ML20032B113
| ML20032B113 | |
| Person / Time | |
|---|---|
| Issue date: | 10/28/1981 |
| From: | NRC COMMISSION (OCM) |
| To: | |
| Shared Package | |
| ML20032B112 | List: |
| References | |
| REF-10CFR9.7 SECY-81-600, NUDOCS 8111040483 | |
| Download: ML20032B113 (87) | |
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UNITED STATES OF AMERICA 2
NUCLEAR REGULATORY COMMISSION 3
4 DISCUSSION OF NRC ENFORCEMENT POLICY 5
6 Room 1130 7
1717 H Stree t, N.W.
Washington, D.C.
8 Wednesday, October 28, 1981 9
The meeting was convened, pursuant to notice, at 10 10 : 40 a. m.
11 BEFOREa 12 NUNZIO J.
PALLADINO, Chairman VICTOR GILINSKY, Commissioner 13
?ETER A. BRADFORD, Commissioner JOHN F. AHEARNE, Commissioner 14 THOMAS M. ROBERTS, Commissioner 15 STAFF PRESENT:
16 LEONARD BICKWIT, General Counsel FORREST REMICK, Chief, Office of Policy Evaluations 17
- CHILK DIRCKS 18 D. THOMPSON V. STELLO 19 R. DE YOUNG b
J. MURRAY 20 J. KEPPLER J. FOUCHARD 21 22 23 24 25 ALDERSoN REPORTING COMPANY,INC, 400 VIRGINIA AVE S.W., WASHINGTON. O.C. 20024 (202) 554-2345 j
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PEOCEEDINGS 2
CHAIRMAN PALLADINO:
Will the meeting please come
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3 to order.
4 The subject of today's meeting is a discusrica of 5 NRC enforcement poliar.
We vill proceed first by having the 6 staff highlight the policy and set the stage for Commission 7 questions.
8 NR. DIRCKSa Mr. Chairman, the slides are here.
9 Vic Stello will take us through the briefing.
We vill not 10 dwell too much on past details.
We vill get to what we 11 consider the more significant, the two or three more 12 significant issues that have come out of the revision and 13 are proposed for the final statement.
So we vill not dwell 14 too much on the past history.
We can do a summary and then 15 get directly to the issues.
16 MB. STEL10:
Just to get the first slide, the 17 enforcement issue is an issue of long standing before the 18 Commission.
It began in 1972.
19 (Slide.)
20 But the purpose of beine here today is to try to 21 move forward, where in f act for tr.e first time we vill have 22 a published document that announces what the enforcement 23 policy of the agency is.
24 I think I might add that that is extremely 25 important to the office.
It was one of the first things ALDERSON REPORTING COMPANY,INC, 400 VIRGINIA AVE., S.W WASHINGTON, D.C. 20024_(202) 554 2345
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1 that I recognized when I went into this job, that we really 2 needed to set from an overall point of view a policy for
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3 enforcement that represented to the best measure we could 4 the policy that the Commission vanted the office to follow.
5 And 1 view this document as in fact that policy and it would 6he used for that purpose, as the guidance of.the Commission 7 for what we ought to do.
8 Following the preparation of the interim report 9 and policy, it has been used that was published last October 10 as interim guidance and was used in that way, there are a 11 number of things the Commission asked us to do.
One of 12 those was to have considerable public impact from meetings 13 that we had throughout the country, that would really have s
14 an opportunity to tell us what they thought about our 15 enforcement policy.
16 And we did in fact have those meetings, and had an 17 axtensive comment period, which was extended to allow for 18 f urther comment.
19 The next slide, slide 2 --
20 (Slide.)
summarizes the significant comments that were 21 22 received, and the attachment we sent to the Commission is an 23 identification of the overall comments that were passed on 24 to us.
I think that the prevailing comment that came 25 through was that the overall tone was too hostile and ALDERSoN REPORTING COMPANY. INC, M VIR@lNIA AVL #LW WASHIN@T@No @,@. M (T#a @@3-@0@
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1 unnecessarily adversarial.
2 COMMISSIONER GILINSKYs Did you get comments of 3 the inspectors as well, our own inspectors?
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4 MR. STELL0s Several times in the process the 5 draft of the document was distributed throughout the 6 regions, to collect from their management processes the 7 views of the whole regional offices, getting comments f ron-8 everyone in the office to the extent that we need it.
9 I am not suggesting that each individual inspector 10 commented on it.
11 NR. KEPPLER4 I can tell you in Region III ve 12 actively talked about it.
13 CONMISSIONER AHEARNE:
Are they kind of factored 14 into this final document?
