ML19323A304

Forwards Util Description of Licensee Activities Addressing Order Confirming Suspension of Const

ML19323A304
Person / Time
Site:	Marble Hill
Issue date:	03/04/1980
From:	Pope J PSI ENERGY, INC. A/K/A PUBLIC SERVICE CO. OF INDIANA
To:	Eyed J, Martin D, Mouser G KENTUCKY, COMMONWEALTH OF, KNOB & VALLEY AUDUBON SOCIETY, SASSAFRAS AUDUBON SOCIETY
References
NUDOCS 8004180223
Download: ML19323A304 (2)

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Charles W. Campbell Senior Vice President and General Counsel PUBLIC Greg K. Kimberlin SERVICE March 4, 1980

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INDIANA Duejean C. Garrett David L. Hardy James R. Pope Ronald J. Brothers Office of Attorney General Gregory A. Troxell neth.

n ugh Commonwealth of Kentucky ga i

Frankfort, Kentucky 40601 John B. Scheidler Attn.:

David K. Martin, Esquire w i,,,,

Mr. John A. Eyed, President Stephen Laudig, Esquire Sassafras Audubon Society 445 North Pennsylvania Street 10 O' clock Ridge Road Suite 815-816 Nashville, Indiana 47448 Indianapolis, Indiana 46204 Mr. George T. Mouser, President Thomas D. Dattilo, Esquire Knob and Valley Audubon Society 311 East Main Street of Southern Indiana Madison, Indiana 47250 P.O. Box 556 New Albany, Indiana 47150 Re:

Docket Nos. STN 50-546, STN 50-547 Gentlemen:

You have all, at one time or another, expressed an interest in the NRC's actions pursuant to the NRC's August 15, 1979 Order Confirming Suspension of Construction in the above captioned dockets.

I am, therefore, sending to you a copy of Public Service Company of Indiana, Inc.'s " Description of Licensee Activities Addressing Order Confirming Suspension of Construction" filed with the U.S. Nuclear Regulat ry Commission.

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1 l PUBLIC SERVICE l INDIANA February 28, 1980 S. W. Shields vice President - Electric Sys*em Mr. Victor Stello, Jr., Director Docket Nos.: STN 50-546 U.S. Nuclear Regulatory Coussission STN 50-547 Office of Inspection and Enforcement Construction Washington, D.C. 20555 Permit Nos.: CPPR-170 CPPR-171 Marble Hill Nuclear Generating Station, Units 1 and 2 Order Confirming Suspension of Construction Lear Mr. Stello: On August 15,19*/9, the U.S. Nuclear Regulatory Commission, Office of Inspection and 2nforcement, issued an order confirming suspension of safety-relate /. construction at the Public Service Company of Indiana, Inc. (PSI) Marble Hill Station. That order required, as a condition to the restart of construction, that PSI submit in writing under oath to the l Director, Office of Inspection and Enforcement, a description of its revised Quality Assurance Program and the steps taken to assure that safety-related construction will be conducted in accordance with 10 CFR Part 50, Appendix B. PSI has revised its Quality Assurance Program to be more effective. PSI has also prepared a report entitled " Description of Licensee Activities Addressing Order Confirming Suspension of Construction" which is appended to this letter. That report addresses each of the nine points in the Confirming Order, and includes a description of the revised Quality Assurance Program. PSI has taken positive steps to improve its organization and management capabilities, and the number and experience level of its on-site personnel. PSI has started a review and examination of the work in place. Results to date indicate such work is sound and acceptable. Further examination and testing are continuing as described in the attached report and if any deficiencies in such work are detected, they will be documented, evaluated and properly dispositioned. Uj. o\\ OO 3S M O-3b l 1000 East Main Street, Plainfield, Indiana-46168 317. 839.9611 l

l l , er PUBUC SERVICE INDIANA ) Mr. V. Stello, Jr., Dir. February 28, 1980 i PSI is confident that with the improvements in its organization and management capabilities, the Marble Hill Project will be completed in I accordance with its own high standards of quality and the regulations of the Nuclear Regulatory Consnission. l PSI hereby respectfully submits the attached report in response to the Commission's Confirming Order. PSI will promptly submit a request for permission to resume the first phase of safety-related work, along with its plan for doing so. Please advise me if you have questions or need additional information. Sincere S. W. Shields JB/kss Attachment cc: Mr. J. G. Keppler, Director U.S. Nuclear Regulatory Commission Region'III 799 Roosevelt Road Glen Ellen, IL 60137 E. R. Schweibinz, P.E. J. J. Harrison D

AFFIDAVIT i I, Seth W. Shields, hereby affirm that the material contained in this report " Description of Licensee Activities Addressing Order Confirming Suspension of Construction", is true and complete to the best of my knowledge and belief. f SETH W. SHIELDS Vice President - Electric System PUBLIC SERVICE COMPANY OF INDIANA, INC. STATE OF INDIANA ) ) SS: COUNTY OF HENDRICKS) Subscribed and sworn to before me this h [ M day of , 1980. i l l. 4 Notarf Public [/ My County of Residence: My Comission Expires: //-9.f2

l i i l DESCRIPTION OF LICENSEE ACTIVITIES i ADDRESSING ORDER CONFIRMING SUSPENSION OF CONSTRUCTION l i i i MARBLE HILL NUCLEAR GENERATING STATION r PUBLIC SERVICE COMPANY OF INDIANA, INC. DOCKET NOS. STN 50-546 AND 50-547 h e o c c - b o o *'a 7 g_ ul c1 / ] I o ( i

TABLE OF CONTENTS ?*S* r I. Introduction. I-l II. Revised Quality Assurance Program. 11-1 r III. Steps Taken to Assure Safety-Related Work III-l A. Review of Work Completed. III-A-1 B. Results of Independent Audit. III-B-1 C. Description of Staffing and Qualifications. III-C-1 D. Revies of Safety-Related Contracts.... III-D-1 9 E. Description of Deficiency Identification and Evaluation... III-E-1 F. Description of System to Halt Construction. III-F-1 G. Description of Inspection Planning. III-G-1 H. Description of PSI ASME Code Program. III-H-1 I. Description of System of Indoctrinatio'n. III-I-l f i l L

l l I. INTRODUCTION On August 8,1979 Public Service Company of Indiana, Inc., (PSI) stopped all safety-related construction work at its Marble Hill Project due to certain deficiencies in its Quality Assurance Program. On August 15, 1979, l the Director of the Office of Inspection and Enforcement of the NRC issued l an order confirming the work suspension (Confirming Order), which also set forth certain requirements for the resumption of safety-related work. These requirements consisted of a description of PSI's revised Quality Assurance Program and the steps taken to assure construction will be l carried out in accordance with 10 CFR 50, Appendix B. Since that time PSI has made major changes in the project which, PSI is confident, will provide i reasonable assurance that the Marble Hill Project, when completed, will meet applicable safety requirements. This report describes these major l changes and #.ncludes a description of PSI's revised Quality Assurance ( Program, as well as PSI's response to the issues set forth in the Confirming Order. PSI submits that the information contained in this report adequately addresses the concerns of the NRC. This report is organized so as to first summarize the revised Quality Assurance Program and organizational responsibilities. This is Part II of the report. Subsequently, the report addresses actions taken relative to specific concerns stated by the NRC in its Confirming Order of August 15, 1979. These concerns are addressed in Part III of this report and in the same sequence that they appear in the Confirming Order. e I 1 e i t i 1-1 f +

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l II. REVISED QUALITY ASSURANCE PROGRAM The following description of PSI's revised Quality Assurance Program is submitted in response to Part IV of the Confirming Order. Figure C-3 in Part III, Section C, of this report, shows the revised structure of the PSI Quality Assurance organization. 1. Organization The Vice President-Electric System (who reports directly to the President of PSI) is charged with the overall responsibility for the Marble Hill Project Quality Assurance Program. The Quality Assurance Manager reports directly to the Vice President-Electric System and is organizationally independent of cost and schedule considerations. The Quality Assurance Manager has the authority and responsibility to implement the necessary controls to assure i that the Marble Hill Project Quality Assurance Program meets all NRC requirements. The Manager Quality Engineering reports to the Quality Assurance Manager and is responsible for supervision, coordination and i direction of the discipline Superintendents Quality Engineering. He also maintains communication and coordination between the various Superintendents Quality Engineering and other PSI, contractor and supplier organizations. l The Superintendents of Electrical, Mechanical, Welding /NDE, and Civil (discipline) Quality Engineering are responsible for Quality Assurance matters within their disciplines. These responsibilities include: review and approval of PSI generated Purchase Documents; review of PSI Engineering Documents; preparation, review, and approval of PSI Inspection / Surveillance plans and procedures; and audits of the effectiveness of the practices, adequacy and performance of contractor and supplier Quality Assurance Programs. The Superintendents Quality Engineering report to the Manager Quality Engineering. The Superintendent Procurement Quality Assurance reports directly to the Manager Quality Engineering. He is responsible for i coordinating procurement related interfaces between the discipline Superintendents Quality Engineering, Superintendent Inspection, and suppliers and contractors. He maintains the Approved Supplier and Contractor List, and reviews supplier / contractor quality trends and reconsnends necessary corrective action. PSI activities related to the performance of supplier and contractor surveillance and receiving inspection is the responsibility of the Superintendent Inspection. He assures that j inspection and surveillance activities are performed by trained l and qualified personnel and that records resulting from inspection and surveillance functions are properly completad, legible and authenticated. He reports directly to the Quality Assurance Manager. j l l II-l

l Tha Suparintcndtnt Quality Syste=s is responsible for developing i and maintaining the Projcct End ASME Quality Assurance Manusls and supporting quality procedures. He provides quality related descriptions of changes affecting the SAR; provides for the training of PSI Quality Assurance personnel and provides input to the Training Coordinator for quality-related training for other project organizations; directs the activities of the Audit Coordinator who establishes the schedule for a comprehensive PSI Quality Assurance audit program utilizing qualified lead auditors i and cont'ract and PSI Quality Engineering personnel to assure applicable Quality Assurance criteria are audited at least annually; assures retrieval and maintenance of supplier and i i contractor Quality Verification Records; and is also responsible for establishing a Quality Assurance trending program to provide a management tool for statusing and trending nonconformances. The i Superintendent Quality Systems reports directly to the Quality Assurance Manager. 2. Quality Assurance Program The PSI Marble Hill Quality Assurance Program is described in the Project Quality Assurance Manual (PQAM) and applies to those activities which affect the quality of nuclear safety-related items, material and systems. The program includes contractor and supplier activities and services affecting quality or safety. Safety-related activities relating to the ASME Section III Code piping systems are conducted in accordance with the ASME Quality Assurance Manual (AQAM). The AQAM complies with the requirements of the ASME Boiler and Pressure Vessel Code, Section III, and, by reference, is part of and not in conflict with the PQAM. The Quality Assurance Manager is responsible for preparation, issuance, revision and control of the Marble Hill Project Quality Assurance Manual (PQAM) and the Marble Hill Project ASME Quality Assurance Manual (AQAM). The authority for these manuals stems from a policy statement endorsed by the President of PSI and included as part of each manual. Each section of the Quality Assurance Manuals is approved by the Project Director, the Quality Assurance Manager, and the Vice President - Electric System. The Quality Assurance Manager is responsible for distribution of t manuals and section revisions to assure that they are available at all locations where required. Distribution is made in accordance with a controlled distribution list to assure that controlled copies are maintained up-to-date. The Quality Assurance Program requires indoctrination and training of personnel performing safety-related activities to assure their understanding of the purpose, scope and implementation requirements of the PQAM and AQAM. Implementing instructions and procedures are included in training programs to assure knowledge of principles and techniques for specific activities being performed. The Quality Assurance Manager is responsible for the Quality Assurance indoctrination of PSI personnel who perform activities affecting quality. PSI's contractors and suppliers are responsible for developing and implementing programs for their II-2

personnal. These programs shall includa Qunlity Assurance indoctrinntion and training conuninsurata with their scopa of work. Indoctrination and training records shall be maintained as Quality Assurance Records, t PSI Quality Assurance organization has full authority to stop f further processing of items or materials by PSI or its suppliers and contractors; to identify quality problems; to initiate, recommend, or provide solutions; and to verify implementation of solutions. The individual stopping further processing is responsible for documenting the nonconforming condition on a Nonconformance Report or Corrective Action Request as i appropriate. Once further processing has been stopped, the organization responsible for the activity which was stopped shall not resume this activity until the conditions of the j Nonconformance Report or Corrective Action Request have been corrected or dispositioned and the PSI Quality Assurance Manager has provided documented authorization to resume processing. 1 The Quality Assurance Manager has the full authority to stop work of any PSI contractor or supplier organization which, in his ( judgment, must be stopped in order to correct poor quality trends or performance. This Stop Work Authority includes such things as a single process and broader scope activities such as entire design activities of an organization, installation activities of a contractor and fabrication or processing of PSI purchased i materials or items. The Quality Assurance Manager is responsible for orally stopping the work by notifying appropriate management in the affected organization. The stop work is documented on a Stop Work Order which is signed by the Quality Assurance Manager. Documentation of the Stop Work Order includes conditions or actions required prior to restart of the work. Once the conditions requiring correction have been acted upon and have been verified to be acceptable by the Quality Assurance Manager, he removes the Stop Work Order by signing the release portion of the Stop Work Order. Completed Stop Work Orders are retained as Quality Verification Records. The Vice President - Electric System is responsible for reviewing and evaluating the status and effectiveness of the PSI Quality Assurance Pr> gram. The primary elements of management participation are by review of Quality Assurance reports, and establishment of a Quality Assurance Review Consmittee (QARC) which holds meetings to review Quality Assurance Program activities. An l annual independent audit shall be performed at the direction of l the Vice President - Electric System which assesses the scope, implementation, and effectiveness of the Quality Assurance Program to assure that the program is meaningful, effectively complies with applicable codes, standards and regulatory guides and l effectively implements all elements of the Quality Assurance Program as stated in the PQAM. Reports containing the results of the audit shall be reviewed and appropriate action taken as directed by the Vice President - Electric System. \\ 4 II-3 l

( 3. Dasign Control j The Project Engineering Manager is responsible for design activities associated with the Marble Hill Project. The Project Engineering Manager assures that the classification of structures, systems, and components by safety classification, code classification, seismic category, quality group, and electrical classification, as applicable, are performed and documented. He i assures that classification of structures, systems and components is consistent with regulations, codes and standards as described j in the Final Safety Analysis Report. l PSI may subcontract design work but retains responsibility for the adequacy and completeness of the design and achievement of structural integrity. The design of the plant is defined in Engineering Documents, which consist of those specifications, procurement specifications, and drawings prepared by PSI or its design subcontractors which detail final design and define technical requirements of structures, systems, components, items, or materials. Changes to approved Engineering Documents are accomplished by one of the following methods: Direct change of the document in accordance with Sargent & Lundy Engineers (S&L) internal procedures. Issuance of an S&L Engineering Change Notice (ECN). Issuance of an approved Field Change Request (FCR). The responsibility for design verification is assigned to the organization responsible for preparation of the design. The j I verification process consists of design review by persons i independent of the document preparer, or alternate calculations, or verification testing of a unit. 4. Procurement Document Control j Procurement by PSI is accomplished through the utilization of a Purchase Requisition and a resulting Purchase Order or Letter of Intent followed by a Purchase Order. Reporting requirements l required by 10 CFR 21 shall be included or referenced in Purchase i Documents. PSI Procurement Documents identify, as a minimum, the necessary approved Engineering Documents and the Quality Assurance and documentation requirements. Purchase Requisitions are prepared for Quality Assurance approved suppliers or contractors and are reviewed by Quality Assurance personnel to assure inclusion of the appropriate quality requirements. Purchase Orders are prepared which incorporate the technical and quality requirements of the approved safety-related Purchase Requisition. Quality Assurance reviews and signs all Purchase Orders to assure that all the Purchase Requisition and Quality Assurance requirements have been included and that the supplier or contractor selected is approved. II-4

