ML20129B415

Ack Receipt of Proposed Revs to Colorado Rules,Part 3, Licensing of Radioactive Matls, Dtd 960717.NRC Requests That When Proposed Rules Adopted & Published as Final Rules, Copy Be Provided for Review

ML20129B415
Person / Time
Issue date:	10/16/1996
From:	Lohaus P NRC OFFICE OF STATE PROGRAMS (OSP)
To:	Quillin R COLORADO, STATE OF
References
NUDOCS 9610230006
Download: ML20129B415 (25)

Text

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' ' Robert M. Ouillin, Director .

Radiation Control Division j

. Department of Public Health and Environment i 4300 Cherry Creek Drive South j

Denver, CO 80222-1530 )

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Dear Mr. Quillin:

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We have reviewed the proposed revisions to Colorado rules, Part 3; Licensing of

. Radioactive Materials; dated July 17,1996, and received by memorandum dated J

{ August 20,1996. The proposed rules were reviewed by comparison to the equivalent  !

NRC regulations in-10 CFR Parts 30,40, and 70. We acknowledged receipt of the  ;

.. proposed rules on August 30,1996. Dennis Sollenberger and Thomas J. O'Brien of this l office telephonically notified Mr. Don Simpson of our comments, (as enclosed), on

. ~ September 10,1996.

- Under our current procedure, a finding that a rule meets the compatibility requirements

may only be made based on a review of the final text of the rule. However, we have  ;

(determined that if the proposed rules were adopted (incorporating the comments) and .

~ without other significant change, they would be compatible. 1 We request that when the ' proposed rules are adopted and published as final rules, a copy

-of the "as published" rules be provided to us for review. As requested in our All .

I Agreement States Letter SP-96-027, " Request to Highlight Changes to Agreement State Regulatiosis Submitted.to_ NRC for Compatibility Review" (March 1,1996), please highlight l t .the final changes and send one copy in a computer readable format, if possible.  :

l If you have any questions regarding the comments or any of the NRC rules used in the

review, please contact me'or Mr. Tom O'Brien of my staff at (301) 415 2308. j p

". hn'alSigned By:

l PAULH.LOHAUS {

Paul H. Lohaus, Deputy Director l Office of State Programs  ;

Enclosure:

0 As stated c

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Robert M. Ouillin, Director

. Radiation Control Division Department of Public Health and Environment 4300 Cherry Creek Drive South Denver, CO 80222-1530

Dear Mr. Ouillin:

- We have reviewed the proposed revisions to Colorado, rules, Part 3, Licensing of-Radioactive Materials, dated July 17,1996, and received by memorandum dated August 20,1996. The proposed rules were reviewed by comparison to the equivalent  ;

NRC regulations in 10 CFR Parts 30,40, and 70. We acknowledged receipt of the '

proposed rules on August 30,1996. Dennis Sollenber er and Thomas J. O'Brien of this office telephonically notified Mr. Don Simpson of our c(omments, (as enclosed), on September 10,1996.

Under our current procedure, a finding that a rule meets the compatibility requirements may only be made based on a review of the final text of 'the rule. However, we have 1 determined that if the proposed rules were adopted (incorporating the comments) and )

without other significant change, they would be compatible.

\

We request that when the proposed rules are adopted and< published as final rules, a copy of the "as published" rules be provided to us for review. $s requested in our All Agreement States Letter SP 96-027, " Request to HighlightiChanges to Agreement State Regulations Submitted to NRC for Compatibility Review"(March 1,1996), please highlight the final changes and send one copy in a computer readable format, if possible.

\

if you have any questions regarding the comments or any of the NRC rules used in the s review, please contact me or Mr. Tom O'Brien of my staff a ' (301) 415 2308.

Sincerely, Paul H. Lohau\s, Deputy Director Office of Stat'e Programs

Enclosure:

As stated Distribution:

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i Robert M. Ouillin, Director Radiation Control Division Department of Public Health and Environment

4300 Cherry Creek Drive South Denver, CO 80222 1530

Dear Mr. Ouillin:

l We have reviewed the proposed revisions to Colo(ado rules, Part 3, Licensing of I'

! Radioactive Materials, dated 17 July 1996, and repeived by memorandum dated August 4

20,1996. The proposed rules were reviewed by comparison to the equivalent NRC - '

' regulations in 10 CFR Parts 30,40, and 70. We acknowledged receipt of the proposed rules on August 30,1996. Dennis Sollenberger and Thomas J. O'Brien of this office telephonically notified Mr. Don Simpson of our comrhents, (as enclosed), on September 10,1996, i Under our current procedure, a finding that a rule me s the compatibility requirements

! may only be made based on a review of the final text f the rule. However, we have ,

determined that if the proposed rules were adopted (in orporating the comments) and F without other significant change, they would be compa ible. i We request that when the proposed rules are adopted and published as final rules, a copy

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of the "as published" rules be provided to us for review.

Agreement States Letter SP 96-027, "Reauest ht Chanaesto Hiahlia$s to Aareement requested State in our A

Regulations Submitted to NRC for Comoatibility Review" ( arch 1,1996), please highlight  ;

the final changes and send one copy in a computer readab . format, if possible.

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If you have any questions regarding the comments'or any o

. review, please contact me or Mr. Tom O'Brien of my staff (301) 415a(2308.

the NRC rules used in the Sincerely, e

. Paul H. Lohaus, Deputy Director i Office of State Programs 1

Enclosure:

As stated

. Distribution:

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j NUCLEAR REGULATORY COMMISSION WASHINGTON. D.C. 30seHOM i

T.,.,,,.*/ October 16, 1996  ;

Robert M. Ouillin, Director '

Radiation Ccatrol Division  !

Department of Public Health and Environment l 4300 Cherry Creek Drive South  ;

Denver, CO 80222-1530

Dear Mr. Ouillin:

We have reviewed the proposed revisions to Colorado rules, Part 3, Licensing of Radioactive Materials, dated July 17,1996, and received by memorandum dated August 20,1996. The proposed rules were reviewed by comparison to the equivalent NRC regulations in 10 CFR Parts 30,40, and 70. We acknowledged receipt of the proposed rules on August 30,1996. Dennis Sollenberger and Thomas J. O'Brien of this office telephonically notified Mr. Don Simpson of our comments, (as enclosed), on September 10,1996.

Under our current procedure, a finding that a rule meets the compatibility requirements may only be made based on a review of the final text of the rule. However, we have determined that if the proposed rules were adopted (incorporating the comments) and without other significant change, they would be compatible.

We request that when the proposed rules are adopted and published as final rules, a copy of the "as published" rules be provided to us for review. As requested in our All Agreement States Letter SP-96-027, " Request to Highlight Changes to Agreement State Regulations Submitted to NRC for Compatibility Review" (March 1,1996), please highlight the final changes and send one copy in a computer readable format, if possible.

If you have any questions regarding the comments or any of the NRC rules used in the review, please contact me or Mr. Tom O'Brien of my staff at (301) 415-2308.

' erely, t)

[d )

Paul H. Lohaus, Deputy Director ,

Office of State Programs

^

Enclosure:

As stated

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l COMMENTS ON PROPOSED COLORADO REGULATIONS Colorado Section Comment 3.9.5.1.2.5.1 The 10 mci amount specified in 40.36(a) for ,

source material is not included and needs to be  ;

added to be compatible with 40.36(a). We also note, for ypur information, that your stated value of 10 times the applicable quantity of Schedule B is more restrictive than that specified in 10 CFR 30.35(a).

3.9.5.2 Colorado has chosen to combine all financial surety requirements for all licenses into this section. This causes a conflict in that NRC prohibits self insurance in Criterion 9 of  ;

Appendix A to 10 CFR 40 which states that self insurance does not satisfy the surety requirement for licenses 'uthorizing the receipt, possession, and use of source material 4 for uranium or thorium milling. Your revisions l delete this prohibition for source material licenses which must be maintained to be compatible with 10 CFR 40.36. It is not required for the byproduct or special nuclear materials licenses.

3.16.6.8 It is our unoerstanding that your wording to maintain records until the site has been released for unrestricted use was meant to be more restrittive than the NRC wording that records will be kept until the license is terminated as specified in 10 CFR 30.35(g).

This would be acceptable if that is the case.

3.16.6.8.3 It is our understanding that you do not want the depleted uranium exception stated in 10 CFR 40.36(f)(3). This would be acceptable if that is the case.

Part 3, Appendix A, III Appendix A III appears to be missing paragraphs i C and 0 which need to be added to be compatible l with Appendix A to 10 CFR Part 30.

