ML20055H808
| ML20055H808 | |
| Person / Time | |
|---|---|
| Site: | Rancho Seco |
| Issue date: | 07/24/1990 |
| From: | Keuter D SACRAMENTO MUNICIPAL UTILITY DISTRICT |
| To: | Larkins J NRC OFFICE OF INFORMATION RESOURCES MANAGEMENT (IRM) |
| References | |
| AGM-NUC-90-144, NUDOCS 9007300116 | |
| Download: ML20055H808 (53) | |
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lJSMUD SACRAMENTO MUNICIPAL UTILITY DISTRICT C 6201 S Street, P.o. Box 16830. Secremento CA 958521830.(916) 452 3211
- AN ELECTRIC SYSTEM SERVING THE HEART OF CALIFORNIA AGM/NUC 90-144 R
. July 24,1990 "U. S.: Nuclear Regulatory' Commission
-Attn:: Document Control Desk.
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. Washington, DC 20555; E
- Docket No~. 50-312-1 Rancho Seco Nuclear Generating; Station
~ License No. DPR DECO MISSIONING FINANCIAL PLAN AND INTERIM EXEMPTION REQUEST FROM CERTAIN
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-REQUIREMENTS OF 10 CFR 50.75(e)(1)(ii)
Attention: John Larkins In-accordance with the requirements-of 10 CFR 50.33(k)(2) the District hereby 3~
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submits the Decommissioning Financial Plan for the Rancho Seco Nuclear l-Generating Station.
The financial assurance funding method chosen by the District to meet the requirements of 10.CFR 50.75(e) is an external sinking fund.~ supplemented. by annual deposits.
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H The external' funding will _be performed in accordance with the Financial Assurance Plan (Attachment 2).
In'1991, the District will make an initial
. deposit of $55 million into the Trust Fund established by the Trust Fund Agreement (Attachment 3). -The District will make annual additions sufficient
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to meet the requirements of the Decommissioning Financial Plan.
k Because of a-public vote on. June 6,1989, the District shut down Rancho Seco.
-Due to this shutdown _ prior to the expiration of the operating license, the:
. District cannot meet the requirement to have full decommissioning funding at
'the time:of the termination of operation.
Accordingly, pursuant to 10
'R 50.12, the District hereby requests an interim 4'
exemption regarding the requirement to have full decommissioning funding at the time of the termination of operation. After the selection ^f-a
' decommissioning. option and the NRC's approval of the'preposed D, commissioning p
. Plan, the District will submit a revised Decommissioning Financial Plan.
The
. updated financial. plan will be based on site-specific cost estimates which consider the decommissioning option chosen and major technical factors affecting decommissioning activities.
' provides the bases for the District's request for an exemption t
l from.10 CFR 50.75(e)(1)(ii). Attachment 2 is a copy of the Financial 4
Assurance Plan and Attachment 3 is a copy of the Decommissioning Trust Fund
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' Agreement.
9007300116 900724 i
ADOCK0500g2 PDR 4001 RANCHO SECo NUCLEAR GENERATING STATION O 14440 Twin Cities Road, Herald, CA 95638 9799;(209) 333 2935 i
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John L&rkins-AGM/NUC 90-144-Members of your staff with questions requiring additional information or m
clarification may contact Mr.' Jerry Delezenski at (209) 333-2935.. extension 4914.
State of California SS County of Sacramento Dan R. Keuter, being first duly sworn, deposes and says:
that he is Assistant General Manager, Nuclear of Sacramento Municipal Utility. District (SMUD), the licensee herein; that he has executed the foregoing document; that the statements made in this document are true and correct to the best of his knowledge, information, and belief, and that he is authorized to execute this document on behalf of said licensee.
[
Dan R. Keuter; 7
Assistant General Manager Nuclear Subst-ibedandaffirmedtobeforemeonthis8 day ofk M T 1990.
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L oppion, seal Debbie Brenner "
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Notary Public L
DESSE R.ORENNER abcouwn :;
j Attachment news mme K
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J. B. Martin, NRC, Halnut Creek
-C. Myers, NRC, Rancho Seco S. Reynolds, NRC, Rockville
v Page 1 of'S ATTACHMENT 1 EXEMPTION REOUEST - 10 CFR 50.75(e)(1)(ii)
Regulatory Reauirementi
'10 CFR 50.75(e)(1)(ii) provides the definition of the external sinking fund-financial assurance method,- and states that "...the total amount of funds would be sufficient to pay decommissioning costs at the time termination of
' operation is expected." As described in the Decomissioning Financial Plan, n
the District has chosen to use an external sinking fund as its financial assurance method.
The' goal of the-Commission's financial assurance provisions in the decommissioning regulations adopted in 1988, is to provide reasonable assurance that funds will be available to decommission facilities in a timely manner which protects the public health and safety. -See 10 CFR 50.75(a');
L 53 Fed.1 Reg. 24,018 (1988). The NRC adopted a step-wise procedure to provide l
this assurance.
First, licensees are to certify, in reports due on or before July 26, 1990, that financial assurance for decommissioning will be provided in at least a minimum amount set by the NRC, with provisions for adjustments over the reactor's operating life.
The sere.d step is that licensees must submit, five years prior to the expected end of operations, a. cost estimate for decommissioning based on an up-to-date assessment of the actions necessary.
for decommissioning and plans for adjusting levels of funds assured for decommissioning. The third step is a licensee evaluation of specific decommissioning provisions close to the commencement of decommissioning.
-In the statement of considerations which accompanied the decommissioning regulations in 1988, the Commission stated:
Combination of these steps, first establishing a general level of adequate financial responsibility for i;
decommissioning early in life, followed by periodic adjustment, and then evaluation of specific provisions close to the time of decommissioning, will provide reasonable assurance that the Commission's objective is met; namely, that at the-time of permanent end of operations, sufficient funds are available to decommission the facility in a manner which protects public health-and safety. More detailed consideration by NRC early in life beyond the certification is not considered necessary because of the steps discussed above.
53 Fed. Reg, at 24,030-31 (1988)'.
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Exemotion Reauested 1
Th'e District requests an exemption from the provisions of 10 CFR 50.75(e)(1)(ii) which require that an external sinking fund contain i
funds-sufficignt-to pay decommissioning costs at the termination of operations. l' This is a schedular exemption only.
The District will-
- fund the costs 'of decommissinning the Rancho Seco Nuclear Generating Station-as described in its Financial Assurance plan.
Exemotion Criteria The criteria for exemptions from the requirements of 10 CFR Part 50 are in m
Section 50.12." Specific Exemptions." The NRC may grant exemptions from-Part 50 regulations if special circumstances are present and an undue risk will not be presented to the public health and safety.- In the discussion below of the basis for this exemption request, the District will address the following sections of 10 CFR 50.12(a)(2):
(ii) ~ Application of the regulation in the particular circumstances would not serve the underlying 1
purpose of the rule or is not necessary to achieve the underlying purpose of the rule; (iii) Compliance would result in undue hardship or other costs that are significantly in excess of those contemplated when the rule was adopted...;
(vi) There is present any other material circumstance not considered when the regulation was adopted for which it would be in the public interest to grant an exemption.
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The District recognizes that where completion of decommissioning is i
delayed by a period of storage or long-term surveillance, funds needed to complete decommissioning must be placed into an account segregated from licensee assets and outside licensee's administrative 1
control during the storage or surveillance period.
10 CFR 50.82(c)(1). When the District is prepared to file its proposed decommissioning plan, it is likely that a storage period will be proposed and that the District will find it necessary to request, at that point, an exemption from the apparent requirement that decommissioning funds be accumulated at the outset of the storage period.
