Court Opinion

ID: 2963568
Source: CourtListenerOpinion
Date Created: 2015-09-21 21:12:09.887954+00
Date Added: 2024-06-11T11:42:42.432051
License: Public Domain

USCA1 Opinion

	

                            UNITED STATES COURT OF APPEALS
                                FOR THE FIRST CIRCUIT
                                 ____________________

          No. 94-1562

                          CITIZENS AWARENESS NETWORK, INC.,
                                     Petitioner,

                                          v.

                     UNITED STATES NUCLEAR REGULATORY COMMISSION,
                                     Respondent.

                                 ____________________

                           YANKEE ATOMIC ELECTRIC COMPANY,
                                     Intervenor.

                                 ____________________

                     ON PETITION FOR REVIEW OF A DECISION OF THE 
                     UNITED STATES NUCLEAR REGULATORY COMMISSION

                                 ____________________

                                        Before

                               Torruella, Chief Judge,
                                          ___________
                            Aldrich, Senior Circuit Judge,
                                     ____________________
                               and Cyr, Circuit Judge.
                                        _____________

                                _____________________

               Jonathan  M. Block,  with  whom Robert  L.  Quinn and  Egan,
               __________________              _________________      _____
          Flanagan and Cohen, P.C. were on brief for petitioner.
          ________________________
               Charles E. Mullins,  Senior Attorney, Office of  the General
               __________________
          Counsel, U.S. Nuclear  Regulatory Commission, with whom  Karen D.
                                                                   ________
          Cyr,  General Counsel,  John F.  Cordes, Jr.,  Solicitor,  E. Leo
          ___                     ____________________               ______
          Slaggie, Deputy  Solicitor, U.S.  Nuclear Regulatory  Commission,
          _______
          Anne S.  Almy, Assistant Chief, and William B. Lazarus, Attorney,
          _____________                       __________________
          Appellate Section,  Environment and  Natural Resources  Division,
          U.S. Department of Justice, were on brief for respondent.
               Thomas G. Dignan, Jr.,  with whom Ropes & Gray, was on brief
               _____________________             ____________
          for intervenor.

                                 ____________________

                                    July 20, 1995
                                 ____________________

                    TORRUELLA,  Chief Judge.    Citizens Awareness  Network
                    TORRUELLA,  Chief Judge
                    _______________________

          ("CAN") petitions for review of a  final order and opinion of the

          United  States  Nuclear  Regulatory  Commission  ("NRC"  or  "the

          Commission") denying CAN's  request for  an adjudicatory  hearing

          regarding  decommissioning activities taking  place at the Yankee

          Nuclear Power Station ("Yankee NPS").   CAN's petition for review

          rests   on  three  grounds.     First,  CAN   contends  that  the

          Commission's order  violates CAN  members' right  to due  process

          under the  Fifth Amendment and    189a of  the Atomic Energy  Act

          ("AEA"), 42  U.S.C.   2239 (1988).   Second, CAN argues  that the

          NRC's  action  violates the  National  Environmental  Policy Act,

          ("NEPA"), 42 U.S.C.   4321  et seq. (1988) by failing  to conduct
                                      __ ___

          an  environmental  analysis  ("EA")  or  an  environmental impact

          statement  ("EIS") prior to decommissioning.  Finally, CAN argues

          that  the Commission's  actions violate  its  own precedents  and

          regulations,  in violation  of the  Administrative Procedure  Act

          ("APA"), 5 U.S.C.   501 et  seq.  Although we reject CAN's  Fifth
                                  __  ___

          Amendment arguments, we  grant CAN's petition  for review on  the

          other grounds stated.

                                      BACKGROUND
                                      BACKGROUND

                    A.   The Regulatory Framework
                    A.   The Regulatory Framework
                         ________________________

                    Operators of nuclear  power plants must have  a license

          issued by the NRC.   That license describes the facility  and the

          authorized  activities  that the  operator may  conduct.   If the

          operator, called the "licensee," wishes to modify the facility or

          take  actions not  specifically authorized  by  the license,  the

                                         -2-

          licensee  may  seek   an  amendment  to  its   license  from  the

          Commission.  See 42 U.S.C.    2131-2133, 2237 (1988).
                       ___

                    Section 189a of the AEA provides that:

                      In any proceeding under this chapter, for
                      the  granting,  suspending,  revoking, or
                      amending of  any license  or construction
                      permit,   or   application   to  transfer
                      control, and  in any  proceeding for  the
                      issuance  or  modification of  rules  and
                      regulations dealing  with the  activities
                      of licensees, . . .  the Commission shall
                      grant a hearing upon  the request of  any
                      person whose interest  may be affected by
                      the proceeding, and shall  admit any such
                      person    as    a     party    to    such
                      proceeding. . . .

          42 U.S.C.   2239(a)(1)(A).  The Commission has issued regulations

          specifically allowing a licensee to modify its facilities without

          NRC supervision, unless the modification is inconsistent with the

          license or involves an  "unreviewed safety question."  10  C.F.R.

            50.59(a)(1).  If the  proposed change is inconsistent  with the

          license, or does  involve an unreviewed safety question  (as that

          term is  defined in  10 C.F.R.    50.59(a)(2)(ii)),  the licensee

          must apply to  the Commission for a license  amendment, 10 C.F.R.

            50.59(c), and  only then  are the  statutory hearing  rights of

            189a triggered.

                    The  procedures  for decommissioning1  a  nuclear power

          plant are  set forth  principally in 10  C.F.R.     50.82, 50.75,

          51.53,  and 51.95  (1990).   The formal  process begins  with the
                              
          ____________________

          1   "Decommissioning" means those activities necessary "to remove
          [a   facility]   safely   from   service  and   reduce   residual
          radioactivity to a level that permits release of the property for
          unrestricted use  and termination of  the license."  10  C.F.R.  
          50.2; 53 Fed. Reg. 24018, 24021 (June 27, 1988).  

