NRC Declines to Fund Indigent Participants in Agency Proceedings

After considering the matter for more than a year, the Nuclear Regulatory Commission (NRC) has declined,¹ over the dissent of one of its members, to become the first federal agency to provide financial assistance to indigent participants in administrative proceedings in the absence of an express statutory grant of authority.² In deciding not to initiate such a program, the Commission concluded that its existing power under enabling laws and appropriations statutes to grant assistance is so limited that the possibility of assistance awards without more explicit statutory authorization is essentially illusory. The Commission therefore held that resolution of the intervenor assistance issue is up to Congress. NRC decided against recommending enactment of additional authorizing legislation, however, except in one specific instance — the ongoing rulemaking on the commercial use of plutonium mixed-oxide fuel — after concluding that policy considerations weigh against its recommending that Congress establish a general assistance program.

Commissioner Victor Gilinsky dissented from the decision, arguing that NRC should issue rules allowing assistance awards on a case-by-case basis whenever the strict standard governing exercise of the Commission's existing power can be met. Galinsky also disagreed with NRC's refusal to recommend congressional enactment of legislation expressly authorizing such awards under certain circumstances to participants in licensing, rulemaking, and enforcement proceedings before the agency, saying that in his view the Commission's decision on this point went against the relevant policy considerations.

Comptroller General Opinion

In 1974, the Atomic Energy Commission, NRC's predecessor, tentatively determined that it had authority under existing law to fund participants in agency proceedings.³ Subsequent judicial decisions in Alyeska Pipeline Service Co. v. Wilderness Society⁴ and Turner v. Federal Communications Commission⁵ renewed the agency's earlier uncertainty, however, and NRC ultimately asked the Comptroller General for his opinion on the statutory authority question and had a private consultant prepare a report⁶ on the policy issues involved.

In February 1976, the Comptroller General issued his Opinion⁷ examining NRC's authority to establish unilaterally an intervenor assistance program. The Opinion focused on language in the Energy Reorganization Act of 1974,⁸ NRC's enabling statute, and in the Commission's most recent appropriation act.⁹ The former provides that NRC "shall grant a hearing" to persons in terested in licensing and rulemaking determinations and "shall admit" such persons as parties to the proceeding. The latter states that funds appropriated are for "necessary expenses of the Commission in carryong out the purposes of the Energy Reorganization Act of 1974…."¹⁰

The pivotal question under these authorities is whether it is necessary for the Commission to pay the expenses of intervenors in order to make statutorily-required determinations. The Comptroller General concluded that NRC has the power to use appropriated funds to assist participants in agency proceedings if the Commission:

in the exercise of its administrative discretion, determines that it cannot make the required determination unless it extends financial assistance to certain interested parties who require it, and whose participation is essential to dispose of the matter before it….¹¹

Later in the Opinion, however, the Comptroller General restated the standard in less restrictive terms:

NRC has the statutory authority to facilitate public participation in its proceedings by using its own funds to reimburse intervenors when (1) it believes that such participation is … necessary to represent adequately opposing points of view on a matter, and (2) when it finds that the intervenor is indigent or otherwise unable to bear the financial costs of participation in the proceedings.¹²

NRC Gloss

Professing to accept the Comptroller General's interpretation [7 ELR 10011] of its existing authority as controlling, the Commission chose the more restrictive first formulation of the applicable standard for funding awards as its guiding principle. NRC thus admitted that it had limited assistance authority but based its refusal to institute any type of intervenor assistance program on its inability to visualize situations in which performance of its statutory functions would be impossible without the participation of outside parties.

The Commission also implied that it might not begin an assistance program of its own volition even if more intervenors could meet this test. NRC emphasized that as a philosophical matter, it views as inappropriate any attempt by individual non-elected officials to resolve, without legislative guidance, the policy question of funding participants in administrative proceedings. The Comptroller General's Opinion apparently leaves the exercise of NRC's existing authority in this area to the agency's discretion, and the Commission has quite clearly chosen not to take any unilateral initiatives on the funding question.

Emphasizing its belief that Congress rather than an administrative agency should resolve such policy issues, NRC agreed with the Comptroller General's suggestion in the Opinion that legislative clarification of the precise limitations on the use of appropriated funds for assisting participants in agency proceedings is desirable. However, the Commission did not recommend that Congress, in acting on this question, expressly provide NRC with authority to grant financial assistance to participants in ordinary licensing and rulemaking proceedings.

