The NRC recently issued a final rule in the Federal Register, along with a corresponding update to its Enforcement Policy, that updated the maximum amounts of civil monetary penalties it can impose for violations. Because these amounts are adjusted annually for inflation, the maximum civil penalties jumped for the second year in a row, reflecting the continued inflationary environment in the broader economy.
The final rule revised 10 CFR 2.205(j) to increase the maximum penalty the NRC can issue from $326,163 to $351,424 per violation, per day—an increase of 7.745% from 2022. Coupled with last year’s increase, the maximum penalty amount has risen 14.449% in just two years. Along with the increase to maximum penalty amount, the final rule also increased the maximum civil penalty under the Program Fraud Civil Remedies Act from $12,537 to $13,508 (a 7.188% increase) for each false claim or statement.
These monetary penalty amounts go into effect immediately and can be assessed even if a violation occurred before January 13, the date of the Federal Register notice.
Change in CPI Drives the Statutory Formula
As discussed in our prior posts on past increases to the maximum civil penalties, the NRC is required by the Federal Civil Penalties Inflation Adjustment Act of 1990, as amended by the Federal Civil Penalties Inflation Adjustment Act of 2015, to adjust civil penalty amounts for inflation by January 15 of each year. In particular, the 2015 Improvements Act requires the amounts to be adjusted based on the percentage change in the Consumer Price Index (CPI) from October of the previous year. Thus, this year’s adjustment is based on the increase in the CPI from October 2021 to October 2022.
Because of the significant inflation seen during that time, the 7.745% increase in the NRC’s maximum civil penalty amount is unsurprising. However, this increase follows last year’s significant increase of 6.222%, and has led to an increase of $44,366 dollars in just two years.
New Base Civil Penalties Outlined in the Enforcement Policy
The NRC also published a notice in the Federal Register that it had updated its Enforcement Policy to reflect the maximum increase in penalties. These were the only substantive changes to the Enforcement Policy. The full table of base civil penalties is provided below along with the equivalent amounts from 2022. The NRC’s practice is to round the maximum civil penalty amounts codified in 10 CFR 2.205(j) down to the nearest multiple of $10,000 in its Enforcement Policy. Last year’s amount was $320,000, which is now increased to $350,000. Thus, the net increase in the maximum civil penalty is $30,000.
The increase in the CPI over the past year resulted in increases to every category of civil penalties except the penalty for losing, abandoning, or improperly disposing of certain nuclear material. This penalty is determined by the estimated or actual costs of authorized disposal and is not tied to increases in the civil penalty amount in 10 CFR 2.205(j).
Penalty Amounts 2023 vs. 2022
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Table of NRC Base Civil Penalties
NRC Enforcement Policy |
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2023 |
2022 |
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a. Power reactors, gaseous diffusion uranium enrichment plants, and high-level waste repository |
$350,000 |
$320,000 |
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b. Fuel fabricators authorized to possess Category I or II quantities of SNM and uranium conversion facilities |
$175,000 |
$160,000 |
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c. All other fuel fabricators, including facilities under construction, authorized to possess Category III quantities of SNM, industrial processors, independent spent fuel and monitored retrievable storage installations, mills, gas centrifuge and laser uranium enrichment facilities |
$87,500 |
$80,000 |
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d. Test reactors, contractors, waste disposal licensees, industrial radiographers, and other large material users |
$35,000 |
$32,000 |
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e. Research reactors, academic, medical, or other small material users |
$17,500 |
$16,000 |
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f. Loss, abandonment, or improper transfer or disposal of regulated material, regardless of the use or type of licensee: |
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1. Sources or devices with a total activity greater than 3.7 × 104 MBq (1 Curie), excluding hydrogen-3 (tritium) |
$54,000 |
$54,000 |
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2. Other sources or devices containing the materials and quantities listed in 10 CFR 31.5(c)(13)(i) |
$17,000 |
$17,000 |
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3. Sources and devices not otherwise described above |
$7,000 |
$7,000 |
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g. Individuals who release safeguards information |
$8,750 |
$8,000 |
Morgan Lewis regularly assists licensees in NRC investigations and enforcement proceedings, and we will continue to track developments in these areas.