15 NE. KEPPLEP They're factored into the document 16 to the extent that I influenced it.
17 MR. STELL0s I won't attempt to go through each of 18 these by themselves.
The central comment was there was a i
l 19 fear of having rigidity and finally getting promulgated as a 20 rule and a regulation for which there would be little or no 21 flexibility on behalf of the decisionmaker to take into 22 account the specific f acts, and would lose the kind of 23 flexibility that our policy can have and in this case must 24 h a ve.
25 Because as you know frcm our discussions on ALDERSON REPORTING COMPANY,INC, 400 VIRGINIA AVE., S.W., WASHINGTON, D.C. 20024 (202) 554-2345
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1 enforcement actions in the past, it is not an easy matter to 2 deal with and it should in fact retain the flexibility, and
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3 it is the recommendation to go forward with the policy as a 4 policy and incorporate it into the regulations in that wayo 5
COMMISSIONER AHEARNE:
Do you see any difficulty 6 in getting at some point so much flexibility that you lose 7 wha t - you were hoping f or originally, a set of guidelines 8 that would be relatively well understood both by our own 9 people and the licensees?
10 MR. STELL0a I think that is a concern.
I don't 11 think we did that, though.
I think we still have sufficient 12 guidance in here, obviously f ar more than anything we ever 13 had.
So I think it's a good balance.
14 But that flexibility, I want to emphasire, is a 15 very important aspect of it and it is there.
16 The next slide --
17 COMMISSIONER GILINSKY:
Could you explain the 18 third item?
19 MR. STELLO:
That's something I was going to come 20 to a little later.
If the licensee identifies an issue, the 21 var the civil penalty had been ec9structed in the interim 22 policy s it still had the overriding -- the impression 23 created by our action, as going counter would cause people 24to not b ring up items; if there was a valve open and they 25 kne w if they told someone it was open that there was going ALDERSoN REPORTING COMPANY. INC.
400 VIRGINIA AVE., S.W., WASHINGTON. D.C. 20024 (202) 554-2345
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1 to be a big harassment over it, and it became a major 2 problem and a major flap and big civil penalties, that it
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3 might create an incentive for the employee to just go ahead 4 and close the valve and not say anything, and that we would 5 not find problems of noncompliance, and that the environment 6 and the incentive was counter, and that was one of the major 7 things I'll be coming back to that was reflected in the 8 policy.
9 (Slide.)
to The third slide.
Let me continue the point I was 11 just discussing a moment ago, because I think that is one of 12 the major changes that was made in the enforcement policy, 13 and that is to allow for licensee-identified items of 14 noncompliance, that if those items were so identified and 15 the licensee had done all the things -- he properly 16 identified and reported it, he took the kind of 17 comprehensive correction action that we want him to take to 18 prevent the occurrence, the operaticnal history was 19 f avorable, there were no prior notices of similar events,
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20 and it is not clearly 'something for which there has been a i
21 variety of previous occurrences -- taking all of these l
22 things into account would allow us then to fully mitigate 23 for those circumstances, not to impose any civil penalty if i
24 that in fact were the case.
25 I think that is a very important feature in the I
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_ _ _ _ _ _ Ol$ VIRGINtA AVE., S.W., WASHINGTON. O.C. 20024 (202) 554-2345
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1 new policy, because it does send, I think, the correct 2 message to provide an environment in which people vill want 3 to find and report things to us, and do it quickly and 4 eff ectively; and when they do, there is, if you will, a 5 report for doing it.
6 Of course, equally so the same factors, taken into 7 account, will allow us to escalate the civil penalty by a 8 f actor of 100 percent when things have not gone well, to go 9 all-the way up to the full authority we have, $100,000 for 10 the instance.
So if a poor job has in fact been done or if 11 ve find it, one of our inspectors rather than the licensee, 12 and it comes to us through that kind of a vehicle, then we 13 have the exercise of considerable muscle.
14 So it's providing the environment both ways.
If 15 they don 't find it and we do, it's going to hurt much 16 vorse,
And if they do a good job of finding it and 17 correcting it, there vill be no civil penalty.
18 CHAIRMAN PALLADINO:
Is that categorical or there 19 might be circumstances under which you would consider a 20 civil penalty even though maybe the reporting came through 21 --
22 COHHISSIONER AHEARNE:
It's flexible.
23 CHAIRMAN PALLADINO:
You made the statement sound 24 so categorical.
Tha t's why I raised the question.
25 HR. STELLO:
What I said is that everything was ALDERSON REPORTING COMPANY. INC.
400 VIRGINIA AVE S.W., WASHINGTON. D.C. 20024 (202) 554 2345
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8 1 very favorable with respect to evecy one of the elements I 2 men tioned, and then at that time you could make the 3 decision.
You might also decide, for whatever the reason 7
4 isc that it still warrants a civil penalty and tha t 5 discretion is there and can be applied.
