ML20133G712

Transcript of 920428 Ofc of State Programs Workshop, Funding Radiation Control Programs W/Emphasis on Fee Schedules Effective Strategies for 1990. Pp 1-250. W/Certificate

ML20133G712
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Issue date:	04/28/1992
From:	NRC OFFICE OF STATE PROGRAMS (OSP)
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NUDOCS 9701160135
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CEG3AL OFFICIAL TRANSCRIPT OF PROCEEDINGS Agency: Nuclear Regulatory Commission Office of State Programs Workshop

.TiCIO: Funding Radiation Control Programs with Emphasis on Fee Schedules Effective Strategies for the 1990's Docket No.

IOCARON:

Bethesda, Maryland DATE:

Tuesday, April 28, 1992 1- 50 PAGES:

D03O l pgg gi.E ESTER COPY gg\ Y 9701160135 920428 PDR STPRC ESGGEN PDR

.160021 ANN RILEY& ASSOCIATES, LTD.

1612 K St N.W. Suite 300 ) b" Washington, D.C 20006 (202) 293-3950

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O 1 UNITED STATES 1

2 NUCLEAR REGULATORY COMMISSION 4

3 ***

, 4 ,

] 5 FUNDING RADIATION CONTROL PROGRAMS  !

t 6 WITH EMPHASIS ON FEE SCHEDULES I 7 EFFECTIVE STRATEGIES FOR THE 1990'S l

, 8  !

9 10 A SPECIAL TOPICS WORKSHOP l

11 BY NRC OFFICE OF STATE PROGRAMS 12 13 ~ Tuesday, April 28, 1992 14 Bethesda Holiday Inn 15 Maryland Room 16 17 18 19 20 21 22 23 24 25

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-V 1 ATTENDANCE

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3 Mr. Aubrey V. Godwin, Director 4 Division of Radiation Control 5 State Department of Public Health 6 State Office Building 7 572~ East Patton Avenue i

8 Montgomery, Alabama 9 l 10 Mr. Jared. Thompson, Supervisor 11 X-Ray Section 12 Division of Radiation Control and Emergency Management ,

f~T 13 Department of Health

'A 14 4815 West Markham Street, Slot ~30

.15 Little Rock, Arkansas 16 17 Mr. Edgar D. Bailey, CHP, Chief, 18 Radiologic Health Branch

-19 Department of Health Services 20 714/744 P Street 21 P.O. Box 942732 22 Sacramento, California 23 24 25 O

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.i g 3-1 ATTENDEES [ CONTINUED) 2 3 Mr. Daniel Nash, Business Manager 4 Radioactive Materials Section 5 Office of Radiation Control and Rehabilitative Services i

6 1317 Winewood Boulevard l 7 Tallahassee, Florida 8

9 Mr. Thomas Hill, Manager 10 Radioactive Materials Program 11 Department of Natural Resc rces 12 4244 International Parkway, Suite 114 13 Atlanta, Georgia

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15 Mr. Bruce W. Hokel, Supervisor l 16 Radioactive Materials Section 17 Bureau of Environmental Health 18 Iowa Department of Public Health 19 Lucas State University 20 Des Moines, Iowa 21 22 23 24 25 O

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O V 4 1 ATTENDEES [ CONTINUED]

2 3 Mr. Hall Bohlinger, Administrator 4 Radiation Protection Division 5 Office of Air Quality and Radiation Protection 6 P.O. Box 82135 7 Baton Rouge, Louisiana 8

9 Mr. Robert M. Hallisey, Director 10 Radiation Control Program 11 Department of Public Health 12 305 South Street Jamaica Plains, MA

[VJ 13 14 15 Mr. Eddie S. Fuente, Director 16 Division of Radiological Health 17 State Department of Health 18 3150 Lawson Street, P.O. Box 1700 19 Jackson, Mississippi 20 21 Mr. Harold R. Borchert, Director 22 Division of Radiological Health 23 Department of Health 24 301 Centennial Mall South, P.O. Box 95007 25 Lincoln, Nebraska O

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D 5 i \v) 1 ATTENDEES (CONTINUED]

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{ 3 Mr. Dennis P. O'Dowd, Supervisor I 4 Radioactive Material Section l

5 Division of Public Health Services 6 Health and Welfare Building 7 6 Hazen Drive 8 Concord, New Hampshire i 9

10 Ms. Jill Lipoti, Assistant Director 11 for Radiation Protection Programs 12 Division of Environmental Quality 13 Department of Environmental Protection 14 CN 415 15 Trenton, New Jersey 16

'17 Mr. William Floyd, Chief 18 Bureau of Hazardous and Radioactive Materials 19 Water'and Waste Management Division 20 Department of Environment 21 P.O. Box 26110 22 Santa Fe, New Mexico 23 24 25 O

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1 ATTENDEES (CONTINUED]

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! 3 Mr. Tim Walker, Supervisor l 4 Radioactive Materials. System 5 Radiological Health Program 6 Department of Health l.

l 7 1224 Kinnear Road 8 Columbus, Ohio 9

4 10 Mr. Ray D. Paris, Manager 2

11 Radiation Control Section l

12 State Health Division 13

( Department of Human Services  !

14 800 N.E. Oregon Street 15 P.O. Box 14450 16 Portland, Oregon 17 l

18 Ms. Shelly Robinson, Chief l 19 Division of Occupational and Radiological Health 20 Department of Health 21 206 Cannon Building 22 3 Capital Hill 23 Providence, Rhode Island l 24 25 I

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!O l- 1 ATTENDEES: (CONTINUED)

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3 Ms. Mary Helen Short 4 ' Division of Radiological Health I 5 TERRA Building, Sixth Floor

) 6 '159 9th Avenue North a.

7 Nashville, Tennessee 8

9 Mr. Terry C. Frazee, Head 10 Radioactive Materials Section 11 Division of Radiation Protection 12 Department of Health - LE-13 Airdustrial Center Building #5

( ) 13 14 P.O. Box 47827 15 Olympia, Washington 16 17 18 19 20 21 22 23 24 I 25 O

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8 l l' PROCEEDINGS-2

[8:30 a.m.] ,

l 3 MR. PARKER: Good morning. Welcome to the second i l  !

l 4- in a series of technical workshops.

Those of you who l 1

l l 5 attended the first workshop on rule and regulation '

6 development, I am' pleased ~to announce that the draft NUREG  :

i t 7 document has been completed and has gone on for what happens '

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8 in every organization, an internal review to make sure that i l 9 whatever we put in there is consistent with law and with the

1 10 policy of the U.S. government. I l

11 Hopefully, that'NUREG document will be out very 1 12 shortly and it certainly will be distributed to all of you, )

()13 those of you who attended and the others as well. We wish 14 to extend our appreciation of the time and effort that went 15 into developing that NUREG document, and we thank all of the 16 people who participated in the first workshop.

-q 17 These workshops, for those of you who are l 18 attending for the first time, are quite different from the 19 usual meetings to which you are invited. You will not hear '

20 a series of lectures to educate you about a particular l 21 subject. Rather, you will be part of the educational i 22 process by participating in the discussions and by 23 exchanging information and ideas with your fellow 24 governmental colleagues.

l-25 For this meeting to be successful we must have l

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1 opc7 and frank discussion. Although we are recording this 2 workshop it is for the convenience of the people who will be 3 putting the report together -- none of your names will be 4 included in the body of the report although'your names _will 5 appear in the front as having attended this workshop.  ;

6 Let's get ready to work. Takt off your jackets, l 7 roll up your sleeves, and let's do it. Hopefully, the

8 results of this meeting could and should lead to a system 9 that will make it easier to collect fees and to get funds j i

10 for a dedicated fund.

j 11 The title of today's workshop, Funding Radiation 12 Control Programs with an Emphasis on Fee Schedules,

,( 13 Effective Strategy for the 1990's is a most appropriate and 14 timely one, as both the Federal and state governments are 15 facing terrible budget constraints, and we may hear more 16 about that during this two day workshop. All agencies must 17 be able to determine what their'true costs are and then to 18 establish fees that will allow them to give the regulated j 19 community a dollars worth for each dollar charged as a fee.

I 20 I think the first thing we would like to take a i

l' 21 look at is, what is the present source of budgetary funds in J

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22 the states whether from appropriation or from fees. This is 23 from the questionnaires that you folks sent back. This does 4

24 not include the three non-agreement states. At the time 25 this went out there were 28 agreement states. There are now l

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1 29, since Maine has core on board. Twenty-three out of the 2 28 agreement states did respond to the questionnaire.

3 The percentage of the budgets range from zero to 4 100 percent as you can see. Four states reported that they 5 received zero from appropriation. They got it all from 6 .either from fees or grants. Four states reported that they 7 recaived 100 percent of the budget from appropriation. A 8 number of states we couldn't determine because ot . .: way 9 the question was responded to. The problem with looking at 10 numbers like this is that we rely too heavily on 11 appropriation which is the subject of the legislature.

12 We have to compete, those of us who were in the

( 13 health departments or were in the health departments, have 14 to compete with programs that are having epidemics such as 15 AIDS and substance abuse and health care for all. And when 16 it comes time when we get into that room with the Ways and 17 Means Committee, it is very difficult for us to compete with 18 those folks. Therefore, it would be nice if we could shift 19 the heavy part. As you can see, about 50 percent of all 20 budgets in states for radiation control come from 21 appropriation.

22 Only about one-third of the budgets come from 23 fees. It would be very nice if we could shift those 24 proportions; that we start getting more of our budget from 25 fees rather than from appropriations.

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l 11 1 MR. SCHWARTZ: I have a question, if I may. Are

. 2 -there any states that do not charge any fees at all and are 3 total appropriations?

e 1 4 MR. PARKER: Four. We have one here in New York.

5 MR. SCHWARTZ: I didn't see it.

6 MR. PARKER

It's up there. The range is zero to.

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7 100 percent, and there are four states that get nothing from i

8 appropriation. They rely all on either fees, contracts or a

i 9 grants. We should strive to shift the emphasis on .

l 10 appropriations and shift it to fees.

11 What is the charge of this workshop? The charge 12 of this workshop is to devise a system to determine what the 13 true real costs are of running a program. Then, to

) 14 establish realistic fees, fees that will bring in sufficient 15 funds to operate the programs that we run. To design a

. 16 computerized system that will minimize the person power that 17 is needed to generate the invoices, to collect the money, 4

18 generate the licenses, and to remit the money that is 19 collected to the Treasury.

20 The final and perhaps the most important charge to 21 this workshop is to learn what strategies have been used by 4

22 the states that have been successful in getting dedicated 23 accounts. There are states that have been able to do it.

J 24 Some states don't get them but some states do.

l 25 The first question is, how does one determine what

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i 12 4 11 the real costs of a program are? In the old days one

, 2 usually determined what the costs of inspections were; that

. 3 is, the time to prepare for an inspection, the travel time, F

j 4 the inspection time and the time to prepare the report. We

j. 5 now realize that these items only cover a portion of the a

6 cost.

7 In addition, there are costs for instruments, the

! 8 purchase, maintenance and repair, the supervisor's time,

9 secretarial and administrative costs, building costs, j 10 energy, telephone, water and maintenance, and the travel l

11 costs including automobiles and their related costs. There 5

12 are also costs for support service such as fiscal and i

( 13 personnel, computing services. Enumerating all of them, I l 14 am sure, there are a lot of other costs that I have i

j 13 neglected to mention.

16 What I have intentionally left out are the costs 17 for developing regulations, meetings with the Regulatory l 18 Advisory Conmittees, the printing and mailing regulations, 19 and the cost for advertising the hearings on the 20 regulations. The reason this cost item was left out is that j

21 cost is sometimes covered by another governmental body.  !

i l 22 When one is determining what the costs are one must include l 23 a sufficient amount to cover this item of developing and j

24 getting your rules promulgated.

25 In addition, the cost of the research that is r  !

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\_ i 1 needed to develop the data for the regulations-must be 2 included. In most cases the states rely on the Federal l 3 government for the research, and we hope that they will.

l 4 continue to do so. Only when one has determined what the ,

5 true costs of running a program are, can one establish l l 6 appropriate fees. l 7 We took a look at six typical states. In your 8 notebook you will find what Oregon did when they sent their 9 letter. In the back of the notebook, the letter that Oregon 10 sent to their regulating community in comparing the NRC fees 11 with Oregon proposed fees. Two people have already told me ,

1 12 -- Jessie Funches, who many of you heard at the meeting in Sacramento talk about fees, and Ray told me this morning at (A} 13 14 breakfast -- maybe it was last night -- that the number that 15 Ray used on the NRC fees and that's the number that I used 16 here, is much too low.

17 Ray, why don't you tell them what you told me last 18 night.

19 MR. PARIS FROM OREGON: What we neglected to do 20 was put in the base cost for the annual fee of the NRC uses.

21 What we included was the inspection time, Part 171 of their 22 base fees. You can add about -- I have the new numbers.

23 MR. PARKER: This is just used for an example.

24 Jessie, what we are doing now is going over the NRC fees 25 with the state fees, and we just started this slide.

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!( 1 Welcome to the people from the Fee Section of NRC.

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We will  !

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j 2 hear from Jessie in a little while.  !

3 We have here the NRC fees which are a gross l

4 underestimation. As I told you, Jessie told me this already i

5 on the phone and Ray affirms that. One state, our good f

6 friend from Alabama, said it would be 75 percent of the NRC 7 fees. So, you see that here. Tom, in your state there's a.

8 proposal that should be .33 of the NRC; is that correct?

9' MR. HILL FROM GEORGIA: Not_quite. The annual fee ]

10 would be, the annual fee only.

11 MR. PARKER: The annual fee would be one-third of .

12 the NRC fee.

()13 MR. HILL FROM GEORGIA: Yes.

14 MR. PARKER: We took six states who responded to 15 the questionnaire and we put down a max, minimum, medium. I 16 looked at this slide and I was horrified. I cannot believe 17 that somebody can run-a program, doing an industrial gage 18 portable one for $75.00. I think it costs more to just 19- write a letter to the people and give out the registration 20 form.

21 The question is, if these are not true costs what 22 are they? What do they represent? You asked the question, 23 Shelly, and you are the one that put your hand up that you l 24 don't have fees? Here, we have New Mexico. New Mexico came 25 in at zero and I couldn't use the zero because zero, you O

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.V 1 can't use in this kind of a form. We know New Mexico, we 2 know New York has zero fees but have'now been given 3' permission. How do these programs operate if they rely 100 4 percent on appropriation? They don't have fees but maybe

5. you have a few grants and stuff, but most of the stuff comes 6 from appropriation. You are at the mercy of the 7 legislature. The legislatures are looking very closely at 8 what they consider non-critical programs. We consider them 9 critical and are doing something in protecting public health 10 and safety but, again, we can't compete against AIDS and 11 some things that I enumerated before.

12- If you take a look at this you will notice that 13

( some of these numbers way over here, the minimums, don't 14 make sense.in many' cases. In some cases the max is a little 15 bit more than what these numbers are but certainly will not 16 be more than the NRC fee if you include the first time as 17 Ray pointed out and as Jessie pointed out to me on the 18 phone.

19 So, the question is, how are we going to determine 20 what the true costs are and get true fees -- that's what the 21 charge to this workshop is -- and then get a dedicated fund 22 and use those fees so that we can give it to the regulated 23 community to get their money worth.

24- I should have done something before. Why don't I 25 interrupt just for a minute. Why don't we go quickly around O .

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1 the table -- it's a bad time to do it. I don't know 2 everybody that is in the room.

3 MR. BORCHERT: Harold Borchert, Nebraska 4 Department of Health.

I 5 MS. ROBINSON: Shelly Robinson, Rhode Island 6 Department of Health.

l l 7 MR. PARIS: Ray Paris, State of Oregon.

8 MR. HOKEL: Bruce Hokel, State of Iowa Department 9 of Health, i

10 MR. O'DOWD: Dennis O'Dowd, State of New 11 Hampshire. l i

12 MR. BOHLINGER: Hal Bohlinger, State of Louisiana, 13 Environmental Quality Department.

! 14 MR. HILL: Tom Hill, Georgia Department of Natural 15 Resources.  !

16 MS. SHORT: Mary Ellen Short. I would like to be 17 Smart, but I am not. Tennessee Division of Radiological 18 Hazards.

l 19 [ Laughter.]

20 MR. FUENTE: Eddie Fuente, Mississippi Department 21 of Health.

22 MR. FRAZEE: Terry Frazee, State of Washington.

23 MR. NASH: Dan Nash, Office of Radiation Control, i

24 Florida.

25 MR. BAILEY: Ed Bailey, Radiologic Health in l

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1 California.

i 2 MR. WALKER: Tim Walker, Ohio Department of l 3- Health.

4 MR. FLOYD: Bill Floyd, New Mexico Department of-s 5 Environment.

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6 MR. MILLER

Vandy Miller, Office of State j 7 Programs.

8 MR. HALLISEY: ~ Bob Hallisey, Radiation Control 9 Program, Massachusetts Department of Public Health.

10 MS. LIPOTI: Jill Lipoti, New Jersey Department of 11 Environmental Protection and Energy.

12 MR. THOMPSON: Jared Thompson, Arkansas Department 13 of Health.

14 MR. GODWIN: Aubrey Godwin, Alabama Department of 15 Health.

16 MR. PARKER: I am Jerry Parker. I recently 17 retired from the field of Radiological Health in the States,  !

18 having been there a little over 41 years. I am now a part-19 time consultant to the Office of State Programs.

20 MR. BLANTON: Dick Blanton, Office of State 21 Programs, formerly with the State of Arizona.

22 MR. HOLLOWAY: Jim Holloway.

23 MR. FUNCHES: Jessie Funches, Deputy Controller.

24 MS. JACKSON: Glenda Jackson, License and Debt 25 Collection.

l' MR. EMIGH: Chuck Emigh, Executive Director for 2 Operations Office.

1 3 MR. UPSHAW: Bill Upshaw.

4 701. SCHWARTZ: Shelly Schwartz, Office of State j i

5 Programs.

6 MS. SHORT FROM TENNESSEE: I just wanted to say l

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7 that in the category that you pointed out, the portable 8- ' gages, apparently the Tennessee fee is not listed there.

9' Our fee is currently for a portable gage license and will be-10 until May 15th, $4,000. 00 -

11 MR. PARKER: As I said, I only picked on six 12 states. I didn't do all the states. Some of them are 13' higher and lower.

( This was just to give you an example. We 14 did not have all the data.

15 MS. SHORT FROM TENNESSEE: As of the 15th, it will 16 be lower. It will be $600.00 for two or fewer gages and 17 $1,400.00 for three or more.

18 MR. PARKER: The point of this slide, I wanted 19 everybody to see, look at what's going on out there.

20 MR. BAILEY FROM CALIFORNIA: Did you get data on 21 reciprocity fees also?

22 MR. PARKER: No, we did not. That's a good point

-23 though, we ought to try that. Might the variability of the 24 fees that you see up there from one state to another cost j 25 the regulated community to cross state lines in order to O

l 1 take advantage of lower fees elsewhere. This is one of the  !

2 issues that prompted us to ask in the questionnaire that we i 4

3 sent to you to think about the question, should there be 4 standardized state fees.

5 Or, perhaps the question should be, should there ,

6 be a minimum state fee so that states can adjust the fees 7 taking into account their own particular circumstances.

8 Also, the regulated community must be asking themselves why 9 the fees in their particular state differ so much from the 1 10 fees in an abutting state.

11 Let's take a look at the area of dedicated funds 12 which is at the bottom of the slide. Of the 23 states that

()13 reported only ten have dedicated funds; 13 do not have it, j 14 and the other five we do not know. Of course, we don't know 15 anything about the non-agreement states. Why have tho e ten 16 states been successful while the 13 have not been 17 successful.

18 In ome states the regulated community has helped i l 19 the programs get dedicated funds while in other states the l i 20 regulated community has fought the effort to get a dedicated 21 fund. During this workshop we will hear from those states 22 that have been successful and from these states who have not

23 been able to get their legislatures to approve such an 24 arrangement. -I think that the time has come for the states 25 to consider the regulated community their ally and not their A

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c 20 b'O 1 adversary when considering the acquisition of a' dedicated 2 fund.

3 It is in the interest of the regulated community 4 that states have an efficient program'with a cost. benefit 5 ratio of less than one. In order to get the regulated 6 community to back our efforts to get dedicated funds, they j l

7 should and probably will, demand annual or semi-annual I 8 audits to guarantee that their funds are being. spent for the 9 purpose for which they were allocated. This is already true.

10 in some states.

11 If we are to get sufficient funds during the 12 1990's to conduct programs that will protect public health

( 13 and safety, then we will have to enlist the help of the 14 regulated community to get adequate' fees and dedicated 15 accountings.

16 The last charge to this workshop relates to 17 computerizing our systems for generating invoices, I 18 collecting fees, issuing licenses and transferring receipts 19 to a fiscal body. One of the things that we should 20 determine is whether the radiation control program has the 21 responsibility for the fee system. My dear friend Greta is 22 not here but I believe she told me in your state, Jared, 23 that you do not have responsibility. Somebody else collects 24 the money. We will hear about that later on during the 25 workshop.

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1 We will also hear from several of the states that 2 have modern,'up to date computerized systems, at least one 3 of which uses scanners in their operation. I believe that

4 we have set a very ambitious agenda for the next day and I

5 one-half. I think unless there are some questions, I would

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l 6 like to turn the first session over to Harry, who will'be l i

7 our leader for Session I.

8 Before I do, let me request that when you speak 9 that you identify yourself and what organization that you 4

10 represent for the convenience of not only Mary but also for 11 the convenience of the people that will be writing the l

12 report. When the report was being written we had to go back

( 13 to some of the states to clarify some of the things that 14 they said during the workshop.

15 Harry, it's all yours. Carl, why don't you 16 identify yourself, t

17 MR. KAMMERER: I am Gerald S. Parker.

18 -[ Laughter.]

19 MR. PARKER: I would like to introduce my fellow

, 20 American, Carl Kammerer.

21 MR. BORCHERT FROM NEBRASKA: Thank you, Gerry. I 22 think what we will do is just kind of get this kicked off 23 and go around the table. We will start with question number l 24 one, and see how long it takes us to go through that 25 question. The question is, how does your state calculate i (~T 4

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[~h 22 G) 1 program costs for budgeting. How are fees, if any, 2 determined. The first speaker is Jessie, and he's going to 3 talk on how NRC does their essessment.

4 MR. PARKER: I should have mentioned that we l l

5 appreciate the time that Jessie Funches, Jim Holloway and j 6 Glenda Jackson have taken to come down here, to explain how 1

7 the NRC does it. Those of you who were in Sacramento, 8 remember Jessie described the fee structure, what was 9 happening, what success they were having in collecting their i

10 fees, how many people were dropping out of the program. j 11 We appreciate the time that Jessie, Jim and Glenda 12 have taken to come down here, to explain how NRC determines

/ 13 fees. You remember from the slides, it's clear to me -- and

14 it must be clear to all of you -- that some of those people 15 who were charging $75.00 for doing an inspection are not 16 true costs. If you are not going to get true costs and you 17 can't get true fees, then you can't have enough money to run 18 your programs.

19 Jessie, go ahead. It's all yours.

20 MR. FUNCHES: What I would do first is talk a 21 little bit about what the constraints we have in terms of 22 what fees we can charge and what legislative constraints we i

23 have on our fees program. I think you will find that the 24 states have different legislative constraints also. Some of 25 the things we do we have to do, because we are constrained f-O]

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. 1 legislatively in doing them. We probably would do them i 2 differently if we didn't have those constraints.

3 Then, I would like to talk a little bit about how

. 4 we'go about what costs and what the components of the costs 4 l 5 that we need to collect through fees. We have to collect-6 100 percent of our budget. That means all costs that are

) 7 appropriated to the NRC. From there, maybe talk in a little l

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-8 bit of detail of how we calculate the fees. The long sheet J

9 that you have here'will give you a good summary. Lastly, I 10 will talk about the specific types of fees which are not 1 11 . listed on the charts that you have. The charts you have are 4

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!' 12' the same ones that I will have here. I i l l 13 The Omnibus Budget Reconciliation Act of last year i 14 basically said that we had to generate revenues to cover our  !

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{ 15 appropriations. We don't keep the fees. It's not a i

{ 16 revolving fund and it's not a trust fund. We basically

.17 serve as the collection agency for the Department of ,

18 Treasury. We get an appropriation, Congress tells us you 19 must recover that appropriation, and give the money to 20 Treasury.

21 In theory, if we collect zero money we will still 22 operate. Congress wouldn't like it, but we would still 23 operate. We don't keep the money that we collect, so we are 24 not operating from that view.

25 We have to recover approximately 100 percent of O

l 1 our budget. Approximately 100 percent gives us -- recognize

2 that there is uncertainty in trying.to estimate how much we 3 are going to collect and how much we actually will collect.

4 For example, many of you know there are people who.didn't 5 pay. We don't penalize other people for people that don't 6 pay. I guess at some point if we get-to a steady state we 7 might try to estimate bad debt but right now we don't 8 estimate bad debt. We have that flexibility.

9 That approximately 100 percent does not mean that 10 I shouldn't assess 100 percent of the budget. It also means 11 for example, if the total amount that we collected is 12 slightly more than 100 percent we don't have to go and try

()13 to make a refund. Obviously, we don't want to be in a l 14 position where we are collecting considerably more than 100 15 percent because obviously people don't like to pay. 1 l

16 The law gave us three sources of 100 percent.- The 17 first one is the nuclear waste fund. I have mentioned it, '

18 and I won't talk about it anymore. All of our activity ,

19 related to the high level waste repository comes from a fund 20 that the utility pays in that DOE manages. I think it's 21 like a trust fund, but they pay so much per kilowatt hour of j 22 electricity and they pay it to DOE. Congress appropriates 23 that money directly from that fund for all of our activities

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24 associated with the high level wante activity.

25 From this point on, the resource that I will be )

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1 talking about will exclude those because they do not come in

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2 as fees.

3 Then Congress tells us that we must collect the 4 remainder of our budget through two types of fees. One, we 5 must charge a fee for identifiable service to specific 6 applicants or licensees. That requirement also is a part of 7 the independent office appropriation Act which is another 8 one. We can only charge for service rendered. It basically 9 says the remainder of the funds that we appropriate to you 10 must be collected through an annual fee.

11 The license fee is the first type of fee for

-12 service rendered. We basically charge to issue -- if we r) 13 (s_/ review an application to make a decision on a license we 14 charge you on that. We charge you for an amendment. We 15 charge for review of any type of report or other approvals 16 we may issue, and we charge for inspection. The fees that I 17 think Gerry had on the chart there was an average of these 18 types of fees. This did not including the annual fee.

19 The 1133 item, if I recall right Jerry, it came 20 from the regulatory flexibility analysis we had done as part 21 of the rule. What we had assumed was on the average that 22 each licensee would get one anendment per year. I think for 23 the gage user they are on the inspection frequency of one 24 inspection every three years. Then, we had a renewal every 25 five years. That was an average cost. If you looked at a O)s

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Lo t 1- five year average that would be an average cost per year for i

2- 'say a gage user.

. I think that's what those fees were.

l 3 The fees themselves are gaged -- Jim, do you 4 remember what's in the new application for a gage-user --

i 5 something like $500.00 or_$600.00 if I-recall right.

! 6 The constraint that we have here is that we can 7 only' charge for a service rendered. Obviously, if you.get 8' an application that's a service. We went through a court

! 9 case earlier on in terms of inspection, whether that was a-f- 10 service to an applicant or licensee. The conclusion the 11 court said that it was a service. We can only charge for a j 12 service. We were doing research to write a rule for '

13 example, we can't say that's a benefit.

( That's a service to l' 14 -you because it has to be a specific applicant. It can't be I

!' 15 generic. That's the constraint we have here of what we can

!- i i 16 charge under this part of the regulation. The law requires 4

17 us to charge these fees first.

i 18 What we don't recover from providing identifiable f '19 service to a specific applicant or licensee we must recover i 20 through what we call an annual fee. What we recover there, i 21 what those activities include are what we call generic 1

22 activities. Research we might be doing, rules we may issue,

.23 event evaluations that we might do. NMSS for example I i

. 24 think put you all on -- whan they talk about events that 3

25- occurred in the states.

4

d 4

1 We have some costs that we don't have a license l 2 that we'can charge to. For example, when we start off on 3 the uranium enrichment -- we don't have any uranium '

! 4 enrichment licensees right now. As we go through that in 1 1

5 the first set of rules we must recover those costs also. If I l 6 the Commission makes a decision to exempt somebody from fees 7 we must also recover those from somebody else on a Part 171 8 annual fees. For example, the Commission made a policy 9 decision to exempt non-profit education institutions.

10 Since we have to assess fees for 100 percent of 11 our budget they must assess those fees to someone else. We 12 get a lot of letters obviously say that please exempt my

()13 group of licensees from these fees. If we do, then we have 14 to figure out whose fees to increase.

15 A couple of constraints we have on annual fees, 16 one_is that they must apply to the licensee. We are not 17 allowed to charge an applicant for example. It must be an 18 NRC licensee. One question we obviously get is, why don't 19 you charge NRC licensees. The other one is that they must 20 have to the maximum extent practicable, a reasonable 21 relationship to the cost of providing a regulatory service.

22 In this case they have defined regulatory service as must be 23 a relationship to a class of licensees.

24 We can't go and say we are going to base these 25 fees on how much money you make or we are going to base

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

~

[3 u> 28 1 these fees on other economic reasons, or we are going to l

2 base these fees on the economic situation in your region.

3 The fees must be based on the cost of NRC of regulating that  ;

l 4 group of licensees.

1 5 What are the components of what I call the 1

6 components of the cost that we must collect. When I use the 7 word direct program, direct in relation to the program and I l 8 use material, activities that the staff or contract we have 9 in direct support of that program. For example, in the

\

10 program office the functions that we have including l 4

11 research.

f 12 The first component is that we have contracts that

[dh 13 14 we have with the national labs or commercial firms to help us perform our regulatory programs. Second, we have direct 15 staff -- a government buzz word -- we call it fulltime 16 equivalent or FTE. I will use that term for the remainder 17 of the discussion. We have direct staff or direct FTE in 1

I 18 support of the program.

19 Then we have overhead in support of FTE's. For 20 example, the Office of State Programs is considered in that 21 area called overhead and support FTE office of Commission --

22 the Office of controller is in the overhead, FTE's 23 associated with that. We have those overhead and we have 24 overhead at the program office level.

25 The last component, what I call G&A contract

%)

1 costs. We pay a lot of money in rent for all of the 2 buildings. We have training. Not the time that people l 3 spend, but we have training. We buy supplies and equipment 4 of the PC's, we buy paper. We also pay for airline tickets, ,

1 l l 5 et cetera. These are all of the costs that we have to 6 collect. j l

7 The next question then is, how do we allocate '

8 these costs or how do we determine how to apportion these 9 costs to the different programs. The first thing we need to 10 do is, we basically say we keep track of the direct FTE's 11 and the direct contract costs that are expended against a 12 particular application or particular amendments or

()13 particular activities. Then, it becomes the direct contract 14 costs -- if I know the direct contract I contract out and we 15 require the contractor to tell us how much they spend. We I l

16 use a unique identifier, a number that says this particular 17 activity supports this particular docket and this particular  ;

18 licensee.

19 So, we know that and ask the contractor to report 20 those costs. Those are direct costs that we pass directly 21 to the licensee. Then, we have the direct FTE, and we then 22 multiply that by what we have called an FTE rate. That is, 23 a rate we are going to charge per FTE or a rate we are going 24 to charge per hour of effort we have spent. That rate is 25 all of the costs associated with the direct FTE, the O

- - -- - - - _ - . - - - -= -. -_ ..

1 overhead and the G&A. Then, we divided that by the number 2 of direct FTE's we have and it gives us a rate.

3 The hourly rate then becomes not the total number 4

4 of hours in the year because we assume that the training 5 hours5.787037e-5 days <br />0.00139 hours <br />8.267196e-6 weeks <br />1.9025e-6 months <br /> that one spends, the vacation hours that one spends, T

6 is the total hours in the year less those activities which l 7 is 1744.

8 MR. GODWIN FROM ALABAMA: I thought the G&A 9 included those training costs?

10 MR. FUNCHES: No, it includes the contract costs.

11 MR. GODWIN FROM ALABAMA: But not the actual time?

4 12 MR. FUNCHES: Not the actual time. Nor does it

()13 include the actual time for hours -- for leave for example.

, 14 That's 1,744, the total hours in a year is 20,080. The 15 difference between 2,080 and 1,744 are what we call non-l 16 direct hours, if you will, non-direct productive hours.

17 The 1992, the proposed rule would be for 1992 --

18 it's being published tomorrow. I think we normally mail 19 everybody in this room a copy. All agreement states will be 20 mailed a copy of that rule. If we talk about the salaries l

i 21 and benefits here, we have the salaries and benefits. That 22 includes both the overhead and the direct. It's about one-23 half and one-half, half of our FTE will be considered direct 4

24 and about one-half would be considered overhead in this 25 scheme.

O

O 1 G&A contract costs, about $94 million.

31 Salaries i

2- and benefits, again, about $238.3 million. Travel costs -- '

l 3 not the time in travel -- the payment of airline, is about 4 $13 million for the Agency. We also, we do get some 5 receipts in for when we do FYA's so that we don't collect 6 twice for anything we subtract out about $100,000.00. That 7 leaves us an amount that we must collect through the cost 8 per FTE of $346 million.

9 The remaining part of this year we need to collect 10 $492 million. The remaining of the direct contract costs' 11 is, again, passed directly. Then, you go through the 1 1

12 division and we have 1,600 direct FTE's and that comes out

()13 to be about $214,500.00 per FTE, or $123.00 per direct hour.

14 We.get a lot of comments that that's a very high rate.

15 Lawyers don't even charge $123.00 an hour.

16 The reason is, we were very careful because of the 17 constraint we have, in what we can charge in a Part 170 --

18 not to try to charge as a direct cost, things that could be 19 overhead. You could say we are going to have all of the 20 branch chiefs report their time against particular dockets.

21 We decided the opposite in saying okay, we have a budget 22 structure we call overhead and we will stay there. Most-23 commercial contracts will try to put it much as they can in 24 the direct -- in this number here, the divisor -- so that 25 rates looks lower. They try to charge as much directly as

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n 32 1 opposed to including it in overhead.

2 Those are our rates. That rate is'about seven 3 percent higher than last year. A combination of our budget 4 went up, inflation built in. That rate then is used for 5 everything else we do as it relates to fees.

6 We can talk about how we get from A to B. What we 7 do is, we have a lot of different types of licensees. If 8 you look across the top, this is what we call the major 9 class of NRC licensees. We have power reactor, non-power 10 reactors, research and test reactors. We have fuel 11 facilities. Those are the large fuel cycle facilities. We 12 have spent fuel storage installations, the independent 13 storage installations. The one that's being built at Fort

('u]D 14 St. Vrain and there's one being built over at Calvert Cliff 15 now. Then, we have what we call the small material license.

16 This class, the one I have bracketed here, that is 17 the class that includes most of the licenses that you 18 regulate. We have transportation casks. I assume you have 19 some transportation casks, packages I guess that go along 20 with some of the sources like radiography sources. We have 21 uranium recovery license in the mills and mines. We have 22 another category here that we call applicants, and that's a 23 catch all for what we have applicants but we don't have any 24 license.

25 Then, we have a category called surcharge. These 7

k l

(,/

i 33 1 'are where we either made an exemption or other decision that 2 we have to recover these costs from other license or policy 3 decision.

4 On the right you will see -- let me just explain 5 what these acronyms mr.an. If you look under the budget I 6 direct FTE resources, the first acronym is Reactor Safety 7 and Safeguards Regulation. That's basically reactor 8 programs. The next one is Nuclear Safety Research. The 9 next one is Low Level Waste and Materials Safety and 10 Safeguards. The next one is special independent reviews, 11 and the next one is basically some management support.

12 Really, it's on our international programs.

Using what we talked about there, we take those

( ) -13 14 direct contract dollars, direct FTE's and sum them up. If 15 you look at the total there you can see under the total it 16 says 1613, and we have $146 million worth of direct contract 17 that we must recover. We then convert that into a fee 18 amount, and that fee amount is the sum of the direct FTE's j 19 time the hourly rate plus the direct contract.

20 To go down to the bottom of the page you see two 21 types of money. The first one is the estimate of how much 22 we are going to collect under Part 170 fees. That is an 23 estimate based on historical data and changes we know of, 24 and when those changes will take effect. We estimate how 25 much we are going to collect there and the remaining is what

(mv) 34 1 we bill for an annual fee.

2 Under the Part 170 fees we use the hourly rate 3 basically to determine what those fees are. Again, for most 4 of the materials license we charge what we call a flat fee. j 5 That flat fee is based on a historical data on how many 6 hours6.944444e-5 days <br />0.00167 hours <br />9.920635e-6 weeks <br />2.283e-6 months <br /> it takes to perform a review of a gage. If it takes 7 us five hours to perform a review of the gage we multiply i 8 five times $123.00 an hour. That's how much the flat fee 9 is. That's an average.

10 Some of the fees that we charge under Part 170 are 11 not flat fees. We charge you based on hourly, like if you 12 go to the lawyer. We keep track in increments of time, heri/

( 13 many hours we spent. We do that for most of the large fuel 14 facilities, all of the reactors, non-power reactors.

15 MR. GODWIN FROM ALABAMA: Waste disposal?

16 MR. FUNCHES: Low Level Waste Disposal, yes. What 17 we do there is, we keep track of the -- we have a reporting 18 system where people fill out what we call Ritz sheets.

19 Those sheets are entered by a unique identifier. We keep 20 track of those hours. It usod to be that every six months 21 we would gather up all the information and bill for the past 22 six months. We just changed the rule and are going to do it 23 every three months. We are being pushed to be good 24 financial managers. It's good for the people being billed, 25 so they know how much money they are going to billed and s-

)

4

/~h 35

~

, N-1 whether they need to adjust contracts.

