AGENCY:

Nuclear Regulatory Commission.

ACTION:

Proposed rule.

SUMMARY:

The U.S. Nuclear Regulatory Commission (NRC) is proposing to amend the licensing, inspection, special project, and annual fees charged to its applicants and licensees. These proposed amendments are necessary to implement the Omnibus Budget Reconciliation Act of 1990, as amended (OBRA-90), which requires the NRC to recover approximately 90 percent of its annual budget through fees less certain amounts excluded from this fee-recovery requirement. President Trump signed the Energy and Water, Legislative Branch, and Military Construction and Veterans Affairs Appropriations Act, 2019 on September 21, 2018. That Act appropriated approximately $911.0 million to the NRC, which is a decrease of approximately $11.0 million from FY 2018. Based on that total budget authority, the NRC is proposing to collect $781.9 million in fees in FY 2019.

DATES:

Submit comments by March 4, 2019. Comments received after this date will be considered if it is practical to do so, but the NRC is able to ensure consideration only for comments received before this date. Because OBRA-90 requires the NRC to collect the FY 2019 fees by September 30, 2019, the NRC will not grant any requests for an extension of the comment period.

ADDRESSES:

You may submit comments by any of the following methods (unless this document describes a different method for submitting comments on a specific subject):

• Federal Rulemaking Website: Go to http://www.regulations.gov and search for Docket ID NRC-2017-0032. Address questions about NRC dockets to Carol Gallagher; telephone: 301-415-3463; email: Carol.Gallagher@nrc.gov. For technical questions, contact the individual listed in the FOR FURTHER INFORMATION CONTACT section of this proposed rule.
• Email comments to: Rulemaking.Comments@nrc.gov. If you do not receive an automatic email reply confirming receipt, then contact us at 301-415-1677.
• Fax comments to: Secretary, U.S. Nuclear Regulatory Commission at 301-415-1101.
• Mail comments to: Secretary, U.S. Nuclear Regulatory Commission, Washington, DC 20555-0001, ATTN: Rulemakings and Adjudications Staff.
• Hand deliver comments to: 11555 Rockville Pike, Rockville, Maryland 20852, between 7:30 a.m. and 4:15 p.m. (Eastern Time) Federal workdays; telephone: 301-415-1677.

For additional direction on obtaining information and submitting comments, see “Obtaining Information and Submitting Comments” in the SUPPLEMENTARY INFORMATION section of this document.

FOR FURTHER INFORMATION CONTACT:

Michele Kaplan, Office of the Chief Financial Officer, U.S. Nuclear Regulatory Commission, Washington, DC 20555-0001, telephone: 301-415-5256; email: Michele.Kaplan@nrc.gov.

SUPPLEMENTARY INFORMATION:

Table of Contents

I. Obtaining Information and Submitting Comments

II. Background; Statutory Authority

III. Specific Request for Comment: Petition for Rulemaking

IV. Discussion

V. Regulatory Flexibility Certification

VI. Regulatory Analysis

VII. Backfitting and Issue Finality

VIII. Plain Writing

IX. National Environmental Policy Act

X. Paperwork Reduction Act

Public Protection Notification

XI. Voluntary Consensus Standards

XII. Availability of Guidance

XIII. Public Meeting

XIV. Availability of Documents

I. Obtaining Information and Submitting Comments

A. Obtaining Information

Please refer to Docket ID NRC-2017-0032 when contacting the NRC about the availability of information for this action. You may obtain publicly-available information related to this action by any of the following methods:

• Federal Rulemaking Website: Go to http://www.regulations.gov and search for Docket ID NRC-2017-0032.
• NRC's Agencywide Documents Access and Management System (ADAMS): You may obtain publicly-available documents online in the ADAMS Public Documents collection at http://www.nrc.gov/​reading-rm/​adams.html. To begin the search, select “Begin Web-based ADAMS Search.” For problems with ADAMS, please contact the NRC's Public Document Room (PDR) reference staff at 1-800-397-4209 or 301-415-4737, or by email to pdr.resource@nrc.gov. The ADAMS accession number for each document referenced in this document (if that document is available in ADAMS) is provided the first time that a document is referenced. For the convenience of the reader, the ADAMS accession numbers are also provided in a table in the “Availability of Documents” section of this document.
• NRC's PDR: You may examine and purchase copies of public documents at the NRC's PDR, Room O1-F21, One White Flint North, 11555 Rockville Pike, Rockville, Maryland 20852.

B. Submitting Comments

Please include Docket ID NRC-2017-0032 in the subject line of your comment submission in order to ensure that the NRC is able to make your comment submission publicly available in this docket.

The NRC cautions you not to include identifying or contact information that you do not want to be publicly disclosed in your comment submission. The NRC posts all comment submissions at http://www.regulations.gov as well as entering the comment submissions into ADAMS. The NRC does not routinely edit comment submissions to remove identifying or contact information.

If you are requesting or aggregating comments from other persons for submission to the NRC, then you should inform those persons not to include identifying or contact information that they do not want to be publicly disclosed in their comment submissions. Your request should state that the NRC does not routinely edit comment submissions to remove such information before making the comment submissions available to the public or entering the comment submissions into ADAMS.

