ML19253A639

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Transcript of 781107 Discussion in Washington,Dc Re SECY-78-504, Classification of Sensitive Safeguards Info. Pp 1-45
ML19253A639
Person / Time
Issue date: 11/07/1978
From: Gilinsky V, Hendrie J, Kennedy R
NRC COMMISSION (OCM)
To:
References
REF-10CFR9.7 SECY-78-504, NUDOCS 7909100611
Download: ML19253A639 (46)


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August 15, 1979

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f CC"3ISSIOa CETEPRINATION REGARDING PUBLIC DISCLOSURE UNDER THE GOVERNMENT IN THE SLNSHINE ACT OF:

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"-- of Discussica of and Vote cn SECY-7s-504

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T Pursuant to 10 C?.C 9.103(c), the Com::ission has determined

-ha the subject trans crip t should be released to the public.

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John'm. Ecyle Ac-J.ng Secretary of the Cc=:aission 7000100 6 11 a <> I.

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i Transcript of Proceedings UNITID STATIS OF AMERICA NUrT.:'AR REGULATCKI CC.'Of1S SICN Discu: sion of and vote on SECY-78-504 CLASS 7ICAIICN OF SENSI~IVE SAFIGUARCS INFOMfATION

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7 Novenber 1975 ACE - FEIERAI, REPOP.TERS. INC.

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4 MELTZER/m CR1215 UNITED STATES OF AMERICA NUCLEAR REGULATORY CCMMISSION Closed Meeting DISCUSSION OF AND VOTE ON SECY-78-504 CLASSIFICATICN OF SENSITIVE SAFEGUARDS INFORMATION Cc=missioners' Conference Roca 1717 H S treet, N.W.

H shington, D.C.

Tuesday, 7 November 1978 Meeting in the abova-entitled matter was convened, pursuant to notice, at 9:30 a.m.,

JOSEPH HENDRIE, Chairman, presiding.

PRESENT:

JOSEPH HENDRIE, Chairman VICTOR GILINSKY, Commissioner RICHARD KENNEDY, Comissioner PETER BRADFORD, CcmmisLioner JCHN AHEARNE, Ccmmissioner H. Shapar D. Mathewc Burnett/

R.

Brady R.

G. McCorkle J.

Miller B.

Snyder C.

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.P_ _R.O._C_.E.__E _D _I_ _N G_ _S CF).IR"AN HENDRIE:

Why don't we go ahead and kick off.

The Commission meets this morning.

It is, I would note, a

.osed meeting, to deal with classified matters.

It is a discussion, and if people feel willing and able, a vote.

If they don't, back to consent papers.

A discussion on classification of sensitive safeguards information.

This paper originated Icng ago at the No. 75-77, came up to the Ccmmission early in 1977 as a Staf f follow on, and an intended Commission follow on to that National Security Decision Memorandum 346, I think it was which said fuel cycle facilities, one can classify information related those.

CC"MISSICNER GILINSKY:

347.

CHAIR".AN HENDRII:

347, right.

I'm a little slow this morning. I have to noten one number foraard.

he Cc= mis sio n, I guess, deferred action at that time. Then later in '77 when I looked at the situation, it seemed to me worthwhile to postpone reconsideration or further consideration oi the Staf f paper, the 75-77 paper until it was clear how we night dc with the legislation en

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4 protecting safeguards informatica that we croposed.

fiore lately I have recc= mended to dua Staf f that they send it on up to us.

As I look at this situation it seems to me that the fuel cycle f acilities that we are talking about here constitute a rather limited class.

That there are pressing reasons for establishing the national security classifica-tion en safaguards information at those facilities.

And that it really did not conflict with, nor would such authority be replaced by, in my view, that legislation if it ever passed.

Now, we had a meeting on it last week, a briefing with the Staff, discussion. You weren't able to be here, Vic.

People at that time felt that since you had expressed considerable interest in it and also suggested that we not plunge ahead to a vote, why we did not.

CC:331ISSICtIER GILIMSKY: I appreciate that.

CHAIR'd.MI EENDRIE : Then we tried to reschedule soon enough so that we would not have forgotten totally about the subject, and you could participate in the discussion.

And then we will see what course of action the Cc= mission might feel able to take today, or how it wants to go about making l

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decisions on the matter.

I think a useful thing to do would be fo: us to scan through in f a: rly rapid-fire style, some of the briefing materials that we had last time.

MR. BUTOIETT : We had projection systems.

CHAIPliAN HENDRIE : Ha'a you got a copy?

MR. MC CORKLE:

Yes, sir, I have a copy, or we have the Vugraph.

We can put up the yugraphs.

CHAIRMAN HENDRIE: Can you spare that ona?

MR. MC CORKLE: Yes, sir.

(Handing document to Ccenissioner Gilinsky.)

CHAIR 2/AN HENDRIE: Okay, good.

You came prepared.

MR. GCSSICK:

A five-minute summary, cr something?

CHAIFl!AN HENDRIE: Yes, maybe a seven-mint:e surmary, on the basis, George,that the rest of us have already been prepied on the subject by last week's meeting, and that Vic is a faster study than the rest of us.

