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Text of Letters from the President to the Speaker of the house of Representatives and the President of the Senate concerning his plan for construction of additional uranium enrichment plants in the US
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7339815
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Text of Letters from the President to the Speaker of the house of Representatives and the President of the Senate concerning his plan for construction of additional uranium enrichment plants in the US
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White House Press Releases (Ford Administration)
Press Releases
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1975-06-26
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1975
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Digitized from Box 12 of the White House Press Releases at the Gerald R. Ford Presidential Library
EMBARGOED FOR RELEASE
June 26, 1975
UNTIL 12:00 NOON (EDT)
Office of the White House Press Secretary
THE WHITE HOUSE
TEXT OF LETTERS FROM THE PRESIDENT TO THE
SPEAKER OF THE HOUSE OF REPRESENTATIVES
AND THE PRESIDENT OF THE SENATE
June 26, 1975
Dear Mr. Speaker: (Dear Mr. President:)
I have today sent to the Congress a message describing my
plan for securing the construction of additional uranium
enrichment plants in the United States by private industry
to meet the growing needs of the expanding nuclear power
industry.
A critical element of this plan is legislation to authorize
the Administrator of the Energy Research and Development
Administration to enter into cooperative agreements with
private firms to foster, through Government cooperation
and temporary assurances, the creation of a competitive
private uranium enrichment industry. I am enclosing a
proposed bill, the Nuclear Fuel Assurance Act of 1975,
which would provide the authority needed to achieve the
objectives described in my message. A brief analysis of
the bill is also enclosed.
I urge the Congress to pass this legislation at the earliest
possible date so that we can take a major step toward our
goal of energy independence.
Sincerely,
GERALD R. FORD
######
A BILL
To authorize cooperative arrangements with private
enterprise for the provision of facilities for
the production and enrichment of uranium en-
riched in the isotope 235, to provide for
authorization of contract authority therefor,
and for other purposes.
Be it enacted by the Senate and the House of
Representatives of the United States of America in
Congress assembled, That this Act may be cited as
the "Nuclear Fuel Assurance Act of 1975."
Sec. 2. Chapter 5. PRODUCTION OF SPECIAL NUCLEAR MATERIAL
of the Atomic Energy Act of 1954, as amended, is amended
by adding at the end thereof the following Section:
"Sec. 45 Cooperative Arrangements for Private
Projects to Provide Uranium Enrichment Services --
"a. The Energy Research and Development
Administration is authorized, without regard to the
provisions of Section 169 of this Act, to enter into
cooperative arrangements with any person or persons
for such periods of time as the Administrator of the
Energy Research and Development Administration may
deem necessary or desirable for the purpose of pro-
viding such Government cooperation and assurances
as the Administrator may deem appropriate and
necessary to encourage the development of a com-
petitive private uranium enrichment industry and
to facilitate the design, construction, ownership
and operation by private enterprise of facilities
for the production and enrichment of uranium en-
riched in the isotope 235 in such amounts as will
contribute to the common defense and security and
encourage development and utilization of atomic
energy to the maximum extent consistent with the
common defense and security and with the health
and safety of the public; including, inter alia,
in the discretion of the Administrator,
(1) furnishing technical assistance, in-
formation, inventions and discoveries, enriching
services, materials, and equipment on the basis of
recovery of costs and appropriate royalties for
the use thereof;
more
2
(2) providing warranties for materials
and equipment furnished;
(3) providing facility performance
assurances;
(4) purchasing enriching services;
(5) undertaking to acquire the assets
or interest of such person, or any of such persons,
in an enrichment facility, and to assume obligations
and liabilities (including debt) of such person, or
any of such persons, arising out of the design, con-
struction, ownership, or operation for a defined
period of such enrichment facility in the event
such person or persons cannot complete that en-
richment facility or bring it into commercial
operation: Provided that any undertaking, pursuant
to this subsection 5, to acquire equity or pay off
debt, shall apply only to individuals who are
citizens of the United States, or to any corporation
of other entity organized for a common business
purpose, which is owned or effectively controlled
by citizens of the United States; and
(6) determining to modify, complete and
operate that enrichment facility as a Government
facility or to dispose of the facility at any time,
as the interest of the Government may appear, subject
to the other provisions of this Act.
"b. Before the Administrator enters into any
arrangement or amendment thereto under the authority
of this section, or before the Administrator deter-
mines to modify, or complete and operate any facility
or to dispose thereof, the basis for the proposed
arrangement or amendment thereto which the
Administrator proposes to execute (including the
name of the proposed participating person or
persons with whom the arrangement is to be made,
a general description of the proposed facility,
the estimated amount of cost to be incurred by
the participating person or persons, the incentives
imposed by the agreement on the person or persons
to complete the facility as planned and operate it
successfully for a defined period, and the general
features of the proposed arrangement or amendment),
or the plan for such modification, completion,
more
3
operation or disposal by the Administrator, as
appropriate, shall be submitted to the Joint
Committee on Atomic Energy, and a period of forty-
five days shall elapse while Congress is in session
(in computing such forty-five days, there shall be
excluded the days on which either House is not in
session because of adjournment for more than three
days) unless the Joint Committee by resolution in
writing waives the conditions of, or all or any
portion of, such forty-five day period: Provided,
however, that any such arrangement or amendment
thereto, or such plan, shall be entered into in
accordance with the basis for the arrangement or
plan, as appropriate, submitted as provided herein."
