99–006

107TH CONGRESS REPORT " ! HOUSE OF REPRESENTATIVES 1st Session 107–341

THORIUM REIMBURSEMENT

DECEMBER 18, 2001.—Committed to the Committee of the Whole House on the State

of the Union and ordered to be printed

Mr. TAUZIN, from the Committee on Energy and Commerce,

submitted the following

R E P O R T

[To accompany H.R. 3343]

[Including cost estimate of the Congressional Budget Office]

The Committee on Energy and Commerce, to whom was referred

the bill (H.R. 3343) to amend title X of the Energy Policy Act of

1992, and for other purposes, having considered the same, report

favorably thereon with an amendment and recommend that the bill

as amended do pass.

CONTENTS

Page

Amendment .............................................................................................................. 1

Purpose and Summary ............................................................................................ 2

Background and Need for Legislation .................................................................... 3

Hearings ................................................................................................................... 4

Committee Consideration ........................................................................................ 4

Committee Votes ...................................................................................................... 4

Committee Oversight Findings ............................................................................... 4

Statement of General Performance Goals and Objectives .................................... 4

New Budget Authority, Entitlement Authority, and Tax Expenditures ............. 4

Committee Cost Estimate ....................................................................................... 4

Congressional Budget Office Estimate ................................................................... 4

Federal Mandates Statement ................................................................................. 6

Advisory Committee Statement .............................................................................. 6

Constitutional Authority Statement ...................................................................... 6

Applicability to Legislative Branch ........................................................................ 6

Section-by-Section Analysis of the Legislation ...................................................... 6

Changes in Existing Law Made by the Bill, as Reported ..................................... 7

AMENDMENT

The amendment is as follows:

Strike all after the enacting clause and insert the following:

2

SECTION 1. REAUTHORIZATION OF THORIUM REIMBURSEMENT.

(a) PAYMENTS TO LICENSEES.—Section 1001(b)(2)(C) of the Energy Policy Act of

1992 (42 U.S.C. 2296a(b)(2)(C)) is amended—

(1) by striking ‘‘$140,000,000’’ and inserting ‘‘$365,000,000’’; and

(2) by adding at the end the following: ‘‘Such payments shall not exceed the

following amounts:

‘‘(i) $90,000,000 in fiscal year 2002.

‘‘(ii) $55,000,000 in fiscal year 2003.

‘‘(iii) $20,000,000 in fiscal year 2004.

‘‘(iv) $20,000,000 in fiscal year 2005.

‘‘(v) $20,000,000 in fiscal year 2006.

‘‘(vi) $20,000,000 in fiscal year 2007.

Any amounts authorized to be paid in a fiscal year under this subparagraph

that are not paid in that fiscal year may be paid in subsequent fiscal

years.’’.

(b) AUTHORIZATION.—Section 1003(a) of such Act (42 U.S.C. 2296a–2(a)) is amended by striking ‘‘$490,000,000’’ and inserting ‘‘$715,000,000’’.

(c) DEPOSITS.—Section 1802(a) of the Atomic Energy Act of 1954 (42 U.S.C.

2297g–1(a)) is amended by striking ‘‘$488,333,333’’ and inserting ‘‘$518,233,333’’ and

by inserting after ‘‘inflation’’ the phrase ‘‘beginning on the date of the enactment of

the Energy Policy Act of 1992’’.

(d) PORTSMOUTH.—(1) Chapter 19 of the Atomic Energy Act of 1954 (42 U.S.C.

2015 and following) is amended by inserting the following after section 241:

‘‘SEC. 242. COLD STANDBY.

‘‘The Secretary is authorized to expend such funds as may be necessary for the

purposes of maintaining enrichment capability at the Portsmouth, Ohio, facility.’’.

(2) The table of contents for such chapter is amended by inserting the following

new item after the item relating to section 241:

‘‘Sec. 242. Cold standby.’’.

SEC. 2. COMPTROLLER GENERAL AUDIT.

