Shieldalloy Metallurgical Corp v. NRC, et al

Filing

OPINION filed [1516812] (Pages: 17) for the Court by Judge Sentelle [13-1259]

USCA Case #13-1259

Document #1516812

Filed: 10/14/2014

United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued September 12, 2014

Decided October 14, 2014

No. 13-1259
SHIELDALLOY METALLURGICAL CORPORATION,
PETITIONER
v.
NUCLEAR REGULATORY COMMISSION AND UNITED STATES OF
AMERICA,
RESPONDENTS
STATE OF NEW JERSEY,
INTERVENOR

On Petition for Review of an Order of
the U.S. Nuclear Regulatory Commission

Jay E. Silberg argued the cause for petitioner. With him
on the briefs were Matias F. Travieso-Diaz, Stephen L.
Markus, and Alison M. Crane.
Andrew P. Averbach, Solicitor, U.S. Nuclear Regulatory
Commission, argued the cause for respondents. With him on
the brief were Robert G. Dreher, Acting Assistant Attorney
General, U.S. Department of Justice, Lane N. McFadden,

Page 1 of 17

USCA Case #13-1259

Document #1516812

Filed: 10/14/2014

2
Attorney, and Grace H. Kim, Senior Attorney, U.S. Nuclear
Regulatory Commission.
Andrew D. Reese argued the cause and filed the brief for
intervenor State of New Jersey.
Before: GARLAND, Chief Judge, SRINIVASAN, Circuit
Judge, and SENTELLE, Senior Circuit Judge.
Opinion for the Court filed by Senior Circuit Judge
SENTELLE.
SENTELLE, Senior Circuit Judge:
Shieldalloy
Metallurgical Corporation petitions for review of a Nuclear
Regulatory Commission (“NRC” or “Commission”) order
reinstating the transfer of regulatory authority to the State of
New Jersey under the Atomic Energy Act, 42 U.S.C. § 2021.
The NRC issued the order under review, Shieldalloy
Metallurgical Corp., CLI-13-06, 78 NRC __ (Aug. 5, 2013)
(“Order”), to address concerns raised by this Court in
Shieldalloy Metallurgical Corp. v. NRC, 707 F.3d 371 (D.C.
Cir. 2013) (“Shieldalloy II”). We conclude that the NRC has
rationally addressed these concerns when it provided a textual
analysis of 10 C.F.R. § 20.1403 and explained how New
Jersey’s regulatory regime is adequate and compatible with
the NRC’s regulatory program. Contrary to Shieldalloy’s
arguments, the NRC’s Order does not conflict with its prior
interpretations or amount to a convenient, post hoc litigating
position. We therefore deny Shieldalloy’s petition for review.
I.
Shieldalloy manufactured metal alloys in Newfield, New
Jersey for approximately fifty years. While processing the
raw materials and ores necessary to produce the metal alloys,
Shieldalloy generated radioactive byproducts. Shieldalloy
had an NRC license to store these byproducts on site. When

Page 2 of 17

USCA Case #13-1259

Document #1516812

Filed: 10/14/2014

3
it ceased operations at the Newfield site in 1998, Shieldalloy
had accumulated approximately 65,800 cubic meters of
radioactive materials containing uranium (U-238) and thorium
(Th-232). Intervenor New Jersey reminds us that the average
household refrigerator has approximately one cubic meter of
storage. The half-life for uranium and thorium exceeds four
billion years, and Shieldalloy stores these byproducts in
uncovered waste piles on the site, which is located near
residences and businesses.
The present petition is the third to reach this Court in a
longstanding dispute over the rules governing what
Shieldalloy must do with the radioactive waste at its Newfield
site. Around the time that Shieldalloy first sought to
decommission the site, the NRC developed and published
rules for decommissioning licensed facilities, referred to as
the license termination rule or “LTR.” See 10 C.F.R.
§§ 20.1401–06.
The LTR provisions “provide specific
radiological criteria for the decommissioning of lands and
structures . . . to ensure that decommissioning will be carried
out without undue impact on public health and safety and the
environment.” Final Rule, Radiological Criteria for License
Termination, 62 Fed. Reg. 39,058, 39,058 (July 21, 1997).
The rules generally express the NRC’s preference to
decommission a site in a way that allows for the unrestricted
future use of the property. Id. at 39,069. As its name
suggests, unrestricted use contemplates that there will be no
limit to public use of the land in the future, and access will be
“neither limited nor controlled by the licensee.” 10 C.F.R.
§ 20.1003. In its final rulemaking, the NRC explained that
“termination of a license for unrestricted use is preferable
because it requires no additional precautions or limitations on
use of the site after licensing control ceases, in particular for
those sites with long-lived nuclides.” 62 Fed. Reg. at 39,069.
To qualify for unrestricted release, the licensee must
physically remove or decontaminate radioactive material to