                                         -3-

          filing  of an  application by  the licensee,  normally after  the

          plant has ceased permanent operations, for authority to surrender

          its license and to decommission  the facility.  Five years before

          the licensee expects to end  plant operations, the licensee  must

          submit  a  preliminary  decommissioning  plan  containing a  cost

          estimate  for  decommissioning  and an  assessment  of  the major

          technical factors that could affect planning for decommissioning.

          10 C.F.R.    50.75.  Within two years  after "permanent cessation

          of operations" at the plant, but no  later than one year prior to

          expiration  of  its  license,  a  licensee  must  submit  to  the

          Commission an application  for "authority to surrender  a license

          voluntarily and to  decommission the facility," together  with an

          environmental  report   covering  the   proposed  decommissioning

          activities.  10 C.F.R.     50.82, 50.83. This application must be

          accompanied  by  the  licensee's  proposed decommissioning  plan,

          which  describes  the  decommissioning   method  chosen  and  the

          activities involved, and sets forth a financial plan for assuring

          the availability of adequate funds for the decommissioning costs.

          10  C.F.R.      50.82(b).    The  Commission   then  reviews  the

          decommissioning  plan, prepares  either  an environmental  impact

          statement  ("EIS")  or  an  environmental  assessment  ("EA")  in

          compliance with NEPA, and gives notice to interested parties.  10

          C.F.R.   51.95.  If the NRC finds the plan satisfactory (i.e., in
                                                                   ____

          accordance  with regulations  and  not  inimical  to  the  common

          defense or the  health and safety of the  public), the Commission

                                         -4-

          issues a decommissioning order approving the plan and authorizing

          decommissioning.  10 C.F.R.   50.82(e).

                    The  Commission has stated that its regulations allow a

          licensee to  conduct certain, limited  decommissioning activities

          prior to obtaining NRC approval:

                      [I]t  should  be noted  that  [10 C.F.R.]
                        50.59 permits a holder of an  operating
                                        _______________________
                      license to  carry out  certain activities
                      _______
                      without prior Commission  approval unless
                      these activities involve a change in  the
                      technical specifications or an unreviewed
                      safety question.  However,  when there is
                      a change in  the technical specifications
                      or an unreviewed safety question,   50.59
                      requires  the  holder   of  an  operating
                      license  to  submit  an  application  for
                      amendment  to  the  license  pursuant  to
                        50.90 . . . . [T]his  rulemaking do[es]
                      not  alter  a  licensee's  capability  to
                      conduct   activities   under       50.59.
                      Although the Commission  must approve the
                      _________________________________________
                      decommissioning  alternative   and  major
                      _________________________________________
                      structural    changes   to    radioactive
                      _________________________________________
                      components of the facility or other major
                      _________________________________________
                      changes,  the licensee  may proceed  with
                      _______
                      some activities such  as decontamination,
                      minor component disassembly, and shipment
                      and  storage  of  spent  fuel  if   these
                                                     __________
                      activities are permitted by the operating
                      _________________________________________
                      license and/or   50.59.
                      _______

          53 Fed.  Reg. at  24025-24026 (emphasis  added).   The Commission

          adhered to this  position from the issuance of  this statement in

          1988 until 1993.  See, e.g.,  Long Island Lighting Co., 33 N.R.C.
                            ___  ____   ________________________

          at  73  n.5   ("Major  dismantling  and  other   activities  that

          constitute decommissioning under the NRC's regulations must await

          NRC approval of  a decommissioning plan"); Sacramento  Mun. Util.
                                                     ______________________

          Dist.  (Rancho Seco Nuclear Generating Station), 35 N.R.C. 47, 62
          _______________________________________________

          n.7 (1992) (same).

                                         -5-

                    B.   Factual Background
                    B.   Factual Background
                         __________________

                    On February  27, 1992, licensee Yankee  Atomic Electric

          Company  ("YAEC") announced  its  intention  to cease  operations

          permanently  at Yankee NPS,  a nuclear  power plant  located near

          Rowe, Massachusetts.  One month later, YAEC applied for a license

          amendment  to  limit  its license  to  a  POL, a  possession-only

          license, thus  revoking YAEC's  authority to  operate the  plant.

          The  NRC published  a  Notice of  Proposed  Action informing  the

          public of  its opportunity to  be heard on the  license amendment

          request, pursuant  to    189a of the  AEA.   57 Fed.  Reg. 13126,

          13140  (April  15,  1992).    There  were  no  hearing  requests;

          accordingly, the  NRC issued  the requested  amendment to  YAEC's

          license on  August 5, 1992.  57 Fed.  Reg. 37558, 37579 (Aug. 19,

          1992).   In the cover letter accompanying YAEC's amended license,

          the Commission reminded YAEC that "[t]he  NRC must approve . .  .

          major  structural  changes  to   radioactive  components  of  the

          facility . . . ."   See Issuance of Amendment No.  __ to Facility
                              ___

          Operating License No. DPR-3 (N.R.C. Docket No. 50-029).

                    At  a meeting between  YAEC and NRC  representatives on

          October 27, 1992, YAEC proposed that the NRC grant permission for

          YAEC  to initiate  an  "early  component  removal  project"  (the

          "CRP"), prior to  submission and approval of  its decommissioning
                  _____

          plan, and hence  prior to conducting an  environmental assessment

          of decommissioning  at the site.   YAEC explained that  it wished

          expeditious  commencement  of  this  early  CRP  because  of  the

          unexpected  availability of space in the Barnwell, South Carolina

                                         -6-

          Low-level  Waste  Disposal  facility.     If  made  to  wait  for

          submission and  approval of  a decommissioning  plan, YAEC  would

          lose its chance to use the Barnwell facility.

