ML23163A150
| ML23163A150 | |
| Person / Time | |
|---|---|
| Issue date: | 06/06/2023 |
| From: | Virkar H NRC/OIG/AIGA |
| To: | Dan Dorman, Scott(Ois) Morris NRC/EDO, NRC/EDO/DEDR |
| References | |
| OIG-21-A-14 | |
| Download: ML23163A150 (1) | |
Text
MEMORANDUM DATE: June 6, 2023 TO: Daniel H. Dorman Executive Director for Operations Scott A. Morris Deputy Executive Director for Reactor and Preparedness Programs Office of the Executive Director for Operations FROM: Hruta Virkar, CPA /RA/
Assistant Inspector General for Audits
SUBJECT:
STATUS OF RECOMMENDATIONS: AUDIT OF THE U.S.
NUCLEAR REGULATORY COMMISSIONS OVERSIGHT OF THE ADEQUACY OF DECOMMISSIONING TRUST FUNDS (OIG-21-A-14)
REFERENCE:
DIRECTOR, OFFICE OF NUCLEAR REACTOR REGULATION, MEMORANDUM DATED MARCH 20, 2023 Attached is the Office of the Inspector Generals (OIG) analysis and status of recommendations as discussed in the agencys response dated March 20, 2023. Based on this response, recommendations one and two are closed. Recommendation three was previously closed. Recommendation four remain open and resolved. Please provide an updated status of the open, resolved recommendation by September 30, 2023.
If you have any questions or concerns, please call me at 301.415.1982 or Avinash Jaigobind, Team Leader, at 301.415.5402.
Attachment:
As stated cc: M. Bailey, OEDO J. Jolicoeur, OEDO RidsEdoMailCenter Resource OIG Liaison Resource EDO_ACS Distribution NRC Headquarters l 11555 Rockville Pike l Rockville, Maryland 20852 l 301.415.5930 www.nrcoig.oversight.gov
Audit Report RESULTS OF THE AUDIT OF THE NRCS OVERSIGHT OF THE ADEQUACY OF DECOMMISSIONING TRUST FUNDS Status of Recommendations (OIG-21-A-14)
Recommendation 1: Improve process controls to ensure all annual reviews of decommissioning status reports are complete and have undergone the review process.
Agency Response Dated March 20, 2023: To improve process controls and further enhance the quality and consistency of status report review, the staff revised its training program for Financial Assurance Branch (FAB) analysts, detailed in NRR Office Instruction, LIC-205, Revision 6, Procedures for NRCs Independent Analysis of Decommissioning Funding Assurance for Operating Nuclear Power Reactors and Power Reactors in Decommissioning, (LIC-205). The revised training program emphasizes the roles, responsibilities, and review processes related to the Decommissioning Funding Status (DFS) review program for both operating reactors and reactors in decommissioning.
Furthermore, in accordance with LIC-205, a qualified lead analyst will provide training annually to all analysts involved with the DFS report review. The next revised training sessions, using the updated LIC-205, are planned for March (operating reactors) and early April 2023 (decommissioning reactors). The training will take place prior to the commencement of 2023 review cycle for operating reactors and reactors in decommissioning.
Target Date for Completion: April 30, 2023 Point of
Contact:
Shawn Harwell OIG Analysis: On June 5, 2023, the OIG verified the revision of LIC-205, which includes training to improve process controls for the annual review of decommissioning status reports. This recommendation is now closed.
Status: Closed.
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Audit Report RESULTS OF THE AUDIT OF THE NRCS OVERSIGHT OF THE ADEQUACY OF DECOMMISSIONING TRUST FUNDS Status of Recommendations (OIG-21-A-14)
Recommendation 2: Update LIC-205 to clarify DFS report reviewer roles and responsibilities, procedures for closeout letters, and procedures for tracking DFS report analyses.
Agency Response Dated March 20, 2023: The staff revised LIC-205, providing more detail on the roles and responsibilities of each position involved with the DFS review process and enhancing the annual training program for FAB analysts involved with the review. Additionally, the staff incorporated detailed procedures for drafting and issuing closeout letters to licensees at the conclusion of the review cycle. Finally, the staff revised procedures for cataloging and tracking documentation related to individual licensee DFS report submittals and reviews for each DFS report review cycle in the FAB SharePoint site to ensure that information is up to date, as discussed in Recommendation
- 3. The revised LIC-205 guidance is currently in the concurrence process and is expected to be issued in April 2023.
