Nuclear Regulatory Commission Increases Civil Penalty Amounts
The US Nuclear Regulatory Commission (NRC or Commission) issued a final rule on January 12 to amend its regulations to adjust, for inflation, the maximum Civil Monetary Penalties (CMPs) it can assess under statutes enforced by the Commission. See Final Rule, Adjustment of Civil Penalties for Inflation for Fiscal Year 2018, 83 Fed. Reg. 1515. The NRC revised 10 CFR § 2.205 (Civil penalties) to adjust the maximum CMP for a violation of the Atomic Energy Act (AEA), or any regulation or order issued under the AEA, from $285,057 to $290,875 per violation, per day (an increase of 2.041%). The Commission similarly amended provisions concerning program fraud in 10 CFR § 13.3 (Basis for civil penalties and assessments) to adjust the maximum CMP under the Program Fraud Civil Remedies Act from $10,957 to $11,181 per false claim or statement. Under the rule, the NRC may apply these increased CMP amounts to any penalties assessed by the agency after the effective date of the rule (January 15, 2018), regardless of whether the associated violations occurred before or after this date.
Section 234 of the AEA (42 USC § 2282) limits civil penalties for violations of the AEA to $100,000 per day, per violation. However, the Federal Civil Penalties Inflation Adjustment Act of 1990 (FCPIAA), as amended by the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015 (2015 Improvements Act), requires the adjustment of CMPs for inflation in accordance with a statutory formula set forth in the legislation. The NRC previously had increased via rulemaking the maximum CMP amounts in 10 CFR §§ 2.205 and 13.3 on four occasions between 1996 and 2008. Notably, the 2015 Improvements Act requires that each agency continue to adjust CMP amounts on an annual basis, based on the percentage change between the Consumer Price Index (CPI) for the previous October and the CPI for October in the year preceding that.
The NRC assesses civil penalty amounts for violations of the AEA based on the class of licensee (e.g., reactor vs. materials licensee) and the severity of the violation, in accordance with the NRC Enforcement Policy. The Commission normally assesses civil penalties for Severity Level I and II violations and knowing and conscious violations of the reporting requirements of Section 206 of the Energy Reorganization Act, but also will consider civil penalties for Severity Level III violations. The maximum civil penalty amount specified in 10 CFR § 2.205 is the amount that the NRC will impose on nuclear power plant licensees for the most severe violation (Severity Level I). Although the Commission ordinarily does not issue civil penalties for violations associated with the Reactor Oversight Process (ROP) (as evaluated under the ROP significance determination process), it will consider the use of severity levels and associated civil penalties for violations that are willful, have the potential for impacting the regulatory process, or have actual consequences. According to the January 2018 final rule, the NRC plans to publish a corresponding update to its Enforcement Policy in the near future to reflect the updated maximum CMP amount in 10 CFR § 2.205.