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99–813 2016

THE NUCLEAR WASTE FUND: BUDGETARY, 

FUNDING, AND SCORING ISSUES 

HEARING 

BEFORE THE

SUBCOMMITTEE ON ENVIRONMENT AND THE 

ECONOMY 

OF THE

COMMITTEE ON ENERGY AND 

COMMERCE 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED FOURTEENTH CONGRESS 

FIRST SESSION 

DECEMBER 3, 2015 

Serial No. 114–106 

( 

Printed for the use of the Committee on Energy and Commerce 

energycommerce.house.gov 

(II) 

COMMITTEE ON ENERGY AND COMMERCE 

FRED UPTON, Michigan 

Chairman 

JOE BARTON, Texas 

Chairman Emeritus 

ED WHITFIELD, Kentucky 

JOHN SHIMKUS, Illinois 

JOSEPH R. PITTS, Pennsylvania 

GREG WALDEN, Oregon 

TIM MURPHY, Pennsylvania 

MICHAEL C. BURGESS, Texas 

MARSHA BLACKBURN, Tennessee 

Vice Chairman 

STEVE SCALISE, Louisiana 

ROBERT E. LATTA, Ohio 

CATHY MCMORRIS RODGERS, Washington 

GREGG HARPER, Mississippi 

LEONARD LANCE, New Jersey 

BRETT GUTHRIE, Kentucky 

PETE OLSON, Texas 

DAVID B. MCKINLEY, West Virginia 

MIKE POMPEO, Kansas 

ADAM KINZINGER, Illinois 

H. MORGAN GRIFFITH, Virginia 

GUS M. BILIRAKIS, Florida 

BILL JOHNSON, Ohio 

BILLY LONG, Missouri 

RENEE L. ELLMERS, North Carolina 

LARRY BUCSHON, Indiana 

BILL FLORES, Texas 

SUSAN W. BROOKS, Indiana 

MARKWAYNE MULLIN, Oklahoma 

RICHARD HUDSON, North Carolina 

CHRIS COLLINS, New York 

KEVIN CRAMER, North Dakota 

FRANK PALLONE, JR., New Jersey 

Ranking Member 

BOBBY L. RUSH, Illinois 

ANNA G. ESHOO, California 

ELIOT L. ENGEL, New York 

GENE GREEN, Texas 

DIANA DEGETTE, Colorado 

LOIS CAPPS, California 

MICHAEL F. DOYLE, Pennsylvania 

JANICE D. SCHAKOWSKY, Illinois 

G.K. BUTTERFIELD, North Carolina 

DORIS O. MATSUI, California 

KATHY CASTOR, Florida 

JOHN P. SARBANES, Maryland 

JERRY MCNERNEY, California 

PETER WELCH, Vermont 

BEN RAY LUJA ́ N, New Mexico 

PAUL TONKO, New York 

JOHN A. YARMUTH, Kentucky 

YVETTE D. CLARKE, New York 

DAVID LOEBSACK, Iowa 

KURT SCHRADER, Oregon 

JOSEPH P. KENNEDY, III, Massachusetts 

TONY CA ́ RDENAS, California 

SUBCOMMITTEE ON ENVIRONMENT AND THE ECONOMY

JOHN SHIMKUS, Illinois 

Chairman 

GREGG HARPER, Vice Chairman 

Vice Chairman 

ED WHITFIELD, Kentucky 

JOSEPH R. PITTS, Pennsylvania 

TIM MURPHY, Pennsylvania 

ROBERT E. LATTA, Ohio 

DAVID B. MCKINLEY, West Virginia 

BILL JOHNSON, Ohio 

LARRY BUCSHON, Indiana 

BILL FLORES, Texas 

RICHARD HUDSON, North Carolina 

KEVIN CRAMER, North Dakota 

FRED UPTON, Michigan (ex officio) 

PAUL TONKO, New York 

Ranking Member 

KURT SCHRADER, Oregon 

GENE GREEN, Texas 

DIANA DEGETTE, Colorado 

LOIS CAPPS, California 

MICHAEL F. DOYLE, Pennsylvania 

JERRY MCNERNEY, California 

TONY CA ́ RDENAS, California 

FRANK PALLONE, JR., New Jersey (ex 

officio) 

(III) 

C O N T E N T S 

Page 

Hon. John Shimkus, a Representative in Congress from the State of Illinois, 

opening statement ................................................................................................ 1 

Prepared statement .......................................................................................... 3 

Hon. Fred Upton, a Representative in Congress from the State of Michigan, 

prepared statement .............................................................................................. 44 

Hon. Frank Pallone, Jr., a Representative in Congress from the State of 

New Jersey, prepared statement ........................................................................ 45 

WITNESSES

David Bearden, Specialist in Environmental Policy, Congressional Research 

Service ................................................................................................................... 5 

Prepared statement .......................................................................................... 8 

Answers to submitted questions ...................................................................... 46 

Kim P. Cawley, Chief of Natural and Physical Resources Cost Estimates 

Unit, Congressional Budget Office ..................................................................... 14 

Prepared statement .......................................................................................... 16 

Answers to submitted questions ...................................................................... 51 

Travis Kavulla, Commissioner, Montana Public Service Commission, President, National Association of Regulatory Utility Commissioners .................... 23 

Prepared statement .......................................................................................... 25 

Answers to submitted questions ...................................................................... 55 

(1) 

THE NUCLEAR WASTE FUND: BUDGETARY, 

FUNDING, AND SCORING ISSUES 

THURSDAY, DECEMBER 3, 2015 

HOUSE OF REPRESENTATIVES, SUBCOMMITTEE ON ENVIRONMENT AND THE ECONOMY, COMMITTEE ON ENERGY AND COMMERCE

Washington, DC. 

The subcommittee met, pursuant to call, at 9:59 a.m., in room 

1100, Longworth House Office Building, Hon. John Shimkus, 

(chairman of the subcommittee) presiding. 

Present: Representatives Shimkus, Harper, Murphy, Latta, Johnson, Bucshon, Flores, Hudson, Tonko, Schrader, Green, and 

McNerney. 

Staff Present: Nick Abraham, Legislative Associate, Energy and 

Power; Will Batson, Legislative Clerk, Energy and Power, Environment and the Economy; Jerry Couri, Senior Environmental Policy 

Advisor; David McCarthy, Chief Counsel, Environment and the 

Economy; Andy Zach, Professional Staff, Environment and the 

Economy; Rick Kessler, Minority Senior Advisor and Staff Director, 

Energy and Environment; and Timia Crisp, Minority AAAS Fellow. 

OPENING STATEMENT OF HON. JOHN SHIMKUS, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF ILLINOIS 

Mr. SHIMKUS. I am going to ask my colleagues who are here to 

take seats. And for those here, we want to, first of all, thank the 

Ways and Means Committee for their allowing us this palatial committee hearing room. We also want to move rapidly, because they 

are going to call votes real soon. So we want to get this thing started so we can get back here and get to the meat and potatoes of the 

hearing. 

Good morning, and welcome to today’s hearing to examine funding, budgetary, and scoring issues associated with efforts to manage and dispose of our Nation’s spent nuclear fuel and high-level 

radioactive waste. As Congress deals with the yearend budget 

issues, today’s testimony is timely. 

This subcommittee is continuing to examine specific challenges 

managing used fuel and national defense waste. Central to this discussion is providing adequate financial resources for a 

multigenerational repository program. In 1982, Congress passed 

the Nuclear Waste Policy Act, deciding commercial nuclear fuel 

consumers would fund permanent disposal of spent nuclear fuel 

through a one mil per kilowatt hour tax on nuclear-generated electricity to be paid into the Nuclear Waste Fund, and managed by 

the Department of Energy. 

