Revision of Fee Schedules; Fee Recovery for FY 2007, 5108-5140 [E7-1634]

Agencies

• NUCLEAR REGULATORY COMMISSION

[Federal Register Volume 72, Number 22 (Friday, February 2, 2007)]
[Proposed Rules]
[Pages 5108-5140]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E7-1634]



[[Page 5107]]

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Part II





Nuclear Regulatory Commission





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10 CFR Parts 170 and 171



Revision of Fee Schedules; Fee Recovery for FY 2007; Proposed Rule

Federal Register / Vol. 72, No. 22 / Friday, February 2, 2007 / 
Proposed Rules

[[Page 5108]]


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NUCLEAR REGULATORY COMMISSION

10 CFR Parts 170 and 171

RIN 3150-AI00


Revision of Fee Schedules; Fee Recovery for FY 2007

AGENCY: Nuclear Regulatory Commission.

ACTION: Proposed rule.

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SUMMARY: The Nuclear Regulatory Commission (NRC) is proposing to amend 
the licensing, inspection, and annual fees charged to its applicants 
and licensees. The proposed amendments are necessary to implement the 
Omnibus Budget Reconciliation Act of 1990 (OBRA-90), as amended, which 
requires that the NRC recover approximately 90 percent of its budget 
authority in fiscal year (FY) 2007, less the amounts appropriated from 
the Nuclear Waste Fund (NWF), and for Waste Incidental to Reprocessing 
(WIR) and generic homeland security activities. Based on the FY 2007 
Energy and Water Development Appropriations Bill (H.R. 5427), passed by 
the U.S. House of Representatives, the NRC's required fee recovery 
amount for the FY 2007 budget is approximately $663.7 million. After 
accounting for carryover and billing adjustments, the total amount to 
be recovered through fees is approximately $664.9 million. A final 
appropriation has not been enacted. Thus, the total amount that must be 
recovered through fees may be different once a final appropriation is 
enacted.

DATES: The comment period expires March 5, 2007. Comments received 
after this date will be considered if it is practical to do so, but the 
NRC is able to ensure only that comments received on or before this 
date will be considered. Because OBRA-90 requires that the NRC collect 
the FY 2007 fees by September 30, 2007, requests for extensions of the 
comment period will not be granted.

ADDRESSES: You may submit comments by any one of the following methods. 
Please include number RIN 3150-AI00 in the subject line of your 
comments. Comments on rulemakings submitted in writing or in electronic 
form will be made available to the public in their entirety on the NRC 
rulemaking Web site. Personal information will not be removed from your 
comments.
    Mail comments to: Secretary, U.S. Nuclear Regulatory Commission, 
Washington, DC 20555-0001, ATTN: Rulemakings and Adjudications Staff.
    E-mail comments to: SECY@nrc.gov. If you do not receive a reply e-
mail confirming that we have received your comments, contact us 
directly at (301) 415-1966. You may also submit comments via the NRC's 
rulemaking Web site at https://ruleforum.llnl.gov. Address questions 
about our Web site to Ms. Carol Gallagher, 301-415-5905; e-mail 
CAG@nrc.gov. Comments can also be submitted via the Federal eRulemaking 
Portal at https://www.regulations.gov.
    Hand deliver comments to: 11555 Rockville Pike, Rockville, Maryland 
20852, between 7:30 a.m. and 4:15 p.m. Federal workdays. (Telephone 
301-415-1966).
    Fax comments to: Secretary, U.S. Nuclear Regulatory Commission at 
(301) 415-1101.
    Publicly available documents related to this rulemaking may be 
viewed electronically on the public computers located at the NRC's 
Public Document Room (PDR), Room O1 F21, One White Flint North, 11555 
Rockville Pike, Rockville, Maryland. The PDR reproduction contractor 
will copy documents for a fee. Selected documents, including comments, 
may be viewed and downloaded electronically via the NRC rulemaking Web 
site at https://ruleforum.llnl.gov.
    To obtain additional information on the NRC's FY 2007 budget 
request, commenters and others may review NUREG-1100, Volume 22, 
``Performance Budget: Fiscal Year 2007'' (February 2006), which 
describes the NRC's budget for FY 2007, including the activities to be 
performed in each program. This document is available on the NRC's 
public Web site at https://www.nrc.gov/reading-rm.html. Note, however, 
that NUREG-1100, Volume 22, is based on the NRC's FY 2007 budget 
request to Congress, and that the fees in this rulemaking are based on 
the version of the NRC's FY 2007 budget approved by the U.S. House of 
Representatives in H.R. 5427, as discussed in more detail later in this 
document. The NRC budget in H.R. 5427 includes an additional 
approximately $40 million, above the NRC's budget request, for 
activities such as new reactor licensing and related support. The 
allocation of the H.R. 5427 budget to planned activities within each 
program, and to each fee class and surcharge category, is included in 
the publicly available work papers supporting this rulemaking.
    Publicly available documents created or received at the NRC after 
November 1, 1999, are available electronically at the NRC's Electronic 
Reading Room at https://www.nrc.gov/reading-rm/adams.html. From this 
site, the public can gain entry into the NRC's Agencywide Documents 
Access and Management System (ADAMS), which provides text and image 
files of NRC's public documents. If you do not have access to ADAMS or 
if there are problems in accessing the documents located in ADAMS, 
contact the NRC PDR Reference staff at 1-800-397-4209; 301-415-4737 or 
by e-mail at pdr@nrc.gov.

FOR FURTHER INFORMATION CONTACT: Renu Suri, telephone 301-415-0161; 
Office of the Chief Financial Officer, U.S. Nuclear Regulatory 
Commission, Washington, DC 20555-0001.

SUPPLEMENTARY INFORMATION: 
I. Background
II. Proposed Action
III. Plain Language
IV. Voluntary Consensus Standards
V. Environmental Impact: Categorical Exclusion
VI. Paperwork Reduction Act Statement
VII. Regulatory Analysis
VIII. Regulatory Flexibility Analysis
IX. Backfit Analysis

I. Background

    The NRC is required each year, under OBRA-90, as amended, to 
recover approximately 90 percent of its budget authority (less amounts 
appropriated from the NWF and for other activities specifically removed 
from the fee base), through fees to NRC licensees and applicants. The 
NRC receives appropriations each year for 10 percent of its budget 
authority (less amounts appropriated from the NWF and for other 
activities specifically removed from the fee base), to pay for the 
costs of agency activities that do provide a direct benefit to NRC 
licensees, such as international assistance and Agreement State 
activities under section 274 of the Atomic Energy Act of 1954, as 
amended.
    The NRC assesses two types of fees to meet the requirements of 
OBRA-90, as amended. First, license and inspection fees, established in 
10 CFR part 170 under the authority of the Independent Offices 
Appropriation Act of 1952 (IOAA), 31 U.S.C. 9701, recover the NRC's 
costs of providing special benefits to identifiable applicants and 
licensees. Examples of the services provided by the NRC for which these 
fees are assessed are the review of applications for new licenses and 
the review of renewal applications, the review of amendment requests, 
and inspections. Second, annual fees established in 10 CFR part 171 
under the authority of OBRA-90, as amended, recover generic and other 
regulatory costs not otherwise recovered through 10 CFR part 170 fees.

