ENERGY REORGANIZATION ACT OF 1973

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP75B00380R000500250002-2
• Release Decision: RIFPUB
• Original Classification: K
• Document Page Count: 69
• Document Creation Date: December 12, 2016
• Document Release Date: November 6, 2001
• Sequence Number: 2
• Publication Date: December 7, 1973
• Content Type: OPEN

Ap93D CONGn ss I aHe~ ( /OQ~ /REPA ~
1st Session
ENERGY REORGANIZATION ACT OF 1973
DECEMBER 7, 1973.-Committed to the Committee of the Whole House on the
State of the Union and ordered to be printed
Mr. HoLIFIELD, from the Committee on Government Operations,
submitted the following
REPORT
together with
ADDITIONAL VIEWS
[To accompany H.R. 115101
The Committee on Government Operations, to whom was referred
the bill (H.R. 11510) to reorganize and consolidate certain functions
of the Federal Government in a new Energy Research and Develop-
ment Administration and in a Nuclear Energy Commission in order
to promote more efficient management of such functions, having con-
sidered the same, report favorably thereon with an amendment and
recommend that the bill as amended do pass.
The amendment strikes out all after the enacting clause and inserts
a substitute text which appears in the reported bill in italic type as
well as in appendix 4 of this report.
Summary and purpose.
Need for the legislation.
Committee amendment.
Committee vote.
Background and hearings.
ERDA administrative organization.
ERDA missions.
R & D on all forms of energy.
Conservation R & D.
Efficiency and reliability R & D.
Environmental research.
Nuclear production, enrichment, and distribution activities.
Reactor development and Naval Reactor activities.
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Biomedical and physical research.
Fusion R & D.
Military application.
Other AEC functions.
Functions transferred to ERDA.
ERDA's authority.
Definition of research and development.
Training and educational activities.
Information and transfer of knowhow.
Contractual and other matters.
Patents.
Personnel.
Advisory Committee on Reactor Safeguards
Consultation and coordination.
Nuclear Energy Commission.
Authorization of appropriations.
Reports.
Estimated savings and cost.
Provisions of the Atomic Energy Act applicable to functions trans-
ferred from the AEC and to functions remaining in NEC.
Section-by-section analysis.
Changes in existing law made by the bill, as reported.
Appendixes :
1. List of bill sponsors.
2. Personnel provisions of H.R.11510.
3. Organization charts.
4. Text; of committee bill as reported.
Additional views.
SUMMARY AND PURPOSE
H.R. 11510, titled "The Energy Reorganization Act of 1973," will
reorganize and consolidate major energy research and development
(R & D) functions in the Federal Government. The bill provides
for:
(1) The creation of an independent Energy Research and De-
velopment Administration (ER)DA), which will encompass all
non-regulatory functions of the Atomic Energy Commission and
designated energy research and development functions trans-
ferred from other agencies.
(2) Renaming the Atomic Energy Commission as the Nuclear
Energy Commission (NEC), which will continue with the same
membership, though in a much smaller organization, to admin-
ister nuclear licensing and related regulatory functions.
Building upon the scientific and technical base of the present Atomic
Energy Commission, ERDA will be a central agency for the conduct
and coordination of major Federal energy R & D programs. The bill
gives the new agency a broad charter to conduct or sponsor R & D
on all energy resources and utilization. processes. Technologies for ex-
traction, conversion, storage, transmission and utilization are included.
ERDA will be so organized and managed that fossil fuel, advanced
energy sources, conservation of energy, and environmental considera-
tions will receive full recognition and appropriate emphasis along
with nuclear R & D functions.
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ERDA will be headed by a single Administrator and a Deputy
Administrator, both of whom will be appointed by the President with
the advice and consent of the Senate. They will be concerned prin-
cipally with setting R & D policy and general administration of the
agency.
The bill provides a balanced line organization of five Assistant
Administrators, each responsible for a major program area. The pro-
gram areas named in the bill are fossil energy development; nuclear
energy development; environment, safety, and conservation; research
and advanced energy systems; and national security. The Assistant
Administrators will be appointed by the President and confirmed
by the Senate.
The bill also provides for an additional pool of not more than 7
management positions at Executive level V. The Administrator will
appoint career officials to these positions and assign responsibilities.
These executives will head major staff offices or receive other important
assignments. There also will be a General Counsel appointed by the
Administrator.
Under the terms of the bill, the following offices or functions will be
transferred to ERDA from other Federal Departments or agencies :
All the functions of the Atomic Energy Commission, except
those relating to licensing and related regulatory matters.
Such functions of the Department of the Interior as relate to
the Office of Coal Research; the fossil fuel energy R & D pro-
grams conducted by the Bureau of Mines' "energy centers" and
synthane plant; and research in underground electric power
transmission.
Such functions of the National Science Foundation as relate to
development work in solar heating and cooling and geothermal
power.
Such functions of the Environmental Protection Agency as
relate to development and demonstration of alternative automo-
tive power systems and technologies to control emissions from
stationary sources asing fossil fuels.
The mission of NEC will be to insure the protection of the public
and environment against nuclear health and safety risks associated
with the use of nuclear materials and facilities and against unlawful
diversion of nuclear materials under regulatory control. The five-
member AEC, including its staff offices, licensing boards, and regula-
tory directorates, will form the nucleus of NEC, which will be an inde-
pendent regulatory commission responsible for licensing of civilian
use of nuclear power and materials.
The "Energy Reorganization Act of 1973" is designed to provide
the organizational base for a well-managed, centrally-directed attack
on energy problems in order to make this nation self-sufficient in clean
energy for the decades ahead.
The President has proposed a $10 billion program of energy R. & D.
at the rate of $2 billion a year for the next 5 years, commencing in
fiscal year 1975. Planning for these expenditures now is underway.
The Chairman of the Atomic Energy Commission, on the basis of a
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recent study, at the President's request, has developed recommenda-
tions for the 5-year R & D program encompassing practically all
known energy sources and potentials.
In his energy message to the Congress of November 8, 1973, the
President called for prompt action to establish ERDA as the admin-
istrative mechanism for continued planning and effective program
direction of the massive R & D effort required to meet the nation's
energy needs. H.R. 11510 responds to the President's request and ac-
cords with your committee's conviction, widely shared in the Congress,
that this nation must take all necessary steps toward national self-
sufficiency in energy.
There is a clear need for a reorganization of energy R & D func-
tions in the Federal Government to bring together separate, uncoordi-
nated, and fragmented efforts. The agency provided in this bill will
accomplish that objective and will give comprehensive and systematic
direction to solving the nation's energy problems.
The energy crisis demands concerted action on many fronts. There
are many legislative bills now being considered in various committees
of the Congress. H.R. 11510 is not an omnibus or all-encompassing
bill. It is not a substitute for, or alternative to, proposed legislation
in specific fields, such as nuclear plant siting, construction of deep-
water ports, regulation of strip mining, use of petroleum reserves, or
emergency conservation. H.R. 11510 is basically a reorganization bill
directed to the research and development part of the national effort
to overcome energy shortages, near-, middle-, and long-term.
Other reorganization undoubtedly will be necessary. In anticipation
of emergency legislation, the President has proposed creation of a
Federal Energy Administration, which is the subject of separate
legislation.
Your committee wishes to emphasize that the creation of a new Fed-
eral agency for energy conservation and related emergency measures
is not a substitute for, or an alternative to, the Energy Research and
Development Administration provided in H.R. 11510. The emergency
agency is concerned primarily with immediate fuel shortages and
energy conservation measures. The R & D agency is concerned pri-
marily with the middle- and longer-term energy problems. The two
agencies, when established, can be expected to work in complementary
fashion.
The organizational separation of licensing and related regulatory
functions in the nuclear field from energy research and development
responds to a different need and rationale. There has been a growing
criticism of the mixture of developmental and regulatory functions
within the AEC. The provision in H.R. 11510 for NEC to perform
exclusively the licensing and related regulatory functions should place
this whole matter on a sounder policy basis and should enable the
Commission to more effectively address the complicated, demanding
tasks of licensing nuclear plants, materials, and activities.
The testimony is compelling, and the President has recommended,
that the time required for construction and licensing of nuclear power
plants be substantially reduced. Informed witnesses before the sub-
committee pointed out that the time span for getting nuclear plants
into operation is as long as 10 years under procedures and circum-
stances that now prevail. Your committee is convinced that the time-
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scale for construction and licensing in this field must be cut down with-
out sacrificing safety and environmental considerations.
COMMITTEE AMENDMENT
In the course of subcommittee and committee consideration, several
changes were made in H.R. 11510. These are incorporated in a new
text in the form of a single committee amendment to H.R. 11510,
which strikes out all after the enacting clause and inserts the new
language. The committee amendment is shown in appendix 4.
COMMITTEE VOTE
H.R. 11510 was ordered reported unanimously by the committee on
December 5, 1973. The vote was 40 ayes and 0 nays. The vote by the
subcommittee on reporting the bill to the full committee also was
unanimous, with 12 ayes and 0 nays.
BACKGROUND AND HEARINGS
To understand the evolution of H.R. 11510, it is necessary to place
it in the context of broader reorganization proposals. In January
1971 the President proposed in his State of the Union message (sub-
sequently incorporated in draft legislation) four new departments to
replace seven existing ones in the executive branch.' One of these
was the Department of Natural Resources (DNR). It was to have five
component administrations, one of which was termed the Energy and
Minerals Resource Administration. This unit was to be charged with
policy formation and administration of the development and use of
national energy resources and technology. It was to be based largely
on existing energy functions within the Department of the Interior
plus the raw materials and uranium enrichment programs and sev-
eral other functions to be transferred from the Atomic Energy Com-
mission. It was to have policy, planning, and funding responsi-
bilities for civil nuclear power development as well as for non-nuclear
programs committed to its jurisdiction.
In June 1971 the Legislation and Military Operations Subcom-
mittee held overview hearings on the executive reorganization pro-
posals.2 About this time the President transmitted an energy message
to the Congress, which laid out the Administration's plans, as then
conceived, for development and conservation of energy resources. It
also called for a "single energy authority" in the DNR with "the
mission of insuring that the total energy resources of the Nation are
effectively utilized." 3 However, none of the President's proposals
for departmental reorganization reached the stage of floor considera-
tion in the House or Senate during the 92nd Congress.
In the 93rd Congress, commencing in January of this year, the
energy situation became more difficult, and numerous legislative bills
x House Doe. No. 92-1. January 22, 1971. See "Executive Reorganization : A Summary
Analysis," House Report No. 92-922, March 15, 1972.
2 "Reorganization of Executive Departments (Part 1-Overview)," hearings before a
subcommittee of the Committee on Government Operations, House of Representatives on
HR. 6959, H.R. 6960, H.R. 6961 and H.R. 6962 on June 2, 3, 7, 8, 14 and 16; July 1, 8,
22 and 27, 1971.
8 H. Doe. No. 92-118, June 4, 1971.
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on the subject were introduced. In an energy message to the Congress
on April 18, the President announced, among other things, that he
would submit legislation to establish a Department of Energy and
Natural Resources (DENR) based on the earlier proposal "with
heightened emphasis on energy programs." The new department, the
President explained, would provide governmental leadership for deal-
ing with the whole range of national energy problems and be respon-
sible for administering the national energy policy outlined in his
message.'
In the following months, draft legislation to create the DENR was
prepared by the Administration. By the time the legislation emerged
in mid-year, and partly as a result of suggestions by Chairman Holi-
field and other members of your committee, it became a two-part pro-
posal: Part A to establish a Deparlment of Energy and Natural
Resources (DENR), and Part lB to establish an independent Energy
Research and Development Administration (ERDA). The assort-
ment of energy functions in DENR was to be somewhat different
from that proposed for DNR in 1971. Generally, the departmental
component would emphasize data collection, conservation, and other
administrative or operating concerns in the energy field, and the inde-
pendent agency would emphasize energy research and development.
Uranium and thorium resource assessment functions would go over
to DENR from AEC, and in turn the primary fossil fuel research
and development functions of Interior would go over to ERDA.
The new R & D agency, in addition to acquiring the Office of Coal
Research and the energy research centers from the Department of the
Interior, was to absorb all the AEC functions except those relating to
licensing and regulation. The latter were to be assigned to a Nuclear
Energy Commission (NEC), which would be the AEC renamed,
smaller in size, and devoted exclusively to a licensing and regulatory
role,
The draft legislation was introduced (by request) by Chairman
ilolifield and Representative Frank Horton, ranking Republican
member of the committee. Hearings were held on this bill (H.R.
9090) in July and August,' and further hearings were planned.
As the energy crisis intensified, particularly with the Arab oil em-
bargo starting in October, your committee changed its legislative
plans. It was apparent that the two-part reorganization, involving
both DENR and ERDA, would entail extended hearings, particularly
because numerous organizations and interest groups were concerned
about one or another aspect of the agency transfers associated with the
proposed new department. Expeditious action in the energy field dic-
tated a separation of the two parts of the bill. The President recog-
nized the merits of this course in his energy message to the Congress
of November 8, in which he stated : 6
Because of the critical role which energy research and
development will play in meeting our future energy needs, I
4 H. Doc. No. 93-85, Apr. 18, 1973.
B "Department of Energy and Natural Resources and Energy Research and Development
Administration (Part 1)," hearings before a subcommittee of the Committee on Government
Operations, House of Representatives, on R.R. 9090, July 24, 25, 26, and 31 ; and August 1,
1973.
6 H. Doe. No. 93--187, Nov. 8, 1973.
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am requesting the Congress to give priority attention to the
creation of an Energy Research and Development Adminis-
tration separate from my proposal to create a Department
of Energy and Natural Resources. The new Administration
would direct the $10 billion program aimed at achieving a
national capacity for energy self-sufficiency by 1980.
H.R. 11510, by providing for the establishment of ERDA, gives the
priority attention requested by the President. The bill, based on Part
B of H.R. 9090, was prepared by your committee and its staff, in con-
sultation with expert staff from the General Accounting Office, the
Office of Management and Budget, the Atomic Energy Commission,
the Department of the Interior, and the Department of Justice. Many
hours of work, on an expedited basis, went into the consideration and
preparation of the bill. H.R. 11510 was introduced on November 15
by Chairman Holifield and Representative Horton, the ranking Re-
publican member of the committee; joined by Representatives
Price and Hosmer, the Chairman and ranking Republican member,
respectively, of the Joint Committee on Atomic Energy. Several iden-
tical or similar bills have been introduced with a total of 57 sponsors.
A list of the sponsors is contained in appendix 1.
Hearings on H.R. 11510 were held on November 27, 28 and 29 by
the Legislation and Military Operations Subcommittee. Testimony
was received from Roy L. Ash, Director of the Office of Management
and Budget; Dixy Lee Ray, Chairman of the Atomic Energy Com-
mission; John Whitaker, Under Secretary of Interior; and John A.
Love, then Director of the Energy Policy Office in the Executive Office
of the President. Also heard were Dr. Chauncey Starr, President of
the Electric Power Research Institute ; John W. Simpson, Vice Chair-
man of the Atomic Industrial Forum; Carl Bagge, President of the
National Coal Association ; John Partridge, representing the American
Gas Association; and Robert D. Partridge, Executive Vice President
of the National Rural Electric Cooperative Association.
Other witnesses included Dr. Robert G. Sachs, Director of the Ar-
gonne National Laboratory ; Dr. Harold M. Agnew, Director of the
Los Alamos Scientific Laboratory ; S David Freeman, Director of the
Ford Foundation Energy Policy Project; Professor John S. Steinhart
of the University of Wisconsin; Dr. Alvin Weinberg, Director (on
leave) and Floyd L. Culler, Acting Director, of the Oak Ridge Na-
tional Laboratory ; Ann Roosevelt, representing Friends of the Earth ;
Shearon Harris of the Edison Electric Institute; and James T. Ramey,
former Commissioner of the Atomic Energy Commission.
Members of Congress who testified were Mike McCormack and
Lawrence Coughlin.
Witnesses, with one or two exceptions, strongly favored enactment
of the legislation. The bill, in substance, was endorsed by organiza-
tions with such differing energy points of view as the Edison Elec-
trict Institute, the National Rural Electric Cooperative Association,
and the American Coal Association. In a few cases, reservations were
expressed abort one or another provision in the bill. Some of the wit-
nesses made helpful suggestions which were reflected in the changes
made in the bill.
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ERI)A ADMINISTRATIVE ORGANIZATION
ERDA wall be headed by a single Administrator, who, along with
a Deputy Administrator, will be appointed by the President by and
with the advice and consent of the Senate. They will be compensated
,at levels II and III, respectively, of the Executive Schedule. The
Committee expects that the Administrator, and the Deputy, will be
principally concerned with setting R & D policy and with the overall
direction and management of the agency.
Under the Administrator, there will be five Assistant Administra-
tors, who, respectively, will head the following five major missions of
ERDA: (1) fossil energy development; (2) nuclear energy develop-
ment; (3) research and advanced energy systems? (4) environment,
safety, and conservation; and (5) national security. These five As-
sistant Administrators also will be appointed by the President by
and with the advice and consent of the Senate, and will receive com-
pensation at the rates prescribed for positions at level IV of the
Executive Schedule.
The individual program management responsibilities of each of
these Assistant Administrators should assure strong leadership and
clear-cut accountability for achievement of specifically assigned objec-
tives. Their equality of rank, and the statutory basis for their admin-
istrations, will emphasize the intent of the bill to give full attention
and appropriate emphasis to the different energy sources and poten-
tials and to environmental, safety, and conservation aspects.
The development of fossil fuels, for example, will get the same
degree of leadership drive and direction that will be bestowed on
continuing efforts to advance nuclear technology. At the same time,
solar, geothermal, and other energy sources and advanced energy sys-
terms will be investigated with required intensity and motivation.
Your committee does not expect, of course, that all energy program
areas will be equally funded. The budget requests should be based on
the best available information and judgment as to the relative merits
and possibilities for gaining usable energy within given time frames
and within economically and environmentally acceptable bounds.
At the next lower level, level. V of the Executive Schedule, there
will be additional officers, not exceeding seven in number, and a Gen-
eral Counsel. These officials will be appointed by the Administrator.
A chart reflecting the present views of the Office of Management
and Budget concerning the probable alignment of ERDA's functions
is shown in appendix 3-A to this report.
Pursuant to subsection 106(d) of the bill, the Administrator may
organize ERDA as he deems necessary or appropriate, subject to cer-
tain exceptions. The exceptions are the provisions in section 102
regarding the offices and responsibilities of the Deputy Administrator
and the five key Assistant Administrators; the provisions in section
102 regarding the General Counsel, the additional officers, and the
Division of Military Application ; and the provisions in subsection
104(b) for the transfer from the Atomic Energy Commission of the
General Advisory Committee, the Patent Compensation Board, the
Division of Military Application, and the Division of Naval Reactors.
It is intended that the Military Liaison Committee, established pur-
juant to section 27 of the Atomic Energy Act of 1954, as amended,
serving as a liaison body between the. Department of Defense and
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Atomic Energy Commission, continue to perform its functions, without
change, in relation to DOD and ERDA.
There are two points that the committee wishes to stress about the
administrative organization of ERDA :
First, the bill seeks a reasonable balance between the broad dis-
cretion accorded the Administrator under subsection 106(d) to
organize ERDA as he deems appropriate, and the statutory pre-
scription for at least the fundamental outlines of the administra-
tive organization and the desired qualifications on the administra-
tive discretion specified in section 102 and subsection 104(b).
Your committee considers it likely that management, administra-
tive, and program experience will suggest the need for organiza-
tional changes from time to time. To the extent that these require
legislative action, the committee expects that the Administrator
will promptly advise the Congress of his recommendations.
Second, the committee urges the President and the Administra-
tor to be mindful that a good organization also needs good people.
It is your committee's judgment, and we strongly recommend,
that the Administrator, the Deputy Administrator, and the five
high-level Assistant Administrators be carefully selected on the
basis of outstanding ability, integrity, and dedication generally
acknowledgedby their peers. The positions of Administrator and
Deputy Administrator are particularly sensitive in insuring that
management of the agency is effective, and that its R & D policies
and programs are soundly conceived and well executed. We would
expect that appointees to these positions will have broad
background and experience in the management of research
and development programs, and that the qualifications of the
appointees will complement and reinforce each other. Your com-
mittee believes it particularly important that the top management
of the agency not be preoccupied with a single-energy technology
or enterprise.