2 

A DOE audit of the fund released just this morning projects its total current value is $34.3 billion, an increase in $1.4 billion over 

last year, and an $11 billion increase since 2009. This includes consumer payments, plus an interest calculation. Since the fee was instituted over 30 years ago, ratepayers in my home State of Illinois 

have contributed more than any other state at over $2.3 billion to 

the Nuclear Waste Fund. And I have paid some of that personally 

myself. 

The repository program was designed to be a multigenerational 

effort, which required long-term stability, so funding would be 

available at the most critical times of the program. The 1982 outlook for nuclear power was more optimistic than today’s. That 

means a shrinking fleet of operating reactors must provide adequate financial resources for a 100-year program. Meanwhile, the 

budgetary and scoring treatment of the Nuclear Waste Fund is broken. Comprehensive budget reconciliation measures enacted after 

1982 counted revenues from the fee as reducing the budget deficit 

in the fiscal year they were paid. Yet programmatic outlays remained on the discretionary side of the budget ledger and counts 

against annual budget caps. That means spending on the repository competes every year with other Federal budget priorities, such 

as maintaining our nuclear defense capability, or building Army 

Corps water projects. 

Today, we will get a better perspective as to how and why these 

budget changes have complicated the program to permanently dispose of used fuel. The Nuclear Waste Policy Act required the Federal Government to begin accepting fuel from commercial power 

plants by 1998, and DOE entered into contracts with plant operators to do just that, but DOE was not ready in 1998. As a result, 

commercial utilities started suing DOE for breach of contract, and 

the courts sided with the utilities. The damage payments are 

drawn from a permanent indefinite appropriation known as the 

Judgment Fund. Payments from the Judgment Fund don’t count 

against total spending caps. So policy makers have little incentive 

to stop the bleeding. 

Three weeks ago, DOE updated its annual cost estimate of liability for failure to fulfill its obligations as required by the Nuclear 

Waste Policy Act, which will ultimately all be paid from the Judgment Fund. DOE estimates lifetime liability to reach $23.7 billion. 

This is $1 billion increase over last year, and a $10 billion, or 50 

percent increase since President Obama shuttered the Yucca Mountain project. 

In 2014 the Federal Government paid out over $900 million from 

the Judgment Fund while not appropriating any money from the 

Nuclear Waste Fund for the Nuclear Regulatory Commission and 

DOE to work on the Yucca Mountain license application. That annual legal payment is nearly three times as much funding as the 

total amount the NRC needs to complete its review of the Yucca 

license. DOE’s projection is predicated on the ability to begin taking title of commercial spent nuclear fuel in 5 years. Recently, the 

subcommittee received testimony it would take at least 7 to 9 years 

to just begin transporting used fuel, regardless when a site is available. It is likely the liability will continue to skyrocket until we get 

the stalled program back on track. 

3 

Budgetary and funding challenges have been further complicated 

by President Obama’s legally dubious decision to walk away from 

Yucca Mountain. When DOE stopped work on the repository program, the National Association of Regulatory Utility Commissioners filed suit to halt collection of nuclear waste fee. The courts 

found DOE’s required financial projections absolutely useless, and 

based on pie-in-the-sky analysis. The decision stated the government’s argument was flatly unreasonable, and obviously disingenuous. The court directed DOE to halt the annual collection of $750 

million from ratepayers, but the payments by taxpayers for DOE’s 

breach of contract continue. 

I look forward to hearing from NARUC today about their experience with the Nuclear Waste Fund. I welcome all our witnesses 

and urge my colleagues to take advantage of their expertise as we 

prepare to sort this out, and hopefully in the future, fix it. Thank 

you. And I yield to Mr. Tonko for his opening statement. 

[The prepared statement of Mr. Shimkus follows:] 

PREPARED STATEMENT OF HON. JOHN SHIMKUS

Good morning and welcome to today’s hearing to examine funding, budgetary, and 

scoring issues associated with efforts to manage and dispose of our nation’s spent 

nuclear fuel and high-level radioactive waste. As Congress deals with year-end 

budget issues, today’s testimony is timely. 

This subcommittee is continuing to examine specific challenges managing used 

fuel and national defense waste. Central to this discussion is providing adequate financial resources for a multigenerational repository program. 

In 1982, Congress passed the Nuclear Waste Policy Act, deciding commercial nuclear power consumers would fund permanent disposal of spent nuclear fuel through 

a one mil per kilowatt hour tax on nuclear generated electricity to be paid in to the 

Nuclear Waste Fund and managed by the Department of Energy. 

A DOE audit of the Fund released just this morning projects its total current 

value at $34.3 billion, an increase of $1.4 billion over last year, and an $11 billion 

increase since 2009. This includes consumer payments plus an interest calculation. 

Since the fee was instituted over 30 years ago, ratepayers in my home State of Illinois have contributed more than any other state at over $2.3 billion to the Nuclear 

Waste Fund. 

The repository program was designed to be a multi-generational effort, which required long-term stability so funding would be available at the most critical times 

of the program. The 1982 outlook for nuclear power was more optimistic than today’s. That means a shrinking fleet of operating reactors must provide adequate financial resources for a 100 year program. 

Meanwhile, the budgetary and scoring treatment of the Nuclear Waste Fund is 

broken. Comprehensive budget reconciliation measures, enacted after 1982, counted 

revenues from the fee as reducing the budget deficit in the fiscal year they were 

paid. Yet programmatic outlays remained on the discretionary side of the budget 

ledger and counts against annual budget caps. That means spending on the repository competes every year with other Federal budget priorities, such as maintaining 

our nuclear defense capability or building Army Corps water projects. Today we will 

get a better perspective as to how and why these budget changes have complicated 

the program to permanently dispose of used fuel. 

The Nuclear Waste Policy Act required the Federal government to begin accepting 

fuel from commercial power plants by 1998, and DOE entered into contracts with 

plant operators to do just that. But DOE was not ready in 1998. As a result commercial utilities started suing DOE for breach of contract, and the courts sided with 

the utilities. The damage payments are drawn from a permanent, indefinite appropriation, known as the Judgment Fund. Payments from the Judgment Fund don’t 

count against total spending caps, so policymakers have little incentive to stop the 

bleeding. 

Three weeks ago, DOE updated its annual cost estimate of liability for failure to 

fulfill its obligations as required by the Nuclear Waste Policy Act, which will ultimately all be paid from the Judgment Fund. DOE estimates lifetime liability to 

reach $23.7 billion. This is a billion dollar increase over last year, and $10 billion 

4 

dollar—or fifty percent—increase since President Obama shuttered the Yucca Mountain program. In 2014 alone, the Federal government paid out over $900 million 

from the Judgment Fund, while not appropriating any money from the Nuclear 

Waste Fund for the Nuclear Regulatory Commission and DOE to work on the Yucca 

Mountain license application. That annual legal payment is nearly three times as 

much funding as the total amount the NRC needs to complete its review of the 

Yucca license. 

DOE’s projection is predicated on the ability to begin taking title of commercial 

spent nuclear fuel in five years. Recently, the Subcommittee received testimony it 

would take at least seven to nine years to just to begin transporting used fuel, regardless when a site is available. It is likely the liability will continue to skyrocket 

until we get the stalled program back on track. 