Page 3 of 17

USCA Case #13-1259

Document #1516812

Filed: 10/14/2014

4
ensure that the residual levels of radioactivity remaining on
site result in doses of radiation no higher than 25 millirem per
year. See 10 C.F.R. § 20.1402. By way of context, a chest xray typically gives a dose of 10 millirem. Doses in Our Daily
Lives, http://www.nrc.gov/about-nrc/radiation/aroundus/doses-daily-lives.html (last visited Oct. 14, 2014).
Under limited circumstances, the LTR provisions also
allow licensees to dispose of radioactive waste on site with
restricted future use. 62 Fed. Reg. at 39,069; see also 10
C.F.R. § 20.1403. Restricted use means that access to the
area “is limited by the licensee for the purpose of protecting
individuals against undue risks from exposure to radiation and
radioactive materials.” 10 C.F.R. § 20.1003. In contrast to
unrestricted release, a licensee seeking restricted release is
allowed to achieve the 25 millirem per year dose limit by
installing controls to limit access to radioactive material left
on site. See id. § 20.1403(b).
Shieldalloy has consistently sought to dispose of its
radioactive waste on site through restricted future use. See,
e.g., Decommissioning of Shieldalloy Metallurgical
Corporation’s Facility in Newfield, NJ, 58 Fed. Reg. 62,387,
62,388-89 (Nov. 26, 1993). Between 2002 and 2009,
Shieldalloy submitted four versions of its on-site
decommissioning plan, but the NRC never accepted any of
the plans. The NRC Commissioner urged Shieldalloy to
explore options other than on-site decommissioning.
Independent of the NRC’s discussions with Shieldalloy,
the governor of New Jersey requested that the Commission
transfer its nuclear regulatory authority to the State of New
Jersey as authorized by the Atomic Energy Act. See Notice of
Proposed Agreement, 74 Fed. Reg. 25,283, 25,283-87 (May
27, 2009). Under the statute, the NRC “shall enter into an
agreement” to transfer its authority to a state if it finds the
state’s regulatory regime is “adequate to protect the public

Page 4 of 17

USCA Case #13-1259

Document #1516812

Filed: 10/14/2014

5
health and safety” and “compatible with the Commission’s
program.” 42 U.S.C. § 2021(d). The Commission called for
comments regarding the transfer, and Shieldalloy argued that
New Jersey’s regulatory regime was not compatible with
federal regulations. The NRC rejected these arguments and
issued an order denying Shieldalloy’s motion to stay the
transfer of authority to New Jersey. When the transfer
occurred, the Commission forwarded Shieldalloy’s pending
decommissioning plan to New Jersey. About two weeks later,
New Jersey informed Shieldalloy that the plan was
unacceptable and asked Shieldalloy to submit a new
decommissioning plan that complied with state regulations.
Shieldalloy has yet to submit a revised plan to New Jersey.
Fearing that it would have to abandon its restricted
release decommissioning plan and be forced to adopt a more
expensive unrestricted release plan, Shieldalloy petitioned this
Court for review of the NRC’s transfer of authority.
Shieldalloy Metallurgical Corp. v. NRC, 624 F.3d 489 (D.C.
Cir. 2010) (“Shieldalloy I”). We held in Shieldalloy I that the
transfer of authority was arbitrary and capricious because the
NRC did not provide a sufficient explanation for its actions.
Id. at 495. After remand, the NRC gave Shieldalloy and New
Jersey a fresh opportunity to comment on the transfer. The
NRC conducted a full review, examined all issues anew, and
reinstated the transfer of its regulatory authority to New
Jersey.
For a second time, Shieldalloy petitioned this Court for
review, arguing that the NRC followed neither its own
regulations nor the requirements of the Atomic Energy Act.
Shieldalloy II, 707 F.3d at 376-77. Again, this Court vacated
the transfer of authority. Id. at 383.
The Court was
unpersuaded by the Commission’s explanation of its
interpretation of 10 C.F.R. § 20.1403(a), which permits a
licensee to terminate its license under restricted conditions if