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TASK DESCRIPTION - COLORDAO DRAFT PART 3 REGS " LICENSING OF RADIOACTIVE

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1 REGULATORY ANALYSIS ~ DRAFT l I

FOR COLORADO RULES AND REGULATIONS l PERTAINING TO RADIATION CONTROL $

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LICENSING OF RADIOACTIVE MATERIALS July 17,1996 $ ]

l The Radiation Control Act, Title 25, Article 11, Colorado Revised Statutes 1989 (Act) requires the Colorado Department of Public Health and Environment (Department) to license radioactive materials and to develop and conduct programs for evaluation and control of hazards associated 1 with the use of sources ofionizing radiation. l l

Section 25-11 104 of the Act requires the state Board of Health to formulate, adopt and l promulgate rules and regulations pertaining to radiation control, and that "all such regulations shall be modeled after and shall be neither more nor less stringent than those proposed by the I Conference of Radiation Control Program Directors, Inc... uncler the title Suggested State Regulationsfor Control ofRadiation (SSRCR); except that, in the event said board concludes on i I

the basis of detailed findings that a substantial deviation from any said suggested state regulations is warranted..."

In 1968 the State of Colorado entered into an agreement with the federal government whereby the State assumed the responsibility for the regulation of certain types of radioactive materials.

These are source material, byproduct material and special nuclear material. Because of this agreement between the state and the federal government for the State to assume authority over certain types of radioactive materials, the State regulations must be compatible with regulations of the U.S. Nuclear Regulatory Commission (NRC). Were the State not to have compatible regulations, the majority of our licensees would have to meet the same regulatory requirements under licenses issued by the NRC.

Part 3 of the Colorado Rules and Regulations Pertaining to Radiation Control (Regulations),

which establishes requirements for the licensing of radioactive material, was adpoted by the Board of Health in 1978. The Department is revising Part 3 so that State Regulations are compatible with NRC Regulations.

This Regulatory Analysis provides the background information relative to the action. This analysis is prepared in fulfillment of section 24-04-103 (4.5) (a) of the Colorado Administrative Procedures Act.

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. The proposed changes to the Regulations are fourfold:

l. Adoption of this rule will clarify decommissioninn financial assurance arrangement requirements, by removing ambiguity in the Regulations with regard to cost )

estimates and the ability of the licensee to reduce financial surety once cleanup is

completed.

I

2. By allowing Self-Assurance under certain conditions, this rule will allow l qualifying radioactive materials licensees flexibility to reduce the cost burden of financial assurance while providing the State sufficient assurance that

decommissioning costs will be funded.

3 3. The proposed changes amend the regulations to require licensees to prepare and maintain additional documentation that identifies all restricted areas and all areas i outside of restricted areas where documentation is required for unusual occurrences

. or spills, all areas outside of restricted areas where waste has been buried and all l

, areas outside the restricted areas containing - material that would require l l decontamination or special approval for disposal. The proposed change also ,

requires specific information on decontaminated equipment that will remain on site l 3

after license termination.

4. The proposed changes amend the regulations to specify the method for the L . disposition of records concerning decommissioning, offsite releases and waste disposal when a licensee terminates licensed activities or when licensed activities are transferred to another licensee. The regulation also requires forwarding of j these same records to the Department before the license is terminated.

I Regulatory Analysis of Financial Assurance Regulations i

1. A description of the classes of persons who will bear the costs and/or benefits from the

! action All licensees will benefit from having available straightforward criteria for financial assurance arrangements. The persons who will primarily receive the benefits of the action are licensees who possess sufficient financial assets that they may meet minimum qualifications of the rule. These persons meeting qualifications of the rule will be permitted to use self-guarantee as a financial assurance mechanism, reducing their regulatory burden for meeting financial assurance requirements while still providing the State with sufficient assurance that decommissioning costs will be funded. All licensees

-will benefit from clarified funding requirements.

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Regulatory Analysis July 17,1996 Page 2

1 Without controls, persons can unknowingly be exposed to radiation from radioactive materials. Health impacts can be calculated by estimating radiation exposure from radioactive materials. These risk analyses, based on several pathways for exposure, for )

individuals of both the regulated community and general population show a broad range of risks.

2. A description of the probable cuantitative and aualitative impacts of the orooosed rule.

economic and otherwig, upon the affected classes.

Ouantitative:

1 Revision of Part 3 will reduce overall costs associated with these regulations. The net  ;

benefit of self-guarantee will equal the savings to licensees resulting from the use of the self-guarantee mechanism (rather than a more expensive third party mechanism) minus an increase in public costs. The overall savings would more than off-set some increase in financial assurance review costs. Colorado requires the State to bill licensees rather J than pass this cost on to the public. The NRC estimates a savings of $731 per year per licensee qualified to use the self assurance mechanism, with a cost increase of $63 per year per such licensee to the public.

I Estimated Average Cost Associated with Compliance with Revised Rules Financial No.of Private Costs (per Public Costs Total Costs (per Assurance Option Affected Licensees licensee) (billable to licensee) licensee)

Licensee uses 28 $3060 $26 $3086 Third Party Guarantor l Licensee uses Self- 2 (estimate) $2329 $89 $2418 l

Assurance

difference 26 $ 731 Savings $63 (billable cost) $ 668 Savings i

Oualitative

1 There will be no adverse impacts to public health and safety associated with this action.

Relevant, more specific requirements already exist for financial assurance arrangements.

< However, the existing requirements are somewhat ambiguous. Adoption of these streamlined requirements should increase the likelihood licensees will have adequate i financial guarantees. Therefore, the adoption of these proposed regulations will reduce i

Regulatory Analysis l July 17,1996 Page 3 1

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the potenial for radiation exposures. This will reduce the risk of adverse health effects

'in those exposed and consequently reduce the liability of regulated industries and operations.

3. Probable costs to the Deoartment and to local health departments. Anticipated effects on state revenues.

No additional staff will be needed to complete this action. There will be no effect on the Department, local health departments or on state revenues.

The cost of processing license applications and amendments and conducting inspections is not expected to change. Costs will continue to be billed to the licensees. No additional staff are anticipated at this time to implement these regulations. . Any costs to the Department due to minor increases in review time for this purpose should be offset by

. fees / billing to licensees.

Local health departments are not impacted as they do not regulate sources ofionizing radiation.

4. A comoarison of the orobable costs and benefits of the oronosed rule and probable costs

and benefits ofinaction.

1 1

There are no significant costs to the licensees or the public if revisions to Part 3 are I j adopted.

Based upon some amount of additional record keeping and review time, the NRC estimates an additional estimated cost of $63 per eligible licensee will be incurred annually to comply with these regulations. The State is required to bill this additional

- review cost to the licensees.

l There are benefits of adoption of the proposed regulations. The Department, the regulated l community and general public will have a set of simplified standards as guidance for financial assurance arrangements for licensees.

i Inaction in adoption of the proposed regulations could result in the Department's not 1 l maintaining State's agreement with the federal government, resulting in the reversion of the regulatory program to the federal government. Health risks could be increased i

ph(q(t M 4 without local involvement in this program. Were_this_to_b_e the case, radiation safety could be compromised and could result in ufdec Jadia~ tion expTosisteto both the' v

' 1 L regulated community and general public. Potentially, increased health care cost could f

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l be incurred by the State in the future due to the risks of unnecessary radiation exposures.

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Regulated industries and operations will also receive benefits from these regulations in

that there will be uniform standards which they must meet. Most industries and

operations already meet these standards on an unofficial basis. This will assure that these i industries and operations will uniformly meet these health protective standards. l

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5. A determination of whether there are less costly or ! css intrusive means to achieve the ouroose of the proposed rule.

I There are no less costly or less intrusive means available to meet the requirements as i stated in the Act. Adoption of these measures should decrease overall costs to licensees and risk to the State. The proposed regulation addresses the concerns of the public and <

regulated community and establishes rules that are necessary yet reasonable to protect the environment, the public and radiation workers. .

l

6. A description of alternative methods for achieving the ouroose of the proposed rule.

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The alternative method to the action would be to not adopt these measures.

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] The proposed regulations provide the necessary standards, technical guidance and ,

2 procedures to carry out the intent of the Act. There are no alternative methods available to meet the requirements of the Act and provide the specifics and definition necessary to provide reasonable radiation protection to the environment, the public and to radiation workers. bJv pp& ,

g Failure to adopt these revisions may result 'p_the'ioss of the State's agreement wih the ~

federal government. Loss of this status ildresult in loss of local control over local ,

i affairs, potentially leading to increased hea th risk and costs as a result of more distant I and expensive management under a federally managed program.