2 Again, what we do is collect the contract cost

, 3 that has been expended and number of hours that have been 4 expended, and we use the hourly rate again. Those are the l

5 two types of fees we basically charge for Part 170.

6 For the annual fees, for $32 million we need to 7 figure out how to allocate that between -- I guess we have 8 7,000 licensees now. By the way, we started last year with 9 9,000 licensees and are down to 7,000. Some of it was clean 10 up. Some of the people, I assume, thought that the fees of 11 this magnitude that it wouldn't be profitable. You see a 12 lot of things happening. Some people combine licenses and

[v ) 13 some people say I had this license but never used it, so if 14 I have to pay for it I don't want it.

15 We are down to 7,000. You take those 7,000 16 licenses and determine how to charge this annual fee to 17 them. We use different methods for the different classes 18 because the circumstances are different. What we 19 essentially do is, we go in and look at the different sub 20 classes if we have to determine whether there is a 21 distinction between the types of costs that are being 22 recovered under Part 171. For the material license we do 23 believe there is a distinction. What we have done is looked 24 at those costs and based the distribution on how much they 25 cost us to regulate them under Part 170.

O I

l I

() 1 For reactors, for example, we go in'andLlook at 38 2 the research. We know a' lot of.the research is by vendor, 3 Westinghouse, GE, and there is some seismic research for ]?

4 example that is more related to reactor located west of the {

L f l 5, Rockies. We go in and look at the specifics on the budget j e

l 6 and make an allocation, and then we come up with an annual  !

7 fee for each of these.

! 8 The result is that the total.that each licensee  !

L 9 pays is-a certain requirements under Part 170 -- they must L

10 get a license, they must renew a license. We will inspect .

11 them at a certain frequency. Amendments, if you request an 12 amendment it will pay for it. The annual fee they will' pay,

()13 whether they do anything -- request an amendment -- as long 14 as the hold a license they will pay an annual-fee. Those 15 are the two fees.that they pay.

)

16 The gage user fee in 1991 was $1,400.00 and it's j 17 $2,000.00 this year, annual fee. The total fee for example '

18 that they would be paying if you use that $1,100.00 there -

19 --

it would be $1,100.00 plus $2,000.00, roughly $2,000.00.

I 20 It more like $3,000.00.

21 I can take questions. Jim and Glenda would also i 22 be available to answer any question that you might have.

l 23 MR. SCHWARTZ: Maybe it's early in the morning for 24 this. Take us through the fee amount line below the waste l

l 25 materials, and you end up with -- the materials are where

=- - - -. - - . - _ - , . .-

i l( 37 l % )'

1 you have the double lines, $29.8 million. That is what we 2 have to collect?

l 3 MR. FUNCHES: The total amount you have to collect 4 from material license is $37.1 million.

5 MR. SCHWARTZ: I mean just for that one category. I i

6 MR. FUNCHES: That one category is NMSS. <

7 MR. SCHWARTZ: That's $29.8. l 8 MR. FUNCHES: That's $29.8 million.

9 MR. SCHWARTZ: That's arrived at by --

10 MR. FUNCHES: Go back and look at the same line --

11 MR. SCHWARTZ: That's two million, four hundred 12 and seventeen and 127 FTE multiplied out by the hourly rate 13 and hours by year.

(

14 MR. FUNCHES: By the FTE rate. That's by the FTE 15 rate, right. You multiply 214.5 times 178.8 and add that to 16 $2.4 million and should come up with $29 million.

17 MR. SCHWARTZ: That number there, $29.8 million is 18 divided by the 7,000 licensees.

19 MR. FUNCHES: Is allocated to the 7,000 licensees 20 by -- the radiographer ends up paying so much --

21 MR. SCHWARTZ: There's a judgment made on all of

22 those, how much each --

23 MR. FUNCHES: Right. It's explicitly stated in 24 the rule action, yes.

I 25 MR. SCHWARTZ: Thank you, Jessie.

.s ks L

I

i 1 MR. BAILEY.FROM' CALIFORNIA: Having worked in two ,

2 ' states that charged everybody regardless of who they.were'a  ;

i

, 3 license fee, what is the rationale for excluding people from

-4 paying.the fee and how much money do you lose because of L 5- that?

6 MR. FUNCHES: We don't lose any money by doing 7 that. We charge somebody else for that.

8 [ Laughter.)

9 'MR. FUNCHES: The Commission, in their 10 deliberations, excluded only one -- made a decision to 11 exempt only one group of licenses from fees. That decision 5 12 on exemption is with the non-profit education institutions,

()'13 colleges and universities. The Commission made that 14' decision. They believe that they were providing a general 15 good to the world, and'that the licensee -- it was okay to J 16 charge the licensee for them.

17 MR. BAILEY FROM CALIFORNIA: I find that l

18 interesting, because some of the major licenses that you 1

19 have in the materials area are in fact educational 20 institutions.

21 MR. FUNCHES: Let me clarify that. The Commission l l

'22 also said that if the license was being used for a profit or 23 human use they are charged a fee. For example, if it's a 24 human use which basically means they could receive a profit l 25 for the license, the license -- gem stones. I think that's  ;

l

/~N.

39 1 the University of Missouri has that to distribute those gem 2 stones, that is being charged a fee. The license that the 3 University of Missouri holds for the reactor to teach is not 4 charged a fee. It's exempt.

5 If you are using it for human use or for profit 6 purposes then it is charged a fee. I apologize for that.

7 The other substantial part of costs that we would not 8 collect in there is, we have this -- the law has some 9 constraints and has some prohibition that says you can only 10 charge an annual fee to licensees. It also says if I don't 11 have any licensees -- for example, I don't have any low 12 level waste licensees. I can't charge them an annual fee A

i for all this regulatory work I am doing. I am developing U) 13 1

14 reg guides and branch technical positions and modifying the 15 regulation and all that generic work in performing research.

16 The law also says you can't charge them under Part 17 170 because it is not an identifiable service to a specific I

18 applicant. This regulation is not a service or a benefit to 19 a specific applicant. I have this pile of costs for low 20 level waste, all this generic cost, that I can't charge to a 21 licensee. I can't charge to a low level waste licensee.

22 Again, I have to collect 100 percent. What we basically did 23 was, we said we were going to charge everybody who generated 24 low level waste.

25 When you submit an application for a site you will f~h N- ,

1

/-

(m) 40 V

1 be charged an application review fee, or you will be charged 2 pre-application review when you indicate an intent to submit i 3 an application.

4 MR. FRAZEE FROM WASHINGTON: When you are 5 apportioning the fee to the various categories in materials )

6 licensees, can you tell me again what the basis for that is?

7 MR. FUNCHES: The way we apportion it for the 8 material license, we said that the difficulty in performing 9 a review of the application and the inspection and frequency 10 is a proxy for the complexity of the regulation and of the 11 generic activity that we perform. We use that as a proxy 12 for allocating between the various licensees. We don't keep g

track of generic regulatory activities by class of licensee,

( } 13 14 we don't track that information or budget it that way 15 either.

16 We had two choices. The first choice was to 17 uniformly allocate it to 7,000 licensees -- or 9,000. The 18 bottom line here, 31.1 and divide it by 7,000. That was one 19 alternative. However, we precluded that we know that some 20 of the sub classes of material licensees' regulations are 21 more complex and therefore requires more time to develop, 22 monitor and update than other licensees.

23 MR. FRAZEE FROM WASHINGTON: Take it back one more 24 step. The inspections and the licensing fees, are those a

25 adjusted according to your current experience in those

(\

2 l

I 41 1 areas?

2 MR. FUNCHES: Yes.

3 MR. FRAZEE FROM WASHINGTON: That's a time sheet i

4- or some other type of -- j 1

5 MR. FUNCHES

We keep track of those costs. They l 6 report how much an amendment and keep track. Currently, we 7 used to periodically go back and review them and update 8 them. The new chief financial office requires us to look at 9 them every two years now, update them every two years. We 10 go back and say this is how much we hr.ve been spending, this

]

11 is the new average cost per amendment for radiographer, new l 12 average cost per inspection of a well logger, and multiply

[)13 v

that by whatever dollar the rate.

14 We will update the fee every year if the hourly 15 rate goes up. We just upgrade it by that percentage. We 16 look at the hours. We are supposed to look at them every 17 two years -- we are required to look at them every two years 18 now. In the past I guess it varies from I guess three to 19 five years.

20 MR. NASH FROM FLORIDA: You use weighting factors 21 that you apply as a difficulty. Is this just cased upon 22 hours?

23 MR. FUNCHES: It is based upon -- yes, it would be 24 based on an hourly fee.

25 MR. NASH FROM FLORIDA: The hours which you are O

[\_/

• )

42 1 using in an inspection and the hours you would use in an 2 evaluation of a license.

3 MR. FUNCHES: Right. We use two things. We use 4 the hours that are being used in a new license, hours used .

5 in the inspection and frequency of the inspection. We use 6 those three components to make the distribution between t

7 them.

4 8 MR. PARIS FROM OREGON: Are the times available 9 for distribution that you use? For instance, the number of 10 hours1.157407e-4 days <br />0.00278 hours <br />1.653439e-5 weeks <br />3.805e-6 months <br /> that you take for inspection of radiographer?

11 MR. FUNCHES: The fees are based on what you do 12 with those hours. We convert them into fees. You can go

()13 back and divide by hourly rates. The numbers are obviously 14 rounded so you can be off plus or minus one hour. '

15 MR. PARIS FROM OREGON: For each type of licensee, 16 is what I meant.

17 MR. FUNCHES: Right. The only difference between i 18 if you went in and looked at an inspection fee, the fixed 19 inspection fee for any of the material licensee if it's a 20 flat fee, if you divide that by the hourly rate you will 21 come up with the number of hours. Again, recognize that we 22 round them off.

23 MR. O'DOWD FROM NEW HAMPSHIRE: I have a feeling 24 that this is going to be a rhetorical question. On the 25 program staff level does this sort of create any pressures O

7~

? f 43 L/

1 on the program staff to maybe rush through licensing actions j 2 or to rush through inspections in order to keep their costs 3 down?

4 MR. FUNCHES: There is that temptation. What we 1

5 have done is, basically we tried to -- the guidance that we )

6 have given to people as you do your regulatory safety job 7 and don't worry about the fees. We try to say have all fees l

8 questions diverted to Glenda. We don't want the staff 9 dealing with these. When you are talking about annucl fees l l

10 of $3 million you are charging to a power reactor a year, 11 it's hard to separate them. You are absolutely correct.

12 It's hard not to be concerned about them.

( 13 What we say is, you record your hours and don't 14 interact with the licensees on whether these are the right 15 costs. We try to take care of that. We get a lot of 16 pressure on the budget, not so much on people not to perform 17 this review. We will get pressure on the budget from people 18 saying NRC you are over regulating the medical community; 19 therefore, now I have to pay for your over regulation. They 20 put pressure to say we don't need this safety regulation or 21 don't need this regulation but not so much to say please 22 complete this review, please complete that inspection.

23 You will get complaints from people saying this 24 inspector was out here five hours and are charging me this 25 horrendous fee and he's found nothing wrong or she's found

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( )

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1 4

44

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~

1 nothing wrong. Why are you charging me this. The inspector 2 had to prepare to come out there, the inspector had to take f

3 time to travel out there, the inspector was on site, travel 4 back, and write up a report. l i

5 Usually you get through that. Yes, when people l 6 say I am paying for your budget and they tend to want to 7 make comments about what you need to do. No pressure to say 8 cut the review short. A lot of pressure is put on, but once 9 we get the money there's no pressure then.

10 MR. GODWIN FROM ALABAMA: Since we charge 75 11 percent of yours we probably hear some of the same comments 12 you get, one of which is the medical community that uses the

(~%

(}13 lixiscopes feels that those fees are way out of line for the 14 types of services they are rendering. Could you comment on 15 that a little bit? I know you have grouped them all 16 together but it sort of gives an idea --

17 MR. FUNCHES: I am going to let Glenda give that. j i

18 That's not a separate license, is it? l i l 19 MS. JACKSON: No. At NRC's licensing many doctors 20 have a separate license for the lixiscope, but there's also 21 the possibility that a lixiscope could be on a medical 22 license with other nuclear medicine items. We did look at 23 charging separately for the lixiscopes a few years ago and

24 decided that the medical licensees in those cases where they 4

25 had a lixiscope on a broader scope medical license would

-)

G

l l

1 then be charged two fees because of the separate category 2 for.the lixiscope, so we decided against that in our fee 3 schedule.

4 There have been a lot of comments from doctors 5 like that.

6 MR. GODWIN FROM ALABAMA: When you make a one hour 7 inspection and hit him for about $900.00, he tends to think 8 that you are making more money than he'is.

9 MS. JACKSON: Right.

10 MR. FUNCHES: The choice we had, I think -- and 11 you are always going to have this. If you have 9,000 12 different licenses we are never going to come up with

[')13

%J something that isn't going to be perceived as for everybody.

14 I think what Glenda was saying was, the choice we had was 15 treat a separate fee category for lixiscope.

16 The person now who has a medical license and a 17 lixiscope license is then going to get with two fees and 18 they are going to say that's unfair to me. I think that's 19 what you are saying. We have a lot of letters about the 20 lixiscope. I haven't seen any for the last six months but I 21 guess they will start again when we bill again.

22 MS. JACKSON: We also were very careful about not 23 setting a precedent to establish a separate fee category for 24 each different type of device or a particular product, for 25 example, just establish a separate fee for Texas Nuclear O

U

46 1 Gage or that type of thing. Doing that for the lixiscope 2 would have been the first time we would have established a 3 separate fee category for a particular one.

4 MR. PARKER: You touched on something that I also 5 touched on in my opening remarks. The number of licensees 6 has dropped from 9,000 to 7,000. I don't knot if you have 7 done any five year projections of how many licensees you 8 think you will have. We now control two-thirds and you have 9 one-third. Let's say that we now control 90 percent and you 10 are down to ten percent.

11 Hopefully, and I think that's some of the wishes 12 of some of your Commissioners Shelly, that all the states

()13 will become agreement states. Your overall costs are 14 already in there, that you can't do anything about. It's 15 true that you can reduce some of the FTE for the processing 16 stuff. Your cost will continue to rise and your hourly rate, 17 I think, would go up.

18 One of the concerns with the states, and I think I 19 mentioned it, are licensees moving from one state to another 20 to take advantage of a lower fee. One state told me while 21 we were preparing for this workshop that the Governor was 22 informed that unless the state became an agreement state 23 this industry would not locate there because they were 24 concerned about rising cost for licensing.

25 Would you care to comment on what's going to O

O 1 happen if a number of your licensees goes down much more, 47 2 down even to 5,000?

3 MR. FUNCHES: It's two things. Let's talk about 4 the components of the cost. The components of the cost that 5 we have to regulate and one is we have the Part 170 costs.

6 Obviously, if you don't have any license to regulate and the 7 licensee goes down in number of amendments and number of new 8 applications and number of renewals go down -- that cost 9 will go down.

10 The other part of the cost is what I call generic 11 type costs which are recovered under Part 171. If we got 12 5,000 licensees and as long as we have to regulate medical licensees and as long as we have to regulate radiographers,

}13 14 unless a whole class go away we still have to maintain a set 15 of regulations. Obviously, if you only have one you 16 wouldn't have a set of regulations. If you had 5,000 or a 17 reasonable number economics say you ought to do it 18 generically.

19 Yes, we would still have what I call a generic 20 costs or the costs of having a generic program. These costs 21 would still be incurred. Obviously what will happen will be 22 that if the number of licensees you have to charge these 23 fixed costs to go down then the annual fee goes up and not 24 necessarily the other fee. The annual fee would definitely 25 go up. The other fee would go up probably not as much. It

L 48 1 wouldn't be insignificant because the bulk of the cost is 2

based on the direct staff as associated with reactors.

3 If you look at associated with material license we 4 are talking about 143 direct staff out of 1,600. The hourly 5 rate wouldn't go up. The amount that must be recovered 6 through the annual fee wouldn't drop as fast as the number 7 of licensees, therefore, the annual fee would go up. What l

8 the Commission would do at that point, I don't know. There 9 are all types of options. They could go back to Congress and

)

10 say we can look'for other people to pass some of these costs i 11 on to or whatever. I don't know what they would do, and I 12 would hate to speculate.

('

G T 13 MR. KAMMERER: Jessie, I will give you Harold 14 Denton's answer to that one, and that is that there will be 15 one non-agreement state -- let's call it Ohio --

16 [ Laughter.]

17 MR. KAMMERER: Charge them $37 million, but annual 18 fee.

19 MR. FUNCHES: I would think that at some point the 20 Commission would probably say -- they would have to revisit 21 the issue then. What they will do and what Congress would 22 do would be just pure speculation.

23 MR. BAILEY FROM CALIFORNIA: In reality, you are 24 always going to have the Federal government to charge, the 25 Army, the Navy, the Air Force and the VA and EPA. So, we b

a

)

l 49 a

[/D x_

1 are going to have to -- we only have six reactors under 1 l 2 construction, and it doesn't look like you are going to get

3 a whole heck of a lot more applications this decade than you j 4 did last decade. That program is going to go down the tubes i 5 too.

i 6 MR. NASH FROM FLORIDA: You are already facing it I

7 to a certain extent. The average for the license fee here 8 is $4,800.00 a license. Obviously, if.you have a-few i 9 biggies in there somewhere to average that down -- J 10 MR. FUNCHES

The distribution, you have some  !

4 4 11 pharmaceutical manufacturers in this $32 million. The range 12 I believe goes from lowest fee annual fee now is $600.00

( 13 and the top one is $16,000.00.

14 MR. GODWIN FROM ALABAMA: Speaking of annual fees, l

15 the first year you instituted you allowed everybody to 16 terminate free of charge and didn't charge them an annual

)

4 17 fee. That works out real good the first year. Suppose 18 someone had a license for let's say ten days into 1992 19 fiscal year and terminated; are you going to charge him an l

20 annual fee for 1992? Choose a time, and how are you going 4

21 to determine that?

1

- 22 MR. FUNCHES: In terms of efficiency in i 23 implementation, we made a decision that we -- for material 24 we are going to pick a cutoff date. The rule that's in 25 effect right now has picked October 1 as that cutoff date.

i i

4

(D

%-)

50 1 .The proposed rule that will be published tomorrow -- and for 2 good reason -- people were not able to react as fast as we 3 felt they could when we put out the first rule. There was 4 some confusion. Obviously, it's the first time people have

5 been in charge of annual fees.

a 6 A lot of people weren't charged fees. States had 7 never been charged before, so there were a lot of first time 8 fees. We have moved that cutoff date to December 31, 1991.

9 The intent of last year of giving that window of opportunity i

l 10 to terminate between the publication of the final rule and i

11 the effective date of the rule was because people did not 12 know whether the annual fee would be sustained for materials f\/) 13 license. Wo said okay, you don't have to cancel now. We 14 will give you a window of opportunity once you know all the

15 facts. l i

16 I think it is clear right now that people know 17 there will be an annual fee. The intent right now is not to 18 provide that window of opportunity. If you have a license 19 on January 1, 1992 you will be charged annual fee for the I 20 entire year. 1 21 MR. GODWIN FROM ALABAMA: Even if you terminate 22 you are all going to track those and make sure you go back 23 and bill them.

24 MR. FUNCHES: Yes. They will be billed.

25 MR. GODWIN FROM ALABAMA: If they terminate like O

V J

]

1- the 15th of January, you are going to bill that guy. 1 2 MR. FUNCHES: We froze the date a's of that point.

l 3 We. originally froze it as of October 1 and now we are 4 freezing it as of January.

5 MR. GODWIN FROM ALABAMA: Anybody who applies who I 6 has a license will also be -- I 7 MR. FUNCHES: We do not charge -- we pick a cutoff l 8 date and say if you have a license get a license. After 9 that date we don't charge.

10 MR. GODWIN FROM ALABAMA: What date was that?

i 11 MR. FUNCHES: That was October 1. We did not l 12 change that one. If you applied after october l'we don't I 13 charge you.

(

14 .MR. GODWIN FROM ALABAMA: For the 19927 l

15 MR. FUNCHES: The reason for'it is because what i 16 you get into, you get into -- if I do you start making 17 additional assumptions about how many people you are going 18 to license during the year and when you are going to license 19 them. We had two choices basically. Either we charge a 20 prorated fee based on when you get the license and when you 21 terminate -- and that's a nightmare. Say you terminate the 22 six months and you -- if you got a license six months into

~23 the year you pay half the fee.

24 You get into administrative nightmares because you +

25 have people going out, adjusted fee, and we were trying to i t

4

/~Tl 52

\v 1 bill only once a' year just to minimize the administrative 2 burden of doing it. It is not very easy to bill 7,000 4

j 3 licensees and follow up and answer their calls and collect

4 and follow up. l 5 MR. FRAZEE FROM WASHINGTON

You do it once a 6 year. You are batching all the bills and have 7,000 of 4

7 them. You have a considerable amount of staff time devoted l

8 to that. What are these staff doing the remainder of the j 9 year?

10 MR. FUNCHES: We bill throughout the year. We are 11 billing reactors every three months and for each amendment I

1 12 that they request. It's not like they get one amendment.

We are

()13 They might have ten or 15 amendments under review.

14 billing reactors, we are billing fuel cycle facilities, we

15 are processing bills for application fees, all the Part 170.

16 Any bill that is over $100,000.00 -- annual fee

, 17 bill of $100,000.00 is billed in quarterly increments. All l

18 of the large bills are billed in quarterly increments, l

19 anything over $100,000.00.

I 20 MR. FRAZEE FROM WASHINGTON: Which all should 21 actually average out over the year, j 22 MR. FUNCHES: Right.

- 23 MR. FRAZEE FROM WASHINGTON

So, that's a 24 constant. Here is this big --

j 25 MR. FUNCHES: What we basically do is handle the i

f rN

(_

1 peak, and the peak is not at just at one time. What the j 2 peak normally is probably goes over three months. 'l Then we '

3 have what we call debt collection activity, people who don't 4 pay. Right now we bill -- let me just give you an 5 indication of what happened. i 6- Wa billed last July --

7 MS. JACKSON: We actually sent the bills out in 8 . July.

9 MR. FUNCHES: Right. That was a month, and some l l

10 people would pay. Then, we would have to send them a second 11 notice and a third notice. Then, during that first three 12 months there's a lot of phone calls. We actually -- we l

()13 underestimated. We actually had to shut down operations 14 just to answer the phones. We were getting like 300 or 400  !

15 phone calls a day. We don't expect that this year, but it's 16 going to be high. l 17 After that you have to follow up. You have 1,000 18 licensees follow up, process orders to terminate. You have 19 a lot of Congressional orders. You have a lot of activity J 20 going on after the billing. If everything went perfect, you  ;

21 billed and everybody paid, the amount that it takes to do 22 that is not very high. The amount that it takes to send the 23 bill out is not very high. It's the follow up to the bill 24 that requires all the effort.

25 MR. NASH FROM FLORIDA: Why did you decide on a O

i v} 1 one time annual billing instead of say anniversary date?

54 l

1 2 MR. FUNCHES: Instead of picking the anniversary 3 date of the license, is that what you are saying? We picked a

4 the one time bill last year and stayed with the one time 5 bill because we had a law that told us you have to collect

6 by the end of the fiscal year. The law was passed in 7 November, so it was passed one month into the fiscal year.

8 By the time we were able to bill it was July. You 9 could base it on anniversary date and can eliminate the type 10 of problem you were talking about if there is a big peak.

11 MR. NASH FROM FLORIDA: Would you expect to change 12 that?

( 13 MR. FUNCHES: I hadn't thought about it.

14 MS. JACKSON: In 1992 we also had to do a 15 rulemaking. By the time that is finalized we expect to be 16 billing again in July and have to make those collections by 17 September.

18 MR. FUNCHES: I don't know in the future whether 19 we would change or not. We haven't thought about it, to be 20 honest with you.

21 MR. SCHWARTZ: Jessie, you have been with the 1

22 Agency for a while and you have seen the Agency collect fees 23 from ten or 15 percent and costs up to 45 to now 100 24 percent. For states getting started down that path, can you 25 give five or six lessons learned; things that you should do,

t 55 1 shouldn't do, can do, could do, things you have tried, 2 things that didn't work.

3 Those kind of things, I think would be important 4 to this.

5 MR. FUNCHES: From my perspective -- Jim and 6 Glenda please comment because they have been collecting a 7 lot longer than I have. I was on the other end feeding them 8 information. One thing I would say is try to keep it as 9 simple as you can. I think we have some complexities 10 because of.the way that the laws are written that I would 11 prefer not to have, that makes things a little more 12 complicated.

13

( I would say probably try to keep it simple. 'One 14- of the things business seems to focus on, and I think.it 15 would be a natural reaction to a fee is, I bought this 16 device and it ought to be based on how much money I make'and 17 not how much you take to regulate it and issue me this 18 license. It ought to be based on how much money I make.

19 That, I think, is a natural reaction from their concern with 20 economics.

21 So, whatever you do, you are going to get that 22 question. I am not sure there's anything to do to avoid 23 that. I would say keep it simple. I would say, if you 24 could, have one fee. Don't have the two types of fees. Try 25 to accommodate those into one bill. If you require to O

_ _ __ _ _ _ _ _ _ _ _ _ .-__ ._- _ > m_ - - _ _ - - _-

i

,/~T 56~

!U 1 charge an annual fee charge the annual fee, and to the 2 extent you can make it reasonably fair and equitable bill 3 all of your components into that one fee.

l 4 If you are going to charge just a licensing. fee, l-5 bill all the components into that fee. It gets very

$ 6 complicated the more estimates you have to make and the more 1.

7 different types of fees that you have to manage.

l i 8 MR. PARKER: Jessie, we would like to thank you,

! 9 Jim and Glenda. We hope you are going to be around and hope i 10 the three of you will be able to stay the rest of the 11 workshop. Perhaps we can have some interchange as we raise i 12 the various questions that are here.

()13 Jessie, the last one you do not have on a slide 14 but all the rest are slides.

15 MR. FUNCHES: You can have a copy of the whole 4

16 package here.

I 17 MR. PARKER: Thank you very much. I am going to 18 turn the program over to Harry.

19 MR. BORCHERT FROM NEBRASKA: Thank you, Jessie.

20 Going back to the format, we will take the questions as they 21 are listed on the agenda. The first question is, how does 22 your state calculate program costs for budgeting and how are 23 fees, if any, determined. I will go ahead and start it off.

24 In Nebraska we have had a relatively long history 25 of what the program costs were. We accomplished it by O

4

/]

NJ 57 1 activity report format, and everybody was required to fill 2 out an activity report with program codes and activity 3 codes. When we got our fee statute passed in 1987, I took 4 that history and looked at that to find out what we needed 5 in order to have a program and determined fees based upon 6 the historical data.

7 Well, I took part of Texas fees and took our own 8 fees and came up with something that was an annualized fee l 9 and did exactly what Jessie suggested, keep it simple and 10 integrated everything into it, the application fee, license

11 fee, amendment fee, inspection fee and all that sort of l 12 thing. I even put in the overhead and the whole ball of wax.

}13 14 What we do with the budget from that is, every 15 year when we develop our budget I know precisely how much. j i

16 time is spent in each of the individual program areas within 17 the radiation control program. I take that number and 18 multiply it times my overall budget that I am provided for 1

19 on an annual basis and come up with the individual cost per 20 program area, so I know precisely how much money I have at 4

21 the start of the fiscal year for the radioactive materials 22 program, x-ray program, radon program, low level waste, 23 emergency response, environmental surveillance, the whole 24 nine yards.

! 25 We still maintain the activity format, the

%)

58 C,h )

} 1 activity codes and so on. Every two or three months we go 2 back and adjust the budget based on the activity report a

3 format so we can continually balance and match our budget 4 with our workload. At the end of the year, this last year

! 5 was a rather tight budget year and we have been doing it on i

6 a acnth to month basis and adjusting our budget 7 periodically, I have the flexibility of adjusting funds j l 8 within the program. If I am short in one area and have a 9 surplus in another area, I can do a paper transfer from one j 10 program area to another without getting into any problems.

. 11 With that, we will go ahead and start off around i

{ 12 the table here.

4 [ 13 MS. ROBINSON FROM RHODE ISLAND: First, I would 14 like to say that we are one of the states who collect fees l 15 but don't have a dedicated fund or restricted receipt 16 account to keep those funds to run our program. Our budget

! 17 for the calculation of our budget, it's based on the number 18 of FTE's or fulltime equivalents for responsibilities of 19 that program.

20 Some overhead is built into that calculation, not 21 all overhead. As Gerry Parker was pointing out, the travel 22 time, the calibration and maintenance, a lot of those things 23 aren't included now as part of the program costs that should

, 24 be.

25 Our fees are determined and were determined, they

p 59

'w) 1 are based on-NRC fees, neighboring state fees. Once again, 2 those fees are not supportive of our program, so it's not  ;

3 based on actual program costs at this point in the State of 4 Rhode Island.

5 MR. BORCHERT FROM NEBRASKA: Ray.

6 MR. PARIS FROM OREGON: Our fees have been 7 somewhat through an evolutionary process. We started back l

8 in 1969 with fees that were very low, and it's very  !

9 difficult to reduce fees in a state system. We have gone 1

10 through the incremental approach. This last session we did 11 get somewhat of a fee base, based upon actual costs of 12 programs. It is still not 100 percent recovery.

13 We are totally, 100 percent, fee based program but 14 a lot of our x-ray fee is supporting material programs. It 15 seems to be the fat cow. We have $100.00 per x-ray machine 16 that fees not only x-ray it fees environmental surveillance, 17 it feeds emergency preparedness. It's a very mixed bag.

18 We do hope to be able to use some of this data 19 gathered here to come up with a calculation on 100 percent 20 materials program. It's hard to do. We will have the same l 21 process that Jessie was talking about, the reduction of 22 licensees. You have about 22 percent reduction. We have 23 300 licensees -- right at 300 -- and I don't know if we 24 could absorb that much of a loss.

25 If we were to get close to the Commission fees we

(~1 I

l

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

4 1

1 1.

i 1 1 i O

- \_) -

60 j l' would be -- I don't think our government'would ever go for I

?

2 it. .It's too much of an impact on small business. We have t

{ 3 to fill out a fiscal impact-statement on small business.

4 When you start hitting those kind of fees it just isn't e l 1 .

. 5 going to happen. So, it's a rough row to hoe. l i'

6 MR. FUNCHES: Can I make a comment. We do make a 4

} 7 provision for small business. We are required by another i i \

j 8. law that is to consider the impact on small business. Our i 9 fees set two levels for small business. We have gross i

l 10 receipts of less than $3.5 million and less than 50,000 1

11 people. Between $250,000.00 and $3.5 million you pay i 12 $1,800.00 maximum. If you are less than $250,000.00 gross

! [N_/ D 13 receipt you pay $400.00 maximum.

t

14. We do have a small business --

15 MR. PARIS FROM OREGON: We have other people i

l 16 collecting our money. There is costs in other programs.

j 17 Personnel time in the fiscal services section, our mail room i 18 takes care a lot of the mailing issues. There's a lot of 19 other entities impacted by a fee program other than just in  !

20 our own section. Those costs are not figured into'this.

21 If it is figured into it, how are we going to j i i I '22 reimburse those other entities for those costs. It's just a i i

l 23 not easy row to hoe. I will answer more questions pretty i

24 soon.

J.

k 25 MR. BORCHERT FROM NEBRASKA: Do you have a flat

!C) 1 j

i

._ ...._._m __. ._ . . . - . _ _ _ _ . _ _ _ . _ _ . . _ _ _ _ _ . . _ _ . _ . _ _ -- . ._ . ._

l l

l '

t 61 1 . rate for overhead built in your fee?

2 MR. PARIS FROM OREGON: We have one fee.  !

j 3 'MR. BORCHERT FROM NEBRASKA: One fee.  !

4 MR. PARIS FROM OREGON: It covers inspection time, l

5 the whole. thing. .

6 MR. BORCHERT FROM NEBRASKA: Bruce. l 7 MR. HOKEL FROM IOWA: Bruce Hokel from the broke I 8 state of Iowa. 'I am speaking from my own perspective on 9 this, never being directly involved in the-budgeting.

10 process. I think what they do is figure the number of FTE's 11 that NRC requires in the progran and subtract one.

12 [ Laughter.]

13

( MR. HOKEL FROM IOWA: The fees are the same as 14 NRC's 10 CFR 170. But like in Oregon, we don't collect 15 them. They go to the budgeting office, the financial place 16 upstairs, and we don't actually see the license amendment 17 request or anything until they have processed it and it gets 18 down to us which is a weakness, I think, in our system.

19 We don't collect an annual fee like NRC, like I 20 think maybe we should consider. But at this point we are 21 not. Seriously, the fees for budgeting are based on the 22 number of personnel that we figure it needs to run the 23' program. At this point it's never been adequate. At this 24 point I think it's because all of our fees go to the general 25 fund and they just divvy out whatever they think it will Ov

. - . . _ _ - = .. ~ - - - . . _ . . - . ~ - . _ - -

1 need, and it's not adequate to support it.

2 MR. PARIS FROM OREGON: We do have dedicated 3 funds.

4 MR. HOKEL FROM IOWA: We don't. It goes to the 5 general fund and we say we need three FTE's or two FTE's and  :

6 they say we are going to give you one and one-half. We have 7 a problem.

4 8 MS. LIPOTI FROM NEW JERSEY: Do you collect more

• 9 in fees than you get appropriation?

! 10- MR. HOKEL FROM IOWA: We collect more in fees l

11 currently than it costs to run the program,.than the number 12 of FTE's we have devoted to it, to my knowledge. We have

[%)) 13 like one and one-half fulltime professionals working on the 14 program, and no secretarial support.

15 MR. GODWIN FROM ALABAMA: Has anybody explained 16 that to the licensees? i 17- MR. HOKEL FROM IOWA: That's what I want to talk 18 to -- I have been literally run out of town before by -- I 19 had a real good relationship when I was out doing i 20 inspections. I did a portable gage inspection, and I drug 21 the inspection out and went to ten hours and did a thorough 22 job. The guy said I will take you outside -- it was in 23 Dubuque, Iowa and they have a lot of neat buildings there --

24 I will take you outside and show you all this 25 architecture.

O O

1 We did that and around the blocks and everything.

2 He said by the way, is there a fee for this. I said we will '

3 send you the bill and stuff. He said, how much is it? I 4 told him and that changed our relationship right there. ,

5 I would like for'the benefit of the inspectors to 6 go out and do that. I have always wanted this myself, for j 7 portable gages -- kind of along the same lines as Aubrey was 8 talking on lixiscopes. It seemt

o me like a portable' gage l

9 fees are a little bit out of line for the amount of time it 10 takes to do an inspection. I realize there are other l

11 factors involved.

. 12 Could we get a third-grade level explanation on 2

()13 how those are calculated, so that we can show licensees and 14 say here's how this is figured out, especially for states 15 who use NRC fees. '

16 MR. BORCHERT FROM NEBRASKA: I think you will 17 alleviate some of that problem by going to an annual fee and 18 you tie it into the license process.

19 MR. PARKER: Jill.

20 MS. LIPOTI FROM NEW JERSEY: One of the things )

1 21 that is figured in our fees for sealed sources, gages and so I 22 forth is the fact that they get lost more often than other 23 things. We do have to deal with those emergency responses.

24 That takes an awful lot of time. Inspection at the facility 25 doesn't take much time. Analyzers that get lost in Newark, j

1 r  !

64 (h) l 1 I can't tell you how many. They get stolen right out of 2 health inspector's cars and we have to go and find them in  ;

3 some housing project where they have been sold for drugs.

l 4 This is not a pleasant emergency response, as you j 5 can imagine. So, that adds up and makes our costs for those 6 particular sources higher.

7 MR. BORCHERT FROM NEBRASKA: You've added the l I

8 emergency cost response into your license fees?

9 MS. LIPOTI FROM NEW JERSEY: Yes, at least for 10 those we did.

11 MR. BORCHERT FROM NEBRASKA: What we did is, we l 12 set it out as a separate category by rule and regulation,

(~

that if there is an emergency we can assess per emergency (h) 13 14 and at so much per hour and so much per emergency, and so on 15 and so forth. It doesn't make any difference what kind of 16 emergency it is.

17 MR. O'DOWD FROM NEW HAMPSHIRE: My supervisor, 18 Diane, was nice enough to prepare a text here for the l

19 response to this item. I better read it. The fees are 20 governed by the rules. Any changes in fees requires a rule 21 change and in some cases might even require a statute 22 change. Fees in general have been determined after review 23 of NRC fees and other state fees.

24 New Hampshire fees are charged annually, and NRC 25 and others may charge on a different basis. So, in review,

,m

/

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

() 1 we have reduced NRC fees for example to an annual base fee 2 for comparison. For example, a five year license fee is 3 divided by five and estimate of the number of-inspections is l

4 based on the category of licensee and divided'by whatever, 5- to get an annual charge.

6 A reasonable increase is determined based on total 7 dollars we wish to receive and a apportioned increase in the l 8 .x-ray fees. You have to remember that our budget for the 9 materials section is the same as the x-ray section and even 10 part of the emergency response. Our fees, of course, go to 11 the general fund anyway. We are completely generally 12 funded.

13 In fact, Diane notes here that a

( majority of the 14 dollars collected in fees comes from the x-ray, about two- l l

'15 thirds of the total. This'is because New Hampshire does not l l

16 have very many licensees, and those we do have are "small 17 licensees" like gage licensees and do command a large fee.