II. Background; Statutory Authority

The NRC's fee regulations are primarily governed by two laws: (1) The Independent Offices Appropriation Act, 1952 (IOAA) (31 U.S.C. 9701), and (2) OBRA-90 (42 U.S.C. 2214). The IOAA generally authorizes and encourages Federal regulatory agencies to recover—to the fullest extent possible—costs attributable to services provided to identifiable recipients. The OBRA-90 requires the NRC to recover approximately 90 percent of its budget authority for the fiscal year through fees; in FY 2019, amounts appropriated for the development of regulatory infrastructure for advanced reactor technologies, international activities, Waste Incidental to Reprocessing, generic homeland security activities, and Inspector General services for the Defense Nuclear Facilities Safety Board are excluded from this fee-recovery requirement. The OBRA-90 first requires the NRC to use its IOAA authority to collect service fees for NRC work that provides specific benefits to identifiable applicants and licensees (such as licensing work, inspections, and special projects). The regulations at part 170 of title 10 of the Code of Federal Regulations (10 CFR) authorize these fees. But, because the NRC's fee recovery under the IOAA (10 CFR part 170) does not equal 90 percent of the NRC's budget authority for the fiscal year, the NRC also assesses “annual fees” under 10 CFR part 171 to recover the remaining amount necessary to meet OBRA-90's fee-recovery requirement. These annual fees recover costs that are not otherwise collected through 10 CFR part 170.

III. Specific Request for Comment: Petition for Rulemaking (PRM-170-7; NRC-2018-0172)

The NRC welcomes general comments on this proposed rule; in addition, the NRC is requesting public comment on the issues raised in a petition for rulemaking (ADAMS Accession No. ML18214A757), dated July 3, 2018, which was submitted to the NRC by Christopher S. Pugsley, Esq. (the petitioner), on behalf of Water Remediation Technology (WRT), LLC. The petitioner requests that the NRC amend its regulations regarding full cost recovery of licensee fees. The petition was docketed by the NRC on August 2, 2018, and was assigned Docket No. PRM-170-7. The NRC published a notice of docketing in the Federal Register on November 2, 2018 (83 FR 55113), but did not request public comment at that time. Please include Docket ID NRC-2018-0172 in the subject line of your comment submission in order to ensure that the NRC is able to make your comment submission publicly available in the petition's docket. You may submit comments on this petition using the methods listed in the ADDRESSES section of this document.

The petitioner requests that the NRC amend its regulations to re-categorize WRT as a licensee that does not require full-cost recovery for fees billed to it during the life of its license under 10 CFR part 170. The petitioner also requests that the NRC address consistency issues between 10 CFR parts 170 and 171 for small entities, and consider amending language under § 170.11 to extend the time within which a licensee may appeal the assessment of fees and apply for a fee exemption. The petitioner has asked the NRC to consider these rule changes within the context of its rulemaking to amend 10 CFR parts 170 and 171 to collect FY 2019 fees. See the FY 2019 Policy Change section of this document for additional information.

IV. Discussion

FY 2019 Fee Collection—Overview

The NRC is issuing this FY 2019 proposed fee rule based on the Energy and Water, Legislative Branch, and Military Construction and Veterans Affairs Appropriations Act, 2019 (Pub. L. 155-244) (enacted budget). The total enacted budget for the NRC in FY 2019 is approximately $911.0 million, a decrease of approximately $11.0 million from FY 2018. As explained previously, certain portions of the NRC's total budget are excluded from OBRA-90's fee-recovery requirement. Based on the FY 2019 enacted budget, these exclusions total to $43.4 million, consisting of $16.1 million for international activities, $10.3 million for advanced reactor technologies regulatory infrastructure, $1.3 million for Waste Incidental to Reprocessing activities, $1.1 million for Inspector General services for the Defense Nuclear Facilities Safety Board, and $14.6 million for generic homeland security activities. Additionally, OBRA-90 requires the NRC to recover only approximately 90 percent of the remaining budget authority for the fiscal year—10 percent of the remaining budget authority is not recovered through fees. The NRC refers to the activities included in this 10-percent as “fee-relief” activities. After accounting for the fee-recovery exclusions, the fee-relief activities, and net billing adjustments (i.e., the sum of unpaid current year invoices (estimated) minus payments for prior year invoices), the NRC must bill approximately $781.9 million in fees in FY 2019. Of this amount, the NRC estimates that $246.7 million will be recovered through 10 CFR part 170 service fees; that leaves approximately $535.2 million to be recovered through 10 CFR part 171 annual fees. Table I summarizes the fee-recovery amounts for the FY 2019 proposed fee rule using the enacted budget, and taking into account excluded activities, fee-relief activities, and net billing adjustments. For all information presented in the following tables, individual values may not sum to totals due to rounding. Please see the work papers (ADAMS Accession No. ML18361A780) for actual amounts.

FY 2019 Fee Collection—Professional Hourly Rate

The NRC uses a professional hourly rate to assess fees for specific services provided by the NRC under 10 CFR part 170. The professional hourly rate also helps determine flat fees (which are used for the review of certain types of license applications). This rate would be applicable to all activities for which fees are assessed under §§ 170.21 and 170.31.