In selecting the Administrator, Deputy Administrator and Assist-
ant Administrators, your committee expects further that the Presi-
dent will give consideration to the views and recommendations of
public interest groups and individuals from scientific, consumer, en-
vironmental, conservation and energy communities.
Your committee expects that officers and personnel will be selected
on a best-qualified basis. As indicated below, personnel will be em-
ployed under the system provided for in subsection 161d. of the Atomic
Energy Act of 1954, as amended, a system specifically designed to help
insure the availability to the Commission of individuals of the highest
caliber. Additional information on personnel aspects of H.R. 11510 is
given in appendix 2.
Outstanding leadership at the top levels of ERDA will attract and
inspire able personnel, as well as instill public and congressional con-
fidence in the conduct of ERDA's affairs.
ERDA MISSIONS
ERDA's missions will include the following :
R & D on all forms of energy
ERDA will exercise central responsibility for policy planning, man-
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ing all energy sources either transferred to ERDA pursuant to this
bill, or otherwise initiated by ERDA, as contemplated by this bill.
The scope of possible energy sources and utilization techniques that
ERDA may explore will be virtually unbounded. It will include, but
not be limited to, solar, tidal, wind, hydrogen, geothermal (using
natural steam, hot dry rock., water injection and other techniques),
and nuclear fusion. It will cover new directions as yet unvisualized.
The vigorous pursuit of all promising energy sources and technologies
will be a major ERDA mission under this bill.
ERDA's responsibilities with respect to energy sources and utiliza-
tion technology will encompass advances in extraction (on land and
undersea)? conversion, storage, transmission and utilization technol-
ogies. Significant advances in, all of these areas will be necessary. For
example, it is clear that there will be a critical need to develop new
methods of economical, low line-loss underground power transmission
capable of handling the augmented power levels that will be required
in the future. One of the promising approaches involves cooling the
cables to temperatures near absolute zero. Such superconducting cables
should be able to transmit electric power in virtually unlimited quanti-
ties. The development of useful means of storing electric energy would
provide large economic benefits, help pollution control, and make
more central station power readily available when and where needed.
As a practical matter, your committee recognizes that achievement
of national self-sufficiency in energy at the earliest practicable date
clearly demands a sharp upsurge in coal R & D. Coal is our most
abundant fossil fuel reserve. We appear to have about half the world's
supply. Coal is located in quantity in many areas throughout the
country. Properly developed and converted to gaseous, liquid, and
other environmentally acceptable forms, coal will materially help us
reach a plateau of energy self-sufficiency at the earliest practicable
date.
Also, in the near-term perspective. considerable technology in solar-
energy utilization for residential purposes appears to be available
and deserves R & D attention. Professor John S. Steinhart, of the
University of Wisconsin testified that residential heating and hot
water consumed more than 13 percent of the fuel in this country.
Your committee believes that attainment of an initial plateau of en-
ergy independence undoubtedly will not be the full answer to our
energy problem. And this plateau may well be a tentative one in con-
text of the health, social, employment, and industrial needs of our
people, including the continuing important objective of safeguarding
and improving the quality of our environment.
Therefore, your committee has seen to it that under this bill, ERDA's
essential long-range responsibility will be the determined pursuit of
the crrail of a virtually inexhaustible supply of energy that can be
widely utilized for the common good without harmful environmental
impact. Your committee believes this grail must be sought and, unlike
the legendary holy vessel, will be found-perhaps through break-
throughs in solar research, in fusion or other nuclear programs, in
geothermal processes, or in other R & D directions not yet pointed to
by present knowledge.
Meanwhile, and probably until the end of this century, indications
are that we will need to use all available, environmentally acceptable
forms of energy that we can develop.
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Conservation R e D
ERDA's basic responsibilities will include the encouragement and
conduct of R & D for the conservation of energy. This is an important
aspect of an effective total R & D response to our energy problem. It
encompasses techniques to utilize energy efficiently and to minimize
wasteful use. The R & D may be directed, for example, toward
advances in kinds of insulation, in structural and equipment designs,
in manufacturing methods, and in recycling concepts.
Efficiency and Reliability R d D
ERDA's R & D responsibilities are intended to encompass efforts
aimed at increasing the efficiency and reliability of use of energy
sources and energy-utilizing equipment and devices. Efficiency and
reliability objectives are closely akin to conservation.
Environmental Research
The need to protect and improve our environment will be an integral
part of ERDA's missions. The environmentally-related functions
transferred from the AEC and EPA will provide a strong base for
the continuation and acceleration of this vital research area.
Nuclear Production, Enrichment, and Distribution Activities
ERDA will continue to perform the nuclear production, enrichment
and distribution functions of the Atomic Energy Commission. These
functions are of first-rank importance, not only in context of the
energy problem but from the standpoint of common defense and secu-
rity. They pertain to special nuclear material (plutonium, and uranium
enriched in the isotopes 235 and 233), source material (uranium and
thorium), byproduct material (material made radioactive by ex-
posure to radiation in connection with producing special nuclear
material), heavy water tritium and other materials. They also involve
unique facilities included in the transfer from the Atomic Energy
Commission, and have both domestic and international relevance. The
AEC's transferred production facilities and research facilities are
valued at approximately $9 billion.
The most important and complex phase of the nuclear fuel chain
is the process of separating .the isotopes of naturally occurring ura-
nium (source material) to create a product with increased (enriched)
fissionable uranium-235 (special nuclear material). Five countries-
the United Kingdom, France, China, the Soviet Union, and the United
States-have facilities (gaseous diffusion plants) capable of perform-
ing this function. Only the United States currently provides enrich-
ment services to other nations on a large-scale commercial basis.
Domestically, the enrichment service is the only processing step in
the nuclear fuel-cycle chain which private industry has no capability
to perform. The exclusive capability to carry out this key step, which
is indispensable to the production of fuel for nuclear powerplants and
of weapon materials, is included in the transfer of the AEC's
functions.
Reactor Development and Naval Reactor Activities
ERDA will continue to conduct the AEC's functions in regard to
reactor development and naval reactor activities. Foremost in the
current posture of the long-range developmental effort on nuclear
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power plants is the breeder reactor, a power plant that will "breed"
more nuclear fuel than it consumes. The liquid metal fast breeder, the
breeder assigned the highest priority, will utilize a high-temperature
system capable of operating at thermal efficiencies greater than the
present generation of commercial water-cooled reactors. This will
result in less waste heat being dicharged into the environment.
Earlier this year, the AEC entered into a definitive cooperative
arrangement with two utilities--the Commonwealth Edison Company
and the Tennessee Valley Authority-and two non-profit corpora-
tions-the Breeder Reactor Corporation and the Project Management
Corporation--for the design, construction and operation of this Na-
tion's first LMFBR demonstration plant. The powerplant will have
a generating capacity of 400,000 kilowatts and will be built on a site
near Oak Ridge, Tennessee. Initial plant operation is scheduled for
1979.
The AEC',s LMFBR activities include an extensive effort in plant
design, operation, reactor fuels and materials, physics, chemistry,
instrumentation, components and other fields.
This key program utilizes a number of major facilities, including
the Fast Flux Test Facility under construction near Richland, Wash-
ington, the Liquid Metal Engineering Center near Canoga Park, Cali-
fornia, and Experimental Breeder Reactor No. 2 at the AEC's
National Reactor Testing Station in Idaho. All these facilities are
embraced by this transferred function.
The AEC's important work on other advanced reactor concepts,
such as the high-temperature gas-cooled reactor, the gas-cooled fast
reactor, and the molten salt breeder reactor, is also part of the trans-
ferred reactor development functions.
The naval propulsion reactor program is a joint program of the
AEC and the Department of the Navy. ERDA will assume AEC's role,
which is carried out by the Di aision of Naval Reactors and relates
to the design, development and improvement of naval propul-
sion plants and reactor cores for installation in ships ranging Ili
size from small submarines to large combat surface ships. The Divi-
sion of Naval Reactors is also responsible for maintenance, operation
and safety of the nuclear propulsion plants, as well as the selection
and training of the necessary personnel.
Your committee is well aware that the Division of Naval Reactors'
early work in reactor development provided the technological base
for the civilian nuclear powerplants currently in use. Your committee
also knows that this Division has trained many of the engineers and
technicians now engaged in the design., manufacture or use of nuclear
plants for generating central station power on utility systems.
The Division of Naval Reactors is currently conducting a light-
water breeder reactor project, aimed at determining the capability of
breeding in a pressurized water reactor. This is still another important
part of the AEC's developmental mission in regard to breeder reactors.
The outstanding success of the Naval Reactors Division, from the
standpoints of both the civilian reactors program and the common
defense and security, is well known. The dual scope and contributions
of this program in classified and non-security areas continue. Your
committee wants to express clearly its conviction that if the functions
of the Naval Reactors Division 'had not been under the jurisdiction of
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the AEC, most of its accomplishments in both the peaceful and naval
ships areas probably would not have materialized.
Biomedical and Physical Research
ERDA will inherit the AEC's biological, medical, and ecological
research programs that have been in existence for 25 years. They have
provided a valuable body of information and tools to further health
care, help develop useful applications of radiation and nuclear tech-
nology, assist the environmental missions of the AEC, and evaluate
the possible hazardous effects of nuclear developments on man and the
environment.
ERDA also will assume the AEC's role in connection with its physi-
cal research program, a long-range basic research effort to further
man's understanding of the natural laws and phenomena governing
matter. Both theoretical and experimental research, and work in the
fields of high-, medium-, and low-energy physics are conducted.
Chemistry, metallurgy, properties of materials, and mathematics and
computers fall within the purview of this research effort.
Last year two new unique facilities went into operation, increasing
the number of national complexes that form part of the AEC's physi-
cal research program :
(a) The National Accelerator Laboratory at Batavia, Illinois,
produced the first 200 billion electron volt beam and several
months later doubled this energy-five times greater than the
highest proton energy previously reached by any accelerator in
the world. The NAL is operated for the AEC by the Universities
Research Association, a consortium of 34 major American and
Canadian universities.
(b) The Clinton P. Anderson Meson Physics Facility at Los
Alamos, New Mexico, achieved a low-intensity 800 million electron
volt proton beam. This accelerator, operated by the University of
California, will provide negative ions for cancer treatment, and
it will be used for research in nuclear physics, nuclear chemistry,
elementary particle physics, and nuclear weapons.
Physical research has relevancy to more advanced energy R & D,
since it seeks to unravel the secrets of the smallest units of matter-
energy.
Fusion RdD
The fusion program was spawned by the nuclear weapons work
and later spun off from the physical research program to emphasize
its importance and accelerate its development. Controlled thermonu-
clear reaction, or fusion, is the process by which nuclei of light ele-
ments collide at high velocity and fuse to form heavier nuclei, thereby
releasing energy. The sun's heat is an example of the fusion process.
Present expectations generaly point to the year 2000 as the earliest
time when economic fusion power.could be available.
The basic requirements for achieving useful power from a fusion
reactor are: (a) to heat a fusion fuel to a temperature of hundreds
of millions of degrees (plasma) ; (b) to confine the plasma, so that it
does not contact any natural walls or impurities, long enough for the
fuel to react; and (c) to extract the released energy and convert it to
a useful form. The AEC's comprehensive fusion program is a major
component of the functions transferred to ERDA.
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Military Application
The AEC's functions respecting the development and production of
nuclear weapons will be continued by ERDA.
The AEC conducts the research and testing basic to the design and
development of new and improved nuclear weapons systems and manu-
factures nuclear weapons and devices. It improves the stockpiled weap-
ons through modifications, carries out quality assurance testing of
new devices, assesses weapon reliability, and produces training ma-
terials and devices.
Nuclear weapons R & D is conducted primarily by three major
laboratories of the AEC: Los Alamos Scientific Laboratory at Los
Alamos, New Mexico; the Sandia Laboratories at Albuquerque, New
Mexico; and the E. O. Lawrence Livermore Laboratory at Livermore,
California.
During the past quarter-century there has been a close bene-
ficial interrelationship between nuclear weapons R & D and peaceful
application purposes. It has taken two forms-technological "spinoffs"
and ongoing dually-useful R & D.
Technological "spinoffs" continue to come quickly from the AEC's
weapons 11 & D program. They include such major developments as
the subterrene, a device for ;penetrating deeply into earth without
drills. The device melts the underlying rock and creates a hole neatly
walled in by congealment of the melted material. Experiments to date
have achieved penetrations in rock to depths of 85 feet. This device
will be invaluable for oil exploration and extraction, for geothermal
mining, and other purposes.
Another recent ":spinoff" is a sea ice, penetrator, a device capable of
remotely measuring the thickness of sea ice. The device is dropped
from aircraft, and, as it penetrates the ice, it transmits data which are
later used to compute ice thickness.
Still another recently-developed device resulting from R & I) on
nuclear weapons is a tool that can measure the thickness of materials
without touching them. Its accuracy is greater than one-tenth the
thickness of a human hair. Measuring without contact is particularly
important when applied to materials that can be damaged by contact.
Many R S, D activities in AEC laboratories are beneficial for both
weapons and civilian purposes,. This mutual benefit occurs naturally
and inevitably because the same laboratory, the same scientists and en-
gineers, the same equipment, tools, computers, and instrumentation,
are used for both purposes under the laboratory's assigned respon-
sibilities.
Your committee is aware of arguments for a complete separation
between military application activities and R & D for peaceful pur-
poses. The military part, presumably, would go to DOD and the
civilian aspect to ERDA. However, precipitate divorce would cause a
serious setback to the energy and other goals of ERDA as well as to the
common defense and security. The finely-tuned balance of relative
priority and emphasis in regard to each dually-valuable task would
suddenly change, and the spirit and motivation of the scientists and
technicians would seriously suffer because of their reassignment, even
though much of the same work could contine through inter-agency
agreements.
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Your committee is keenly aware also that it would be extremely
difficult to redesign the security system of "Restricted Data" provided
for in the Atomic Energy Act, if there were a split of security-related
responsibilities between ERDA and the DOD. This security system
now is applicable to civilian-related functions, such as the use of spe-
cial nuclear material in the production of atomic energy, as well as
to atomic weapons.
These matters are of the utmost importance. They must be con-
sidered carefully before any conclusions are reached about a transfer
to DOD. Subsection 306 (b) of the bill explicitly provides that during
the new agency's first year of operation, the Administrator, in collabo-
ration with the Secretary of Defense, shall conduct a thorough review
of the desirability and feasibility of transferring to the Department
of Defense (or any other Federal source) the functions of the Admin-
istrator respecting military application and restricted data. This sub-
section further provides that within one year after the Administrator
first takes office, he shall make a report to the President for submission
to the Congress setting forth his comprehensive analysis, the principal
alternatives and the specific recommendations of the Administrator
and the Secretary of Defense.
In concluding its comments on the weapons program, the committee
wishes to respond to a request by Dr. H. M. Agnew, the Director of
the Los Alamos Laboratory, in his testimony before this committee
on November 29, 1973. Dr. Agnew stated :
I urge that you specifically designate that the Director of
Military Applications be at the three-star rank. I believe this
is very important since the DOD officials with whom he has to
interact are at that level, and I believe the caliber of officers
who will be available to the Administration will be better
qualified at this rank. A Brigadier or Major General equiva-
lent who wishes to further his military career is at a decided
disadvantage in questioning some of the requirements imposed
upon him by his DOD counterparts who are at the three-star
level.
The committee believes this recommendation makes good sense, and,
in turn, recommends that the head of this important statutorily-desig-
nated division be at the three-star rank.
Other AEC Functions
The other AEC functions that ERDA will assume include nuclear
education; training and fellowship activities; cooperative university-
AEC laboratory research program; nuclear waste management; the
raw materials program; production and sale of special radioisotopes
and heavy water; international activities; health and safety research;
operational safety; AEC's responsibilities under the Atomic Energy
Community Act of 1955, as amended; the technical information pro-
gram ; and the nuclear and non-nuclear applied technology program
(e.g., nuclear gas stimulation activities, geothermal resource develop-
ments, high-capacity power transmission, and advanced batteries for
energy storage).
ERDA also will assume AEC's basic responsibility for security.
This pertains to the safeguarding of special nuclear materials against
diversion from peaceful to weapon uses, to declassification activities
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and the safeguarding of restricted data, and to other security aspects
of the provisions of the Atomic Energy Act of 1954, as amended.
FUNCTIONS TRANSFERRED TO ERDA
The bill transfers to and vests in the Administrator all functions
of the Atomic Energy Commission other than its licensing and related
regulatory functions.
The bill also transfers to and vests in the Administrator functions
from three sources described below.
(1) Functions of the Department of the Interior relative to the
Office of Coal Research: to fossil fuel energy research and develop-
ment programs and related activities conducted by the Bureau of
Mines "energy centers" and synthane plant; and to underground elec-
tric power is^ans'in esion research.
Major programs of the Office of Coal Research include conversion
of coal to liquid fuels and to high BTU pipeline gas and to low BTU
gas for industrial use; also improved. combustion and clean, efficient
conversion of coal to electricity by advanced power systems. The func-
tions of the office are to be transferred in their entirety. The resource
level for these functions in fiscal year 1974 includes*
ncludes $94 million in
obligations, $79 million in outlays, and 55 permanent positions. The
President has requested supplemental funds for fiscal year 1974 in the
amount of SS28.2 million in budgetary authority and $10 million in
outlays. According to the OMB, 55 additional positions would be
needed to conduct this accelerated program.
The Bureau of Mines facilities comprise. 22 field laboratories and a
synthane plant. Six of the laboratories and the synthane plant are
devoted to energy R & D and would be transferred to ERDA. The six
laboratories are engaged in R & D on numerous aspects of production,'
conversion, and utilization of fossil finals-coal, eas. oil and oil shale.
The synthane plant is a coal gasification pilot plant, now under
construction. The fiscal year 1974 resource level of the Bureau of Mines
functions to be transferred is $21 million in obligations, $16 million in
outlays, and 715 permanent positions.
The activities remaining in the Bureau of Mines are, for the most
part, not energy-related in an R & D sense. Energy-related work which
will remain in the Bureau includes some of the mining technology
research activities. Expertise in this area is essential for mining health
and safety research and provides support required to avoid disrup-
tion of the Bureau's remaining program. This work will not be trans-
ferred because of its intimate relationship to other mining technologies.
The non-energy R & D involves metals and other ores not used as
energy sources and therefore is not appropriate for transfer.
The Bureau's program for underground electric power transmission
research is conducted in cooperation with the Electric Power Research
Institute on a cost-sharing basis (60--80 percent industry and 20-40
percent Government). Contract research, in cooperation with the Elec-
tric Power Research Institute, is conducted by commercial organiza-
tions, educational institutions, nonprofit research organizations, and
governmental anene>s whore expertise exists.
The fiscal year 1974 resource level for transmission research in-
cludes $1 million in obligations, $1 million in outlays, and five per-
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manent positions. A supplemental appropriations request of $1.25
million in budgetary authority and $0.8 million in outlays for fiscal
year 1974 has been sent to the Congress by the President. The requested
increase is to support an accelerated R & D effort, primarily in the areas
of underground transmission, in conjunction with projects approved
by the Electric Power Research Institute. An additional three positions
would be needed to carry out this accelerated program.
(2) Functions of the National Science Foundation relating to solar
heating and cooling development, and to geothermal power
development.
Specifically, it is proposed that the program leading to the develop-
ment and demonstration of "heating and cooling of buildings" with
solar energy be transferred to ERDA. This program seeks to demon-
strate the technology necessary to produce economically feasible sys-
tems for heating and cooling buildings. The program is being con-
ducted by grants and contracts in which the major performers are
universities, complemented by private industry, national laboratories,
and nonprofit institutions. For fiscal year 1974 these projects involve
obligations of $3 million and outlays of $3 million.
The NSF geothermal energy program to be transferred to ERDA is
designed to exploit alternative sources of geothermal energy. For fis-
cal near 1974, obligations and outlays will be $0.5 million each.