18 Increase of fees is a very political matter because of the 19 timing and relation to the budget process, and the fear that 20 the entire Bureau of Radiological Health -- all other than 21 the Seabrook related activities -- could be suggested by  !

i 22 some legislator as the answer to the state budget woes which L

23 we are always faced with.

l 24 I think what Diane is trying to say here is what 25 the legislators would like to do of course is to raise all l l

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

i

( 66 l

1 of our fees in order to increase general funds, monies t

2 coming in, not necessarily including us in that process.

3 Just raise the fees and get more money for the state. I i

4 guess that's her big fear.

5 Just to give you an example of the types of costs 6 that we have and fees that we charge for portable nuclear 7 gage, for instance, it's a'$45.00 a year annual fee. It's 8 extremely low.

9 MR. GODWIN FROM ALABAMA: Does your State have a 10 constitutional bar on earmarking your funds or dedicating 11 your funding, or does it have just a general pelicy against 12 it?

()13 MR. O'DOWD FROM NEW HAMPSHIRE: I really don't 14 know.

15 MR. PARKER: Now that you brought up industrial 16 gage, since I use that and Jessie used it, could you tell us 17 what the $45.00 is based on? Is that un hour visit or a ten 18 minute visit, or a one minute visit?

19 MR. O'DOWD FROM NEW HAMPSHIRE: I suspect that 20 part of the reason is that it was based on a 1982 assessment 21 of whatever the fees were at the time divided by five and 22 whatever, and just was never increased. In fact, it may 23 even be earlier than the 1982.

24 MR. PARKER: I think this goes back to what Jessie 25 said. I think what did we say, about $2,000.00 Glenda, per

i f3 67 b

1 gage?

2 MR. FUNCHES: For an industrial gage we had 3 assumed that one amendment per year -- I think the 1 4 inspection frequency is once every three years -- whatever 5 the inspection frequency is. You have to have a renewal 6 every five years. .The average cost per year, I think we had 7 $1,000.00 up there. Now, it would be increased to about 8 let's say $1,200.00.

9 MR. PARKER: Let's assume that it's $1,200.00.

10 MR. FUNCHES: For what he just talked about.

11 Recognize that what that doesn't cover is any effort in '

12 research, any generic effort related to looking at gages,

()13 any rulemaking related to gages.

14 MR. PARKER: The reason I bring it up is that 15 Massachusetts is next door to New Hampshire. There is 16 somebody in Massachusetts that has ten industrial gages. He 17 only has to go -- we are so small up there in the corner of l

18 the country -- he walks across the border and gets it for l 19 $45.00. I think we ought to discuss that.

20 The reason I focused on that is, that's the one 21 that I have picked up from the questionnaires. The 22 difference between this $45.00 and what NRC charges and how 23 that impacts on the states who are non-agreement states.

24 MR. BOHLINGER FROM LOUISIANA: Our regulatory 25 programs within the Department of Environmental Quality and O

l l

1 all the agencies charge fees. Some receive EPA gr; .es and 2 we receive a small amount of general funds, 15 percent.

3 That general fund normally supports the non-revenue 4 generating services such as legal personnel, fiscal, office 5 of the secretary.

6 Unfortunately, they spread that general fund among 7 all of the programs. We collect 100 percent fee to support 8 our program but they supplant that with general funds to 9 support these other non-revenue generating programs. So, 10 whenever there's a budget cut statewide the governor says he l l

11 needs to collect 20 percent of the general fund. We are l 12 vulnerable, to have to increase the fees to offset that 13 shortfall.

14 our program costs, we took the simplistic approach j 15 that Jessie suggested, based on historical data. We knew 16 how much our budget was each year and to start our program 17 off we estimated the number of FTE's in each of our revenue 18 generating programs. We used radioactive materials, x-ray 19 and emergency preparedness, and allocated each person to a 20 certain percentage of each of those programs. Just by 21 dividing that by the TO, we came up with the total program 22 cost, and that's what we requesting by the department. It 23 is all done interdepartmental, as far as our budget 24 appropriation.

25 To get our fees we looked at the NRC fee schedules O

m 69 1 and looked at other state schedules,and we considered things 2 such as inspection frequency, the potential hazard 3 associated with the radioactive material, the time it took 4 to review the amendments or prepare a license and things 5 such as this and came up with what we think is an 6 appropriate fee schedule.

7 It's over the years, it has increased quite a bit 8 due to these budget cuts and lack of general funds. We used 9 to get some supplemental funds from the general 1

10 appropriations but we don't anymore. The only general fund j 11 that we get is what I said, to supplant the fees that are i 12 used to support the services within a department.

\

("%)

v 13 It's a very simple approach but we include the 14 indirect, the direct, overhead -- it's all included but it's l 15 done in a supplemental. I 16 MR. BORCHERT FROM NEBRASKA: Are your fees i 17 specified in a rule and reg?

18 MR. BOHLINGER FROM LOUISIANA: Yes. We have to go l 19 back and change the rule each time we increase our fees, l 20 yes. We do have a dedicated fund. It all goes into the 21 environmental trust fund and it's all kept within our  !

22 department.

23 MR. BORCHERT FROM NEBRASKA: You can spend that in 24 your program then?

25 MR. BOHLINGER FROM LOUISIANA: Oh, yes.  !

i

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7

($)

1 MR. FRAZEE FROM WASHINGTON: And, you can cross 2 over into program areas?

3 MR. BOHLINGER FROM LOUISIANA: Within a division 1 l j

! 4 you can. Like in our division I can go between various i 5 programs, between x-ray and radioactive materials. We need 6 to -- we can't go between divisions. Like I can't take 7 money out of air quality. See, we are part of the Office of 8 Air Quality and Radiation. We can't take Air Quality 9 division funds and help out radiation, which we used to be 10 able to do.

i 11 MR. HILL FROM GEORGIA: Our fee program has been I i

12 evolving since 1983, when the very first fees were l 13

( established and were just an annual fee that was set up for 14 our x-ray registrants and radioactive material users. I 15 don't know if I want this on tape, but we had a very good 16 voluntary fees system. There was no enforcement associated 17 with it. We invoiced, and after the second invoice if they 18 didn't pay we dropped it, because it was a policy and not in 19 a rule or reg and not in statute and not in anything.

20 Nobody challenged us. It was small fees.

21 The previous program manager or director said he 22 wanted fees and the boss said fine, so that's what they did.

23 Our current fee structure is based on board policy. It's 24 not in the rule or regs, it's on the policy of the board.

25 When we set it up we went to December of 1989 NRC proposed O

l I

l

)

O 71 U

1 rules and took the fees that were proposed there, and' J 2 established that to our program for our licensing, ,

3 inspection and amendments. When that rule was finalized NRC 4 . fees dropped a little bit as I recall, generally. A few 5 dollars here,'$20.00.or $40.00 or something like that.

6 That is the fee structure that we currently are j 7 using. It generates enough funds for about 50 percent of our 8 budget needs for this fiscal year. We now have been 9 charging fees based on that since July, 1990.

1 10 This is the second fiscal year. We will'have zero 1

11 appropriated state dollars starting July 1. We have to l

12 collect 100 percent of our fees for radioactive materials.

]

13

( So, we relied on NRC again, simple approach. We took their 14 fee schedule with the annual fee and looked at that at what j 15 it was going to be and are proposing -- and I don't know 16 what the Board will approve -- increasing our inspection-and 1

17 licensing fees in accordance with NRC and going with one- ]

I 18 third of the NRC's annual fee.

19 We are using the two-tiered small entity schedule 20 also, and are estimating what our revenues will be based on 21 previous data from a number of licenses that terminate as a  !

22 result of the fees going up. We do have a few. We lost 1

23 about five percent two years ago. We pretty well stabilized l 0

24 at that point. ,

-- 2 5 We have in the past and I guess we will continue I

, ~ . - , , , , , , -- - - r. ,,.

. - ~ . _ . . . - - --- __. . - - - . . . .

l t 1 to, if anybody wants to terminate we don't charge them a fee 2 to terminate. We let them use those dollars to dispose of 3 their radioactive material.

4 All of our income is treated as miscellaneous 5 income. It is handled by the budgeting folks. It goes into 6 an account or whatever until we do a budget amendment and

! 7 amend it into our budget. We get it back then. It goes in 1

8 generally at the division level not at our program, so not 9 necessarily 100 percent of it goes back to our program but ,

I l

10 100 percent of our needs come from that. ,

l 11 MR. BORCHERT FROM NEBRASKA: Are there any further 12 questions for Tom?

13 [No response.]

s-14 MR. BORCHERT FROM NEBRASKA: At this time we take 15 a break and will reconvene at 10:45.

16 (Brief recess.)

17 MR. BORCHERT FROM NEBRASKA: Let's go ahead and 18 get started again. It's a little bit ahead of schedule, but 19 we have a long way to go. If everybody will be seated, 20 please. Every time I go to a meeting I always hear people 21 say take your seats, and I am not sure where you are

]

22 supposed to take them to. So, I kind of refrain from saying 23 that kind of comment.

24. MR. HILL FROM GEORGIA: I would like to make one 25 or two clarifications. I said voluntary fee system. That

!D L)

73 1 was in-house voluntary. We didn't let our licensees and 2 registrants know that. That was from 1983 through 1989. We 3 enlisted an annual fee, and it was based on policy that was 4 generated. The management said yes, go ahead and charge 5 fees and it was done.

6 About 90 percent of them paid, and that was a 7 pretty good collection rate. It was a small fee and 8 enforcement wasn't tough, because we didn't enforce it. We 9 weren't going to -- that's the reason we call it voluntary 10 because we didn't enforce it.

11 With the policy that we have now -- Board policy -

12 - let me back up. One other thing through 1983 through

( 13 1989. It was put into the appropriations act that there 14 would be some fees collected. So, there was a little bit of 15 legal basis for collecting a fee, in that the appropriations l 16 act said that we had to collect some fees. It didn't say i

17 how much. Nobody was willing to take that into a court of j 18 law.

19 Currently it is a Board policy. The board is 20 allowed to set policies. The law says -- this is another 21 one that is probably stretched pretty good, that the 22 department shall do whatever is necessary to impl: ment this 23 legislation. They are stretching that real good. If we 24 need fees to implement legislation then we are going to 25 charge fees. It's being stretched.

O)

L

i 1 We also, as a part of the current 1990 forward )

2 fees, put a license condition in. We conditioned the 3 license that you shall pay fees in these amounts. The law

$ 4 says that these can be a license conditioned as needed.

J 5 Now, will that hold up in law or in court, is it going to be 6 challenged. What direction will the department take if it 7 is. I don't know. It hasn't been challenged. I l

8 So, there is still unknowns in it. At this point l I

9 in time sufficient revenues are coming in to support the '

10 program and I trust that it will continue to. l 11 MR. BORCHERT FROM NEBRASKA: Mary Helen.

12 MS. SHORT FROM TENNESSEE: In Tennessee, we have j

()13 just gone through what basically was our fourth calculation 14 period concerning program costs. Actually, second total 15 calculation, fourth being that we have done two for the 16 license program and two for the x-ray program.

17 We started collecting x-ray registration fees in 18 1983 per legislation and radioactive material license fees 19 in 1987 per legislation. The State of Tennessee passed new 20 legislation last July 1 --

it was passed, effective July 1 -

21 - which is kind of an encompassing environmental protection 22 fund piece of legislation for all of the divisions in the 23 environmental bureau of our department which is Environment 24 and Conservation. We are no longer part of the health 25 department in Tennessee.

1 i

1 This particular piece of legislation allows us now j 2 to set fees by regulation as opposed to individual fees 3 being legislated. In doing this we have recalculated.the 1

4 . program cost not based on just the cost of the program as it 5 'was but based on the cost of the program as it should be.

6. Probably most of you know that Tennessee funds itself-l- 7 inadequate, and in compatible with'NRC. We have baan for 8 three years now --.is that right, Carl?  ;

! l l 9 MR. KAMMERER: For too long.

I H

! 10 MS. SHORT FROM TENNESSEE: Basically, the' l 11 inadequacy is related.to the fact that even though we have  !

j 12 had fees and we have collected fees and we have had dollars  !

()13 that should have been-available for operating the program,

! 14 the state of Tennessee has not had sufficient funds to l 15 operate other. program. Even though our fees and funds are 16 dedicated we have not been allowed to spend them. They have 5 17 been frozen.

18 Since 1988 we have had a 90 percent turnover in b 19 very highly trained staff. We have been able to hire a few 20 folks off the street but very few, because most of our li '21 - positions have become frozen as they have been vacated. We i

j 22 are in a position of having lots and lots of dollars, carry

, 23 forward dollars because they were dedicated, but we can't do 4

24 anything with them as far as operating our programs.

{j _

j 25 Anyway, the calculation for the cost of the iO r

3 d

i

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

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1 1 program is based upon numbers of licenses and numbers of I 2 staff that are needed to take care of those numbers of 3 licenses plus numbers of staff that are needed to take care 4 of the x-ray program, to the extent that the inspection P

l '5 schedule for x-ray tubes is legislated as opposed to just 6 regulated.

]

f 7 MR. BORCHERT FROM NEBRASKA: Eddie. l l 8 MR. FUENTE FROM MISSISSIPPI:- One of the

} 9 recommendations that Jessie made is to keep it simple, and I l .

10 did keep it simple. In 1976 only a few states were i 11 assessing fees at that time. State monies were becoming a l 12 little thin at that time, so an avenue for' supporting the 1

13 radiological health program was the implementation of fees.

(

14 When I introduced the legislation I had hopes of l 15 having the fee schedule in our rules and regulations. The f .

16 legislators didn't like that idea. They wanted'to have some  !

L 17 idea of what kind of fees we in Mississippi were assessing i

18 our licensees and registrants. I had to hurry and gather up j 19 whatever information was available from the few states that

20 did have a fee system at the time.

21 I looked at my neighboring state of Alabama, and

{

22 either that year Aubrey had introduced some legislation j- 23 addressing fees, either that year or just the previous year. l

', 24 So, I kept it simple. I used his legislation. He had 4

~

25 already done the leg work and categories of fees for the 4

4

, - .- - - , - . -i,, e ---r -- g ,

, 1 different licenses and registrants and what have you.

2 I took his piece of legislation and rewrote it and 4 3 testified before some of the Committees and said our 4 neighboring state of Alabama -- this is the fee structure 5 they were considering charging, so it went through the 6 Committees, the House and the Senate. That's how we 7 established our fee system in 1976. Aubrey had trouble with

{ 8 his. He will tell you about that later, I am sure.

9 We have had fees since 1976. We have had them 10 revised several times. The last revision was in 1991. We .

l 11 are one of the several states that still have state l 1

12 appropriations in addition to our fees. As the state IL./

) 13 appropriations are cut we increase our fees. As Mary Helen 14 just stated, we do have monies. Our fees are dedicated. The 15 radiological health operations fund, it goes in the State 16 Treasury but is identified as radiological operations fund, 17 to be used to supplement state appropriations to run our l

18 program.

19 It's an annual fee. I think over the years we have 20 been very successful in collecting our fees. I forgot the 21 exact percentage, but it ranges anywhere from 95 to 98 22 percent collection rate which I think is good, for the 23 number of years that we have been collecting fees.

24 The most vocal group back in 1976 when we I

25 implemented the fees -- and I had to go around to the

1 different parts of the state to tell them about the fee 2 schedule and the fee structure, what it meant and all this 3 and why we were having to assess fees. The most vocal group 4 were the dentists. I would go to the district meetings and 5 talk to them. The questions that they raised -- just like 6 NRC, Congress has directed them to 100 percent funding.

7 We have not gotten to that stage. Maybe some 8 years ahead we will probably have to consider 100 percent 9 funding but not at this time. I immediately told them, I 10 said go to your legislators. If you have concerns and if 11 you don't like the fee structure, go to your legislators.

12 They are the ones that passed the legislation. Each time --

()13 and we have revised them a number of times since 1976.

14 In 1991 was the last and the previous was 1986 --

15 there was about a five year period before we did anything I 16 with the fee schedule. Each time it's the dentists who are 17 concerned about a little $35.00 per x-ray tube.

18 As long as we continue to get state appropriations 19 we will maintain our fee schedules as they are. The simple 20 way would have been through the rules and regulations, where 21 the state board of health would have had the governing power 22 of dictating what changes in fees were necessary at the 23 time. Now, I have to go to the legislature.

24 MR. BORCHERT FROM NEBRASKA: The legislature sets 25 your fees for you?

I 79

[V) 1 MR. FUENTE FROM MISSISSIPPI: I establish them. I 2 have to submit something to them. This is what I propose.

3 We have had some reduction in fees since 1976. They have 4 not always been increases. There have been some reductions.

5 I have to submit a fee schedule to the legislature.

6 MR. BORCHERT FROM NEBRASKA: That becomes set in l

7 statute?

8 MR. FUENTE FROM MISSISSIPPI: Yes.

9 MR. BORCHERT FROM NEBRASKA: That seems rather 10 cumbersome.

11 MR. FUENTE FROM MISSISSIPPI: Not really. Once 12 again, you collect information that is available from what

()13 other states -- particularly the surrounding states -- what 14 are they charging for the different categories of licenses 15 and x-ray tube registration.

16 MR. BORCHERT FROM NEBRASKA: You said that you 17 went around to all the groups in the state and talked to 18 them about your fees, and the dentists were the ones that 19 complained the most.

20 MR. FUENTE FROM MISSISSIPPI: Originally. And 21 they still have complaints.

22 MR. BORCHERT FROM NEBRASKA: One of the things 23 that we did when we were starting our fees, I sat down with 24 the dental association and some of the leaders of the dental 25 association and just threw the cards out on the table. I O

.- . _ -- - .-. . . _ - - .- - . _=

l

( 80 1 said here is what we need for our program. They shot at me 2 for about an hour, and finally they decided that wasn't too I 3 bad and got behind it. When we had our public hearing the l 4 dental association as a whole came in and supported the l 5 fees. There wasn't one complaint from the dental J

l 6 association at all.

i l

j 7 MR. BAILEY FROM CALIFORNIA: You have a very 8 persuasive way of speaking.

~

9 MR. BORCHERT FROM NEDRASKA: Yes, I did. ,

I

'10 [ Laughter.)

11 MR. BORCHERT FROM NEBRASKA: I am being very 12 modest, you understand.

13

( MR. BAILEY FROM CALIFORNIA: I remember one l 14 rulemaking procedure where the dentists sent in 700 letters e

15 on fees. The dentists were the ones that I have always seen 16 that object to the fees. The more you met with them, all I 17 you did was provide them with information so that they could 18 back and shoot. We made a huge spread sheets of here's why ,

t i l

19 the cost and here's this and this. They come back and you 20 would have something down like restoring file, .038 cents 1  :

21 per day. They would say wait a minute. In our experience 22 it only costs .0375 cents, and they wanted to argue about 23 crap like that.

24 MR. BORCHERT FROM NEBRASKA: These folks went and 25 sold it to their general membership, and we didn't get one I~)

(_/

1 l

l I

1

E

[

()/ 1 complaint through the hearing process. Every one of them 81 1 2 was supportive. In fact, we got several letters that were 3 supportive from the dental association.

4 MR. HOKEL FROM IOWA: What is your fee?

5 MR. BORCHERT FROM NEBRASKA: It's the same as 6 everybody-else's capped off in the statute, .$75.00. What we 7 did.was figure in an inspection frequency. We visit ,

8 dentists once every four years, and-we reduce the fee by a 9 factor of four. We also have a base annual fee that we 10 charge everybody for setting up and maintaining the files.

11 MR. BOHLINGER FROM LOUISIANA: You charge 12 different fees for different categories?

MR. BORCHERT FROM NEBRASKA:

( 13 Yes.

14 MR. BOHLINGER FROM LOUISIANA: Dental being the 15 cheapest? j 16 MR. BORCHERT FROM NEBRASKA: Dental and 17 veterinarians are the cheapest. j i

18 MR. FUENTE FROM MISSISSIPPI: Just further j 19 reviewing the situation, I know all of you get involved with 20 legislation and testifying before Committees. Looking back 21 in 1976 there had to be an educational program, educating 22 the legislators just what radlological health is and was at 23 that time, what were you doing.

24 In that particular year I spent --

I don't know 25 how many days I spent on the Senate floor. Those of you who O

1

/]

V 82 1 get involved, you have to be invited to even appear on the  ;

2 Senate Floor. I appeared so many times, I started voting.  !

3 (Laughter.] I 4 MR. FUENTE FROM MISSISSIPPI: The Sergeant at Arms 5 saw me voting and said you are not supposed to be doing 6 that.

7 MR. BORCHERT FROM NEBRASKA: Terry.

8 MR. FRAZEE FROM WASHINGTON: I did bring some 9 overheads. I didn't realize how you were going to have the 10 thing set up, so my presentation really is the full shot.

11 We have the privilege in the State of Washington of having  ;

12 ten years of experience with this developing fees. We had  !

,h 13 out jump start from zero to 100 percent --

%J 14 MR. FUENTE FROM MISSISSIPPI: Excuse me. Move the 15 microphone over, please. We can't hear you with the 16 overhead.

17 MR. FRAZEE FROM WASHINGTON: Just general 18 orientation, these are the current typical fees that we 19 have. The number of users in the left-hand column. We have 20 a number of fee categories, portable gage user is our most 21 populous category. We only charge them $500.00 a year.

22 They really scream about that, but that's typical of 23 everyone. Our single highest fee is $12,000.00 a year for 24 the broad scope A. These are all annual fees, and that's 25 all we charge are annual fees with the exception of some

/~'%

U

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L l

[) 83 V

1 special fees.

2 We charge for reciprocity, 100 percent. If you i

3 are a radiographer and you want to come in our state, you 4 are going to pay $4,700.00 even though you only get to use 5 it six months out of the year. Hey, you are going to pay 6 the full freight. We make money off that one. Obviously, 7 we don't always get out in field site inspections and we 8 certainly don't do any licensing actions. That's what we do

9 cover in the annual fee is everything.

10 Like I said, we got a jump start in 1982. The top

, 11 line with the little squares is our program budget. We were l 12 on a continuing increase in our budget in the early years j( 13 until the fees hit. In 1982 we started fees. We phased 14 them in which was sort of a mistake. I think because of the

)

15 size of fees, so I wouldn't recommend phasing them in over a l

16 five year license renewal cycle. We started that, and l

17 quickly it became apparent that the licensees who were i

18 paying large fees really objected to the fact that there l

4 19 were will some licensees out there in that particular year 20 who did not.

21 The radiographers were a very vocal group in that 22 regard. They were paying at the time, like $3,000.00 a 23 year. A big economic disadvantage to the folks that were

}

24 paying a fee as opposed to those who weren't. In 1983 we 25 upped it, so that we tried to collect 100 percent. It 4

4

]

[~

84 1 doesn't work. We came close -- that's not close at all --

2 and at the same time realized that we have problems here.

3 We have to reduce the number of staff and everything.

4 over the years we have tried very hard to end up 5 with 100 percent fee. A later slide will show that more.

6 Some things like -- that's a mistake. It has to be. There 7 is no way, when we are doing two year budgeting cycles that 8 we would have ended up with more money than we expended. I 9 think what happened in that particular year is, the low 10 level waste site also collects a bunch of money separately 11 from the materials program. That money was inadvertently 12 put into our account. I have lots of stories like that.

( 13 That's one of the things you are going to have to 14 watch, is the budgeting folks. They have a whole language 15 all their own, and you have to start learning that. You 16 have to start really digging into what they are really 17 doing. I guess the last thing to point out is that our 18 budget took a dip and is continuing to increase.

19 The next slide is, again, not squares or pluses 20 this time. That's the budget. You notice that it 21 continued to rise a couple of years after fees started and 22 then it kicked in, the realization that we have to cut back 23 on staff because we are getting a lot of heat. Our budget 24 dropped off, corresponding to the fact that we dropped 25 staff.

'85 1 You will also notice that our staffing level has remained 2

constant at --'that's six technical staff. That's only the 3 technical staff that we have plotted there. It's an 4 exaggerated scale for the staff.

5 Notice what's happening to the budget. This is 6 another thing. We thought in 1982 we were. capturing 100 7 percent of our program costs -- not so. We were in a big 8 agency. That agency had some things that they call cost 9 pool items, and printing costs, postage, motor pool --

10 certain things -- phones. Certain things that the agency 11 paid for out of a separate kitty that they.had for 12 operational purposes. Well, gradually those things started

( ) 13 kicking back down to the program level where we had to pick 14 them up in fees.. Those are the cost pool items.

15 There are also the Attorney General. A different 16 program area had to pay for that. Had to pay for laboratory 17 support which is a different program within our agency.

18 Pretty soon we had to start paying for our receptionist and 19 our share of the receptionist and our share of the division 20 director and his secretary. That's one of the direct 21 overheads. Now, not even on here yet, they are telling us we I 22 are going to have to start kicking in for what are called 23 the indirect overheads. Those are the Secretary of the 24 . Department of Health and all of her staff and that support.

25 Our fees are going to go back up again.

O

d F

86 1 I will try to hurry through these things because I 4

2 realize we are short on time.

3- The impact on the program. This is the total i

l 4 number of licensees from 1980 which is before fees, 5 relatively constant, increasing a little bit. In 1982 when i 6 fees kicked in we experienced a significant drop in the 7 number of licensees over that period of time we were phasing l 8 the fees in. It sort of leveled out for a while, and now 9 it's on an upswing again. We are ahead of where we were

10 back in 1982, but it's taken ten years to recover basically.

11 What happened to the individual types of

12 licensees. The exception to the rule -- they all fell 13 except for the industrial licensees.

( That would be portable l 14 gage users and fixed gages, not industrial radiography which 15 we have separately. Industrial radiographers experienced 16 basically a 60 percent drop in just the few short years of i

17 1982 to 1984 when fees were coming into place. It was a i

18 quantum leap drop off and they have been relatively constant l 19 since then. We experienced the same thing will colleges, 1

l 20 kept as a separate category.

21 The medical licensees -- medical licensees have i

2 22 continuously declined from 1980 to present. There was a 23 more significant decline in 1983 to 1985, again 24 corresponding to fees.

4 4 25 MR. BLANTON: Jerry, does that include your 4

i

1 general medical licensees or just the specific?

2 MR. FRAZEE FROM WASHINGTON: Just specific. What 3 we call our in vitro licensees are registrants -- general 4 licensees -- are completely separate. Yes, they also 5 experienced a drop off.

6 MR. BAILEY FROM CALIFORNIA: Do you issue a 7 separate license for teletherapy, and is it included in that 8 number?

9 MR. FRAZEE FROM WASHINGTON: The answer to ,

10 teletherapy yes, we do. I am surprised, but we do have 11 about two left, and they are going down the tubes too.

12 Probably why I put up the medical on the screen is to note 13 that there is a continuous decline. You could say that

(

14 that's the impact of regulation, the increasing regulations 15 placed upon the medical community that might account for 16 some of that decline in addition to the fees.

17 Teletherapy, at one time, was a separate license.

18 We incorporate it into the single license now just for 19 convenience.

20 It all goes back -- and you will find this is true 21 for everybody. 3verybody is going to have a different 22 statute authority, and that's really going to set the 23 groundrules for how your license is going to develop. It's 24 obvious to all of you that that's exactly what's going to 25 happen. In our case our legislature -- again, fiscal crisis

)

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

.y

88

's 1 time -- said you all can go out there and charge fees up to l 2 but not exceed, the cost of actually doing the licensure of d

3 the activity or class of activity. Oh, by the way, you can 4 include the cost of necessary inspections. From the first, t

i 5 that was what we went out to do was, we will charge a fee

?

G for licensing and inspections.

7 One of the problems there was how do you define j 8 class of activity. I notice that some of you have already 9 mentioned including x-ray into it. We really wanted to do

10 that. We wanted to do that in the worst way. It would have 11 been really slick to say radiation user and charge x-ray and

, 12 materials all the same fee. It would have been.$200.00 13 which was pie for the time.

(

l 14 But the dentists, of course, really came unglued.

15 They come unglued just because of the fees that we did have, 16 let alone the $200.00 one. Our next shot was how about 17 radioactive materials user. That would have been about j 18 $1,000.00 a year per licensee at the time. Again, we felt 19 because of the way that the statute was worded and just 20 didn't feel right we would go through and divide up our fee 21 categories based upon the types of use, particularly where l

. 22 we had a significant quantity of users. Quantity up there 23 means something different.

24 obviously, portable gage users, that was an easy J

25 handle that we could say we have 160 of these guys. They 1

1 l

l l

1 must have some commonality, and they probably all will have 1

2 some good experience knowing how much to charge for those l I

3 folks. On the other hand somebody who is a laboratory user, 4 we put it on the basis of quantity, grouped quantities.

5 Small users, medium size users, large users. We set the 6 ' demarcation points associated with the type of review that 7 might go on. In a large laboratory we would really have to 8 get into a lot of ventilation calculations and things like 9 that.

10 If they are really large enough, contingency 11 planning. It was those types of dividing points. We tried 12 to keep it simple, in the sense that it was just small,

()13 medium and large. Obviously the license review effort, 14 inspection frequency have all been mentioned. We tried --

i 15 at least we said to our licensees -- this is based on public 16 health significance. We are going to charge you a fee, but i

17 it's going to be based upon your public health significance. l 18 If you are a radiographer you are more hazardous i

19 than everybody else, so we are going to be there more often.

20 Because we are going to be there more often and watching 21 more closely, you are going to have to pay for that time 22 commitment. It was a public health significance.

23 This was a jump start, from zero to 100 percent.

24 We had to get out there and going in a hurry. We started by 25 sitting down with compliance supervisor and the licensing

l t

(~T- 90

\_)

l 1 supervisor and we said gee, how much time is it going to l 2 take to do the preparation for an inspection, the actual 3 inspection itself, writing it up, compliance letter. How 4 about follow ups, and that was just the inspection part.

5 Licensing. How long does it typically take to do 6 "x" type of license. Of course, the first_ thing was, we had  !

7 to define what our categories were. We went through a very 8 complex estimation of what the we '.c time should be. We 9 factored in some slop time for administrative time for 10 staff. You are not always out there inspecting. You are 11 back in the office reading the in basket. That's a real hard 12 one to explain to the licensees. Training, calibrating

()13 instruments, all sorts of other things thrown in. You spent 14 two hours in the field and you had to throw in at least one

.15 more hour of just time. You have to account for it somehow, 16 but it's not direct service time.

17 We threw in a factor for support services, 18 clerical and also a factor for supervisory time, and cranked 19 that out into an estimate of how much time it should take to 20 do this program. We thought we were doing a real good job 21 at that and that estimate. We came up with different costs 22 for each of the individual categories, out fees for the l 23 categories.

24 Then we made a big mistake. We said okay, this is

25 the basis for our fees and now licensees, we are going to

()

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l i

. . . - _ . _ _ . = _ - -

I i

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s_-

91 1 keep time. We are going to actually sit down and record 2 every bit of time that we spend so that next year we will '

3 come back to you and prove to you that we really are serving

! 4 you. We are providing you that service, and we will show

. 5 you right on a time sheet. That was a big mistake.

6 Before we get off this slide, the last thing was -

7 - this was more associated with how we set up fee ),

8 categories. We tried to set them up according to the types 9 of use. The biggest problem with that, particularly in 10 analyzing staff time, is if you have very small categories l

11 where there's even up to ten licensees in a category. I l

I 12 That's real difficult to try and make a bell curve out of

( 13 and come up with something reasonable. Of course, L all 14 understand why there would be variation.

15 In terms of just why did we pick an annual. We 16 sat down and thought about it, and we rejected the NRC j i

17 approach which is by action. As far as we were concerned, l l

18 it discouraged communication. If a licensee is going to  !

19 call in and say something happened the other day and we 20 would like to talk to you about it, if our reaction is going 21 to be jump out there and do an inspection and charge them a 22 fee, pretty soon they are going to think twice about calling 23 you up and talking to you. We want to talk with our 24 licensees.

25 We recognized even at the time that we were going

C')

1 to have a problem in dealing with licensees and it certainly 2 happened. The fees have really c ine between us. In 1981 l l

3 and before we had a real positive relationship with our I 4 licensees, when the fees hit it went downhill in a hurry. I 5 can report to you today that it is certainly on the upswing.

6 We are doing much better.

7 There are just some various problems, whether it's 8 by amendments or whether you charge them an hourly fee, 9 clearly they want you out of there. They don't want you 10 expending any more effort that they are going to be billed 11 for. We rejected that. There's also a lot of 12 administrative support time that you would have to throw into that, and that's costly too.

}13 14 The annual rate -- the down side of the annual 15 rate is that they want something for their money. That's a 16 downside, but it's also a very good side. That, in the long 17 term, is going to serve us a lot better than anything else 18 we have going for us because of things that I see coming up 19 in the future. The annual rate has been what we chose.

20 Getting more to the point of what you asked for 21 now. In building our program budget we started out by 22 looking at our workload and building it basically from the 23 bottom up. That was at a point in time in our department 24 that they weren't really concerned about a lot of other 25 things. They just said charge the fees and collect 100

93 k

1 percent of your budget.

2 Later on the Department now is taking more of an 3 interest in how that's happening, and they are wanting us to 4 incorporate more of the overhead into it. Having built a 5 system one way, they are now coming back and tell us we want 6 you to apply this particular fee template which is just 7 their way of dictating how to charge the fee. That is, of 8 course, based on the administrative overhead, both direct 9 and indirect.

10 One of the interesting things about our fee 11 template is that it starts with the number of staff that you 12 have, staff right now, and then it goes from there. If you

( ) 13 suffer a loss in the number of licensees, if your income is 14 low, you don't decrease the size of your program you 15 increase the fee. What happens -- and that was probably 16 more apparent one some of the earlier slides -- we get into 17 a case where you increase the fee and the licensees drop 18 off. You increase the fee to compensate and more licensees 19 drop off. You end up what we call a death spiral. It's 20 heading right on down to zero.

[ 21 Having determined what our budget should be, 22 whatever it happens to be, there are some things that we had 23 to account for, terminations, death spiral. We guessed 24 wrong. Every time we have done it we have guessed wrong as 25 to how many licensees would bail out on us. We have had O

. . . ~. __

[)

%./

94 1 some pluses and minuses. Reciprocity certainly is a plus.

2 It's something that we do not deliberately account for that, 3 and we don't really account for additional services because 4 they are hit or miss. Maybe they will come and maybe they 5 won't.

1 j 6 The other thing that's a minus is a small business 7 discount. Again, as in Oregon's case as I am sure in other 8 programs, we are supposed to protect small business and not 9 over regulate small business. That includes fees. We chose 10 to provide a 25 percent discount if you qualify as a small 11 business. Again, just like in other states where the statute 12 is going to differ, our definition of a small business 13 differs as well. For us it's a 50 or fewer employees in a 14 for-profit corporation, partnership, et cetera, and also not 15 a subsidiary of a larger corporation. It has to be truly a  !

1 1

16 small business.

17 As far as getting on to the rest of it, once you 18 have the budget established you have to figure out how you 19 are going to prorate it. In our case it's 100 percent.

20 And, 100 percent means just that. We do not have state 21 general funds. We only have whatever our fees bring in. At 22 the same time, they are also not dedicated either. It's use 23 it or lose it, and if you don't make it you can't spend it.

24 In ten years we have always said we wish we had 25 something to fall back on. We wish we had at least some

i

]

1- level of state funds as a cushion -- 100 percent. You

)

2 charge 101 percent, and you can't charge 98 percent. If you ,

3 charge 98'or 99 percent that'means whatever that one percent .

4 is you can't spend it. You can't spend any more-than the 2

~

} 5 lesser of your budget, your allocated amount for the amount  :

6 of revenue that comes in. l 7 This is just an overall timeline. The reason that

8 I said that timesheets was a big mistake or at least i 9 promising that the licensees -- we would make some 4

10 adjustments -- we ended'up our first year minus 50 to plus l 11 376 percent change in the license fee was proposed based I

12 'upon our one year of experience with our timesheets. It

{I)13 j \./

caused a lot of grief. In fact so much grief, that when we i 14 tried to change the fees again in 1984, a year later, we had

( 15 a lot of feedback from licensees and from their legislators.

5 11 6 We had a miserable time.

I J 17 In 1985, again -- we have three years of 1

j 18 experience here. Timesheets surely must be reasonable at i

19 this point. Again, minus 54 to 548, trying to make it all 20 line up with our timesheet history. It didn't match up.

21 People who were pleasantly surprised in 1983 to get a 50 22 percent decrease ended up with a 500 percent increase two 23 years later an'd vice versa. People who went up went down, 24 and it was just a real jumbled mess.

25 We got called on the carpet by the Legislative O

96

[~)h k-1 Rules Committee that year, because of this fiasco. In 1987 2 we said forget it, we are not going to try to mess with the l 3 timesheets. We do learn from our mistakes. Actually, we 4 don't. We tried a percentage increase in 1987 and got it 5 through, but we also ended up in 1990 setting a lot more 6 static in our proposals. Back before the legislature again.

1 7 In 1991 just recently, we were able to increase our fees 8 again because of the delay -- large increase is 27 percent.

1 9 Again, the change was 18 to 23 percent, all up.

10 I guess just to sort of summarize or cap up here.

11 These were the major difficulties. I have talked about j i

12 having to hit 100 percent. That's if you only have your own 13 budget. Your budget only comes from fees and you are stuck.

(

14 If you don't make your fee revenue you have to cut back on 15 staff or someplace else. of course, in our case, every year 1

16 they kept coming up with a new cost to throw into the I 17 program. You really have to figure out what 100 percent l 18 cost means.