Regulatory Analysis of Decommissioning Recordkeeping and Disposition of Records Prior to License Termination i

~

1. A description of the classes of persons who will bear the costs and/or benefits from the action.

< The amendments to the regulations pertaining to decommissioning recordkeeping and Regulatory Analysis July 17,1996

- Page5

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l l disposition of records prior to license termination would currently apply to an estimated

28 radioactive material licensees. Of the 28 licensees, 22 have financial assurance agreements covering the cost of decommissioning and long-term care and six are State ph F Institutions with exemption to financial agreement requirements.

implementation of the regulation apply to both the licensee and the State.

The costs of ,

The beneficiaries of these amendments are the State and individuals living near facilities with radioactive materials. Continued retention of the required records will ensure their l availability in the event safety concerns are identified in the future and will be available to the State to provide information needed to assess possible risks associated with licensed

activities once a license has been terminated. In addition, the proposed amendments will i improve the regulatory framework relating to facilities where licensed activities will

continue after license transfer or re-assignment and will ensure that adequate information l to effectively decommission the facility is available to the new licensee.

s 2. A description of the orobable cuand tative and aualitative impacts of the proposed rule.

economic and otherwise. upon the affected classes.

i 1 1

Ouantitative:

l The cost of the revised rule will be incurred for transferring records to a new licensee or

! forwarding records to the Department prior to decommissioning. Records included in the

- revised rulemaking are already required to be maintained until license termination.

f In assessing these costs, a conservative assumption was made that 28 licensees possessing unsealed source material or unsealed by-product material with half-lives greater than 120 l days would be affected by the amended rule. Half this number, or 14 licensees, would

be affected by transfer or forwarding of records pertaining to offsite releases and waste disposal sections of the rule. All 28 licensees would be affected by the transfer or forwarding of records pertaining to decommissioning sections of the rule. The cost would i be a one time occurrence to the licensee. The Department would not accrue costs for these actions.

. There is no direct cost to the Department for permanent archiving of the records. ,

However, if a decision was made in the future to microfilm the records, the Department 1 would accrue the additional cost for this service.

The esdmated cost associated with compliance with revised recordkeeping and record disposition rules is shown in the following table.

f 1

Regulatory Analysis l

+ July 17,1996 l Page 6 l 5

t *,-

t Estimated Cost Associated with Comoliance with Revised Recordkeeoina and Record Disposition Rules ,

Licensee Action No. of Licensees Cost Per Licensee Total Cost Affected By Rule Transfer of records of I (estimated) $125 $125 offsite releases and records of waste disposal to new licensee Transfer of 1 (estimated) $248 $248 decommissioning records to new licensee ,

Forwarding records of 14 $72 $1008 l

offsite releases and  !

records of waste 1 disposal to the Dept.

Forwarding 28 $144 $4032 W-!ssioning records to the Dept.

Transfer of records to 28 $25/ box $700 the Dept, pursuant to RH 4.40 1

Total $6113 Oualitative:

The present rules are unclear with regard to the final disposition of required records when licensed activities have ceased and the license is terminated. In order for the Department to assure availability of certain records once licensed activities have ceased and the license is terminated there is a need to require the forwarding of these records to the Department prior to license termination. Continued retention of the required records will ensure their availability in the event safety concerns are identified in the future and will be available to the State to provide information needed to assess possible risks associated with licensed activities once a license has been terminated.

3. Probable costs to the Department and to local health departments. Anticipated effects on 4

state revenues.

No additional staff will be needed to complete this action. . There will be no effect on the

. Department, local health departments or on state revenues.

Regulatory Analysis July 17,1996 Page 7 t

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4. A comnarison of the orobable costs and benefits of the pronosed rule and probable costs and benefits ofinaction.

The cost of not changing the regulations would be minimal since records that would be needed by the Department or the new licensee should not be difficult to obtain. Without a consistent approach some of the needed records could be lost or destroyed inadvertently, resulting in additional costs to the Department or new licensee to make determinations of public risk. If decommissioning records are not retained and readily available in the future, there may be substantial costs of re-investigating sites.

5. A determination of whether there are less costly or less intrusive means to achieve the purpose of the proposed rule.

There are no less costly or less intrusive means to achieve the purpose of this rule.

6. A descrintion of alternative methods for achievinn the purpose of the proposed rule.

The alternative method to the action would be to not amend the changes to the Regulations. Without the action, the final disposition of licensee records when licensed activities have ceased and the license is terminated, is unclear.

In addition, failure to adopt these parts could result in the loss of State's agreement with the federal government. Loss of this status will result in loss oflocal control over local affairs, potentially leading to increased health risks and costs as a result of more distant and expensive management under a federally managed program.

Regulatory Analysis July 17,1996 Page 8

m? 1 DRAFT STATEMENT OF BASIS AND PURPOSE FOR COLORADO RULES AND REGULATIONS I PERTAINING TO RADIATION CONTROL 6 CCR 1007 PART 3 LICENSING OF RADIOACTIVE MATERIALS l l

July 17,1996 OVERVIEW l

In 1%8 the State of Colorado entered into an agreement with the federal government

( whereby the State assumed the responsibility for the regulation of certain types of radiation and radioactive materials.

The Radiation Control Act, Title 25, Article 11, Colorado Revised Statutes 1989 (Act) requires the Colorado Department of Public Health and Environment (Department) to license radioactive materials and to develop and conduct programs for evaluation and control of hazards associated with the use of sources of ionizing radiation.

Section 25-11-104 of the Act requires the state Board of Health to formulate, adopt, and promulgate rules and regulations pertaining to radiation control, and that "all such regulations shall be modeled after and shall be neither more or less stringent than those proposed by the Conference of Radiation Control Program Directors, Inc. (CRCPD) under the title of Suggested State Regulationsfor Control of Radiation; (SSRCR) except that, in the event said board concludes on the basis of detailed findings that a substantial deviation from any said suggested state regulations is warranted...".

The revisions to the Colorado Rules and Regulations Pertaining to Radiation Control l (Regulations) proposed herein are not presently included in the SSRCR. The proposed changes are a matter of compatibility with the U.S. Nuclear Regulatory Commission (NRC) and are needed to maintain the State's agreement with the federal government.

The proposed changes to the Regulations are fourfold:

1. Adoption of this rule will clarify decommissioning financial assurance 1 arrangement requirements by removing ambiguity in the Regulations with regard to cost estimates and the ability of the licensee to reduce financial

surety once cleanup is completed.

2. .By allowing Self-Assurance under certain conditions, this rule will allow qualifying Radioactive Materials licensees flexibility to reduce the cost burden of financial assurance while providing the State sufficient assurance that decommissioning costs will be funded.

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1

3. The proposed changes amend the regulations to require licensees to prepare and maintain additional documentation that identifies all restricted areas and all areas outside of restricted areas where documentation is required for unusual occurrences or spills, all areas where waste has been buried and all areas containing material that would require decontamination or special approval for disposal. The proposed change also requires specific information on decontaminated equipment that will remain on site after license termination.

4. The proposed changes amend the regulations pertaining to the transfer of records concerning decommissioning, offsite releases and waste disposal when a licensee terminates licensed activities, or when licensed activities are transferred to another licensee. The regulation also requires forwarding of these same records to the Department before the license is terminated.

. BASIS AND PURPOSE OF PROPOSED AMENDMENTS Financial Assurance Arrangements These rule changes are required to incorporate in regulations items that presently exist only i

in policy, or are needed to make the Colorado regulations compatible with NRC requirements. In 1978, the Board of Health adopted Part 3 of the Radiation Regulations.

Part 3 establishes requirements for the licensing of radioactive material. The provisions of the regulation were taken, in part, from the NRC Document on this subject. In order to maintain the State's agreement with the federal government, subsequent revisions to NRC Financial Assurance Arrangements requirements have necessitated the adoption of compatible measures in the Regulations. Adoption of this rule will allow qualifying Radioactive Materials licensees to reduce the cost burden of-financial assurance while providing the State sufficient assurance that decommissioning costs will be funded. This rule will have a beneficial effect in protecting public health and environment.

The rule provides a minimum requirement for the amount of decommissioning financial assurance funds for certain licensees and requires that the funds be provided by one of the prescribed methods stated in'the regulations.

The rule will also require a signed original of the financial instrument be submitted to the Department prior to receipt of licensed material.

The rule will add requirements that the decommissioning funding plan must contain a cost estimate for decommissioning, including provisions for adjusting cost estimates and associated funding levels periodically over the life of the facility. The decommissioning funding plan must also include a certification by ithe licensee that financial assurance has Statement of Basis and Purpose July 17,1996 Page 2

been provided for in the amount of the cost estimate for decommissioning.

