This section describes (1) IAEA’s structure and budget, (2) IAEA safeguards, (3) the nuclear fuel cycle, and (4) Iran’s nuclear program. IAEA is structured into six major programs, including Nuclear Verification, which carries out the agency’s safeguards activities. Other IAEA programs are generally intended to help promote safe and secure uses and applications of nuclear energy for civilian purposes. For example, IAEA’s Technical Cooperation program helps member states achieve their sustainable development priorities by providing relevant nuclear technologies and expertise. IAEA funds its programs primarily through (1) its regular budget, for which all member countries are assessed, and (2) voluntary extra-budgetary contributions from certain member countries and other donors to meet critical needs. IAEA’s operational budget requirements for 2016 totaled to $436.6 million, including $155.3 million for the nuclear verification program (i.e., safeguards). See table 1 for IAEA projected budget requirements for 2016 by program. IAEA has a Board of Governors, which provides overall policy direction and oversight for the agency. A Secretariat, headed by the Director General, is responsible for implementing the policies and programs of the IAEA General Conference and the Board of Governors. The State Department coordinates the United States’ financial and policy relationship with IAEA. IAEA safeguards are a set of technical measures and activities by which IAEA seeks to verify that nuclear material subject to safeguards is not diverted to nuclear weapons or other proscribed purposes. To carry out its safeguards activities, inspectors and analysts in IAEA’s Safeguards Department collaborate to verify that the quantities of nuclear material that non-nuclear weapon states have formally declared to the agency are correct and complete. Most countries have concluded a CSA with IAEA that covers all nuclear material in all peaceful nuclear activities and serves as the basis for the agency’s safeguards activities. Most countries with a CSA have also brought into force an Additional Protocol to their CSAs, which requires that country to provide IAEA with a broader range of information on the country’s nuclear and nuclear-related activities. IAEA developed the Additional Protocol to obtain additional information about and access to countries’ nuclear and nuclear-related activities as part of its response to the discovery in 1991 of a clandestine nuclear weapons program in Iraq. The Additional Protocol gives the agency’s inspectors access to an expanded range of locations, including those where the agency seeks to assure the absence of undeclared nuclear material and activities. Undeclared nuclear material and activities are those a state has not declared and placed under safeguards but is required to do so pursuant to its CSA or Additional Protocol. Iran’s CSA entered into force in May 1974. According to IAEA officials, Iran applied the Additional Protocol beginning in December 2003, ceased to do so in February 2006, and has been provisionally applying it since January 16, 2016. IAEA regards Iran’s provisional application as if the Additional Protocol were in force. IAEA implements safeguards through a range of activities and techniques to help ensure that all nuclear material is where it was declared to be and to verify that there was no misuse of the facility, no diversion of declared nuclear material, and no undeclared nuclear material or activities. Safeguards activities include on-site inspections, environmental sampling, and remote monitoring. For example, to verify nondiversion of nuclear material, IAEA inspectors count items (e.g., containers of uranium or plutonium), measure attributes of these items (e.g., isotopic composition), and compare their findings with records and declared amounts. Inspectors typically verify the nuclear material inventory by reviewing a facility’s nuclear material accounting documentation (e.g., reports and records) and through, for example, visual observation, radiation detection and measurement, and application of seals and other identifying and tamper-indicating devices, according to IAEA documents. Visual observation allows inspectors to observe the processes within a location and the equipment it contains, and to check the consistency of observations with declarations. Inspection activities are supported by off- site safeguards activities, such as analysis of the environmental samples collected during inspections, remote monitoring through the equipment installed, analysis of commercial satellite imagery, and analysis of open source documents, such as technical journals. IAEA may conduct three types of inspections pursuant to comprehensive safeguards agreements: ad hoc, routine, and special inspections. For example, IAEA may conduct ad hoc inspections to verify a state’s initial declaration under the CSA and any changes to these declarations. Routine inspections give IAEA access to strategic points at a location to verify, among other things, the location, identity, quantity, and composition of all