ML23277A108

Enclosure 3 - Regulatory Analysis of Advance Tribal Notification

ML23277A108
Person / Time
Issue date:	02/15/2024
From:	NRC/NMSS/DREFS/MRPB
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Shared Package
ML23277A104	List: ML23277A106 ML23277A107 ML23277A108
References
NRC-2022-0191, RIN 3150-AK90
Download: ML23277A108 (36)

Text

Regulatory Analysis for the Proposed Rule:

Advance Notification of Category 1 Quantities of Radioactive Material Shipments NRC-2022-0191; RIN 3150-AK90 U.S. Nuclear Regulatory Commission Office of Nuclear Material Safety and Safeguards Division of Rulemaking, Environmental, and Financial Support February 15, 2024

i ABSTRACT The purpose of the proposed rule is to amend regulations in Title 10 of the Code of Federal Regulations (10 CFR) Part 37, Physical Protection of Category 1 and Category 2 Quantities of Radioactive Material. The proposed rule would add requirements for licensees to provide to Tribal officials of participating federally recognized Tribes, or their designees, advance notice of shipments of category 1 quantities of radioactive material under 10 CFR 37.77 before shipments pass within or across the boundary of participating Tribal reservations. The U.S. Nuclear Regulatory Commission is also proposing to make changes to 10 CFR 37.5, Definitions, by adding definitions for Indian Tribe and Tribal official, and to 10 CFR 37.29, Relief from fingerprinting, identification, and criminal history records checks and other elements of background investigations for designated categories of individuals permitted unescorted access to certain radioactive materials, to exempt Tribal officials or the Tribal officials designee from fingerprinting requirements. Minor conforming changes also would be made to 10 CFR 37.21, Personnel access authorization requirements for category 1 or category 2 quantities of radioactive material, and 10 CFR 37.43, General security program requirements.

This regulatory analysis evaluates the costs and benefits of the proposed rule and implementing guidance relative to the baseline case, a no-action alternative.

ii EXECUTIVE

SUMMARY

The U.S. Nuclear Regulatory Commission (NRC) is proposing to amend its regulations in Title 10 of the Code of Federal Regulations (10 CFR) Part 37, Physical Protection of Category 1 and Category 2 Quantities of Radioactive Material, to ensure consistency regarding advance Tribal notification of certain radioactive material shipments with similar NRC regulations for State notification. Currently, 10 CFR part 37 only requires advance notification of certain radioactive material shipments to be sent to States unlike the advance notification provisions of § 71.97 Advance notification of shipment of irradiated reactor fuel and nuclear waste, and § 73.37, Requirements for physical protection of irradiated reactor fuel in transit, those regulations require advance notifications of specified shipments to be sent to States and participating federally recognized Tribes.1 The proposed rule would expand the licensee requirements in 10 CFR Part 37 to also provide advance notice of shipments of category 1 quantities of radioactive materials to Tribal officials, or their designees, under the Tribal Advance Notification program. The proposed rule would also resolve a petition for rulemaking (PRM-37-2).2 This regulatory analysis evaluates the costs and benefits of the proposed rule and implementing guidance relative to the baseline case, the no-action alternative.

The NRC has made the following key findings:

Proposed Rule Analysis. The proposed rule recommended by the staff would result in additional costs as shown in Table ES-1.

Table ES-1 Summary of Costs and Benefits Entity Total (2023 Dollars)

Undiscounted 7% NPV 3% NPV NRC

($253,000)

($229,000)

($242,000)

Industry

($1,522,000)

($984,000)

($1,252,000)

Agreement States

($902,000)

($788,000)

($850,000)

Tribal Governments

($128,000)

($104,000)

($116,000)

Net Benefit (Cost)

($2,805,000)

($2,105,000)

($2,460,000)

Nonquantified Benefits. Based upon the assessment of total costs and benefits, the NRC concludes that the proposed rule, if issued, would provide benefits to regulatory efficiency and effectiveness for both the NRC and industry by enhancing the Advance Tribal Notification program and increasing its scope, and would provide Tribal governments with greater regulatory predictability. The proposed rule would enhance the Tribal Advance Notification program by providing a more transparent view of category 1 quantities of radioactive material shipments. Furthermore, the proposed rule would resolve an inconsistency among the NRCs advance notification regulations in 1

See Advance Notification to Native American Tribes of Transportation of Certain Types of Nuclear Waste rule, Volume 77 of the Federal Register (FR), page 34194 (77 FR 34194; June 11, 2012).

2 PRM-37-2, R. Arnold & R. Johnson on Behalf of the Tribal Radioactive Materials Transportation on Advance Tribal Notification of Certain Radioactive Material Shipments (ML21042B011, December 4, 2020)

iii 10 CFR Part 37 and 10 CFR Parts 71 and 73. The proposed rule is also consistent with Principle 2 of the NRCs Tribal Policy Statement,3 which recognizes the importance of Tribal sovereignty and the right to self-governance. The proposed rule would support both Tribal sovereignty and the right to self-governance by providing additional information to aid Tribal governments with decision-making regarding Tribal territory.

Uncertainty Analysis. The regulatory analysis contains a Monte Carlo simulation analysis that shows that the mean net benefit for this proposed rule is ($2,104,000) with 90 percent confidence that the net benefit is between ($2,832,000) and ($1,580,000) using a 7 percent discount rate. The number of Tribes that enroll in the Tribal Advance Notification program after the proposed rule is active is the factor responsible for the largest variation in costs, followed by the industry labor rate.

Decision Rationale. While the proposed rule is not quantitatively beneficial, it removes an inconsistency in the NRCs notification regulations, enhances the Tribal Advance Notification program, and improves the NRCs relationship with Tribes. Additionally, most of the costs are incremental and associated with procedures that are already in place since licensees currently provide advance notice of shipments of category 1 quantities of radioactive materials to State governments under Part 37, and to State and Tribal governments before irradiated reactor fuel and certain nuclear waste shipments pass within or across the boundary of States or Tribal reservations under Parts 71 and 73.

The costs are mainly dependent on the number of Tribes interested in participating and the actual number of shipments of category 1 quantities of radioactive material.

Implementation. The NRC expects that the final rule would be effective in 2025. Full implementation by Agreement States would be approximately 3 years later. The NRC plans to issue a set of supplemental frequently asked questions with the final rule.

3 Tribal Policy Statement (82 FR 2402; January 9, 2017).

iv CONTENTS ABSTRACT.................................................................................................. i EXECUTIVE

SUMMARY

............................................................................. ii LIST OF FIGURES..................................................................................... vi LIST OF TABLES...................................................................................... vii ABBREVIATIONS AND ACRONYMS...................................................... viii 1 STATEMENT OF PROBLEM AND OBJECTIVE.................................... 1 1.1 Description of the Proposed Action...................................................................... 1 1.2 Need for the Proposed Action............................................................................... 2 1.3 Existing Regulatory Framework............................................................................ 2 2 IDENTIFICATION AND PRELIMINARY ANALYSIS OF ALTERNATIVE APPROACHES.............................................................. 3 2.1 Alternative 1: No-Action Alternative...................................................................... 3 2.2 Alternative 2: Publish Advance Tribal Notifications Rule...................................... 3 2.3 Other Alternatives Considered.............................................................................. 3 3 ESTIMATION AND EVALUATION OF COSTS AND BENEFITS........... 4 3.1 Identification of Affected Attributes....................................................................... 4 3.1.1 Industry Implementation...................................................................................... 4 3.1.2 Industry Operation............................................................................................... 4 3.1.3 NRC Implementation........................................................................................... 4 3.1.4 NRC Operation.................................................................................................... 5 3.1.5 Other Government Entities.................................................................................. 5 3.1.5.1 Agreement States.................................................................................................... 5 3.1.5.2 Tribal Governments................................................................................................. 5 3.1.6 Regulatory Efficiency.......................................................................................... 5 3.1.7 Other Considerations.......................................................................................... 5 3.1.8 Attributes with No Effects.................................................................................... 5 3.2 Analytical Methodology......................................................................................... 6 3.2.1 Regulatory Baseline............................................................................................ 6 3.2.2 Affected Entities.................................................................................................. 6 3.2.3 Base Year........................................................................................................... 8 3.2.4 Discount Rates.................................................................................................... 8 3.2.5 Cost/Benefit Inflators........................................................................................... 9 3.2.6 Labor Rates......................................................................................................... 9 3.2.7 Sign Conventions.............................................................................................. 10 3.2.8 Analysis Horizon............................................................................................... 10 3.3 Industry Implementation..................................................................................... 11 3.4 Industry Operation.............................................................................................. 11 3.5 NRC Implementation.......................................................................................... 12

v 3.6 NRC Operation................................................................................................... 13 3.7 Agreement State Implementation....................................................................... 13 3.8 Tribal Government Implementation.................................................................... 14 3.9 Tribal Government Operation............................................................................. 15 3.10 Regulatory Efficiency...................................................................................... 15 3.11 Other Considerations..................................................................................... 16 3.11.1 Consistency with Tribal Policy Statement......................................................... 16 3.11.2 Regulatory Flexibility Act................................................................................... 16 4