Page 5 of 17

USCA Case #13-1259

Document #1516812

Filed: 10/14/2014

6
it can demonstrate that further reductions in residual
radioactivity would result in net public or environmental
harm, or if further reductions are not being made because
levels of residual radioactivity are already as low as
reasonably achievable (“ALARA”). Id. at 379. Because the
NRC’s interpretation of this rule “lacked an apparent textual
basis,” the Court remanded for “the Commission [to] explain
itself.” Id. at 382.
On remand, the NRC issued CLI-13-06, the Order now
under review. The Commission reinstated the transfer of
authority to New Jersey and “provide[d] additional
explanation to clarify that § 20.1403(a) is consistent with
(and, in fact, codifies) our preference that licensees satisfy our
radiation dose criteria for license termination through
unrestricted-release decommissioning if it is cost-beneficial to
do so.” Order at 3-4. The NRC explained that the ALARA
principle in § 20.1403(a) provides an initial eligibility test for
restricted release, and reaffirmed its prior conclusion that
New Jersey’s regulatory regime is adequate and compatible
with NRC’s regulations. Order at 23. The NRC also clarified
how its interpretation is consistent with prior practices and
interpretations. Order at 18-23.
Shieldalloy again petitions this Court to vacate the
NRC’s Order transferring regulatory authority to New Jersey.
II.
We review NRC final orders under the arbitrary and
capricious standard of the Administrative Procedure Act, 5
U.S.C. § 706(2)(A). Under the arbitrary and capricious
standard of review, an agency must “set forth its reasons for
decision,” Tourus Records, Inc. v. DEA, 259 F.3d 731, 737
(D.C. Cir. 2001) (internal quotation marks omitted) (quoting
Roelofs v. Secretary of the Air Force, 628 F.2d 594, 599 (D.C.
Cir. 1980)), and “‘respond meaningfully’ to objections raised

Page 6 of 17

USCA Case #13-1259

Document #1516812

Filed: 10/14/2014

7
by a party,” PPL Wallingford Energy LLC v. FERC, 419 F.3d
1194, 1198 (D.C. Cir. 2005) (quoting Canadian Ass’n of
Petroleum Producers v. FERC, 254 F.3d 289, 299 (D.C. Cir.
2001)). When the agency “has considered the relevant factors
and articulated a rational connection between the facts found
and the choice made,” we will uphold its decision.
Transcontinental Gas Pipe Line Corp. v. FERC, 518 F.3d
916, 919 (D.C. Cir. 2008) (quoting Nat’l Ass’n of Clean Air
Agencies v. EPA, 489 F.3d 1221, 1228 (D.C. Cir. 2007)).
An agency’s interpretation of its own regulations is
entitled to “substantial deference” and is given “controlling
weight unless it is plainly erroneous or inconsistent with the
regulation.” Thomas Jefferson Univ. v. Shalala, 512 U.S.
504, 512 (1994). Deference is appropriate even if the
agency’s interpretation first appears during litigation, see
Auer v. Robbins, 519 U.S. 452, 462-63 (1997), unless the
interpretation conflicts with prior interpretations or amounts
to “nothing more than a convenient litigating position,”
Christopher v. SmithKline Beecham Corp., 132 S. Ct. 2156,
2166 (2012) (internal quotation marks and citation omitted).
Shieldalloy argues that the NRC’s transfer of regulatory
authority to New Jersey was arbitrary and capricious because
the NRC did not rationally explain how New Jersey’s
regulatory regime is “adequate to protect the public health and
safety” or “compatible with the Commission’s program”
under 42 U.S.C. § 2021(d)(2). We disagree. As we explain
below, we discern no reason to invalidate the NRC’s transfer
of regulatory authority. Accordingly, we conclude that the
NRC addressed the concerns raised in Shieldalloy II and
rationally explained how New Jersey’s regulatory regime is
adequate and compatible with the NRC’s regulations.