A Lettst of IntGnt ecy ba u:cd by tha Director of Purchesing cnd is utilized to provida cn initici centrcctuni commitment for tha Company prior to the issuance of a formal Purchase Order. Letters of Intent are handled the same as Purchase Orders and include the same Quality Assurance requirements. All Change Orders, including scope changes, are prepared, reviewed and approved in t.he same manner as the original Purchase Orders. l Change Orders for construction site additional work may be implemented through Extra Work Authorization Letters to site contractors to perform specific work under the conditions and requirements of the Change Order for additional work. When Extra

• Work Authorization Letters are employed, they are approved by I

Quality Assurance. 5. Instructions, Procedures and Drawings Marble Hill rquirements for Quality Assurance are set forth in the PQAM in sufficient detail to establish the key elements of control for implementing the Quality Assurance Program. Where necessary to expand on requirements of the PQAM in greater detail, this is accomplished by preparation of Project Management Procedures (PMPs). Project Management Procedures include implementing instructions for Marble Hill engineering, procurement, i construction, contract administration, project controls and i Quality Assurance. The PMPs are controlled documents and are i readily accessible and available for use. All PMPs are consistent with PQAM requirements and are approved by the Project Director and the Quality Assurance Manager. 6. Document control Project Documents which prescribe activities affecting quality will be controlled by the site Document Control Center. These documents are design drawings, design criteria, specifications, technical manuals, Project Management Procedures, and contractor procedures. The Project Engineering Manager has the overall l responsibility for implementing the methods and procedures of the Document Control Center. During the design, procurement, construction and construction test phases of the facility, the Document Control Center shall maintain a controlled file of documents distributed. The PSI Project Engineering Administrator i shall have administrative control over the site Document Control Center. During the course of the project, Project Documents i requiring distribution control shall be released by the Document Control Center. PSI Nonconformance Reports and supplier and contractor Quality Assurance Manuals are filed and maintained by Quality Assurance. These are controlled by Quality Assurance to assure they are updated and maintained current. Purchase Orders are issued by the PSI Purchasing Department and maintained in the permanent project files. II-5

l i 7. Control of Purchesad Meterial, Items cnd Sarvices l ihe PQAM defines requirements for the control of suppliers, contractors and subcontractors who are providing safety-related items, materials or services. Suppliers are those organizations furnishing items or materials to PSI. Contractors are those i organizations providing construction or installation services at the site. Subcontractors provide items or services to PSI suppliers or contractors. Quality Assurance has prime responsibility for assuring that suppliers and contractors comply with PSI's applicable Quality Assurance Program requirements. PSI suppliers and contractors are controlled directly by PSI through the establishment of Quality Assurance requirements in procurement documents and by PSI conducted audits, surveillance and inspections. The Quality Assurance Manager is responsible for assuring that procurement of f l items and services are controlled to assure conformance with PSI requirements. The effectiveness of the control of quality by suppliers and contractors is assessed by the Quality Assurance Manager at intervals consistent with the importance, complexity and quality of the item or service. Material shall be requisitioned, procured and received by PSI personnel in accordance with applicable sections of the PQAM for issuance to PSI contractors, except for code material for piping subassemblies. Code material for piping subassemblies shall be requisitioned, processed, and received by PSI personnel in l accordance with applicable sections of the AQAM for issuance to PSI contractors. 8. Identification and Control of Items and Materials [ The PQAH establishes requirements for identification and control of materials and items for the Marble Hill Project. PSI maintains i responsibility for identification, preservation and status of PSI purchased items up to the point the items are issued to site contractors, at which time the contractor's Quality Assurance Program continues the responsibility. This control is verified by PSI Quality Assurance through surveillance and audit. i The Project Engineering Mc 'ter it responsible for assuring Engineering Documents specify ' '*ntificati' requirements. The Superintendent Inspection is respou "..e ic determining the acceptance status of items and materias -c.'.ved, for marking or tagging the items and material, for follow-e: of nonconformances and for removing or changing tags when noncontarmances have been resolved and cleared. Quality Assurance personnel are the only personnel within psi authorized to remove or change inspection status tags. Records are maintained by Quality Assurance which show the inspection status of items received. 9. Control of Special Processes The PQAM provides measures for the control of special processes. Contractors and suppliers provide controls to assure qualification-II-6

of proesduras and parsonnal required to parform spscial i processes. These requirements are passed on to applicable subtier j contractors or suppliers by contract. l It is the responsibility of the Superintendent Welding /NDE Quality Engineering to certify all levels of PSI Nondestructive ( Examination personnel. Personnel may be certified by appropriate PSI Level III personnel or by a qualified outside agency. Certification records are maintained by the Superintendent Welding /NDE Quality Engineering. 10. Inspection The requirements and responsibilities for the control of inspection activities are defined in the PQAM. [ Inspection personnel are independent of the individual or group performing the activity being inspected. The Quality Assurance Manager is responsible for assuring that inspectors are trained, qualified and certified in the performance of their intended function and for maintaining these certifications current. The i Manager Quality Engineering is responsible for the preparation, review and approval of inspection plans and checklists which detail the inspections to be performed and appropriate accept / reject criteria. Project Management Procedures, inspection plans or checklists and necessary drawings and specifications will be available for use prior to performing inspection operations. Inspections will be performed under the direction of the Superintendent Inspection. Inspection results, inspector identity and date of inspection will i be recorded on inspection plans or checklists and become Quality Verification Records. 11. Test Control-Design, Procurement and Construction Phase Construction tests include such tests and verifications as cable f meggering, hydrostatic tests, motor bumps, flushing, component calibrations, functional tests and initisl energization of electric equipment. These tests verify the integrity of the construction contractor's work. The Quality Assurance Program defines a test control program to [ assure that all construction testing is identified and implemented. Quality Assurance surveillauce of construction I testing will be performed and will include: Verification that the item is ready for testing and the responsible contractor has verified that records are available. Verification that open nonconformances have been resolved or reviewed to assure no impact on the test. Verification that the tests are being performed in accordance with approved procedures. II-7

l Witnessing mandatory inspection or hold points. Written test procedures will be prepared by PSI and contractors for construction testing. Test procedures including those procedures prepared by contractors are approved by PSI prior to their use. Administrative controls of the Construction Test Program will be defined in Project Management Procedures consistent with PQAM requirements. Procedures prepared for the Construction Test Program will be of such scope as to meet the PSI commitments contained in the Final Safety Analysis Report, the Design Specification and the ASME Code. l The construction or installation of structurec, systems and components associated with the test will be completed to the degree that outstanding construction items could not reasonably affect the validity of the test results. This determination will be made and documented by review and evaluation of specific Construction Test Procedure requirements. A program for the safety tagging of equipment will be established and documented in r a PMP. During testing, measuring and test equipment used will be calibrated in accordance with approved procedures. Approved and completed test documentation will be retained as Quality Verification Records. I 12. Control of Measuring and Test Equipment The PQAM provides for the regularly scheduled calibration and control of measuring and test equipment used by PSI and the preparation and maintenance of calibration records. Procurement of measuring and test equipment and celibration services will be from suppliers and organizations approved and qualified by Quality Assurance to supply equipment and calibration services. Each instrument will be assigned and marked with a unique identification number prior to calibration and initial use. In instances where it is not feasible to so identify an instrument, l the container for the instrument will be identified and care will be exercised to insure that the instrument remains with its container. A Master Equipment List will be maintained to show equipment calibration and recall cycle. Controls will ensure that measuring and test equipment has an uncertainty (error) of no more than 1/4 of the tolerance of the parameters being measured unless limited by practical limits of the state of the art. Equipment calibration will be against certified equipment or transfer standards having known valid relationships to nationally recognized standards. If no national standard exists for a specific instrument, the calibration standard used will be approved by Quality Assurance and documented. Inspection and testing equipment which is found to be out of calibration will be reported on a Nonconformance Report. The acceptability of items measured with that instrument since its last valid calibration will be reevaluated. II-8

Calibratica procedures ced records will ba caintcinsd as Quality Verification Records. 13. Handling, Storage r.ad Shipping l The requirements and responsibilities for handling, storage and shipping of safety-related items and material purchased by PSI are defined in the PQAM. L l Special handling, preservation, storage, cleaning, packaging and shipping requirements are identified in Engineering Documents. These documents are reviewed by Quality Assurance prior to use to l determine that acceptance criteria have been included. Surveillance of site storage and handling activities is performed by Quality Assurance to assure required controls are implemented. l Instructions needed to identify how PSI controls these activities are provided in PMPs. Site contractors are informed of special handling, preservation, storage, cleaning and packaging l requirements as described in Engineering Documents and manufacturers' special instructions as appropriate. Special work procedures will be required for items which need special handling because of weight, size, susceptibility to shock l damage or other conditions which warrant special handling. Provisions will be provided for certification and use of hoisting equipment and inspect.on of handling equipment and rigging i consistent with ANSI N45.2.2 and Regulatory Guide 1.38. l l Instructions will identify controls required to minimize the possibility of damage or degradation of the quality of items due to corrosion, contonination, deterioration or physical damage. Records of storage. handling and control and issuance of items in PSI custody will be maintained by PSI Material Control Management. Similarly, such records will be maintained by site contractors for items under their control. Where special preservation and storage requirements are necessary, records will be traceable to the item. Surveillance and audit of storage, i handling, and issuance of items will be performed to assess the adequacy and effectiveness of these practices. 14. Inspection, Test and Operating Status I L PSI maintains identification and status of PSI purchased items and equipment from the time it is received at the site until it is issued to site contractors. The identification and status controls of suppliers and site contractors are monitored through approval of their procedures and by surveillance and audit. The l Quality Assurance Manager is responsible for assuring that a controlled system of stamping, tagging, marking, labeling, and/or segregating storage of material, items and equipment is implemented. The system also provides a means for identifying the l status of systems and components involved in tests during the l construction phase. This system identifies the status of those items received and stored by PSI. II-9

l i

15. Nonconforming Materials cnd Items The PQAM defines the system for control of nonconforming materials or items on the Marble Hill Project.

It defines measures established to control the identification, documentation, segregation, review, disposition, and notification of responsible organizations in the event of nonconformance. Each employee is responsible to bring any questions he has to the attention of Quality Assurance about the conformance of any materials, items or processes to requirements specified in Engineering Documents. The ultimate responsibility and authority for assuring quality rests with the Quality Assurance Manager. Disposition of all PSI-reported nonconformances is subject to approval of both Project Engineering and Quality Assurance. Nonconforming items and materials are segregated from acceptable items and materials and identified as discrepant. If, because of f bulk, size, and weight, physical segregation is not possible, tagging or roped off areas may be an acceptable substitute for segregation. Contractor and supplier-reported nonconformances which are dispositioned "Use as is" or " Repair" are required to be formally reported to PSI for review and approval by PSI Project l Engineering and Quality Assurance. For those PSI nonconformance l reports and contractor reported nonconformances which are dispositioned "use-as-is" or " repair", a periodic analysis is t l provided by a trending program. For those contractor nonconformances which are dispositioned " replaced" or " reworked", a periodic audit is performed by PSI i Quality Assurance. This audit provides additional information to management relative to quality trends. l In addition to the disposition instructions, completion of the i "Cause" section and " Corrective Action" section of the NCR is required. It is the responsibility of the dispositioning organization to provide and fully implement the " Corrective Action." Quality Assurance is responsible to sign off PSI Nonconformance Reports when all work is complete and acceptable. When repair is required, the PSI Quality Assurance Inspector shall assure that retests, reinspections and reexaminations of the materials / items meet the applicable requirements. A periodic analysis of Nonconformance Reports is pr ovided by a trending program. This program provides managemen' with infonaation relative to quality trends. A computer printout is j used to assure all Nonconformance Reports are clored and provide a log of Nonconformance Reports. Follow-up of noneruformances based on trending data will be performed. Nonconformance Reports are reviewed by Quality Engineering for determination if the report condition is "Potentially NRC Reportable". A "Potentially NRC Reportable" ranking may be made when a nonconformance or discrepancy appears to meet the II-10

requirem nts for raporting in accordsnee with Nuclear Regulatory Commission regulations: 10 CFR 21 - Reporting of Defects and Noncompliances 10 CFR 50.55(e) - Significant Deficiencies If a "Potentially NRC Reportable" rank is determined, a copy of the NCR is forwarded immediately to the Marble Hill Safety Review Committee for further evaluation. The Marble Hill Safety Review Committee will review the deficiency within twenty-four hours, and if the deficiency is determined as reportable, the NRC will be promptly notified. Whenever the Marble Hill Safety Review Committee does not have sufficient information to classify a potentially reportable deficiency in a period of twenty-four hours, preliminary notification to the NRC will be made. The Marble Hill Safety Review Committee will promptly acquire the needed information so that classification may be accomplished, and follow-up notification to the NRC provided. A written report will be submitted to the NRC as required by 10 CFR 21 and 10 CFR 50.55(e) within the specified time frame. All reports concerning potential and actual reportings of deviations, significant deficiencies and safety hazards will be controlled and maintained as quality verification records. l 16. Corrective Action i The PQAM defines requirements for corrective action. It details the documented measures utilized to assure that significant conditions adverse to quality such as failures, malfunctions, deficiencies, deviations, defective material and items, and other nonconformances are promptly identified and corrected with action taken to preclude repetition. Nonconformances and discrepancies that relate to procedural br'akdowns or documentation deficiencies or represent deviations from engineering requirements on items and materials not in PSI custody will be documented on a Corrective Action Request. Nonconformances and discrepancies that represent deviations from Engineering Document requirements on items and materials in PSI custody will be handled by initiation of a Nonconformance Report. The evaluation of nonconformances and determination of need for corrective action is accomplished in accordance with Project Management Procedures. Corrective action will be initiated and follow-up reviews accomplished to verify both proper I implementation of corrective actions and close out of corrective action documentation. Adverse conditions significant to quality, the cause of the conditions and the corrective action taken will be reported to appropriate levels of management. The PSI trending and tracking program provides follow-up and timely action for corrective action by providing a 10-day overdue notice printout for construction site Corrective Action Requests and a 30-day printout for supplier Corrective Action Requests. II-11 i 1

