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Safety Light Corporation (the Licensee or SLC) is the holder of two Byproduct Material Licenses issued by the Nuclear Regulatory Commission (NRC or Commission) pursuant to 10 CFR part 30 for the facility at 4150-A Old Berwick Road near Bloomsburg, Pennsylvania. License No. 37-00030-02 authorizes the Licensee to characterize and decommission its contaminated facilities, equipment, and land. License No. 37-00030-08 authorizes, among other things, the Licensee to manufacture self-luminous signs and foils using tritium. The licenses were last renewed on December 28, 1999, and are due to expire on December 31, 2004.
On December 28, 1999, License Nos. 37-00030-02 and 37-00030-08 were renewed. As part of these renewals, License Conditions were included that exempted the Licensee from certain of the Commission's financial assurance requirements and required the Licensee to develop plans which would address the License Termination Rule (10 CFR part 20, subpart E). This exemption was granted in response to the Licensee's request to the Commission to exempt the Licensee from the financial assurance decommissioning requirements set forth in 10 CFR 30.32 and 10 CFR 30.35, based on the lack of sufficient funds available at the time to assure that adequate financial ability existed to decommission the facility. In lieu of complying with 10 CFR 30.35, the Licensee committed to (1) develop a schedule and plan, for NRC review and approval, for additional site characterization and to develop revised cost estimates including strategies for site decommissioning that would comply with the criteria specified in the license termination rule, 10 CFR 30.36, and (2) contribute specified monthly payments ($7,000 per month in 2000; $8,000 per month in 2001 and 2002; and $9,000 per month in 2003 and 2004) to a decommissioning trust fund over the life of the license to support decommissioning activities. The NRC specifically approved an exemption, in Condition 16 of Amendment No. 51 for License 37-00030-02 and Condition 20.A of Amendment No. 13 for License 37-00030-08, provided that the licensee make the specified monthly payments into a decommissioning trust fund. The NRC granted the renewal of the two licenses based on the Licensee's continued ability to provide sufficient remediation funding and adequate security of radioactive materials at the facility.
On November 21, 2003, the NRC learned, during telephone conversations with Licensee management, that the Licensee had not made all payments into its decommissioning trust fund, as required by Condition 16 (License No. 37-00030-02) and Condition 20.A (License No. 37-00030-08). The Licensee failed to make several prescribed deposits into the decommissioning trust fund over the period from May 2001 to December 2002. The Licensee made all overdue payments by February 2003 to address the deficit that existed at the end of 2002. However, starting in January 2003, the Licensee again failed to make the total prescribed payments into the decommissioning trust fund, resulting in a deficit of $81,000 by the end of November 2003.
Upon learning of the foregoing, on December 19, 2003, the NRC issued a Demand for Information to SLC which required the Licensee to submit to the NRC the following information:
1. Detailed schedule for making all overdue payments, with interest, to the decommissioning trust fund;
2. Reasons why the Licensee did not make the required payments, as scheduled, to the decommissioning trust fund;
1. Reasons why the NRC should have confidence that the Licensee will, in the future, make the required monthly deposits to the decommissioning trust fund;
2. Assurance from the Licensee, that, should it encounter any difficulty making required monthly deposits in the future, it will promptly notify the NRC that there will be a delay in making a specific deposit, and provide the reasons for the delay;
3. Reasons why the NRC should have confidence that in the future, the Licensee will adhere to license conditions and applicable NRC requirements;
4. Reasons why, in light of the Licensee's past failure to make all required payments to the trust fund, License Nos. 37-00030-02 and 37-00030-08 should not be modified, suspended, or revoked.
On January 16, 2004, the Licensee responded to the Demand for Information and indicated, in part, that the Licensee could not submit a detailed schedule for making overdue payments given the Licensee's inability to Start Printed Page 3071accurately predict future sales and cash flow. The Licensee also indicated that a slowdown in the Licensee's business activity caused by a general economic downturn made it impossible to stay current with the Licensee's payment obligations. At the same time, the Licensee indicated that aggressive marketing efforts, along with an improving economy, led to an increase in order activity which it expected to translate into an upturn in business.
