Decommissioning Financial Assurance (30.35)

Introduction

Decommissioning financial assurance is the up-front proof — required when a radioactive material license is issued and maintained for its whole life — that a licensee can pay to clean up and release its site when operations end. Under 10 CFR 30.35, that proof is either a certification of financial assurance in a fixed dollar amount or a full decommissioning funding plan (DFP) with a site-specific cost estimate and an approved funding mechanism.

The purpose is straightforward public protection: decommissioning a facility that has used radioactive material — surveying it, remediating contamination, disposing of waste, and demonstrating the site meets the release criteria — costs money, sometimes a great deal. If a licensee goes bankrupt, closes abruptly, or simply never budgeted for cleanup, the cost can fall to the government and the public. Financial assurance requires licensees to set that money aside, verifiably, before it is needed.^{1, 7}

For most medical and academic licensees this is a license-management obligation rather than a day-to-day radiation-safety task, which is exactly why it is easy to get wrong: a stale cost estimate, an expired surety, or a missed three-year update can become a finding at the worst possible time. This guide explains who needs a DFP versus a certification, how much is required, what mechanisms are acceptable, and how the cost estimate works. DRPS supports facilities on these obligations through its radioactive material license support and radiation safety officer services across Florida, Maryland, Virginia, Washington DC, California, and Nevada.

Topic Explanation

What the rule requires

10 CFR 30.35 requires certain byproduct-material licensees to provide, and keep current, financial assurance for the eventual decommissioning of their facility. Which obligation applies depends on how much radioactive material the licensee is authorized to possess, measured against the quantities in Appendix B to 10 CFR Part 30.^{1, 3}

There are, in effect, three bands:

• Largest possessors — decommissioning funding plan (DFP). Licensees authorized to possess unsealed byproduct material (half-life greater than 120 days) in quantities exceeding roughly 10⁵ times the applicable Appendix B values, or very large sealed-source inventories, must submit a DFP with a site-specific cost estimate and a funding mechanism.¹
• Intermediate possessors — certification. Licensees with smaller but still significant quantities may instead submit a certification of financial assurance in one of three prescribed dollar amounts.¹
• Smallest possessors — none. Below the lowest threshold, no decommissioning financial assurance is required, though recordkeeping and timeliness obligations still apply.

Parallel requirements exist for other materials licensees under 10 CFR 40.36 (source material), 70.25 (special nuclear material), and 72.30 (independent spent fuel storage). The NRC's consolidated guidance for all of them is NUREG-1757, Volume 3.⁷

Why it exists: the Decommissioning Planning Rule

The financial-assurance framework was significantly strengthened by the NRC's Decommissioning Planning Rule, which took effect in 2012. That rulemaking responded to cases where residual contamination — especially subsurface or hard-to-detect contamination — drove decommissioning costs far above what licensees had set aside. It tightened cost-estimate expectations, required licensees to conduct surveys to detect residual radioactivity during operations under 10 CFR 20.1501, and required a DFP to be submitted within a year if contamination that could prevent meeting the unrestricted-release criteria is found.^{5, 6, 7}

The through-line is that financial assurance is not a one-time form. It is a living estimate that must track the real, current cost of cleaning up the site as it actually is.

Key Technical Principles

DFP versus certification, and the Appendix B ratio

Whether a licensee falls above the DFP threshold is judged against the Appendix B quantities. When a license authorizes multiple radionuclides, the possessed quantities are combined using a sum-of-ratios approach:

where $Q_i$ is the authorized quantity of radionuclide $i$ and $A_{B,i}$ is its Appendix B quantity. The value of $R$ places the licensee in a band: broadly, $R$ above about $10^5$ (unsealed) triggers a DFP, while an $R$ in the intermediate range places the licensee on the certification path with a prescribed amount.^{1, 3}

The table summarizes the obligation by possession band and the mechanism each typically uses.

The fixed certification amounts in 10 CFR 30.35(d) are $1,125,000, $225,000, and $113,000, assigned by possession tier.¹ A DFP licensee does not use these fixed numbers; it must assure the full amount of its own cost estimate, which may be larger.

The decommissioning cost estimate

A DFP's heart is the cost estimate. A defensible estimate accounts for the actual scope of work, including:

• planning, surveys, and project management;
• decontamination or dismantling of contaminated equipment, rooms, and building surfaces;
• packaging, transport, and disposal of radioactive waste (often the dominant cost);
• the final-status survey needed to demonstrate the site meets release criteria;
• and a contingency allowance for the uncertainties inherent in cleanup.