6 One other change for which there is an item of 7 disagreement, and that is a change as to whether or not we 8 ought to issue a press announcement for a severity level 9 three violation where we've just proposed it, we have not 10 imposed it, and should we go forward and issue a press 11 announcement and make a big case out of it.
12 My view is that as a matter of policy se ought to 13 provide the opportunity bef ore we make a public 14 pronouncement, even though we are very careful in trying to 15 use the words while the action is proposed and to reserve on 16 the public announcement press r,elease of that action until 17 such time as we have made up our mind and have given the 18 licensee a chance to respond, as a general principle, as a 19 ma t.ter of policy.
20 CHAIRMAN PALLADINO:
Joe Fouchard, I believe, or 21 the public affairs people believe that the press release 22 would be issued when the penalty was imposed.
And I was 23 wondering what their thinking was.
24 MR. STELLO:
Mr. Fouchard disagrees --
25 COMMISSIONER AHEARNE:
But you do seem to believe ALDERSoN REPCRTING COMPANY,INC.
400 VIRGINIA AVE S.W WASHINGTON. D.C. 20024 (202) 554-2345
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1 that you ought to issue a press release for one and two?
2 MR. STELL0s Yes, at that poin t --
3 COHNISSIONER AHEARN.Es Could you draw the 4 distinction why?
5 MR. STELLO:
In levels one or two3 you are out 61nto the realm where something serious, n f act has 7 happened.
8 COMMISSIONER AHEARNE:
Are you saying that on one 9 and two we know something has happened, on three we suspect' 10 something sight have happened ?
11 MR. STELLO:
Generally that's true, too.
On one 12 and two you know, and with respect to three it includes 13 suspicion, but can include knowledge.
But I take into 14 account also the importance.
By definition, one and two are 15 f ar more important.
16 CCMMISSIONER AHEARNE:
I thought that vac mere the 17 distinction, that we knew versus we suspected.
I thought 18 one and two were primarily the importance of the items.
19 HR. STELLO:
Both.
The importance, if I were to 20 weign the primary factor, that would be my primary factor.
21 COMMISSIONER AHEARNE:
You wouldn 't say you would 22 put it in three because it was very important, but you're 23 not positive, would you?
24 HR. STELLO:
There's a measure of uncertainty 25 about everything.
I don't think that that would in any wa y ALDERSON REPORTING COMPANY. INC, 400 VIRGINIA AVE., S.W., WASHINGTON. O.C. 20024 (202) 554 2345
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10 1 be t*e overriding factor.
Severity levels one and two are 2 f airly important subjects and there would be a considerable 3 concern, and I think that the public ought to be informed 4 immedia tely.
5 COMMISSIONER AHEARNEs It sounded somewhat tnet 6 along' with when you reach one and two in your list of 7 enforcement actions, j n addition to the money and so forth,
8 ve also put out a public notice.
9 HR. STELL0s That becomes part of enforcement, 10 tha t's correct, it does indeed.
And it does have an effect, 11 a very significant effect.
And I think that with respect to 12 matters of lesser importance we can wait, because they are 13 damaging, a press release about a level 3 or a level 1 in 14 terms of the damage that might have to a utility's 15 reputation I think is probably not much different.
16 COMMISSIONER AHEARNE4 B ut the proposed action 17 still goes in the public document room?
18 MR. STELLO4 Absolutely.
19 COMMISSIONER AHEARNE:
So it's not a question of 20 it being available to the public; it's a question of it not j
21 being a press release.
22 MR. STELLO:
I think that's what Joe's point is, j
23 CHAIEEAN PALLADINO:
Joe, would you comment?
24 MR. FOUCHARD:
Yes, sir.
My view is that we 25 should be uniform across the board, that a civil penalty is l
ALDERSON REPORTING CCMPANY,INC, 400 VIRGINIA AVE S.W WASHINGTON, D.C. 20024 (202) 554 2345
4 11 1 a serious action.
It is viewed I think by the Coamission as 2 a serious action.
It is viewed by people who view the r'
311censee in the local area as a serious action.
4 A proposed action is something that they are 5 interested in.
I think the only disagreement we have is 6 over severity level three.
I would point out that unless I 7 have been misinformed, the cap on severity level three is 8 $100,000.
I cannot envision this Commission proposing to 9 fin's the utility $100,000 and not volunteering that 10 inf o rmation.
11 Similarly, I think we have had discussions over 12 the last day or so about a severity level three case which 13 is soon to be announced.
I cannot envision us not 14 volunteering a press release in that particular matter 15 either.
16 I rest my case.
17 COMMISSIONER AHEABNE:
Joe, but yet you don't seen 18 to feel that we ought to issue a press release for four and 19 five, is that correct?