The rule will add the requirement that the licensee shall maintain in effect all decommissioning financial assurance arrangements established by the licensee though license amendments and renewals through termination of the license, and that the amount of financial assurance must be increased or decreased, as appropriate, to cover the detailed cost estimate for decommissioning. This rule change clarifies that following approval of the decommissioning plan, a licensee may reduce the amount of financial assurance as decommissioning proceeds and radiological contamination is reduced at the site, with the approval of the Department. Also any licensee who has not provided financial assurance to cover the detailed cost estimate submitted with the decommissioning plan shall do so when this rule becomes effective. The above elements were not explicit in the Regulations, but only present in policy or less formal means. Now the State and licensees will benefit from having clearly stated requirements.

Self-Guarantee as an Additional Financial Assurance Mechanism The prohibition of Self Insurance (Assurance) as a financial assurance mechanism is deleted ,

l from this section. A new section has been added allowing for Self Assurance as a financial "g

assurance mechanism, provided the licensee has a tangible net worth in the United States of at least ten times decommissioning costs, and an "A" or better bond rating. With this rule Q

qualifying licensees will be able to reduce the cost burden of financial assurance while 9y" providing the State sufficient assurance that decommissioning costs will be funded.

Decommissioning Recordkeeping In order for the Department to confirm cleanup of land or facilities as part of the decommissioning and license termination activities, there is a need to know of the existence and location of relevant areas of possible contamination. At present the licensee is not specifically required to list: 1) all areas designated and formerly designated as restricted areas; (2) all areas outside of restricted areas that require documentation under current decommissioning rules;(3) all areas outside the restricted areas where radioactive waste has been buried and require documentation under the current rules; (4) all areas outside the restricted areas which contain radioactive material such that, if the license expired, the licensee would be required to either decontaminate the area to unrestricted release levels or apply for approval of disposal; and (5) the location and description of equipment and materials to remain onsite after license termination that was considered to be radioactively contaminated when final decommissioning was initiated.

The present rules are not sufficiently explicit to ensure that all relevant areas of possible contamination will be identified at the actual time of decommissioning. The Department Statement of Basis and Purpose July 17,1996 Page 3

l..-

• i f.

will need to know of the existence and location of these areas and equipment in order to perform confit.mtory surveys.

q Disoosition of Records Prior to License Termination or Transfer These rule changes are required to incorporate in regulations items that prewntly exist only 7 in policy, 'or ' are needed to make the~ Colorado regulations compatible with. NRC requirements. In order for the Department to assure availability of certain records once licensed activities have ceased and the license is terminated, there is a need to require the  ;

forwarding of these records to the Department prior to license termination. In the case of a license transfer, there is also a need to have the same records transferred or assigned to

the new licensee who will then be responsible for maintaining these records until the license 4

is terminated.  !

In order for the Department to determine that a licensee has effectively decommissioned 1

[  ; its facility, and to authorize license termination, the Department will review the licensees

! evaluation of previous releases to the environment and waste disposal to determine whether there is a need for the licensee to remediate significant offsite contamination as a result of past licensed activities prior to license termination. Licensees are already required to keep  !

these records until license termination. J

~ The present rules are unclear with regard to the final disposition of required records when l licensed activities have ceased and the license is terminated. i M

e 4

4 i ..

Staternent of Basis and Purpose July 17,1996 Page 4 h-

., . t

• r g:

DRAFT July 3, 1996 ,

a .

PART 3 LICENSING OF RADIOACTIVE MATERIAL  :

l i

1 3.1.2 In addition to the requirements of this part, all licensees are 2 subject to the requirements of Parts 1, 4, 10, 32 and 17 of these 3 regulations. Furthermore, licensees engaged in industrial 4 radiographic operations are subject to the requirements of Part 5 5 of these regulations, licensees using radionuclides in the healing 6 arts are subject to the requirements of Part 7 of these 7 regulations, licensees engaged in land disposal of radioactive a material are subject to the requirementw of EITHER Part 14 OR 9 PART 18 of these regulations, licensees engaged in source material  ;

I f

to milling are subject to the requirements of Part 18 of these '

11 regulations, and licensees engaged in wireline and subsurface 12 tracer studies are subject to the requirements of Part 16 of these 1

13 regulations.

14 ,

! l

] 15 l

16  ;

i 17 l

18 19 20 i

31 22 23 24 25 26 27 3 - 1

.* i t

6 DRAFT July 3, 1996 1 3.9.5 Financial assurance requirements, as described below, have been 2 met:

3 i 4 3.9.5.1 Financial Reauirc:' nts.

5 6 .The Department will require financial assurance arrangements 7 aa fellows:

s- l 9' 3.9.5.1.1 A license applicant may be required to furnish  !

i 10 financial assurance arrangements to ensure  !

11 decontamination and decommissioning of the facility  !

12 for the protection of the public health and safety and 13 the environment in the event of abandonment, default 14 or inability of the licensee to meet the requirements 15 of the Act, these regulations, and the license.

16.

17 3.9.5.1.2 The following specific licensees are required to 18 furnish fincncial assurance arrangements:  ;

19 20 3.9.5.1.2.1 Reserved.

v

-21 22 3.9.5.1.2.2 Commercial waste handling liconer<e; -

23 ,

24 3.9.5.1.2.3 Reserved.

25 ,

26  ;

i 27 28 3 - 27 I

i 4

i

• c ,~ . : . , .

. i i

DRAFT- , July 3, 1996  ;

i r

i 1 ~3.9.5.1.2.4 Source material mills; and  :

I

'.3 [

i

-3' 3.9.'5.1.2.5 Each applicant for a specific license  ;

4 authorizing the possession and use of licensed 5 radioactive material with a half life greater 6 'than 120 days in quantities: am d $ 4 ... 78 '7[ a  !

.7 pV)4 p gl y'j .h[s 8 3.9.5.1.2.5.1 greater than 1.0 ) times the applicable  !

9 quantity of Schedule B of Part 3 unsealed 10 - form. For a combination of isotopes if R N.Tb j 11 divided by 103 is greater than 1 (unity 12 rule), where R is defined here as the sum 13 of the ratios of the quantity of each <

1 14 isotope in the applicable value in 15- Schedule B. ,

16 -l i

17 3.9.5.1.2.5.2 greater than 10" times the applicable- '

'18 quantity of Schedule B of Part 3 in sealed -

19 sources or plated foils. For a ,

1 20 combination of isotopes if R divided by ,

21 10" is greater than 1 (unity rule), where i

32 R is defined in RH 3.9.5.1.2.5.1.  !

23 f i

'24 3.9.5.1.3 Reserved. j t

- 35

26 2.0.5.1.2.1 E::crved.

27 i-28 '2.9.5.1.2.2 ner rr:d.

- 29 30' 3 - 28 l v

i-i . . .

DRAFT July 3, 1996

.i

-1 0.0.0.1.2.2 n;;;;.;d.

2- ,

3' O.0.5.1.2.0 0;;;..;d.

4.  ;

5 M .5.1.2.5  ::::; /:.d . j 6 -

7 3.9.5.2' The financial assurance arrangements required by

-S RH 3.9.5.1.1 shall be furnished to, and in a form approved  !

9 by,' the Department prior to the issuance of a license, or 10 any amendment or renewal of an existing license, as required 11 by the Department. The applicant shall furnish evidence of I i

12 initial and continued financial responsibility sufficient to 13 maintain the financial assurance arrangement in force, as 14 required by and acceptable to the Department. The amount of 15 funds to be provided by such financial assurance 15 arrangements shall be based on Department-approved cost mk qs.17

~

17 estimates. g,)

18 S:1f incur :::, :: ny crr:ng::ent .+.ich ::::nti:11y *% y 19 cen:titute: ::1f in;;r n;; ' .5  : ;;nts t with : Ctzt: Or j 20  !':d:::1 g:ncy', vill n:t ::ticfy the fin:nri:1 :::::= :0 l l

21 r;q;irc;;nt cin;; thi; pr --id:: n Odditional ::ur:ne I

22 Other th:n th:t "hich circ:dy : ict: through lic:n:: i 23 req;ircm:nts.

l 1

25 i Acceptable financial assurance arrangements include:

26.

27 3.9.5.2.1~ A bond issued by a fidelity or surety company wi'*1 l

28- provisions and for a term and amount acceptable wo the )

29.. ' Department; j j

30 3 - 29 i

I

-J I

s.. j DRAFT July 3, 1996 1 3.9.5.2.2 An irrevocable " letter of credit" or "line of credit" 2 issued by a recognized financial institution whose 3 financial condition and commitment are established to 4 the satisfaction of the Department; 5

6 3.9.5.2.3 A cash deposit, certificate of deposit, or deposit of 7 government securities posted by the licensee with a provisions and for a term and amount acceptable to the 9 Department; or 10

~

11 3.9.5.2.4 SELF ASSURANCE TEST l l

12 3.9.5.2.4.1 A PARENT COMPANY GUARANTEE OF FUNDS FOR 13 DECOMMISSIONING COSTS BASED ON A FINANCIAL TEST MAY BE 14 USED IF THE GUARANTEE AND TEST ARE AS CONTAIN'. ? IN 15 APPENDIX A OF THIS PART. A PARENT COMPANY GU UANTEE

'16 MAY NOT BE USED IN COMBINATION WITH OTHER FIN:'!CIAL 17 METHODS TO SATISFY THE REQUIREMENTS OF THIS SECTION.