The printout shs11 ba cecomplished on a weakly basis cnd distributed to cppropriate lins arnagem;nt. The Quality Assurance Manager conducts trend analysis reviews of nonconformances of PSI supplier and contractors to identify conditions which are adverse to quality. The Quality Assurance Manager reports the results of this review in writing to the Vice President - Electric System. 17. Quality Assurance Records The PSI PQAM defines requirements for Quality Verification j Records. It establishes methods and responsibilities for controlling Quality Verification Records at PSI General Headquarters, the Marble Hill nuclear plant site and the remote storage areas. Suppliers or contractors prepare and maintain Quality Assurance Records as required by ;*ocurement documents, applicable codes and standards. PSI is respensible for maintaining records required for Quality Assurance, construction, fabrication, manufacture, and installation of asterials or items. Records include documentat sa of materials, manufacturing, personnel i qualification =, procedures, specifications, design reports, drawings.nd test data. The Quality Assurance Manager assures j that all records are maintained at the PSI Quality Assurance l Records facility or at contractor or supplier facilities, if required by Procurement Documents, for a period of five years after completion of the item, but not less than two years after commercial operation of the plant. Quality verification records are classified as either " Lifetime" or " Nonpermanent". " Nonpermanent" records will be retained for a limited period of time to show evidence that an activity was performed in accordance with applicable requirements. " Lifetime" records will be retained for the service life of the plant or the lifetime of the item or material in serv *ce,== applicable. i i Supplier and contractor quality verification record packages for i items and materials are stored and maintained in accordance with a PMP which describes the records filing system. The records filing system includes indices which assure a complete record of Project Documents entered into the plant index files. These indices are updated as required and will indicate the document revision and date to assure th,e,most current revision is identified. The indices are of sufficient detail and quality to provide ready retrieval of all project documents. 8 Records which provide documentary evidence that items or materials i conform to requirements will be maintained at the plant site prior to installation or use of the item or material. Record storage facilities will be constructed at the site to comply with ANSI N45.2.9. In the interim, duplicate copies of records are maintained at the site and at PSI GHQ, except for nonduplicated documents, such as radiographs, which are stored at PSI GHQ. f II-12

Hcrd ccpy rscords are plcesd in foldsrs, cnvelopas or othat cppropriate enalos':res for protection cgsinst tears or cbrasions i received while i aorage. Special processed records which are light, pressure, cemperature or humidity sensitive are packaged and stored as recommended by the manufacturer of these materials or other industry accepted standards.

18. Audits b

The PQAM defines requirements for audits. PSI uses a comprehensive system of planned and periodic audits to assure the implementation and effectiveness of the overall Quality Assurance Program. Audits are performed of activities affecting quality within contractor, supplier and PSI organizations. The Superintendent Quality Systems is responsible for the planning, scheduling, assigning of audit responsibilities and tracking of audit status, except for those audits directed by the Vice President - Electric System. Audits of the entire PSI program are conducted at intervals not exceeding one year. Audits may be conducted without advance notice. All elements of supplier and contractor Quality Assurance Programs will be audited at least l annually or once within the life of the activity, whichever is shorter. Audits are conducted under the authority of the Quality Assurance Manager and are performed and reported by personnel not directly responsible for the activity audited. Personnel performing audits may be selected from Quality Assurance, PSI technical personnel, or may be consultants. In no case will the person selecting the auditors nor the auditors themselves have any direct responsibility for the performance of the activities being audited. Lead auditors will be certified in accordance with a documented qualification program in accordance with ANSI N45.2.23 on the qualification of lead auditors. A program for examination and for certification of lead auditors is maintained. Audits are performed using individual audit plans which describe the audit scope and detail. Audit plans are developed by the audit team leader and approved by the Audit Coordinator. l Individual implementing checklists are also developed and approved to ensure depth and continuity of audits. Checklists provide for i recording of specifies such as procedure numbers, documents reviewed, general findings and comments. i l Each audit covers selected elements of the Quality As.surance l Program. Examination will be of the depth necessary to assure that quality elements are being performed effectively. When there is indication that a nonconformance or program deficiency may exist, detail will be explored to determine the extent and nature of this finding. Nonconformances or program deficiencies fcund during a preaward survey are evaluated in the same manner a9 audit findings. At the conclusion of each audit, a post-audit conference is held with management of the audited organizr. tion. The audit findings including supporting details are diseassed and documented. II-13

Audit rspcres cro prspared and signcd by tha cudit teen Icedar. Audit r: ports includa en svaluation stettment regarding ths effectiveness and quality trends of the Quality Assurance Program elements which were audited as well as specific nonconformances, deviations or program deficiency findings. The audited organization is required to respond in writing with commitments, stating the actions taken or to be taken and completion dates. Follow-up actions including reaudit, if necessary, will be conducted in the deficient areas. Completed audit checklists, finding lists and reports are retained and filed i as quality verification records. j Independent Quality Assurance audits for management (management audits) are the responsibility of the Vice President - Electric System. These audits are performed to verify and evaluate the status and effectiven:ss of the Quality Assurance Program. Management audits are performed through a review of audit results, corrective actions and results or reaudit verification. Management audits are conducted by personnel who do not report to the Quality Assurance Manager. Management audits are conducted on an annual or more frequent basis and are documented by formal reports., These formal reports will be provided to the Audit Committee of the PSI Board of Directors. t f a i t i I i II-14

III. STEPS TAKEN TO ASSURE SAFETY-RF.I.ATED WORK The Confirming Order states that the Director, Office of Iaspection and Enforcement, will consider certain specific NRC concerns. The following sections, A through I, of this report address these items individually. I l9p III-1

A. REVIEW OF WORK COMPLETED Item (1) of Part IV of the Confirming Order is whether and the extent to which PSI has: Reviewed the work completed as of the date of this order to determine whether the Licensee's quality assurance program was adequate to assure such work was properly l performed and described what repairs, if any, are required. i PSI has developed a comprehensive integrated program which, l when completed, will provide assurance that the work already i completed at Marble Hill is sound and meets applicable safety requirements. This program consists of the following: Material Verification Program l Construction Verification Program Nonconformance Review Any deficiencies or nonconformances identified through these I i programs will be properly dispositioned. 1. Material Verification Program The purpose of the Material Verification Program is to l establish confidence that receipt inspection of material received at Marble Hill prior to August 15, 1979, was performed properly and that the material is acceptable. This program, directed by the PSI Quality Assurance Manager, consists of the following: a. Identification of Items to be Reinspected. A review of receipt inspection records was [ performed to identify kinds and quantities of Safety Category I material received at Marble Hill. Characteristics internal to components and others not readily verifiable upon receipt are a part of the vendor surveillance program and will e not be verified in receiving inspection. A statistically valid sampling inspection will be conducted using sample sizes to provide ninety-five percent (95%) reliability with a ninety-five percent (95%) confidence factor. Any nonconformance identified upon reinspection that had not been previously dispositioned properly in accordance with Criterion KV of Appendix B will be l evaluated by Project Engineering and Quality l Assurance. The sampling program dictates the requirements for increasing the sample size. l l III-A-1

b. Sampling Method Installed components cannot be fully inspected for i all characteristics identified for reverification. Consequently, samples will be taken from warehouse quantities, laydown areas, and items stored in place, but not installed. If the sample discloses l a nonconformance, a technical evaluation will be made of the impact and necessary repairs, if required, will be performed. If discrepancies are identified in specific items, one hundred percent l' (100%) of such installed items shall be evaluated for the same discrepancies. PSI Quality Engineering will approve the sampling method [ appropriate to each item as a part of the inspection checksheets. Inspectors' Qualification Requirements c. t Inspections will be performed by personnel qualified to Level I and Level II per ANSI N45.2.6. Where Level I inspectors are used, they will perform to written checksheets giving discrete i accept / reject criteria and under the direct supervision of a Level II inspector who will review [ the results and attest to the correctness of such l results. d. . Inspection Planning f The reinspection of previously accepted items will be performed to inspection checksheets approved by i PSI Quality Engineering. The checksheets will identify the item, the sample size, the sampling method, the characteristics to be verified and the method of inspection and will provide a means of l documenting the inspection. Inspection planning will be prepared by PSI or contract personnel qualified to ANSI N45.2.6 Level II or Level III. e. Inspection Results Upon completion of the reinspection of previously i accepted items and documentation, the results will be made available to the.NRC. l t III-A-2

2. Constructicn Verification Program a. Scope In order to prove the structural integrity of in place concrete at Marble Hill, a nondestructive examination of the concrete was performed on a statistical basis. A statistically valid sample of areas representing congested and noncongested ^ locations in the structures was examined using i pulse-echo and through-transmission testing methods. Results of the examinations are presented in the S&L Engineers Report, " Evaluation of In-Place Concrete, Marble Hill Nuclear Generating Station, Units 1 and 2", dated November 20, 1979. This report was presented to the NRC on December 19, 1979. Based on the S&L report, it is PSI's conclusion that the quality of concrete in the structures at Marble Hill meets specifications and is therefore acceptable. In order to further prove the acceptability of the existing safety-related construction at Marble Hill, PSI is conducting a Construction Verification Program. This program is based on a combination of records review and physical inspection. Acceptance criteria are based on specified design and quality requirements. Nonconforming work discoveres through the Verification Program will be properly documented and dispositioned in accordance with existing procedures and proper adjustment of the sample size will be made. b. Organization Performance of the work in the field will be the responsibility of the PSI Construction Manager. The PSI Project Engineering Manager is responsible for providing technical support to the entire program. Physical inspection will be performed with the aid of verification teams. Establishment of the verification teams shall be the responsibility of the Construction Manager with the concurrence of the Project Engineering and Quality Assurance Managers. Each team will consist of a team leader and a crew of inspectors. The team leader shall be an engineer who satisfies one of the following requirements: i. Bachelors degree plus one year experience in the discipline being inspected, or l l III-A-3

I ii. Fiva yacrs expsrience in the disciplina being inspected. The team leader is responsible for the performance and scheduling of the verification, but he shall not be responsible for the recording and approval of data. Each verification team will contain at least one PSI Quality Assurance Inspector, assigned by Quality Assurance and qualified to Level II under ANSI N45.2.6. Other inspectors from PSI or contractors qualified to Level I may be assigned to the team as necessary. All recording of data shall be under the direction of the PSI Level II Inspector. c. Verification Procedures Construction verification will be performed in accordance with procedures prepared by S&L engineers and approved by PSI Project Engineering and Quality Assurance. These procedures will include acceptance criteria based on specified design and quality requirements. d. Items of Verification The following items of verification will be performed as part of the Construction Verification Program: i. Surface Concrete i Visible Category I concrete surfaces will be visually examined in a systematic manner to identify, locate and document all concrete I patches and unrepaired concrete surface defects. Formed areas will be identified for evaluation by the NRC where forms are not to be removed prior to restart. i t ii. Reinforcing Steel Visible installed Category I reinforcing steel will be examined to determine if placement is adequate to satisfy design requirements. i Reinforcing bar size, number, and cover are items which will be checked. The detail to which these items will be checked will be consistent with the stage of installation of l reinforcing steel in a particular area. l III-A-4

iii. Structural Staal Category I structural steel will be examined to verify that the following items comply with design requirements. (a) Member sizes, including the detection of missing members. (b) Bolted connections including: bolt material, size, count, and tightness, and l the existence of correct washers. l Torquing of one hundred percent (100%) of I all structural joints that had not been previously documented by U.S. Testing Co. will also be tested and a statistical sample providing ninety-five percent (95%) reliability at a ninety-five i' percent (95%) confidence level will be tested on joints that had been so documented. The torquing is as required by specification; a minimum of two bolts per joint to a maximum of ten percent f (10%) will be torqued unless a rejection j is made, in which case the sample size is i increased. (c) A documented visual check will be made to assure member configurations are in I accordance with design drawings. iv. Piping and Hangers The following items will be examined for l Category I pipe and hangers which have been i installed: l f (a) Installation Records (including NDE f Records) and Drawings (b) Weld Procedures i (c) Visual examination of installed l configuration and location i ~ In addition, a welding inspector qualified as Level II under ANSI N45.2.6 will be assigned to visually inspect separate statistical l samples to provide ninety-five percent (95%) l reliability with a ninety-five percent (95%) r confidence factor of both completed piping and l completed hanger attachment welds. v. Liners and Category I Tanks l l l III-A-5 1 I

Tha wald records and NDE raperts for tha containment liner, spent fuel pool liner, fuel j transfer canal and field fabricated Category I tanks will be examined in separate statistical i samples to provide ninety-five percent (95%) reliability with a ninety-five percent (95%) confidence factor to verify the integrity of these structures. i vi. Verification of Cadwelds This verification consists of inspecting a statistical sample to provide ninety-five i percent (95%) reliability with a ninety-five percent (95%) confidence factor of exposed cadwelds. The inspection includes: i ~ (a) A visual check for porosity and l inclusions in the surface of the cadweld l material. l (b) A check for recess at the ends of the cadweld sleeves. vii. Verification of Backfill i Engineered backfill in Safety Category I areas l will be verified by reviewing one hundred I percent (100%) of records on testing of backfill to insure that testing was done and l uonconformances were doctamented per l specification requirements. A computer plot will be made showing sections a various elevations and locations and restits of testing. i e. Reports All data sheets from the construction verification activities will be forwarded to the Project l Engineering Manager. The S&L engineers responsible for writing the verification procedures will be responsible for preparing a report for each item of l verification. These reports will be approved by the Project Engineering and Quality Assurance Managers and submitted to the NRC. l 3. Nonconformance Review i Subsequent to the issuance of the Confirming Order, PSI reviewed Nonconformance Reports issued by or submitted to PSI at the Marble Hill site prior to the date of the Confirming Order. (As used herein a Nonconformance Report is a generic term including, but not limited to, Nonconformance Reports, Field Corrective Action Requests, and Deviation Control Records.) The III-A-6

Nsuconform:nes Rsports on file w2ra review 2d by membars of.?SI's Project Engineering, Construction and Quality Assurance Staff. If any reviewer questioned the l disposition of a Nonconformance Report, that Nonconformance Report was transmitted to the Design Control Supervisor Site or to the Quality Assurance Manager for further disposition. A review showed that of approximately 2700 reports listed on the logs, 33 reports were not on file. Of these, 31 reports had been voided. Research is continuing to locate the other two i reports. Many of the Nonconformance Reports which were sent to the Design Control Supervisor Site involved concrete l l patching. All of the Nonconformance Reports sent to the Design Control Supervisor Site have been reviewed by the Design Control Supervisor Site and/or S&L and have been or will be properly dispositioned or will be repaired or dispositioned after the restart of safety-related work. j Except for those Nonconformance Reports associated with concrete work, none of the closed Nonconformance Reports represented unacceptable materials or conditions. l The Nonconformance Reports sent to the Quality Assurance l Manager for review were mostly due to lack of adequate documentation. These Nonconformance Reports have been reopened and are being reviewed by PSI Quality Assurance. Any deficiencies will be corrected. PSI is confident that its revised Quality Assurance Program, as described in Part II of this report, will minimize such documentation problems in the future. It was determined that there was a certain amount of confusion as to the use of the various types of I Nonconformance Reports, and that many times inadequate l descriptions of deficiencies were included in the Nonconformance Reports. In order to correct this, PSI has eliminated some types of Nonconformance Report forms and has simplified others. In addition, more detailed training and indoctrination is scheduled for all i personnel 2n the future as described in Part III, Section C,1, b, iv of this report. III-A-7

