Nuclear Waste Fund: Budgetary, Funding, and Scoring Issues
Statement of
David M. Bearden
Specialist in Environmental Policy
Before
Committee on Energy and Commerce
Subcommittee on Environment and the Economy
U.S. House of Representatives
Hearing on
“Nuclear Waste Fund: Budgetary, Funding,
and Scoring Issues”
December 3, 2015
Congressional Research Service
https://crsreports.congress.gov
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Chairman Shimkus, Ranking Member Tonko, and Members of the Subcommittee, my name is David
Bearden. I am a Specialist in Environmental Policy for the Congressional Research Service (CRS). Thank
you for inviting me to testify on behalf of CRS regarding budgetary, funding, and scoring issues
associated with the management of the Nuclear Waste Fund.
In serving the U.S. Congress on a non-partisan and objective basis, CRS takes no position on these issues.
CRS has been asked by the Subcommittee today to outline the budgetary framework for the management
of the Nuclear Waste Fund. CRS remains available to assist the Subcommittee with these and related
issues.
Nuclear Waste Policy Act of 1982
Enacted in the 97th Congress on January 7, 1983, Section 302 of the Nuclear Waste Policy Act of 1982
(P.L. 97-425, 42 U.S.C. 10222) authorized the establishment of the Nuclear Waste Fund. The statute
structured it as a “separate” fund in the U.S. Treasury financed primarily with receipts from the collection
of fees from nuclear utilities. The fees are authorized to fund the permanent disposal of spent nuclear fuel
(or solidified high-level radioactive waste derived from spent nuclear fuel) created from the generation of
electricity involving civilian nuclear reactors.
As amended, the statute authorizes the Department of Energy (DOE) to develop a deep geologic
repository for the disposal of these wastes, subject to licensing by the U.S. Nuclear Regulatory
Commission (NRC). However, the Nuclear Waste Policy Act does not provide the authority to expend the
receipts collected for this purpose, making the use of the nuclear utility fee collections subject to
discretionary appropriation. The receipts credited to the Nuclear Waste Fund from these collections
therefore are not available to DOE to develop a repository until appropriated by Congress in subsequent
law. Once appropriated, Section 302 of the Nuclear Waste Policy Act authorizes the eligible uses for
which these monies may be expended.
The development of a repository, and the selection of Yucca Mountain in Nevada for its location, have
been the subject of various scientific, technical, regulatory, budgetary, and policy debates. The lack of a
repository to accept spent nuclear fuel has been an ongoing issue. Nuclear utilities have paid fees to
finance the Nuclear Waste Fund and entered contracts with the federal government under the Nuclear
Waste Policy Act for the disposal of their spent nuclear fuel by the statutory deadline of January 31, 1998.
Appropriations acts have made monies from the Nuclear Waste Fund available to DOE and NRC to
support the licensing process, but construction of a repository could not begin until NRC approves the
license, pursuant to the Nuclear Waste Policy Act. If the license were approved, the monies available for
construction would depend upon subsequent appropriations.
Nuclear utilities have filed damage claims against DOE for partial breach of existing contracts, to cover
their spent nuclear fuel storage costs in the interim while a repository is unavailable. Section 302(d) of the
Nuclear Waste Policy Act identifies the eligible uses of appropriations from the Nuclear Waste Fund, and
does not explicitly include payment for such damage claims.
The Judgment Fund of the U.S. Treasury has been the source of federal funds for the payment of eligible
claims. Pursuant to 31 U.S.C. 1304, the Judgement Fund is a permanent, indefinite appropriation
available for payment of final judgments, awards, and compromise settlements (and interest and costs
specified in the judgments) owed by the United States. The Judgment Fund generally is available for
payment of eligible claims, if the payment is not otherwise provided by law in separate appropriations.
DOE reports that a total of $5.3 billion had been paid from the Judgment Fund as of the end of FY2015
for eligible claims filed by nuclear utilities for private interim storage costs.
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Budgetary Framework of the Nuclear Waste Fund
Receipts from the nuclear utility fee collections in a fiscal year are deposited into the U.S. Treasury and
credited to the Nuclear Waste Fund as assets available for discretionary appropriation by Congress. The
receipts are not treated as revenue or offsetting collections for discretionary spending. Receipts from the
nuclear utility fee collections to finance the Nuclear Waste Fund are treated within the federal budget as
negative direct (i.e., “mandatory”) spending that has the effect of reducing total federal direct spending in
the fiscal year in which the receipts are collected. The accumulated balance of past collections from the
nuclear utility fees does not continue to count as a reduction to direct spending in future fiscal years, or it
otherwise would result in the double-counting of receipts collected by the federal government.