nuclear material subject to safeguards under the CSA. Notification of inspections can be transmitted from 1 week to 24 hours in advance or less. Routine inspections may also be unannounced. IAEA may also conduct special inspections in certain circumstances, either in addition to the routine or ad hoc inspection effort or involving access to locations or information beyond those subject to a routine or ad hoc inspection. The Additional Protocol also authorizes “complementary access” for IAEA, which is access to nuclear sites and other locations related to a state’s nuclear fuel cycle—beyond declared nuclear facilities that are routinely subject to inspections under the CSA— including locations at which nuclear fuel-cycle research and development not involving nuclear material is carried out; manufacturing and import locations; and all buildings on a nuclear site, including undeclared locations. IAEA may also negotiate “managed access” with a state to prevent the dissemination of proliferation-sensitive information, meet safety or physical protection requirements, or protect proprietary or commercially sensitive information. According to an IAEA document, an example of managed access is the designation by the operator, based on arrangements made with IAEA, of the routes to be followed on a site to prevent the exposure of inspectors to high levels of radiation or to protect proprietary sensitive information associated with certain equipment. Furthermore, managed access should not hinder IAEA inspectors or prevent them from fulfilling the purposes of the complementary access— that is, the arrangements shall not preclude the agency from conducting activities necessary to provide credible assurance of the absence of undeclared nuclear material and activities at the location in question. IAEA plans inspections according to its reporting requirements and its goals for timely detection. The safeguards agreements with a given country, its nuclear materials, and the nature of its fuel cycle and facilities to be safeguarded inform the frequency of inspections and other in-field activities. For example, according to IAEA documents, in countries without an Additional Protocol in force or where IAEA has not drawn a broader conclusion, IAEA’s inspections would be timed to detect the diversion of unirradiated direct use material—nuclear material that can be used for the manufacture of nuclear explosive devices in its present form—within 1 month. The goal for irradiated direct use material, such as spent fuel, which would require more time and effort to be converted to components of nuclear explosive devices, would be to detect any diversion in 3 months. The goal for all other nuclear material, such as depleted, natural, and low-enriched uranium, as well as thorium, would be to detect any diversion in a year. IAEA plans its supporting safeguards activities—such as analysis of satellite imagery before inspections, of Additional Protocol declarations, and of information obtained during inspections (such as environmental samples)—in proportion to the frequency of inspections. )—timeliness would be several months for tens of kilograms of material. efficient at producing plutonium under certain circumstances; the operating power, among other things, influences how much plutonium is produced. The fuel cycle—the series of processes used to make fuel for and manage spent fuel from nuclear reactors—may also be used to produce special nuclear material for weapons. The uranium nuclear fuel cycle consists of three stages: (1) the front end, in which uranium is mined, milled, enriched, and fabricated into fuel; (2) reactor operation; and (3) the back end, in which spent fuel is either disposed of (open fuel cycles) or processed to produce new fuel (closed or partially closed fuel cycles). IAEA verifies that nuclear material subject to safeguards is not diverted. Under a CSA, the starting point of safeguards is when nuclear material reaches the stage in the nuclear fuel cycle where it is suitable, by composition and purity, for enrichment or fuel fabrication and leaves the plant or the process stage by which it has been produced, or when material that has not yet reached such a stage is imported into the state or exported to a non-nuclear weapon state. See figure 1 for an illustration of the nuclear fuel cycle. Iran’s nuclear program includes two uranium mines and mills—the Gchine uranium mine and mill, the Saghand mine, and the Ardakan mill. Iran operates a conversion facility and fuel fabrication plant in Esfahan, the Tehran Research Reactor, and the Bushehr Nuclear Power Plant. Iran’s nuclear program also includes the Arak/IR-40 heavy water reactor, enrichment facilities at Natanz and Fordow, and a heavy water production plant in Arak. See figure 2 for a map of major facilities in Iran’s nuclear program. Iran had previously failed to declare some of these facilities to IAEA. For example, in 2002, IAEA was informed by member states of previously undeclared nuclear facilities—a uranium enrichment plant in Natanz and a heavy water production plant in Arak.