99-26700. Expand Applicability of Part 72 to Holders of, and Applicants for, Certificates of Compliance  

  • [Federal Register Volume 64, Number 199 (Friday, October 15, 1999)]
    [Rules and Regulations]
    [Pages 56114-56128]
    From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
    [FR Doc No: 99-26700]
    
    
    
    [[Page 56113]]
    
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    Part VI
    
    
    
    
    
    Nuclear Regulatory Commission
    
    
    
    
    
    _______________________________________________________________________
    
    
    
    10 CFR Part 72
    
    
    
    Expand Applicability of Part 72 to Holders of, and Applicants for, 
    Certificates of Compliance; Final Rule; NRC Enforcement Policy; 
    Enforcement Action Against Nonlicensees Under 10 CFR Part 72; Notice of 
    Policy Statement; Revision
    
    Federal Register / Vol. 64, No. 199 / Friday, October 15, 1999 / 
    Rules and Regulations
    
    [[Page 56114]]
    
    
    
    NUCLEAR REGULATORY COMMISSION
    
    10 CFR Part 72
    
    RIN 3150-AF93
    
    
    Expand Applicability of Part 72 to Holders of, and Applicants 
    for, Certificates of Compliance
    
    AGENCY: Nuclear Regulatory Commission.
    
    ACTION: Final rule.
    
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    SUMMARY: The Nuclear Regulatory Commission (NRC) is amending its 
    regulations to clarify the obligations of holders of, and applicants 
    for, Certificates of Compliance (CoCs). These amendments will enhance 
    the Commission's ability to take enforcement action against these 
    persons when legally binding requirements are violated. This action 
    will emphasize the safety and regulatory significance associated with 
    violations of the regulations. In addition, a new section identifies 
    recordkeeping and reporting requirements for certificate holders and 
    applicants for a CoC.
    
    EFFECTIVE DATE: This final rule is effective on December 14, 1999.
    
    FOR FURTHER INFORMATION CONTACT: Anthony DiPalo, telephone (301) 415-
    6191, e-mail, ajd@nrc.gov, of the Office of Nuclear Material Safety and 
    Safeguards, U.S. Nuclear Regulatory Commission, Washington, DC 20555-
    0001.
    
    SUPPLEMENTARY INFORMATION:
    
    Background
    
        The Commission's regulations at 10 CFR part 72 were established to 
    provide requirements for the issuance of licenses for the storage of 
    spent nuclear fuel in an independent spent fuel storage installation 
    (ISFSI) (45 FR 74693; November 12, 1980). In 1990, the Commission 
    amended part 72 to include a process for approving the design of spent 
    fuel storage casks and issuance of a CoC (subpart L) and for granting a 
    general license to reactor licensees (subpart K) to use NRC-approved 
    casks for storage of spent nuclear fuel (55 FR 29181; July 18, 1990). 
    In the past, the Commission has experienced performance problems in the 
    areas of design, design control, fabrication and quality control with 
    holders of, and applicants for, a CoC under part 72. When the NRC 
    identifies a failure to comply with part 72 requirements by these 
    persons, the enforcement sanctions available have been limited to 
    administrative actions.
        The NRC Enforcement Policy 1 and its implementing 
    program was established to support the NRC's overall safety mission in 
    protecting public health and safety and the environment. Consistent 
    with this purpose, enforcement actions are used as a deterrent to 
    emphasize the importance of compliance with requirements and to 
    encourage prompt identification and comprehensive correction of the 
    violations. Enforcement sanctions consist of Notices of Violation 
    (NOVs), civil penalties, and orders of various types. In addition to 
    formal enforcement actions, the NRC also uses related administrative 
    actions such as Notices of Nonconformance (NONs), Confirmatory Action 
    Letters, and Demands for Information to supplement its enforcement 
    program. The NRC expects licensees, certificate holders, and applicants 
    for a CoC to adhere to any obligations and commitments that result from 
    these actions and will not hesitate to issue appropriate orders to 
    ensure that these obligations and commitments are met. The nature and 
    extent of the enforcement action are intended to reflect the 
    seriousness of the violation involved. An NOV is a written notice 
    setting forth one or more violations of a legally binding requirement.
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        \1\  NUREG-1600, Revision 1, ``General Statement of Policy and 
    Procedures for NRC Enforcement Actions,'' May 1998 (at 63 FR 26630; 
    May 13, 1998).
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        The Commission published a proposed rule in the Federal Register 
    (63 FR 39526; July 23, 1998). The comment period ended on October 6, 
    1998, and four comment letters were received on the proposed rule.
    
    Discussion
    
        In promulgating subpart L, the NRC intended that selected part 72 
    provisions would apply to spent fuel storage cask certificate holders 
    and applicants for a CoC. For example, Sec. 72.234(b) requires that, as 
    a condition for approval of a CoC, ``[d]esign, fabrication, testing, 
    and maintenance of spent fuel storage casks be conducted under a 
    quality assurance program that meets the requirements of subpart G of 
    this part.'' However, the quality assurance (QA) requirements in 
    subpart G refer only to licensees and applicants for licenses, and not 
    to certificate holders. Further, some subpart L regulations apply 
    explicitly to ``the applicant'' (e.g., Sec. 72.232) or to ``the cask 
    vendor'' (e.g., Sec. 72.234(d)(1)). Some of these provisions are 
    written in the passive voice so that it is not clear who is responsible 
    for meeting the requirement (e.g., Sec. 72.236). Although CoCs are 
    legally binding documents, certificate holders or applicants for a CoC 
    have not clearly been brought within the scope of part 72 requirements. 
    Because the terms ``certificate holder'' and ``applicant for a 
    certificate of compliance'' do not appear in the above-cited part 72 
    regulations, the NRC has not had a clear basis to cite these persons 
    for violations of part 72 requirements in the same way it treats 
    licensees. When the NRC has identified a failure to comply with part 72 
    requirements by these persons, it has issued an NON rather than an NOV.
        Although an NON and an NOV appear to be similar, the Commission 
    prefers the issuance of an NOV because: (1) The issuance of an NOV 
    effectively conveys to both the person violating the requirement and 
    the public that a violation of a legally binding requirement has 
    occurred; (2) the use of graduated severity levels associated with an 
    NOV allows the NRC to effectively convey to both the person violating 
    the requirement and the public a clearer perspective on the safety and 
    regulatory significance of the violation; and (3) violation of a 
    regulation reflects the NRC's conclusion that potential risk to public 
    health and safety could exist.
        Over the last 2 years, the Commission has observed repeated 
    problems with the performance of several certificate holders. These 
    problems have occurred in design, design control, fabrication and 
    corrective action areas. Problems in these areas are typically covered 
    under the QA program. In FY 1996, the NRC staff identified numerous 
    instances when certificate holders and their contractors and 
    subcontractors failed to comply with the requirements of part 72. The 
    Commission has concluded that use of the additional enforcement 
    sanctions, which are available in the NRC Enforcement Policy, is 
    required to address the performance problems that have occurred in the 
    spent fuel storage industry. Therefore, the Commission is revising part 
    72 to explicitly state that certificate holders and applicants for a 
    CoC must comply with part 72 regulations.
    
    Summary of the Proposed Rule Amendments
    
        The following is a summary of the amendments that were discussed in 
    the proposed rule (63 FR 39526; July 23, 1998). This summary does not 
    include changes made in the final rule in response to public comments. 
    A summary of the final amendments is discussed in a separate section in 
    this notice.
    
    [[Page 56115]]
    
    Subpart A--General Provisions
    
    Section 72.2  Scope
    
        The term spent fuel storage cask would be added to paragraph (b) of 
    this section. This is a conforming amendment.
    
    Section 72.3  Definitions
    
        The definitions for spent fuel storage cask, certificate holder, 
    and certificate of compliance would be added to this section. The term 
    spent fuel storage cask would be added to the existing definitions for 
    design bases and structures, systems, and components (SSC) important to 
    safety. The definition for design capacity would be revised to be 
    consistent with the Commission's policy on use of metric units.
    
    Section 72.9  Information Collection Requirements: OMB Approval
    
        This section would be revised as a conforming amendment, because of 
    the addition of new Sec. 72.242.
    
    Section 72.10  Employee Protection and
    
    Section 72.11  Completeness and Accuracy of Information
    
        The terms certificate holder and applicants for a Commission 
    license or a CoC would be added for clarification.
    
    Subpart D--Records, Reports, Inspections, and Enforcement
    
    Section 72.86  Criminal Penalties
    
        Paragraph (b) currently includes those sections under which 
    criminal sanctions are not issued. This paragraph has been revised to 
    delete the reference to Sec. 72.236. This section is being revised to 
    provide that failure to comply with the specific requirements for spent 
    fuel storage cask approval would be subject to the criminal penalty 
    provision of Sec. 223 of the Atomic Energy Act. Similarly, certificate 
    holders and applicants who fail to comply with the new Sec. 72.242 
    (Recordkeeping and reports) would also be subject to criminal 
    penalties. Therefore, Sec. 72.242 will not be included in 
    Sec. 72.86(b).
    
    Subpart G--Quality Assurance
    
    Sections 72.140 Through 72.176
    
        In the proposed rule, the term ``certificate holder and applicants 
    for a CoC and their contractors and subcontractors'' is added, as 
    appropriate, to these sections to define explicitly those 
    responsibilities associated with QA requirements. In 1990, when the 
    Commission added subparts K and L to part 72 to provide a process for 
    approving the design of a spent fuel storage cask, which would be used 
    under a general license, the Commission's intent was that certificate 
    holders and applicants for a CoC follow the QA regulations of part 72. 
    Section 72.234(b) required that activities relating to the design, 
    fabrication, testing, and maintenance of spent fuel storage casks must 
    be conducted under a QA program that meets the requirements of subpart 
    G of part 72. However, the 1990 amendments to part 72 did not amend 
    subpart G to include certificate holders and applicants for a CoC. In 
    addition, other changes have been made to individual sections of 
    subpart G as described below.
        In Sec. 72.140, paragraphs (a) and (b) have been revised to clarify 
    the responsibilities of a certificate holder and a licensee with 
    respect to who is responsible for ensuring that the QA program is 
    properly implemented. Paragraph (c) has been revised to provide 
    milestones for a licensee and a certificate holder when the NRC must 
    approve their QA program. Paragraph (d) has been revised to permit use 
    of an NRC-approved QA program that satisfies the requirements of 
    subpart H to part 71 and subpart G of part 72, as well as an approved 
    program under Appendix B to part 50. The notification requirement in 
    paragraph (d) would be revised to require that the NRC be notified in 
    accordance with the standard notification requirements contained in 
    Sec. 72.4.
        To provide clarity, Sec. 72.142 has been rearranged. The new 
    paragraph (a) has been revised to indicate that all of the persons 
    associated with QA activities for an ISFSI or a spent fuel storage cask 
    (i.e., the licensee, certificate holder, and applicants for a CoC or 
    license, and in the proposed rule their contractors and subcontractors) 
    are responsible for implementation of the QA program.
        In Sec. 72.144 paragraphs (a) and (b), Sec. 72.154 paragraph (b), 
    Sec. 72.162, and Sec. 72.168 paragraph (a), the term spent fuel storage 
    cask has been added to the terms ISFSI and MRS.
    