Sec. 3. The Administrator of the Energy Research
and Development Administration is hereby authorized
to enter into contracts for cooperative arrangements,
without fiscal year limitation, pursuant to Section 45
of the Atomic Energy Act of 1954, as amended, in an
amount not to exceed in the aggregate $8,000,000,000
as may be approved in an appropriation Act. In the
event that liquidation of part or all of any financial
obligations incurred under such cooperative arrange-
ments should become necessary, the Administrator of
the Energy Research and Development Administration is
authorized to issue to the Secretary of the Treasury
notes or other obligations up to the levels of contract
authority approved in an appropriation Act pur-
suant to the first sentence of this section in
such form and denomination, bearing such maturity
and subject to such terms and conditions as may
be prescribed by the Administrator with the approval
of the Secretary of the Treasury. Such notes or
other obligations shall bear interest at a rate
determined by the Secretary of the Treasury, tak-
ing into consideration the current average market
yield on outstanding marketable obligations of
the United States of comparable maturity at the
time of issuance of the notes or other obligations.
The Secretary of the Treasury shall purchase any
notes or other obligations issued hereunder and,
for that purpose, he is authorized to use as a
public debt transaction the proceeds from the sale
of any securities issued under the Second Liberty
Bond Act, as amended, and the purposes for which
securities may be issued under that Act, as
amended, are extended to include any purchase of
such notes and obligations. The Secretary of the
more
4
Treasury may at any time sell any of the notes or
other obligations acquired by him under this
section. All redemptions, purchases and sales
by the Secretary of the Treasury of such notes
or other obligations shall be treated as public
debt transactions of the United States. There
are authorized to be appropriated to the
Administrator such sums as may be necessary to
pay the principal and interest on the notes or
obligations issued by him to the Secretary of
the Treasury.
Section 4. The Administrator of the Energy Research
and Development Administration is hereby authorized to
initiate construction planning and design activities
for expansion of an existing uranium enrichment facility.
There is hereby authorized to be appropriated such sums
as may be necessary for this purpose.
# # # #
more
Bill Analysis
Section 1 of the proposed bill cites the Act as
the "Nuclear Fuel Assurance Act of 1975.'
Section 2 of the proposed bill would amend Chapter
5, Production of Special Nuclear Material, of the Atomic
Energy Act, as amended, by adding a new Section 45,
entitled "Cooperative Arrangements for Private Projects
to Provide Uranium Enrichment Services. 11
Subsection a. of the new Section 45 would authorize
the Administrator of the Energy Research and Development
Administration (ERDA) to enter into cooperative arrange-
ments with private enterprise to facilitate the development
of a competitive private industry for the enrichment of
uranium to make fuel for nuclear power plants. This
subsection would enable the Administrator to promote
private investment in the construction, ownership and
operation of uranium enrichment plants by providing such
Government cooperation and assurances as are determined
to be necessary and in the best interests of the Govern-
ment after detailed negotiation with selected individual
proposers of enrichment services. Such negotiations would
be directed toward obtaining arrangements most advan
tageous to the Government and the public interest and
with a degree of risk to the private entrepreneurs
consistent with the objective of creating a private
competitive uranium enrichment industry.
Cooperative arrangements authorized by Section 45a
could include such Government cooperation and assurances
as enumerated in the bill, including the specific
authority provided in subsection 45a (5), for the Govern
ment to acquire the assets or interests and assume the
liabilities (including debt) of a private enrichment firm
in the event -- which is highly unlikely ---- that private
industry could not complete a plant or bring it into
operation. It is intended that any undertaking by the
Government under subsection (5) to acquire assets or
interest and to assume liabilities of a private venture
would terminate after approximately one year of commercial
operation of a plant. The precise period would be defined
during the negotiations of defined agreements. Any
obligations to pay off debt and to acquire equity interest
would be limited to citizens of the United States.
Subsection b. of the new Section 45 would provide
for review by the Joint Committee on Atomic Energy of
the basis for any cooperative arrangement, or
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2
thereof, which the Administrator proposes to undertake,
including the basis for acquiring assets or interests,
or assuming liabilities of any private venture, and any
plan the Administrator may have for modifying, completing.
operating, or disposing of any plant built under a
cooperative agreement.
Section 3 of the proposed Nuclear Fuel Assurance
Act would authorize the Administrator of ERDA to enter
into contracts, pursuant to the new subsection 45a, in
an amount not to exceed $8 billion, as may be provided
in appropriation Acts. This amount is an estimate of
the total potential cost to the Government in the
unexpected event that all private ventures covered by
cooperative arrangements were to fail and it was then
necessary for the Government to assume assets and
liabilities of the ventures, take over plants, and
compensate domestic investors. It is not expected that
any of these funds would be expended for the assump--
tion of private ventures, but the authorization is
necessary to provide assurance, to customers and sources
of debt financing for private producers, of the Federal
Government's commitment to create a competitive industry.
Section 3 would also provide that, in the event of
Government assumption of the debts, interests and lia-
bilities of a private venture, the Administrator is
authorized to secure funds through the Secretary of
the Treasury to liquidate contract authority, up to
the levels previously provided in an appropriations
Act.
Section 4 of the proposed bill would authorize the
Administrator of ERDA to initiate preliminary engineering
design and planning for expansion of a Government-owned
uranium enrichment facility for contingency purposes.
#
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