[[Page 5109]]

    The NRC is currently operating under a continuing resolution (CR) 
for FY 2007 (Pub. L. 109-383) that is effective through February 15, 
2007. This means that the FY 2007 funds currently available are similar 
to the NRC's funding in FY 2006. Although the NRC has not received a 
new appropriation for FY 2007, the NRC must proceed with this 
rulemaking to collect the required fee amounts by September 30, 2007. 
Therefore, the NRC is establishing fees in this rulemaking based on the 
FY 2007 Energy and Water Development Appropriations Bill (H.R. 5427), 
passed by the U.S. House of Representatives. The NRC is basing its FY 
2007 fees on this version of its FY 2007 appropriations because this 
amount has been approved by the full House of Representatives. The 
Senate version of this bill is similar: The total funding is the same, 
but the allocation of the budget to certain activities is slightly 
different.
    If Congress enacts a different version of the NRC budget than that 
included in H.R. 5427, the fees in the NRC's FY 2007 final fee rule 
will be adjusted to reflect the enacted budget. Therefore, fees in the 
FY 2007 final fee rule may differ from the fees in this proposed rule. 
The NRC will adjust the FY 2007 final fees based on the enacted version 
of the budget without seeking further public comment.
    For example, if Congress enacts legislation that requires the NRC 
to operate under a CR for the full FY 2007 and appropriates 
significantly less to the NRC, the fees in the FY 2007 final fee rule 
will be modified from the fees in this FY 2007 proposed fee rule, to 
reflect the reductions in budgeted resources. The NRC's total required 
fee recovery could be reduced by approximately $80 million under a 
full-year CR, as compared to H.R. 5427, although the NRC's exact fee 
recovery amount would depend on the specific provisions in such 
legislation. A given licensee's part 171 annual fees under a full-year 
CR would be either similar to, or less than, the fees included in this 
proposed fee rule. (Fees in the FY 2007 final fee rule may also change 
from this proposed fee rule for other reasons, such as changes in the 
amount expected to be received from part 170 fees in FY 2007 compared 
to FY 2006.) Under a full-year CR, annual fees for some license fee 
classes may be affected more than other license fee classes, based on 
which NRC activities are subject to budget reductions. It is possible 
that some annual fees may increase from this proposed rule under a 
full-year CR, because the NRC's ten percent fee relief, which is used 
to reduce all annual fees in this proposed rule (discussed more in 
Section II.B.2, ``Application of `Fee Relief'/Surcharge Changes''), 
would be reduced. This may occur if a particular license fee class is 
not subject to budget reductions under a CR, and also receives a 
smaller annual fee reduction than that included in this proposed fee 
rule from the NRC's fee relief. The change in appropriations under a 
full-year CR would be unlikely to have a significant impact on the part 
170 hourly rates included in this proposed rule.
    Based on H.R. 5427, the NRC's required fee recovery amount for the 
FY 2007 budget is approximately $663.7 million, which is increased by 
approximately $1.2 million to account for billing adjustments (i.e., 
expected unpaid invoices), resulting in a total of approximately $664.9 
million that must be recovered through fees in FY 2007.
    In accordance with Section 637 of the Energy Policy Act of 2005 
(Pub. L. 109-58), the budgeted resources associated with generic 
homeland security activities are excluded from the NRC's fees each 
year, beginning with this FY 2007 fee rule. This new legislative 
provision was discussed in the NRC's FY 2006 proposed and final fee 
rules (71 FR 7349, February 10, 2006; 71 FR 30721, May 30, 2006), and 
results in the removal of approximately $35.3 million from the fee base 
in FY 2007. These funds cover generic activities--those activities that 
support an entire license fee class or classes of licensees--such as 
rulemakings and guidance development. Under the NRC's authority under 
the IOAA, the NRC will continue to bill under part 170 for all 
licensee-specific homeland security-related services provided, 
including security inspections (which include force-on-force exercises) 
and security plan reviews.
    The amount of the NRC's required fee collections is set by law, and 
is therefore outside the scope of this rulemaking. In FY 2007, the 
NRC's total fee recovery increased by $39.9 million from FY 2006, 
mostly in response to increased workload for new reactor licensing 
activities. The FY 2007 budget was allocated to the fee classes that 
the budgeted activities support. As such, the proposed annual fees for 
reactor licensees increased. The proposed annual fees for most other 
licensees decreased due to factors such as the removal of generic 
homeland security resources from the fee base, and other reductions in 
budgeted resources allocated to the fee classes. Another factor 
affecting the amount of annual fees for each fee class is the estimated 
collection under part 170, discussed in the Proposed Action section of 
this document.

II. Proposed Action

    The NRC is proposing to amend its licensing, inspection, and annual 
fees to recover approximately 90 percent of its FY 2007 budget 
authority (less the appropriations received from the NWF, and for WIR 
and generic homeland security activities). The NRC's total budget 
authority for FY 2007 (under H.R. 5427) is $816.6 million. Of that 
total, approximately $41 million is appropriated from the NWF, $2.9 
million is budgeted for WIR activities, and $35.3 million is budgeted 
for generic homeland security. Based on the 90 percent fee recovery 
requirement, the NRC must recover approximately $663.7 million in FY 
2007 through part 170 licensing and inspection fees and part 171 annual 
fees. After accounting for carryover and billing adjustments, the total 
amount to be recovered through fees is approximately $664.9 million. 
The NRC's FY 2007 fee recovery is $39.9 million more than the amount 
estimated for recovery in FY 2006, an increase of approximately six 
percent.
    The FY 2007 statutorily required fee recovery amount of $663.7 
million is increased by $1.7 million to account for billing adjustments 
(i.e., for FY 2007 invoices that the NRC estimates will not be paid 
during the fiscal year, less payments received in FY 2007 for prior 
year invoices). There is approximately $0.5 million FY 2006 carryover 
to apply to FY 2007 fee collections. This leaves approximately $664.9 
million to be recovered in FY 2007 through part 170 licensing and 
inspection fees and part 171 annual fees.
    The NRC estimates that approximately $193.4 million will be 
recovered in FY 2007 from part 170 fees. This represents an increase of 
approximately five percent as compared to the part 170 collections for 
FY 2006 of $185 million. The NRC derived the FY 2007 estimate of part 
170 fee collections based on the previous four quarters of billing data 
for each license fee class, with adjustments to account for changes in 
the NRC's FY 2007 budget, as appropriate. The remaining $471.5 million 
will be recovered through the part 171 annual fees in FY 2007, compared 
to the required part 171 collections of $441.7 million for FY 2006, an 
increase of approximately seven percent.
    Table I summarizes the budget and fee recovery amounts for FY 2007 
(individual values may not sum to totals due to rounding).