20 MR. FOUCHARD:
Four and five are getting down 21 pretty much into the noise level, yes, sir.
22 COMMISSIONER AHEARNE:
But then it seems to me 23 tha t neither ICE nor OP A feels that we ought to be 24 inconsis ten t across th e boa rd.
ICE feels that we ought to 25 issue them on one and two, not three, four and five, but you MERSoN REPORTING COMPANY,INC.
400 vtRGINIA AVE., S.W., WASHINGTON. O.C. 20024 (202) 554-2345
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12 1 believe it should be on one, two and three.
2 HR. FOUCHARDs I may be misinformed on how many
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3 cases we 've had of civil penalty on four and five.
It may 4 not be very few.
5 CHAIRMAN PALLADINO:
No, it's not very few.
6 MR. FOUCHARDa Okay.
7 ER. STELLO:
Does someone bappen to have the 8 statistics?
9 HR. FOUCHARD4 That was my impression.
10 MR, THOMPSON:
There have been a number of cs.ses 11 in' which severity level four and five vio.'.ations were 12 involved in a civil penalty package.
However, the event 13 associated with those civil penalties has been at three or 14 higher.
15 COHNISSIONER GILINSKY:
Were there any civil 16 penalties levied specifier 117 for severity level four and 17 five violations?
18 HR. THOMPSONa I don't recall any.
19 MR. FOUCH ARD:
I don't either.
20 COMMISSIONER AHIARNE:
This is an enforcement 21 policy paper, not a civil penalty paper.
Have we issued any 22 four and five level violations?
23 HR. TH0EPSON:
Oh, yes, a very large number.
24 MR. STELLO:
A very large number.
25 3R. FOUCHARD4 I think the civil penalty, Mr.
ALDERSON REPORTING COMPANY. NC.
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13 1 Ahearne, is a very visible action.
2 CONMISSIONER AHEARNE:
I-vould hope that any time
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3 we issue a penalty it's a visible action.
4 MR. FCUCHAhDs We go all the way from notices of 5 violation to civil penalties to orders to modify or suspend 611 censes.
7 COHNISSIONER AHEARNE:
I would hope that on our 8 side we take these seriously and we approach these, any 9 p en alty, whether it's a notice all the way up to shutdown, 10 that it's all taken seriously.
So I'm not sure I understand 11 why there should be a gradation, unless part of the -- if 12 part of the enforcement package is that at some point we put 13 the public spotlight on them, even before we finish, then I 14 would understand it.
Otherwise, I don't understand why we 15 slice it someplace.
16 MR. FOUCHARD:
Again, on four and five I don't 17 believe there have been any civil penalties in that area, 18 and the only disagreement we have is in that area.
19 MR. STELIO:
I should note one thing for the 20 Commission, that the new definition of severity level three 21 is a combined three and four level category, and the scale 22 of severity level three is broader, which will include many 23 of the items of lesser importance as well.
24 I do view, and I think I want to emphasize, that 25 issuing a press announcenent by itself has a significan t ALDERSON REPORTING COMPANY,INC,
._....,._,. _ __f00 VIRGINIA AVE., S._W., WASHINGTON. D.C. 20024 (202) $54-2345 _
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1 eff ect on licensees.
2 CHAIRMAN PALLADIN0s What would be your opinion
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3 about using press releases on proposed penalties or only 4 civil penalties?
Is that what you're proposing?
5 NR. STELLO:
For levels one and two press releases 6 would automatically go. For three as a general matter, it 7 would not.
8 CHAIRMAN PALLADIN04 If there 's a civil penalty, 9 if there 's a dollar penalty?
10 HR. STELLO:
I would not with three.
11
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CHAIRHAN PALLADINO:
I'm saying what would be 12 vroag with saying that any time you impose a civil penalty 13 that you make a press release even when you propose it, 14 because if it's severe enough to warrant a civil penalty it 15 sounds to me it's severe enough to accomplish whatever 16 purpose you want to accomplish with a press release on the 17 proposed penalty.
18 3R. STELLO:
Because in that case it is of lesser 19 importance f rom the safety point of view.
The opportunity 20 to have the licenseo present, which is what happens in a 21 proposed action, his side of the story, and to th e extent 22 that we might modify our action, that the final action, 23 which is the imposition of the civil penalty itself, is what 24 is announced, and it allows an opportunity to take into 25 account what the licensee has said related to the issue.
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15 1 could include, at least conceivably, full mitigation.
2 CHAIRMAN PALLADINO:
I have a feeling that if
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3 you're proposing that if you're proposing a dollar penalty 4 that you already have concluded there's some real sound 5 basis for that penalty.
6 HR. STELLO:
That's true.
7 MR. KEPPLER4 I have a point.
In the current 8 policy' there are six soverity levels, and where we have had 9 our biggest difficulties is in those events or problems that 10 fit in severity level three and severity level four.
