High-stakes radioactive roulette.

• Author: Gordon, Dianna
• Position: Waste disposal funds

Illinois and Kentucky have sued the federal Department of Energy for release of about $3 million it holds in escrow. That money is desperately needed to build new low-level radioactive waste disposal sites.

With $22 million in federal rebates from the U.S. Department of Energy (DOE) at stake, states are scrutinizing the progress of a lawsuit filed by Kentucky and Illinois against federal Energy Secretary Hazel O'Leary.

Kentucky and Illinois, which have formed the Central Midwest Interstate Low-Level Radioactive Waste Compact, contend the DOE owes them more than $3 million of the $22 million in waste disposal surcharges being held in escrow by the federal department.

The story begins in 1980 with federal adoption of the Low-Level Radioactive Waste Policy Act, which declared a state responsible for disposal of the material produced by such businesses as hospitals, research labs and nuclear facilities within its borders. Roughly 1.4 million cubic feet of dirty gloves, contaminated equipment and other mildly radioactive waste is generated each year in the United States.

In 1985, Congress amended the act and allowed states or regions operating waste disposal facilities to impose on outside states, compacts and generators a series of disposal surcharges on material. One-fourth of the surcharge amount was placed in a DOE escrow account. As states met federal requirements for low-level radioactive waste disposal, money was released to them from that account and was specifically earmarked for use in developing new disposal sites.

The Central Midwest Compact received DOE rebates in July 1986, January 1988 and January 1990. It did not get the final January 1993 payment of one-quarter of the escrow account that was to be released if the compact was able to provide for disposal of all low-level radioactive waste generated within the region.

Stating that a contract to use the Barnwell disposal facility in South Carolina met that federal requirement, Central Midwest went to district court in June to demand release of the funds by the DOE.

However, a DOE notice published in the Sept. 30, 1992, Federal Register said if a state failed to meet the disposal requirement, the rebate money would go to the low-level radioactive waste generators that paid disposal surcharges.

The Central Midwest rebate was due Jan. 31. In March, the DOE advised the compact it was analyzing the comments contained in more than 30 letters submitted in response to the Federal Register...