                    Pursuant  to this proposed CRP, YAEC would first remove

          the four  steam generators and  the pressurizer from  the nuclear

          reactor  containment,  remove  core  internals  from  the reactor

          pressure   vessel,  and   transport  all  of   these  radioactive

          components to  the Barnwell  facility.   After this  dismantling,

          YAEC  proposed to  then cut  up the  nuclear reactor  core baffle

          plate (which is too radioactive  to meet low-level waste criteria

          and thus  cannot be dumped  in the Barnwell site),  and store the

          pieces in canisters in the spent fuel pool for future delivery to

          a U.S. Department of Energy waste site.  Finally, YAEC planned to

          remove and transport the four  main coolant pumps to the Barnwell

          site.    These  CRP  activities  would result  in  the  permanent

          disposal  of 90% of the nonfuel, residual radioactivity at Yankee

          NPS, all prior to approval of the actual decommissioning plan.
                   _____

                    On November  25, 1992,  YAEC sent a  letter to  the NRC

          which  set forth  YAEC's  arguments as  to  how NRC  regulations,

          Statements of  Consideration issued with  those regulations,  and

          Commission precedents could be "interpreted" to allow approval of

          the  early   CRP,  despite   the  fact   that  the   Commission's

          interpretative  policy  at  that  time  explicitly  required  NRC

          approval for major structural changes.

                    During this period,  CAN also wrote two letters  to the

          NRC,  on  November  2,  1992  and again  on  December  21,  1992,

                                         -7-

          requesting inter  alia that the  Commission halt or  postpone any
                     _____  ____

          and   all  dismantling   activities  at   Yankee   NPS  until   a

          decommissioning  plan was  submitted,  moved  through the  public

          notice-and-comment process, and approved.  In a December 29, 1992

          letter  to CAN,  Kenneth  Rogers,  the  Acting  Chairman  of  the

          Commission,  responded that  the  Commission was  "considering  a

          public meeting  in the  vicinity of  the plant  early in 1993  to

          provide   information  to   the  public   on   NRC's  review   of

          decommissioning  in general and on expected site activities which

          will occur prior to the licensee's submittal of a decommissioning

          plan in late 1993."

                    On January 14,  1993, following internal review  of its

          decommissioning   policies,  the   Commission   issued  a   Staff

          Requirements   Memo  ("SRM"),   setting   forth  a   significant,

          substantial  change from  previously  held  agency  positions  on

          decommissioning  activities,  and   essentially  adopting  YAEC's

          proposed  "interpretation"   of  prior   agency  precedents   and

          positions.    Without   any  explanation   for  the   substantial

          modification, or any further analysis, the SRM stated:

                      Notwithstanding      the     Commission's
                      _______________
                      statements  in  footnote 3  of  CLI-90-08
                      [Long Island Lighting  Co., 33 N.R.C.  61
                       _________________________
                      (1991)]    and    the    Statements    of
                      Consideration  for   the  decommissioning
                      rules  at 53  Federal Register  24025-26,
                      licensees should be  allowed to undertake
                      any decommissioning activity (as the term
                      "decommission"  is defined  in 10  C.F.R.
                      50.2)  that does not -- (a) foreclose the
                      release   of   the  site   for   possible
                      unrestricted   use,   (b)   significantly
                      increase decommissioning costs, (c) cause
                      any significant environmental  impact not

                                         -8-

                      previously reviewed,  or (d)  violate the
                      terms of the  licensee's existing license
                      (e.g.,  OL,  POL,  OL  with  confirmatory
                      shutdown order  etc.) or 10  C.F.R. 50.59
                      as applied to the existing license. . . .
                      The  staff may  permit  licensees to  use
                      their  decommissioning   funds  for   the
                      decommissioning    activities   permitted
                      above  . .  .,  notwithstanding the  fact
                                      _________________________
                      that their decommissioning plans have not
                      _________________________________________
                      yet been approved by the NRC.
                      ____________________________

          Shortly  after the Commission  issued this SRM,  YAEC advised the

          NRC that  it planned  to begin its  CRP activities  in accordance

          with this new policy.2

                    On June  30, 1993,  the Commission  issued another  SRM

          reiterating its new  decommissioning policy, and stating  that it

          had voted to formally amend 10 C.F.R.   50.59 to reflect this new

          position.   This  proposed rulemaking  is  still underway.    The

          Commission also stated that approval of a decommissioning plan is

          not an action  that triggers hearing rights  under   189a  of the

          AEA,  but that  the Commission  staff  could, in  its discretion,

          formulate an  informal hearing  process for  decommissioning plan

          approval.

                    On September 8, 1993, CAN again wrote to the NRC, again

          requesting  a  hearing  on the  CRP  at  Yankee  NPS.   CAN  also

          generally  alleged that  the  NRC  was in  violation  of its  own

          regulations,  and in violation  of "the rule  making process," by

          allowing a licensee  to engage in a CRP  without prior Commission
                              
          ____________________

          2    Later,  YAEC  submitted  a  decommissioning  plan, which  is
          currently  under NRC  review.   YAEC  completed most  of the  CRP
          activities, however, before it ever submitted its decommissioning
          plan  to  the  Commission,  and  well  before  any  environmental
          assessment was performed.

                                         -9-

          approval.   The Commission  responded to  these allegations  in a

          letter dated November  18, 1993, stating that CAN  had "failed to

          identify the proposed action that might be taken by the NRC Staff

          that requires the offer of a hearing."

                    The next  day, CAN filed  a petition for  agency review

          under 10 C.F.R.    2.206,3 requesting that  the NRC halt the  CRP

          activities  pending an  investigation by the  Inspector General's

          office.   In the petition,  CAN reiterated its position  that the

          CRP  constitutes decommissioning,  and that the  NRC was  thus in

          violation of  its own regulations  in allowing CRP  activities at

          Yankee NPS prior to approval of a decommissioning plan.   The NRC

          responded  by  letter  dated December  29,  1993,  explaining its

          policy change as set forth in the SRMs, and concluding that CAN's

          petition  "does not  provide any  new  information regarding  why

          public  health  and safety  warrants  suspension of  the  CRP and

          therefore does not meet the  threshold for treatment under 10 CFR

          2.206."