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Basis for the Exemotion-
.The NRC issued an operating license for Rancho Seco in August 1974, and the plant went-into commercial operation in April 1975.
The current operating license is scheduled to expire on midnight, October 11, 2008.
However, as a result of a public referenJum of the District's voters on June 6, 1989, Rancho j
Seco has ceased operations.
Even though it had not been required by NRC regulations,: the District has been contributing to a decomissioning fund for Rancho Seco for many years. As a result, as described in the District's
-report on Financial Assurance, an initial payment of approximately $55 million will be made-to the external sinking fund being established pursuant to NRC regulations. While this represents a very significant beginning for the Rancho Seco decommissioning fund under NRC requirements, it'does not constitute sufficient funds to decommission the facility at this time, as contemplated by 10 CFR 50.75(e)(1)(ii).
(As described in the District's
-Financial Assurance plan, if the District used the guidance in 10 CFR 50.75(c), the minimum assurance level fer decommissioning a reactor the size of Rancho Seco (2772 MHT) would be about $113 million.) The District did j
not~ anticipate the premature closure of the facility in 1989, some 19 years
-before-its license would have expired, without any extensions.
As discussed above, the decommissioning regulations adopted by the NRC.
contemplate that licensees should have at least the period of their reactors'-
J coperating lives in which to accumu' late decommissioning funds.
Several-commenters on the Commission's proposed & commissioning rule preferred the use of prepayment of the funds, rather than a method which accumulates funds over J
projected reactor life or until decommissioning begins.
Principal' reasons for
. favoring prepayment included the fact that there may be shutdown of a reactor.
before.the date of its expected end of life due to either an accident or
. problems with reactor aging or obsolescence.
53 Fed. Reg. at 24,033 (1988).
In response, the Commission stated as follows:
.An important consideration in selecting an acceptable method for providing funds for decommissioning is that l
the method be reasonably cost effective. Prepayment of 5
funds has been recognized by several studies.as being significantly more costly than the other methods.
In
. view of tne unlikely nature of the events and the potential problems being considered, prepayment generally has a cost too high-for the benefit that would be realized.
53 Fed. Reg. at 24,034 (1988); NUREG-1221, at D-25.1/
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NRC Office of Nuclear Regulatory Research (June 1988), " Summary, Analysis and Response for Public Comments on Proposed Amendments to 10 CFR Parts 30, 40, 50, 51, 70 and 72:
Decommissioning Criteria for Nuclear Facilities."
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j Thus, the Commission recognized the possibility of premature closures, but decided that;the excessive costs of prepayment were not justified.
Reasonable cost effectivene;a was recognized as an important ingredient in the flexibility allowed by the NRC in the selection of-funding methods.
-NUREG-1221, at D-16.
Here, where a premature. shutdown has occurred, the-Commission likewise should consider the excessive costs of literal compliance,
. here there~ is no threat to the protection of the public's health and safety.
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Literal compliance with the portion of 10 CFR 50.75(e)(1)(ii) which requires a fully funded external sinking fund at the expected end of operations is not necessary-to achieve the underlying purpose of the rule in these particular circumstances.
The District's Financial Assurance-plan provides reasonable assurance that funds will be available in a timely a
manner for a safe decommissioning of Rancho Seco.
Approximately $55 million already accumulated by the District for plant decommissioning will be deposited into-the external sinking fund established pursuant to NRC regulations.
These funds will be invested and will grow at 8%
per year (or greater). Thus, the fund will grow much faster than any
. reasonable estimate of inflation. And of course the District will continue to L
add to funds in the amount required. The District, a State agency, sets its own retail rates and does not have to rely on outside regulatory bodies-to obtain the funds necessary to decommission the plant.
This provides further assurance that funds will be availtble on a timely basis.
(Hhile the District is in the process of studying and selecting its decommissioning option, it is not expected that immediate dismantlement will be proposed.)
' Literal compliance would also result in undue hardship and costs that are significantly in excess of those contemplated when the rule was adopted.
It does not appear that the Commission meant to force those. licensees who cease operation prematurely to raise the entire amount of required decommissioning funds at the time of shutdown.
See 53 Fed.
Reg. at 24,033;(1988). Completing the decommissioning fund all.at once would result in an extreme financial burden, and would cause severe and undue p
, financial hardship to-the District and its customer-owner ratepayers when the i
funds actually are not needed at the moment to proceed with an orderly closure
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and development of decommissioning plans.
In fact -a requirement to complete the fund immediately could well jeopardize the District's capability to proceed with an orderly and safe closure program.
- There are material circumstances present not considered when the regulation was adopted and for which it would be in the public interest to grant an exemption.
In considering the final decommissioning rule, the NRC assumed that power reactor licensees would be able to accumulate funds over the full operating life of the plant or until needed to pay for decommissioning. As discussed above, the intent of the rule was not to impose upon a licensee which ceased power operation prematurely the requirement to raise the entire amount for decommissioning at the time of shutdown.
Premature closure is a material circumstance not provided for in the rule.
l For all of these reasons, the NRC should grant the District a schedular exemption from the requirements of 10 CFR 50.75(e)(1)(ii).
When the District is able to complete its decommissioning planning and file the proposed plan L
called for by 10 CFR 50.82, alcng with a site-specific cost estimate, a l
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' Attachment 1
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further exemption' request will be submitted to address;10 CFR'50.82(c)(1) and' I
-to propose a funding. accumulation period appropriate to the District's overall decommissioning' plans.
In.that sense.-the-current schedular exemption-request q
may be viewed as. extending-the funding' accumulation period on an interim basis until the NRC acts upon the District's final' proposal.
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i ATTACHMENT'2-J.
, SACRAMENTO MUNICIPAL UTILITY DISTRICT FTNANCIAL ASSURANCE PLAN 4
x FOR THE-1 DECOMMISSIONING OF THE i'
RANCH 0.SEC0 NUCLEAR GENERATING STATION
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fIntroduction The NRC issued an operating license for Rancho Seco in August 1974, and the o
plant went'into commercial operation in April 1975.- The current operating
- license is scheduled to expire on midnight, October. 11, 2008. : However. as a result of;a public referendum of the District's voters on June 6 1989, Rancho p~
Seco has. ceased operations,- Consequently, the District is currently evaluating decommissioning alternatives.
On. lune 27, 1988 the NRC published amendments-to 10 CFR Part 50, establishing.
4 decommissioning rules and requiring financial planning for the decommissioning L.
of nuclear facilities, Additionally, the NRC issued a Regulatory Guide, entitled, " Assuring the Availability of Funds for-the Decommissioning.of Nuclear Reactors" that provides guidance concerning methods acceptable to the NRC staff for complying with the requirements.of the' amended rule.
The-Decomnissioning Rules require the District to submit, on or before July 26, 1990, information indicating how reasonable assurance will be provided that funds ~will be available to decommission Rancho Seco. This report provides that information.
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Financial Assurance Method The District intends to provide financial assurance through the external-sinking fund method by establishing an external trust fund to which the l:
-District will make an initial contribution of $55 million and then make annual i
. contributions. All these contributions will be placed in a trust fund-outside of the District's administrative control pursuant to a trust agreement (Attachment 3). These funds will be segregated from other District assets and provide reasonable assurance that funds will be available to decommission Rancho Seco, i
3.
Financial Assurance Plan Since decommissioning planning for Rancho Seco is currently incomplete and a final decommissioning alternative has not been selected, the District will employ a two-phase approach to financial planning.
For phase one, the District will use a decommissioning cost estimate which has been calculated
- based on the. certification formula.
Currently, TLG Engineering is conducting a site-specific study to evaluate decommissioning alternatives and determine the most acceptable option. Once IJ the District has selected a decommissioning alternative and the NRC has approved the decommissioning plan, phase two of financial planning will be implemented. At phase two, the District will submit a revised financial plan o
reflecting site-specific decommissiening costs.