The NRC's professional hourly rate is derived by adding budgeted resources for: (1) Mission-direct program salaries and benefits; (2) mission-indirect program support; and (3) agency support (corporate support and the Inspector General), and then subtracting certain offsetting receipts, and then dividing this total by the mission-direct full-time equivalents (FTE) converted to hours. The mission-direct FTE converted to hours is the product of the mission-direct FTE multiplied by the estimated annual mission-direct FTE productive hours. The only budgeted resources excluded from the professional hourly rate are those for mission-direct contract resources, which are generally billed to licensees separately. The following shows the professional hourly rate calculation:

For FY 2019, the NRC is proposing to increase the professional hourly rate from $275 to $278. The 1.1 percent increase in the FY 2019 professional hourly rate is due primarily to the decline in the number of mission-direct FTE compared to FY 2018, offset by the slight decrease in total budgeted resources. The number of mission-direct FTE declined by 41, primarily due to the standardization and centralization of mission support functions within the programmatic offices, and the transition of Wyoming to status as an Agreement State. The FY 2019 estimate for annual mission-direct FTE productive hours is 1,510 hours, which is unchanged from FY 2018. This estimate, also referred to as the productive hours assumption, reflects the average number of hours that a mission-direct employee spends on mission-direct work in a given year. This estimate therefore excludes hours charged to annual leave, sick leave, holidays, training, and general administration tasks. Table II shows the professional hourly rate calculation methodology. The FY 2018 amounts are provided for comparison purposes.

FY 2019 Fee Collection—Flat Application Fee Changes

The NRC proposes to amend the flat application fees that it charges to applicants for materials licenses and other regulatory services, and holders of materials licenses in its schedule of fees in §§ 170.21 and 170.31 to reflect the revised professional hourly rate of $278. The NRC calculates these flat fees by multiplying the average professional staff hours needed to process the licensing actions by the proposed professional hourly rate for FY 2019. The NRC analyzes the actual hours spent performing licensing actions and then estimates the average professional staff hours that are needed to process licensing actions as part of its biennial review of fees, which is required by Section 205(a) of the Chief Financial Officers Act of 1990 (31 U.S.C. 902(a)(8)). The NRC performed this review in FY 2019 and will perform this review again in FY 2021. The biennial review adjustments and the higher professional hourly rate of $278 are the primary reasons for the increase in application fees. Please see the work papers for more detail.

The NRC rounds these flat fees in such a way that ensures both convenience for its stakeholders and that any rounding effects are minimal. Accordingly, fees under $1,000 are rounded to the nearest $10, fees between $1,000 and $100,000 are rounded to the nearest $100, and fees greater than $100,000 are rounded to the nearest $1,000.

The proposed licensing flat fees are applicable for certain materials licensing actions (see fee categories 1.C. through 1.D., 2.B. through 2.F., 3.A. through 3.S., 4.B. through 5.A., 6.A. through 9.D., 10.B., 15.A. through 15.L., 15.R., and 16 of § 170.31). Because the enacted budget excludes international activities from the fee-recoverable budget, the NRC is not proposing to charge flat fees for import and export licensing actions of § 170.21. Applications filed on or after the effective date of the FY 2019 final fee rule will be subject to the revised fees in the final rule.

FY 2019 Fee Collection—Fee-Relief and Low-Level Waste (LLW) Surcharge

As previously noted, OBRA-90 requires the NRC to recover only approximately 90 percent of its annual budget authority for the fiscal year. The NRC applies the remaining 10 percent that is not recovered to offset certain budgeted activities—see Table III for a full listing of these “fee-relief” activities. If the amount budgeted for these fee-relief activities is greater or less than 10 percent of the NRC's annual budget authority (less the fee-recovery exclusions), then the NRC applies a fee adjustment (either an increase or decrease) to all licensees' annual fees, based on their percentage share of the NRC's budget.

In FY 2019, the amount budgeted for fee-relief activities is less than the 10 percent threshold. Therefore, the NRC proposes to assess a fee-relief credit that decreases all licensees' annual fees based on their percentage share of the budget. Table III summarizes the fee-relief activities budgeted for FY 2019. The FY 2018 amounts are provided for comparison purposes.

Table IV shows how the NRC proposes to allocate the $0.2 million fee-relief credit to each licensee fee class. Due to the transition of Wyoming to Agreement State status, the NRC is proposing to expand the existing fee relief category, “In situ leach rulemaking and unregistered general licensees,” to include additional uranium recovery program budgeted resources. This ensures the equitability and stability of annual fees for the uranium recovery fee class by recognizing that now the majority of uranium recovery licensees are in Agreement States.

In addition to the fee-relief credit, the NRC also proposes to assess a generic LLW surcharge of $3.8 million. Disposal of LLW occurs at commercially operated LLW disposal facilities that are licensed by either the NRC or an Agreement State. Four existing LLW disposal facilities in the United States accept various types of LLW. All are located in Agreement States and, therefore, are regulated by an Agreement State, rather than the NRC. The NRC proposes to allocate this surcharge to its licensees based on data available in the U.S. Department of Energy's (DOE) Manifest Information Management System. This database contains information on total LLW volumes and NRC usage information from four generator classes: Academic, industrial, medical, and utility. The ratio of utility waste volumes to total LLW volumes over a period of time is used to estimate the portion of this surcharge that will be allocated to the power reactors, fuel facilities, and materials fee classes. The materials portion is adjusted to account for the fact that a large percentage of materials licensees are licensed by the Agreement States rather than the NRC.