                    After  a flurry  of letters,  in  which CAN  repeatedly

          requested  formal  hearings   on  the  CRP  and   the  Commission

          consistently denied  these requests on  the grounds that  the CRP

          was inaccord withthe newpolicy, CANfiled thispetition forreview.4
                              
          ____________________

          3  Under  10 C.F.R.    2.206, members of  the public may  request
          agency enforcement action against a licensee that is allegedly in
          violation of an NRC regulation or requirement.

          4   In April 1993,  CAN also filed a  motion in the United States
          District  Court for  the  District  of  Massachusetts  seeking  a
          temporary  restraining order  to halt  the CRP  activities.   The
          district court  dismissed the action  for lack of  subject matter
          jurisdiction.   Citizens Awareness  Network v. NRC,  854 F. Supp.
                          ___________________________    ___

                                         -10-

                                  STANDARD OF REVIEW
                                  STANDARD OF REVIEW

                    We review agency actions and decisions with substantial

          deference, setting  them aside  only if  found to be  "arbitrary,

          capricious,  an  abuse   of  discretion,  or  otherwise   not  in

          accordance with  the law."   5 U.S.C.   706(2)(A);  Motor Vehicle
                                                              _____________

                              
          ____________________

          16,  18-19 (1994).   In  so  doing, however,  the district  court
          wrote:

                      The  court  makes  this decision  with  a
                      heavy heart.   The  plaintiffs have  been
                      diligently attempting for months to get a
                      hearing   on   the   appropriateness  and
                      competence of the NRC's actions.  Many of
                      them  live   near   the   site   of   the
                      decommissioned nuclear  plant.   They and
                      their families are  the most directly  at
                      risk if the job of removing  contaminated
                      materials is bungled. . . . Not only have
                      the    plaintiffs    been    denied   the
                      opportunity to present their concerns and
                      to  hear the  response of  the  NRC at  a
                      formal hearing, they have not as yet even
                      been  afforded a forum  in which to argue
                      their entitlement to a hearing.  They had
                            ___________
                      no incentive  to seek a  hearing when the
                      NRC originally issued the POL, because at
                      that time it was the policy of the NRC to
                                   ___
                      require   final    approval   and    NEPA
                      compliance   before   authorizing   early
                      component removal.  Months later, the NRC
                      now concedes, this policy changed and the
                      NRC  decided to  view  the POL  as itself
                      authorizing   early   component   removal
                      without more.   Requests  for hearing  at
                      this point were denied. . . . This course
                      of   conduct    suggests   a    concerted
                      bureaucratic effort to thwart the efforts
                      of local  citizens to  be heard  about an
                      event that vitally affects them and their
                      children. .  . .  The prospect  that this
                      tactic may  be used  nationally, as  more
                      nuclear  plants shut down,  . . .  is, to
                      put it mildly, disquieting.

          Id. at 19 (emphasis in original).
          __

                                         -11-

          Mfrs. Ass'n v. State Farm Mut. Ins. Co., 463 U.S. 29,  41 (1983).
          ___________    ________________________

          The scope of this review is narrow; a court should not substitute

          its judgment for that of the agency, and agency decisions will be

          upheld so long as they "'do not collide directly with substantive

          statutory commands and so long as procedural corners are squarely

          turned.'" Adams v.  EPA, 38 F.3d 43, 49  (1st Cir. 1994) (quoting
                    _____     ___

          Puerto Rico  Sun Oil Co. v. EPA, 8 F.3d  73, 77 (1st Cir. 1993)).
          ________________________    ___

          This  deference is especially  marked in technical  or scientific

          matters within the  agency's area of expertise.  Id.
                                                           __

                    While  this is a highly deferential standard of review,

          it is  not  a  rubber  stamp; in  order  to  avoid  being  deemed

          arbitrary  and capricious, an  agency decision must  be rational.

          Id.; Puerto Rico  Sun Oil Co., 8  F.3d at 77.   Moreover, when an
          __   ________________________

          administrative  agency   departs  significantly   from  its   own

          precedent, "it must confront  the issue squarely and  explain why

          the departure is reasonable."  D vila-Bardales v. INS, 27 F.3d 1,
                                         _______________    ___

          5 (1st Cir. 1994).  This is not to say that agencies must forever

          adhere to their precedents; agencies may "refine, reformulate and

          even reverse  their precedents in  the light of new  insights and

          changed circumstances."  Id.  See also Rust v. Sullivan, 500 U.S.
                                   __   ________ ____    ________

          173, 186-87 (1991).  An agency changing its course must, however,

          supply a reasoned  analysis for the change.   Motor Vehicle Mfrs.
                                                        ___________________

          Ass'n,  463 U.S. at 42;  Puerto Rico Sun  Oil Co., 8  F.3d at 77.
          _____                    ________________________

          With these  principles in mind,  we turn  to the merits  of CAN's

          petition.

                                       ANALYSIS
                                       ANALYSIS

                                         -12-

                    CAN  raises three  principal  arguments.    First,  CAN

          contends that  the NRC's  refusal to grant  CAN a  formal hearing

          before  allowing YAEC  to conduct  decommissioning constitutes  a

          regulatory  taking of  their  property  without  due  process  or

          compensation, denies CAN members their right to due process under

          the Fifth  Amendment, and  violates the  hearing requirements  of

            189a of the AEA.   Second, CAN argues  that the Commission  has

          violated NEPA  by allowing YAEC  to accomplish almost 90%  of its

          decommissioning  activities before  conducting any  environmental

          assessment.   Finally, CAN  contends that  the NRC's  unexplained

          change  in its decommissioning policy was irrational and contrary

          to  its own  duly-promulgated regulations,  in  violation of  the

          procedural requirements of the APA.  We address these contentions

          in reverse order.

