of FTEs 
supporting fee classes. As a percent of

[[Page 30737]]

total fee-based budgeted resources, the resources associated with NRC's 
overhead actually declined from FY 2005 to FY 2006.
a. Fuel Facilities
    The FY 2006 budgeted cost to be recovered in the annual fees 
assessment to the fuel facility class of licenses is approximately 
$24.8 million. This value is derived based on the full cost of budgeted 
resources associated with all activities that support this fee class, 
which is reduced by estimated part 170 collections and adjusted to 
reflect the net allocated surcharge, allocated generic transportation 
resources, and billing adjustments. The summary calculations used to 
derive this value are presented in Table VI for FY 2006, with FY 2005 
values shown for comparison purposes (individual values may not sum to 
totals due to rounding):

     Table VI.--Annual Fee Summary Calculations for Fuel Facilities
                          [Dollars in millions]
------------------------------------------------------------------------
        Summary fee calculations           FY 2005 final   FY 2006 final
------------------------------------------------------------------------
Fuel Facility Fee Class:
    Total budgeted resources............           $38.2           $39.6
    Less estimated part 170 receipts....           -14.3           -15.8
                                         -------------------------------
    Net part 171 resources..............            24.0            23.8
    Plus allocated generic                          +N/A            +0.4
     transportation.....................
    Plus allocated surcharge............            +0.4            +0.5
    Billing adjustments (including                  -0.2            +0.0
     carryover and budget rescission)...
                                         -------------------------------
        Total required annual fee                   24.1            24.8
         recovery.......................
------------------------------------------------------------------------

    The small increase in fuel facilities FY 2006 total budgeted 
resources compared to FY 2005 is due mostly to an increase in the full 
cost of an FTE (as explained previously). The total required annual fee 
recovery also increases as a result of the allocation of generic 
transportation resources.
    The total required annual fee recovery amount is 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 work 
papers that are publicly 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.
    Once the structure of the matrix is established, the NRC's fuel 
facility project managers and regulatory analysts determine the level 
of effort associated with regulating each of these facilities. This is 
done by assigning, for each fuel facility, separate effort factors for 
the safety and safeguards activities associated with each type of 
regulatory activity. The matrix includes ten types of regulatory 
activities, including enrichment and scrap/waste related activities 
(see the work papers for the complete list). Effort factors are 
assigned as follows: zero (no regulatory effort), one (low regulatory 
effort), five (moderate regulatory effort), and ten (high regulatory 
effort). These effort factors are then totaled for each fee category, 
so that each fee category has a total effort factor for safety 
activities and a total effort factor for safeguards activities.
    The budgeted resources for safety activities are then allocated to 
each fee category based on its percent of the total regulatory effort 
for safety activities. For example, if the total effort factor for 
safety activities for all fuel facilities is 100, and the total effort 
factor for safety activities for a given fee category is ten, that fee 
category will be allocated ten percent of the total budgeted resources 
for safety activities. Similarly, the budgeted resources for safeguards 
activities are allocated to each fee category based on its percent of 
the total regulatory effort for safeguards activities. The surcharge 
that must be recovered from fuel facilities is allocated to each fee 
category based on its percent of the total regulatory effort for both 
safety and safeguards activities. The annual fee per licensee is then 
calculated by dividing the total allocated budgeted resources for the 
fee category by the number licensees in that fee category.
    The effort factors for the various fuel facility fee categories are 
summarized in Table VII. The value of the effort factors shown, as well 
as the percent of the total effort factor for all fuel facilities, 
reflects the total for each fee category (not per facility). Note this 
table includes the addition of a new fee category, as discussed 
immediately following the table.

[[Page 30738]]



                                 Table VII.--Effort Factors for Fuel Facilities
----------------------------------------------------------------------------------------------------------------
                                                                                    Effort factors  (percent of
                                                                     Number of                total)
                  Facility type (fee category)                      facilities   -------------------------------
                                                                                      Safety        Safeguards
----------------------------------------------------------------------------------------------------------------
High Enriched Uranium Fuel......................................               2      101 (38.0)       96 (52.2)
Enrichment......................................................               2       70 (26.3)       40 (21.7)
Low Enriched Uranium Fuel.......................................               3       66 (24.8)       21 (11.4)
UF6 Conversion..................................................               1        12 (4.5)         7 (3.8)
Limited Operations..............................................               1         8 (3.0)         3 (1.6)
Gas Centrifuge Enrichment Demonstration.........................               1         3 (1.1)        15 (8.2)
Hot Cell........................................................               1         6 (2.3)         2 (1.1)
----------------------------------------------------------------------------------------------------------------

    The NRC is dividing fee category 1.A.2.b under Sec.  170.31 into 
two categories, and is using the existing fee methodology to establish 
separate annual fees for these two categories. Currently, fee category 
1.A.2.b captures all fuel facility licensees that do not fall into 
other fee categories. There are currently two licensees in this fee 
category; one is a gas centrifuge enrichment demonstration facility, 
and one is a hot cell facility. The NRC provides significantly 
different levels of regulatory support for these facilities. For 
example, the gas centrifuge enrichment demonstration facility generates 
and requires the safe management of significantly greater amounts of 
sensitive information. For this reason, the NRC is dividing this fee 
category into two categories to separately establish annual fees for 
these two types of facilities based on the NRC's resources (i.e., level 
of effort) specifically associated with regulating each type of 
facility. This change better aligns the NRC's budgeted resources with 
the fees assessed to these two facilities.
    Applying the FY 2006 effort factors (as summarized in Table VII) to 
the safety, safeguards, and surcharge components of the $24.8 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 VIII. Note that the annual fees for the gas centrifuge 
enrichment demonstration and UF6 conversion facilities are 
higher than the FY 2005 annual fees because the safeguards effort 
factors for these facilities have been raised. These revised factors 
better reflect the effort levels associated with safeguards activities 
for these facilities, including those associated with interim 
compensatory measures and the handling of sensitive information.

              Table VIII.--Annual Fees for Fuel Facilities
------------------------------------------------------------------------
                                                              FY 2006
              Facility type (fee category)                  annual fee
------------------------------------------------------------------------
High Enriched Uranium Fuel..............................      $5,420,000
Uranium Enrichment......................................       3,027,000
Low Enriched Uranium....................................       1,596,000
UF6 Conversion..........................................       1,046,000
Gas Centrifuge Enrichment Demonstration.................         991,000
Limited Operations Facility.............................         605,000
Hot Cell................................................         440,000
------------------------------------------------------------------------

    Note the fuel facility annual fees decreased slightly between the 
FY 2006 proposed and final fee rules due to (1) the revised allocation 
of the ``Homeland Security Unallocated'' planned activity, which 
resulted in fewer budgeted resources allocated to this fee class 
(discussed further in Section II.D.1), and (2) a reduction of allocated 
resources for generic transportation activities (discussed further in 
Section III.B.3.h).
    As mentioned previously, the NRC is currently reviewing 
applications to build and operate gas centrifuge uranium enrichment 
facilities. If these facilities are licensed to operate, they will be 
subject to an annual fee in accordance with the methodology described 
previously. The NRC's current plans are to establish a separate fee 
category for these facilities.
b. Uranium Recovery Facilities
    The total FY 2006 budgeted cost to be recovered through annual fees 
assessed to the uranium recovery class is approximately $1.1 million. 
The derivation of this value is shown below, with FY 2005 values shown 
for comparison purposes. (Individual values may not sum to totals due 
to rounding.)