Table IV shows the surcharge, and its proposed allocation across the various fee classes.

FY 2019 Fee Collection—Revised Annual Fees

In accordance with SECY-05-0164, “Annual Fee Calculation Method,” dated September 15, 2005 (ADAMS Accession No. ML052580332), the NRC rebaselines its annual fees every year. “Rebaselining” entails analyzing the budget in detail and then allocating the budgeted costs to various classes or subclasses of licensees. It also includes updating the number of NRC licensees in its fee calculation methodology.

The NRC proposes to revise its annual fees in §§ 171.15 and 171.16 to recover approximately 90 percent of the NRC's FY 2019 enacted budget (less the fee-recovery exclusions and the estimated amount to be recovered through 10 CFR part 170 fees). The estimated 10 CFR part 170 collections for this proposed rule are $246.7 million, a decrease of $34.1 million from the FY 2018 fee rule (see the specific fee class sections for a discussion of this decrease). The NRC, therefore, proposes to recover $535.2 million through annual fees from its licensees, which is an increase of $26.7 million from the FY 2018 final rule.

Table V shows the proposed rebaselined fees for FY 2019 for a representative list of categories of licensees. The FY 2018 amounts are provided for comparison purposes.

The work papers that support this proposed rule show in detail how the NRC proposes to allocate the budgeted resources for each class of licensees and calculate the fees. Paragraphs a. through h. of this section describe budgeted resources allocated to each class of licensees and the calculations of the rebaselined fees. For more information about detailed fee calculations for each class, please consult the accompanying work papers.

a. Operating Power Reactors

The NRC proposes to collect $460.3 million in annual fees from the power reactor fee class in FY 2019, as shown in Table VI. The FY 2018 fees and percentage change are shown for comparison purposes.

In comparison to FY 2018, the operating power reactors budgeted resources increased minimally in FY 2019. But estimated billings under 10 CFR part 170 declined primarily due to decreases in both licensing actions and inspections resulting from the shutdown of the Oyster Creek reactor at the end of FY 2018, the planned shutdown of Pilgrim and Three Mile Island reactors during FY 2019, and the completion of the APR1400 design certification for Korea Hydro and Nuclear Power Co., LTD. Additionally, estimated billings under 10 CFR part 170 are expected to decline due to the replacement of the 6 percent automatic overhead charge for project manager, resident inspector, and senior resident inspector activities with new directly billed docket-related cost activity codes.

The recoverable budgeted costs are divided equally among the 98 licensed power reactors, resulting in a proposed annual fee of $4,697,000 per reactor. Additionally, each licensed power reactor is assessed the FY 2019 spent fuel storage/reactor decommissioning proposed annual fee of $163,000 (see Table VII and the discussion that follows). The combined proposed FY 2019 annual fee for power reactors is, therefore, $4,860,000.

On May 24, 2016, the NRC amended its licensing, inspection, and annual fee regulations to establish a variable annual fee structure for light-water small modular reactors (SMRs). Under the variable annual fee structure, effective June 23, 2016, an SMR's annual fee would be calculated as a function of its licensed thermal power rating. Currently, there are no operating SMRs; therefore, the NRC is not proposing an annual fee in FY 2019 for this type of licensee.

b. Spent Fuel Storage/Reactor Decommissioning

The NRC proposes to collect $19.9 million in annual fees from 10 CFR part 50 power reactors, and from 10 CFR part 72 licensees that do not hold a 10 CFR part 50 license, to collect the budgeted costs for the spent fuel storage/reactor decommissioning fee class.

Compared to FY 2018, the FY 2019 budgeted resources for spent fuel storage/reactor decommissioning increased due to: (1) An increase in the number of financial reviews and licensing actions associated with operating power reactors undergoing decommissioning, (2) the ongoing licensing reviews for two consolidated Interim storage facility license applications including the development of environmental impact statements, and (3) the independent spent fuel storage installation license renewal for Three Mile Island-2, Trojan, and Rancho Seco and the associated environmental assessments.

The 10 CFR part 170 estimated billings for FY 2019 increased due to (1) resuming licensing work on Interim Storage Partner's consolidated interim storage facility application, (2) increasing work on Holtec International's consolidated interim storage facility application, and (3) an increased workload for reactors in decommissioning.

The annual fee decreased due to rising 10 CFR part 170 estimated billings. The required annual fee recovery amount is divided equally among 122 licensees, resulting in a proposed FY 2019 annual fee of $163,000 per licensee.

c. Fuel Facilities

The NRC proposes to collect $24.8 million in annual fees from the fuel facilities class.

In comparison to FY 2018, the fuel facilities budgeted resources decreased in FY 2019, primarily due to aligning resources with a smaller projected workload.

The estimated 10 CFR part 170 collections decreased in FY 2019 as a result of the expected termination of the CB&I AREVA MOX Fuel Fabrication facility construction authorization and license application withdrawal, and the expected completion of Honeywell's license renewal, offset by increased work for Westinghouse associated with an emergency preparedness exercise, confirmatory order items and its license renewal.