    Subpart L--Approval of Spent Fuel Storage Casks
    
    Section 72.232  Inspection and Tests
    
        This section has been reformatted by adding a new paragraph (b) and 
    renumbering existing paragraphs (b) and (c). In paragraphs (a), (b), 
    and (c), the term ``applicant'' has been replaced with ``certificate 
    holder and applicant for a CoC.'' In paragraph (d), the term 
    ``applicant'' would be replaced with ``certificate holder and applicant 
    for a CoC.''
        Paragraph (a) has been revised to permit the inspection of the 
    premises and activities related to the design of a spent fuel storage 
    cask as well as to the fabrication and testing of such casks. This 
    change would be made to ensure completeness.
        A new paragraph (b) includes a requirement to permit the inspection 
    of records related to design, fabrication, and testing of spent fuel 
    storage casks. This requirement would make clear the responsibility of 
    certificate holders and applicants for a CoC to permit access to these 
    records. This requirement is similar to the existing inspection and 
    testing regulations in 10 CFR Parts 30, 40, 50, and 70.
    
    Section 72.234  Conditions of Approval
    
        This section has been revised to clarify who is responsible for 
    accomplishing these requirements. The term ``cask vendor'' has been 
    replaced with ``certificate holder.'' The term ``cask user'' has been 
    replaced with ``the licensee using the spent fuel storage cask.'' 
    Although the replacement term in the proposed rule was ``the general 
    licensee using the cask'' because a specific licensee cannot utilize 
    the provisions of subparts K and L, it is conceivable that, in the 
    future, a specific licensee could become a user of a certified cask. 
    Accordingly, the NRC prefers the broader term. A similar change is made 
    in Sec. 72.240 as proposed. Further, edits would be made in 
    Secs. 72.234 and 72.236 to clarify that all references to ``casks'' are 
    references to ``spent fuel storage casks.'' In addition, the acronym 
    ``CoC'' would be used in place of the term ``Certificate of 
    Compliance,'' where appropriate.
    
    Section 72.236  Specific Requirements for Spent Fuel Storage Cask 
    Approval
    
        This section has been revised to clarify who is responsible for 
    accomplishing these requirements. A new sentence would be added at the 
    beginning of this section to specify who has responsibility for 
    ensuring that each of the requirements contained in paragraphs (a) 
    through (m) is met. This section has been reissued as being subject to 
    the criminal penalty provisions of Sec. 223 of the Atomic Energy Act. 
    Applicants for a CoC would not be required to ensure that the 
    requirements of paragraphs (j) and (k) were met because these 
    requirements apply to activities that can only occur after a cask has 
    been fabricated, and an applicant cannot begin fabrication of a cask 
    until a CoC has been issued (see Sec. 72.234(c)).
    
    Section 72.240  Conditions for Spent Fuel Storage Cask Reapproval
    
        This section has been revised to clarify who is responsible for 
    accomplishing these requirements. The
    
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    term ``user of a cask'' has been replaced with ``the licensee using the 
    spent fuel storage cask'' and the term ``cask model'' has been replaced 
    with ``design of a spent fuel storage cask.'' The term ``representative 
    of a cask user'' has been replaced with ``the representative of the 
    licensee using the spent fuel storage cask.'' In addition, the acronym 
    ``CoC'' is used in place of the term ``Certificate of Compliance'' 
    where appropriate.
    
    Section 72.242  Recordkeeping and Reports
    
        This new section identifies recordkeeping and reporting 
    requirements for certificate holders and applicants for a CoC that are 
    not already covered by the regulations in Sec. 72.234(d). This includes 
    records required to be kept by a condition of the CoC or records 
    relating to design changes, nonconformances, QA audits, and corrective 
    actions. Violations of this section are subject to the criminal penalty 
    provisions of Sec. 223 of the Atomic Energy Act of 1954. Paragraphs 
    (a), (b), and (c) are similar to the recordkeeping requirements imposed 
    on licensees in Sec. 72.80 (a), (c), and (d).
        A new requirement has been established in paragraph (d) for 
    certificate holders to submit written reports to the NRC when they 
    identify design or fabrication deficiencies, in structures, systems, 
    and components that are important to safety for spent fuel storage 
    casks that have been delivered to licensees. This requirement would 
    inform the NRC of deficiencies that may affect existing casks and 
    thereby potentially affect public health and safety. This requirement 
    would be similar to the event reporting requirement imposed on 
    licensees in Sec. 72.75(c)(2).
    
    Summary of Public Comments on the Proposed Rule
    
        The NRC received four comment letters on the proposed rule. The 
    commenters included a member of the public, one cask fabricator, and 
    two part 72 certificate holders. Three of the four commenters favored 
    the proposed amendments, and one was opposed. Copies of the public 
    comments are available for review in the NRC Public Document Room, 2120 
    L Street, NW (Lower Level), Washington, DC 20003-1527. One commenter, a 
    member of the public, raised many issues unrelated to this rulemaking 
    (e.g., issues that are being addressed in a separate petition for 
    rulemaking (i.e., PRM-72-3), the NRC Enforcement Policy, the NRC 
    Inspection Program, and NRC oversight of the overall spent fuel storage 
    program). The NRC believes these issues are beyond the scope of this 
    rule.
        A review of the comments and the Commission's responses follow:
        1. Comment: One commenter, a certificate holder, recommended for 
    clarity that in the proposed definition of ``certificate holder'' in 
    Sec. 72.3, the words ``company'' or ``organization'' replace the word 
    ``person,'' because a certificate of compliance is not issued to a 
    specific person.
        Response: The NRC disagrees with the comment. The definition of 
    ``person'' in the rule has the same meaning as ``person'' defined in 
    section 11s. of the Atomic Energy Act of 1954. This definition 
    encompasses a wide range of entities (i.e., individuals, corporations, 
    trusts, government agencies, states, and foreign governments) who may 
    wish to apply for a part 72 license or certificate. Therefore, no 
    change has been made in the final rule.
        2. Comment: One commenter, a certificate holder, agreed that design 
    changes should have appropriate controls. However, the commenter stated 
    that it is not clear whether design changes undertaken by the 
    certificate holder require prior NRC approval. Currently, Sec. 72.48 
    identifies those changes that the licensee may make without prior NRC 
    review, and Sec. 72.70 addresses the licensee's responsibility to 
    update its Safety Analysis Report (SAR). But, the rule does not apply 
    Secs. 72.48 and 72.70 to the certificate holders. The commenter stated 
    that the rule did not address whether prior NRC approval is required 
    for a design change made by a certificate holder that would necessitate 
    a revision of the cask SAR, but would not specifically deviate from the 
    CoC; and how the SAR will be updated to reflect these changes.
        The commenter recommended that the proposed revision of 
    Sec. 72.146(c) needs clarification of when prior NRC approval is 
    required for certificate holders and the means to control changes to 
    the SAR that do not require a change to the CoC. The commenter believed 
    that the most direct method to address this concern is to revise part 
    72 to apply Secs. 72.48 and 72.70 to certificate holders. The commenter 
    recognized that NRC intends to pursue changes to Sec. 72.48 in the 
    future. However, without changes to Secs. 72.48 and 72.70 at this time, 
    the commenter believes that some clarifications are necessary in order 
    to implement the proposed revisions to Sec. 72.146(c).
        Response: The NRC agrees in part with the comment. Revising the 
    proposed rule to add provisions to permit a certificate holder to use 
    the provisions of Sec. 72.48 to make changes to the design of a spent 
    fuel storage cask, without prior NRC approval, is beyond the scope of 
    this rulemaking. However, the Commission has approved a separate final 
    rule on ``Changes, Tests, and Experiments'' (64 FR 53582; October 4, 
    1999) that addresses the issues raised by the commenter. The ``Changes, 
    Tests, and Experiments'' final rule revises Sec. 72.48 to permit a 
    certificate holder to make certain changes to the design of a spent 
    fuel storage cask, without NRC prior approval. The ``Changes, Tests, 
    and Experiments'' final rule also revises the requirements in 
    Sec. 72.70 on licensees in updating their SAR; and adds requirements in 
    a new Sec. 72.248 on certificate holders updating their SARs.
        3. Comment: One commenter, a certificate holder, concurs with 
    proposed changes for clarification, but believes that the imposition of 
    enforcement actions may not be necessary. If the NRC decides that 
    enforcement actions are necessary, then the commenter believes that it 
    should not apply to the subcontractors of certificate holders, because 
    in the commenter's view: (1) It does not seem fair to extend 
    enforcement actions to organizations which do not have a direct 
    regulatory link to the NRC; and (2) subjecting such contractors and 
    subcontractors to enforcement action exposes them to business risks 
    which could cause them to refuse to become contractors and 
    subcontractors of certificate holders or cause them to increase their 
    prices. Another commenter believed that subjecting parties to NRC 
    enforcement actions that have no formal regulatory connection presents 
    severe business risks that have a real cost to small businesses and 
    could prove detrimental to a ``rather small and highly specialized 
    group of fabricators.''
        Response: The NRC agrees with the commenters. The NRC expects that 
    persons involved in the manufacture of a spent fuel storage cask will 
    take full responsibility for their obligations to implement the 
    requirements of the part 72 QA regulations. The NRC has reconsidered 
    and now believes that the imposition of enforcement actions against 
    contractors and subcontractors is not necessary. Section 72.148 
    requires that, to the extent necessary, the licensee, certificate 
    holder, and applicants shall require contractors or subcontractors to 
    provide a QA program consistent with Part 72. Licensees, certificate 
    holders, and applicants are responsible for assuring that their 
    contractors and subcontractors are implementing adequate QA programs. 
    Therefore, the NRC has revised the final
    
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    rule to remove references to contractors and subcontractors.
        4. Comment: One commenter, a certificate holder, raised a concern 
    with the proposed extension of enforcement actions to cover 
    Sec. 72.236. Several paragraphs in this section, such as (a), (i), and 
    (m), contain wording like ``but not limited to'' and ``to the extent 
    practicable'' that the commenter believes are highly subjective. The 
    commenter does not believe that certificate holders should be subject 
    to enforcement actions based on someone's opinion regarding what is 
    practicable.
        Response: The NRC recognizes the use of wording ``but not limited 
    to'' and ``to the extent practicable,'' could be viewed as subjective, 
    when interpreting the regulations; however, the changes to paragraphs 
    (a), (i), and (m) did not change the substance of Sec. 72.236. This 
    wording is regularly used in statutes and regulations and the NRC 
    believes this wording will be reasonably interpreted in enforcement 
    actions.
        5. Comment: One commenter, a member of the public, disagreed with 
    the proposed language in Sec. 72.140(a) stating that she ``* * * did 
    not like the term licensee and certificate holder being simultaneously 
    responsible for implementing the quality assurance (QA) requirements 
    for oversight of contractors and subcontractors activities.'' The 
    commenter was concerned that imposing dual responsibility for the same 
    activity was tantamount to implying that no one was responsible. The 
    commenter believed there needed to be a clear cut line of 
    responsibility to determine what the licensee is actually liable for.
        Response: The NRC disagrees with the comment. The NRC intended that 
    both licensees and CoC holders be held accountable for oversight of 
    their contractor (i.e., fabricator) activities and that this redundant 
    responsibility would ensure that the spent fuel storage casks are 
    manufactured in conformance with the approved design and part 72 QA 
    requirements. The NRC believes that this approach will have an overall 
    positive effect on improving quality in the manufacture of spent fuel 
    storage casks.
        6. Comment: One commenter, a certificate holder, agreed with the 
    proposed change in Sec. 72.140(c)(2) to require certificate holders to 
    obtain NRC approval of its quality assurance program prior to 
    commencing fabrication or testing of a spent fuel storage cask. 
    However, this commenter also noted that Sec. 72.140(d) states that a 
    quality assurance program which satisfies Appendix B to part 50 is 
    acceptable for part 72. The commenter also noted that a certificate 
    holder may have a quality assurance program that has been approved by 
    the NRC under part 71 or approved by the NRC for another part 72 CoC 
    application. The commenter suggested that Sec. 72.140(d) be revised to 
    include a quality assurance program which has been previously approved 
    for part 71 or part 72 as acceptable for new CoC applications under 
    part 72.
        Response: The NRC agrees with the comment. The QA requirements 
    contained in 10 CFR part 50, appendix B; 10 CFR part 71, subpart H; and 
    10 CFR part 72, subpart G, are essentially equivalent. The proposed 
    rule revises Sec. 72.140(c), ``Approval of Programs,'' to expand this 
    paragraph to indicate that a certificate holder must have an NRC-
    approved QA program before commencing fabrication or testing of a spent 
    fuel storage cask. The NRC agrees that the definition of an 
    ``approved'' QA program found in Sec. 72.140(d) should include other 
    NRC-approved QA programs. This final rule is revised to allow for the 
    use of all NRC-approved QA programs as satisfying the requirements of 
    subpart G.
        Additionally, the language in Sec. 72.140(d) is revised to reflect: 
    (1) The recordkeeping requirement in Sec. 72.174; and (2) the current 
    location for submitting information to the NRC in Sec. 72.4. These 
    requirements were added to Sec. 72.140(d) by a different rulemaking 
    (see the final rule entitled ``Miscellaneous Changes to Licensing 
    Requirements for the Independent Storage of Spent Fuel and High-Level 
    Radioactive Waste'' (64 FR 33178; June 22, 1999)). The language in 
    Sec. 72.140(c) and (d) is revised to be consistent with paragraph (b) 
    of this section to indicate that the requirements in these paragraphs 
    apply to a licensee, applicant for a license, certificate holder, and 
    applicant for a certificate, as appropriate.
        7. Comment: One commenter, a member of the public, expressed 
    concern with the NRC's process for issuing exemptions to the 
    requirement in Sec. 72.234(c).
    