It is anticipated that NSF will continue to support long-range re-
search on advanced concepts in selected energy areas. In particular,
NSF-with its strong ties to universities-will draw on their ca-
pabilities to produce new ideas and concepts to insure that all good,
competitive ideas meriting support are pursued.
Basic research will continue under NSF sponsorship in solar, geo-
thermal, and other areas, such as pursuing energy, systems studies re-
lated to supply and demand for energy within the economy and energy
conservation; investigating novel techniques to transport energy from
production sources to consumption sites; investigating improved meth-
ods for converting energy from one form to another; and discovering
methods to more effectively manage and utilize conventional energy
sources.
The fiscal year 1974 resource levels for the energy research pro-
grams remaining in NSF are as follows : obligations and outlays of $10
million each for advanced concepts research utilizing solar energy;
obligations and outlays of $3 million each for advanced concepts in
geothermal energy ; and obligations and outlays of $8 million each in
long-range and basic energy research.
(3) Functions of the Environmental Protection Agency (EPA)
relating to the development and demonstration of alternative auto-
motive power systems, and to the development and demonstration
of precombustion, combustion, and postcombustion technologies to
control emissions of pollutants from stationary sources using fossil
fuels.
The goal of the Alternative Automotive Power Systems (AAPS)
research is to demonstrate the feasibility of alternative systems to
power automotive vehicles which (a) would meet or exceed Federal
emission standards, and (b) would achieve greater fuel efficiency. At
present the AAPS program is pursuing the development and demon-
stration of the Brayton cycle (gas turbine) and Rankine cycle (steam)
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engine systems, and (with Army) the stratified charge concept, all
of which have high potential for meeting emission standards with ac-
ceptable fuel economy.
The AAPS program would be transferred to ERDA almost in its
entirety. Thy, fiscal year 1974 resource level includes $7 million in ob-
ligations, $9 million in outlays, and 12 permanent positions. An equal
number of positions will remain in EPA to give EPA a continuing
assessment capability which is necessary to the discharge of its regula-
tory responsibilities.
The program in emission control technology involves R & D to con-
trol emissions to the atmosphere, whether such emissions result (a)
from burning fossil fuels to produce energy (notably generation of
electricity and production of heat and process steam) or (b) from
other processes (e.g., copper smelting, paper manufacture) which
produce atmospheric pollutants. EPA would retain a significant tech-
nology assessment capability to enable it to discharge its regulatory
responsibilities. The fiscal year 1974 resource level for the portion to
be transferred includes $6 million in obligations $6 million in outlays,
and 18 permanent positions.
The rest of the program would remain in EPA because it deals
with control of emissions to the atmosphere other than those resulting
from energy generation (e.g., electricity and process steam). The 1974
resource level associated with this portion of the program comprises
$9.4 million in obligations and 72 positions.
The above-described transferred functions will enable ERDA to
get underway with a considerable array of our nation's best R & D
talent and facilities. The AEC will bring to the new agency its exten-
sive network of national laboratories and facilities valued at about $9
billion, its broad-gauged scientific and technical expertise, and the
benefit of its experience in managing large, innovative technological
enterprises. Other transferred functions will contribute experts in
fossil fuel. development, automotive power systems, and additional
fields. The amalgamation of these national assets will be a solid
foundation for ERDA's swift expansion into every promising energy
technology.
At the start, ERDA will have a gross outlay level of about $3 bil-
lion and a personnel complex of 6,700. It will increase in size substan-
tially as it mounts R & D efforts along many energy avenues.
Your committee regards the totality of ERDA's acquired functions
as a good base. The transferred activities encompass many, but not all,
of the Government's R & D efforts relating to sources of energy and
utilization technology. In regard to so-called pure or basic research,
your committee does not advocate that all such research that may
be thought to have some relation to energy technologies be transferred
to ERDA. That would be impractical, prejudical to the conduct of
worthwhile research generally, and detrimental to performance of
important functions of other agencies.
Nor does your committee believe that each and every applied R & D
task that may fall within the broad areas of responsibility described
in section 102; of the bill must necessarily be under the direct aegis of
ERDA. For example, EPA may well require, as directly incident to
the proper discharge of its duties, the conduct of R & D for which it
considers it must assume responsibility, though the work may fall
within a broad energy area of interest to ERDA.
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In regard to fossil fuels, your committee believes it is appropriate
that R & D on near-term improvements in coal mining techniques and
machinery continue to be performed under the direction of the De-
partment of the Interior in view of the Department's interrelated
statutory responsibilities for health and safety. On the other hand, the
functions transferred to ERDA from the Department of the Interior,
and ERDA's overall functions under this Act, will encompass the de-
velopment of advanced improvement concepts in such areas.
Subject to these considerations, your committee urges that from
time to time the R & D functions of the Government pertinent to
ERDA's broad energy-related missions be reviewed with an eye
toward determining which may be appropriately transferred to
ERDA, pursuant to applicable law or by supplemental legislation. In
any case, basic research and applied work of interest to more than
one Federal agency must be continuously the subject of close coordina-
tion to avoid wasteful duplication and information gaps.
ERDA's AUTHORITY
The "Energy Reorganization Act of 1973" establishes a broad char-
ter of authority for the exercise of ERDA's functions. It is your com-
mittee's judgment that, in regard to ERDA's non-nuclear functions,
the Administrator should have a scope of authority under this bill,
with a built-in range of flexibility, generally similar to that now appli-
cable to the performance of the AEC's non-regulatory functions under
the Atomic Energy Act of 1954, as amended, and other applicable
laws.
In regard to nuclear activities, the provisions of the Atomic Energy
Act of 1954, as amended, and other authority applicable to such nu-
clear activities, will continue to govern the performance, of ERDA's
functions, subject to the technical or perfecting modifications effected
by the bill (e.g., the provisions of section 202 and subsection 301 (a) ).
Your committee believes that the experience gained in administer-
ing and construing these statutes, starting more than 25 years ago,
has served to create an extensive body of understanding of this leg-
islative regime and a general sense of confidence in its inherent sound-
ness. Your committee has reason to believe that the Joint Committee
on Atomic Energy, in connection with its congressional responsibilities
pursuant to chapter 17 of the Atomic Energy Act, shares this view.
There are several matters pertaining to ERDA's authority that your
committee wishes to stress :
Definition of Research and Development
Your committee endorses the connotation of "research and devel-
opment" delineated in the Atomic Energy Act of 1954, as amended,
(and previously in the 1946 Act). Subsection 11x: of that Act defines
the term to mean "(1) theoretical analyses, exploration, or experi-
mentation: or (2) the extension of investigative findings and 'theories
of a scientific or technical nature into practical application for experi-
mental and demonstration purposes, including the experimental pro-
duction and testing of models, devices, equipment, materials and proc-
esses." In essence, the R & D spectrum extends from pure or basic
research through demonstrations of commercial or industrial applica-
bility.
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Training and Limited Educational Activities
Your committee points out that ERDA is empowered to use the
authority of chapter 4 of the Atomic Energy Act of 1954, as amended,
in relation to non-nuclear as well as nuclear activities. This authority
includes "training activities" of non-Government people. Additionally,
chapter 4 has been construed to enable carefully-dimensioned educa-
tional programs. Your committee intends that ERDA will have sim-
ilar discretion in its non-nuclear work.
Information anul Transfer of Know-How
The provisions of the "Energy Reorganization Act of 1973" in regard
to dissemination of information are intended to parallel and be con-
sistent with the requirements of the Atomic Energy Act of 1954, as
amended. If, for example, information or other matter constituting
restricted data (as defined in subsection 11y. of the Atomic Energy
Act) is encountered in non-nuclear activities, the provisions of the
Atomic Energy Act of 1954, as amended, will remain applicable to
all security aspects. The normal transfer of developed information to
the private sector and to the public generally will continue. Every
reasonable effort should be made to speed transfers to the public
domain.
With respect to transfers of know-how and data to industry, small
businesses, and others, to further possible interests outside of ERDA's
programmatic spheres, your committee intends that ERDA be guided
by the procedures employed by the AEC. They were carefully designed
to preclude favoritism and unfair advantage; to provide a fair system
for cost recovery; and to implement section 33 ("Research for Oth-
ers") of the Atomic Energy Act of 1.954, as amended, in an appro-
priate manner.
Contractual and Other Matters
The Administrator is empowered to make suitable arrangements for
the conduct of R & D activities with private or public institutions or
persons. This authority is similar to and compatible with the provisions
of chapter 4 of the Atomic Energy Act of 1954, as amended. Public
Law 55-934, the grant act, and other statutory authority also will be
available for non-nuclear programs as they are for nuclear activities.
Thus, ERDA will be fully authorized to make arrangements on
the outside--with individuals, industrial and commercial firms, edu-
cational institutions, public and private bodies, hospitals, not-for-
profit companies, and other legal entities. In addition, ERDA will
utilize the contractor-operated national laboratories included in the
transfer from the AEC and those in-house capabilities of the Bureau
of Mines included in the transfer from the Department of the Interior.
Your committee expects that the management and control of all of
ERDA's activities will be firmly in the hands of the Administrator
and his principal assistants. The agency must be adequately staffed
with able executives, scientists, and engineers who are thoroughly
qualified to supervise and evaluate performance and results. Man-
agement and control must not be contracted out.
Your committee further expects that ERDA's contracting proce-
dures and practices, with relatively few exceptions, will commonly
apply to both nuclear and non-nuclear activities. ERDA should
be able to use to good advantage the types of cooperative arrangements,
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inter-Federal agency agreements, special research agreements with
educational institutions, and other commitments that the AEC has
successfully employed.
Patents
The bill does not change existing patent laws. The provisions of
chapter 13 ("Patents and Inventions") of the Atomic Energy Act
of 1954, as amended, remain unaffected by the provisions of this bill.
In the course of hearings on this bill, a suggestion was made that
ERDA should establish an office to help individual inventors or small
companies by advising them whether their inventions or discoveries
might be useful in connection with ERDA's missions. Your committee
believes this suggestion may have merit and requests that the Admin?
istrator consider it.
Personnel
As previously stated, your committee stresses that all officers and
personnel of ERDA should be selected on a best-qualified basis. Except
for the officials appointed by the President, all officers and employees
of ERDA, including all personnel transferred from other Government
agencies, will be appointed, employed, and receive compensation fixed
under the personnel system authorized by subsection 161d. of the
Atomic Energy Act of 1954, as amended.
The intention of Congress underlying subsection 161d. was to assure
that the AEC would have sufficient flexibility to attract personnel of
the highest caliber for the effective conduct of large-scale, complex
operations. This authority has helped create a merit employment sys-
tem that provides fair and equitable treatment to employees and
candidates for employment. Your committee urges that ERDA ad-
here rigorously to the application of this merit system.
Advisory Committee on Reactor Safeguards
The ACRS will remain with the Nuclear Energy Commission. It
is intended, however, that the Administrator may call upon the ACRS
to perform such of the activities contemplated by section 29 of the
Atomic Energy Act of 1954, as amended, as relate to functions trans-
ferred from the AEC. Your committee also expects that the Nuclear
Energy Commission will render advice to ERDA from time to time,
as the Administrator may request.
Consultation and Coordination
In order for the Administrator to exercise central responsibility for
policy planning as contemplated by the Act, it will be imperative, in
your committee's judgment, that the Administrator be able to report
directly to the President or to such energy policy officials or council as
may be designated pursuant to applicable authority for such purpose.
The Administrator also will need to consult with industry repre-
sentatives, with public agencies, and with others, from time to time,
and to help others coordinate their energy-related R & D efforts with
ERDA's programs.
Your committee wishes to make it clear that the Administrator,
within the context of the powers and duties prescribed in the bill, and
specifically under subsection 107(g), will have ample authority to
consult with all relevant organizations, groups, and individuals, and
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to establish such advisory mechanisms as he deems appropriate. Con-
sidering the multiple sources, potentials, institutions and enterprises
for energy research and development, the Administrator will need,
and undoubtedly will seek, advice from many informed sources.
NUCLEAR ENERGY COMMISSION
The licensing and related regulatory functions remain with the Com-
rniasion, which is renamed the Nuclear Energy Commission. The Com-
mission will continue to carry out those functions under pertinent
provisions of the Atomic Energy Act of 1954, as amended, as specified
in a separate section of this report.
The facilities of the development-operation side of the AEC are not
subject to licensing and related regulatory provisions of the Atomic
Energy Act. The development-operations programs have had excep-
tionally good health and safety experience. Notwithstanding this,
your committee concluded that upon the separation of the functions of
the AEC pursuant to this bill, it would be useful to provide for the
licensing of ERDA-owned facilities in two respects: (1) nuclear dem-
onstration reactors that would be operated as part of a utility's power
generating facility; and (2) facilities used primarily for the receipt
and storage of high-level radioactive wastes resulting from licensed
activities. Your committee believes that this change in the Atomic
Energy Act would be a logical amendment in view of the direct link
with utility generating facilities.
Section 203 provides that the Nuclear Energy Commission "may
engage in or contract for research which the Commission deems neces-
sary for the discharge of its licensing and related regulatory func-
tions."
Section 203 further provides that ER DA. and other Federal agencies
shall cooperate with NEC, and shall furnish, on a reimbursable basis,
such research services as NEC deems necessary for the conduct of its
functions. Your committee expects that. every Federal agency will co-
operate fully, and furnish such research skills and services consistent
with its other responsibilities.
NEC also will have the broad authority of subsection 31a. and section
32 of the Atomic Energy Act for the performance of research.
The intent and purpose of the provisions applicable to NEC re-
search are (1) to insure that the Commission has the capability to per-
form effectively its licensing and related regulatory functions with full
regard to the public health and safety; and (2) to avoid costly dupli-
cation in facilities. Your committee be] ieves that these objectives are
compatible and manas-eahle.
It is expected that the NEC wil I contract for most of its required re-
search, exercising its independent judgment as to performance and
results. Given the availability of extensive technical resources for
research in the laboratories and industrial complexes associated with
the activities to be managed and directed by ERDA, there should be
little need. for NEC to build laboratory facilities.
AUTHORIZATION OF APPROPRIATIONS
The bill does not alter the jurisdiction. of any committee of the Con-
gress. Section 304 of the bill provides for annual authorization of ap-
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propriations, except as otherwise provided by law. The provisions of
section 261 of the Atomic Energy Act of 1954, as amended, remain un-
affected by the provisions of this bill. Accordingly, authorization for
the functions transferred by the AEC and those remaining with the
Nuclear Energy Commission will continue, as heretofore, pursuant
to the provisions of section 261 of the Atomic Energy Act.
Your committee wishes to point out that an annual authorization
pursuant to section 304 of this bill can include multi-year authoriza-
tions for specified projects or activities. In the committee's judgment,
multi-year authorization would be desirable for certain types of co-
operative arrangements and other projects. Your committee also rec-
ommends that, when large-scale joint or cooperative projects are to be
undertaken, they be specifically authorized by the Congress. The an-
nual authorization will be available for this purpose. Lesser projects
can be reviewed, as appropriate, by the committee(s) of jurisdiction.
REPORTS
Subsection 306 (a) of the bill provides for an annual comprehensive
report by the Administrator to the President for submission to the
Congress. The report will include a statement of the short-range and
long-range goals, the priorities and plans of ERDA, and an assess-
ment of the progress achieved toward their attainment. Your com-
mittee also expects that, from time to time, the report will contain rec-
ommendations for statutory changes and an account of administrative
changes made within the Administrator's authority. It will be a con-
tinuing responsibility of the Administrator to appraise the organiza-
tion and operations of his agency in the interest of improving
performance.
Additionally, section 307 of the bill should assure that the Admin-
istrator will keep the appropriate congressional committees fully and
currently informed with respect to all the Administrator's activities.
The provisions of the Atomic Energy Act of 1954, as amended, rel-
ative to reports and information to the Congress, remain unaffected
by this bill. Such provisions continue to apply to the functions of the
AEC transferred to ERDA as well as to those remaining with the
Nuclear Energy Commission.
Your committee also recommends that, in the first year of opera-
tion, the Administrator develop a 10-year program to chart the course
of energy research and development. The annual authorizations and
appropriations will insure proper congressional participation. Annual
reports, up-dating the program from year to year, should indicate
the progress made in relation to the planned program, which will
constitute the nation's strategy for achieving national self-sufficiency
in energy.
The Administrator will take note, or course, of the report to the
President submitted by Dr. Dixy Lee Ray, Chairman of the Atomic
Energy Commission, on December 1, 1973. This report, entitled "The
Nation's Energy Future," was prepared at the President's request and
is pointed "toward the attainment of a capacity for energy self-suf-
ficiency by 1980." The Administrator, of course, will use his own best
judgment, illumined by the best intelligence and advice he can obtain,
to determine whether, or in what manner, the aforementioned report
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should be modified to accord with available resources, emerging oppor-
tunities, and responsibilities under the charter given by this bill.
ESTIMATED SAVINGS AND COSTS
Your committee requested the Office of Management and Budget to
submit estimates of additional costs which could be expected as a result
of this reorganization. Their response to the committee said, in part :
Estimated Savings
As a result of these program consolidations, it may be pos-
sible to effect some minor savings as a result of administrative
and overhead efficiencies.
The real savings, however, will be realized by the Ameri-
can consumer in years to come as a result of advancing the
state of energy technology to the point where our vast domes-
tic reserves of fossil fuels, the processes of nuclear fusion
and fast breeder reactors, and other advanced sources of
energy such as solar and geothermal can be exploited to pro-
duce adequate amounts of clean energy at reasonable-rather
than currently spiraling-costs. The savings to the American
consumer that could result; from the prompt establishment
of a strong energy R & D agency such as ERDA literally
amount to billions of dollars.
Estimated Costs
With regard to ERDA, the costs directly attributable to
the reorganization are expected to be only those associated
with administrative and management transitions such as
office title changes, establishment of additional net positions
authorized by H.R. 11510, new telephone books, etc. In all,
these should not, total more than $1 million.
With regard to NEC, H.R. 11510 essentially has the effect of
transferring AEC's R & D and production functions to
ERDA, leaving the regulatory functions largely unaffected
and to be carried on under a new agency name-the Nu-
clear Energy Commission. When ERDA is established, NEC
will require some additional. administrative support amount-
ing to about 150 positions. The cost of this and other admin-
istrative adjustments is expected to be approximately $3
million.
One additional cost of establishing NEC will result from
the necessity of enhancing NEC's technical expertise in the
areas of biomedical and environmental research and waste
management and transportation. It is expected that Con-
gress will be requested for up to $5--$10 million in NEC's first
budget to undertake research in these areas.
In sum, according to OMB information, reorganizations authorized
and directed by the bill may entail additional costs of approximately
$4 million, to be offset partly by minor savings in reduction of ad-
ministrative costs by consolidation. The committee also is advised
that additional yearly costs of $4 million may be required for each
of the following five fiscal years. This estimate is accepted by the
committee as its own.
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Since this is primarily a reorganization bill, and contains only gen-
eral authorization authority, it does not, by its terms, commit the
administrator or the Commission to specific expenditures for pro-
grams or activities. These will be authorized in separate legislation.
PROVISIONS OF THE ATOMIC ENERGY ACT APPLICABLE
TO FUNCTIONS TRANSFERRED FROM THE AEC AND
TO FUNCTIONS REMAINING IN NEC
The Energy Research and Development Administration and the
Nuclear Energy Commission, will utilize authorities provided by the
Atomic Energy Act of 1954, as amended. Since the bill entails a separa-
tion of functions to be administered separately by these two agencies, it
follows that certain provisions of the Atomic Energy Act will be ap-
plicable to each agency. The following analysis shows the distribu-
tion of separately and jointly applicable authorities under that Act.
1. The following provisions of the Atomic Energy Act of 1954, a
heretofore amended, apply only to EILDA
Subsection 31b. (certain grants and contributions).
Section 33 ("Research for Others").
Chapter 5 ("Production of Special Nuclear Material").
Subsections 53c; 53d; and 53f. (distributing special nuclear mate-
rial).
Section 54 ("Foreign Distribution of Special Nuclear Material").
Section 56 ("Guaranteed Purchase Prices").
Section 58 ("Review").
Subsection 63c. (charges for distributing source material).
Section 64 ("Foreign Distribution of Source Material").
Section 67 ("Operations on Lands Belonging to the United States").