(Laughter.)

MR. MC CORKLE:

Well, the present paper before the Ccenissioners is79-504, which was prepared in response to Chairman Hendrie's request to see what impact the new Executive Order concerning classification might have on the 1

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7 action plan for a classification program for fuel cycle facilities which was outlined in the paper, 77-75.

And as the Chairman also indicated, 77-75 was actually an outgrowth of NSDM 347 that was prepared in respor 3e to that.

And this was --

CHAIRMAN PENDRIE:

77-75 or 75-77?

MR. MC CORKLE:

77-75, sir.

Last year.

CHAIRMAN 7ENDRIE: Oh, a es.

Okay.

That is the second thing I have got to catch up on.

MR. MC CORKLE : As an outgrowth of NSCM 347, which I am sure you will recall, Cc=missioner Gilinsky, was prepared back bv the National Security Council to us in a

response to the Ccemission's recommendations following the NSM 216 study.

At which time the Commission recc=nended that certain sensitive safeguards information concerning the protection of facilities possessing significant cuantities of strategic nuclear material be classified', and inventory discrepancy data be classified for a six-month pericd, or until the end of the pending inves*.igation, whichever was later.

And the 347 just adopced those and came back to the Cc= mission with that and at the same time deferred any L

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decision on LNR protection plans.

It might be worthwaile to note that prior to the issuance of 347, ERDA, now DCE --

COMMISSICTJR GILINSKY: What was the date of J47?

MR. MC CORKLE : 347 is dated in January of 1977.

CCMMISSIONER AREAENE: The day before the new Administration came in.

CCMMISSIONER GILINSKY: Oh, this was the last action President Ford tock.

MR. MC CORKLE:

20 January 1977.

DOE had implemented Ehe classification program along these lines prior to the issuance of 347, and it still is in effect today.

Consistent with the instruction at this time we did review the Executive Order 12065 'which came out in June scheduled to replace the existing Executive Order on 1 December.

The Staff is in general agreement that the authority of the Cc= mission to classify renains the same and there is no practical difference 'cetween the two Executive Orders for the purpose of this discussion.

CCMMISSICNEP GILINSKY: Say that again.

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9 MR. MC CORKLE:

That the provisions of the Executive Order, the new Executive Order, provide the same authority to the Ccmmission to classify that existed under the old 11652 Executive Order.

And that there is no practical difference as f ar as the matter under consideration, the classification program for fuel cycle facilities which we are discussing.

There is one feature --

CCMMISSICNER GILINSKY:

Is that right. Carl?

MR. STOIBER: Well, I think there is some broader language, but I think the effect is primarily the same.

CHAIRMAN HENDRIE: Well, at least with regard to the subject at issue here, which would be the classification of safeguards, security, et cetera information for fuel cycle facilities.

MR. MC CORKLZ:

There is one feature of the new Executive Order that is of some interest to this discussicn.

The new Executive Order lists certain categories of information which may -- and I underline may -- be classified.

One of those categories is information pertaining to U.S. Government progran" for the protection of nuclecr materials or facilities.

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10 Of course there has to be a link between that and

=m10 a rea.sonable ability to identify damage to the national security or national defense before classification would take place.

In other words, just because an item of information is included under a U.S. Government program to protect such facility frcm materials, it does not autcuatically mean they would be classified.

There is a second step that has to be taken.

To refresh evervbedy's memorv.r at the present tine we do protect information under 2.790 as proprietary information.

And the Staff generally agrees that there are certain defects to that.

No truscworthiness of employees having access to the material in the facilities. Some question of the ability to pro tect the information while licensee has.

Eut primarily, the problem is -- the possible problem is perceived as being a rather shakey legal bcsis to withs'tand a gced challenge.

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In the intereses of correcting the defects contained in 2790 and to encompass a neans of pro.ecting safeguards inf orna tio n, sensitive informacion concerning classif.i ed-l s

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= mil unclassified matters, in other warfs those things that could not meet the criteria of the Executive order for classification, Mr. Shapar's staff developed a 'egislative proposal which went to the Congress early this year.

It is important here to make a distinction between unclassified safeguards information which could be considered sensitive in the interests of public health and safety, and that sensitive safeguards information which would meet the criteria of Execucive Orfsr for classification.

It is very well possible that we would need both pregrams.

There is some consensus of opinion, as I under-sta'ad it, if certain information meets the criteria of the Executive Order, it is not a matter of option as to whether it should be classified or not.

In other words, if the identifiable damage to the national security has be.en made, then the next step has to be classification.

So, I just want to stress that the approval of the classification program would not obyiate any necessity for a legislative exclusion to protect information thich did not meet the criteria of the Executive Order. In other words, unclassified information.

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12 nn Which brought us to several alternatives and the Staff's recomme..fatica was to pursue legislation, and at the same tr.me to approve a classi:1 cation program responsive to NSCM 347.

Other options or other alternatives considered would be the status cuo, which appears as alternatise 3 there in the handout, while awaiting legislation and would not envision any classification program.

The second alternative was actually fua same as the first, to go ahead and classify LWR plans unilaterally without any further referral to the NSC.

