ML19256A776

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OIG-19-A-19 Audit of NRCs Oversight of Supplemental Inspection Corrective Actions Final Report
ML19256A776
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Issue date: 09/13/2019
From: Baker B
NRC/OIG/AIGA, OIG Watch
To: Margaret Doane
NRC/EDO
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OIG-19-A-19
Download: ML19256A776 (19)
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Audit of NRCs Oversight of Supplemental Inspection Corrective Actions OIG-19-A-19 September 13, 2019 All publicly available OIG reports (including this report) are accessible through NRCs Web site at http://www.nrc.gov/reading-rm/doc-collections/insp-gen

UNITED STATES NUCLEAR REGULATORY COMMISSION WASHINGTON, D.C. 20555-0001 OFFICE OF THE INSPECTOR GENERAL September 13, 2019 MEMORANDUM TO:

Margaret M. Doane Executive Director for Operations FROM:

Dr. Brett M. Baker /RA/

Assistant Inspector General for Audits

SUBJECT:

AUDIT OF NRCS OVERSIGHT OF SUPPLEMENTAL INSPECTION CORRECTIVE ACTIONS (OIG-19-A-19)

Attached is the Office of the Inspector Generals (OIG) audit report titled Audit of NRCs Oversight of Supplemental Inspection Corrective Actions.

The report presents the results of the subject audit. Following the September 9, 2019, exit conference, agency staff indicated that they had no formal comments for inclusion in this report.

Please provide information on actions taken or planned on each of the recommendation(s) within 30 days of the date of this memorandum. Actions taken or planned are subject to OIG followup as stated in Management Directive 6.1.

We appreciate the cooperation extended to us by members of your staff during the audit. If you have any questions or comments about our report, please contact me at (301) 415-5915 or Paul Rades, Team Leader, at (301) 415-6228.

Attachment:

As stated

Office of the Inspector General U.S. Nuclear Regulatory Commission Defense Nuclear Facilities Safety Board Results in Brief Audit of NRCs Oversight of Supplemental Inspection Corrective Actions What We Found NRC conducts supplemental inspections to assure licensee corrective actions effectively address and preclude repetition of significant performance problems. However, NRC does not centrally organize information about licensees planned corrective actions associated with 95001 and 95002 supplemental inspections to ensure verification of their effectiveness. This occurs because NRC does not require staff to centrally capture and organize planned corrective actions information associated with 95001 and 95002 supplemental inspections. Improving the consistency and quality of 95001 and 95002 inspection report data, while also leveraging technology to make this information more readily accessible to agency staff and senior management, can reduce the risk of oversight lapses and streamline workflow for greater efficiency.

What We Recommend This report makes two recommendations to support improved documentation of significant planned corrective actions associated with 95001 and 95002 supplemental inspections.

Agency management stated their general agreement with the finding and recommendations in this report.

Why We Did This Review The U.S. Nuclear Regulatory Commissions (NRC) Reactor Oversight Process (ROP) verifies that U.S. reactors are operating in accordance with NRC rules, regulations, and license requirements.

NRC staff uses the ROP to evaluate NRC inspection findings and performance indicators records for each reactor and uses this information to assess the reactors safety performance and security measures.

While performance indicators can provide insights into plant performance in selected areas, the NRC's supplemental inspection program provides in-depth information for monitoring and assessing plant performance.

The audit objective was to assess how NRC uses supplemental inspections to verify licensees corrective actions, and how NRC documents supplemental inspection results.

OIG-19-A-19 September 13, 2019

Audit of NRCs Oversight of Supplemental Inspection Corrective Actions ABBREVIATIONS AND ACRONYMS.......................................................... i I. BACKGROUND................................................................................ 1 II. OBJECTIVE...................................................................................... 5 III. FINDING........................................................................................... 5 A. NRC Should Improve Supplemental Inspection Corrective Action Information Quality, and Centrally Capture and Organize This Information.................................................................................. 5 Recommendations.............................................................................. 9 IV. AGENCY COMMENTS................................................................... 10 APPENDIXES A. OBJECTIVE, SCOPE, AND METHODOLOGY............................... 11 TO REPORT FRAUD, WASTE, OR ABUSE............................................. 14 COMMENTS AND SUGGESTIONS.......................................................... 14 TABLE OF CONTENTS