        Note: Section 72.234(c) currently prohibits beginning cask 
    fabrication before the NRC issues a Certificate of Compliance.
    
        Response: The NRC believes this comment is beyond the scope of this 
    rulemaking. While Sec. 72.234, ``Conditions for Approval,'' was revised 
    in this rulemaking, no change to paragraph (c) of this section was 
    proposed. Rather, this section was revised to clarify who is 
    responsible for implementing these requirements. The process for 
    granting an exemption to part 72 under the provisions of Sec. 72.7, 
    including Sec. 72.234(c), is adequate. An amendment to Sec. 72.234(c) 
    specifically addressing the issue of beginning cask construction before 
    a CoC is issued is addressed in a different rulemaking currently under 
    development by the NRC staff (see proposed rulemaking on 
    ``Clarification and Addition of Flexibility to Part 72,'' RIN-AG15).
        8. Comment: One commenter, a certificate holder, raised the issue 
    that the added requirement in Sec. 72.242(d) requires a written report 
    when the design or fabrication deficiency affects the ability of 
    structures, systems, and components (SSCs) important to safety to 
    perform their intended safety function. The commenter indicated that an 
    individual SSC may perform more than one function. Some of these may be 
    safety related while other functions may not serve a safety function. 
    As an example, a coating may assist in heat removal as a function 
    important to safety but may also serve as an aesthetic function. For 
    this example, the proposed rule could be interpreted to require a 
    written report addressing a deficiency associated with an aesthetic 
    function, even though the particular component would be capable of 
    performing its safety function. It would be an unwarranted use of 
    industry and NRC resources to report deficiencies that do not affect a 
    safety function. The commenter further raised the issue that the 
    deficiency may affect the safety function of such SSCs, but the 
    deficiency may not prevent such structure, system, or component from 
    performing its intended safety function. As an example, a deficiency in 
    a coating may be discovered such that the manufacturer lowers its peak 
    heat transfer rating. However, the cask design as stated in the Safety 
    Analysis Report may not rely upon such a high rating. It also would be 
    an unwarranted use of industry and NRC resources to report deficiencies 
    that do not affect the ability of the component to perform its intended 
    safety function. The commenter suggested revising Sec. 72.242(d) to 
    read as follows: ``* * *deficiency affects the ability of structures, 
    systems, and components important to safety to perform their intended 
    safety function,'' (emphasis in original).
        Response: The NRC agrees with the comment and the final rule has 
    been revised to incorporate the comment.
        9. Comment: One commenter, a cask fabricator, had two objections to 
    the proposed rule. First, the commenter was opposed to the potential 
    for issuance of NOVs and civil penalties against cask fabricators 
    because they have no
    
    [[Page 56118]]
    
    responsibilities or involvement in developing the design configurations 
    for the various spent fuel packages. Second, the commenter indicated 
    that the proposed changes to Sec. 72.146(a) and (b), ``Design 
    Control,'' were troublesome because, under the current procurement 
    process for spent fuel packages, the commenter believes fabricators are 
    intentionally precluded from the development of front end design and 
    licensing activities. The fabricator currently bases manufacturing 
    planning documentation upon the adequacy of a customer provided 
    specification package. The commenter indicated that the fabricator may 
    or may not utilize customer provided drawings for manufacture and that 
    where the fabricator generates the drawings the designer and/or 
    licensee might require their review and approval, but that there is no 
    accepted industry practice on this matter.
        Response: The NRC agrees that contractors and subcontractors need 
    not be included within the scope of the changes made in the final rule. 
    See the response to comment number 3. Licensees and certificate holders 
    are responsible for QA requirements through their oversight of 
    contractors and subcontractors, and fabricators are generally 
    contractors or subcontractors. However, if the contract calls for the 
    fabricator to build according to a design provided by the certificate 
    holder, the NRC expects the fabricator to do just that. The NRC needs 
    assurance that the spent fuel storage casks are manufactured in 
    accordance with the NRC approved design and will hold licensees and 
    certificate holders and applicants responsible for meeting design and 
    QA requirements. Regarding the commenter's concern on the subject of 
    the use of civil penalties; i.e., whether a civil penalty is the 
    appropriate response to a violation of part 72, the NRC notes that this 
    rulemaking does not provide authority for issuing a civil penalty to 
    nonlicensees, other than under the Deliberate Misconduct Rule. The 
    final rule does allow the use of issuance of NOV's or Orders, rather 
    than administrative sanctions.
        10. Comment: One commenter, a certificate holder, while agreeing 
    with the purpose of the proposed rulemaking, raised a concern with the 
    added requirement that identifies additional recordkeeping and 
    reporting requirements for certificate holders. The NRC estimated the 
    burden associated with these new requirements in the Paperwork 
    Reduction Act Statement provided with the Supplementary Information in 
    the proposed rule as 6 hours annually. The commenter notes that the 
    annual burden for recordkeeping and reporting proposed by the revised 
    part 72 would far exceed 6 hours annually. The estimate of 6 hours for 
    annual training would be sufficient to address the training of 
    personnel to implement these new requirements but would not be 
    sufficient to address the actual recordkeeping and reporting. Of 
    course, the actual burden any individual certificate holder would incur 
    because of the required recordkeeping and reporting would vary by 
    certificate holder. This commenter believes that the estimated burden 
    is greater than 100 hours annually but believes that the purpose of the 
    final rule justifies this burden.
        Response: The NRC agrees with the comment. The NRC has reevaluated 
    the recordkeeping and reporting burden estimated for Sec. 72.242 and 
    concluded that the commenter's estimate of 100 hours annually is 
    reasonable. The NRC has verified with the Office of Management and 
    Budget (OMB) that burden increase is an extremely small percentage 
    increase of the present total 21,454-hour burden for part 72.
    
    Summary of Final Amendments
    
        The amended sections listed below have not changed from the 
    proposed rule and are included in the final rule, some editorial 
    changes to improve the organization and readability of the existing 
    language have also been made. These are: Secs. 72.2, 72.3, 72.9, 72.10, 
    72.86, 72.234, 72.236, 72.240, and 72.242(a), (b), and (c).
        In the final rule, Secs. 72.140, 72.142, 72.144, 72.146, 72.148, 
    72.150, 72.152, 72.154, 72.156, 72.158, 72.160, 72.162, 72.164, 72.168, 
    72.170, 72.172, 72.174, 72.176, and 72.232 have been revised in 
    response to comments, and the terms ``contractor and subcontractor'' 
    are removed. However, this action has not been taken in Sec. 72.10 and 
    Sec. 72.148, in part, because the current regulation contains those 
    terms.
        Additionally, in Sec. 72.148, text at the end of the first sentence 
    in the current regulation was inadvertently omitted in the proposed 
    rule. It has been restored and will read as follows: ``* * * for 
    procurement of material, equipment, and services, whether purchased by 
    the licensee, certificate holder, or by their contractors and 
    subcontractors.'' (emphasis added)
        In Sec. 72.140 of the final rule, paragraphs (c) and (d) are 
    revised in response to comments received on the proposed rule as 
    follows:
        Section 72.140 (c) and (d): The QA requirements contained in 10 CFR 
    part 50, appendix B; 10 CFR part 71, subpart H; and 10 CFR part 72, 
    subpart G, are essentially equivalent. The proposed rule revised 
    Sec. 72.140(c), ``Approval of Programs,'' to expand this paragraph to 
    indicate that a certificate holder must have an NRC-approved QA program 
    before commencing fabrication or testing of a spent fuel storage cask. 
    The NRC agrees that the definition of an ``approved'' QA program found 
    in Sec. 72.140(d) should include all other NRC-approved QA programs. 
    The final rule is revised to allow for the use of all NRC-approved QA 
    programs as satisfying the requirements of Subpart G. Additionally, the 
    language in Sec. 72.140(d) is revised to reflect the recordkeeping 
    requirement in Sec. 72.174 and the address for submitting information 
    in Sec. 72.4, which were added to this section by a different 
    rulemaking (see Miscellaneous Changes to Licensing Requirements for the 
    Independent Storage of Spent Fuel and High-Level Radioactive Waste (see 
    64 FR 33178; June 22, 1999). The language in Sec. 72.140(c) and (d) is 
    revised to be consistent with paragraph (b) of this section to indicate 
    that the requirements in these paragraphs apply to a licensee, 
    applicant for a license, certificate holder, and applicant for a 
    certificate, as appropriate.
        In the final rule, Sec. 72.242(d) is modified to accept the comment 
    that written reports should be made when a design or fabrication 
    deficiency affects the ability of SSCs important to safety to perform 
    their intended safety function.
    
    Criminal Penalties
    
        For the purposes of Section 223 of the Atomic Energy Act (AEA), the 
    Commission is issuing the final rule to amend 10 CFR part 72: 
    Sec. 72.10, 72.11, 72.140 through 72.176, 72.232, 72.234, 72.236, and 
    72.242, under one or more of sections 161b, 161i, or 161o of the AEA. 
    Willful violations of the rule would be subject to criminal 
    enforcement.
    
    Agreement State Compatibility
    
        Under the ``Policy Statement on Adequacy and Compatibility of 
    Agreement State Programs'' approved by the Commission on June 30, 1997, 
    and published in the Federal Register on September 3, 1997 (62 FR 
    46517), this rule is classified as compatibility Category ``NRC.'' 
    Compatibility is not required for Category ``NRC'' regulations. The NRC 
    program elements in this category are those that relate directly to 
    areas of regulation reserved to the NRC by the AEA or the provisions of 
    Title 10 of the Code of Federal Regulations, and although an Agreement
    
    [[Page 56119]]
    
    State may not adopt program elements reserved to NRC, it may wish to 
    inform its licensees of certain requirements via a mechanism that is 
    consistent with the particular State's administrative procedure laws, 
    but does not confer regulatory authority on the State.
    
    Voluntary Consensus Standards
    
        The National Technology Transfer Act of 1995 (Public Law 104-113) 
    requires that Federal agencies use technical standards that are 
    developed or adopted by voluntary consensus standards bodies unless the 
    use of such a standard is inconsistent with applicable law or otherwise 
    impractical. In this final rule, the NRC is expanding the applicability 
    of Part 72 to holders of, and applicants for, certificates of 
    compliance, and a voluntary consensus standard is not applicable.
    