In explaining its position on this point, the agency first voiced doubt that funded intervenors would make substantially greater contributions to the resolution of safety and environmental issues in individual licensing proceedings than are now being made by intervenors without federal assistance. According to NRC, the state of the art in reactor safety and identification and mitigation of environmental impacts is well advanced, the regulatory regime governing modern commercial light water reactors is comprehensive and well developed, and the NRC staff diligently scrutinizes license applications using its in-depth expertise on reactor safety and requirements relating to environmental protection.

Secondly, the Commission concluded that institutionalization of a funding scheme would inevitably delay the licensing process. In addition, the agency estimated that an assistance program would entail substantial cost, possibly on the order of several million dollars. It is noteworthy that, except for the prospect of additional delay, the Commission did not give great weight to anticipated administrative difficulties in making its decision, concluding that while these problems might be substantial, they were nonetheless solvable.

Funding in Rulemaking

NRC likewise remained unconvinced that funding participants in rulemakings warranted explicit statutory authorization.¹³ The Commission acknowledged that substantive contributions from participants are more likely in rulemaking proceedings because of the breadth and novelty of the issues involved. The agency nonetheless postulated that the use of rulemakings rather than a case-by-case approach permits more concentrated application of the participants' own resources and thereby makes federal funding less essential.

Moreover, in NRC's view, the national environmental and nuclear safety groups that typically participate in rulemakings are better financed than the local citizen groups that usually participate in licensing proceedings. The Commission asserted that since the national groups receive funds from a variety of sources, a request from one of these organizations for federal assistance simply reflects a preference to commit its limited resources elsewhere rather than an assertion that participation in NRC proceedings is impossible without financial assistance.

The one exception to NRC's general refusal to endorse legislative authorization of an assistance program was the on-going rulemaking on the question of widescale commercial use of mixed-oxide fuel containing plutonium in light water reactors. The Commission had no doubt that the current decision-making process relating to commercial plutonium use will produce a fully-adequate administrative record. The agency nevertheless believed that because of the extraordinary breadth and depth of the mixed-oxide fuel proceeding, the novelty of many of the issues, and the profound effect of the decision on widespread plutonium use, increased public participation which might be brought about by funding would not be superfluous. Under these unique circumstances, the Commission felt funding of indigent parties who fully participated in the mixed-oxide fuel rulemaking would be justified, and recommended that Congress appropriate $200,000 for this purpose. In order to expedite the funding once this appropriation was enacted, the agency set forth in detail the procedure to be followed in applying for assistance as well as the criteria upon which eligibility for funding will be determined and set the application process in motion.

Gilinsky Dissent

In a separate statement of his views, NRC Commissioner Victor Gilinsky supported the Commission's endorsement of legislation providing funds for some participants in the plutonium rulemaking. He also asserted, however, that the agency should have gone further. Specifically, Gilinsky argued that an assistance program reaching the limited number of cases in which participants could qualify for funds under the Comptroller General's restrictive standard should be established immediately and that authority to provide funds to qualifying intervenors across the whole range of NRC's activities sould be sought from Congress. The Commissioner asserted that NRC's history and his own experience with the agency indicate that the Commission's decision-making will not infrequently be improved by the tension produced by the participation of intervenors. In his estimation, external intervention has not only provided the impetus for necessary Commission action but has frequently suggested, by adversarily testing the NRC staff's publicly-taken position, a perspective on issues which would otherwise have been lacking.

Gilinsky therefore believed that the restrictive formulation of the Comptroller General's standard, which he described as "forbidding," could be met in particular cases and that NRC should exercise its existing [7 ELR 10012] authority in this area to the fullest by issuing regulations providing for assistance on a case-by-case basis to participants who are able to meet the standard. Similarly, given the prospective benefits to agency decision making, Gilinsky argued that NRC should actively seek appropriations and authority from Congress to institute an assistance program for eligible participants in all the agency's activities.