Audit of NRCs Oversight of Supplemental Inspection Corrective Actions i

NRC US Nuclear Regulatory Commission OIG Office of the Inspector General PI&R Identification and Resolution of Problems ROP Reactor Oversight Process RRPS Replacement Reactor Program System ABBREVIATIONS AND ACRONYMS

Audit of NRCs Oversight of Supplemental Inspection Corrective Actions 1

Reactor Oversight Process The U.S. Nuclear Regulatory Commissions (NRC) Reactor Oversight Process (ROP) verifies that U.S. reactors are operating in accordance with NRC rules, regulations, and license requirements. If reactor performance declines, NRC increases its oversight to protect public health, safety, and the environment. Increased oversight can range from conducting supplemental inspections to shutting a reactor down.

NRC staff uses the ROP to evaluate NRC inspection findings1 and performance indicators2 records for each reactor and uses this information to assess the reactors safety performance and security measures.

Through the ROP, NRC places each reactor in one of five ROP Action Matrix categories.3 The top category is fully meeting all safety cornerstone4 objectives, while the bottom category is unacceptable performance. For each cornerstone, NRC develops findings from inspections and evaluates performance indicator data collected by licensees.

Each performance indicator and inspection finding is measured against the criteria using a color-coded system for safety performance (Figure 1 gives an overview of increasing safety significance):

1 An Inspection Finding is a performance deficiency determined to be More-than-Minor.

2 Performance Indicators provide an objective indication of key attributes of licensee performance in each of the cornerstones. Performance Indicators determine acceptable levels of operation within substantial safety margins.

Performance Indicators are designed to be objective and risk-informed to the extent practical, but also accommodate indications of a reduction in defense-in-depth, based on existing regulatory requirements and safety analyses.

3 The five categories are: licensee response, regulatory response, degraded performance, multiple/repetitive degraded cornerstone, and unacceptable performance.

4 Cornerstones are nuclear plant activities that are essential for the safe operation of the facility. These cornerstones are grouped under the categories of reactor safety, radiation, and safeguards.

I. BACKGROUND

Audit of NRCs Oversight of Supplemental Inspection Corrective Actions 2

  • Green indicates a finding of very low safety significance.
  • White indicates a finding of low to moderate safety significance.
  • Yellow indicates a finding of substantial safety significance.
  • Red indicates a finding of high safety significance.

Figure 1: Reactor Oversight Action Matrix Performance Indicators Source: NRC While performance indicators can provide insights into plant performance in selected areas, the NRC's supplemental inspection program provides in-depth information for monitoring and assessing plant performance.

Supplemental Inspection Program NRCs supplemental inspection program is designed to support NRCs goals of maintaining safety and improving the effectiveness, efficiency, and realism of the regulatory process, and reducing unnecessary regulatory burden. Supplemental inspections are required to provide enhanced information regarding safety at facilities where risk significant performance problems have been identified. These performance problems may be identified either by inspection findings or evaluated as greater-than-green using the Significance Determination Process5 or 5NRC staff uses the Significance Determination Process to determine the safety or security significance of inspection findings. The process provides an initial screening to identify those inspection findings that do not result in a significant increase in plant risk (a green finding). In 2016, OIG conducted an audit of NRCs significance determination process, and published OIG-16-A-21, Audit of NRCs Significance Determination Process for Reactor Safety. The report made four recommendations to improve the overall management of the significance determination process.

Audit of NRCs Oversight of Supplemental Inspection Corrective Actions 3

when green performance indicator thresholds are exceeded. In general, supplemental inspections are performed for greater-than-green performance problems.

NRC inspectors conduct supplemental inspections in accordance with inspection procedures 95001, 95002, and 95003 to sufficiently challenge aspects of the licensee's evaluation, corrective plans, and actions to ensure that the cause(s) of the performance problem have been correctly identified and that appropriate corrective plans and actions are in place to promptly and effectively address and preclude repetition of significant performance problems. Each inspection procedure becomes deeper and broader as the significance of the performance problems increases.

Table 1 provides an overview of the supplemental inspection procedures.