Because waste-disposal and labor costs rise over time, the estimate must be kept current. A simple inflation adjustment of a prior estimate uses:

where $r$ is the annual escalation rate and $n$ is the number of years. For example, a prior estimate of 400,000 dollars escalated at $r=0.03$ (3% per year) for $n=3$ years grows by the factor $(1.03{)}^3\approx 1.0927$:

That is roughly 437,000 dollars. Inflation adjustment alone is not sufficient if the facility, inventory, waste-disposal pathway, or site conditions have changed — those require re-estimating, not just escalating — but it illustrates why a three-year-old number is rarely still correct.^{1, 7}

Acceptable funding mechanisms

10 CFR 30.35(f) recognizes several mechanisms, and Regulatory Guide 3.66 gives the standard formats and wording.^{1, 8} In broad terms:

• Prepayment: depositing the full amount into a segregated account controlled by an independent trustee — a trust, escrow, government fund, certificate of deposit, or deposit of government securities.
• Surety, insurance, or guarantee: a surety bond, letter of credit, line of credit, insurance policy, parent-company guarantee, or self-guarantee. Guarantees require the guarantor to pass financial tests specified in the Part 30 appendices.
• External sinking fund plus surety: periodic deposits building toward the full amount, backed by a surety that covers any shortfall.
• Statement of intent: available only to federal, state, or local government licensees, which can commit to obtaining funds when needed.

Whatever the mechanism, it must be payable to an independent party or the regulator, must cover the full assured amount, and must be kept continuously in force.

Clinical Impact

What this means for a medical facility

Most hospitals, imaging centers, and clinics with a standard nuclear medicine license possess quantities below the DFP threshold and either certify or fall below the lowest threshold entirely. The obligation becomes substantial for facilities with large sealed sources or high-activity inventories:

• High-dose-rate (HDR) brachytherapy afterloaders and gamma stereotactic radiosurgery units with large Co-60 or Ir-192 sources;
• blood and research irradiators (self-contained Cs-137 or Co-60 devices);
• large sealed-source or broad-scope research licenses;
• PET radiopharmacies and cyclotron operations with significant inventories.

For these, decommissioning cost — dominated by source removal, device disposal, and any contamination remediation — can be high, and the financial-assurance amount must reflect it. A facility that acquires such a device, or expands its license, should re-examine whether it has crossed the DFP threshold or needs a larger certification. This is the same license-lifecycle thinking behind radioactive material license renewal and sealed source inventory accountability.

Where programs get into trouble

Common failure modes are administrative, not technical:

• an expired or lapsed surety or letter of credit that was never renewed;
• a cost estimate that has not been updated in more than three years;
• a license amendment (new source, higher possession limit) that pushed the licensee into a higher band without a corresponding financial-assurance update;
• a guarantee relying on a parent company that no longer passes the financial test;
• or discovery, during 20.1501 surveys, of residual contamination that should have triggered a DFP.

Each of these is routinely identifiable in a license self-audit before it becomes an inspection finding.

Practical Optimization Tips

1. Know your band and keep proof of it

• Calculate your Appendix B ratio from your authorized possession limits and document which 30.35 obligation applies.
• Re-run that calculation whenever you amend the license or add a significant source.

2. Keep the cost estimate alive

• For DFP licensees, update the cost estimate and resubmit at intervals not exceeding three years, adjusting for inflation and for any real change in facility, inventory, waste cost, or site conditions.¹
• Keep the supporting basis (waste volumes, disposal rates, labor) so the estimate is defensible, not just a number.

3. Maintain the mechanism

• Track expiration and renewal dates for sureties, letters of credit, and insurance as diligently as any other compliance deadline.
• For parent-company or self-guarantees, confirm the guarantor still passes the required financial tests each year.

4. Integrate with surveys and timeliness

• Use operational surveys under 10 CFR 20.1501 to detect residual contamination early; a finding can require a DFP within a year.^{5, 7}
• Track the 10 CFR 30.36 timeliness clock when any part of the facility stops using licensed material, because decommissioning deadlines and financial assurance are two halves of the same obligation.²

5. Fold it into the RSO calendar and audits

• Put financial-assurance review into the annual radiation-safety program audit and the RSO's recurring task list so it is never an afterthought. See preparing for an NRC inspection.