Future Developments

On the whole, NRC's decision on the funding assistance question reflects a very narrow view of both its existing assistance authority and the proper scope of its role in making policy decisions relating to public participation in agency proceedings. The Commission's categorical rejection of a general assistance program will not be the last word on the subject, however. In response to a query from Congressman Moss (D-Cal.) whether the rationale of the NRC ruling would also apply to the Federal Communicatons Commission, Federal Trade Commission (FTC), Federal Power Commission, Interstate Commerce Commission, Consumer Product Safety Commission, Securities and Exchange Commission, Food and Drug Administration, Environmental Protection Agency (EPA), and National Highway Traffic Safety Administration, the Comptroller General stated in a May 10, 1976 letter that:

there is no significant difference in the relevant authorities for the nine agencies you named and those of the NRC. Accordingly, the rationale of our February 19 decision to NRC is equally applicable to each agency named.¹⁴

As a result, these regulatory agencies are now separately faced with the financial assistance issue. The Food and Drug Administration recently announced an informal rulemaking on the question of funding participants in its proceedings under existing statutory authority.¹⁵

The Comptroller General reiterated in the letter his recommendation that Congress clearly define the parameters of agency assistance authority. Legislation has already been enacted accomplishing this to different degrees for two agencies. Section 6(c)(4) of the recently-enacted Toxic Substances Control Act¹⁶ provides EPA with authority to fund participants in rulemakings to prohibit or otherwise regulate the manufacture or commercial use of particular chemicals, and the Federal Trade Commission Improvement Act of 1974¹⁷ specifically authorizes the FTC to grant financial assistance to eligible participants in its proceedings. Passage of the latter statute followed the FTC's refusal to act upon a 1972 Opinion of the Comptroller General that found the agency had limited discretionary authority to fund indigent participants. The FTC has promulgated regulations¹⁸ governing assistance grants and has begun implementation of its funding program.

A number of bills authorizing financial assistance to participants in proceedings, either before a specific agency or before all agencies, were under consideration at the end of the 94th Congress.¹⁹ Despite NRC's failure to recommend such legislation, it is quite possible that the agency's refusal to initiate an intervenor assistance program will ultimately result in enactment of specific statutory authority and passage of an appropriation for this purpose. Moreover, notwithstanding NRC's decision, the Comptroller General's expansion of his finding of existing statutory assistance authority to a number of additional agencies means that the general issue of funding indigent participants remains open in the administrative as well as the legislative arena.

1. Nuclear Regulatory Commission, Financial Assistance to Participants in Commission Proceedings — Statement of Considerations Terminating Rulemaking, Nov. 12, 1976. Copies of this document are available from ELR (64 pp. $8.00, ELR Order No. A-1007).

2. See Comment, Agency Funding of Indigent Public Interest Intervenors in Administrative Proceedings, 6 ELR 10052 (Mar. 1976).

3. Consumers Power Co., No. 50-155, 39 Fed. Reg. 41291 (Nov. 26, 1974).

4. 421 U.S. 240, 5 ELR 20286 (1975).

5. 514 F.2d 778 (D.C. Cir. 1975).

6. Policy Issues Raised by Intervenors' Requests for Financial Assistance in NRC Proceedings, NUREG-75/071 (July 18, 1975).

7. Decision of the Comptroller General, No. B-92288, Feb. 19, 1976.

8. 42 U.S.C. §§ 5801 et seq. (Supp. 1975), Pub. L. 93-438.

9. Public Works for Water and Power Development and Energy Research Appropriation Act, Pub. L. 94-180 (Dec. 26, 1975).

10. Id.

11. Decision, supra note 7 at 4.

12. Id. at 7.

13. The Commission also found inadvisable the funding of intervenor participation in enforcement proceedings, because the issues are usually narrow and the staff is in a fully adversary posture vis-a-vis the applicant.

14. Letter from Comptroller General to Congressman John E. Moss, May 10, 1976.

15. 41 Fed. Reg. 35855 (Aug. 25, 1976).

16. 15 U.S.C. § 2605(c)(4), ELR 41342.

17. 15 U.S.C. § 57a(h)(1), Pub. L. 93-367.

18. 16 C.F.R. § 1.11-20, 40 Fed. Reg. 33966 (Aug. 13, 1975).

19. See, e.g., H.R. 2535, H.R. 12762, H.R. 13901, H.R. 15572 and S. 2715, 94th Cong. 2d Sess. (1976).