19 The death spiral, I think NRC is just into it.

20 They will find some more that will drop off this year.

21 Every time the fees go up you are going to lose a few more.

22 We used our timesheet data way too soon. We should have 23 never done that. We also had a period of time in which 24 licensees convinced us that come on, I only have one gage l 25 and should only pay for one gage. If someone has two gages l c'~)

lkJ

i

1 they should pay for two and so forth. We did that for 2 portable' gages and for radiographers. Boy, that is a waste.  !

l 3 of staff time. r

' t 4 What happens is, as the economy changes they will ,

3 5 decide we don't need.three gages, I only want a license for i

j 6 two. Administrative amendment. They put in the amendment-7 request and you expend your energy, simply to change the per l

I i

q 8 device authorization on the license. That's definitely not l 9 a smart thing to do, just because it wastes time. Billing j

?'  :

l I

! 10 and revenue receipts were actually on those other slides.  ;

j  :

11 I guess the bottom line there is that ours is done l l

j 12 by a'different program within our agency, and you really

]

have to have good communications. We have lost a lot of

( ) 13

14 money because we weren't talking to them or at least didn't-i l 15 understand their language. They didn't understand what to a

16 do. Procedurally, things have fallen through the cracks.

4 .

j 17 Money has appeared mysteriously and that's always nice but i'

18 at the same time it also disappears, and you don't have a 19 good way of tracking it if you don't understand their l 20 budgeting and also the billing and revenue receipts.

4 21 The part about unexpected collection costs, in 1

j 22 1982 the department said no problem, the department will l 23 take care of any of the collection efforts. That was a nice i I^

24 thought,-but the program got rooked into it anyway. Our i

25 Attorney General said that we have to exhaust our i

d a

1 administrative remedies before they can go out and do any i

3 2 real collections. So all of a sudden, our billing people 3 bill them. If they don't pay it they refer it to us, and we 4 are stuck going out there and issuing the final notice.

5 Then, if they don't pay up we suspend their license. If i l

6 they don't pay up still, we are.the ones going out there and 7 recovering the gage or whatever. We have done that.

8 Our history is just studded with lawsuits, sued 9 over this whole thing. We have had heavy duty 10 administrative hearings because of fees. We have had 1

I 11 several -- more than several -- a handful of licenses that  !

12 we have had to suspend, escalated enforcement actions. You 13 s

( know, public health and safety hasn't been a factor in any i

14 of them. In fact, public health and safety has -- we have l 1

' l 15 never suspended a license for public health reasons, only H 16 for cotton picking fees. That's a real pain.

4 17 In our case -- I realize that in many cases you I

. 18 can cross program boundaries with your dollars. We cannot.

19 Our money from licensees has to be spent on licensees. Even 20 if it's radioactive materials it has to be licensees. IF we 21 find a radium gage from World War II that is smashed and

, 22 contaminated something we say oh, we have to solve that l

i 23 public health problem we have to get our money someplace 2 24 else. That someplace else does not exist.

l 25 MR. O'DOWD FROM NEW HAMPSHIRE: In that case where i

J

_- _ . . . . =- . - . -. - - - .

l l

I) 99 U

1 would you get the money? What if I called Terry Frazee. I 2 have an idea that you are an expert in a particular area i

l 3 that I am not familiar with. You spend a half hour with me 4 on the phone for instance, who is that billed to?

5 MR. FRAZEE FROM WASHINGTON: We cheat.

6 [ Laughter.]

7 MR. FRAZEE FROM WASHINGTON: Literally, that's it, 8 unless there is_a lot of money. The legal situation in our 9 state is that we cannot legally spend the money like that.

10 In practical matters they never looked at in the department.

11 The people that would lose their job -- I mean, if money is 12 misspent from one category to another it is going to be f 13 somewhere well up above me, so I don't worry that much about

(

14 it. It's not that much money either, when the final 15 accounting does come.

'16 It is a concern. We sit there every year and we 17 worry about that. Is this the year they are going to look a 18 little deeper into the program. Are they going to find out 19 that we spent $80,000.00 in licensee funds to take care of 20 Chernobyl. We spent lots of money on Chernobyl and other 21 things as well. We have to worry about that, and I hope the 22 situation is different in your states.

23 We certainly would like to have some general fund 24 money. I am sorry I am running over. Obviously, there is 25 benefits. Again, even though I say we are generally G

G1

l l

\

1

~-)

1 protected during budget cuts and freezes, I know that it's 2 not the case in other states. They are what we call local  ;

l l

3 funds. It's not state general funds, and that's what has  !

4 been protected -- state general funds are usually the ones 5 that get cut. The local funds increasingly have been 6 protected from those cuts and those hiring freezes until l 7 maybe today, right now. We are getting real close to the 1

8 point where those are no longer are going to be protected in  !

9 our state.

10 One of the other benefits has been just a forced 11 improvement in our knowledge about the budgeting and 12 accounting cycles and so forth. We have had to ask

( 13 questions, and the budget people have had to figure out j 14 exactly what it is they do so that they can communicate it  !

15 to us, improved staff efficiencies, responsiveness to l l

16 clients and so forth. That's important. l l

17 Sort of lessons learned. Timesheets killed us.

18 We did it by licensee in the first few years, licensee and 19 type of activity. Was it an inspection, a new license or an 20 amendment. A lot of staff time went into filling them out 21 to being with, and then into generating the reports that 22 came out of these things. Of course, it just got us into  !

l 23 all sorts of trouble when it came time to change the fees.

24 Certainly, we would like to see a standardized fee l 25 category. We do not use NRC's fee categories. From our l ,

1 l l l

L--_ -

1 l

l

(~* 101 l 1 very first slide you can tell that we -- portable gages, 2 that's a separate fee category for us. We have several 3 different kinds of nuclear medicine categories, we have 4 several types of industrial, several types of laboratory 5 uses. We have some that are really unique, nuclear laundry, 6 nuclear pharmacy. We have kept those separate.

7 We end up with about 39 different fee categories, 8 and some we don't have any licensees in at all. It 9 certainly would be handy if everybody had the same fee 10 category. There are a couple of reasons for that. The 11 biggest one is rate for justification purposes. I could 12 point to the NRC and say here's the fee that they charge for

()13 this particular category without having to -- does it fit in 14 this category or that category. We would all know what they 15 were.

16 It would also be really good if we had categories 17 where there was significant numbers of licensees in them, in 18 order to get a real good handle on how many hours of work if 19 you kept that kind of data, how many hours of work that were

• 20 involved for comparison purposes. Certainly an annual fee 1

21 makes sense to us. There should be something in your budget 22 to take care of something like the radium gages and so forth 23 that end up there. 1 24 What I see right now is that we are moving more 25 towards -- the legislature has just gone through a round of ,

l 1

l 102

( ,

l' cutting.. state. funds. We have all experienced that, and some  !

2 of us -- I heard somebody mention what looks like the next

'3 round of legislative action -- that is, reduce the size of

4. government. They have tried by, cutting. state funds and 5 pretty soon they.are going to figure out that the next i 6 logical move is to cut our appropriations, even though they 7 may'come from a dedicated fund, cut the appropriation.1 i 8 Reduce the size of state government.

9 In a public health agency we already run into.the 10 daily battles trying to justify why we should have-a more 11 extensive program than the AIDS folks. It's not going to.

12 change. I am just saying radiation isn't going to scare ]

()13 people much longer, so we have to be sensitive to that. I l

14 think that our best effort is to move more towards a service 15 orientation. Get the licensees on our side. We have to 16 provide them a service that they want, and if they want the 17 service they will also go to battle for us in the 18 legislature, at least be on our side as opposed to against 19 us.

20 MR. BLANTON: In terms of this business of having 21 uniform categories of licensees across the nation, how much 22 trouble would be in Washington to reorganize your license 23 categories to try and -- would that be a serious problem for 24 you, to have to adjust to something that say the CRCPD made i

25 up as kind of standard categories?  !

/~T j V

l

l l

1 lCE) 1 MR. FRAZEE FROM WASHINGTON: Since I think ours l

2 are pretty close to perfection as it is, probably not much.

3 Seriously, it wouldn't be that much difficulty. Ours is not 4 perfect. I already recognize there are areas where we need 5 to make changes in order to try and increase the numbers of 6 licensees that we group as a category. We are going to be l 7 doing that.

8 I certainly would like see more of a commonality 9 in our fee categories or in the way we do them.

10 MR. BOHLINGER FROM LOUISIANA: Just a general 11 comment, Terry. I don't know how other states draft 12 legislation, but it is possible to structure your dedicated fund statutorily so that it will carry over successive i

)13 14 years. We have managed to do that, and we don't have to go 15 through a lot of laborious exercises and timesheets and all 16 to justify our needs for future and shortfalls in previous 17 years. It can be done.

18 MR. FRAZEE FROM WASHINGTON: How?

19 MR. BOHLINGER FROM LOUISIANA: I will show you i 20 how.

21 MR. BORCHERT FROM NEBRASKA: Ours is carried over 22 too, our cash funds are carried over from one year to the 23 next. They don't disappear.

24 MR. NASH FROM FLORIDA: Florida law gives the 25 Department the authority to set and collect fees to fund the O

v

I i /

104 N_D

)

1 program. I suppose we are fortunate, in that we don't have l

l 2 the high overhead of the NRC for rulemaking and research and 3 things like that, so that the cost of running the program 4 can be adjusted pretty well with the number of licensees 5 that we have out there.

6 The Office of Radiation control is made up of five 7 programs other than the emergency response which ali 8 programs share in. The radioactive materials program, the 9 fees which by law -- some fees within the programs are set 10 by law. The fees in the radioactive materials section 11 though are set by rule, so that we don't have to visit the  ;

12 legislature each time we want to increase the fees. j

()13 Our fee structure has been over the years sort of 14 a sawtooth, if you will. We are plotting the ratio of 15 revenue versus expense, in that we go into a fee increase 16 and we now are well above what it costs us to run our 17 program. The last fee increase, the one prior to the last 18 one, it was a five year frequency between the time we had to 19 increase fees. We increased fees a couple of years ago and 20 probably will have to increase fees however, probably within 21 the next year.

22 Our fees consist of application -- specific 23 license fees consist of the application fees. We have an 24 annual and a reclamation fee, which is due and billed at the 25 time of the anniversary of the license. Reclamation fee is

105 1 five percent tacked on to the cost of the license fee to 2 take care of orphan sources, some contamination that we 3 maybe we don't have someone to fall back on.

4 It's interesting, in the five years that I have 5 been there, we haven't spent a dime out of that fund. We 6 only have something like a quarter of a million dollars

'7 built up which is probably not enough for a major clean up, 8 but it is there. We do have a simple fee system, although 9 we have 33 categories. There is no charge for amendments, 10 there is no charge for inspections, there is no charge for 11 renewal which is on a five year frequency, even though this 12 . renewal is a complete submission just like:a new license 13 each year.

14 We have approximately just over a little over 15 1,100 licenses, specific licenses. These have been growing 16 at the rate of about five percent per year. Determinations 17 might be a good gage of how the economy was going, and in 18 fact probably terminations are up by about 30 percent. We 19 are selling new licenses which is kind of strange.

20 Our medical group is the fastest growing group 21 that we have. It's also our largest single discipline. I 22 don't know whether NRC is going to exempt medical licenses 23 or not, but the private practitioners are the ones that 24 cause us the most trouble as far as enforcement is 25 concerned. As far as being able -- what goes into the O

I i

1 lO 106 .

's_/  !

1 calculation of the budget and the calculation of fees in 2 that we are 100 percent fee supported. All programs except 3 for about ten percent I think are generally funded positions 4 within the office of radiation control.

5 It's based upon workload statistics, staffing 6 standards which are being created, historic basis, and any l 7 actual needs which could change as we go along. That's it.

! 8 MR. BORCHERT FROM NEBRASKA: Ed Bailey.

9 MR. BAILEY OF CALIFORNIA: I have something here l l

10 for Carl, because I don't want him to ever say I didn't give l 11 him anything. Some of you all may know that he went to the 12 University of Pacific, so I thought I would bring him a ]

[x_ 13 little souvenir from there since I went to the asparagus j

14 festival yesterday. I 15 MR. KAMMERER: Let the record show that this is of 16 not cost.

17 (Laughter.]

18 MR. BAILEY OF CALIFORNIA: You will notice that 19 the price marked on the front is three dollars.

20 [ Laughter.]

21 MR. BAILEY OF CALIFORNIA: I was down in Stockton 22 at the asparagus festival Sunday, and the University of 23 Pacific wac handing out that. I thought I would pick that l 24 up for him.

25 There is a little humorous thing -- it's humorous

($)

1 to me -- talking to some of the old timers in California, 2 they said when California proposed funding their radiation 3 control program out of fees, the AEC at that time threatened 4 not to approve their regulations and found them non-5 compatible. So, we have had sort of a complete turnaround.

6 We have basically three programs in rad health 7 that are funded by fees. We have certification program for i

8 technologists and doctors, registration program for the x- j 9 re y equipment, and our radioactive materials program. We I l

lo hase about 55,000 doctors and technologists that we collect 11 from, collect an annual fee from, about 25,000 registrants 12 that we collect an annual fee from and about 2,500 j 13

( radioactive materials licensees that we collect from. All 14 of these are annual fees. I will get into how we collect i 15 them later on, when we get into that portion.

16 All the fees at the present time go into the 17 general fund. We must collect 95 percent of program costs, 18 total program cost. This is total program. This is all the 19 way up through the agencies spittoons that they buy for the 20 new agency head or whatever. We get our fair share.

21 Basically, the materials program is, as far as I know, a 22 unique system of determining cost. It was based on relative 23 hazard or supposed to be based on relative hazard. We 24 charge by the millicurie. As far as I know, we are the only 25 state in the Union that is fortunate enough to do that or a

l h

a i C) i i unfortunate enough, depending on how you look at it.

2 A couple of other programs that are not in rad 3 health, low level waste program has their fees set in law at 4 $250,000.00 a year. The nuclear power plant emergency 5 . response and planning is set in law. They are negotiating 6 now a new law to see what they are going to do for next 7 year. That's handled through the office of emergency 8 services cuts interagency contracts.

9 The radioactive materials are set in regulation, 10 the certification is set in regulation, and the registration 11 programs are actually set in law along with the inspection 12 frequency. We can, however, do an annual adjustment of fees

()13 based on cost of living index established by the Department 14 of Finance. Sometimes that's a real good thing like six, 15 seven or eight percent or last year it was .6 percent. So, 16 it doesn't seem like that would be much but it helps, 17 everything that we can get.

18 The basic problem that we have is one that I think 19 all radiation programs suffer from, and that is you are 20 insignificant in terms of your overall agency's dollar 21 amounts. The Department of Health Services which we are 22 located in is about a $16 billion agency in California. Out 23 of that, we are about $8 million. They could miss us in a 24 quick overview.

25 This year we got going through the budgetary

109 -

}

1 process which we call the BCP process, budget change 2 proposal. We have to justify the number of people we want

) 3 to have and all. We were approved by the legislature 19 new 4 positions. However, the legislature in California does some l

5 strange things. They pass the budget but then there are 6 unallocated reductions that each department must make.

7 For instance, we had a 20 percent reduction that ,

8 was unallocated. You take it wherever you want to. The fee  !

9 programs were not exempt from that. So, it was up to the l 10 agency to decide what they want to do. We gave up those 19 l

l 11 new positions rather than firing people or laying people j

, 12 off. That was 19 on our staff plus the equivalent of three

()13 county people that we would have hired under contract.

14 In addition to that, every year all the agencies 4

15 have a salary saving objective. We now have 40 vacancies.

16 We got permission the week before last to begin to fill l

l 17 those 40 vacancies. What happens if your money is in the i 18 general fund is, when a budget crunch comes along -- I might 19 mention that in California this year has a projected $14 f 20 billion budget deficit -- they switch people to any kind of 21 Federal program that they can. If you are Federally funded l 22 you are good as gold. I have had five license reviewers go

23 to work for the DOE program because shift people to them.

24 Put people in those DOE positions.

i i

25 One of the health physicists from the low level

} j

' l l

1 l

1-j

(:)

l 1 waste program has been transferred to DOE position and

- 1o 1

i  :

2 working on DOE. EPA:is coming in now and funding more and j '3 more and more radiation' positions. We are all familiar with i .

i

j. 4 radon. They are doing NESHAP now.. Those programs, because i i, _ 5 -they have Federal dollars and don't' affect state general '

6 fund, are the ones that people are shifted into whether they j 7 want to be or not. .

1 5 8 We have another law in Cal'ifornia that says we f 9 must reimburse 100 percent counties who want to run their j 10 own radiation program. So, LA county, San Diego County and

. 11 Orange County have opted to have radiation control

{; 12 activities, and we pay those activities 100 percent. Let me 13

( assure you, that includes the council chambers, the board ~of j j 14 supervisors when they redo it, we get our share of that $20 l

15 million or whatever.

l l '16 There are several things that we are doing.

t 17 Reciprocity fees, we just this past year put into effect 18 $400.00, anybody coming in for any kind of reciprocity. We

[  ;

i 19 also took away the exemption for state, county and city.

l

20 facilities, and that will raise us about another one-half 21 million.

1 22 California is faced with several things that i

l 23 really hurt the budget. One is, there is a cap on general j' 24 funding. The general fund cannot expend more than a certain i

i 25 amount. This is by voter referendum. Another thing that  ;

l l

o

J C) 1 happened a few years ago was no tax increases. If you buy a ,

2 house today the purchase price is what you are taxed on. If 3 I am living next door to you and I bought it 30 years ago,

-4 essentially that's what I am taxed on. You have people i 5 literally living side by side and one of them is paying on a 6 $30,000.00 appraised value and the other one is $300,000.00 7 appraised value.

j 8 This system worked real well as long as the l 9 economy was going up. But now the spiral has kind of caught i

10 up and California is about to go down the tubes. They are ,

l 11 taking all the kind of cuts that they can.

12 Another provision that was passed by voter j I referendum was dedicating a fixed percentage of the general

\_)\ 13 I i 14 fund to education. So, when our fees came in, in theory at l 15 least they could have ripped off -- I think it's that 40 16 percent of the general fund -- they could have ripped off 40 17 percent but actually didn't do it. That's a reason to get i 18 to a special fund.

19 In the current legislative session we do have 20 legislation going through now for a special fund, also for 21 administrative penalties and financial provisions. That's 22 about where we are on our program. I might add one thing.

23 The law says that we must collect at least 95 percent. In 24 the five years prior to last year we collected about 25 $800,000.00 more than we spent. Last year we collected

(~h 4 (_)

I

. ~h 112

[Q -

1 about $800,000.00 more than we spent alone. This year, it 2 will probably be in the neighborhood of a million dollars 3 more than we collect than we spent, and nobody has even said 4 thank you.

5 That money just goes in the general fund and gets 6 gobbled up. Are there any questions?

7 MR. BORCHERT FROM NEBRASKA: Thank you, Ed. Tim.

8 MR. WALKER FROM OHIO: I do want to comment that 9 contrary to the statement that was made earlier, we are 10 going to make every effort to not be the sole support of the 11 NRC.

12 [ Laughter.]

MR. WALKER FROM OHIO: In fact, I would like to t

)13 14 than the NRC for their backing, inadvertent as it may be, to 15 our proposed agreement state status. Our governor sent a 16 letter to the Commission indicating interest in agreement 17 state last April, so it was a year ago this month. Then, 18 along that summer came NRC fee increases. At this point in 19 time we have the backing of industry like nobody's business.

20 That's really kind of swung things in our direction. I 21 would like to thank you guys officially, non-officially or 22 however.

23 We are still a registration only state. We have 1

24 aspirations of becoming a licensing state and then moving on 25 to agreement state status. So, we are really in the dark

1 1 ages by comparison to the balance of you folks. In the 2 radioactive materials section, let me address that. Funding 3 sources both from contracts and grants, as was alluded to, )

4 the EPA and an NRC contract and other Federal sources some l 5 general revenue funds and also fees.

6 The fees are shared in common by both x-ray and j l

7 radioactive materials, and although they usually don't throw I 8 things at me, the x-ray people look at us as leaches.

9 Certainly, we don't bring in anywhere near as much money as 10 they do. One problem that we do have, and I understand it's 11 done different elsewhere and I view it as a problem, is that 12 the fees are established by statute. If we do want to modify anything we have to go through legislature and change

)13 14 that. I view that as a real problem and are striving to 15 change that as we modify our rules.

16 The fees as they stand right now, again, are 17 through statute and are historically established. I see no 18 basis in reality for the way the fees are established. In 19 fact, I lose money every time that I sent somebody out to do 20 an inspection. Likewise, our registration costs do not 21 cover what we have to spend to do business. l 22 I hope we can correct these things. I really i I

23 appreciate the opportunity to be here, so that I can benefit l i

24 from your experience and your knowledge. Since I have  !

" 25 something fresh to start with maybe I can take a little bit

- 114 1 of this and a little bit of that and turn it into something 2 and get us headed in the right direction, and minimize our 3 problems. That's about all I have to say.

4 MR. BORCHERT FROM NEBRASKA: Are there any 5 questions for Tim?

6 [No response.]

7 MR. BORCHERT FROM NEBRASKA: William.

8 MR. FLOYD FROM NEW MEXICO: As was mentioned 9 earlier, New Mexico currently does not have a fee schedule 10 for radioactive material licensees or for x-ray registrants, l

11 Back in 1985 we did make an attempt to implement a fee l 1

12 schedule. Again, our primary opposition was from the dental I

()13 board and from the medical profession.

14 I think the fees we were proposing to charge were I 15 extremely reasonable. We were attemptir.<J to collect $15.00 16 for dental x-ray registrants and we met with opposition for 17 that also.

18 Currently, as with most states, we face a budget 19 shortfall, and the governor is attempting to find money 1

20 anywhere possible. I do think that there would be i 21 administrative support for a fee schedule for registrants 1 22 and licensees. Also, I think that most of our licensees 1

23 would probably support a fee schedule because a lot of  !

24 people who move into the state from elsewhere, they expect 25 to pay and find out that we have no fee schedule and can't

115 1 believe it. Also, I have received unsolicited checks from 1

2 reciprocal licensees on occasion but again,-they expect to

)

i 3 pay. I just forward the check and send it back. l 1

4 The-problem in New Mexico is that unless 5 legislatively exempted, all fees go into the general fund.

6~ We do have a-radiologic technology certification-program;in 7 the state, and that is a self-supporting program. But the ,

8 legislature, of course, had to allow us to collect those 9 fees for that fund. This'past legislature an attempt was l l

j

~

10 being made to'take all money in special funds and put it 11 back in a general fund, and that did fail. But I have no 12 way of knowing, like anyone else, what's going to happen in )

()13 the future.

! 14 Frankly, we are not at present all that supportive i

15 of the fee schedule for licensees or registrants unless we 16 can get that money back. Are there any questions?  !

l i 17 [No response.] ]

3 1

} 18 MR. BORCHERT FROM NEBRASKA: Thank you, Bill. I

\

) 19 Bob.

I 2

20 MR. HALLISEY FROM MASSACHUSETTS: Like my 21 predecessors there, we are not yet an agreement state. But

]

22 we are working in that direction, and are presently 23 undergoing creating a fee structure for agreement states. I 24 am certainly taking copious notes'here and learning from the 25 rest of my brethren here.

(~)'

v 116 1 In Massachusetts we have a situation, the 2 radiation control program, in which we have basically four 3 areas in which we have some type of a fee assessment which 4 goes into the general fund. That's in the x-ray area, RT 5 licensing, environmental monitoring and low level waste. We 6 collect our appropriations. We get appropriations to 7 operate the program, but we have also the category called i l

8 the receipt accounts, in which when you collect fees for  ;

9 certain types of activities a portion of that goes into a 10 receipt account, which the program is then able to use to 11 offset the process of collecting the fees in operating, et 12 cetera.

[ D 13 The receipt account is not a total 100 percent I

\-) l 14 recovery of the amount of the receipts you get. When I come 15 over from the Federal government to the state in 1980 to 16 take over for Gerry Parker, the fortunate situation is that 17 there is a number of different statutes that the radiation 18 control program operates under, and all of them the 19 legislature had the foresight to put in the clause to offset 20 program costs reasonable fees can be assessed to users.

21 In 1980 and 1981 when the times were beginning to 22 get rough, the concept of starting to collect fees for I i

23 service in state programs was being pushed by the governor '

24 at that time. So, I had the ability then to establish fees 25 for the x-ray program. Basically, that was the main program l l

l I'h 117 V

1 at that time.

2 In that process then it said that the office of I

3 administration and finance will set the feeu, so I thought 4 that was rather nice that I didn't have to do any 5 calculations. I would'just give them a call and say what 6 are the fees going to be so that I can tell everyone, and 7 they said you didn't quite redd that. You establish the I 8 fees, you determine the cost, et cetera and how much the )

9 fees should be, put the whole package together and send it 10 up here and we will sign our name to it and that's how we 11 set the fees.

12 So, I then took and determined by the amount of l

t 13 personnel that we had at that time and set up a program of I 14 determining x-ray registration fees based upon frequency of 15 inspection, impact upon public health, the number of people l 16 that would be impacted by those particular x-ray units; 17 therefore, the units and hospitals would have a higher 1

18 impact than the general practitioner's office. We had to I 19 build in the salary cost fringes, overhead, administrative 20 costs. We also built in equipment and maintenance and 21 travel costs and averaged them out and came out with 22 different fees for different types of x-ray units by 23 facility, with the lowest one at $15.00 per tube for the 24 dentist who, again, like everyone else, cried the loudest.

25 Those were done in 1981, and I have a surprise for

r'% 118 1 the dentists. In 1992 we are going to revisit them and help 2 pay them back for all their crying.

3 We have basically had to build into it -- I built 4 into it the cost of the inspectors and also the cost of the 5 technice. vork and the regulations development and the 6 overhead, and the support staff, clerical staff for the non-7 compliance and all. We then also in 1987 became a 8 radiological technologist licensing, and developed a similar 9 type of an annual fee system there, nothing related to the 10 cost of inspection. It is simply just for the privilege of 11 having the license.

12 As I said, it does not go into a dedicated fund.

It goes into the general fund, but generally in the early t

)13 14 1980's the programs that had some ability to collect fees 15 were then looked on more favorably at budget time than those 16 that didn't have any.

17 over the last two years they have gone to a new 18 system, in which they now allow you to write in the outside 19 language of the budget, the amount of money that you expect 20 to collect in fees and the portion of that which you would 21 like to see back in the program to operate the program in 22 terms of inspections. It is really looking too good. As I 23 look at the outside language of the budget I have twice as 24 much on the outside language as I have in the general 25 appropriation in the center.

O

l i

1 Even in the outside language of the budget the 2 concept is that you are collecting the fees for services and 3 that money would be used to hire the personnel and maintain 4 them and operate the program. Our fees are not set

! 5 statutorily. At any time we want to change and adjust them l

6 we simply come out with a new regulation and new fee 7 schedule.

t 8 I think probably the last comment that I would 9 make which Gerry made early on and in which Jim just alluded 10 to, in the agreement state activities the affected industry 11 is looking forward to our being able to issue fees at a much 12 lower rate than they are presently paying to the NRC. We

( 13 are capitalizing on that, in terms of getting their support 14 in the fee process.

15 MR. BORCHERT FROM NEBRASKA: Any questions for 16 Bob?

17 (No response.)

18 MR. BORCHERT FROM NEBRASKA: Thank you. Jill.

39 MS. LIPOTI FROM NEW JERSEY: In the last of these 20 workshops we talked about regulation, and we have a 21 Commission on Radiation Detection, a separate body, that 22 sets our regulations to prevent unnecessary exposure to 23 radiation. The department, it gets to set the fees for the 24 services it performs. So, those regs are set out by the 25 Department of Environmental Protection and Energy.

(:)

1 o 2

We have just, in the past two years since we 3

suffered some very significant appropriation cuts -- $1.1 million one year, and the next year an additional 4 $300,000.00 5

the next year and an additional half million .

We have increased all of our fees.

6 7 I brought with me 20 copies of all of the propo sed regs and the adopted regs.

8 The adoption package has our response to comments, 9

and for those of you who might be facing opposition in setting fees, you should read those 10 responses to comments.

11 You can plagiarize them. They 12 really set out pretty much what every dentist says and wha t every opposing group will probably say to you and you can

()13 get ready to respond.

I do not want to carry these 20 copies 14 back.

Please take copies of those.

15 16 We set fees for X-ray at $100.00 a tube. We have 17 20,000 tubes, so that's $2 million right there. We don't spend $2 18 million because there is a hiring freeze and we 19 have not been able to hire the inspectors to perform the services to do it. So, 20 we are going to carry forward a significant amount this year. This 21 is the first year we got carry forward language.

22 In previous years we have been 23 making donations to solid waste and to other programsat the end of the fiscal year.

24 that. I am glad to say that we will stop 25 We set out fees I for radiological technology

~

2

[)

g 121 1 certification, $50.00 every other year. When we get into 2 the collection of these things I definitely want to talk to 3- you about fees that come in every other year.

4 The way that we set the fees is to set out the 5 number of FTE that we need, and we even have to list who it 6 is we are supporting; one bureau chief, three rad phs one's 7 four rad phs two's, list them out down to legal support, j 8 administrative support, receptionist. The whole thing is in 4

9 here. Based on those estimated salaries we add an 4'

10 additional 32 percent for fringe benefits. I don't know 11 what your fringe is, but 30 --

it's right around there.

12 Indirect costs are another about 38 percent right on top of

/3

( y 13 that.

l 14 Then, of course, we have to add in printing and e

15 office, gas and oil for your vehicles, technical equipment, J

16 telephones, postage, data processing, maintenance of a

17 equipment to get calibration, rent building and grounds, I

18 rent central motor pool. Those kinds of things are all set 19 out as a specific amount. If you are doing budget this is 20 real handy to have, particularly for those people who i

21 haven't set fees before. You need this kind of background. '

22 In radioactive materials we are not an agreement 23 state. We charge for our normalized -- we also charge for I

24 source byproduct and special nuclear licenses. It's only 1 25 $100.00 a year. But that is to go for us maintaining a file l

l

I l

i 1 of all those licenses so that we are ready when we get the 2 call, such and such a building is on fire. The fire-

~

3 department wants to know what is stored in that building.

4 Is there any radioactive materials involved. We go and 5 check it out.

6 It's also because we get to stand there out on the

.7 road and try and recover radiopharmaceuticals that bounced 8- out of a truck, and there we are looking for little capsules 9 in the night and the police are directing traffic around us, i 10 and to look for sources that get lost. We do the emergency -

11' response in a lot of cases. The NRC is available-for l 12 consultation by telephone but they are not always on site. l 13 A non-agreement state, we get the call. The-locals.know us,

( -

14 they expect us to be out there. 1 15 We have just responded to a vomit incident, where i

16 a person was given Iodine 131, and on the way home from the l

17 hospital pulled over to the side of the road and threw up.

i 18 We get to respond to that. +

-19 MR. BAILEY OF CALIFORNIA: We always call out the 20 responsible licensee to come and clean it up, and we watch.  ;

21 MS. LIPOTI FROM NEW JERSEY: That's what we did.  !

22 But first, we had to find the patch of ground. We do charge i 23 these NRC licensees for those type of things. We have to l 24 respond. '

25 Calculation of fees, I went into. We do include

([) l4 l  !

l l

1 1  :

1  !

1 -drafting of new regulations in our projections for FTE. We 2 do have a dedicated funds. Dedicated funds means that I can 3 no longer shift resources between program areas. A lot of  !

i l

l 4 you mentioned that your x-ray does support part of your rad j

5. materials program. I could do that, as long as we didn't J

6 have dedicated funds. Now, we have dedicated funds and I l

fi 7- can't shift anything. I am audited every year and can't do j 8 that. That is a difficulty that I see facing us.

9 On the other hand, it also means that 5 don't make i 10 these donations to the Air program or solid waste program or i

! 11 whatever. There is good and bad with those kind of 4

2 12 dedicated funds.

4 We do have a small appropriation besides fees, and

( ) 13-l 14 that goes to support our contaminated sites program and some i

i 15 parts of the laboratory, because we don't have fee funding

! 16 -for those kinds of operations. Our collection rate is 99.9 i 17 percent. We have a very good collection staff. They hound 18 these doctors and dentists until they pay.

19 They even put them on a collection schedule if

!' 20 they say we can't pay this whole $100.00 all at once, it's l 1  :

i 21 just too much. Well, we will take $20.00 a week. We do get  ;

l 22 the money. Our most vocal group was the dentists, and we do )

! 23 charge exactly the same fee for dentist per tube as for

24 hospital. We have a justification for that.

s j 25 When we do an x-ray tube inspection it takes much s

i l

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

124 1 more time for scheduling a dentist and rescheduling because 2 the dentists cancel at a much higher rate than a hospital.

3 It takes one phone call to schedule a hospital and we can do 4 ten tubes in that inspection or more. But each dentist 5 takes travel time to the dentist. We can only schedule 6 about five tubes per day for dentist inspection, four to 7 five. We can go to maybe seven tubes a day at a hospital.

8 MR. GODWIN FROM ALABAMA: Why do you schedule?

9 MS. LIPOTI FROM NEW JERSEY: We do schedule our 10 inspections so that they don't have a patient schedule at 11 the time we are inspecting. We do schedule. That's an 12 interesting point. Another reason that we schedule is to

( 13 maximize the time that our inspectors spend in the field.

14 We have clerical that do the scheduling, and the inspectors 15 are out in the field four days a week. They only come in 16 one day a week. They are handed their schedule by the 17 secretary and told to go there.

18 We documented that we spend 30 minutes per phone 19 call on the average with dentists, explaining our regs 20 versus ten minutes per phone call on average explaining to 21 everyone else. We documented that. They have more 22 violations per inspection than anybody else. We have 23 documented that, so we have more reinspections. If you need 24 any of that to put in your referrals from dentists I would 25 be glad to give you that.

(

l

i, 4

() 1 I don't have a breakdown on how many dentists per 125 2 x-ray tube. There are 20,000 x-ray tubes and that's an l 3 awful lot in New Jersey. We have 760 NRC licensees and 240 1

4 norm licensees. We'have about'16,000 radiologic l 5 technologists.  !

L 6 The only other group that we charge fees to is for 7 radon certification. If anybody is interested in those ,

1 8 kinds of fees, I would be glad to talk to you about that. I i I '

9 didn't think that.was generally applicable. R 10 MS. ROBINSON FROM. RHODE ISLAND: Jill, who does i l

11 your collection? You said.that you have people that handle l

12 those? i MS. LIPOTI FROM NEW JERSEY: Yes. We have two

( ) 13 14 aud'.t account clerks that do the follow up for people who

15. don't pay, but the money actually comes into a separate 16 bureau of revenue. 'That's a computerized collection system, 17 and I-will talk about that in the computer part.

18 MR. BORCHERT FROM NEBRASKA: Any questions for 19 Jill?

20 [No response.)

21; MR. BORCHERT FROM NEBRASKA: You said that you 22 have copies of information to hand out.

23 MS. LIPOTI FROM NEW JERSEY: Yes.

24 MR. BORCHERT FROM NEBRASKA: At this time, I am 25 going to turn it back to Gerry Parker.

l i

l

I f

l l

l 1 MR. PARKER: Thank you very much. It's been a

! 2 very, very productive session this morning. We have reached l

l 3 12:15. We are going to take the lunch break now, and 4 continue on with Session I right after the lunch. Jared you 5 will be first, and then Aubrey.

6 Then, we will go to Section II. Dick has copies of )

7 the places to eat around here, and they will be at the back l

i 8 of the room. I have a number of things that I would like to '

9 clear up. Hal, you and Jill mentioned that you have carry l 10 over language for your money, so that you can carry it over?

l 11 MR. BOHLINGER FROM LOUISIANA: We have a dedicated l 12 portion of the --

MR. PARKER: Could you supply me with those, so (A}13 14 that we can put that in the report. People that want to get 15 that into their budget will be able to do that.

16 MR. BOHLINGER FROM LOUISIANA: I will be glad to.

17 MR. PARKER: Terry, would you either send me 18 copies of your slides or leave them and we will make copies I

19 before you leave? l 20 MR. FRAZEE FROM WASHINGTON: Yes. ,

I 21 MR. PARKER: For planning purposes for tomorrow's 22 session, I understand the earliest departures are that 23 people have flights at 1:45; is that correct? Does anybody 24 have a flight before 1:45?

25 MR. FUENTE FROM MISSISSIPPI: I can catch one at O

O 127 V

1 1:30.

2 MR. PARKER: You would say that. That's why they 3 call you fast Eddie. Somebody did tell me yesterday and I 4 can't remember who, they said they had a 1:45 flight.

5 What we will try and do then to accommodate -- I 6 want everybody to be here for tomorrow -- would 8:00 o' clock 7 be too early for all you folks to start tomorrow morning?

8 Mary, can you make arrangements to have somebody here at 9 8:00 o' clock tomorrow. We will start tomorrow at 8:00 10 o' clock.

11 Why don't we take a break now and be back here at 12 1:30.

t 13 [Whereupon, at 12:17 p.m., the meeting recessed, 14 to reconvene at 1:30 p.m., this same day.]

15 16 17 18 19 20 21 22 23 24 25 O

O .1 AFTERNOON SESSION [1:30 p.m.]

128 2 MR. BORCHERT'FROM NEBRASKA: We will begin with ,

3 Arkansas.- ,

4 MR. THOMPSON FROM ARKANSAS: In 19C'/ the 5 legislature passed a statute authorizing the Health 6 Department to establish and adopt annual fees for ,

7 radioactive material licensees and X-ray registrants. So  !

8 our. annual. fees are by legislative statute.

9- They also-established that:this money would go

'10 into general funds. That way they get to appropriate l

11 however they want to. We don't get-to see it or keep it in 12 any particular form or fashion. So we are not a self-supporting program.

( ) 13 14 As far as our budget is concerned, we are kind of 15 at the mercy of the legislature. Our budget is based upon .

-1 16 our FTEs and some overhead costs. Our RAM licensee annual l

17 fee cost recovery is approximately 13 percent. That's about 18 all I have. I I

19 MR. BORCHERT FROM NEBRASKA: Any questions?

20 [No response.)