Budgetary and funding challenges have been further complicated by President 

Obama’s legally dubious decision to walk away from Yucca Mountain. When DOE 

stopped work on the repository program, the National Association of Regulatory 

Utility Commissioners filed suit to halt collection of the nuclear waste fee. The 

Courts found DOE’s required financial projections ‘‘absolutely useless’’ and based on 

‘‘pie in the sky’’ analysis. The decision stated the government’s argument was ‘‘flatly 

unreasonable,’’ and ‘‘obviously disingenuous.’’ 

The Court directed DOE to halt the annual collection of $750 million from ratepayers, but the payments by taxpayers for DOE’s breach of contract continue. I look 

forward to hearing from NARUC today about their experience with the Nuclear 

Waste Fund. 

I welcome all our witnesses and urge my colleagues to take advantage of their 

expertise as we prepare to sort this out and fix it. 

Mr. TONKO. Thank you, Chair Shimkus, and good morning to our 

panelists. Thank you all for being here on what has become a very 

busy week. 

We all know the politics behind nuclear waste disposal are complicated. So it should come as no surprise that the budgetary and 

legislative histories are equally complex. 

In 1982, Congress passed its Nuclear Waste Policy Act, directing 

the Department of Energy to remove spent nuclear fuel from commercial nuclear power plants in exchange for certain fees and 

transport it to a permanent geologic repository, beginning no later 

than January 31, 1998. 

Obviously, that deadline has been missed. Utilities that generate 

nuclear waste had been paying an ongoing fee of one mil per kilowatt hour of nuclear-generated electricity. These fees were deposited in the Nuclear Waste Fund to cover the cost of the Department 

of Energy’s acceptance, transport, and disposal of civilian nuclear 

waste. But the fund has not worked as intended. I am sure we will 

get into the recent history and options moving forward later in this 

hearing. 

More than 60 years after beginning and expanding our use of nuclear materials, nuclear waste disposal remains a difficult and an 

expensive problem. We will have to deal with 74,000 metric tons 

of commercial spent fuel, with more being added each and every 

year. And I agree that we should be looking at all options for nuclear waste disposal in an effort to find the safest and the most 

cost-effective ways for us as a Nation to move forward. But we 

must recognize and deal with both the technical and the political 

challenges of disposing of all classes of nuclear waste. 

During this Congress, this subcommittee has examined a variety 

of nuclear waste disposal issues. I’m glad we are able to continue 

that work today. I thank you all again for your participation in this 

morning’s activities. I look forward to your testimony and further 

5 

discussion of what is a very important issue. And with that, I yield 

back, Mr. Chair. 

Mr. SHIMKUS. The gentleman yields back his time. 

The chair looks to the majority side. No one is seeking recognition. 

Anyone on the minority side? 

Seeing none, we want to thank my colleagues for moving expeditiously, and now welcome our witnesses. And we are going to admit 

your full statements into the record. We will ask you to speak for 

5 minutes. And we will hopefully get to questions and answers. 

So I will introduce you one at a time. First it will be Mr. David 

Bearden, who has appeared before the subcommittee numerous 

times, or the committee as a whole, specialist in environmental policy for the Congressional Research Service. Welcome, and you are 

recognized for 5 minutes. 

STATEMENTS OF DAVID BEARDEN, SPECIALIST IN ENVIRONMENTAL POLICY, CONGRESSIONAL RESEARCH SERVICE; 

KIM P. CAWLEY, CHIEF OF NATURAL AND PHYSICAL RESOURCES COST ESTIMATES UNIT, CONGRESSIONAL BUDGET 

OFFICE; AND TRAVIS KAVULLA, COMMISSIONER, MONTANA 

PUBLIC SERVICE COMMISSION, PRESIDENT, NATIONAL ASSOCIATION OF REGULATORY UTILITY COMMISSIONERS 

STATEMENT OF DAVID BEARDEN 

Mr. BEARDEN. Chairman Shimkus, Ranking Member Tonko, and 

members of the subcommittee, my name is David Bearden. I am a 

specialist in environmental policy for the Congressional Research 

Service, called CRS. Thank you for inviting me to testify on behalf 

of the agency. In serving the U.S. Congress on a nonpartisan and 

objective basis, CRS takes no position on any of the issues examined today. CRS has been asked by the subcommittee to outline the 

budgetary framework for the management of the Nuclear Waste 

Fund. CRS also maintains a team of policy analysts and legislative 

attorneys who have prepared reports on an array of complex issues 

associated with the Nuclear Waste Fund, and so we remain available to assist the subcommittee and the full committee with broader issues than addressed in my testimony today. 

In terms of the statutory framework, as the chairman mentioned 

at the beginning in his opening remarks, section 302 of the Nuclear 

Waste Policy Act of 1982 established the Nuclear Waste Fund, financed primarily with the collection of fees from civilian nuclear 

utilities to fund the permanent disposal of their spent or used nuclear fuel and related wastes. As amended, the statute authorizes 

the Department of Energy, DOE, to develop a deep geologic repository for the disposal of these wastes, subject to licensing by the 

U.S. Nuclear Regulatory Commission. 

The development of a repository and the selection of Yucca 

Mountain in Nevada for its location have been the subject of various scientific, technical, regulatory, budgetary, legal, and policy 

debates. The lack of a repository to accept spent or used nuclear 

fuel has been an ongoing issue. Nuclear utilities have paid fees to 

finance the Nuclear Waste Fund and entered contracts with the 

6 

Federal Government for the disposal of their spent or used nuclear 

fuel by the statutory deadline of January 31, 1998. 

Appropriations acts have made monies from the fund available to 

DOE and the Nuclear Regulatory Commission to support the licensing process, but construction of a repository could not begin 

until NRC approves the license pursuant to the Nuclear Waste Policy Act. Nuclear utilities have filed damage claims against DOE for 

partial breach of existing contracts to cover their spent or used nuclear fuel storage costs in the interim while a repository has been 

unavailable since the statutory deadline lapsed. 

The Nuclear Waste Fund is not explicitly authorized to pay damage claims. So the Judgment Fund of the U.S. Treasury, therefore, 

has been the source of Federal funds for the payment of eligible 

claims. DOE has reported that a total of $5.3 billion in eligible 

claims have been paid from the Judgment Fund as of the end of 

fiscal year 2015. 

Now I will just briefly outline the basic budgetary framework of 

the fund itself and existing law. As authorized in the Nuclear 

Waste Policy Act, receipts from the nuclear utility fee collections 

are deposited in the fiscal year they are collected into the U.S. 

Treasury and credited to the Nuclear Waste Fund as assets available for discretionary appropriations. 

The receipts are not treated as a revenue or offsetting collections 

for discretionary spending, though. They are treated as negative direct spending that has the effect of reducing total Federal direct 

spending in the fiscal year in which the receipts are collected. The 

accumulated balance of past collections does not continue to count 

as a reduction to direct spending in future fiscal years, though, as 

it would result in the double counting of receipts. 

The unappropriated balance of the Nuclear Waste Fund is invested in U.S. Treasury securities that accrue interest credited to 

the fund that contributes to the total balance available for discretionary appropriation. The assets credited to the Nuclear Waste 

Fund from the nuclear utility fee collections are a liability to the 

general fund of the U.S. Treasury to provide these assets once discretionary appropriations are enacted. Regardless of the accumulated balance, though, appropriations from the fund remain subject 

to limitations on annual discretionary spending. And this framework for the fund is not unique within the Federal budget, though. 

Some other examples include the Harbor Maintenance Trust Fund, 

the Hazardous Substance Superfund Trust Fund, Leaking Underground Storage Tank Trust Fund, and the Uranium Enrichment 

Decontamination and Decommissioning Fund. 

