Re: Finacial Assurance and Agreement States

["Rad. Health Unit"<raldrich@emi.com>]

To: All Radsafers

	The following message has been previously posted twice on Radsafe 
without the attached letter from Rita Aldrich to the NRC. My apologies for the 
repetition, but we think the issue warrants another attempt:
 
>	Charles Gallegher's assertion that Agreement State licensees are not 
>provided an opportunity to comment on proposed regs is not true in New York. 
>This State has very strict procedures which afford the public the opportunity 
>to comment on all proposed new regulations. The process is time consuming and 
>costly to taxpayers.
>	The problem is that the Agreement States are asked (if they are asked) 
>to submit comments to NRC proposed regs within very short time frames: 
>typically a few weeks. Rarely enough time to read and digest lengthy and 
>complex proposals. (Note that NRC has a sizable staff dedicated to doing 
>nothing other than generate new regulations, whereas very few state programs 
>have this luxury.) When comments are submitted they are typically ignored and 
>states are required to adopt whatever NRC decides on.
>	With regard to Financial Assurance, the attached comments were submitted 
>by the NYS Dept. of Labor in April of 1995, and repeated comments made to NRC 
>in March of 1994 on essential flaws in its regulatory impact analysis for the 
>initial rule. NO response was received to the 1995 letter and no changes were 
>made by NRC in the final rule.

				<Attachment>
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                                                 April 19, 1995



Secretary of the Commission
United States Nuclear Regulatory Commission
Washington, D.C.  20555-0001

ATTN:     Docketing & Services Branch

Dear Sirs:

     This letter is in reference to SECY 95-043, Final Rule on "Clarification of 
Decommissioning Funding Assurance Requirements" (SP-95-063).  The referenced 
document requested comments from the Agreement States on a final rule amending 
NRC's financial assurance for decommissioning requirements.  

     We note that this document describes NRC-Agreement State interactions on 
this rulemaking as consisting of a discussion of the proposed rule at the 1993 
NRC-Agreement States meeting.  It is further stated that "because of the minor 
nature of the rulemaking" the draft final rule was not sent to the Agreement 
States for comment.  Yet, NRC is assigning a "level 2" compatibility requirement 
to the rule, which means that the Agreement States must adopt it essentially as 
written, with latitude only to be more stringent.  This is in spite of the fact 
that the only comment received by NRC from the Agreement States on the proposed 
rule was that it be assigned a level 3 or 4 compatibility, which would give the 
States latitude to accomplish the rule's intent by other means.  This could 
consist of licensing action, for example, which would avoid consuming staff time 
and the public's money, on a rulemaking that NRC concedes is minor in nature.  
In the spirit of federal-state cooperation, the Agreement States' comment should 
be respected by NRC and the rule should be assigned a level 4 compatibility 
rating.

     However, a far more important issue is that the "SECY" paper continues a 
factual error that was contained in the original regulatory analysis for the 
rule being amended, and which invalidates the certification that either 
rulemaking does not have a significant economic impact on a substantial number 
of small entities.  We brought this error to NRC's attention in a letter dated 
March 11, 1994, and a copy is attached as a part of these comments.
                               -2-




     NRC stated in the regulatory impact analysis for the original rule that 
small entities would be able to obtain financial instruments, such as bonds or 
letters of credit, to assure financing for eventual decommissioning, at an 
annual cost of one to two percent of the face value of the instrument.  It was 
also stated that this was the assurance mechanism that small entities would be 
expected to use, since it was less expensive than prepayment, for example.  As 
our letter pointed out, this was erroneous. Small entities are being required to 
fully collateralize such financial instruments, which amounts to prepayment.  
Also, the premises for which financial assurance for decontamination and 
decommissioning is being sought, will obviously not be accepted as collateral, 
and this is often a small entity's principal asset.

     This rulemaking should not proceed without correcting this error and 
developing a revised, realistic regulatory impact analysis.



                                        Sincerely,



                                        Rita Aldrich
                                        Principal Radiophysicist

				<End of Attachment>
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Clayton J. Bradt                       	| 	voice: 518-457-1202
Assoc. Radiophysicist                   |	fax:   518-457-5545
NYS DOL					|
"Rad. Health Unit"<raldrich@emi.com>	|
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