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POLICY ISSUE
NOTATION VOTE

SECY-00-0166

August 2, 2000

• PURPOSE:
• SUMMARY:
• BACKGROUND:
• DISCUSSION:
• (1) Final Assessment of Oklahoma Agreement Materials Program
• (2) Transfer of Licenses
• (3) Actions Pending Against Licensees to be Transferred
• (4) Effective Date of the Agreement
• (5) Procedure for Reviewing Proposed Agreements
• IMPLEMENTATION
• COORDINATION:
• RECOMMENDATION:

PURPOSE:

To request Commission approval of the final Agreement with Oklahoma.

SUMMARY:

The Governor of Oklahoma has requested that the Commission enter into an Agreement under Section 274b of the Atomic Energy Act of 1954, as amended (Act). On March 31, 2000, the Commission, in a Staff Requirements Memorandum (SRM) SECY-00-0101, approved staff publication of a notice of the proposed Agreement in the Federal Register (FR). The notice was published as required by the Act and comments accepted. The comment period ended on July 7, 2000.

Based on staff's review of the proposed Oklahoma program, staff recommends that the Commission approve the Agreement (Attachment 1).

BACKGROUND:

In SECY-00-0101, staff presented a draft of its assessment of the proposed Oklahoma Agreement and discussed the statutory and policy background of the Agreement State program. As required by Section 274e of the Act, the proposed Agreement was published in the FR on June 7, 2000 (65 FR 36169), June 14, 2000 (65 FR 37437), June 21, 2000 (65 FR 38607), and June 28, 2000 (65 FR 39966). The full text of the NRC staff assessment was made available in the Public Document Room, and on the Internet at the Nuclear Regulatory Commission (NRC) external website.

Interested persons were invited to submit comments on (a) the proposed Agreement, especially its effect on public health and safety and (b) the NRC staff assessment. The public comment period ended on July 7, 2000, and the Commission did not receive any comments during that time.

The Agreement will allow Oklahoma to assume regulatory authority over 11e.(1) byproduct material, source material used to take advantage of its density and high mass properties where the use of the specifically licensed source material is subordinate to the primary specifically licensed use of either 11e.(1) byproduct material or special nuclear material, and special nuclear material (SNM) in quantities not sufficient to form a critical mass. Oklahoma will also assume authority to regulate the disposal of low-level radioactive waste at a land disposal site as described in 10 CFR Part 61.

DISCUSSION:

(1)  Final Assessment of Oklahoma Agreement Materials Program

The final assessment is identical to the draft staff assessment provided to the Commission in SECY-00-0101 dated May 5, 2000, with the exception of Criterion 20, Qualifications of Regulatory and Inspection Personnel. On July 12, 2000, the Oklahoma Radioactive Materials (RAM) program manager discussed with NRC staff the resignation of one of the three senior technical staff members, effective July 21, 2000. As a result, the number of vacancies reflected in the draft staff assessment for criterion 20 has changed from one to two vacancies. Oklahoma is actively recruiting to fill the vacant position created by the staff member who resigned. On July 13, 2000, the RAM program manager provided a revised workload staffing plan reallocating the distribution of work among the program's staff. The reallocation does not change the total allocation of 3.45 full time equivalent (FTE) technical/professional staff that would be devoted to the agreement materials program.

Under the revised plan, NRC staff review found that the Environmental Program Manager who is the RAM section manager has increased his time devoted to the Agreement materials program from 50% to 65%. Additionally, approximately 20% of this time has been reserved for direct licensing support, if necessary. The reallocation of staff effort devoted to the program includes an increase in staff time for three technical staff members as follows: 85 to100%; 70 to 100%; 25% (as trainee) to 30% (as interim qualified); and one decrease in staff time from 60 to 50%. The individual previously identified as "trainee" was granted interim qualification under the State's Training and Qualification Plan, based on that individual's further training and experience. Based on the continued Oklahoma Department of Environmental Quality (DEQ) staffing allocation of 3.45 technical/professional FTEs in the RAM Section, the ratio of approximately 1.57 technical/professional FTEs per 100 licenses does not change from the draft assessment. In addition, the DEQ staff has also stated that the State plans to accelerate staff training during September 2000 to January 2001 to fully qualify the interim qualified staff member and interim qualify an additional staff member who has six years well logging experience.