Page 7 of 17

USCA Case #13-1259

Document #1516812

Filed: 10/14/2014

8
A.
Shieldalloy contends that New Jersey’s regulations are
inadequate to protect public health and safety because New
Jersey’s program does not provide restricted use options that
will best reduce the public’s exposure to doses of radiation.
NRC regulations provide licensees like Shieldalloy a
restricted use option as a “reasonable means for terminating
licenses at certain facilities” so long as the decommissioning
is “properly designed” and there are “proper controls” in
place. 62 Fed. Reg. at 39,069. Shieldalloy argues that New
Jersey’s program, however, is not as safe as the NRC’s
regime because New Jersey’s regulations do not incorporate
the ALARA principle and essentially bar a licensee from
decommissioning a site with restricted future use. Shieldalloy
complains that it is virtually impossible for it to
decommission the Newfield facility for restricted release
under New Jersey’s regulations. Pet. Br. 64. To support its
argument, Shieldalloy points to NJRAD Form-314, the
disposition certificate that licensees must file to
decommission a site, because it only allows the licensee to
request “release for unrestricted use” and not restricted use.
See Pet. Reply Br. 26 (discussing the October 3, 2012 version
of the form).
This Court previously rejected Shieldalloy’s argument
“that the New Jersey rules were more stringent but less safe”
than the NRC standards. Shieldalloy II, 707 F.3d at 375.
Addressing the statutory requirement that a state program
must be adequate to protect the public health and safety, we
concluded
that
the
NRC,
“on
its
second
attempt, . . . adequately addressed Shieldalloy’s claims arising
out of . . . the parties’ conflicting interpretations of § 2021.”
Id. We need not revisit that conclusion.
Contrary to Shieldalloy’s argument, New Jersey’s
regulatory regime applies the ALARA principle to

Page 8 of 17

USCA Case #13-1259

Document #1516812

Filed: 10/14/2014

9
decommissioning activity because state regulations
incorporate by reference several provisions of 10 C.F.R. Part
20, including § 20.1101(b) (requiring licensees to use
protection principles to achieve doses to the public that are
ALARA for all licensed activity). N.J. Admin. Code § 7:286.1(a). By incorporating § 20.1101(b), New Jersey expressly
requires the application of the ALARA principle for license
termination and decommissioning. New Jersey’s program
therefore protects public health and safety through ALARA
just like the NRC’s regulatory regime.
New Jersey’s regulations also permit license termination
with restricted future use. New Jersey’s regulations include
options for licensees to decommission a site with “limited
restricted use” as well as “restricted use.” See N.J. Admin.
Code § 7:28-12.9(a)(1) (listing remediation standards for
radionuclides in soil). And New Jersey regulations even
provide a restricted use decommissioning option with
alternative standards. N.J. Admin. Code § 7:28-12.11(a).
Under the alternative standards option, the licensee is not
required to meet the soil concentration levels under N.J.
Admin. Code § 7:28-12.9 but is instead required to perform
computer dose modeling to ensure that the radioactivity from
the site will not cause a future on-site resident or worker to
receive more than a 15 millirem dose of radiation in a given
year. N.J. Admin. Code § 7:28-12.11(a)(1), (f)(2). At oral
argument, New Jersey made clear that it changed its
certification form to conform to its regulatory program, which
permits the restricted release of sites. When filing the
updated NJRAD Form-314, a licensee can now request that
New Jersey releases the site for restricted use in accordance
with state regulations. See NJRAD Form-314 (Revised May
23, 2014), available at www.state.nj.us/dep/rpp/rms/agreedo
wn/Termination.pdf.