The Comptroller General shall conduct an audit on the Uranium Enrichment Decontamination and Decommissioning Fund established under section 1801 of the

Atomic Energy Act of 1954 (42 U.S.C. 2297g). Not later than March 1, 2003, the

Comptroller General shall transmit to the Congress a report on the results of the

audit. Such report shall assess whether the Fund as currently authorized will be

of sufficient size and duration for carrying out decontamination and decommissioning and remedial action activities anticipated to be paid for from the fund, and

shall include recommendations for minimizing increases in such activities. In conducting the audit, the Comptroller General shall specifically address whether the

deposits collected under sections 1802(c) and 1802(d) of the Atomic Energy Act of

1954 (42 U.S.C. 2297g–1(c) and 2297g–1(d)) are sufficient to—

(1) pay for decontamination and decommissioning activities pursuant to section 1803(b) of the Atomic Energy Act of 1954 (42 U.S.C. 2297g–2(b));

(2) pay for the remedial action costs pursuant to section 1803(c) of such Act

(42 U.S.C. 2297g–2(c)); and

(3) pay for the remedial action costs pursuant to section 1001(b)(2)(C) and (D)

of the Energy Policy Act of 1992 (42 U.S.C. 2296a(b)(2)(C) and (D)).

PURPOSE AND SUMMARY

The purpose of H.R. 3343 is to increase by $225 million the authorization level for the thorium reimbursement program established pursuant to Title X of the Energy Policy Act of 1992. The

bill also increases deposits to the Uranium Enrichment Decontamination and Decommissioning Fund by the same amount, after

adjustments for inflation. In addition, the bill authorizes appropriations for the Secretary of Energy to maintain the uranium enrichment facility at Portsmouth, Ohio on cold standby. Finally, the bill

requires the Comptroller General to conduct an audit of the Uranium Enrichment Decontamination and Decommissioning Fund

and the programs paid for by the fund, with regard to future costs

and needs.

3

BACKGROUND AND NEED FOR LEGISLATION

Title X, Subtitle A of the Energy Policy Act of 1992 (EPAct) authorizes the Department of Energy (DOE) to use the Uranium Enrichment Decontamination and Decommissioning Fund (D&D

Fund) established in Chapter 28 of the Atomic Energy Act of 1954

to reimburse thorium processing site licensees for a portion of the

cost of environmental cleanup. There is only one thorium-contaminated site which is owned by Kerr-McGee Chemical Corporation

(Kerr-McGee), and it is located in West Chicago, Illinois.

Section 1001 of EPAct establishes the responsibility of licensees

for bearing the costs of decontamination, decommissioning, reclamation and other remedial action at active uranium and thorium

sites where byproduct material has been produced. However, the

section also requires the Secretary of Energy to reimburse annually

a licensee for that portion of the remedial cost the Secretary has

determined is attributable to byproduct material generated as the

result of sales to the federal government. In the case of the West

Chicago site, DOE has determined that 55.2% of the remedial cost

is attributable to government contracts. As such, Kerr-McGee manages the cleanup, incurs cleanup costs at West Chicago at its own

expense, and submits claims for reimbursement of 55.2% of its incurred costs. DOE reimburses claims submitted by Kerr-McGee

after the Department reviews the company’s claims.

As enacted, EPAct authorized the Secretary to make reimbursement payments to thorium licensees of not more than $40 million.

Public Law 104–259 increased the authorization to $65 million,

while Public Law 105–388 increased it to $140 million. Congress

increased the cap on federal contributions as cleanup activities

have proceeded at the site and resulted in corresponding additional

submissions of receipts for reimbursement.

At the end of 2000, Kerr-McGee had incurred cleanup costs totaling $375 million, of which $207 million is potentially eligible for

Federal reimbursement. DOE has reimbursed only $146 million of

this amount, and has no authority to provide additional reimbursements due to the current authorization cap of $140 million (the additional $6 million is related to authorized inflation adjustments).

Thus, there is currently a $61 million shortfall in reimbursement

for cleanup costs incurred through 2000.

Kerr-McGee currently projects that it will incur an additional

$298 million in additional cleanup costs to complete the project. Of

this amount, the potential amount eligible for reimbursement by

the Secretary is projected to be an additional $164 million, bringing

the total Federal contribution to $371 million ($146 million paid to

date, plus $61 million in un-reimbursed claims, plus $164 million

in projected future claims).

H.R. 3343 would increase the authorization in Section

1001(b)(2)(C) of EPAct to cover the full potential remaining Federal

contribution to the thorium cleanup. The bill would also increase

the annual cap on deposits to the D&D Fund by the same amount,

after adjustments for inflation, to cover the costs of the thorium

program, in order to assure that sufficient funds are available for

cleaning up the Portsmouth and Paducah Gaseous Diffusion

Plants, which are also paid for out of the D&D Fund.