Based on the revised information, the NRC staff continues to conclude that the proposed Oklahoma agreement materials program staffing plan will provide an adequate number of qualified staff to meet the anticipated program needs and therefore, satisfies Criterion 20. The revised staffing plan information has been reflected in the staff's final assessment for Criterion 20.

(2)  Transfer of Licenses

Currently, there are approximately 235 NRC material licenses in Oklahoma. Staff has identified 220 that will be transferred to the State in whole or in part and NRC will retain jurisdiction over 14 nuclear material licenses under the agreement.

Based on information provided by Region IV licensees, staff estimates that approximately 23 licensees based in Oklahoma are expected to split their licenses to hold both NRC and Oklahoma licenses based on locations of use. This will facilitate their conducting licensed activities both within and outside the State of Oklahoma.

NRC staff is working closely with the staff of DEQ to effect a smooth transition. Staff is also coordinating with the Department staff on current or pending licensing, inspection, and enforcement activities involving the licenses to be transferred. Staff expects to close out any formerly licensed site activities prior to the effective date of the Agreement.

(3)  Actions Pending Against Licensees to be Transferred

The Office of Enforcement does not currently have any pending enforcement actions or confirmatory action letters against licensees that will transfer to Oklahoma under the Agreement. The Office of Investigations (OI) currently has two open investigations. These investigations are scheduled to be completed prior to the effective date of the Agreement. On the effective date of the Agreement, the staff will coordinate with the State and appropriately disposition any pending enforcement actions resulting from continuing inspection activities or open OI investigations.

(4)  Effective Date of the Agreement

The NRC and Department staffs have targeted September 29, 2000, as the effective date for the Agreement. To meet this date and provide adequate time for an orderly transfer of license files, and assumption of authority by Oklahoma on the effective date of the Agreement, the Commission should approve the Agreement by August 31, 2000.

The importance of having an agreement in place before the end of September relates primarily to fees. Currently, under 10 CFR 171, holders of an NRC license on October 1 of the fiscal year (FY) are subject to the annual fees for that FY. Therefore, unless the agreement is effective prior to October 1, 2000, the Oklahoma licensees would be subject to NRC's FY 2001 annual fees. The FY 2001 annual fees would be prorated 50 percent based on fee regulations if the Agreement goes into effect between October 1, 2000, and March 31, 2001.

Therefore, if the Agreement goes into effect after September 30, 2000, the possibility exists that Oklahoma licensees would be subject to both Oklahoma and NRC fees. Oklahoma staff has indicated that the State would be reluctant to impose "double billing" on Oklahoma materials licensees. In the event this situation occurs and Oklahoma could not issue fee bills, the State's inability to collect license fees to fund the Agreement materials program could jeopardize Oklahoma's ability to implement the Agreement program.

In the event the Agreement is delayed for a few days beyond September 30, 2000, the Chief Financial Officer has delegated authority to exempt the Oklahoma licensees from the NRC's FY 2001 annual fee requirements, if such an exemption is determined to be in the public interest. However, if the Agreement is significantly delayed, it would be more difficult to support a fee waiver.

(5)  Procedure for Reviewing Proposed Agreements

Staff processed the Oklahoma Agreement request under a new streamlined procedure for proposed Agreements that was designed to improve the efficiency and effectiveness of the reviews. Under the new procedure staff used a self-directed team approach and performed only one comprehensive review of the application. The single comprehensive review was preceded by a team review of the application for completeness to ensure the State had assembled the information needed for the comprehensive review. The team members were represented by the Offices of State and Tribal Programs, Nuclear Material Safety and Safeguards, General Counsel, Region IV, and Incident Response Operations. We expect to issue the final procedure within the next few weeks.

