Nuclear Metals, Inc. v. Low-Level Radioactive Waste Management Bd., LOW-LEVEL

• Decision Date: 17 October 1995
• Docket Number: LOW-LEVEL
• Parties: , 41 ERC 2093 NUCLEAR METALS, INC. v.RADIOACTIVE WASTE MANAGEMENT BOARD.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

Page 563

656 N.E.2d 563

421 Mass. 196, 41 ERC 2093

NUCLEAR METALS, INC. v. LOW-LEVEL RADIOACTIVE WASTE MANAGEMENT BOARD.

Supreme Judicial Court of Massachusetts Suffolk.

Argued Jan. 9, 1995.

Decided Oct. 17, 1995.

Philip M. Cronin (Robert A. McCall with him), Boston, for plaintiff.

Peter Sacks, Assistant Attorney General (J. Raymond Miyares with him), for defendant.

Before LIACOS, C.J., and WILKINS, ABRAMS, LYNCH, O'CONNOR and GREANEY, JJ.

GREANEY, Justice.

Nuclear Metals, Inc. (plaintiff), filed a complaint in the Superior Court seeking, in count I, a determination that an assessment imposed on it by the Low-Level Radioactive Waste Management Board (board), acting pursuant to G.L. c. 111H, §§ 4A and 4B (1994 ed.), and corresponding regulations, 845 Code Mass.Regs. § 4.00 (1992), ¹ was unlawful. Count II of the complaint presented an appeal from a decision of an administrative magistrate, adopted with minor revisions by the board, concluding that the amount of the assessment charged to the plaintiff was proper.

The parties submitted the case on a statement of agreed facts and the record of the administrative proceedings. A judge in the Superior Court ordered entry of judgment for the board on the claim contesting the validity of the assessment. He vacated the decision of the board on the plaintiff's administrative challenge to the computation of the assessment on the ground that the board lacked jurisdiction to hear the appeal, and he ordered that the claim in count II of the complaint be dismissed. Both parties appealed from the judgment, and we granted the board's application for direct appellate review. We affirm that part of the judgment which declares the assessment to be a valid fee rather than an unconstitutional charge. We vacate that part of the judgment dismissing the plaintiff's appeal from the administrative decision of the board, and remand the case to the Superior Court so that it may be returned to the board for administrative consideration of the plaintiff's claim respecting the amount of the assessment charged.

1. Facts. The material facts are straightforward and undisputed. The plaintiff is a manufacturer licensed by the United States Nuclear Regulatory Commission to receive, possess, use, transfer, or acquire radioactive materials. The plaintiff, which employs approximately 200 persons in the Commonwealth, uses depleted uranium in the manufacture of metal products for a range of applications, including kinetic penetrators used for armor piercing ammunition by the United States armed forces, and radiation-shielding components for medical, pharmaceutical, and industrial uses. As a byproduct of its manufacturing processes, the plaintiff produces low-level radioactive waste. ² Based on data collected by the board, the plaintiff was among the top four generators of low-level radioactive waste in the Commonwealth during the years of 1990 and 1991. The assessment at issue totals $102,103.76.

2. Statutory basis for the assessment. The Low-Level Radioactive Waste Policy Amendments Act of 1985, 42 U.S.C. §§ 2021a et seq. (1988) (Federal act), states as Federal policy that "[e]ach State shall be responsible for providing, either by itself or in cooperation with other States, for the disposal of ... low-level radioactive waste generated within the State...." 42 U.S.C. § 2021c(a)(1)(A). The goal of the Federal act is to decrease reliance on the few existing disposal sites, located in the States of Washington, South Carolina, and Nevada, ³ by encouraging States to enter into cooperative regional compacts and develop disposal sites for thelow-level radioactive waste generated within each region. See 42 U.S.C. § 2021c, 2021e.

In New York v. United States, 505 U.S. 144, 112 S.Ct. 2408, 120 L.Ed.2d 120 (1992), the United States Supreme Court interpreted the Federal act as providing to the States lacking in-State or regional disposal sites a series of strong incentives to comply with Federal policy concerning the disposal of low-level radioactive waste generated within their borders. Id. at 170, 112 S.Ct. at 2425. The Court explained that, in form, the Federal act is an "intricate" compromise among the States with, and the States without, disposal sites. Id. at 151, 112 S.Ct. at 2415. In effect, the Federal act authorizes burdens on interstate commerce that most likely would be unconstitutional absent express congressional authorization. See Philadelphia v. New Jersey, 437 U.S. 617, 98 S.Ct. 2531, 57 L.Ed.2d 475 (1978) (law closing New Jersey's borders to waste generated outside territorial limits unconstitutional burden on interstate commerce). States with disposal sites are granted the right to place escalating surcharges, beginning in 1986-1987, on disposal in their existing facilities, and, as of 1996, to deny access to the existing disposal sites to waste generators located in any State that has not met specific "milestones" set out in the Federal act. Those milestones mark progress toward the siting and licensing of an in-State or a regional facility for the disposal of a State's low-level radioactive waste. Id. at 151-153, 112 S.Ct. at 2415-2416. In the Court's words, "any burden caused by a State's refusal to regulate [in compliance with the Federal act] will fall on those [within the State's borders] who generate waste and find no outlet for its disposal." Id. at 174, 112 S.Ct. at 2427.