SUMMARY

OF THE RESULTS............................................................. 17 4.1 Summary............................................................................................................ 17 4.1.1 Quantified Net Benefits..................................................................................... 17 4.1.2 Nonquantified Benefits...................................................................................... 17 4.2 Uncertainty Analysis........................................................................................... 18 4.2.1 Uncertainty Analysis Assumptions.................................................................... 18 4.2.2 Uncertainty Analysis Results............................................................................. 19 4.2.3 Summary of Uncertainty Analysis..................................................................... 23 4.3 Disaggregation................................................................................................... 23 5 DECISION RATIONALE AND IMPLEMENTATION.............................. 24 6 REFERENCES....................................................................................... 25 APPENDIX A UNCERTAINTY ANALYSIS VARIABLES........................ A-1

vi LIST OF FIGURES Figure 1 Total industry costs (7 percent NPV)Alternative 2........................................... 19 Figure 2 Total NRC costs (7 percent NPV)Alternative 2................................................ 20 Figure 3 Total Agreement State costs (7 percent NPV)Alternative 2............................. 20 Figure 4 Tribal government costs (7 percent NPV)Alternative 2.................................... 21 Figure 5 Total net benefit (cost) (7 percent NPV)Alternative 2...................................... 21 Figure 6 Top cost drivers for which uncertainty impacts the total net costs (7 percent NPV)Alternative 2........................................................................... 23

vii LIST OF TABLES Table ES-1 Summary of Costs and Benefits............................................................................ ii Table 1 Affected Entities as of 2023................................................................................... 7 Table 2 Category 1 Shipments 2025-2034........................................................................ 7 Table 3 CPI-U Inflator......................................................................................................... 9 Table 4 Industry, Agreement State, and Tribal Government Labor Rates....................... 10 Table 5 Industry Implementation Benefits (Costs)............................................................ 11 Table 6 Industry Operation Benefits (Costs).................................................................... 12 Table 7 NRC Implementation Benefits (Costs)................................................................. 13 Table 8 NRC Operation Benefits (Costs)......................................................................... 13 Table 9 Agreement State Implementation Benefits (Costs)............................................. 14 Table 10 Tribal Government Implementation Benefits (Costs)........................................... 14 Table 11 Tribal Government Operation Benefits (Costs)................................................... 15 Table 12 Summary of Totals.............................................................................................. 17 Table 13 Descriptive Statistics for Uncertainty Results (7 Percent NPV)........................... 22

viii ABBREVIATIONS AND ACRONYMS BLS U.S. Department of Labor, Bureau of Labor Statistics CFR Code of Federal Regulations CPI-U consumer price index for all urban consumers FAQ frequently asked question FR Federal Register NPV net present value NRC U.S. Nuclear Regulatory Commission NUREG NRC technical publication OEWS Occupational Employment and Wage Statistics OMB U.S. Office of Management and Budget PERT program evaluation and review technique PRM petition for rulemaking RAMQC Radioactive Material in Quantities of Concern SOC standard occupational classification SRM staff requirements memorandum WBL Web-Based Licensing

1 1 STATEMENT OF PROBLEM AND OBJECTIVE The U.S. Nuclear Regulatory Commission (NRC) is proposing to amend its regulations in Title 10 of the Code of Federal Regulations (10 CFR) Part 37, Physical Protection of Category 1 and Category 2 Quantities of Radioactive Material. The proposed rule addresses a petition for rulemaking (PRM) dated May 18, 2020 (Agencywide Documents Access and Management System (ADAMS) Accession No. ML21042B011), submitted by the petitioner under 10 CFR 2.802, Petition for rulemakingrequirements for filing. The PRM requests that the NRC amend 10 CFR Part 37 to ensure consistency regarding advance notification to Tribes of certain radioactive material shipments with similar NRC regulations for State notification. The NRC docketed the petition as PRM-37-2. In Staff Requirements Memorandum (SRM)-22-0074, Staff Requirements - SECY-22-0074 - Petition for Rulemaking and Rulemaking Plan on Advance Tribal Notification of Certain Radioactive Material Shipments (ADAMS Accession Package No. ML22290A240), dated October 17, 2022, the Commission directed the staff to engage in rulemaking to require advance Tribal notification of shipments of category 1 quantities of radioactive material.

In 10 CFR Part 71, Packaging and Transportation of Radioactive Material, and 10 CFR Part 73, Physical Protection of Plants and Materials, the NRC requires licensees to provide advance notification to participating federally recognized Tribal governments before irradiated reactor fuel and certain nuclear waste shipments pass within or across the boundary of Tribal reservations. In addition, 10 CFR Part 73 provides relief from fingerprinting requirements for Tribal officials, designees, and law enforcement personnel to access safeguards information. Currently, 10 CFR Part 37 only requires licensees to provide advance notification of the shipment of licensed material in category 1 quantities to States, unlike the advanced notifications in provisions in 71.97, Advance notification of shipment of irradiated reactor fuel and nuclear waste and 73.37, Requirements for physical protection of irradiated reactor fuel in transit, which require advance notification of specified shipments to be sent to States and participating federally recognized Tribes. The petitioner noted the inconsistency between the notification requirements in 10 CFR Part 37 and 10 CFR Part 71 and stated that consistent notification standards must be applied to States and Tribal governments as well as constituencies under their respective jurisdictions.

This regulatory analysis evaluates the NRC proposed rule and one alternative, a no-action alternative, for which the NRC would not conduct rulemaking and would continue to not require advance Tribal notification of shipments of category 1 quantities of radioactive material that pass within or across the boundaries of Tribal reservations. The no-action alternative is the baseline to which the proposed action is compared.

1.1 Description of the Proposed Action The proposed action would require licensees to provide to Tribal officials of participating federally recognized Tribes, or their designees, advance notice of shipments of category 1 quantities of radioactive material, as defined under 10 CFR 37.5, Definitions, before shipments pass within or across the boundary of participating Tribal reservations. This action would only affect commercial shipments made by NRC and Agreement State licensees. The NRC is also proposing to change 10 CFR 37.5 by adding definitions for Indian Tribe and Tribal official, and 10 CFR 37.29, Relief from fingerprinting, identification, and criminal history records checks and other elements of background investigations for designated categories of individuals

2 permitted unescorted access to certain radioactive materials, to exempt Tribal officials or the Tribal officials designee from fingerprinting requirements. Minor conforming changes also would be made to 10 CFR 37.21, Personnel access authorization requirements for category 1 or category 2 quantities of radioactive material, and 10 CFR 37.43, General security program requirements. The NRC would also compose a set of frequently asked questions (FAQs) as interim guidance to address the subject of advance notifications for category 1 quantities of radioactive material, in lieu of updating NUREG-2155, Implementation Guidance for 10 CFR Part 37 Physical Protection of Category 1 and Category 2 Quantities of Radioactive Material, which was last updated in March 2022 (NRC, 2022).

1.2 Need for the Proposed Action The NRCs regulations in 10 CFR Part 37 only require advance notification to State governments for shipments of category 1 quantities of radioactive material but do not require notification to Tribal governments for these same shipments. The provisions in 10 CFR Part 71 and 10 CFR Part 73, however, require advance notification for both State and Tribal governments for shipments of certain types of radioactive material. Therefore, the current requirements in 10 CFR Part 37 are different than those in 10 CFR Part 71 and 10 CFR Part 73 and are not consistent with the underlying intent of NRCs Tribal Policy Statement,4 which recognizes Tribal sovereignty and the Tribal governments right to self-governance. In addition, Principle 2 of the Tribal Policy Statement recognizes Tribal governments as separate from State governments, which are already eligible to receive advance notification regarding category 1 materials. The proposed rule would resolve the inconsistency in the current advance notification requirements and is consistent with the NRCs Tribal Policy Statement by demonstrating the NRCs continued recognition of Tribal sovereignty and Tribal governments interest in being informed of activities occurring on Tribal reservations. The amendment would also further the NRCs Principles of Good Regulation5 of openness and clarity.

1.3 Existing Regulatory Framework The regulations in 10 CFR 37.77, Advance notification of shipment of category 1 quantities of radioactive material, only require licensees to inform a State governor, or the governors designee, of shipments of category 1 quantities of radioactive material. In comparison, similar regulations in 10 CFR 71.97, Advance notification of shipment of irradiated reactor fuel and nuclear waste, and 10 CFR 73.37, Requirements for physical protection of irradiated reactor fuel in transit, require licensees to inform both State and participating federally recognized Tribal governments of shipments of certain radioactive material.