4.
Decommissioning Method Although decommissioning alternatives are still under evaluation, this lc financial assurance report assumes funding based on a delayed decommissioning i
method.
1 Attachment'2-Page 2 of.3 5.-
Decommissioning Cost Estimate -
The Decommissioning Rule, 10 CFR 50.75(b), states that at its discretion, an r
electric utility may submit a certification based on either the formula provided in paragraph 50.75(c)(1) or. on a-site-specific cost estimate..Until' such-time as a site-specific decommissioning plan for Rancho Seco is completed and approved, the District will use a decommissioning cost estimate that has
- been calculated = based on the certification formula (see Table 3).
6.
Adjustments to Cost Estimate Hhen TLG Engineering completes the site-specific study and upon management approval, the District will adjust the cost estimate to conform to the study findings.
In the future, adjustments for inflation will be calculated every year using Handy-Hhitman Construction Cost Indices.
The projected icng-term
- levelized inflation rate will use indices' published by the Hharton Econometric
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Forecasting Associates (see Table 2). Other nationally recognized indices may-be used or substituted for the above.
The District will review and modify its Lannual funding level'at-least every five years to reflect inflation, technological changes, and other factors that may impact decommissioning costs.
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Trust Fund Contributions Initial Contribution - On-or before July 26, 1991, the District will deposit an initial lump sum of $55.0 million into the trust fund which will then be beyond;the District's right to remove the money.
Annual Contributions - Starting in 1992,.the. District will make a contribution L
of approximately $2 million annually.
The annual amount will be revised, as I
necessary to reflect the site-specific cost estimate.
t Certification Amount - NRC regulation 10 CFR 50.75(c) discusses the minimum amounts required toLdemonstrate reasonable assurance of funds available for decommissioning by reactor type and power level.
For Rancho Seco, TLG Engineering calculated the certification amount to be-$112.88 million (see Table 3).- Based on an initial contribution of $55 million and subsequent-annual contributions of $2 million, the District would more than fulfill the -
certification amount by the year 2007 (see Table 1 Page 2).
He make these contributions for now reserving the right to seek a different funding pattern g
based on the Final Decommissioning Plan.
8.
Investments
' The District will employ a decommissioning trust fund investment policy that.
will satisfy NRC concerns about administrative control and speculative investments.
Firstly, all District investments must conform with California State law criteria that restricts the investment of public monies to a list of authorized investments.
Secondly, the District's trust fund investments will be primarily U.S. Treasury and Government Agency securities. Although these I
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investments will be self-directed, the securities will be' purchased with a-
' " buy and hold to maturity" philosophy.. The District intends to abide by these j
couservative investment standards and not involve itself with the day-to-day.
Linvestment'of decommissioning trust funds. He expect these funds to earn 5
. interest at 8% or higher.
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. Conclusion This financial assurance plan is submitted in compliance with the amended Decommissioning Rules,10 CFR Part 50, requiring financial planning-for the
.)
decommissioning of nuclear facilities.
This report provides financial
.i assurance by specifying the amount of funds needed for decommissioning
($112.88 million) and by establishing a decommissioning trust ~ fund as the U
method used for said purpose.
This plan will remain in effect until revised-i
- to reflect an approved decommissioning plan.
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1 TABLE 1
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DECOMMISSIONING COSTS
($000) i i.
- Escalation Discount 1990-Index 9 Escalated Rate 9 Discounted 1
Dollars' 1.051 _ _ _
Dollars _
J.083
_Cashfloy_
4-
,1991.
.0 1.000 0
1.083' 0'
0:
1992
-O'-
1.051~
O' l.173 0
1993 0
1.105 0
1.270
.0' 1994'.
0-1.161 0
-1.376 0-1995 0
1.220 0-1.490 0
1996.
0 1.282 0
1.614.
0 1997-0 1.348~
0 1.747 0
1998 0
1.417 0
l'.892 0
u
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1999-
'O 1.489' 0
2.050
~0
'2000--
.0:
1.565 0
2.220 0
',2001' 10-1.644 0
2.404 0'
2002 0-1.728 0
2.603 0'
s
.2003, 0
1.816 0
2.819-0 2004 0.
1.909 0
3.054 0
.2005=
0 2.006 0:
3.307-01 2006' 0
2.109.
0 3.581 0
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2007 112,880 2.216 250,185 3.879 64,503
-$112,880
$250,185~
$64,503 l
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- See Table 2
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je TABLE 1 Page 2 of 2-DECOMMISSIONING' ACCUMULATION TABLE External Trust ($000)
Beginning-Ending Balance Disbursement Additions Earninas Balance 1991-
$55,000
$0
$0
$4,565
$59,565 1992 59,565 0
2,000 5,110 66,675 1993 66,677 0
2,000 5,700 74,377 1994 74,380 0
2,000 6,340 82,719~
l995 82,722 0
2,000 7,032 91,754 1996 91,756 0
2,000
'7,782 101,538
'1997 101,540 0
2,000 8,594 112,134 1998 112,136 0
2,000 9,473 123,610 3
1999 123,612 0
2,000 10,426 136,038 1
2000 136,040 0
2,000 11,457 149,497 l
2001 149,500 0
2,000 12,574 164,074 2002--
164,077 0
2,000 13,784 179,861 2003
- 179,863 0
2,000 15,095 196,958 2004 196,960 0-2,000 16,514 215.474 6
2005-215,476 0
2,000 18,051 235,527 1
'2006 235,529 0
2,000 19,751 257,244 i
2007 257,246 250,185 2,000 752 9,814
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i 250,185 32,000 172,963
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TABLE 2' FEBRUARY 1990 ECONOMIC OUTLOOK UPDATE
/s YEAR-TO-YEAR ESCALATION RATES 4
FOR NUCLEAR CONSTRUCTION COSTS PACIFIC REGIONL 1
i 1990 4.1 1991 4.6 1992 4.1 6
1993 4.3-1994 4.7
- j-1995 5.0 1996 5.5-1997 5.6 1
1998 5.6
.1999 5.3 R
2000' 5.3 2001 5.3 i
2002 5.4 2
2003 5.5 2004 5.5 2005' 5.5 2006 5.5 2007 5.5 2008 5.5 2009' 5.5
. LEVELIZED RATE FOR:
FIVE YEARS
'4.3 TEN' YEARS 4.9 4
y THENTY YEARS 5.1
' Source:
Hharton Econometric Forecasting Associates
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y TABLE 3' PLANT NAME: Rancho Seco Nucle.r Generating Station -
- TLG Engineering. Inc.
