ML20126F419
| ML20126F419 | |
| Person / Time | |
|---|---|
| Site: | 07109030, 07100397, 07109153, 07104888, 07105862, 07109206 |
| Issue date: | 12/04/1992 |
| From: | Taylor J NRC OFFICE OF THE EXECUTIVE DIRECTOR FOR OPERATIONS (EDO) |
| To: | Dyson E BAKER & MCKENZIE, TELEDYNE ENERGY SYSTEMS |
| Shared Package | |
| ML20126F421 | List: |
| References | |
| NUDOCS 9212300303 | |
| Download: ML20126F419 (5) | |
Text
. ..
_g SEC ~ q 79p Baker & McKenzie j ATTN: Edward E. Dyson ;
815 Connecticut Avenue, N.W. !
Washington, D.C. 20006-4078 Gentlemen:
I am responding to your August 24, 1992, letter requesting, on behalf of Teledyne Energy Systems _(Teledyne), either a full or-a partial exemption from the FY 1992 annual fee assessed for-Quality Assurance Program Approval No. 0397l(Invoice AM02834-92).
This matter was also discussed in your September 15, 1992, and 1 October 1, 1992, meetings with NRC staff. l The bases for your requests are: 1) Teledyne does not maintain an ongoing active business in RTG production; 2) Teledyne has not l manufactured a new Strontium-90 fueled RTG since 1986 and presently only provides spare parts and support services for existing generators; 3) Toledyne's average annual receipts in this portion of its business are between approximately $250,000 and $300,000, below the threshold for small entities; 4).but for NRC's position that a Fabricators and Users QA Plan must support-the Certificate of compliance covering these.RTG's, Teledyne- :
would not need to maintain an approved QA plan and pay the exorbitant annual fees - NRC maintains that the users-QA plans are not of sufficient scope to support the Certificate of Compliance; 5) the assessment of the FY 1992 annual. fee against Teledyne is unfair, inequitable, and contrary to_ Congressional intent; 6) the assessment of the annual fee has no reasonable-relationship to the cost of providing regulatory services to Toledyne; 7) other than two meetings, services provided1by:NRC to:
Teledyne have been limited to an infrequent phone call to discuss interpretation of regulations and related issues; 8)'Teledyne pays separately for all-other_ services received from NRC;_ 9)-
-Teledyne is unlike.other-licensees in Category.10.B.1, whose containers are regularly reshipped and roused,:thus requiring-greater attention by the NRC and, initurn, receiving greater benefits from NRC services; and 10) cancellation ~is not a valid <
option for Teledyne because this would-result in terminating 1the certificate of Compliance on which Teledyne's customers, specifically the Navy.and Air Force, rely. g As stated in 10 CFR 171.11(d), the Commission may' grant a- h materials licensee an exemption from-the annual fee only if it determines that the annual fee is not based on a fair and 9212300303 921204 g ,y PDR ADOCK 07100397 C- PDR i
- o o Telodyne Energy Systems p.2 equitable allocation of the NRC costs. The-following-factors must be fulfilled as determined by the Commission for an exemption to be granted.
- 1) There are data specifically indicating that the assessment of the annual fee will result in a significantly disproportionate allocation of costs to ;
the licensee, or class of licensees;
- 2) -There is clear and convincing evidence that the budgeted generic costs attributable to the class of licensees are neither directly nor indirectly related~
to-the specific class of licensee nor~ explicitly allocated to the licensee by Commission policy decision; and
- 3) Any other relevant matter that the licensee believes shows that the annual' fee was not based on a fair and-equitable allocation of NRC costs.
These criteria are consistent with the requirement of Public Law 101-508 that: "To the maximum extent practical, the charges shall have a reasonable relationship to-the cost of providing regulatory services and may be based on the allocation of the Commission's resources among licensees or classes of licensees."
Public Law 101-508, the Omnibus Budget Reconciliation'Act of 1990, requires that the Commission recover 100 percent of its budget authority, less appropriations from the Nuclear Waste Fund, for Fiscal-Years 1991 through 1995 by assessing license and annual fees. In addition to continuing the-licensing and
' inspection fees under 10 CFR Part 170-for identifiable services to specific applicants or licensees, the new rule established an annual fee for materials. licensees and holders of certificates,-
registrations and approvals.- As stated in.the supplementary information accompanying the rule, the annual fees are to recover NRC's generic and other regulatory costs that are not recovered as identifiable services to specific applicants or licensees under 10 CFR Part 170. The costs allocated to the. licenses-within the user and-fabricator subclass are for the generic safety'and other regulatory activities that are: attributable-to
.this subclass of licensees and that are not recovered by 10 CFR Part 170 license and-inspection-fees. The'same NRC-regulations, (e.g., 10 CFR Part 71), guidance (e.g., Regulatory Guides) and-policies are applied to each fabricator and user approval holder and to the same degree, regardless of_whether_the packages are currently being manufactured. That is, given that a QA approval is required by the NRC, the NRC's regulations apply to the approval.