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HEARINGS

The Committee on Energy and Commerce has not held hearings

on the legislation.

COMMITTEE CONSIDERATION

On Wednesday, December 12, 2001, the Full Committee met in

open markup session and ordered H.R. 3343 favorably reported to

the House, as amended, by a voice vote, a quorum being present.

COMMITTEE VOTES

Clause 3(b) of rule XIII of the Rules of the House of Representatives requires the Committee to list the record votes on the motion

to report legislation and amendments thereto. There were no

record votes taken in connection with ordering H.R. 3343 reported.

A motion by Mr. Tauzin to order H.R. 3343 reported to the House,

as amended, was agreed to by a voice vote.

COMMITTEE OVERSIGHT FINDINGS

Pursuant to clause 3(c)(1) of rule XIII of the Rules of the House

of Representatives, the Committee has not held oversight or legislative hearings on this legislation.

STATEMENT OF GENERAL PERFORMANCE GOALS AND OBJECTIVES

The goal of H.R. 3343 is to increase the authorization to cover

the Federal cost-share for the cleanup of the thorium contaminated

site in West Chicago owned by the Kerr-McGee Corporation.

NEW BUDGET AUTHORITY, ENTITLEMENT AUTHORITY, AND TAX

EXPENDITURES

In compliance with clause 3(c)(2) of rule XIII of the Rules of the

House of Representatives, the Committee finds that H.R. 3343, a

bill to amend title X of the Energy Policy Act of 1992, and for other

purposes, would result in no new or increased budget authority, entitlement authority, or tax expenditures or revenues.

COMMITTEE COST ESTIMATE

The Committee adopts as its own the cost estimate prepared by

the Director of the Congressional Budget Office pursuant to section

402 of the Congressional Budget Act of 1974.

CONGRESSIONAL BUDGET OFFICE ESTIAMTE

Pursuant to clause 3(c)(3) of rule XIII of the Rules of the House

of Representatives, the following is the cost estimate provided by

the Congressional Budget Office pursuant to section 402 of the

Congressional Budget Act of 1974:

5

U.S. CONGRESS,

CONGRESSIONAL BUDGET OFFICE,

Washington, DC, December 18, 2001.

Hon. W.J. ‘‘BILLY’’ TAUZIN,

Chairman, Committee on Energy and Commerce,

House of Representatives, Washington, DC.

DEAR MR. CHAIRMAN: The Congressional Budget Office has prepared the enclosed cost estimate for H.R. 3343, a bill to amend title

X of the Energy Policy Act and for other purposes.

If you wish further details on this estimate, we will be pleased

to provide them. The CBO staff contact is Lisa Cash Driskill.

Sincerely,

BARRY B. ANDERSON,

(For Dan L. Crippen, Director).

Enclosure.

H.R. 3343—A bill to amend title X of the Energy Policy Act and for

other purposes

Summary: H.R. 3343 would authorize the appropriation of $225

million over the 2002–2007 period for payments to private contractors for remediation work at a thorium processing plant that supplied nuclear material to the federal government. Assuming appropriation of the authorized amounts, CBO estimates that implementing the bill would cost $195 million over the 2002–2006 period, with the remaining $30 million spent after 2006.

The bill also would authorize the appropriation of such sums as

may be necessary for maintaining the uranium enrichment capability of the Portsmouth Gaseous Diffusion Plant in 2002. The Department of Energy (DOE) currently has the authority for such activities under the Atomic Energy Act and plans to spend about $65

million in 2002 to maintain the enrichment capability at the Portsmouth facility. Therefore, this provision of the bill would not add

to costs that could be incurred under current law. The bill also

would require the Comptroller General to provide an audit of the

Uranium Decontamination and Decommission Fund and report to

the Congress. CBO estimates that this work would have a negligible effect of federal spending.

H.R. 3343 would not affect direct spending or receipts; therefore,

pay-as-you-go procedures would not apply. The bill contains no

intergovernmental or private-sector mandates as defined in the Unfunded Mandates Reform Act (UMRA) and would impose no costs

on state, local, or tribal governments.

Estimated cost to the Federal Government: The estimated budgetary impact of H.R. 3343 is shown in the following table. The costs

of this legislation fall within budget function 270 (energy).

By fiscal year, in millions of dollars—

2002 2003 2004 2005 2006

CHANGES IN SPENDING SUBJECT TO APPROPRIATION

Estimated authorization level ....................................................................... 90 55 20 20 20

Estimated outlays ......................................................................................... 45 73 38 20 20

Basis of estimate: For this estimate, CBO assumes that H.R.

