ML20136A766
| ML20136A766 | |
| Person / Time | |
|---|---|
| Issue date: | 06/28/1996 |
| From: | Shirley Ann Jackson, The Chairman NRC COMMISSION (OCM) |
| To: | Hoyle J NRC OFFICE OF THE SECRETARY (SECY) |
| Shared Package | |
| ML20136A735 | List: |
| References | |
| FOIA-96-336, FOIA-96-A-14 SECY-96-124-C, NUDOCS 9703100043 | |
| Download: ML20136A766 (1) | |
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UNITED S TATES
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NUCLEAR REGULATOR COMMISSION i
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June 28, 1996 l
l OFFICE OF THE CHAIRMAN MEMORANDUM TO:
John C. Hoyle, Secretary f
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Q Shirley Ann Jackson FROM:
SECY-96-124 - FINANCIAL ASSURANCE FOR GENERAL
SUBJECT:
ATOMICS FACILITIES I do not object to the staff's consideration of the exercise of type of circumstances described enforcement discretion under the in SECY-96-124.
This decision.does not represent any view on the desirability of, or direction to the staff to enter into, any settlement agreement regarding Sequoyah Fuels facility in Gore, Oklahoma.
In addition, this decision does not involve any including any existing prejudgment of any matters in litigation,concerning the aforementioned or proposed settlement agreement facility.
cc:
Commissioner Rogers Commissioner Dieus EDO OGC i
l 9703100043 970228 pi PDR FotA CURRAN 96-A-14 PDR i
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UNITED STAILS
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WASHINGTON. D.C. 20555-001)1 3k :
'I July 1,1996 CHAIRMAN MEMORANDUM TO:
James M. Taylor Executive Director for Operations FROM:
SUBJECT:
FINANCIAL ASSURANCE FOR FACILITIES As a result of the changing economic climate facing many licensees, it may be appropriate for the staff to take a broader look at its approach to financial assurance.
The staff should examine:
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The methods for establishing financial assurance by holders of Part 50 and 70 licenses, particularly the use of a parent company guarantee and the advisability of the prohibition in 10 C.F.R. SS 50.75(e)(2) and 7C 25(f)(2) on the use of a parent company guarantee in combination with i
otner financial methods to satisfy NRC financial assurance requirements:
2.
The scope and frequency of the NRC's review of the cost estimates for decommissioning that are required by 10 C.F.R. SS 50.75(d) and 70.25(e) and the staff's ability to identify hhother a licensee fails to satisfy i
l these requirements during any given period: and 3.
The advisability of (a) establishing criteria which would trigger a i
reevaluation of the basis upon which financial assurance has been established when changed circumstances could arise which would affect the ability cf a licensee to meet financial assurance requirements: and (b) potential mechanisms for applying and monitoring the criteria.
cc: Commissioner Rogers issioner Dicus 7
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I IIACKGROUND INFO ON FIN ANCIAL ASSURANCE (SECY 96-124)
Parent Company certification is not cumulative and assets are not " set aside.'
'e NRC review is a snap shot in time based on financial statements submitted (usually within 90 days after the end of the physical year per Part 30. Appendix A).
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Per Part 30, Appendix A, a parent company must pass the tests in either II.A.1 or I
ll. A.2:
A.l(i) The parent must pass two of the following three tests:
(examples here are based on the 1995 financial statement and the previous l
gnillion estimate for decommissioning that assumed a nilhon) decommissioning tax credit; the corrected estimate is Total Liabilities / Net Worth less than 2.0 a
i Net income plus depreciation, depletion, and amortization to l
total liabilities greater than 0.]
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Current Assets / Current Liabilities greater than 1.5 f
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j A. l(ii) Net working capital and tangible net worth each at least six times the current decomissioning cost estimates $ million for TRIGA reactors only).
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A.l(iii) Tangible net worth of i
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,I Licensees are to notify the NRC within 90 days of any matter coming to an auditor's attention which leads the auditor to conclude that the parent company cannot meet the financial test in Part 30, Appendix A.II. A.
Total GA share for decommissioning San Diego facility are estimated ath
($or reactors + gfor balance (2 hot cells,4 test labs, fuel fabricanon facility waste, etc.))
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GA is currently decommissioning its hot cell facility witF ontribution by DOE.
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i TRIGA reactor license expire in two and four years.
GA (and the staff) believe that DOE will pay balance of decommissioning cost for San Diego, approximately million.
GA will provide $million parent company guarantee and place million annually l
in a sinking fund (with a portion frozen so it will accrue to fier two years -
-- to coincide with the 2-year expiration date of one license -- and million in four years -- the latest reactor license expiration date). Cash on hand w cover the cost of reactor decommissioning upon expiration of each license.
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