COMMISSIONER GILINSKY: What is our status on the LNRS?

MR. MC CCRKLE: I'm sorry, I didn't hear you, sir.

CCMMISSIGNER GILINSKY:

What is our status on the classification of reactors?

MR. MC CCRKLE: They are protected as prcprietary at uhe present time.

CCMMISSICNER GILINSKY: But are we awaiting any --

MR. MC CORKLE : We had recuested or recommended on June 30th of '77 to the National Security Council, that the LWR plans be classified, be protected through a classification program.

THere has never been a response to that.

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13 CO'D1ISSICNER GILINSKY : That was the Cc =ission letter of --

MR. MC CORRLE: Of 30 June.

And the same letter indicated that we were preceeding to implenent the presisiens of 347.

CCMMISSIONER AHEAR'IE: Which we have not.

MR. MC CORKLE: Which we have not done.

In other words, 77-75 is still a, rending action plan which exists today and with minor modification, if a decision were made to go ahead with the classification pro-cram, would constitute the plan that the Staff would recc mend to the ccanissien.

CCMMISSIONER GILINSKY: Okay.

Is there any indication that the NSC is going to ever --

CCMMISSICNER A'-IZA. NE :

Che NSC was asked as came cut -

Joe had asked the NSC not to answer.

COMMISSIONER KENNEDY: But sooner or later they have to do scmething.

Or, do they intend to file this as one of the pieces of information in the Archives?

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l 14 mm think their view would be to hold it.

COMMISSICNER C NNEDY:

Now that these papers are

.oublic orcoerty and not Presidential c.ac.ers any more, I suspect they will probably want to clear t.: les a little bit more effectively than may have been the case in previous days.

Who knows?

CHAIFMAN HENDRIE: You know, in due tine when it is clear that we have a satisf actory infornation protection on the things that ought to be protected and so on, why then I think we will let then know how things stand and these things get cleared.

In fact I think probably if we decide -- if things work out as I hope they will, we would not want to implement that authority, why I would think a short note from the Commission -- af ter all they ha.~e a letter frcm the collegial Commission, how about another shcrt note from the collegial Commissicn saying, sorry abcut that -- dear sir, ignore previous correspondence.

(Laughter.)

COMMISSICNER AHEAR'iE: Which will then lead them to scurry frantically trying to find the previous ccrrespen-dence.

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15 mm (Laughter.)

CCMMISSIONER KENNEDY: Not in my days they wouldn't have had to scurry.

(Laughter.)

That may have been one of the many innovations that have occurred since.

CHAIR'.JT HENDRIE : You know, this is a subject which has been in mind for a long time. And though you have contributed substantially to the literature of the field, the discussion here is by way of trying to bring us jointly under the same current "ecollection of things.

CCMi!SSIC!iER AHEAPlIE : Isn' t the ntain issue we are being asked to vote on, approving the plan to classify the sensitive safeguards information as national security information for the SSNM activities?

CHAIPlG.N HENDRIE : Yes, sir.

Precisely.

CO.'01ISSIC!iER RHEAP2iE : That is the main thing we are being asked.

COMMISSICNER GILINSKY: Let me just ask you about some little details which I probably went over before.

Once something is classified,then you have to have clearance to Icok at it.

Ncw, hcw would we just work the 1

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16 mm transition period?

We would classify as of scme date. wb.en everyone has got their clearances?

MR. MC CORKLE: There would ue a date, of course.

That is part of the schedule appended to 77-75 as to how we would go ahead and implement.

There are several cctions that are necessary.

CCMMISSIONER AliEAriE: b.ost of the peuple already have clearances.

CCMMISSIONER GILINSKY: What would you do, ss. I, with General Atcmics?

MR. MC CORKLE:

General Atomics, I think they can handle it right now.

They are quite well cleared out there.

COMMISSIONER GILINSKY: Because they have got government programs?

MR. MC CCRMLE: Yes, sir.

Of course this is a little bit out of date, it varies slightly. But we brcught cut last time that throughout the fuel cycle facilities, 70 percent of all employees present1 have an L clearance, 20 percent a Q clearance, and 10 percent are uncleared.

Mcw, of that 10 percent --

CCMMISSIONER GILINSKY:

Because the materials are

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17 mm intrinsically class:.fied since it 's Navy fuel?

MR. MC CCRKLE: Some are Navy programs --

COMMISSICNER AHEARNE: Also DOE had implemented 347 already.

I see.

CCMMISSICNER GILINSKY:,

MR. MC CCRKLE:

Scme facilities have DCD clearances.

CC.51ISSICNER GILINSM : So we are really trying to catch those that haven't been caught in these previous programs?

MR. MC CCR'{LE:

Any program.

And we estimate that the initial --

c.CM'd.ISSICNER KENNEDY : Wait.

I don't know what that reans.

CHAIRMAN HENDRIE: Yes, I'd phrase it a little differently.

I thin'< cuite apart frcm the information protection, vou miche for these f acilities thin'<, well, you kncw! evervbcdv a

s who is em.olcved cucht to be clearedr and -- bu t that isn' t the Oee -a..'. c# " ". a-

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18 Just the guards and those -- ic would be up to the licensees nm as to the number and the administrative aspects and the supervisory rolas that would need access.