    Environmental Impact: Categorical Exclusion
    
        The NRC has determined that this final rule is the type of action 
    described as a categorical exclusion in 10 CFR 51.22(c)(2) and (3). 
    Therefore, neither an environmental impact statement nor an 
    environmental assessment has been prepared for this final rule.
    
    Paperwork Reduction Act Statement
    
        This final rule increases the burden on licensees by expanding the 
    applicability of part 72 to holders of, and applicants for, 
    Certificates of Compliance. The public burden for this information 
    collection is estimated to average 100 hours annually. Because the 
    burden for this information collection is insignificant by comparison 
    with current part 72's overall burden, Office of Management and Budget 
    (OMB) clearance is not required. Existing requirements were approved by 
    the OMB approval number 3150-0132.
    
    Public Protection Notification
    
        If a means used to impose an information collection does not 
    display a currently valid OMB control number, the NRC may not conduct 
    or sponsor, and a person is not required to respond to, the information 
    collection.
    
    Regulatory Analysis
    
    Statement of the Problem
    
        The Commission's regulations at 10 CFR part 72 were designed to 
    provide specific licensing requirements for the storage of spent 
    nuclear fuel in an independent spent fuel storage installation (ISFSI) 
    (45 FR 74693; November 12, 1980). These requirements were later amended 
    to include the storage of high-level waste (HLW) at a monitored 
    retrieval storage (MRS) installation. In 1990, the Commission amended 
    part 72 to include a process for approving the design of spent fuel 
    storage casks by issuance of a certificate of compliance (subpart L) 
    and for granting a general license to reactor licensees (subpart K) to 
    use NRC-approved casks for storage of spent nuclear fuel (55 FR 29181; 
    July 18, 1990). In the past, the Commission experienced performance 
    problems in design, design control, fabrication and quality control 
    with holders of, and applicants for, a CoC under part 72.
        When the NRC identifies a failure to comply with part 72 
    requirements by these persons, the NRC has issued Notices of 
    Nonconformance (NONs). The issuance of an NON does not effectively 
    convey that a violation of a legally binding requirement has occurred. 
    Because the current regulations do not clearly impose requirements on 
    these persons, the NRC has not taken enforcement action, such as a 
    Notice of Violation (NOV), against certificate holders and applicants.
        Some part 72 provisions for cask storage of spent fuel (e.g., the 
    quality assurance (QA) requirements) were intended to apply to cask 
    certificate holders and applicants for cask CoCs, as well as to holders 
    of licenses and applicants for a license to store spent nuclear fuel at 
    an ISFSI. However, some of the part 72 requirements intended to apply 
    to certificate holders and applicants do not clearly bring these 
    persons within the scope of the requirement. For this reason, the NRC 
    has not had a clear basis to cite certificate holders and applicants 
    for a CoC for violations of those part 72 requirements.
        Additionally, broader requirements for recordkeeping and reporting 
    for certificate holders and applicants for a CoC to include records 
    required to be kept by a condition of the CoC, are needed. Therefore, 
    the NRC is adding Sec. 72.242. This will provide an enforcement basis 
    equivalence to the recordkeeping and reporting regulations for 
    licensees (Sec. 72.80).
    
    Purpose of the Rulemaking
    
        The purpose of this rulemaking is to expand the applicability of 
    part 72 to holders of, and applicants for, CoCs. This would allow the 
    NRC staff to take enforcement action in the form of NOVs or orders, 
    rather than administrative action in the form of an NON when 
    requirements are violated. While it may appear that an NON and an NOV 
    are similar, the NRC believes that the issuance of an NOV is preferred 
    because: (1) The issuance of an NOV effectively conveys to both the 
    person violating the requirement and the public that a violation of a 
    legally binding requirement has occurred; (2) the use of graduated 
    severity levels associated with an NOV allows the NRC to effectively 
    convey to both the person violating the requirement and the public a 
    clearer perspective on the safety and regulatory significance of the 
    violation; and (3) violation of a regulation reflects the NRC's 
    conclusion that potential risk to public health and safety could exist.
    
    Current Regulatory Framework and Proposed Changes
    
        In promulgating subpart L, the NRC intended that selected part 72 
    provisions would apply to cask certificate holders and applicants for a 
    CoC. For example, Sec. 72.234(b) requires that, as a condition for 
    approval of a CoC, ``[d]esign, fabrication, testing, and maintenance of 
    spent fuel storage casks be conducted under a QA program that meets the 
    requirements of subpart G of this part.'' However, the QA requirements 
    in subpart G refer only to licensees and applicants for licenses and 
    not to certificate holders. Some of the subpart L regulations apply 
    explicitly only to ``the applicant'' (e.g., Sec. 72.232), or to ``the 
    cask vendor'' (e.g., Sec. 72.234(d)(1)). Some are written in the 
    passive voice so that it is not clear who is responsible for meeting 
    the requirement (e.g., Sec. 72.236). Because of these regulatory 
    deficiencies, certificate holders or applicants for a CoC have not 
    clearly been brought within the scope of part 72 requirements, and the 
    NRC has not had a clear basis to cite these persons for violations of 
    part 72 requirements. Presently, when the NRC has identified a failure 
    to comply with part 72 requirements by these persons, it has issued an 
    administrative action under the NRC's Enforcement Policy.
        The NRC Enforcement Policy and implementing program have been 
    established to support the NRC's overall safety mission in protecting 
    public health and safety and the environment. Consistent with this 
    purpose, enforcement actions are intended to be used as a deterrent to: 
    (1) Emphasize the importance of compliance with requirements; and (2) 
    encourage prompt identification and comprehensive correction of the 
    violations. Enforcement sanctions consist of NOVs, civil penalties, and 
    orders of various types. In addition to the formal enforcement actions, 
    the NRC also uses related administrative actions such as NONs, 
    Confirmatory Action Letters, and Demands for Information to supplement 
    the NRC's enforcement program. The NRC expects licensees and holders 
    of, and applicants for, a CoC to adhere to
    
    [[Page 56120]]
    
    any obligations and commitments resulting from these actions and will 
    not hesitate to issue appropriate orders to ensure that these 
    obligations and commitments are met. The nature and extent of the 
    enforcement action is intended to reflect the seriousness of the 
    violation involved.
        This rule revises the regulations in part 72 to place explicit 
    requirements on certificate holders and applicants for a CoC. 
    Additionally, terms contained in Subpart L, such as cask user, 
    representative of a cask user, cask model, and cask vendor, have been 
    clarified. Changes are made to Sec. 72.10, ``Employee Protection,'' and 
    Sec. 72.11, ``Completeness and Accuracy of Information,'' to include 
    certificate holders and applicants for a CoC. Section 72.3 is revised 
    to: (1) Incorporate definitions for ``certificate holder,'' 
    ``certificate of compliance,'' and ``spent fuel storage cask''; (2) 
    amend the definitions for ``design bases'' and ``structures, systems, 
    and components important to safety'' to include the term ``spent fuel 
    storage cask''; and (3) amend the definition for ``design capacity'' to 
    be consistent with the NRC's policy on the use of metric units. Section 
    72.236 is revised and reissued as being subject to the criminal penalty 
    provisions of Sec. 223 of the Atomic Energy Act of 1954, and 
    Sec. 72.86(b), ``Criminal Penalties,'' is revised to delete mention of 
    Sec. 72.236 as a conforming change. Section 72.232 is reformatted by 
    adding a new paragraph (b) and renumbering existing paragraphs (b) and 
    (c). The term ``applicant'' is replaced by the term ``certificate 
    holder and applicant for a CoC.'' Requirements to permit inspection of 
    records, premises, and activities related to the design, fabrication, 
    and testing of spent fuel storage casks have been clarified. Lastly, a 
    new Sec. 72.242 is added to subpart L to address additional 
    recordkeeping and reporting requirements for certificate holders and 
    applicants for a CoC, in addition to those already required by 
    Sec. 72.234(d). This new section is similar to the requirements imposed 
    on licensees in Sec. 72.80.
    
    Alternatives
    
        This regulatory analysis considered three alternatives:
    
    Alternative 1: Revise part 72 to expand the applicability of certain 
    provisions to certificate holders, applicants for a CoC, and their 
    contractors and subcontractors.
    
        The NRC believes that problems in the areas of quality assurance, 
    quality control, fabrication control, and design control exist, are 
    significant, and, in part, reflect the fact that certificate holders 
    and applicants, and their contractors and subcontractors, have not been 
    explicitly included in certain part 72 requirements despite the NRC's 
    intent that these persons follow these requirements. Contractors and 
    subcontractors actually accomplish the manufacturing and testing of 
    spent fuel storage casks.
        Alternative 1 would allow the NRC to issue NOV's or orders against 
    these persons, as necessary, by allowing the issuance of an NOV when 
    they fail to comply with the requirements of part 72. Presently the NRC 
    issues an NON in these instances.
        The NRC has estimated that each certificate holder or applicant for 
    a CoC, on average, has three contractors and subcontractors. 
    Consequently, the NRC estimates that a total of 60 contractors and 
    subcontractors would be affected by changes to part 72 described in 
    Alternative 1. Because certificate holders, applicants for a CoC, and 
    their contractors and subcontractors, for the most part, have already 
    been meeting the requirements of part 72 as either a condition of a CoC 
    or as a condition of a contract between a certificate holder and its 
    contractors and subcontractors, the burdens imposed by this alternative 
    are not significantly increased.
        The NRC believes that Alternative 1 would have enabled the NRC to 
    make more effective use of the Enforcement Policy against the 
    certificate holders, and their contractors and subcontractors of spent 
    fuel storage casks. However, holding contractors and subcontractors 
    responsible as contemplated by the proposed rule would dilute the 
    message that the Commission's regulations would otherwise make clear--
    that licensees and certificate holders are ultimately responsible for 
    assuring quality. Furthermore, the current regulations in Sec. 72.148 
    make clear that ``[t]o the extent necessary, the licensee shall require 
    contractors or subcontractors to provide a quality assurance program 
    consistent with the applicable provisions of this subpart [Subpart 
    G].''
    
    Alternative 2: Revise part 72 to expand the applicability of certain 
    provisions to certificate holders and applicants for a CoC.
    
        The difference between Alternatives 1 and 2 is that the latter does 
    not include contractors and subcontractors in clarifying the 
    responsibilities for compliance with part 72. Therefore, the NRC would 
    not issue NOVs or orders against these persons under this alternative 
    but would continue to use administrative actions. Several comments were 
    received that were opposed to adding contractors and subcontractors to 
    the regulations. Overall, the commenters felt this action was 
    unnecessary and an excessive burden on small entities. The proposed 
    rule to extend NRC's regulatory requirements under part 72, subpart G, 
    to contractors and subcontractors would be inconsistent with the way in 
    which the NRC regulates quality assurance in other arenas, including 
    reactor parts and equipment. In both instances, there is a potential 
    that deficiencies in the quality assurance program could lead to safety 
    related problems. However, NRC's longstanding regulatory approach has 
    been to make it clear that licensees are responsible for ensuring that 
    the parts and equipment are safe.
        Therefore, the NRC has reconsidered and concluded that contractors 
    and subcontractors should not be included in these regulations. 
    Consequently, Alternative 2 is adopted.
    
    Alternative 3: No action.
    
        This alternative was rejected, even though staff resources for 
    rulemaking would have been conserved. Under this alternative, it is 
    expected that the difficulties the NRC has observed in the past will 
    continue.
    
