From The Daily News, Raleigh, N.C.

Tuesday, December 2, 1997

Panel cuts off N.C. money for nuke dump

BY ESTES THOMPSON -- ASSOCIATED PRESS

RALEIGH -- The Southeast Compact Commission will not give North Carolina any more money to develop a low-level radioactive waste dump until the state resolves a $7 million funding shortfall expected in 1999.

The decision issued Monday marks the second time the commission has cut off money to North Carolina because the state didn't have an acceptable financing plan, said Kathryn Haynes, executive director of the commission.

The first cutoff came in June 1996 and the state stopped the project until the compact commission reauthorized funding in October 1996. The current project, called a Licensing Work Plan, resumed in January and grew out of negotiations to get the commission to begin funding again.

"This has really been going on for two years," Haynes said. "They're saying, `why don't you give us the rest of your money and then we'll figure this out.' In the commission's viewpoint, that doesn't make sense."

But Walter Sturgeon, director of the state agency that's developing the dump, said the site in Wake County near a nuclear power plant "is looking better all the time and we feel it's unfortunate the compact has decided to stop funding the process at this point."

North Carolina was asked 10 years ago by the commission, which was created by Congress, to host a dump. Since then, more than $100 million has been spent as work moved haltingly toward getting a license from another state agency.

The target date for opening a dump is 2001 and the estimated construction cost is $75 million.

The commission threatened this cutoff last month at an August meeting. The commission began writing to Gov. Jim Hunt about the financing problems in January 1996, Haynes said.

But state officials had said the commission was rushing and that a study originally due to be completed this month may have shown no shortfall would exist.

In a letter to the state Low-Level Radioactive Waste Management Authority, commission Chairman Richard Hodes said spending is on hold effective Nov. 30. That means the state won't get the $600,000 a month it had been receiving.

Hodes' letter also said the state was obliged to keep funding the project.

"The commission continues to believe that it is the legal responsibility of North Carolina to fund site development activities as a part of its obligation as a host state," Hodes said.

"Until an integrated funding plan can be mutually agreed upon by all parties, the commission expects the authority to seek and expend state funds to enable continued site development activities without interruption and to keep the project on schedule."

The hang up occurred when electric utilities, which would be the largest users of the repository, offered to lend the state $7 million. Gov. Jim Hunt said he couldn't obligate the state to a loan that it didn't have funds to repay.

Warren Corgan, chairman of the authority, asked the utilities last week to make the loan a gift, but they refused.