UTILITY NAME: Sacramento Municipal Utility District ESCALATION OF DECONi!SSIONING COSTS FOR
' PRESSURIZED WATER REACTOR (PWR) ONLY JAN'JARY 1986 TO JAN' ARY 1990
- Escalation Factors J
Economic Indicators' 86 to 87 86 to 88 86 to 89 86 to 90 Empisyment Cost Index Dec 85 Dec 86 Dec 87 Dec 88 Dec 89 Dec 85/Dec 86 Dec 85/Dec 87 Dec 85/Dec 88 Dec 85/Dec 89-l West
'129.8 132.8 136.3 141.5 147.5 1.02 1.05 1.09
'1.14
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Industrial Power (electric)
Jan 86 Jan 87 Jan 88 Jan 89 Jan 90 Jan 86/Jan 87 Jan 86/Jan 88 Jan 86/Jan 89
'Jan 86/Jan 90 Pacific 112.2 100.2 98.2 106.3 119.0 0.89 0.88 0.95 1.06 Light O el Oils Jan 86
'Jan 87 Jan 88 Jan 89 Jan 90 Jan 86/Jan 87 Jan 86/Jan 88 Jan 86/Jan 89 Jan 86/Jan 90 Licht Fuel Oils 82.0 51.4 54.8 54.9 85.:s 0.63 0.67 0.67 1.04 Energy Escalation (Pacific)
Jan 86/Jan 87 Jan 86/Jan 88 Jan 86/Jan 89
'Jan 86/Jan 90 PWR (.58 P +.42F) 0.78 0.79 0.83 1.05 Burial Cost (NRC) PWR Jan 86 Jan 87 Jan 88 Jan 89 Jan 90 Jan 86/Jan 87 Jan 86/Jan 88 Jan 86/Jan 89 Jan 86/Jan 90 W+shinoton 1.000 N/A 1.183 N/A N/A N/A 1.183 N/A N/A (West, Pacific, Washington)
NRC Minimum Cost Escalated Values in Millions of Dollars MWt (1/86 fe dollars)
(1987)
(1988)
(1989)
(1990) l RANCHO SECO NUCLEAR l GENERATING STATION 2772
$99.39 Millions
$102.06
$103.90
$107.03
$112.88 1
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NRC MINIMUM COST (1/86 MM dollars) Formula:
INDUSTRIAL POWER (electric) Formula:
-(WASHINGTON 1986 TO WASHINGTON 1988)
P=2772 MWt.......$(75 + 0.0088
- P)
Jan 90 / Jan 86 = Jan 85 to Jan 90 BURIAL COST (NRC) Formula:
l P=2772 MWt.......$(75 + 0.008a
- 2772) = 99.39 119.0 / 112.2 = 1.06 (1986 $ Cost) = [1986 $ 99.39]
P = 1.06 Jan 88(WS) / Jan 85(WS) = Jan 86(WS) to Jan 88(WS) 1.183 / 1.000 - 1.183 LIGHT FUEL OIL Formula:
Bx = 1.183 EMPLOYMENT COST INDEX Formula:
1.183 / 1.000 = 1.183 Jan 90 / Jan 86 = Jan 86 to Jan 90 Ex = 1.183 Dec 89 / Dec 85 = Dec 85 to Dec 89 85.3 /
82.0 = 1.04 147.5 / 129.8 = 1.14 F = 1.04 Lx = 1.14 Estimated Cost (Year 1990) = [1986 $ Cost) [A Lx+B Ex+C Ex]
Energy (PWR) = (.58 P +.42 F)
Estimated Cost (Year 1990) =
(.58
- 1.06 +.42
- 1.04) = 1.05
[1986 $ 99.39] [(0.65)(1.14)+(0.13)(1.05)+(0.22)(1.'83)]
- Ex = 1.05 -
Estimated Cost (Year 1990) = $112.88 Millions b.
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REFERENCE:
1)
Employment Cost Index,- is from the MONTHLY LABOR REVIEW U.S. Department of Labor Bureau of Labor Statistics, April 1990
- Table 24, Employment Cost Index,' private nonfarm workers, Compensation, Worker by Region, WEST.
2)
Industrial Power (electric)/ Light Fuel Oils is from the PRODUCER PRICE INDEXES U.S. Department of Labor, Bureau of Labor Statistics,' Jan 1990 TABLE No. 6, Commodity group Code 0543-1927 for industrial power by region PACIFIC.
TABLE No. 6, Commodity group Code 0573 for light fuel oils (Light fuel oils Code 0573).
The two indices werc combined using the following formula: PWR Energy =.58 P + 0.42 F. P = Power (electric) F = Fuel 011.
3s
- "-ial Coe'. (NRC), is from U.S. Nuclear Regulatory Connission, NUREG-1307 REV.1, Report on Waste Burial Charges, October 1989 TABLE 2.1, PWR l
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.,s Di! 10 fi ATTACHMENT 3' 1
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t SACRAMENTO MUNICIPAL UTILITY DISTRICT DECOMMISSIONING TRUST FUND AGREEMENT FOR THE RANCHO SECO NUCLEAR GENERATING STATION Y
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Sacramento Municipal' Utility District-TABLE OF CONTENTS I
Article Title Page ARTICLE I
. DEFINITIONS.........................
-3 t
1.01 Definitions.........................
3
-ARTICLE II:
THE ESTABLISHMENT OF THE TRUST AND l
APPLICATION OF THE FUND...........
7 2.01 Resolution..........................
7 2.02 Establishment of Trust and Fund.....
8 2.03 Deposits Into Fund..................
8 2.04 Application of the Fund.............
9 2.05 Limited-Use.........................
13 2.06 Grantor Trust................
13 2.07 Domestic Trust......................
14 ARTICLE III:
CONCERNING THE TRUSTEE..............
-14 3.01 Investments.........................
14 3.02 Investment Asthority................
14 3.03 Annual Accounting...................
16 3.04 Compensation of Trustee.............
18' 3.05 Standard of Care....................
19 3.06 Indemnity...........................-
20 3.07 Maintenance of Office...............
21 3.08 Resignation or Removal of Trustee...
22 s
n 3.09 Successor Trustee...................
23 ARTICLE IV:
MISCELLANEOUS.......................
24 L
4.01 Disposition of Assets...............
.24 L
4.02 Effective Date......................
25 4.03 Termination.........................
25 4.04 Successors and Assigns...............
26 4.05 Severability........................
27 4.06 Entire Agreement....................
27 l
4 07 Notices.............................
27 L
4.08 Headings............................
29 l
4.09 Representations.....................
29 4.10
' Counterparts........................
30 4.11 Governing Law.......................
30 l
4.12 No Additional Duties......
30 l
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. EXHIBIT-1 DESCRIPTION:OF SECURITIES
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- t EXHIBIT 2' WITHDRAWAL CERTIFICATE t
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.5 DECOMMISSIONING TRUST FUND AGREEMENT' l
This Decommissioning Trust Fund Agreement (the.
" Agreement"), dated as of July 19 1990, by and between
-Sacramento Municipal. Utility District (the " District"), a politica1Lsubdivision of the State of California, and-Bankers Trust Company, a New York banking corporation doing business by virtue of the laws of the United' States of America with its principal place of business in New York City, New York, as the decommissioning trust fund trustee (the " Trustee");
WIINEgEEIH:
i WHEREAS, the District owns the Rancho Seco Nuclear.
Generating Station-(" Rancho Seco"); and l
WHEREAS, Rancho seco is licensed by the Nuclear i
Regulatory Commission (the "NRC") ; and WHEREAS, the District has elected to establish a i
decommissioning trust (the " Trust") into which it shall contribute certain amounts in order to provide a source of L
funds for the future decommissioning (" Decommissioning") of s
Rancho Seco; and WHEREAS, NRC regulations 10 C.F.R. Part 50, as amended from time to time, require the District to provide assurance that adequate funds will be available; and..
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WHEREAS, the District desires to establish a fund
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(the " Fund") within such~ trust as a mechanism for'segre-i gating decommissioning funds from other assets owned by the District;--snd I;HEREAS, Resolution Number 90 7-15 was adopted by v.he. Board of Directors of the District on.
July 19
, _1q 90 (the "Resolutien"), which Resolution permits the establishment of the Trust with the Trustee upon the terms and conditions. hereinafter set forth in this Agreement; and s
WHEREAS,'the District desires to appoint Bankers Trust Company to receive, hold and administer all sums of money or other property as shall from time to time be contributed or paid over to it hereunder, IN TRUST.
l NOW, THEREFORE, in consideration of the foregoing and the mutual covenants hereinafter set forth, the parties
-hereto agree as follows:
ARTICLE I DEFINITIONS t
Section 1.01.
Definitions.