The unappropriated balance of the Nuclear Waste Fund is invested in U.S. Treasury securities that accrue
interest credited to the Nuclear Waste Fund through an intergovernmental transfer. The interest is an
additional source of receipts that contributes to the total balance of the Nuclear Waste Fund available for
discretionary appropriation. However, the interest does not serve as an offset to the appropriations
because it is an intergovernmental transfer within the federal budget and not a net increase in total federal
receipts.
The assets credited to the Nuclear Waste Fund from the nuclear utility fee collections are a liability to the
General Fund of the U.S. Treasury. This liability to the General Fund constitutes a financial commitment
of the federal government to provide the assets credited to the Nuclear Waste Fund, once discretionary
appropriations are enacted that would make the monies available for the purposes authorized in the
Nuclear Waste Policy Act.
Regardless of the accumulated balance of nuclear utility fee collections and interest credited to the
Nuclear Waste Fund, appropriations from the fund remain subject to limitations on annual discretionary
spending. These limits are established both statutorily (for example, through the Budget Control Act of
2011, as amended) and procedurally (for example, through congressional budget resolutions and sub-
allocations of discretionary spending determined by the House and Senate Committees on
Appropriations).
This framework for the Nuclear Waste Fund is not unique within the federal budget. Some examples of
other funds invested in U.S. Treasury securities that subject the use of collections to discretionary
appropriations and limitations on annual discretionary spending include:
Harbor Maintenance Trust Fund;
Hazardous Substance Superfund Trust Fund;
Leaking Underground Storage Tank Trust Fund; and
Uranium Enrichment Decontamination and Decommissioning Fund.
Status of Nuclear Waste Fund
As presented in the Office of Management and Budget (OMB) Appendix to the President’s FY2016
budget request submitted to Congress in February 2015, the accumulated unappropriated balance of assets
and interest credited to the Nuclear Waste Fund was $32.4 billion as of the end of FY2014.
This balance of $32.4 billion is the amount that remained available at that time for appropriation from the
Nuclear Waste Fund to carry out the purposes of the Nuclear Waste Policy Act, subject to the applicable
limitations on federal spending. Additional interest credited to the Nuclear Waste Fund in FY2015 would
increase the balance available for discretionary appropriation. In its Appendix to the President’s FY2016
budget request, OMB estimated that $1.53 billion in interest would accrue in FY2015.
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In November 2015, DOE released its department-wide financial report for FY2015. DOE reported a
balance in the Nuclear Waste Fund of $34.3 billion in net “investments and related interest” combined, as
of the end of FY2015.
There have been no new receipts credited to the Nuclear Waste Fund from collections of nuclear utility
fees since the suspension of the collections on May 16, 2014, as a result of litigation in the U.S. Court of
Appeals for the District of Columbia Circuit. This litigation challenged the present need for the fees,
considering the status of the licensing process for a repository and the reasonableness of plans and
assumptions upon which to estimate the funding needs.
The Administration had included an estimate of $362 million in nuclear utility fee collections for FY2015
in the President’s FY2016 budget request as a “placeholder” in its budget presentation, based on its
assumption that the fees “will not remain uncollected indefinitely.” These estimated receipts were part of
the OMB calculation of the total federal budget deficit in preparing the Administration’s total budget
estimate for FY2015. Of course, the actual impacts on deficit reduction in FY2015 depend on actual
collections, which did not occur during FY2015.
Under current law and existing budgetary procedural requirements, the unappropriated balance of assets
and interest credited to the Nuclear Waste Fund over time remains available for appropriation to carry out
the purposes of the Nuclear Waste Policy Act, subject to the applicable limitations on federal spending.
The budgetary treatment of the receipts in the account does not permit past collections to be applied as an
offset to future spending from the Nuclear Waste Fund to avoid the double-counting of receipts. Other
potential budgetary options may be dependent upon amendments or exceptions to current law or existing
budgetary procedural requirements.
That concludes the remarks of my prepared statement. Thank you for the opportunity to appear before the
Subcommittee today. I would be happy to address any questions you may have.
Disclaimer
This document was prepared by the Congressional Research Service (CRS). CRS serves as nonpartisan shared staff
to congressional committees and Members of Congress. It operates solely at the behest of and under the direction of
Congress. Information in a CRS Report should not be relied upon for purposes other than public understanding of
information that has been provided by CRS to Members of Congress in connection with CRS’s institutional role.
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