4 Tribal Policy Statement (82 FR 2402; January 9, 2017).

5 NRC Principles of Good Regulation, https://www.nrc.gov/about-nrc/values.html#principles

3 2 IDENTIFICATION AND PRELIMINARY ANALYSIS OF ALTERNATIVE APPROACHES The NRC analyzed one alternative to publication of the proposed rule, as described in this section.

2.1 Alternative 1: No-Action Alternative The no-action alternative is to maintain the status quo and deny the PRM. Under the no-action alternative, the NRC would not pursue a rulemaking. This alternative would result in no new direct costs to the NRC, Agreement States, Tribal governments, or industry and serves as the baseline for this analysis.

This alternative would continue to provide reasonable assurance that public health and safety would be adequately protected because the other requirements of 10 CFR Part 37 provide reasonable assurance of the security of category 1 or category 2 quantities of material by protecting them from theft or diversion. The requirements for access to material, use of material, transfer of material, and transport of material would remain unchanged.

This alternative would not resolve the inconsistency pointed out in the PRM and would not promote the principles of the Tribal Policy Statement. Additionally, this alternative would not provide Tribal governments with access to information about the trends in the frequency of shipments through their reservation boundaries, which may be useful for planning or logistical purposes, and would not recognize Tribal governments interest in being informed of activities that occur within their boundaries.

2.2 Alternative 2: Publish Advance Tribal Notifications Rule Under this alternative, the NRC would issue a proposed rule in the Federal Register (FR) with regulations that would revise 10 CFR Part 37 to include advance notification to participating federally recognized Tribes for shipments of category 1 quantities of radioactive materials. The NRC would also compose and publish a set of FAQs.

The rulemaking would be limited in scope to five sections in 10 CFR Part 37, and the proposed revisions would be minor. Issuing the proposed rule would address the PRM and resolve the inconsistency between 10 CFR Part 37 and 10 CFR Parts 71 and 73. This alternative would enhance the Tribal Advance Notification program and align with Principle 2 of the Tribal Policy Statement by recognizing Tribal sovereignty and Tribal governments interest in being informed of activities occurring on Tribal reservations. The amendment would also further the NRCs Principles of Good Regulation of openness and clarity. Because licensees already provide similar advance notifications to State governments, and because Tribal governments already process advance notifications for other types of shipments, the labor involved should be incremental and marginal.

2.3 Other Alternatives Considered The NRC did not consider any other alternatives because there were no other alternatives that met the objectives of SRM-22-0074.

4 3 ESTIMATION AND EVALUATION OF COSTS AND BENEFITS This section examines the costs and benefits expected to result from the NRCs proposed rule.

All costs and benefits are monetized, when possible. The total costs and benefits are then summed to determine whether the difference between the costs and benefits results in a positive benefit. In some cases, costs and benefits are not monetized because meaningful quantification is not possible.

3.1 Identification of Affected Attributes This section identifies the components of the public and private sectors, commonly referred to as attributes, that are expected to be affected by Alternative 2, the rulemaking alternative, identified in section 2 of this regulatory analysis. Alternative 2 would apply to NRC and Agreement State licensees that currently hold licenses for possession of category 1 material.

The NRC developed an inventory of the impacted attributes using the list in NUREG/BR-0058, draft Revision 5, Regulatory Analysis Guidelines of the U.S. Nuclear Regulatory Commission, issued January 2020 (NRC, 2020).

The proposed rule would affect the attributes described below.

3.1.1 Public Health (Accident)

This attribute measures expected changes in radiation exposures to the public due to changes in accident frequencies or accident consequences associated with the proposed action. Under Alternative 2, there may be a reduction in radiation exposure to the public. Tribal governments that choose to participate in the Tribal Advance Notification program would be more informed about shipments that pass within or across their Tribal reservation boundaries and may be able to respond to any accident involving a category 1 shipment more quickly and more comprehensively, reducing the likelihood of any inadvertent exposure of radiation to the public.

3.1.2 Industry Implementation Under Alternative 2, licensees would incur costs resulting from the new requirements in the proposed rule. Licensees would have to train staff on the new requirements. However, the costs should be marginal as the licensees have existing training in place for notifications of shipments.

Industry would also incur costs to participate in the rulemaking process.

3.1.3 Industry Operation This attribute accounts for the projected net economic effect on all affected licensees caused by routine and recurring activities required by Alternative 2. Under Alternative 2, licensees would incur increased costs resulting from identifying shipment routes and notifying the affected Tribal governments. Licensees would also incur some recordkeeping costs.

3.1.4 NRC Implementation This attribute accounts for the projected net economic effect on the NRC to place the alternative into operation. To implement Alternative 2, the NRC would incur a cost in relation to Alternative 1 (i.e., no-action alternative, current regulatory baseline) to issue a rule. In addition, the NRC would incur costs to compose and finalize FAQs.

5 3.1.5 NRC Operation This attribute accounts for the projected net economic effect on the NRC caused by routine and recurring activities required by Alternative 2. The NRC would incur costs under the proposed rule to update and publicize contact lists containing the participating federally recognized Tribal governments.

3.1.6 Other Government Entities 3.1.6.1 Agreement States Agreement States would incur costs to amend their regulations to maintain compatibility with NRC requirements and would be expected to base changes to their regulations on the NRCs rulemaking.

3.1.6.2 Tribal Governments Tribal governments would incur costs under the proposed rule when determining whether to opt in to the Tribal Advance Notification program. Tribal governments that have opted in would incur operational costs to keep contact information updated and to process any notifications that they receive. They would also incur costs to participate in the rulemaking process.

3.1.7 Regulatory Efficiency This attribute accounts for regulatory and compliance improvements resulting from the implementation of Alternative 2 compared to Alternative 1. Alternative 2 would improve regulatory efficiency by allowing federally recognized Tribes to participate in the advance notification program for category 1 shipments. In addition, exempting Tribal officials or their designees from the fingerprinting requirements of 10 CFR Part 37 would incur a marginal averted cost for the NRC and the Tribes that choose to opt in.

3.1.8 Other Considerations The proposed rule would demonstrate the NRCs continued recognition of Tribal sovereignty and the Tribal governments interest in being informed of activities occurring on Tribal reservations, consistent with the Tribal Policy Statement. The proposed rule would also recognize Tribal governments as independent from State governments, with separate and distinct authorities with inherent sovereign powers over their members and territory, consistent with applicable statutes and authorities. The amendment would also further the NRCs Principles of Good Regulation of openness and clarity.

3.1.9 Attributes with No Effects Attributes that are not expected to contribute to the results under any of the alternatives include the following:

Public Health (Routine)

Occupational Health (Accident)

Occupational Health (Routine)

Offsite Property Onsite Property General Public Safeguards and Security Considerations Environmental Considerations Improvement in Knowledge

6 3.2 Analytical Methodology This section describes the process used to evaluate costs and benefits associated with the proposed alternatives. The benefits include any desirable changes in affected attributes (e.g., monetary savings, improved safety, and improved security). The costs include any undesirable changes in affected attributes (e.g., monetary costs, increased exposures).

Of the eight affected attributes, the analysis quantitatively evaluates five: Industry Implementation, Industry Operation, NRC Implementation, NRC Operation, and Other Government. Quantitative analysis requires a baseline characterization of the affected society, including factors such as the number of affected entities, the nature of the activities currently performed, and the types of systems and procedures that licensees would implement, or would no longer implement, because of the proposed alternatives. Where possible, the NRC calculated costs for these attributes using distributions to quantify the uncertainty in these estimates. The detailed cost tables used in this regulatory analysis are included in the individual sections for each of the provisions. The NRC evaluated the remaining four attributes qualitatively because the benefits relating to regulatory efficiency and the other considerations are not easily quantifiable or because the data necessary to quantify and monetize the impacts on these attributes are not available.

3.2.1 Regulatory Baseline This regulatory analysis provides the incremental impacts of the proposed rule relative to a baseline that reflects anticipated behavior if the NRC does not undertake regulatory or nonregulatory action. The regulatory baseline assumes full compliance with existing NRC requirements, that is, all current advance shipment notification requirements contained in 10 CFR Part 37. This assumption is consistent with NUREG/BR-0058 (NRC, 2020), which states that in evaluating a new requirementthe staff should assume that all existing NRC and Agreement State requirements have been implemented. Sections 3.3-3.10 of this regulatory analysis present the estimated incremental costs and benefits of the alternatives compared to this baseline. This regulatory baseline is the no-action alternative (i.e., Alternative 1).