     Table IX.--Annual Fee Summary Calculations for Uranium Recovery
                               Facilities
                          [Dollars in millions]
------------------------------------------------------------------------
        Summary fee calculations           FY 2005 final   FY 2006 final
------------------------------------------------------------------------
Uranium Recovery Fee Class:
    Total budgeted resources............           $2.01           $2.34
    Less estimated part 170 receipts....           -1.30           -1.29
                                         -------------------------------
    Net part 171 resources..............            0.71            1.05
    Plus allocated generic                          +N/A            +N/A
     transportation.....................
    Plus allocated surcharge............           +0.01           +0.01
    Billing adjustments (including                 -0.01           +0.00
     carryover and budget rescission)...
                                         -------------------------------
        Total required annual fee                   0.70            1.06
         recovery.......................
------------------------------------------------------------------------

    The increase in budgeted resources reflects the reallocation of 
existing NRC FTE to uranium recovery licensing and inspection 
activities from other activities (e.g., Agreement State oversight). The 
part 170 estimate (as shown above) reflects an increase, over 
historical actual part 170 collections, to fully account for these 
additional activities. The FY 2006 part 170 estimate is not much 
different than the FY 2005 part 170 estimate because the

[[Page 30739]]

FY 2005 estimate was higher than the actual part 170 collections.
    Of the required annual fee collections, approximately $732,000 
would be assessed to DOE. The remaining $329,000 would be recovered 
through annual fees assessed to conventional mills, in-situ leach 
solution mining facilities, and 11e.(2) mill tailings disposal 
facilities (incidental to existing tailings sites).
    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 
results 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 in Table X.

   Table X.--Costs Recovered Through Annual Fees; Uranium Recovery Fee
                                  Class
------------------------------------------------------------------------
 
------------------------------------------------------------------------
DOE Annual Fee Amount [Uranium Mill Tailings Radiation
 Control Act (UMTRCA) Title I and Title II general
 licenses]:
    UMTRCA Title I budgeted costs.......................        $402,913
    50 percent of generic/other uranium recovery                 322,722
     budgeted costs.....................................
    50 percent of uranium recovery surcharge............           6,536
                                                         ---------------
        Total Annual Fee Amount for DOE (rounded).......         732,000
Annual Fee Amount for UMTRCA Title II Specific Licenses:
    50 percent of generic/other uranium recovery                 322,722
     budgeted costs.....................................
    50 percent of uranium recovery surcharge............           6,536
                                                         ---------------
        Total Annual Fee Amount for Title II Specific            329,258
         Licenses.......................................
------------------------------------------------------------------------

    The matrix used to allocate the costs of various categories of 
Title II specific licensees has been reviewed and continues to equally 
weight, as in FY 2005, the effort levels for each category of uranium 
recovery facilities, in accordance with the NRC's FY 2006 budgeted 
activities. As such, each non-DOE uranium recovery licensee will be 
assessed an equal share of the total annual fee amount for UMTRCA Title 
II specific licenses. Additionally, the NRC is maintaining the existing 
approach for establishing part 171 annual fees for Title II uranium 
recovery licensees [established in the FY 1995 fee rule (60 FR 32218; 
June 20, 1995)]. This approach 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 category 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 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 XI.--Weighted Factors For Uranium Recovery Licenses
----------------------------------------------------------------------------------------------------------------
                                                                                         Level of benefit
                                                                                 -------------------------------
                  Facility type                      Number of       Category              Total weight
                                                    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               1             800             800              20
 sites..........................................
----------------------------------------------------------------------------------------------------------------

    Applying these factors to the approximately $329,000 in budgeted 
costs to be recovered from Title II specific licensees results in the 
following revised annual fees for FY 2006:

         Table XII.--Annual Fees for Title II Specific Licenses
------------------------------------------------------------------------
                                                              FY 2006
                      Facility type                         annual fee
------------------------------------------------------------------------
Class I (conventional mills)............................         $65,900
Class II (solution mining)..............................          65,900

[[Page 30740]]

 
11e.(2) disposal........................................             N/A
11e.(2) disposal incidental to existing tailings sites..          65,900
------------------------------------------------------------------------

    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.
    The uranium recovery annual fees decreased slightly between the FY 
2006 proposed and final fee rules due to the revised allocation of the 
``Homeland Security Unallocated'' planned activity, which resulted in 
fewer budgeted resources allocated to this fee class (discussed further 
in Section II.D.1).
    As discussed in Section III.B.4, ``Eliminating the Existing Fee 
Payment Exception for Uranium Recovery Licensees,'' the NRC is 
establishing that all Title II facilities be subject to the billing 
provisions of Sec.  171.19(c), which state that annual fees that are 
less than $100,000 are billed on the anniversary date of the license.
c. Operating Power Reactors
    The approximately $367.2 million in budgeted costs to be recovered 
through FY 2006 annual fees assessed to the power reactor class was 
calculated as shown in Table XIII. (FY 2005 values shown for comparison 
purposes; individual amounts may not sum to totals due to rounding.)

    Table XIII.--Annual Fee Summary Calculations for Operating Power
                                Reactors
                          [Dollars in millions]
------------------------------------------------------------------------
        Summary fee calculations           FY 2005 final   FY 2006 final
------------------------------------------------------------------------
Operating Power Reactors Fee Class:
    Total budgeted resources............          $440.7          $515.9
    Less estimated part 170 receipts....          -130.5          -155.2
                                         -------------------------------
    Net part 171 resources..............           310.2           360.7
    Plus allocated transportation.......            +N/A            +0.8
    Plus allocated surcharge............            +4.0            +5.5
    Billing adjustments (including                  -2.6            +0.2
     carryover, any budget rescission)..
                                         -------------------------------
        Total required annual fee                  311.6           367.2
         recovery.......................
------------------------------------------------------------------------

    The budgeted costs to be recovered through annual fees to power 
reactors, including those for homeland security activities related to 
power reactors, is divided equally among the 104 power reactors 
licensed to operate. This results in a FY 2006 annual fee of $3,531,000 
per reactor. Additionally, each power reactor licensed to operate will 
be assessed the FY 2006 spent fuel storage/reactor decommissioning 
annual fee of $173,000. This results in a total FY 2006 annual fee of 
$3,704,000 for each power reactor licensed to operate.
    The annual fee for power reactors increases in FY 2006 compared to 
FY 2005 due to an increase in budgeted resources for a number of 
activities, including regulatory infrastructure for new reactor 
licensing activities, preparations for future combined license 
applications, homeland security-related mitigating strategies, 
licensing tasks related to the aging of reactor systems and components, 
and evaluating and resolving operational issues. As shown previously, 
the NRC estimates an increase in part 170 collections of about 19 
percent from operating power reactors; these collections offset the 
required annual fee recovery amount by a total of over $155 million.
    The power reactor annual fee increased by about one percent between 
the FY 2006 proposed and final rules because of (1) a decrease in the 
estimated part 170 collections from this fee class, based on the latest 
four quarters of invoices available, and (2) the revised allocation of 
the ``Homeland Security Unallocated'' planned activity, which resulted 
in more budgeted resources allocated to this fee class (discussed 
further in Section II.D.1).
d. Spent Fuel Storage/Reactor Decommissioning
    For FY 2006, budgeted costs of approximately $21.2 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. Table XIV below shows the calculation of this annual 
fee amount. (FY 2005 values shown for comparison purposes; individual 
values may not sum to totals due to rounding.)