    Decision Rationale for Preferred Alternative
    
        Alternative 2 is the preferred choice. The major benefit of this 
    alternative is to allow the NRC to issue NOVs or Orders against 
    certificate holders and applicants for a CoC under the current NRC 
    Enforcement Policy, without imposing an unnecessary burden on 
    contractors and subcontractors; and ensures that quality assurance 
    requirements imposed on contractors and subcontractors are consistent 
    for both reactor and material activities. This would enable both the 
    person violating the regulation and the public to clearly perceive the 
    regulatory and safety significance and consequences of the violation.
        Because certificate holders and applicants for a CoC, for the most 
    part, already have been meeting the requirements of part 72 as a 
    condition of a CoC, the burdens imposed by this amendment are not 
    significantly increased. Additional requirements for recordkeeping and 
    reporting for certificate holders are needed, to include records 
    required to be kept by a condition of the CoC. This will provide an 
    enforcement basis equivalence to the recordkeeping and reporting 
    regulations for licensees (Sec. 72.80). Therefore, the NRC is adding 
    Sec. 72.242. The new Sec. 72.242 will add
    
    [[Page 56121]]
    
    new burdens for recordkeeping and reporting requirements. The staff 
    estimates this burden associated with the new Sec. 72.242 to be 
    approximately 100 hours annually. This recordkeeping and reporting 
    burden will vary by certificate holders. The NRC believes that the 
    purpose of the final rule justifies this burden on certificate holders. 
    This burden is insignificant by comparison with part 72's overall 
    burden which is in excess of 21,000 hours. In addition, the current 
    backfit regulation in Sec. 72.62 applies only to part 72 licensees and 
    not to holders of, and applicants for, a CoC. This rule adds 
    recordkeeping and reporting requirements for holders of, and applicants 
    for, CoCs. Therefore, a backfit analysis is not required for this rule.
    
    Regulatory Flexibility Certification
    
        In accordance with the Regulatory Flexibility Act of 1980, 5 U.S.C. 
    605(b), the Commission certifies that this final rule will not have a 
    significant economic impact on a substantial number of small entities. 
    The final rule amends the regulations to expand the applicability of 10 
    CFR part 72 to holders of, and applicants for, CoCs. This requirement 
    will enhance the Commission's ability to take enforcement action by 
    issuing NOVs or orders rather than administrative action in the form of 
    NONs when legally binding requirements are violated. The final rule may 
    appear to impose new requirements on some small entities on the 
    assumption that could be a certificate holder or applicant able to 
    qualify as a ``small entity''. However, these entities, for the most 
    part, are already implementing the actions required by the final rule. 
    Therefore, the NRC believes that this amendment will not have a 
    significant economic impact on any such small entity.
    
    Small Business Regulatory Enforcement Fairness Act
    
        In accordance with the Small Business Regulatory Enforcement 
    Fairness Act of 1996, the NRC has determined that this action is not 
    ``a major'' rule and has verified this determination with the Office of 
    Information and Regulatory Affairs, Office of Management and Budget.
    
    Backfit Analysis
    
        The current backfit regulation in Sec. 72.62 applies only to part 
    72 licensees and not to holders of, and applicants for, a CoC. This 
    rule, in any event, adds only reporting and recordkeeping requirements 
    for holders of, and applicants for, CoCs. The Commission has determined 
    that reporting and recordkeeping requirements are not considered 
    backfits even though they may result in changes to procedures. If the 
    reporting or recordkeeping requirements had to meet the standards for a 
    backfit analysis, the Commission would have to find that the 
    information would substantially increase public health or safety or 
    common defense and security without knowing the results of the request. 
    In addition, the existence or non-existence of a record or report 
    usually has no independent safety significance as compared to actions 
    taken by the licensee, certificate holder, or NRC as a result of the 
    information contained in the record or report. It is this resulting 
    action that affects public health and safety or the common defense or 
    security that should be measured under the backfit standard and not the 
    method for obtaining or maintaining the information.
        However, the NRC has prepared a regulatory analysis which sets 
    forth the objectives of the rulemaking changes, the alternatives that 
    were considered, and the expected costs and benefits associated with 
    the rulemaking changes. The NRC regards this analysis as providing for 
    a disciplined approach for evaluating the impacts of the proposed 
    changes, which satisfies the underlying purposes of the backfitting 
    requirements in Sec. 72.62.
    
    List of Subjects in 10 CFR Part 72
    
        Criminal penalties, Manpower training programs, Nuclear materials, 
    Occupational safety and health, Reporting and recordkeeping 
    requirements, Security measures, Spent fuel.
        For the reasons set out in the preamble and under the authority of 
    the Atomic Energy Act of 1954, as amended; the Energy Reorganization 
    Act of 1974, as amended; and 5 U.S.C. 552 and 553, the NRC is adopting 
    the following amendments to 10 CFR part 72.
    
    PART 72--LICENSING REQUIREMENTS FOR THE INDEPENDENT STORAGE OF 
    SPENT NUCLEAR FUEL AND HIGH-LEVEL RADIOACTIVE WASTE
    
        1. The authority citation for part 72 is revised to read as 
    follows:
    
        Authority: Secs. 51, 53, 57, 62, 63, 65, 69, 81, 161, 182, 183, 
    184, 186, 187, 189, 68 Stat. 929, 930, 932, 933, 934, 935, 948, 953, 
    954, 955, as amended; sec. 234, 83 Stat. 444, as amended (42 U.S.C. 
    2071, 2073, 2077, 2092, 2093, 2095, 2099, 2111, 2201, 2232, 2233, 
    2234, 2236, 2237, 2238, 2282); sec. 274, Pub. L. 86-373, 73 Stat. 
    688, as amended (42 U.S.C. 2021); sec. 201, as amended; 202, 206, 88 
    Stat. 1242, as amended; 1244, 1246 (42 U.S.C. 5841, 5842, 5846); 
    Pub. L. 95-601, sec. 10, 92 Stat. 2951 as amended by Pub. L. 102-
    486, sec. 7902, 106 Stat. 3123 (42 U.S.C. 5851); sec. 102, Pub. L. 
    91-190, 83 Stat. 853 (42 U.S.C. 4332); secs. 131, 132, 133, 135, 
    137, 141, Pub. L. 97-425, 96 Stat. 2229, 2230, 2232, 2241; sec. 148, 
    Pub. L. 100-203, 101 Stat. 1330-235 (42 U.S.C. 10151, 10152, 10153, 
    10155, 10157, 10161, 10168).
        Section 72.44(g) also issued under secs. 142(b) and 148(c), (d), 
    Pub. L. 100-203, 101 Stat. 1330-232, 1330-236 (42 U.S.C. 10162(b), 
    10168(c), (d)). Section 72.46 also issued under sec. 189, 68 Stat. 955 
    (42 U.S.C. 2239); sec. 134, Pub. L. 97-425, 96 Stat. 2230 (42 U.S.C. 
    10154). Section 72.96(d) also issued under sec. 145(g), Pub. L. 100-
    203, 101 Stat. 1330-235 (42 U.S.C. 10165(g)). Subpart J also issued 
    under secs. 2(2), 2(15), 2(19), 117(a), 141(h), Pub. L. 97-425, 96 
    Stat. 2202, 2203, 2204, 2222, 2224 (42 U.S.C. 10101, 10137(a), 
    10161(h)). Subparts K and L are also issued under sec. 133, 98 Stat. 
    2230 (42 U.S.C. 10153) and sec. 218(a), 96 Stat. 2252 (42 U.S.C. 
    10198).
    
        2. In Sec. 72.2, paragraph (b) is revised to read as follows:
    
    
    Sec. 72.2  Scope.
    
    * * * * *
        (b) The regulations in this part pertaining to an independent spent 
    fuel storage installation (ISFSI) and a spent fuel storage cask apply 
    to all persons in the United States, including persons in Agreement 
    States. The regulations in this part pertaining to a monitored 
    retrievable storage installation (MRS) apply only to DOE.
    * * * * *
        3. In Sec. 72.3, the definitions of Certificate holder, Certificate 
    of Compliance or CoC, and Spent fuel storage cask or cask are added in 
    alphabetical order, and the definitions of Design bases, Design 
    capacity, and Structures, systems, and components important to safety 
    are revised to read as follows:
    
    
    Sec. 72.3  Definitions.
    
    * * * * *
        Certificate holder means a person who has been issued a Certificate 
    of Compliance by the Commission for a spent fuel storage cask design.
        Certificate of Compliance or CoC means the certificate issued by 
    the Commission that approves the design of a spent fuel storage cask in 
    accordance with the provisions of subpart L of this part.
    * * * * * * *
        Design bases means that information that identifies the specific 
    functions to be performed by a structure, system, or component of a 
    facility or of a spent fuel storage cask and the specific values or
    
    [[Page 56122]]
    
    ranges of values chosen for controlling parameters as reference bounds 
    for design. These values may be restraints derived from generally 
    accepted state-of-the-art practices for achieving functional goals or 
    requirements derived from analysis (based on calculation or 
    experiments) of the effects of a postulated event under which a 
    structure, system, or component must meet its functional goals. The 
    values for controlling parameters for external events include--
        (1) Estimates of severe natural events to be used for deriving 
    design bases that will be based on consideration of historical data on 
    the associated parameters, physical data, or analysis of upper limits 
    of the physical processes involved; and
        (2) Estimates of severe external man-induced events to be used for 
    deriving design bases that will be based on analysis of human activity 
    in the region, taking into account the site characteristics and the 
    risks associated with the event.
        Design capacity means the quantity of spent fuel or high-level 
    radioactive waste, the maximum burn up of the spent fuel in MWD/MTU, 
    the terabequerel (curie) content of the waste, and the total heat 
    generation in Watts (btu/hour) that the storage installation is 
    designed to accommodate.
    * * * * * * *
        Spent fuel storage cask or cask means all the components and 
    systems associated with the container in which spent fuel or other 
    radioactive materials associated with spent fuel are stored in an 
    ISFSI.
    * * * * * * *
        Structures, systems, and components important to safety means those 
    features of the ISFSI, MRS, and spent fuel storage cask whose functions 
    are--
        (1) To maintain the conditions required to store spent fuel or 
    high-level radioactive waste safely;
        (2) To prevent damage to the spent fuel or the high-level 
    radioactive waste container during handling and storage; or
        (3) To provide reasonable assurance that spent fuel or high-level 
    radioactive waste can be received, handled, packaged, stored, and 
    retrieved without undue risk to the health and safety of the public.
        4. Section 72.9 is revised to read as follows:
    
    
    Sec. 72.9  Information collection requirements: OMB approval.
    
        (a) The Nuclear Regulatory Commission has submitted the information 
    collection requirements contained in this part to the Office of 
    Management and Budget (OMB) for approval as required by the Paperwork 
    Reduction Act of 1995 (44 U.S.C. 3501 et seq.). OMB has approved the 
    information collection requirements contained in this part under 
    control number 3150-0132.
        (b) The approved information collection requirements contained in 
    this part appear in Secs. 72.7, 72.11, 72.16, 72.19, 72.22 through 
    72.34, 72.42, 72.44, 72.48 through 72.56, 72.62, 72.70 through 72.82, 
    72.90, 72.92, 72.94, 72.98, 72.100, 72.102, 72.104, 72.108, 72.120, 
    72.126, 72.140 through 72.176, 72.180 through 72.186, 72.192, 72.206, 
    72.212, 72.216, 72.218, 72.230, 72.232, 72.234, 72.236, 72.240, 72.242, 
    72.244, and 72.248.
        5. In Sec. 72.10, the introductory text of paragraph (a), the 
    introductory text of paragraph (c), and paragraphs (c)(1) and (e)(1) 
    are revised to read as follows:
    
    
    Sec. 72.10  Employee protection.
    