3343 will be enacted in January 2002 and that all amounts authorVerDate 11-MAY-2000 12:34 Dec 19, 2001 Jkt 099006 PO 00000 Frm 00005 Fmt 6659 Sfmt 6602 E:\HR\OC\HR341.XXX pfrm01 PsN: HR341
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ized will be appropriated in each year, as specified by the bill. Outlays were estimated using historical spending patterns for the decontamination program.

The bill would increase the amount authorized to pay a private

contractor for decontamination of a thorium processing plant in

West Chicago, Illinois, that formerly provided nuclear material to

the federal government. Based on information from DOE, the additional funds that would be authorized by this bill would be spent

over the next several years. Thus, CBO estimates that, implementing the bill would cost $195 million over the 2002–2006 period and $225 million over the 2002–2011 period.

Pay-as-you-go considerations: None.

Intergovernmental and private sector impact: H.R. 3343 contains

no intergovernmental or private-sector mandates as defined by

UMRA and would impose no costs on state, local, or tribal governments.

Estimate prepared by: Federal costs: Lisa Cash Driskill; impact

on State, local, and tribal governments: Elyse Goldman; impact on

the private sector: Lauren Marks.

Estimate approved by: Peter H. Fontaine, Deputy Assistant Director for Budget Analysis.

FEDERAL MANDATES STATEMENT

The Committee adopts as its own the estimate of Federal mandates prepared by the Director of the Congressional Budget Office

pursuant to section 423 of the Unfunded Mandates Reform Act.

ADVISORY COMMITTEE STATEMENT

No advisory committees within the meaning of section 5(b) of the

Federal Advisory Committee Act were created by this legislation.

CONSTITUTIONAL AUTHORITY STATEMENT

Pursuant to clause 3(d)(1) of rule XIII of the Rules of the House

of Representatives, the Committee finds that the Constitutional authority for this legislation is provided in Article I, section 8, clause

3, which grants Congress the power to regulate commerce with foreign nations, among the several States, and with the Indian tribes.

APPLICABILITY TO LEGISLATIVE BRANCH

The Committee finds that the legislation does not relate to the

terms and conditions of employment or access to public services or

accommodations within the meaning of section 102(b)(3) of the Congressional Accountability Act.

SECTION-BY-SECTION ANALYSIS OF THE LEGISLATION

Section 1. Reauthorization of thorium reimbursement

Section 1(a) amends Title X of the Energy Policy Act of 1992 to

increase the authorization for payments to thorium licensees by

$225 million, from its current level of $140 million to $365 million.

The general authorization level in Title X is also increased by $225

million in section 1(b) to match the increase in section 1(a). The

new additional authority is subject to annual limits effectively requiring the new authority to be amortized over a six-year period

7

beginning in fiscal year 2002. The Committee has included these

specific annual limits in an effort to help avoid the potential for

competition with other cleanup activities paid for from the D&D

Fund. Payments to the thorium licensee shall not exceed the authorized amount in any year; however, any amounts authorized to

be paid in a fiscal year that are not paid in that year may carry

over and be paid in subsequent fiscal years.

Section 1(c) amends Section 1802(a) of the Atomic Energy Act to increase the required D&D Fund deposits by $29.9 million per year

which is equal to the $225 million increase in the thorium reimbursement after adjusting the amount to reflect 1992 constant dollars. Thus, the Committee expects there to be no adverse impact

on the availability of money for other projects authorized to be paid

for out of the D&D Fund. The Committee has not increased the

special assessment on domestic utilities in Section 1802(c) of the

Atomic Energy Act, thereby requiring the additional cost of deposits to be paid for by the appropriations from general revenues authorized by Section 1802(d). This section also clarifies that the

D&D Fund annual deposit amount of $518,233,333—which is in

1992 constant dollars—should continue to be adjusted annually for

inflation using the date of the enactment of the Energy Policy Act

of 1992 as the baseline for inflation adjustments.

Section 1(d) amends the Atomic Energy Act to authorize appropriations to the Secretary of Energy to expend such funds as may

be necessary for the purpose of keeping the Portsmouth Gaseous

Diffusion Plant in Portsmouth, Ohio, on cold standby. DOE is not

provided with any authority to use monies from the D&D fund for

this purpose. Indeed, the Committee language specifically amends

Chapter 19 of the Atomic Energy Act rather than Chapter 28 in

order to avoid the appearance that it is in any way affecting the

previously authorized uses of the D&D Fund.