IMPLEMENTATION

Following the execution of an Agreement, staff continues a program of active interaction with the new Agreement State. This program consists of the exchange of regulatory information, notices of NRC training courses, and periodic on-site reviews of the State's program for the regulation of agreement materials. Communications are generally more frequent with a new Agreement State during the first years after the Agreement is signed. The regulatory information exchanged includes reports of incidents, significant enforcement actions, and amendments to policies, regulations, or guidance.

An orientation meeting of NRC and Department staff will be planned to occur about nine months after the Agreement becomes effective to discuss the initial program implementation. The first Integrated Materials Performance Evaluation Program (IMPEP) review of the Oklahoma program is planned for about 18 months after the effective date of the Agreement. Subsequent routine Agreement State program IMPEP reviews usually occur at 12 to 48 month intervals, with good performance resulting in the longer intervals between program reviews.

If approved by the Commission, Oklahoma will bring the number of Agreement States to 32.

COORDINATION:

The Office of the General Counsel has no legal objection to this paper. The Office of the Chief Financial Officer has reviewed this paper for resource implications and has no objections. Staff has obtained concurrence from the Office of Management and Budget (OMB) that this action does not constitute a "major rule" under the Small Business Regulatory Enforcement and Fairness Act of 1996 (SBREFA).

RECOMMENDATION:

That the Commission:

Attachments:

1. Proposed Agreement 2. NRC Staff Assessment of the Oklahoma Program 3. Draft Letter to Oklahoma Governor Keating 4. Draft Federal Register Notice of Agreement Signing

ATTACHMENT 1

ATTACHMENT TO FEDERAL REGISTER NOTICE

• ARTICLE I
• ARTICLE II
• ARTICLE III
• ARTICLE IV
• ARTICLE V
• ARTICLE VI
• ARTICLE VII
• ARTICLE VIII
• ARTICLE IX

An Agreement Between the United States Nuclear Regulatory Commission and the State of Oklahoma for the Discontinuance of Certain Commission Regulatory Authority and Responsibility Within the State Pursuant to Section 274 of the Atomic Energy Act of 1954, as Amended

WHEREAS, The United States Nuclear Regulatory Commission (hereinafter referred to as the Commission) is authorized under Section 274 of the Atomic Energy Act of 1954, as amended (hereinafter referred to as the Act), to enter into agreements with the Governor of any State providing for discontinuance of the regulatory authority of the Commission within the State under Chapters 6, 7, and 8, and Section 161 of the Act with respect to byproduct materials as defined in Sections 11e.(1) and (2) of the Act, source materials, and special nuclear materials in quantities not sufficient to form a critical mass; and,

WHEREAS, The Governor of the State of Oklahoma is authorized under Section 2-9-103(c) of the Radiation Management Act (27A O.S. Supp. 1998 § 2-9-101 et seq.) to enter into this Agreement with the Commission; and,

WHEREAS, The Governor of the State of Oklahoma certified on December 28, 1999 that the State of Oklahoma (hereinafter referred to as the State) has a program for the control of radiation hazards adequate to protect the health and safety with respect to materials within the State covered by this Agreement, and that the State desires to assume regulatory responsibility for such materials; and,

WHEREAS, The Commission found on (date to be determined) that the program of the State for the regulation of the materials covered by this Agreement is compatible with the Commission's program for the regulation of such materials and is adequate to protect public health and safety; and,

WHEREAS, The State and the Commission recognize the desirability and importance of cooperation between the Commission and the State in the formulation of standards for protection against hazards of radiation and in assuring that State and Commission programs for protection against hazards of radiation will be coordinated and compatible; and,