And 11 there's been a lot of debate about some proposed findings 12 that have been issued, and we have mitigated some of them.
13 Once you go out with a press announcement that 14 licensee is guilty by the fact that the proposed fine has 15 been levied, whether or not you aitigate the thing in total 16 -
and what we have done with the new policy is to combine 17 basically severity level three and four into one severity l
18 and say, instead of it being an automatic civil penalty 19 action, we're going to put it in the mode of tha t 's an area 20 v e 're going to consider very heavily.
21 So it's conceivable to me you may go out with a l
22 proposed civil penalty for that problem in this area, get 23 the licensee 's respense back and decide maybe you won't 24 issue a civil penalty.
25 C05MISSIONER GILINSKY:
You're making it sound l
l ALDERSoN REPORTING CCMPANY,INC,
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1 frivolous, like we go out and say, we'll toss out a penalty 2 and if he comes back with a good reason for what he did 3 ve'll cancel the penalty.
I assume when you're talking 4 about these kinds of numbers you're pretty serious about 5 it..There is at least to your satisfaction a violation that 6 has taken place and you're levying a penalty.
7 And obviously our system allows.the licensee the 8 opportunity to challenge that.
That's h! s right under our 9 rules and the law and so on.
And if we're proved wrong, 10 good, we 'll ch ange it.
11 CHAIRMAN PALLADIN0s What concerns me is we might 12 not make a deep enough investigation, for a category three 13 at least or maybe any of the others, if we allow 14 negotiation, so to speak.
I think when we get to the point 15 of proposing the civil penalty that we should have made a 16 deep enough investigation, an effective enough investigation 17 to be rather sure that, by golly, we're on solid ground in 18 proposing this civil penalty.
I 19 And once you've proposed it, if you're going to 20 follow f or one or two I think it ought to follow for i-21 wherever you're proposing a civil penalty.
22 MR. KEPPLER:
I think tha t 's exac tly the reason 23 tha t bothers me about this.
What this may lead to if we go 24 the route of issuing a press release, it may lead to a 25 negotiation get-together beforehand, and I don't think ALDERSON REPORTING COMPANY. INC.
600 VI9GINIA AVE., S.W WASHINGTON. O.C. 20024 (202) 554-2345
17 1 enforcement ought to be conducted that way.
2 CHAIRMAN PALLADINO:
I wasn't suggesting that.
I r-3 was suggesting tha t the investigation was such that you 4 ought to be on pretty solid ground.
MR. STELL0s I think that's a fair assumption.
5..
6 CHAIRMAN PALLADINO:
I think we have spent more 7 time on this than we need to.
8 MR. STELLO:
When you issue a press announcement 9 and the press announcement identifies the proposed action --
10 and this agency is a very visible agency; it does get 11 considerable media interest.
If you issued an announcement 12 later af ter the imposition which changed in any way, shape 13 or form, it 's not likely that that will have any media 14 interest at all.
15 Let me finish.
The reason for suggesting this was 16 tha t on the lesser important saf ety issues the agency could 17 wait to state its final view because it was lesser, and it 18 was only on that basis of saying, okay, there's at least a 19 basis to wait in this instance.
20 I know scaehow I got pushed into a corner where 21 I'm against motherhood, which is informing the public, and 22 I'm certainly not.
23 COMMISSIONER GILINSKY You used a little 24 Overkill, I think, in defending your view here.
Let me ask 25 you, when we issue a proposed civil penalty doesn't that ALCERSON REPCRTING CCMPANY,INC, 400 VIRGINIA AVE, S.W., WASHINGTON, D.C. 20024 (202) 554-2345
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1 become a matter of public knowledge whether or not we issue 2 a press release?
3 MB. STELL0s Yes.
4 CONHISSIONER GILINSKY:
So what are we talking 5 about?
6 MR. STELLO:
Whether we formally issue the press 7 release or not, and there's a big difference.
8 COMMISSIONER GILINSKYa Well, somebody is going to 9 call you up and interview you anyway, or at least your 10 successor.
And I just d'on 't understand wha t we're thinking 11 about.
12 CHAIRMAN PALLADINO:
I think we've got as much 13 input as we 're going to get on this question.
There are 14 hopef ully some other questions.
15 MR. STELLO4 Let me move to slide 4 16 (Slide.)
17 There's one other change I think I would like to 18 highligh t, and I think the previous two slides identify the 19 cha nges.
One that I think it's important for the Commission 20 to focus on, there is a category called miscellaneous 21 activities now included, which identifies and collects soca 22 of these issues that we've been struggling with in terms of 23 material f alse statements, Part 21 violations and what have 24 y o u.