18 19 3.9.5.2.4.2 A GUARANTEE OF FUNDS BY THE APPLICANT OR LICENSEE FOR I

20 DECOMMISSIONING COSTS BASED ON A FINANCIAL TEST MAY BE l 21 USED IF THE GUAR 2IITEE AND TEST ARE AS CONTAINED IN 22 APPENDIE B OF THIS PART. A GUARANTEE BY THE APPLICANT 23 OR LICENSEE MAY NOT BE USED IN COMBINATION WITH ANY 24 OTHER FINANCIAL METHODS TO SATISFY THE REQUIREMENTS OF 25 THIS SECTION OR IN ANY SITUATION NHERE THE APPLICANT 26 OR LICENSEE HAS A PARENT COMPANY HOLDING MAJORITY )

27 CONTROL OF THE VOTING STOCK OF THE COMPANY.

28 l 29 3 - 30 l

DRAFT July 3, 1996 1 3.9.5.2.4 5 EXCEPT FOR THE FINANCIAL ASSURANCE TESTS NOTED IN'RE.<

\C

/% ,

2 +3.9.5.2.4, Geombinations of the above o 1ruch othe' vidence m

p 3 of initial and continued financial responsibility as may V

4 required by the Department, including financial assurance 5 arrangements previously provided to any State, Federal e

6 and/or local governing bodies concerning activities subject 7 to license under these regulations, where the amount, terms,

! e and conditions of such financial assurance arrangements have

! 9 been established to the satisfaction of the Department, 10 provided such arrangements are considered by the Department 11 to be adequate to satisfy the requirements of RH 3.9.5 and 12 provided that the portion of the financial assurance

13 arrangement which covers the decommissioning and reclamation  ;

i 14 of the facility and associated areas, and the long-term site

' surveillance and control funding charge, are clearly 15 16 identified and committed for use in accomplishing these i

activities. ~~) l

& cf { f(n

.7 pg, j w s/tw e '1 18 h , c}\ t gi 19 3.9.5.3 The amount of funds t.o be provided by financial 20 assurance arrangements shall be based on Department-approved 21 cost estimates in an approved DECONNISSIONING plan for (1) 22 y /decontaminationanddecommissioningofbuildings, facilities 23 5 s and the site to leve s-which would low unrestricted use of S

84 4.s' these areas upon de mmissioning, and (2) for n 4 25 reclamation of tail ngs and/or waste disposal areasD9 119 @@

! 26 accordance with technical criteria del indated in Part 1 gjl

.27 and/or Part s appropriate. The licensee shall submit 88 this plan and complete proposed financial assurance 29 arrangements in conjunction with the environmental report 30 3 - 31 1

j DRAFT July 3, 1996 1 required by RH 3.8.8 that addresses the expected 2 environmental impacts of the operation, decommissioning and 3 reclamation, and evaluates alternatives for mitigating these 4 impacts. In establishing specific financial assurance 5 arrangements, the cost estimates shall take into account ,

6 total costs that would be incurred if an independent i J

7 contractor were hired to perform the decommissioning and 8 reclamation work, and long-term care if inpit1'd'ed. 1 ftp q ht CJ

? 9 d 10 3.9.5.3.1 EACM DSCOtstISSIONING FUNDING PLAN NUST CONTAIN A COST 11 ESTINATE FOR DECOMMISSIONING, REQUIRED IN THIS 12 SECTION, INCLUDING NEANS FOR ADJUSTING COST ISTINATES 1 13 AND ASSOCIATED FUNDING LEVELS PERIODICALLY OVER THE 14 LIFE OF THE FACILITY. THE DECONNISSIONING FUNDING hg 'e-15 PLAN NUST ALSO INCLUDE A CERTIFICATION JY THE LICENSEE 4 A' l 16 \ THAT FINANCIAL ASSURANCE DECONNISSIONING MAS BREN 17 PROVIDED FOR IN THE ANOUNT OF THE COST ISTINATE FOR 18 DECOMMISSIONING OR A SIGNED ORIGINAL OF THE FINANCIAL ,

19 INSTRUNINT OBTAINED TO SATISFY THE K::QUIREMENTS OF l 20 THIS SECTION.

21 23 3.9.5.3.2 A SJGNED EXECUTED ORIGINAL COPY OF THE FINANCIAL 23 INSTRUN?MT OBTAINED TO SATISFY THE REQUIRENENTS OF 24 b -

THIS SECT 1on SHALL BE SUBNITTED TO THE DEPARTMEbrf k.9' 0

25 PRIOR TO RECEI.?T, USE, POSSESSION, STORAGE OR DISPOSAL 26 OF LICENSED MATERIAL.

27 2e 3 - 32 I

I

, c.

DRAFT July 3, 1996 1- 3.9.5.4 The licensee shall provide in writing to the Department, no 2 later than June 30th of each calendar year, any licensee 3 proposed changes, including updated plans, costs or surety 4 mechanisms, for consideration by the Department.

5 .

6 3.9.5.5 The licensee's financial assurance arrangements will be 7 reviewed annually by the Department to assure that a sufficient funds would be available for completion of the 9 plans if the work had to be performed by an independent 10 contractor and shall be adjusted to recognize any increases 11 or decreases resulting from inflation or deflation, changes 12 in engineering plans, activities perfo.med, and any other 13 L h b) conditions affecting costs. Regardless of whether the work 14 is phased through the life of the operation or takes place 15 at the end of the operation, an eppropriate portion of 86 financial assurance liability shall be retained by the fm 17 licensee until final compliance with the r6clamation plan is 1E determined by the Department. (( $ 9 19 4 gtb -

20 This will yield a financial assurance ARRANGEMENTS that are 31 at least sufficient at all times to cover the costs of P,

33 decommissioning and reclamation of the areas that are t-83 expected to be disturbed before the next license renewal.

24 N4 The term of the surety mechanism shall be open ended, unless y p 25 <7 0 ' it can be demonstrated that another arrangement would 26 provide an equ.4'alent level of assurance. This assurance 27 would be provided with a surety instrument whic? is written as for a specified period of time (e.g. 5 years) yet which must 89 be automatically renewed unless the surety notifies the 30 3 - 33

i .

l . *', .

i i

DRAFT July 3, 1996

! ~1 Department and the principal (the licensee) some reasonable

{ 2 time (e.g. 90 days) prior to the renewal date of their

3 intention not to renew. In such a situation I

4 the surety requirement still exists and the licensee would ,

5 be required to submit _an acceptable replacement surety 6 within a brief period of time to allow at least 60' days for 7 the regulatory agency to collect.

S a 9 Proof of forfeiture shall not be necessary to collect the i j 10 surety so that in the event that the licensee could not

1. a i provide an acceptable replacement surety within the required 11 12 time, the surety shall be automatically collected prior to 13 its expiration. The conditions described above would have 14 to be clearly stated on any surety instrument.which is not 15 open-ended and must be agreed to by all parties.

16 2,7 3.9.5.6 The term of the financial assurance arrangement shall be for )

18 the period from issuance of the license until termination of 19 the license by the Department, unless it can be demonstrated 20 that another arrangement would provide an equivalent level l 21 of assurance. THE LICENSEE SHALL NAINTAIN IN EFFECT ALL 23 DECOBOEISSIONING FINANCIAL ASSURANCES ESTABLISHED BY THE 83

( LICENSEE, PURSUANT TO SECTION Sa9;5 OFsTEIS.PART, IN 24  %' CONJUNCTION NITH A LICENSE ISSUANCE, ANENDNENT OR RENENAL.

25 f THE AMOUNT OF FINANCIAL ASSURANCE NUST BE INCREASED OR 26 DECREASED, AS APPROPRIATE, TO COVER THE DETAILED COST 27 ESTINATE FOR DECOletISSIONING ESTABLISHED PURSUANT TO'SECTION 28 <3.9.5.3 OF THIS:PART. ANY LICENSEE NHO 29 3 - 34 r

. - _ - __________________i

DRAFT July 3, 1996 1 MAS NOT PROVIDED FINANCIAL ASSURANCE TO COVER THE DETAILED 2 g h_ --COST ESTIMATE SUEMITTED WITH THE DECOMMISSIONING PLAN SHALL 3 DO SO NMEN THIS RULE RECOMES EFFECTIVE T ~"*"" 1, 10 0 .