And in its department-wide financial report for fiscal year 2015, 

DOE reported a balance in the Nuclear Waste Fund of $34.3 billion 

in net investments and related interest combined. And those investments refer to fee collections. There have been no new receipts 

credited to the fund from nuclear utility fees since the suspension 

of the collections on May 16, 2014 as a result of litigation challenging the present need for the fees. However, interest has continued to accrue, increasing the balance each year. 

So under current law, and existing budgetary procedural requirements, the unappropriated balance of the Nuclear Waste Fund does 

remain available for appropriation to carry out the purposes of the 

7 

Nuclear Waste Policy Act, but it is subject to applicable limitations 

on Federal spending. The budgetary treatment of the receipts does 

not permit past collections to be applied as an offset to future 

spending, but other potential budgetary options may be dependent 

upon amendments or exceptions to current law or existing procedures. 

So that concludes the remarks of my prepared statement. Thank 

you for the opportunity to appear before the subcommittee today, 

and I will be happy to address any questions you may have. 

[The prepared statement of Mr. Bearden follows:] 

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Mr. SHIMKUS. Thank you very much. We look forward to answering questions because that was very confusing. 

Now, we would like to turn to Mr. Cawley, Chief of Natural and 

Physical Resources Cost Estimate Unit of the Congressional Budget Office. You are recognized for 5 minutes. 

STATEMENT OF KIM P. CAWLEY 

Mr. CAWLEY. Mr. Chairman and members of the committee, 

thank you for the invitation to present CBO’s review of the status 

of the Nuclear Waste Fund, and to try to explain the budgetary 

treatment of the fund. 

I think if we look back over the last 33 years, about $22 billion 

has been collected from nuclear power ratepayers, and about onethird of that has been spent on the waste disposal system. Five 

years ago, the administration found that developing the Yucca 

Mountain site for the disposal of waste was unworkable, and there 

has been no significant spending on the site project in recent years. 

Last year, as a result of a Federal court order, the Department 

stopped collecting the nuclear waste fee from electricity ratepayers. 

Those fees had amounted to about $750 million a year, and they 

were stopped because the court found the Department could not 

demonstrate whether the fee collections were too small or too large 

relative to the expected life cycle cost of the program. 

Although the government is not collecting the waste fees, and is 

not spending any of the previous fee collections, the government is 

incurring another type of cost. Under the contracts the Department 

of Energy signed after the 1982 Act, we were set to begin accepting 

waste for disposal 17 years ago. Shortly after the deadline was 

missed in 1998, utilities filed claims and won judgments for a partial breach of the disposal contracts. At this point, the Federal taxpayers, through the Treasury’s Judgment Fund, have paid over $5 

billion to utilities as compensation for the breach. CBO expects 

that utilities will collect another $5 billion more in compensation 

in the coming decade. In the simplest terms, today the government 

is using taxpayer funds to pay for private storage of waste instead 

of spending ratepayer fees to permanently dispose of the waste as 

authorized in the 1982 Act. 

I wanted to make a couple of points about the nuclear waste program budget and the enforcement procedures that Congress uses in 

the congressional budget process. 

The fund accounts for both the receipt of fees from utilities, and 

amounts provided through the annual appropriations process. In 

addition, interest is credited and it becomes available to be spent 

for program purposes. In the congressional budget process, there is 

a distinction made between mandatory spending, that operates 

under permanent law, and discretionary spending, that flows from 

annual appropriations acts. 

The waste program has one foot in each of these spending categories. The fee collections are part of the mandatory category, and 

spending on waste disposal activities is in the discretionary category. To control legislative changes to the budget, the Congress established the pay-as-you-go system for mandatory spending, and 

currently, discretionary spending is controlled through a system of 

caps on total spending. As was mentioned, the split mandatory/disVerDate Nov 24 2008 11:06 Apr 22, 2016 Jkt 037690 PO 00000 Frm 00018 Fmt 6633 Sfmt 6633 F:\MY DOCS\HEARINGS 114\114-106 CHRIS
15 

cretionary treatment of the waste program is not unique in the 

budget. There are other programs with a similar treatment. 

In very practical terms, I think the program’s budgetary treatment means two things: First, any future appropriations for the 

waste program will need to compete for funding along with all 

other discretionary Federal programs that are controlled by the 

caps on spending. The unspent balances in the fund cannot be used 

unless those amounts are appropriated. The collection of those balances in previous years helped to reduce the deficits in those earlier years, but they have no budgetary effect in future years. 

Second, if the waste fees are reinstated in the future, they will 

reduce the deficit. But those mandatory collections cannot be credited to, or directly offset the cost of discretionary appropriations for 

spending on the program. 

I think that is a good point for me to stop talking about the 

budget, and I would be happy to answer any of your questions. 

[The statement of Mr. Cawley follows:] 

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Mr. SHIMKUS. Thank you very much. 

And just for my colleagues, we will finish the opening statements, though they have called votes. We will go to the floor after 

the opening statements, and then we will return for the question 

period. 

So last but not least, we would like to recognize Travis Kavulla, 

Commissioner, Montana Public Service Commission, president of 

the National Association of Regulatory Utility Commissioners. Welcome, and you are recognized for 5 minutes. 

STATEMENT OF TRAVIS KAVULLA 

Mr. KAVULLA. Thank you, Chairman Shimkus and Ranking 

Member Tonko, members of the subcommittee, it is a pleasure to 

be before you today. I am the president of the National Association 

of Regulatory Utility Commissioners, which has long been involved 

in this issue from a policymaking and litigation front. NARUC applauds this subcommittee’s tenacity and leadership on these issues. 

Unlike the previous two speakers, we have a full-throated and unambiguous opinion on this matter as well, which I will be happy 

to share with you today. 

NARUC is a nonprofit organization founded in 1889. Our members are the public utility commissions in all 50 states and U.S. 

territories. We regulate the retail rates and services of electric, gas, 

water, and some telecommunications utilities. NARUC and its 

state commission members were at the table when the Nuclear 

Waste Policy Act of 1982 was developed and passed. And at that 

time and today, state regulators agree that users of electricity from 

nuclear power plants should pay for the Federal nuclear waste 

management and disposal program. And the consumers have paid 

generously into that fund. Since 1982, more than $40 billion in direct payments and interests have been paid into the Nuclear Waste 

Fund. And so far, we have very little to show for it, just an $11 

billion hole in the ground, to be exact. The Federal Government 

missed its statutorily-mandated deadline to start accepting nuclear 

waste in 1998. In the late 1990s and early 2000s, at least, the program had shown progress, notwithstanding that missed deadline. 

However, since that time, efforts to block funding for the geologic 

disposal of nuclear waste at Yucca Mountain, as well as the Department of Energy’s unlawful refusal to consider the project’s licensing application, has kept the country in the exact same situation we occupied 28 years ago when Congress decided that Yucca 

Mountain should be the first site considered for the United States’ 

permanent repository. The repercussions of the administration’s 

failure to take title of nuclear waste and to develop the Yucca 

Mountain site have been substantial. 

Now taxpayers from each of your constituencies, even those 

whose utilities have no stake in nuclear-generated electricity, continue to fund court-awarded damages from the Department of Justice’s Judgment Fund for DOE’s partial breach of contract. 

The chairman and ranking member have described very well, I 

think, the history of some of these problems. So in the interest of 

cutting it short, I will move on to a few things NARUC views as 

solutions. 

24 

First, access to the billions collected by the Nuclear Waste Fund 

is essential for any interim or permanent solution to nuclear waste 

disposal to succeed. Appropriations for the waste disposal program 

remain under the spending cap applicable to all domestic programs, even though the NWF is self-financed. This forces, as you 

just heard, spending from the NWF to compete with other spending 

programs that never have had a dedicated funding stream. This approach is unfair to ratepayers, and inappropriate for a fund designed to finance the extremely protracted life cycle of a capital intensive disposal program. 