Table 1: Supplemental Inspection Procedures Overview Supplemental Inspection Procedure Scope Inspection Procedure 95001, Supplemental Inspection for One or Two White Inputs in a Strategic Performance Area Inspection reviews licensees evaluation of root and contributing causes, extent of condition and cause, and corrective actions. It is limited to specific issue(s) or performance area of concern.

Inspection Procedure 95002, Supplemental Inspection for One Degraded Cornerstone or any Three White Inputs in a Strategic Performance Area Inspection reviews licensees evaluation of root and contributing causes, extent of condition and cause, and corrective actions for both individual and collective issues. It determines if safety culture components caused or significantly contributed to risk significant performance issues and independently assesses the licensees extent of condition.

Inspection Procedure 95003, Supplemental Inspection for Repetitive Degraded Cornerstones, Multiple Degraded Cornerstones, Multiple Yellow Inputs or One Red Input Inspection evaluates the key attributes of affected strategic performance areas to determine if continued operation of the facility is acceptable and whether additional regulatory actions are necessary. It independently assesses the extent of risk significant issues, the adequacy of the programs and processes used to identify, evaluate, and correct performance issues and evaluates the adequacy of programs and processes in the affected strategic performance areas. It develops insights into the overall root and contributing causes of identified performance deficiencies, determines if the NRC oversight process provided sufficient warning to significant reductions in safety, evaluates the licensees third-party safety culture assessment and conducts a graded assessment of the licensees safety culture based on evaluation results.

Source: OIG generated from IMC 2515, Appendix B, Supplemental Inspection Program.

Audit of NRCs Oversight of Supplemental Inspection Corrective Actions 4

NRC completed and issued 26 supplemental inspection reports from October 1, 2016, through December 13, 2018. Figure 2 shows the number of completed supplemental inspection reports for 95001 and 95003 inspections.6 Figure 2: 95001 and 95003 Inspection Reports Issued Between October 1, 2016, and December 13, 2018 Source: OIG analysis of completed supplemental inspection data from NRCs Replacement Reactor Program System.

NRCs Supplemental Inspection Oversight Roles and Responsibilities NRCs Office of Nuclear Reactor Regulation is responsible for the overall management, support, and oversight of supplemental inspections, including the language used in the supplemental inspection procedures.

The Division of Inspection and Regional Support within the Office of Nuclear Reactor Regulation revises the reactor inspection procedures and oversees regional implementation. NRC inspectors are responsible for performing supplemental inspections, while regional managers oversee these and are responsible for ensuring supplemental inspections are completed.

6 There were no 95002-inspections identified between October 1, 2016 and December 13, 2018.

Audit of NRCs Oversight of Supplemental Inspection Corrective Actions 5

The audit objective was to assess how NRC uses supplemental inspections to verify licensees corrective actions, and how NRC documents supplemental inspection results. Appendix A contains information on the audit scope and methodology.

NRC generally uses supplemental inspections to verify licensees corrective actions, and documents supplemental inspection results in accordance with established agency guidance. However, NRC could benefit from higher quality and better organized information regarding corrective actions associated with 95001 and 95002 supplemental inspections at nuclear power plants.

A. NRC Should Improve Supplemental Inspection Corrective Action Information Quality, and Centrally Capture and Organize This Information NRC conducts supplemental inspections to assure licensee corrective actions effectively address and preclude repetition of significant performance problems. However, NRC does not centrally organize information about licensees planned corrective actions associated with 95001 and 95002 supplemental inspections to ensure verification of their effectiveness. This occurs because NRC does not require staff to centrally capture and organize planned corrective actions information associated with 95001 and 95002 supplemental inspections. Improving the consistency and quality of 95001 and 95002 inspection report data, while also leveraging technology to make this information more readily accessible to agency staff and senior management, can reduce the risk of oversight lapses and streamline workflow for greater efficiency.

II. OBJECTIVE III. FINDING

Audit of NRCs Oversight of Supplemental Inspection Corrective Actions 6

NRCs Supplemental Inspections Should Assure Licensees Corrective Actions Effectively Address and Preclude Repetition of Significant Performance Problems According to NRCs supplemental inspection program guidance, Inspection Manual Chapter 2515, Appendix B, Supplemental Inspection Program, NRC conducts supplemental inspections to support the agencys goal of maintaining safety and improving the effectiveness, efficiency, and realism of the regulatory process. Specifically, supplemental inspections are performed to assure licensees corrective actions effectively address and preclude repetition of significant performance problems.