In. addition to words and terms elsewhere defined in this Agreement, the following words and terms as used in this Agreement shall have the s
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1 following meanings, unless the context indicates that some J
other meaning is plainly. intended.
Words of masculine gender shall be deemed-and
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construed to include correlative words of the feminine and.
neuter genders.
Words importing the singular number shall include-the plural number and vice versa unless the context shall otherwise indicate.- The word " person" shall include q
s corporations, associations, natural persons and public bodies unless the context shall otherwise indicate.
" Agreement" shall mean this Decommissioning Trust Fund Agreement, dated as of July J_9, 1990, between the l
District and the Trustee, as amended from time to time in L
j accordance-with the terms hereof.
b
" Amortized Book Value" shall mean the sum of all cash, securities at cost, accrued interest and amortization / accretion of premium / discount held in the Fund on a given date.
" Annual Payment" shall mean the aggregate annual amount which the: District shall be required to deposit into the Fund.
" Authorized officer" shall mean, with respect to 1
the District, the General Manager, the Chief Financial e
Officer, the Treasurer, any Assistant Treasurer or any other officer of the District who may be authorized by the 1 '
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- District to perform 1specified activities under this Agreement, the identity of whom shall be certified to the Trustee in accordance with Section 4.07.
" Certification" shall mean written authorization signed by an Authorized Officer submitted to the Trustee at t
three-month intervals, pursuant to Section 2.04(A), for the
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payment of Decommissioning funds from the Fund.
.)
" Certification Amount" shall mean the sum of Prior-Unfunded Expenditures and Future Unfunded Expenditures.
" Compensation Agreement" shall mean a separate written agreement between the District and the Trustee i
setting forth the compensation the Trustee will be paid'for its performance of the services specified in the Agreement.
" Decommissioning" shall mean only those activities related to sufficiently reducing the-residual radioactivity L
of the Plant'to a level that permits release of the property for unrestricted use and termination of the-license.
l
-Decommissioning shall not mean all costs related to other activities which may also be specified in the Decommission-
+
ing' Plan (hereinafter defined), such as site restoration.
All determinations hereunder shall be made by the District.
" Decommissioning Plan" shall mean the plan of decommissioning and other related activities for the Plant, 1
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-approved by the NRC,.as such plan may.be' amended from time to time with the approval of the.NRC.
" District".shall mean the Sacramento Municipal l
Utility District, a body politic and corporate, constituting
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-a public corporation and political subdivision of the State of California.
" Effective Date" shall mean the first day'this Agreement shall commence and become operative, pursuant to Section 4.02.
I
" Financial Assurance Plan" shall mean the funding y
plan associated with providing assurance that sufficient r
funds will be available for the Decommissioning of the 1
Plant,Las such plan may be amended by the-District from time to time in a manner which the District determines is permitted by the NRC.
"First Annual Payment" shall mean the initial deposit in the fund.
" Fund" shall mean-the fund established within the Trust.
" Future Unfunded Expenditures" shall mean all 4
i:
expenditures for Decommissioning purposes, if any, which the District reasonably anticipates it shall incur.-
"NRC" shall mean the United States Nuclear Regu-
.latory commission.or any successor to such entity.
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" Paid Earnings" shall'mean income received on Permitted. Investments.
" Permitted Investments" shall mean any and all investments which-the' District, in its sole discretion, determines are legal investments for the funos of the District under the laws-of the State of California in effect j
1 at the time of such investment.
U
" Plant" shall mean the nominally. rated 913 mega-I watt nuclear generating plant, known as Rancho Seco Nuclear Generating Station,'wuich is located 25 miles southeast of Sacramento,-California.
rPrior Unfunded Expenditures" shall mean the total unfunded Decommissioning expenditures previously. incurred by the District.
" Secretary" shall mean an officer who keeps the l
. official records-of a corporation or organization ~.
"Section" shall mean a section of the Agreement, q
-"Special Certification" shall mean a written authorization signed by an Authorized Officer submitted to-l the Trustee at any time, pursuant to Section 2.04(B), for the payment of Decommissioning funds from the Fund.
" Termination Date" shall mean the last day this Agreement shall be in effect, pursuant to Section 4.01 or
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4.03. ?.
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" Treasury Officer" shall mean,'with respect to'the.
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District,'the Chief. Financial Officer,-the Treasurer, or.any Assistant Treasurer ~the identity of whom shall be certif:ed to the Trustee in writing in accordance'with Section 4.07.
" Trust" shall mean the trust so titled the l
" Sacramento Municipal Utility District Rancho Seco Nuclear Generating Station Decommissioning Trust" created by Section-2.02 of this Agreement.
" Trustee" shall mean Bankers Trust Company, as Trustee of the Trust, and its successors and assigns under
'this Agreement.
ARTICLI II THE ESTABLISRMENT OF THE TRUST AND APPLICATION OF THE FUND' Section 2.01.
Resolution.
The Trustee hereby acknowledges receipt of a true and correct-copy of the Resolution establishing the Trust and the Fund.
Section 2.02'.
Establishment of-Trust and Fund.
.There is hereby established-for the benefit of the NRC,'the b
customer-owners of the District and the citizens of the State of California, and for the purpose of discharging the District's legal obligation to accomplish-the Decommis-o sioning of the Plant, a segregated external trust designated
.the " Sacramento Municipal Utility District Rancho Seco i
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Nuclear Generating Station Decommissioning Trust" containing.
a fund to be held in the custody of the Trustee.
Section 2.03.
Deposits Into Fund.
In order to provide a source of funds to meet the estimsted cost of Decommissioning, the District shall deposit-monies into the-f Fund'according-the funding schedule set forth in the.
District's' Financial Assurance Plan.
The First Annual i
Payment and subsequent Annual Payments may be funded with cash or Permitted Investments or a combination thereof.
On c
or before deposit of any funds, the District will provide.
the Trustee, in a format'similar to Exhibit "1",
a written description of any amounts being deposited into the Fund.
r The District and the-Trustee hereby acknowlege that the-District may amend the Financial Assurance Plan from time to time, provided, however, that no amendment to the Financial Assurance Plan which affects the rights,. duties or responsibilites of the Trustee under the Agreement may be made without the Trustee's prior written consent.
Section 2.04.
Application of'the Fund.
To enable q
the District to meet Decommissioning expenses as they arise, the District is hereby empowered to make' withdrawals from the Fund upon the following terms and conditions:
A.
The District may submit to the Trustee at three month intervals a certification which shall s r
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1 contain the amount to be disbursed.
Other than in the J
caseIof submission-of the initial Certification, such-
-amount shall be calculated according to the following.
' formula:
=1 1.
a)
The total amount of Decommissioning expenditures, if any, actually incurred by the District during the prior three (3) month period, j
a i
b) minus the total aggregate amount received by the District, if any,.out of!the Fund for Decommissioning purposes.during the
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prior three month' period, EQUALS c)-
the total Prior Unfunded Expenditures for-the prior three (3) month period..
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PLUS I
2.
All Future Unfunded Expenditures, if any, in.
the ensuing three (3) month period.
Note:
In'the event that, during. any three' (3) month period,;the. District shall have received monies out of the Fund for Decommissioning purposes in excess of Decommissioning expenses actually incurred during the same period, the Prior Unfunded' Expenditures would be a negative number thereby decreasing the Certification Amount received. pursuant to any Certification submitted to the Trustee at the and of any such three'(3) month period.
All. Certifications shall be made by an Authorized Officer of the District and shall be submitted to the Trumise in the form attached hereto as Exhibit "2".
=Provided that a Certification is in compliance with the r
requirements of this Section 2.04, the Trustee shall pay to
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l the District, out of the rund, the certification Anount on or before the date specified by the District in any such certification.
B.