Section 91 ("Authority").
Section 142 ("Classification and Declassification of Restricted
Data").
Section 143 ("Department of Defense Participation").
Subsections 144a; 144b; and 144c. (international cooperation).
Subsections 151c; 151d; 151e. (certain patent aspects).
Section 153 ("Nonmilitary Utilization").
Section 154 ("Injunctions").
Section 157 ( "Commission Patent Licenses").
Subsections 161e; 161m; 161r; 161t; 161u; and 161v. (general pro-
visions).
Section 164 ("Electric Utility Contracts").
Section 167 ("Claims Settlements").
If. The following provisions of the Atomic Energy Act of 1954, as
heretofore amended, apply only to NEC
Subsection 53b. (minimum criteria for licenses).
Subsection 53e. (licensing conditions).
Section 62 ("License for Transfers Required") .
Subsection 63b. (minimum criteria for licenses).
Section 69 ("Prohibition").
Section 101 ("License Required").
Section 102 ("Utilization and Production Facilities for Industrial
or Commercial Purposes").
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Section 103 ("Commercial Licenses").
Section 104 ("Medical Therapy and Research and Development").
Subsection 105c (licensin' antitrust review).
Section 106 ("Classes of Facilities").
Section 107 ("Operators' Licenses") .
Section 109 ("Component Parts of Facilities").
Subsection 161h. (licensing activities).
Subsection 161w. (licensingg charges) .
Section 182 ("License Applications") .
Section 183 ("Terms of License").
Section 184 ("Inalienability of Licenses").
Section 185 ("Construction Permits").
Subsections 186a. and 186b. (license revocation).
Section 187 ("Modification of License").
Section 190 ("Licensee Incident Reports").
Section 191 ("Atomic Safety and Licensing Board").
Section. 192 ("Temporary Operating License").
Section. 272 ("Applicability of Federal Power Act").
Section. 273 ("Licensing o f Government Agencies").
Section 274 ("Cooperation with States").
III. The following provisions of the Atomic Energy Act of 1954, as
heretofore amended, generally apply, respectively, to the func-
tione of the Administrator and to NEC
Chapter 1 ("Declaration, Findings and Purpose").
Chapter 2 ("Definitions"); provided that (i) the determinations
and criteria in j. (extraordinary nuclear occurrences) shall be the re-
sponsibility of the Administrator only in regard to activities and mat-
ters not covered by the licensing and related regulatory facets of Sec-
tion 170 of the Atomic Energy Act, as amended, and (ii) the determi-
nations in v. (production facility), z. (source material), aa. (special
nuclear material), and cc. (utilization facility), shall be the responsi-
bility of the Administrator only in regard to facilities and materials
not subject to licensing and related regulatory control by NEC.
Chapter 3 ("Organization"); except (i) as provided for in this
bill, (ii) the Inspection Division established by subsection 25c. will
remain in NEC, and the ERDA Administrator also will provide for
the discharge of the inspection function under subsection 25c. in
ERDA, (iii) in regard to section 29 ("Advisory Committee on Re-
actor Saf(guards"), it is intended that the ACRS remain with NEC
but that the ACRS also be made available to ERDA as the Admini-
strator may request to perform such of the activities contemplated
by section 29 as relate to functions transferred to the Administrator.
Subsections 31a; 31c; and 31d. (research assistance), and Section
32 ("Research By the Commission").
Section 51; provided, that the respective determinations shall be
made as indicated in. Chapter ,2 above.
Subsection 53a; provided, that subdivisions (ii) and (iii) of said
subsection (distributing and making available special nuclear mate-
rial) shall apply only to ERDA, and subsection (i) (licenses) shall
apply only to NEC.
Section 55 ("Acquisition").
Section 57 ("Prohibition").
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Section 61 ("Source Material") ; provided, that the respective de-
terminations shall be made as indicated in Chapter 2 above) .
Subsection 63a. (source material) ; provided, that the authority to
distribute shall apply only to ERDA and the authority to license shall
apply only to NEC.
Section 65 ("Reporting").
Section 66 ("Acquisition").
Section 68 ("Public and Acquired Lands").
Section 81. ("Domestic Distribution"), and Section 82 ("Foreign
Distribution of Byproduct Material") ; provided, that the authority to
distribute shall apply only to ERDA and the authority to license shall
apply only to NEC.
Section 92 ("Prohibition").
Subsections 105a. and 105b. (Antitrust provisions and reporting).
Section 108 ("War or National Emergency").
Section 110 ("Exclusions") ; it should be noted that subsection 110a.
is amended by section 202 of the bill.
Chapter 11 ("International Activities") ; provided, that, except for
licensing and regulatory aspects, the implementation of these provi-
sions shall be the responsibility of ERDA.
Section 141 ("Policy") ; provided, that the implementation of sub-
section 141a. shall be the responsibility of ERDA.
Subsection 144d. (Presidential authorization).
Section 145 ("Restrictions") ; except that only the Administrator
shall establish the basic standards and procedures for the safeguarding
of the national defense and security.
Section 146 ("General Provisions").
Subsections 151a and 151b. (certain inventions and discoveries).
Section 1.52 ("Inventions Made or Conceived During Commission
Contracts").
Section 155 ("Prior Art").
Section 156 ("Commission Patent Licenses").
Section 158 ("Monopolistic Use of Patents").
Section 159 ("Federally Financed Research").
Section 160 ("Saving Clause").
Subsections 161a., 161b., 161c., 161d., 161f., and 161g. (general au-
thority).
Subsection 161i. and 1611. (certain regulations or orders and dis-
positions) ; provided, that the Administrator shall establish the basic
standards and procedures respecting the national security.
Subsections 161k. (firearms), 161n. (delegations), 161o. (reports and
records), 161p. (rules and regulations), 161q. (rights-of-way), and
161s. (succession of authority).
Section 162 ("Contracts").
Section 163 ("Advisory Committees").
Section 165 ("Contract Practices").
Section 166 ("Comptroller General Audit") ; it should be noted
that section 305 of the bill also makes this section applicable to ERDA's
contracts for non nuclear activities.
Section 168 ("Payments in Lieu of Taxes").
Section 169 ("No Subsidy").
Section 170 ("Indemnification and Limitation of Liability").
Chapter 15 ("Compensation for Private Property Acquired").
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Section 181 ("General").
Subsection 186e. (Retaking and Recapture) ; provided that the
Administrator shall establish the basic standards and procedures in
regard to safeguarding the national defense and security.
Section 188 ("Continued Operation of Facilities") ; provided, that
findings and judgments respecting the production program shall be
the responsibility of the Administrator.
Section 189 ("Hearings and Judicial Review").
Chapter 17 ("Joint Committee on Atomic Energy") .
Chapter 18 ("Enforcement") ; except for Section 234 ("Civil Mone-
tary Penalties for Violation of Licensing Requirements") which is
applicable only to NEC.
Section :341 ("Transfer of Property").
Section 2,51 ("Report to the Congress").
Section 261 ("Appropriations").
Section 271 ("Agency Jurisdiction").
Section 281 ("Separability") and Section 291 ("Short Title").
SECTION-BY-SECTION ANALYSIS
Section I states that this Act may be cited as the "Energy Reorga-
nization Act of 1973."
Section 2 is concerned with declarations and findings.
Subsection 2(a) sets forth a congressional declaration that the gen-
eral. welfare and the common defense and security require effective
action to develop all energy sources and increase the efficiency and
reliability of energy use. The purposes to be served are (1) meeting
the needs of future. generations, (2) increasing the productivity of the
national economy and its international trade position, (3) making
the nation. self-sufficient in energy, (4) restoring, protecting, and en-
hancing environmental quality, and (5) assuring public health and
safety.
Subsection (b) states a congressional finding that, to best achieve
the objectives of this Act, it is necessary to establish an Energy Re-
search and Development Administration to bring together and direct
Federal activities relating to research and development on the various
sources of energy, to increase the efficiency and reliability of use of
energy, and to carry out the performance of other functions, includ-
ing the Atomic Energy Commission's military and production activi-
ties.
Subsection (c) sets forth a congressional declaration and finding
that it is in the public interest that the licensing and related regulatory
functions of the Atomic Energy Commission be separated from the
performance of other functions of the Commission, which are trans-
ferred by this Act to the Energy Research and Development Admin-
istration. The Congress finds it is in the public interest that this
separation of functions be effected in an orderly manner assuring
adequacy of resources for their performance by each segment.
TITLE I
ENERGY RESEARCH AND DEVELo PMENT ADMINISTRATION
Section 101 establishes the Energy Research and Development
Administration as an independent executive agency.
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Section 102 prescribes the top officer positions.
Subsection 102 (a) provides that the Administration will be headed
by an Administrator appointed by the President by and with the
advice and consent of the Senate, to be compensated at the level II
rate of the Executive Schedule. He will be responsible for the efficient
and coordinated management of the Administration.
Subsection 102(b) provides for a Deputy Administrator to be ap-
pointed by the President with Senate confirmation, and to be com-
pensated at level III of the Executive Schedule.
Subsection 102(c) provides for appointment by the President, with
Senate confirmation of five Assistant Administrators responsible,
respectively, for (1) fossil energy, (2) nuclear energy, (3) environ-
ment, safety and conservation, (4) research and advanced energy sys-
tems, and (5) national security. These appointees will be compensated
at level IV of the Executive Schedule.
Subsection 102(d) provides for the appointment of a General
Counsel by the Administrator. The General Counsel will serve at the
pleasure of the Administrator and be compensated at level V of the
Executive Schedule.
Subsection 102 (e) authorizes the Administrator to appoint not more
than seven additional officers who will be compensated at level V of
the Executive Schedule. These will bcareer positions and be subject
to subsection 161 d. of the Atomic Energy Act, which authorizes ap-
pointment of officers and employees.
Subsection 102(f) provides for appointment by the Administrator
of a Director of Military Application to head the Division of Military
Application transferred to the Administration by subsection 104 (b) of
this Act. The Director of Military Application will be an active mem-
ber of the Armed Forces serving in general or flag officer rank or grade,
as appropriate, with the same functions, qualifications, and compen-
sation as are now provided in the Atomic Energy Act for the Assistant
General Manager of AEC for Military Application. The Director of
Military Application will serve at the pleasure of the Administrator.
Subsection 102(g) provides that officers appointed pursuant to this
section will perform such functions as the Administrator specifies from
time to time.
Subsection 102 (h) provides that the Deputy Administrator shall
act for the Administrator in the event of a vacancy in the office of the
Administrator or in the event of the absence or disability of the
Administrator, and states that the Administrator shall establish the
further order of succession.
Section 103 prescribes eight categories included in the Adminis-
trator's responsibilities, as follows :
(1) exercising central responsibility for policy planning, co-
ordination, support, and management of research and develop-
ment programs respecting all energy sources, including assessing
the requirements for research and development in regard to
various energy sources in relation to near-term and long-range
needs, policy planning in regard to meeting those requirements,
undertaking programs for the optimal development of the various
forms of energy sources, managing such programs, and dissemi-
nating resulting therefrom ;
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(2) encouraging and conducting research and development to
demonstrate the commercial .feasibility and practical applica-
tions of energy sources and utilization technologies;
(3) undertaking research and development in the extraction,
conversion, storage, transmission, and utilization phases related
to the development and use of energy from fossil, nuclear, solar,
geothermal and other energy sources;
(4) engaging in and supporting environmental, biomedical,
physical, and safety research related to the development of energy
sources and utilization technologies ;
(5) taking into account the existence, progress and results of
other public and private research and development activities
relevant to the Administrator's mission in formulating his re-
search and development programs;
(0) participating in and supporting cooperative research and
development projects which may involve contributions by public
or private persons or agencies of financial or other resources to
the performance of the work;
(7) developing, collecting, distributing, and making available
for distribution, scientific and technical information concerning
the manufacture or development of energy and its efficient extrac-
tion, conversion. transmission and utilization; and
(8) encouraging and conducting research and development for
the conservation of energy.
Section 104 specifies the functions and units transferred to the
Administrator and the Administration from other departments or
agencies.
Subsection 104(a} transfers all functions of the Atomic Energy
Commission, the Chairman and members of the Commission, and the
Commission's officers and components, except as otherwise provided
in this Act.
Subsection 104 (b) preserves and includes in the transfer the General
,advisory Committee, the Patent Compensation Board, and the Divi-
sions of Military Application and Naval Reactors; and it preserves
the relationship with the Military Liaison Committee.
Illustrative of the functions transferred by subsections 104 (a) and
(b) from AEC are research and development relating to nuclear and
Other energy sources, energy u.tilizat on and related environmental
and safety aspects; military applications of atomic energy such as
development and production of nuclear weapons ; production of nu-
clear materials ; research in the physical and biomedical sciences ;
international cooperation for the utilization and safeguarding of nu-
clear materials; dissemination of scientific and technical information;
and administration of a program for indemnification of contractor
liability for damages from nuclear incidents.
In effect, section 104, in conjunction with section 201, separates the
licensing and related regulatory functions of the Atomic Energy Com-
rnission from the development, production, research, and other remain-
ing functions of the Commission, and transfer all the functions not
part of licensing and related regulation to the Administrator. Perti-
nent provisions of the Atomic Energy Act of 1954, as heretofore
amended and as modified in several technical or perfecting respects
by the provisions of this Act, will continue to be applicable, respec-
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tively, to such transferred functions and to the licensing and related
regulatory functions remaining in the Nuclear Energy Commission.
Subsection 104 (c) transfers certain functions of the Secretary of the
Interior, the Department of the Interior and offices and components
thereof as follows :
Paragraph (1) transfers the functions relating to the Office of Coal
Research (OCR), which was established pursuant to the Act of July
1, 1960 (30 U.S.C. 661-668). Through contracts with outside orga-
nizations, OCR sponsors research and development involving princi-
pally the conversion of coal to other agency forms, such as liquid
hydrocarbons, clean fuel gas, substitute pipeline gas, and direct electric
power.
Paragraph (2) transfer certain functions conducted by the Bureau
of Mines (established as set out in 30 U.S.C. 1-7) that are directed
toward fossil fuel energy research and development. The six research
centers included in this transfer are located in Bartlesville, Oklahoma;
Grand Forks, North Dakota; Laramie, Wyoming; Morgantown, West
Virginia; Pittsburgh, Pennsylvania; and San Francisco, California.
A synthane pilot plant, for coal gasification, now under construction,
is included with the transferred facilities. The energy research pro-
grams of the Bureau of Mines include the conversion of coal into gas,
nonpolluting oil and metallurgical coke; the magnetohydrodynamic
generation of power; the in situ production of oil from oil shale; and
the improved recovery of oil and natural gas.
Paragraph (3) transfers the existing program of underground elec-
tric power transmission research under the direction of the Secretary
of the Interior.
Subsection 104(d) transfers from the National Science Foundation
(NSF) functions relating to development of solar heating and cooling
of buildings and of geothermal power. The NSF, under its general
statutory authorization (42 U.S.C. 1682), has been supporting basic
and applied research through proof of concept experimentation in
these areas in preparation for prototype development and demonstra-
tion of functioning systems. The Administrator will assume respon-
sibility under this subsection for programs in these development and
demonstration areas. Subsection (c) is not intended to modify the
existing authority of the NSF in basic and applied research.
Subsection 104(e) transfers functions of the Environmental Pro-
tection Agency (EPA) and the officers and components thereof which
relate to or are utilized in connection with the development and dem-
onstration of alternative automotive power systems and the develop-
ment and demonstration of precombustion, combustion and postcom-
bustion technologies to control emissions of pollutants, such as sulfur
oxides, oxides of nitrogen and particulates, from stationary sources
using fossil fuels. EPA's authority in this area is derived mainly
from the Clean Air Act (42 U.S.C. 1857-18571). EPA will retain its
Michigan test facility for automotive emissions and the technology.
assessment staff and consultants needed in setting standards and moni.
toring technological developments.
Subsection 104(f) is a technical provision designed to permit the
Administrator, to the extent necessary or appropriate to perform trans-
ferred functions, to exercise authority available by law, including ap-
propriation acts, to the official or agency from which the functions
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were transferred. This does not divest the transferring agency of the
authority with respect to the functions retained by that agency.
Subsection 105(a) provides that personnel, personnel positions, as-
sets, liabilities, contracts, property, records, and unexpended balances
of appropriations, authorizations, allocations, and other funds relating
to functions transferred by this Act follow and are transferred with
those functions. Appropriations transferred will be accounted for in
accordance with section 202 of the Budget and Accounting Procedures
Act of 1950 (31 U.S.C. 581c), which normally governs transfers of this
type. Personnel positions expressly created by law, personnel occupy-
ing those positions on the effective data of this Act, and personnel au-
thorized to receive compensation at one of the rates prescribed for level
II, III, IV, or V of the Executive Schedule (5 U.S.C. 5313-5316)
will be subject to the provisions of subsection 105(c) and section 301.
Subsection 105(b) provides that nontemporary personnel, other
than personnel entitled to compensation under the Executive Schedule,
shall not be separated or reduced in grade or compensation, as a result
of the enactment of this Act, for one year after being transferred to
the Administration created pursuant to this Act. This provision is de-
signed to preclude reduction in force solely as a result of this Act for
one year after the transfer. However, this provision would not pre-
clude ,separation or reduction for cause or any other circumstance ap-
plicable if this Act had not been enacted.
Subsection 105 (c) provides that a person entitled to compensation
under the Executive Schedule may be employed by the new Adminis-
tration and that, if the employment is without break in service and
if the duties of the new position are comparable to the duties per-
formed immediately preceding the new appointment, such person
will be entitled to receive compensation at a rate not less than he re-
ceived in his previous position.
Section 106 contains administrative provisions.
Subsection 106 (a) authorizes the Administrator to prescribe appro-
priate policies, standards, criteria, procedures, rules and regulations.
Subsection 106(b) provides that the Administrator shall engage in
policy planning and perform program analyses and other studies to
promote the efficient and coordinated administration of his agency and
to assess its progress.
Subsection 106(c) authorizes the Administrator to delegate, and
authorize redelegations of, any of his functions.
Subsection. 106(d) authorizes the Administrator to organize the Ad-
ministration as he deems appropriate, except for the organizational
elements specified in section 102 and subsection 104(b).
Subsection. 106(e) authorizes the Administrator to establish and
discontinue field offices.
Subsection. 106(f) authorizes the Administrator to prescribe a seal
for the Administration.
Subsection. 106 (g) authorizes the establishment of a working capital
fund by the Administrator to defray necessary expenses arising out of
the mainten rote and operation of common administrative services.
Subsection 106 (h) authorizes executive agencies to furnish the
Administrator information or other data.
Section 107 deals with personnel.
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Subsection 107(a) authorizes the Administrator to employ officers
and employees and fix their compensation pursuant to subsection
161 d. of the Atomic Energy Act (42 U.S.C. 2201(d)).
Subsection 107(b) authorizes the Administrator to obtain the serv-
ices of experts and consultants.
Subsection 107(c) authorizes the Administrator to arrange by
agreement with the Secretaries of the Military Departments for par-
ticipation of military personnel in the performance of his functions,
excluding appointments subject to Senate confirmation.
Subsection 107(d) provides that the status and benefits of military
persons shall not be adversely affected by service under subsection (c).
Subsection 107 (e) authorizes payment of transportation expenses
and per diem to temporary or seasonal employees. Such payments will
be made in accordance with chapter 57 of title 5 of the United States
Code which governs similar payments to other Government employees
for official travel.
Subsection 107(f) authorizes the Administrator to utilize, on a
reimbursable basis, the services of personnel made available by any
Executive agency.
Subsection 107(g) authorizes the Administrator to establish
advisory boards in. accordance with the provisions of the Federal
Advisory Committee Act (5 U.S.C. App. I, 1970 ed., Supp. II).
Subsection 107(h) authorizes the Administrator to employ non-
citizens in technical or professional capacities.
Section 108 sets forth the basic statutory powers of the Adminis-
trator.