 Table XIV.--Annual Fee Summary Calculations for the Spent Fuel Storage/
                    Reactor Decommissioning Fee Class
                          [Dollars in millions]
------------------------------------------------------------------------
        Summary fee calculations           FY 2005 final   FY 2006 final
------------------------------------------------------------------------
Spent Fuel Storage/Reactor--
 Decommissioning Fee Class:
    Total budgeted resources............           $25.1           $26.6
    Less estimated part 170 receipts....            -5.7            -5.8
                                         -------------------------------
    Net part 171 resources..............            19.4            20.8
    Plus allocated generic                          +N/A            +0.2
     transportation.....................
    Plus allocated surcharge............            +0.1            +0.2
    Billing adjustments (including                  -0.1            +0.0
     carryover and budget rescission)...
                                         -------------------------------

[[Page 30741]]

 
        Total required annual fee                   19.4            21.2
         recovery.......................
------------------------------------------------------------------------

    The required annual fee recovery amount is divided equally among 
122 licensees (and to one new licensee with a 60 prorated annual fee, 
in accordance with Sec.  171.17(a)), resulting in a FY 2006 annual fee 
of $173,000 per licensee. The value of total budgeted resources for 
this fee class increased in FY 2006 compared to FY 2005 due to an 
increase in the full cost of a budgeted FTE, the allocation of generic 
transportation resources, and relatively small increases in contracts 
allocated for activities such as licensing/certification and training.
    The annual fee for this fee class increased slightly between the FY 
2006 proposed and final fee rules because of a reduced estimate of part 
170 fee collections, based on the latest four quarters of invoices.
e. Test and Research Reactors (Nonpower Reactors)
    Approximately $320,000 in budgeted costs is to be recovered through 
annual fees assessed to the test and research reactor class of licenses 
for FY 2006. Table XV summarizes the annual fee calculation for test 
and research reactors for FY 2006 (as compared to FY 2005). Individual 
values may not sum to totals due to rounding.

    Table XV.--Annual Fee Summary Calculations for Test and Research
                                Reactors
                          [Dollars in millions]
------------------------------------------------------------------------
    Summary fee calculations/test and
       research reactors fee class         FY 2005 final   FY 2006 final
------------------------------------------------------------------------
Total budgeted resources................           $0.52           $0.88
Less estimated part 170 receipts........           -0.28           -0.57
                                         -------------------------------
Net part 171 resources..................            0.24            0.31
Plus allocated generic transportation...            +N/A           +0.01
Plus allocated surcharge................           +0.00           +0.01
Billing adjustments (including carryover           -0.00           +0.00
 and budget rescission).................
                                         -------------------------------
    Total required annual fee recovery..            0.24            0.32
------------------------------------------------------------------------

    This required annual fee recovery amount is divided equally among 
the four test and research reactors subject to annual fees, and results 
in a FY 2006 annual fee of $80,100 for each licensee. This increase in 
annual fees from FY 2005 to FY 2006 is due to a relatively large 
increase in budgeted resources for licensing activities for test and 
research reactors, which is part of an initiative to reduce a backlog 
of reactor licensing actions. Although the NRC estimates that much of 
this increase will result in an increase in estimated part 170 
collections (which is factored into the part 170 estimates above), some 
of these resources are projected to be associated with non-licensee 
specific activities, and therefore will need to be recovered under part 
171.
    Note the annual fee for test and research reactors increased by 
about five percent between the FY 2006 proposed and final fee rules. 
This is due to a lower estimate of part 170 fee collections, based on 
the latest four quarters of invoices.
f. Rare Earth Facilities
    The FY 2006 budgeted costs of $95,900 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 2006 annual fee of $95,900. Table XVI 
summarizes the annual fee calculation for the rare earth fee class for 
FY 2006 (as compared to FY 2005). (Individual values may not sum to 
totals due to rounding.)

  Table XVI.--Annual Fee Summary Calculations for Rare Earth Facilities
                          [Dollars in millions]
------------------------------------------------------------------------
        Summary fee calculations           FY 2005 final   FY 2006 final
------------------------------------------------------------------------
Rare Earth Fee Class:
    Total budgeted resources............          $0.875          $0.831
    Less estimated part 170 receipts....          -0.800          -0.740
                                         -------------------------------
    Net part 171 resources..............           0.075           0.091
    Plus allocated generic                          +N/A            +N/A
     transportation.....................
    Plus allocated surcharge............          +0.000          +0.005
    Billing adjustments (including                -0.000          +0.000
     carryover and budget rescission)...
                                         -------------------------------
    Total required annual fee recovery..           0.074           0.096
------------------------------------------------------------------------


[[Page 30742]]

    The total allocated resources for this fee class decreased slightly 
in FY 2006 compared to FY 2005, but the annual fee increases due to 
lower estimated part 170 collections. Note the rare earth annual fee 
decreased slightly between the FY 2006 proposed and final fee rules 
because of the revised allocation of the `Homeland Security 
Unallocated' planned activity, which resulted in fewer budgeted 
resources allocated to this fee class (discussed further in Section 
II.D.1).
g. Materials Users
    Table XVII shows the calculation of the FY 2006 annual fee amount 
for materials users licensees. (FY 2005 values shown for comparison 
purposes; individual values may not sum to totals due to rounding.)

    Table XVII.--Annual Fee Summary Calculations for Materials Users
                          [Dollars in millions]
------------------------------------------------------------------------
Summary fee calculations/materials users   FY 2005 final   FY 2006 final
------------------------------------------------------------------------
Fee Class:
    Total budgeted resources............           $27.5           $30.3
    Less estimated part 170 receipts....            -1.9            -2.0
                                         -------------------------------
    Net part 171 resources..............            25.6            28.2
    Plus allocated generic                          +N/A            +0.6
     transportation.....................
    Plus allocated surcharge............            +0.6            +0.8
    Billing adjustments (including                  -0.1            +0.0
     carryover and budget rescission)...
                                         -------------------------------
        Total required annual fee                   26.0            29.6
         recovery.......................
------------------------------------------------------------------------

    To equitably and fairly allocate the $29.6 million in FY 2006 
budgeted costs to be recovered in annual fees assessed to the 
approximately 4,400 billable diverse materials users licensees, 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. 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 materials users 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 
$21.5 million in general costs (including allocated generic 
transportation costs) and is 1.21 for FY 2006. The inspection 
multiplier is the multiple necessary to recover approximately $7.2 
million in inspection costs, and is 1.57 for FY 2006. The unique 
category costs are any special costs that the NRC has budgeted for a 
specific category of licenses. For FY 2006, approximately $111,000 in 
budgeted costs for the implementation of revised 10 CFR 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 $143,000 in surcharge costs allocated to the materials users class 
of licenses and, for certain categories of these licenses, a share of 
the approximately $634,000 in LLW surcharge costs allocated to the 
class. The annual fee for each fee category is shown in Sec.  
171.16(d).
    The annual fees for materials licensees increased in FY 2006 mainly 
because of an increase in budgeted resources for activities relating to 
information technology/tracking systems for these types of licensees 
(including tracking that relates to homeland security purposes), 
increases for inspection activities, and the allocation of generic 
transportation resources. Increases in annual fees for materials users 
licensees (other than master materials licenses, for which the annual 
fee increased 49 percent) range from approximately four percent to 
approximately 23 percent. These changes reflect the overall increase of 
over 14 percent in budgeted resources to be recovered through annual 
fees to this fee class; the actual percentage increase for different 
fee categories varies mainly because of the difference in how 
inspection versus other types of resources are distributed to the fee 
categories. For example, the inspection resources to be recovered 
through annual fees increased more than non-inspection resources from 
FY 2005 to FY 2006. Those fee categories that receive a relatively 
larger share of these inspection budgeted costs (due to their higher 
average hours per inspection), have annual fees that increase somewhat 
more than other fee categories, as compared to FY 2005. This is also a 
key reason for the master materials license fee increase.
    Between the FY 2006 proposed and final fee rules, annual fees 
increased slightly for some materials users licensees, decreased 
slightly for others, and remained the same for the majority. The 
reasons for changes in the materials users fees are (1) A slight 
reduction in the estimated part 170 collections for this fee class, 
which increased the annual fee recovery amount; (2) a small decrease in 
allocated resources from the `Homeland Security Unallocated' planned 
activity (discussed in Section II.D.1); (3) a decrease in allocated 
generic transportation resources (discussed in more detail in Section 
III.B.3.h); and (4) the transfer of approximately 150 licensees to the 
State of Minnesota (see Section III.B.3.5).
    The impact of the transfer of licensees to the State of Minnesota 
is that the budgeted resources for most licensing and inspection 
activities for the materials users fee class are allocated to fewer 
licensees. The FY 2006 final fee rule calculations reflect the 
allocation of a larger percentage of materials users regulatory 
infrastructure resources to the surcharge category of Agreement State 
Regulatory Support because these infrastructure resources are allocated 
to the surcharge based on the percentage of total materials users 
licensees in Agreement States (and this percentage increased from 79 to 
80 percent between the FY 2006 proposed and final fee rules). However, 
budgeted resources for