It makes no sense to treat funds collected specifically to support 

the disposal of used commercial reactor fuel as discretionary. Over 

the life of the program, this approach has led to lower appropriations than were requested to accomplish this mission. Reduced 

funding contributed to project and schedule delays. Inadequate 

funding can only hamper efficient scheduling and planning, thereby 

driving up costs. The program must have full access to the revenues generated by consumers’ fee payments if they resume, as well 

as to the balance of the NWF. This requires legislative changes to 

the NWPA. 

As related above, the U.S. Government has not lived up to the 

promises made under the NWPA and subsequent congressional enactments. This is really not a matter of opinion, but of legal record. 

And of particular relevance is the decision that the chairman cited 

from the Circuit Court of Appeals regarding the DOE fee collection. 

I think this sorry history strongly suggests that the management 

of Federal responsibilities for integrated-used fuel should be more 

successful if they were assigned to a new organization with a single-minded devotion to the cause of permanently storing used fuel. 

Congress should charter a new Federal corporation dedicated solely 

to implementing the nuclear waste management program and empowered with the authority and resources, including direct access 

to the NWF outside the current appropriations process that is necessary for such a mission to succeed. 

Congress would still have oversight over those, but they would 

be separately dedicated to the use by that organization. If implemented in the near term, these ideas can help create a solid foundation on which to build a viable spent nuclear fuel management 

program. NARUC is certainly open to the idea of interim solutions 

where nuclear fuel is stored, but these interim sites cannot be allowed to be mere parking lots in the absence of a permanent storage solution. 

Thank you very much, and I look forward to questions. 

[The statement of Mr. Kavulla follows:] 

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Mr. SHIMKUS. Thank you very much. 

For my colleagues, there are 7 minutes remaining on the floor to 

cast our votes. So we will, in a minute, recess. For our panelists, 

there are seven votes called. That is a good 45 minutes to an hour. 

So hang around the building, get coffee, and we will be back to 

delve more deeply into this. We thank you for your time. And with 

that I am going to recess the hearing. 

[Recess.] 

Mr. SHIMKUS. We will call the hearing back in order. Again, 

apologize for the long delay, but we have to do our job, which is 

voting on the floor also. Thank you for the opening statements. We 

will go into the questions. And I will begin. I will recognize myself 

5 minutes to start the questioning. 

The first one is for Mr. Kavulla. And I know, Mr. Kavulla, you 

have to leave. I have been informed. So when you have to go, just 

get up and go. Hopefully we will direct the questions that we can 

to you early enough to get responses, so hence, the first one. 

At a recent subcommittee hearing to examine the issues associated with transportation of nuclear materials, expert witnesses testified that pursuing consolidated interim storage for spent nuclear 

fuel would likely increase life cycle costs as a result of having to 

ship material more than once. The last DOE life cycle cost analysis 

for Yucca Mountain estimated total transportation costs to exceed 

$20 billion over the associated 70-year national transportation campaign. 

You stated your concern with the possibility that consolidated interim storage would increase the financial burden on ratepayers 

without a justifiable return on investment, such as a reduction in 

payment from the judgment fund. What exactly is necessary to provide assurance that any authorization for consolidated interim storage is in the interest of electric ratepayers? 

Mr. KAVULLA. Thank you, Mr. Chairman, for that question. I 

think the answer is that there needs to be unambiguously a costbenefit analysis done of this. My real concern, on behalf of NARUC, 

is that we would establish these consolidated storage sites as an interim solution, but then they would become de facto, permanent 

sites rather than the kind of parking lot that undergirds the concept. 

So there needs to be more costing than has already been done. 

The sites, at least one of the sites that has raised its hand on a 

consent basis is one in New Mexico, but they have been very clear 

in that state that they are unwilling to go forward without the designation of a permanent repository. So I would imagine you would 

have difficulty of the same type you face in the Yucca Mountain 

issue with even identifying those interim locations. 

So I think, my own personal opinion on this, is that you would 

need to have a clear linkage between the interim site and the permanent site in the same breadth, acknowledging that it may be a 

reasonable idea because, realistically, we are decades off of creating 

a permanent repository, one way or another. 

Mr. SHIMKUS. Thank you very much. 

Now, for Mr. Bearden and Mr. Cawley, in both your testimonies, 

you reference potential issues of double-counting previous revenue 

from the nuclear waste fee that has been collected over the preVerDate Nov 24 2008 11:06 Apr 22, 2016 Jkt 037690 PO 00000 Frm 00040 Fmt 6633 Sfmt 6633 F:\MY DOCS\HEARINGS 114\114-106 CHRIS
37 

vious 30 years. For clarification, if Congress were to appropriate 

funding from the Nuclear Waste Fund on activities for which it was 

collected, under our scoring rules, I guess my question is, would 

Congress be increasing the Federal deficit? 

Mr. CAWLEY. Right. If next year, Congress were to appropriate $100 million from the Nuclear Waste Fund, that would add to the 

deficit in that year. 

Mr. SHIMKUS. Mr. Bearden, would you agree? 

Mr. BEARDEN. Well, most certainly I would agree with CBO in 

how they would score any impacts on the deficit. If funding were 

appropriated out of the Nuclear Waste Fund, within the discretionary spending caps, it would be part of that discretionary spending total and the effects it would have on the deficit. 

Mr. SHIMKUS. What exactly, then, is accounted for in the Nuclear 

Waste Fund audit release this morning by the Department of Energy inspector general? 

Mr. BEARDEN. I am not quite sure I understand your question. 

What is accounted for? 

Mr. SHIMKUS. Yes. Obviously, the audit was released today, so 

what are they accounting for in the release for that audit in their 

numbers? 

Mr. BEARDEN. Well, their numbers are reflecting what is the 

total balance of investments, which are the nuclear utility fee collections and the interest combined. That is available for discretionary appropriation, that $34.3 billion figure, by the end of fiscal 

year 2015. How Congress can use that money and the amounts 

each year are going to depend on the priorities when the discretionary spending caps. 

Mr. SHIMKUS. Great. Let me just finish up with Mr. Kavulla. 

NARUC’s previous testimony suggested that Congress could structure payments from the utilities into an escrow account which 

would not be provided to the Federal Government until funding is 

appropriated by Congress. Please describe how this would protect 

the ratepayers? 

Mr. KAVULLA. So in the other witnesses’ testimony, Mr. Chairman, you heard examples of funds that work in the way this one 

does. It’s NARUC’s testimony that this budget approach for something like the disposal of nuclear waste really doesn’t make sense 

when you are talking about a life cycle of many, many decades, 

possibly in excess of a century. It shouldn’t be subject to annual appropriation decisions by Congress. 

The idea of an escrow account would be to maintain congressional oversight and authority over spending, even while making 

clear that the funding went into a fund available, for instance, by 

an independent body charged with oversight exclusively of used 

waste disposal. There are other examples of funds that are similar 

to this. The universal service fund that USEC administers is similar, special purpose fund that is subject in congressional oversight, 

but which is not subject to an annual appropriation. 

Mr. SHIMKUS. Great. Thank you. My time has expired. 

I was just going to end by saying, mandatory receipts, discretionary spending with possible deficit implications. That is why it 

is very confusing for us. 

And I recognize Mr. Tonko for 5 minutes. 

38 

Mr. TONKO. Thank you, Mr. Chair. 

And, Mr. Cawley, you called the Nuclear Waste Fund an accounting mechanism. Is it a trust fund as we think of trust funds in a 

traditional sense? 