4 FOLLONING APPROVAL OF THE DECOMMISSIONING PLAN, A LICENSEE 5 MAY REDUCE THE AMOUNT OF FINANCIAL ASSURANCE AS 6 DECOMMISSIONING PROCEEDS AND NITH THE APPROVAL OF THE 7 4 DEPARTMENT.

8 9

10 11 12 13 3 - 35

}

i f --

I: DRAFT July 3, 1996 1

4 1 1 3.15.4 NOTICE AND DISPOSITION OF RECORDS PRIOR TO LICENSE TERMINATION.

}

2 3 Each licensee shall notify the Department in writing when the 4 licensee decides to permanently discontinue all activities 5 involving materials authorized under the license.

4 4

6 i

j 7 3.15.4.1 PRIOR TO LICENSE TERMINATION, EACH LICENSEE AUTHORIEED TO 8 POSSESS RADIOACTIVE MATERIAL WITH A HALF-LIFE GREATER THAN 9 30*b 120 DATS, IN AN UNS=rmn rORx, SHALL rORNARD TnE roi.LONING 1 10 RECORDS TO THE DEPARTMENT.

11 12 3.15.4.1.1 RECORDS OF DISPOSAL OF LICENSED MATERIAL MADE UNDER RE 4.34, 13 4.35, 4.36, 4.37; AND j 14 15 3.15.4.1.2 RECORDS REQUIRED BY RH 4.42. l l

16 I 17' 3.15.4.2 IF LICENSED ACTIVITIES ARE TRANSFERRED OR ASSIGNED IN 18 (p, ACCORDANCE WITH RH 3.15.2, EACH LICENSEE AUTHORIZED TO 19 POSSESS RADIOACTIVE MATERIAL, WITH A HALF-LIFE GREATER THAN 80 120 DAYS, IN AN UNSEALED FORM, SMALL TRANSFER THE RECORDS 2A V 82 REQUIRED IN RH 3.15.4.1 TO THE NEN LICENSEE AND THE NEN 33 LICENSEE WILL BE RESPONSIBLE FOR MAINTAINING THESE RECORDS 34 UNTIL THE LICENSE IS TERMINATED.

25 h,5 ( A)(U M 30.6l (2)(Ll OEC crA} l 26 3.15.4.3 PRIOR TO LICENSE TERMINATION, EACH LICENSEE SHALL FORNARD j 27 THE RECORDS REQUIRED BY RH 3.16.6.8 TO THE DEPARTMENT.

28 h' 29 30 3 - 60

t J

, l DRAFT ,

July 3, 1996 1 3.16.6.8 DRCONNISSIONING RECORDKEEPING 2

3 y.N THE LICENSEE SHALL KEEP RECORDS OF INFORMATION IMPORTANT TO 4 THE DECOMMISSIONING OF A FACILITY IN AN IDENTIFIED LOCATION 5 UNTIL THE SITE IS RELEASED R UNRESTRICTED USE. BEFORE 6 [ LICENSED ACTIVITIES ARE TRANSFERRED OR ASSIGNED IN 7 g ACCORDANCE NITH RH 3.15.2, LICENSEES SHALL TRANSFER ALL 8- RECORDS DESCRIBED IN THIS PARAGRAPH TO THE NEW LICENSEE. IN

{

9 / THIS CASE, THE NEW LICENSEE WILL BE RESPONSIBLE FOR 10 MAINTAINING THESE RECORDS UNTIL THE LICENSE IS TERMINATED.

11 IF RECORDS IMPORTANT TO THE DECOMMISSIONING OF A FACILITY 12 ARE KEPT FOR OTHER PURPOSES, REFERENCE TO THESE RECORDS AND 13 THEIR LOCATIONS MAY BE USED. INFORMATION CONSIDERED 14 IMPORTANT TO DECOMMISSIONING CONSISTS OF:

15 16 3.16.6.8.1 RECORDS OF S G LLS OR OTHER UNUSUAL OCCURRENCES INVOLVING THE

17 SPREAD OF CONTAMINATION IN AND AROUND THE FACILITY, 18 EQUIPMENT, OR SITE. THESE RECORDS MAY BE LIMITED TO 19 INSTANCES WHEN CONTAMINATION REMAINS AFTER ANY CLEANUP 20 PROCEDURES OR WHEN THERE IS REASONABLE LIKELIHOOD THAT l 21 CONTAMINANTS MAY HAVE SPREAD TO INACCESSIBLE AREAS AS IN THE i 22 CASE OF POSSIBLE SEEPAGE INTO POROUS MATERIALS SUCH AS 23 CONCRETE. THESE RECORDS MUST INCLUDE ANY KNOWN INFORMATION j

24 ON IDENTIFICATION OF INVOLVED NUCLIDES, QUANTITIES, FORMS

[

25 AND CONCENTRATIONS.

26 27 3.16.6.8.2 AS-BUILT DRAWINGS AND MODIFICATIONS OF STRUCTURES AND 28 EQUIPMENT IN RESTRICTED AREAS WHERE RADIOACTIVE MATERIALS l

! 29 ARE USED AND/OR STORED, AND OF LOCATIONS OF POSSIBLE l 30 3 - 64 l

4

DRAFT July 3, 1996 4

1 INACCESSIBLE CONTAMINATION SUCH AS BURIED PIPES WHICH MAY BE 2 SUBJECT TO CONTAMINATION.. MF REQUIRED DRAWINGS ARE 3 REFERENCED, EACH RELEVANT DOCUMENT NEED TO BE INDEXED l

4 INDIVIDUALLY. IF DRAWINGS ARE NOT AVAILABLR, THE LICENSEE 5- SHALL SUBSTITUTE APPROPRIATE RECORDS OF AVAILABLE 6 INFORMATION CONCERNING THESE AREAS AND LOCATIONS.

]'

i 7

j 8 3.16.6.8.3 EXCEPT FOR AREAS CONTAINING ONLY SEALED SOURCES (PROVIDED d

) 9 k THE SOURCES NAVE NOT LEARED OR NO CONTAMINATION REMAINS i

10 AM tu d AFTER ANY LEAR) OR BYPRODUCT MATERIALS HAVING ONLY HALF-11 k LIVES OF LESS THAN 65 DAYS, A LIST CONTAINED IN A SINGLE 12 DOCUMENT AND UPDATED EVERY 2 YEARS, OF THE FOLLOWING:

(A l 13

}

j 14 3.16.6.8.3.1 ALL AREAR DESIGNATED AND FORNERLY DESIGNATED j 15 RESTRICTED AREAS AS DEFINED IN RH 1.4; 1

16 17 3.16.6.8.3.2 ALL AREAS OUTSIDE OF RESTRICTED AREAS THAT

! 18 REQUIRE DOCUNINTATION UNDER RH 3.16.6.8.1; f1,. 19 20 3.16.6.8.3.3 ALL AREAS OUTSIDE OF RESTRICTED AREAS WHERE CURRENT 21 AND PREVIOUS NASTES HAVE BEEN BURIED AS DOCUMENTED 22 UNDER RH 4.48; AND j 23

, 24 3.16.6.8.3.4- ALL AREAS OUTSIDE OF RESTRICTED AREAS WHICH CONTAIN j 25 MATERIAL SUCH THAT, IF THE LICENSE EXPIRED, THE 26 LICENSEE WOULD BE REQUIRED TO RITHER DECONTAMINATE THE i

27 AREA TO UNRESTRICTED RELEASE LEVELS OR APPLY FOR 28 APPROVAL FOR DISPOSAL UNDER RH 4.34.

39 t-30 3 - 65 i

o

-; _ _ _ . _ .._n..__ .________,

--. . .. . . . . _- . . - - . - - . . ,. _ .~

.. ' . . ,- i

..  : , 1 i

DRAFT July 3, 1996 I

1 3.16.6.8.3.5 A LIST CONTAINING THE LOCATION AND DESCRIPTION OF ALL j

2 . EQUIPMENT TO REMAIN ONSITE AFTER LICENSE TERMINATION 3 THAT NAS CONTAMINATED WHEN FINAL DECOMMISSIONING NAS  !

