The Paducah Sun
The Paducah Sun
Paducah, Kentucky
Friday, August 10, 2001

PACE negotiations discontinue for now
PACE President David Fuller accuses USEC of using Paducah's situation as a bargaining token for Russian uranium issues in Washington.

By Joe Walker jwalker@paducahsun.com--270.575.8650

With contract negotiations broken off, union officials have accused the U.S. Enrichment Corp. of using labor tactics to try to force federal action aiding the company's purchase of Russian uranium.

The company says the Russian issue should have been resolved before contract talks began and it has tried hard to appease the major union at the Paducah Gaseous Diffusion Plant.

USEC wants a proposed five-year contract with the union to expire after a year if goals regarding the uranium are not met. The objectives heavily depend on whether the Bush administration allows USEC to remain sole agent for the uranium and get lower prices.

Opposing the contract language and considering wage-benefit provisions substandard, the union voted overwhelmingly against the offer Aug. 2.

When talks resumed Wednesday, the union offered to renegotiate wages and benefits after a year if the Russian deal dictated, said David Fuller, president of Paper, Allied-Industrial, Chemical and Energy Workers Local 5-550.

"They had absolutely no interest in that," he said of USEC officials. "Based on that, in my judgment, they're wanting to foment a crisis at Paducah in hopes of leveraging a decision in Washington. I think that's short-sighted, ill-advised and if I were a legislator from this area, I'd take exception to it."

USEC spokeswoman Elizabeth Stuckle said the firm reached an agreement with Russia in May 2000 for better prices, but federal approval has not yet come.

"USEC has done everything in its power to try and expedite approval of the Russian deal," she said. "We have sought to obtain the support of business leaders, labor leaders and politicians to expedite approval of this deal that is so vitally important to the Paducah community.

"It was never USEC's intention to see this matter delayed to the point where it of necessity becomes an issue in our relationship with our bargaining unit employees."

The union represents about 700 of 1,500 workers at the plant, which enriches uranium for use in nuclear fuel. Fuller said members have no plans to strike, but could do so with a day's notice to the company. Their old contract expired July 31.

No new talks were set after bargainers left the table about 10 p.m. Wednesday, ending about 12 hours of meetings and deliberations. Fuller said there was some discussion about resuming bargaining next week, but nothing was finalized.

However, Stuckle said discussions were expected to resume the week of Aug. 20 because a union negotiator is unavailable next week.

USEC says that for a new contract to last longer than a year, it must accomplish three goals: remain sole agent for buying $8 billion in enriched uranium taken from dismantled Russian nuclear warheads; obtain a revised Russian contract for better prices; and get federal approval to buy commercial uranium from Russia.

USEC Senior Vice President Philip Sewell said earlier that Russian uranium is priced below the plant's enrichment costs. The goals are essential for USEC to control the flow of uranium into the United States, hold down expenses by "blending" the costs of Russian and Paducah material, and thus help preserve the plant, he said.

Some nuclear industry experts say having a second agent for the Russian uranium would spur competition and lower prices for U.S. nuclear plants that buy material from USEC.

The Bush administration is reviewing the matter as part of a broader look at the U.S. role in nuclear energy. USEC wants decisions before Jan. 1, when its contract with Russia expires.

The energy workers union has tried and failed to get USEC to promise to run the plant at specified production levels in return for support of the Russian deal, Fuller said.

"Without those enforceable guarantees and commitments, we will assume that a letter and a handshake means exactly the same thing as it did for Portsmouth," he said.

USEC closed its plant near Portsmouth, Ohio, in June, leaving Paducah as the only facility in the nation that enriches uranium.

But Stuckle painted a different picture. When it became apparent the Russian deal would not be approved before contract talks began, USEC tried to get the union to agree to a short contract extension to provide time for approval, she said.

"It was USEC's position that if the previous contract were extended, any increased benefits that would be finally negotiated would be retroactive to July 31," she said.

Stuckle said USEC has offered in writing to include contract language guaranteeing minimum plant production "as long as the Russian deal is in force or until a new technology enrichment plant is in operation several years from now."

She said USEC still wants "an amicable way" to resolve the contract issue pending a Russian decision, and is acting in the best interests of the community and all plant employees.