Page 9 of 17

USCA Case #13-1259

Document #1516812

Filed: 10/14/2014

10
Like the NRC’s regulations, New Jersey’s regulations
also incorporate a preference for the removal of radioactive
materials to meet unrestricted conditions. Most importantly,
New Jersey’s regulations express a preference for unrestricted
release that is more protective of the public health than the
NRC’s regulations. To qualify for “limited restricted use” or
“restricted use” under N.J. Admin. Code § 7:28-12.9, the
licensee must remove sufficient radioactive materials to
ensure a future on-site resident or worker receives no more
than a 15 millirem dose of radiation in a given year. The
alternative standards similarly require the removal of waste so
that a person would only be exposed to a 15 millirem dose on
site. N.J. Admin. Code § 7:28-12.11(a)(1), (f)(2). And if all
controls failed, the dose to the public cannot exceed 100
millirem per year. See § 7:28-12.11(e). New Jersey’s
alternative standards are more stringent than the NRC’s
restricted release option. The NRC allows a maximum
exposure of 25 millirem per year for a person, 10 C.F.R.
§§ 20.1402, 20.1403(b), and an overall dose to the public of
up to 500 millirem per year if controls failed, § 20.1403(e).
Contrary to Shieldalloy’s arguments, the NRC’s transfer
of authority is not arbitrary and capricious simply because
New Jersey’s regulations impose more stringent requirements.
Indeed, the NRC has always contemplated transferring
authority to states under the agreement state program so long
as “[t]he overall level of protection of public health and safety
provided by a State program [is] equivalent to, or greater
than, the level provided by the NRC program.” Statement of
Principles and Policy for the Agreement State Program, 62
Fed. Reg. 46,517, 46,524 (Sept. 3, 1997) (emphasis added);
id. at 46,520 (“[T]he more stringent requirements do not
preclude or effectively preclude a practice in the national
interest without an adequate public health and safety or
environmental basis related to radiation protection.”); see also
Shieldalloy II, 707 F.3d at 375. We therefore conclude under

Page 10 of 17

USCA Case #13-1259

Document #1516812

Filed: 10/14/2014

11
the first statutory requirement that the NRC rationally
explained how New Jersey’s “program is adequate to protect
the public health and safety.” 42 U.S.C. § 2021(d)(2).
B.
Under the second statutory requirement of § 2021(d)(2),
Shieldalloy argues that the NRC’s transfer of regulatory
authority to New Jersey was arbitrary and capricious because
the NRC did not adequately explain how New Jersey’s
regulatory regime is compatible with the Commission’s
program. Shieldalloy suggests that New Jersey’s regulations
are incompatible with the NRC’s regulations because they do
not conform to the NRC’s restricted release rule, 10 C.F.R.
§ 20.1403. Under Shieldalloy’s reading of the rule, the NRC
permits a licensee to terminate its license under restricted
conditions whenever the licensee can show that restricted
release will cost-beneficially ensure lower radiation doses
than the radiation doses associated with unrestricted use,
which requires the costly removal of radioactive waste. In
other words, Shieldalloy contends that § 20.1403(a) requires
the licensee to compare the costs and benefits (including the
potential radiation doses to the public) of restricted as well as
unrestricted release, and then select the option that will costbeneficially result in the lowest exposure of radiation doses to
the public.
Shieldalloy points to the text of § 20.1403(a) and the
definition of ALARA, which refers to dose levels—ALARA
“means making every reasonable effort to maintain exposures
to radiation as far below the dose limits . . . as is practical.” 10
C.F.R. § 20.1003 (emphasis added). Because § 20.1403(a)
incorporates the ALARA standard, Shieldalloy contends that
this requires a cost-benefit comparison of dose levels
associated with leaving the materials on site (restricted
release) versus removing the materials from the site
(unrestricted release). Shieldalloy argues that the NRC’s