[[Page 5110]]



          Table I.--Budget and Fee Recovery Amounts for FY 2007
                          [Dollars in millions]
------------------------------------------------------------------------
 
------------------------------------------------------------------------
Total Budget Authority..................................          $816.6
    Less NWF, WIR, and generic homeland security........           -79.2
                                                         ---------------
        Balance.........................................          $737.4
    Fee Recovery Rate for FY 2007.......................         x 90.0%
                                                         ---------------
Total Amount to be Recovered for FY 2007................          $663.7
    Less Carryover from FY 2006.........................            -0.5
                                                         ---------------
    Plus Part 171 Billing Adjustments
        Unpaid FY 2007 Invoices (estimated).............             5.4
        Less Payments Received in FY 2007 for Prior Year            -3.7
         Invoices (estimated)...........................
                                                         ---------------
        Subtotal........................................             1.7
                                                         ===============
Amount to be Recovered Through Parts 170 and 171 Fees...          $664.9
    Less Estimated Part 170 Fees........................          -193.4
                                                         ===============
Part 171 Fee Collections Required.......................          $471.5
------------------------------------------------------------------------

    The FY 2007 final fee rule will be a ``major rule'' as defined by 
the Congressional Review Act of 1996. Therefore, the NRC's fee 
schedules for FY 2007 will become effective 60 days after publication 
of the final rule in the Federal Register. The NRC will send an invoice 
for the amount of the annual fee to reactors and major fuel cycle 
facilities upon publication of the FY 2007 final rule. For these 
licensees, payment will be due on the effective date of the FY 2007 
rule. Those materials licensees whose license anniversary date during 
FY 2007 falls before the effective date of the final FY 2007 rule will 
be billed for the annual fee during the anniversary month of the 
license at the FY 2006 annual fee rate. Those materials licensees whose 
license anniversary date falls on or after the effective date of the 
final FY 2007 rule will be billed for the annual fee at the FY 2007 
annual fee rate during the anniversary month of the license, and 
payment will be due on the date of the invoice.
    The NRC will send an invoice for the amount of the annual fee to 
reactors, part 72 licensees, major fuel cycle facilities, and other 
licensees with annual fees of $100,000 or more, upon publication of the 
FY 2007 final rule. For these licensees, payment is due on the 
effective date of the FY 2007 final rule. Because these licensees are 
billed quarterly, the payment due is the amount of the total FY 2007 
annual fee, less payments made in the first three quarters of the 
fiscal year. Materials licensees with annual fees of less than $100,000 
are billed annually. Those materials licensees whose license 
anniversary date during FY 2007 falls before the effective date of the 
FY 2007 final rule will be billed for the annual fee during the 
anniversary month of the license at the FY 2006 annual fee rate. Those 
materials licensees whose license anniversary date falls on or after 
the effective date of the FY 2007 final rule will be billed for the 
annual fee at the FY 2007 annual fee rate during the anniversary month 
of the license, and payment will be due on the date of the invoice.
    As a matter of courtesy, the NRC plans to continue mailing the 
proposed fee rule to all licensees, although, as a cost saving measure, 
in accordance with its FY 1998 announcement, the NRC has discontinued 
mailing the final fee rule to all licensees. Accordingly, the NRC does 
not plan to routinely mail the FY 2007 final fee rule or future final 
fee rules to licensees.
    The NRC will send the final rule to any licensee or other person 
upon specific request. To request a copy, contact the License Fee Team, 
Division of Financial Management, Office of the Chief Financial 
Officer, at 301-415-7554, or e-mail fees@nrc.gov. The NRC plans to 
publish the final fee rule no later than June 2007. In addition to 
publication in the Federal Register, the final rule will be available 
on the Internet at https://ruleforum.llnl.gov for at least 90 days after 
the effective date of the final rule.
    The NRC is proposing to amend 10 CFR parts 170 and 171 as discussed 
in Sections II.A and II.B of this document.

A. Amendments to 10 CFR Part 170: Fees for Facilities, Materials, 
Import and Export Licenses, and Other Regulatory Services Under the 
Atomic Energy Act of 1954, as Amended

    The NRC is proposing to establish one hourly rate to recover the 
full cost of activities under part 170, and to use this rate to 
calculate ``flat'' application fees. Additionally, this rule proposes 
to revise the license application fees to (a) reflect the FY 2007 
hourly rate and to comply with the requirement under the Chief 
Financial Officers (CFO) Act of 1990 (Pub. L. 101-578, November 15, 
1990, 104 Stat. 2838) that fees be reviewed biennially and revised as 
necessary to reflect the cost to the agency, (b) establish new flat 
fees for requests for exemptions from import/export licensing 
requirements, and (c) change facilities flat fees to full cost fees. It 
also proposes to establish new fee categories under Sec.  170.31 and 
make minor administrative changes for purposes of clarification and 
consistency.
    The NRC is proposing the following changes:
1. Hourly Rate
    The NRC is proposing to establish in Sec.  170.20 one professional 
hourly rate for NRC staff time. This would be a change from the current 
policy of using two hourly rates, one for the Nuclear Reactor Safety 
(Reactor) Program, and one for the Nuclear Materials and Waste Safety 
(Materials) Program.
    From FY 1988 through 1994, the NRC used one agencywide professional 
hourly rate. In the FY 1995 fee rule (60 FR 32218; June 20, 1995), the 
NRC replaced the single rate with two professional hourly rates based 
on `cost center concepts' used for budgeting purposes, to more closely 
align budgeted costs with specific fee classes. The average difference 
in hourly costs between the Reactor and Materials Programs has been 
small for a number of years. From FY 1998 through FY 2006, the average 
difference in these rates was approximately two percent. The NRC does 
not have reason to