The NRC proposes to continue allocating annual fees to individual fuel facility licensees based on the effort/fee determination matrix developed in the FY 1999 final fee rule (64 FR 31447; June 10, 1999). To briefly recap, the matrix groups licensees within this fee class into various fee categories. The matrix lists processes conducted at licensed sites and assigns effort factors for the safety and safeguards activities associated with each process (these effort levels are reflected in Table IX). The annual fees are then distributed across the fee class based on the regulatory effort predicted by the matrix.

In FY 2019, the total remaining required annual fee recovery amount of $24.8 million is comprised of safety activities, safeguards activities and the fee-relief adjustment/LLW surcharge. For FY 2019, the total budgeted resources to be recovered as annual fees for safety activities are $13.7 million. To calculate the annual fee, the NRC allocates this amount to each fee category based on its percent of the total regulatory effort for safety activities. Similarly, the NRC allocates the budgeted resources to be recovered as annual fees for safeguards activities, $10.3 million, to each fee category based on its percent of the total regulatory effort for safeguards activities. Finally, the fuel facility fee class' portion of the fee-relief adjustment/LLW surcharge—$0.8 million—is allocated to each fee category based on its percentage of the total regulatory effort for both safety and safeguards activities. The annual fee per licensee is then calculated by dividing the total allocated budgeted resources for the fee category by the number of licensees in that fee category. The fee for each facility is summarized in Table X.

d. Uranium Recovery Facilities

The NRC proposes to collect $0.2 million in annual fees from the uranium recovery facilities fee class, a decrease of 60.0 percent from FY 2018.

In comparison to FY 2018, the FY 2019 budgeted resources for uranium recovery licensees decreased due to the transition of Wyoming to Agreement State status and subsequent realignment of the Uranium Mill Tailings Radiation Control Act (UMTRCA) program. In addition, budgeted resources decreased as a result of expanding the existing fee-relief category, “In Situ leach rulemaking and unregistered general licenses” to include additional Uranium Recovery activities in order to ensure equitability and the stability of annual fees.

The NRC regulates DOE's Title I and Title II activities under UMTRCA ^[5] and the proposed annual fee to DOE includes the costs specifically budgeted for the NRC's UMTRCA Title I and II activities, as well as 10 percent of the remaining budgeted costs for this fee class. The DOE's UMTRCA annual fee decreased slightly due to the budgeted resources reduction and an increase in estimated 10 CFR part 170 billings for work on the Atlantic Richfield review. The NRC assesses the remaining 90 percent of its budgeted costs to the remaining licensee in this fee class, as described in the work papers. This is reflected in Table XII as follows:

Further, for the non-DOE licensees, the NRC continues to use a matrix to determine the effort levels associated with conducting the generic regulatory actions for the different licensees in this fee class; this is similar to the NRC's approach for fuel facilities, described previously.

The matrix methodology for uranium recovery licensees first identifies the licensee categories included within this fee class (excluding DOE). These categories are: Conventional uranium mills and heap leach facilities; uranium In Situ Recovery (ISR) and resin ISR facilities; and mill tailings disposal facilities. The matrix identifies the types of operating activities that support and benefit these licensees, along with each activity's relative weight (for more information, see the work papers). Currently, there is only one remaining non-DOE licensee which is a Basic In Situ Recovery facility. Table XIII displays the benefit factors for the non-DOE licensee in that fee category:

The annual fee for the remaining non-DOE licensee is calculated by allocating 100 percent of the budgeted resources, as summarized in Table XIV.

e. Research and Test Reactors (Non-Power Reactors)

The NRC proposes to collect $0.316 million in annual fees from the research and test reactor licensee class.

For this fee class, the budgeted resources decreased due to projected application delays within the medical isotope production facilities for Shine and NorthWest Medical Isotopes. The 10 CFR part 170 estimated billings also decreased due to projected application delays within the medical isotope production facilities for Shine and NorthWest, offset by an increase in activity for Aerotest's startup inspection and license renewal application. The proposed FY 2019 annual fee decreased due to a decrease in budgeted resources, offset by a decline in estimated 10 CFR part 170 billings.

The required annual fee-recovery amount is divided equally among the four research and test reactors subject to annual fees and results in an FY 2019 annual fee of $79,000 for each licensee.

f. Rare Earth

The NRC has not allocated any budgeted resources to this fee class; therefore, the NRC is not proposing an annual fee in FY 2019.

g. Materials Users

The NRC proposes to collect $36.5 million in annual fees from materials users licensed under 10 CFR parts 30, 40, and 70.

The annual fee for these categories of materials users' licenses is developed as follows: Annual Fee = Constant × [Application Fee + (Average Inspection Cost/Inspection Priority)] + Inspection Multiplier × (Average Inspection Cost/Inspection Priority) + Unique Category Costs. The total annual fee recovery of $36.5 million proposed for FY 2019 shown in Table XVI consists of the following: $28.6 million for general costs, $7.5 million for inspection costs, $0.2 million for unique costs for medical licenses and $0.2 million for fee relief/LLW costs. To equitably and fairly allocate the $36.5 million required to be collected among approximately 2,600 diverse materials users licensees, the NRC continues to calculate the annual fees for each fee category within this class based on the 10 CFR part 170 application fees and estimated inspection costs for each fee category. Because the application fees and inspection costs are indicative of the complexity of the materials license, this approach provides a proxy for allocating the generic and other regulatory costs to the diverse fee categories. This fee-calculation method also considers the inspection frequency (priority), which is indicative of the safety risk and resulting regulatory costs associated with the categories of licenses.