                    A.   The NRC's Change In Policy
                    A.   The NRC's Change In Policy
                         __________________________

                    CAN  argues that  the  Commission's significant  policy

          shift, manifested in its two Staff Requirements Memos, improperly

          revoked duly-promulgated Commission  regulations, interpretations

          and precedents, without  the benefit of rulemaking  procedures or

          even  a rational explanation for the change.  By allowing YAEC to

          commence  the CRP  activities notwithstanding its  own precedents

          and regulations, CAN contends,  the Commission acted  arbitrarily

          and  capriciously, in  violation of the  APA.  In  defense of the

          unexplained  change  in  its   decommissioning  policy,  the  NRC

          maintains that the former policy had never been incorporated into

                                         -13-

          the regulations themselves,  and, in any case,  that agencies are

          free to alter their interpretations of their own regulations.5

                    While  this is certainly  true, any such  alteration or

          reversal must be accompanied by some reasoning -- some indication

          that  the shift  is  rational, and  therefore  not arbitrary  and

          capricious.   Puerto Rico Sun Oil Co., 8 F.3d at 77-78.  See also
                        _______________________                    ________

          Atchison, Topeka & Santa Fe Ry. Co. v. Wichita Bd. of  Trade, 412
          ___________________________________    _____________________

          U.S.  800, 808  (1973)("Whatever the  ground  for the  [agency's]

          departure from prior norms, . . . it must be clearly set forth so

          that the reviewing court may understand the basis of the agency's

          action.").  Courts should not  attempt to supply a reasoned basis

          for  the action  that the  agency itself  has  not given.   Motor
                                                                      _____

          Vehicle Mfrs.  Ass'n,  463 U.S.  at  43.   While  this is  not  a
          ____________________

          difficult standard to meet, the Commission has not met it here.

                    The prior Commission  policy regarding decommissioning,

          embodied in 10 C.F.R.    50.59 and explicated in the Commission's

          published  Statement of Consideration, required NRC approval of a

          decommissioning  plan  before  a  licensee  undertook  any  major

          structural  changes to  a facility.   This  policy was  developed

          through a  lengthy notice  and comment  period, with  substantial

          public participation.  See 53 Fed.  Reg. 24018, 24020 (a total of
                                 ___

                              
          ____________________

          5  We are baffled by the Commission's assertion that "CAN has not
          challenged this  modification of NRC  policy," as we  count three
          pages of argument  in CAN's brief devoted to  this precise issue.
          Nor  can the Commission  claim that CAN did  not raise this issue
          prior to filing this petition for review.  In both  its September
          8, 1993 letter to the NRC and its 2.206 enforcement petition, CAN
          alleged  that  the  Commission  was   in  violation  of  its  own
          regulations and of the "rule making process."  

                                         -14-

          143 individuals  and organizations submitted comments on proposed

          rule).   The Commission  adhered to this  policy for  almost five

          years,  reiterating its  position in  at  least two  adjudicatory

          decisions.   Then, rather suddenly, the Commission circulated two

          internal  staff  memos  that  completely  reversed  this  settled

          policy,  without  any  notice  to  the  affected  public.    More

          troubling,  however, was the  Commission's failure to  provide in

          those memos,  or anywhere  else, any  justification or  reasoning

          whatsoever for the change.   The memos did not set  forth any new

          facts, fresh  information, or  changed circumstances  which would

          counsel the  shift.  Nor  did they provide any  legal analysis of

          how the new policy comported  with, or at least did  not conflict

          with, existing  agency  regulations.   With nothing  more than  a

          breezy  "notwithstanding," the  Commission  abruptly disposed  of

          five  years'  worth  of  well-reasoned,  duly-promulgated  agency

          precedent.

                    Moreover, the  NRC's actions are inconsistent  with the

          plain terms of the AEA, the NRC's enabling statute, which provide

          that "in any proceeding for the issuance or modification of rules
                                                      ____________

          and regulations dealing  with the activities of licensees,  . . .

          the  Commission shall  grant a  hearing upon  the request  of any

          person  whose interest may be affected  by the proceeding. . . ."

          42 U.S.C.    2239(a)(1)(A)  (emphasis added).    While the  NRC's

          policy  shift involved an  interpretation of its  regulation, and

          not the regulation  itself, it was an interpretative  policy that

          provided  a great  deal  of substantive  guidance  on the  rather

                                         -15-

          ambiguous language of the regulation, by specifically delineating

          the  permissible activities  of  licensees.   We  think that  the

          statute's  phrase   "modification  of   rules  and   regulations"

          encompasses  substantive interpretative  policy changes  like the

          one  involved  here,  and therefore  that  the  Commission cannot

          effect such  modifications without complying  with the  statute's

          notice  and hearing provisions.   See Natural  Resources, Etc. v.
                                            ___ ________________________

          NRC, 695 F.2d 623, 625  (D.C. Cir. 1982)("Fair notice to affected
          ___

          parties requires  that the Commission not alter  suddenly and sub
                                                                        ___

          silentio settled interpretations of its own regulations.").6
          ________

                    Finally,  we  agree  with  the   petitioners  that  the

          Commission's new policy  appears utterly irrational on  its face.
                                                   __________

          By  allowing  licensees to  conduct  most,  if  not all,  of  the

          permanent  removal and  shipment  of  the  major  structures  and

          radioactive components  before the submittal of a decommissioning

          plan,  it appears  that the  Commission  is rendering  the entire

          decommissioning plan  approval process  nugatory.   Why should  a

          licensee be required to submit such a plan if its decommissioning

          is  already irreversibly  underway?   Why  offer  the public  the

          opportunity to be heard on a proposed decommissioning plan if the

          actual  decommissioning  activities are  already  completed?   In
                              
          ____________________

          6   The Commission points out that in  June 1993 it held a public
          meeting, attended by several  CAN members.  Although the  meeting
          was ostensibly  to address  the community's  questions about  the
          decommissioning activities at  Yankee NPS, the transcript  of the
          meeting  indicates   that  the   NRC  representatives   carefully
          sidestepped the few  questions raised about the recent  change in
          Commission policy  regarding decommissioning.   We  do not  think
          that  this  type  of  forum   or  proceeding  meets  the  hearing
          requirements of the AEA.