[[Page 5111]]

believe that these two rates will be notably different from each other 
in the future. Additionally, the NRC incurs administrative burden in 
calculating and billing two different hourly rates. Therefore, the NRC 
is proposing to return to the use of one hourly rate.
    The NRC's hourly rate is used in assessing full cost fees for 
specific services provided, as well as flat fees for certain 
application reviews. The FY 2007 proposed hourly rate is $256. This 
rate would be applicable to all activities for which fees are assessed 
under Sec. Sec.  170.21 and 170.31. In the FY 2006 final fee rule, the 
Reactor and Materials Program rates were $217 and $214, respectively.
    The FY 2007 proposed hourly rate is higher than the FY 2006 
Reactors and Materials Program rates mainly because of a downward 
revision to the NRC's estimate of direct hours worked per full-time 
equivalent employee (FTE) per year, which is used in the denominator of 
the hourly rate calculation (described in further detail later in this 
document). It is also higher due to Government-wide pay raises.
    The NRC's single hourly rate would be derived by dividing the sum 
of budgeted resources for (1) mission direct labor; (2) mission 
indirect (or program overhead) labor and non-labor activities 
(including mission direct travel); and (3) agency overhead labor and 
non-labor activities, by mission direct hours. The only budgeted 
resources excluded from the hourly rate are those for mission direct 
nonlabor (i.e., contract) activities. This method is consistent with 
the existing approach for calculating hourly rates for the Reactor and 
Materials Programs. The only difference is that the formula used to 
derive one average NRC hourly rate would be based on total NRC budgeted 
resources (excluding HLW, WIR, and generic homeland security), rather 
than using this same formula to calculate two rates based on resources 
allocated to the Reactor and Materials Programs.
    As noted previously, the FY 2007 proposed hourly rate is higher 
than the FY 2006 Reactors and Materials rates mainly due to a revision 
to the NRC's estimate of direct hours per FTE per year. The NRC last 
revised its estimate of direct hours worked annually per direct FTE in 
the FY 2005 final fee rule (70 FR 30525; May 26, 2005), when it began 
using an estimate of 1,446 hours. As explained in the FY 2005 final fee 
rule, this estimate is based on data from the NRC's time and labor 
system. The NRC has again reviewed data from its time and labor system 
to determine if this estimate requires updating for the FY 2007 fee 
rule. Based on this review of the most recent data available, the NRC 
determined that 1,287 is its best estimate of direct hours worked 
annually per FTE. This estimate excludes all non-mission direct hours, 
such as training, general administration, and leave. Because the NRC's 
hourly rates are calculated by dividing annual budgeted costs by the 
product of budgeted mission direct FTE and average annual direct hours 
per FTE, the lower the number of direct hours per FTE used in the 
calculation, the higher the hourly rates.
    The NRC is proposing to update its hourly rate calculation to 
reflect its latest estimate of direct hours per FTE to more accurately 
reflect the NRC's costs of providing part 170 services, which would 
allow the NRC to more fully recover the costs of these services through 
part 170 fees. The NRC believes that this is consistent with guidance 
provided in the Office of Management and Budget Circular A-25 on 
recovering the full cost of services provided to identifiable 
recipients. The resulting higher hourly rate would result in both 
increased full cost fees for licensing and inspection activities, and 
increased materials flat fees for license applications.
    Because costs not recovered under part 170 are recovered through 
part 171 annual fees, the increase in total part 170 fees (caused by 
the hourly rate increase) would result in a reduction to total annual 
fees of the same amount. As such, this hourly rate increase would shift 
some fee recovery from part 171 annual fees to part 170 fees for 
licensee-specific services. This change supports industry comments that 
consistently recommend that the NRC collect more of its budget through 
part 170 fees-for-services vs. part 171 annual fees. (Because the 
invoices reflecting these increased part 170 fees will not be paid by 
licensees until FY 2008--in light of the effective date of the FY 2007 
final rule and the timing of the NRC's regular billing cycle--the 
reduction in annual fees from this change would not occur until FY 
2008.)
    Because annual fees are adjusted to recover the remainder of the 
budgeted resources for a license fee class not recovered under part 
170, the total estimated fees (parts 170 plus 171) recovered from a 
license fee class would be the same regardless of the amount of the 
hourly rate. However, when implemented, higher hourly rates would 
result in some individual licensees paying less total fees than if this 
change were not enacted. This is true for those licensees for whom the 
NRC performs fewer hours of part 170 services than it does, on average, 
for a licensee in that class. Similarly, licensees for which the NRC 
performs more hours of part 170 services will pay more in total fees 
under the proposed higher hourly rate.
    Table II shows the results of the hourly rate calculation 
methodology. Due to rounding, adding the individual numbers in the 
table may result in a total that is slightly different than the one 
shown.

   Table II.--FY 2007 Budget Authority To Be Included in Hourly Rates
------------------------------------------------------------------------
 
------------------------------------------------------------------------
Mission Direct Program Salaries & Benefits..............         $250.9M
Mission Indirect (Program Overhead) Salaries & Benefits,          105.6M
 and Mission Direct Travel..............................
Agency Management and Support...........................          247.2M
                                                         ---------------
    Subtotal............................................          603.7M
                                                         ===============
Less Offsetting Receipts................................           -0.1M
                                                         ---------------
    Total Budget Included in Hourly Rate................         $603.6M
Mission Direct FTEs.....................................           1,835
Professional Hourly Rate (Total Budget Included in                  $256
 Hourly Rate divided by Mission Direct FTE times 1,287
 hours).................................................
------------------------------------------------------------------------

    As shown in Table II, dividing the $603.6 million budgeted amount 
(rounded) included in the hourly rate by total mission direct hours 
(1,835 FTE times 1,287 hours) results in an hourly rate of $256. The 
hourly rate is rounded to the nearest whole dollar.

[[Page 5112]]