Common pitfalls to avoid

• Treating financial assurance as a one-time filing. It must be maintained and updated for the life of the license.
• Letting the cost estimate age past three years.¹
• Forgetting that a license amendment can change the required amount.
• Assuming a guarantee is permanent. Guarantors must keep passing financial tests.
• Ignoring subsurface or hidden contamination. The Decommissioning Planning Rule made early detection and planning explicit obligations.^{5, 7}

Regulatory Considerations

Financial assurance is a federal (NRC) or Agreement State requirement tied to the radioactive material license, and it interlocks with the rules on decommissioning, site release, and timeliness. The core framework:

• 10 CFR 30.35 — Financial assurance and recordkeeping for decommissioning: who must assure, how much, acceptable mechanisms, and the three-year update cycle.¹
• 10 CFR 30.36 — Expiration and termination of licenses and decommissioning of sites and separate buildings or outdoor areas: the timeliness rule governing when decommissioning must begin and be completed.²
• 10 CFR Part 30, Appendix B — the quantities against which possession is measured to determine the obligation band.³
• 10 CFR 20.1402 and 20.1501 — the unrestricted-use dose criterion (25 mrem/yr above background) the site must meet at release, and the operational surveys that can trigger a DFP.^{4, 5}
• NUREG-1757, Volume 3 — the NRC's consolidated decommissioning guidance on financial assurance, recordkeeping, and timeliness, and Regulatory Guide 3.66 for standard financial-assurance instrument formats.^{7, 8}

Agreement States administer equivalent programs. Of the states DRPS serves, Florida, Maryland, Virginia, California, Nevada, Pennsylvania, New York, and New Jersey are NRC Agreement States that implement their own versions of these financial-assurance rules, while Washington, DC and Delaware are regulated directly by the NRC. A licensee must confirm which authority issues its license and which state-specific amounts, mechanisms, and deadlines apply. The eventual site release is governed by the same release criteria and, for larger sites, the final-status survey process described in MARSSIM and decommissioning and license termination.

Frequently Asked Questions (FAQs)

What is decommissioning financial assurance?

Decommissioning financial assurance is proof, required when a license is issued and maintained throughout its life, that a radioactive material licensee has set aside enough money to safely decommission its facility and release the site when operations end. Under 10 CFR 30.35, it takes the form of either a certification of financial assurance in a prescribed dollar amount or a full decommissioning funding plan backed by an approved funding mechanism, so that cleanup does not fall to the public if a licensee cannot pay.

Who has to submit a decommissioning funding plan?

A decommissioning funding plan is required for licensees that possess the largest quantities of radioactive material, generally unsealed byproduct material with a half-life greater than 120 days in quantities exceeding about 100,000 times the applicable Appendix B values, or very large sealed-source inventories. Licensees with smaller but still significant quantities may instead submit a certification of financial assurance in one of three fixed dollar amounts, and the smallest possessors need no financial assurance at all.

How much financial assurance is required?

For licensees on the certification path, 10 CFR 30.35(d) prescribes fixed amounts of $1,125,000, $225,000, or $113,000, scaled to the possession tier. Licensees required to file a decommissioning funding plan must instead provide a site-specific cost estimate of the actual expected decommissioning cost, which can be higher or lower than the certification amounts, plus a funding mechanism covering that full estimate.

What funding mechanisms are acceptable?

10 CFR 30.35(f) allows prepayment into a segregated account such as a trust or escrow; a surety, insurance, or guarantee method such as a surety bond, letter of credit, or parent-company or self-guarantee that meets the financial tests in the Part 30 appendices; an external sinking fund paired with a surety; or, for federal, state, or local government licensees, a statement of intent. The mechanism must be payable to an independent trustee or to the regulator and kept current for the full assured amount.

How often must a decommissioning funding plan be updated?

Under 10 CFR 30.35(e), the decommissioning funding plan must contain a detailed cost estimate and must be resubmitted with adjustments at intervals not to exceed three years, and whenever a change in authorized activities or possession would materially affect the cost or the amount of financial assurance. The cost estimate must be updated for inflation and for any changes in the facility, waste disposal costs, or site conditions.

How does this relate to the actual decommissioning of a medical facility?

Financial assurance guarantees the funds; the timeliness rule and the decommissioning process govern the work. When a licensee stops using a part of its facility, 10 CFR 30.36 sets deadlines to notify the regulator and complete decommissioning, and the site must be surveyed and remediated to meet the unrestricted-use dose criterion before the license is terminated. Financial assurance is what makes sure the money to do all of that exists in advance.