The Licensee made all of the prescribed deposits from December 2003 through November 2004. In addition, the Licensee made payments of amounts in arrears in December 2003, February 2004, and October 2004, resulting in a deficit of $36,000 plus interest to the decommissioning trust fund as of November 30, 2004.
The Licensee submitted license renewal applications for License Nos. 37-00030-02 and 37-00030-08 on April 22, 2004. As noted in the letter transmitting this Order to the Licensee, the NRC denied the renewal applications based on the Licensee's failure to demonstrate compliance with the requirements of 10 CFR 30.35, as well as the Licensee's violation of several conditions of its licenses, including the failure to make the required monthly payments into the decommissioning trust fund.
The NRC Office of Investigations conducted an investigation into the Licensee's failure to make the required monthly payments to the decommissioning trust fund, and concluded that the Licensee's management had deliberately violated the requirement to make the prescribed payments to the trust fund. In a July 1, 2004 letter, the NRC informed the Licensee of this apparent deliberate violation of the License Conditions and invited the licensee to a predecisional enforcement conference to discuss this matter. At the pre-decisional enforcement conference held on July 20, 2004, SLC management stated that a general downturn in business conditions led to the Licensee's failure to make payments. Nonetheless, the NRC maintains that the violation was deliberate in that the Licensee admitted knowledge of the requirement to make payments to the trust fund, yet failed to do so. The obligation to make the specified payments set forth in the license conditions is unqualified and is not subject to the state of SLC's business conditions, and was material to the granting of an exemption to the Licensee in connection with the renewal of its licenses in 1999. The Licensee's deliberate failure to make the required payments to the trust fund, as required by license conditions 16 and 20.A, voided the exemption from the financial assurance requirements of 10 CFR 30.35, and placed the Licensee in continued violation of these license conditions and 10 CFR 30.35. This deliberate failure by the Licensee has significant health and safety implications in that these regulatory requirements are intended to ensure the availability of adequate funds for characterization, packaging, and disposal of radioactive waste from the Licensee's site.
Based on the Licensee's willful failure to make the required scheduled payments into the decommissioning trust fund as required by its licenses, and the resultant implication for public health and safety, I lack the requisite reasonable assurance that the Licensee's current operations can be conducted under License Nos. 37-00030-02 and 37-00030-08 in compliance with the Commission's requirements and that the health and safety of the public, including the Licensee's employees, will be protected. Therefore, the public health, safety, and interest require that License Nos. 37-00030-02 and 37-00030-08 be suspended and that the Licensee must develop a plan for the orderly shutdown of its licensed activities. Furthermore, pursuant to 10 CFR 2.202, I find that given the willful nature of the violation of Conditions 16 and 20.A. of License Nos. 37-00030-02 and 37-00030-08, respectively, and 10 CFR 30.35, as well as the related effect on public health and safety, this Order shall be immediately effective.
In accordance with 10 CFR 30.36 (b) and (c), these licenses will continue in effect beyond the expiration date with respect to possession of byproduct material until the Commission notifies the Licensee in writing that the licenses are terminated. During this time, the Licensee shall limit actions involving byproduct material to those related to decommissioning and continue to control entry to restricted areas until they are suitable for release in accordance with NRC requirements. The Licensee is not authorized to receive any additional licensed material beyond the license expiration date but shall continue to take such actions as are needed to facilitate the decommissioning of the site, including the processing of the existing inventory of tritium to produce devices for transfer to authorized recipients. These actions are described in Section V below.
Accordingly, pursuant to Sections 81, 161b, 161i, 161o, 182 and 186 of the Atomic Energy Act of 1954, as amended, and the Commission's regulations in 10 CFR 2.202 and 10 CFR part 30, It is hereby ordered, effective immediately, that:
A. License Nos. 37-00030-02 and 37-00030-08 are suspended on January 1, 2005, excepting those activities addressed in the shutdown plan prepared in accordance with item B. below and 10 CFR 30.36(b) and (c), pending further Order.