Mr. CAWLEY. It is categorized in the budget as a special fund. 

Like other funds in the Federal budget, they are used to account 

for moneys. The Treasury manages all of the cash on a unified 

basis, so when we want to spend money that has accumulated in 

these funds, that requires new spending. 

Mr. TONKO. Let me ask this then: The funding collected has already been used to offset past Federal deficits, so moving forward, 

that money would need to be appropriated as discretionary funding 

from the current fiscal year at that time. Do I have that right? 

Mr. CAWLEY. That is right. Yes. 

Mr. TONKO. OK. So from CBO’s perspective, despite the collection 

of fees in the past, would a change in the law that would allow the 

waste disposal process to resume score and score significantly? 

Mr. CAWLEY. I guess I am not sure what the change in the law 

would be, but in the simplest terms, allowing the waste program 

to go forward could be just the appropriation of X million dollars, 

and that would be costed along with all other discretionary appropriations in that year, presumably under the cap that controls all 

discretionary appropriations in that year. 

Mr. TONKO. And, Mr. Bearden, are there other programs that use 

this accounting mechanism that are being appropriated discretionary funding annually based on a user fee paid to the Treasury? 

Mr. BEARDEN. Yes, some of the examples that I provided in my 

testimony with discretionary funding are the Superfund Trust 

Fund, Leaking Underground Storage Tank Trust Fund, Uranium 

Enrichment Decontamination and Decommissioning Fund, those 

are other examples. 

Mr. TONKO. Have these funds been as troubled with their accounting mechanism? 

Mr. BEARDEN. Each of them has had their own set of issues and 

viewpoints. For example, the Leaking Underground Storage Tank 

Trust Fund receipts accumulated at a faster pace than Congress 

appropriated, under the discretionary process leading to a higher 

balance than moneys going out. That is an example of an issue 

with that particular fund. That has dedicated receipts, but the use 

of it is subject to discretionary appropriations. 

Mr. TONKO. Thank you. 

Let me toss out a hypothetical, and it would include either this 

or a future administration reevaluating Yucca Mountain, or Congress changing the law about the location of a permanent geologic 

repository for the uses of nuclear waste fund fees. Do you believe 

the Secretary of Energy, under existing authorities, could begin reassessing fees, which have been stopped since May of 2014? 

Mr. CAWLEY. We think the fees could conceivably be charged 

again under administrative changes, absent a change in law. The 

court found, in our view, that DOE had not done a fee adequacy 

study correctly because it couldn’t demonstrate if these fees were 

sufficient to pay the life cycle cost. Presumably, that study could 

be redone in a different way, and demonstrate to the court that 

39 

these fees either are sufficient or are insufficient to pay for the life 

cycle cost of the program. 

In the original Act, DOE has the authority to administratively 

change the fee, present that proposed change to the Congress, and 

if Congress doesn’t act, the fee change goes forward. 

Mr. TONKO. And are there concerns with the existing contracts, 

with utilities that might make this more difficult? 

Mr. CAWLEY. Might make a change to the fee difficult or a—— 

Mr. TONKO. Yes. Or the assessing of the fees or—— 

Mr. CAWLEY. I can’t think of any. 

Mr. TONKO. OK. And, Mr. Bearden, can you explain the process 

for changing this fee. There is analysis by the Secretary of Energy 

that determined the appropriate fee, but then it must be submitted 

to Congress, I believe, for adjustment. Is that—— 

Mr. BEARDEN. Yes, for review. Is that what you are asking? 

Mr. TONKO. Yes. 

Mr. BEARDEN. Yes. There is a process of a review for that. 

Mr. TONKO. Thank you. 

And, Mr. Kavulla, the industry estimates $50 billion in damages 

for utilities with DOE contracts. DOE’s total liability estimate is 

$29 billion. Can you explain this discrepancy. 

Mr. KAVULLA. Mr. Congressman, I really cannot speak for the industry on this point. I do know that DOE had suggested a number, 

I believe, that was nearly $20 billion in size. I am not sure of the 

$9 billion exposure, but it is true what you have said; in my testimony, there is a citation to an industry estimate of about $50 billion. 

I think the bottom line here is that there is a large amount of 

exposure, and whatever the ultimate liability may be, there is a 

collection of $750 million annually with a lot of unresolved claims 

that are still pending. 

Mr. TONKO. Thank you. 

My time is up, so I yield back. 

Mr. SHIMKUS. I thank my colleague and friend, and I turn to 

Congressman Johnson from Ohio for 5 minutes. 

Mr. JOHNSON. Thank you, Mr. Chairman. And thank you, gentlemen, for joining us today. 

Mr. Bearden, in addition to finding a disposal pathway for commercial spent nuclear fuel, the Nuclear Waste Policy Act required 

a determination regarding a management of the nuclear waste 

from atomic defense activities. What was the anticipated disposal 

path for that material? 

Mr. BEARDEN. Well, there are possible pathways of disposal for 

that material, including a separate repository or a consolidated repository, and the administration had issued its finding of moving 

forward with planning for a separate repository for defense waste, 

if that is what you are referring to. 

Mr. JOHNSON. OK. So what would it mean for defense accounts 

if we choose to pursue an entirely new disposal pathway for this 

type of material? 

Mr. BEARDEN. Well, any disposal facility for defense nuclear 

waste would be subject to appropriation by Congress to have the 

resources available for certain. 

40 

Mr. JOHNSON. OK. Mr. Cawley, would that funding be subject to 

the current caps on defense spending under the Budget Control Act 

and, therefore, compete with other defense account activities as 

well? 

Mr. CAWLEY. Sounds like it would, yes. 

Mr. JOHNSON. I am sorry? 

Mr. CAWLEY. It sounds like it would, yes. 

Mr. JOHNSON. OK. All right. You know, the Department of Energy recently found that its estimated liabilities for failure to accept commercial spent nuclear fuel is over $23 billion. That is an 

annual increase over $1 billion. This estimate, of course, is predicated on achieving the Department’s strategy on used fuel management, and their ability to begin accepting title to stranded spent 

nuclear fuel in 5 years. 

So, Mr. Cawley and Mr. Bearden, will you describe how the development and operation of a pilot interim storage as the administration proposes would impact the overall estimated liability? And 

you can choose who goes first. I don’t care. 

Mr. CAWLEY. I have heard the Department’s estimate of their liability of some $23, $24 billion described as depending on their implementation of their strategy which would have a storage facility 

during the next 10 years. 

Mr. JOHNSON. So it is safe to say that it is significant? 

Mr. CAWLEY. Yes. 

Mr. JOHNSON. OK. Mr. Bearden, do you have a comment on that? 

Mr. BEARDEN. Well, as with any strategy of any administration, 

it would depend ultimately on implementation and the assumptions that it would be made for that, for that to result in the outcomes that they are estimating. And certainly, that involves a lot 

of complexities, and CRS would be happy to work with the committee to discuss those issues and challenges with you at your convenience. 

Mr. JOHNSON. OK. What portion of DOE’s projected liability is 

tied to only the dozen sites that are completely decommissioned, 

absent removal of the spent nuclear fuel? Either of you want to 

comment on that? 

Mr. CAWLEY. I don’t have a specific answer to that question, but 

I do know that under the original contracts, at this point, DOE was 

to have removed approximately 40,000 metric tons of waste out of 

the some 72,000 metric tons of waste that exists. It doesn’t address 

specifically the spent fuel at the facilities that have closed. Some 

of that, no doubt, should have been removed by this time. 

Mr. JOHNSON. Can you take that question for the record, please, 

and do some research on that and get back to us? 

