Summary: GAO discussed proposed legislation that would restructure the Department of Energy's (DOE) Uranium Enrichment Program as a government corporation. GAO noted that the proposed legislation: (1) would limit recovery of past uranium enrichment costs; (2) would establish a fund to pay for the costs of decommissioning three enriched uranium production facilities; (3) would provide for a voluntary utility ore purchase program; (4) would require the corporation to issue capital stock initially valued at $3 billion to the United States, and authorize it to issue bonds that would not be government obligations; (5) would require the corporation to seek licenses for enrichment facilities; (6) did not state the corporation's responsibility for facility environmental cleanup and maintenance; and (7) would exempt DOE from committing to future cleanup actions. GAO believes that: (1) although the proposed privatization of the enrichment program would allow for better operation as a business entity, the new corporation would still face serious challenges stemming from licensing problems, undefined environmental and decommissioning costs, and increasing competition; and (2) the proposed legislation should further consider the program's appropriate organizational structure, the appropriate amount of cost recovery, and DOE responsibility for helping the domestic uranium mining industry.