And there's now a complete brand-new section chat 25 tries to articulate what the policy ought to be for these ALDERSON REPORTING CCMPANY,INC, 400 VIRGINIA AVE. S.W, WASHINGTON, D.C. 20024 (202) 554-2345
19 1various kinds of issues.
2 Yesterday I think I did note that there are issues 3 that can arise where there is an intentional and willful f
4 violation of a regulation or intentional false statement 5 made of one type or another, for which it can become an 61ssue of either license revocation -- and this builds on the 7 concept that there is in fact that kind of' severity that can 8 be behind the issue of having f alse infermation --
'9' COHNISSIONER AHEARNE4 Can se discuss that tosubject?
11 CHAIRMAN PALLADINO:
Yes, go ahead.
I had a 12 question on that.
13 COHNISSIONER AHEARNE:
This is section 7.
The 14 impression I get in reading it, it says, " severity one are 15 very significant violations involving material false 16 statements" -- I'll skip some of the others -
"which, had 17 they been available to the NRC and accurate, would clearly
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18 have resulted in regulatory action."
19 And then severity two is the same type of 20 violation in the absence of management awareness; level 21 three, et cetera.
22 The impression I have is that lying to us about 23 something is not in itself a violation unless the object, 24 the informa tion about which the guy or voman lied to us, had 25 1t been truthful vould ha ve led to some regulatory action, j
ALDERSoN REPORTING COMPANY,INC, 400 VIRGINIA AVE., S.W., WASHINGTON, D.C. 20024 (202) 554-2345
20 1 but lying per se is not a violation.
2 COMMISSIONER GILINSKYa Well, a material false 3 statement doesn 't seen in itself to be a violation.
4 COHNISSIONER AHEARNE:
That's what I'm trying to 5 get at.
6 COHNISSIONER GILINSKY The material f alse 7 statement has the added aspect of materiality.
In other 8 Words, it's talking about something which is material, 9 material being something which we would take into account.
10 HR. STELLO:
Well, material false statement can be 111 ring or not, and it can be an omission or commission, 12 either.
13 COMMISSIONER AHEABNE4 But this said it would 14 clearly have had to have resulted in regulatory action.
15 COHNISSIONER GILINSKY a Let's go back to the VEPCO 16 case of some years ago, where a company failed to supply us 17 with a report which in retrospect turned out to be ine tha t 18 would not have affected our actions, but would have been one 19 that we would have taken into account.
On that basis, we 20 fined the company pretty severely for those days.
21 MJ. STELLO: The fact you would have taken it into 22 account is a regulatory action.
23 COMMISSIONER AHE73NE:
This says would clearly 24 have resulted in regulatory a ct ion.
25 MR. STELLO:
But that severity level'one is trying l
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21 1 to respond to the VEPCO case where it doesn't have to have 2 -- it would have probably been something more appropriate on 3 the severity level three or four, vhich indicated that it 4 v~as a matarial f alse statement, period.
So that's Sincluded.
6 COMMISSIONER GILINSKY:
So you're putting that at 7 severity level three?
8 MB. STELLO:
It would be included in severity 91evel three.
At least my recollection of the VEPCO case is
~10 that's what it is.
11 Now, I was trying to deal with the question 12 Commissioner Ahearne asked me, which is is a lie that has no 13 materiality at all -- I think that would be a violation of 14 our regulation if it were a lie in response to questions 15 that were being asked of an inspector or an investigator, 16and a violation of a regulation is a violation.
-17 Now, if it had no materiality at all, I guess I 18 n ee d --
19 COMMISSIONER GILINSKI4 Then it's not in our 20 system; if he gives you the wrong time of day 21 MB. STELLO:
If he asks you the time and he lied 2:rto you, is that a violation ?
23 COMMISSIONER AHEARNE:
But your sense here is that 24 you believe that you have covered any case that would be 25 significant with respect to a lie told to an inspector?
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1 ER. STELL0s I think so.
~
/
COMMISSIONER GILINSKY:
It may be a severity level 2
3 four.
I don 't remember the case we were talking about in 4 detail, whether management awareness was involved or not.
5 And I'm not sure I know what your definition of that is in 6any case.
7 But it aight actually have tumbled down to 8 severity level four.
9 HR. STELLO:
Frustration of a regulation process 101s a specific regulation in itself.
I don't think it falls 11 1n --
12 CONHISSIONER GILINSKY I'll tell you, what 13 concerns me is whether or not management is aware of any 14 specific false statement to the NRC, it seems to me 15 management does have to take responsibility for a climate in 18 which such statements are made, or take credit for one in 17 which they are not made.
18 MR. STELL0s Agreed.
19 COMMISSIONER GILINSKYs And I think that I guess I 20 would raise these from I guess the basement here to 'a higher 21 1evel.