                                         -16-

          short,  the Commission's  new  decommissioning  policy  seems  to

          render any  regulatory oversight  of the  decommissioning process

          moot.  Perhaps  a rational basis  for this policy exists,  but we

          cannot see one, and the Commission has not provided one.

                    The Commission's failure to provide any explanation for

          its seemingly irrational change in policy  renders its new policy

          arbitrary   and  capricious,  and  not  in  accordance  with  the

          requirements of 42  U.S.C.   2239(a)(1)(A).   We therefore remand

          the  issue  of the  NRC's  change in  decommissioning  policy for

          further  proceedings,  in  accordance   with  the  AEA's  hearing

          requirements and this opinion.

                    B.   Petitioner's NEPA Arguments
                    B.   Petitioner's NEPA Arguments
                         ___________________________

                    CAN  also  contends  that the  Commission's  irrational

          interpretation  of  its  regulations  has  led  to  the  agency's

          permitting YAEC  to accomplish  over 90%  of the  decommissioning

          activities at Yankee  NPS prior to conducting  any EA or EIS,  in

          violation  of  NEPA,  42  U.S.C.     4332.7    In  response,  the

                              
          ____________________

          7   The National  Environmental Policy Act,  42 U.S.C.    4321 et
                                                                         __
          seq.,  requires all  federal  agencies,  including  the  NRC,  to
          ___
          prepare    a   "detailed    statement,"   containing    specified
          environmental  information,  for   all  proposed  "major  federal
          actions  significantly  affecting   the  quality  of   the  human
          environment."  42  U.S.C.   4332 (2)(C).   When the NRC plans  to
          issue a license  amendment or take some other  form of regulatory
          action that requires NEPA compliance, the NRC will publish either
          an  EA  stating  that  there  is no  significant  impact  on  the
          environment from  the proposed action,  or an EIS,  reviewing the
          impact  of  the proposed  action  and listing  alternatives.   10
          C.F.R.    51.20,  51.21.  When approving a  licensee's request to
          decommission,  the NRC prepares either a supplemental EIS for the
          post-operating  license  stage,  or  an  EA  updating  the  prior
          environmental review for  the facility, as it  deems appropriate.
          10 C.F.R.   51.95(b).

                                         -17-

          Commission claims  that the  CRP activities  do not  constitute a

          "major  federal   action"  triggering   NEPA  compliance.     The

          Commission  explains  that it  did  not actively  permit  YAEC to

          initiate  CRP  activities;  rather,  it "simply  reviewed  YAEC's

          implementation of the CRP, as a part of its everyday oversight of

          its licensee's activities, and found no reasons to interfere with

          YAEC's plans."  Because mere "regulatory oversight, as opposed to

          active permission, does  not implicate NEPA," the  NRC argues, no

          EA or EIS was required.

                    This  argument is completely  devoid of merit.   First,

          the  Commission  holds  in  trust  certain  funds  set  aside  by

          licensees, including YAEC, to finance decommissioning activities.

          42 U.S.C.   2232(a).  The Commission therefore had to approve the

          release of these  set-aside funds in order to  finance YAEC's CRP

          activities.      See   Letter  from   Morton   B.   Fairtile  re:
                           ___

          Decommissioning Funds, N.R.C. Docket No. 50-029 (April 16, 1993).

          In essence, the Commission had  to actively permit the release of
                                             _______________

          funds, or YAEC could not have initiated  the CRP.  Far from being

          "mere oversight," we think the Commission's approval of financing

          certainly constitutes its active permission of the CRP.   Second,

          it is undisputed  that decommissioning is  an action which,  even

          under the Commission's new policy, requires NEPA  compliance.  10

          C.F.R.    51.95(b).   In "advising"  YAEC that it  could initiate

          decommissioning prior  to submitting a decommissioning  plan, the

          NRC effectively granted  YAEC permission  to commence  activities

          normally conducted after decommissioning plan approval, including
                             _____

                                         -18-

          the  removal  and  storage  of  almost  all  of  the  radioactive

          components.     This  permission,   in  turn,  allowed   YAEC  to

          decommission  its facility without the benefit of NEPA compliance

          by the Commission. 

                    Regardless  of the label  the Commission places  on its

          decision to release the necessary  funds to YAEC and "advise" the

          licensee  to go  ahead with  its  CRP, it  was effectively,  even

          explicitly, permitting  YAEC to  decommission the  facility.   An

          agency  cannot  skirt   NEPA  or  other  statutory   commands  by

          essentially exempting a licensee  from regulatory compliance, and

          then simply labelling its decision "mere oversight" rather than a

          major  federal action.   To  do  so is  manifestly arbitrary  and

          capricious. 

                    We note that  the Commission's arguments on  this issue

          are  implicitly  predicated on  the assumed  validity of  its new

          interpretative  policy.   As  we  have  explained,  however,  the

          Commission has  failed to  provide any  rational explanation  for

          this  policy, thus  rendering it arbitrary  and capricious.   The

          Commission therefore cannot rely on its new policy as a basis for

          its  decision that  NEPA  compliance  was  unnecessary  prior  to

          decommissioning at  Yankee NPS.   Accordingly,  we find that  the

          Commission's action  in  allowing YAEC  to  complete 90%  of  the

          decommissioning at Yankee NPS prior to NEPA compliance lacked any

          rational basis, and was thus arbitrary and capricious.  We remand

                                         -19-

          this issue to the Commission  for actions in accordance with this

          holding.8

                    C.   Petitioner's Remaining Arguments
                    C.   Petitioner's Remaining Arguments
                         ________________________________

                      1.  Petitioner's Fifth Amendment Arguments
                      1.  Petitioner's Fifth Amendment Arguments
                          ______________________________________