WHEREAS, The Commission and the State recognize the desirability of reciprocal recognition of licenses, and of the granting of limited exemptions from licensing of those materials subject to this Agreement; and,

WHEREAS, This Agreement is entered into pursuant to the provisions of the Act of 1954, as amended;

NOW THEREFORE, It is hereby agreed between the Commission and the Governor of the State of Oklahoma, acting in behalf of the State, as follows:

ARTICLE I

Subject to the exceptions provided in Articles II, IV, and V, the Commission shall discontinue, as of the effective date of this Agreement, the regulatory authority of the Commission in the State under Chapters 6, 7, and 8, and Section 161 of the Act with respect to the following materials:

ARTICLE II

This Agreement does not provide for discontinuance of any authority and the Commission shall retain authority and responsibility with respect to:

ARTICLE III

With the exception of those activities identified in Article II, paragraph A through D, this Agreement may be amended, upon application by the State and approval by the Commission, to include one or more of the additional activities specified in Article II, paragraphs E through G, whereby the State may then exert regulatory authority and responsibility with respect to those activities.

ARTICLE IV

Notwithstanding this Agreement, the Commission may from time to time by rule, regulation, or order, require that the manufacturer, processor, or producer of any equipment, device, commodity, or other product containing source, byproduct, or special nuclear material shall not transfer possession or control of such product except pursuant to a license or an exemption from licensing issued by the Commission.

ARTICLE V

This Agreement shall not affect the authority of the Commission under Subsection 161b or 161i of the Act to issue rules, regulations, or orders to protect the common defense and security, to protect restricted data, or to guard against the loss or diversion of special nuclear material.

ARTICLE VI

The Commission will cooperate with the State and other Agreement States in the formulation of standards and regulatory programs of the State and the Commission for protection against hazards of radiation and to assure that Commission and State programs for protection against hazards of radiation will be coordinated and compatible. The State agrees to cooperate with the Commission and other Agreement States in the formulation of standards and regulatory programs of the State and the Commission for protection against hazards of radiation and to assure that the State's program will continue to be compatible with the program of the Commission for the regulation of byproduct material covered by this Agreement.

The State and the Commission agree to keep each other informed of proposed changes in their respective rules and regulations, and to provide each other the opportunity for early and substantive contribution to the proposed changes.

The State and the Commission agree to keep each other informed of events, accidents, and licensee performance that may have generic implication or otherwise be of regulatory interest.

ARTICLE VII

The Commission and the State agree that it is desirable to provide reciprocal recognition of licenses for the materials listed in Article I licensed by the other party or by any other Agreement State. Accordingly, the Commission and the State agree to develop appropriate rules, regulations, and procedures by which such reciprocity will be accorded.

ARTICLE VIII

The Commission, upon its own initiative after reasonable notice and opportunity for hearing to the State, or upon request of the Governor of the State, may terminate or suspend all or part of this Agreement and reassert the licensing and regulatory authority vested in it under the Act if the Commission finds that (1) such termination or suspension is required to protect public health and safety, or (2) the State has not complied with one or more of the requirements of Section 274 of the Act. The Commission may also, pursuant to Section 274j(2) of the Act, temporarily suspend all or part of this Agreement if, in the judgement of the Commission, an emergency situation exists requiring immediate action to protect public health and safety and the State has failed to take necessary steps. The Commission shall periodically review actions taken by the State under this Agreement to ensure compliance with Section 274 of the Act which requires a State program to be adequate to protect public health and safety with respect to the materials covered by this Agreement and to be compatible with the Commission's program.

ARTICLE IX

This Agreement shall become effective on September 29, 2000, and shall remain in effect unless and until such time as it is terminated pursuant to Article VIII.

Dated at Rockville, Maryland, this ____th day of _____________,2000.