Section 2. Comptroller General audit

This section requires the Comptroller General to audit the D&D

Fund and report its findings to Congress no later than March 1,

2003. In reporting to Congress, the Comptroller General is to assess whether the Fund will be of sufficient size and duration to

cover the costs of all the activities authorized to be paid for from

the fund. The Comptroller General should pay particular attention

to any factors contributing to increased costs, in order to aid in accurately projecting the future demands on the fund. The Committee expects that this examination will also assist the Comptroller General in fulfilling the bill’s requirement that he make recommendations for curtailing future increases in cleanup costs. The

legislation also directs the Comptroller General to address whether

the collections and deposits made pursuant to sections 1802(c) and

1802(d) of the Atomic Energy Act are providing revenue of sufficient size and duration to cover all the costs of the activities that

the Atomic Energy Act and EPAct require the D&D Fund to support.

CHANGES IN EXISTING LAW MADE BY THE BILL, AS REPORTED

In compliance with clause 3(e) of rule XIII of the Rules of the

House of Representatives, changes in existing law made by the bill,

as reported, are shown as follows (existing law proposed to be omitVerDate 11-MAY-2000 12:34 Dec 19, 2001 Jkt 099006 PO 00000 Frm 00007 Fmt 6659 Sfmt 6602 E:\HR\OC\HR341.XXX pfrm01 PsN: HR341
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ted is enclosed in black brackets, new matter is printed in italic,

existing law in which no change is proposed is shown in roman):

ENERGY POLICY ACT OF 1992

* * * * * * *

TITLE X—REMEDIAL ACTION AND

URANIUM REVITALIZATION

Subtitle A—Remedial Action at Active

Processing Sites

SEC. 1001. REMEDIAL ACTION PROGRAM.

(a) * * *

(b) REIMBURSEMENT.— (1) * * *

(2) AMOUNT.— (A) * * *

* * * * * * *

(C) TO THORIUM LICENSEES.—Payments made under

paragraph (1) to the licensee of the active thorium site

shall not exceed ø$140,000,000¿ $365,000,000, and may

only be made for off-site disposal. Such payments shall not

exceed the following amounts:

(i) $90,000,000 in fiscal year 2002.

(ii) $55,000,000 in fiscal year 2003.

(iii) $20,000,000 in fiscal year 2004.

(iv) $20,000,000 in fiscal year 2005.

(v) $20,000,000 in fiscal year 2006.

(vi) $20,000,000 in fiscal year 2007.

Any amounts authorized to be paid in a fiscal year under

this subparagraph that are not paid in that fiscal year may

be paid in subsequent fiscal years.

* * * * * * *

SEC. 1003. AUTHORIZATION OF APPROPRIATIONS.

(a) IN GENERAL.—There is authorized to be appropriated

ø$490,000,000¿ $715,000,000 to carry out this subtitle. The aggregate amount authorized in the preceding sentence shall be increased annually as provided in section 1001, based upon an inflation index to be determined by the Secretary.

* * * * * * *

ATOMIC ENERGY ACT OF 1954

ATOMIC ENERGY ACT OF 1954

TABLE OF CONTENTS

TITLE I—ATOMIC ENERGY

* * * * * * *

9

CHAPTER 19. MISCELLANEOUS

Sec. 241. Transfer of Property.

Sec. 242. Cold standby.

* * * * * * *

TITLE I—ATOMIC ENERGY

* * * * * * *

CHAPTER 19. MISCELLANEOUS

* * * * * * *

SEC. 242. COLD STANDBY.

The Secretary is authorized to expend such funds as may be necessary for the purposes of maintaining enrichment capability at the

Portsmouth, Ohio, facility.

* * * * * * *

TITLE II—UNITED STATES

ENRICHMENT CORPORATION

* * * * * * *

CHAPTER 28—DECONTAMINATION AND

DECOMMISSIONING

* * * * * * *

SEC. 1802. DEPOSITS.

(a) AMOUNT.—The Fund shall consist of deposits in the amount

of ø$488,333,333¿ $518,233,333 per fiscal year (to be annually adjusted for inflation beginning on the date of the enactment of the

Energy Policy Act of 1992 using the Consumer Price Index for allurban consumers published by the Department of Labor) as provided in this section.

* * * * * * *

Æ