Page 11 of 17

USCA Case #13-1259

Document #1516812

Filed: 10/14/2014

12
interpretation to the contrary amounts to a post hoc litigation
position that is inconsistent with the NRC’s prior practices
and interpretations.
We reject Shieldalloy’s arguments and conclude that the
NRC adequately explained, based on “the authorities on
which it purports to draw,” how New Jersey’s regulations are
compatible with its own regulations. Shieldalloy II, 707 F.3d
at 375. Shieldalloy’s counsel acknowledged at oral argument
that New Jersey’s program is compatible with NRC
regulations if we accept NRC’s reading of § 20.1403(a),
which we do. The NRC’s reasonable interpretation of
§ 20.1403, which is owed substantial deference, neither
conflicts with prior interpretations, nor amounts to a
convenient litigating position. See SmithKline Beecham
Corp., 132 S. Ct. at 2166.
1.
Contrary to Shieldalloy’s argument, 10 C.F.R.
§ 20.1403(a) does not require the licensee to compare
radiation doses to the public under restricted release and
unrestricted release decommissioning plans. Instead, the
NRC reasonably reads § 20.1403(a) as an eligibility test for
the licensee to explain why, based on a cost-benefit analysis,
it should be relieved of its burden to take further remedial
measures required for unrestricted release. To qualify for
restricted release, the licensee must first explain why it is not
further reducing the proposed level of residual radioactivity.
Order at 13. The licensee establishes its eligibility for
restricted-use decommissioning only if further reductions in
residual radioactivity necessary to comply with the provisions
of § 20.1402 (1) “would result in net public or environmental
harm,” or (2) “were not being made because the residual
levels associated with restricted conditions are ALARA.” Id.
(quoting § 20.1403(a)). This “inquiry has nothing whatever
to do with accomplishing or assessing dose reductions using

Page 12 of 17

USCA Case #13-1259

Document #1516812

Filed: 10/14/2014

13
restricted release or comparing restricted-release
unrestricted-release dose” levels. Id. at 15.

and

The NRC explained how its reading gives full effect to
the language of the regulation, which focuses solely on
“further reductions in residual radioactivity” necessary to
accomplish unrestricted release under the provisions of
§ 20.1402. Order at 12. NRC regulations define “residual
radioactivity” as the “radioactivity in structures, materials,
soils, groundwater, and other media at a site resulting from
activities under the licensee’s control.” 10 C.F.R. § 20.1003.
While it is possible to reduce the doses of radioactivity to the
public from residual radioactivity using controls or
engineering associated with restricted use, the NRC explained
that “it is not possible to reduce ‘residual radioactivity’ itself
simply by taking these steps.” Order at 12-13 (emphasis in
original). Instead, a licensee can only reduce residual
radioactivity by physically removing radioactive material
from the site, which is associated with unrestricted release
decommissioning under § 20.1402. Id. at 15. Section
20.1403 therefore requires the licensee to explain why it is not
cost beneficial to remove additional radioactive waste from
the site before it can qualify for restricted release.
This Court previously recognized that “[t]he language of
§ 20.1403(a) is silent as to why an ALARA analysis of
restricted release would cause a licensee not to pursue
unrestricted release.” Shieldalloy II, 707 F.3d at 379. The
NRC acknowledges that the language of the rule “might, at
first glance, appear to focus on some defining property of
restricted release, such as the dose that could be costbeneficially achieved under a licensee’s restricted-release
plan.” Order at 16. But when the reference to ALARA in
§ 20.1403(a) is read in connection with the other language of
the sentence—specifically, why “further reductions in
residual activity” are not being made—it undermines

Page 13 of 17

USCA Case #13-1259

Document #1516812

Filed: 10/14/2014

14
Shieldalloy’s dose-comparison reading. Moreover, even
Shieldalloy concedes (as it must) that the definition of
ALARA incorporates more than just dose limits because the
ALARA principle encompasses the reasonable effort for
radiological protection based on “practical” considerations
and “quantitative cost-benefit analysis.” Pet. Br. at 34-35.
Under this broader conception of ALARA as
encompassing cost-benefit analysis, the NRC rationally
explained that the ALARA analysis from § 20.1403(a) asks
whether the proposed residual levels of radioactivity sought to
be left in place under the restricted use plan are already as low
as reasonably achievable, “such that ‘further’ removal or
decontamination would not be cost-beneficial.” Order at 17.
The licensee thus applies ALARA to analyze the quantitative
costs and benefits for achieving further reductions in the
residual levels of radioactivity. And a licensee becomes
eligible for restricted release if the proposed level of residual
radioactivity results in doses that exceed the levels allowable
for unrestricted release (25 millirem) under § 20.1402 but is
nevertheless cost beneficial because it is not possible to
further reduce the residual radioactivity in a cost-effective
way. Id.
The second sentence of § 20.1403(a) buttresses the
NRC’s broader reading of ALARA as requiring more than
just a dose-level comparison. The licensee must consider
“detriments, such as traffic accidents, expected to potentially
result from decontamination and waste disposal” in the
ALARA analysis. 10 C.F.R. § 20.1403(a). The inclusion of
this requirement further confirms and supports NRC’s reading
that the ALARA analysis in § 20.1403(a) focuses on reducing
residual radioactivity because traffic accidents resulting from
decontamination and waste disposal can only occur in
connection with the removal and transportation of materials
away from the site. Order at 16; see also Shieldalloy II, 707