Mr. CAWLEY. Certainly. 

Mr. JOHNSON. OK. Thank you. 

Mr. Bearden, the Nuclear Waste Policy Act included a number 

of provisions to provide financial assistance to State-affected local 

and tribal governments. Will you please describe what this funding 

was intended to support? 

Mr. BEARDEN. There is a range of funding authorized subject to 

appropriation from the Nuclear Waste Fund for affected units of 

local government, states, and tribes. Some of that is for oversight 

during the licensing process and other assistance, and some of the 

41 

totals of that have been approximately $520 million, at least at the 

end of fiscal year 2009 that I am familiar with, and so, that assistance partly is to go for the oversight and the licensing process. 

Mr. JOHNSON. Are you aware of how much funding has previously been directed to the State of Nevada and local and tribal 

governments? 

Mr. BEARDEN. I do not have that figure with me today, but I 

would be happy to provide that as a follow-up response for the 

record. 

Mr. JOHNSON. Mr. Kavulla, your organization is on record supporting reasonable economic benefits and incentives for host states 

and communities. Would you like to discuss very briefly—because 

my time is expired—the nature of those benefits and the role of 

Federal-State partnerships? 

Mr. KAVULLA. Congressman, I would be happy to follow up in 

more detail, but briefly, we acknowledge that this is liability for a 

State to take on. We agree that there needs to be some concessions 

made for units of local government to take them on. But those need 

to be tied to, frankly, the scope of the responsibilities they are 

shouldering, and not, I think, just to give away that would ultimately be placed on the consuming rate-paying public—— 

Mr. JOHNSON. OK. My time has expired. Would you provide an 

expanded answer to that? 

Mr. KAVULLA. I would be happy to. 

Mr. JOHNSON. Mr. Chairman, I yield back. 

Mr. SHIMKUS. The gentleman yields back. 

We now recognize Mr. Green from Texas for 5 minutes. 

Mr. GREEN. Thank you, Mr. Chairman. I am trying to get used 

to this Ways and Means Committee room. You think we could take 

some of our jurisdiction when we leave that they took from us over 

the years? 

But anyway, I want to welcome our colleagues from the agencies. 

The success of our Nation’s nuclear waste management program 

is dependent on making fees raised from the Nuclear Waste Fund 

available as needed for construction, transportation, and storage of 

high-level nuclear waste. This is not the case currently. Congressional action, after the enactment of Nuclear Waste Policy Act, has 

sharply limited the ability of responsible agencies to access the 

funds to study, construct a storage facility, be it interim or permanent. 

As the committee of jurisdiction, we must begin to process 

affixing this broken system, uphold the Federal Government’s contractual obligations to the ratepayers, and ensure a clear path for 

the prompt licensing and construction of permanent storage facility. 

Mr. Cawley, what is the current amount of money in the Nuclear 

Waste Fund? 

Mr. CAWLEY. Current balance is shown on table 1 in my prepared testimony. It is about $34 billion. 

Mr. GREEN. Pardon? $34 million or billion? 

Mr. CAWLEY. Billion. 

Mr. GREEN. OK. How much of the money has the Federal Government currently paid in damages to the electric utilities for failing to take the title of civilian nuclear waste by the required date? 

42 

Mr. CAWLEY. So far, we have paid approximately $5.3 billion. In 

the coming decade, we expect it will be about $5 billion more. 

Mr. GREEN. You note in your testimony, several utilities have not 

paid their one-time fee into the Nuclear Waste Fund. Does CBO 

know how much these outstanding one-time fees are valued at? 

Mr. CAWLEY. One-time fees currently have a value of about $1.6 

billion. 

Mr. GREEN. Is the Department of Energy currently doing anything to collect those outstanding fees from the utilities? 

Mr. CAWLEY. The one-time fees was an option given to utilities 

back at the beginning of the Act, and they are due when their first 

delivery of waste to a repository is made. 

Mr. GREEN. Mr. Kavulla, is our Nation’s current system for highlevel nuclear waste working for the people of your state? 

Mr. KAVULLA. Well, Congressman, no. Montana has no nuclear 

waste and shouldn’t be paying, frankly, for any of this. And the 

irony of the Federal policy is that through the damages awarded 

against DOE, even taxpayers of those States who have no connection with nuclear-generated electricity are, nonetheless, paying for 

this problem. 

Mr. GREEN. As a supporter of nuclear energy and expansion, and 

coming from Texas where we are trying to look at a midlevel waste 

facility in West Texas that obviously we need—and if you want nuclear power, we have to have some place, whether it be the temporary storage on site, the interim storage, or ultimately the longterm storage, but I can’t say we have the solution, because there 

is no country in the world that has long-term storage. 

You know, France, who generates a great deal of their electricity 

from nuclear. Sweden, actually, has a big hole in the ground. But 

I asked how they afforded that, and they said, well, what they 

would call their local jurisdiction, it was a prototype, but they 

agreed they would never put anything in there. So, everybody 

wants their electricity turned on but we don’t know where to put 

the nuclear waste. 

Do you believe the ratepayers in Montana and other states represented by NARUC have confidence in the Federal Government 

and Congress to fix the current system? 

Mr. KAVULLA. Well, I have confidence, I hope, Congressman, that 

your subcommittee will do something about this. 

Mr. GREEN. I wish I had confidence we would fix it. 

Mr. Bearden, in the last 50 seconds, how are PAYGO requirements created under the enactment of the NWPA impacting the 

Energy Department’s access to funds currently in the Nuclear 

Waste Fund? 

Mr. BEARDEN. Well, the access to those funds is dependent on 

the appropriations under the discretionary process, so it is the discretionary spending limits that are affecting the availability of 

moneys that Congress can prioritize each year out of the Nuclear 

Waste Fund. 

Mr. GREEN. Has the Budget Control Act of 2011 limited the Federal Government’s access to the money in the Nuclear Waste Fund? 

Mr. BEARDEN. To the extent that there are caps on overall discretionary spending, that pressure that is on all discretionary spendVerDate Nov 24 2008 11:06 Apr 22, 2016 Jkt 037690 PO 00000 Frm 00046 Fmt 6633 Sfmt 6633 F:\MY DOCS\HEARINGS 114\114-106 CHRIS
43 

ing and is also on appropriations that would come from the Nuclear 

Waste Fund. 

Mr. GREEN. If Congress were to create a single-purpose, independent corporation for nuclear waste storage, how would Congress 

continue to ensure the strong oversight by such an entity? 

Mr. BEARDEN. That would depend on the legislation that sets up 

the agency roles, and how that may be overseen and what the nature of that entity is, so it would not be possible to answer that 

without knowing all those details. 

Mr. GREEN. Thank you, Mr. Chairman. 

Mr. SHIMKUS. Gentleman yields back his time. 

And just for a point of information, last month, Finland’s government became the first to approve construction on such a long-term 

storage—Finland—a deep underground repository after more than 

30 years of efforts to find a suitable site. So maybe someday, Mr. 

Green. Maybe someday. 

The chair now recognizes the gentleman from Mississippi for 5 

minutes. 

Mr. HARPER. Thank you, Mr. Chairman. 

And thanks to each of you, and for your knowledge and expertise 

on what is, overall, a very intriguing and challenging issue on how 

we go forward and what we are going to do. So thank you for your 

testimony. 

And, Mr. Cawley, and I will probably ask you, I will direct this 

toward you. When the Department of Energy instituted the nuclear 

waste fee in the 1980s, it had to account for the cost to dispose the 

spent nuclear fuel generated prior to the passage of the Nuclear 

Waste Policy Act. And certainly, as you know, they did this by providing utilities the option to pay a one-time fee upfront or defer 

payment. 

