State: Feds Have “No Regulatory Jurisdiction” over Uranium Mill

March 23, 2012

State officials say "it is inappropriate for the NRC to have interjected itself" into a legal dispute over the uranium mill

DENVER – Now that the U.S. Nuclear Regulatory Commission (NRC) has tarnished Colorado’s reputation for good government on the licensing of a uranium mill, Colorado officials would like the NRC to clean up its mess.

Dr. Christopher Urbina, executive director of the Colorado Department of Public Health and Environment, fired off a letter to the NRC last week chastising the agency for contending that the state had botched the licensing of the proposed Pinon Ridge Uranium Mill.

Urbina also asked for a retraction or clarification to “mitigate the damage already done by the distribution of this mischaracterization to the national press,” said the department in a press release.

“For a federal agency to come along at this late date to muddy the waters is an outrage to all the community members, stakeholders and others who took the time to participate in the public process regarding the radioactive materials license,” said Urbina.

At the core of the spat is whether the state satisfied the public-hearing requirement before granting the license. The CDPHE issued a radioactive-materials license in March 2011 to Energy Fuels Inc., a Canadian-based company, to build the uranium mill in rural Montrose County.

But NRC deputy director Deborah Jackson and acting deputy director Pamela Henderson said in a March 6 letter that the state agency “did not provide an opportunity for a public hearing or notice for public comment” on the proposed uranium mill. She also claimed that the agency had agreed to rectify the situation by overhauling its regulations to request a public hearing “for uranium milling licensing actions potentially impacting the environment.”

The letter touched off a spate of unflattering headlines on how the state had “botched licensing of uranium mill” (Colorado Independent), “bungled public review of proposed uranium mill” (The Denver Post), and “botched uranium mill hearings” (The Coloradoan).

Colorado regulators were flabbergasted when they read the coverage for a number of reasons: They said they never received the  from the NRC; they never agreed to “rectify the situation,” because they never conceded that there was a problem with their procedures, and even if they had agreed to take corrective action, such changes would be applied to future cases, not retroactively to the Pinon Ridge decision.

“We did not propose formal corrective action,” said CDPHE spokesman Warren Smith. “We have always maintained our program is compatible [with federal law].”

Especially galling for Colorado officials was that the NRC letter was sent not to the state, but to Jeffrey Parsons, an attorney for the Sheep Mountain Alliance, a Telluride environmental group that opposes the uranium mill. The CDHPE has yet to receive a copy of the letter from the NRC, and only learned of it in the press, said Smith.

The Sheep Mountain Alliance and the city of Telluride have sued the state and Energy Fuels to stop the uranium mill, arguing that the CDHPE failed to offer an adequate public hearing on the license. The SMA had repeated its complaint in a letter to the NRC, even though the CDHPE notes that it held two public hearings and six public meetings on the application and review process.

State officials worry that the NRC’s involvement has lent credence to the lawsuit, even though the federal agency has no authority to overturn the license. As a so-called Agreement State, Colorado has regulatory authority over its radioactive materials.

“Given that the NRC is not a party to this litigation and has no regulatory jurisdiction over the Energy Fuels license issued by the State of Colorado, an Agreement State, it is inappropriate for the NRC to have interjected itself in this ongoing State litigation,” said Urbina.

Even though the state has issued the license, Energy Fuels is waiting for the outcome of the lawsuit before starting construction on the uranium mill. The briefings were due in state district court March 20, and a decision by the judge is expected in the next few months.

Pinon Ridge would be the first uranium mill to be built in the United States in 30 years. The mill would bring an estimated 85 jobs paying $45,000 to $75,000 per year to the Paradox Valley near Nucla, between the Dolores and San Miguel rivers. Once a mining hub, the region is now struggling in the face of the economic downturn.

“Most of the people in the area are gung-ho for this mill. They want the jobs,” said Energy Fuels spokesman Curtis Moore. “They have trouble keeping a grocery store open. The high school is about to close. They’re proud of their mining heritage, and they want to see mining come back to the area.”

The proposed mine is located about 65 miles from Telluride. Hilary White, SMA executive director, said the mine would “leave a lasting legacy of toxic waste and economic liability for the public. We hope that this is an opportunity to explore clean energy solutions for Southwest Colorado.”

So far CDHPE officials have had discussions with NRC staff, said Mr. Smith, but no retraction has been forthcoming. NRC regulators will travel to Denver in April to meet with state officials for a periodic review of the state agency’s procedures.


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