The NRC proposes to both increase and decrease annual fees for licensees in this fee class in FY 2019 due to the results of the biennial review of fees. This analysis examines the actual hours spent in previous years performing licensing actions and then estimates the average professional staff hours that are needed to process similar licensing actions multiplied by the proposed professional hourly rate for FY 2019.

The constant multiplier is established to recover the total general costs (including allocated generic transportation costs) of $28.6 million. To derive the constant multiplier, the general cost amount is divided by the product of all fee categories (application fee plus the inspection fee divided by inspection priority) then multiplied by the number of licensees. This calculation results in a constant multiplier of 1.33 for FY 2019. The average inspection cost is the average inspection hours for each fee category multiplied by the professional hourly rate of $278. The inspection priority is the interval between routine inspections, expressed in years. The inspection multiplier is established in order to recover the $7.5 million in inspection costs. To derive the inspection multiplier, the inspection costs amount is divided by the product of all fee categories (inspection fee divided by inspection priority) then multiplied by the number of licensees. This calculation results in an inspection multiplier of 1.44 for FY 2019. The unique category costs are any special costs that the NRC has budgeted for a specific category of licenses. For FY 2019, unique category costs include approximately $0.2 million in budgeted costs for the implementation of revised 10 CFR part 35, “Medical Use of Byproduct Material,” which has been allocated to holders of NRC human-use licenses. Please see the work papers for more detail about this classification.

The annual fee assessed to each licensee also includes a share of the approximately $0.006 million fee-relief credit assessment allocated to the materials users fee class (see Table IV, “Allocation of Fee-Relief Adjustment and LLW Surcharge, FY 2019,” in Section IV, “Discussion,” of this document), and for certain categories of these licensees, a share of the approximately $0.2 million LLW surcharge costs allocated to the fee class. The proposed annual fee for each fee category is shown in the proposed revision to § 171.16(d).

h. Transportation

The NRC proposes to collect $1.2 million in annual fees to recover generic transportation budgeted resources. The FY 2018 values are shown for comparison purposes.

In comparison to FY 2018, the total budgeted resources for FY 2019 for generic transportation activities increased slightly due to an increase in the Certificates of Compliance (CoCs) for DOE (from 21 to 22) and an increased workload.

Consistent with the policy established in the NRC's FY 2006 final fee rule (71 FR 30721; May 30, 2006), the NRC recovers generic transportation costs unrelated to DOE by including those costs in the annual fees for licensee fee classes. The NRC continues to assess a separate annual fee under § 171.16, fee category 18.A. for DOE transportation activities. The amount of the allocated generic resources is calculated by multiplying the percentage of total CoCs used by each fee class (and DOE) by the total generic transportation resources to be recovered. The proposed annual fee increase for DOE is mainly due an increase in CoCs from 21 in FY 2018 to 22 in FY 2019.

This resource distribution to the licensee fee classes and DOE is shown in Table XVIII. Note that for the research and test reactors fee class, the NRC allocates the distribution to only those licensees that are subject to annual fees. Although four CoCs benefit the entire research and test reactor class, only 4 out of 31 research and test reactors are subject to annual fees. Consequently, the number of CoCs used to determine the proportion of generic transportation resources allocated to research and test reactors annual fees has been adjusted to 0.5 so the research and test reactors subject to annual fees are charged a fair and equitable portion of the total. For more information, see the work papers.

The NRC assesses an annual fee to DOE based on the 10 CFR part 71 CoCs it holds. The NRC, therefore, does not allocate these DOE-related resources to other licensees' annual fees because these resources specifically support DOE.

FY 2019—Policy Changes

The NRC proposes two policy changes for FY 2019:

Changes to Small Materials Users Fee Categories for Locations of Use

The NRC proposes to add one new fee subcategory under § 170.31, “Schedule of fees for materials licenses and other regulatory services, including inspections, and import and export licenses,” and § 171.16, “Annual fees: Materials licensees, holders of certificates of compliance, holders of sealed source and device registrations, holders of quality assurance program approvals, and government agencies licensed by the NRC.” Generally speaking, § 170.31 assigns the same fee to each licensee in the fee category, regardless of the amount of locations that the licensee is authorized to use. Yet for some of these fee categories, the NRC determined that it spends a disproportionate amount of time on licensees with six or more locations compared to licensees in the same fee category with fewer than six locations. Previously—in the FY 2015 final fee rule—the NRC therefore added three fee subcategories under one fee category, 3.L. (research and development broad scope). And in the FY 2018 final fee rule, the NRC added seven fee subcategories under, 3.A., 3.B., 3.C., 3.O., 3.P., 7.A. and 7.B. for licenses with six or more locations of use. For the FY 2019 fee rule, the NRC determined that there is one more category of licenses that is affected. Accordingly, the NRC proposes to add subcategories to this fee category:

• Medical licenses under fee category 7.C.