2. ``Flat'' Application Fee Changes
    a. Revised Flat Fees. The NRC is proposing to adjust the current 
flat application fees in Sec. Sec.  170.21 and 170.31 to reflect the 
revised hourly rate of $256 and the results of the biennial review of 
part 170 fees required by the CFO Act of 1990. These flat fees are 
calculated by multiplying the average professional staff hours needed 
to process the licensing actions by the professional hourly rate for FY 
2007.
    To comply with the requirements of the CFO Act, the NRC has 
evaluated historical professional staff hours used to process a new 
license application for those materials users fee categories subject to 
flat application fees. This review also included new license and 
amendment applications for import and export licenses.
    Evaluation of the historical data shows that fees based on the 
average number of professional staff hours required to complete 
licensing actions in the materials program should be increased in some 
fee categories and decreased in others to more accurately reflect 
current costs incurred in completing these licensing actions. The data 
for the average number of professional staff hours needed to complete 
new licensing actions was last updated for the FY 2005 final fee rule. 
Thus, the revised average professional staff hours in this proposed fee 
rule reflect the changes in the NRC licensing review program that have 
occurred since that time.
    As a result of the biennial review, the proposed application fees 
for materials users are based on the average professional staff hours 
that reflect an increase in average time for new license applications 
for four of the 34 Materials Program fee categories, a decrease in 
average time for six fee categories, and the same average time for the 
remaining 24 fee categories. [Note that for fee category 3.H., the NRC 
used seven years of data (rather than five) to determine the average 
application hours, to mitigate the significant fee `swings' resulting 
from large changes to this estimate in the past two biennial reviews, 
which the NRC believes are more a function of data anomalies than 
substantive changes.] The average time for new license applications and 
amendments for export and import licenses increased for seven fee 
categories in Sec. Sec.  170.21 and 170.31, and remained the same for 
the others. The proposed reciprocity fee reflects a slight decrease in 
the average time supporting these licenses. The registration fee for 
general licensees (fee category 3.Q. under Sec.  170.31) also 
decreased.
    The higher hourly rate of $256 is the main reason for the increases 
in the application fees. Application fees for some fee categories 
(K.3., K.4., and K.5. under Sec.  170.21; and 3.C., 3.N., 3.O., 15.C., 
15.D., 15.E., 15.R., and 17 under Sec.  170.31) also increase because 
of the results of the biennial review of fees, which showed an increase 
in average time to process these types of license applications. (As 
discussed in the FY 2006 final fee rule, the average hours to process a 
category 17 application are based on similar licenses of broad scope.)
    The amounts of the materials licensing flat fees are rounded so 
that the fees would be convenient to the user and the effects of 
rounding would be ``de minimis.'' Fees under $1,000 are rounded to the 
nearest $10, fees that are greater than $1,000 but less than $100,000 
are rounded to the nearest $100, and fees that are greater than 
$100,000 are rounded to the nearest $1,000.
    The licensing flat fees are applicable for fee categories K.1. 
through K.5. of Sec.  170.21, and fee categories 1.C., 1.D., 2.B., 
2.C., 3.A. through 3.S., 4.B. through 9.D., 10.B, 15.A. through 15.R., 
16, and 17 of Sec.  170.31. Applications filed on or after the 
effective date of the FY 2007 final fee rule would be subject to the 
revised fees in the final rule.
    b. Flat Fees for Import/Export License Exemption Requests. The NRC 
is proposing to charge part 170 flat fees for requests for exemptions 
from import/export licensing requirements. The same fees would apply to 
these requests for exemptions as apply to requests for import/export 
licenses, because the NRC incurs similar costs in reviewing a license 
application as it does in reviewing an exemption request. The NRC does 
not receive many requests for exemptions from import/export licensing 
requirements, but is proposing to assess part 170 fees for these 
requests to comply with IOAA direction to recover the full costs of the 
services it provides to identifiable recipients.
    c. Change Facilities Flat Fees to Full Cost Fees. The NRC is 
proposing to eliminate the flat application fees in Sec.  170.21 A 
(application for a nuclear power reactor construction permit), C 
(application for a test facility/research reactor/critical facility 
construction permit), D (application for a manufacturing license), and 
G (application for other production and utilization facility 
construction permit), and instead charge full cost part 170 fees for 
these activities. Footnote 1 to Sec.  170.21 would also be modified to 
eliminate reference to provisions relating to these flat fees. The NRC 
is proposing to make this change because it does not have recent data 
on average professional hours associated with these types of 
applications. Therefore, the NRC believes it is more appropriate to 
charge full cost fees for these types of activities.
    The NRC is also proposing to eliminate fee category F, ``Advanced 
Reactors'', in Sec.  170.21. This is because applications of this type 
are already covered under other fee categories (e.g., fee category A, 
``Nuclear Power Reactors''). The definition of ``Advanced Reactor'' 
under Sec.  170.3 would also be eliminated.
3. New Fee Categories
    The NRC is proposing to amend Sec.  170.31 to establish a new fee 
category (2.A.(5)) for uranium water treatment facilities. The NRC 
recently received a license application for this type of facility, 
which was unique to the NRC and therefore not covered by existing fee 
categories. Accordingly, the NRC charged this applicant full cost part 
170 fees for reviewing its application under the ``special project'' 
fee category in Sec.  170.31. Because the NRC is proposing to add a fee 
category under Sec.  171.16 to establish an annual fee for this type of 
facility (see Section II.B.4.b of this document), the NRC is also 
proposing to add the same new fee category under Sec.  170.31, to 
maintain consistency of the fee categories under parts 170 and 171. 
This new fee category under Sec.  170.31 would state that these 
facilities are subject to full cost licensing and inspection fees.
    The NRC is also proposing to update the fee amounts for some new 
and revised proposed fee categories that were included in another NRC 
rulemaking. The NRC published a proposed rule on July 28, 2006 (71 FR 
42952) titled, ``Requirements for Expanded Definition of Byproduct 
Material,'' which would amend its regulations to include jurisdiction 
over certain radium sources, accelerator-produced radioactive 
materials, and certain naturally occurring radioactive material, as 
required by the Energy Policy Act of 2005. This July 28, 2006, rule 
proposed to establish three new fee categories and revise one existing 
fee category. These new and revised fee categories would include 
activities not currently covered by the NRC's existing regulations, but 
which would be covered by the July 28, 2006, proposed rule. As 
explained in that proposed rule (71 FR 42967), which was published 
before the effective date of the FY 2006 final fee rule, the fee 
amounts quoted reflected FY 2005 rates and budgeted resources. The NRC 
revises its fees each

[[Page 5113]]