In other words, on a need-to-know basis.

CHAIPRAN HENDRIE : But let.te finish the thought.

The primary thrust here is to provide a -- I guess a stronger and more appropriate protection regime for the security and materials accounting and so forth, infermation in these facilities, and to ccme away from having to depend on the ccamercial -- on w'.at is, I mus t say, a somewhat strained interpretation that it is commercial proprietary information and protectible under that regime.

So I think the main thrust really here is informa-tion, because now indeed in implenent that you in fact gather up uncleared people who are in the f aciities, who work in the f acilities and have occasion to come in contact with the information, you do indeed, inevitably gather them into the. clearance situation.

CCPMISSICNER GILINSKY: Are there any plants which none o f ' the.-

staff is cleared, which are entirely private?

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19 mm CCMMISSIONER GILINSKY: For example?

MR. MC CORKLE:

If I understand your question correctly, at the present time we have -- you know, where we have classified plans?

Do I understand your --

CO.51ISSIONER GILINSKY: No, no.

For example, U.S.

Nuc_ ear used to be entirely private.

Are there any other?

CCMMISSIONER AHEARNE: Are there any plants that have no cleared reocle?

MR. MC CORKLE:

No, no.

In fact, = cst of them are cleared.

CEAIRMAN HENDRIE : Let me point out an extension to George's remark.

I think with regard to what we norm lly call the fuel cycle facilities, the fuel fab and the scrap recovery and that sort of activity, George is right.

I think they all have -- either have had or do have government contracts which will require at least some of the staff to be cleared.

Okay.

There are several facilities, however, that at least could fall under this regime because they have special nuclear material in significant quantities.

Ft. St. Vrain, okay.

It uses fully-enriched U in the fresh fuel.

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20 mm Now, I suspect that as one detailed the regulations here, you might be able -- feel able to argue that fuel in the core, or the irradiated fuel is in effect self protected by radiation levels and so on.

And that leaves the question whether Ft. St. Vrain as a plant, a power plant, could operate with a small enough fresh fuel inventory on the site so that you wouldn't need to implement the protection provision.

COMMISSICUER GILINSKY : Let's see. Presumably it would be what, 5 kilograms?

MR. MC CORKLE: Formula quantities.

CHAI MAN HENDRIE: And since the ai:a is to protect information about significant quantities of special nuclear material, then I think if a reactor plant can't legitimately come under that inventory line, den they would have t meet the requirements of the rule.

And if that is the case, then you have got Ft. St.

Vrain which may or may not have cleared people at it, and you also have, I should like to point out, at least several research reactors.

And I think those in many ways -- four, five --

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21 Im CCBS!!SSIO'IER GILI'ISKY : C?.n you te21 me which ones they arc?

MR. MILLER: Westinghouse, Zion, RPI, NES and then, because GGA has said that December 31st they will net put fuel any more that is 70 percent enriched, Washington State, University of Wisconsin.

CHAIRMAN HENDRIE:

Isn't Missouri in that?

MR. MILLER:

Missouri has now irradiated so that they are now below and they plan to stay E Aow.

CC}SiISSICNER GILIliSKY:

And what?

They 1 ave to irradiate to this 100 --

MR. MILLER:

(Inaudible. )

The list used to include Missouri, Virginia and Battelle --

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a nAA their on-site inventcry to -- in effect what you do is to keep the fresh fuel at the suppliers until you need it.

And then you have it shipped in, get it in the reactor, and I don't know, there may need to be some special provision to cover that transition pericd.

But, once you get it in the core and crank the machine uc, whv. that is not bad for orotection.

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,o mm CCMMISSIONER GILINSKY: And how would you handle transportation?

MR. MC CORKLE:

Transportation?

Well, right now of course the only transportation is essentially in connection with export. We would have to clear certain personnel.

CC30.ISSIONER GILINSKY: What happens when, say, fuel moves for Ft. S t. Vrain?

MR. MC CORKLE: Ft. St. Vrain?

The escorts and people with knowledge concerning the shipment. But there is only one licensee really Ehat moves material within the country.

COMMISSIONER KENNEDY: Are they cleared?

MR. MC CORKLE: They do have some clearances,.ves.

COMMISSIONER KENNEDY: And they would be classified plans 2:

MR. MC CORKLE: The determination has not been made on that.

The initial thinking at the time we were cening up with what we were classifying in classificatien guide, the plans would be classified until after the shipment tcck place.

Cetails concerning the shipment.

Not everybcdy would have total information concerning it.

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23 mm You knew, we were trying to limit it to a smaller nu.ber of peop'.e.

CHAIP3.AN HENDRIE : But it is f air to say that at least some of the asc.ects of the transportation security plan would, indeed be classified. And that inevitably means that there would have to be some cleared people conr :cted --

CCMMISSICNER K NNEDY: But again they are already, c

the people involved.

MR. MC CORKLE:

Tri-State dces have a number of cleared pertennel.