B. RESULTS OF INDEPENDENT AUDIT Item (2) of Part IV of the Confirming Order is whether and the extent to which PSI has: l l Conducted a review, using independent management consultants where appropriate, of the licensee's project management and quality assurance programs to determine { whether these are adequate to exercise full control over i all aspects of the Marble Hill project, and submitted the results of that review, the recommendations for l revision to the existing programs, and the schedule for implementing the recommendations. 1. Selection of Management Analysis Company l l PSI retained Management Analysis Company (MAC) of San i Diego, California to conduct a diagnostic of the Marble i Hill Project. PSI elected to retain MAC for this analysis after making a telephone survey of several utility executives and other executives in industries involved in large construction projects, including members of the Construction Committee of the Business Roundtable. MAC was highly recommended by a number of those contacted. Further interviews with MAC revealed l that they had performed six previous diagnostic evaluations of nuclear power generating projects and that they had a number of personnel with many years of i experience in commercial nuclear power. The MAC team which performed the PSI diagnostic evaluation, consisting of 10 people, had a combined 130 years of commercial nuclear experience. On October 2,1979, MAC j issued its diagnostic report on the Marble Hill Project, ~ a copy of which was previously furnished to the NRC. f 2. MAC Audit and Results l a. Audit The purpose of the diagnostic was to measure the overall quality assurance and management l effectiveness of the following organizations t participating in the project -- PSI; S&L; the civil / structural contractor, Newberg Construction Company; the piping and mechanical contractor, Cherne Contracting Corporation; and the electrical I contractor, Commonwealth-Lord J.V. The MAC evaluation began on the 20th of August 1979 and was complete by the end of September. The formal l l III-B-1 i

1 rspert w n isaued to tha manrgemsnt of PSI on I October 2, 1979. The MAC team interviewed over 60 j l people in the participating organizations, reviewed ( policy, procedure and instruction manuals, examined I the construction site a number of times, visited the replicate base plant (the Byron project) and physically examined receipt inspection, t t engineering, and quality assurance documentation, both at the Marble Hill site and the General l Headquarters of PSI. The MAC team spent approximately three weeks evaluating the interview notes, the written material that it had collected, i and che observations from its visits to the t constraction site and produced and reported on October 2, 1979 an evaluation of the situation at Marble Hl11. j b. Results f The Category 1 concrete problems that led to the suspension of construction were primarily a result of insufficient commerical nuclear experience l within PSI and its contractors. The concrete problems primarily involved workmanship. It was brought to MAC's attention that at that time the inspection and technical analysis of existing concrete was underway to determine if there were any significant safety problems. After necessary i repair work has been defined and carried out under the guidance of experienced and qualified construction and quality assurance personnel, the plant should meet nuclear standards. The existing i personnel, when supplemented with sufficient experienced personnel and more effective management tools, can in the future manage and complete the Marble Hill Station within a reasonable time and at a reasonable cost. The MAC review resulted in numerous general and specific recommendations which were intenaed to improve the overall management and control of the project, as well as the Quality Assurance aspects of the job. The disposition and the schedule for implementation of each recommendation is presented below. 3. Revised Project Organization The major recommendations made in the MAC report were to l reorganize the project to provide additional management l controls, to provide additional experience in the l organization, and to relocate certain functions to the site. The new organization is shown on Figure B-1. Relocation to the field was completed on January 7,1980. l III-B-2

In order to establish the additional experience in the field organization, an integrated organization was developed. Selected critical positions either have or [ will have both a MAC and a PSI individual in the job. r The initial experience, and the direction of the [ specific function, will come from the MAC person. Because PSI would have a difficult time obtaining, on i short notice, the numbers of experienced people that are required, PSI contracted with MAC to obtain qualified people to place on the site as quickly as possible. MAC has been able to collect highly qualified and experienced people at the site, and they are already functioning in the critical areas of project management and quality assurance. These people will direct the work of individual functions as required by PSI and subject to PSI's ultimate authority. They will assist PSI in the implementation of both a restart plan and an overall project plan. They will train PSI personnel i and, as PSI obtains the necessary experienced and j qualified personnel for its own staff, the MAC personnel will depart. This phase out will be accomplished in a manner such that the quality of construction management i and the quality of the project will not be endangered. l PSI expects that full phase out cannot occur before a year's time but should be completed within a three year l period. The NRC and Authorized Nuclear Inspector (ANI) will be notified prior to release of such contract personnel at supervisory levels. The reorganized Marble Hill Project offers several advantages which will improve the overall management of the job. An experienced Project Director, reporting directly to Vice President - Electric System, has been provided to coordinate the varied aspects of the job. i An experienced Quality Assurance Manager with construction experience has also been provided. This manager is located in the field and directs the Quality Assurance aspects of the project. He reports to the Vice President - Electric System independent of other project management. Additional details of the Quality Assurance organization are discussed in Part II and Part III, Sections C, E, F, G, and H, of this report. An experienced Construction Manager has also been provided. This individual is responsible for construction activities and will have reporting to him experienced Area Managers for turbine building, auxiliary building, containment building, and general facilities. The major emphasis of the construction group will be planning of work with contractors. Additional supervisory positions have been added and additional experience is being provided as noted in Part III, Section C, of this report. III-B-3

A position of Project Control Manager has also been established and experienced personnel are being assigned. This individual will be responsible for the integrated project planning, scheduling, and cost development efforts and provide cost and schedule l support to the Area Construction Managers. Additionally, the Project Control Manager will be responsible for the material management program which is intended to assure proper handling, storage, and maintenance of equipment and materials on the job. 4. Schedule for Implementing Recounsendations The MAC diagnostic made a total of 52 recommendations, both specific and general. The resolutions of each of I these recommendations, and in the appropriate cases the schedule for implementation, are presented in the following material. l t i l i I s 4 k i L e = 1 III-B-4

RECOMMENDATION RES01,UTION CENERAL RECOMMENDATIONS These general recommendations are positive steps that PSI can take which will assist in improving the timely and cost-effective construction of the Marble Hill Generating Station with the requisite quality. These are based on MAC's assessment of Marble Hill and are as follows: A. Changes in Project Management A Project Manager should be established for Completed. (See Figure B-1). Personnel for both Marble Hill reporting directly to the Vice Project Director and Quality Assurance Manager are on President-Electric System. He should have all site. activities reporting to him with the exception of Quality Assurance. It is also recommended that a seasoned Quality Assurance Manager be hired for the Marble Hill Project. g Uj, B. Quality Assurance d It is recommended that the Quality Assurance Restructuring has been completed. (See Part III, organization and program be restructured and Sections C, E, F, C, and H, of this report.) staffed with experienced personnel. The Subsequent evaluation has indicated a need for objective is to provide a " hands on" QA additional personnel. Recruiting additional people management team that is structured to emphasize is underway. A PSI Quality Assurance Manager and the importance of preplanning of activities to Manager Quality Engineering have been hired and will maximize problem prevention. Present staffing report approximately mid-March. numbers at the requisite experience levels are more than adequate to operate the QA function effectively. 1 I l

RECOMMENDATION RESOLUTION CENERAL RECOMMENDATIONS C. Experience and Staffing Levels Specific areas in the project organization have Personnel for Project Director, Construction Manager, been identified as needing increased staff. Quality Assurance Manager, Project Control Manager, and Experienced personnel must be brought into key Project Engineering Manager are in place. (See Part positions to strengthen the project team. This III, Section C, of this report.) can be accomplished by hiring key personnel in certain areas and by supplementing existing PSI personnel with experienced consulting support personnel on an as-needed basis. D. Management Focus Due to the significance of the Marble Hill Completed. Monthly or more frequent meetings are being project to the overall financial picture of PSI, held. Critical items list has been developed. it is recommended that the President and Vice g [ President-Electric System attend a monthly site 8 meeting that focuses on overall project status, definition of problems, and establishment of a key action list. E. Centralization of Activities at the Site There is a need to relocate some forces and Personnel relocation completed as of January 7, 1980. functions from the headquarters offices in Plainfield to the crnstruction site. This need is primarily in the areas of cost and schedule, material control, document control, contract administration, and Quality Assurance / Quality Control.

RECOMMENDATION RESOLUTION GENERAL RECOMtENDATIONS F. Bryon Liaison It is recommended that the benefits of the Liaison has been established; evaluation of a permanent replication approach be emphasized through the assignment is progressing. assignment of key personnel at the Byron site to provide early information on any problems and the as-built configuration. G. Activity Integration A project of this magnitude and complexity Integration of cost and schedule has begun with the requires closest coordination.and integration to decision to utilize the PREMIS program as the minimize cost and schedule. It is recommended scheduling resource tool. Computer hardware support that the use of a scheduling resource tool such has been on site since December. Initial data input as'the PREMIS program (presently in existence at began in January with preliminary output reports PSI) be expanded to utilize its full capability integrating cost and schedule to be available by in integrating the activities of PSI, S&L and March. Revisi*ns to the material management program, s U major Contractors. Additionally, it is including modifications to Purchasing, Inventory, and Es recommended that the material management program Expediting system (PIE), are currently under ds as presently structured around the existing PIE evaluation. Revisions to PIE began in January. system be further expanded and developed into a more effective management tool.

RECOMMENDATION RESOLUTION CENERAL RECOMMENDATIONS H. Financial Controls and Management Reports Financial controls associated with contractor Existing financial controls associated with contractor change orders and contract administration should change orders are being evaluated to determine what be improved. It is recommended that a full-time changes are necessary. A PSI auditor has been assigned t financial auditor be assigned to the site. An to the site. Contract Administration is being staffed. evaluation should be made for potential Improvements to document control and design change improvements in management reports, document control have been made. Management reports are being l control and design change control. developed. 1 I. Effective Use of Fixed Price Contracts The fixed price approach utilized by PSI has An organization chart has been developed along with a solid merit for controlling costs. Fixed price staffing plan for the Construction Contract contractors tend to place their best personnel on Administration section. This section reports to the s U the job and labor tends to be more supportive. Construction Manager and will include the following de To derive the maximum benefits of the fixed price classifications: Construction Contract Administrator, E construction contracts in the environment *of Contract Administrators, and Contract Coordinators. The constant change, PSI should investigate breaking Construction Contract Administrator is scheduled to be down the scope of existing contracts into smaller in place in February. Additionally, this effort will,be i elements and aggressively monitoring them at the supported by Project Control through the establishment site by more experienced personnel augmented by of the project Work Breakdown Structure (WBS) and the contracts administration people. Significant integration of cost and schedule to provide a basis for nuclear experience in contract monitoring and effective monitoring of contract progress. (See Part administration is a necessary ingredient to III, Section C, of this report for the Construction handling changes and minimizing cost and schedule Contract Administration Organization.) impacts. A larger staffing level is required to effectively accomplish this. i

RECOMMENDATION RESOLUTION SPECIFIC IMPLEMENTING RECOletENDATIONS In order to derive maximum benefit from the general recommendations, the following specific implementing recommendations are suggested: A. The Project Manager's effectiveness can best be Organization is in place as shown in Figure B-1. maintained with an organization such as shown in Figure 1, Project Management Organization. B. The functions of contractor administration and Functions have been created and are being staffed. project auditor should be created and staffed Project auditor is on-site. Contract Administrator is with suitable personnel on site. PSI project on the project; augmentation of his staff is progressing. financial reporting practices should be reviewed and appraised with respect to adequacy to meet management's need for appropriate information for [ decisions. 'i' j8 C. Activity integration can be best achieved with the following steps: 1. Revise Master Schedule, validate and A Master Schedule is being developed. integrate Engineering, Materials, Construction and Startup. 2. Put CRT's and printer in field. The cost / schedule processor has been installed in the field as of December 1979. Five Cathode Ray Tubes (CRTs) and one printer are currently committed for PREMIS/PICOM use.

RECOMMENDATION RESOLUTION SPECIFIC IMPLEMENTING RECOMMENDATIONS 3. Establish area system of controls. The establishment of mid-levels of project WBS identi-fying area monitoring elements has been completed. In addition, Project Control has identified "sub" organizations for Area Project Control consisting of area cost engineers and schedulers. 4. Combine the cost system with PREMIS. PICOM, a cost processor, was procured December 3, 1979. PICOM/PREMIS are compatible programs and will combine via a WBS approach. The project WBS is currently being designed. 5. Outline specific management reports. Marble Hill will initially use the standard PREMIS/PICOM Reports. Should a special request require additional reporting capability, PREMIS can easily be modified to y accommodate this request. Y gs 6. Develop a six-month action plan. (See An action plan has been developed. (See Section E.10 g Section E.10 below) below). 7. Redefine the weekly coordination meeting. Weekly coordination meetings are being held; appropriate control guidelines for these meetings are being developed.

RECOMMENDATION RESOLUTION SPECIFIC IMPLEMENTING RECOMMENDATIONS 8. Transfer the PIE is currently being analyzed by the Material Procurement-Inventory-Expediting (PIE) Management Group. Modifications to PIE are dependent on system to the field and integrate with the project WBS. Steps are currently underway to PREMIS. Revise PIE procedures to make it operate PIE on an interim basis until modifications to more useful. PIE have been completed. The direct integration of PIE and PREMIS is not planned at the present time; however, the utilization of PIE will be coordinated with that of PREMIS. D. Because of the importance of the Marble Hill Risk analysis is currently underway. project to the overall financial picture of PSI, risk analysis appraisals should be initiated by PSI management. These appraisals would be initiated by a revalidation of cost and schedule activities using probabilistic techniques. Based s M on those results, a series of contingency plans $s should be prepared for a series of possible total d. costs. The impact of the proposed Capital Cost Recovery Act should be included in the analysis. Likewise, a series of contingency plans should be prepared for delayed startup dates as indicated h; *he risk analysis. E. Iv-stiffing and developing the project rnrnrasstion, the following issues should be w%2 + -red: 1.

?LI should continue its re-evaluation of The following changes have been made in the overall salaries for project personnel.

PSI should compensation plan: consider revising its overtime policy and special site pay (relocation and/or per (i) An overtime pay policy for exempt employees has dien) for exempt personnel who are required been instituted. This plan is intended to to work extended overtime because of address non-incidental overtime needed to conditions beyo'nd their control. complete the regular duties of a position. Such overtime normally occurs on a construction site like Marble Hill.