Subsection 108 (a) authorizes the Administrator to insure continued
research and development in the interest of expanding scientific, tech-
nical and practical knowledge in energy matters, to make arrangements
(including contracts, agreements, and loans) for the conduct of re-
search and development activities with private or public institutions
or persons, including joint projects of a research, developmental or
experimental nature. The Administrator is authorized to make pay-
ments (in lump sum or installments, and in advance or by way of
reimbursement, with necessary adjustments on account of overpay-
ments or underpayments) and generally to take such steps as he deems
necessary or appropriate to perform his functions. Functions appli-
cable to the nuclear activities transferred by title I of this Act will
be subject to the provisions of the Atomic Energy Act of 1954, and
to other authority applicable to such activities. The nonnuclear respon-
sibilities and functions transferred by this Act will be carried out
pursuant to the provisions of this Act, the authorities applicable to
those functions immediately before the effective date of this Act, or in
accordance with chapter 4 of the Atomic Energy Act (42 U.S.C. 2051-
2053).
Subsection 108 (b) authorizes the Administrator to acquire facilities
required for the maintenance and operation of laboratories, research,
and testing sites and facilities, quarters, and related accommodations
for employees and their dependents, and such other special purpose
real property as the Administrator may deem necessary. Special pur-
pose facilities and real property may be acquired by purchase, lease,
condemnation, or otherwise. General purpose facilities and real prop-
erty needs will continue to be met through the authority of the General
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34:
Services A.dministrat.ion. The Federal Government will take title to
all property acquired pursuant to this section.
Subsection 108(c) authorizes the Administrator to provide, con-
struct, or maintain, as necessary and. when otherwise unavailable, cer-
tain facilities and services for employees and their dependents at
remote locations. Included are emergency medical services and sup-
plies; food and subsistence supplies ? messing facilities; audio-visual
equipment, accessories, and supplies for recreation and training; reim-
bursement to such employees for furnishing food, medicine and other
supplies for temporary relief of distressed persons; living and working
quarters and facilities; and transportation for school-age dependents
to the nearest appropriate educational facilities. Reimbursement at
reasonable prices will be required for medical treatment and services
and supplies furnished to employees and their dependents.
Subsection 108 (d) authorizes the Administrator to acquire copy-
rights and patents, design processes, specifications and data.
Subsection 108(a) requires the Administrator, subject to 42 U.S.C.
2161-2166 and other applicable law, to disseminate scientific, technical
and practical energy information acquired pursuant to this Act. Other
applicable law would. include the Freedom of Information Act. He is
required also to encourage the dissemination of such information by
others so as to provide for the free exchange of ideas and criticism.
Subsection 108(f) authorizes the Administrator to accept, hold,
administer, and utilize gifts and bequests.
NUCLEAR ENERGY COMMISSION
Section 201 provides that the Atomic Energy Commission (AEC)
shall be renamed the Nuclear Energy Commission (NEC). The Com-
mission will continue to perform the licensing and related regulatory
functions which the AEC. its Chairman, members, officers and com-
ponents performed prior to the effective date of this Act. These func-
tions, officer, components and personnel are excepted from the trans-
fer of AEC functions provided in section 104 of this Act. The Atomic
Safety and Licensing Board and Atomic Safety and Licensing Appeal
Board panels (42 U.S.C. 2241), the Advisory Committee on Reactor
Safeguards (42 U.S.C. 2039), and the Inspection Division, will re-
main with the Commission. Section 104, read in conjunction with this
section, places in separate agencies the regulatory and nonregulatory
functions now exercised by the AEC.
The Advisory Committee on Reactor Safeguards will conduct safety
reviews of ERDA nuclear activities and facilities as requested by the
Administrator.
Section 202 gives the Nuclear Energy Commission authority to
license selected Administration facilities pursuant to chapters 6, 7, 8,
and 10 of the Atomic Energy Act. Thus, it is empowered to license
(1) demonstration liquid metal fast breeder reactors when used as
part of the power generation facilities of an electric utility system,
(2) other demonstration nuclear reactors when operated as a part of
an electric utility system, except those in existence, under construction,
or authorized or appropriated for by the Congress on the date this
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Act becomes effective, or (3) facilities used primarily for the receipt
and storage of high level radioactive wastes resulting from activities
licensed under the Atomic Energy Act, except those in existence, under
construction, or authorized or appropriated for by the Congress on the
date this Act becomes effective.
Section 203 prescribes- the Commission's research authority and
relationships with the Administration and other Federal agencies.
Subsection 203 (a) specifically confirms the authority of NEC to
engage in or contract for research which NEC deems necessary for the
discharge of its licensing and regulatory functions. Functions of orig-
inating or developing new designs and technologies are transferred
to the Administration by subsection 104 (a) of this Act.
Subsection 203 (b) authorizes the Administration and other Federal
agencies to conduct such research for NEC as the Commission may
request in connection with the performance of its functions and to
cooperate in the establishment of priorities for furnishing such
research services.
. TRANSITIONAL. PROVISIONS
Section 301 contains customary transitional provisions.
Subsection 301 (a) provides that, except as otherwise provided in
the Act, whenever all of the functions of an agency, or other body,
or of any component thereof, have been transferred by title I of this
Act, the agency or other body or component shall lapse. This, in effect,
discontinues organizational structures when they no longer have func-
tions to perform. It applies only when all of the functions of the agency
or component have been transferred to the Administrator. The sub-
section also provides that all Executive Schedule officers and statutory
positions in an agency or component that lapses under the first sentence
of the section also shall lapse.
Subsection 301 (b) is a savings clause that continues the effective-
ness of all existing orders, determinations, rules, regulations, permits,
contracts, certificates, licenses, and privileges affected by this Act, until
such time as they are otherwise modified or replaced by appropriate
authority or otherwise expire. This avoids any inadvertent lapsing
or impairment of essential Executive orders, directives, documents,
and obligations, and will afford the President, the Administrator, or
other officials sufficient time to deal with these matters in an orderly
fashion.
Subsection 301 (c) is another savings clause that preserves and con-
tinues administrative proceedings in being on the effective date of the
Net. These proceedings will, in effect, be continued,. modified, or termi-
nated as if the Act had never been enacted.
Subsection 301(d) is a savings clause that permits suits commenced
prior to the date of this Act to be continued and conducted as if this
Act had not been enacted.
Subsection 301 (e) protects suits, actions or other proceedings from
abatement by reason of enactment of this Act. In any litigation pend-
ing when these actions take effect, the court may enter an appropriate
order which will give effect to these savings provisions.
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Subsection 301(f) provides for proper substitution of parties in
connection with the continuation of litigation pending on the date
this Act becomes effective.
Subsection 301(g) makes finial orders and actions of any transferred
official or component subject to judicial review as if this Act had not
been enacted.
Subsection 301(h) provides that with respect to functions trans-
ferred by the Act, references in laws to other officials shall be deemed
to be a reference to the Administrator, or other officials, as appropriate.
Subsection 301 (i) provides, that any existing authority of the Presi-
dent is not affected by this Act.
Subsection 301(j) provides that reference in this Act of provisions
of law shall be deemed to include, as appropriate, reference thereto
as amended or supplemented before or after the effective date of this
Act. This avoids repetitious use of the phrases "as amended" or "as
supplemented."
Subsection 301(k) makes clear that except as otherwise expressly
provided in this Act, authority provided by this Act is in addition
to, and not in substitution for, any existing authority transferred by
this Act.
Section 302 authorizes the Director of the Office of Management
and Budget to make such additional incidental dispositions of per-
sonnel, personnel positions, assets, liabilities, contracts, property,
records, appropriations, etc., as may be necessary to carry out the
intent and purpose of this Act.
Section 303, to avoid repetitious references, defines "function,"
"function,;," "perform" and "performance" to include such terms as
duties, obligations, powers, authorities, responsibilities, rights, privi-
leges, and activities, and the exercise thereof.
Section 304 provides that except as otherwise provided by law,
appropriations made under this Act shall be subject to annual
authorization.
Section 305 applies to nuclear and nonnuclear activities the present
provisions of section 166 of the Atomic Energy Act for audit and
access to records by the Comptroller General with respect to contracts.
Section 306 contains reporting provisions.
Subsection 306 (a) requires the Administrator to transmit to the
President for submission to the Congress an annual report on his
agency's activities. The report is to include a statement of the short-
range and long-range goals, priorities, and plans of the Administrator,
together with an assessment of the progress made toward attainment
of these objectives and toward the more effective and efficient manage-
ment of the Administration and coordination of its functions.
Subsection 306(b) requires the Administrator, in collaboration
with the Secretary of Defense, to conduct a thorough review of the
desirability and feasibility of transferring to the Department of De-
fense or other Federal agencies the functions of the Administrator
respecting Military application and restricted data. This review is to
be made, and a report sent to the President for submission to the Con-
gress, within one year after the Administrator takes office. The report
will set forth the Administrator's comprehensive analysis, the prin-
cipal alternatives, and the specific recommendations of the Adminis-
trator and the Secretary of Defense.
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Section 307 provides that the Administrator shall keep the appro-
priate congressional committees fully and currently informed with
respect to all of the Administration's activities.
Section 308 permits the Administrator, when authorized in an ap-
propriation act, to make transfers of funds from one appropriation
to another within his agency, but no appropriation shall be either
increased or decreased by more than 5 percent.
Section 309 is a technical, conforming amendment covering the
Executive Schedule compensation pertaining to this Act.
Section 310 is a standard separability provision that avoids the
invalidation of the remaining provisions of this Act in the event that
a single provision is found to be invalid.
Section 311 provides for an effective date and interim appointments.
Subsection 311 (a) provides that this Act shall become effective
120 days after the Administrator is appointed, or on such earlier date
as the President may prescribe and publish in the Federal Register.
This will give the President time to select, nominate, and appoint the
Administrator, and will give the Administrator sufficient time to ar-
range and organize the new Administration and prepare such rules,
regulations, orders, etc., as may be necessary for a smooth transition.
Prior to the effective date, the regulatory arm of the present Atomic
Energy Commission will be provided with sufficient resources to en-
able it to perform its functions within the framework of a wholly
separate organization.
Subsection 311 (b) provides that, if an offices subject to Senate con-
firmation under this Act has not entered upon his office on the effective
date of the Act, the President may designate any officer who was ap-
pointed by and with the advice and consent of the Senate and who was
such an officer immediately prior to the effective date of the Act, to
act in such office temporarily. An officer thus designated would draw
pay at the rate provided in this Act for the position filled by him
under this subsection.
TITLE IV
BAR AGAINST SEx DISCRIMINATION
Section 401 bars sex discrimination in connection with any license,
activity, or Federal assistance under this Act.
CHANGES IN EXISTING LAW MADE BY THE BILL,
AS REPORTED
In compliance with clause 3 of rule XIII of the Rules of the House
of Representatives, changes in existing law made by the bill, as re-
ported, are shown as follows (existing law proposed to be omitted is
enclosed in black brackets, new matter is printed in italic, existing law
in which no change is proposed is shown in roman) :
TITLE 5, UNITED STATES CODE
* * * * * * *
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SUBCHAPTER II-EXECUTIVE SCHEDULE PAY RATES
? 5313. Positions at level II
Level II of the Executive Schedule applies to the following posi-
tions, for which the annual rate of basic pay is $42,500:
(1) * * *
* * * * * *
(8) Chairman, [Atomic] N !clear Energy Commission.
(22) Administrator of Energy Research and Development.
? 5314. Positions at level III
Level III of the Executive Schedule applies to the following posi-
tions, for which the annual rate of basic pay is $40,000:
(1) ***
* * * * * * *
(42) Members, [Atomic] Nuclear Energy Commission.
(60) Deputy Administrator, Energy Research and Development
Administration.
? 5315. Positions at level IV
Level IV of the Executive Schedule applies to the following posi-
tions, for which the annual rate of basic pay is $38,000:
***
(1)
[(50) General Manager
* *
of the Atomic Energy Commission.]
* * * * * * *
(99)'A88istant Administrators, Energy Research and Develop-
ment Administration (5).
? 5316. Positions at level V
Level V of the Executive Schedule applies to the following posi-
tions, for which the annual rate of basic pay is $36,000:
(1)***
[(2A) Assistant General Manager, Atomic Energy Commis-
sion.]
(62) Executive Director of [Regulation, Atomic] Operations,
Nuclear Energy Commission.
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[ (69) Deputy General Manager, Atomic Energy Commission.]
(81) General Counsel of the [Atomic] Nuclear Energy Com-
mission.
[(102) Assistant General Managers, Atomic Energy Commis-
sion (2).]
(133) General Counsel, Energy Re8earch and Development
Administration.
(134) Additional ofcers, Energy Re8earclt and Development
Administration (7).
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APPENDIXES
APPENDIX 1.-SPONSORS OF H.R. 11510 AND IDENTICAL
OR SIMILAR LEGISLATION
H.R. 11510.-Mr. Holifield, Mr. Horton, Mr. Price (Illinois), and
Mr. Hosmer.
H.R. 11646.-Mr. Minshall.
H.R. 11683.-Mr. Wydler.
H.R. 11731.-Mr. Brooks, Mr. Fountain, Mr. Jones (Alabama),
Mr. Moss, Mr. Fascell, Mr. Macdonald, Mr. Moorhead (Pennsyl-
vania), Mr. Randall, Mr. Wright, Mr. St Germain, Mr. Culver, Mr.
Fuqua, Mr. Donohue, Mr. James V. Stanton, Mr. Ryan, Mr. Erlenborn,
Mr. Wydler, Mr. Brown (Ohio), Mr. Vander Jagt, Mr. Gude, and
Mr. McCloskey.
H.R. 11732.-Mr. Young (Texas), Mr. Anderson (Illinois), Mr.
Hansen (Idaho), Mr. Lujan, Mr. Johnson (California), Mr. Corman,
Mr. Hawkins, Mr. Leggett, Mr. Roybal, Mr. Brown (California), Mr.
Anderson (California), Mr. Danielson, Mr. Don H. Clausen, Mr.
Camp, Mr. Coughlin, Mr. Sebelius, Mr. Ketchum, Mr. Martin (North
Carolina), Mr. Towell, and Mr. Young (Alaska).
H.R. 11733.-Mr. Buchanan, Mr. Thone, Mr. Mallary, Mr. Parris,
Mr. Regula, Mr. Hinshaw, Mr. Steelman, Mr. Pritchard, and Mr.
Hanrahan.
H.R. 11783.-Ms. Abzug.
[NOTE.-This list shows 57 cosponsors. The names of Mr. Holifleld, Mr. Horton.
Mr. Price (Illinois), and Mr. Hosmer also appear on H.R. 11731, H.R. 11732, and
H.R. 11733, but are not repeated on this list for clarity.]
(41)
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APPENDIX 2.-EXPLANATION OF PERSONNEL
PROVISIONS OF H.R. 11510
The previsions of H.R. 11510 pertaining to personnel administra-
tion in ERDA and NEC provide for the continuation of the excepted
personnel system authorized by section 161d. of the Atomic Energy
Act, as amended. In this regard, section 107(a) of the bill authorizes
the Administrator "to select, appoint, employ, and fix the compensa-
tion of such officers and employees, including attorneys, pursuant to
section 161d. of the Atomic Energy Act 0f 1954, as amended (42
U.S.C. 2201(d)) as are necessary to perform the functions now or
hereafter vested in him and to prescribe their functions."
The continuation of the excepted personnel system of the Atomic
Energy Act, of course, will have no new impact on those employees
who will transfer from AEC to ERDA or who will continue their
employment in NEC. Employees of the Department of Interior, NSF
and EPA who would be transferred to ERDA would, at the same time,
be transferred from the competitive civil service system to the excepted
personnel system of ERDA under the authority of section 107(a)
of H.R. 11510. Although there are significant systems differences be-
tween the competitive civil service system and the personnel system
authorized by section 161d, of the Atomic Energy Act, both systems
impact on individual employees in terms of rights, protections, and
benefits in much the same way, as amplified below.
Individual employees transferred to the excepted personnel program
for ERDA or NEC, therefore, would not relinquish any of their
basic rights of benefits as Federal employees. There would be available
to them. in ERDA and NEC, however, the added benefits provided by
the AEC's merit employment system. In addition, section 105(b) of
H.R. 11510 provides that "transfer of nontemporary personnel pur-
suant to this Act shall not cause .any such employee to be separated or
reduced ir grade or compensation for one year after such transfer."
Section 105(c) provides a somewhat similar protection for those offi-
cers paid in accordance with the Executive Salary Schedule : "Any
person who, on the effective date of this Act, held a position com-
pensated in accordance with. the Executive Schedule prescribed in
chapter 53 of title 5 of the United States Code, and who, without a
break in service, is appointed in the Administration to a position hav-
ing duties comparable to those performed immediately preceding his
appointment shall continue to be compensated in his new position at
not less than the rate provided for this previous position."
EMPLOYMENT UNDER THE EXCEPTED PERSONNEL SYSTEM OF SECTION
161d. OF .THr: ATOMIC ENERGY ACT
Employee Pay.-There would be no.change in the pay received by
Federal employees transferred to ERDA or NEC. ERDA and NEC
would continue to apply a salary schedule under the authority of see-
(42)
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tion 161d. of the Atomic Energy Act which is equivalent to that pro-
vided by law for the competitive service. Within-grade increases would
be earned at the same rates as in the competitive service. Future pay
increases authorized under the Classification Act for Federal employees
would apply to ERDA and NEC employees. With respect to wage
board employees, their rates of pay would continue to be based on local
prevailing rates as provided by the applicable local wage board pay
schedule. Moreover, section 105 (b) of H.R. 11510 specifically states
that the "transfer of non-temporary personnel pursuant to this Act
[from Interior, NSF, and EPA to ERDA] shall not cause any such
employee to be separated or reduced in grade or compensation for one
year after such transfer".
Employee Status.-The interchange agreement between the Civil
Service Commission and the AEC would be applicable. Federal em-
ployees having "Career" appointments in the competitive service would
receive "Regular (Excepted)" appointments based on their having
three years of service for "career" tenure. Federal employees with
"Career-Conditional" appointments (those with less than three years
of service) would receive "Regular (Excepted) (Conditional)" ap-
pointments. In accordance with the interchange agreement, employees
of ERDA and NEC would be eligible to transfer to any agencies in
the competitive service without regard to the competitive examination
procedures administered by the Civil Service Commission.
Retention/Reduction-in-Force Rights.-Employees transferred to
ERDA and NEC would come under reduction-in-force procedures
which differ from those of the competitive service only in that they do
not provide for "retreat" rights, and do not include performance rat-
ings in determining retention rights. In the "AEC" system, a reduction
in force (RIF) is confined to a "competitive level", i.e., the grade level,
occupation, and location in which a reduction is required. Within the
competitive level, the employee with the lowest retention rights, i.e.,
least Federal service, status, and veteran-nonveteran status, is the
employee who is reduced in force.
Since "retreat" rights (movement of an employee back through
positions and grade levels previously held in lieu of separation) are not
a part of the AEC system, there is relatively less job protection for
certain employees who might be involved in a RIF. However, other
employees, e.g., those in the same competitive area but at different
grade levels (different competitive levels), could actually have better
employment protection than would be available to them under the
competitive civil service system. The AEC reduction-in-force proce-
dures, which have been approved by the Civil Service Commission
as meeting the requirements of the Veterans Preference Act, are
designed to confine the program disruption and employee morale prob-
lems to the single "competitive level" in which a reduction is to take
place. The AEC procedures avoid the problems of employees at higher
grades "retreating" to lower grades with attendant lowered morale of
those employees and those they displace who in turn "retreat" and
displace others.
Employee "Fringe" Benefits.-There would be no significant
changes in "fringe" benefits coverages available to Federal employees
transferring to ERDA or NEC. The types of leave programs, life and
health insurance programs, and retirement benefits would be the same
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in ERDA and NEC as in the rest of the Federal service. Since ERDA
would be covered by the retirement system administered by the Civil
Service Commission, employees transferring to ERDA from other
Federal agencies would be entitled to all the same civil service retire-
ment benefits.
Suamnnary.-A review of the rights, protections and benefits that
would be available to employees of ERDA and NEC reveals that there
would be no significant difference from the rights, protections and
benefits available to all Federal I_ employees. Except for the differences
in the reduction-in- force procedures cited above, which involve ad-
vantages to employees as well as disadvantages, employees transfer-
ring from other Federal agencies to ERDA or NEC would be unable
to discern any real changes in their rights, protections and benefits.