I don't knew if I have that information --

MR.MATHEWS: I might point out the shipments to the test and research reactors are made in small lots, so they de fall under the threshhcid.

MR. MC CORKLE : Ft. St. Vrain was the only one we went with the whole works, test and research.

MR. ;1ATHEWS :

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St. Vrain is the one reactor that the fuel reload is so large, it does fall over the formula quantity.

MR. MC CORKLE: It tock four shipments didn't it?

MR. MATHEWS : Yes, it tcck four shipments and they all fell over.

MR. MC CORKLE : Every one of ther fell over.

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movements are less than five formula kilogram quantities at any one time.

So that transportation =cde would not require any cv.r.e of classification as envisioned now.

CHA:?.v>27 HINORIE : That's a help.

MR. MC CORKLZ: We have very few shipments, as you

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CHAIP.v.AN HENDRIE :

We were estimating -- I speculated the last time, and the Staff at leact didn' t cbj ect to the number -- that in terms of clearance, new clearances, people that would be brought into the clearance, the national security clearance regime, were not now under it, that that number under the proposal here might run to several hundred.

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But I think it is clear that it does n~ot run to thousands.

Cnce ycu get to reactor plant matters, why then these would begi.7 to have a large MR. MC CORKLE: Well then fuel cycle facilities we felt a good ballpark figure was around 250.

And of course there would be -- Mr.Brady has indicated of course we would accept clearances that were given, you know, by other federal t

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But there >culd be about 250 new clearances.

MR. BURNETT : Are those L or Q, George?

MR. MC CORRLE:

It would probably be a mix, depending en the position and extent of access.

A gcod portion of them would be Q I would suspect.

MR. SNYDER: At Ft. St. Vrain, George, would you require then at all times the clearances to be in effect.

What I am saying is that fuel is there for a short tine unirradiated. They don't store large quantities on site, I guess, do they?

MR. MILLER:

About three months out of the year.

MR. SNYDER: I see.

They have spares?

MR. " ILLER: That fuel would be in essentially cold storage.

MR. SNYDER: S u-4.uring that period they are treated pretty much like the fue_ facilities are treated?

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They come under Part 73 Regs?

MR. MILLER:

New they are.

MR. SURNETT : But they meet all the protecticn regulations.

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alternatives presented in the Staff paper, Vic,that the one I am reccrr.ending to the Cc= mission is No. 1 with a deletion.

The second last page of this pack lays out the provisions.

CCES1ISSIGNER GILINSKY: And you are deleting the last item there?

CHAI??>2i HENDRIE:

Yes, because I don't see any need to stir up sleeping dogs.

(Laughter.)

Maybe you better delete that expression.

(Laughter.)

CCM"ISSICNER KENNEDY: Since it is your dog.

(Laughter.)

CC)S!!SSICNER AHEAFlII: Is it necessary at this time to take a position on the enactment of legislation?

CHAIFP3.'I HENDRIE : I think in fact that it is not and we could very well simply delete that one. And as we come closer to the 96th Congress --

CCBS!ISSIGNER AHEAP2;E : The reason ! raise that is, I haven't reached a position on that piece. That didn't seem to be

+.e central element in this.

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  • 27 mm I think it simply represented the Staf f 's view, that it is their recommendation that we classify the safeguards information at the fuel cycle thing and didn' t mean that they were, in turn, saying well, never mind the proposed legislation.

But, in terms of the essential action to be taken here, why it is not an essential piece.

To sinc.lifv. the croc.osal, why if it would be a help I would be glad to delete B also.

CC:Oi!SSIONER BRAOFORD: Mcn't that also take care of C?

The last time we established rhat C really meant 3.

CHAIFF_AN HENDRIE: I would be glad to do that, too.

COMMISSIONER KENNEDY: What is the proposal?

CHAIFlG_. HENDR :3.

I think it is quite clear that we are not here about to rush pell mell forward and try to classify reactor plan. matters.

You know, there are obvious rcarons why that is a very considerable step.

We weren't going in that direction before, and there is clearly no intention to go that way here.

Alternative 1, sub A only is my reduced recommendation to you.

CCIO1ISSIONER AHEARNE: I ' l.' vote for thar.

CHAIRMAN HENDRIE:

There, I have collected one.

Vic, how do you --

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mm CCMMISSICNER GILINSKY: I must say it is a difficult decision. I think there is a lot to -- certainly Z think classifying the information would put this protecti-on a firmer bmsis. And I like the idea of drawing a distinction between the problem of people stealing bcmbs and bonb material and other kinds of dangers that you might say is the easis of the President's approach towards nuclear ener-v..

w I'm saying, we will go forward with what is safe, and take another look at what is more dangerous.

At the same time, for reasons I have laid out many times before, I am concerned about the precedent that is getting sat here.

And while the dangers frcm people stealing weapons-capable material are to my mind a great deal greater than those from other potential risks that people worry about, it is not c. lear that --

CCMMISSICNER KENNEDY: What. risks are these?

CCMMISSICNER GILINSKY: Ch, for example, reactor sabotage.

COMMISSICNER K2NNEDY: Ckcy.