And I know, Mr. Bearden, you have discussed some of these 

issues on the structure and current value. 

Mr. Cawley, with CBO’s cash-basis scoring process, can you explain, how does CBO account for this one-time fee that is yet to be 

collected? 

Mr. CAWLEY. So the one-time fee with the current value of ap- proximately $1.6 billion is due upon delivery of the first amount of 

waste from the couple of utilities that chose that option. It hasn’t 

affected the deficits in the past. It will affect deficits in the future 

if we receive that money. We don’t really have an outlook for receiving that money, certainly in the next couple of years. 

Mr. HARPER. Gotcha. As we have heard in some of today’s testimony, when Congress appropriates funding by using the Nuclear 

Waste Fund authorization, it does not result in the overall increase 

in the amount of discretionary spending. 

Mr. Cawley, does it make a difference for CBO scoring purposes 

whether or not the appropriation from the Nuclear Waste Fund, regardless of the specific nuclear waste management activity? 

Mr. CAWLEY. I am not sure I got the question, but—— 

Mr. HARPER. Well, let me just ask this: This concept, would that 

concept apply for CBO’s scoring of activities to support consolidated 

interim storage? 

Mr. CAWLEY. If work on a consolidated interim storage were authorized, and there were appropriation out of the waste fund for 

44 

that, or out of the general fund for that, that would be scored as 

additional discretionary spending. And, again, presumably, that 

spending would come under current caps. 

Mr. SHIMKUS. Would the gentleman yield? 

Mr. HARPER. Yes. 

Mr. SHIMKUS. But the authority to spend discretionary dollars in 

an interim plan would take a change in the current law? 

Mr. CAWLEY. That is my understanding. 

Mr. SHIMKUS. OK. Thank you. 

Mr. HARPER. Mr. Cawley, therefore, is it correct that proposed 

legislation to authorize the development of a consolidated interim 

storage proposal would potentially be treated the same, whether or 

not the activities are authorized to be supported from the Nuclear 

Waste Fund? 

Mr. CAWLEY. Spending funds from the general fund versus an 

appropriation out of the Nuclear Waste Fund would both have a 

cost. 

Mr. HARPER. Mr. Kavulla, if I could ask you this: Your testimony 

calls for the establishment of an independent body to manage nuclear waste disposal. If Congress cedes its authority under the appropriations process, how can Congress maintain control over such 

an entity to assure it is fulfilling its legal obligations intended 

under the law and in the taxpayer interest? 

Mr. KAVULLA. Congressman, let me answer the question this 

way: Under the appropriations process currently, you have oversight jurisdiction over the DOE and the NRC, and your jurisdiction 

has been flouted, candidly. So I think NARUC’s recommendation is 

to establish not only oversight of whatever appropriation you escrow or give under the control of such a body, but, also, positive 

timelines and steps to that body so that you are not essentially ruling by the power of the purse through negations of agency acts, but 

directing an agency, this new independent body, to do specific 

things that are enforceable by entities, like NARUC and courts of 

law, so that no administration in the future can, again, act to drag 

its feet on this important question. 

Mr. HARPER. Thanks to each of you. My time is almost expired 

so I will yield back. 

Mr. SHIMKUS. Gentleman’s time—he actually turns the balance 

of his time. 

Seeing no other members and knowing that people have other 

places to go, we want to thank you for your time. And the record 

will be open for a couple days should other members want to submit. We would ask that you would turn those in a timely manner. 

And thank you, again, for your time. 

And with that, I will adjourn the hearing. 

[Whereupon, at 12:05p.m., the subcommittee was adjourned.] 

[Material submitted for inclusion in the record follows:] 

PREPARED STATEMENT OF HON. FRED UPTON

When President Obama took office in 2009, the national debt had just surpassed 

ten trillion dollars. Now, as we approach the final year of the Obama administration, that number will soon eclipse nineteen trillion dollars. This long-term financial 

burden will be passed along to our children and grandchildren. I was proud to be 

a partner in a bipartisan solution to reduce Medicare’s long term liability by three 

trillion dollars when Congress fixed the Medicare Sustainable Growth Rate formula. 

45 

Now, I look forward to finding a bipartisan solution to reduce skyrocketing longterm liabilities in another important policy area, our nation’s nuclear waste management policy. 

For over thirty years, ratepayers, including my constituents back in Michigan who 

rely on clean nuclear power, paid a tax on electricity generated from commercial nuclear power plants to study, license, and construct a permanent repository for spent 

fuel. When the current administration decided the Yucca Mountain project was ‘‘unworkable,’’ and illegally moved to withdraw its license application, it attempted to 

abandon a thirty-year, $15 billion investment. In 2013, the D.C. Court of Appeals 

rightly suspended the federal government’s collection of the nuclear waste fee, reasoning that the absence of a repository program meant DOE could not collect the 

tax. It is time for consumers to get what they paid for: a decision whether Yucca 

Mountain can be licensed by the Nuclear Regulatory Commission. If that decision 

is yes, the Department of Energy should proceed with construction of the facility. 

But the ratepayer’s financial support is only one aspect of the funding story. This 

spring, Secretary Moniz announced a significant departure from the bipartisan, 30- 

year nuclear waste management policy in which both defense waste and commercial 

spent nuclear fuel are jointly disposed in a permanent repository located at Yucca 

Mountain, Nevada. 

DOE is now seeking to redirect defense material, which has long been destined 

for Yucca Mountain along with commercial spent nuclear fuel. Ranking member 

Pallone and I wrote to Secretary Moniz to express our concerns about this decision. 

Central to our concerns is the potential budgetary impact of walking away from the 

scientific and technical work that was already completed, paid from our national security accounts, and starting over in a new location. The federal government has 

already spent $3.7 billion in defense funding to develop the Yucca Mountain site. 

With turmoil in the Middle East and threats on our homeland, that money would 

be better spent addressing these major and immediate national security concerns instead of grasping in the short term for a new shiny object. 

I appreciate the testimony from the experts today about budget, funding and scoring issues with a nuclear waste management program. 

PREPARED STATEMENT OF HON. FRANK PALLONE, JR. 

Thank you Mr. Chairman. Safe disposal of spent fuel from our nation’s nuclear 

reactors is an important issue in the realm of our country’s energy future. We must 

find a long term solution to the issue of nuclear waste and how to finance its safe 

storage. 

Today’s hearing focuses on the Nuclear Waste Fund and its budgetary, funding 

and scoring issues. Although the fund was intended to be ‘‘off budget,’’ appropriations from the fund have scored as expenditures and lead to insufficient funds being 

made available to meet the needs of the program. As our country pursues interim 

storage solutions—and ultimately a permanent repository for spent nuclear fuel— 

it is critical that we ensure the funds necessary to safely transport and store this 

material are available. And we must work to identify steps we can take now to set 

the stage for real reform on permanent disposal in the future, regardless of where 

the disposal facility ends up being sited. 

Whenever we have a discussion about the Nuclear Waste Fund and the safe disposal of spent nuclear fuel, it is also critical for us to consider ratepayers because 

they have paid billions of dollars into the fund and received very little in return. 

We also need to consider taxpayers who now find themselves paying for the failures 

of the program. We need to be focusing on efforts that can be enacted into law and 

that will move us forward over the next few years. 

I am very interested in hearing from our witnesses today about the challenges 

and state of play regarding the Nuclear Waste Fund and our efforts to safely store 

spent nuclear fuel. 

Thank you for holding this hearing, and I yield back the balance of my time. 

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Æ 


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