        (a) Discrimination by a Commission licensee, certificate holder, an 
    applicant for a Commission license or a CoC, or a contractor or 
    subcontractor of any of these, against an employee for engaging in 
    certain protected activities, is prohibited. Discrimination includes 
    discharge and other actions that relate to compensation, terms, 
    conditions, or privileges of employment. The protected activities are 
    established in section 211 of the Energy Reorganization Act of 1974, as 
    amended, and in general are related to the administration or 
    enforcement of a requirement imposed under the Atomic Energy Act or the 
    Energy Reorganization Act.
    * * * * * * *
        (c) A violation of paragraph (a), (e), or (f) of this section by a 
    Commission licensee, certificate holder, applicant for a Commission 
    license or a CoC, or a contractor or subcontractor of any of these may 
    be grounds for:
        (1) Denial, revocation, or suspension of the license or the CoC.
    * * * * *
        (e)(1) Each licensee, certificate holder, and applicant for a 
    license or CoC must prominently post the revision of NRC Form 3, 
    ``Notice to Employees,'' referenced in 10 CFR 19.11(c). This form must 
    be posted at locations sufficient to permit employees protected by this 
    section to observe a copy on the way to or from their place of work. 
    The premises must be posted not later than 30 days after an application 
    is docketed and remain posted while the application is pending before 
    the Commission, during the term of the license or CoC, and for 30 days 
    following license or CoC termination.
    * * * * *
        6. Section 72.11 is revised to read as follows:
    
    
    Sec. 72.11  Completeness and accuracy of information.
    
        (a) Information provided to the Commission by a licensee, 
    certificate holder, or an applicant for a license or CoC; or 
    information required by statute or by the Commission's regulations, 
    orders, license or CoC conditions, to be maintained by the licensee or 
    certificate holder, must be complete and accurate in all material 
    respects.
        (b) Each licensee, certificate holder, or applicant for a license 
    or CoC must notify the Commission of information identified by the 
    licensee, certificate holder, or applicant for a license or CoC as 
    having, for the regulated activity, a significant implication for 
    public health and safety or common defense and security. A licensee, 
    certificate holder, or an applicant for a license or CoC violates this 
    paragraph only if the licensee, certificate holder, or applicant for a 
    license or CoC fails to notify the Commission of information that the 
    licensee, certificate holder, or applicant for a license or CoC has 
    identified as having a significant implication for public health and 
    safety or common defense and security. Notification must be provided to 
    the Administrator of the appropriate Regional Office within two working 
    days of identifying the information. This requirement is not applicable 
    to information which is already required to be provided to the 
    Commission by other reporting or updating requirements.
        7. In Sec. 72.86, paragraph (b) is revised to read as follows:
    
    
    Sec. 72.86  Criminal penalties.
    
    * * * * *
        (b) The regulations in this part 72 that are not issued under 
    sections 161b, 161i, or 161o for the purposes of section 223 are as 
    follows: Secs. 72.1, 72.2, 72.3, 72.4, 72.5, 72.7, 72.8, 72.9, 72.16, 
    72.18, 72.20, 72.22, 72.24, 72.26, 72.28, 72.32, 72.34, 72.40, 72.46, 
    72.56, 72.58, 72.60, 72.62, 72.84, 72.86, 72.90, 72.96, 72.108, 72.120, 
    72.122, 72.124, 72.126, 72.128, 72.130, 72.182, 72.194, 72.200, 72.202, 
    72.204, 72.206, 72.210, 72.214, 72.220, 72.230, 72.238, 72.240, 72.244, 
    and 72.246.
        8. Subpart G is revised to read as follows:
    
    Subpart G--Quality Assurance
    
    Sec.
    72.140  Quality assurance requirements.
    72.142  Quality assurance organization.
    72.144  Quality assurance program.
    
    [[Page 56123]]
    
    72.146  Design control.
    72.148  Procurement document control.
    72.150  Instructions, procedures, and drawings.
    72.152  Document control.
    72.154  Control of purchased material, equipment, and services.
    72.156  Identification and control of materials, parts, and 
    components.
    72.158  Control of special processes.
    72.160  Licensee and certificate holder inspection.
    72.162  Test control.
    72.164  Control of measuring and test equipment.
    72.166  Handling, storage, and shipping control.
    72.168  Inspection, test, and operating status.
    72.170  Nonconforming materials, parts, or components.
    72.172  Corrective action.
    72.174  Quality assurance records.
    72.176  Audits.
    
    Subpart G--Quality Assurance
    
    
    Sec. 72.140  Quality assurance requirements.
    
        (a) Purpose. This subpart describes quality assurance requirements 
    that apply to design, purchase, fabrication, handling, shipping, 
    storing, cleaning, assembly, inspection, testing, operation, 
    maintenance, repair, modification of structures, systems, and 
    components, and decommissioning that are important to safety. As used 
    in this subpart, ``quality assurance'' comprises all those planned and 
    systematic actions necessary to provide adequate confidence that a 
    structure, system, or component will perform satisfactorily in service. 
    Quality assurance includes quality control, which comprises those 
    quality assurance actions related to control of the physical 
    characteristics and quality of the material or component to 
    predetermined requirements. The certificate holder and applicant for a 
    CoC are responsible for the quality assurance requirements as they 
    apply to the design, fabrication, and testing of a spent fuel storage 
    cask until possession of the spent fuel storage cask is transferred to 
    the licensee. The licensee and the certificate holder are also 
    simultaneously responsible for these quality assurance requirements 
    through the oversight of contractors and subcontractors.
        (b) Establishment of program. Each licensee, applicant for a 
    license, certificate holder, applicant for a CoC shall establish, 
    maintain, and execute a quality assurance program satisfying each of 
    the applicable criteria of this subpart, and satisfying any specific 
    provisions which are applicable to the licensee's, applicant's for a 
    license, certificate holder's, and applicant's for a CoC activities. 
    The licensee, applicant for a license, certificate holder, and 
    applicant for a CoC shall execute the applicable criteria in a graded 
    approach to an extent that is commensurate with the quality assurance 
    requirements' importance to safety. The quality assurance program must 
    cover the activities identified in this subpart throughout the life of 
    the activity. For licensees, this includes activities from the site 
    selection through decommissioning prior to termination of the license. 
    For certificate holders, this includes activities from development of 
    the spent fuel storage cask design through termination of the CoC.
        (c) Approval of program. (1) Each licensee, applicant for a 
    license, certificate holder, and applicant for a CoC shall file a 
    description, in accordance with Sec. 72.4, of its quality assurance 
    program that includes a discussion of which requirements of this 
    subpart are applicable and the methodology used to satisfy these 
    requirements.
        (2) Each licensee shall obtain Commission approval of its quality 
    assurance program prior to receipt of spent fuel at the ISFSI or spent 
    fuel and high-level radioactive waste at the MRS.
        (3) Each certificate holder shall obtain Commission approval of its 
    quality assurance program prior to commencing fabrication or testing of 
    a spent fuel storage cask.
        (d) Previously approved programs. A quality assurance program 
    previously approved by the Commission and which is established, 
    maintained, and executed with regard to an ISFSI or spent fuel storage 
    cask will be accepted as satisfying the requirements of paragraph (b) 
    of this section. Previously approved quality assurance programs that 
    satisfy the requirements of Appendix B to part 50 of this chapter, 
    subpart H of part 71 of this chapter, or subpart G of this part are 
    considered acceptable, except each licensee, applicant for a license, 
    certificate holder, and applicant for a CoC who are using an Appendix B 
    or subpart H quality assurance program shall also meet the 
    recordkeeping requirements of Sec. 72.174. Prior to initial use of a 
    previously approved program, each licensee, applicant for a license, 
    certificate holder, and applicant for a CoC shall notify the NRC, in 
    accordance with Sec. 72.4, of its intent to apply its previously 
    approved quality assurance program to ISFSI or spent fuel storage cask 
    activities. The notification must identify the quality assurance 
    program by date of submittal to the Commission, docket number, and date 
    of Commission approval.
    
    
    Sec. 72.142  Quality assurance organization.
    
        (a) The licensee, applicant for a license, certificate holder, and 
    applicant for a CoC shall be responsible for the establishment and 
    execution of the quality assurance program. The licensee and 
    certificate holder may delegate to others, such as contractors, agents, 
    or consultants, the work of establishing and executing the quality 
    assurance program, but the licensee and the certificate holder shall 
    retain responsibility for the program. The licensee, applicant for a 
    license, certificate holder, and applicant for a CoC shall clearly 
    establish and delineate in writing the authority and duties of persons 
    and organizations performing activities affecting the functions of 
    structures, systems, and components which are important to safety. 
    These activities include performing the functions associated with 
    attaining quality objectives and the quality assurance functions.
        (b) The quality assurance functions are--
        (1) Assuring that an appropriate quality assurance program is 
    established and effectively executed; and
        (2) Verifying, by procedures such as checking, auditing, and 
    inspection, that activities affecting the functions that are important 
    to safety have been correctly performed. The persons and organizations 
    performing quality assurance functions shall have sufficient authority 
    and organizational freedom to identify quality problems; to initiate, 
    recommend, or provide solutions; and to verify implementation of 
    solutions.
        (c) The persons and organizations performing quality assurance 
    functions shall report to a management level that ensures that the 
    required authority and organizational freedom, including sufficient 
    independence from cost and schedule considerations when these 
    considerations are opposed to safety considerations, are provided. 
    Because of the many variables involved, such as the number of 
    personnel, the type of activity being performed, and the location or 
    locations where activities are performed, the organizational structure 
    for executing the quality assurance program may take various forms, 
    provided that the persons and organizations assigned the quality 
    assurance functions have the required authority and organizational 
    freedom. Irrespective of the organizational structure, the 
    individual(s) assigned the responsibility for assuring effective 
    execution of any portion of the quality assurance program, at any 
    location where activities subject to this section are being performed, 
    must have direct
    
    [[Page 56124]]
    
    access to the levels of management necessary to perform this function.
    
    
    Sec. 72.144  Quality assurance program.
    
        (a) The licensee, applicant for a license, certificate holder, and 
    applicant for a CoC shall establish, at the earliest practicable time 
    consistent with the schedule for accomplishing the activities, a 
    quality assurance program which complies with the requirements of this 
    subpart. The licensee, applicant for a license, certificate holder, and 
    applicant for a CoC shall document the quality assurance program by 
    written procedures or instructions and shall carry out the program in 
    accordance with these procedures throughout the period during which the 
    ISFSI or MRS is licensed or the spent fuel storage cask is certified. 
    The licensee, applicant for a license, certificate holder, and 
    applicant for a CoC shall identify the structures, systems, and 
    components to be covered by the quality assurance program, the major 
    organizations participating in the program, and the designated 
    functions of these organizations.
        (b) The licensee, applicant for a license, certificate holder, and 
    applicant for a CoC, through their quality assurance program(s), shall 
    provide control over activities affecting the quality of the identified 
    structures, systems, and components to an extent commensurate with the 
    importance to safety and, as necessary, to ensure conformance with the 
    approved design of each ISFSI, MRS, or spent fuel storage cask. The 
    licensee, applicant for a license, certificate holder, and applicant 
    for a CoC shall ensure that activities affecting quality are 
    accomplished under suitably controlled conditions. Controlled 
    conditions include the use of appropriate equipment; suitable 
    environmental conditions for accomplishing the activity, such as 
    adequate cleanliness; and assurance that all prerequisites for the 
    given activity have been satisfied. The licensee, applicant for a 
    license, certificate holder, and applicant for a CoC shall take into 
    account the need for special controls, processes, test equipment, tools 
    and skills to attain the required quality and the need for verification 
    of quality by inspection and test.
        (c) The licensee, applicant for a license, certificate holder, and 
    applicant for a CoC shall base the requirements and procedures of their 
    quality assurance program(s) on the following considerations concerning 
    the complexity and proposed use of the structures, systems, or 
    components:
        (1) The impact of malfunction or failure of the item on safety;
        (2) The design and fabrication complexity or uniqueness of the 
    item;
        (3) The need for special controls and surveillance over processes 
    and equipment;
        (4) The degree to which functional compliance can be demonstrated 
    by inspection or test; and
        (5) The quality history and degree of standardization of the item.
        (d) The licensee, applicant for a license, certificate holder, and 
    applicant for a CoC shall provide for indoctrination and training of 
    personnel performing activities affecting quality as necessary to 
    ensure that suitable proficiency is achieved and maintained.
        (e) The licensee, applicant for a license, certificate holder, and 
    applicant for a CoC shall review the status and adequacy of the quality 
    assurance program at established intervals. Management of other 
    organizations participating in the quality assurance program must 
    regularly review the status and adequacy of that part of the quality 
    assurance program which they are executing.
    