                    CAN contends that because the property interests of its

          members  have  been  "invaded  by  radiation  due  to  the  NRC's

          regulatory  decisions concerning  the decommissioning"  of Yankee

          NPS, the  NRC's actions constitute  a regulatory taking  of their

          property  in violation of the Fifth Amendment.  We need not dwell

          on this  argument, however,  as CAN has  not stated  a cognizable

          takings claim.   Beyond its  general statement that  its property

          interests have been "invaded" by radiation, CAN has not explained

          or argued even  generally how this is  so, nor does it  offer any

          factual support  for its claims  regarding radiation.9   CAN also

          does  not  seek  compensation for  any  alleged  invasion of  its

          property  interests,  but simply  wishes  a  hearing  on the  CRP

          activities.    Given the  sparsity  of  its allegations  and  the

                              
          ____________________

          8  We recognize that this holding comes too late to  prevent much
          of  the  CRP activity.    There remains,  however,  a significant
          amount  of radioactive material and structures  at the Yankee NPS
          site, the removal  of which will continue to  affect CAN members.
          This  continued removal will undoubtedly continue to pose health,
          safety  and   environmental  questions,  thereby   requiring  NRC
          oversight and  NEPA compliance.    CAN's arguments on  this point
          are therefore not moot. 

          9  In  its brief,  CAN does  point to  the statement  made in  an
          affidavit by CAN member Will Sparks, describing the NRC's actions
          as "a form  of invasion, like have [sic] a stranger in the house,
          like   being  burglarized."    Even  assuming  that  Mr.  Sparks'
          affidavit is properly  part of the record in  this petition, this
          statement is simply insufficient to support a broad takings claim
          like the one put forth here. 

                                         -20-

          complete  lack  of  argument  or factual  support  for  its  bare

          assertion, we see no reason  to depart from the well-settled rule

          in this circuit that "issues adverted to in a perfunctory manner,

          unaccompanied  by  some effort  at  developed  argumentation, are

          deemed waived."   United States v. Zannino,  895 F.2d 1, 17  (1st
                            _____________    _______

          Cir. 1990).   "It  is not  sufficient for  a party  to mention  a

          possible argument in the most  skeletal way, leaving the court to

          .  . . put  flesh on  its bones."   Id.  Consequently,  we reject
                                              __

          CAN's takings claim.

                    Nor do we find any merit in CAN's rather vague allusion

          to  a more general Fifth Amendment  argument, presumably that the

          NRC's  actions deprived its members  of life, liberty or property

          without due  process of  law.  This  contention suffers  from the

          same deficiencies as CAN's takings claim, being overbroad, vague,

          and unaccompanied by factual  support or analysis.   Moreover, as

          the NRC points out, "generalized health, safety and environmental

          concerns do  not constitute  liberty or  property subject  to due

          process protections."   West Chicago, Ill. v. NRC,  701 F.2d 632,
                                  __________________    ___

          645 (7th Cir.  1983).  We simply cannot  fashion a constitutional

          violation  out  of  whole cloth  on  the  basis  of the  kind  of

          nonspecific and  unsupported  allegations  raised  by  CAN  here.

          Accordingly, we reject  CAN's allegations that the  NRC's actions

          violated its members' Fifth Amendment due process rights.

                      2.  Petitioner's Atomic Energy Act Arguments
                      2.  Petitioner's Atomic Energy Act Arguments
                          ________________________________________

                    CAN  contends  that Commission  approval of  YAEC's CRP

          violated AEA section 189a, which requires the Commission to grant

                                         -21-

          a  hearing upon  request by  any  party in  interest whenever  it

          undertakes any proceeding to "amend" a license.  42 U.S.C.   2239

          (a)(1)(A).  CAN argues that Commission approval of YAEC's CRP was

          a de facto  "amendment" of YAEC's POL because  it authorized YAEC
            __ _____

          (as well as other extant  and prospective licensees) to engage in

          materially  different conduct  not  permitted under  the pre-1993

          POL,   namely,  major  component  dismantling  absent  prior  NRC

          approval of a final decommissioning plan. See 53 Fed. Reg. 24018,
                                                    ___

          24020 (1988).  The   Commission  counters   that  its   so-called

          "approval"  of the  CRP cannot  be deemed  a license  "amendment"

          proceeding  since the language  requiring NRC approval  for major

          structural  changes was never  expressly incorporated into YAEC's

          license.10     Instead,   it   says,  the   decommissioning  plan

          procedure,  which  is subject  to  procedural protections  (e.g.,
                                                                      ____

          public  hearings,   preparation  of   environmental  assessments)

          entirely different  from those  designated in  section 189a,  was
          __________________

          described only  in a cover  letter accompanying the  license, and

          the Commission has never treated the decommissioning plan process

          as "amendatory" for section 189a purposes.

                    We reject the Commission's claim that its abrupt policy

          change  in  1993, to  the  extent it  substantially  enlarged the

          authority of an extant licensee (YAEC) retroactively, nonetheless
                          ______

                              
          ____________________

          10  As a threshold  matter, the Commission repeats its contention
          that no   2239(a)(1)(A) "proceeding" occurred, because it took no
          affirmative action  and merely  refused to  intervene to  prevent
          YAEC from undertaking the CRP.   For the reasons previously noted
          in our discussion of the  Commission's NEPA violations, see supra
                                                                  ___ _____
          at 17-18, we disagree with this characterization.

                                         -22-

          did not  entitle CAN to the  requested section 189a  hearing.  As

          the Commission  itself  concedes,  by  its nature  a  license  is

          presumptively  an exclusive  -- not  an  inclusive --  regulatory
                            _________

          device.  See Brief for  Respondent at 5 ("Th[e] license describes
                   ___

          the facility  and the authorized activities that the operator may

          conduct under the license.  If the holder of the licensee (sic) .

          . . wishes to modify the facility or to take actions that are not
                     ______________________________________________________

          specifically  authorized under the license, the licensee may need
          __________________________________________

          to  seek a change or  'amendment' to the  terms of the license.")

          (emphasis   added).     The  sophistical   suggestion  that   the

          decommissioning plan procedures were never formally  incorporated

          into  YAEC's POL license  ignores licensing realities.   Licenses

          customarily delineate the types of regulated conduct in which the

          licensee   may  engage.    Regulated  conduct  which  is  neither

          delineated,   nor   reasonably  encompassed   within   delineated

          categories   of   authorized   conduct,   presumptively   remains

          unlicensed.   YAEC's  original license  did not  authorize it  to

          implement major-component dismantling  of the type undertaken  in

          the CRP.