21 MR. BORCHERT FROM NEBRASKA: Aubrey.

22 MR. GODWIN FROM ALABAMA: I passed out some of 23 Alabama's laws that are pertinent to this.

24 First of all, to continue Eddie's story, I sat 25 'down and after careful and deliberate consideration and O

/

1

/9 129 i

(_/ i i devious calculations determined the appropriate fee schedule 2- that I put in our fee bill and then shared it with Eddie 3 after our advisory board had recommended that the bill be 4 introduced. I fully appreciate the story. j 5 You need to understand that the Board of Health in  !

6 Alabama is the 4,000 doctors that are members of the medical 7 association, and the executive committee for that  !

l

8 association is the Board of Censors.

i 4

9 The Committee of Public Health, which serves in l l

10 the stead of the State Board of Health, turns out to be the 11 State Board of Censors also. So at eight o' clock one 12 morning the State Board of Censors voted on the

^

l 13 recommendation of the Advisory Board to get the bill l

14 sponsored and put in the legislation. Subsequently it was

.I

15 found to have some problems and so many professions were 16 opposed to it and it died a rather natural death right after 17 that.

4 18 So we were stuck without any fee legislation, j 19 while Eddie, taking my bill, was successful in getting it 20 through his legislature.

21 The bill was reintroduced on several different l 22 occasions but it died every time and we finally gave up on

, 23 that approach until the low level waste business started up 24 back in the 1980s. If you look at page 865, you see the

! 25 section that is pertinent to the low level waste compact

(~h

. \_)

J

(_)s .

1 legislation that affected our law and our fee system.

2 Specifically, the Southeast Compact requires a l 3 program to be equally capable of enforcement as the federal 4 program. The only way that that could be assured is to some 5 way have some sort of reasonable financial assurance with 6 it. Discussing with the legislative leadership and various '

7 others about how to do that in Alabama, I proposed that 8 there be created a radiation safety fund, which is a 9 technique we use in Alabama for earmarking. That was in the i

10 first sentence. '

11 The second sentence indicates how we are to 12 collect the money for that fund, namely, 75 percent of the fees that are charged by NRC.

f~ )D 13 14 When you hit the third sentence, it gives one 15 little limit to it, namely, it has to be for specific  !

16 licenses, because they didn't run afoul of anybody claiming 17 we were double taxing.

18 The fourth sentence appropriates the money to the 19 Health Department, which is where my agency is located, for 20 the specific purposes of the Radiation Control Act. It 21 doesn't limit it to any part of the Radiation Control Act.

22 It further provides that the money can be carried 23 over up to $100,000 from one year to the next. And that 24 turned out to be pretty decent legislation.

25 Thirty days after the legislation was passed O

1 unanimously by both houses of the legislature and signed 2 within three days by the governor we notified all of.our l 3 licensees that they were going to start paying licensing and l 4 amendment and inspection fees and proceed to collect them

5 based upon 75 percent of the federal fees.

1 F 6 It has nothing to do with program costs. That's l

l .7 the first thing you need to recognize. It was strictly 75 8 percent of the federal fees. It's politically good'in that 9 you are always cheaper than the Feds. People do not want to 10 take the program back to the Feds. And when they change the 11 fees, you can always blames the Feds. There are a lot of i 12 good things about it.

13 'There are some bad things. You are stuck strictly j 14 with the analyses performed by NRC. Early on in the 15 assessment business the NRC was really quite cheap compared il 16 to total program cost.

17 Second, it doesn't cover NAR or NOR. Nor does it 18 ' cover x-ray. Which is probably the reason why it went 19 through unanimously. All the radioactive material folks 20 understood waste problems and the x-ray folks didn't.

21 We continued to go our merry way collecting this 22 money until the spring of 1991 when NRC announced, as a 23 result of the congressional mandate, that they were going to 24 annual fees and would do a 100 percent cost recovery. The 25 bottom line result is that with 400 licensees now we are O

i 1 collecting $850,000. That pays the materials program and 2 the x-ray program, environmental monitoring, and just a bit 3 on. emergency response planning.

4 Yes, sir.

5 MR. BAILEY FROM CALIFORNIA: Your materials 6 program is paying for your x-ray program?

7 MR. GODWIN FROM ALABAMA: Yes, sir. When the NRC 8 put their rules into effect, the first thing the department ,

9 did was remove all state funds from our program. That has 10 turned out to be a minor advantage.

11 MR. BAILEY FROM CALIFORNIA: Did the dentists 12 object?

13

( MR. GODWIN FROM ALABAMA: The dentists weren't 14 paying anything to begin with; the dentists still aren't I l

15 paying anything.

16 I might add, there was a political problem in 17 trying to pass the original bill. The dentists concluded 18 that they could get inspections done cheaper than we could 19 do it at $25.00 an inspection, and they were going to go out 20 and create their own inspection program and remove all that 21 authority from our program. That was their approach to 22 that.

23' The Health Department in Alabama, as in most j 1

24 states, I guess, is in somewhat dite financial straits. We  !

25 are in the process of downsizing.

- - . - - ... -.. . . - ~.- -. . ~... -- - - =- -.- ..-.- - . ---

4 133 1 MR. NASH.FROM FLORIDA: Governor Chiles says right 2 sizing.

3 MR. GODWIN FROM ALABAMA: They started on layoffs.

4 Although the final answer is not in, at the present time it i

! 5 appears that we probably are not going to lose anybody, but 6 I can't say~for sure. We may and up losing a couple of 7 people anyway. The reason for that is the positions that 8 are covered in my division are all funded out of this l

l 9 radiation safety fund,.which is specific to that and was not 10 subject to the proration that the governor put into the

) 11 general fund. That's the good part.

12 Several of you talked about administrative costs <

1 13 and things being charged to it. The way this particular law 14 is phrased there is the ability of the department to charge 15 administrative costs to the fund. They pay for the lights 16 and the water-and all that. So that sort of makes sense. i 17 After some deliberation, the department has 18 decided to go with the cost that has been assigned by the 19 federal government for all federal contracts. In our case 1

20 that's an assignment out of the HHS regional office. That 21 particular provision is the 19.8 percent for our agency. So 22 no matter how much money I had left, they are going to take 23 19.8 percent.

24 They really can't go beyond that because there are

25. provisions in the federal regulations that say that the O

' 1 indirect cost rate and the way that they account for that i

2 indirect cost rate for administrative charges has to be used 3 for all funds that are handled by the unit in question.

4 That does provide some help to you when there is a question

. 5 about them taking a greater percentage. You might want to 6 stick that in the old memory banks.

7 That's really about all I've got. I'll get into 8 the collection and enforcement and things like that in the 9 next session.

10 Do you have have some questions?

11 MR. HILL FROM GEORGIA: Aubrey, what are you going q 12 to do when there are no agreement states and the Feds have j

13 no material licensees?

i 14 MR. GODWIN FROM ALABAMA: I will be fine. If 15 there is no fee system set up at the federal level, it won't 16 work. However, I do anticipate that not all states, 17 territories and federal entities will be wrapped up into it.

18 In the next session I will talk about how you collect from l

i j 19 state agencies.

20 Further questions?

1 l 21 MR. O'DOWD FROM NEW HAMPSHIRE: Aubrey, how many 22 licensees do you have in Alabama?

23 MR. GODWIN FROM ALABAMA: We have 405 currently.

! 24 We had 467 at the start of this on 1 October 1991. We have 25 added about 15 or 20 new licenses, and the difference 1

1 4

I

("'\

135 1 between the 467 and what we got plus the 15 is what we lost.

2 MR. PARIS FROM OREGON: Aubrey, was there much I 3 debate on fees being used for other purposes than what they 4 were designated for, like x-ray? On the other side of the 5 table, we have had problems of x-ray fees being used for 6 material. Is there the reciprocal of that?

7 MR. GODWIN FROM ALABAMA: We're just getting

.8 equal. Are you talking about legislative debate?

9 MR. PARIS FROM OREGON: No.

10 MR. GODWIN FROM ALABAMA: Departmental debate?

11 MR. PARIS FROM OREGON: Licensee debate. Anger.

12 Their fees being paid for the x-ray program.

()13 MR. GODWIN FROM ALABAMA: The licensees are not 14 happy about it but they also recognize that it is still 25 15 percent cheaper than the federal program. When you go to a 16 legislator, he looks at you and says, what are you 17 complaining about? They can't get anywhere politically on 18 it. If'you take it away from us and we lose the agreement  !

19 program, you're going to pay 100 percent to support research l 20 that they ain't real thrilled about either.

21 Sorry about that, Feds.

22 MR. BAILEY FROM CALIFORNIA: Aubrey, did you say 1

23 that you do not regulate dentists or that you do?

24 MR. GODWIN FROM ALABAMA: We do regulate them. We 25 just don't charge them any fees.

O V

i l

, r~- ,

l 1 MR. BAILEY FROM CALIFORNIA: Do you inspect them?  ;

I l

2 MR. GODWIN FROM ALABAMA

Yes, unannounced.

3 MR. BAILEY FROM CALIFORNIA: How often do you 4 inspect them? l l i l 5 MR. GODWIN FROM ALABAMA: We should be inspecting l l

6 them about every five years. We have a few that aren't that 1

7 often, like 30 percent.

8 MR. BAILEY FROM CALIFORNIA: Say that again.

9 MR. GODWIN FROM ALABAMA: We're 30 percent overdue 10 on some of our inspections in x-ray.

I 11 MR. HALLISEl FROM MASSACHUSETTS: Aubrey, how much 12 of the $850,000 does your program budget expend?

l 13

( MR. GODWIN FROM ALABAMA: My actual budget is 14 $900,000. The reason it's $900,000 is because I carried

15 over $100,000 from last year. 'All of that goes to the I

16 program budget. I'm probably going to carry over about i

j 17 $30,000 to $50,000 into next year. All of it is i 18 appropriated to the agency.

19 One quirk about Alabama law is you have to get 20 your appropriation run through every year so you know what j 21 your budget is. That means that October of this year I will 22 be projecting the spending amounts for the year ending in 23 1994. That means I've got to know how much the fee 24 increases will be and guess about how much it will be and 1

25 make sure I appropriate the right amount. I've got to hit

CE)

a 4

d

!() 1 within about 10 percent.

2 7

} 2 MR. BORCHERT FROM NEBRASKA: Any other questions i 3 for Aubrey?

5

4 [No response.] 4 5 MR. BORCHERT FROM NEBRASKA

It is interesting

6 sitting here listening to the variety of different ways that i

[,

7 we all do things in our own states. I'm think we were 8 pretty fortunate maybe in setting up our program in 1987

] 9 -when I wrote into the statute that the fees go specifically

] 10 to the Department of Health cash fund to be spent only for

11 the radiation control program.

12 We also snuck another little line in there, that

()13 the legislature shall not cut our general fund l

. 14 appropriation, and it sailed right on through. Which is

) 15 pretty interesting, because now whenever we are in'a tight i 16 budget thing the first thing that gets cut is general fund 17 appropriation, and I go back and say, you can't touch it; I

18 you already said you wouldn't touch it. And they say, yeah,

! 19 you're right; we said we wouldn't touch it. And they don't

)

20 touch it.

! 21 Our cash fund goes into the program and we carry 22 it over from one year to the next if we don't spend it. It 23 doesn't go back into the appropriation cycle. It goes into i

24 the budget process but not into the appropriation cycle.

I 25 MR. BAILEY FROM CALIFORNIA: What's the 1

I J

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i j

1 difference?

a 2 2 MR. BORCHERT FROM NEBRASKA: In other words, the 3 legislature doesn't have to appropriate those dollars. It's 4 already preordained that it goes into the program and the l

5 program spends it.

~

6 MR. GODWIN FROM ALABAMA: The appropriation goes 7 forward as well as the cash.

8 MR. BORCHERT FROM NEBRASKA: .Yes. The 9 appropriation goes forward as well as the cash. In other 3

10 words, if it was to be appropriated, our appropriations 11 committee would have to vote on whether or not you can spend 12 that cash and whether or not you are going to have that cash

()13 available to spend.

14 What they do is give us a cash ceiling. I have a 15 cash ceiling in the program. I can spend up to that without 16 going back and getting their authority. That's the only 17 thing we have to raise whenever we approach that from a 18 spending standpoint. It has been pretty easy to get that 19 raised. It has not been a difficult situation. In other 20 words, if I generate $10.00, I can spend $10.00 in the 21 program and I don't have to wait for the legislature to 22 appropriate on a line item budget cycle.

23 MR. FRAZEE FROM WASHINGTON: Has there been a move 24 by legislators to go back and undue that legislation?

25 MR. BORCHERT FROM NEBRASKA: We heard some O

1 l

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

1 rumblings a while back, but I don't think that is going to 2~ happen, because there haven't been any complaints from'any 3 of the. regulated industry.

4 'MR. GODWIN FROM ALABAMA: Sometimes, though, that 5 comes from within the department.

6 MR. BORCHERT FROM NEBRASKA: The-department is not 7 looking to do that sort of thing.

8 MR. BAILEY FROM CALIFORNIA: I'd just like to 9 know, maybe just by a show of hands, how many states have a 10 different process for authorized people than they do for the 11 budget process. You are authorized ten people. You may be 12 funded for 20 but then you have got to have hiring

()13 authority, which is totally separate.

14 Everybody that is totally separate.

15 [Show of hands.]

16 MR. BORCHERT FROM NEBRASKA: Does anybody else 17 have any other questions or comments for item No. 17 18 [No response.]

19 MR. BORCHERT FROM NEBRASKA: With that, I will 20 turn it over to Aubrey Godwin. He'll take over from here.

21 MR. GODWIN FROM ALABAMA: We will now to go 22 question two and three together. That is probably the best 23 way to take them, to make sure we cover all the problems and 24 who collects fees. Most of you mentioned something about 25 it, but I think it would be good to go ahead and touch on O

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l.

140 1- them again to make sure we clearly understand how each group 2 collects-the money that has a fee system.

3 Starting'with Alabama, the fees for the licenses,  !

4 ~ inspection fees, application fees of all types, there is a 5 very simple way to collect it. When the application comes 6 in, if it has money with it, we process it. If it doesn't 7 have money with it, we don't process it.

8 our finance group early on had a philosophy. When I 9 they send a check, no matter -what it is for, cash it. If 10 it's too much, we'll send the money back. We can take two 11 or three months to do that. But we'll take the money first 12 and then we'll talk about paying back.

'()13 The first thing that we'did after we saw we were 14 going to actually get the legislation through is meet with 15 the State Examiners of Public Accounts. We-worked out a 16 system with them on how to process the collection of the 17 money. We collect all the money in our division. We handle 18 all the billing. It turns out that in Alabama they bonded 19 all employees for $1 million so there was not a problem of 20 having to find somebody that was bonded. They got a big 21 blanket bond for everybody.

]

22 We have two secretaries handle it, so you have 23 sort of an independent review of all incoming checks. They 24 are taken each day from our area immediately into the l

25 finance area. They are restrictively endorsed. All these O

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l I

l

() 1 things mean a lot to your accountants when you start getting 141 2 audited. The first thing the accountants want done to a ,

i 3 check is to have it restrictively endorsed, which means I 4 nobody but the department can cash it. We take it and get j 5 it immediately into the system. Every day we file a report 6 of how much we have collected and we never have to worry I

7 about it after that.

8 We have been audited three times and never had a 9 problem.

l 10 The problem we have with inspections is you have 11 to invoice those.- The law provides that 45 days after we i 12 invoice someone we must issue a suspension order. They have already been given due process. They have 45 days to

( ) 13 14 appeal. Then any time after that we can go out and take the 15 source and shield it. I assure you we haven't-gone out and 16 taken any source and shielded it. The license is only 17 suspended; it is not revoked. Which helps you when your 18 annual fees come up also. They still have a license that is 19 valid and they still have to pay the annual fee even though 20 we suspended it.

21 Regarding inspections and all the other fees, we 22 had no one not pay.

23 Regarding annual fees, out of the 400, I think 24 there are about ten that we referred to the attorney general

! 25 for collection.

i i

i l'

( 142

ll Some of them were shocked when they got the order t-l- 2 and discovered they hadn't paid and this kind of stuff, but 3- they all came up except for those ten. We have a few more j 4 that are-still pending, but in due time I suspect they will

5 come through. The total of non-pays would not exceed 20, j 6 which is a pretty good rate, about 95. percent. collected.

7 The invoices for inspection are just handwritten 4

8 invoices. It's done as a part of the compliance and report j 9 writing and a part of the letter writing that goes with it,

j. 10 and invoices-are generated as a part of that system.

j 11 The invoices for annual fees is set up on a dBASE j 12 form that we run the list of licenses through. We have got

{( ) 13 them coded so that the ones that have an NRC license code it i 14 prints out the appropriate fee, and you're in business. We i .I 15 simply put on the form itself the date we want, put the copy '

l- 16 number on it, and run it, and it comes out real well. With l 17 a laser printer we can print 400 invoices in less than two

)

l 18 hours, just with a simple PC and a laser printer. Once you

19 get it going you don't even have to look back. Just keep 20 adding paper to it. That's all you have to do.

.21 It seems to work rather well. The money came in.

22 Five thousand dollars was the latest one we got. It's 23 coming on in. We have gotten in $830,000. As you see, it j-j- 24 comes in well.

i 25 The problems that we have encountered:

T

4 b

\~Y 143 l

1 In a few cases we improperly coded things. Those 2 things happen.

s 3 The small entity fee system of the NRC. When you l 4 mail the bills out, you really don't know whether the person j 5 you are mailing it to qualifies as a small entity. So you

) 6 have to wait until they mail the fee back with the 7 appropriate form and then see if it's right. We have no 8 real means to determine the accuracy of the information on 9 the NRC form, i.e., that they earned less than $3.5 million.

4 i l 10 That is just sort of one of those open-ended things. I I i 11 don't know how we would answer that on an audit question if I 12 they ask us how we do it, because we don't have any way to

( ) 13 do it.

14 Every time they audit us the auditors make one 1

15 general comment. Apparently most programs that issue 16 licenses receive a fee. Most of the fees are one value, 17 i.e., $15.00 or $100.00 for whatever it is, and you can l 1 l 18 count up the number of licenses issued and count the amount 19 of fees and you can balance out instantly. Every one of i

20 ours is different. They have to go through by hand and 21 actually do some accounting work.

22 They also have learned that just because a fee is 23 paid we don't have to issue a license, and that generates 24 some questions, because most of the time they want to 25 compare receipts with licenses issued, and it makes no O

O

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i 1

I i -

l [ 144 1 difference.

2 Like I said, after they get through it, we have

! 3 been able to come out clean.

4 Questions.

5 MR. FUENTE FROM MISSISSIPPI: Aubrey, the 45 days, 6, is that in your legislation?

7 MR. GODWIN FROM ALABAMA: That's in the 8 legislation. Specifically 45 days to issue a suspension 9 order. The legislation also says if we seize a source, the 10 licensee is responsible for paying all the costs associated 11 with seizing it and storage and all that kind of stuff 12 before we have to return it, and then after one year title 13 transfers to us. So we could conceivably sell it.

( I don't 14 know what we would do with some of these sources. That's 15 why we don't want to take them. We have not gone for 16 sources.

17 MR. FUENTE FROM MISSISSIPPI: You don't send out a 18 second and third notice?

19 MR. GODWIN FROM ALABAMA: Usually at about 40 days 20 we go through it and those that are left we send out 21 something just to remind them. Somewhere between the 45th 22 and the 50th day we try to issue an order suspending it.

23 Whether it's an inspection fee or an annual fee doesn't 24 matter.

25 By putting that into the law we avoided having to 1 \

l

(~'/

s_

.. . - . = . . . . - . . - - - - _..- -. - . . - . - - - - . . - -. . - . . . -

4 j 1 do all the due process stuff where normally you issue an l i 2 order; then you have got to have hearings and all these kind l

3' of things. When they get the bill'they go on notice then.

, 4 They have got 45 days to appeal. If they don't appeal, 5 time's up. It starts automatic actions. If they appeal in l

j 6 that 45 days, you can't do that. You have to go through the 7 hearing process. But if they don't appeal in the 45 days, j 8' everything else is automatic. )

i 9 MR. FRAZEE FROM WASHINGTON: It sounds like you're l l

l 5 10 doing the once a year hit all the annual fees. '

$ 11- MR. GODWIN FROM ALABAMA: Yes, sir.

i 12 MR. FRAZEE FROM WASHINGTON: It sounds like it's a

()13 pretty quick process for you. You don't have a lot of

14 expended manhours doing that?

15 MR. GODWIN FROM ALABAMA: Probably a couple i

16 hundred hours for the whole billing process over the year.

l

{ 17 The reason we do it that way is because that is the way NRC i

18 did it, and we are doing 75 percent of whatever NRC does.

, 19 Incidentally, if you go this route, you need to

' 20 understand all the interpretative things that NRC does, 4

21 about how they bill. We made a mistake and had to return l 22 some money in a couple of cases.

4 23 MR. BAILEY FROM CALIFORNIA: Do you also grant the

24 same exemptions?

1 l 25 MR. GODWIN FROM ALABAMA: Yes, sir.

4 1

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)

i 146 1 MR. BAILEY FROM CALIFORNIA: And you have how many 2 total licenses that you bill?

3 MR. GODWIN FROM ALABAMA: That would be about 348

-4 or 350. About 50 of them we don't bill, roughly. I didn't 5 run that.

6 MR. BAILEY FROM CALIFORNIA: About 350 you bill in  !

7 one day?

8 MR. GODWIN FROM ALABAMA: Yes. I do it the easy 9 way. I take my little dBASE program and I run all the bills 10 two weeks before I mail them out. I get everything set up 11 and the day that is listed on the bill I send it out. I'm 12 lazy.

()13 MR. FUENTE FROM MISSISSIPPI: Do you use a 14 standardized billing form? When I say standards, I mean  ;

l 15 like three portions, three parts, or something like that. I 16 MR. GODWIN FROM ALABAMA: We run all our bills on 17 a four-part basis. The original goes to the licensee with a 18 duplicate. So he get's the original and the first copy.

19 The second copy goes into their file and the third copy goes 20 into a chronological file, a numbered file, so that you can 21 tell if somebody'tried to mess up one of them. When he 22 sends his bill back he is supposed to send one copy with it.

23 Typically they don't, but we don't worry about that. We 24 mark paid on the copy that is in his file and paid on the 25 copy that is in the chronological file.

i 1

[v ') 147 1 MR. FUENTE FROM MISSISSIPPI: Somewhere on this 2 form do you identify the fiscal year that you are billing?

3 MR. GODWIN FROM ALABAMA: Yes. They are all 4 numbered. The computer generates the numbers on one set of 5 them for us, but they are all numbered so we can track it.

6 MS. JACKSON: We found with our annual fee billing 7 that by the time we get around to the show cause process for 8 those who have not paid that many of those licensees have 9 turned in their licenses between the billing time and the 10 time that we issue that notice. Have you had that problem, 11 and if so, what do you do in that case when it's a debt but 12 you do not have a license that you can take action against?

(O

\_)

< 13 MR. GODWIN FROM ALABAMA: Like you, we let that 14 date slip when it became important, on up to January, 15 because we saw the little note you all put out to let that 16 happen. You put out a little administrative notice 17 internally. So we let it slide until January. As a result, 18 everyone who terminated before they paid the bill, we had 19 the billing copy that we retained in the chronological file.

20 We simply mark it terminated across it and pull them from 21 further billing action. In order to keep up with it on the 22 computer, I generate a file for billing purposes and pull 23 them off of that.

24 MS. JACKSON: Do you have a debt collection 25 mechanism? Do you turn it over to a debt collection agency i [V\

l

i l

1 i

1

.1 or anything further? 1 5

2 MR. GODWIN FROM ALABAMA: After we issue the order 3 to suspend we usually give them 30 days or so after that to l

4 see if anything is going to happen from that. Then we just l

5 turn it over to the attorney general with a recommendation 6 whether we think he ought to go for it.

7 We had one guy who went to Washington, for  !

8 example. It was $1,125 portable gauge. I guess it was. We

9 recommended forget it; don't collect it. It's just not i

10 worth trying to collect that one.

'i 11 MR. FRAZEE FROM WASHINGTON: Who was that? Who i

12 isn't going to pay my fee?

i i

-( 13 (Laughter.]

14 MR. BAILEY FROM CALIFORNIA

On that point, I j

15 think a lot of us put in our licensing files when the bill i

16 is due. People can tell by the licensing file when it's 17 due. If it's not shown paid, you don't do licensing actions

18 whether they are a termination or amendments or whatever 19 unless that fee question is settled. There is no reason to i 20 do free work for them.

] 21 MR. GODWIN FROM ALABAMA: That's true. An example 22 of that. The State Department of Forensic Sciences has a 23 gas chromatograph. They paid the application fee; they paid i

24 an amendment fee; they even paid the inspection fee; but I l

25 they refused to pay the annual fee. They claimed they )

4 I

l 1 didn't.have enough money. We referred it to the Board of 2 Adjustment for the state. One agency suing another goes to 3 the Board of Adjustment. In the meantime, they came in for i

4 another, amendment. We simply-credited the amendment fee 5 against the annual fee and refused to process it.

6 MS. JACKSON: That's how we handle it.

7- MR. GODWIN FROM ALABAMA: We're money grubbers.

8 Cash the check. That was the main thing they said. Cash 9 the check. ,

10 MR. BORCHERT FROM NEBRASKA: You're done?

11 MR. GODWIN FROM ALABAMA: Yes.

12 MR. BORCHERT FROM NEBRASKA: Our invoices are 13 generated with a dBASE program off the computer system. We 14 split ours up into a 10-month cycle. We.do 10 percent a 15 month. That's because we set up our billing process for 16 everything within the radiation control program on a 17 10-month cycle. We give everybody December and January 18 because nobody likes to get a bill in December and in 19 January everybody is recovering from the holidays. So those 20 .two months are free for you to clean up whatever hasn't been 21 taken care of during the course of the year.

22 We have one person that takes care of all the 23 billing cycle for us for everything, for the x-ray program,  !

24 radiologic technologists, and the radioactive materials.

25 That person has got the system set up oo that the computer O

. . ~ . _. _ _ _ _ _ _ . _ _ _ . . _ _ . . . _ .

1

-1 generates it. They go out about 60 days prior to their due 2 date with 30 days allowed to be paid. After 30 days past 3 the due date, then a second notice is sent out, and if they 4 don't respond within that, then a third notice is sent out 5 along with a letter going to the agency counsel.

6 As soon es it goes to agency counsel, I think we 7 have had most oeople come forward and pay their fees. I can 8 recall only one letter from the agency counsel to a

! 9 registrant, and they paid.

8 10 I'm not sure what the status is this year. We've

11 gotten several letters from folks saying, I paid that last l

12 year and I'm not going to pay it again. So we have to point

(}13 out to them it's an annual fee type of thing.

14 When the money comes in it goes to the cashier i

15 part of our agency. They receipt it and send us a copy of

16 the invoice with the receipt so we know when it's paid and 17 when it's receipted in. We also get a copy from our

18 accounting of a log sheet that they record in the amount of 19 dollars that have been taken into our program on a monthly j 20 basis, so we can match those up that way.

21 We do not issue license or amendments until the 22 fees are paid. The fees on the licensees are based on their 7

23 expiration date. If it expires in the month of May, that is 24 the day that their fee is due; if it's June, et cetera. We 25 do not take any licensing action until the annual fee is

, ~h (V

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i  !

t

, 1 paid. We don't charge an amendment fee; we do not charge an l 2 inspection fee. That's all integrated into one annualized 3 fee.

l 4 We are responsible for it. The person that.does 4

i 5 the billing has had very good success just calling up 6 licensees and registrants and getting them to pay the bill, 7 explaining to them what needs to be done, and they have been 8 very, very cooperative. We have not had to terminate

{

9 anybody. We have had to call some people up and say, we're

{

{

10 not going to proceed with your license request until you pay

{

11 X number of dollars, and lo and behold, the check comes in t

12 real quick. So it seems to be working fairly well so far.

13 Any questions?

14 [No response.]

S 15 MR. GODWIN FROM ALABAMA: Shelly.

16 MS. ROBINSON FROM RHODE IS LAND : It is our 17 responsibility to collect the fees in the Division of E

l 18 Occupational and Radiological Health. What we don't do is a

19 the billing. We don't generate invoices. That is done by

20 an outside firm for the entire Health Department, not only 21 Occupational and Radiological Health, but Professional 22 Regulation and Facilities Regulation.

23 Right now we are in the process of changing that 1

j 24 to an in-house system because it isn't cost-effective and it

25 isn't efficient. They print us things we can't use. When 4

,O

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/ 152 V

1 we have mistakes or problems, they are not very eager to 2 help us, especially for the x-ray registrants. It is very i

3 difficult to get them to reprint something that we need to i

4 send out.

5 I am really interested in your dBASE and your 6 computer, because that is what we are working on. We've 7 ordered our printer and we are in the process of doing that 8 in house.

9 What happens now is they generate the invoices.

10 They are sent out. Once the money is received it comes into 11 the financial part of the Health Department where it is 12 logged in, recorded and receipts are sent on to Division of Occupational and Radiological Health where we also keep a

( )13 14 log and log it into our computer so that we can check the 15 records and we can generate where we are, what is owed to 16 us, and the status of all the registrants. We don't issue a 17 license unless the fee is paid.

18 I think the in-house system will help us get a 19 better handle on things. Right now it is difficult. We do 20 have an efficiency problem having someone else do it for us.

21 That's the biggest hardship in Rhode Island right now.

22 Do they pay? Yes. We have eight dentists that 23 don't really like to pay and every year they have to have at 24 least two reminder notices and be called by our legal 25 counsel to pay. We don't have to have hearings or have it I

l O' 1 153 referred to the AG's office at this point.

2 That's about it.

3 MR. GODWIN FROM ALABAMA: Questions?

4. MR. FUENTE FROM MISSISSIPPI: You three people who 5 have already spoken, this question could apply to all. Do 6 you receive the question from your registrants and licensees 7 about how often you inspect? Is this part of the services 8 provided? You mentioned eight dentists that you have a 9 problem with. Do they expect you to inspect them annually 10 for this fee they are paying you? Do you get questions like 11 this from these people?

12 MS. ROBINSON FROM RHODE ISLAND: The eight t 13 dentists that I referred to don't want to pay at all. They 14 have made that quite clear. They have written numerous 15 letters. They don't think the fee is fair and they don't 16 think they should have to pay whether we did it ever year or 17 every four years. They just don't think they should have to 18 pay at all. And it's the same eight.

19 MR. BORCHERT FROM NEBRASKA: We injected an 20 inspection frequency into our regulations when we put the 21 regulations together. We based the fee for the x-ray people 22 on that inspection frequency. There is a formula in the 23 regulations that shows how to calculate the fee if you are a 24 physician, if you are a chiropractor, veterinarian, dentist, 25 whatever. Part of the fee structure is based on the b

v

O 1 inspection frequency.

154  !

2 MS. LIPOTI FROM NEW JERSEY: How close are you to

3. keeping to that inspection schedule?

.4 MR..BORCHERT FROM NEBRASKA: Since I just got some 1

5 new people that have just gotten off probation, we are just 6 starting that inspection schedule. Ask me that question a 1 7 year from now.

8 MR. NASH FROM-FLORIDA: The way we kind of handle l

9 some of this is that all new licenses are either a 10 pre-license visit from one of-my evaluators or is hand 11 delivered by an inspector. That's all new licenses. Very 12 complicated licenses we send somebody from Tallahassee. The

( 13 rather routine licenses are delivered by an inspector where 14 they sit down and talk to the licensee.

15 MR. GODWIN FROM ALABAMA: Further questions?

16 (No response.)

l 17 Ray.

18 MR. PARIS FROM OREGON: I've got a little show and 19 tell here.  ;

20 [ Slides shown.]

21 An applicant sends in a request. It comes into 22 our program. We send out an application packet. This 23 happens to be a fixed gauge. In this packet we have a guide 24 that goes with it, some exposure stuff, personnel 25 monitoring, instrument vendors, and so forth.

O v

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l

() 1 Then we have also a document down here. It is a 155 2 fiscal form that they fill out.- Along with that comes a 3 fiscal envelope. What they are supposed to do is send the ,

4 fiscal envelope to our cashier's office. We do not receive 5 ' actual cash in our program.

L  ;

6 Then when this comes back into us we fill out the '

7 bottom part of this fiscal sheet, and that also goes to the l 1

8 cashier's office. The information that we get and the I I

9 cashier.gets is supposed to jibe.

l 1

10 The applicant fills out the upper portion and we i j 11 fill out the lower portion. This here is what is supposed 12 to match for the fiscal people. Then fiscal will send what I 13 is called a daily cash receipts. This happens to be a

(

l 14 licensee. It comes into a fund. This is the amount that

(

l 15 was received.

! 16 We also get money for rules. We sell our rules to 17 people. That comes in as cash. So it also documents the 18 rules.

19 Fiscal sends us this. The problem is sometimes 20 the licensee doesn't send in the right amount. Then there l

21 is this reconciliation problem between what fiscal has and 22 what we got. Fiscal doesn't know beans about our license 23 stuff, so they send it back to us. It takes staff time to l

24 reconcile the problems. It just eats up all kinds of staff

( 25 time.

!O m-. m-.--

.)

1 At this point, if everything j ibes, fiscal sends 2 us this fee statement. We reconcile it. Then we initiate a 3 licensing program to a different entity, another section, 4 called our data processing section or information services.

5 They print the license.

6 That's what this is. It has an Oregon license 7 number. This happens to be our own unique license. We 8 don't charge ourself.

9 We have the same problems you do with another 10 section doing the printing. They get off center. It's a 11 bad situation. We are moving in that direction. We could 12 probably do it with the materials program, because we only have around 300 licensees, but we have got over 6,000

( )13 14 registrants. We want to do the whole thing but it takes a 15 pretty high speed printer. You'd burn out a little laser 16 printer.

17 There is an expiration date on the license that 18 goes out.

19 So that's our whole process. We have other people 20 involved. It isn't as smooth sailing as it should be or 21 like we would like to have it.

22 Any questions?

23 MR. FUENTE FROM MISSISSIPPI: Ray, do you have a 24 fee for your registrants?

25 MR. PARIS FROM OREGON: Yes, we do, for x-ray O

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P I '~

157 -

)

4 1 people. It's.$100.00 per machine.

I

{ 2 MR. FUENTE FROM_ MISSISSIPPI: Do they have an i

j 3 annual expiration date too on their registration? .

l l 4 MR. PARIS FROM OREGON: Yes. It's annual t

]. 5 expiration on material as well as x-ray registrants. So we i

j 6 have a bottleneck on July 1 of each year. We have to bring i

j '7 in temporary help for about a two-month period to get over i i

! 8 this. It would be nice to have 10 percent per month like i 9 Nebraska has.

f i l 10 MR. GODWIN FROM ALABAMA: I like that system too. 1 i l j 11 MR. BAILEY FROM CALIFORNIA: You bill everybody at l

j 12 -the same time?

(

r (13 MR. PARIS FROM OREGON: Everybody at the same

14 time. Another problem is that when you have 6,000 mailings, 15 you've got to get the mail room people involved. The

• l j 16 stuffing and the folding is a major problem. This is where l 17 the' hidden costs that don't show up on the cost of the i

18 program can be factored'in.

19 MR. FUENTE FROM MISSISSIPPI: All your material 20 licenses have an annual expiration date?

I 21 MR. PARIS FROM OREGON: Right. 1 22 MR. FUENTE FROM MISSISSIPPI: Do they have to  !

23 submit a new application each year?

24 MR. PARIS FROM OREGON: No. They have to submit a 25 renewal fee. We are on a five-year renewal cycle like most O

l \

l I

158 1 everybody else. This is a renewal notice. We send out i

2 renewal notices.

' 3 MR. FUENTE FROM MISSISSIPPI: Do you charge 4 amendment-fees?

5 MR. PARIS FROM OREGON: No. Just simply a license 6 fee.

7 MR. GODWIN FROM ALABAMA: Anyone else?

8 [No response.]

9 Bruce.

10 MR. HOKEL FROM IOWA: We do the same thing as 11 everybody. We don't process any license requests until we 12 receive the money. I kind of sit here and drool at Aubrey's 13

( system. We've got a long ways to go before;we get 14 computerized to the point where we want to be. The way we i

15 are operating now, I don't know if we would be able to do l 16 it.

l 17 MR. GODWIN FROM ALABAMA: For a small fee we'll 18 sell our program.

19 MR. HOKEL FROM IOWA: The fees come in and we 20 never see any of the money. It comes in and it goes up to 21 the auditing department. They stamp it and say it came in 22 on this date in this amount. That's really not a problem.

23 For renewal of licenses, every five years we send 24 out a renewal notice 90 days ahead of time, very similar if 25 not identical to what NRC does. We put the amount right on O

O 1 it that.is due.

159

'2 The same thing with a new license. We will send 3 out a packet similar to what you do. That also has the  !

4 amount due written right on it for the. licensee or potential l

5 licensee.

6 The same way with inspections. We will invoice 7 them, saying we did the inspection on this date and you owe j

.8 this amount.

1 9 Sometimes a problem comes in when the licensee i 10

~

will send in an amendment request on his own and he doesn't  ;

11 know that our fees have gone up. Since we don't see the  ;

12 money before it comes back down from the auditors, then we

()13 have to refund or ask for more money.

14 So'we've got a long ways to go as far as getting 15 that automated. So far we haven't had any major problems.

16 The biggest problem we have is not having a secretarial 17 staff to track all that and take care of it. When we did f

18 have them it worked out pretty good. We have a list that i

19 says these licenses are due to expire on these dates and 20 they would send out the renewal notices. Now we are having 21 to do that and sometimes you forget.- The other thing is 22 tracking to make sure that they have indeed sent in the 23 renewal fee and inspection fees. Our tracking system is 24 getting damaged by the lack of secretarial support, but 25 hopefully that will get fixed.