year in light of the current fiscal year budget and other factors. 
Accordingly, this document provides the proposed fee amounts for these 
new and revised fee categories based on the FY 2007 budget and proposed 
hourly rates.
    The new and revised fee categories included in the July 28, 2006, 
proposed rule on the expanded definition of byproduct material are not 
included in this FY 2007 proposed fee rule for public comment. This is 
because these new and revised fee categories will be finalized as part 
of the NRC's final rule on the expanded definition of byproduct 
material. The NRC expects to publish a final rule on the requirements 
for the expanded definition of byproduct material in mid-2007. The fee 
calculation methodology and FY 2007 fee amounts for these new and 
revised fee categories are proposed for public comment as part of this 
FY 2007 proposed fee rule.
    The NRC's proposed rule on the expanded definition of byproduct 
material would establish a new fee category 3.R.(1), for individuals 
possessing quantities greater than the number of items or limits in 10 
CFR 31.12(a)(3), (4), or (5), but less than or equal to 10 times these 
quantities. That rule proposed that the application and annual fees for 
3.R.(1) be the same as those for fee category 8 under Sec.  170.31, 
given the similarity in regulatory effort. The FY 2007 proposed 
application and annual fees for the new fee category 3.R.(1) continue 
to be based on the level of effort for fee category 8, and are $590 and 
$2,100, respectively.
    The proposed rule on the expanded definition of byproduct material 
would also establish a new fee category 3.R.(2), for individuals 
possessing quantities greater than 10 times the number of items or 
limits in 10 CFR 31.12(a)(3), (4), or (5). That rule proposed that the 
application and annual fees for 3.R.(2) be the same as those for fee 
category 3.P. under Sec.  170.31, given the similarity in regulatory 
effort. The FY 2007 proposed application and annual fees for the new 
fee category 3.R.(2) continue to be based on the level of effort for 
fee category 3.P., and are $1,400 and $2,700, respectively.
    Additionally, the proposed rule on expanding the definition of 
byproduct material would also establish a new fee category 3.S., for 
the production of accelerator-produced radioactive materials. That rule 
proposed that the application and annual fees for 3.S. be the same as 
those for fee category 3.C. under Sec.  170.31, given the similarity in 
regulatory effort. The FY 2007 proposed application and annual fees for 
fee category 3.C. are $8,000 and $11,800, respectively. The proposed 
application and annual fees for fee category 3.S. are $8,000 and 
$10,800, respectively. The proposed fees for fee category 3.S. continue 
to be based on the level of effort associated with fee category 3.C. 
licensees. The proposed annual fee for 3.S. is slightly less than that 
for 3.C. because the 3.S. fee does not include a portion of the low-
level waste (LLW) surcharge, while the 3.C. fee does. This is because 
the licensees in fee category 3.C. directly benefit from the NRC's LLW 
activities, but the licensees in fee category 3.S. do not. (The LLW 
surcharge is included only in part 171 annual fees, and therefore does 
not affect the part 170 application fees.)
    Finally, the proposed rule on expanding the definition of byproduct 
material would revise the scope of fee category 3.B. to include 
licenses for repair, assembly, and disassembly of products containing 
radium-226. The FY 2007 proposed application and annual fees for fee 
category 3.B. are $4,500 and $8,300, respectively.
    Fees associated with the new and revised fee categories for the 
expanded definition of byproduct material will not be applicable until 
the effective date of the FY 2007 final fee rule (approximately early 
August 2007), or the effective date of the NRC's final rule on the 
expanded definition of byproduct material, whichever is later. FY 2007 
fees will be applicable to those new fee categories as of that date. As 
mentioned previously, these fee amounts will be updated each year.
    Note that the specific application and inspection hours used in the 
part 170 and 171 fees for all categories of materials users licensees, 
are included in the publicly available work papers supporting this 
proposed rulemaking. The calculation method used to determine materials 
users annual fees is explained in Section II.B.4.g of this document.
4. Administrative Amendments
    The NRC is proposing to revise Sec. Sec.  170.3 and 170.12 to 
clarify that unless otherwise specifically exempted, all specific 
services provided by the Commission are ``special projects'' for which 
full cost fees will be assessed under part 170. This is consistent with 
NRC's existing practice and regulations, but the proposed revisions 
more clearly state this.
    The NRC is also proposing to make other minor administrative 
changes. The NRC is proposing to eliminate the definitions for ``Indian 
organization'' and ``Indian tribe'' in Sec.  170.3, because these terms 
are no longer used in part 170. In Sec.  170.31, fee category 
1.A.(2)(c) would be modified to state that it includes all `other' 
licenses for fuel cycle activities under fee category 1.A(2), including 
hot cell facilities. The NRC is also proposing to eliminate the 
reference to footnote 4 in Sec.  170.31, fee categories 2.A.(2)(a), 
2.a.(2)(b), and 2.A.(2)(c), as this footnote is not applicable to these 
fee categories. Footnote 1(b) under Sec.  170.31 is also proposed to be 
revised to eliminate the listing of all full cost fee categories to 
eliminate redundancy. Additionally, footnote 1(c) under Sec.  170.31 is 
proposed to be revised to eliminate reference to amendments for 
licenses other than import and export licenses, as flat fees for other 
license amendments no longer apply. Finally, fee category 7.B. in Sec.  
170.31 is slightly modified so that the language describing this fee 
category is the same under both parts 170 and 171.
    In summary, the NRC is proposing to make the following changes to 
10 CFR part 170 --
    1. Establish one FY 2007 professional hourly rate of $256 to use in 
assessing fees for specific services;
    2. Revise the license application fees to (a) reflect the FY 2007 
hourly rate and to comply with the CFO Act requirement that fees be 
reviewed biennially and revised as necessary to reflect the cost to the 
agency, (b) establish new flat fees for requests for exemptions from 
import/export licensing requirements, and (c) change facilities flat 
fees to full cost fees;
    3. Establish new fee categories under Sec.  170.31; and
    4. Make minor administrative changes for purposes of clarification 
and consistency.

B. Amendments to 10 CFR Part 171: Annual Fees for Reactor Licenses and 
Fuel Cycle Licenses and Materials Licenses, Including Holders of 
Certificates of Compliance, Registrations, and Quality Assurance 
Program Approvals and Government Agencies Licensed by the NRC

    Beginning with this FY 2007 fee rule, the NRC is proposing to 
remove generic homeland security budgeted resources from the fee base. 
The NRC is also proposing to use its fee relief to reduce all 
licensees' annual fees, and modify some surcharge categories. This 
rulemaking also proposes to codify the NRC's policy regarding when the 
assessment of annual fees begins, and establish rebaselined annual fees 
based on the NRC's FY 2007 budget in H.R. 5427. Additionally, the NRC 
is proposing to revise the way it prorates annual fees for materials 
licenses of $100,000 or more, and establish some new fee categories. 
Finally, the NRC is

[[Page 5114]]

proposing some minor administrative amendments under part 171. The 
proposed amendments are described as follows:
1. Removal of Generic Homeland Security Budgeted Resources From the Fee 
Base
    As mentioned previously, the budgeted resources associated with 
generic homeland security activities are excluded from the NRC's fees 
each year, beginning with this FY 2007 rulemaking, in accordance with 
the Energy Policy Act of 2005. As a result, $35.3 million is removed 
from the NRC's required annual fee recovery in FY 2007. These funds 
cover generic homeland security activities such as rulemakings and 
guidance development. Under the NRC's authority under the IOAA, the NRC 
will continue to bill under part 170 for all licensee-specific homeland 
security-related services provided, including security inspections 
(which include force-on-force exercises) and security plan reviews.
2. Application of ``Fee Relief''/Surcharge Changes
    The NRC is proposing to use its fee relief to reduce all licensees' 
annual fees, based on their percent of the budget. Additionally, the 
NRC is proposing to make some revisions to the activities included in 
the surcharge.
    The NRC applies the 10 percent of its budget that it receives as 
fee relief under OBRA-90, as amended, to offset the costs of activities 
for which it does not charge fees or charges reduced fees. The costs of 
these ``surcharge'' activities are totaled, and then reduced by the 
amount of the NRC's fee relief. In prior years, any remaining surcharge 
costs were then allocated to all licensees' annual fees, based on their 
percent of the budget (i.e., over 80 percent was allocated to power 
reactors each year).
    In FY 2007, the NRC's 10 percent fee relief exceeds the total 
surcharge costs by approximately $9.6 million. Therefore, the NRC is 
proposing to use this fee relief to reduce all licensees' annual fees, 
based on their percent of the budget. This is consistent with the 
existing fee methodology, in that the benefits of the NRC's fee relief 
are allocated to licensees in the same manner as costs were allocated, 
when the NRC did not receive enough fee relief to pay for surcharge 
activities.
    The NRC is also proposing to modify some surcharge categories. 
First, the NRC is proposing to add a new surcharge category in FY 2007 
for the costs associated with a rulemaking on groundwater protection at 
in-situ leach (ISL) uranium extraction facilities. This change is in 
accordance with Commission Staff Requirements Memorandum COMJSM-06-
0001, ``Regulation of Groundwater Protection at In Situ Leach Uranium 
Extraction Facilities'' (ML060830525). Second, the NRC is proposing to 
eliminate the surcharge category for specific services to other Federal 
agencies, because these agencies became subject to part 170 fees to 
recover the costs of these services as of the effective date of the FY 
2006 final fee rule. Third, the NRC is proposing to eliminate the 
surcharge category for activities supporting unlicensed sites, because 
the NRC now charges part 170 fees to owners or operators of unlicensed 
sites in decommissioning (beginning July 25, 2006). All generic 
decommissioning resources associated with these sites have been 
allocated to the generic decommissioning/reclamation surcharge 
category. The budgeted resources associated with unregistered general 
licensees, previously included in the unlicensed sites surcharge 
category, are added to the new surcharge category that includes the ISL 
rulemaking.
    Note the NRC is also modifying the way it calculates the resources 
included in the generic decommissioning/reclamation surcharge category, 
which includes decommissioning resources for all fee classes except 
power reactors and the spent fuel storage/reactor decommissioning fee 
class. This is not a substantive or policy change, but rather a 
calculation method change that will result in a more accurate estimate 
of the actual costs of generic decommissioning/reclamation activities. 
In previous years, the budgeted resources allocated to each fee class 
included budgeted resources for site-specific decommissioning 
activities, and then the part 170 estimated decommissioning revenue was 
subtracted from each fee class. Beginning in FY 2007, all budgeted 
resources for decommissioning/reclamation activities (for fee classes 
other than power reactors and spent fuel storage/reactor 
decommissioning) are initially allocated to the generic 
decommissioning/reclamation surcharge category. This total is then 
reduced by the total estimated part 170 decommissioning revenue from 
all licensees (other than those in the power reactor and spent fuel 
storage/reactor decommissioning fee classes). The NRC is explaining 
this change because it results in a reduction in both the total 
allocated budgeted resources and estimated part 170 revenue for the 
affected fee classes, which are shown in Section II.B.4, ``Revised 
Annual Fees,'' of this document.
    The total budgeted resources for the NRC's surcharge activities in 
FY 2007 are $64.1 million. The NRC's total fee relief in FY 2007 is 
$73.7 million, leaving $9.6 million in fee relief to be used to reduce 
all licensees' annual fees. These values are shown in Table III 
(individual values may not sum to totals due to rounding).