However, the excepted personnel system provided by Section 161d.
of the Atomic Energy Act would provide significant systems advan-
tages which would benefit employees as well as benefit ERDA and
NEC organS.zations.
COMPARISON OF THE EXCEPTED PERSONNEL SYSTEM OF SECTION 161d.
OF THE ATOMIC ENERGY ACT WITH THE COMPETITIVE CIVIL SERVICE
SYSTEM
The basic difference between the excepted personnel system pro-
vided by Section 161d. of the Atomic Energy Act and the competi-
tive civil service system is that the excepted system is designed to be
uniquely responsive to the management needs of a highly technical
research, development and regulatory program. The competitive civil
service system is designed to implement the Civil Service Act of 1883
and related civil service laws, which require a broad merit employ-
ment program covering as much Government activity as possible and
which emphasize fair and equitable treatment of all citizens applying
for positions in, or employed by, the Government.
The excepted personnel system under section 161d. was developed
because of a clear Congressional intent to have a personnel program
that would be as effective as possible in supporting technical research,
development- and regulatory activities, and at the same time, assure
fair and equitable treatment of all candidates and employees of the
organization. This Congressional intent has been successfully carried
out. Significant improvements in recruitment methods, selection pro-
cedures, job evaluation and pay methods, and executive manpower
management, techniques, as well as positive modifications in other func-
tional areas, can be demonstrated and confirmed in the excepted per-
sonnel program of Section 161d. of the Atomic Energy Act.
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APPENDIX 3-A
ASSISTANT ADMINISTRATOR
FOR
FOSSIL ENERGY DEVELOPMENT
IIVI
L ^bn S
Aeniwd h:MJOR
-wmamRm sr.w.
wiAbF TmFdgiCROm.l r, S.rrcr. wl
Cwwnnbn I
ASSISTANT ADMINISTRATOR
FOR
NUCLEAR ENERGY
DEVELOPMENT (IVI
rd Al,uUn
Ibn n y ~ANYn
Rreelw W~ ~nLLen
TT. SMR~ Adlrry Ca* .MEET AA D
FIELD OFFICES, CONTRACTOR OPERATIONS.( Dix M.kMmrnIRpeNry
INSTALLATIONS, LABORATORIES --~ MM.mm~N Rrpertlry
ASSISTANT ADMINISTRATOR
FOR ENV
ASSISTANT ADMINISTRATOR
ASSISTANT ADMINISTRATOR
IRONMENT, SAFETY,
NIB CONSERVATION
FOR RESEARCH AND
ADVANCED ENERGY SYSTEMS
FOR
NATIONALSECURITY
(IVI
(IVI
(NI
rv F.- S
APPENDIX 3-B
OFFICE OF
GENERAL
COUNSEL V
NUCLEAR ENERGY COMMISSION
CHAIRMAN II
COMMISSIONERS (4) III
OFFICE OF
SECRETARY
AND PUBLIC AFFAIRS
DIRECTORATE
OF LICENSING
(DIRECTOR)
OFFICE OF
THE
CONTROLLER
DIRECTORATE OF
STANDARDS
(DIRECTOR)
ATOMIC SAFETY
AND LICENSING
BOARD PANEL
DIRECTORATE
INSPECT ON AND
ENFORCEMENT
(DIRECTOR)
ATOMIC SAFETY
AND LICENSING
APPEAL PANEL
CONFIRMATORY
ASSESSMENT
(DIRECTOR)
COMMITTEE ON
REACTOR
SAFE UARDS
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APPENDIX 4.-TEXT OF COMMITTEE BILL AS REPORTED
SHORT TITLE
SECTION 1? This Act may be cited as the "Energy Reorganization
Act of 1973".
SEC. 2. (a`) The Congress hereby declares that the general welfare
and the common defense and security require effective action to de-
velop, and increase the efficiency and reliability of use of, all energy
sources to meet the needs of present and future generations, to increase
the productivity of the national economy and strengthen its position in
regard to international trade, to make the Nation self-sufficient in
energy, to advance the goals of restoring, protecting, and enhancing
environmental quality, and to assure public health and safety.
(b) The Congress finds that, to best achieve these objectives, im-
prove Government operations, and assure the coordinated and effec-
tive development of all energy sources, it is necessary to establish an
Energy Research and Development Administration to bring together
and direct Federal activities relating to research and development on
the various sources of energy, to increase the efficiency and reliability
in the use of energy, and to carry out the performance of other func-
tions, including the Atomic Energy Commission's military and pro-
duction activities.
(c) The Congress further declares and finds that it is in the public
interest that the licensing and related regulatory functions of the
Atomic Energy Commission be separated from the performance of the
other functions of the Commission transferred pursuant to this Act,
and that this separation be effected in an orderly manner assuring ade-
quacy of technical and other resources necessary for the performance of
each.
TITLE I--ENERGY RESEARCH AND DEVELOPMENT
ADMINISTRATION
SEC. 101. There is hereby established an independent executive agen-
cy to be known as the Energy Research and Development Administra-
tion (hereinafter in. this Act referred to as the "Administration").
SEC. 102. (a) There shall be at the head of the Administration an
Administrator of Energy Research and Development (hereinafter
in this Act referred to as the "Administrator"), who shall be appointed
by the President, by and with the advice and consent of the Senate. The
(46)
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Administrator shall receive compensation at the rate now or hereafter
prescribed for offices and positions at level IT of the Executive Sched-
ule (5 U.S.C. 5313). The Administration shall be administered under
the supervision and direction of the Administrator, who shall be re-
sponsible for the efficient and coordinated management of the Ad-
ministration.
(b) There shall be in the Administration a Deputy Administrator,
who shall be appointed by the President, by and with the advice and
consent of the Senate, and who shall receive compensation at the rate
now or hereafter prescribed for officers and positions at level III of
the Executive Schedule (5 U.S.C. 5314).
(c) There shall be in the Administration five Assistant Adminis-
trators, one of whom shall be responsible for fossil energy, another for
nuclear energy, another for environment, safety, and conservation, an-
other for research and advanced energy systems, and another for na-
tional security. The Assistant Administrators shall be appointed by
the President, by and with the advice and consent of the Senate, and
shall receive compensation at the rate now or hereafter prescribed for
offices and positions at level IV of the Executive Schedule (5 U.S.C.
5315).
(d) There shall be in the Administration a General Counsel who
shall be appointed by the Administrator and who shall serve at the
pleasure of and be removable by the Administrator. The General
Counsel shall receive compensation at the rate now or hereafter pre-
scribed for offices and positions at level V of the Executive Schedule
(5 U.S.C. 5316).
(e) There shall be in the Administration not more than seven addi-
tional officers appointed by the Administrator, who shall receive com-
pensation at the rate now or hereafter prescribed for offices and posi-
tions at level V of the Executive Schedule (5 U.S.C. 5316). The posi-
tions of such officers shall be considered career positions and be sub-
ject to subsection 161d. of the Atomic Energy Act.
(f) The Division of Military Application transferred to and estab-
lished in the Administration by section 104(a) of this Act shall be
under the direction of a Director of Military Application, who shall be
appointed by the Administrator and who shall serve at the pleasure
of and be removable by the Administrator and shall be an active com-
missioned officer of the Armed Forces serving in general or flag officer
rank or grade. The functions, qualifications, and compensation of the
Director of Military Application shall be the same as those provided
under the Atomic Energy Act of 1954, as amended, for the Assistant
General Manager for Military Application.
(g) Officers appointed pursuant to this section shall perform such
functions as the Administrator, shall specify from time to time.
(h) The Deputy Administrator (or in the absence or disability of
the Deputy Administrator, or in the event of a vacancy in the office
of the Deputy Administrator, an Assistant Administrator, the General
Counsel or such other official, determined according to such order as
the Administrator shall prescribe) shall act for and perform the func-
tions of the Administrator during any absence or disability of the
Administrator or in the event of a vacancy in the office of the Admin-
istrator.
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RESPONSIBILITIES OF THE ADMINISTRATOR
SEC. 103. The responsibilities of the Administrator shall include,
but not be limited to-
(1) exercising central responsibility for policy planning, coor-
dination, support, and management of research and development
programs respecting all energy sources, including assessing the
requirements for research and development in regard to various
energy sources in relation to near-term and long-range needs,
policy planning in regard to meeting those requirements, under-
taking programs for the optimal development of the various forms
of energy sources, managing such programs, and disseminating
information resulting therefrom;
(2) encouraging and conducting research and development to
demonstrate the commercial feasibility and practical applications
of energy sources and utilization technologies;
(3) undertaking research and development in the extraction,
conversion, storage, transmission, and utilization phases related
to the development and use of energy from fossil, nuclear, solar,
geothermal, and other energy sources;
(4) engaging in and supporting environmental, biomedical,
physical, and safety research related to the development of energy
sources and utilization technologies;
(5) taking into account the existence, progress, and results of
other public and private -research and development activities
relevant to the Administration's mission in formulating its own
research. and development programs;
(6) participating in and supporting cooperative research and
development projects which may involve contributions by public
or private persons or agencies, of financial or other resources to
the performance of the work;
(7) developing, collecting, distributing, and making available
for distribution, scientific and technical information concerning
the manufacture or development of energy and its efficient extrac-
tion, conversion, transmission, and utilization; and
(8) encouraging and conducting research and development for
the conservation of energy.
SEc. 104. (a) There are hereby transferred to and vested in the Ad-
ministrator all functions of the Atomic Energy Commission, the
Chairman and members of the Commission, and the officers and com-
ponents of the Commission., except as otherwise provided in this Act.
(b) The General Advisory Committee established pursuant to sec-
tion 26 of the Atomic Energy Act of 1954, as amended (42 U.S.C.
2036), the Patent Compensation Board established pursuant to sec-
tion 157 of the Atomic Energy Act of 1954, as amended (42 U.S.C.
2187), and the Divisions of Military Application and Naval Re-
actors established pursuant to section 25 of the Atomic Energy Act
of 1954, as amended (42 U.S.C. 2035), are transferred to the Energy
Research and Development Administration and the functions of the
Commission with respect thereto, and with respect to relations with
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the Military Liaison Committee established by section ?27 of the Atomic
Energy Act of 1954, as amended (42 U.S.C. 2037), are transferred to
the Administrator.
(c) There are hereby transferred to and vested in the Administrator
such functions of the Secretary of the Interior, the Department of the
Interior, and officers and components of such department-
(1) as relate to or are utilized by the Office of Coal Research
established pursuant to the Act of July 1, 1960 (74 Stat. 336; 30
U.S.C.661-668);
(2) as relate to or are utilized in connection with fossil fuel
energy research and development programs and related activities
conducted by the Bureau of Mines "energy centers" and synthane
plant to provide greater efficiency in the extraction, processing,
and utilization of energy resources for the purpose of conserv-
ing those resources, developing alternative energy resources such
as oil and gas secondary and tertiary recovery, 411 shale and syn-
thetic fuels, improving methods of managing energy-related
wastes and pollutants, and providing technical guidance needed
to establish and administer national energy policies; and
(3) as relate to or are utilized for underground electric power
transmission research.
(d) There are hereby transferred to and vested in the Administra-
tor such functions of the National Science Foundation as relate to or
are utilized in connection with-
(1) solar heating and cooling development; and
(2) geothermal power development.
(e) There are hereby transferred to and vested in the Administra-
tor such functions of the Environmental Protection Agency and the
officers and components thereof as relate to or are utilized in connec-
tion with-
(1) the development and demonstration of alternative auto-
motive power systems; and
(2) the development and demonstration of precombustion,
combustion, and postcombustion technologies to control emissions
of pollutants from stationary sources using fossil fuels.
(f) To the extent necessary or appropriate to perform functions
and carry out programs transferred by this Act, the Administrator
may exercise, in relation to the functions so transferred, any author-
ity or part thereof available by law, including appropriation Acts,
to the official or agency from which such functions were transferred.
SEC. 105. (a) Except as provided in the next sentence, the person-
nel employed in connection with, and the personnel positions, assets,
liabilities, contracts, property, records, and unexpended balances of
appropriations, authorizations, allocations, and other funds employed,
held, used, arising from, available to or to be made available in con-
nection with the functions and programs transferred by this Act, are,
subject to section 202 of the Budget and Accounting Procedures Act
of 1950 (31 U.S.C. 581c), correspondingly transferred for appropriate
'allocation. Personnel positions expressly created by law, personnel
occupying those positions on the effective date of this Act, and per-
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sonnel authorized to receive compensation at the rate prescribed for
offices and positions at levels II, III, IV, or V of the Executive Sched-
ule (5 U.S.C. 5313-5316) on the effective date of this Act shall be
subject to the provisions of subsection (c) of this section and section
301 of this Act.
(b) Except as provided in subsection (c), transfer of nontemporary
personnel pursuant to this Act shall not cause any such employee to
be separated or reduced in grade or compensation for one year after
such transfer.
(c) Any person who, on the effective date of this Act, held a posi-
tion compensated in accordance with the Executive Schedule pre-
scribed in chapter 53 of title 5 of the United States Code, and who,
without a break in service, is appointed in the Administration to a
position having duties comparable to those performed immediately
preceding his appointment shall continue to be compensated in his new
position at not less than the rate provided for his previous position.
SEC. 106. (a) The Administrator is authorized to prescribe such
policies, standards, criteria, procedures, rules, and regulations as he
may deem to be necessary or appropriate to perform functions now or
hereafter vested in him.
(b) The Administrator shall engage in such policy planning, and
perform such program evaluation analyses and other studies, as may
be necessary to promote the efficient and coordinated administration
of the Administration and properly assess progress toward the achieve-
ment of its missions.
(c) Except as otherwise expressly provided by law, the Adminis-
trator may delegate any of his functions to such officers and employees
of the Administration as lie may designate, and may authorize such
successive redelegations of such functions as he may deem to be neces-
sary or appropriate.
(d) Except as provided in section 102 and in section 104(b), the
Administrator may organize the Administration as he may deem to be
necessary or appropriate.
(e) The Administrator is authorized to establish, maintain, alter,
or discontinue such State, regional, district, local, or other field offices
as he may deem to be necessary or appropriate to perform functions
now or hereafter vested in him.
(f) The Administrator shall cause a seal of office to be made for
the Administration of such device as he shall approve, and judicial
notice shall be taken of such sear.
(g) The Administrator is authorized to establish a working capital
fund, to be available without fiscal year limitation, for expenses neces-
sary for the maintenance and operation of such common administra-
Live services as he shall find to be desirable in the interests of economy
and efficiency. Then, shall be transferred to the fund the stocks of sup-
plies, equipment, assets other than real property, liabilities, and unpaid
obligations relating to the services which he determines will be per-
formed through the fund. Appropriations to the fund, in such amounts
as may be necessary to provide additional working capital, are author-
ized. The working capital fund shall recover, from the appropriations
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and funds for which services are performed, either in advance or by
way of reimbursement, amounts which will approximate the costs
incurred, including the accrual of annual leave and the depreciation
of equipment. The fund shall also be credited with receipts from the
sale or exchange of its property, and receipts in payment for loss or
damage to property owned by the fund.
(h) Each department, agency, and instrumentality of the executive
branch of the Government is authorized to furnish to the Administra-
tor, upon his request, any information or other data which the Ad-
ministrator deems necessary to carry out his duties under this title.
SEc. 107. (a) The Administrator is authorized to select, appoint,
employ, and fix the compensation of such officers and employees, in-
cluding attorneys, pursuant to section 161d. of the Atomic Energy Act
of 1954, as amended (42 U.S.C. 2201(d)) as are necessary to perform
the functions now or hereafter vested in him and to prescribe their
functions.
(b) The Administrator is authorized to obtain services as provided
by section 3109 of title 5 of the United States Code.
(c) The Administrator is authorized to provide for participation of
military personnel in the performance of his functions. Members of
the Army, the Navy, the Air Force, or the Marine Corps may be de-
tailed for service in the Administration by the appropriate military
Secretary, pursuant to cooperative agreements with the Secretary, for
service in the Administration in positions other than a position the
occupant of which must be approved by and with the advice and con-
sent of the Senate.
(d) Appointment, detail, or assignment to, acceptance of, and serv-
ice in, any appointive or other position in the Administration under
this section shall in no ;way affect the status, office, rank, or grade
which such officers or enlisted men may occupy or hold, or any emolu-
ment, perquisite, right, privilege, or benefit incident to or arising out
of any such status, office, rank, or grade. A member so appointed, de-
tailed, or assigned shall not be subject to direction or control by his
armed force, or any officer thereof, directly or indirectly, with respect
to the responsibilities exercised in the position to which appointed,
detailed, or assigned.
(e) The Administrator is authorized to pay transportation ex-
penses, and per diem in lieu of subsistence expenses, in accordance
with chapter 57 of title 5 of the United States Code for travel between
places of recruitment and duty, and while at places of duty, of persons
appointed for emergency, temporary, or seasonal services in the field
service of the Administration.
(f) The Administrator is authorized to utilize, on a reimbursable
basis, the services of any personnel made available by any department,
agency, or instrumentality, including any independent agency, of the
Government.
(g) The Administrator is authorized to establish advisory boards,
in accordance with the provisions of the Federal Advisory Committee
Act (Public Law 92-463), to advise with and make recommendations
to the Administrator on legislation, policies, administration, research,
and other matters.
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(h) The Administrator is authorized to employ persons who are not
citizens of the United States in expert,, scientific, technical, or profes-
sional capacities whenever he deems it in the public interest.
SEC. 108. (a) The Administrator is authorized to exercise his powers
in such manner as to insure the continued conduct of research and
development and related activities in areas or fields deemed by the
Administrator to be pertinent to the acquisition of an expanded fund
of scientific, technical, and practical knowledge in energy matters. To
this end, the Administrator is authorized to make arrangements
(including contracts, agreements, and loans) for the conduct of
research and development activities with private or public institutions
or persons, including participation in joint or cooperative projects of a
research, developmental, or experimental nature; to make payments
(in lump sum or installments, and in advance or by way of reimburse-
ment, with necessary adjustments on account of overpayments or
underpayments) ; and generally to take such steps as he may deem
necessary or appropriate to perform functions now or hereafter vested
in him. Sucre functions of the Administrator under this Act as are
applicable to the nuclear activities transferred pursuant to this title
shall be subject to the provisions of the Atomic Energy Act of 1954,
as amended, and to other authority applicable to such nuclear activi-
ties. The nonnuclear responsibilities and functions of the Adminis-
trator referred to in sections 103 and 104 of this Act shall be carried
out pursuant to the provisions of this Net, applicable authority exist-
ing immediately before the effective date of this Act, or in accordance
with the provisions of chapter 4 of the Atomic Energy Act of 1954, as
amended (42 U.S.C. 2051-2053).
(b) Except for public buildings as defined in the Public Buildings
Act of 1959, as amended, and with respect to leased space subject to
the provisions of Reorganization Plan Numbered 18 of 1950, the
Administrator is authorized to acquire (by purchase, lease, condemna-
tion, or otherwise), construct, improve, repair, operate, and maintain
facilities and. real property as the Administrator deems to be neces-
sary in and outside of the District of Columbia. Such authority shall
apply only to facilities required for the maintenance and operation
of laboratories, research and testing sites and facilities, quarters, and
related accommodations for employees and dependents of employees
of the Administration, and such other special-purpose real property
as the Administrator deems to be necessary in and outside the District
of Columbia. Title to any property or interest therein, real, personal,
or mixed, acquired pursuant to this section, shall be in the United
States.
(c) (1) The Administrator is authorized to provide, construct, or
maintain, as necessary and when not otherwise available, the following
for employees and their dexnend ants stationed at remote locations :
(A) emergency medical services. and supplies;
(B) food and other subsistence supplies;
(C) messing facilities;
(D) audiovisual equipment, accessories, and supplies for rec-
reation and training;
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(E) reimbursement of food, clothing, medicine, and other sup-
plies furnished by such employees in emergencies for the tem-
porary relief of distressed persons;
(F) living and working quarters and facilities; and
(G) transportation for school-age dependents of employees to
the nearest appropriate educational facilities.
(2) The furnishing of medical treatment under subparagraph (A)
of paragraph (1) and the furnishing of services and supplies under
paragraphs (B) and (C) of paragraph (1) shall be at prices reflect-
ing reasonable value as determined by the Administrator.