3.2.2 Affected Entities The proposed rule would affect all Agreement States, including Connecticut and Indiana,6 which would institute compatible changes to their regulations. The NRC expects that the proposed rule would affect all materials licensees authorized to possess category 1 materials. The NRC tracks the total number of materials licensees annually through an information request. This count is delineated between NRC licensees and licensees in the National Materials Program. The 2023 count is contained in STC-23-008, Results of the Annual Count of Active Radioactive Material Licenses in the National Materials Program (STC-23-008), dated February 24, 2023.

The NRC also tracks the number of its materials licensees authorized to possess category 1 materials through its Web-Based Licensing (WBL) system. WBL is a materials licensing system that supports the NRC and Agreement States in managing the licensing information of businesses that use radioactive materials. WBL supports the entry of licensing information and license images and enables the NRC and Agreement States to manage the licensing life cycle from initial application through license issuance, amendment, reporting, and termination.

To estimate the number of Agreement State materials licensees authorized to possess category 1 materials, the staff calculated the percentage of its materials licensees authorized to 6

Connecticut and Indiana have submitted letters of intent to become Agreement States.

7 possess category 1 materials out of its overall materials licensees and applied that weighted percentage to the overall number of Agreement State materials licensees.

Table 1 identifies the estimated number of licensees that would be affected by the proposed regulation as of the base year.

Table 1 Affected Entities as of 2023 Type of Category 1 Licensee Number NRC 87 Agreement States 624 Total 711 The proposed rule would also affect Tribal governments that participate in the Tribal Advance Notification program. Currently, seven Tribes participate. The NRC expects that approximately two Tribes would join per year in the first 5 years after the rule becomes effective.

In order to project the number of category 1 materials shipments that would require advance notification of Tribal governments over the analysis horizon, the NRC used data on Radioactive Material in Quantities of Concern (RAMQC)7 shipments as a proxy, because such shipments would qualify for advance notification under the proposed rule. The NRC overlaid the RAMQC shipment data with maps of the six Tribes8 participating in the Tribal Advance Notification program from the period 2018-2022 to determine a mean number of shipments that would require advance notification under the proposed rule per year per Tribe, using a Poisson distribution.9 The data also included information on the rate of RAMQC shipments that required notification of a change in schedule or cancellation. The NRC applied the mean number of shipments per year proportionally to the expected growth in the number of participating Tribes over the analysis horizon to project shipments that would require advance notification to Tribal governments and used the rate of change in schedule notifications and cancellation notifications to project those notifications, as well. Table 2 shows the results.

Table 2 Category 1 Shipments 2025-2034 Year Advance Notification Participating Tribes Shipments Crossing Advance Notification Tribal Lands Shipments Crossing Two Reservations Total Notifications per Year Change Notifications per Year Cancellation Notifications per Year 2025 9

56 7

70 10 1

7 RAMQC refers specifically to 16 radioactive materials (14 single radionuclides and 2 combinations). These materials are americium-241, americium-241/beryllium, californium-252, curium-244, cobalt-60, cesium-137, gadolinium-153, iridium-192, plutonium-238, plutonium-230/beryllium, promethium-147, radium-226, selenium-75, strontium-90 (yttrium-90), thulium-169, and ytterbium-169. RAMQC does not include spent fuel.

8 The seventh Tribe that currently participates in the Tribal Advance Notification program joined the program after the data set time period, and therefore was not included in the data and analysis.

9 The Poisson distribution is a discrete distribution that returns only nonnegative integer values. It is often used to model the number of events that occur in a given time period where the rate of occurrence is constant. For example, it is often used in insurance modeling and financial markets to model the number of events (e.g., earthquakes, fires, stock market crashes) that might occur in a given period. It can also be applied to processes over other domains, such as spatial.

8 Year Advance Notification Participating Tribes Shipments Crossing Advance Notification Tribal Lands Shipments Crossing Two Reservations Total Notifications per Year Change Notifications per Year Cancellation Notifications per Year 2026 12 70 9

87 12 1

2027 14 84 10 104 15 1

2028 16 98 12 122 17 1

2029 19 112 14 139 19 1

2030 19 112 14 139 19 1

2031 19 112 14 139 19 1

2032 19 112 14 139 19 1

2033 19 112 14 139 19 1

2034 19 112 14 139 19 1

3.2.3 Base Year All monetized costs are expressed in 2023 dollars. The NRC expects to incur its implementation costs to prepare and issue a final rule and guidance in 2024. Ongoing costs of operation related to Alternative 2 are assumed to begin in 2025, and they are modeled on an annual cost basis.

Estimates are made for recurring annual operating expenses. The values for annual operating expenses are modeled as a constant expense for each year of the 10-year analysis horizon.

The staff performed a discounted cash flow calculation to discount these annual expenses to 2023-dollar values.

3.2.4 Discount Rates In accordance with NRCs guidance in NUREG/BR-0058 (NRC, 2020), net present value (NPV) calculations are used to determine how much society would need to invest today to ensure that the designated dollar amount is available in a given year in the future. By using NPV calculations, costs and benefits, regardless of when the cost or benefit is incurred, are valued to a reference year for comparison. The choice of a discount rate and its associated conceptual basis are topics of ongoing discussion within the Federal Government. Based on NRC past practice and guidance, present-worth calculations in this analysis use 3 percent and 7 percent real discount rates. A 3 percent discount rate approximates the real rate of return on long-term government debt, which serves as a proxy for the real rate of return on savings to reflect reliance on a social rate of time preference discounting concept.10 A 7 percent discount rate approximates the marginal pretax real rate of return on an average investment in the private sector, and it is the appropriate discount rate whenever the main effect of a regulation is to displace or alter the use of capital in the private sector. A 7 percent rate is consistent with an opportunity cost11 of capital concept to reflect the time value of resources directed to meet regulatory requirements.

10 The social rate of time preference discounting concept refers to the rate at which society is willing to postpone a marginal unit of current consumption in exchange for more future consumption.

11 Opportunity cost represents what is foregone by undertaking a given action. If the licensee personnel were not engaged in revising procedures, they would be performing other work activities. Throughout the analysis, the NRC estimates the opportunity cost of performing these incremental tasks as the industry personnels pay for the designated unit of time.

9 3.2.5 Cost/Benefit Inflators The staff estimated the analysis inputs for some attributes based on the values published in NUREG/BR-0058 (NRC, 2020), or other sources as referenced, which are provided in prior-year dollars. To evaluate the costs and benefits consistently, these inputs are put into base-year dollars. The most common inflator is the consumer price index for all urban consumers (CPI-U),

developed by the U.S. Department of Labor, Bureau of Labor Statistics (BLS). Using the CPI-U, the prior-year dollars are converted to 2023 base-year dollars. The following formula is used to determine the amount in 2023 base-year dollars from 2012:

=

Table 3 summarizes the values of CPI-U used in this regulatory analysis.

Table 3 CPI-U Inflator Year CPI-U Annual Average a 2022

$292.61 2023

$305.84 a Statista, 2023.

3.2.6 Labor Rates For the purposes of this regulatory analysis, the NRC applied incremental cost principles to develop labor rates that include only labor and material costs that are directly related to the implementation and operation and maintenance of the proposed rule requirements. This approach is consistent with the guidance in NUREG/CR-3568, A Handbook for Value-Impact Assessment, issued December 1983 (NRC, 1983), and general cost-benefit methodology. The NRC incremental labor rate is $143 per hour.12 The NRC used the 2022 BLS Occupational Employment and Wage (OEWS) data (BLS, 2022), which provide labor categories and the mean hourly wage rate by job type, and used the inflator discussed above to inflate these labor rate data to 2023 dollars. The labor rates used in the analysis reflect total hourly compensation, which includes wages and nonwage benefits (using a fringe factor of 2.4, applicable for Agreement State and industry employees). The NRC used the BLS data tables to select appropriate hourly labor rates for performing the anticipated tasks necessary during and following implementation of the proposed alternative. In establishing this labor rate, wages paid to the individuals performing the work plus the associated fringe benefit component of labor cost (i.e., insurance premiums, pension, and legally required benefits and the time for organization management exceeding those directly expensed) are considered incremental expenses and are included. The NRC used BLS labor rates at the 25th percentile, mean wage, and 75th percentile and adjusted to 2023 dollars as input into the uncertainty analysis, which is described in section 4. Table 4 shows the 2022, unburdened labor rates for industry, Agreement States, and Tribal governments.

12 The NRC labor rates presented here differ from those developed under the NRCs license fee recovery program (10 CFR Part 170, Fees for Facilities, Materials, Import and Export Licenses, and Other Regulatory Services under the Atomic Energy Act of 1954, as Amended). NRC labor rates for fee recovery purposes are appropriately designed for full-cost recovery of the services rendered and thus include nonincremental costs (e.g., overhead, administrative, and logistical support costs).