    
    Sec. 72.146  Design control.
    
        (a) The licensee, applicant for a license, certificate holder, and 
    applicant for a CoC shall establish measures to ensure that applicable 
    regulatory requirements and the design basis, as specified in the 
    license or CoC application for those structures, systems, and 
    components to which this section applies, are correctly translated into 
    specifications, drawings, procedures, and instructions. These measures 
    must include provisions to ensure that appropriate quality standards 
    are specified and included in design documents and that deviations from 
    standards are controlled. Measures must be established for the 
    selection and review for suitability of application of materials, 
    parts, equipment, and processes that are essential to the functions of 
    the structures, systems, and components which are important to safety.
        (b) The licensee, applicant for a license, certificate holder, and 
    applicant for a CoC shall establish measures for the identification and 
    control of design interfaces and for coordination among participating 
    design organizations. These measures must include the establishment of 
    written procedures among participating design organizations for the 
    review, approval, release, distribution, and revision of documents 
    involving design interfaces. The design control measures must provide 
    for verifying or checking the adequacy of design by methods such as 
    design reviews, alternate or simplified calculational methods, or by a 
    suitable testing program. For the verifying or checking process, the 
    licensee and certificate holder shall designate individuals or groups 
    other than those who were responsible for the original design, but who 
    may be from the same organization. Where a test program is used to 
    verify the adequacy of a specific design feature in lieu of other 
    verifying or checking processes, the licensee and certificate holder 
    shall include suitable qualification testing of a prototype or sample 
    unit under the most adverse design conditions. The licensee, applicant 
    for a license, certificate holder, and applicant for a CoC shall apply 
    design control measures to items such as the following: criticality 
    physics, radiation, shielding, stress, thermal, hydraulic, and accident 
    analyses; compatibility of materials; accessibility for inservice 
    inspection, maintenance, and repair; features to facilitate 
    decontamination; and delineation of acceptance criteria for inspections 
    and tests.
        (c) The licensee, applicant for a license, certificate holder, and 
    applicant for a CoC shall subject design changes, including field 
    changes, to design control measures commensurate with those applied to 
    the original design. Changes in the conditions specified in the license 
    or CoC require prior NRC approval.
    
    
    Sec. 72.148  Procurement document control.
    
        The licensee, applicant for a license, certificate holder, and 
    applicant for a CoC shall establish measures to assure that applicable 
    regulatory requirements, design bases, and other requirements which are 
    necessary to assure adequate quality are included or referenced in the 
    documents for procurement of material, equipment, and services, whether 
    purchased by the licensee, certificate holder, or by their contractors 
    and subcontractors. To the extent necessary, the licensee, applicant 
    for a license, certificate holder, and applicant for a CoC, shall 
    require contractors or subcontractors to provide a quality assurance 
    program consistent with the applicable provisions of this subpart.
    
    
    Sec. 72.150  Instructions, procedures, and drawings.
    
        The licensee, applicant for a license, certificate holder, and 
    applicant for a CoC shall prescribe activities affecting quality by 
    documented instructions, procedures, or drawings of a type appropriate 
    to the circumstances and shall require that these instructions, 
    procedures, and drawings be followed. The instructions, procedures, and 
    drawings must include appropriate
    
    [[Page 56125]]
    
    quantitative or qualitative acceptance criteria for determining that 
    important activities have been satisfactorily accomplished.
    
    
    Sec. 72.152  Document control.
    
        The licensee, applicant for a license, certificate holder, and 
    applicant for a CoC shall establish measures to control the issuance of 
    documents such as instructions, procedures, and drawings, including 
    changes, which prescribe all activities affecting quality. These 
    measures must assure that documents, including changes, are reviewed 
    for adequacy, approved for release by authorized personnel, and 
    distributed and used at the location where the prescribed activity is 
    performed. These measures must ensure that changes to documents are 
    reviewed and approved.
    
    
    Sec. 72.154  Control of purchased material, equipment, and services.
    
        (a) The licensee, applicant for a license, certificate holder, and 
    applicant for a CoC shall establish measures to ensure that purchased 
    material, equipment, and services, whether purchased directly or 
    through contractors and subcontractors, conform to the procurement 
    documents. These measures must include provisions, as appropriate, for 
    source evaluation and selection, objective evidence of quality 
    furnished by the contractor or subcontractor, inspection at the 
    contractor or subcontractor source, and examination of products upon 
    delivery.
        (b) The licensee, applicant for a license, certificate holder, and 
    applicant for a CoC shall have available documentary evidence that 
    material and equipment conform to the procurement specifications prior 
    to installation or use of the material and equipment. The licensee and 
    certificate holder shall retain or have available this documentary 
    evidence for the life of the ISFSI, MRS, or spent fuel storage cask. 
    The licensee and certificate holder shall ensure that the evidence is 
    sufficient to identify the specific requirements met by the purchased 
    material and equipment.
        (c) The licensee, applicant for a license, certificate holder, and 
    applicant for a CoC, or a designee of either, shall assess the 
    effectiveness of the control of quality by contractors and 
    subcontractors at intervals consistent with the importance, complexity, 
    and quantity of the product or services.
    
    
    Sec. 72.156  Identification and control of materials, parts, and 
    components.
    
        The licensee, applicant for a license, certificate holder, and 
    applicant for a CoC shall establish measures for the identification and 
    control of materials, parts, and components. These measures must ensure 
    that identification of the item is maintained by heat number, part 
    number, serial number, or other appropriate means, either on the item 
    or on records traceable to the item as required, throughout 
    fabrication, installation, and use of the item. These identification 
    and control measures must be designed to prevent the use of incorrect 
    or defective materials, parts, and components.
    
    
    Sec. 72.158  Control of special processes.
    
        The licensee, applicant for a license, certificate holder, and 
    applicant for a CoC shall establish measures to ensure that special 
    processes, including welding, heat treating, and nondestructive 
    testing, are controlled and accomplished by qualified personnel using 
    qualified procedures in accordance with applicable codes, standards, 
    specifications, criteria, and other special requirements.
    
    
    Sec. 72.160  Licensee and certificate holder inspection.
    
        The licensee, applicant for a license, certificate holder, and 
    applicant for a CoC shall establish and execute a program for 
    inspection of activities affecting quality by or for the organization 
    performing the activity to verify conformance with the documented 
    instructions, procedures, and drawings for accomplishing the activity. 
    The inspection must be performed by individuals other than those who 
    performed the activity being inspected. Examinations, measurements, or 
    tests of material or products processed must be performed for each work 
    operation where necessary to assure quality. If direct inspection of 
    processed material or products cannot be carried out, indirect control 
    by monitoring processing methods, equipment, and personnel must be 
    provided. Both inspection and process monitoring must be provided when 
    quality control is inadequate without both. If mandatory inspection 
    hold points that require witnessing or inspecting by the licensee's or 
    certificate holder's designated representative, and beyond which work 
    should not proceed without the consent of its designated 
    representative, are required, the specific hold points must be 
    indicated in appropriate documents.
    
    
    Sec. 72.162  Test control.
    
        The licensee, applicant for a license, certificate holder, and 
    applicant for a CoC shall establish a test program to ensure that all 
    testing, required to demonstrate that the structures, systems, and 
    components will perform satisfactorily in service, is identified and 
    performed in accordance with written test procedures that incorporate 
    the requirements of this part and the requirements and acceptance 
    limits contained in the ISFSI, MRS, or spent fuel storage cask license 
    or CoC. The test procedures must include provisions to ensure that all 
    prerequisites for the given test are met, that adequate test 
    instrumentation is available and used, and that the test is performed 
    under suitable environmental conditions. The licensee, applicant for a 
    license, certificate holder, and applicant for a CoC shall document and 
    evaluate the test results to ensure that test requirements have been 
    satisfied.
    
    
    Sec. 72.164  Control of measuring and test equipment.
    
        The licensee, applicant for a license, certificate holder, and 
    applicant for a CoC shall establish measures to ensure that tools, 
    gauges, instruments, and other measuring and testing devices used in 
    activities affecting quality are properly controlled, calibrated, and 
    adjusted at specified periods to maintain accuracy within necessary 
    limits.
    
    
    Sec. 72.166  Handling, storage, and shipping control.
    
        The licensee, applicant for a license, certificate holder, and 
    applicant for a CoC shall establish measures to control, in accordance 
    with work and inspection instructions, the handling, storage, shipping, 
    cleaning, and preservation of materials and equipment to prevent damage 
    or deterioration. When necessary for particular products, special 
    protective environments, such as inert gas atmosphere, and specific 
    moisture content and temperature levels must be specified and provided.
    
    
    Sec. 72.168  Inspection, test, and operating status.
    
        (a) The licensee, applicant for a license, certificate holder, and 
    applicant for a CoC shall establish measures to indicate, by the use of 
    markings such as stamps, tags, labels, routing cards, or other suitable 
    means, the status of inspections and tests performed upon individual 
    items of the ISFSI, MRS, or spent fuel storage cask. These measures 
    must provide for the identification of items which have satisfactorily 
    passed required inspections and tests where necessary to preclude 
    inadvertent bypassing of the inspections and tests.
        (b) The licensee shall establish measures to identify the operating 
    status of structures, systems, and components of the ISFSI or MRS, such 
    as tagging
    
    [[Page 56126]]
    
    valves and switches, to prevent inadvertent operation.
    
    
    Sec. 72.170  Nonconforming materials, parts, or components.
    
        The licensee, applicant for a license, certificate holder, and 
    applicant for a CoC shall establish measures to control materials, 
    parts, or components that do not conform to their requirements in order 
    to prevent their inadvertent use or installation. These measures must 
    include, as appropriate, procedures for identification, documentation, 
    segregation, disposition, and notification to affected organizations. 
    Nonconforming items must be reviewed and accepted, rejected, repaired, 
    or reworked in accordance with documented procedures.
    
    
    Sec. 72.172  Corrective action.
    
        The licensee, applicant for a license, certificate holder, and 
    applicant for a CoC shall establish measures to ensure that conditions 
    adverse to quality, such as failures, malfunctions, deficiencies, 
    deviations, defective material and equipment, and nonconformances, are 
    promptly identified and corrected. In the case of a significant 
    condition identified as adverse to quality, the measures must ensure 
    that the cause of the condition is determined and corrective action is 
    taken to preclude repetition. The identification of the significant 
    condition adverse to quality, the cause of the condition, and the 
    corrective action taken must be documented and reported to appropriate 
    levels of management.
    
    
    Sec. 72.174  Quality assurance records.
    