22 HR. STELLO:
Well, the highest level, do you 23 agree, ought to be when that happens with management 24 awareness?
That is, severity level one.
25-COMMISSIONER GILINSKYs How do you define f
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1 management awareness?
2 MR. STELLos We go through an investigation, prove 3 that management
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4 COMMISSIONER'GILINSKYs Suppose you take a plant.
5 Where would you --
6 MR. STELL0s A plant superintendent, 7
COMMISSIONER GILINSKY A plant superintendent?
8 MR. STELLO: 'Yes.
I could visualize that there 9 could be other eIaments of management which might allow me 10 to come to this conclusion,.
~
~11 COMMISSIONER GILINSKY:
The shift supervisor you 12 would noh put in that category?
/
13 M R.. ' STELL0 s I said I would need more information 14 Def ore I v,ould aAswer.
Tha t 's why I was struggling.
~
15
~~
CHAIRMAN PALLADINO:
It's pretty hard to answer 16 that on a very broad basis because it depends on the 17 responsibility of the in'dividual.
l 18 COMMISSIONER GILINSKY I agree.
But I certainly 19 think tha t mana'gemen t awareness makes it worse, and it works 20 the o the r way, too. But since you specifically put them in 21 bins here and said when management is aware it's at this 221evel and when management is not aware it's at this level, 23 rather than being a flexible factor that you apply to 24 individual cases, then it is important to know what level of 25 management we 're talking about.
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1 MR. STELLO:
But I would need to know a lot more 2 about this particular event before I can ans cer.
3 HR. DIRCKS:
It's so varied.
Then you would have 4 to have a -~
5 COHHISSIONER 3HEARNE:
In B-3 in that same item 6 and C-3, you didn 't seem to have any difficulty.
7 ER. DIRCKS:
I guess the way we can leave this is, 8 if we could get some suggestions we'd be -- I don 't think --
9 if-thera ~ is any innovative language we could pick up, we 10 would stick it in. here.
Why don't we leave it that way?
11 HR. STELL0s I think, having worked at various 12 levels of management, I think the key point is is that 13 individual in a position to make a decision about this 14 matter or must he refer it on up.
If he or she is the 15 ' individual responsible to make a decision on that matter, I 16 would say that's the -- tuat's why I struggled so hard to 17 answer your question without knowing more of the facts, and 18 I don ' t know how to get more guidance in here without trying 19 to write something that's approaching a very large 20 document.
21 COHHISSIONER GILINSKT:
The other side of it is 22 very hard to judge, whether this is something one agrees 23 with or not, unless there are some examples, either real or 24 ima ginary, that you could.e'1gges.t that would give me a 25 f eeling for just what you have in mind.
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1 HR. STELL0s I said if there were actions under 2 the. cognizance of the plant superintendent that he was aware 3 of that were improper, that 's severity level one.
If there g-4 were actions taken by the shif t supervisor which didn't go 5 above him and went only below him and no other element of 6 management was involved, it would depend on what that action 7 might be.
If he were licensed it might be an action against 8 him.
9 HR. DIRCKS:
But now you're talking only about to reactors.
It has to apply to f uel cycle plan ts, to chemical 11 plants, to-reprocessing plants, to anything that goes on.
12 HR. STEL10:
The shift supervisor is licensed.
To 13 use that example, then the action would more properly be 14 directed at him, at he or she and he or she's license.
And 15 the departure then from where we are at this point goes 16 directly to that individual bein.; a licensee at that level.
17 So you have to get up to some level where you are 18 above licensed people, which puts us into anothat element of 19 management.
And I don't really know how to deal with it 20 without the specific set of circumstances.
21 HR. DIRCKSa I think the point is you have tried 22 as hard as you could to get it in here.
If there is a 23 suggestion to make it better, we can sit down and work with 24 it.
25 CHAIBMAd P ALL ADINO One thought might be decision ALDERSON REPORTING COMPANY,INC.
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26 1 level as opoosed to recommending level.
For example, if I 2 have to go to ay boss to get his approval to do something, 3 then I an not really the management level that you're 4 talking about.
But if I am free to make the decision to do 5 something, then --
8 MR. DIRCKSs We can put a footnote under where 7.ve ' re sa ying " management awareness" and - - -
8 CHAIRMAN PALLADIN0s You might try it and see if a 9 word such as that might help.
10 COMMISSIONER AHEARNE:
In the footnote that you do 11 have, when you have a material f alse statement that is f alse 12 by omission or commission, does willf ulness enter into that 13 definition' 14 MR. MURRAI:
Not at all.
15 COMMISSIONER AHEARNEs So that in the soverity 16 list willfulness is another factor thtt gets put on?
17 COEMISSIONER GILINSKYs Where does that come up at 18 all ?
19 MR. STELLO:
Willfulness?