RECOMMENDATION RESOLUTION SPECIFIC IMPLEMENTING RECOMMENDATIONS (ii) A shift pay program has been instituted for exempt and semi professional employees assigned to the Marble Hill Construction Project. This program is intended to address sporadic shift work which typically occurs during the construction and startup activities of a large construction project. (iii) An additional construction site pay allowance program has been revised and extended to include all non-bargaining unit employees assigned to PSI station consF;uction sites. (iv) A comprehensive relocation expense allowance program has been instituted to address the special circumstances involved in relocating employees to the site. H U (v) PSI exempt and semi professional employee bs positions"have been re-evaluated against an d industry survey of salaries and adjustments were made to match industry practices. The above changes compensate PSI construction andesite assigned employees for the additional demands of field construction work and allows PSI to be competitive in attracting and holding the experienced employees needed to pursue the project.

l RECOMMENDATION RESOLUTION l i SPECIFIC IMPLEMENTING RECOMMENDATIONS l 2. MAC believes that the major effort of the The Construction Management Organize. tion has been j Construction Engineer should be in the reorganized to incorporate the area concept of I preplanning of the work with the management and separate contract administrators. This contractors. The purpose of this plan is to separation of construction management and contract identify potential problems, interpretation administration allows the construction engineers to l of requirements, control points, etc. This devote their efforts to preplan the work with the permits a unified approach which is contractors and identify and resolve potential problems. beneficial to all concerned. The area team must be intimately involved with the Construction Contract Administration personnel will be contractors and should look ahead to assigned to each area to follow the daily construction minimize problems. activities of the various contractors to verify compliance with the terms and conditions of the ' specifications and purchase orders, drawings, safety requirements and project rules and regulations. The area concept is being implemented for the containment s M building, auxiliary building, turbine building, and d, general facilities. (See Figure C-5.) b 3. Hard drawings, specific.ations and reference A reference library has been established as part of the books (codes and standards) should be more construction management trailer offices. Hard copy readily available to the PSI construction drawings, specifications and references are maintained staff. there by Document Control.

l RECOMMENDATION RESOLUTION SPECIFIC IMPLEMENTING RECOMMENDATIONS 4. Improved formal and informal routine Home office project personnel have been relocated at communications must be established between the project site to improve communications. In the PSI site and home office. Reports addition, PSI senior management visits the site weekly, should include a "look ahead" aspect in addition to "where we are" and "this is what The basic philosophy of the newly-formed Project we have done" approaches. The reports Control Organization is to provide timely information should include overall project status, to the appropriate individuals to support effective quality trends, significant events, decision making. The e, blishment of a project work potential and actual problem areas and their breakdown structure, work packages, and the integration recommended or completed resolutions, along of cost and schedule, coupled with PREMIS/PICOM, will with responsible personnel and timetable for provide the capability to evaluate performance to date resolution. and project the impact of this performance on cost and i schedule. The Quality Assurance Program provides management with quality trend information and a listing of action items. U 7 5. There is a need to train everyone on the job Training / Indoctrination program is currently being y in his area of performance and on the designed. It is scheduled to begin in February, 1980. E necessity of a commitment to quality. This That training required to support a specific activity includes personnel such as clerks, will be in place prior to start of that activity. (See pipefitters, junior engineers, and managers Part III, Sections C and I, of this report for further and should be done in a manner which will information.) improve their effectiveness. It is suggested that a formal training and indoctrination program be given to each employee before the site is started up and then on a continuing basis.

t r. REC 0t94ENDATION RESOLUTION SPECIFIC IMPLEMENTING RECOt9(ENDATIONS 6. A Material Controls organization should be A material control organization has been establaihed established on the site under the PSI under the new project organization and is presently Construction Management organization. This being implemented, organization will handle all procurement, expediting, and materials problems associated with Marble Hill. After the purchase order is issued, the responsibility of the control of the material should rest with this organization. It should provide total control of the material including documentation, equipment quality verification, storage, preventive maintenance and vendor payment releases. All construction Contractors should identify specific PSI supplied material requirements U for work packages well in advance of the 7 construction activity. Material schedules Y should be updated and maintained current. U; The present system should be expanded to incorporate all material and equipment brought on the site. The program should be exoanded to include construction and startup spares and have provisions to add operational spares. Institute use of PIE in the field with the use of CRTs.

RECOMMENDATION RESOLUTION SPECIFIC IMPLEMENTING RECOMMENDATIONS 7. Due to the volume of changes, it appears The Construction Contract Administrator organization has contract administrators should be assigned been established and is being staffed. The Contract to each contract to administer changes in Administrator will provide the necessary support to the the field. Arrangements should be made construction organizations. (See Part III, Section C, which improves PSI control over changes. of this report.) 8. PSI should initiate a study of the design change system with particular emphasis on the following: a. Use of a single design change form for Simplification of forms has been accomplished as part of field generated changes regardless of the revised Quality Assurance Program. whether they originate with PSI or contractors. Uy b. Utilization, if possible, of the PSI-unique form will be used as specific organizations j8 existing form employed by Byron such need to be addressed in the'use of the form. g that approved Byron changes can be utilized directly on Harble Hill. 9. Establish a project planning and scheduling This function has been established and is operating as a control organization in the field which part of the Project Control Organization. includes the functional elements of Planning, Scheduling, Cost Engineering, Estimating, Data Management and Material Control. l

RECOMMENDATION RESOLUTION SPECIFIC IMPLEMENTING RECOMMENDATIONS 10. Develop an immediate interim plan which will An interim action plan addressing these issues in ( carry the project for the next six months appropriate levels of detail was developed and while the detail staffing, planning, implemented as the mechanism to status and control the schedule and controls are established. Tha progress of these activities. Longer range plans interim plan should deal with such issues addressing these issues in detail have been or are being l as: organizational structure, personnel developed and implemented on a priority basis. assignments, site facilities, construction restart (including analysis of existing concrete and any necessary repai work), re-inspection of safety-related work as necessary, project procedures and controls, cost and schedule estimate and risk analysis, material control systems, Byron liaison, NRC reviews, a total long-range project plan, and executive reviews. s 11. The restructuring of the site organization The Project Management Manual (previously called the i8 with appropriate definition of job authority Construction Management Manual) is being rewritten in [ will establish clearer lines of accordance with the recommendations. 4 responsibility and authority, and eliminate the present duplication of QA/QC functions and construction engineering function. PSI should rewrite their Construction Management Manual and clearly define the goals and objectives such that they are structured and provided with the necessary procedures to control the project without duplication with QA/QC. Responsibilities should be clearly establsihed for processing of changes, planning / scheduling, contract administration, material management and engineering. F. The required improvement in the Quality Assurance organization and programs would be enhanced with the following specific recommendations:

RECOMMENDATION RESOLUTION SPECIFIC IMPLEMENTING RECOMMENDATIONS 1. Reunite the Quality Assurance and Quality Completed. (See Part III, Section C, of this report Control functions under one qualified for Quality Assurance Organization.) manager located at the site. A suggested j organization is shown in Figure 2, Quality Assurance Organization, of the orginal MAC report. 2. Review and assure understanding of the PSI This item has been addressed as a part of the revision Quality Assurance charter and its role of to the PSI Quality Assurance Program and Manual. conceptually managing the quality assurance ef fort s of the A/E, NSSS suppliers and on-site contractors. 3. Establish a program for iornal QA on-site This is a provision of the revised PSI Quality revie's of contractor quality programs. Assurance Program. s U ds 4. Provide guidance to contractor organizations This is being accomplished through ongoing meetings and 1 in quality achievement, but neither preempt reviews of contractors personnel, work procedures, nor relieve contractor responsibility for training programs, and periodic evaluation of achieving and verifying the quality required performance. under the contract. 5. Clearly define the uninhibited authority of This is a part of the revised Quality Assurance PSI Quality Assurance to stop the Program. (See also, Part III, Section F, of this performance of unsatisfactory work. report.) 6. All NRC - exit interviews should include key This will be pursued with the NRC as issues relative to contractor personnel involved in the audit. a given contractor arise where such participation might be beneficial. 7. QA/QC manpower ceilings should be maintained A staffing plan has been developed to provide Quality s at their current level except for a planned Assurance / Quality Control manpower. Contrary to this program of upgrading personnel to achieve a recommendation, higher levels of manpower will be greater exp'erience level. required. ..--m e -s-. v

RECOMMENDATION RESOLUTION SPECIFIC IMPLEMENTING RECOMMENDATIONS 8. As QA manual sections and procedures are The PSI Quality Assurance Manual has been rewritten and revised to reflect changes brought about by simplified. reorganization and by reactivation of Category 1 construction, include as a goal the simplification of procedures and provision of clear definitive instructions on how PSI Quality Assurance performs its work. 9. There is a need to have piping isometrics This item is under evaluation. reviewed by the A/E to reduce the possibility of errors in A/E drawing interpretation, errors in installation, interference, snubbing and support. g Consider requiring the piping fabrication y and installation drawings be reviewed and a signed by the A/E for conformance to 4 design. Determine by surveillance and audit that such reviews and approvals have been made. 10. PSI Quality Assurance should review with Recommendation is being implemented. contractors their procedures for preparing inspection planning and checklists to assure that adequate definition of accept / reject criteria is provided and to assure that the completed document will be satisfactory for a quality assurance record, including identification of the inspector and verification that required quality was attained. ,, _ _ ~,. -.,,,. .m.

1 RECOMMENDATION RESOLUTION SPECIFIC IMPLEMENTING RECOMMENDATIONS 11. Establish a centralized document control at The site Document Control has been established and is the site with the responsibility of located in suitable facilities. New equipment for receiving, distribution, and Jispensing all storage and reproduction has been delivered to the technical project documents, and for site. A majority of the S&L drawings have been assuring that proper reviews and approvals delivered to provide a base and to back-fit site files, have been accomplished prior to release for Procedures will be implemented covering the controlled identifying proper drawing and specification issuance and review of project design documents. status for assuring, through a receipt mechanism or similar process, that the correct revision has been distributed to and received by the using organization. 12. Establish a manual filing capability for QA Quality Assurance records will be filed at the site. records at the site. Identify required Checklists are being prepared to identify required [ quality records and establish suitable quality records. Microfilming will not be postponed but 7 controls to assure their adequacy upon will continue after documents are processed initially. Y receipt or completion and their integrity, These fiche will constitute the plant records. E$ safety, and security. Postpone the microfilming of QA records until after plant acceptance. 13. Utilize the current lull in construction to This effort is in progress, evaluate all record packages where the hard copies have been destroyed to determine if there are any documents that are not clearly readable when reproduced from microfilm / microfiche. Initiate a program for the replacement of any such illegible records while supplier / contractor originals are still available.

RECOMMENDATION RESOLUTION SPECIFIC IMPLEMENTING RECOMMENDATIONS 14. Discontinue the practice of enhancing The practice of enhancing contractor documents has been contractor documents for reproduction discontinued as of August 9, 1979, by Quality Assurance purposes. Require prompt replacement with Records Reviewers. Replacement of documents that are acceptable reproducible documents. not of microfilm quality has been initiated. 15. Initiate a program of interfacing with other Determination of Quality Assurance / Control hardcopy utilities or with records managment experts records storage and required facility requirements has to determine staffing facility and equipment been initiated and will be in accordance with ANSI requirements for document control and N45.2.9 and other applicable codes. Engineering records storage. Document Control has been organized as part of Project Engineering at Marble Hill. Other utility engineering document control programs have been evaluated and the procedures to be used at Marble Hill are being developed utilizing this input. U Personnel currently on-site with experience in records 7 management have evaluated the PSI corporate records Y system. As a result, the compliation of permanent U records will continue to be accomplished utilizing the PSI microfilming system. The capabilities of the basic system allow for any modifications which may be identified to improve filing and sorting requirements.

RECOMMENDATION RESOLUTION SPECIFIC IMPLEMENTING RECOMMENDATIONS 16. Reassess the storage program with assigned A storage maintenance program is being implemented under responsibility for a storage maintenance Material Management Section. Project Engineering is program. Expedite receipt of component providing explicit storage maintenance requirements, manufacturers' instructions for storage Quality Assurance is establishing a surveillance program maintenance. Institute a QA surveillance based on those requirements, program to assure requirements are met. 17. Establish an on-going program of reducing The cognizance of quality problems will be achieved all significant probiens to a QA action through the re-establishment and use of a quality list. The review of the action list should trending program. (See Part II of this report.) be an important adjunct to weekly QA meetings, wi?.h schedules updated and The trending report provides a listing of open items referrals made to appropriate levels of including nonconformance reports, corrective action [l management to accomplish the action. The reports, and audit findings which provide an action item 7 key objective is to retain cognizance of a list for the Quality Assurance Manager relative to Y problem until it is finally resolved, quality problems. U 18. Establish the quality trend analysis program The cognizance of quality problems will be achieved as an integral part of the management through the re-establishment and use of a quality information system, trending program. (See Part II of this report.) I l t 1 l l i --n

RECOMMENDATION RESOLUTION SPECIFIC IMPLEMENTING RECOMMENDATIONS G. Contractors 1. General Prior to a restart of safety-related work on This contractual review has been partially completed. Marble Hill, two actions should be taken with respect to the contractors. A general Commitments to the Quality Assurance Program are review of contractual commitments should be satisfactory with the exception that the implementation made to define in detail the commitments of of stop-work authority in some instances is not the contrac' tors to implementation of the QA sufficiently defined. Contractors are being directed to Program. This should specifically address make the necessary corrections. staffing levels, qualifications and number and level of work instructions required to Review of contractor's staffing levels, qualifications support the crafts. An in-depth quality of personnel, and work instructions is being conducted. [ assurance audit should be conducted on each Where deemed inadequate, the contractors are being 7 major contractor to evaluate their overall directed to correct these inadequacies. Y QA programs. E$ Quailty Assurance audits on U.S. Testing, Cherne, and Newberg have been completed. U.S. Testing's audit reply with corrective action will be completed in February. Cherne'r, and Newberg's audit replies have been compiered. Some of Newberg's audit items remain open and are being evaluated. Cherne's audit reply is satisfactory. Prior to start of receipt inspection activities, audits of staffing levels, qualifications, procedure i preparation and training relative to receipt inspection l activities will be performed by PSI. These audits will be conducted on each site contractor and subcontractor receiving and inspecting safety-related items in order ro verify readiness to commence receipt inspection in I cc.pliance with PSI commitments. In addition, audits of site contractor and subcontractor Quality Assurance programs will be conducted to assure that the Quality Assurance Program of each site contractor and subcontractor is acceptable prior to unrestricted release to perform safety-related work.

i l RECOMMENDATION RESOLUTION I SPECIFIC IMPLEMENTING RECOMMENDATIONS I t 2. Newberg As a result of the contractual review and 1. A joint review of work procedures has been audit noted above, a determination of action initiated between Newberg and PSI Construction items required prior to restartup should be Management, Project Engineering, and Quality made and documented. The action list should Assurance in accordance with priorities necessary include all QA requirements as well as any to start work, additional project management requirements and should be pursued in weekly meetings 2. A program is being initiated to requalify welders which include the Project Managers and QA and cadwelders. Managers of both PSI, Newberg, and MAC recommends that Newberg continue to acquire 3. Quality Assurance and Quality Control personnel supervision with nuclear experience and staff is being increased. New personnel have provide additional training in placement of been added and are being trained for Level II Category 1 concrete. This program must be qualification. A Manager of Power Construction s d expanded to develop detailed training for has been added to the organization reporting to de crafts personnel in areas for which they ere Newberg's Vice President, and is assigned full 5 going to participate in the placement time to the site. A new labor Superintendent has activities. been assigned and a new Project Manager is in place. 4. Concrete placement crews are being trained prior to placements in the specific requirements of each work procedure. / 5. Newberg will utilize PSI training media relative to the importance of quality, the uniqueness of the Marble Hill facility, the importance of Title 10, Code of Federal Regulations, Part 21 reporting and the capability of reporting quality 3. Cherne and Commonwealth-Lord problems without recrimination. Cherne and Commonwealth-Lord QA programs Cherne and Commonwealth-Lord will be monitored were looked at in detail. With the closely under the revised Quality Assurance Program, exception of the review and approval. problem associated with Cherne isometric drawings, there is not a notable QA problem. These contractors should be monitored closely, however, as they are in the early stages of Program implementation. j