Notwithstanding any of the foregoing, should the District determine, in its sole discretion, that it is required to make a Decommissioning expenditure for which prospective provision was not made in any prior certification to the Trustee:, the District may, at any time, submit a "special certification" to the Trustee in the same form required for a certification.
Upon receipt of a special certification, the Trustee shall pay to the District, out of the Fund, the amount so authorized by the special certification on or before the date specified by the District in any such special Certification.
c.
Notwithstanding anything in this Section 2.04 to the contrary, in the event that the Amortized Book Value of thL Fund should exceed the total cost estimate of Decommissioning (as determined pursuant to the Financial Assurance Plan) for any year during the term of the Agreement, the District may make a " General Withdrawal" of such excess funds from the corpus of the Fund to be used by the District.
All authorizations for General Withdrawals:
(1) shall be submitted in
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writing to the Trustee specifying the date by which any suas authorized for payment from the Fund must be received by the District; and (2) shall be made by an Authorized officer.
In no event shall the District's authorization for the payment of General Withdrawals in i
any twelve (12) month period exceed the difference y
between the Amortized Book Value of the Fund and the cost estimate of Decommissioning (as set forth in the Financial Assurance Plan) for such period in which such General Withdrawals are made.
D.
The District shall submit copies of all Certifications, Special Certifications and General Withdrawals to the NRC.
E.
The Trustee shall not be responsible for the form or content of any certification Special Certifi-cation or General Withdrawal delivered to it under the Agreem*Pt, and each direction to the Trustee in any such document shall constitute a certification by the District that such direction is in accordance with any applicable laws and regulations of the NRC and the State of California and that any requisite consents, waivers or approvals of the NRC have been duly and validly obtained, given or waived, as the case may be.
The Trustee may rely conclusively on any such 4
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I certification, special Certification or General With-drawal and shall have no duty to make any independent aquiry or investigation before acting upon any direc-tion contained therein.
i F.
The Trustee shall have no responsibility for enforcing payment of any contributions to the Fund, or for the timing, computation or amount tnereof, or for j
the adequacy of the Funds or the funding standards adopted by the District to meet or discharge any Decom-j missioning expenses or other liabilities in connection
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with Rancho seco.
L G.
Except as provided in Section 3.06 hereof, i
the Trustee shall have no duty to commence or maintain 1
L any action, suit or legal proceeding on behalf of the j
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Trust or the Fund unless the Trustee has been directed i
to do so by the District and unless the Trustee is either in possession of assets sufficient for such j
purpose or unless it has been indemnified by the District, to its satisfaction, for counsel fees, costs i
l and other expenses and liabilities to which it, in its sole judgment, may be subjected by beginning or maintaining such action, suit or legal _ proceeding.
E Section 2.05.
Limited Use.
Except as provided in Sections 2.04(C), 3.01 and 3.02 of the Agreement, all l l l
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i monies, deposits, and securities held in the Fund pursuant I
to the Agreement shall be used solely for the cost of Decommissioning.
Principal and income contributed or payable to the Fund shall neither vest in the District, be taken or reached by any legal or equitable process in satisfaction of any debt of the District, or be used for or diverted to any purposes other than those specifically authorized herein.
l T
Section 2.06.
Grantor Trust.
The parties hereby 1
acknowledge that-the District is an entity exempt from tax-ation under Section 501(c) of the Internal Revenue Code of 1986, as amended.
The parties agree that the Trust herein established is a Grantor Trust pursuant to Section 671 et i
sea. of the Internal Revenue Code of 1986, as amended; that d
the District is the owner of the entire Trust for federal income tax purposes; and that the Trustee shall not be required to file a federal income tax return with respect to the Trust for any taxable year during which the Trust is in existence.
l Section 2.07.
Domestic Trust.
The Trust under which the Fund is established and maintained shall at all times be maintained as a domestic trust in the United States.
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e ARTICLE III t
CONCERNING THE TRUSTEE
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Section 3.01.
Investments.
The Trustee has the
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duty to execute the investment of any knd all monies held i
hereunder in Permitted Investments.
The District shall have i
sole responsibility for determining whether a contemplated i
investment is a Permitted Investment and for communicating r
same to the Trustee, who shall have no responsibility therefor.
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Section 3.02.
Investment Authority.
The Trustee shall exercise its investment duties pursuant to Section 3.01 only in accordance with the verbal instructions (followed by prompt written confirmation thereof) of a i
Treasury Officer of the District.
The District hereby retains sole authority to determine which among the Permitted Investments the Trustee shall make, and the i
District hereby. agrees to be bound by the terms and conditions of the Agreement when making such investment determinations.
The provisions of Section 3.01 or any of the foregoing to the contrary notwithstanding, the District L
may, in its sole discretion, and at any time during the term of the Agreement, delegate its power to direct the investment of the Fund's assets to an investment manager, The terms and conditions of appointment, authority and i
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retention of any investment manager shall be the sole responsibility of the District.
Any such investment manager to whom the District may delegate its investment powers granted herein, shall be required to execute and deliver to the Trustee any and all documents as may be necessary to evidence said investment manager's agreement to be bound by all terms and conditions respecting the Permitted Investments contained in this Section 3.02 of the Agreement.
The District shall promptly notify the Trustee in writing of a
the appointment or removal of an investment manager and shall cause each investment manager so appointed to furnish the Trustee from time to time with the names and signatures of those persons authorized to direct the Trustee on its bshalf hereunder.
In the event the Trustee follows all such directions received from the District or such investment manager appointed by the District, the Trustee shall not be liable for any losses incurred by reason of any action taken
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pursuant to such directions, provided such directions are in compliance with the requirements of this section 3.02.
Section 3.03.
Annual Accounting.
A.
The Trustee shall submit to the District a written annual " Accounting" of'the Fund as of the end of each calendar year during which
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the Agreement shall be in effect.
The Accounting, which l
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shall be delivered to the District no later than January f
31st of each year during the term hereof, shall includes (i)
The balance of the Fund at the close of the l
l last previous Accounting, and all amounts received from i
i whatever source during the period covered by the l
Accountingt (ii)
A listing of all disbursements from the Fundt (iii)
An inventory of all investments held by the Trustee as of the date of the Accountingt and (iv)
Such other information as the District may, from time to time, reasonably request be included in t
any such Accounting.
A copy of all Accountings shall be submitted by the District to the NRC within thirty (30) days after receipt thereof by the District.
i B.
During the term of the Agreement, the Trustee l
shall give the District (or the District's representatives)
I full access, upon reasonable notice during Trustee's normal business hours, to all books and records relating to the 1
l Fund, and shall provide the District (or the District's representatives) with all such information regarding the y
l Fund as the District (or the District's representatives) may i
j reasonably request.
1 c.
Upon the expiration of one-hundred eighty (180) days from the date of providing its Accounting to the 5
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District, and, except as provjQed in Section 3.06 hereof, j
the Trustee shall be foreve*/ released and discharged from j
-all liability and further accountability to the District with respect to the accuracy of such Accounting and the propriety of all acts and failure to act of the Trustee j
reflected in such Accounting, except with respect to any acts or transactions as to which the District shall, within such 180-day period, file with the Trustee specific written objections.
D.
Nothing herein shall in any way limit the Trustee's right to bring any action or proceeding in a efaurt of competent jurisdiction to settle its account or for such i
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other relief as it may deem appropriate.
No party other than the District shall be a necessary party in any such t
action or proceeding or may require the Trustee to account or may institute any other action or proceeding against the Trustee.
Section 3.04.
Compensation of Trustee.
The District shall compensate the Trustee for its performance of the services specified in the Agreement.