O

1 That's essentially how we operate. I think that's 2 similar to how NRC does their renewal notice.

3 Questions?

4 MR. GODWIN FROM ALABAMA: Just a comment. You are 5 the first one to mention this. You might just think a 6 minute about how you receive the fees. We receive the 7 check. No matter how it comes in, the original goes back to 8 whoever sent in the check, one copy goes with the 9 application or whatever is associated with it, or goes to 10 the file in the case of an annual fee, and the other copy 11 remains in a fixed receipt folder so we can always look and 12 see how many receipts we issued. They are all numbered.

[v ) 13 You can tell when a number is missing or when somebody has 14 taken something out. If you void it, you have to have all 15 three copies present. That's the way you keep that kind of 16 accountability going. I guess most everybody does pretty 17 much the same. j 18 MR. FUENTE FROM MISSISSIPPI: Do you Xerox your l

19 checks for your records?

20 MR. GODWIN FROM ALABAMA: We do not, because we 21 have the handwritten receipt plus the transfer list of the 22 checks that went over to finance. They sign for them at 23 finance every time we take them over.

l 24 MR. FUENTE FROM MISSISSIPPI: We in Mississippi 25 Xerox our checks too so we will always have a record if O

n U 1 there is any question.

161 2 MR. HOKEL FROM IOWA: One of our secretaries did 3 that on her own. I just happened to see a Xeroxed check one 4 day. It was her idea. We don't do it on a routine basis.

5 MR. GODWIN FROM ALABAMA: What do you do when the 6 check bounces? They do that?

7 MR. FUENTE FROM MISSISSIPPI: I'll answer that.

8 We get direct orders from our finance people that they 9 either have to submit a money order or some other type 10 payment other than check.

11 MR. GODWIN FROM ALABAMA: Does anybody else want 12 to answer that?

()13 MS. SHORT FROM TENNESSEE: We require payment by

, 14 either money order or cashier's check plus a $15.00 bad 15 check penalty. We get probably six or seven bad checks per 16 year. We have one dentist who for the first three or four

, 17 years that we collected fees faithfully bounced every check 18 that he ever sent to us. I think he had a special 19 non-account just for us. l 20 MR. GODWIN FROM ALABAMA: When one bounces in 21 Alabama we check to see if it's a licensing actlin or 22 something like that. If we haven't taken action on it, we 23 simply hold it and send them a letter saying we won't do 24 anything until you send us the money. We hold it until the 25 check clears that time. He just loses about six weeks, in O

4 i

( 162 1 other words.

l 2 MS. SHORT FROM TENNESSEE: We don't have any )

3 licensees bounce' checks on us. All of our licensees are l I

4 good guys.

5 MR. GODWIN FROM ALABAMA: We have one, who shall 6 remain nameless. If we have one that was not that kind of j 7 an action, not a licensing action, or had already cleared, i

8 we would simply invoice them for failure to pay their fee, i

9 wait 45 days, and suspend their license. We just put it 4

l 10 into the invoice group and go on.

11 Dennis.

12 MR. O'DOWD FROM NEW HAMPSHIRE: We send out our r 13 x-ray registration notices at the beginning of each new 1

( )\

14 fiscal year, which is in July, to all our X-ray registrants.

! 15 Our rad material notices go out with the annual license 16 notice. Like Oregon, New Hampshire issues licenses for only  ;

l l 17 one year at a time. It's a maintenance license, if you l

! i l

l 18 will.

i 19 So we never really have any problem with our 20 licensees as far as fees are concerned. I don't recall 3

21 there ever being a problem. If we don't get the license 22 fee, we won't do that licensing action. It has never 3

23 happened where we have had to take any action like that.

24 It's the x-ray registrants that we have the most )

25 problem with. There is always a number that come up every l

(~)

(_,

l'

( 163 1 year that refuse to pay. We try to refer the problem to the j 1

2 attorney general's office, but are not interested in {l 3 collecting our outstanding fees either. So they put the 4 ball back in our court and we just keep on writing letters  ;

5 and threatening. It's a persistent problem.

6 MR. GODWIN FROM ALABAMA: Questions? i 7 MR. BORCHERT FROM NEBRASKA: Dennis, have you ever 8 thought about taking it to your agency legal counsel and 9 have them write a letter for you?

10 MR. O'DOWD FROM NEW HAMPSHIRE: I suppose that is 11 an avenue that hasn't been explored. We don't have an l 12 attorney for the Division of Public Health. We have a legal

((~ ) 13 consultant, paralegal type person. She really is the person 14 that would refer it back to the attorney general's office.

15 We don't even have our own attorney. The division has been 16 asking for one for a number of years.

17 MR. GODWIN FROM ALABAMA: In Alabama, the reason 18 we refer it to the attorney general is to keep the audit 19 from being an exception. If you have referred it to the 20 attorney general, it's his responsibility. The agency has 21 no more responsibility. Even if he sends it back, once you 22 refer it to the attorney general, he has the right to 23 determine that nothing will be paid. That's okay. But if 24 you don't refer it to him, the agency individuals can be 25 held personally liable for those fees. I've got a little O

1 aversion to that, frankly.

2 Any other questions?

3 [No response.]

I 4 MR. BOHLINGER FROM LOUISIANA: We charge an 5 initial application fee for all of our registrants, material 6 licensees and normal licensees. Then we charge an annual 7 fee, which is essentially the same as the initial 8 application fee. We also have a computerized dBASE. We 9 generate our own invoices. We have the checks come back to 10 us. Daily we take these checks to the fiscal services 11 department. They use just your standard auditing procedures 12 to record receipts and report any receipts.

( 13 As far as follow-up invoices, if we don't get 14 payment within 30 days, we issue an NOV. It's considered a 15 major violation. If we don't receive it then, we go to a 16 compliance order and then to a civil penalty. I'd say in 99 17 percent of the cases it's an oversight if we don't get the 18 payment right away. We get some nasty notes written on the 19 invoices from the dentists and so forth, but we collect over 20 99 percent of all of our fees.

21 In the few cases where we fail to, even after 22 issuing a civil penalty notice, we do as a last resort as a 23 formality turn it over to the AG's office. It is totally 24 useless to do that, but it covers our auditing.

25 Like the other states, we do not issue a license O

O

1. cn - registration until the fee is. paid.

1 2 MR. GODWIN FROM ALABAMA: Questions?. ,

3 MR. FUENTE FROM MISSISSIPPI: The people who are I 4 handling <your money, I know they are bonded and all. Do you 5 have'a special' class person dealing with the fees, or is it 6 the clerical staff? Who does this?

l 7 MR. BOHLINGER FROM LOUISIANA: We have analysts ,

i j 8 that generate the invoices and collect our checks. They go 9 to the fiscal services, which are the accountants for our 10 department. This is all done in house. Then the 11 accountants go over to the. treasury office and deposit it in l 12 our environmental trust fund. But we have to daily get rid

.13

( of all the checks that come in. The same with our civil and 14 criminal penalties and settlements or anything else. It has i

15 to immediately be turned over to fiscal. We are not bonded. I 16 MR. FRAZEE FROM WASHINGTON: A couple times the 17 AGs have been mentioned. So far it hasn't really been in a l 18 positive vein. Is that typically what is happening? In our 19 state we have had fairly good success with the AGs. They 20 don't want to deal with it until we have done everything we 21 can, but once we have, then they will go through and do the 22 paper work and take them to court if that is necessary. I 23 gather that is not the case universally, l

24 MR. BOHLINGER FROM LOUISIANA: We've never 25 collected from one we turned over to the AG.

O l

4 i

i  ?

4 166 1 j 1~ MR. FUENTE FROM MISSISSIPPI: We have in i

i 2 Mississippi.

3 MR. BAILEY FROM CALIFORNIA: Speaking from when I l i

)

4 was in Texas, there was a separate unit set up in the AG's '

i j 5 office for debt collection. They took all of the debts they

6 collected up until they got to the amount.that they needed l-

. 7 to fund that department, and then all the other-money

8 reverted to the programs. When I was there we never had any_

t 1 9 money withheld, but we would send it over to them and they i

10 would get a letter out the same day, saying this debt has i 11 been referred to us by the Health. Department; be advised 3

j 12 that if you don't pay up right away, the Attorney General of

,()13 e

Texas will file suit against you.

14 The key was that they wouldn't file suit for i

15 anybody less than $500.00. But they didn't have many people' '

16 refuse to pay. There was a whole separate unit set up for 17 that purpose.

18 MR. GODWIN FROM ALABAMA: Mary.

1 19 MS. SHORT FROM TENNESSEE: In Tennessee when an i 20 invoice was not paid, under the old laws we issued a notice 21 of noncompliance and then a delegated Commissioner's order i 22 and nonpayment of those orders were turned over to the AG's 23 office. In our AG's office, in a hallway there was a box'on 24 the floor full of our orders that they did not collect.

25 They now have four boxes of our orders on the floor that ,

O

4 i  !

t 1 they won't collect._ They are just there. I don't know what a

2 will happen if the AG's office'ever moves, like to another j 3 building. It's like Aubrey says. You get them off your [

4 back and onto somebody else's. i

). 5 MR. BAILEY FROM CALIFORNIA: One way you can do it '

J 6 that sometimes works is you send out the inspector and you

7 find the violations and among those violations is the 8 _ failure to pay fees. If the other violations add up to i

[ 9 enough, you can get the local DA to go to court against them i 10 and so forth. So pile it on to some other violations, which

.11 _

gets it up to a high enough level-either in civil penalties

{ 12 or administrative penalties or criminal penalties, depending ,

()13 on which state, so the local district attorney or the AG I 14 will then take it.

i l

! 15 MR. BLANTON: When I was in Arizona we had a 16 similar problem getting the AG's office to collect the l

17 smaller license fees. What we were able to do is define as j

18 a violation the failure to pay an annual fee and that

[ 19 carried a flat $1,000.00 fine. Then we referred the whole i

j- 20 thing over to the AG. So they were going after a minimum of i i 21 $1,000.00, and that made it worth their while.

I 22 MS. SHORT FROM TENNESSEE: That's what ours have i

, 23' too, but it still doesn't sue. It's just not enough. I 24 MR. GODWIN FROM ALABAMA: What does NRC do to

}- 25 collect theirs? Do you refer them to the U.S. attorney?

4

1

[~h 168 l V

1 MS. JACKSON: Yes. We have several different 2 methods to do that. It depends on the dollar amount. The 3 first mechanism is to issue the order revoking the license.

4 MR. GODWIN FROM ALABAMA: You revoke the license? l l

5. MS. JACKSON: Yes.  !

6 MR. GODWIN FROM ALABAMA: What if they still have 7 the material?

8 MS. JACKSON: Then that's up to the regional .

)

9 office to take care of. At that point, if they have not 1

10 paid, it's still a debt to the government. We are getting 11 ready to go to contract with a debt collection agency. We 12 turn it over to debt collectors and also we report it to

()13 consumer reporting agencies as bad debts to the government.

14 MR. PARKER: I can't tell from the discussion if 15 this is a major problem or not. I'm surprised there are 16 four boxes outside the the AG's office of non-collected 17 fees. These people are in violation of the law. Their 18 liability must increase geometrically every time they don't 19 pay their fee.

20 MS. SHORT FROM TENNESSEE: No. Once a 21 Commissioner's order is issued, then as far as our books are 22 concerned in the division, we basically zero it out and 23 start over from there. We have offenders with multiple 24 years of violations and multiple nonpayment of fees. It 25 would be really nice to have some support and have these b

v

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

( 169 1 fees collected, but it just hasn't worked that way.

2 MR. GODWIN FROM ALABAMA: Do you suspend their ,

1 3 license?

4 MS. SHORT FROM TENNESSEE

These are all x-ray 5 registrants.

6 MR. BOHLINGER FROM LOUISIANA: The registrations 7 have no expiration date on them.

8 MR. GODWIN FROM ALABAMA: Yes, but you can still 9 suspend them.

i 10 MR. BOHLINGER FROM LOUISIANA: Yes, but it's kind  ;

i j 11 of tough to do.

12 MR. FUENTE FROM MISSISSIPPI: Let's face it now.

I've been listening to all of this. I'd be willing to say

) 13 14 that most of the problems are with registrants and not 15 licensees. You take that bread and butter away from that 16 dentist or that doctor and see what happens.

17 MS. SHORT FROM TENNESSEE: He would kill you.

18 MR. GODWIN FROM ALABAMA: Any more comments on 19 this?

20 MS. JACKSON: Yes, aubrey. Also, if there is a 21 licensee who hasn't paid, we flag that licensee in the 22 computer system that no further action can be taken on his 23 license until the debt is satisfied. If his license is 24 revoked or terminated, we also send out notices to all the l 25 licensing staff that they should not process any future O

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

1 i

j.

170 l j 1 . applications from that licensee for a new license to replace j- 2 that one until he has paid all the outstanding debts owed.to U  :

i 3 the government plus the interest and~ administrative charges  !

2  !

4 and penalties. So it is not only the license.that he has, i 5 but it's any future applications.

t i j- 6 MR. FRAZEE FROM WASHINGTON: That's an interesting

! 7 concept, telling-licensing staff not to reissue a' license.

I i 8 These folks come in under a corporate name one day and then 9 the next day they are somebody else. Unless you have got

! .10 some really skillful investigators, you may never even know l j

i 11 that it's the same person. c i

12 MR. BAILEY FROM CALIFORNIA: They're usually dumb i 13 enough to use the same name.

(

14 MR. FRAZEE FROM WASHINGTON: Some of them are. ,

15 MR. GODWIN FROM ALABAMA: We do advise our staff 16 about that. We had one that came back showing the same 17 ownership with-a new company and we just picked him up 18 immediately. It wasn't any problem. He went to Mississippi-19 and tried to come back.

20 MR. FUENTE FROM MISSISSIPPI: He's going back.

21 MR. GODWIN FROM ALABAMA: He's back in Alabama 22 now.

23 Tom.

24 MR. HILL FROM GEORGIA: We generate our invoices 25 in house for inspections. We've got a dBASE program and O

17'1.

1 laser printer. We do have general license fees and we 2 invoice our general licensees on a quarterly basis, 25 3 percent of them a quarter. We have a unique invoice number 4 on each of those as well as on the inspection invoices.

5 They go out monthly. By the 10th of the month we invoice 6 all the people that have_been inspected the previous month, i 7 All of the fees come into our office. If a i

8 licensing action or amendment or whatever comes in without a j 9 fee attached, we notify them that they are required to pay 10 the fee and the amount, and if we don't receive it in 15 11 days, we consider their request abandoned by them. So far

.l 12 we have not issued any licensing actions without having the 13 fees paid.

(

14 We have about six or eight who have not paid their 15 inspection fees. Now this is two years. I think a couple 16 of those we goofed up and didn't send the invoice to them.

17 So I guess those will be written off.

18 The others have been notified twice. We are 19 getting ready to refer those on and see how the 20_ administration wants to enforce the board policy. I don't 21 know which way it will go. We will know within the next i

22 couple of months what actions will be taken beyond that. l 23 I think that covers most of the points. Really no 24 major' problems collecting the fees so far. Some of the 25 general license fees have been a bit of a problem. That's O

() 1 $100.00 a year' currently. One of the biggest things we 172 3

l l 2 found out when we started doing invoices is we didn't have 3 near as many general licensees out there as we thought we 4 did.

5 MR. BAILEY FROM CALIFORNIA: Are you doing all of 6 the people who are licensed under the GL, like the exit 7 markers and all, who are actually licensed under that gauge

. 8 provision?

9 MR. HILL FROM GEORGIA: Yes. All of the exit a

10 signs and all are. Under the proposed one that will be 11 coming out, if it's approved, exit signs will be exempted.

4 12 MR. GODWIN FROM ALABAMA: Ray.

()13 MR. PARIS FROM OREGON: Tom, do you receive the 14 money yourself? l 4

15 MR. HILL FROM GEORGIA: Yes. It comes into the 16 program. Two of us handle the checks. The secretary gets 4

17 rid of them as quick as she can in my in-box. I collect 18 them, indicate whether or not a fee has been paid and how 1

19 much. I have one person who generates our deposit tickets 20 with a list of all the information that accounting wants.

I 21 That is forwarded to accounting with the list. It's not 22 donc daily, but it is done at least once a week and 23 generally twice.

24 We are physically separated from accounting by ten 25 or 11 miles. We don't use the interoffice mail to send

I\ 173 V

1 checks.

2 MR. HOKEL FROM IOWA: Do you have a safe or 3 something like that to secure them in?

4 MR. HILL FROM GEORGIA: I have a safe in my 5 office.

6 MR. GODWIN FROM ALABAMA: Do you restrictively 7 endorse them?

8 MR. HILL FROM GEORGIA: I only restrictively 9 endorse those that are not made payable to the department.

10 Even though it says make the check payable to the. Department 11 of Natural Resources, they come in made payable to the 12 Radioactive Materials Program or to the. Radiological

( 13. Program. Those I restrictively endorse as soon as I see 14 them.

15 MR. BAILEY FROM CALIFORNIA: Are you doing x-ray 16 too?

17 MR. HILL FROM GEORGIA: No.

18. MR. FLOYD FROM NEW MEXICO: Do you occasionally 19 get a check not signed?

20 MR. HILL FPOM GEORGIA: I have not found a check

21. not signed. We just returned one the other day. It was 22 $320 in one spot and $230 in the other.

23 MR. GODWIN FROM ALABAMA: Our folks advised us to 24 cash those and you always use the handwritten amount rather 25 than the numerical amount. They said put them in like that.

D V

1 They will go through the bank at that amount, and then we 2 will bill them for the difference or send back the 3 difference.

4 MR. HILL FROM GEORGIA: Accounting told me to 5 return it. It was typed on and it was not spelled out. It 6 was numerical in both places.

7 MR. GODWIN FROM ALABAMA: That would be a problem.

8 Any other comments?

9 MR. BORCHERT FROM NEBRASKA: It was interesting, 10 Tom, what you said about general license devices. We bill 11 generally licensed users $50.00 per year. It is interesting 12 to find out that you have a lot less than what you thought

( 13 you had. Also, on inspections we are coming up with about 14 50 percent of the devices accounted for. So about 50 15 percent of them are not accounted for.

16 MR. BAILEY FROM CALIFORNIA: Is it $50.00 per 17 general licensee or $50.00 per device?

18 MR. BORCHERT FROM NEBRASKA: Fifty dollars per 19 general licensee.

20 MR. HILL FROM GEORGIA: Per general licensee.

21 MR. NASH FROM FLORIDA: No matter how many they 22 have?

23 MR. BORCHERT FROM NEBRASKA: No matter if they 24 have one or 100.

25 MS. SHORT FROM TENNESSEE: It's $100.00 per O

J i  !

I [

, i i i i /'h

(_) 175 l

i e

i license in Tennessee. i 1

[

2 MR. FUENTE FROM. MISSISSIPPI: A hundred here too. .

I 3: MR.. MILL FROM GEORGIA: A lot of our specific

! 4 licensees have generally licensed devices and they will put j t

. 5 them on their specific license frequently land they are not j i

f': . 6 billed twice. >

js 7 MR. BAILEY FROM CALIFORNIA: We think some of ours <

t .

8 may add theirs as soon~as-we start charging for generally l

9 licensed, because it may be cheaper at a dollar per  !

i .

l i 10 millicurie than it will-be under the general license per  ;

! 1 l- 11 device. l l

j 12 MR. GODWIN FROM ALABAMA: Other questions?

.13 MR. FUENTE FROM MISSISSIPPI:

( A lot of times, if

14 they have both a specific license and general license, we l

l 15 encourage-them to go with the specific license.

16 MR. HILL FROM GEORGIA: For accountability, we do,

17 too.

18 MR. NASH FROM FLORIDA: If the dollar amount gets i

19 up by the device where it is cheaper to get a specific

20 license, we advise them to get a specific license. I

'l j; 21 MS. SHORT FROM TENNESSEE: Yours is by device

! 22 then?

23 MR. NASH FROM FLORIDA: Yes.

! )

24 MR. GODWIN FROM ALABAMA: Other comments?

l 25 (No response.] j i 'O

! (_/

v J I

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

l l

l l

/O 176 I N~  !

1 MR. GODWIN FROM ALABAMA: Mary. I 2 MS. SHORT FROM TENNESSEE: Tennessee has two major )

3 fee programs. One is x-ray registration and one is 4 radioactive material licensing.

5 The x-ray fee program is divided into x-ray 6 registrants and the fees range right now from $35.00 per 7 year per dental tube for anyone who has two or fewer tubes 8 and then it would be an additional $25.00 up to $400.00 per 9 year for accelerators. Those fees are changing probably 10 around July 1. Dental tubes will be $65.00; accelerators  !

i 11 will be $1,000; other tubes and industrial tubes will be '

12 spread out through those two ranges. )

l

(}13 We have more troubler with the x-ray registrants )

14 as far as paying. We have over 1,900 dentists. Like 15 everyone else has said, they are very vocal. Also our 16 veterinarians and podiatrists and chiropractors are very 17 vocal. The medical private practitioners are relatively 18 vocal. Hospitals don't give us much trouble at all and the 19 industrial facilities don't.

20 In our licensing program we have a fee for 21 generally licensed device holders, which is $100.00 per i

22 facility. They also can have a general license condition on j, 23 specific licenses if they possess a specific license, but if 24 they do, then they have to leak test, or whatever, their 25 generally licensed devices with the same frequency that they l

(J

. _ . . _ . . . . _ _ _ _ _ . _ . . ~ _ . _ . . _ _ _ . _ _ _ . _ _ . . . _ _ . _ _ _ _ _ . _ _ _ _

4 F

I $

4

! 1 do their specifically licensed devices. So sometimes they f

2 choose not to'do that.  :

1

3 The fees for specific licenses up until last' July  !

j 4 1 ranged from'$200.00 per license through $10,000 per j 5 license. As of last July 1 those fees changed to $200.00

} 6 per license to $20,000 per license. The portable gauge fees

-i 7 that got to be $4,000 with the change last year.went from i . i

! 8 $200 to $4,000. Which was.really interesting and kind of. l 1

9 tore everybody up.

j 10 There was a double whammy. It was an accidental i j- 11 thing. Mike Mobley had decided that they should be in a 12 higher category than they were at $200.00, and at the same 13

( time the fees were changing. So they were put into a system 14 where they went from being $200.00 to $2,000.00, but at the i

i 15 same time the~other system happened, which doubled the 4

16 $2,000.00 and made it $4,000.00. Those are being changed.

! 17 As of May 15 they will be $600.00 for licenses that involve

18 possession of two or fewer devices and $1,400.00 for more f 19 than that.

1 i 20 our reciprocity fees are the same as our Tennessee

! 21 licensee fees. The only reciprocity fee'that we have ever j 22 not been able to collect is an Alabama licensee that we are 23 l working on.. In fact, under our new law, our very first j i

! 24 civil penalty and commissioner's request for revocation of 1 j 25 the license, except we can't do that since it's not a j i

t

, _ . _ - - , - - . , .-, . , ,-.,--,4 ., . - . , , . , _ ,y ., .-.---.r , , , , , . - , - , - . . . . ~ I

l l

l 1

1 I'T 178 V

1 Tennessee licensee, is out against this. guy. It's kind of j 2 neat. We're kind of enjoying that.

3 We also have under our.new law two new types of  !

4 license fees that we never collected-before.

5 One is our low level radioactive waste processing I

6 fee, which is a fee that is paid to us at one penny per i 7 pound for waste received by the processors that are in Oak

8. Ridge, SEG, Quadrex, and DSSI, and then a waste shippers fee 9 for any generators that ship waste to those processors '

10 unless they use a licensed broker. That fee is $400.00 per  ;

i 11 year. That is brand new. We just started working with that I 12 in December. It is really big bucks. It's really kind of )

( ) 13 neat to see the money coming in on that.

14 We do every bit of our fee invoice generation, 15 collection, bank deposits, accounts receivable in our 16 office. Nobody else ever even sees one of our checks other 17 than our staff.

18. There is a move afoot under the new department to 19 which we were transferred last July to change that so that 20 all this is done elsewhere. As labor intensive as fee 21 collection is and everything that goes with it, I think that 22 'really would be a nightmare and hope it doesn't happen. You 23 all know you get checks without invoices and you get checks 24 in. totally different names from the way that you have the 25 facilities listed. Trying to chase the stuff down is hard O

i i

j 1 enough if you know the folks. For people who have clerk 2's l

2

who could care less about radiological health someplace else l r  !

l 3 to try to find out what to do with the money and get it put 1

4 in the right place, I think it would just be awful. So we l 5 are hoping that that doesn't happen for us.

6 I guess that's about it. I 7 MR. GODWIN FROM ALABAMA: Questions?

8 MR. FUENTE FROM MISSISSIPPI: Mary Helen, just a l 9 suggestion on revocation. Some years ago Aubrey and I were  ;

i 10 dealing with a licensee who had a license both in Alabama 11 and Mississippi. For some of the actions he did in Alabama 12 Aubrey was successful in getting his license revoked in

( ) 13 Alabama, but he still had a Mississippi license. So seeing 14 that, I had some legislation introduced to the effect that i

15 if a license is revoked, modified or suspended in another i

16 state or by NRC, it would automatically be the same thing in 17 Mississippi. You might want to consider something like that 18 to take care of that Alabama licensee.

19 MS. SHORT FROM TENNESSEE: We would like to do 20 something with it. They used to tell me at one time that 21 the check was in the mail.

22 MR. GODWIN FROM ALABAMA: I've heard that before.

23 [ Laughter.]

24 MS. SHORT FROM TENNESSEE: I know, but generally, 25 when somebody says that, at least they have some sort of

- . ~ - _ - -

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

i l

k  !

a a

i C)

intention of putting one in the mail at some point.

! 1 I 2 MR. NASH FROM FLORIDA: You may think of not doing

)

d 3 what Eddie says, too. 'If NRC suspends a licensee who 4 happens to be in your state, you may or may not want to

.5 suspend'that. I remember the radiographer that they shut 6 down two years ago. We inspected each one in our state and

{

i 7 .found them to be clean and we allowed them to continue.to l 8 operate in the State of Florida.

9 MR. BLANTON: Mr Ty , do you have a computer 10 database?

11 MS. SHORT FROM TENNESSEE: Yes. It's a Focus 12- program. Both the license program and the x-ray fee program 13 are technical program driven as far as the information is

(

14 concerned. The Focus programs for the fees are set up to 15 produce the invoices. We don't produce invoices in 16 duplicate; we produce one only, and it's mailed, but.then 17 we've got accounts receivable information that shows us what 18 was sent out. At the time we have to be involved in 19 collecting civil penalties or whatever, all we do is just 20 tell the computer to produce a duplicate so we don't have 21 stacks of invoices sitting around that we would never use 22 for any other purpose.

23 We have over 4,000 x-ray registrants, 578 specific i

24 licensees, 450 general licensees. After we get rid of all 25 of the generators that are using brokers, we will probably

181 4

1 have about 150 of those licenses that we are working with.

l 2 MR. BLAND: Is that on a PC or is that on a 3 mainframe computer?

4 MS. SHORT FROM TENNESSEE: All of our computers

5 are just PC types.

6 MR. GODWIN FROM ALABAMA: Eddie.

4 7

MR. FUENTE FROM MISSISSIPPI: Mary Helen, you 8 receive your checks and you make deposit slips. Does t

9 someone audit you?

10 MS. SHORT FROM TENNESSEE: Our first fee 11 collection year was 1983. We collected fees in January and 12 February. We were audited in October by the department's t 13 internal audit staff. This past year we had a comptroller's 14 audit that lasted for about a day and a half. Other than 15 that nobody has darkened our door. We keep thinking that

16 someone will move in with us for a year or so and take us 17 apart, but they haven't done that yet. Except for NRC.

18 [ Laughter.]

19 MR. GODWIN FROM ALABAMA: Other questions?

20 MR. BOHLINGER FROM LOUISIANA: I didn't mention it i l

23 and I didn't hear anyone else mention it. We also charge a 22 one-time fee of $700.00 for a shielding evaluation. Do 23 other programs do that as well?

24 MS. SHORT FROM TENNESSEE: We don't do that, but 25 we charge a per MEV fee for accelerator evaluations before 4

'T

.. . - - - - . - - ~ . = . - . . - . ~ ~ . . _ - - . - - - - _ - . . . . . . . . . . . . - . - . .

182

(

1 we issue those.

2 MR. HILL FROM GEORGIA: We start with-diagnostics 3 per MEV, too.

4 MR. THOMPSON FROM ARKANSAS: How much was your 5 fee? f 6 MR. HILL FROM GEORGIA: Anywhere between one and 7 seven fifty, depending on the type of application.

8 MR. BAILEY FROM CALIFORNIA: The shielding 9 ' requirements of radiation which NRC hasn't noticed, I don't 10 think, yet, are actually in the California building code.

11 The local counties and cities do the' shielding evaluation 12 and charge people. And it's a moneymaker.

13

( MR. FUENTE FROM MISSISSIPPI: To further what Hall 14 was saying, do you charge your x-ray installers, repairmen, 15 concultants a fee?

16 MR. BOHLINGER FROM LOUISIANA: Yes.

17 MR. FUENTE FROM MISSISSIPPI: We do in 18 Mississippi, too. An annual fee. .

1 1

19 MS. SHORT FROM TENNESSEE: I haven't heard anybody )

l 20 else mention it. We also have a registered inspector 21 program for our x-ray facilities in Tennessee. Anyone who 22 wants to can employ a person who is qualified to do this 23 work and registered with us -- right now the registered 24 inspectors pay us $150.00 a year to register, but that is 25 going up to $500.00 -- to come and do their inspections and O

1 M - -ew-e w -m e y e.-- -, .%<.1 g w

. - - ' y ~

1 they can pay us 18 percent of the legislated fee.

2 MR. GODWIN FROM ALABAMA: How much time.do you 3 estimate you spend on collecting for the materials part of 4 the program right now?

5 MS. SHORT FROM TENNESSEE: Just materials?

6 MR. GODWIN FROM ALABAMA: Just materials.

7 MS. SHORT FROM TENNESSEE: We take two overnights 8 to print the invoices, because we do that kind of thing at 9 night.

10 MR. GODWIN FROM ALABAMA: This is how many 11 licensees?

12 MS. SHORT FROM TENNESSEE: Five hundred and

[%./

) 13 seventy-eight specifics and 450 generals. The saippers are 14 going to be around 150, whatever that shakes out to be.

15 It takes two overnights to print them. It would 16 take two staff probably three days to stuff and label the 17 envelopes. We figure about ten minutes per receipt from 18 opening the envelope, endorsing the check, receipting the 19 check, putting whatever has to go in whatever little stacks 20 and stuff. We ' figure about 60 checks per hour to on.a 21 certificate of deposit. I don't know what that would figure 22 up to be. The x-ray fee program is much more so. Because 23 of the reduced fee that those can pay, we use the registered 24 inspectors plus the fact that the program is four or five 25 times the size just in numbers of facilities to begin with.

(Q) 1

- . _ _ - _ _ = - - . - . - - . . . -. . . _ _ - . _ _ -

t 1

1 i

l d

1 I have a staff of two folks who are full time, 2 nothing but fee folks. Then when we send out annual 3 invoices each year we take all of our clerical staff and

, 4 throw them into that and it takes about a week or two weeks 5 to do the invoices.

6 MR. GODWIN FROM ALABAMA: Right now it is break 7 time.

4 8 (Recess.]

9 MR. GODWIN FROM ALABAMA: I have a question I 10 wanted to ask Tennessee. I can't remember what it was.

11 Talking about the total labor-intensive. As I understood 12 your answer, for the materials program, it's not that labor-intensive. It's primarily the x-ray program where you spend

( } 13

. 14 a lot of your labor-intensive. Is that correct?

15 MS. SHORT FROM TENNESSEE: There's a lot that goes 16 into it. You all said or a couple of you said that if you l 17 get an application in without an application fee, that you 18 don't process the application. We don't actually process an 19 application without a fee, but I prefe,r that the 20 applications come in without fees so that we can do a little 21 mini-review or fee assessment and then invoice for the 22 current amount.

23 My accounts receivable procedures require that I 24 have an ir, voice against which we receive a check, so that 25 we're noc just getting checks and that we don't know that

/"h 185 V

1 we're going to get. I really get very upset when we get a 2 check that has no basis.

3 MR. GODWIN FROM ALABAMA: We deposit that sucker 4 and cash the check.

5 MS. SHORT FROM TENNESSEE: Our comptroller's 6 requirements are that every single check that comes in be in 7 the bank within 24 hours2.777778e-4 days <br />0.00667 hours <br />3.968254e-5 weeks <br />9.132e-6 months <br />. I was really interested when --

8 was it you that said that you all sometimes leave it in for 9 a week?

10 MR. HILL FROM GEORGIA: Sometimes. We make a trip 11 once a week.

12 MS. SHORT FROM TENNESSEE: Our comptroller would -

13 - we would be removed from the premises if we did that.

14 MR. GODWIN FROM ALABAMA: That's the second thing 15 that our auditor said, that the checks will be deposited 16 within 24 hours2.777778e-4 days <br />0.00667 hours <br />3.968254e-5 weeks <br />9.132e-6 months <br />. They want that interest.

17 Any other questions for Mary? Yes?

18 MR. FRAZEE FROM WASHINGTON: We also cash a check 19 as soon as we can, or at least the Department does. We also 20 have to have the money before-we'll do anything for new 21 applications.

22 Within the Department, there is, of course, our 23 division and, separately, there's a Management Services 24 Section or Unit or whatever they are, and within our 25 Division, the Radioactive Materials Program is the one that O

[%!') 186 1 I will specifically speak to, but there's also an x-ray 2 program, and, of course, the fees are handled separately.

3 Within Management Services, they're very paranoid.

4 They don't trust anybody. You've got to have two people 5 opening checks, handling money at the same time. It's real 6 serious stuff here.

7 So there's both the revenue people who are really 8 the ones who put it in the bank and then the accounts 9 receivable are kind of the bookkeeping and budgeting folks.

10 As you might expect, the first thing that happens 11 with -- and this is following through from a new licensee 12 on. We generate an application package very similar to the  !

one that Ray showed earlier. There is information on how

( ) 13 14 much to pay. Well, it's almost a checklist. You go down l 15 and figure out what your fee is.

16 So occasionally they do make mistakes. There's 17 also information on a small business discount and if they 18 think they'll qualify, they'll sign off and certify that 19 they are a small business. We don't always check. In fact, 20 we don't check that. It's good for 25 percent off of some 21 pretty hefty fees.

22 The licensee presumably will pay the -- will fill 23 out the application and they're instructed to send the 24 application back to us and the money to the revenue folks, 25 but it doesn't always happen that way. Sometimes we get the O

O 1 checks, sometimes we get the license, sometimes we get 187 2 neither.

3 When it's received by the Revenue people, they'll 4 bank it and.then they'll send back a stamped application 5 that says, yes, it's been paid, for to the accountant, who 6 then sort of establishes a billing file, and then finally 7 we'll get it and we'll review it and issue the license and 8 so forth just as everyone else does.

9 Then once it's been issued, we'll send a-10 notification back to our accountant so that he knows that, 11 yes, this is a valid license and to proceed with billing 12 them annually. We bill on the basis of the expiration date 13 of the license. Once a month the accountant will generate a 14 billing list.

15 Now, we found that this is real important. This 16 is the step just before actually sending out the bill. That 17 will be sent back to us to confirm that for this particular 18 license, we do have the right -- he has the right fee 19 category, the right name and amount.

20 In the past, this loop wasn't there and who knows 1

21 what kind of things happened. You'll notice that underneath 22 that I've also included an annual list, and that's because 23 even though we should catch all of them, we found that we 24 weren't catching all of them. There were a couple of 25 licensees that just totally got lost.

O

l i

1 So that's thrown in there to double-check the  !

2- system at least annually. The billing is set 40 days prior 3 to the due date. Now,- the due date happens to be 30 days 4 prior to'the expiration date. So we're really building some 5 time into this. Theoretically,-the licensee is' going to pay.

6 and the instruction is to send it back to the Revenue l 7 Accounting and Revenue Accounting -- well, actually, the  ;

i 8 billing is a remittance. slip. "

9 It says please send this back, and there's some 10 . obvious reasons for that, the major one being that the check 11 is made out and signed by somebody you've never even heard' 12 of. So we need that remittance slip that comes back that

( 13 says, yes, this licensee, we got some money; we don't care 14 who it came from, but we got some money from them, and that 15 is posted by the accountant.

16 Then finally it's sent back to us and we'll keep 17 it in our files,-because just like many of you do, we won't 18 do any work on a license, whether it's an amendment -- well, 19 mostly it's amendments -- without having been paid.

20 Now, the inspectors don't-routinely look for the 4 1

21 payment having been received. They'll go out and do the

~

22 inspection because we figure that's more important than {

23 trying to fool around with trying to go collect money.

24 In passing, the x-ray part of our shop, they have l

l 25 a biannual registration and it will -- and they bill those

i I

+

i

['

V) 1 on a quarterly' basis.

189 p They've found that that produces some 2 really strange spikes in their budgets, some'ups and downs,

)

3 and they're always having problems with the amount of their 4 ' expenditure being either -- well, usually much~1ess or much 5 more than the amount of the revenue and it frustrates 6 managers.

7 So they're going to go to a monthly billing cycle.

8 They're also moving away from what they have, which is,

! 9 again, essentially an outside agency producing the 10 invoicing. It's not only expensive -- well, mostly that's 11 the problem. It's expensive and it's out of their control 12 as far as checking for information accuracy.

13

( Same deal. Now, this is when it doesn't go right.

14 So our accountant, who is hanging onto this information, 15 will generate the first notice that says, hey, you haven't 16 paid, and they'll do that when it's about ten days overdue, 17 which still is 30 days before the expiration date of the 18 license.

19 Now, that's just the expiration date -- I mean, 20 it's the anniversary date of the licensee, but not really 21 expiring. The licensee will receive a Dunning notice at 22 that point and if after 25 days they haven't gotten any 23 money, then they'll notify us.