CCMMISSICNZ2 GILINSKY:

A bunch cf other things,

blowing up oil plants, whaterer.

It is not clear that the line will get drawn there.

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29 mm I would be happier with sc=e sort of statutory solution that would draw a firmer line and say that national security classification in the private sector cannot go beydad certain bounds.

And to to beyond those bcunds you have to have the approval of the Congress.

Because what we are talking about here is an extension of nacional security classification into the private sector.

I believe the action would be completely r arecedented.

I don' t think there is any example of the government classifying material in the private sector, which is not in scme way related to the government under its contract, or by some other --

MR. SHAPAR: I think there may be one precelant that DCE has either classified or is about to classify laser enrichment technology, which has been developed.

CCMMISSICNER GILINSKY: Under restricted date?

MR. SHAPAR: Yes.

COMMISSION 5tGILINSKY:

Restricted data ic different.

In that aspect restricted data, so far as I kncw, has never really been tested in the ccurts.

And I wonder whether it would stand up.

But, that is another matter.

But it is a different kind of classification.

Restricted data goes by subject 4

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30 mm matter, in effect.

And national security classification, at least traditionally, has been restricted to government-related materials, or government-originated materials.

So, I guess much as I would like to see a firmer base provided for this classification -- for the protection, I think I would seek a legislative solution.

CCSS!!SSICNER KENNEDY: Ym.would therefore, in connection with Option 1, support 3 and C?

w w a.nre c T m m o e.

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v. n s.

e-a COMMISSIONER AHEARNE :

I think21at he is saying is that he would not suppcrt Option 1.

CCMMISSIONER GILINSKY: At least at this point.

CCES!ISSICNER A'iEARNE :

Vic, what kind of a legislative solution would you hate in mind?

CChr!!S3:CNER GILINSKY: Well, I thi.tk if one had an exemption from the Freedom of Information Act, that would pretty well take care cf things.

If one warted to go beycnd that and institute national securicy classification, I guess I wculd like tc see that limited by statute in scme way, because they are creacing a precedent that vould alicw -- the next s.ep would be t

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classification of reactor plans en the basis tat they may affect the national security.

I don't think te Commission at this point wants to do that, but there has certainly been a lot of support for that in the Commission in the past, and the Ccemission in the past certainly has suppcrted that step.

The next step would be to classify all sorts of sensitive facilities, all kinds of things affect the national security.

You know, one just has to thinx about oil refineries, the Alaska pipeline and so on.

CCMMISCICNER AREUNE :

Is part of your concern that as f ar as -- is it primarily the precedent, or is it that you don't see that there could be made a justifiable case that an item '.s classifiable under national security informatien unless it is related to a govern. ment prcgram?

COMMISSICNER GILINSKY: Well, I would say just as a atter of policy, I would prefer that national security classification not be easily extendable into te private sector just by administrative means.

So it is primarily a precedent.

Ncw if -- I mean, I think one can make a very s trc:.g case of this.

If these matters deal with national security

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32 na snd the reason is to seek a firmer base for the protection of the materials and informatiot and then it could reasonably fall under national security classification.

3ut, at the same time one is taking a step that hasn' t Meen taken since,.you knc -

1776. And I guess I am not persuaded it is the wise thing to do.

CCM'CFMONER AHEAPlIE: Is that obvious?

Is that correct, Carl, to the extent that you know, that there has never anything been classified?

MR. STOIBER: I j ".st have not examined the question closel f enough to know.

I think it generally is true.

MR.SEAPAR:

I have not examined it.

MR. STOIBER: It is highly unusual, if not unprecedented.

CCMMISSICNER AHEARNE: I am sure it is unusual.

CCMlCSSICNER GILINSKY: The only example that I can think of is the. EC classified centrifuge data in the early '60s.

MR. S"APAR: As restricted data.

CCMMISSICNER GILINSKY: But, it was as restricted data.

And the ccmpanies all had contracts with the govern-ment and decided not to fight it.

1 the thing never --

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in fact I think tey only indicated that they.iould classify.

They never implemented part 26.

COMMISSIONER AHEARNE: No, it is classified.

'CCMMISSICNER GILINSKY:

I guess it is classified.

But there was actually a part 26 that was privately-generated restricted data that was going to be implemented.

MR. SEAPAR: Restricted data or other classified defense information.

Why would the principle be any different?

CCD1ISSICNER AHEAPlC: It is classified.

CCMMISSIONER GILINSKY: I think that the principle of restricted data just would not stand up.

The way restricted data works is that you classify it by category regardless of the origin of materials.

So, while a person say who works in a filling station cannot think national security classified thoughts, he can think just without having any access to the government, restricted data, classified, you knew, thoughts.

And should he tell his wife, he would then be violating security even if he thcught it up himself.

I just don't think that concept is ever going to stand up.

It has never been tested.

CC.v24ISSICSER.'.EEARNE : But you would agree that as i _

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34 mm far as the precedent of naving classified as industrial process,that vou disa-ree with the applicaticn of it, but it v

does sound like in a way, that precedent has already been taken?

,CC01ISSIONER GILINSKY: I don't think so. I think restricted data is different, and I just don' t think that is a relevant preced'nt.