During the first three (3) years of the Agreement, the Trustee shall be
- entitled to quarterly compensation as set forth in the compensation Agreement dated as of July 19 1990 by and between the District and Bankers Trust Company.
On a.
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quarterly retrospective basis, the Trustee shall submit to the District an invoice for the followings (1) the Trustee's quarterly compensation as cet forth in the Compensation Agreement; and (2) upon prior written approval i
of the District, all fair and reasonable administrative ex-a penses incurred by the Trustee during the previous quarter i
in connection with the administration of the Fund.
The District shall pay undisputed quarterly invoices no later than thirty (30) days following the end of the applicable 1
calendar quarter or thirty (30) days following the receipt j
by the District of such quarterly invoices, whichever occurs later.
The Trustee's entitlement to reimbursement 1
hereunder shall not be affected by the resignation or removal of the Trustee or by the termination of the Agreement or of the Trust.
For all successive years that the Agreeuant shall l
be in effect, the Trustee shall receive compensation for its I
services hereunder in such amounts and upon such terms as l
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shall be agreed upon by the parties hereto in writing.
In
- 1 the event that the parties are unable to agree upon the
- Trustee's compensation for any such suc cessive year, the Trustee shall continue to receive the quarterly compensation 6
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stated in the preceding paragraph of this Section 3.04 for each such successive year.
l Section 3.05.
Standard of Care.
The Trustee shall perform such duties as are specifically set forth in the Agreement.
The Trustee shall exercise its duties with i
the degree of care and skill that a prudent person would exercise-in the conduct of his own affairs.
No provision of the Agreement, however, shall be l
construed to relieve Trustee from liability for its own
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neglect or willful misconduct except that A.
In the absence of bad faith on the part of the Trustee, the Trustee may conclusively rely, as to truth, authenticity and correctness, upon all documents and writings, including but not limited to all invest-ment instructions, Certifications, Special Certifica-tions and General Withdrawals pursuant to Sections 2.04 and 3.02 of the Agreement, furnished to the Trustee by I
the District, or by any investment manager appointed l
I under Section 3.02 of the Agreement; B.
The Trustee shall not be liable with respect to any action taken or omitted to be taken by it in t
good faith at the direction of the District or any I
investment manager respecting any Permitted Investments allowed by the Agreement; and
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C.
The Trustee shall have no responsibility to i
collect from the District any payments necessary to discharge any liabilities of the District established by the NRC.
Section 3.06.
Indemnity.
In consideration of the Trustee agreeing to enter into this Agreement and to act as Trustee hereunder, the District shall hold harmless the Trustee, individually and as Trustee, and the Trustees' directors, officers, and employees, from and against all
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i amounts, including, without limitation, taxes, penalties, i
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expenses (including reasonable counsel fees), liabilities, claims, damages, actions, suits or other charges, incurred by or assessed against the Trustee, individually or as Trustee, or its directors, officers or employees, arising out of this Agreement or its acting as Trustee, other than
+
those incurred as a result of its own bad faith, gross negligence or willful misconduct.
The undertaking made in this Section 3.06 shall be binding on the District, its successors or assigns and shall survive termination, amendment or restatement of this Agreement, or the resignation or removal of the Trustee.
If the District directs the Trustee to commence or maintain any action, suit or legal proceeding under section 2.04 ;3) herein, the District shall not be required to e,
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indemnify the Trustee for costs incurred by, or assessed I
against, the Trustee, which were incurred or assessed as a result of the Trustee's own bad faith, negligence or willful misconduct.
Section 3.07.
Maintenance of Office. 'There shall at all times be a Trustee hereunder which shall be a bank organized, chartered and doing business by virtue of the laws of the United States of America or any State or other subdivision thereof and authorized under such laws to exer-
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cise corporate trust powers, having combined capital and j
surplus and retained earnings of at least Fifty Million Dollars ($50,000,000.00), and subject to supervision or r
examination by Federal authority.
For purposes of deter-i mining whether such corporation meets the requirement of the
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L preceding sentence, the combined capital and surplus and retained earnings of such corporation shall be deemed to be f
'tm combined capital and surplus and retained earnings as s,-
forth in its most recent published report of condition.
I If at any time the Trustee shall cease to be eligible in l
l l
accordance with the provisions of this Section 3.07, the j
l District shall have the authority to request the immediate resignation of the Trustee in the manner and with the effect i
specified in Section 3.08 below.
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Section 3.08.
Resignation or Removal of Trustee.
The Trustee may at any time resign by giving 60 days' prior i
written notice to the District by certified mail of such resignation, provided that no such resignation shall take effect until the District appoints a successor trustee and such successor accepts such appointment.
If, for any reason a successor trustee is not appointed within 90 days after the District has received Trustee's notice of resignation, then the Trustee may petition any court of competent jurisdiction for the appointment of a successor trustee.
The Trustee shall charge any expenses incurred by it in connection therewith to the District.
The District may remove the Trustee and appoint a successor trustes upon the provision of 60 duys' written notice to the Trustee and the occurrence of any of the following:
A.
The Trustee ceases to be eligible in accordance with the provisions of Section 3.07 above and fails to resign after request therefore by the District B.
The Trustee shall become incapable of acting or shall be adjudged bankrupt or insolvent, or a receiver shall have been appointed of the Trustee, or.. -. -..
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of its property or affairs for the purpose of rehabili-tation, conservation or liquidation; or C.
The District shall determine, in its solo i
discretion, that the Trustee should be removed.
Should the Trustee resign or be removed for any reason, an independent audit of the Fund shall be conducted prior to the appointment of any successor Trustee.
The i
Trustee shall select an independent auditor, whose appointment shall be subject to the approval of the District.
The cost of such independent audit shall be borne j
by the Trustee, unless the Trustee is removed pursuant to Section 3.08(c) above.
Any resignation or removal of the Trustee and appointment of a successor Trustee pursuant to the provisions of this Section 3.08 shall become effective only upon acceptance of appointment by the successor Trustee as provided in Section 3.09 below.
Section 3.09.
Successor Trustee.
Any successor trustee-appointed as provided in Section 3.09 herein shall execute, acknowledge and deliver to the District, the NRC, and to the Trustee, an instrument accepting such appointment hereunder and thereupon the resignation or removal of the Trustee shall become effective and such successor trustee, without any further act, deed or conveyance, shall become vested with all the rights, powers, duties and obligations
~23-v.
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a be se hereunder, with like effect as if originally named as Trustee herein.
Notwithstanding anything in the foregoing sentence to the contrary, on the request of the District, or on the request of the successor trustee, the Trustee-ceasing to act hereunder shall execute and deliver all such instru-ments of transfer as may be necessary to transfer to such successor Trusteet (1) all assets of the Fund; and (2) all the rights and powers of the Trustee ceasing to act under the Agreement.
No successor trustee shall accept appointment as provided in this section 3.09 unless at the time of such acceptance such successor Trustee shall be eligible under the provisions of Section 3.07 of the Agreement.
ARTICLE IV MISCELLANEOUS Section 4.01.
Disposition of Assets.
A.
The District shall have no right to transfer its interest in assets of the Fund.
In the event of termination of the Trust, the Trustee shall dispose of the assets of the Fund, i
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after the payment of or other provision for all of its expenses (including any compensation to which the Trustee may be entitled).
Such disposition shall be accomplished in l
l accordance with the terms of a written payment certificate which the District shall provide to the Trustee on or immediately after the Termination Date.
Such payment i
i certificate shall contain the name and address of the person or entity to whom payment is due (which may be the District) and the amount of money to be paid or assets to be j
transferred.
In the event that termination results from the removal or resignation of the Trustee, then such disposition shall be implemented in accordance with Section 3.09.
B.
Until the final distribution of the assets of the Fund, the Trustee shall continue to have and may exercise all of the powers and discretions conferred upon it under the-Agreement.
