WASHINGTON -- South Carolina and other states sued the Nuclear Regulatory Commission on Friday, accusing the agency of breaking the law by failing to act on an application for construction of a nuclear waste dump 100 miles outside Las Vegas.

President George W. Bush's administration submitted the application in 2008 to send the nation's spent nuclear fuel to Nevada's Yucca Mountain. But the Obama administration has said it will not consider the site because of concerns about contamination.

The commission is required under the law to issue a final decision within three years of an application, with the possibility of extending the deadline by one year, but the commission has taken no action.

South Carolina, Aiken County and Washington state, which are temporarily storing their waste, are among those that sued to force the commission to rule on the application.

They petitioned the U.S. Court of Appeals in Washington in an effort to restart the effort.

S.C. Attorney General Alan Wilson is among those asking the court to compel the NRC to follow the Nuclear Waste Policy Act, which obligated the agency to issue a license by June 3, 2011.

Wilson said the Yucca Mountain project is significant to South Carolina. He noted that the Savannah River Site in Aiken County, one of the U.S. Department of Energy's locations, currently acts as a temporary storage facility for nuclear waste.

He said South Carolina also has seven commercial nuclear reactors that have been required to store onsite the spent nuclear fuel they generate.

Continued delay in the approval of a permanent repository exacerbates the danger posed by the temporary storage of such toxic material, he said.

"This case represents a clear abuse of power in the pursuit of a political agenda in Washington, D.C.," Wilson said. "The NRC should do the job demanded of it by Congress, and stop putting the health and safety of South Carolinians at risk for political purposes."

Meanwhile Friday, a 15-member panel suggested building regional storage sites to warehouse spent nuclear fuel for up to 100 years, while officials seek to build a permanent burial site.

In a move likely to stir opposition in Congress, the panel also recommends that money being paid by nuclear operators for long-term storage be set aside for that purpose, rather than counted against the federal budget deficit.

About $750 million a year is paid into the Nuclear Waste Fund, which has a balance of about $25 billion.

Commissioners said they recognize that their recommendations would add to the federal deficit, at least on paper, but noted that the federal government is contractually bound to use the money to manage spent nuclear fuel.

"The bill will come due at some point," the report said. "Meanwhile, failure to correct the funding problem does the federal budget no favors in a context where taxpayers remain liable for mounting damages."

Trying to implement the current "deeply flawed program" for nuclear waste is likely to cost even more, the panel said in its 180-page report, which was released Friday on the commission website.

The panel, formally known as the Blue Ribbon Commission on America's Nuclear Future, also suggested creating a new organization, independent of the Energy Department, to locate and build a site to permanently bury nuclear waste.