                    Thus, if section 189a is to serve its intended purpose,

          surely it  contemplates that  parties in  interest be afforded  a

          meaningful opportunity to request a hearing before the Commission
                                                      ______

          retroactively reinvents the terms of an extant license by voiding
          _____________

          its implicit limitations on the licensee's  conduct.  See Skidgel
                                                                ___ _______

          v. Maine Dep't of Human Servs., 994 F.2d 930, 937 (1st Cir. 1993)
             ___________________________

          (statutory language must be interpreted in context, including its

                                         -23-

          legislative purpose).   The claimed right to deny  such a hearing

          request undermines  the integrity of  the licensing process.   At

          the time  YAEC obtained its  original license, and again  when it

          amended the  original  license to  a  POL, parties  in  interest,

          including  CAN, presumably  refrained  from  any  request  for  a

          section 189a hearing --  to which they would  unquestionably have
                                                        ______________

          been  entitled --  in  reasonable  reliance  upon  such  implicit

          limitations in YAEC's license.

                    The  Commission  correctly  points  out  that  we  have

          observed that the term "amend," as used in section 189a, is to be

          construed  quite literally.  See Commonwealth  of Mass. v. United
                                       ___ ______________________    ______

          States  Nuclear Regulatory Comm'n, 878  F.2d 1516, 1522 (1st Cir.
          _________________________________

          1989).   But  we were  careful to  note as  well that  it is  the

          substance of  the NRC  action that  determines  entitlement to  a
          _________

          section 189a hearing, not the particular label the NRC chooses to
                                ___

          assign to its action.   Id. at 1521 (citing Columbia Broadcasting
                                  ___                 _____________________

          Syst. Inc. v. United States, 316 U.S. 407, 416 (1942)).11
          __________    _____________
                              
          ____________________

          11   Moreover,  Commonwealth is  readily  distinguishable on  its
                          ____________
          facts.    There,   the  NRC  decision  approving   resumption  of
          operations  by  a  licensee, which  had  shut  down its  facility
          voluntarily  prior to any formal suspension  or revocation of its
          operating license  by the  NRC, did not  implicate section  189a.
          Rather, the  NRC requirements  for  license "reinstatement"  were
          simply  additional   interim  license  restrictions   --  imposed
                  ___________________________________________
          pursuant  to pre-existing Commission regulations -- none of which
                       ____________
          conflicted with, or  required the alteration of, any  term of the
          original license.   Commonwealth, 878 F.2d at 1520-21 (citing and
                              ____________
          adopting rationale  in In re  Three Mile Island Alert,  Inc., 771
                                 _____________________________________
          F.2d 720  (3d Cir.  1985), cert. denied,  475 U.S.  1082 (1986)).
                                     _____ ______
          Thus,  the  operator obtained  no  greater authority  (literally,
                                             _______
          "license") than it  had before its license was  reinstated by the
          NRC.   Id.  at  1520.   Even  though  the Commission  temporarily
                 ___
          exempted  the licensee from  one restriction generally applicable
          to  other licensees,  the discretionary  exemption was  expressly

                                         -24-

                    By  contrast,   the  policy   change  adopted  by   the

          Commission in  1993, relating  to "minor"  component dismantling,

          was  in   no  sense   provisional.     Moreover,  it   undeniably

          supplemented   the  operating   authority  of   extant  licensees
          ____________

          generally,  and YAEC in particular, which might henceforth engage

          in major forms of component disassembly beyond the ambit of their

          original licenses.  Prior to 1993, parties in interest reasonably

          could presume that YAEC was not authorized to undertake this type

          of CRP unless it submitted to the lapidary process of preparing a

          final   decommissioning   plan   and   environmental   assessment

          acceptable to the NRC, or it moved to amend its existing license.
                                 _________________________________________

                    Then,  in  1993,  the  Commission,  by ambiguous  fiat,

          declared  that some forms of "major component disassembly" hence-

          forth were to  be outside the license-amendment  process, whereas
                ___________________

          more "serious" types of component removal  were to remain subject

          to  the amendment process.  See 10 C.F.R.    50.59.  In our view,
                                      ___

          however,  the   latter  provision   plainly  confirms   that  the

          Commission had always  considered component disassembly,  similar

          to that involved in YAEC's CRP, as action beyond the ambit of the

          presumptive authority granted under the licenses it issued.

                    The  Commission  elevates labels  over  substance.   It

          would have us determine that a "proceeding" specifically aimed at

          excusing a licensee  from filing a petition to  amend its license

                              
          ____________________

          authorized and granted under pre-existing agency regulations, see
                                       ____________                     ___
          id. at 1521, so that parties in  interest were on notice from the
          ___                                                      ________
          time the license was granted  that NRC retained the discretion to
          ____________________________
          approve the limited exemption at any time in the future.

                                         -25-

          is not  the functional equivalent of  a proceeding to  allow a de
                                                                         __

          facto "amendment"  to  its  license.   As  this  construct  would
          _____

          eviscerate the very procedural protections Congress envisioned in

          its  enactment  of  section  189a,  we  decline   to  permit  the

          Commission to do by indirection  what it is prohibited from doing

          directly.  See 42 U.S.C.    2239(a)(1)(A) (Commission must afford
                     ___

          hearing "in any proceeding  for the . .  . modification of  rules

          and regulations dealing with the  activities of licensees.").  We

          therefore hold that  CAN was entitled to a  hearing under section

          189a in connection  with the NRC decision to  permit YAEC's early

          CRP.

                                      CONCLUSION
                                      CONCLUSION

                    For  the foregoing reasons, we grant CAN's petition for
                                                   _____

          review in  part, and  remand to  the  Commission for  proceedings
                                ______

          consistent with this opinion.

                                         -26-