[[Page 30743]]

activities such as licensing and inspections for NRC materials users 
licensees are not allocated to the surcharge because they do not 
benefit Agreement States or their licensees. Therefore, the transfer of 
licensees to the State of Minnesota between the FY 2006 proposed and 
final fee rules increased the amount of licensing and inspection 
resources to be recovered per NRC licensee. The impact of this action 
was somewhat offset by the changes listed in (2) and (3) in the 
preceding paragraph; the result is that there are no significant 
changes in materials users fees inbetween the FY 2006 proposed and 
final fee rules.
h. Transportation
    Table XVIII shows the calculation of the FY 2006 generic 
transportation budgeted resources to be recovered through annual fees. 
(FY 2005 values shown for comparison purposes.)

    Table XVIII.--Annual Fee Summary Calculations for Transportation
                          [Dollars in millions]
------------------------------------------------------------------------
 Summary Fee calculations/transportation   FY 2005 final   FY 2006 final
------------------------------------------------------------------------
Fee Class:
    Total budgeted resources............            $5.4            $6.3
    Less estimated part 170 receipts....            -1.1            -1.2
                                         -------------------------------
    Net part 171 resources (required                 4.3             5.1
     annual fee recovery)...............
------------------------------------------------------------------------

    As discussed previously, the NRC is recovering generic 
transportation costs unrelated to DOE as part of existing annual fees 
for license fee classes. Under this approach, the annual fee for fee 
categories 10.B.1 and 10.B.2 under Sec.  171.16 are eliminated, but the 
NRC will continue to assess a separate annual fee under Sec.  171.16, 
fee category 18.A, for DOE transportation activities.
    The total FY 2006 budgeted resources for generic transportation 
activities, including those to support DOE CoCs, is $5.1 million. 
[Generic transportation resources associated with fee-exempt entities 
are not included in this total; these costs are included in the 
appropriate surcharge category (e.g., the surcharge category for 
nonprofit educational institutions).] These resources are distributed 
to DOE (to be included in its annual fee under fee category 18.A of 
Sec.  171.16) and each license fee class based on the CoCs used by DOE 
and each fee class, as a proxy for the generic resources expended for 
each fee class. (Note that the number of CoCs used by fee class is 
adjusted to take into account the percentage of licensees in that fee 
class subject to annual fees, as explained previously.) As such, the 
amount of the generic resources allocated is calculated by multiplying 
the percentage of total CoCs used by each fee class (and DOE) by the 
total generic transportation resources to be recovered.
    For the FY 2006 final fee rule, the amount of generic 
transportation resources allocated to the fee classes was reduced by 
the amount of estimated annual fee collections for QA program approvals 
in FY 2006 (approximately $1.9 million). This is because of the timing 
of the issuance and effective date of the FY 2006 fee rule: The NRC is 
receiving payments for annual fees for transportation activities (fee 
categories 10.B.1 and 10.B.2 under Sec.  171.16 for QA program approval 
activities) until the effective date of this fee rule. As such, these 
collections have been applied to the NRC's fee recovery of FY 2006 
generic transportation resources. This is only a one-time adjustment 
because the 10.B.1 and 10.B.2 annual fees have been eliminated as of 
the effective date of this rule. Therefore, licensees should expect the 
value of these allocated transportation resources to increase in future 
years. Note that the NRC has applied the $1.9 million in FY 2006 QA 
program approval fee collections to the generic transportation 
resources to be recovered from the fee classes, only, and not to DOE's 
required annual fee recovery. This is because DOE is not subject to the 
QA program approval requirements as are commercial licensees. 
Accordingly, DOE did not pay these QA program approval fees nor benefit 
from these approvals.
    The distribution of these resources to the license fee classes and 
DOE is as follows (individual values may not sum to totals due to 
rounding):

                      Table XIX.--Distribution of Generic Transportation Resources, FY 2006
                                              [Dollars in millions]
----------------------------------------------------------------------------------------------------------------
                                                                     No. CoCs                        Allocated
                                                                    benefitting    Percentage of      generic
                                                                   fee class (or    total CoCs    transportation
                                                                       DOE)          (percent)       resources
----------------------------------------------------------------------------------------------------------------
License fee class/DOE:
    Total.......................................................             134             100           $5.13
    DOE.........................................................              33            24.6            1.26
                                                                 -----------------------------------------------
    Remainder to be Recovered...................................  ..............  ..............            3.87
    Less Estimated FY 2006 QA program approval fee collections..  ..............  ..............            1.90
                                                                 -----------------------------------------------
    Net Amount to be Recovered from Fee Classes.................  ..............  ..............            1.97
Fee Classes:
    Total (w/o DOE).............................................             101             100            1.97
    Operating Power Reactors....................................              39            38.4            0.76
    Spent Fuel Storage/Reactor Decommissioning..................               9             8.9            0.17
    Test and Research Reactors..................................             0.3             0.3            0.01
    Fuel Facilities.............................................              21            20.7            0.41

[[Page 30744]]

 
    Materials Users.............................................              32            31.7            0.63
----------------------------------------------------------------------------------------------------------------

