Panel cuts more than 20 percent

WASHINGTON -- A Senate panel on Tuesday chopped more than 20 percent from the Department of Energy's 2009 budget for a nuclear waste repository at Yucca Mountain.

The energy and water subcommittee's action signals months of uncertainty ahead as to whether DOE will have enough money to manage its newly submitted license application for the Nevada site if Congress carries out the cut.

The Senate subcommittee approved a $386.4 million budget for the fiscal year that starts in October for the Yucca project, 100 miles northwest of Las Vegas. That is the same amount that Congress allocated last year, but $108.3 million less than DOE had requested for 2009.

Most of the additional funding was budgeted to pay lawyers, engineers, managers and scientists preparing to defend a repository application in June to the Nuclear Regulatory Commission.

DOE spokesman Allen Benson said the department will not comment until Congress completes work on the Yucca Mountain budget as part of a $33.2 billion spending bill for the Energy Department, the U.S. Army Corps of Engineers and the Bureau of Reclamation.

Sen. Harry Reid, D-Nev., a Yucca critic who has exercised power as Senate majority leader to slow the project, said the Senate budget cut unveiled Tuesday will set it back.

"It was no simple task to cut $109 million -- 22 percent -- of the $495 million budget requested by the President, but it will surely cripple the progress the Energy Department wants to make," Reid said in a statement.

A corresponding bill in the House fully funds Yucca Mountain at DOE's request of $494.7 million. The House and Senate would need to settle on a final amount, but leaders have not said when the bill will be finished.

Congress last year forced cuts of more than $100 million in the Yucca program, prompting several hundred layoffs and a DOE reorganization to meet a June goal to send a repository construction plan to the NRC.

The new Senate bill granted the agency's request for $37.3 million to carry out Yucca Mountain license studies in the coming year, according to Sen. Byron Dorgan, D-N.D., the subcommittee chairman.

"They will have sufficient funds," Dorgan said.

Meanwhile on Tuesday, Nevada lawmakers turned up their criticism of a Yucca Mountain legal services contract between the Department of Energy and Morgan Lewis & Bockius LLP.

The lawmakers renewed a demand that Morgan Lewis be taken off the project after the Justice Department recently raised new questions about the firm's conflicts of interest.

At the same time Morgan Lewis is working a $47.7 million contract to handle repository licensing, it represents nuclear utilities that are suing the Department of Energy for missing deadlines on the project.

The Justice Department has challenged whether DOE had the authority to seek a conflict-of-interest waiver to allow Morgan Lewis to be hired for the Yucca job after the firm said it was taking steps to keep the cases separated.

"The Justice Department's opinion is clear and unequivocal," Nevada's five members of Congress said in a letter to Energy Secretary Samuel Bodman. "The Department of Energy had no authority to waive Morgan Lewis' conflicts of interest ..."

DOE responded in a statement that the department was within its rights to grant the waiver, which it said complied with "all applicable rules and regulations."

Contact Stephens Washington Bureau Chief Steve Tetreault at stetreault@stephensmedia.com or 202-783-1760.