To more accurately reflect the cost of services provided by the NRC, this change would result in this fee category having subcategories for 1-5, 6-20, and more than 20 locations of use.

Eliminate a Fee Category

In response to comments received on the FY 2018 proposed fee rule, the NRC proposes to eliminate a fee category in §§ 170.31 and 171.16. The fee category is 2.A.(5)—Licenses that authorize the possession of source material related to removal of contaminants (source material) from drinking water.

Under current NRC regulations, an entity that removes uranium from drinking water at community water systems is viewed as a “2.A.(5) fee category” licensee for fee purposes.

Although the licensee recovers sufficient quantities of uranium to require an NRC license (or a license from an Agreement State), its licensed material is not sold for profit; rather, the licensed material is a waste product from its water treatment process. These types of “uranium recovery” licensees are therefore distinguishable from those licensees that profit from concentrating uranium as source material. The NRC believes that full cost recovery is not warranted for licensees that do not profit from concentrating uranium. Therefore, the NRC proposes to eliminate this fee category from §§ 170.31 and 171.16 and reclassify current and future licensees under this category to 2.F.—All other source material licenses.

FY 2019—Administrative Changes

The NRC also proposes to make an administrative change:

Change Small Entity Fees

The NRC conducted a biennial review in FY 2019 of small entity fees to determine whether the NRC should change those fees. The NRC used the fee methodology, developed in FY 2009, which applies a fixed percentage of 39 percent to the prior 2-year weighted average of materials users' fees when performing its biennial review. Based on this methodology, the NRC determined the new small entity fees for FY 2019 should be $4,500 for upper-tier small entities and $900 for lower-tier small entities. As a result of the NRC's FY 2019 biennial review using the same methodology, the NRC is now proposing to increase the upper tier small entity fee from $4,100 to $4,500 and increase the lower-tier fee from $850 to $900. This would constitute a 13-percent and 6-percent increase, respectively. The NRC believes these fees are reasonable and provide relief to small entities while at the same time recovering from those licensees some of the NRC's costs for activities that benefit them.

Update to the Fees Transformation Initiative

As an informal update, the Staff Requirements Memorandum, dated October 19, 2016, for SECY-16-0097, “Fee Setting Improvements and Fiscal Year 2017 Proposed Fee Rule,” directed staff to explore, as a voluntary pilot, whether a flat fee structure could be established for routine licensing matters in the area uranium recovery, and to accelerate the fees setting process improvements including the transition to an electronic billing system. With respect to the voluntary flat fees pilot, the staff has developed a project plan and is on target to complete this activity in FY 2020. With respect to the fees setting process improvements, all 7 of the activities scheduled for FY 2018 and an additional 10 scheduled for FY 2019 were completed by the end of FY 2018. These improvements included discontinuing the Project Manager/Resident inspector 6 percent overhead charge, enhancing the information included on the 10 CFR part 170 invoices, improving the fee rule work papers, and enhancing the financial management systems. For the remaining process changes recommended for future consideration, the NRC is well-positioned to complete them on schedule. For more information, please see our fees transformation accomplishments schedule, located on our license fees website at: https://www.nrc.gov/​about-nrc/​regulatory/​licensing/​fees-transformation-accomplishments.html.

V. Regulatory Flexibility Certification

As required by the Regulatory Flexibility Act of 1980, as amended (RFA),^[6] the NRC has prepared a regulatory flexibility analysis related to this proposed rule. The regulatory flexibility analysis is available as indicated in Section XIV, Availability of Documents, of this document.

VI. Regulatory Analysis

Under OBRA-90, the NRC is required to recover approximately 90 percent of its budget authority in FY 2019. The NRC established fee methodology guidelines for 10 CFR part 170 in 1978, and established additional fee methodology guidelines for 10 CFR part 171 in 1986. In subsequent rulemakings, the NRC has adjusted its fees without changing the underlying principles of its fee policy to ensure that the NRC continues to comply with the statutory requirements for cost recovery in OBRA-90.

In this rulemaking, the NRC continues this long-standing approach. Therefore, the NRC did not identify any alternatives to the current fee structure guidelines and did not prepare a regulatory analysis for this proposed rule.

VII. Backfitting and Issue Finality

The NRC has determined that the backfit rule, § 50.109, does not apply to this proposed rule and that a backfit analysis is not required. A backfit analysis is not required because these amendments do not require the modification of, or addition to, systems, structures, components, or the design of a facility, or the design approval or manufacturing license for a facility, or the procedures or organization required to design, construct, or operate a facility.

VIII. Plain Writing

The Plain Writing Act of 2010 (Pub. L. 111-274) requires Federal agencies to write documents in a clear, concise, and well-organized manner. The NRC has written this document to be consistent with the Plain Writing Act as well as the Presidential Memorandum, “Plain Language in Government Writing,” published June 10, 1998 (63 FR 31885). The NRC requests comment on the proposed rule with respect to the clarity and effectiveness of the language used.

IX. National Environmental Policy Act

The NRC has determined that this rule will amend the NRC's administrative requirements in 10 CFR parts 170 and 171. Therefore, this action is categorically excluded from needing environmental review as described in § 51.22(c)(1). Consequently, neither an environmental impact statement nor an environmental assessment has been prepared for this proposed rule.