24 At one point, this was the -- the loop went a 25' couple more times. The accountant would call them up or O

._ . __. . . . . _ . _ _ . . . _ _ _ _ . . _ . _ . . . . . . . _ ._..~ _. _ _.__ _ _ _._.

i i

1 send letters trying to get them to pay and finally would l

2 give up and send it to an accounts -- a collection part of 3 the larger agency we were part of at the time.

l l 4 They'd putts around for a while trying to get i

5 somebody to pay. Eventually, since these were usually l 6 hundred dollar -- well, hundreds of dollars delinquencies, 7 compared to.the cnild welfare and other kinds of accounts l

8 that they were handling, it just wasn't that big a deal to '

9 them.

10 It would go literally a year or so before we'd 11 ever realize or find out that, oh, gee, somebody has not 12 paid. So the change was we.got away from that and

( 13 immediately after this first Dunning notice, they'll send it 14 back to us. What happens is we'll send what is called for 15 administrative purposes "the final notice," and we'll give 16 them 30 days to pay.

17 of course, if they don't pay within the 30 days, 18 our next administrative move is-to issue a suspension. Then 19 they have 30 days to appeal. So this goes on for a while 20 and we're down to about 60 days after the bill was actually 21 due. This is a significant improvement over earlier, the 22 original scheme.

~

23 .After the 30 days, if they don't appeal, then we 24 will -- that's when we start taking action. Like I said 25 earlier this morning, we have, in fact, impounded sources.

p S

(_) l l

1 We haven't had to notify suppliers because at this point, 4

2 it's been portable gauges. We've suspended four or five --

3 we've suspended four. We have one currently in the works 4 and we've gone out and impounded the source or the portable j l

5 gauge from two different licensees.

6 That's labor-intensive trying to track these guys ,

7 down. You've got to catch them. We've been successful. We 8 still have at least one portable gauge sitting in our closet

] 9 waiting to do something with it.

10 There's a lot of problems that we have with this i

11 that could be alleviated if we did it ourselves. Our  !

l 12 drawback in doing that -- it would save us money -- oh, no.

( 13 Actually, it would cost us money to have our person do the 14 work. Right now she does. She is confirming all the 15 information, the billing that goes out, and she could just 16 as easily generate the invoices and everything.

17 So for overall efficiency, it would be better, but i

18 it would end up costing us more money in the sense that I l i

19 would have her time tied up and I would still have to pay 20 for the accounting people downtown. That's because it's all 21 built into that indirect of indirect overhead that they're 22 going to start charging us.

23 So it's a lose-lose from our standpoint. We're 24 going to continue to use them even though they're not real 25 efficient and we do have problems from time to time. The

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

l 2

I system is better than it used to be, but the alternative is 2 taking on the responsibility and still basically not saving 3 us any money.

i' 4 MR. GODWIN FROM ALABAMA: Question. . Terry, would 5 you end up collecting more money, though, if you did it 6- rather than them not collecting? Even though it cost you I 7 more, would you have a net gain?

l 8 MR. FRAZEE FROM WASHINGTON: No. We're actually 9 doing very good as far as collecting the amount of money 10 that's due us, particular with this scheme, because we end

{ 11 up going out after them. It's costing us. money in terms of 4

12 our collection efforts, but we're getting the money that we 4

f 13 need, with the exception of the four or five licensees.

14 MR. GODWIN FROM ALABAMA: How much time do you 15 estimate is taken out of your program to do this collection?

i 16 MR. FRAZEE FROM WASHINGTON: It's been literally i

i 17 thousands of hours over the last ten years.

18 MR. GODWIN FROM ALABAMA: In a given year.

19 MR. FRAZEE FROM WASHINGTON: In a given year?

20 MR. GODWIN FROM ALABAMA: This year. For the past 21 year, let's say.

22 MR. FRAZEE FROM WASHINGTON: In the past year, 23 there have been two licenses up for suspension. One is 24 still ongoing or we're still into it. Round numbers of 40-25 50 hours5.787037e-4 days <br />0.0139 hours <br />8.267196e-5 weeks <br />1.9025e-5 months <br /> total time. )

4

i l

l

[D 193

\-) \

1 MR. GODWIN FROM ALABAMA: Ed Fuente, Mississippi?

2 MR. FUENTE FROM MISSISSIPPI: Ed Fuente from 3 Mississippi. We're not that different than some of the ones  :

4 I've already heard. We generate our own invoices. We l l

5 receive the checks. We process the checks. Then we turn 6 our checks over to our finance people for_ deposit.

i 7 Currently, we're using clerical staff to do this. I 8 However, I'm attempting to get a job classification like 9 Accounting Auditing Technician to do the billing for us. In I 1

10 Missisrippi, it's not a full-time job. So this person would i 11 also have responsibilities for data management.

12 We do have a computer. program inhouse. We charge for any and everything, for the specific license, general

) 13 14 license, x-ray registration. I mentioned earlier 15 installers, maintenance people on x-ray equipment, 16 consultants, you name it, and we charge them a fee.

17 Recently or within the last couple of years, we 18 even started charging fees for tinning beds and booths, 19 tinning facilities in addition to our other licensees and 20 registrants. The only difference being in the tinning, the 21 tinning facilities are county environmentalists. You may 22 call them county sanitariums. They do the inspection of 23 these facilities, whereas all the other licensing and x-ray 24 registrations, our health physics staffs do the inspections.

25 We send out an initial invoice and in

/~%

U

O 194 V

1 approximately 45 days, we'll send out a second notice. In 2 an additional 45 days, we'll send out a third notice. It 3 does take some telephone calls and occasionally it will take 4 some letters from me and, if necessary, from the health 5 officer, before I would turn it over to the Attorney 6 General's Office for either a letter or telephone calls.

7 The attorneys that are assigned to our agency from 8 the Attorney General's Office have even called on some of 9 these registrants. That's where the problems lie. ,

10 MR. GODWIN FROM ALABAMA: How about the materials 11 program? Do you have the same problem in materials?

12 MR. FUENTE FROM MISSISSIPPI: No. These people pay. We haven't really had any problem with materials.

I )D

%. 13 14 It's just the registrants we're having a problem with.

15 Occasionally, the Assistant Attorney General, if he's in the 16 area in that particular town or city, he'll call on them.

17 Usually when he introduces himself, they write a check.

18 But I don't depend on our health physics staff to 19 collect this money. I think they have a burden as it is to 20 go out and inspect these registrants and the licensees, and 21 I don't require them to say you owe us so many dollars and 22 what have you. I leave that up to the attorneys if it needs 23 to be collected. l 24 That's more or less the way it operates.

25 MR. GODWIN FROM ALABAMA: So you have a computer O

1 1

. . _ . . . . . . _ . - . __. - _ _ - _ . . _ . _ . . . - _ . _ _ ..- _ . . _ _ _ _ _ _ . . . . . - _ . ~ . . _ . .

i~

r j IT 195

! (_/

1 1 program, do you?

2 MR. FUENTE: Yes.

j 3 MR. GODWIN FROM ALABAMA: Questions? Dan, I

4 Florida?-

5_ MR. NASH FROM FLORIDA: Dan Nash, Florida. I'll 6 answer _the third question first answer he asked. As far as l

l! 7 generating invoices, this is done by computer until two l i

8 months ago. We had an old special purpose computer that had i

! 9 some tracking and some selection.

10 I think it went back to shortly after the abacus.

11' But we'now have a DOS-driven database program. The 12 computer, the licensees are categoriz.ed, a database of a

( ) 13 license number by category by priority by the date of issue.

14 I have some slides of the databases and the output, if i 15 you're interested, but it's probably pretty common. l 16 But two months prior to the due date, a notice is 17 automatically generated to the licensee that his fees are ]

18 due. If it hasn't been paid and entered into the computer, 19 then one month after the licensee gets a second notice.

20 And then one month after that if it hasn't been 21 paid and if the_ computer hasn't been told any different, it

-22 generates a letter which says, "This letter is to notify you 23 that actions will be taken to revoke your radioactive 24 materials license if your annual and reclamation fee is not 25 received in this office by 14 days after the date this is O

._ __ _ _ _ _ _ _ _ _ _ _ _ _ _ . _ . . _ _ . _ - _ _ _ . _ _ _ _ _ _ _ ., _ ._. __ ._ ~. _ >__

l 1

). '

1 written."

2- "Should your license be revoked, proof of 3 disposition of all radioactive materials in your possession 4 to-a licensed recipient will be required.".

5 If this doesn't get the thing paid, the next thing 6 is an administrative complaint which says that.the license 7 will be revoked upon them getting rid of radioactive 8 material; that if that step is taken, they have 30 days to 9 get rid of that material or they.will fined $200 a day.

10 If that doesn't happen, then it goes to an 11 administrative complaint signed by the Secretary of HRS, 12 which says basically the same thing. If it goes beyond r

(_ 13 that, then it gets into the hands of the attorneys. I 14 figured that if it's all within my lifetime, I'll be lucky.

15 But it's very fortunate we just have very,-very 16 few that get to that stage. This computer program also will

~

17 assign the inspection dates. We turn out an annual and a 18 quarterly and a monthly report to the field units of the ,

l 19 inspections which are due.

20 If it's a new license, the computer will assign a 21- six-month inspection-date after issue. The computer will 22 also generate, six months prior to the expiration date, a 23 notice that renewal is due. It will generate another one 24 three months ahead if we don't get anything, and it will j 25 generate another one two months prior to the expiration

i 197 J

1 date.

2 If a' check comes in, it's not sent back unless it 3 maybe wasn't signed or something. But it's cashed and, once 4 cashed, there is no refund unless it's an overpayment. I 5 don't care what it's for. Once we have it, there is no 6 refund unless he has overpaid.

7 Strangely, by law, we have to fill out a 8 handwritten log of checks received. Then this log goes to a

! 9 second person who writes the receipts for this. Then it's 4 10 turned ove:r to the accounting section.

11 MR. GODWIN FROM ALABAMA: That's i:.: the Florida 12 code?

O)

(_ 13 MR. NASH FROM FLORIDA: It's in -- I don't know 14 whether it's law or code or what. It's not anything having 15 to do with 404, which is the statuts- or 10D91, which is 16 the rule. It has to do with some other parts of state law.

17 Followup invoices, as I said, if we don't hear 18 from the renewal or fees, then automatically will be 19 generated a second and a third notice.

l 20 For issuance of licenses after fees are paid, of 21 course, we send an application and an application guideline 22 to interested licensees. The application fee, if it doesn't 23 accompany the application, no action whatsoever is taken.

24 He's notified of that.

i 25 The license, though, is delivered before we get

d 8

,(/ 198 1 the first annual fee, but the annual fee is due within 60 2 days. Of course, if he doesn't pay within that 60 days,

] 3 then we get into the delinquent fee notices and escalated t

4 enforcement.

5 The license is prepared and is hand-delivered with 6 a letter of delivery to the licensee, and also a letter back 7 to us that the license was delivered. We haven't'had any l 8 problems really with collecting license fees, delinquents,

9 but very, very few that just completely don't pay.

f 10 MR. GODWIN FROM ALABAMA: Questions?

i

. 11 MR. FUENTE FROM MISSISSIPPI: Fuente from 12 Mississippi. I'm sure all of us receive these little nasty 13 letters from some of these people occasionally, talking 14 about taxation. I see some of you nodding your head yes.

15 That wasn't a question. That was just a comment. I'm 16 sorry. Go ahead.

17 MR. NASH FROM FLORIDA: And telephone calls.

18 MS. SHORT FROM TENNESSEE: Short from Tennessee.

i 19 You said that you all hand-deliver your licenses.

20 MR. NASH FROM FLORIDA: All new licenses are hand-21_ delivered either by a pre-license inspector or by a license 22 evaluator. If it's a complicated license, then we will do a 23 pre-license -- a radiopharmacy, for instance, we will go 24 down and check it out before we even issue the license.

25 But other licenses are hand-delivered by an O

/"N b 199 1 inspector. That's the time to talk to him about fees and 2 any questions you may have. Then within six months we will 3 do'a formal inspection.

4 MS. SHORT FROM TENNESSEE: Does that seem to work 5 well? Deas that develop goodwill?

6 MR. NASH FROM FLORIDA: I think so. I really 7 think it does.

8 MS. SHORT FROM TENNESSEE: That's interesting.

9 MR. FRAZEE FROM WASHINGTON: Frazee from 10 Washington. We also hand-deliver all new licenses and 11 renewr4 s and any license amendments that are really bizarre.

12 MS. SHORT FROM TENNESSEE: Is that not terribly O

k) 13 m labor-intensive?

14 MR. FRAZEE FROM WASHINGTON: That is labor-15 intensive, but the benefits are worth it. We do have a much 16 better rapport with licensees. They're much more willing to' 17 talk to us and communicate, come to us first. Of course, we 18 get them off -- well, the theory is we get them off to the 19 right start by telling them exactly what to expect and what 20 the license really says, particularly for the new licenses.

21 MS. SHORT FROM TENNESSEE: So for Florida it's new 22 licenses and Washington it's new licenses, renewals and 23 bizarre ramendments.

24 MR. NASH FROM FLORIDA: If we would have a very

, 25 complicated renewal, we may do a pre-license type visit with 4

I

l 1

200 1 them. But the new license -- what do you average, about 2 eight a month? It's not a big deal..

3 MR. FUENTE FROM MISSISSIPPI: . Comment. Fuente, 4 Mississippi. Mary Helen, I'm somewhat surprised that Dick 5 Woodruff hasn't mentioned this to Tennessee on his visits.

6 MS. SHORT FROM TENNESSEE: If he has, I was not in I 7 the room when he did.

8 MR. GODWIN FROM ALABAMA: Other questions?

9 [No response.] I 10 MR. BAILEY FROM CALIFORNIA: Ed Bailey from 11 California. Are you ready to roll with it? Do a show-and-12 tell for you?

13 I want to describe, since we have1so many systems, 14 we have -- we don't have a system. For x-ray facilities, we 15 have one system. For licentiates we have another system, 16 and for radioactive materials we have a third system.

17 We're going to start charging for general 18 licensees and there will be a different system and 19 mammography is going to be a different system still. And we 20 do all this with great pride, so no one will know what's 21 going on.

22 Basically, for x-ray facilities, an invoice is 23- generated 60 days in advance of " hen it's due. If the money 24 comes in, it's received by account 1.7 and accounting credits 25 that person's account. All of this is done essentially by

1 i

1 1

() 201 1l . the mainframe computer.

2 I might mention that we do on the average of 4,000 3 bills a month. However, x-ray at'the present time are all 4 done once every.two years. So the 20-how-many-ever-thousand I

5 there are, 27,000 facilities are all done at one' time.

6 - Now, that comes as a great shock to'our accounting

] 7 and~ mail room system because there are about five other 4

i 8' programs in health. services, some of-which have more people i 9 than this which also bill at that same time.

10 MR. PARKER: The 27,000 facilities or tubes?

11 MR. BAILEY FROM CALIFORNIA

Facilities.

12 MR. PARKER: How many tubes do you have?

('

\m)T 13 MR. BAILEY FROM CALIFORNIA: Multiply that by 14 about two-and-a-half and you get -- I don't know.

15 MR. PARKER: Okay.

16 MR. BAILEY FROM CALIFORNIA: We do bill by tube, 17 Each tube gets charged. We count tubes and charge them. If 18 they do not pay, then a second notice is sent out in about

19 60 days. If it's paid, it goes into accounting and they're 20 shown as active.

21 At the present time, if they do not pay, no i

22 aggressive collection efforts are taken. Footnote to that.

23 - When I went to California in July of 1989, within two weeks 24 - after I got there, I said how much did you collect in fees 4 25 last year. June of 1990, I got an answer. California was a j

~~wp, , - , - - se7 - , _ , _ _ y

-em .- - - , ,

i 202 1 looney-goosy on how much money came in, which account;it. l l

2 went into, whatever. 1 3 I couldn't believe it, having come'from Texas j 4 where the actual pages that you type the license on, each j 5 had a serial number and'you had to account for each page of 6 licensing paper.  !

I l . .

7 This is the extreme situationLand we're working l

8 now to try to generate a better system for x-ray, and we'll 9 be-doing that hopefully with our mammography system, which-l 10 now' requires free registration in California. If accounting l

L 11 and data processing can't do it, we're asking for permission

, 12 to go.outside and get a professional billingfcompany to do-13- the billing.

14 Most'of you all receive bills every month. I 15 would be willing to bet that roughly 90 percent of them are l 16 correct. Seldom do you find error. Companies, little i

17 companies somehow manage to get a bill out to you within 30 18 days, usually within about five days of your last purchase 19 and so forth, and it comes back in.

l 20 Amazing how they manage to do it. And you send in i 21 a check and they even credit it to your account. The 22 government doesn't work that way sometimes.

23 Unlike many states that do eramine or test x-ray l

)

I 24 techs, in addition to the x-ray techs, we also do the  !

25 doctors. Every doctor in California takes an exam before i

l l

i 203 1 they are granted an operator and supervisors permit. Here, l 2 again, the invoices are mailed by data processing, which is 3 called Data Systems Branch. The invoice is generated by 4 mainframe, the Health Applications Licensing System, the HAL l 5 System.

6 Each of them is presently billed for two years. I 7 think that should be 34,000 techs and limited permits, and 8 24,000 licentiates, licentiates being those that are 9 doctors. The difference from the other system is that these 10 go each month. So that there are roughly -- whatever - 11 something thousand -- about 2,000 a month, a little over i

12 2,000 a month of these go out each month. I 13 They're billed for two years at a time. The j 14 renewals come in, and I will show you some of the neat 15 things that they have associated with the HAL system.

16 They're received by accounting and they load the information l 17 in the computer and credit the account -- this is pretty 18 much done automatically -- and it generates a new 19 certificate.

20 If they haven't paid in 60 days, then a second 21 invoice is sent. If it's paid, fine, it goes through the 22 whole thing. If they don't pay, then we forget them. They 23 are no longer licensed by California to do x-ray technology.

24 They cannot supervise an x-ray tech if they are a doctor.

25 We don't really care whether they have that license or not.

l l

,(

204 l

1 It's just like a driver's license.

2 Here's a copy of the bill that goes out. Here's 3- the top of the pace all the way to the bottom of the page.

4 Basically, the top part of the letter says you owe us money.

l 5 One thing you may notice. Everything goes to a different 6 address. I could not believe it.

7 We've got some that go to street addresses, some l 8 that go to Post Offices boxes, two different street 9 addresses now since we've moved. We've got three street 10 addresses. But by and large the money ends up coming into 11 the department.

12 Here, the instructions are you tear off this

\ 13 bottom thing and return it with your check. In accounting, 14 where they open these, they take the bottom sheet and the 15 check and they've got a fancy-dancy machine there that reads l 16 this number and credits that account automatically.

17 The only problem is that quite often a hospital or I

! 18 something or other will pay fees for more than one person, 19 and the system then gets all screwed up because they'll 20 return three or four of these with one check. So that 21 messes it up.

I 22 I enjoyed the comments Mary Helen said about they l

l 23 have to deposit the checks within one day. The Department l

, 24 of Health Services in California last year had 54,000 checks unprocessed at one point. They were three months behind in O 25 ,

l i

( 205 1 processing checks. They had not even taken them out of the 2 envelopes. So those are the sums of the kinds of problems 3 we have.

4 As a result of that, however, we were able to 5 convirice accounting, look, we really care whether those 1

6 people get credited because those checks included people who l 7 went in to take the test, people who wanted to renew their  !

8 certificates, license fees, a whole variety of different l

9 things. And these people were being delayed three months. -

10 In California, if you're going to supervise in an 3 l

11 x-ray department or take x-rays, you must have your  ;

1 12 certificate on the walls, and the hospitals were phoning up l 13 when the people's certificates were expiring.

l 14 Here is basically what happens, comes out the l 15 other end of that system. A letter comes out. You'll 16 notice this is a different address from what we had 17- previously, just to keep you confused.

18 And you get a certificate which you can tear off 19 the bottom of there, and it tells what you're licensed for.

20 This happens to be nuclear medicine technologist, which we 21 also test and we've got about 1,500 of these people.

22 They're on the same system.

l l 23 MS. SHORT FROM TENNESSEE: Is that the real Daisy l

l 24 Duck?

l 25 MR. BAILEY FROM CALIFORNIA: Yes. And we've got 1

l

p 206 1 Minnie Mouse. And those are the intelligent ones. Now, all 2 of those systems were handled essentially by data processing 3 and accounting and so forth, except that in order to take 4 the test, we've short-circuited the system.

5 We went and put our address, our little local 6 address on the envelopes so that the checks to take the test 7 came in to us. And then we would take them off and schedule 8 the exams, and we'd schedule about 600 exams a month. So 9 those people were very happy when they got their exam 10 schedules speeded up from the three months that they were 11 previously at.

12 Materials licensees, we have an annual fee that 13 includes everything. As I mentioned earlier, it's a screwy 14 system, based on millicuries that you possess. We mail the 15 bills 60 days in advance. We actually mail them ourselves.

16 We generate the invoice on a PC.

17 I might mention that this is a fairly new 18 invention. Before, when I first got there, they were just 19 implementing this new program. Before that, they were hand-20 typed out on a typewriter. We presently bill for one year.

21 There are about 2,400 to 2,500 licensees. We have one lady 22 who generates all the bills, all the second notices, posts 23 them, updates the computer, and types compliance letters for 24 two inspectors.

(- 25 She has four licensees who have not paid their V

. .- . . = _ . . - .-

! e']

l (_/ 207 1 1991 fees. One of those ision a compliance order, ISOVAC, 2 because they had decided since their license had expired and 3 they were not in time for renewal really, that.they didn't 4 owe a license fee for the previous year. Now, your logic 5 may be able to figure that out.

6 They continue to operate under some sort of wierd 7 strange letter that one of our people issued, but they've 8 decided they did not have a valid license; therefore, they 9 did not owe a licensee fee.

10 MR. FRAZEE FROM WASHINGTON: These were all 11 generated at one point in time?

12 MR. BAILEY FROM CALIFORNIA: No. These are billed 13 each month, the anniversary of the issuance date. About 200 i

14 a month.

1 15 If we go through the second notice, which is 16 issued 60 days out, and they don't respond, then we issue a 17 notice of violation, the Inspection Agency issues a notice 18 of violation. When we say Inspection Agency, we mean either l 19 L.A. County, San Diego County, Orange County, Rad Health, or 20 Headquarters.

21 We have now been advised that we may take these 22 people to small claims court and we have to go in and do it 23 ourselves. The AG won't go to small claims court for us, 24 and there are all kind of Mickey Mouse rules that you have l 25 to abide by. Basically, you can't go for more than $5,000,

1 I

(" \

.( 208 1 I think it is. You can't do more than $25,000 worth of 2 business in small claims court per year. There's all kinds j 3 of Mickey Mouse rules. I l

4 However, each one of us around the room can take ]

i 5 in $25,000 worth for the agency. It's a really strange i 1

6 system. But right now, another thing I might mention. When 7 I first got there, another example of how loosey-goosy they 8 were with money.

9 After two billing periods, the computer lost track 10 of whether or not you had paid the third one back or not.

11 So they have no idea how much money was collected before 12 1989 basically or how much was not paid.

(~h

(_) 13 Here's a typical bill that goes out. This is an 14 actual bill. You'll notice-the different address to mail 15 the money to.

16 MR. GODWIN FROM ALABAMA: Who signs that?  ;

i 17 MR. BAILEY FROM CALIFORNIA: Peggy. Peggy does j l

18 all of these. She's quite efficient. She loves collecting 19 money. It's her chance to get even with the world.

20 Now, one of the things that you may want to look 21 into, particularly if you're located with the Health 22 Department, is one of the things we're doing now, is l 23 exploring with what we call MEDICAL, which is your Medicare l

l 24 delivery group.

l l <s 25 We have a group called Audits and Investigations.

i

l i

l

) 209 J

l 1 We've been meeting with them for quite some time to sort of 2 ' improve communications after we did some radioactive l

3 materials inspections in nuclear medicine facilities and 4 found out that they were not -- nuclear medicine facilities 1 5 were not complying with the general hospital licensing code 6 regarding infection control, the gross compared to the rest 7 of the hospital.

8 We started meeting with.them and then we came up 9 with the idea that why are we paying Medicare, MEDICAL,.

10 whatever you want to call it, to facilities that are not 11 registered with us or who have x-ray techs or doctors who I 12 are not certified by the state.

tQ

(-) 13 So we're now implementing a. system for audit l

14 exceptions on those facilities. I'll give you an example.  !

15 If you happened to watch Prime Time the other day, when the 16 doctor in L.A. was drilled about the film, we got him to 17 check. MEDICAL, which is the Medicare-type thing in 18 California, paid him, on his social security number, l 19 $220,000 in 1991.

20 We don't know -- we haven't been able to trace 21 down, since he also has about eight other business names, l 22 how much money that man was actually paid for not doing his 23 job. So we're looking at going in x-ray and nuclear 24 medicine, if possible -- we don't really have much of a i

s 25 problem -- to get audit exceptions from them and actually l

CE) '

1- take the money away from them.

2 MR. GODWIN FROM ALABAMA: Was he. licensed by you 3 all?.

4 MR. BAILEY FROM CALIFORNIA: Yes. This is sort of 5 a running trend -- well, you can't read that small print, 6 but I'can. The blue is the average fee over a.three-year 7 period, the average annual fee. Then that line is where our 8 projection is going this year. You'll notice this huge jump 9 at the end of the year, and that's caused by the billing at 10 the end of our -- in May, essentially, of all the x-ray 11 facilities. You we get a huge jump at the end of the year.

12 One of the things which is coming up-now which the O

k_) ' 13 accounting people are toying with is we're going to 14 hopefully have a special fund which will go into effect 15 January first. Well, we're supposed to bill in May for nur 16 x-ray for two years. We're not going to bill for that whole 17 two years, because if we did, we'd lose all of that income.

18 So we've got to figure out a way to break down billing and 19 have it only for six months or whateve.r, so that we don't 20 essentially bill and put it in the general fund for two 21 years.

22 I just won the prize for the worst slide. I think l 23 that slide is actually pretty good, if you don't look at the 24 numbers at the bottom. l 25 I think that's about all I wanted to say about our O l l

t

( 211 1 -- but that's basically how we do it. l 2 MR. GODWIN FROM ALABAMA: Questions? My good 3 friend from Ohio.

4 MR. WALKER FROM OHIO: Tim Walker from Ohio.

5 Amazingly enough, I think this is one area, at least 6 Questions 2 and 3, that we're not so much different than the 7 rest of you. We have about 10,000 x-ray facilities and 8 about 285 radioactive materials registrants. Those are both 9 biannual fees. It's kept track of through a VAX system, 10 which is a mainframe computer, a VAX variety, that's the 11 computer backup to the paper copies, if you will.

12 It is also capable of generating the invoices. X-(~T

(_) 13 ray registrations are billed consistently over 12 months q 14 every year. For some strange reason, radioactive materials 15 -registrants are only done in July and August. I'm not sure 16 why. No one has ever been able to give me a decent 17 explanation on that. But as long as we get paid, it's fine.

18 Right now we have 1.5 FTEs devoted to doing this.

19 It's an administrative assistant and half a secretary, if 20 you will. Invoices are sent out 60 days prior to the 21 expiration. If payment isn't received in that time, a 22 second notice is sent out with a stronger letter, indicating 23 that the Director may issue an adjudication order to suspend 24 or revoke your legislation.

t 25 Like I said, it's very similar to everything else

On 212

\/

1 that everybody else does. Thirty days after that, a third 2 letter is sent indicating that the matter will be turned 3 over to the Attorney General's Office.

4 As far as radioactive materials, we have no 5 outstanding payments to be made. I can't address x-ray. I 6 know x-ray has a lot of deadbeats. That brings to mind 7 something else that occurred to me. I think because people 8 in the radioactive materials arena are so used to the 9 -regulatory format that's been going on for a number of 10 years, they're more inclined to go with the program, pay 11 their bills and meet their requirements.

12 The x-ray folks are resistant and also what just 13 occurred to me is that radon people, which we have just 14 recently started licensing, fall into that same category.

15 We had a gentleman give me the raspberries over the phone 16 and told me that, hey, go ahead and do whatever you want 17 because for this piddly amount, the Attorney General's 18 Office is not going to follow up, and, if they get to me, 19 it's going to be three or four years.

20 And the damn thing is he's absolutely right. But 21 that's just a little editorial comment I'd like to throw in.

22 Again, as with everyone else, we don't take any action on 23 anything if people don't pay.

24 MR. PARIS FROM OREGON: Do you threaten them?

r~g 25 MR. WALKER FROM OHIO: The letters get fairly b

l l

[ I

) 213 1 threatening. The adjudication order, the turning it over to i l

2 the Attorney General's Office, I consider that to be fairly 3 threatening. Whether it carries any weight with them or 4 not, I don't know.

f 5 MR. BAILEY-FROM CALIFORNIA: Ed Bailey from 6 California. I'd like to say one thing I didn't say. We do, 7 I guess like Mary Ellen said, we prefer on an application to 8 get the application in and then we bill them on an invoice.

9 Invariably, with our screwed up millicurie system, they send )

i 10 in the wrong amount of money or they have last year's un-l 11 inflated cost figure there and we have to bill them for 12 three cents or something, j 13 MR.~ WALKER FROM OHIO: Tim Walker, Ohio. With l 14 regard to the comment you made about the 285, whatever 15 outstanding checks. We do, we are required to turn those 16 checks in every day.

17 MR. HOKEL FROM IOWA: Bruce Hokel, Iowa. I just l

l 18 want to know how much it is per month in California?

19 MR. BAILEY FROM CALIFORNIA: You don't want me to 20 go through the whole system. For x-ray machines, there is a i 21 cap in materials, and right now it's about $4,000 per i 22 license.

23 MR. HOKEL FROM IOWA: Like a dollar per 24 millicurie?

(-

\_-

25 MR. BAILEY FROM CALIFORNIA: It starts out one to

-( 214 1 ten millicuries, and ten to 50 and goes on up. It does have 2 a cap. However, x-ray does not have a cap. So that if you 3 have 9,000 machines you pay the $143 or whatever per 4 machine.

i 5 MR. HOKEL FROM IOWA: What about an MEV or 6 accelerator?

7 MR. BAILEY FROM CALIFORNIA: No. It does require 8 preregistration, though, as opposed to notify us 30 days 9 after you get it.

10 MR. GODWIN FROM ALABAMA: Any more questions?

11 MR. FLOYD'FROM NEW MEXICO: Floyd, New Mexico.

12 Mine's'real easy and short. Since we don't have a fee 13 system, we don't have a fee collection or processing system.

14 But if we_do implement one, I'm getting a lot of good ideas.

15 MR. GODWIN FROM ALABAMA: I assume there are no l 16 questions.

17 MR. HALLISEY FROM MASSACHUSETTS: I have to go 18 through a few slides and explanation of what we do in 19 Massachusetts, because Terry Parker, the moderator, insisted 20 that I do this. So I'm not going to disappoint him and let 21 him down.

22 We have -- I mentioned earlier that I found, much 23 to my chagrin, back in 1980 when I came over to the l 24 Department, that the programs themselves are expected to not l

lgs 25 only establish the fee, determine the amount, but also to i

I

) 215 l 1 collect it and post the money and put it in the bank and 2 send back receipts and' certificates and licenses and 3 everything else.

l 4 I can do far to one better. You talk about your l \

! 5 statute. When I got there in 1980-81, about the only thing l 6 they were collecting fees for was like nursing homes and I

! 7 EMTs and a couple of other things. The process in the state l

! I 8 was that the individual was sent a typewritten bill, which 9 was typewritten on -- remember those things called l 1 10 typewriters -- they used to do that.

11 The person would send the check back with the .

i l

,_ 12 bill. The person receiving it would open it, then mark on J k_- 13 the associated piece of paper the check number that they had l 14 received it, send it to a second person who would then sit I

l l 15 and fill out a receipt book. Remember those receipt books? l l

16 If you ever lived in a home or in a boarding house or l 17 something and you paid ten bucks a week and they wrote out a 18 receipt and the yellow copy they kept and the white one they 19 gave to you. l l 20 This person would actually sit there and copy from 21 the bill the complete name and address and the amount of the l

22 fee. Two copies of these then would be attached to the 23 check, rolled around the check, and then that would be sent l l

24 separately down to another office in another building where l l

25 a third personnel, this is one little $15 check, there's

]

I i

i-216 l

1 four people already that have touched this, a third person ,

2 then would take, unroll the receipt, look at the check, 3 determine that the amount on the check was the same as the 4 amount on the receipt, and then hand-copy, again, the name 5 and address onto another piece of paper in a log book.

6 MR. NASH FROM FLORIDA: Well, I resemble that 7 remark because that's exactly what we do.

8 MR. HALLISEY FROM MASSACHUSETTS: They have these 9 . things called computers. Even in 1980, they had them then.

10' I said if I'm going to set up a system, I'm going to set up 11 a computer-based system to do this. If I'm going to go 12 through all the trouble of tying up our staff, and we went

.. (~s t

(m 13 to school and all to learn how to be health physicists and 14 higher things, to do accounting,.that I want to get more out 15 of it, so I wanted to build a whole management information 16 system.

17 As I will show you in a minute, I got to that 18 point where I had everything -- that I was quite pleased, 19 with one exception -- these God damned receipt books. And I 20 still had to have people sit there and hand-copy out these 21 names, and legibly. Not just anyone can write nice. And I 22 kept asking the question, and they'd say, oh, it's a law, 23 it's a law.

l 24 I went so far as to go through the auditors up to 25 the Attorney General's Office, and, in fact, it was on the

~

l

1 217 1 books, when they didn't have computers, that you had to keep 2 a written record of a receipt. But now with computer 3 systems, our Attorney General ruled that the computer-based 4 printout was sufficient to satisfy that and eliminate them.

5 So we have eliminated using hundreds of thousands 6 of receipt books throughout the Department of Health because 7 it's all in a computer-based system.

8 So you may want to explore it because the law was 9 there before they had this other ability to do that. By the 10 way, the company, and there was only one company that made 11 these receipt books, is out of business now. So I do feel 12 badly about that aspect, but you can imagine it was a rather O(_/ 13 lucrative business.

14 As I said, we were told that we would have to 15 collect all the fees, do all the checks, chase after people 16 that bounced their checks and people that didn't pay, 17 etcetera, and set up then an entire process.

18 So to do that, I started out in the x-ray 19 registration program, and we have that and the RT licensing 20 program, and I intended to then carry this right into the 21 agreement states program and the licensing. And basically 22 there are a number of database programs available. We 23 happen to use Dbase 4 right now. We started out using Dbase 24 3 and developing some type of a management information 25 system; not only the name and address and the type of V

() 218 i i

i facility and the types of tubes they had, medical or dental, 1 2 etcetera, but also put in the results of their last two 3 inspections and put in there a system where they call them 4 up for reinspection on some type of a timely basis.

5 All of this you can build right in and then pop I

6 out at the beginning of the quarter for each of your l 7 inspectors a hand-print -- a computer-driven list that says 8 who needs to be inspected and break it into categories at 9 all. Plus, then, before you go out, rather than going back 10 in the files and looking up all of this extra paperwork, you 11 can look into the computer, l

12 And everyone on the staff has learned how to use l r~ '

(_)g 13 the computer and how to use the system, and you can look up 14 and see what was wrong at the last inspection and the 15 previous inspection. We only save the last three 16 inspections and then when you put the fourth one in, it 17 kicks the earliest one out.

18 MR. NASH FROM FLORIDA: You're talking about 19 inspection reports are in the computer.

20 MR. HALLISEY FROM MASSACHUSETTS: The inspection 21 report information, not the entire information.

22 MR. NASH FROM FLORIDA: Just the deficiency 23 letter.

24 MR. HALLISEY FROM MASSACHUSETTS: Yes. And 25 principal findings. We have them in categories. Right. So

O 219 1 basically, just for a couple -- a few of you that perhaps 2 aren't using this type, there are many of them available.

3 This-is the Dbase 4, which is really a menu-driven PC 4 computer system. Any idiot can use it. I'm doing it. It 5 has the ability in the first -- it's merely menu-driven.

6 The furthest over on the left is simply your 7 database files. You can set up database files in different 8 categories. In here I have the first one as our applicants, 9 people who are applying to take the RT exam. The next one 10 is nothing but a database file of names and addresses of 11 people who are interested in our mission regulations, where 12 we have to mail them out a number of-things.

13 The next three are just simply exams, RT exams by j 14 whether it's the July or the March or the October exam. We l 15 also, the very top one, of course, is the licensing database 16 file for the RT licensing.

17 The second category over here is queries. You can l

18 then develop, using these database files, different types of 19 queries. If you just want to count how many people have 20 dental x-ray machines or how many people -- how many 21 dentists have three tubes and how many have two, you can do 22 any type of a query here and it will just simply pop you out 23 the amount of information.

24 If you look further down, we're talking about billings. You can see there's a not-paid query there. You

~} 2 5 J

/~'N

(_) 220 1

1 can go right through your database in two minutes and find 1 2 out -- and get a printout or new bills of everyone who 1

3 hasn't paid to date. l 1

4 There is the ability to do forms. We don't have l 5 any this particular catalogue. Also, to write reports and i l

6 type reports. When we enter in a check has been paid into 7 the system against that person's ID number, etcetera, then 8 that automatically engenders a report to accompany the 9 checks to go into the bank.

I 10 We have to do the depositing and the deposit 11 reports. The printout reports are sufficient for depositing 12 purposes into the general funds. And then further over we

/~

k._)T13 have the ability to make labels, because you don't want to 14 handwrite the names and addresses. Otherwise, you're 15 defeating the purpose. You can also at the same time just 16 pump out the labels, whether it's the labels or the people 17 that haven't paid or the labels of people who took the March 18 exam or whatever.