(3) Proceeds from reimbursements under this section shall be de-
posited in the Treasury and may be withdrawn by the Administrator
to pay directly the cost of such work or services, to repay or make ad-
vances to appropriations or funds which do or will bear all or a part
of such cost, or to refund excess sums when necessary ; except that such
payments may be credited to a service or working capital fund other-
wise established by law, and used under the law governing such funds,
if the fund is available for use by the Administrator for performing
the work or services for which payment is received.
(d) The Administrator is authorized to acquire any of the follow-
ing described rights if the property acquired thereby is for use in, or
is useful to, the performance of functions vested in him :
(1) copyrights, patents, and applications for patents, designs,
processes, specifications, and data;
(2) licenses under copyrights, patents, and applications for
patents; and
(3) releases, before suit is brought, for past infringement of
patents or copyrights.
(a) Subject to the provisions of chapter 12 of the Atomic Energy
Act (42 U.S.C. 2161-2166), and other applicable law, the Administra-
tor shall disseminate scientific, technical, and practical information
acquired pursuant to this title through information programs and
other appropriate means, and shall encourage the dissemination of
scientific, technical, and practical information relating to energy so
as to enlarge the fund of such information and to provide that free
interchange of ideas and criticism which is essential to scientific and
industrial progress and public understanding.
(f) The Administrator is authorized to accept, hold, administer,
and utilize gifts, and bequests of property, both real and personal,
for the purpose of aiding or facilitating the work of the Administra-
tion. Gifts and bequests of money and proceeds from sales of other
property received as gifts or bequests shall be deposited in the Treas-
ury and shall be disbursed upon the order of the Administrator. For
the purposes of Federal income, estate, and gift taxes, property ac-
cepted under this section shall be considered as a gift or bequest to the
United States.
TITLE II-NUCLEAR ENERGY COMMISSION
SEC. 201. The Atomic Energy Commission is hereby renamed the
Nuclear Energy Commission and shall continue to perform the licens-
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ing and related regulatory functions of the Chairman and members
of the Commission, the general counsel, and other officers and com-
ponents of the Commission, which functions, officers, components, and
personnel are excepted from the transfer to the Administrator by
section 104 (a) of this Act.
LICENSING AND RELATED REGULATORY FUNCTIONS RESPECTING SELECTED
ADMINISTRATION FACILITIES
SEC. 202. Notwithstanding the exclusions provided for in section
110a. or any other provisions of the. Atomic Energy Act of 1954, as
amended (42 U.S.C. 2140(a) ), the Nuclear Energy Commission shall,
except as otherwise specifically provided by section 110b. of the Atomic
Energy Act of 1954, as amended (42 U.C. 2140(b) ), or other law,
have licensing and related regulatory authority pursuant to chapters
6, 7, 8, and 10 of the Atomic Energy Act of 1954, as amended, as to
the following facilities of the Administration :
(1) demonstration liquid metal fast breeder reactors when
operated as part of the power generation facilities of an electric
utility system
(2) other demonstration nuclear reactors when operated as part
of the power generation facilities of an electric utility system,
except those in existence, under construction or authorized or ap-
propriated for by the Congress on the date this part becomes
effective; or
(3) facilities used primarily for the receipt and storage of high-
level radioactive wastes resulting from activities licensed under
such Act, except those in existence, under construction, or author-
ized or appropriated for by the Congress, on the date this Act
becomes effective.
SEC. 203. (a) The Nuclear Energy Commission may engage in or
contract for research which the Commission deems necessary for the
discharge of its licensing and related regulatory functions.
(b) In order to achieve the objectives and carry out the purposes of
subsection (a), the Energy Research and Development Administration
and every other Federal agency shall--
(1) ,-ooperate with respect to the establishment of priorities
for the furnishing of such research services requested by the Nu-
clear Energy Commission as the Commission deems necessary for
the conduct of its functions; and
(2) furnish to the Nuclear Energy Commission, when requested,
on a reimbursable basis, through- its own facilities or by contract
or other arrangement, such research services as the Commission
deems necessary for the conduct of its functions.
TITLE III-MISCELLANEOUS AND TRANSITIONAL
PROVISIONS
SEC. 301. (a) Except as otherwise provided in this Act, whenever
all of the functions or programs of an agency, or other body, or any
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component thereof, affected by this Act, have been transferred from
that agency, or other body, or any component thereof by title I of this
Act, the agency, or other body, or component thereof shall lapse. If
an agency, or other body, or any component thereof, lapses pursuant
to the preceding sentence, each position and office therein which was
expressly authorized by law, or the incumbent of which was author-
ized to receive compensation at the rate prescribed for an office or
position at level II, III, IV, or V of the Executive Schedule (5 U.S.C.
5313-5316), shall lapse.
(b) All orders, determinations, rules, regulations, permits, contracts,
certificates, licenses, and privileges-
(1) which have been issued, made, granted, or allowed to become
effective by the President, any Federal department or agency or
official thereof, or by a court of competent jurisdiction, in the
performance of functions which are transferred under this Act,
and
(2) which are in effect at the time this Act takes effect,
shall continue in effect according to their terms until modified, termi-
nated, superseded, set aside, or revoked by the President, the Admin-
istrator, or other authorized officials, a court of competent jurisdiction,
or by operation of law.
(c) The provisions of this Act shall not affect any proceeding
pending, at the time this section takes effect, before any department
or agency (or component thereof) functions of which are transferred
by this Act; but such proceedings, to the extent that they relate to
functions so transferred, shall be continued. Orders shall be issued in
such proceedings, appeals shall be taken therefrom, and payments
shall be made pursuant to such orders, as if this Act had not been
enacted; and orders issued in any such proceedings shall continue in
effect until modified, terminated, superseded, or revoked by a duly
authorized official, by a court of competent jurisdiction, or by operation
of law. Nothing in this subsection shall be deemed to prohibit the dis-
continuance or modification of any such proceeding under the same
terms and conditions and to the same extent that such proceeding
could have been discontinued if this Act had not been enacted.
(d) Except as provided in subsection (f)-
(1) the provisions of this Act shall not affect suits commenced
prior to the date this Act takes effect, and
(2) in all such suits proceedings shall be had, appeals taken,
and judgments rendered, in the some manner and effect as if this
Act had not been enacted.
(e) No suit, action, or other proceeding commenced by or against
any officer in his official capacity as an officer of any department or
agency, functions of which are transferred by this Act, shall abate
by reason of the enactment of this Act. No cause of action by or against
any department or agency, functions of which are transferred by this
Act, or by or against any officer thereof in his official capacity shall
abate by reason of the enactment of this Act. Causes of actions, suits,
actions, or other proceedings may be asserted by or against the United
States or such official as may be appropriate and, in any litigation
pending when this section takes effect, the court may at any time, on its
own motion or that of any party, enter any order which will give effect
to the provisions of this section.
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(f) If, before the date on which this Act takes effect, any depart-
ment or agency, or officer thereof in his official capacity, is a party to
a suit, and under this Act any function of such department, agency,
or officer is transferred to the Administrator, or any other official, then
such suit shall be continued as if this Act had not been enacted, with
the Administrator, or other official, as the case may be, substituted.
(gg) Final orders and actions of any official or component in the
performance of functions transferred by this Act shall be subject to
judicial review to the same extent and in the same manner as if such
orders or actions had been made or taken by the officer, department,
agency, or instrumentality in the performance of such functions im-
mediately preceding the effective date of this Act. Any statutory re-
quirements relating to notices, hearings, action upon the record, or
administrative review that apply to any function transferred by this
Act shall apply to the performance of those functions by the Adminis-
trator, or any officer or component.
(h) With respect to any function transferred by this Act and per-
formed after the effective date of this Act, reference in any other law
to any department or agency, or any officer or office, the functions of
which are so transferred, shall be deemed to refer to the Administra-
tion, the Administrator, or other office or official in which this Act
vests such functions.
(i) Nothing contained in this Act shall be construed to limit, curtail,
abolish, or terminate any function o-F the President which he had im-
mediately before the effective date of this Act; or to limit, curtail,
abolish, or terminate his authority to perform such function; or to
limit, curtail, abolish, or terminate his authority to delegate, redele-
gate, or terminate any delegation of functions.
(j) Any reference. in this Act to any provision of law shall be deemed
to include, as appropriate, references thereto as now or hereafter
amended or supplemented.
(k) Except as may be otherwise expressly provided in this Act, all
functions expressly conferred by this Act shall be in addition to and
not in substitution for functions existing immediately before the effec-
tive date of this Act and transferred. by this Act.
SEC. 302. The Director of the Office of Management and Budget is
authorized to make such additional incidental dispositions of person-
nel, personnel positions, assets, liabilities, contracts, property, records,
and unexpended balances of appropriations, authorizations, alloca-
tions, and other funds held, used, arising from, available to or to be
made available in connection with functions transferred by this Act, as
he may deem necessary or appropriate to accomplish the intent and
purpose of this Act.
SEC. 303. As used in this Act--
(1) any referenceto "function" or "functions" shall be deemed
to include references to duty, obligation, power, authority, respon-
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sibility, right, privilege, and activity, or the plural thereof, as the
case may %e; and
(2) any reference to "perform" or "performance", when used
in relation to functions, shall be deemed to include the exercise
of power, authority, rights, and privileges.
SEC. 304. Except as otherwise provided by law, appropriations made
under this Act shall be subject to annual authorization.
SEC. 305. Section 166. "Comptroller General Audit" of the Atomic
Energy Act of 1954, as amended, shall be deemed to be applicable
respectively, to the nuclear and nonnuclear activities under title I
and to the activities under title II.
SEC. 306. (a) The Administrator shall, as soon as practicable after
the end of each fiscal year, make a report to the President for submis-
sion to the Congress on the activities of the Administration during the
preceding fiscal year. Such report shall include a statement of the short-
range and long-range goals, priorities, and plans of the Administration
together with an assessment of the progress made toward the attain-
ment of those objectives and toward the more effective and efficient
management of the Administration and the coordination of its
functions.
(b) During the first year of operation of the Administration, the
Administrator, in collaboration with the Secretary of Defense, shall
conduct a thorough review of the desirability and feasibility of trans-
ferring to the Department of Defense or other Federal agencies the
functions of the Administrator respecting military application and
restricted data, and within one year after the Administrator first takes
office the Administrator shall make a report to the President, for
submission to the Congress, setting forth his comprehensive analysis,
the principal alternatives, and .the specific recommendations of the
Administrator and the Secretary of Defense.
SEC. 307. The Administrator shall keep the appropriate congres-
sional committees fully and currently informed with respect to all of
the Administration's activities.
SEc. 308. The Administrator, when authorized in an appropria-
tion Act, may, in any fiscal year, transfer funds from one appropria-
tion to another within the Administration : Provided, That no appro-
priation shall be either increased or decreased pursuant to this section
by more than 5 per centum of the appropriation for such fiscal year.
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58
SEC. 309. Subchapter II (relating to Executive Schedule pay rates)
of chapter 53 of title 5, United States Code, is amended as follows :
(1) Section 5313 is amended. by striking out "(8) Chairman,
Atomic Energy Commission." and inserting in lieu thereof "(8)
Chairman, Nuclear Energy Commission.", and by adding at the
end thereof the following :
"(22) Administrator of Energy Research and Development.".
(2) Section 5314 is amended by striking out "(42) Members,
Atomic Energy Commission." and inserting in lieu thereof "(42)
Members, Nuclear Energy Commission.", and by adding at the
end thereof the following:
"(60) Deputy Administrator, Energy Research and Develop-
ment Administration.".
(3) Section 5315 is amended by striking out paragraph (50),
and by adding at the end thereo f the following :
"(9!)) Assistant Administrators, Energy Research and Devel-
opment Administration (5).".
(4) Section 5316 is amended by striking out paragraphs (2.9),
(69), and (102), by striking out "(62) Director of Regulation,
Atom:Lc Energy Commission." and inserting in lieu thereof "(62
Executive Director of Operations, Nuclear Energy Commission.",
by striking out "(81) General Counsel of the Atomic Energy
Commission." and inserting in lieu thereof "(81) General Coun-
sel of the Nuclear Energ-
y Commission.", and by adding at the
end thereof the following:
"(133) General Counsel, Energy Research and Development
Administration.
"(134) Additional officers, Energy Research and Development
-Administration (7).".
S EPARAI3ILITY
SEc. 310. If any provision of this Act, or the application thereof to
any person or circumstance, is held invalid, the remainder of this Act,
and the application of such provision to other persons or circum-
stances, shall not be affected thereby.
SEc. 311. (a) The provisions of this Act shall take effect one hun-
dred and twenty days after the Administrator first takes office, or on
such earlier date as the President may prescribe and publish in the
Federal Register; except that any of the officers provided for in title
II of this Act may be nominated and appointed, as provided in that
title, at any time after the date of enactment of this Act. Funds avail-
able to any department or agency (or any official or component there-
of), any functions of which are transferred to the Administrator by
this Act, may, with the approval of the President, be used to pay the
compensation and expenses of any officer appointed pursuant to this
subsection until such time as funds for that purpose are otherwise
available.
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(b) In the event that any officer required by this Act to be appointed
by and with the advice and consent of the Senate shall not have en-
tered upon office on the effective date of this Act, the P>. ;ident may
designate any officer, whose appointment was required to be made by
and with the advice and consent of the Senate and who was such an of-
ficer immediately prior to the effective date of this Act, to act in such
office until the office is filled as provided in this Act. While so acting,
such persons shall receive compensation at the rates provided by this
Act for the respective offices in which they act.
TITLE IV-SEX DISCRIMINATION
SEC. 401. No person shall on the ground of sex be excluded from par-
ticipation in, be denied a license under, be denied the benefits of, or
be subjected to discrimination under, any program or activity carried
on or receiving Federal assistance under any title of this Act. This
provision will be enforced through agency provisions and rules simi-
lar to those already established, with respect to racial and other dis-
crimination, under title VI or the Civil Rights Act of 1964. However,
this remedy is not exclusive and will not prejudice or cut off any other
legal remedies available to a discriminates.
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ADDITIONAL VIEWS OF HON. BENJAMIN S. ROSENTHAL
I strongly support the concept of centralizing the Federal Govern-
ment's energy research effort and of separating the AEC's regulation
and promotional activities. H.R.11510, as amended, appears to be a con-
structive step forward in our Nation's attempt to maximize its exist-
ing and potential energy resources.
Because the Energy Research and Development Administration
(ERDA) will be the prime governmental focus of our energy re-
search effort and because it will be directing the expenditure of many
billions of public tax dollars over the next decade, it is imperative that
the agency's operations and activities benefit the broad public interest.
Based on my understanding of the language of the bill and the in-
tentions of the members of the committee voting for it, ERDA has
been designed to fulfill that broad public purpose. Its policies and
programs are to be guided by the following principles :
ERDA's research and development efforts will be substantially
balanced between nuclear and fossil energy research, on the one
hand, and advanced energy systems (i.e., solar, geothermal, etc.),
on the other. No single energy technology will dominate ERDA's
mission ;
With respect to the disposition of the fruits of the Government's
energy research and development effort, all nuclear and non-
nuclear R. & D. transferred to the Administration shall be gov-
erned by property and information rights as provided for in ex-
isting law;
The Nuclear Energy Commission, which will continue to have
full licensing and regulatory authority over nuclear. power sys-
tems, has authority to engage in or contract for nuclear safety
research or other research which it deems necessary for the dis-
position of its licensing and related regulatory functions. ERDA
shall also furnish to the NEC, when requested, such research
services as the Commission deems necessary for the conduct of
its functions ; and,
Environmental, consumer and related factors will play a major
role in ERDA's policies and programs.
The Energy Research and Development Administration will not be
able to achieve its intended purpose unless it avoids, absent substantial
scientific evidence to the contrary, any biases which favor one energy
technology over another; and only if all its operations ,and activities
foster the highest degree of free and open competition in all segments
of the energy industry.
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ADDITIONAL VIEWS OF HON. JIM WRIGHT
NEEDED : A NATIONAL ENERGY PLAN OF ACTION
This bill is useful in that it will equip the Executive branch of
government with the operational framework through which to admin-
ister a cohesive, unified national energy plan. But Congress still needs
to formulate and adopt such a plan.
The nation looks to Congress for leadership in the energy crisis.
Leadership involves facing the whole unpleasant truth and coming
forward with a definite, consistent and coordinated plan of action not
merely to cope with present difficulties but to anticipate and head off
the far more serious crisis which inevitably will confront the nation
if our vision is too short and our response too timid.
The public will not be well served if the primary Congressional
"initiative" consists merely of turning over yet another wide range
of discretionary policy making powers to the Executive branch of
government. Not only is such a posture ludicrously at odds with our
protestations against Presidential usurpation of of legislative preroga-
tives. It also would represent a "cop out" by the people's elected repre-
sentatives on the hard decisions that shape the future in this singly
most significant domestic problem of our time.
The plan presented in this paper is based upon the following prem-
ises, which I believe to be valid :
1. The energy shortage is quite real and truly serious. It has been
coming upon us for a long time. The Arab oil blockade has merely
hastened our inevitable day of reckoning.
2. It is not and should not be regarded as a temporary problem. It
will grow inexorably more binding and more inhibiting upon our way
of life until we find alternate basic sources of energy to replace our
present profound reliance upon petroleum.
3. While there are things that we can and must do to "share the
shortage" and alleviate immediate hardships, the energy shortage will
not be solved by short-range palliatives taken during the coming
winter. It is a problem of the coming decade. and we'd better deal with
it as such. Trying to temporize or to muddle through from crisis to
crisis will only postpone a real beginning upon the necessary long-
range solutions.
4. There is no painless solution, and any effective actions will involve
certain costs and sacrifices upon the part of the American public. The
citizens of this country, however, would rather be told the truth than
to be lulled and pampered into a false sense of complacency. They
will sacrifice if they see that all are sacrificing evenly and that the
common sacrifice is attaining the promised results. They will willingly
pay the necessary price in taxes so long as those taxes are reasonable
and the public understands exactly what they are going for.
(63)
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64
ENERGY TRUST FUND
With the foregoing thoughts in mind, I propose the creation of an
Energy Conservation and Development Trust Fund made up of user
taxes with the proceeds dedicated to short-, medium-, and long-term
programs designed both to reduce wasteful consumption and to de-
velop new and additional sources sufficient to meet national needs and
to attain the ultimate goal of domestic self-sufficiency.
The Trust Fund concept is not new. In the Social Security program
and the Federal Aid Highway program it has been a demonstrably
effective device for producing a long-range commitment to long-range
goals with the assured and consistent funding necessary to meet those
goals. Freed from the vagaries and uncertainties of the annual budget
submission and appropriations process and the sometimes unpre-
dictable peaks and valleys which can occur in that process, the Trust
Fund permits the development of intelligent and dependable long
term planning by both government and industry.
Revenues for the Energy Conservation and Development Trust
Fund would come from those firms and individuals engaged in activi-
ties which cause the greatest drain on energy supplies. And, as with
the Highway Trust Fund and the Social Security Trust Fund, those
paying the taxes would be the ultimate beneficiaries of the programs
funded, in that those programs would be calculated to assure to them,
as to the nation at large, a continuing supply of energy.
PROGRAMS FUNDED
I propose a $6 billion assured annual commitmaent to various na-
tional programs realistically designed to conserve and develop energy.
Considering, the monumental magnitude of the problem and the
lengthening shadow it casts upon the future of our entire economy,
such a commitment is not unreasonable. Compared with the $6 billion
annual Highway Program and the Apollo Moon Landing Program
funded over the past 12 years at an average annual outlay of about
$2 billion, a commitment of $6 billion a year to achieve national self-
sufficiency in energy seems fully appropriate.
Following is a list of those programs, together with a suggested
level of assured funding, which in my judgment could be expected to
yield maximum results :
1. Two billion dollars annually for Urban Mass Transit programs.
This sum would be in addition to, not in lieu of amounts already ap-
proved for funding out of General Revenues in the 1973 Highway
bill. It could be divided appropriately between matching funds for
capital investment in rail and bus sy-.tems and operating subsidies to
make local public transportation service a more attractive alternative
to the private automobile.