Target Date for Completion: April 30, 2023 Point of
Contact:
Shawn Harwell OIG Analysis: On June 5, 2023, the OIG verified that the DFS report reviewer roles and responsibilities were clarified in the revision of LIC-205. This recommendation is now closed.
Status: Closed.
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Audit Report RESULTS OF THE AUDIT OF THE NRCS OVERSIGHT OF THE ADEQUACY OF DECOMMISSIONING TRUST FUNDS Status of Recommendations (OIG-21-A-14)
Recommendation 3: Implement a central tracking mechanism to track the status of the annual DFS report analyses.
Agency Response Dated March 20, 2023: To address Recommendation 3, the staff enhanced its current DFS report review tracking capability on the FAB SharePoint site. Specifically, the staff developed a SharePoint page addressing the annual DFS review for reactors in decommissioning that includes fields, with Agencywide Documents Access and Management System links as applicable, to track licensee initial and supporting documents, staff generated documents, and review status for individual licensees for each DFS review cycle. As discussed in Recommendation 2, the staff revised LIC-205 to make certain that the assigned staff analysts update SharePoint, as necessary, to ensure that the information maintained up to date.
SharePoint Development: Completed.
Point of
Contact:
Shawn Harwell OIG Analysis: This recommendation was previously closed.
Status: Closed.
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Audit Report RESULTS OF THE AUDIT OF THE NRCS OVERSIGHT OF THE ADEQUACY OF DECOMMISSIONING TRUST FUNDS Status of Recommendations (OIG-21-A-14)
Recommendation 4: Periodically assess, through communication with cognizant regulators or by other means, trustee compliance with the master trust fund agreements in accordance with investment restrictions in Title 10 of the Code of Federal Regulations (10 CFR) 50.75.
Agency Response Dated May 20, 2023: The staff held meetings with staff and attorneys of the Federal Energy Regulatory Commission (FERC) and the U.S. Federal Reserve Board (USFRB), to learn about these regulators oversight authority over trusts and investments in decommissioning trust funds (DTFs). FERC attorneys and staff indicated that the agency will be unable to assist in the periodic assessment of trustee compliance with the master trust fund agreements in accordance with NRC investment restrictions, since FERC maintains oversight of utilities and potentially their trust fund investments but does not maintain similar oversight of merchant plants; the regulation at issue indicates licensees that are not electric utilities, i.e., merchant plants. (See 10 CFR 50.75(h)(1)). Accordingly, collaboration with FERC on this effort will not be viable.
USFRB attorneys indicated that they do not perform financial audits or analyses that address the investment restrictions identified in NRC regulations. Furthermore, USFRB attorneys indicated that they were unable to put in place a general Memorandum of Understanding with the agency or other such vehicle committing to help the NRC address this task, nor were they willing to provide correspondence about a particular trustee following oversight reviews or audits performed by the USFRB in the future. Finally, staff is continuing to pursue additional outreach with trustees themselves, to learn what information that they may be able to provide regarding this matter.
While not NRC licensees, the trustees may be able to provide some assurance that NRC investment restrictions in 10 CFR 50.75(h) are adhered to in merchant plant decommissioning 5
Audit Report RESULTS OF THE AUDIT OF THE NRCS OVERSIGHT OF THE ADEQUACY OF DECOMMISSIONING TRUST FUNDS Status of Recommendations (OIG-21-A-14)
Recommendation 4 (continued):
trust fund portfolios. Upon completion of its outreach to trustees, staff will have performed its due diligence in responding and will terminate further assessment activities. Staff will document its research and response to Recommendation 4 by July 31, 2023.
Target Date for Completion: July 31, 2023 Point of
Contact:
Richard Turtil OIG Analysis: The proposed actions meet the intent of this recommendation. Additionally, as proposed in the agencys memorandum, dated September 20, 2022, staff proposed the development of a procedure that will document insights from their research and how to best periodically assess compliance with investments/activities consistent with Title 10 CFR 50.75. The OIG will close this recommendation upon reviewing the procedure to periodically assess trustee compliance with investments/activities consistent with Title 10 CFR 50.75, as well as staffs research. This recommendation remains open and resolved.
Status: Open: Resolved.
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