                       Table III.--Surcharge Costs
                          [Dollars in millions]
------------------------------------------------------------------------
                                                              FY 2007
                    Category of costs                     budgeted costs
------------------------------------------------------------------------
1. Activities not attributable to an existing NRC
 licensee or class of licensee:
    a. International activities.........................           $12.7
    b. Agreement State oversight........................             9.1
2. Activities not assessed part 170 licensing and
 inspection fees or part 171 annual fees based on
 existing law or Commission policy:
    a. Fee exemption for nonprofit educational                       8.7
     institutions.......................................
    b. Costs not recovered from small entities under 10              5.1
     CFR 171.16(c)......................................
3. Activities supporting NRC operating licensees and
 others:
    a. Regulatory support to Agreement States...........            11.1
    b. Generic decommissioning/reclamation (not related             14.9
     to the power reactor and spent fuel storage fee
     classes)...........................................
    c. ISL rulemaking and unregistered general licensees             2.5
                                                         ---------------
        Total surcharge costs...........................            64.1
                                                         ===============

[[Page 5115]]

 
Less 10 percent of NRC's FY 2007 total budget (less NWF,           -73.7
 WIR, and generic homeland security activities).........
                                                         ---------------
    Fee Relief to be Allocated to All Annual Fees.......            -9.6
------------------------------------------------------------------------

    Table IV shows how the NRC is proposing to allocate the $9.6 
million in fee relief to each license fee class (individual amounts may 
not sum to totals due to rounding). As explained previously, the NRC is 
proposing to allocate this fee relief to each license fee class based 
on the percent of the budget for that fee class compared to the NRC's 
total budget. The fee relief would then be used to partially offset the 
required annual fee recovery from each fee class. The proposed 
revisions to Sec. Sec.  171.15(d)(1) and 171.16(e) would clarify that 
the surcharge allocated to annual fees may be negative, i.e., an annual 
fee reduction.
    Separately, the NRC has continued to allocate the LLW surcharge 
costs based on the volume of LLW disposal of certain classes of 
licenses. Table IV also shows the allocation of the LLW surcharge. 
Because LLW activities support NRC licensees, the costs of these 
activities are not offset by the NRC's fee relief. For FY 2007, the LLW 
surcharge costs are $3.4 million. Because the allocated LLW surcharge 
exceeds the fee relief allocated to the materials users fee class, the 
annual fee recovery for this fee class includes a net addition to its 
annual fees for the surcharge costs.

                              Table IV.--Allocation of Fee Relief and LLW Surcharge
----------------------------------------------------------------------------------------------------------------
                                                             LLW surcharge      Fee relief surcharge     Total
                                                        ----------------------    (fee reduction)      surcharge
                                                                              ----------------------------------
                                                          Percent       $M      Percent       $M          $M
Operating Power Reactors...............................         74        2.6       87.7        -8.4        -5.8
Spent Fuel Storage/Reactor Decomm......................  .........  .........        3.6        -0.3        -0.3
Test and Research Reactors.............................  .........  .........        0.1         0           0
Fuel Facilities........................................          8        0.3        4.9        -0.5        -0.2
Materials Users........................................         18        0.6        3.2        -0.3         0.3
Transportation.........................................  .........  .........        0.3         0           0
Rare Earth Facilities..................................  .........  .........        0.0         0           0
Uranium Recovery.......................................  .........  .........        0.2         0           0
                                                        --------------------------------------------------------
    Total Surcharge....................................        100        3.4      100.0        -9.6        -6.1
----------------------------------------------------------------------------------------------------------------