CC:01ISSIONER AHEARNE: All right.

The other two cases that I was trying to think of is NSA --

COMMISSICNER GILINSKY: NCw there is a case going on I think with the University of Wisconsin. Scmebcdy who

~

generated scre algorith=a for dealing with codes has had his material --

CCMMISSICNER AHEARNE : Classified.

COMMISSICNER GILIUSKY:

-- I believe classified and the university is fighting it, and I don't knew where that stands.

It is in the courts.

COMMISSICNER AHEAFliE: My inpression was that it had been --

MR. BRADY: I don't kncw where it stands, sir, but there was another case where -- in the nuclear propulsion h

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e 35 nm program where therc was informaticsthat was totally unclassified and when Admiral Rickover went over to Russia and found cut the state of their program, he ther. came back and classified that Naval nuclear propulsion Laformation, which was previously totally unclassified.

MR. SHAPAR:

But that was restricted data again.

MR. BRADY: Primarily restricted data.

But there is seme national security information.

COMMISSIONER AHEARNE: I can appreciate your concern, and I don' t think in my mind, the question of whether or not it is a precedent is that important.

The concern I can understand.

I think it is an important concern.

Withcut having done a detailed review of the record of both D00 and NSA, I culd question tthether it is really a precedent. I would suspect it has already been done.

CCMMISSICNER GILINSKY: Well, I don't know of any cases.

CCMMISSICNER AHEARNE :

Yes.

CHAIRMAN HENDRIE: I must say for myself, whether.

cr not it is a precedent has considerably less importance than the fact that the underlying statutes and the Executive Order which has recently been redone, and the new one will beccme effective this '-

cier 1st, both the underlying

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36 statutes and the new Executive Crder -- and in my reading mm the sense of the current Congress encourages us to go ahead and do this.

We have the authority under the statute, we have the authority under the Executive Order both old and new.

And I find in the admonitions as I set before Senators and Representatives, whv aren't you protecting this stuff better, a clear sense there that where the security informa-tion about these materials is of sensitive nature, you know, to deal with it.

So, whether it is precedent or whether it is not makes considerably less difference to me than the fact that the Congress in its wisdom has seen fit to provide this authority to the Conmission, and the President has -- Presidents past and present have executed appropriate Executive Orders to guide it and put it in place.

CCMMISSICNER GILINSKY:

If you do go forward, I guess I would urge that it be justified on the basis of the unusual nature of the problem, that one doesn't think that this precedent ought to be extended easily elsewhere.

CCMMIS5ICNER AHEA?2iE : I agree with that.

CHAIFJ4AN HENDRIE: I certainly have no objection to that.

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37 mm Det's see, the nature of the action that might be taken here, Carl, is what?

MR. SHAPAR: Code of Rules.

COMMISSICNER GILINSKY:

Is that what this is, a propos:d rule?

MR. MC CORKLE: I think the implementation of the program would not be a proposed rule on this, but you would have Parts 25 and 95 would have to go out as rules.

That is for facility and personnel clearance programs for information.

And Mr. Brady has got paper on that, I believe.

Don't you?

MR. 3RADY:

That's right, 77298.

CHAIRMAN HENDRIE: The action here, if the Com::tission were to approve the Staff recc=mendation or a piece of it, you kncw, cut out B, C and D or whatever, but approve the essential recc=mendation to classify sensitive safeguards information facilities, then the Staff would be authorized to commence preparation, or maybe ccmplete preparation of a classification what, guide or manual or whatever?

MR. BRADY: That's correct.

Classification guide.

CHAIF29.N HENDRIE:

Which is an essent-ial step in r

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32 mm implementing classification.

The first thing you have to do is have the guide or the manual or whatever, right?

MR. BRADY: That's correct.

CHAIRMAN HENDRIE: And then that woulc bave to be published.

And once that was published, then you would go anead and classify various papers according to the directions in the manual or guide, right?

MR. B RA.",Y : Yes.

CHAIPl!AN HENDRIE: Okay, so that would require a rulemaking?

MR. BRADY:

No, sir.

CHAIPP.AN HENDRIE : But the clearance aspects to establish and administer the clearance programs for a licensee would require adjustments to, you say what parts?

MR. BRADY:

Parts 25 and 95 in the Federal Register.

CHAIPJtAN HENDRIE: Nell, I was just searching for what the nature of the Commission pronouncement en the matter might be, as an appropriate vehicle for scme cautionary sorts of remarks along the lines that you have just mentioned, Vic.

MR. SNYDER: There is a public announcement, isn't there?

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s MR. SNYDER: We can use that and notify the licensees in advance of the rule being published, that we are going to go out with the rule.

(Simultaneous discussion.)

MR. SHAPAR:

Also a statement of consideration is two parts.

CHAIP3!AN HENDRIE : Other cccments and discussion?

(No respense)

Well, in spite of your remarks, Vic, which I appreciate, I am going co recommend to the cccmission that we approve the plan to classify sensitive safeguards information for activities connected with significant quantities of special nuclear material, i.e. alternative 1A.