General Laws c. 111H (State act), inserted by St.1987, c. 549, establishing the board and delineating its responsibilities, is the Commonwealth's response to the Federal act. See Opinion of the Justices, 397 Mass. 1201, 493 N.E.2d 859 (1986). Under the State act, the board is charged with preparing and implementing a management plan to provide for the safe and efficient management of low-level radioactive waste produced in the Commonwealth. G.L. c. 111H, §§ 11, 12. ⁴ In conjunction with the Departments of Environmental Protection and Public Health, the State act charges the board with the selection of a site for the disposal of low-level radioactive waste generated in the Commonwealth. See G.L. c. 111H, §§ 17, 33. The board has the responsibility for choosing among an in-State facility open only to generators of waste in the Commonwealth, a small regional disposal facility, or a large regional disposal facility serving waste generators in New England and offering disposal services to generators outside the region. See 345 Code Mass.Regs. § 1.74 (1994). See also St.1987, c. 549, § 6. In the event that the milestones in the Federal act are not met, and access to existing disposal sites in other States is denied to waste generators in the Commonwealth, the board is required by statute to develop interim or emergency plans for the temporary storage of low-level radioactive waste. See G.L. c. 111H, § 12(b )(10).

3. The assessment. Pursuant to G.L. c. 111H, § 4A, the board must "annually assess each person licensed or registered to receive, possess, use, transfer or acquire radioactive materials in the Commonwealth, amounts sufficient to defray the costs annually incurred by the board" to implement its plan for managing the disposal of low-level radioactive waste generated in the Commonwealth. The total assessment is capped by statute at $500,000. That amount is to be reduced by any funds appropriated or obtained from other sources for implementing the management plan. See G.L. c. 111H, § 4A. ⁵ The board is directed to apportion the total assessment among licensees and registrants, ⁶ "based on the volume and classification of radioactivity of waste produced by each licensee and registrant which is shipped for disposal off site or stored for later disposal; provided, however, that the board shall make a minimum assessment on all licensees and registrants." Id. For purposes of apportioning the fiscal year 1992 assessment, the board first assessed a "minimum" flat fee of $75 to all licensees and registrants. The remainder of the total assessment was charged proportionally to licensees and registrants based on waste produced and shipped during 1990 and 1991. Excluded from the assessment calculation was data on waste produced during 1990 and 1991 and stored on-site for later disposal.

4. Validity of the assessment. The plaintiff challenges the validity of the assessment as a lawful fee. The plaintiff further argues that, if the assessment is viewed as a tax, it fails to pass constitutional muster. We agree with the judge, however, that the plaintiff has failed to satisfy its burden of proving that the assessment is not a lawful fee. See Southview Coop. Hous. Corp. v. Rent Control Bd. of Cambridge, 396 Mass. 395, 403, 486 N.E.2d 700 (1985). See also Bertone v. Department of Pub. Utils., 411 Mass. 536, 549 n. 12, 583 N.E.2d 829 (1992).

"[T]he nature of a monetary exaction 'must be determined by its operation rather than its specially descriptive phrase.' " Emerson College v. Boston, 391 Mass. 415, 424, 462 N.E.2d 1098 (1984), quoting Thomson Elec. Welding Co. v. Commonwealth, 275 Mass. 426, 429, 176 N.E. 203 (1931). ⁷ Fees generally fall into one of two categories. A fee may be categorized either as a user fee, charged by the proprietor of a particular instrumentality for its use, or as a regulatory fee, founded on the State's police power to regulate a particular activity or business. Emerson College, supra at 424, 462 N.E.2d 1098. As Justice Breyer (then Judge Breyer) recently noted, "The classic 'regulatory fee' is imposed by an agency upon those subject to its regulation.... It may serve regulatory purposes directly by, for example, deliberately discouraging particular conduct by making it more expensive.... Or, it may serve such purposes indirectly by, for example, raising money placed in a special fund to help defray the agency's regulation-related expenses." (Citations omitted.) San Juan Cellular Tel. Co. v. Public Serv. Comm'n of P.R., 967 F.2d 683, 685 (1st Cir.1992).

In the Emerson College c...