Statement of Administration Policy: S. 2097 - Uranium Revitalization, Tailings Reclamation and Enrichment Act of 1987

(Revised - LA 3/24/88)

(Senate)
(Senator Johnston (D) Louisiana)

The Administration recognizes the importance of achieving S. 2097's general goal of establishing a successful uranium enrichment industry, but due to its failure to transfer the uranium enrichment function to the private sector and to provide adequately for U.S. defense needs, the Administration strongly opposes the bill.

To achieve the necessary effectiveness and flexibility in operations, contracting, pricing, and financial decision-making, the Department of Energy's uranium enrichment enterprise must be operated as one or more businesses in the private sector, rather than as a governmental organization. In any case, it is important to preserve adequate stocks of uranium to meet national defense needs and to ensure that defense needs for enriched uranium are met at costs no greater than those charged to commercial entities.

The President's senior advisers would recommend that he veto S. 2097 in any form if it is presented to him containing restrictions that would discriminate against foreign uranium, because such restrictions:

— are contrary to the U.S.-Canada Free Trade Agreement;

— violate U.S. obligations under the General Agreement on Tariffs and Trade;

— hinder U.S. access to important energy resources; and

— are inconsistent with the fundamental U.S. policy of promoting free trade.