10 Table 4 Industry, Agreement State, and Tribal Government Labor Rates Position Title Occupation (SOC Code)

Hourly Mean Wage (2022 dollars)

Hourly 25th Percentile Wage (2022 dollars)

Hourly 75th Percentile Wage (2022 dollars)

Industry Labor Rates National Health and Safety Engineers, Except Mining Safety Engineers and Inspectors 172111

$49.79

$37.90

$61.44 Transportation, Storage, and Distribution Managers 113071

$52.36

$36.37

$62.62 Lawyers 231011

$78.74

$45.40

$100.47 Office and Administrative Support Occupations 430000

$21.90

$16.46

$25.00 Blended mean wage

$50.70

$34.03

$62.38 Agreement State Labor Rate State government, excluding schools and hospitals (OEWS designation)

Health and Safety Engineers, Except Mining Safety Engineers and Inspectors 172111

$54.36

$39.69

$65.09 Lawyers 231011

$49.71

$35.45

$61.04 Office and Administrative Support Occupations 430000

$22.63

$17.42

$26.88 Blended mean wage

$42.23

$30.85

$51.00 Tribal Government Labor Rate Local government, excluding schools and hospitals Lawyers 231011

$59.62

$40.45

$74.35 Office and Administrative Support Occupations 430000

$23.40

$17.49

$28.45 Blended mean wage

$41.51

$28.97

$51.40 3.2.7 Sign Conventions The sign conventions used in this analysis are that all favorable consequences for Alternative 2 are positive and all adverse consequences are negative. Negative values are shown using parentheses (e.g., negative $500 is displayed as ($500)).

3.2.8 Analysis Horizon The analysis horizon is 10 years based on the term of a license.

11 3.3 Industry Implementation The proposed rule would require industry category 1 materials licensees to train staff on the new requirements to provide advance notification to Tribal governments. However, licensees also already conduct training on providing advance notification to States for other types of shipments, so implementing the new requirements associated with the proposed rule should not impose any significant additional marginal training costs. Licensees would also incur costs to participate in the rulemaking process, which should be minimal, given that the rule is uncontroversial and uncomplex. Table 5 shows industry implementation costs.

Table 5 Industry Implementation Benefits (Costs)

Year Activity Hours Industry Hourly Rate Licensees Net Benefits (Costs)

Undiscounted 7% NPV 3% NPV 2023 Attend public meetings, review and comment on proposed rule and guidance 269

$125 N/A

($34,000)

($34,000)

($34,000) 2024 Attend public meetings, review and comment on final rule and guidance 202

$125 N/A

($25,000)

($24,000)

($24,000)

Total Benefits (Costs)

($59,000)

($58,000)

($58,000) a Totals may differ within and between tables due to rounding.

3.4 Industry Operation The proposed rule would require industry category 1 materials licensees to incur costs to determine which shipments of category 1 quantities of radioactive materials would pass within or across the boundaries of Tribal governments that have opted in to the Tribal Advance Notification program. Category 1 materials licensees already perform a similar procedure for notifying State governments, but this process may still be labor intensive given that Tribal boundaries are not coincident with State boundaries. Once a qualifying shipment is identified, the licensee would notify the appropriate Tribal government by email. If the licensee has already provided a Tribal government advance notification but then determines that it would need to change the schedule of the shipment or cancel the shipment outright, the licensee would need to notify the Tribal government by telephone. Licensees would also incur some costs for recordkeeping of notifications. Table 6 shows industry operation costs.

12 Table 6 Industry Operation Benefits (Costs)

Year Activity Hours Industry Hourly Rate Shipments Net Benefits (Costs)

Undiscounted 7% NPV 3% NPV 2025-2034 Identify Tribal government reservations crossed by shipments (truck and rail), and obtain Tribal government contact information 80.7

$125 1218

($1,229,000)

($778,000)

($1,003,000)

Send notification to Tribal government(s) by email 5.04

$125 1218

($77,000)

($49,000)

($63,000)

Notify Tribal government(s) by telephone if shipment schedule changes 1.61

$125 171

($3,000)

($2,000)

($3,000)

Notify Tribal government(s) by telephone if shipment is canceled 1.61

$125 11

($221)

($140)

($180)

Recordkeeping 10.1

$125 1218

($154,000)

($97,000)

($125,000)

Total Benefits (Costs)

($1,463,000)

($926,000)

($1,194,000) a Totals may differ within and between tables due to rounding.

3.5 NRC Implementation NRC development costs are the costs of preparing a regulation before its issuance and implementation. Such costs may include expenditures for research in support of this regulatory action, publishing notices of rulemaking, holding public meetings, responding to public comments, and preparing preliminary rule text. NRC implementation costs are those front-end costs necessary to put into force the regulatory action. They include actions such as performing rulemaking or developing procedures and guidance to assist licensees in complying with the final action. Costs already incurred, including those activities performed by the NRC in making the regulatory decision (e.g., development of the proposed rule), are viewed as sunk costs and are excluded from this analysis.

Development and implementation costs within the scope of this analysis of Alternative 2 would be the costs of preparing a final rule, as well as efforts on FAQ development associated with the rule, as shown in table 7. The NRC would prepare a set of FAQs in lieu of an update to NUREG-2155 during the proposed rulemaking activities. NRC activities performed to prepare and issue the proposed rule and associated supplemental guidance for public comment would be considered sunk costs.

13 Table 7 NRC Implementation Benefits (Costs)

Year Activity Hours NRC Hourly Rate Net Benefits (Costs)

Undiscounted 7% NPV 3% NPV 2024 Prepare final rule and supporting documents 1,523

$143

($218,000)

($203,000)

($211,000) 2024 Prepare final FAQs 61

$143

($9,000)

($8,000)

($8,000)

Total Benefits (Costs)

($227,000)

($211,000)

($219,000) a Totals may differ within and between tables due to rounding.

3.6 NRC Operation The NRC would expect to incur costs over the analysis horizon associated with collecting, reviewing, and updating contact information for the federally recognized Tribes electing to receive advance notifications. Because the NRC already updates this information for Tribes that participate in the Tribal Advance Notification program, the costs included here are the incremental costs that the NRC expects it would incur only for Tribes that would join as a result of the proposed rule. The NRC would also incur costs to publish the updated contact information in the FR and to the associated public website. Table 8 shows NRC operation costs.

Table 8 NRC Operation Benefits (Costs)

Year Activity Hours NRC hourly rate Tribes Net Benefits (Costs)

Undiscounted 7% NPV 3% NPV 2025-2034 Time to update Tribal government contact list information of newly participating Tribal governments per tribe 10.08 $143 12

($13,000)

($8,000)

($11,000)

Time to publicize updated contact information of newly participating Tribal governments per tribe 10

$143 12

($13,000)

($8,000)

($11,000)

Total Benefits (Costs)

($26,000)

($16,000)

($22,000) a Totals may differ within and between tables due to rounding.

3.7 Agreement State Implementation Agreement States would incur costs to develop and implement compatible regulations, as shown in table 9. The costs could vary significantly by State because of differences in internal procedures for developing regulations.

The proposed revisions to existing definitions and the proposed addition of new definitions would have to meet the Compatibility Category B definition13 as listed in the proposed rule FR 13 Under the Agreement State Program Policy Statement approved by the Commission on October 2, 2017, and published in the FR on October 18, 2017 (82 FR 48535), NRC program elements (including regulations) required for adequacy and having a particular health and safety component are those that are designated as Categories A, B, C, D, NRC, and Health and Safety; those required for compatibility include those regulations and other legally binding requirements designated as Compatibility Categories A, B, C, and D.

14 notice. As Compatibility Category B definitions need to be essentially the same, word-for-word, the process should be relatively simple.

Table 9 Agreement State Implementation Benefits (Costs)

Year Activity Hours Agreement States Hourly Rate Agreement States Net Benefits (Costs)

Undiscounted 7% NPV 3% NPV 2025 Agreement State develop and implement compatible regulations 210

$105 4114

($902,000)

($788,000)

($850,000)

Total Benefits (Costs)

($902,000)

($788,000)

($850,000) a Totals may differ within and between tables due to rounding.