B. The Licensee shall, by December 20, 2004, submit to the Regional Administrator, Region I, for approval, a plan for the orderly shutdown of its licensed activities over a period beginning on January 1, 2005, to be completed by March 31, 2005. This plan shall include provisions to:
1. Cease receipt of licensed material at the Licensee's Bloomsburg, Pennsylvania site;
2. Process existing inventory of licensed material into finished products for transfer to authorized recipients;
3. Transfer, or maintain in secure storage, the remaining inventory of tritium at the site;
4. Notify SLC customers of exit signs, or other devices containing licensed material, that they may not return these signs or devices to the licensee's Bloomsburg, Pennsylvania facility;
5. Provide continued security for the Licensee's Bloomsburg, Pennsylvania facility to assure safe conditions at the site; and
6. Provide continued heating, electrical power and other utility service.
The Regional Administrator, Region I, may, in writing, relax or rescind this order upon demonstration by the Licensee of good cause.
In accordance with 10 CFR 2.202, the Licensee must, and any other person adversely affected by this Order may, submit an answer to this Order, and may request a hearing on this Order, within 20 days of the date of this Order. Where good cause is shown, consideration will be given to extending the time to request a hearing. A request for extension of time must be made in writing to the Director, Office of Enforcement, U.S. Nuclear Regulatory Commission, Washington, DC 20555, and include a statement of good cause for the extension. The answer may consent to this Order. Unless the answer consents to this Order, the answer shall, in writing and under oath or affirmation, specifically admit or deny each allegation or charge made in this order and set forth the matters of fact and law on which the Licensee or other person adversely affected relies and the reasons as to why the Order should not have been issued. Any answer or request for a hearing shall be submitted to the Secretary, U.S. Nuclear Start Printed Page 3072Regulatory Commission, ATTN: Rulemakings and Adjudications Staff, Washington, DC 20555. Copies of the hearing request also should be sent to the Director, Office of Enforcement, U.S. Nuclear Regulatory Commission, Washington, DC 20555, to the Assistant General Counsel for Materials Litigation and Enforcement at the same address, to the Regional Administrator, NRC Region I, 475 Allendale Road, King of Prussia, Pennsylvania, and to the Licensee. Because of continuing disruptions in delivery of mail to United States Government offices, it is requested that answers and requests for hearing be transmitted to the Secretary of the Commission either by means of facsimile transmission to 301-415-1101 or by e-mail to firstname.lastname@example.org and also to the Office of the General Counsel either by means of facsimile transmission to 301-415-3725 or by e-mail to OGCMailCenter@nrc.gov. If a person other than the Licensee requests a hearing, that person shall set forth with particularity the manner in which his interest is adversely affected by this Order and shall address the criteria set forth in 10 CFR 2.309(d).
If a hearing is requested by the Licensee or a person whose interest is adversely affected, the Commission will issue an Order designating the time and place of any hearing. If a hearing is held, the issue to be considered at such hearing shall be whether this Order should be sustained.
Pursuant to 10 CFR 2.202(c)(2)(i), the Licensee, or any other person adversely affected by this Order, may, in addition to demanding a hearing, at the time the answer is filed or sooner, move the presiding officer to set aside the immediate effectiveness of the Order on the ground that the Order, including the need for immediate effectiveness, is not based on adequate evidence but on mere suspicion, unfounded allegations, or error.
In the absence of any request for hearing, or written approval of an extension of time in which to request a hearing, the provisions specified in Section V above shall be final 20 days from the date of this Order without further order or proceedings. If an extension of time for requesting a hearing has been approved, the provisions specified in Section V shall be final when the extension expires if a hearing request has not been received. A request for hearing shall not stay the immediate effectiveness of this order.Start Signature
For the Nuclear Regulatory Commission.
Dated this 10th day of December 2004.
Margaret V. Federline,
Acting Director, Office of Nuclear Material Safety and Safeguards.
[FR Doc. 05-987 Filed 1-18-05; 8:45 am]
BILLING CODE 7590-01-P