VICE PRESIDENT ELECTRIC SYSTEM PROJECT PERSONNEL DIRECTOR l VICE PRESIDENT PROJECT DIRECTOR 7 AS U E CONSTRUCTION ENGIN5ERING M GER = .T Tu CONSTRUCTION PROJECT CONTROL' PROJECT PROJECT ADMINISTRATOR MANAGER MANAGER R REVISED PROJECT metic ORGANIZATION SERVICE INDIANA FIcURE B-1 AS OF 2-80 ~

j C. DESCRIPTION OF STAFFING AND QUALIFICATIONS Item (3) of Part IV of the Confirming Order is whether and the extent to which PSI has* Described the number, qualifications, and experience of the Licensee's quality assurance, quality control, and engineering and construction management staff broken down by construction j activity, the degree to which contract staff will be utilized for i these activities, and the relationship between the quality assurance and quality control staffs and their responsibilities. l As identified by the NRC and in the MAC diagnostic, the major cause of j the construction difficulties was lack of nuclear experienced personnel. This section addresses PSI's staffing and experience levels as of June 1979, the date of the first cessation of Safety l Category I work, and the plan to upgrade both experience and numbers of personnel to the point where safety related work can be resumed in l accordance with 10 CFR 50, Appendix B, and better overall management control can be provided. PSI has also determined that, in order to add additional assurance of l the overall quality of the construction at Marble Hill, it would be i beneficial not only to increase the experience level of its Quality Assurance Organization, bur also the experience level of its project i staff. PSI also determined that this overall experience could most l effectively be utilized through a restructured organization. A brief description of the project staff, as reorganized, as well as a discussion of the project staff's experience level follows: 1. Personnel Plan t a. Prior Organization Prior to shutdown, the PSI organizations were as,shown on Figures C-1 and C-2. Prior personnel qualifications are shown on Tables C-1 through C-4. j L_ b. Plan to Correct i i. Reorganization With some minimal changes to meet specific job site l requirements that have been encountered, PSI is implementing the organization structure reconenended by MAC's independent review. The project has been reorganized as shown in Figure B-1. This organization j structure has significant advantages over the prior j organization. The assignment of a Project Director and a Quality Assurance Manager reporting to the Vice President-Electric System assures the identification and timely response to project needs in both areas of project management and Quality Assurance. Descriptions of the components of the new organization and their functions follow. III-C-1

(1) Project Mnntgemsnt cnd Quslity Assurance Organizations The key positions of the organization are the Project Director, Quality Assurance Manager, Construction Manager, Project Control Manager, Project Sagineering Manager, and Project Administrator. f The Project Director will coordinate the varied aspects of the project except for Quality Assurance and will report directly to ins Vice President - Electric System. The QuJitty Assurance Manager directs the Quality Assurance i Program and also reports directly to the Vice President - Electric System. i The functions of the remaining positions and their l respective organizations are discussed in the j following subsections. I (2) Quality Assurance Organization i The functions of Quality Assurance and Quality Control organizations have been reunited under one manager and relocated to the site. l The Quality Assurance organization as shown on Figure C-3 consists of three separate quality assurance functions; namely, inspection, quality engineering and quality systems. 1 Inspection performs source inspections at suppliers' facilities, receipt inspections of material and equipment shipped to the job site, I and surveillance and inspection of storage conditions and construction activities at the job site. This organization is responsible for documenting inspections and identifying unacceptable work and material and stopping further processing of unacceptable work. The surveillances and inspections performed by this organization are conducted in accordance with inspection plans prepared by Quality Engineers. l Quality Engineering reviews technical requirements, identifies characteristics to be inspected, prescribes inspection methods and quantities to be inspected, and documentation methods. Quality Engineers assure adequate definition of accept / reject criteria in all documents by review and comment on drawings, specifications, and contractor procedures. Quality Engineers participate in the verification and disposition of nonconformances and their l I III-C - -_

crumas, tnd the datcrmination of tha nacd for corrective action. The Quality Systems Group is responsible for the preparation of the Quality Assurance Program, preparation of bnplementing procedures for the Quality Assurance organization, performance of l l Quality Assurance audits, review and maintenance l l of records, and tracking, trending and reporting of quality deficiencies. The functions and responsibilities of the Quality Assurance organization are defined in more detail l in the description of the revised Quality f Assurance Program in Part II of this report. l (3) Project Engineering Organization The Project Engineering function has been reorganized as shown on Figure C-4. This new organization provides Laproved support to the Construction Management Organization, improved methods of handling design changes, and additional l numbers of people to support the project. The S&L Engineering Group provides an on-a.te group from the design organization to review, i evaluate, and approve design changes which arise from construction interfaces. This on-site group can be further supplemented by the architect-engineer as the needs ari's and is l supported by the architect-engineer'- staff by normal communications channels. The Design Engineering Group is rerponsible for I the design overview within PSI for the project. This group's responsibilities include interfacing l with S&L and equipment suppliers and the l coordination and resolution of special problems. The Nuclear Safety and Licensing Group provides licensing support for Project Engineering. This includes preparation and coordination of Safety t Analysis Reports, coordinating architect-engineer efforts relative to licensing and acting as the l primary contact with the Nuclear Regulatory Commission project management. The Nuclear Safety and Licensing Group is also responsible for maintaining cognizance of the applicable codes and l standards for the Marble Hill Project. i The Project Engineering Administration Group provides clerical services to Project Engineering and administers site document control. III-C-3

(4) Construction Mrntgemsnt Orgtnizction The Construction Management Organization has been reorganized as shown on Figure C-5 to incorporate the area concept of management and contract administration. This separation of construction management and contract administration allows the l construction engineers to devote their efforts to l preplan the work with the contractors and identify and resolve potential problems. The Construction Manager has Area Construction l Managers reporting to him and each is assigned one l of these specific areas: turbine building, auxiliary building, reactor building and general l facilities. The Resident Field Engineering Group is provided to give support, by discipline to the ares l managers. This group will receive and process contractor change requests and other field generated engineering-related documents, disallow those which are inappropriate, and coordinate the balance with Project Engineering. i The Contract Administration function has been instituted as a part of the Construction Management Organization. The function will l include: direction of administration, monitoring, and auditing of architect-engineer and Prime i Contractor activities for contract performance. The Systems Turnover Group will manage construction testing, master completion list and system turnover to operations. l I The Construction Staff Manager will assist the Construction Manager in the administrative functions, such as staff coordination, staff augmentation, contractor prepared procedure review I and correspondence control. r (5) Project Control Organization The Project Control Organization, as shown on Figure C-6, is comprised of three (3) main sections: Planning / Scheduling / Cost, Area Control and Material Management. l The Project Planning / Scheduling / Cost Section is charged with the responsibility of providing viable project planning, control and j cost / management systems. f III-C-4

The Arce Control Ssetions cra orgtnizid by usjor construction areas, (i.e., auxiliary building, reactor building, turbine building, and general facilities) and are comprised of both cost engineers and construction schedulers. These groups are charged with the responsibility of providing the PSI Area Construction Managers with the cost and schedule support. The Material Management Section has the basic objectives of providing an organization and system to monitor, review, and modify all planned activity on a component or item to make certain l that material and equipment is properly stored and maintained. In addition, this section provides material control support to the project. (6) Project Administration The Project Administration function as shown on Figure C-7 provides assistance to the project in the areas of procedural support, facilities l support, pc unel support and general l administrative support. ii. Personnel Qualification Requirements PSI has reviewed and defined the personnel l qualification requirements, both in experience and in l education, for the project. Additional staffing is being implemented based on these qualifications. iii. Staffing PSI's approach to increasing experience level of the f project management and Quality Assurance staffs is as follows: i (1) Reassignment of Personnel Quality Assurance personnel experience is being reviewed against required training and experience levels needed for qualification; only persons qualified in accordance with ANSI N45.2.6 will be t placed in those positions performing verification i of quality. In functions not covered by ANSI N45.2.6, PSI has reviewed personnel qualifications and has reassigned personnel to positions l commensurate with their experience. Where appropriate, other personnel will be trained to qualify for positions in the overall Marble Hill organization or reassigned to other positions l within PSI. III-C-5

(2) Hiring of New PSI Psrsonn21 Recruiting of additional personnel is being accomplished through the use of personnel placement services, PSI personnel recruiters, executive search firms and media advertisements. (3) Use of Contract Personnel PSI has upgraded its current level of experience through the use of contract personnel. Selected positions have been staffed with qualified MAC personnel who are managing certain key functions [ and the recruiting, hiring, and training of qualified PSI counterparts. The key positions in i project management and Quality Assurance are being l staffed with qualified MAC and PSI employees. l It is planned that during the term of MAC's involvement on the project, the PSI counterpart in each of these positions will be indoctrinated to assume the project responsibilities. Specific plans for implementing this transition will be developed. The NRC and ANI will be notified prior 3 to release of such contract personnel at supervisory levels. l l Contract personnel will be used in other areas of i the project to supplement existing staff as needed. iv. Training i PSI is developing a comprehensive training program. This program is intended to supplement the technical expertise of project personnel in specific areas, to provide f amiliarization in project procedures, and to i indoctrinate project personnel in site rules. The program will also provide documentation of training. PSI now has on-site a Training Manager and a Training Coordinator. The Training Manager reports directly to i the Project Personnel Director who reports to the Vice i President - Electric System. The Training Manager is also supported by an educator on contract to PSI for assistance in the development of the training program. It is anticipated that the training function will be reassigned to Project Administration at a future date. The first level of training will consist of indoctrination for all site personnel. This aspect of the program vill cover such typical topics as: Importance of Quality Nonrecrimination aspects of reporting III-C-6 i

z I Tha sacond loval of trcining will consist of training and indoctrinatica for PSI projact cud Qunlity Assurance personnel. This portion of the training i I program will include the following* i Teaching programs for individuals who will instruct other project individuals i i Indoctrination in Project Management Procedures i Indoctrination in the PSI Quality Assurance Program f The third level of training will consist of job ( specific training for appropriate groups within the l project. This portion of the training program will l include the following typical topics: j Construction practices Quality Assurance inspection procedures ASME Code requirements i This training, program will be updated periodically as I the project proceeds to meet specific needs which have i t been identified. Training in some areas, such as Quality Assurance inspection procedures, has begun. l The trainin's necessary to support specific activities l' will be in place prior to the start of those activities. 2. Numbers, Qualifications, and Experience of Project Personnel Tables C-1, C-2, and C-3 have been developed to show June 1979, l January 1980, and projected levels of staffing for restart. Table C-4 has been developed to show experience summaries for PSI staffing as of June 1979, PSI and contract stelfing as of January 1980, and projected PSI and contract staffing required to support start of installation activities. The staffing shown in the January 1980 column will support the start Jf PSI receipt inspection activities. The projected staffing will support the start of installation activities. Full coastruction activities will be supported by additional staffing as required after restart. PSI Construction staffing has increased by a factor of 1.3; when contract staffing is included, total Construction staffing increases by a factor of 1.9. PSI Construction staff experience has increased by a factor of 1.9; when contract staffing is included, the total Construction experience increases by a factor of 4.2. This total includes construction support functions such as training and staff management. III-C-7

PSI Engintsring staffing hcs remninsd the sama; whtn ccatrcet staffing is included, the total Engineering staffing increases by a factor of 1.6. PSI Engineering experience has decreased by a factor of 1.1 due to transfers of personnel to other positions in field -organizations. When contract (S&L) experience is included, the total Engineering experience increases by a factor of 1.8. PSI Quality Assurance staffing has increased by a factor of 1.2; when contract staffing is included, total Quality Assurance staffing increases by a factor of 1.4. PSI Quality Assurance experience has increased by a factor of 1.2; when contract experience is included, the total Quality Assurance experience i increases by a factor of 1.7. [ PSI project staffing has increased by a factor of 1.2; when contract staffing is included, the project staffing increases by a factor of 1.6. PSI project experience has increased by a l factor of 1.2; when contract experience is included, the project experience increases by a factor of 2.3. This level of experience includes experienced project administration and project control functions which are not a part of the direct construction function. I 1 III-C-8 1

TABLE C-1 PROJECT DIRECTOR AND CONSTRUCTION PERSONNEL Projected Staffing Required to Support Start of Staffing Staffing Installation As of 6/1979 As of 1/1980 Activities Contract PSI Applic. Applic. Applic. Exper. Exper. Exper. Contract PSI Position No. Educ. (Yrs.) No. Educ. (Yrs.) No. Educ. (Yrs.) No. No. Project Director 1 B.S. 5 1 P.E. 15.5 1 0 Construction Manager 1 H.S. 4 1 H.S. 17.5 1 0 Area Managers 1 H.S. 23 1 H.S. 27 1 1 Turbine Building Uy Auxiliary Building 1 B.S. 3.5 1 B.S. 8 1 B.S. 4 1 1 ? Reactor Building i B.S. 2.5 1 it. S. 3 1 B.S. 3 1 1 e General Facilities 1 B.S. 4 1 H.S. 9 1 B.S. 4.5 1 1 Civil Engineers 7 B.S. 13 1 B.S. 7 7 B.S. 16.5 3 5 Mech. Engineers 4 B.S. 7 4 2 H.S. 35.5 5 B.S. 9.5 4 6 1 B.S. 1 Assoc. Deg. Elect. Engineers 4 2 B.S. 20.5 5 2 H.S. 23 3 4 2 H.S. 2 B.S. 1 Assoc. Deg. 1 H.S. 4 0 1 Const. Train. Coord. 1 B.S. 8.5 0 1 Residant Engineer Resident Engineers 2 B.S. 5 0 4 1 H.S. 22 1 0 Const. Staff Manager

TABLE C-2 PROJECT ENGINEERING PERSONNEL Projected Staffing Required to Support Start of Staffing Staffing Installation As of 6/1979 As of 1/1980 Activities Contract PSI Applic. Applic. Applic. Exper. Exper. Exper. Contract PSI Position No. Educ. (Yrs.) No. Educ. (Yrs.) No. Educ. (Yrs.) No. No. Proj. Engr. Manager' 1 M.S. 11 1 B.S. 12 1 H.S. 11.5 1 1 Design Supvr. 1 H.S. 5.5 1 M.S. 10.5 0 1 ~ Mech. Sapvr. 1 M.S. 10 1 B.S. 4 0 1 Mech. Engrs. 6 B.S. 13.5 4 B.S. 8.5 0 4 1 M.S. 28.5 1 0 pj Elect. Supvr. 7 1 M.S. 6.5 0 1 ? Elect. Enges. 1 M.S. 6 o 1 M.S. 6 0 1 Civil Supvr. 1 M.S. 5.5 1 B.S. 2 0 2 Civil Enges. 1 M.S. 4 0 1 Nucl. Supvr. 1 M.S. 3.5 2 B.S. 1.5 0 2 Nucl. Engrs. Nuct. Safety & Lic. 1 M.S. 7 1 M.S. 7.5 0 1 Supvr. Nucl. Engineers 3 1 B.S. 13.5 3 i B.S. 15 0 3 1 M.S. 1 M.S. 1 PhD 1 PhD-S&L Design Supvr. 1 B.S. 8 1 B.S. 10 1 0 7 0 7 1 H.S. 25 S&L Engineers 4 B.S. ? M S