NRC Does Not Centrally Capture and Organize Information About Licensees Planned Corrective Actions Associated with 95001 and 95002 Supplemental Inspections Unlike corrective actions associated with 95003 supplemental inspections-which are documented through the agencys Confirmatory Action Letter7 process-NRC relies on resident inspectors and licensees to manage information on planned corrective actions from 95001 and 95002 supplemental inspections. NRC resident inspectors often manually save planned corrective actions information on white boards or Excel spreadsheets. Additionally, the regions each have different approaches to following up on planned corrective actions. For example, one region follows planned corrective actions through a SharePoint site, whereas another region does through end-of-cycle meeting8 documents.

Further, licensees maintain corrective action information in their corrective action programs. However, a licensee can change the corrective action information in their corrective action program without notifying NRC. Only 7 Confirmatory Action Letters are letters issued to licensees or, if appropriate, to non-licensees subject to NRC jurisdiction to emphasize and confirm an agreement to take certain actions in response to specific problems.

8End-of-Cycle meetings are where staff discuss NRCs assessment of the licensees performance results.

What Is Required What We Found

Audit of NRCs Oversight of Supplemental Inspection Corrective Actions 7

for inspection purposes can NRC access corrective action information in the licensees corrective action program.

Additionally, among other things, assessments of corrective actions, associated with 95001 and 95002 supplemental inspections are supposed to be documented in supplemental inspection reports. OIG analyzed 25 95001 supplemental inspection reports issued from October 1, 2016, through December 13, 2018. Of these, 14 did not provide sufficient information about planned corrective actions to allow the reader to understand the intended actions. In addition, the level of detail varies among the reports, which could impact the ability of NRC inspectors to efficiently identify planned corrective actions for future follow-up inspections, such as the agencys Baseline Inspection Program, Inspection Procedure 71152, Identification and Resolution of Problems9 (hereafter, PI&R) inspection. For example, inspectors preparing for PI&R inspections spend time10 reviewing prior inspection reports, including supplemental inspection reports, to select problems that have been processed through the licensees corrective action program, to evaluate program effectiveness.

Guidance Lacks Clarity on Information Quality, and Agency Lacks Means to Centrally Manage Corrective Action Information NRCs supplemental inspection guidancespecifically, NRC inspection procedures 95001 and 95002, Inspection Manual Chapter 0611 Appendix C, Guidance for Supplemental Inspection Reports, and Inspection Manual Chapter 2515, Appendix B, Supplemental Inspection Programdoes not specify the level of detail required for documenting planned corrective actions associated with 95001 and 95002 supplemental inspections.

Additionally, while 95001 and 95002 supplemental inspections reports are supposed to be saved in the Agencywide Documents Access and 9 NRC staff noted they follow up on corrective actions through PI&R inspections. PI&R inspections are conducted biennially and on a sampling basis. On June 28, 2019, NRC staff recommended the Commission change the frequency of PI&R inspections from a biennial to a triennial cycle.

10 The PI&R biennial team inspection is estimated to take an average of 212 to 288 hours0.00333 days <br />0.08 hours <br />4.761905e-4 weeks <br />1.09584e-4 months <br /> of direct inspection effort.

Why This Occurred

Audit of NRCs Oversight of Supplemental Inspection Corrective Actions 8

Management System, NRC does not systematically capture corrective action details from these reports and save them in a data system such as the Replacement Reactor Program System (RRPS). NRC uses RRPS to capture other key elements of reactor inspection results.

Oversight and Efficiency Could Be Improved with Higher Quality and More Readily Accessible Information Regarding Supplemental Inspection Corrective Actions Information regarding corrective actions associated with 95001 and 95002 inspections is important to a variety of NRC oversight activities, including PI&R inspections, end-of-cycle meetings, and changes to licensee status in the ROP Action Matrix. While NRC staff have access to licensees corrective action program data and can query inspection reports on an as needed basis, this information is not currently captured and organized in a centralized NRC data system such as RRPS. Improving the consistency and quality of 95001 and 95002 inspection report data, while also leveraging technology to make this information more readily accessible to agency staff and senior management, can reduce the risk of oversight lapses11 and streamline workflow for greater efficiency.