ATTACHMENT 3

The Honorable Frank Keating
Governor of Oklahoma
Oklahoma City, OK 73105

Dear Governor Keating:

I am pleased to inform you that the U. S. Nuclear Regulatory Commission (NRC) has approved your proposed Agreement under which the NRC will discontinue and the State of Oklahoma will assume regulatory authority over the acquisition, possession, use, transfer, and disposal of byproduct material, limited quantities of source material (primarily used as shielding), special nuclear material in quantities not sufficient to form a critical mass, and disposal of low-level radioactive waste at a land disposal site.

Enclosed are three formal copies of the Agreement for your signature. After signature, one copy should be retained by your office, and the other two copies should be mailed to Paul H. Lohaus, Director, Office of State and Tribal Programs, U.S. Nuclear Regulatory Commission, Washington, DC 20555.

Thanking you in advance, we are pleased with your continued interest in participating in the Agreement State Program and look forward to the continued excellent relationship we have enjoyed with the State of Oklahoma in the past.

Enclosure:  As stated

ATTACHMENT 4

U. S. NUCLEAR REGULATORY COMMISSION

State of Oklahoma: Discontinuance of Certain Commission Regulatory
Authority Within the State; Notice of Agreement Between the
NRC and the State of Oklahoma

AGENCY:  U. S. Nuclear Regulatory Commission.

ACTION:  Notice of Agreement between the NRC and the State of Oklahoma.

SUMMARY:  This notice is announcing that on August __, 2000, Dr. Richard Meserve, Chairman of the U.S. Nuclear Regulatory Commission (NRC) and on August __, 2000, Governor Frank Keating of the State of Oklahoma signed an Agreement as authorized by Section 274b of the Atomic Energy Act of 1954, as amended (Act). The Agreement provides for the Commission to discontinue its regulatory authority over the possession and use of byproduct material as defined in Section 11e.(1) of the Act, special nuclear materials (in quantities not sufficient to form a critical mass), source material used to take advantage of its density and high mass properties where the use of the specifically licensed material is subordinate to the primary specifically licensed use of either 11e.(1) byproduct material or special nuclear material (primarily used as shielding), and the disposal of low-level radioactive waste at a land disposal site in the State of Oklahoma, and for Oklahoma to assume the regulatory authority. Under the Agreement, a person in Oklahoma possessing these materials is exempt from certain Commission regulations. The exemptions have been previously published in the Federal Register (FR) and are codified in the Commission's regulations as 10 CFR Part 150. The Agreement is published here as required by Section 274e of the Act.

ADDRESSES:  Copies of the staff assessment, and the Commission's decision may be viewed at the NRC website, http://www.nrc.gov.

FOR FURTHER INFORMATION CONTACT: Patricia M. Larkins, Office of State and Tribal Programs, U.S. Nuclear Regulatory Commission, Washington, DC 20555-0001. Telephone (301) 415-2309 or e-mail PML@NRC.GOV.

SUPPLEMENTARY INFORMATION:

The draft Agreement was published in the Federal Register for comment once a week for four consecutive weeks (see, e.g., 65 FR 36169, June 7, 2000) as required by the Act. The public comment period ended on July 7, 2000, and the Commission did not receive any comments during that time. After considering the request for an Agreement by the Governor of Oklahoma, the supporting documentation submitted with the request for an Agreement, and its interactions with the staff of the Oklahoma Department of Health, Bureau of Radiological Health, the NRC staff completed an assessment of the Oklahoma program. Based on the staff's assessment, the Commission determined on ____ __, 2000, that the proposed Oklahoma program for the control of radiation hazards is adequate to protect public health and safety, and that it is compatible with the Commission's program.

Small Business Regulatory Enforcement Fairness Act

In accordance with the Small Business Regulatory Enforcement Fairness Act of 1996, the NRC has determined that this action is not a major rule and has verified this determination with the Office of Information and Regulatory Affairs of the Office of Management and Budget (OMB).

Dated at Rockville, Maryland, this ____ day of ______, 2000.