3. Codification of Policy Regarding When the Assessment of Annual Fees 
Begins
    The Commission is proposing to modify Sec. Sec.  171.3 and 171.16, 
to codify its longstanding practice regarding when the assessment of 
annual fees begins for licensees subject to regulations that require a 
specific NRC authorization to operate subsequent to the NRC issuing the 
license. For these licensees, annual fees will not be assessed until 
the NRC grants this authorization. At the present time, this 
codification only affects new uranium enrichment licensees, as 
described further in this document. (The NRC's regulations already 
provide that part 52 combined operating license holders are not subject 
to annual fees until the Commission authorizes fuel load and operation 
of the reactor. This is also described further in this document.)
    All other licensees will continue to be subject to annual fees at 
the time the license is issued. This is consistent with the policy that 
annual fees are assessed to licensees based on the benefits of 
receiving the NRC's authorization to operate, whether or not the 
licensee chooses to operate (with the exception of power reactors in 
decommissioning or possession only status, which are assessed annual 
fees if they have spent fuel onsite). Once a facility is authorized to 
operate, it continues to pay its annual fee(s) even if it shuts down 
for safety or other reasons and needs Commission approval to restart.
    These amendments codify previous Commission decisions on this 
issue. The Commission first adopted this fee policy when it did not 
assess annual fees on those entities holding only a power reactor 
construction permit. The Commission indicated its intention to continue 
this policy when it included a provision in the Fiscal Year 2002 final 
fee rule (67 FR 42611; June 24, 2002), which expanded the scope of part 
171 to cover combined licenses authorizing operation of a power reactor 
(part 52 licenses). The Statement of Considerations for this June 2002 
final rule further explained that an annual fee for part 52 licensees 
will only be assessed after construction has been completed, all 
regulatory requirements have been met, and the Commission authorizes 
operation of the reactor. Additionally, the NRC published a proposed 
rule on March 13, 2006 (71 FR 12782), ``Licenses, Certifications, and 
Approvals for Nuclear Power Plants,'' that included a provision that 
states that a combined license holder does not have to pay an annual 
fee until the Commission authorizes fuel load and operation.
    Other than part 52 licenses, a uranium enrichment facility is the 
only other current type of licensee subject to regulations that require 
a specific NRC authorization to operate subsequent to the NRC issuing 
the license. In the case of uranium enrichment facilities, this 
authorization occurs after the Commission verifies through inspection 
that the facility has been constructed in accordance with the 
requirements of the license, as required by 10 CFR 40.41(g) and 10 CFR 
70.32(k). Therefore, the Commission is proposing to codify its policy 
that annual fees for uranium

[[Page 5116]]

enrichment facilities would be assessed at that time.
    In the future, should the NRC amend its regulations to require 
specific authorizations for other types of licenses before the licensee 
may operate, the NRC will revise part 171 to explicitly state that 
these other types of licenses are also not subject to annual fees until 
the NRC grants the required authorization(s).
4. Revised Annual Fees
    The NRC is proposing to revise its annual fees in Sec. Sec.  171.15 
and 171.16 for FY 2007 to recover approximately 90 percent of the NRC's 
FY 2007 budget authority (less the amounts appropriated from the NWF, 
and for WIR and generic homeland security activities), less the 
estimated amount to be recovered through part 170 fees. The total 
amount to be recovered through annual fees for FY 2007 is $471.5 
million. The required annual fee collection in FY 2006 was $441.7 
million.
    The NRC uses one of two methods to determine the amounts of the 
annual fees, for each type of licensee, established in its fee rule 
each year. One method is ``rebaselining,'' for which the NRC's budget 
is analyzed in detail and budgeted resources are allocated to fee 
classes and categories of licensees. The second method is the ``percent 
change'' method, for which fees are revised based on the percent change 
in the total budget, taking into account other adjustments, such as the 
number of licensees and the projected revenue to be received from part 
170 fees.
    The NRC is proposing to establish revised annual fees for FY 2007 
using the rebaseline method because of significant budget changes in 
the areas of new reactor licensing and homeland security. As explained 
in the FY 2006 final fee rule, the Commission has determined that the 
agency should proceed with a presumption in favor of rebaselining in 
calculating annual fees each year, and that the percent change method 
should be used infrequently. This is because the Commission expects 
that most years there will be budget and other changes that warrant the 
use of the rebaseline method.
    Rebaselining fees results in increased annual fees compared to FY 
2006 for two classes of licenses (power reactors and non-power 
reactors), and decreased annual fees for five classes of licenses 
(spent fuel storage/reactor decommissioning, fuel facilities, uranium 
recovery, rare earth, and transportation). Within the materials users 
fee class, annual fees for most of the categories (sub-classes) of 
licenses decrease, while annual fees for some increase or remain the 
same.
    The most significant factors affecting the changes to the annual 
fee amounts are the increase in budgeted resources for new reactor 
activities, and the removal of generic homeland security resources from 
the fee base in accordance with the Energy Policy Act of 2005. The 
NRC's total fee recoverable budget, as mandated by law, is 
approximately $40 million larger in FY 2007 as compared to FY 2006. 
Because much of this increase is for the additional workload demand in 
the area of new reactor licensing, this increase mainly affects the 
reactor annual fees. Other factors affecting all annual fees include 
adjustments in the distribution of budgeted costs to the different 
classes of licenses (based on the specific activities NRC will perform 
in FY 2007) and the estimated part 170 collections for the various 
classes of licenses. The percentage of the NRC's budget not subject to 
fee recovery remained unchanged at ten percent from FY 2006 to FY 2007.
    Table V shows the rebaselined annual fees for FY 2007 for a 
representative list of categories of licenses. The FY 2006 fee is also 
shown for comparative purposes.

              Table V.--Rebaselined Annual Fees for FY 2007
------------------------------------------------------------------------
                                              FY 2006         FY 2007
       Class/category of licenses           Annual Fee      Annual Fee
------------------------------------------------------------------------
Operating Power Reactors (including           $3,704,000      $4,088,000
 Spent Fuel Storage/Reactor
 Decommissioning annual fee)............
Spent Fuel Storage/Reactor                       173,000         150,000
 Decommissioning........................
Test and Research Reactors (Non-power             80,100          92,300
 Reactors)..............................
High Enriched Uranium Fuel Facility.....       5,420,000       4,451,000
Low Enriched Uranium Fuel Facility......       1,596,000       1,345,000
UF6 Conversion Facility.................       1,046,000         881,000
Conventional Mills......................          65,900          35,700
Typical Materials Users:
    Radiographers.......................          15,400          14,100
    Well Loggers........................           4,800           4,300
    Gauge Users (Category 3P)...........           2,900           2,700
    Broad Scope Medical.................          33,000          28,800
------------------------------------------------------------------------

    The budgeted costs allocated to each class of licenses and the 
calculations of the rebaselined fees are described in paragraphs a. 
through h. below. The work papers which support this rule show in 
detail the allocation of NRC's budgeted resources for each class of 
licenses and how the fees are calculated. The reports included in these 
work papers summarize the FY 2007 budgeted FTE and contract dollars 
allocated to each fee class and surcharge category at the planned 
activity and program level, and compare these allocations to those used 
to develop final FY 2006 fees. The work papers are available 
electronically at the NRC's Electronic Reading Room on the Internet at 
Web site address https://www.nrc.gov/reading-rm/adams.html. During the 
30-day public comment period, the work papers may also be examined at 
the NRC Public Document Room located at One White Flint North, Room O-
1F22, 11555 Rockville Pike, Rockville, MD 20852-2738.
    a. Fuel Facilities. The FY 2007 budgeted cost to be recovered in 
the annual fees assessment to the fuel facility class of licenses 
[which includes licensees in fee categories 1.A.(1)(a), 1.A.(1)(b), 
1.A.(2)(a), 1.A.(2)(b), 1.A.(2)(c), 1.E., and 2.A.(1), under Sec.  
171.16] is approximately $20.6 million. This value is derived based on 
the full cost of budgeted