19 It's a very simple menu-driven type program to do

)

20 this. We basically have two different types of programs we  ;

21 do. The first one was our x-ray registration program. This ;

22 is actually the three forms for registering x-ray equipment 23 in the state.

i 24 If you look at the top one, going down to the line where it says signature, title and date, that's the original

(~} 25 V

l l

l

- - .. . - - . -. = .. -. - .. .. .

() 221 1 application which obtains the information, the name and the 2 address of the responsible person, whether they have NRC or 3 non-material, the type of facility they are and the number 4 of tubes.

5 That then is assignec a number into the system and 6 that engenders a bill, which is the next category. Once it 7 is in the database, these bills can be pumped out 8 automatically. We spread them out over the year by category 9 so that we don't get them all at once. We do it on an 10 annual basis.

1 11 We have somewhere between 5,500 and 6,000 12 facilities, about 10,000 tubes. The cheapest is $15 for

.[)

13 dental to $25 for chiropractors and medical, and $30 for

(_/

14 hospitals, with a $990 cap on hospitals. If they have more 15 than that many x-ray machines, they get them for free.

16 The reason for that is our inspection process in a j

17 hospital is that we only do eight x-ray units each 18 inspection each year. So it's every four years we get to 19 see 32 of them, the 32 that they pay for. And if it's more 20 than that, then we expect them to have reports from their 21 health physicist, etcetera.

A 22 So then this bill simply goes out with this 23 invoice. If you notice the boxes, then, the names and 24 address is there, so they fit in windowed envelopes, so you 25 don't have to do labels, and they fit actually in there.

/~s k m 222 1 The person returns the top with the check. The 2 check is then printed right back into the computer and we 3 have a number of these and different people can do them.

4 All of our staff is bonded to handle the material. We 5 haven't got the pressure that some people have to get the 6 checks into the bank within a 24-hour period or something, 7 although we generally deposit them as quickly as possible.

8 If not, they are locked up overnight.

9 Then once that person has paid, then the computer 10 actually spits out a registration card which needs to be 11 posted next to the x-ray unit in clear visibility. This, 12 again, as I said, is done on an annual basis.

13 Another program which is about 5,400'RT, 14 radiological technologists licensing, which went in effect 15 in 1987, we use the same type of a program. As you see, we 16 also built a data information system right into the database 17 that's also generating the bills.

18 So we're not losing a lot. We get a lot of other 19 good information on those individuals, including their 20 present place of employment, their previous place of 21 employment, the date they took the qualifying exam, how they 22 qualified to become a licensed RT, the type of license 23 that's held, and then there are categories down at the 24 bottom, if you look closely, if the license was ever revoked

( g 25 for any particular reason.

V

223 l 1 Then interspersed in there is when they were 2 billed and when the payment was received and the billing 3 process associated with that.

4 We have about 44 different pieces of information l

5 and we then have a good database on each of the individuals, I I

6 -plus we.also have the ability to engender reports, as I I 7 said, if you wanted to just list all of those that have j 8 licenses in nuclear medicine.

9 We're also able to engender labels and we get-a 10 lot of requests from companies, etcetera, under FOI for a 11 database in the form of labels so they can do special 12 mailings and all.

/~N l k_ 13 The information that's on those 44 forms simply 14 comes in off of a four-page application form, and certain j 15 pieces of information are entered directly into the PC 16 computers as they come in. The forms are then filed. We i 17 very rarely have to go back and look at the forms unless 18 there's some error in the database file.

19 We are working -- this would be amenable to using 20 a scanner to scan the information directly in, but that's 21 not very easy to do when people do handwriting.

22 I won't bore you with the four pages of the form.

23 Then that --

in the RT licensing area, this is just actually 24 two bills to show you. One of them is sufficient.

25 The same process here. They're all assigned a

I l

l 1

! O) l .,

v 224 1 specific RT license number, and only licensed radiological 2 technologists may operate within the state. We have thrown 3 the onus on all of the facilities to our registration 4 program by serving them notice with their x-ray bills two 5 years in a row that you cannot hire an unlicensed 6 radiological technologist.  !

l 7 And the same business here, these technologists 8 have to have a certificate and have to post it conspicuously 9 so that the patients can see that they are. So this is 10 actually -- their part of this is actually about -- the 11 interesting thing is this billing fee is $25 a year.

12 Well, what we have done is sort of compensate for

(.__) 13 what Joe was talking about, rather than have them all come 14 in at one time, we have the bills expire on the last day of 15 the birth month of the applicant. So we spread them out 16 over 12 months. Statistically, they should be one-twelfth 17 every month, how it comes out.

18 And, of course, with the database, that's all you 19 have to do, is go in and write a simple query. Everyone 20 whose birth month is in March, give me bills just for the 21 month of March. Also, we've got the program so that it not 22 only then gives you the March bills, but it also gives you 23 March certificates when they are paid.

24 It also gives you a set of mailing labels for just

(~) 25 those who are being billed in March. So you don't have to

'%-)

() then do anymore handwriting.

225 1 You just simply match them up 2 and mail them out. The clerical staff does it. I' don't 3 have anyone specifically assigned. After coffee in the 4 morning, they might just all get around and stuff all the 5 envelopes in 15 minutes and get them out of the office so 6 it's the least amount of activity.

7 The only problem is when you first come into the 8 system, depending upon when you come in, the amount of your 9 bill would not be a straight $25 per year. It's $25 for 10 that year and $2 a month for every month into the next year 11 to get you up to your birth month. So anyone could be as 12 low as $27 or as high as $49.

b

\

13 But the program can do that. You don't even have l 14 to sit and calculate that. It does it automatically. So 15 the only thing you have to watch is when the check comes 16 back in, that the amount of the check matches the amount 17 that was due in the program.

18 We don't fiddle around with inaccurate checks. We 19 send them back. We don't just cash everything like Alabama 20 does and run. Our state has more difficultly producing a 21 check to pay back someone for two or four dollars that they 22 overpaid or underpaid. So they'd rather have us send them 23 back and wait to get a new check in.

24 In the followup, once the person has actually paid 25 and the computer enters it as paid, then it's a very simple

("3 i \_)

I

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(-) 226 1 program. If that particular column shows that person has 2 paid the bill for 1991 to 1993, then a certificate is 3 automatically issued and also a set of labels is issued for 4 everyone that you put in that day, and they just -- there's 5 like a two or three day turnaround by the time the bill 6 comes in till they get the certificate back in the mail.

7 Some of them even get to the point where they'd 8 like to come by the office because they know that they can't 9 start to work on Monday in their new job unless they have 10 that certificate to put up on the wall.

11 We have the same, which is you have 30 days in 12 which to pay. On the 45th day, we send the second notice.

(m) 13 That gives another 45 days, and then the third notice, and 14 the third notice has a ten-day requirement on it and a 15 notification that if the check ic not received by close of 16 business within ten days, it's turned over to our legal 17 counsel.

18 We have legal counsel in the department who are 19 officers of the Attorney General's Office who get a big 20 charge out of following through on a dentist who hasn't paid 21 his $15 tube, etcetera, and they will go after it. We have 22 fines of up to $100,000' for noncompliance with any of our 23 regulations, and not paying your bill is noncompliance in 24 our regulations.

25 If you owe 15 bucks, you stop and think twice O( g

('s 227 1 about owing back when you're faced with the possibility of 2 $100,000 fine for it.

3 We have fined -- we usually use the principal that 4 pick one from each category and make an example out of that 5 person, and the word spreads as fast as you can imagine. We 6 had a dentist clear out in the western part of the state who 7 kept on.saying I'm not going to pay this $15 bill. I never 8 used the unit. Then we say, well, get rid of it. No, no, I 9 want to keep it there because it looks nice. Then you pay 10 the $15. You possess the unit, you have to pay the money. j l

11 I'm not going to pay it to these bureaucrats in 12 the eastern part of the state. So finally he went through  !

13 his threo notices, his notice from the General Counsel's i 14 office, and he said absolutely I will not pay the thing 15 because I'm not using it. They said, fine, we'll be out 16 sometime next week to dismantle it for you.

l 17 We just went out and took the plug off, went in 18 the unit and took the plug off and walked away from it. Two 19 weeks later, the check came in the mail and the man has to 20 be reinstated. So he really was using it.

21' The other area was in RT licensing, $25 a year to 22 be a licensed RT. One of these HMCa were making the nurses 23 or the receptionists, whoever, do the RT work on nights and 24 weekends. And we said, well, we don't think that's quite ,

gg 25 the intent of the licensing law. And so they said, well, U

l l

l l 228 1 listen, the physician can take' radiographs. So what we do 2 is they just set everything up'and the physician just runs 3 in and presses the button.

4 We said, no, we did a scope of practice and the 5 technologist does a little bit more than just press the 6 button and the setting up is all part of the function. So 7 they claimed that they had eliminated it. Then, of course, 8 we have the greatest pleasure to anyone that's trying to do 9 fees, the whistleblowers.

10 once you pay your bill, you're going to make sure 11 everyone on the block has paid his or hers. So we get lots 12 of those calls and we entertain them and we're very nice to (O_) 13 whistleblowers all the time and we follow right up.

14 So one of the nurses from one of these HMOs, and 15 there were 25 of them spread out through the eastern part of 16 the state, she kept blowing the whistle and saying, you 17 know, they're still making me set up and I'm a nurse, I was 18 never trained to do this and I don't want to do it. And 19 we're saying, well, you shouldn't be doing it.

20 So finally we fined them $1,000 fine for using a 21 non-licensed radiological technologist and a cease and 22 desist from doing it any further. But then the $1,000

23. didn't seem enough, so we charged them a $1,000 per facility 24 and they had 25 facilities. So that was $25,000 and, 25 believe me, we haven't filed another one since. Once the

. - --- - =. . - = - .-.

229 1 word got.out that you mean business -- and you really owe 2 that to the program people, etcetera, to be able to develop 3 some' type of a system for punishing those few small ones q 4 that aren't paying in.

5 I think that's probably -- I'probably have covered 6 all the points. Any questions?  ;

7 MR. NASH FROM FLORIDA:- I have one question that's 8 kind of off the subject,.but you mentioned whistleblouers.

i 9 If you have -- I thoroughly believe in them. I'd like to i

10 -pay them, if I could.

11 But we had a doctor who another doctor turned him 12 in. So we started investigating and found out he was 13 absolutely right and he said he -- he demanded to know who 14 did it. What do you do in a case like that?

15 MR. HALLISEY FROM MASSACHUSETTS: The 16 whistleblowers in our office are anonymous and we do not 17 have'to -- we can, according to our lawyers, keep that 18 confidential.

19 MR. NASH FROM FLORIDA: You know who it was. He's 20 not anonynous. He gave you his name, address, telephone 21 number and social security number and you know who he is.

22 He is not anonymous.

23 MR. HALLISEY FROM MASSACHUSETTS: We are still 24 able to keep him confidential as long as you don't write it down someplace. Under the Freedom of Information Act, if O 25

t i

l

!(}

I 1 it's in writing or in your files, you have to release it.

230 I 2 -But just don't write that person's name down. Have a good 1

5 3: memory.

l. 4 MR. BAILEYLFROM CALIFORNIA: If you've got a 5 hearing, though, in court, you might have to give it out, j 6 right? If the guy says, hey, I just want_-to be stubborn.

7 MR. HALLISEY FROM MASSACHUSETTS: According to our

} 8 legal counsel, we do not have to release the name of l 9 anonymous whistleblowers.

i-

! 10 MR. PARKER: There are certain things we don't put i 11 in the files, Ed. If somebody. called you up and said so-1 12 and-so is doing something, you took the information, you h

? \_

3

[ / 13 acted on it and then threw it out, there was nothing in the

! 14 files.

l

15 MR. HALLISEY FROM MASSA ',iUSETTS

The other thing l

! I j 16 is to have a short memory, too. a

17 MR. BAILEY FROM CALIFORNIA

Then obviously the 1 18 whistleblower, you have to go in and confirm what the '

l 19 whistleblower has said, independent of what they said.

i

{ 20 MR. HALLISEY FROM MASSACHUSETTS: Yes. And, of l' 21- . course, one of the easiest ways to do that~on the RTs is to I 22 go in and look at some bills or look at a log. book or 23- someplace where they've made some recording of their 1

] 24 information. And they tend to do that because they want to i

! 25 -get credit to get paid at the end of the week.

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) 231

1 MR. BORCHERT FROM NEBRASKA: Borchert, Nebraska.

2 We've got a specific statute in our state that allows us to 3 keep confidential information in terms of like x-ray 4 inspections, radioactive materials inspections. If we do an 5 investigation, that's confidential information in the State 6 of Nebraska. We've got the Freedom of Information law, but 7 we also have the other specific law that says we do not have 8 to release that.

9 According to the challenges on it, that supercedes 10 the Freedom of Information Act. So you can keep it 11 confidential if you've got the right kind of statutes.

12 MR. BLANTON: Dick Blanton, formerly from Arizona.

(O_) 13 We have a law there that specifically authorizes to keep  ;

14 that information confidential, but there was a provision of

=15 the general state records laws that said under certain 16 circumstances, you could enter a finding that it was in the 17 best interest of the state to keep the information 18 confidential.

19 We could enter an argument that if we released the 20 name of a whistleblower, that this would discourage that 21 kind of reporting and it would be disadvantageous to the 22 state and harmful to the citizens in the future. Only a 23 court could overrule that kind of a finding.

24 MR. PARIS FROM OREGON: Ray Paris, Oregon. Bob, gg 25 do you charge for your labels that you send to the nurse?

Gl

\_ 232 1 MR. HALLISEY FROM MASSACHUSETTS: Yes.

2 MR. PARIS FROM OREGON: Any particular amount?

3 MR. HALLISEY FROM MASSACHUSETTS: The labels for 4 the vendors -- I knew you'd ask that.

5 MR. PARIS FROM OREGON: Anybody else, either.

6 MR. HALLISEY FROM MASSACHUSETTS: I think there's 7 seven on a page and it's 50 cents a page. So multiply it up 8 that way.

9 MR. PARIS FROM OREGON: So you basically recover 10 your cost.

11 MR. HALLISEY FROM MASSACHUSETTS: Yes. We do a

'12 little better than cost recovery, but yes. By the way, I

(_) 13 also forgot to mention we have the printout -- the printers 14 attach to any of the PCs. Then we have developed the forms 15 directly on form-feed paper. You can either do them slowly 16 on an FLQA50 or something like that or do them faster on a 17 laserjet printer. But we do sometimes just do the overnight .

18 run and come in and you find it all over the place.

19 MR. GODWIN FROM ALABAMA: Any other questions?

20 MR. HALLISEY FROM MASSACHUSETTS: Think about that 21 birth month thing. It's one way of spreading it out over a 22 period of time. Then it also addresses the issue that Jill 23 had about being able to show in each fiscal year that you 24 put the right amount of money in there. Well, think about V

-) 25 it.

() 233 i 1 You see our fiscal years run from July to June 30.

2 So we're either collecting in the last half of one fiscal j 3 year or the first half of the next. So there's always --

4 and if you do it $25 a year, but on a two-year basis of $50, 5 then everyone pay -- half the people pay their $50 in any l 1

1 6 one year and it balances out to the same.

l 7 MR. GODWIN FROM ALABAMA: Other questions? Jill?

1 8 .MS. LIPOTI FROM NEW JERSEY: I am consistently i 4

9 amazed at how similar New Jersey is to California, as 10 strange as California is.

I 11 MR. BAILEY FROM CALIFORNIA: If it can be 12 complicated, we have raised it.

'O

(_/ 13 MS. LIPOTI FROM NEW JERSEY: And it also bothers 14 me that it is such a complex system to collect the money j 15 from fees and it is such a simple system to raise the money i 16 through taxes and then get it through appropriations, that I 17 wonder just how much we are adding to the cost of doing 18 business in the state.

19 I think that that kind of debate really needs to 20 take place. So what we strive to do is to minimize the 21 administrative burden with collecting fees. However,  ;

22 several program, Radiation Control Program Directors ago, 23 the Program Director did bad things and got audited. There 24 were -- there was a whole state police investigation of f- 25 where the money was going and the administrative analyst  ;

J

i i

l A 234 1 committed suicide during the investigation. It was really 2 quite something.  !

3 So now in New Jersey we are very clean. We simply i 4 do not touch money in the radiation control program. We

, 5 ' don't get any checks. The checks go to the Bureau of

, 6 Revenue. It would make me very nervous if I opened'an i

i 7 envelope and there was a check in there.

8 What we do, though, is we generate the invoices 9 and we use a computer system to do that. The invoices, 10 however, have the remittance go to the Bureau of Revenue. I 11 think that's wise in this case.

12 The audit turned up all kinds of problems and this

\m) 13 gets rid of our problems. For machine sources, x-rays, 14 registrants are divided alphabetically into four groups.

15 We've got 20,000 tubes, 9,000 facilities. We simply can't 16 ' send out that many bills all at once and have the Bureau of 17 Revenue handle them.

18 So we send out invoices the first of July, first 19 of August, first of September and the first of October. Why 20 July? July is the beginning of our fiscal year. We only ,

21 have'a certain amount of treasury anticipated to live on l 22 until those fees come in, so we have to get the fees coming l 23 in right in the beginning of the fiscal year. l 24 After 30 days, we mail a final notice if they 25 haven't responded to the bill. I have copies of the O

l

-l

! )

1 i

235 1 . invoices that we generate. On the bottom of the invoice is 2 a scan'line and we really haven't had trouble with the scan 3 lines _not being consistent. Those scan lines work well for 4 u s '.

5' So that the information when a check is' received 6 by the Bureau of Revenue, the scan.line is read, we know 7 that that bill has been paid. The computer is updated daily 8 with the checks'that are received. The computer system, 9 same mainframe system is used for the Bureau of Revenue as 10- for our_ registration.

11 So we can access that data by the next morning and 12- .know that they've paid their bill.

13 MS. SHORT FROM TENNESSEE: What do you do in the i

14 case of the facilities that don't return your invoice, 15 though? How does Bureau of Revenue know how to credit it?

16 MS. LIPOTI FROM NEW JERSEY: They return the

'17 invoices. I don't -- I can't explain it, but they do that.  !

18 Everybody does that. But the Bureau of Revenue would have a 19 screen, of course, if they could access -- if they got a 20 check for a specific facility, they could do it.  !

21 MS. SHORT FROM TENNESSEE: Yes. But we get checks '

'22 in for other names. Like, Dr. John Doe, DDS, is registered, 1

23 but a check comes in under Smile center and it's signed by 24 his wife who has a different last name and no invoice.

25 MS. LIPOTI FROM NEW JERSEY: They return the 1

i 236 1 invoice. It says that you must return this invoice and the 2 letter is fairly strongly worded and we do get the invoice 3 back.

4 MR. BAILEY.FROM CALIFORNIA: I enjoy that you can 5 get the data the next morning. Back when we had the 54,000 6 unopened envelopes,.this was when they had put on extra help 7 and we only opened and processed checks with temporary l 8 hourly help in California. That machine enters-it on a disk 9 and that disk had to be physically walked over to the 10 computer system. There was no way to interface and they had 11 to run it --

it was months before we got'that. They would l

12 often lost that disk on the way walking over there. l 13 MS. LIPOTI: Well, we're on-line with the same 14 computer system. And that's good, but it's a mainframe and 15 it's done by contract. The mainframe is a UNISYS computer.

16 What we're trying to do is to bring the computer-system 17 inhouse. So during this year, we're working to get our own 18 WANG system that we own to be able to do all of the billing 19 and to also work with our regular database, to schedule 20 inspections, as you do in Massachusetts.

21 It really makes sense to have everything on the 22 same database. Our collection system for those who don't 23 pay is named Bertha Tillman. Bertha is tough. I wish that 24 I could share Bertha with all of you, but she's ours and 25 she's great.

N/

= -- .. . - - - _..- -. _ . _ .- -.

237

! 1 She calls and she's very polite on the phone and l

l 2 she doesn't threaten anyone, but she's firm. We have a 3 99.99 percent collection rate through Bertha, including the 1

4 dentists. Bertha. You need a Bertha.

5 Our radiologic technology licenses are renewed 6 biannually, and that is a problem because we have to defer 7 50 percent of the revenue. Sometimes those deferments don't 8 exactly make it back into the right accounts. We would like 9 to change to the birth month and we have -- but since it was 10 legislatively mandated to do it biannually, we can't do that l

11 without going back to the legislature.

12 There is a bill before the legislature now to

' O)

(_) 13 change that billing cycle. It's really tacked onto a I

14 mammography bill. So I think it will probably go through. '

15 The only.other thing that I can do is pass around 16 the types of licenses that we issue. They are similar to 17 the others that you have. When the license is printed on a 18 computer, we keep a copy and the original goes to the person l

19 for them to sign and keep in their wallet. I 20 When we do our x-ray inspections or rad materials 21 inspections for nuclear medicine, we check that everyone l

22 handling the materials or using the x-ray machine has the 23 license and we verify quite a few of our licensees that way.

24 MR. GODWIN FROM ALABAMA: Questions?

25 MR. NASH FROM FLORIDA: You say anyone handling s

i

i i /^

238 1 i%)%

l 1 material is also licensed.

2 MS. LIPOTI FROM NEW JERSEY: Those that are --

! 3 like nuclear medicine that would be handling NORM and NARM 4 materials.

5 MR. NASH FROM FLORIDA: What I would call an 6 authorized user that has the training to handle radioactive 7 materials.

8 MS. LIPOTI FROM NEW JERSEY: No. We don't 9 register authorized users, just nuclear medicine techs and 10 rad techs. So it's those that are in the hospital or 11 doctors office environment.

12 MR. THOMPSON FROM ARKANSAS: Jerry Thompson from

(~%

\m,) 13 Arkansas. We use a mainframe -- our agency has a mainframe 14 computer that has all of our registrants and licensees in a 15 customer file. Until a couple of years ago, the Division of 16 Radiation Control did all of the billing, invoice processing 17 and accounting and all that fun stuff.

18 It came to the attention of some of the accounting 19 people in the Health Department, as well c3 some auditors 20 that things weren't -- though there were no problems, things 21 could -- it could get to be such a burden, and it was a 22 burden, that things may not be handled properly.

23 At that time, it fell upon the Bureau of I 24 Environmental Health, which is what the Division of fw 25 Radiation Control is under, and we have since established a

I l

(/

239 j l

1 billing office, as well as a receipt office.

2 The way this works is once a year, in November, we 3 bill everybody. We will registrants, as well as our 4 licenses. The only thing that we as a division have to do l l

5 is we have to go in and purge our system and maybe delete 6 anybody that's been terminated, just go through and make 7 sure that everything is up to date.

8 At that point, the billing is sent out from the 9 billing section. She does all of the billing. We use 10 special mail-outs which they print the address on the 11 outside of the -- kind of like these three-fold deals where 12 you pull out the bill. That's what we use for the bill.

k_) 13 At that point, once they start paying the l 14 receipts, the receipts come directly back to the receipts 15 office. There the cash is handled. We never see the cash I 16 during the annual fee part.

17 Now, it comes across every once in a while that we 18 have to answer questions for them, but we don't just handle I

19 the cash. They send the receipts back to the individual.

20 Within 45 days, the billing person has the capability of 21 going in and seeing who has not paid. She, in turn, 22 invoices them again and we go through that cycle three or 23 four times before it comes to our attention, and then that's 24 when we start handling the letters as far as you haven't 1 1

25 paid your materials license or you haven't paid your x-ray

(^}

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E I

4

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(ll a

m 240 1 registration license, you need to do so within so many days.

2 The only time we see any cash is when we have a 3 new registrant or a new licensee. That is because they're 4 not in the system and we have to enter them physically 4

5 ourselves at the Division of Radiation Control into the 6 system prior to being able to handle -- prior to the receipt 4

7 office being able to handle their check.

8 The only real problem we have with this system is i

9 we have hospitals in which they pay nuclear medicine -- for 10 the nuclear medicine license and their x-ray -- the amounts

11 are the same. They get confused as to what they've paid and 12 what they haven't paid, and that's the only real problem we

(~T <

l () 13 have with this. l

. l 14 MR. GODWIN FROM ALABAMA: Questions?

15 MS. LIPOTI FROM NEW JERSEY: I have a comment.

16 One of the things that we're working towards is to integrate i

17 our bills with all the other bills in the departments. For 18 instance, we can't very well do it with the rad techs 19 because we're probably the only bill that they get.

20 But for hospitals, the medical waste fees are paid 21 to our department. For rad materials, it can be an i l

22 industry, and so they have lots of permits with our 23 department. The idea would be to send one bill once a year j 24 that would have this much is for this particular license, 25 this much is for that permit and so forth.

e i

, .i k_ y) 241 1 Does anybody else have to integrate their own 2 bills with the rest of their departments' bills? It's going 3 to be a massive undertaking in order to assign numbers and 4 cross all of these databases, but I think it will make sense

< 5 in the end.

6 MS. SHORT FROM TENNESSEE: If Tennessee goes to j i

7 this thing of centralized billing for our department, this  ;

8 is what they would like to go to. We really don't want to 9 see it. I guess we're sort of isolated and we like it that I 10 way. We just really are afraid for our dollars getting 11 mixed up with somebody else's dollars and for the accounting 12 to be kept straight and for us to get everything that's 13 coming to us safely. We're just really afraid of that.

14 It, I guess, remains to be seen whether this will 15 happen. If we do go to centralized billing, it will 16 probably be within the next year.

17 MR. GODWIN FROM ALABAMA: Any further questions?

18 MR. BAILEY FROM CALIFORNIA: Yes. Bailey from 19 California. In trying to collect some of our hard bills, 20 the Attorney General's Office has suggested that one of the 21 things we're not presently getting is tax ID number. In 22 California at least, we could offset any income tax refunds 23 to anybody if we showed them owing a bill.

24 I think you mentioned keeping people straight.

25 That's the only way to do it is through the tax ID number or  !

l i

i i

l l

l 242 l l

1 social secur..ty number if it's an' individual. l 1

2 We see it as a good way to help on our 3 . collections. I don't think california would ever get it 4 together'enough to go to centralized billing. There's no 5 way'they could do that.

)

l 6 MR. GODWIN FROM ALABAMA: Other questions? j 7 [No response.] j

.8 MR. GODWIN FROM ALABAMA: Ed, you mentioned that 9 the tax ID number -- many of the people we bill come back 10 later and want our tax ID number, by the way. Just a little 11 quirk of the whole system.

12 If nobody has any other questions, I have a couple 13 I'd like to ask. Of the ones here who charge fees for 14 materials, how many charge general license fees?

15 [Show of hands.]

16 MR. FRAZEE FROM WASHINGTON: That's a general 17 license as in gauge as opposed to --

18 MR. GODWIN FROM ALABAMA: Yes. Just in general, 4

19 how many of you charge for each individual device?

i 20 MR. NASH FROM FLORIDA: You're talking about a 21 general license.

22 MR. GODWIN FROM ALABAMA: A general license.

23 MR. NASH FROM FLORIDA: We charge by device.

24 MR. BAILEY FROM CALIFORNIA: We are getting our 25 regs together to charge and we're going to charge by device.

1 ls

(_ 243 1 MR. GODWIN FROM ALABAMA: All right. Reciprocity 2 fees, how many here of the agreement programs charge

.! 3 reciprocity fees for materials? l 4 [Show of hands.]  ;

5 MR. FRAZEE FROM WASHINGTON: How many charge 100 6 percent?

I I 7 [Show of hands.] l 4

8 MR. FRAZEE FROM WASHINGTON: Same as your in-state j

. 9 licensees.

j 10 MR. NASH FROM FLORIDA: What period do they 4

11 charge? Some of them charge six months, some of them a 4

12 year.

13 MR. GODWIN FROM ALABAMA: Does anyone use other 14 than six months? Of the group that just held up their 15 hands, how many of you use something other than six months 16 for reciprocity?

17 [Show of hands.]

18 MR. GODWIN FROM ALABAMA: You all use one year?

19 MR. FRAZEE FROM WASHINGTON: Well, how do you 20 define that? It depends on how you define it.

21 MR. GODWIN FROM ALABAMA: 180 days a year.

22 MR. FRAZEE: Right. 180 days in one year.

23 MR. GODWIN FROM ALABAMA: Who uses something other 24 than 100 -- of the group that just held up their hands on r~ 25 the fees, the 12, how many of you use something other than G'

1

() 1 244 4

the 180 days in' a ' calendar year?

2 [Show of' hands.]

3 MR. GODWIN FROM ALABAMA: In a year, excuse me. J 4 'MR. NASH FROM. FLORIDA: The time they apply; not_

5 calendar. year. l

-6 MR. FRAZEE FROM WASHINGTON: Not_a calendar year.

'7 MR. GODWIN FROM ALABAMA: Use other than 180. l 8 MR. BORCHERT FROM NEBRASKA: . They pay: the 9 reciprocity fee and'that's valid'for a year. J l

10 MR. FRAZEE: Aubrey, how was that defined? The 11 four people who said they didn't do it the normal way, 180 12 days in a calendar year, that's reciprocity. 180 days in a .!

13 calendar year is the way --

14 MR. GODWIN FROM ALABAMA: In most states, it's 15 defired as 180 days within either 12 months or a calendar 16 year. Some states define it differently. But in any 12-17 month period or 180 days in a calendar year.

18 If you use something other than that, that's what 19 I wanted to know.

20 MR. FRAZEE: What is that other?

21 MR. GODWIN FROM ALABAMA: Some have unlimited 22 reciprocity. Louisiana does or used to.

23 MR. BOHLINGER FROM LOUISIANA: One year from date 24' of receipt.

25 MR. FRAZEE FROM WASHINGTON: One year from date of O

l 3

(_) 245 1 receipt of the fee.

2 MS. SHORT FROM TENNESSEE: We would require to 3 make it a state license after the 180 days, but the fees 4 that they pay would transfer then to be their license 5 application fee and their maintenance fee so that they would l 6 not pay an additional fee within that 12 months. ]

l 7 MR. BAILEY FROM CALIFORNIA: Even if they don't 8 have a-permanent location in the ct ate..

9 MS. SHORT FROM TENNESSEE: Yes. You come in --  ;

10 one day, you pay -- if it's the $4,000 fee, you pay $4,000 11 or you could do the whole year for that.

12 MR. GODWIN FROM ALABAMA: I'm somewhat curious 13 about that. Since we -- the way our law works out, we could  !

14 not charge the reciprocity fee. We cut the reciprocity down 15 to 30 days and make them, within 30 days, pay a full license i

16 fee and get a license. So it's just ways to really get to  ;

i 17 the same point.

18 NRC was charging, but we couldn't charge that 19 particular fee the way that our law read.

20 .Yes, Ed?

21 MR. BAILEY FROM CALIFORNIA: Bailey from 22 California. What if you have a company that sends in four 23 crews that are working four different places? Do they count 24 as one?

25 MR. GODWIN FROM ALABAMA: In Alabama it would

(~N t 4 246

\m/

1 count as one because we've got one license to possess 2 wherever and they can have as many crews under it as they 3 want, if that was the way the original state wrote it.

4 MR. BAILEY FROM CALIFORNIA: Can I bring up an 5 interesting thing on reciprocity you may want to delve into?

6 We found out last week that NRC did an inspection under 7 reciprocity at a military base only to find out that it was 8 in California's jurisdiction.

9 We've got to go back to NRC and see if they're 10 going to refund the reciprocity fee and every time they go 11 on to a military base, that they're now going to require  !

1 12 reciprocity. This is the new thing. We were unaware of it l

/

(-)' 13 and you all might be unaware of it, too.

14 MR. GODWIN FROM ALABAMA: We found out on our 15 military bases where we had jurisdiction and where we 16 didn't.

17 MR. FUENTE: Fuente from Mississippi. It is my 18 understanding that NRC is pursuing this jurisdiction bit 19 about Federal-State jurisdiction on some of these 20 facilities.

21 MR. MILLER: This is Vandy Miller. You're hitting 22 on a very sensitive subject right now with NRC, because, let 23 me tell you, it's been our office that's tried to determine 24 whether there is exclusive jurisdiction or not, and that's

(- 25 not an easy task. I'll just tell you.

( )}

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() 247

, 1 Now, you can have a building, have one room that's  !

2 only the exclusive jurisdiction out of that whole base if, 3 say, you had an Air Force base. So you have to go through a 4 lot of hoops to determine that.

5 What we're trying to do right now from a very 6 practical standpoint is to say that it is the state's 7 responsibility unless there is an enforcement that has to 8 take place. Then we will go through all of those hoops and 9 determine whether it's exclusive jurisdiction or not.

10 Follow that? But that's not the rule, but that's 11 the path we're trying to go.

12 MR. GODWIN FROM ALABAMA: What happens if you

/~

, k,T) 13 already determined it? Can we just tell you what the 14 determinations were in the past and work from that basis?

15 I've got maps, or at least I had maps of all the 16 jurisdictions.

17 MR. MILLER: We thought we had that, too, Aubrey.

18 It is complicated. It's an FTE driver, too. It takes a lot 19 of time to arrive at that. And you may not want -- like I 20 said, if there's no enforcement action, if the reciprocity 21 licensee doesn't screw up, then the state should get the --

22 they should have filed the form with the state rather than 23 with the NRC.

24 If you're in an agreement state, a licensee in an 25 agreement state, you go to another agreement state, but you

7 248 1 go to a Federal installation. That reciprocity form should

'2 be filed with that agreement state and not with the NRC.

3 MR. BAILEY FROM CALIFORNIA: Well, we're going to 4 make a lot of money, then, because what happens is 5- California licensees file to go on Federal facilities and 6 pay the fee.

7 MR. GODWIN FROM ALABAMA: You wouldn't get it 8 then.

9 MR. BAILEY FROM CALIFORNIA: Right, I know. But 10 right now what we have going on is after the inspection, we 11 have to do the enforcement or whatever. It's real -- we 12 need one of these meetings to talk about jurisdiction.

13 MR. MILLER: That is not an issue we can 14 straighten out here at this meeting.

15 MR. BAILEY FROM CALIFORNIA: Right.

16 MR. MILLER: But it is one that the NRC is very 17 conscious of and is working on. ,

i 18 MR. FUENTE FROM MISSISSIPPI: It is an issue i

19 because it does deal with fees. Fuente from Mississippi. I 20 Just recently Mississippi, at a NASA test site in north 21 Mississippi, a --

I guess it would be a subcontractor, 22 industrial licensee. We assessed him a fee. NRC came back 23 out of the region and assessed him a fee. He was opposed at 24 paying two fees, so he wanted to know who had the jurisdiction.

O 25

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l 1

i

l. 249 1 MR. GODWIN FROM ALABAMA: Exactly.

2 MR. MILLER: Before NRC started charging fees for 3 reciprocity, there was nobody -- nobody ever challenged 4 that. - But now that that big fee is up there, these f 5 licensees are really going to challenge NRC every time as to

] 6 their authority to charge that fee, reciprocity or not, and 7 in most cases they probably will not have that authority.

8 MR. GODWIN FROM ALABAMA: One more question. Of i

i 9 the programs who actually receive money, how many of you 10 have your staff bonded in one form or another about 11 receiving the money? I'm one of them.

! 12 [Show of hands.]

{ 13 MR. NASH FROM FLORIDA: We have then

14- fingerprinted, but not bonded.

i

]

15 MR. GODWIN FROM ALABAMA: Are you serious?

i 16 MR. NASH FROM FLORIDA: Yes.

} 17 MR. PARKER: I think we've had a very productive 18 day and I think we-owe a little round of applause to Harry 19 and Aubrey.

i 20 [ Applause.]

3 21 MR. PARKER: We have finished questions one i

22 through four. We will start on question five tomorrow, 23 about develop standard fees, or, as I mentioned in my j 24 opening remarks, whether there should be a minimum fee, and i 25 then everyone can feed off of that.

lN .

l 4

\_)) 5*

l 1 We'd like to start at 8:00. I.think I spoke to 2 Mary and Mary said that she will'be able to take care of 3 that, that she will have somebody here at 8:00.

4 We will go through with a short break around 5 10:00. So hopefully we'll wind up approximately sometime 12 6 to 1:00. So those people who have early flights will be 7 able to make.them. So we'll see you all tomorrow at 8:00, 8 Thank you very much for a very productive session.

9 [Whereupon, at 5:00 p.m., the meeting was 10 recessed, to reconvene the following day, April 29, 1992, at 11 8:00 a.m.]

12 13 14 15 16 17 18 1 19 20 21 22 23 24

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

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\g REPORTER'S CERTIFICATE This.is to certify that the attached proceedings ,

before the United States Nuclear Regulatory l Commission

in the matter of

NAME OF PROCEEDING: Funding Radiation Control Program @!

with Emphasis on Fee Schedules 1 Effective Strategies for 1990's j DOCKET NUMBER: l PLACE OF PROCEEDING: Bethesda, Maryland were held as herein appears, and that this is the original transcript thereof for the file of the i United States Nuclear Regulatory Commission taken {

by me and thereafter reduced to typewriting by me 2

or under the direction of the court reporting

company, and that the transcript is a true and l pe"S q j accurate record of the foregoing proceedings.

u) ~

\

l

dfficial Reporter Ann Riley & Associates, Ltd.

l d I

, i l

l l

/

V REPORTER'S CERTIFICATE This is to certify that the attached proceedings before the United States Nuclear Regulatory Commission in the matter-of:.

NAME OF PROCEEDING: Funding Radiation Control Programs with Emphasis on Fee Schedules

)

Effective Strategies for 1990's DOCKET NUMBER:

PLACE OF PROCEEDING: Bethesda, Maryland were held as herein appears, and that this is the original transcript thereof for the file of the United States Nuclear Regulatory Commission taken by me and thereafter reduced to typewriting by me  !

or under the direction of the court reporting l company, and that the transcript is a true and 0 accurate record of the foregoing proceedings.

'? % 0 2 official Reporter Ann Riley & Associates, Ltd.

I i

V

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