        The licensee, applicant for a license, certificate holder, and 
    applicant for a CoC shall maintain sufficient records to furnish 
    evidence of activities affecting quality. The records must include the 
    following: design records, records of use, and the results of reviews, 
    inspections, tests, audits, monitoring of work performance, and 
    materials analyses. The records must include closely related data such 
    as qualifications of personnel, procedures, and equipment. Inspection 
    and test records must, at a minimum, identify the inspector or data 
    recorder, the type of observation, the results, the acceptability, and 
    the action taken in connection with any noted deficiencies. Records 
    must be identifiable and retrievable. Records pertaining to the design, 
    fabrication, erection, testing, maintenance, and use of structures, 
    systems, and components important to safety must be maintained by or 
    under the control of the licensee or certificate holder until the NRC 
    terminates the license or CoC.
    
    
    Sec. 72.176  Audits.
    
        The licensee, applicant for a license, certificate holder, and 
    applicant for a CoC shall carry out a comprehensive system of planned 
    and periodic audits to verify compliance with all aspects of the 
    quality assurance program and to determine the effectiveness of the 
    program. The audits must be performed in accordance with written 
    procedures or checklists by appropriately trained personnel not having 
    direct responsibilities in the areas being audited. Audited results 
    must be documented and reviewed by management having responsibility in 
    the area audited. Follow-up action, including reaudit of deficient 
    areas, must be taken where indicated.
        9. Section 72.232 is revised to read as follows:
    
    
    Sec. 72.232  Inspection and tests.
    
        (a) The certificate holder and applicant for a CoC shall permit, 
    and make provisions for, the NRC to inspect the premises and facilities 
    where a spent fuel storage cask is designed, fabricated, and tested.
        (b) The certificate holder and applicant for a CoC shall make 
    available to the NRC for inspection, upon reasonable notice, records 
    kept by them pertaining to the design, fabrication, and testing of 
    spent fuel storage casks.
        (c) The certificate holder and applicant for a CoC shall perform, 
    and make provisions that permit the NRC to perform, tests that the 
    Commission deems necessary or appropriate for the administration of the 
    regulations in this part.
        (d) The certificate holder and applicant for a CoC shall submit a 
    notification under Sec. 72.4 at least 45 days prior to starting 
    fabrication of the first spent fuel storage cask under a Certificate of 
    Compliance.
        10. Section 72.234 is revised to read as follows:
    
    
    Sec. 72.234  Conditions of approval.
    
        (a) The certificate holder and applicant for a CoC shall ensure 
    that the design, fabrication, testing, and maintenance of a spent fuel 
    storage cask comply with the requirements in Sec. 72.236.
        (b) The certificate holder and applicant for a CoC shall ensure 
    that the design, fabrication, testing, and maintenance of spent fuel 
    storage casks are conducted under a quality assurance program that 
    meets the requirements of subpart G of this part.
        (c) The certificate holder and applicant for a CoC shall ensure 
    that the fabrication of spent fuel storage casks under a CoC does not 
    begin prior to receipt of the CoC for the spent fuel storage cask.
        (d)(1) The certificate holder shall ensure that a record is 
    established and maintained for each spent fuel storage cask fabricated 
    under the CoC.
        (2) This record must include:
        (i) The NRC CoC number;
        (ii) The spent fuel storage cask model number;
        (iii) The spent fuel storage cask identification number;
        (iv) Date fabrication was started;
        (v) Date fabrication was completed;
        (vi) Certification that the spent fuel storage cask was designed, 
    fabricated, tested, and repaired in accordance with a quality assurance 
    program accepted by NRC;
        (vii) Certification that inspections required by Sec. 72.236(j) 
    were performed and found satisfactory; and
        (viii) The name and address of the licensee using the spent fuel 
    storage cask.
        (3) The certificate holder shall supply the original of this record 
    to the licensees using the spent fuel storage cask. A current copy of a 
    composite record of all spent fuel storage casks manufactured under a 
    CoC, showing the information in paragraph (d)(2) of this section, must 
    be initiated and maintained by the certificate holder for each model 
    spent fuel storage cask. If the certificate holder permanently ceases 
    production of spent fuel storage casks under a CoC, the certificate 
    holder shall send this composite record to the Commission using 
    instructions in Sec. 72.4.
        (e) The certificate holder and the licensees using the spent fuel 
    storage cask shall ensure that the composite record required by 
    paragraph (d) of this section is available to the Commission for 
    inspection.
        (f) The certificate holder shall ensure that written procedures and 
    appropriate tests are established prior to use of the spent fuel 
    storage casks. A copy of these procedures and tests must be provided to 
    each licensee using the spent fuel storage cask.
        11. Section 72.236 is revised to read as follows:
    
    
    Sec. 72.236  Specific requirements for spent fuel storage cask approval 
    and fabrication.
    
        The certificate holder shall ensure that the requirements of this 
    section are met. An applicant for a CoC shall ensure that the 
    requirements of this section are met, except for paragraphs (j) and (k) 
    of this section.
        (a) Specifications must be provided for the spent fuel to be stored 
    in the
    
    [[Page 56127]]
    
    spent fuel storage cask, such as, but not limited to, type of spent 
    fuel (i.e., BWR, PWR, both), maximum allowable enrichment of the fuel 
    prior to any irradiation, burn-up (i.e., megawatt-days/MTU), minimum 
    acceptable cooling time of the spent fuel prior to storage in the spent 
    fuel storage cask, maximum heat designed to be dissipated, maximum 
    spent fuel loading limit, condition of the spent fuel (i.e., intact 
    assembly or consolidated fuel rods), the inerting atmosphere 
    requirements.
        (b) Design bases and design criteria must be provided for 
    structures, systems, and components important to safety.
        (c) The spent fuel storage cask must be designed and fabricated so 
    that the spent fuel is maintained in a subcritical condition under 
    credible conditions.
        (d) Radiation shielding and confinement features must be provided 
    sufficient to meet the requirements in Secs. 72.104 and 72.106.
        (e) The spent fuel storage cask must be designed to provide 
    redundant sealing of confinement systems.
        (f) The spent fuel storage cask must be designed to provide 
    adequate heat removal capacity without active cooling systems.
        (g) The spent fuel storage cask must be designed to store the spent 
    fuel safely for a minimum of 20 years and permit maintenance as 
    required.
        (h) The spent fuel storage cask must be compatible with wet or dry 
    spent fuel loading and unloading facilities.
        (i) The spent fuel storage cask must be designed to facilitate 
    decontamination to the extent practicable.
        (j) The spent fuel storage cask must be inspected to ascertain that 
    there are no cracks, pinholes, uncontrolled voids, or other defects 
    that could significantly reduce its confinement effectiveness.
        (k) The spent fuel storage cask must be conspicuously and durably 
    marked with--
        (1) A model number;
        (2) A unique identification number; and
        (3) An empty weight.
        (l) The spent fuel storage cask and its systems important to safety 
    must be evaluated, by appropriate tests or by other means acceptable to 
    the NRC, to demonstrate that they will reasonably maintain confinement 
    of radioactive material under normal, off-normal, and credible accident 
    conditions.
        (m) To the extent practicable in the design of spent fuel storage 
    casks, consideration should be given to compatibility with removal of 
    the stored spent fuel from a reactor site, transportation, and ultimate 
    disposition by the Department of Energy.
        12. Section 72.240 is revised to read as follows:
    
    
    Sec. 72.240  Conditions for spent fuel storage cask reapproval.
    
        (a) The certificate holder, a licensee using a spent fuel storage 
    cask, or the representative of a licensee using a spent fuel storage 
    cask shall apply for reapproval of the design of a spent fuel storage 
    cask.
        (b) The application for reapproval of the design of a spent fuel 
    storage cask must be submitted not less than 30 days prior to the 
    expiration date of the CoC. When the applicant has submitted a timely 
    application for reapproval, the existing CoC will not expire until the 
    application for reapproval has been determined by the NRC. The 
    application must be accompanied by a safety analysis report (SAR). The 
    new SAR may reference the SAR originally submitted for the approved 
    spent fuel storage cask design.
        (c) The design of a spent fuel storage cask will be reapproved if 
    the conditions in Sec. 72.238 are met, and the application includes a 
    demonstration that the storage of spent fuel has not significantly 
    adversely affected structures, systems, and components important to 
    safety.
        13. Section 72.242 is added to read as follows:
    
    
    Sec. 72.242  Recordkeeping and reports.
    
        (a) Each certificate holder or applicant shall maintain any records 
    and produce any reports that may be required by the conditions of the 
    CoC or by the rules, regulations, and orders of the NRC in effectuating 
    the purposes of the Act.
        (b) Records that are required by the regulations in this part or by 
    conditions of the CoC must be maintained for the period specified by 
    the appropriate regulation or the CoC conditions. If a retention period 
    is not specified, the records must be maintained until the NRC 
    terminates the CoC.
        (c) Any record maintained under this part may be either the 
    original or a reproduced copy by any state-of-the-art method provided 
    that any reproduced copy is duly authenticated by authorized personnel 
    and is capable of producing a clear and legible copy after storage for 
    the period specified by NRC regulations.
        (d) Each certificate holder shall submit a written report to the 
    NRC within 30 days of discovery of a design or fabrication deficiency, 
    for any spent fuel storage cask which has been delivered to a licensee, 
    when the design or fabrication deficiency affects the ability of 
    structures, systems, and components important to safety to perform 
    their intended safety function. The written report shall be sent to the 
    NRC in accordance with the requirements of Sec. 72.4. The report shall 
    include the following:
        (1) A brief abstract describing the deficiency, including all 
    component or system failures that contributed to the deficiency and 
    corrective action taken or planned to prevent recurrence;
        (2) A clear, specific, narrative description of what occurred so 
    that knowledgeable readers familiar with the design of the spent fuel 
    storage cask, but not familiar with the details of a particular cask, 
    can understand the deficiency. The narrative description shall include 
    the following specific information as appropriate for the particular 
    event:
        (i) Dates and approximate times of discovery;
        (ii) The cause of each component or system failure, if known;
        (iii) The failure mode, mechanism, and effect of each failed 
    component, if known;
        (iv) A list of systems or secondary functions that were also 
    affected for failures of components with multiple functions;
        (v) The method of discovery of each component or system failure;
        (vi) The manufacturer and model number (or other identification) of 
    each component that failed during the event;
        (vii) The model and serial numbers of the affected spent fuel 
    storage casks; (viii) The licensees that have affected spent fuel 
    storage casks;
        (3) An assessment of the safety consequences and implications of 
    the deficiency. This assessment shall include the availability of other 
    systems or components that could have performed the same function as 
    the components and systems that were affected;
        (4) A description of any corrective actions planned as a result of 
    the deficiency, including those to reduce the probability of similar 
    occurrences in the future;
        (5) Reference to any previous similar deficiencies at the same 
    facility that are known to the certificate holder; and
        (6) The name and telephone number of a person within the 
    certificate holder's organization who is knowledgeable about the 
    deficiency and can provide additional information.
    
        Dated at Rockville, Maryland, this 5th day of October, 1999.
    
    
    [[Page 56128]]
    
    
        For the Nuclear Regulatory Commission.
    Andrew L. Bates,
    Acting Secretary of the Commission.
    [FR Doc. 99-26700 Filed 10-14-99; 8:45 am]
    BILLING CODE 7590-01-P
    
    
    

Document Information

Effective Date:
12/14/1999
Published:
10/15/1999
Department:
Nuclear Regulatory Commission
Entry Type:
Rule
Action:
Final rule.
Document Number:
99-26700
Dates:
This final rule is effective on December 14, 1999.
Pages:
56114-56128 (15 pages)
RINs:
3150-AF93: Expand Applicability To Include Additional Parties
RIN Links:
https://www.federalregister.gov/regulations/3150-AF93/expand-applicability-to-include-additional-parties
PDF File:
99-26700.pdf
CFR: (38)
10 CFR 72.86(b)
10 CFR 72.146(c)
10 CFR 72.140(c)
10 CFR 72.140(c)
10 CFR 72.234(d)
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