3.8 Tribal Government Implementation The NRC assumes that every federally recognized Tribe, except for those located in Alaska,15 would incur rulemaking costs through review and comment on the proposed and final rule, but that those costs would be minimal. The NRC does not expect all the Tribes that incur those costs to join the Tribal Advance Notification program. Tribal governments would incur costs deciding on whether to opt in to the Tribal Advance Notification program and costs to notify the NRC of their intent to enroll in the program. Those costs include Tribal deliberations and clerical work to enroll. Based on prior experience with the Tribal Advance Notification program after issuance of the Advance Notification to Native American Tribes of Transportation of Certain Types of Nuclear Waste16 rule, the NRC assumes that not all Tribes that intend to participate in the program would opt in immediately after implementation of the proposed rule and that some Tribes would opt in up to 5 years later. Table 10 shows Tribal government implementation costs.

Table 10 Tribal Government Implementation Benefits (Costs)

Year Activity Hours Tribes Hourly Rate Tribes Net Benefits (Costs)

Undiscounted 7% NPV 3% NPV 2024 Review and comment on proposed rule 522

$103 N/A

($54,000)

($50,000)

($52,000) 2025 Review and comment on final rule 261

$103 N/A

($27,000)

($23,000)

($25,000)

Compatibility Category B pertains to a limited number of program elements that cross jurisdictional boundaries and should be addressed to ensure uniformity of regulation on a nationwide basis. The Agreement State program element should be essentially identical to that of the NRC. Compatibility Category C includes those program elements that do not meet the criteria of Category A or B, but an Agreement State should adopt its essential objectives to avoid conflict, duplication, gaps, or other conditions that would jeopardize an orderly pattern in regulating agreement material on a national basis. An Agreement State should adopt the essential objectives of the Category C program elements.

14 Includes the existing 39 Agreement States and Connecticut and Indiana which have submitted letters of intent to become Agreement States.

15 There are currently 229 federally recognized Tribes in Alaska. There are currently no category 1 material licensees in Alaska, so the NRC assumes the Tribes located in Alaska will not participate in the rulemaking process.

16 See Advance Notification to Native American Tribes of Transportation of Certain Types of Nuclear Waste rule, Volume 77 of the Federal Register (FR), page 34194 (77 FR 34194; June 11, 2012).

15 Year Activity Hours Tribes Hourly Rate Tribes Net Benefits (Costs)

Undiscounted 7% NPV 3% NPV 2025-2034 Determine whether to opt in 20.2

$103 12

($5,000)

($4,000)

($4,000)

Notify the NRC of intent to opt in 2.52

$103 12

($606)

($464)

($539)

Total Benefits (Costs)

($87,000)

($77,000)

($82,000) a Totals may differ within and between tables due to rounding.

3.9 Tribal Government Operation Tribal governments would incur annual costs associated with participating in the Tribal Advance Notification program, mainly from processing the different notifications, which would be clerical and routine in nature. The NRC also assumes that some of the costs would be associated with keeping contact information up to date, and participating Tribes would incur these costs annually. Table 11 shows Tribal government operation costs summed over the 2025-2034 period.

Table 11 Tribal Government Operation Benefits (Costs)

Year Activity Hours Tribal Government Hourly Rate Events Shipments Net Benefits (Costs)

Undiscounted 7% NPV 3% NPV 2025-2034 Update contact information 5.04

$103 163 N/A

($8,000)

($5,000)

($7,000)

Process advance notification 2.52

$103 N/A 1,218

($32,000)

($20,000)

($26,000)

Process schedule change 2.52

$103 N/A 171

($1,000)

($1,000)

($1,000)

Process cancellation 0.81

$103 N/A 11

($91)

($58)

($74)

Total Benefits (Costs)

($41,000)

($26,000)

($34,000) a Totals may differ within and between tables due to rounding.

3.10 Regulatory Efficiency The proposed rule would improve regulatory efficiency by removing the regulatory inconsistency between the Part 71 and Part 73 and Part 37 advance notification regulations for shipments of category 1 materials. After implementation of the rule, notifications available to Tribes would be consistent with those available to States. The rule would enhance the Advance Tribal Notification program by expanding the number of shipments that it covers, which would provide predictability and clarity to the Tribes that opt in to the program and to the public. In addition, the greater transparency provided by the rule regarding the number of category 1 shipments that pass within or across Tribal reservations would help the NRC document the basis for any action the NRC should choose to take in the future regarding category 1 shipments and Tribal governments.

16 Removing the requirement for fingerprinting Tribal officials who are designated to receive notifications would allow Tribes to more easily designate officials to receive such notifications, which would enable Tribes to be more effective in their day-to-day efforts to ensure the protection of nuclear materials and respond to emergencies within their reservations. Lastly, removing this requirement would avert the small amount of costs associated with the fingerprinting process.17 3.11 Other Considerations 3.11.1 Consistency with Tribal Policy Statement The proposed rule is consistent with Principle 2 of the NRCs Tribal Policy Statement, which states that the NRC recognizes the right of each Tribe to self-governance. The advance notifications provided to the Tribes under the proposed rule would support Tribal self-governance and sovereignty by providing additional information to aid Tribal governments with decision-making regarding Tribal territory. In addition, Principle 2 states that the NRC recognizes Tribal governments as independent from State governments, which are already eligible to receive advance notification regarding category 1 materials. The proposed rule would provide notifications to Tribal governments separately from the notifications received by the States.

3.11.2 Regulatory Flexibility Act The Regulatory Flexibility Act (5 U.S.C. 601 et seq.), enacted in September 1980, requires agencies to consider the impact of their regulatory proposals on small entities, analyze alternatives that minimize small entity impacts, and make their analyses available for public comment. The NRC uses the following size standards, codified at 10 CFR 2.810, NRC size standards, to qualify a licensee as a small entity:

A small business is a manufacturing concern with an average number of 500 or fewer employees based upon employment during each pay period for the preceding 12 calendar months.

A small organization is a not-for-profit organization that is independently owned and operated and has annual gross receipts of $8 million or less.

A small governmental jurisdiction is a government of a city, county, town, township, village, school district, or special district with a population of less than 50,000.

A small educational institution is one that is (1) supported by a qualifying small governmental jurisdiction or (2) not State or publicly supported and has 500 or fewer employees.

Small entities include small businesses, small governments, small nonprofits, and small educational institutions. The NRC does not anticipate this proposed rule to affect small nonprofits and small educational institutions. Tribal governments qualify as small entities. In addition, a portion of the category 1 material licensees will qualify as small businesses.

The NRC estimates that the average cost for implementation of the proposed rule by Tribal governments would be $4,660 per Tribe and that, by the end of the analysis horizon in 2034, 17 The NRC did not include these costs in its analysis because they are minimal and would not have a significant impact on the analysis.

17 Tribal governments would incur an undiscounted annual operational cost of participating in the program of $255 per Tribal government, per year. Tribal governments would incur costs under the proposed rule when determining whether to opt in to the Tribal Advance Notification program. Tribal governments that have opted in would incur operational costs to keep contact information updated and to process any notifications that they receive. They would also incur costs to participate in the rulemaking process. The NRC estimates that the average cost per licensee for implementation of the proposed rule would be $1,100 and that, by the end of the analysis horizon in 2034, licensees would incur an undiscounted annual operational cost of

$230 per year. Licensees would incur costs resulting from training staff on the new requirements in the proposed rule. However, the costs should be marginal as the licensees have existing training in place for notifications of shipments. Industry would also incur costs to participate in the rulemaking process.

Licensees affected by the rule have already implemented similar requirements in response to 10 CFR Part 71 and the Advance Tribal Notifications program. Tribes that already participate in the Tribal Advance Notification program also have already implemented similar requirements.

The NRC is not aware of any other relevant Federal rules that may duplicate, overlap, or conflict with the proposed rule.

4

SUMMARY

OF THE RESULTS 4.1 Summary This regulatory analysis identifies both quantifiable and nonquantifiable costs and benefits that would result from Alternative 2 (rulemaking). Although quantifiable costs and benefits appear to be more tangible, decisionmakers should not discount costs and benefits that cannot be quantified. Such benefits or costs can be as important as or even more important than benefits or costs that can be quantified and monetized.

4.1.1 Quantified Net Benefits Table 12 provides a summary of the estimated quantified benefits and costs for Alternative 2, compared to the regulatory baseline (Alternative 1).

4.1.2 Nonquantified Benefits In addition to the quantified costs, the NRC has analyzed numerous benefits and costs that could not be monetized but would affect the general public, industry, Agreement States, Tribal governments, and the NRC. Table 12 summarizes these benefits as well. The quantitative analysis used best estimate values.