Page 14 of 17

USCA Case #13-1259

Document #1516812

Filed: 10/14/2014

15
F.3d at 380 (“Traffic accidents related to waste disposal
would seem to have little to do with restricted release, which
involves on-site disposal of radioactive materials.”). On the
other hand, Shieldalloy’s reading of the first sentence of
§ 20.1403(a) is “in tension” with the second sentence of the
regulation because Shieldalloy’s reading would “permit
restricted release irrespective of the merits of unrestricted
release.” Shieldalloy II, 707 F.3d at 380. We reject
Shieldalloy’s reading because it turns the NRC’s wellestablished preference for unrestricted release on its head.
See id. (citing instances where the NRC has “repeatedly stated
it holds that preference”).
2.
The NRC’s interpretation of § 20.1403(a) not only
incorporates its preference for unrestricted release, but is also
consistent with the NRC’s other regulatory statements. Order
at 18-23. The NRC enacted § 20.1403(a) “to prevent
licensees from choosing restricted release,” not to encourage
it. Resp. Br. 59-60 (emphasis removed). The NRC prefers
that a licensee decommission its site under § 20.1402 with
unrestricted release, and that is why there is an eligibility test
to qualify for restricted release under § 20.1403(a). Id. at 48.
Shieldalloy’s interpretation would “eviscerate NRC’s
preference for unrestricted release” because a licensee would
almost always be able to choose restricted release by showing
that the removal of waste for unrestricted release is more
costly than erecting barriers to limit access to the site. Id. at
59.
We therefore reject Shieldalloy’s reading of the
regulation.
Shieldalloy mischaracterizes the NRC’s position as a
convenient, post hoc litigating position that conflicts with the
NRC’s prior interpretations of § 20.1403(a). Even assuming
the NRC is advancing its position for the first time in
litigation (an assumption we do not hold), we still owe

Page 15 of 17

USCA Case #13-1259

Document #1516812

Filed: 10/14/2014

16
deference to the NRC’s interpretation under Auer, 519 U.S. at
462-63. With or without deference, we conclude that the
NRC rationally explained how its current position is
consistent with prior interpretations of § 20.1403(a). For
example, the NRC explained that NUREG-1757 references
“comparisons between restricted and unrestricted release,” but
it does not refer to a comparison of radiation doses as
Shieldalloy suggests. Order at 18-19. The comparison relates
to “regulatory costs avoided”—i.e., the costs avoided under a
restricted plan can be included as benefits of an unrestricted
decommissioning plan. Order at 20; see Shieldalloy II, 707
F.3d at 381 (discussing the cross-reference to Appendix N).
“In other words, one of the benefits of reducing residual
levels of radioactivity to levels that do not exceed 25 mrem
[as required for unrestricted release under 10 C.F.R.
§ 20.1402] is the avoidance of costs that would otherwise be
incurred were the licensee to pursue restricted release.” Order
at 20. Nothing in NUREG-1757 requires a comparison of
dose levels to the public under restricted and unrestricted
release. See id. at 21.
Similarly, the NRC explained that its July 5, 2007 letter
to Shieldalloy does not call for a comparative dose-analysis.
The letter simply suggested that Shieldalloy may have
overestimated the work necessary to achieve unrestricted
release, which could erroneously bias the ALARA analysis in
favor of restricted release. Id. at 22-23. We agree with the
NRC.
***
Because New Jersey’s regulations are compatible with
the NRC’s regulations and its reading of § 20.1403(a), we
conclude that the NRC’s transfer of regulatory authority to
New Jersey under 42 U.S.C. § 2021 was not arbitrary or
capricious.

Page 16 of 17

USCA Case #13-1259

Document #1516812

Filed: 10/14/2014

17
III.
For the reasons stated, we deny Shieldalloy’s petition for
review of the NRC’s order reinstating the transfer of its
regulatory authority to the State of New Jersey.
So ordered.

Page 17 of 17