4 INITIATED AND i 5 6 3.16.6.8.3.6 ANY OTHER INFORMATION NOT REQUIRED BY RH 3.16.6.8.3 l l

7 THAT IS CONSIDERED NECESSARY TO SUPPORT THE ADEQUACY l

8 OF THE DECOMMISSIONING PLAN FOR APPROVAL.

I

9

10 3.16.6.8.4 RECORDS OF THE COST ESTIMATE PERFORMED FOR THE DECOMMISSIONING 11 FUNDING PLAN OR OF THE AMOUNT CERTIFIED FOR DECOMMISSIONING, AND q

j 12 RECORDS OF THE FUNDING METHOD USED FOR ASSURING FUNDS IF EITHER A 1

13 FUNDING PLAN OR CERTIFICATION Is USED.

14 2

15 I 16 17 18 19 20 i

j 21

! 22 33 I

24 35

26 i

l 27 l 28

29 3 - 66 1

I J

'k I

/

DRAFT July 3, 1996 '

k ekk SO , Af 1 %PART-3' 2

T*

3 APPENDIE A 4

5 CRITERIA RELATING TO USE OF FINANCIAL 6 TESTS AND PARENT COMPANY GUARANTEES FOR 7 PROVIDING REASONABLE ASSURANCE 8 OF FUNDS FOR DECOMMISSIONING 9

10 11 12 I. INTRODUCTION 13 14 AN APPLICANT OR LICkWSEE MAY PROVIDE REASONABLE ASSURANCE OF THE 15 AVAILABILITY OF FUNDS FOR DECOMMISSIONING BASED ON OBTAINING A PARENT 16 COMPANY GUARANTEE THAT FUNDS WILL BE AVAILABLE FOR DECOMMISSIONING COSTS 17 AND ON A DEMONSTRATION THAT THE PARENT COMPANY PASSES A FINANCIAL TEST.

I 18 THIS APPENDIE ESTABLISHES CRITERIA FOR PASSING THE FINANCIAL TEST AND

19 FOR OBTAINING THE PARENT COMPANY GUARANTEE.

I 20

21 II. FINANCIAL TEST

22 23 A. TO PASS THE FINANCIAL TEST, THE PARENT COMPANY MUST MEET THE 1

24 CRITERIA OF EITHER PARAGRAPH A.1. OR A.2. OF THIS SECTION:

25 26 1. THE PARENT COMPANY MUST HAVI:

27 28 (I) TWO OF THE FOLLOWING THREE RATIOS: A RATIO OF TOTAL 29 LIABILITIES TO NET WORTH LESS THAN 2.0; A RATIO OF THE 3 - 92

- ~ . . . - . . . . . . . . .. - .- .- - - -.

i p_R A P T July 3, 1996 1

1 1

4 1 SUN OF NET INCOME PLUS DEPRECIATION, DEPLETION, AND j 2 3 AMORTIEATION TO TOTAL LIABILITIES GREATER THAN 0.1s 3 AND RATIO OF CURRENT ASSETS TO CURRENT LIABILITIES 4 GREATER THAN 1.5; AND j 5 4

6 (II) NET NOREING CAPITAL AND TANGIBLE NET NORTH EACH AT 4

7 LEAST SIX TIMES THE CURRENT DECOMMISSIONING COST 8 BSTIMATES (OR PRESCRIBED AMOUNT IF A CERTIFICATION IS 9 USED)s AND 10

} 11 (III) TANGIBLE NET NORTH OF AT LEAST $10 MILLIONS AND 12 13 (IV) ASSETS LOCATED IN THE UNITED STATES AMOUNTING TO AT 14 LEAST 90 PERCINT OF TOTAL ASSETS OR AT LEAST SIX TIMES 15 THE CURRENT DECOMMISSIONING COST ESTIMATES (OR 16' PRESCRIBED AMOUNT IF A CERTIFICATION IS USED).

17 18 2. THE PARENT COMPANY MUST HAVE: l 4 l 19 + 1 30 (I) A CURRENT RATING FOR ITS MOST RECENT BOND ISSUANCE OF i

i 21 AAA, AA, A, OR BBB AS ISSUED BY STANDARD AND POOR'S OR 22 AAA, AA, A, OR BAA AS ISSUED BY MOODY'S; AND 23 l 24 (II) TANGIBLE NET NORTH AT LEAST SIX TIMES THE CURRENT l i

85 DECOMMISSIONING COST ESTIMATE (OR PRESCRIBED AMOUNT IF 36 A CERTIFICATION IS USED); AND I l

J 27 38 (III) TANGIBLE NET NORTH OF AT LEAST $10 MILLION AND 39 3 - 93 l i

l l

i i

, ..a;.-.. _

i DRAFT July 3, 1996 1 .(IV) ASSETS' LOCATED IN THE UNITED STATES AMOUNTING TO AT

. 2 LEAST 90 PERCENT OF TOTAL ASSETS OR AT LEAST SIX TIMES l

i 3 THE CURRENT DECOMMISSIONING COST ESTIMATES (OR

} 4 PRESCRIEED AMOUNT IF CERTIFICATION IS USED).

l 5 4-6 B. THE PARENT COMPANY'S INDEPENDENT CERTIFIED PUBLIC ACCOUNTANT MUST i 7 MAVE COMPARED THE DATA USED BY THE PARENT COMPANY IN THE FINANCIAL 8 TEST, WEICH IS DERIVED FROM INDEPENDENTLY AUDITED, YEAR END i

9 FINANCIAL STATEMENTS FOR THE LATEST FISCAL YEAR, WITH THE AMOUNTS

$ 10 IN SUCH FINANCIAL STATEMENT. IN CONNECTION WITH THAT PROCEDURE

11 THE LICENSEE SHALL INFORM THE

DEPARTMENT,WITHIN 90 DAYS OF ANY 1

i 12 MATTERS COMING TO THE AUDITOR'S ATTENTION WHICH CAUSE THE AUDITOR

{ 13 TO BELIEVE THAT THE DATA SPECIFIED IN THE FINANCIAL TEST SHOULD BE i

j 14 AD.7USTED AND THAT THE COMPANY NO LONGER PASSES THE TEST.

o J 15 -

16 C.- 1. AFTER THE INITIAL FINANCIAL TEST, THE PARENT COMPANY MUST

'17 REPEAT THE PASSAGE OF THE TEST WITHIN 90 DAYS AFTER THE 18 CLOSE OF EACH SUCCEEDING FISCAL YEAR.

19 1

20 2. IF THE PARENT COMPANY NO LONGER MEETS THE REQUIREMENTS OF 21 PARAGRAPH A OF THIS SECTION, THE LICENSEE MUST SEND NOTICE

f. 33 TO THE DEPARTMENT OF INTENT TO ESTABLISH ALTERNATE FINANCIAL

! 23 ASSURANCE AS SPECIFIED IN THE< DEPARTMENT 8S' REGULATIONS. THE

}

. 34 NOTICE MUST BE SENT BY CERTIFIED MAIL WITHIN 90 DAYS AFTER

, 25 THE END OF THE FISCAL YEAR FOR WHICH THE YEAR END FINANCIAL 36 DATA SHON THAT THE PARENT COMPANY NO LONGER MEETS THE 27 FINANCIAL TEST REQUIREMENTS. THE LICENSEE MUST PROVIDE 28 ALTERNATE FINANCIAL ASSURANCE WITHIN 120 DAYS AFTER THE END 29 OF SUCH FISCAL YEAR.

l 3 - 94 4

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DRAFT July 3, 1996 1 III. PARENT COMPANY GUARANTEE 2

1 3 THE TERNS OF A PARENT CONPANY GUARANTEE WHICH AN APPLICANT OR LICENSEE 4 OBTAINS NUST PROVIDE THAT:

5 6 A. THE PARENT CONPANY GUARANTEE WILL RENAIN IN FORCE UNLESS THE 4

7 GUARANTOR SENDS NOTICE OF CANCELLATION BY CERTIFIED MAIL TO THE 8 LICENSEE AND THE'DEPARTNENT. CANCELLATION NAY NOT OCCUR, HOWEVER, 3

9 DURING THE 120 DAYS BEGINNING ON THE DATE OF RECEIPT OF THE NOTICE 10 OF CANCELLATION BY BOTH THE LICENSEE AND THE DEPARTNENT, AS 11 EVIDENCED BY THE RETURN RECEIPTS.

12 I 13 B. IF THE LICENSEE FAILS TO PROVIDE ALTERNATE FINANCIAL ASSURANCE AS 14 SPECIFIED IN THE DEPARTNENT's. REGULATIONS WITHIN 90 DAYS AFTER 15 RECEIPT BY THE LICENSEE AND DEPARTNINT OF A NOTICE OF CANCELLATION 16 OF THE PARENT CONPANY GUARANTEE FRON THE GUARANTOR, THE GUARANTOR A7 WILL PROVIDE SUCH ALTERNATIVE FINANCIAL ASSURANCE IN THE NANE OF l l

18 THE LICENSEE. l p \qf-19 9 1 U

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l DRAFT July 3, 1996 g

L # h)Y 1 1  ;;PART:3s v-5Q j

ff 3 APPENDIX B e( ,

4 4

, 5 CRITERIA RELATING TO USE OF 6 FINANCIAL TESTS AND SELF GUARANTEES FOR

7 PROVIDING REASONABLE ASSURANCE OF FUNDS FOR DECOMMISSIONING 1

)

8 9

, 10 I. INTRODUCTION l

't 11 1 1

) 12 AN APPLICANT OR LICENSEE MAY PROVIDE REASONABLE ASSURANCE OF THE l 13 AVAILABILITY OF FUNDS FOR DECOMMISSIONING EASED ON FURNISHING ITS ONN 14 GUARANTEE THAT FUNDS WILL BE AVAILABLE FOR DECOMMISSIONING COSTS AND ON

]

15 A DEMONSTRATION THAT THE COMPANY PASSES THE FINANCIAL TEST SECTION OF O

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.i. 16 THIS APPENDIX. THE TERMS OF THIS SELF-GUARANTEE ARE IN SECTION III F 4 J 17 THIS APPENDIX. THIS APPENDIX ESTABLISHES CRITERIA FOR PASSING 18 FINANCIAL TEST FOR THE SELF-GUARANTEE AND ESTABLISHES THE TERMS FOR A 19 SELF-GUARANTEE.