Table 12 Summary of Totals Quantified Net Monetary Savings or (Costs)Total Present Value Nonquantified Benefits or (Costs)

Alternative 1: No Action

$0 None Alternative 2:

Industry:

($984,000) using a 7% discount rate

($1,252,000) using a 3% discount rate Benefits:

Public Health (accident) - Alternative 2 would allow Tribal governments to respond more quickly and comprehensively to any accident involving a category 1 shipment, thereby

18 Quantified Net Monetary Savings or (Costs)Total Present Value Nonquantified Benefits or (Costs)

NRC:

($229,000) using a 7% discount rate

($242,000) using a 3% discount rate Agreement States:

($788,000) using a 7% discount rate

($850,000) using a 3% discount rate Tribal Governments:

($104,000) using a 7% discount rate

($116,000) using a 3% discount rate Net Benefit (Cost):

($2,277,000) using a 7% discount rate

($2,677,000) using a 3% discount rate reducing the potential for public exposure to radiation.

Regulatory EfficiencyAlternative 2 would remove the inconsistency from the NRCs regulations between Part 71 and Part 73 and Part 37 concerning advance notifications to Tribal governments for shipments of category 1 materials and provide Tribal governments with the same information available to States.

Other ConsiderationsAlternative 2 would make the NRCs regulations concerning advance notifications of shipments of category 1 materials consistent with Principle 2 of the NRCs Tribal Policy Statement by respecting Tribal sovereignty and interest in self-governance and would also further the NRCs Principles of Good Regulation of openness and clarity.

a Totals may differ within and between tables due to rounding.

4.2 Uncertainty Analysis The NRC completed a Monte Carlo sensitivity analysis for this regulatory analysis using the specialty software @Risk. The Monte Carlo approach answers the question, What distribution of net costs and benefits results from multiple draws of the probability distribution assigned to key variables?

4.2.1 Uncertainty Analysis Assumptions The NRC analyzed the variables with the greatest uncertainty for estimating values. To conduct this analysis, the staff performed a Monte Carlo simulation using the @Risk software program.18 Monte Carlo simulations involve introducing uncertainty into the analysis by replacing the point estimates of the variables used to estimate base-case costs and benefits with probability distributions. By defining input variables as probability distributions instead of point estimates, the influence of uncertainty on the results of the analysis (i.e., the net benefits) can be effectively modeled.

The probability distributions chosen to represent the different variables in the analysis were bounded by the range-referenced input and the staffs professional judgment. When defining the probability distributions for use in a Monte Carlo simulation, summary statistics are needed to characterize the distributions. These summary statistics include the minimum, most likely, and maximum values of a triangular or trigen distribution19 and the minimum and maximum values of a program evaluation and review technique (PERT) distribution.20 Appendix A identifies the data elements; the distribution; and the low, most likely, and high estimates of the distribution that were used in the uncertainty analysis.

18 Information about this software is available at https://www.palisade.com.

19 A trigen distribution is a triangular distribution with three points representing a bottom percentile, a most likely value, and a top percentile.

20 A PERT distribution is a curved density distribution with three points representing specified minimum, most likely, and maximum values.

19 4.2.2 Uncertainty Analysis Results The NRC performed the Monte Carlo simulation by repeatedly recalculating the results 10,000 times. For each iteration, the values identified in appendix A were chosen randomly from the probability distributions that define the input variables. The values of the output variables were recorded for each iteration, and these values were used to define the resultant probability distribution.

For the analysis shown in each figure below, 10,000 simulations were run in which the key variables were changed to assess the resulting effect on costs and benefits. Figures 1 through 5 display the histograms of the incremental costs and benefits from the regulatory baseline (Alternative 1) for each affected entity and the total net benefit of the rule. The analysis shows that all affected entities will incur costs if this rule becomes effective.

Figure 1 Total industry costs (7 percent NPV)Alternative 2 5.0%

90.0%

5.0%

-1.660

-0.523

-3.00

-2.50

-2.00

-1.50

-1.00

-0.50 0.00 Values in Millions ($)

Industry / 7% NPV Minimum

-$2,697,000 Maximum

-$278,000 Mean

-$985,025 Std Dev

$352,037 Values 10000

20 Figure 2 Total NRC costs (7 percent NPV)Alternative 2 Figure 3 Total Agreement State costs (7 percent NPV)Alternative 2 5.0%

90.0%

5.0%

-0.975

-0.616

-1.20

-1.10

-1.00

-0.90

-0.80

-0.70

-0.60

-0.50

-0.40 Values in Millions ($)

Agreement States / 7% NPV Minimum

-$1,171,000 Maximum

-$482,000 Mean

-$786,813 Std Dev

$109,023 Values 10000

21 Figure 4 Tribal government costs (7 percent NPV)Alternative 2 Figure 5 Total net benefit (cost) (7 percent NPV)Alternative 2 Table 13 presents descriptive statistics for the uncertainty analysis.

5.0%

90.0%

5.0%

-133.00

-79.00

-180

-160

-140

-120

-100

-80

-60

-40 Values in Thousands ($)

Tribal Governments / 7%

NPV Minimum

-$177,000 Maximum

-$59,000 Mean

-$104,115 Std Dev

$16,441 Values 10000

22 Table 13 Descriptive Statistics for Uncertainty Results (7 Percent NPV)

Uncertainty Result Incremental Cost-Benefit (2023 Thousand Dollars)

Min Mean Max 5%

95%

Net Industry Benefit (Cost)

($2,697)

($985)

($278)

($1,660)

($523)

Net NRC Benefit (Cost)

($299)

($228)

($167)

($266)

($191)

Net Agreement State Benefit (Cost)

($1,171)

($787)

($482)

($975)

($616)

Net Tribal Government Benefit (Cost)

($171)

($104)

($59)

($133)

($79)

Total Net Benefit (Cost)

($4,024)

($2,104)

($1,179)

($2,832)

($1,580) a Totals may differ within and between tables due to rounding.

This table displays the key statistical results, including the 90 percent confidence interval in which the net benefits would fall between the 5 percent and 95 percent values.

Figure 6 shows a tornado diagram that identifies the main cost drivers for this proposed rulemaking. The largest cost driver is the number of Tribes that opt in to the Tribal Advance Notification program per year, followed by the industry labor rate and the total number of category 1 materials shipments that pass within or across a Tribal reservation boundary per year. These three variables are the largest cost drivers and generate the largest variations in the total net benefit due to uncertainty. The remaining variables in the figure have diminishing significance while the variables not shown on the figure have little to no significance and are suppressed from the figure.

The expected mean number of the category 1 quantity of radioactive material shipments that pass within or across a Tribal reservation boundary and the expected mean number of the category 1 quantity of radioactive material shipments that pass within or across two Tribal reservation boundaries have also been suppressed from the figure because they are used to calculate the total number of category 1 quantity of radioactive material shipments that pass within or across a Tribal reservation boundary per year and the number of category 1 quantity of radioactive material shipments that pass within or across two Tribes lands per year, respectively.

23 Figure 6 Top cost drivers for which uncertainty impacts the total net costs (7 percent NPV)Alternative 2 4.2.3 Summary of Uncertainty Analysis The simulation analysis shows that the estimated mean benefit (i.e., positive averted costs or savings) for this proposed rule is ($2,104,000) with 90 percent confidence that the net benefit is between ($2,832,000) and ($1,580,000) using a 7 percent discount rate. The NRCs quantitative estimates show that the rule alternative is not cost beneficial. However, a major assumption affecting this finding is that the number of category 1 material shipments that would require notification to Tribes that join the Tribal Advance Notification program after the final rule is comparable to the number of category 1 material shipments that would have required notification to the Tribes already in the Tribal Advance Notification program if the proposed rule was already in place. In other words, the assumption is that the rate of category 1 material shipments will remain the same over the analysis horizon as it was over the 2018-2022 period.

Variation in this number in either direction would have significant effects on costs.

4.3 Disaggregation The NRC performed a screening review to determine whether any of the individual requirements (or set of integrated requirements) of the proposed rule would be unnecessary to achieve the objectives of the rulemaking. The objective of this rulemaking is to provide to Tribal officials, or their designees, advance notice of shipments of category 1 quantities of radioactive material.

The NRC concludes that each of the rules requirements would be necessary to achieve the objectives of the rulemaking and found that the requirements considered separately would not mask the inclusion of any unnecessary requirements.

24 5 DECISION RATIONALE AND IMPLEMENTATION The assessment of total costs and benefits discussed previously leads the NRC to the conclusion that the proposed rule, if implemented, would provide benefits to regulatory efficiency and effectiveness for both the NRC and industry by enhancing the Advance Tribal Notification program and increasing its scope. The proposed rule would increase transparency for participating Tribal governments by providing a more complete picture of shipments with category 1 quantities of radioactive material and informing their interactions with stakeholders.