__ m_._ . . _ _ _ _ - _ _ _ _ _ _ .. _ _ _ _ _ _ _ _ _ _ _ _ _ _ _
}' .
O O ,
~Telodyne Energy Systems p.3 The NRC concludes that uniformly allocating the costs to the QA approval to determine the amount of the annual fee is a fair, equitable and practical way to recover its costs attributable to the fabricator and user subclass of quality assurance approval holders. In addition, this method of allocating the costs results in annual fees that have a reasonable relationship to the cost of providing the regulatory services; therefore, the annual fees do not result in a disproportionate allocation of NRC generic and other regulatory costs to the approval holders.
As an alternative to a full exemption from the annual foe, Toledyne suggests that under the principles of equity and fairness, it should be entitled to a partial exemption at a level applicable for small entities. In support for this position, Teledyne indicates that its average annual receipts in the RTG -
portion of its business (spare parts and support services for existing generators) are approximately $250,000 - $300,000'which would otherwise qualify it for the lower annual fee applicable to small entities of $1,800 if only the RTG portion of Toledyne's business were considered. The NRC disagrees with this position because it would result in a further subsidy from the larger entities for costs not directly related to them. This approach would also result in NRC licensees subsidizing the nuclear portion of an organization's business, when the organization -
itself is not willing to use its non-nuclear revenue to subsidize its nuclear operations. The NRC does not believe that this would be appropriate. With respect to the questicn of what constitutes gross receipts, the NRC' stated clearly in establishing the size standards and in the promulgation of the final rule establishing the lower tier small entity fee that the term " annual receipts" is used in the same manner as used by the Small Business Administration (SBA). In 13 CFR Part 121. 4 02 (b) (2 ) , annual receipts are defined ". . . to include all revenue in whatever form received or assessed from whatever sources . . . (54 FR 52647; December 21, 1989) (57 FR 13624; April 17, 1992).
Therefore, the term " annual gross receipts"-refers to the licensee's entire business, not solely receipts from licensed activities.
Based on the above, your request for either a full exemption or a partial exemption from the FY 1992 annual fee is. denied.
Enclosed is a copy of letter dated October 20, 1992, from Mr.
Charles E. MacDonald, the Chief of NRC's Transportation Branch, which-provided Mr. John Vogt of Teledyne Energy Systems with information on the two types of quality assurance program approvals and the associated requirements. If Teledyne Energy Systems elects to terminate or amend Approval No. 0397 to remove
Toledyne Energy Systems p.4 the activities related to design and fabrication, an application should be submitted to NRC addressing the issues explained in Mr.
MacDonald's letter. In accordance with the current provisions of 10 CFR Part 171, the annual fee will be reduced if an amendment or revision is issued to decrease the scope prior to October 1, of each fiscal year.
Sincerely, l3 Jamts M. Taylor Executive Director for operations
Enclosure:
As stated cc: Teledyne Energy Systems
... ,. ,~
I ,
U C)
DISTRIBUTIOll:
10 CFR 171 Exemption File FY 1992 (w/ orig. inc.)
~QA Approval _ File 0397; 5862; 9030; 9206; 9153;'4888 (w/ copy inc.)
Materials Annual Fee Correspondenca File (w/ copy inc.)
Invoice File __ (w/ copy inc.)
HUDOCS (ML61) (w/ copy inc.)
PDR GJackson DDandois EBlack DWeiss Jilolloway (w/ copy inc.)
GFehst EDO 8031 OC-92-322 DAF R/F LFDCD R/F (2)
LTremper (add this name if canec# ling invoice and/or issuing refund) 4 OFFICE: LFDCB:mac[ DAF M DAF' NAME: GJACKSON$ Lh-OIS DDA TD EBLACK LIIILLER DATE: fp/g '/92 (o/g/92 l0/$/92 / /92 OFFICE: OC OGC
/ fo//-
NAME: 1 AWAY JFUN ES TECT!!ClifID f .
DATE: [D /$ 92 g /92 0 /jb'/92 pj/ .c OFFICE: OC \ W #
NAME:
RSCF, GGINS Ek J7 j
R jf [
DATE: 4/<}f/92 g./ }/92
_