I think it isn' t necessary to pick up these others,

3, C and O in the Staff paper, explicitly. I think it is clear where we stand on that.

I would add then to the reccmmendation that we approve alternative 1A. The suggestion that Vic has made that in whatever statements the Cctaission makes, there be note of the special nature of these activities in the need for protection, and an expressicn of the Commission's belief that b

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mm the extension of these recuirements needs to be done with great care.

COMMISSICiER KENNEDY:

I would agree with that with, however, an amendment on my personal account, not to affect the decision. Simply to note that I also support 13, simply because we have a long record indicating that under current circumstances we are likely unable to protect that information and there is no doubt about the need to have it protected.

CHAIEMAN EENDRIE:

For the plans.

COMMISSIONER KENNEDY:

And there seems little alternative but to find some legislative basis for doing that.

And to suggest now further deferral of that, I think, is a mistake.

COMMISSIO:iER GILINSKY: Well, when I said --

CCMMISSACNER KENNEDY:

I think you would agree with that.

CCMMISSICNER GILINSKY: Right.

What I was concerned about is in a sense administra-tive extension of national security classification.

I think we all agree that the T.aterial needs protection, ad I certainly support a legislative -- (Inaudible.)

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41 mm MR. STCISER: We wccid anticipate including that in the legislative package we will be sending in December.

CHAIRM.AN HENDRIE: Yes.

I think John's only point here was that it wasn't key to this action this, morning, and that he would like a chance to study it before he developed what he felt might be a ccmmitment in voting for the basic proposal, a co=mit-ment to a thing he hasn't had a chance to read through and understand, which I think is fair enough.

CCDiISSIONER KENNEDY: That's fine, except that I personally believe that deferral is both unwarranted and in my view --

COMMISS!CNER AHEAP2IE: Dick, I don't mean defer so that it doesn't get in in January.

COMMISSIONEF KDCIEDY:

Okay, fine.

So in a sense we are supporting the point made there that we are continuing to support some legislative effort in this regard. That's =y point.

I vigorously support Ccamissioner Gilinsky's strong drive to this end.

(Laughter.)

COMMISSIONER GILINSKY: I'm fcr 13.

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42 mm (Laughcer. )

CCMMISSICNER KENNED?: So that is what I just said.

CHAIRMAN HINDRIE: Let the record shcw that we have individuals noting that they support 13.

But I think the essence of the decision this morning is LA with the cautionary language to go in Ccmmission statements.

And if we could act en that--I will count a positive on John's part.

Vic, you would --

CCMMISSICNER GILINSKY: I would seek the legislative, but I certainly join in your remarks about limiting the extension -- (Inaudible.)

(Laughter.)

CHAIFSCI HENDRIE :

Okay.

Peter?

COMMISSIONER BRADFORD:

kye.

CHAI?JiAN HENDRIE: And I'll vote for it.

Shall we make it four?

Do you want to abstain or vote against?

COMMISSIONER GILINSKY: I would like to be recorded as voting for a legislative solucien, for seeking a legislative --

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43 CC:OiISSICNER KIN':EDY : Well, i am voting for that, m:a too. But not this part of the package because I don't think it will cover it.

CHAIPlWI HENDRIE:

I think in terms of the base motion, I think that as an expression of preference for a different one is a negative vote.

I'll just see hcw we recorded it here.

Four, one,and the base motion carries.

So, let us please go forward.

Is there anybcdy that has to do something, who isn't sure what it is he has to do?

(No respcnse.)

Is there anybcdy who cught to do scmething who doesn't know he ought to do it?

There new, that's a different question.

(Laughter.)

If you have a really gced staff, they knew who that is.

MR. SNYDER: Just a question.

Is it 290A?

Is that going to be resubmitted now?

MR. BRADY:

290A will be resubmitted.

MR. SNYDER:

We have got to make some changes to O

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44 mm that?

MR. S ?3.DY : That's right, for various reasons.

CHAI?J1AN HENDRIE:

290A is what?

MR. SNYDER:

That's the 25 and 95.

That's to get the mechanics in place, the rulemaking in place.

MR. SHAPAR:

Staf f doesn't have rulemaking authority.

MR. SNYDER: We are sending out two new rules.

CHAIRMAN HENDRIE:

Okay, so we will have an amended paper No. 290, which will put in place the rulemaking in parts 25 and 95 to implement what we have done now.

MR. SNYDER:

There is a s:hedule for all this.

CHAIFJ1AN HENDRIE: When you send that up, will you put a note on the cover of it that says, "You have already agreed to do this."

(Laughter.)

MR. 3RADY:

Yes, sir.

CHAI?J4AN HENDRIE :

To remind --

CC:!'4!SSIONER AHEARNE : Do you think it will carry any weight.

CHAI?liAN HENDRIE: I have the feeble hcpe that ~1t may remind us that we have in essence made a basic decision 4

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- n' here, and that in looking at the 290 paper, you may want to read the language in which the proposal for rulemaking is couched, see if you like the language.

But, I think we have made the basic decision to go forward with the effort here.

Okay?

Thank you very much.

(Whereupon, at 10:30 a.m.,

the hearing in the above-entitled matter was adjourned.)

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