Key Takeaways

• Financial assurance is proof of funds for cleanup, required at licensing and maintained for the life of the license under 10 CFR 30.35.¹
• The obligation scales with possession. The largest possessors file a decommissioning funding plan; intermediate possessors certify; the smallest need nothing.^{1, 3}
• Certification amounts are fixed: $1,125,000, $225,000, or $113,000 by tier; DFP licensees assure their own site-specific cost estimate.¹
• Mechanisms must be real and current: prepayment, surety/insurance/guarantee, sinking fund plus surety, or a government statement of intent.^{1, 8}
• Cost estimates must be updated at least every three years and whenever the facility or inventory changes.¹
• The Decommissioning Planning Rule made early contamination detection and planning explicit, linking operational surveys to financial assurance.^{5, 7}
• Agreement States run their own versions, so confirm the issuing authority and its specific requirements.

Conclusion

Decommissioning financial assurance is a quiet obligation with loud consequences if neglected. The rule is simple in principle — set aside enough money, verifiably, to clean up and release your site — but it demands ongoing attention: the right obligation band, a current cost estimate, a live funding mechanism, and coordination with the timeliness and site-release rules.

For a medical or research licensee, the practical work is mostly administrative diligence: know your Appendix B band, keep the certification or DFP current, track every surety and guarantee expiration, re-estimate at least every three years, and revisit the whole picture whenever the license changes. A facility that treats financial assurance as a living part of its license-management program — not a form filed once and forgotten — will keep it defensible through every inspection and, ultimately, through decommissioning itself.

How DRPS Can Help

Diagnostic Radiation Physics Services helps imaging, nuclear medicine, and research facilities manage the license-lifecycle obligations that surround radioactive material, including decommissioning financial assurance. That support can include determining the correct 10 CFR 30.35 obligation band, reviewing or preparing decommissioning cost estimates and funding-plan documentation, coordinating certification and mechanism updates, aligning financial assurance with timeliness and site-release requirements, and folding these checks into the annual radiation-safety audit, as part of radioactive material license support and RSO program guidance.

DRPS supports facilities across our service locations, including Florida, Maryland, Virginia, Washington DC, California, Nevada, New York, Pennsylvania, New Jersey, and Delaware, through medical physics consulting. The goal is a financial-assurance posture that is accurate, current, and defensible — long before anyone needs the money.

Related Resources

• Decommissioning and license termination
• MARSSIM final status survey
• Radioactive material license renewal
• NRC license guide
• Sealed source inventory accountability
• Preparing for an NRC inspection
• Radioactive material license support
• Radiation Safety Officer consulting

References

1. U.S. Nuclear Regulatory Commission. 10 CFR 30.35: Financial assurance and recordkeeping for decommissioning. ecfr.gov
2. U.S. Nuclear Regulatory Commission. 10 CFR 30.36: Expiration and termination of licenses and decommissioning of sites and separate buildings or outdoor areas. ecfr.gov
3. U.S. Nuclear Regulatory Commission. 10 CFR Part 30, Appendix B: Quantities of Licensed Material Requiring Labeling. ecfr.gov
4. U.S. Nuclear Regulatory Commission. 10 CFR 20.1402: Radiological criteria for unrestricted use. ecfr.gov
5. U.S. Nuclear Regulatory Commission. 10 CFR 20.1501: General (surveys and monitoring). ecfr.gov
6. U.S. Nuclear Regulatory Commission. Decommissioning Planning; Final Rule. 76 FR 35512, June 17, 2011 (effective 2012). govinfo.gov
7. U.S. Nuclear Regulatory Commission. NUREG-1757, Volume 3, Revision 1: Consolidated Decommissioning Guidance — Financial Assurance, Recordkeeping, and Timeliness. 2012. nrc.gov
8. U.S. Nuclear Regulatory Commission. Regulatory Guide 3.66: Standard Format and Content of Financial Assurance Mechanisms Required for Decommissioning Under 10 CFR Parts 30, 40, 70, and 72. nrc.gov
9. U.S. Nuclear Regulatory Commission. 10 CFR Part 30, Appendices A, C, D, and E: Criteria relating to financial tests, self-guarantee, and surety/insurance. ecfr.gov
10. U.S. Nuclear Regulatory Commission. NUREG-1556, Volume 9, Revision 3: Program-Specific Guidance About Medical Use Licenses. nrc.gov