    The NRC is continuing to assess DOE an annual fee based on the part 
71 CoCs it holds. The NRC is not allocating these DOE-related resources 
to other licensees' annual fees because these resources specifically 
support DOE; hence the current fee recovery methodology for these 
resources remains efficient and equitable. Note that DOE's annual fee 
includes a portion of the surcharge, resulting in a total annual fee of 
$1,285,000 for FY 2006. This fee increases from last year due to 
budgeted increases for licensing/certification activities and an 
increase in the full cost of an FTE. The fee decreased slightly between 
the FY 2006 proposed and final fee rules because of a small decrease in 
allocated resources from the `Homeland Security Unallocated' planned 
activity (discussed in Section II.D.1).
4. Eliminating the Existing Fee Payment Exception for Uranium Recovery 
Licensees
    Under the payment provisions of Sec.  171.19, the NRC currently 
bills licensees' part 171 fees annually if their annual fees are less 
than $100,000, and quarterly if their annual fees are $100,000 or more. 
However, the NRC bills Class I and Class II uranium recovery licensees 
quarterly in accordance with Sec.  171.19(b), regardless of the amount 
of their annual fee. The NRC established this payment exception for 
Class I and Class II uranium recovery licensees in the FY 2001 final 
rule (66 FR 32452; June 14, 2001) because the annual fees for these 
licensees had been fluctuating just above or below $100,000. Since 
then, uranium recovery license fees have been well below $100,000. 
Because the basis of this billing exception is now not a factor, and 
this exception is administratively burdensome to implement with the 
current fee billing system, the NRC is eliminating the billing 
exception for Class I and Class II uranium recovery licensees. These 
licensees are now subject to the same payment provisions as all other 
licensees, as described previously.
5. Agreement State Activities
    By letter dated July 6, 2004, Governor Tim Pawlenty of Minnesota 
requested that the NRC enter into an Agreement with the State as 
authorized by Section 274 of the Atomic Energy Act of 1954, as amended. 
The Commission approved this Agreement on January 26, 2006, and the 
Agreement took effect March 31, 2006. This resulted in the transfer of 
approximately 150 licenses to the State of Minnesota from the NRC.
    Note that the continuing costs of Agreement State regulatory 
support and oversight for the State of Minnesota, as for any other 
Agreement State, are recovered through the surcharge (as reduced by the 
ten percent of its budget that the NRC receives in appropriations each 
year for these types of activities), consistent with existing policy. 
As discussed in Sections II.C.1 and III.B.g, the budgeted resources for 
the regulatory infrastructure to support these types of licensees are 
prorated to the surcharge based on the percent of total licensees in 
Agreement States. Accordingly, as a result of the State of Minnesota 
becoming an Agreement State, the NRC has increased the percentage of 
materials users regulatory infrastructure costs that are recovered 
through the surcharge. Specifically, this percentage increased from 79 
to 80 between the FY 2006 and proposed and final fee rules. However, 
some resources associated with the materials users fee class are not 
prorated to the surcharge (e.g., resources for licensing and inspection 
activities), because these resources are for the purpose of supporting 
NRC licensees, only. As such, the transfer of licensees to the State of 
Minnesota resulted in an increase in annual fees for some materials 
users licensees because the budgeted resources for activities such as 
licensing and inspection are now spread to fewer NRC licensees.
6. Administrative Amendments
    The NRC is clarifying the definition of ``overhead and general and 
administrative costs'' under Sec.  171.5. This definition provides 
examples of organizations that are included as ``indirect costs.'' The 
NRC is clarifying that certain costs of some of these organizations are 
not considered to be indirect; therefore, in these instances, these 
costs are not included in overhead and general and administrative 
costs. For example, the Atomic Safety and Licensing Board Panel (ASLBP) 
is listed as an indirect office in this definition. There are instances 
in which the ASLBP performs direct mission-related work, and the 
budgeted resources for these activities are considered to be direct in 
the fee calculations (consistent with the categorization of these 
resources in the NRC's budget). The NRC believes this clarification 
better reflects the most recent data on the types of budgeted resources 
associated with these offices. Additionally, this definition is revised 
to eliminate reference to an organization within the agency that no 
longer exists.
    In summary, the NRC is--
    1. Proceeding with the presumption in favor of rebaselining 
beginning with the FY 2006 fee rule;
    2. Recovering generic transportation costs as part of other 
existing annual fees;
    3. Revising the annual fees to reflect the FY 2006 budget and other 
changes;
    4. Eliminating the existing fee payment exception for Class I and 
Class II uranium recovery licensees;
    5. Revising the number of NRC licensees given that the State of 
Minnesota became an Agreement State; and,
    6. Making an administrative change to clarify the definition of 
``overhead and general and administrative costs.''

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 final rule, the NRC is amending 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 2006 as required by the Omnibus Budget 
Reconciliation Act of 1990, as amended. This action does not constitute 
the establishment of a

[[Page 30745]]

standard that contains generally applicable requirements.

V. Environmental Impact: Categorical Exclusion

    The NRC has determined that this final 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 final 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 final 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 final 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 of 1954 and with applicable regulations;
    (3) The NRC could charge for costs incurred in conducting 
environmental reviews required by the National Environmental Policy 
Act;
    (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 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. As 
mentioned previously, the FY 2001 EWDAA 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 was 90 percent in FY 2005. The FY 2006 
EWDAA extended this 90 percent fee recovery requirement through FY 
2006. As a result, the NRC is required to recover approximately 90 
percent of its FY 2006 budget authority, less the amounts appropriated 
from the NWF and for WIR activities, through fees. To comply with this 
statutory requirement and in accordance with Sec.  171.13, the NRC is 
publishing the amount of the FY 2006 annual fees for reactor licensees, 
fuel cycle licensees, materials licensees, and holders of Certificates 
of Compliance, registrations of sealed source and devices, 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 2006 budget of $741.5 million less the funds directly 
appropriated from the NWF to cover the NRC's high-level waste program 
and for WIR activities, and less the amount of funds collected from 
part 170 fees;
    (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 2006 
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 final rule establishes the schedules of fees that are 
necessary to implement the Congressional mandate for FY 2006. This rule 
will 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 Analysis, prepared in accordance with 5 U.S.C. 604, is 
included as Appendix A to this final rule.
    The Congressional Review 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 2006.

IX. Backfit Analysis

    The NRC has determined that the backfit rule, 10 CFR 50.109, does 
not apply to this final rule and that a backfit analysis is not 
required for this final rule. The backfit analysis is not required 
because these amendments do not require the modification of, or 
additions to systems, structures, components, or

[[Page 30746]]

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.

X. Small Business Regulatory Enforcement Fairness Act

    In accordance with the Small Business Regulatory Enforcement 
Fairness Act of 1996, Pub. L. 104-121, the NRC has determined that this 
action is a major rule and has verified the determination with the 
Office of Information and Regulatory Affairs of the Office of 
Management and Budget.

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.


0
For the reasons set out in the preamble and under the authority of the 
Atomic Energy Act of 1954, as amended; the Energy Reorganization Act of 
1974, as amended; and 5 U.S.C. 552 and 553, the NRC is adopting 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

0
1. The authority citation for part 170 is revised 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); 
sec. 623, Pub. L. 109-58, 119 Stat. 783 (42 U.S.C. 2201(w)).


0
2. In Sec.  170.3, the definition of special projects is revised to 
read as follows:


Sec.  170.3  Definitions.

* * * * *
    Special projects means those requests submitted to the Commission 
for review for which fees are not otherwise specified in this chapter 
and contested hearings on licensing actions directly related to U.S. 
Government national security initiatives, as determined by the NRC. 
Examples of special projects include, but are not limited to, contested 
hearings on licensing actions directly related to Presidentially-
directed national security programs, topical report reviews, early site 
reviews, waste solidification facilities, activities related to the 
tracking and monitoring of shipment of classified matter, services 
provided to certify licensee, vendor, or other private industry 
personnel as instructors for part 55 reactor operators, reviews of 
financial assurance submittals that do not require a license amendment, 
reviews of responses to Confirmatory Action Letters, reviews of uranium 
recovery licensees' land-use survey reports, and reviews of 10 CFR 
50.71 final safety analysis reports. Special projects does not include 
those contested hearings for which a fee exemption is granted in Sec.  
170.11(a)(2), including those related to individual plant security 
modifications.
* * * * *

0
3. In Sec.  170.11, paragraph (a)(5) is removed and reserved, and 
paragraph (a)(4)(iii) and the introductory text of paragraph (a)(9), 
paragraph (a)(9)(i) and the introductory text of paragraph (a)(9)(ii) 
are revised as follows:


Sec.  170.11  Exemptions.