Section 4.02.
Effective Date.
This Agreement shall commence and become operative on the-date of the deposit with the Trustee of the First Annual Payment which date shall be no later than July 26, 1991.
Section 4.03.
Termination.
A.
Except as otherwise provided herein, this Agreement shall terminate on such date as the District provides written notice to the i
Trustee that it has determined in its sole discretion, that..
4 s.<....
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Decommissioning has been completed.
Prior to the Termination Date, the District shall submit its final Cett.ification to the Trustee and the Trustee shall disburse funds to cover final Decommissioning costs.
On the Termination Date, the Trust herein established shall terminate, and any amounts remaining in the Fund shall be disposed of in the manner set forth in section 4.018.
B.
Any other provision of this Agreement to the contrary notwithstanding, the Fund established under this Trust shall terminate no later than the twenty-first anni-versary of the date of death of the survivor from among a class consisting of all of the descendants of the late
+
i Joseph p. Kennedy, the former Ambassador to the Court of saint James, who are living on the date of the establishment of the Fund, and if the Trust is still in existence on such anniversary date, the Trustee shall dispose of the assets of the Fund as the District shall direct.
Section 4.04.
Successors and Assigns.
All the covenants and representations made by the District and contained in the Agreement shall bind and inure to the bene-fit of its successors and assigns, whether so expressed or i
not.
Any successor, by merger or otherwise, to sub-stantially all of the trust business of Bankers Trust P.
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._____,___________m.___.____________m__m.
E.J
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i e
i Company shall automatically and without further action l
become the Trustee hereunder, subject to all of the terms and conditions and entitled to all of the benefits and i
' immunities hereof.
I section 4.05.
Severability.
If any provision of the Agreement should be determined by a court of competent jurisdiction to be contrary to law, such provision shall be deemed and construed to be severable from the remaining provisions herein contained, and shall in no way affect the validity of the remaining provisions of the Agreement.
Section 4.06.
Entire Agreement.
The Agreement supersedes all prior negotiations, agreements and under-standings among the parties with respect to the subject matter hereof.
The District and the Trustee understand that this Agreement is subject to the approval of the PRC, and recognize that they may choose to amend the Agreement from time to time.
To be effective, any amendment to, or modifi-l cation of, the Agreement must be in writing, executed by the
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District and the Trustee.
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Section 4.07.
N_otices.
Unless otherwise speci-fled herein, all notices required to be given by or to a party pursuant to the terms of the Agreement, including but not limited to, all Certifications, special certifications, General Withdrawals, invoices, reports, requests and t
r
, s '. * *
- o communications, shall be deemed to have been sufficiently given only if in writing and if sent by first class United States mail, postage prepaid, by or to the appropriate addressee indicated below:
To the Trustee Bankers Trust company 400 South Hope Street, 9th floor Los Angeles, California 90071 Attention:
Debra Lindbergh Assistant Vice President To the NRC:
United States Nuclear Regulatory Commission Attention: Document Control Desk Washington, D.C. 20555 L
L To the District:
Chief Financial Officer Sacramento Municipal Utility District 6201 S Street, Box 15830 Sacramento, CA 95852-1830 With a copy To:
The Treasurer Sacramento Municipal Utility District 6201 S Street, Box 15830 Sacramento, CA 95852-1830-E I
Changes to the abovt addresses may be made from time to time by written notice to the other entities from i
the above-named-representative of the respective entity or from any other duly authorized officer of that entity as certified by the Secretary of that entity.
I I
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(.o **.i Section 4.08.
Headin2s.
The headings of the Sections used in the Agreement are for convenience only and shall not control or affect the meaning of any of the provisions thereof.
Section 4.09.
Representations.
A.
The Trustee represents that it has the power, authority and legal right to enter into and perform its obligations set forth in the Agreement and that the execution, delivery and performance l
hereof have been duly authorized.
B.
The District represents that it has the power, authority and legal right to enter into and perform its obligations set forth in the Agreement.
The District further represents that the execution, delivery and
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performancs of the Agreement have been duly authorized and l
will not violate any applicable law, regulation or by-law of the District.
C.
Whenever the provisions of the Agreement specifically require or permit any action to be taken by the i
l District, such action must be authorized by the Board of L
Directors of the District or by an Authorized officer.
Any resolution adopted by the Board of Directors or other evidence of such authorization shall be certified to the Trustee by the Secretary of the District under its corporate seal, and the Trustee may rely upon any authorization so l
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certified until revoked or modified by a further. action of the Board of Directors similarly certified to the Trustee.
Section 4.10.
Counterparts.
The Agreement may be executed in several counterparts, all or any of which shall be regarded for all purposes as an original and shall con-stitute and be one and the same Agreement.
Section 4.11.
Governing Law.
The Agreement and any questions concerning its validity, construction or performance shall be governed by the laws of the state of California.
Section 4.12.
No Additional Dution.
All refer-ences herein to the Financial Assurance Plan and to catain duties and obligations between the District and the NRC are made for purposes of identification only and are not intended to impose any additional obligations.on the Trustee.
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other than those which it has specifically undertaken here-
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under.
Furthermore, the Trustee shall be in no way respon-I sible for the form and/or content of the Financial Assurance Plan.
I IN WITNESS WHEREOF, the parties hereto have each 4
caused the Agreement to be executed by their duly authorized officers and their corporate seals to be hereunto affixed and attested as of the date first above written, but l
actually on July 19
, 1990.
SACRAMENTO MUNICIPAL UTILITY l
DISTRICT, a public corpo-ration and political sub-division of the State of California ATATEk4%
W By: WanSchori By:
S. David Freeman Its:
Secretary Its: 2 p,eral Mananer ATTEST:
BANKERS TRUST COMPANY
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Trustee By:
_I h d M. //.f M 7 t
By: Deborab Lindberg
~
j Its: Assistant Vice Its: Susan T. Reiter Simowitz. Vice President President l
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~$
EXHIBIT *1"'
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1.
Cash:
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1 2
2.
Securities:
Description of Security Amortized Book Cost a.
h b.
i c.
d.
a.
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f.
9
[
etc.
Subtotal i
TOTAL PAYMENT l
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I EXHIBIT "2" j
Check One:
j
[3 Certification
[3 Special Certification CERTIFICATION i
Bankers Trust of New York 280 Park Avenue
)
New York, NY 10017 Attention: Trust Department In accordance with the terms of that certain Decommissioning Trust Fund Agreement dated
,1990, I,
[ insert title officer) of the Sacramento Municipal Utility District (the " District") hereby request a withdrawal from the Sacramento Municipal Utility District Rancho Seco Decommissioning Trust Pund (the " Trust") as follows:
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1.
Total Decommiss incurred during the,ioning Expenditures prior 3 month period:
minus Aggregate amount of all withdrawals for i
Decommissioning during the prior 3 month period 1
equals Prior Unfunded Expenditures:
PLUS i
2.
Anticipated Decommissioning Expenditures 4
for the period
,19__ to
,19__
EQUALS CERTIFICATION AMOUNT I-The certification Amount shall be paid to the District via wire transfer to the District's account. number at (insert name of Deposit 9ry Bank) on or before
,19__.
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33 Y
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a ma.
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. te.s e 3
,e' Exhibit 2 Page 2 The undersigned hereby certifies.that the Certification Amount authorized from the Fund shall be used solely for the purpose of meeting the District's expenses in connection with the Decommissioning of the District's. Rancho Seco Nuclear Generating i
Station. The undersigned further certifies that a copy of this Certification has been submitted to the Nuclear Regulatory Commission.
DATED:
SACRAMENTO MUNICIPAL UTILITY DISTRICT By Its_
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