TABLE C-3 QUALITY ASSURANCE PERSONNEL Projected Staffing Required to Support Start of Staffing Staffing Installation As of 6/1979 As of 1/1980 Activities Contract PSI Applic. Applic. Applic. Exper. Exper. Exper. Contract PSI Position No. Educ. (Yrs.) No. Educ. (Yrs.) No. Educ. (Yrs.) No. No. Quality Assurance Manager 1 H.S. 6.5 1 B.S. 11.5 1 1 1 H.S. 14 0 1 Supt. Insp. 1 H.S. 13.5 Inspectors 18 2 B.1 47 3 H.S. 20 20 2 B.S. 53 17 24 15 H.S. 17 H.S. 1 Assoc. Deg. 1 Assoc. Deg, s U Mgr. Qual. Engr. 1 H.S. 21.5 1 1 Ad Qual. Engra. 7 3 B.S. 51.5 3 B.S. 17.5 10 4 B.S. 69 4 9 3 H.S. 5 H.S. 1 B.A. 1 B.A. Supt. Qual. Systems 1 M.S. 11 1 M.3. 11.5 0 1 Qual. System & 6 3 B.S. 35 8 5 B.S. 39.5 2 8 Prog. Support 3 H.S. 3 H.S. QA Recos.'e Supvr. 1 B.S. 1.5 1 B.S. 14 1 B.S. 2 1 1 Recordi Reviewers 5 1 B.A. 2.5 6 1 B.A. 5.5 5 4 3 H.S. 5 H.S. 1 B.S. Quality Assurance Staff 1 B.S. 8.5 1 0 G m .--m e - ~ - - ey

~ TABLE C-4 EXPERIENCE

SUMMARY

Projected Staf fing Required to Support Start of Staffing Staffing Installation As of 6/1979 As of 1/1980 Activities Contract PSI Applic. Applic. Applic. Exper. Exper. Exper. Contract PSI Position No. (Yrs.) No. (Yrs.) No. (Yrs.) No. No. Project Director 1 5 1 15.5 1 0 Construction 19 54.5 11 125 25 105 16 25 Project Engineering 17 83.5 10 75.5 17 77 10 18 Quality Assurance 40 168.5 10 93 47 194.5 32 50 o SUBTOTALS 77 311.5 32 309 89 376.5 59 93 h Project Suprset 1 4 4 43 2 11.5 4 2 TOTALS 78 315.5 36 352 91 388 63 95

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l QUALITY ASSURANCE MANAGER O 7 ?5 NW DESIGN & AUDIT IOPERATIONS CONSTRUCTION ~ ELN' ,PROCUR M i SUPERVISOR SUPERVISOR SUPERVISCR SUPERVISOR SUPERVISOR PEVIWS QUALITY ASSURANCE ORGANIZATION PUBUC SERVICE INDIANA FIGURE C-2 AS OF 6-79

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4 PROJECT CONTROLJ M MANAGER jyux MANAGER MATERIAL

PLAtNING, CONT R SCEDULE, AND COST MANAGEPOR SUPERVISOR StPERVISOR SUPERVISOR SUPERVISOR SUPERVISOR HANAGEM NT DATA PROJECT PLAtNING PROJECT 4 STORAGE Ato MANAGEE NT APO SCE DULING COST MAINTENANCE I M TION O

~ A4 CONSTRUCTION STOREKEEPER i l PROJECT CONTROL PUBLIC ORGANIZATION SERV 6CE INDIANA FIGURE C-6 AS OF 2-80

l ~. PROJECT ADMINISTRATOR STEND-CLERK STENO-CLERK l 1 NUCLEAg PRO 6ECT MAINT'NENCE ACCOLN"ING ADMINISTRATOR SUPERVISOR SUPERVlSOR ANAL YST BUILDINGS NUCLEAR PAJCLEAR WORD UTILITYP%N JANITORS CONSTRUCTION CONSTRUCTION CLERK PROCESSING Z ANALYST _ ANALYST A IG 5EN M ADMINISTRATIVE ggOR 9 g yg ASSISTANT ASSISTANT ASSISTANT SENIOR SENIOR ACCOUNTING ACCOthTING ASSISTANT ASSISTANT CLERKS CLERKS PROJECT SEbIOR ACCOUNTING ADMINISTRATION l ASSISTANT PUBUC ORGANIZATION SERVICE INDIANA FIGURE C-7 'AS OF 2-80

D. REVIEW OF SAFETY-RELATED CONTRACTS Item (4) of Part IV of the Confirming Order is whether and the extent to which PSI has i Reviewed all contracts of contractors and subcontractors doing safety related work to assure the adequacy of their quality assurance and quality control responsibilities and programs including conditions of such contracts that may impact negatively l on quality, identified the specific steps to be taken to assure such conditions do not reduce the quality of safety-related work, and submitted the schedule to implement such steps. i PSI has reviewed all safety-related agreements entered into prior to August 15, 1979. As a standard to review these agreements against, PSI first determined that its standard quality assurance requirements adequately addressed the quality requirements for a nuclear plant. All I agreements including safety-related work were then reviewed and it was determined that they included these requirements. Commitments to the Quality Assurance Program are satisfactory with the exception that the i implementation of stop-work authority in some instances is not sufficiently defined. Contractors are being directed to make the necessary corrections. When exceptions or clarifications were taken to PSI's specification l terms, an in-depth review of the exceptions or clarifications was made by PSI Quality Assurance. Based upon this review, PSI has determined that none of the safety-related agreements contain conditions which impact negatively on the contractor's quality obligations. The exceptions or clarifications were either acceptable or were not included in the agreement. In addition, a review is being made of the requirements of the commercial aspects of various specifications and l industry standards to identify any terms or conditions that conflict with controls established by the Quality Assurance Program. PSI has verified that the on-site contractors either have no subcontractors on site, or have included the requisite quality provisions in their agreements with their on-site labor i subcontractors. One instance was found where the subcontractor was ) . working to the contractor's Quality Assurance Program. l l i 1 III-D-1

E. DESCRIPTION OF DEFICIENCY IDENTIFICATION AND EVALUATION One of the NRC's concerns, identified as item IV (5) of the Confirming Order, is whether and the extent to which PSI has r Described the mechanism for assuring timely identification and evaluation of construction deficiencies including conflicts in i specifications, drawings, procedures, and directions released for i use in construction and described the system for assuring r corporate management's awareness of site problems on a timely basis and input into the evaluation and correction of these l problems. 'lle Marble Hill Project Quality Assurance Program has been revised to more clearly define these mechanisms, and strengthen them where j required. j l l. Identification of Construction Deficiencies by PSI l l a. Construction deficiencies representing departures from design requirements that are detected by PSI Quality Assurance personnel or contractor's personnel when performing inspections (i.e., first line inspections) shall be documented on a Nonconformance Report. I i b. Construction deficiencies representing departures from design I requirements that are detected by PSI personnel performing surveillance inspections (i.e., not first line inspection) shall be documented on a Corrective Action Request. j c. Deficiencies that are of a programmatic nature which have been detected either by inspections, surveillances, or audits shall be documented on a Corrective Action Request. d. Where conflicts occur between drawings, specifications, standards and procedures, the conflict and recommended action shall be documented by PSI or contractor's personnel on a Field Change Request. t e. The responsibilities and methods to be used by PSI personnel to identify and document deficiencies and conflicts on technical requirements are defined in the PSI Marble Hill Project Quality Assurance Manual. f. The contractor's quality assurance programs are being revised to include the use of these standard forms and methods for identifying deficiencies and conflicts. i i III-E-1

2. Evalustiens of Construction Daficiencias End Conflicts I Nonconformance Reports and Corrective Action Requests shall a. be initially evaluated by the cognizant PSI Superintendent Quality Engineering to verify information recorded and to determine if the deficiency is a " Potential NRC Reportable Item". If it is a " Potential NRC Reportable Item", it is l submitted to the Marble Hill Safety Review Committee for i evaluation and subsequent reporting, if applicable. j b. Evaluation and disposition of the Nonconformance Reports shall be done by the PSI Project Engineering Manager and approved by the appropriate Superintendent Quality Engineering and the architect-sagineer if the disposition is " Repair" or " Accept As Is". l i The PSI Quality Assurance Manager is responsible for c. evaluation and followup for Corrective Action Requests that are written as a ' result of repetitive deficiencies, lack of l' response to previous Corrective Action Requests, or for I problems that cannot be resolved at the PSI Superintendent Quality Engineering level. l The cognizsnt PSI Superintendent Quality Engineering is responsible for evaluation, resolution, and followup action on all other Corrective Action Requests. d. Field Change Requests are evaluated and approved by the same design organization that approved the original document (s) ( which the Field Change Request affects. In addition, Engineering Change Notices may be used by the i I l design organization to make changes to drawings and i specifications. The responsibilities and methods for evaluation of e. I construction deficiencies and conflicts is delegated and defined in the PSI Project Quality Assurance Manual. f. The upgraded staff, the relocation of the project staff to the site to improve communication among the project groups, and the intensified training program being implemented, along with the programmatic controls described above, will provide more timely identification of problems in the future. 3. Processing of Nonconformance Reports, Corrective Action Request;s, and Field Change Requests The Project Management Procedure, " Control of a. Nonconformances" provides time limits and flow paths for the evaluation and disposition of Nonconformance Reports and Corrective Action Requests. III-E-2 - i

b. Provisions hcva basu mada in the cdzinistrativa proceduras to provide timely evaluation and resolution of Nonconformance l Reports, Corrective Action Requests, and Field Change Requests. These provisions are briefly described as follows: i i. The number of forms to be used for reporting nonconforming conditions and for obtaining approval for design changes has been reduced, and the use of rhese systems simplified. To the maximum extent possible, these standardized forms and procedures have been established to be used by PSI and the site contractors to avoid confusion and dual reporting that had occurred previously. ii. As part of the computerized tracking and trending program, ten (10)-day and thirty (30)-day overdue reports will be used, sorted by responsible I organization, on outstanding Nonconformance Requests and Corrective Action Reports. These reports will provide visibility to the appropriate levels of management to take necessary action to maintain timely evaluation and disposition. 4. System for Assuring Management Awareness of Problems l [ The Project Director reports directly to the Vice a. President-Electric System. This direct communications channel from the construction site to the corporate level provides timely corporate management awareness of site problems which require immediate corrective action. b. "NRC Reportable Items" are submitted to the Marble Hill Safety Review Committee for review and action. PSI management is made aware of this committee's action and is signatory for any reports to the NRC resulting from this committee's work. A program has been established for recording and tracking c. trende on quality problems identified on Nonconformance Request s and Corrective Action Raports. The PSI Qual'.ty Assurance !!anager shall conduct a trend analysis review of nonconformatees and deficiencies of PSI and its contractors. The Quality I.ssurance Manager is responsible to take actions to resolve unsatisfactory quality trends. In addition, the Quality Assurance Manager is responsible to report the results of his review to the Vice j President-Electric System in writing. This report is also reviewed by the corporate Quality Assurance Review Committee. d. Involvement of senior PSI management in site problems and input into correction of those problems occurs in two ways. III-E-3

M:nthly sit 2 prograss eastings hcva bacu institutsd cnd ora nrw being hald. Attendcnce includas ksy sita parsennal, such as the Project Director and the Construction, Quality Assurance, Project Control, and Engineering Managers or their delegates, and the Chief Executive Officer and Vice President-Electric System of PSI. These meetings are intended to provide both a project status to corporate management and to obtain management direction and solution of site problems. Site problems or action items are identified to management on a status list and reviewed at the meeting. This list typically includes such items as staffing progress, development of programmatic controls, or site problems requiring management review or input. This list is revised using management input subsequent to each meeting; items r which are not dispositioned are carried forward to future meetings. The responsibility for the Quality Assurance Program rests with the Vice President - Electric System, who is accountable to the President. There is a need, however, to disseminate important information relative to the necessity for and effectiveness of the Quality Assurance Program to other areas of corporate uanagement. Therefore, the Quality Assurance Review Committee has been restructured and is chaired by the Vice ? resident - Electric System. The Committee will not set polt:y or initiate action since these responsibilities are clearly delegated to the respective line organizations as defined in the Project Quality Assurance Manual. This Committee will meet no less frequently than every two months and more often as project activities require. e f l I l III-E-4

F. DESCRIPTION OF SYSTEM TO HALT CONSTRUCTION Item (6) of Part IV of the Confirming Order is whether and the extent to which PSI has: t Described the system for promptly halting construction due to nonconforming circumstances or unacceptable work including 7 criteria for defining unacceptable sork and for assuring instructions explicitly describe how work is to be performed so l that both production and inspection personnel understand what is l not acceptable. I The revised PSI Quality Assurance Program defines the system for halting construction due to nonconforming circumstances or unacceptable i work. In addition to the revisions made to the PSI Quality Assurance Program, PSI will review the programs of the contractors to assure that their i programs adequately define acceptable systems for halting construction due to nonconforming circumstances or unacceptable work, including systems for defining unacceptable work and for assuring that i instructions explicitly describe how work is to be performed so that production and inspection personnel understand what is not acceptable. 1. System for PSI to Halt Construction i i a. PSI quality assurance surveillance, inspection, and audit [ personnel are authorized and assigned the responsibility to l stop further processing of unacceptable items or materials by its suppliers and contractors. t The PSI quality assurance surveillance, inspection, and audit personnel are responsible for notifying cognizant PSI personnel, the organization being stopped, and are responsible for documenting the unacceptable condition. i b. The PSI Quality Assurance Manager is fully authorized to stop work of any PSI, contractor, or supplier organization which, in his judgment, must be stopped to correct poor quality j trends or performance. l This Stop Work authority is of a broader scope than stopping a single process and may include such things as all design activities of an organization, all installation activities of a contractor, or all fabrication or processing of PSI purchased materials or items. i I Upon receipt of the Stop Work order, the PSI Project Director is required to take those actions necessary to assure that the work is stopped promptly. ? t III-F-1

If tha cctivity is ASME Coda related, the PSI Quality Assurcnce Men ger shn11 notify the Authorized Nuclocr i Inspector. 1 2. Contracter's Systems to Halt Construction ( To provide assurance that unacceptable work is stopped, a. qualified PSI Quality Ascurance personnel are reviewing the quality assurance programs of site contractors to determine if adequate authority, respencibility and systems are delegated and defined to the -ontractor's quality assurance personnel, and are acceptable. The criteria used in this review shall be in consonance with the authorities, responsibilities and methods to be used by PSI, i.e. that the i contractor's quality assurance personnel have full authority and responsibility to stop unacceptable work, either of a regular item or process nature, or in a broader sense such as stopping all qualie-related activities of a contractor as a [ result of unacceptable conditions or quality trends; and that j the methods for notification and documenting the stop work are clearly defined. b. Where the contractor's quality assurance programs are found to be insdequate as a result of this PSI review, the programs are to be revised to an acceptable condition prior to start or restart of activities by that contractor. 3. System for Defining Unacceptable Work l The criteria for defining acceptable work is established by a. engineering drawings, design specifications, and applicable r codes and standards. Process controls established in i approved work procedures necessary to meet the requirements i of the engineering drawings and specifications are also 1 criteria for defining acceptable and unacceptable work. i Criteria for defining acceptable programmatic administrative controls are defined by codes, Federal regulations, ANSI l standard, and regulatory guides. f b. Inspection procedures and instructions are to be used by PSI l quality assurance personnel when conducting surveillance and l inspections. As a minimum, these procedurer, anu instructions shall contain: (a) identification of chara:teristics to be inspected, (b) accept / reject criteria, (c) 'ndividuals or i groups responsible for the inspection, (d) s

• hod of inspection, (e) verification and certification of inspection and, (f) provision for recording the results of the inspections.