    (a) * * *
    (4) * * *
    (iii) Distribution of byproduct material, source material, or 
special nuclear material or products containing byproduct material, 
source material or special nuclear material; or
* * * * *
    (9) Federally-owned and State-owned research reactors used 
primarily for educational training and academic research purposes. For 
purposes of this exemption, the term research reactor means a nuclear 
reactor that--
    (i) Is licensed by the Nuclear Regulatory Commission under section 
104c. of the Atomic Energy Act of 1954 (42 U.S.C. 2134(c)) at a thermal 
power level of 10 megawatts or less; and
    (ii) If so licensed at a thermal power level of more than 1 
megawatt, does not contain--
* * * * *

0
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, excluding reactor 
decommissioning and import/export licensing activities): $217 per hour
    (b) Nuclear Materials and Nuclear Waste Program (Sec.  170.31 
Activities, as well as the reactor decommissioning and import/export 
licensing activities covered under Sec.  170.21): $214 per hour

0
5. In Sec.  170.21, Category K and footnote 1 in the table are revised 
to read as follows:


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

* * * * *

                        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               $13,900

[[Page 30747]]

 
        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                $8,100
        3. Application for export of components
         requiring the assistance of the Executive
         Branch to obtain foreign government assurances.
            Application--new license, or amendment                $2,600
        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                $1,700
        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..
            Minor amendment                                        $320
------------------------------------------------------------------------
\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.
\2\ Full cost fees will be determined based on the professional staff
  time and appropriate contractual support services expended. For
  applications currently on file and for which fees are determined based
  on the full cost expended for the review, the professional staff hours
  expended for the review of the application up to the effective date of
  the final rule will be determined at the professional rates in effect
  at the time the service was provided. For those applications currently
  on file for which review costs have reached an applicable fee ceiling
  established by the June 20, 1984, and July 2, 1990, rules, but are
  still pending completion of the review, the cost incurred after any
  applicable ceiling was reached through January 29, 1989, will not be
  billed to the applicant. Any professional staff-hours expended above
  those ceilings on or after January 30, 1989, will be assessed at the
  applicable rates established by Sec.   170.20, as appropriate, except
  for topical reports whose costs exceed $50,000. Costs which exceed
  $50,000 for any topical report, amendment, revision or supplement to a
  topical report completed or under review from January 30, 1989,
  through August 8, 1991, will not be billed to the applicant. Any
  professional hours expended on or after August 9, 1991, will be
  assessed at the applicable rate established in Sec.   170.20.
* * * * * * *
\4\ Imports only of major components for end-use at NRC-licensed
  reactors are now authorized under NRC general import license.


0
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. For those fee categories identified to be subject to full 
cost fees, full cost fees will be assessed for all licensing and 
inspection activities, unless otherwise indicated.

                       Schedule of Materials Fees
                     [See footnotes at end of table]
------------------------------------------------------------------------
Category of materials licenses and type of fees
                      \1\                                Fees 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) Gas centrifuge enrichment            Full Cost.
         demonstration facilities.
        (c) Hot cell facilities................  Full Cost.
    B. Licenses for receipt and storage of       Full Cost.
     spent fuel 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 nuclear material in sealed sources
     contained in devices used in industrial
     measuring systems, including x-ray
     fluorescence analyzers: \4\
        Application............................  $990.
    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............................  $2,000.

[[Page 30748]]

 
    E. Licenses or certificates for              Full Cost.
     construction and operation of a uranium
     enrichment facility.
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.
    (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............................  $240.
    C. All other source material licenses:
        Application............................  $8,400.
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............................  $10,000.
    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............................  $3,800.
    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............................  $5,100.
    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............................  $3,600.
    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............................  $2,500.
    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............................  $5,000.
    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............................  $12,000.
    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............................  $14,600.
    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............................  $8,700.
    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............................  $1,500.
    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............................  $880.
    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............................  $8,400.

[[Page 30749]]

 
    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............................  $3,400.
    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............................  $3,800.
    O. Licenses for possession and use of
     byproduct material issued under part 34 of
     this chapter for industrial radiography
     operations:
        Application............................  $3,500.
    P. All other specific byproduct material
     licenses, except those in Categories 4A
     through 9D:
        Application............................  $1,200.
    Q. Registration of a device(s) generally
     licensed under part 31 of this chapter:
        Registration...........................  $730.
4. Waste disposal and processing:
    A. Licenses specifically authorizing the     Full Cost.
     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:
    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............................  $2,600.
    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............................  $3,900.
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............................  $1,400.
    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............................  $17,100.
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............................  $9,400.
    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............................  $6,700.
    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............................  $2,300.
8. Civil defense:
    A. Licenses for possession and use of
     byproduct material, source material, or
     special nuclear material for civil defense
     activities:
        Application............................  $490.
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...............  $21,000.
    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...............  $21,000.
    C. Safety evaluation of sealed sources
     containing byproduct material, source
     material, or special nuclear material,
     except reactor fuel, for commercial
     distribution:
        Application--each source...............  $2,400.
    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...............  $810.
10. Transportation of radioactive material:
    A. Evaluation of casks, packages, and
     shipping containers:
        1. Spent Fuel, High-Level Waste, and     Full Cost.
         plutonium air packages.

[[Page 30750]]

 
        2. Other Casks.........................  Full Cost.
    B. Quality assurance program approvals
     issued under part 71 of this chapter.
        1. Users and Fabricators
            Application........................  $5,600.
            Inspections........................  Full Cost.
        2. Users
            Application........................  $5,600.
            Inspections........................  Full Cost.
    C. Evaluation of security plans, route       Full Cost.
     approvals, route surveys, and
     transportation security devices (including
     immobilization devices).
11. Review of standardized spent fuel            Full Cost.
 facilities.
12. Special projects:
    Including approvals, preapplication/         Full Cost.
     licensing activities, and inspections.
13. A. Spent fuel storage cask Certificate of    Full Cost.
 Compliance.
    B. Inspections related to storage of spent   Full Cost.
     fuel under Sec.   72.210 of this chapter.
14. A. Byproduct, source, or special nuclear     Full Cost.
 material 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  Full Cost.
     associated with unlicensed sites,
     regardless of whether or not the sites
     have been previously licensed. Part 170
     fees for these activities will not be
     charged until July 25, 2006.
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 (fee categories 15.A
     through 15.E).
        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).
            Application--new license, or         $13,900.
             amendment.
        B. Application for export or import of
         nuclear material, including
         radioactive waste, requiring Executive
         Branch review, but not Commission
         review. This category includes
         applications 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         $8,100.
             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 the assistance of the
         Executive Branch to obtain foreign
         government assurances.
            Application--new license, or         $2,600.
             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
         applications 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         $1,700.
             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.
            Minor amendment....................  $320.
        Licenses issued under part 110 of this
         chapter for the import and export only
         of Category 1 and Category 2
         quantities of radioactive material
         listed in Appendix P to part 110 of
         this chapter (fee categories 15.F
         through 15.R).5
Category 1 Exports:
    F. Application for export of Category 1
     materials involving an exceptional
     circumstances review under 10 CFR
     110.42(e)(4).
        Application--new license, or amendment.  $13,900.
    G. Application for export of Category 1
     materials requiring Executive Branch
     review, Commission review, and government
     to government consent.
        Application--new license, or amendment.  $8,100.
    H. Application for export of Category 1
     materials requiring Commission review and
     government to government consent.
        Application--new license, or amendment.  $5,100.
    I. Application for export of Category 1
     material requiring government to
     government consent.
        Application--new license, or amendment.  $4,300.
Category 2 Exports:
    J. Application for export of Category 2
     materials involving an exceptional
     circumstances review under 10 CFR
     110.42(e)(4).
        Application--new license, or amendment.  $13,900.
    K. Applications for export of Category 2
     materials requiring Executive Branch
     review and Commission review.
        Application--new license, or amendment.  $8,100.
    L. Application for the export of Category 2
     materials.
        Application--new license, or amendment.  $3,900.
Category 1 Imports:
    M. Application for the import of Category 1
     material requiring Commission review.
        Application--new license, or amendment.  $4,100.
    N. Application for the import of Category 1
     material.
        Application--new license, or amendment.  $3,400.