11 During this audit, OIG found one case in which a PI&R inspection team only learned of completed supplemental inspection corrective actions because the licensee volunteered this information. OIG also found another case in which a licensees corrective actions reportedly changed significantly enough over time that they no longer met the intent of the corrective actions driven by a supplemental inspection.

Why This Is Important

Audit of NRCs Oversight of Supplemental Inspection Corrective Actions 9

Recommendations OIG recommends that the Executive Director for Operations

1. Update NRC inspection guidance to support documentation of significant planned corrective actions associated with 95001 and 95002 supplemental inspections.
2. Implement an efficient means for inspectors to readily identify and retrieve information about completed and planned corrective actions associated with 95001 and 95002 supplemental inspections.

Audit of NRCs Oversight of Supplemental Inspection Corrective Actions 10 An exit conference was held with the agency on September 9, 2019. Prior to this meeting, agency management reviewed a discussion draft. Agency management stated their general agreement with the finding and recommendations in this report and opted not to provide formal comments for inclusion in this report.

IV. AGENCY COMMENTS

Audit of NRCs Oversight of Supplemental Inspection Corrective Actions 11 Appendix A Objective The audit objective was to assess how NRC uses supplemental inspections to verify licensees corrective actions, and how NRC documents supplemental inspection results.

Scope The audit was focused on how NRC verifies licensee planned corrective actions associated with 95001 and 95002 supplemental inspections. OIG conducted this performance audit from January 2019 through July 2019 at NRC headquarters in Rockville, Maryland. Internal controls related to the audit objective were reviewed and analyzed.

Methodology To accomplish the audit objectives, OIG reviewed relevant regulations and guidance including

  • Title 10 Code of Federal Regulations, Part 50, Appendix B, Quality Assurance Criteria for Nuclear Power Plants and Fuel Reprocessing Plants.
  • Government Accountability Office, Standards for Internal Control in the Federal Government.
  • Inspection Procedure 95002, Supplemental Inspection for One Degraded Cornerstone or Any Three White Inputs in a Strategic Performance Area, dated February 9, 2011.

OBJECTIVE, SCOPE, AND METHODOLOGY

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  • Inspection Procedure 95003, Supplemental Inspection for Repetitive Degraded Cornerstones, Multiple Degraded Cornerstones, Multiple Yellow Inputs or One Red Input, dated December 18, 2015.

OIG conducted analyses to determine whether the agency uses supplemental inspections to verify planned corrective actions and document supplemental inspection results. OIG analyzed 25 95001 supplemental inspection reports issued from October 1, 2016 through December 13, 2018. Additionally, OIG interviewed NRC staff and management from the Office of Nuclear Reactor Regulation and Regional Offices to understand how the agency verifies planned corrective actions associated with 95001 and 95002 supplemental inspections.

We conducted this performance audit in accordance with generally accepted government auditing standards. Those standards require that we plan and perform the audit to obtain sufficient, appropriate evidence to provide a reasonable basis for our findings and conclusions based on our audit objectives. We believe that the evidence obtained provides a reasonable basis for our findings and conclusions based on our audit objectives.

Throughout the audit, auditors considered the possibility of fraud, waste, and abuse in the program.

Audit of NRCs Oversight of Supplemental Inspection Corrective Actions 13 The audit was conducted by Paul Rades, Team Leader; Avinash Jaigobind, Audit Manager; Ebaide Esoimeme, Senior Auditor; Chanel Stridiron, Senior Auditor; and Tonny Tang, Auditor.

Audit of NRCs Oversight of Supplemental Inspection Corrective Actions 14 Please

Contact:

Email:

Online Form Telephone:

1-800-233-3497 TTY/TDD:

7-1-1, or 1-800-201-7165 Address:

U.S. Nuclear Regulatory Commission Office of the Inspector General Hotline Program Mail Stop O5-E13 11555 Rockville Pike Rockville, MD 20852 If you wish to provide comments on this report, please email OIG using this link.

In addition, if you have suggestions for future OIG audits, please provide them using this link.

TO REPORT FRAUD, WASTE, OR ABUSE COMMENTS AND SUGGESTIONS

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