X. Paperwork Reduction Act

This proposed rule does not contain a collection of information as defined in the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.) and, therefore, is not subject to the requirements of the Paperwork Reduction Act of 1995.

Public Protection Notification

The NRC may not conduct or sponsor, and a person is not required to respond to, a collection of information unless the document requesting or requiring the collection displays a currently valid OMB control number.

XI. Voluntary Consensus Standards

The National Technology Transfer and Advancement Act of 1995, Public Law 104-113, requires that Federal agencies use technical standards that are developed or adopted by voluntary consensus standards bodies unless the use of such a standard is inconsistent with applicable law or otherwise impractical. In this proposed rule, the NRC proposes to amend the licensing, inspection, and annual fees charged to its licensees and applicants, as necessary, to recover approximately 90 percent of its budget authority in FY 2019, as required by OBRA-90. This action does not constitute the establishment of a standard that contains generally applicable requirements.

XII. Availability of Guidance

The Small Business Regulatory Enforcement Fairness Act requires all Federal agencies to prepare a written compliance guide for each rule for which the agency is required by 5 U.S.C. 604 to prepare a regulatory flexibility analysis. The NRC, in compliance with the law, prepared the “Small Entity Compliance Guide” for the FY 2019 proposed fee rule. The compliance guide was developed when the NRC completed the small entity biennial review for FY 2019. This guide is available as indicated in Section XIV, Availability of Documents, of this document.

XIII. Public Meeting

The NRC will conduct a public meeting for the purpose of describing the proposed rule and answering questions from the public on the proposed rule. The NRC will publish a notice of the location, time, and agenda of the meeting on the NRC's public meeting website within at least 10 calendar days before the meeting. In addition, the agenda for the meeting will be posted on www.regulations.gov under Docket ID NRC-2017-0032. For instructions to receive alerts when changes or additions occur in a docket folder, see Section XIV, Availability of Documents, of this document. Stakeholders should monitor the NRC's public meeting website for information about the public meeting at: http://www.nrc.gov/​public-involve/​public-meetings/​index.cfm.

XIV. Availability of Documents

The documents identified in the following table are available to interested persons through one or more of the following methods, as indicated.

Throughout the development of this rule, the NRC may post documents related to this rule, including public comments, on the Federal Rulemaking website at http://www.regulations.gov under Docket ID NRC-2017-0032. The Federal Rulemaking website allows you to receive alerts when changes or additions occur in a docket folder. To subscribe: (1) Navigate to the docket folder NRC-2017-0032; (2) click the “Sign up for Email Alerts” link; and (3) enter your email address and select how frequently you would like to receive emails (daily, weekly, or monthly).

List of Subjects

10 CFR Part 170

• Byproduct material
• Import and export licenses
• Intergovernmental relations
• Non-payment penalties
• Nuclear energy
• Nuclear materials
• Nuclear power plants and reactors
• Source material
• Special nuclear material

10 CFR Part 171

• Annual charges
• Approvals
• Byproduct material
• Holders of certificates
• Intergovernmental relations
• Nonpayment penalties
• Nuclear materials
• Nuclear power plants and reactors
• Registrations
• Source material
• Special nuclear material

For the reasons set out in the preamble and under the authority of the Atomic Energy Act of 1954, as amended; the Energy Reorganization Act of 1974, as amended; and 5 U.S.C. 552 and 553, the NRC is proposing to adopt the following amendments to 10 CFR parts 170 and 171:

PART 170—FEES FOR FACILITIES, MATERIALS, IMPORT AND EXPORT LICENSES, AND OTHER REGULATORY SERVICES UNDER THE ATOMIC ENERGY ACT OF 1954, AS AMENDED

1. The authority citation for part 170 continues to read as follows:

Authority: Atomic Energy Act of 1954, secs. 11, 161(w) (42 U.S.C. 2014, 2201(w)); Energy Reorganization Act of 1974, sec. 201 (42 U.S.C. 5841); 42 U.S.C. 2214; 31 U.S.C. 901, 902, 9701; 44 U.S.C. 3504 note.

2. In § 170.21, in the table revise the entry for “K. Import and export licenses;” to read as follows:

3. In § 170.31, revise the table to read as follows:

PART 171—ANNUAL FEES FOR REACTOR LICENSES AND FUEL CYCLE LICENSES AND MATERIALS LICENSES, INCLUDING HOLDERS OF CERTIFICATES OF COMPLIANCE, REGISTRATIONS, AND QUALITY ASSURANCE PROGRAM APPROVALS AND GOVERNMENT AGENCIES LICENSED BY THE NRC

4. The authority citation for part 171 continues to read as follows:

Authority: Atomic Energy Act of 1954, secs. 11, 161(w), 223, 234 (42 U.S.C. 2014, 2201(w), 2273, 2282); Energy Reorganization Act of 1974, sec. 201 (42 U.S.C. 5841); 42 U.S.C. 2214; 44 U.S.C. 3504 note.

5. In § 171.15, revise paragraphs (b)(1) and (2) introductory text, (c)(1) and (2) introductory text, (d)(1) introductory text, (d)(2) and (3), and (f) to read as follows:

6. In § 171.16, revise paragraphs (c), (d), and (e) introductory text to read as follows:

Footnotes