ML20058L747
| ML20058L747 | |
| Person / Time | |
|---|---|
| Issue date: | 12/13/1993 |
| From: | Chilk S NRC OFFICE OF THE SECRETARY (SECY) |
| To: | Taylor J NRC OFFICE OF THE EXECUTIVE DIRECTOR FOR OPERATIONS (EDO) |
| References | |
| FRN-58FR68726, REF-10CFR9.7 AE16-2-007, AE16-2-7, M931209C, NUDOCS 9312170170 | |
| Download: ML20058L747 (4) | |
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UNITED STATES
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NUCLEAR REGULATORY COMMISSION W ASHMGTOrd. D.C. 20555 IN RESPONSE, PLEASE
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., y REFER TO:
M931209C S 'h
%,'\\d p'4 December 13, 1993
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OF FICE OF THE SECRETARY I
MEMORANDUM FOR:
James M.
Taylor ExecutiveDirectorforOferaions fN FROM:
Samuel J.
Chilk, Secreta 1
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SUBJECT:
STAFF REQUIREMENTS - AFF ERMhTION/ DISCUSSION l
AND VOTE, 3:30 P.M.,
THU)SDAY, DECEMBER 9, 1993, COMMISSIONERS' CONFERENCE ROOM, ONE WHITE FLINT NORTH, ROCKVILLE, MARYLAND (OPEN TO PUBLIC ATTENDANCE) i l
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SECY-93-284 - Final Rule, 10 CFR Parts 30, 40, 50, 70, and 72, "Self-Guarantee as an Additional Financial Assurance Mechanism" The Commission, by a 4-0* vote, approved a final rule amending its regulations to allow certain non-electric utility licensees i
to use self-guarantee as a means of financial assurance of the adequacy of funding for decommissioning costs.
l The Federal Register Notice should be reviewed by the Regulatory Publications Branch, ADM and forwarded for signature and publication.
(EDO)
(SECY Suspense:
12/30/93) l The Commission also agreed that the staff should study the development of alternative financial criteria which can be used by non-bond issuing licensees seeking to use the self-guarantee option and report to the Commission when it reports on its study j
of the development of alternative criteria for non-profit l
entities (reference Commissioner de Planque's vote, attached).
(EDO)
(SECY Suspense:
TBD)
- Section 201 of the Energy Reorganization Act, 42 U.S.C.
Section 5841, provides that action of the Commission shall be determined by a " majority vote of the members present." -Commissioner Remick was not present when this item was affirmed.
Accordingly, the formal vote of the Commission was 3-0 in favor of the decision.
Commissioner Remick, however, had previously indicated that he would approve this paper and had he been present he would have affirmed his prior vote.
fpk 150 J ~El 9312170170 931213
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Attachment:
I As stated cc:
The Chairman
. Commissioner Rogers Commissioner Remick Ccmmissioner de Planque OGC OIG OCA Office Directors, Regions, ACRS, ACNW, ASLBP (via E-Mail)
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AFFIRHAT10N V0TE RESPONSE SHEET T0:
SAMUEL J. CHILK, SECRETARY OF THE COMMISSION-FROM:
COMMISSIONER DE PLANQUE
SUBJECT:
SECY-93-284 - FINAL RULE, 10 CFR PARTS 30, 40, 50, 70, AND 72, "SELF-GUARANTEE AS AN ADDITIONAL FINANCIAL ASSURANCE MECHANISM" APPROVED x (w/ecr=ents)
DISAPPROVED ABSTAIN NOT PARTICIPATING REQUEST DISCUSSION COMMENTS:
See Attached Ccements.
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P.Ad*b S/w w SIGNATURE RELEASE VOTE
/ XX /
oecerter 7 1993 DATE WITHHOLD VOTE
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ENTERED ON "AS" YES HO xx
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Commissioner de Planque's Comments on SECY-93-2843 i
I approve issuance of the final rule providing for self-guarantee as an additional financial assurance mechanism.
However, I believe that staff should study the development of alternative criteria which can be used by non-bond issuing licensees for the reasons orplained below.
The staff's analysis of public comments on the proposed rule notes that one commenter argued that the bond rating criterion should be eliminated because it unfairly discriminates against companies that have not issued bonds.
g_se SECY-93-284, Enclosure e
A, p.3.
The staff's response notes that " firms that finance their activities through equity or short term commercial lines of credit may be as financially strong as firms that issue bonds,"
but indicates that it does not intend to remedy this admitted inequity because there is no criterion equivalent to the stringent bond-rating criterion which can be employed for firms that do not issue bonds.
The Federal Recister Notice itself does not directly address the inequity issue, but does suggest that
"[a]t some future time, when the Commission has gained some experience with self-guarantee, it may consider an appropriate revision of the financial criteria" such as the test that a parent company of a licensee must meet.
This less stringent test could be utilized both by bond-issuing and non-bond issuing firms.
Staff subsequently informed me that the number of non-bond issuing licensees who would otherwise be able to meet all the self-guarantee criteria is 20-40 (7-14% of licensees in the database).
g_qj!g M e m o r a n d u m, James M. Taylor to Comaissioner de Planque, December 1, 1993.
This is not an insignificant number.
I believe that staff should expand the resources necessary to study the development of alternative financial criteria which could be used by non-bond issuing licensees.
(Presumably, this would either be stringent criteria equivalent to the bond-rating criterion or less stringent criteria which would be available to both bond-issuing and non-bond issuing firms.)
This would cure the inequity in the final rule and, as staff points out, would also answer objections that the rule favors big companies since bonds are used mainly by larger firms.
Staff indicates that the financial criteria used in the NRC parent guarantee could serve as a starting point for the development of alternative criterin, thereby lessening the resources needed for this task.
I also note that staff has committed to studying the development of alternative criteria for non-profit entities, see FRN, p. 11.
This suggests that staff is concerned to treat all licensees as fairly as possible with respect to allowing self-insurance mechanisms.
Therefore, I propose that when staff reports the results of its study of the development of alternative criteria for non-profit entities, it also report on the results of studying the development of alternative criteria which can be used by non-bond issuing licensees.