Two billion dollars a year for the entire nation should not be con-
sidered excessive when one contemplates that completion of the Wash-
ington subway system alone will probably come to some $3 billion.
Let us face the fact that improved service in such systems cannot be
economically sustained simply out of the fare box. City dwellers will
voluntarily opt for public transportation only when service is good
and fares are reasonable. With the possible exception of Montreal,
there probably is no public transportation system in any large North
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American city that is today paying its way from fares, and few if any
in Europe. To increase fares would be counterproductive.
Public transportation can be self-sustaining, but only with greatly
expanded ridership. In 1945, when there were 18.9 billion individual
passenger fares paid, the nation's bus, trolley and subway systems re-
turned a profit of 11c for every dollar in operating revenue. By 1971,
with only 5.5 billion passenger fares, they were suffering an aggregate
operating loss of 23c for each dollar taken in.
It may be recalled that earlier this year I opposed any large-scale
raid on the Highway Trust Fund for the purpose of public transporta-
tion, while supporting funding out of General Revenues. My reasons
was that there simply is not enough money in the Highway Trust Fund
to serve both purposes adequately. Highways, too, are necessary in
our efforts to conserve fuel and abate air pollution. Both fuel con-
sumption and the emission of carbons are appreciably increased by
the crowding of too many cars on outmoded and overly congested road
surfaces, with frequent starts and stops and the idling of engines. Just
as it is impossible to get two quarts of milk out of a one-quart bottle,
to pretend to serve both purposes from the finite resources available
to the one existing Trust Fund would be to shortchange both needs.
It is incontestably true, however, that maximum and efficient utiliza-
tion of public transportation will conserve significant amounts of fuel.
To this end, by helping to assure a continuing supply, public trans-
portation can perform a service to motorists everywhere who must use
private vehicles in the conduct of their daily activities.
To comprehend the potential savings, one needs only to recognize
that transportation consumes 25 percent of the total energy used in
this country, and petroleum accounts for 96 percent of that. One
gallon of fuel in a double decker suburban train can produce 200
passenger miles of travel. In an automobile carrying only one person
it will produce 20 passenger miles or less, depending upon the size
and efficiency of the automobile. Based upon its predicted ridership,
the Bay Area Rapid Transit System of Northern California-even
when considering all energy requirements such as station lighting,
control and traction systems-will be four times as energy efficient as
the automobile it displaces.
2. $200 million in annual matching grants to assist in the develop-
ment of better and more efficient inter-city commuter rail and bus sys-
tems. Such systems have long provided a useful service in places like
New Jersey and the Connecticut suburbs of New York City. Dependa-
ble service could convert daily automobile commuters to their use in
other metropolitan areas.
3. $100 million in grants, or as a replacement for revenue loss from
a system of tax incentives, to expand the nation's industrial capacity
to produce buses for local public transportation systems. One present
bottleneck to the expansion of public mass transit is the limited num-
ber of firms now engaged in the production of buses and the finite
limits of their existing production capacity. There are only some
50,000 buses currently in use in local systems, and a reported produc-
tion capacity of only about 5,000 a year-most of which are used as
replacements for older vehicles. If we are markedly to enlarge the
utilization of public transportation, we obviously must find some means
rather quickly to enlarge the capacity to produce the necessary
vehicles.
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4. One billion dollars annually to finance a crash Research and
Development program, including a number of large demonstration
plants, to convert coal as a usable, efficient and clean replacement for
gasoline, fuel oil and other petroleum products. The nation has been
piddling along for several years on a variety of processes funded at a
niggardly level, some of which have been started up only to be stopped
at half-way point when the funds ran out or the whims of policy
changed. Even so, they have produced some modest results.
Coal can be converted to such uses. Its sulphur content can be dras-
tically reduced. To develop the most, economical and efficient means
of achieving these ends will cost a great deal of money. But the
basic research exists and the time for puttering around, on a low-
budget operation has passed. Coal conversion is no longer simply a
desirable end; today it is both imperative and urgent.
At our present rate of consumption-a rate that has been taking
quantum jumps upward every year-total known domestic oil reserves,
including the Alaskan strike, are sufficient to last us for only some 15 or
16 years. But we have enough coal to last us several hundred years. As
with the Pharoah's dream of the seven fat calves and the seven lean,
we'd be the most foolish of nations to wait until the oil runs out before
providing a ready replacement. One billion dollars a year over the
next five or six years could make the vital difference.
5. One billion dollars a year for solar, nuclear and thermal energy
research. The application of the funds as between these three separate
programs should be sufficiently flexible to permit the nation to take use-
ful advantage of an unexpected scientific break-through in any of these
areas. Funds for nuclear power development should be concentrated
upon developing the means to maximize safety, and should include the
application of fusion.
But in my opinion the lion's share should be expended upon solar,
research and development. For the long run, it holds out the greatest
promise. It seems only plausible to believe that solar energy is the
ultimate answer to our problems.
Solar energy is abundant, inexhaustible and non-polluting. In an
average day, enough energy falls upon the U.S. in the form of sun-
light to supply our power needs for an entire year. And every day we
delay the real beginning of a fully funded, top priority effort at solar
energy conversion will prolong and ultimately magnify the problems
we face.
6. $200 milliow for research to develop better recovery methods for
oil shale, including ways to minimize damages to surface land and
landscape.
7. $100 million annually for it conservation program to rehabilitate,
restore and beautify lands pocked and ravaged by strip coal mining
and possible oil shale operations.
8. $500 million a year to support and if necessary to subsidize a
national program of guaranteed long-term low-interest loans to in-
dividual homeowners and operators of small business establishments
to finance improved insulation so as to preserve heat and reduce fuel
consumption. The aggregate results of such a nationwide effort could
be significant in the conservation of heating fuels.
9. $100 million a year in matching grants to states to assist in
patrolling and enforcing whatever uniform speed limits may be im-
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posed to combat the fuel shortage. Available evidence impellingly
suggests that dramatic savings in petroleum-as well as truly enor-
mous safety benefits-can be realized by reducing automotive high-
way speeds. While a high degree of voluntary compliance will be
necessary to achieve this goal, it must not be left entirely to volun-
tarism. Any such hope would be doomed to failure, for several reasons.
Human nature being what it is, a motorist cruising along faith-
fully at 50 mph will be disillusioned and totally discouraged from
compliance if other automobiles are consistently passing him at much
higher speeds, with no. apparent restraint or retribution. Moreover,
it is simply much harder to maintain a speed of 50 in a stream of
traffic which is flowing at a pace of even five or ten miles per hour
faster.
When circumstances are so austere as to require the imposition of
a national speed limit, it should be uniformly enforced. A $100 million
matching fund for enforcement, dispersed on a road mileage or popula-
tion formula, would provide $2 million a year in additional revenue for
the average state. This could be extremely useful in supplying the addi-
tional patrol cars, helicopters, radar and other speed control devices
necessary to assure uniform enforcement and to reassure the good
citizen-driver that the results of his patriotic compliance are not being
cavalierly undone by others.
10. $350 million a year as a replacement for revenues lost through
a system of incentives (tax credits or intangible drilling costs) as an
encouragement to expanded domestic oil and gas exploration. Histori-
cally, most of the petroleum discoveries in this country have been the
work of independent oil operators, most of them relatively small com-
panies and many of them "wildcatters"-guys with a rig and a rabbit
foot, a smattering of geology and a lot of guts. The maj or integrated
oil companies often develop the finds, but the original discovery usually
has been the work of the independents.
Exploration has become increasingly costly and uneconomical and
this is one reason why majors have left the bulk of it to the independ-
ents. Eight out of every nine exploratory wells are dry holes, and the
number of exploratory crews in operation in the U.S. today is only
a very small fraction of the number operating 20 years ago. As I con-
ceive it, any such tax incentive should be designed expressly to en-
courage a renewal of the type of speculative exploration without which
new discovery has been handicapped.
As will be seen in the next section of this paper, dealing with taxes
to support the Energy Conservation and Development Trust Fund, in
order to avoid either the reality or the appearance of a "windfall" to
the oil and gas industry, I shall propose a system of taxes through
which those engaged in the most profitable end of the industry will re-
place the revenue loss through severance and gathering taxes. In effect,
the industry will be paying for its own incentives.
11. $350 million a year for a fund to provide extended and improved
unemployment compensation for workers displaced from their jobs by
reason of the shortages and economic cutbacks induced by the energy
crunch, and wherever appropriate extensive programs of job retraining
so as to provide marketable skills in new types of work.
Obviously, so pervasive and severe an impact as the national energy
crisis will inevitably displace workers through changing patterns of
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industrial priorities and employment opportunities. If we are serious
about "sharing the shortage" and sacrificing evenly, then we should be
ready with effective plans to see that relatively mild social curtailment
and economic sacrifice for most of us does not result in total economic
and social disaster for a few of us.
TAXES TO SUPPORT THE TRUST FUND
Any such large undertaking as this paper suggests must, of course,
be paid for., Let us acknowledge in candor that almost any system of
taxes we may devise, however artfully contrived, will inevitably find
a great bulk of their burden being passed on in one way or another
to the ultimate consumers of the products taxed. Frankly, I know of
no effective way to avoid this. At least, we owe the public the honesty
of not pretending that it isn't so. Let us merely try to distribute the
burden fairly.
Many of its in the Congress have strongly opposed the idea of a puni-
tive tax deliberately designed to control consumption of gasoline by
artificially raising its price to one dollar a gallon or some such figure.
Such an approach would be grossly unfair since it would place its
heaviest and most onerous burden upon those Americans of low and
moderate income who must rely upon private automotive travel to
perform their daily work.
It is necessary to recognize, however, that our nation for a long time
has been the beneficiary of an Energy Subsidy of quite considerable
proportions. One gallon of gasoline in our society today produces the
work equivalent of 25 man/days-in other words, the output in effi-
cient labor of 25 men working all day or of one man working for 25
days. Shorn of taxes, that gallon of gasoline costs us just a little more
than 254--a penny for the equivalent of one man's daily labor. Never
in the bleakPSt meridians of slavery was work performed so cheaply.
Compared with what consumers elsewhere must pay-particularly
when taking into account their relatively more meager incomes-
Americans have indeed been getting a bargain at the gasoline pump.
What costs its now about 40? a gallon with all taxes absorbed is retail-
ing in Italy for $1.30 a gallon. in dapaai for $1.60, in West Germany for
$1.15 and in the average world retail market for 96?.
So, while -utterly rejecting the idea of a punitive or prohibitive tax,
we do find abundant reason in equity for additional taxes on petro-
leum and other energy-related products where the proceeds of those
taxes are dedicated to conserving the finite supply and developing
r. epl acements.
I propose, therefore, that the following taxes-or some variation of
them calculated to produce the necessary revenues-be levied and dedi-
cated to the Energy Conservation and Development Trust Fund :
1. An additional tax of 40 per gaZlon on gasoline. At our present
national volume of sales, such a, tax would produce approximately $4
billion a year for energy conservation and development. To the same
degree that our various efforts to curtail total gasoline consumption
are effective, the proceeds of the tax would diminish.
A fall-off in revenues from this particular levy in future years
would, therefore, be good news and proof that our other efforts were
working. If We should succeed in redwing total national consumption
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by 25 percent (an ambitious if not roseate assumption), a 4? per gallon
tax still would yield $3 billion annually for the Energy Trust Fund.
2. A manufacturer's excise tax on new automobiles, with the rate of
taxation deliberately tilted to place its heaviest levies upon the largest,
most luxurious vehicles which consume the greatest quantities of energy
in their operation.
Small or energy-efficient cars of the medium range would be exempt.
Perhaps an exemption should be written for any new automobile which
clocks 20 miles per gallop or better over an extended run at 50 mph.
A 5,000 pound automobile of the Cadillac or Lincoln class obviously
would not qualify. Less energy-efficient cars could pay a tax propor-
tioned to their fuel consumption.
A recent testing program by EPA, including 630 1973 vehicles, re-
vealed for example that the heaviest car (5,500 lbs.) averaged 8.8 miles
per gallon, while the smallest (2,000 lbs.) averaged 25.5 miles per gal-
lon. These figures can be scaled downward by installation of such once-
common devices as overdrive and substitution of standard for auto-
matic transmissions. The smallest vehicles obviously are not suited for
every American family or legitimate need, but it does make sense to
require those whose cars gulp the greatest quantities of the irreplace-
able national resource to pay something for that privilege into the fund
for energy conservation and development.
It has been estimated that a manufacturer's excise tax, scaled from
$300 per car on the largest and least energy-efficient to perhaps $50 per
car on those that barely exceed the 20 mph. standard, would yield-
based upon recent national patterns of production and sales-some-
where in the neighborhood of $800 million annually for the Trust
Fund. This amount, too, will gradually diminish as popular prefer-
ences develop for more energy-efficient vehicles. If so, so much the
better.
3. A manufacturer's excise tax on pleasure boats. Enjoyable as a
hobby and source of outdoor recreation, pleasure boating surely could
not be called an essential undertaking. It seems only fair, therefore,
that those who wish to consume vital sources of energy in its pursuit
should be willing to pay something into the Energy Conservation and
Development Fund for the privilege. As with the tax on new automo-
biles, I would suggest heavy taxes on boats of the yacht class, and a
downward sliding scale on other large boats.
A $300 tax on boats of more than 100 horsepower and a $100 tax of
boats of between 510 and 100 horsepower-exempting those of less than
50 horsepower-would yield some $48 million a year, based on pro-
jected sales for 1974.
4. A sales tax on all large commercial and industrial users of elec-
tricity. Utility rates typically favor the largest users who get the
benefit of quite considerably lower unit rates than are paid by the resi-
dential consumer. It seems only- fair, therefore, that those who con-
sume the most of our electrical energy supplies and pay the least per
kilowatt/hour should bear a share of the cost of conserving and devel-
oping supplies for the future.
Ways and Means Committee sources indicate that a tax of 1/10 of
a cent (one mill) per kilowatt-exempting users whose total individual
consumption is less than 30,000 kilowatts (this I am told would exempt
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all residential and small commercial users)-would yield some $900 a
year for the Trust Fund.
5. A tax on all parking lots, except for those with a capacity for
fewer than 100 automobiles. The exception would exempt only the small
parking lots operated as small businesses and those maintained by
small enerprises for the benefit of their employees and customers.
Chain commercial parking lots could. not escape payment by dividing
their operations into a number of small lots. All those under the same
ownership would be counted for purposes of the tax as one enterprise.
The tax I contemplate would be 250 per stall per day, certainly not
a prohibitive figure. A commercial parking establishment with a ca-
pacity for 1,000 cars would pay $250 a day. Assuming that this amount
would be passed on, if we further assume only three cars accommo-
dated daily for each space in the average downtown parking lot used
by shoppers, it should add no more than 100 to the parking fee of the
casual shopper. Perhaps 50. per hour.
For a person parking regularly at a given accommodation five days
a week while he works nearby, it would predictably add $1.25 to his
weekly parking fee. I should think that in fairness the same ought
to apply to large company parking lots used by employees and to pub-
lic and Federal parking lots (yes, the Rayburn Building included)
whose beneficiaries should be expected to pay just like everyone else.
Such a tax would yield an estimated $490 million a year, based on
preliminary estimates of the number of park-for-money spaces avail-
able in the United States, plus those parking spots made available by
companies and governmental units for free use by employees. The
computation does not include complimentary parking spaces provided
by businesses as an accommodation to customers. These would not be
taxed.
6. A severance tax on oil and a gathering tax on natural gas calcu-
lated to yield total revenues of $350 raillion a year so as to compensate
for the incentives extended to encourage exploration. Thus, as noted
earlier, the industry would be paying for its own incentives. The ex-
ploiter would pay for the incentive extended to the explorer. In the
long run, it would benefit him-even more directly than it benefits
the entire nation-since it is the discovered supplies that he is selling,
and since unless more domestic petroleum resources are discovered he
may not have anything at all to sell within a few years.
The total estimated revenues from the taxes herein contemplated
would appear to exceed-particularly in the early years-the ear-
marked annual expenditures f:rom the Trust Fund. This is somewhat
deliberate, as a hedge against possible miscalculations and the. appar-
ent likelihood of declining levels of revenue from certain of the
sources, and to provide a margin for flexibility in altering the pro-
posed taxation and expenditure schedules as further observation and
new information may dictate.
The foregoing outline no doubt can be improved by refinements,
moderations, enlargements and even substitutions. I make no claim, ob-
viously, that it represents a final or infallible judgment as to each of
its particulars. Some of my figures may be subject to successful chal-
lenge. They are merely the results of the best information available to
me at the present time, and I believe them to be basically and in large
part reliable.
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My purpose in offering this initiative is not to say that it should
necessarily be precisely this way in every detail, but rather to concep-
tualize what it is that I believe the Congress should and must be about
doing in the very near future. I invite critical analysis and suggestions
for improvement in the basic plan I've offered here.
Most of all, I invite my colleagues in the Congress to come to grips
with these hard problems now, to face these hard decisions which in
the interest of the national future should not be longer put off, and to
synthesize among us a Congressional plan of action worthy of the
world's greatest legislative body and of the nation it serves, worthy of
those who sent us here-and of their children.
An Energy Conservation and Development Trust Fund-
Dedicated to the following purposes :
Urban mass transit programs---------------------------- $2,000,000,000
Inter-city commuter systems_____________________________ 200,000, 000
To expand bus production_______________________________ 100,000,000
R. & D. program for coal conversion______________________ 1,000, 000, 000
R. & D. program for solar, nuclear, thermal-------------- 1, 000, 000, 000
Recovery methods for oil shale-------------------------- 200,000,000
Rehabilitation of stripped lands-------------------------- 100,000,000
Loans for insulation improvements----------------------- 500, 000, 000
To States, speed enforcement program-------------------- 100, 000, 000
Incentives for oil and gas exploration-------------------- 350,000,000
Unemployment compensation, training-Displaced workers- 350, 000, 000
With taxes from following sources :
4 cents per gallon on gasoline____________________________ 14, 000, 000, 000
Excise on new large automobiles------------------------- 1800, 000,000
Excise on large pleasure boats___________________________ 48,000,000
Electricity, large commercial, and independent users ------- 900, 000, 000
Parking lots-------------------------------------------- 490,000,000
Severance and gathering taxes, oil and gas--------------- 350, 000, 000
Total ------------------------------------------------ 16,588,000,000
l Estimated first year's yield based on present level of sales. These figures may decline
somewhat in response to energy shortage.
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ADDITIONAL VIEWS OF HON. JOHN C. CULVER
I am glad to support this bill as amended, but I think it important
for the Committee to set definite policy goals and to monitor their
achievement through stringent oversight of the Administrator's per-
formance in the annual authorization hearings provided for by Sec-
tion 304.
Among the goals that I consider important are those identified in
the Additional Views submitted by Representative Rosenthal, and I
join his expression of those views. There are three further points that
I believe the Administrator of the new ERDA must bear in mind.
First, it should be clear to him as it is to me that the authorizations
in Sections 103(6) and 108(a) to participate in cooperative projects
includes the pooling of information and efforts with foreign and inter-
national agencies. The energy crisis affects Europe and Japan far more
severely than it does us; we should seek to develop technologies that
can be of common use and assistance; and we should strive to avoid
duplication and overlap as well as gain the benefits of their efforts.
Second, it is. certainly essential that new and adequate emphasis be
placed on the development of clean, renewable energy sources such as
coal gasification, solar and geothermal energy, and nuclear fusion.
The annual ERDA report and authorization requests should break
down and Justify the relative funding emphasis placed on each of
these technologies in comparison with others.
Finally, the annual report should include in its account of R & D
progress the best available current estimate of the end commercial
costs of producing useable energy products by means of any given
technology under active consideration or promotion. Judgements
among priorities will have to be made and revised as we proceed, and
energy costs will have to be taken prominently into account. Among
other things, and despite the President's call for self-sufficiency, we
cannot hope to insulate our energy-dependent industries-steel, petro-
chemicals, and others-from competitive world energy costs. This
means that we cannot afford an R & D program that winds up isolat-
ing these essential industries from world markets.
The Administrator will bear important and difficult responsibilities,
and I believe he should be given as much policy guidance as possible
by this authorizing Committee.
JOHN CIILVER.
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