[[Page 30751]]

 
Category 2 Imports:
    O. Application for the import of Category 2
     material.
        Application--new license, or amendment.  $3,000.
Category 1 Imports with Agent and Multiple
 Licensees:
    P. Application for the import of Category 1
     material with agent and multiple licensees
     requiring Commission review.
        Application--new license, or amendment.  $4,700.
    Q . Application for the import of Category
     1 material with agent and multiple
     licensees.
        Application--new license, or amendment.  $3,900.
Minor Amendments (Category 1 and 2 Export and
 Imports):
    R. 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 authorities.
        Minor amendment........................  $ 320.
16. Reciprocity:
    Agreement State licensees who conduct
     activities under the reciprocity
     provisions of 10 CFR 150.20.
        Application............................  $1,900.
17. Master materials licenses of broad scope
 issued to Government agencies:
        Application............................  $17,800.
18. Department of Energy
    A. Certificates of Compliance. Evaluation    Full Cost.
     of casks, packages, and shipping
     containers (including spent fuel, high-
     level waste, and other casks, and
     plutonium air packages).
    B. Uranium Mill Tailings Radiation Control   Full Cost.
     Act (UMTRCA) activities.
------------------------------------------------------------------------
\1\ Types of fee--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.
(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\ For a combined import and export license application for material
  listed in Appendix P to part 110 of this chapter, only the higher of
  the two applicable fee amounts must be paid.


[[Page 30752]]

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

0
7. The authority citation for part 171 is revised 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), and as amended by Title 
IV, Pub. L. 109-103, 119 Stat. 2283 (42 U.S.C. 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).


0
8. In Sec.  171.5, the definition of Overhead and general and 
administrative costs is revised to read as follows:


Sec.  171.5  Definitions.

* * * * *
    Overhead and general and administrative costs means:
    (1) The Government benefits for each employee such as leave and 
holidays, retirement and disability benefits, health and life insurance 
costs, and social security costs;
    (2) Travel costs;
    (3) Direct overhead [e.g., supervision and support staff that 
directly support the NRC safety mission areas; administrative support 
costs (e.g., rental of space, equipment, telecommunications and 
supplies)]; and
    (4) Indirect costs that would include, but not be limited to, NRC 
central policy direction, legal and executive management services for 
the Commission and special and independent reviews, investigations, and 
enforcement and appraisal of NRC programs and operations. Some of the 
organizations included, in whole or in part, are the Commissioners, 
Secretary, Executive Director for Operations, General Counsel, 
Congressional and Public Affairs (except for international safety and 
safeguards programs), Inspector General, Investigations, Enforcement, 
Small and Disadvantaged Business Utilization and Civil Rights, the 
Technical Training Center, Advisory Committees on Nuclear Waste and 
Reactor Safeguards, and the Atomic Safety and Licensing Board Panel. 
The Commission views these budgeted costs as support for all its 
regulatory services provided to applicants, licensees, and certificate 
holders, and these costs must be recovered under Public Law 101-508.
* * * * *

0
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 2006 annual fee for each operating power reactor 
which must be collected by September 30, 2006, is $3,704,000.
    (2) The FY 2006 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 2006 spent storage/
reactor decommissioning base annual fee are shown in paragraphs 
(c)(2)(i) and (ii) of this section. The activities comprising the FY 
2006 surcharge are shown in paragraph (d)(1) of this section. The 
activities comprising the FY 2006 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 2006 annual fee for each power reactor holding a 10 
CFR part 50 license that is in a decommissioning or possession only 
status and has spent fuel onsite and each independent spent fuel 
storage 10 CFR part 72 licensee who does not hold a 10 CFR part 50 
license is $173,000.
    (2) The FY 2006 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 2006 surcharge are shown in paragraph (d)(1) of this 
section. The activities comprising the FY 2006 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 2006 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 2006 surcharge allocated to the operating power 
reactor class of licenses is $5.5 million, not including the amount 
allocated to the spent fuel storage/reactor decommissioning class. The 
FY 2006 operating power reactor surcharge to be assessed to each 
operating power reactor is approximately $53,000. This amount is 
calculated by dividing the total operating power reactor surcharge 
($5.5 million) by the number of operating power reactors (104).
    (3) The FY 2006 surcharge allocated to the spent fuel storage/
reactor decommissioning class of licenses is $152,000. The FY 2006 
spent fuel storage/reactor decommissioning surcharge to be assessed to 
each operating power reactor, each power reactor in decommissioning or 
possession only status that has spent fuel onsite, and to each 
independent spent fuel storage 10 CFR part 72 licensee who does not 
hold a 10 CFR part 50 license is approximately $1,200. 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 10 CFR part 
72

[[Page 30753]]

licensees who do not hold a 10 CFR part 50 license.
    (e) The FY 2006 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--$80,100.
Test reactor--$80,100.
0
10. In Sec.  171.16, the section heading and paragraph (d) 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.

* * * * *
    (d) The FY 2006 annual fees are comprised of a base annual fee and 
an additional charge (surcharge). The activities comprising the FY 2006 
surcharge are shown for convenience in paragraph (e) of this section. 
The FY 2006 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\1\
             Category of materials licenses                   \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          $5,420,000
         Enriched Uranium)..............................
        (b) Low Enriched Uranium in Dispersible Form           1,596,000
         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..........         605,000
        (b) Gas centrifuge enrichment demonstration              991,000
         facilities.....................................
        (c) Hot cell facilities.........................         440,000
    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                  2,500
     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,                6,900
     except licenses authorizing special nuclear
     material in unsealed form in combination that would
     constitute a critical quantity, as defined in Sec.
      150.11 of this chapter, for which the licensee
     shall pay the same fees as those for Category
     1.A.(2)............................................
    E. Licenses or certificates for the operation of a         3,027,000
     uranium enrichment facility........................
2. Source material:
    A. (1) Licenses for possession and use of source           1,046,000
     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\......................          65,900
        (b) Class II facilities \4\.....................          65,900
        (c) Other facilities \4\........................          95,900
    (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          65,900
     material, as defined in Section 11e.(2) of the
     Atomic Energy Act, from other persons for
     possession and disposal incidental to the disposal
     of the uranium waste tailings generated by the
     licensee's milling operations, except those
     licenses subject to the fees in Category 2A(2).....
    B. Licenses that authorize only the possession, use              890
     and/or installation of source material for
     shielding..........................................
    C. All other source material licenses...............          14,800
3. Byproduct material:
    A. Licenses of broad scope for possession and use of          28,900
     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                    9,400
     byproduct material issued under part 30 of this
     chapter for processing or manufacturing of items
     containing byproduct material for commercial
     distribution.......................................
    C. Licenses issued under Sec.  Sec.   32.72 and/or            11,600
     32.74 of this chapter authorizing the processing or
     manufacturing and distribution or redistribution of
     radiopharmaceuticals, generators, reagent kits and/
     or sources and devices containing byproduct
     material. This category also includes the
     possession and use of source material for shielding
     authorized under part 40 of this chapter when
     included on the same license. This category does
     not apply to licenses issued to nonprofit
     educational institutions whose processing or
     manufacturing is exempt under Sec.   171.11(a)(1).
     These licenses are covered by fee under Category 3D
    D. Licenses and approvals issued under Sec.  Sec.              6,600
     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                4,800
     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                8,600
     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...................