III-F-2

Quality As' rtAuce psrscanal cre required to j determine acceptable / unacceptable work based upon the accept / reject criteria established by the Engineering drawings, design specification applicable codes and standards, and are not authorized to permit deviations from these criteria. Where conflicts occur between these criteria documents or in interpretation of the criteria, these conflicts are to be documented on a Field Change Request and resolved by the I cognizant design organization. Work control procedures and inspection procedures c. and instructions are to be prepared by and used by PSI contractors in performance of their 3 construstion and inspection activities. These work control procedures and inspection procedures are to be reviewed and approved by PSI Quality Assurance for assurance that qualitative and quantitative accept / reject criteria are adequately defined. d. PSI and contractors' procedures and instructions which had been approved by PSI Quality Assurance prior to the Confinning Order will be reviewed i again and revised as necessary to assure that these documents contain the necessary l accept / reject criteria and meet the requirements of the PSI Project Quality Assurance Manual prior to resumption of each type of activity by PSI and i the contractors. t i Pre planning meetings will be scheduled prior to e. start of critical or new types of construction activity to review the construction procedures i and accept / reject criteria. PSI Construction j Management and contractor management are l attendees at these meetings. These meetings will resolve procedural conflicts and differences in interpretation of accept / reject criteria prior to commencement of the work. l 4. Training To provide assurance that the responsibility to exercise sto'p work authority when unacceptable conditions are observed and to assure the proper understanding ana interpretation of the i accept / reject. criteria, training programs will be initiated to train construction and inspection personnel. The training program for the Marble Hill Project is described in Part III, Section C, of this report. III-F-3

I G. DESflRIPTION OF INSPECTION PLANNING Ites (7) of Part IV of the Confirming Order is whether and the extent to which PSI has: .7escribed the system for assuring inspections on a I t?mely basis including complete inspectica procedures and preplanning of activities to assure availability of trained inspectors. The ability to perform timely inspections is a direct function of the availability of inspectors. Work to be done can be matched with available inspection manpower resources both on short and long term basis. j For short term inspection planning, specific work packages, l consisting of discrete schedulable activities, shall be developed by Project Control and evaluated by Quality Assurance for inspection manpower requirements. Construction schedules shall be revised to make optimum use of available human and equipment resources. Construction work shall not be scheduled beyond the capability to verify quality. Effectiveness of the program will be assured by Quality Assurance participation in the work planning, by PSI surveillance and audit, and by the enhanced authority of the PSI Inspectors and Quality Assurance Manager to stop processes where it appears that quality may be jeopardized. Long term matching of inspection resources with work will be accomplished by Quality Assurance review of projected i work forces of PSI and its contractors. This review will permit recruiting and training activities to be carried out i in such a manner as to provide trained Quality Assurance i personnel necessary to assure the quality of the work. t As a part of the revised PSI Quality Assurance Program, inspectors shall be provided with approved inspection j procedures, instructions, and checklists prior to i performing inspection operations. These doctasents shall contain identification of characteristics to be inspected, j identification of personnel or groups performing the j inspection, a description of the method of inspection, i j accept / reject criteria, verification of completion of i inspection, and a record of the results of the inspection. To further assure that inspections are done in a timely manner, PSI will identify specific hold points be l established in the contractor's planning and make provisions for notification on " hold" points. This program, coupled with having the work effort managed on an " area" basis, with inspectors assigned to each area, will assure timely inspections. III-G-1

H. DESCRIPTION OF PSI ASME CODE PROGRAM Item (8) of Part IV of the Confirming Order is whether and the extent to which PSI hast l Described how the Licensee intends to manage the program covered by Section III of the ASME Nuclear Components Code including the technical responsibility for all design efforts of the NSSS.and A/E and the administrative control of design and manufacturing [ effort of all component manufacturers. The PSI Project Quality Assurance Manual has been developed to address PSI's responsibilities as an Owner as defined by the ASME Code, and to address non-ASME Code activities for safety-related construction. The PSI ASME Quality Assurance Program has been developed to assure that PSI responsibilities as an N-Certificate holder for piping systems comply with ASME Code requirements and to ensure achievement of the highest i feasible degree of functional integrity of piping systems. The program was approved and issued on January 2, 1980 and became effective for implementation on February 8, 1980. An interim letter of authorization has been issued by the ASME. In addition, the concerns raised by the National and ~ Indiana Boiler and Pressure Vessel Boards have been addressed. 1. General Responsibilities of PSI as Owner a. The Project Quality Assurance Manual defines PSI's responsibility as an Owner under the applicable rules of NCA 3200 of the ASME Code. b. PSI has obtained an Owner's Certificate of Authorization as required by the ASME Code. PSI will certify and file the Owner's Data Report c. as required by NCA 3270 of the ASME Code. d. PSI or its designee will assure that overpressure protection requirements are designated for each component or system, e. PSI has obtained a written agreement with an Authorized Inspection Agency. l l l l III-H-1 i

f. Preparction of Dasign Sptcificctions is parformed by PSI or its Design Subcontractor. The Design Specifications are reviewed by the PSI Project Engineering Manager to assure that ASME Code requirements are met. The Design Specifications L are certified by PSI or its designee in accordance with ASME Code requirements. l g. Review and release of Design Specifications is performed by PSI Project Engineering and Quality Assurance to assure inclusion of ASME Code requirements. i i h. Review of component manufacturers' Quality Assurance Programs and ASME Code authorizations is performed by PSI Quality Assurance. i. Periodic surveillance at the component manufacturers' facilities is performed by PSI Quality Assurance to determine compliance with their approved ASME Quality Assurance Programs. l j. PSI Project Engineering reviews technical changes to the Design Specification to assure compliance with ASME Code. k. PSI Project Engineering or its qualified Design Subcontractor reviews and certifies the review of Component Design Reports. 1. Physical receipt inspection and review of documentation is performed by PSI Quality Assurance upon delivery of the component to the i project site. 2. General Responsibilities of PSI as an N-Certificate f Holder a. The Quality Assurance Manager, under authority from the Vice President-Electric System, has been delegated responsibility and authority for implamentation and maintenance of the ASME Quality Assurance Program as well as evaluating its effectiveness. b. The PSI Project Engineering Manager is responsible for design activities associated with the Marble Hill Project. c. Sargent & Lundy Engineers have been retained by PSI as the Design Subcontractor for all ASME Code piping systems except for reactor coolant piping systems for the Marble Hill Project. III-H-2 i

d. Westinghouns h0s bsen salsetsd by PSI es ths Design Subcontractor for reactor coolant f piping systems. The Design Subcontractors are responsible e. for: i i. Reviewing the requirements of the I Certified Design Specifications. ii. Performing stress analysis i calculations. iii. Preparing drawings and specifications. { iv. Preparing Design Reports or Load i I Capacity Data Sheets as applicable. v. Certification of the Design Report or Load Capacity Data St aet, when required by the Code. I vi. Reconciliation of changes to specifications and drawings with the i i Design Report. I 1 vii. Assuring that applicable requirements of the Certified Design Specification i and of the Code are correctly i translated into specifications and j drawings. l i 3. PSI's Technical Responsibility for Design Efforts (N-Certificate Holder) f The Project Engineering Manager reviews the ) a. Owner's Certified Design Specifications. i b. The Project Engineering Manager subcontracts i dcsign work to the Design Subcontractors in accordance with the ASNE Quality Assurance l Program. The Design Subcontractors prepare i and certify the Design Reports. l c. The Project Engineering Manager reviews the Design Reports to assure that they conform to applicable Code requirements and the Owner's Certified Design Specifications. i d. The Design Subcontractors provide PSI with engineering and construction drawings for piping systems. The drawings are reviewe.d by PSI Project Engineering. t t f III-H-3

e. Enginsaring cud tcchnical documints cre l controlled in cecord:nce with tha document control provisions of the ASME Quality Assurance Program. 4. Acquisition of "N" Stamp PSI will arrange for an ASME implementation a. survey of the Marble Hill Project timed so that the survey will start the same date the Confirming Order is lifted with respect to Code work on piping systems. b. To assure that the program for Code activities progresses satisfactorily and is being implemented properly, the following actions are ( being taken: l t i. PSI has retained an independent consultant (NUTECH) to: (a) Provide development of training programs for PSI personnel on Code requirements and the ASME Quality Assurance Program. (b) Provide assistance to PSI in developing detailed implementing procedures. (c) Perform periodic reviews at the job site to <ssure that the program is being properly implemented. (d) Perform an audit of Code activities by [ I PSI shortly after coammencement of Code activities. ? 5. National and Indiana Boards' Concerns ~ a. The National and Indiana Boards conducted a series of reviews and meetings at the Marble Hill site during the period of June 12, 1979 through October 12, 1979. The results of these reviews were documented in two letters from the National Board to PSI which were dated July 12, 1979 and i November 12, 1979. i b. PSI has conducted a review of the items addressed l in these letters and has responded in a letter from S. W. Shields to the Chief Inspector, Indiana Boiler and Pressure Vessel Board, dated January 17, 1980, with copies to the National Board and the Nuclear Regulatory Conunission, Region III. 'se III-H-4

This 1sttsr outlinsd 14 items which cre includad in PSI's program for continuing with ASME Code work and addressed the specific findings of the National and Indiana Board reviews. The 14 items are as follows: i. PSI has had its ASME Quality Assurance l Program reviewed by the ASME Survey Team and as a result of their findings, expect to receive an interim letter from the ASME soon. l ii. PSI will request ASME to survey its Laplementation of the ASME Quality Assurance Program within six months of resuming Code l work on piping systems. (See Note 1 below - l not part of letter). i iii. PSI has an Authorized Nuclear Inspector j (ANI) on site who will be kept advised of l Code related activities. i iv. PSI's ANI is reviewing the documentation for the Code work PSI has performed in the past, j to assure that the requirements of PSI's l ASME Quality Assurance Program have been met. Any variance from the Quality Assurance Progrse will be corrected in accordance with that program. i v. All records and documentation will continue i to be available to PSI's ANI and all subcontractors at the site. Copies of any Code related documentation reported by PSI's subcontractors will be provided. I vi. A training program will be implemented to l assure that PSI personnel involved in l Quality Assurance and Code related work understand the requirements of PSI's Quality Assurance Program and the ASME Code as these documents relate to their work. j vii. PSI will assure that the subcontractors at the site are advised of the elements of i PSI's ASME Quality Assurance Program and the ASME Code, as it relates to PSI's interfaces l with them in PSI's capacity as an N-Certificate holder. 1.) Subsequent to the January 17, 1980 letter, the decision was made to arrange for the survey to start the same date the Confirming Order is lif ted with respect to Code work on piping systems. III-H-5

viii. PSI hcs ecda a thorough sacrch of tha records to datarmina tha quantity cud location of the safety-related Code materials furnished by PSI. Of the 87 pieces of material furnished to Cherne, four are installed (not embedded) and the remaining are stored in place or in the laydown areas. These are in a " hold" status. Two pieces of material were furnished to Stewart Mechanical which are installed and embedded. ix. For the material furnished by PSI to Cherne, PSI has reviewed the documentation and determined that it is acceptable. The two pieces furnished to Stewart Mechanical are being checked. x. PSI is currently searching records and documentation with its subcontractors to i verify that piping subassemblies comply with l ~ the requirements of the Code. A sampling of data packages from each of the piping suppliers is currently underway to determine j if any generic problems exist. j xi. The purchase specifications will be modified to permit radiographs to be furnished in a more logical sequence. xii. PSI will request ITT Grinnell to ask their material supplier (National Annealing Box Co.) to obtain official documentation from i ASME verifying that their scope of work included the manufacture of tubular products with filler metal added. This is to cover the period from January 1977 through January 1980. xiii. PSI will request ITT Grinnell to obtain verification from Gulf and Western that T/F Houston Div. and Gulf and Western Energy Products Group Plant #4 are the identical plant. xiv. National and Indiana Boards will be notified of significant events with regard to PSI's ASME Code work. c. PSI reviewed the above fourteen point program with representatives of the National and Indiana Boards in a meeting on January 16, 1980. Those representatives indicated their concurrence with this program. III-H-6

9 1. DESCRIPTION OF SYSTEM OF INDOCTRINATION Item (9) of Part IV*of the Confirming Order is whether and the extent to which PSI has: Described the system to train all levels of construction personnel in the need and importance of satisfying quality requirements and to encourage all j personnel to communicate, without recrimination on the j part of the licensee or its contractors, their concerns or knowledge of improper construction practices to proper levels of management for evaluation and resolution. PSI will implement indoctrination of its site personnel as a part of the training program described in Part III, Section C, above. Additionally, PSI will provide material to the contractors, who will indoctrinate craft personnel as they are assigned to the project. 1. Content An audio-visual presentation is currently being l produced to be presented to construction personnel. l This presentation will be used as an orientation j program for new construction personnel and is designed i to address the uniqueness of building a nuclear power plant. The presentation strongly emphasizes the need for quality work and further addresses the issue of reporting without recrimination. This presentation will be available for use about March 1980. t Indoctrination for site personnel will include the requirements of 10 CFR 21. In addition to the posters required by 10 CFR 21, each employee is given a handbook, outlining the provisions of 10 CFR 21, for personal reference. This booklet stresses that recrimination is not associated with any such reporting. 2. Implementation The indoctrination program is being developed in modular form. This program will'be presented to current employees and to each new employee upon arrival at the job site. I I III-I-1 l l l

s 3. Rscords Records will be maintained identifying each employees' participation in the indoctrination program. I 4. Other In addition to the above, PSI is developing posters and other materials that will be prominently displayed on the job site as a reminder of PSI's concern and commitment to quality and its policy of no recrimination for reporting. t P l l r i t I i l \\ III-I-2 -}}