20 21 II. FINANCIAL TEST 22 23 A. TO PASS THE FINANCIAL TMST, A COMPANY MUST MEET THE ALL OF THE 24 FOLLOWING CRITERIA:

25 26 1. A TANGIBLE NET WORTH OF AT LEAST TEN TIMES THE TOTAL CURRENT 27 DECOMMISSIONING COST ESTIMATE (OR THE CURRENT AMOUNT 28' REQUIRED IF CERTIFICATION IS USED) FOR ALL DECOMMISSIONING 29 ACTIVITIES FOR WHICH THE COMPANY IS RESPONSIBLE AS SELF-0 3 - 96 j

\ . l DRAFT July 3, 1996 4

i I 1 GUARANTEEING LICENSEE AND AS PARENT-GUARANTOR.

2 f 3 2. ASSETS LOCATED IN THE UNITED STATES AMOUNTING TO AT LEAST 90 4 PERCENT OF TOTAL ASSETS OR AT LEAST TEN TIMES THE CURRENT 4

5 DECOMMISSIONING COST ESTIMATES (OR THE CURRENT AMOUNT 6 REQUIRED IF CERTIFICATION IS USED) FOR ALL DECOMMISSIONING l 7 ACTIVITIEP FOR NHICH THE COMPANY IS RESPONSIBLE AS SELF-8 GUARANTGING LICENSEE AND AS PARENT-GUARANTOR.

9 10 3. A CURRENT RAi'ING FOR ITS MOST RECENT BOND ISSUANCE OF AAA, 11 AA, OR A AS ISSUED BY STANDARD AND POOR'S OR AAA, AA, OR A 12 AS ISSUED BY MOODY'S; AND 13 14 B. TO PASS THE FINANCIAL TEST, A COMPANY MUST MEET ALL OF 15 THE FOLLONING ADDITIONAL REQUIREMENTS:

l 16 )

17 (1) THE COMPANY MUST HAVE AT LEAST ONE CLASS OF 18 EQUITY SECURITIES REGISTERED UNDER THE 19 SECURITIES EXCHANGE ACT OF 1934. l l

20 21 (2) THE COMPANY'S INDEPENDENT CERTIFIED PUBLIC 22 ACCOUNTANT MUST HAVE COMPARED THE DATA USED BY 23 THE COMPANY IN THE FINANCIAL TEST WHICH IS I

24 DERIVED FROM THE INDEPENDENTLY AUDITED, YEAR END 25 FINANCIAL STATEMENTS FOR THE LATEST FISCAL YEAR, 26 WITH THE AMOUNTS IN SUCH FINANCIAL STATEMENT.

27 IN CONNECTION WITH THAT PROCEDURE, THE LICENSEE 28 SHALL INFORM THE-DEPARTMENT,WITHIN 90 DAYS OF 29 ANY MATTERS COMING TO THE ATTENTION OF THE 3 - 97 b --

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DRAFT July 3, 1996 1 AUDITOR THAT CAUSE THE AUDITOR TO BELIEVE THAT 1

2 THE DATA SPECIFIED IN THE FINANCIAL TEST SHOULD 3 BE ADJUSTED AND THAT THE COMPANY NO LONGER 4 PASSES THE TEST.

1 5 1 6 (3) AFTER THE INITIAL FINANCIAL TEST, THE COMPANY 7 MUST REPEAT PASSAGE OF THE TEST NITHIN 90 DAYS 8 AFTER THE CLOSE OF EACH SUCCEEDING FISCAL YEAR.

9 10 C. IF THE LICENSEE NO LONGER MEETS THE REQUIREMENTS OF SECTION 11 II.A. OF TEIS APPENDIE, THE LICENSEE MUST SEND IMMEDIATE I

12 NOTICE TO THE, DEPARTMENT,OF ITS INTENT TO ESTABLISH  !

13 ALTERNATE FINANCIAL ASSURANCE AS SPECIFIED IN THE 14 (DEPARTMENT's,REGUL&TIONS NITHIN 120 DAYS OF SUCH NOTICE.

15 16 III. COMPANY SELF-GUARANTEE 17-18 THE TERMS OF A SELF-GUARANTEE NEICH AN APPLICANT OR LICENSEE FURNISHES

, 19 MUST PROVIDE THAT:

i 4

20 4

21 .A. THE GUARANTEE NILL REMAIN IN FORCE UNLESS THE LICENSEE SENDS 22 NOTICE OF CANCELLATION BY CERTIFIED MAIL TO THE DEPARTMENr.'

23 CANCELLATION MAY NOT OCCUR, HONEVER, DURING THE 120 DAYS BEGINNING r

24-ON THE DATE OF RECEIPT OF THE NOTICE OF CANCELLATION BY THE i

25 < DEPARTMENT, AS EVIDENCED BY THE RETURN RECEIPT.

26 27 B. THE LICENSEE SHALL PROVIDE ALTERNATIVE FINANCIAL ASSURANCE AS 28 SPECIFIED IN TRE' DEPARTMENT'S REGULATIONS.NITHIN 90 DAYS FOLLONING l 29 RECEIPT BY THE DEPARTMENT OF A NOTICE OF CANCELLATION OF THE 4

3 - 98

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l DRAFT July 3, 1996 i

! 1 GUARANTEE.

2 l 3 C. THE GUARANTEE AND FINANCIAL TEST PROVISIONS MUST REMAIN IN EFFECT 4 UNTIL THE DEPARTMENT HAS TERMINATED THE LICENSE OR UNTIL ANOTHER 1 5 FINANCIAL ASSURANCE METHOD ACCEPTABLE TO THE DEPARTMENT HAD BEEN 6 PUT IN EFFECT BY THE LICENSEE.

. I 7 +

8 D. THE LICENSEE WILL PROMPTLY FORWARD TO THE DEPARTMENT.AND THE 3 9 LICENSEE'S INDEPENDENT AUDITOR ALL REPORTS COVERING THE LATEST '

10 FISCAL YEAR FILJD BY THE LICENSEE WITH THE SECURITIES AND EXCHANGE 11 COMMISSION PURSUANT TO THE REQUIREMENTS OF SECTION 13 OF THE .

i 12 SECURITIES AND EXCHANGE ACT OF 1934.  ;

13 14 E. IF, AT ANY TIME, THE LICENSEE'S MOST RECENT BOND ISSUANCE CEASES 15 TO BE TE IN ANY CATEGORY OF "A" OR ABOVE BY EITHER STANDARD AND f.

16 POORS AND MOODYS, THE LICENSEE WILL PROVIDE NOTICE IN WRITING OF 17 SUCH FACT TO THE DEPARTMENT WITHIN 20 DAYS AFTER PUBLICATION OF 18 THE CHANGE BY THE RATING SEPVICE. IF THE LICENSEE'S MOST RECENT 19 BOND ISSUANCE CEASES TO BE RATED IN ANY CATEGORY OF A OR ABOVE BY 20 BOTH STANDARD AND POORS A D MOODYS, THE LICENSEE NO LONGER MEETS 21 THE REQUIREMENTS OF mECTION II.A._OF;THIS: APPENDIX.

l 22 ,

23 F. THE APPLICANT OR LICENSEE NUST PROVIDE "O THE' DEPARTMENT A WRITTEN 24 GUARANTEE (A WRITTEN COMMITMENT BY A CORPORATE OFFICER) WHICH 25 STATES THAT THE LICENSEE WILL FUND AND CARRY OUT THE REQUIRED l

26 DECOMMISSIONING ACTIVITIES OR, UPON ISSUANCE OF AN ORDER BY THE l 27 DEPARTMENT, THE LIC'ENSEE WILL 3ET UP AND FUND A TRUST IN THE 28 AMOUNT OF THE CURRENT COST ESTIMATES FOR DECOMMISSIONING.

29 3 - 99  :

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