[[Page 30754]]

 
    G. Licenses for possession and use of 10,000 curies           31,100
     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              19,300
     this chapter to distribute items containing
     byproduct material that require device review to
     persons exempt from the licensing requirements of
     part 30 of this chapter, except specific licenses
     authorizing redistribution of items that have been
     authorized for distribution to persons exempt from
     the licensing requirements of part 30 of this
     chapter............................................
    I. Licenses issued under Subpart A of part 32 of              11,700
     this chapter to distribute items containing
     byproduct material or quantities of byproduct
     material that do not require device evaluation to
     persons exempt from the licensing requirements of
     part 30 of this chapter, except for specific
     licenses authorizing redistribution of items that
     have been authorized for distribution to persons
     exempt from the licensing requirements of part 30
     of this chapter....................................
    J. Licenses issued under Subpart B of part 32 of               3,200
     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 32 of               1,900
     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          16,400
     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                    6,900
     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                  7,300
     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               15,400
     material issued under part 34 of this chapter for
     industrial radiography operations. This category
     also includes the possession and use of source
     material for shielding authorized under part 40 of
     this chapter when authorized on the same license...
    P. All other specific byproduct material licenses,             2,900
     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           12,900
     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            9,700
     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                4,800
     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          27,400
     items contaminated with byproduct material, source
     material, or special nuclear material..............
7. Medical licenses:
    A. Licenses issued under parts 30, 35, 40, and 70 of          15,100
     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                  33,000
     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           6,000
     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                1,900
     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          25,700
     devices or products containing byproduct material,
     source material, or special nuclear material,
     except reactor fuel devices, for commercial
     distribution.......................................

[[Page 30755]]

 
    B. Registrations issued for the safety evaluation of          25,700
     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           2,900
     sealed sources containing byproduct material,
     source material, or special nuclear material,
     except reactor fuel, for commercial distribution...
    D. Registrations issued for the safety evaluation of           1,000
     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........................         \6\ N/A
        2. Users........................................         \6\ N/A
    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..........................           8 N/A
16. Reciprocity.........................................           8 N/A
17. Master materials licenses of broad scope issued to           373,000
 Government agencies....................................
18. Department of Energy:
    A. Certificates of Compliance.......................    10 1,285,000
    B. Uranium Mill Tailings Radiation Control Act               732,000
     (UMTRCA) activities................................
------------------------------------------------------------------------
1 Annual fees will be assessed based on whether a licensee held a valid
  license with the NRC authorizing possession and use of radioactive
  material during the 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, 2006, and permanently ceased licensed activities
  entirely by September 30, 2006. 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 Categories 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 related Quality Assurance program
  approvals, 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.

* * * * *
0
11. In Sec.  171.19 paragraphs (b) and (d) are revised to read as 
follows:


Sec.  171.19  Payment.

* * * * *
    (b) Annual fees in the amount of $100,000 or more and described in 
the Federal Register document issued under Sec.  171.13, must be paid 
in quarterly installments of 25 percent as billed by the NRC. The 
quarters begin on October 1, January 1, April 1, and July 1 of each 
fiscal year. The NRC will adjust the fourth quarterly invoice to 
recover the full amount of the revised annual fee. If the amounts 
collected in the first three quarters exceed the

[[Page 30756]]

amount of the revised annual fee, the overpayment will be refunded. 
Licensees whose annual fee for the previous fiscal year was less than 
$100,000 (billed on the anniversary date of the license), and whose 
revised annual fee for the current fiscal year is $100,000 or greater 
(subject to quarterly billing), will be issued a bill upon publication 
of the final rule for the full amount of the revised annual fee for the 
current fiscal year, less any payments received for the current fiscal 
year based on the anniversary date billing process.
* * * * *
    (d) Annual fees of less than $100,000 must be paid as billed by the 
NRC. Materials license annual fees that are less than $100,000 are 
billed on the anniversary date of the license. The materials licensees 
that are billed on the anniversary date of the license are those 
covered by fee categories 1C, 1D, 2A(2) Other Facilities, 2A(3), 2A(4), 
2B, 2C, 3A through 3P, and 4B through 9D.
* * * * *

    Dated at Rockville, Maryland, this 16th day of May, 2006.
    For the Nuclear Regulatory Commission.
Jesse L. Funches,
Chief Financial Officer.

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



Appendix A to this Final Rule

Final 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 final rule are 
based on the NRC's size standards.
    From FY 1991 through FY 2000, the Omnibus Budget Reconciliation 
Act (OBRA-90) (Pub. L. 101-508), 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 (Pub. L. 106-377) 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 was 90 percent in FY 2005. The FY 2006 
Energy and Water Development Appropriations Act (Pub. L. 109-103) 
extended this 90 percent fee recovery requirement through FY 2006. 
As a result, the NRC is required to recover approximately 90 percent 
of its FY 2006 budget authority, less the amounts appropriated from 
the Nuclear Waste Fund (NWF) and for Waste Incidental to 
Reprocessing (WIR) activities, through fees. The total amount NRC is 
required to recover in fees for FY 2006 is approximately $624.0 
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.
    The Commission is rebaselining its part 171 annual fees in FY 
2006. Rebaselining fees results in increased annual fees for all 
licensees, with the exception of certain fuel facilities.
    The Congressional Review Act of 1996 is intended to reduce 
regulatory burdens imposed by Federal agencies on small businesses, 
nonprofit organizations, and governmental jurisdictions. This Act 
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. The Congressional Review Act also requires that an agency 
prepare a guide to assist small entities in complying with each rule 
for which a final RFA is prepared. This RFA and the small entity 
compliance guide (Attachment 1) have been prepared for the FY 2006 
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. In FY 2005, about 26 percent of 
these licensees (approximately 1,200 licensees) requested small 
entity certification.
    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.
    Over 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

[[Page 30757]]

constitutes a significant economic impact on a small entity; 
therefore, the NRC has no benchmark to assist it in determining the 
amount or the percent of gross receipts that should be charged to a 
small entity. In developing the maximum small entity annual fee in 
FY 1991, the NRC examined its 10 CFR part 170 licensing and 
inspection fees and Agreement State fees for those fee categories 
which were expected to have a substantial number of small entities. 
Six Agreement States (Washington, Texas, Illinois, Nebraska, New 
York, and Utah), were used as benchmarks in the establishment of the 
maximum small entity annual fee in 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 stated in the RFA 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 Chief Financial Officer's Act. Accordingly, the NRC examined 
the small entity fees again in FY 2003 (68 FR 36714; June 18, 2003), 
and determined that a change was not warranted to the small entity 
fees established in FY 2003.
    The NRC again 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 retained the $2,300 small entity annual fee 
and the $500 lower tier small entity annual fee for FY 2005, and is 
not changing these fees in FY 2006. 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 2006.

Attachment 1 to Appendix A--U.S. Nuclear Regulatory Commission

Small Entity Compliance Guide, Fiscal Year 2006

Contents

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

Introduction

    The Congressional Review Act of 1996 (CRA) 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 the CRA. Therefore, 
in compliance with the law, this guide has been prepared to assist 
NRC materials licensees in complying with the FY 2006 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 2006 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 
(listed in 10 CFR 2.810) 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

[[Page 30758]]

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 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.
---------------------------------------------------------------------------

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

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 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

[[Page 30759]]

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. 06-4815 Filed 5-26-06; 8:45 am]
BILLING CODE 7590-01-P