This could also provide benefits to the public, should any Tribal government need to respond to an accident involving a category 1 shipment, the information provided under the proposed rule may allow a more rapid and comprehensive response. The proposed rule would also be consistent with Principle 2 of the NRCs Tribal Policy Statement and would resolve an inconsistency between the NRCs shipment notification requirements, providing Tribes and States the same level of information about shipments of category 1 quantities of radioactive material. This would provide the NRC an important opportunity to respect Tribal sovereignty and to recognize Tribal rights to self-governance through enacting the proposed rule. Furthermore, the proposed rule represents an opportunity for the NRC to augment its Tribal outreach.

Although the proposed rule would not be quantitatively cost effective, the costs for Tribes would be marginal and the costs for the NRC, industry, and Agreement States would be incremental because of the existing regulatory regime that created the Advance Tribal Notification program.

Because most of the costs would be small and incremental, the analysis results would be sensitive to the number of Tribes that choose to participate in the Advance Tribal Notification program and the number of shipments of category 1 quantities of radioactive material.

The NRC assumed for this analysis that the effective date of any final rule would be in 2025.

Full implementation by the Agreement States would be approximately 3 years later. The agency would release a set of FAQs with the final rule.

Agreement States would have 3 years to make changes to their affected regulations.

25 6 REFERENCES 10 CFR Part 37. U.S. Code of Federal Regulations, Physical Protection of Category 1 and Category 2 Quantities of Radioactive Material. Part 37, Chapter I, Title 10, Energy.

10 CFR Part 71. U.S. Code of Federal Regulations, Packaging and Transportation of Radioactive Material. Part 71, Chapter I, Title 10, Energy.

10 CFR Part 73. U.S. Code of Federal Regulations, Physical Protection of Plants and Materials. Part 73, Chapter I, Title 10, Energy.

Office of Management and Budget (OMB, 2003), Regulatory Analysis, Circular A-4, September 17, 2003. Available at https://obamawhitehouse.archives.gov/omb/circulars_a004_a-4/.

Statistica Research Department (Statistica, 2023), Projected Consumer Price Index in the United States from 2010 to 2028. Available at https://www.statista.com/statistics/244993/projected-consumer-price-index-in-the-united-states/;

last accessed on May 11, 2023.

U.S. Department of Labor, Bureau of Labor Statistics (BLS, 2022), May 2019 National Occupational Employment and Wage Estimates. Available at https://www.bls.gov/oes/data.htm; last accessed on May 11, 2023.

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U.S. Nuclear Regulatory Commission (NRC, 2020), Regulatory Analysis Guidelines of the U.S. Nuclear Regulatory Commission, NUREG/BR-0058, draft Revision 5, April 2017 (ML17100A480).

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A-1 APPENDIX A UNCERTAINTY ANALYSIS VARIABLES Activity Mean Estimate Distribution Low Estimate Best Estimate High Estimate General Base year 2023 Year rule is active 2025 Year Agreement State rule is active 2028 Analysis horizon 2034 Discount rate 7%

Supplemental discount rate 3%

NRC staff labor rate

$143 NRC full-time equivalent hours 1,510 National full-time equivalent hours 2,080 Labor rate multiplier 2.4 Number of Agreement States 4121 Number of shipments passing within or across all participating Tribal reservations per year 35.6 Number of shipments passing within or across two reservations per year 4.4 Estimated number of shipments passing within or across a Tribal reservation per year 5.93 Shipments changed per year 14%

Shipments canceled per year 0.9%

NRC licensees authorized to possess category 1 materials 87 Agreement State licensees authorized to possess category 1 materials 624 Tribes automatically enrolled in notifications when rule becomes effective 7

Number of Tribes opting in per year 2.33 Triangular 0

1 6

Number of category 1 shipments passing within or across Tribal reservations per year per participating Tribe 5.98 PERT 4

5.93 8

Industry labor rate 125.09 PERT

$85

$127

$156 Agreement State staff labor rate 104.85 PERT

$77

$106

$128 Tribal labor rate 103.02 PERT

$73

$104

$129 NRC Implementation Rulemaking Prepare proposed rule and supporting documents 1,523 hours0.00605 days <br />0.145 hours <br />8.647487e-4 weeks <br />1.990015e-4 months <br /> PERT 1,133 1,510 1,963 21 Includes the existing 39 Agreement States and Connecticut and Indiana which have submitted letters of intent to become Agreement States.

A-2 Activity Mean Estimate Distribution Low Estimate Best Estimate High Estimate Prepare draft frequently asked questions 81 hours9.375e-4 days <br />0.0225 hours <br />1.339286e-4 weeks <br />3.08205e-5 months <br /> PERT 60 80 104 Prepare final rule and supporting documents 1,523 hours0.00605 days <br />0.145 hours <br />8.647487e-4 weeks <br />1.990015e-4 months <br /> PERT 1,133 1,510 1,963 Prepare final frequently asked questions 61 hours7.060185e-4 days <br />0.0169 hours <br />1.008598e-4 weeks <br />2.32105e-5 months <br /> PERT 45 60 78 NRC Operation Time to update Tribal government contact list information of newly participating Tribal governments per tribe 1 hours1.157407e-5 days <br />2.777778e-4 hours <br />1.653439e-6 weeks <br />3.805e-7 months <br /> PERT 1

1 1

Time to publicize updated contact information of newly participating Tribal governments per tribe 1 hours1.157407e-5 days <br />2.777778e-4 hours <br />1.653439e-6 weeks <br />3.805e-7 months <br /> PERT 1

1 1

Industry Implementation Rulemaking Attend public meetings, review and comment on proposed rule and guidance 269 hours0.00311 days <br />0.0747 hours <br />4.447751e-4 weeks <br />1.023545e-4 months <br /> PERT 200 267 347 Attend public meetings, review and comment on final rule and guidance 202 hours0.00234 days <br />0.0561 hours <br />3.339947e-4 weeks <br />7.6861e-5 months <br /> PERT 150 200 260 Industry Operation Identify participating Tribal government reservations that shipments pass within or across by truck and rail, and obtain Tribal government contact information 8.07 hours8.101852e-5 days <br />0.00194 hours <br />1.157407e-5 weeks <br />2.6635e-6 months <br /> PERT 6.00 8.00 10.40 Send notification to participating Tribal government(s) by email 0.50 hour5.787037e-4 days <br />0.0139 hours <br />8.267196e-5 weeks <br />1.9025e-5 months <br /> PERT 0.38 0.50 0.65 Notify Tribal government(s) by telephone if shipment schedule changes 0.16 hour1.851852e-4 days <br />0.00444 hours <br />2.645503e-5 weeks <br />6.088e-6 months <br /> PERT 0.12 0.16 0.21 Notify Tribal government(s) by telephone if shipment is canceled 0.16 hour1.851852e-4 days <br />0.00444 hours <br />2.645503e-5 weeks <br />6.088e-6 months <br /> PERT 0.12 0.16 0.21 Recordkeeping 1.01 hours1.157407e-5 days <br />2.777778e-4 hours <br />1.653439e-6 weeks <br />3.805e-7 months <br /> PERT 0.75 1.00 1.30 Agreement State Implementation Rulemaking Agreement States develop and implement compatible regulations 210 hours0.00243 days <br />0.0583 hours <br />3.472222e-4 weeks <br />7.9905e-5 months <br /> PERT 156 208 270 Tribal Government Implementation Rulemaking Review and comment on proposed rule 522 hours0.00604 days <br />0.145 hours <br />8.630952e-4 weeks <br />1.98621e-4 months <br /> PERT 389 518 673 Review and comment on final rule 261 hours0.00302 days <br />0.0725 hours <br />4.315476e-4 weeks <br />9.93105e-5 months <br /> PERT 194 259 337 Determine whether to opt in 4.03 hours3.472222e-5 days <br />8.333333e-4 hours <br />4.960317e-6 weeks <br />1.1415e-6 months <br /> PERT 3

4 5

Notify NRC of intent to opt in 0.50 hour5.787037e-4 days <br />0.0139 hours <br />8.267196e-5 weeks <br />1.9025e-5 months <br /> PERT 0.38 0.50 0.65 Tribal Government Operation Update contact information 0.50 hour5.787037e-4 days <br />0.0139 hours <br />8.267196e-5 weeks <br />1.9025e-5 months <br /> PERT 0.38 0.50 0.65 Process advance notification 0.25 hour2.893519e-4 days <br />0.00694 hours <br />4.133598e-5 weeks <br />9.5125e-6 months <br /> PERT 0.19 0.25 0.33 Process schedule change 0.08 hour9.259259e-5 days <br />0.00222 hours <br />1.322751e-5 weeks <br />3.044e-6 months <br /> PERT 0.06 0.08 0.10 Process cancellation 0.08 hour9.259259e-5 days <br />0.00222 hours <br />1.322751e-5 weeks <br />3.044e-6 months <br /> PERT 0.06 0.08 0.10 a Totals may differ within and between tables due to rounding.