If there is a 20 management awareness of the activity that connotates 21 agreement to ge forward with something that was improper, 22 then it's at that level that it is a severity level one.
23 COMMISSIONER AHEARNE:
Jim has just said the 24 material f alse statement does not -- the question of 25 villfulness doesn' t enter.
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NR. STELLO:
Absolutely not.
But where does it 2 belong in severity level if I have the management gs 3 awareness?
4 COHHISSIONER GILINSKYa So is that your way of
- - - 5 adding wi11 fulness?
6 HR. STELL0s Yes.
7 COHNISSIONER AHEARNE:
Wait.
Thls says a material 8 f alse ' statement with management awareness.
But if the 9 material f alse statement doesn't have wi11 fulness embedded 10 in it, then it's management awareness of the material f alse 11 statemen t.
I don't see that brings in willfulness.
12 HR. HURRAYa Not embedded in it in the sense to be 13 a material f alse statement it has to be willful.
I didn't 14 nean that it couldn ' t --
15 COMMISSIONER AHEARNE:
Oh, it does have to be 16 willf ul.
I see.
17 MR. MURRAY:
No, I say it does not have to be 18 willf ul.
It does not have to be willful to meet the 19 Commission's definition of a material f alse stat 9 ment.
20 But if it is willful and material and false, it 21 can also be a material f alse statement.
22 COMMISSIONER AHEARNEs Certainly.
But it does not 23 have to be.
So I'm still trying to figure out where would 24 willfulness come in as a f actor.
25 BB. STELL0s As I understand material false ALDERSON REPORTING COMPANY,INC.
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1 statement in the previous statements made by the Commission, 2 I could have an act or a f act or information, that g
3 information is such that the whole issue of whether that
- 4 v'as'n't provided to us or wasn't given to us was an act
~ -5 omitted or committed.
When you add that all of that was in 6 f act-known, it was, if you will, not provided to us, that 7 information, by management awareness, that's the 8 villfulness.
9 The material false statement could or could not 10 have it in.
But if management was aware that there was it material, that he had information, data which. suggested that 12 something was wrong, improper, f alse, his application was 13 f alse or actions in the plant or whatever and he was aware 14 of tha t, then that clearly adds willfulness to it.
15 COMMISSIONER AHEARNEs So in your view the 16 statement management awareness indicates more than just 17 aware of a statement that was made or a statement that was 18 not made, but in addition knows that it should have been 19 made?
20 ER. STELL0s Yes, and knows the subject with which 21 the material f alse statement deals.
22 COMMISSIONER AHEARNEs 3o managenent awareness in 23 your view is willf ul not reporting of infornation?
24 MR. STELL0s Yec.
25 COMMISSIONER GILINSKYs Let me ask you this.
Why ALDERSON REPORTING COMPANY,INC.
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1 is not every single case of that severity level one?
2 HR. STELLO:
It is.
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3 COMMISSIONER GILINSKYa No, it's got to be, would 4 clearly result in regulatory action.
And if you've got a 5 management that is lying to us --
6 HR. STELLO:
I guess there is more being read into 7 " regulatory action" than I thought I had read into it.
8 Regulatory action to me is, having produced a review process 9 or an evaluation of the decision, it was okay or it wasn't to okay.
It was information the agency needed to have.
~
11 C0MMISSIONER GILINSKY But we're really talking 12 about material statements, and " material" means something we 13 would take into account.
And by adding those extra remarks, 14 you know, qualifications, accurate at the time and so on, 15 would clearly result in regulatory action, you are 16 suggesting that materiality is not enough.
At least that's 17 what it suggested to me.
18 Now, wha t you're saying is that a deliberate 19 f alsification of documents or lying to us on matters which 20 are material does not in itself go to the top of the heap.
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21 And boy, I think it should.
~
CHAIRMAN PALLADINO:
I don't think willfulness is 22 23 precluded here.
What I can 't understand is whether you want 24 the willfulness in there.
25 COMMISSIONER AHEARNEa My impression is that B ALDERSON REPORTING COMPANY. INC.
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30 1 didn 't see it necessarily in there, but IEE thought it was.
2 HR. DIRCKSs I think it's implied, if you take a
~
3 f also statement and discuss it with management, that there's
'4 some element of v111 fulness.
5 COMMISSIONER GILINSKIs Why don't we deal with it 6 straightforward?
Why don't we say there have been mistakes imade and material false statements which have-been made 8 deliberately?
We just cannot tolerate the latter category,
~ ~9 and' we have talked about this before.
The whole system 10 collapses if we tolerate that.
~
~
11 MR. DIRCKS:
Why don't you take a look and see
~12 wh' ether you can build in people deliberately telling lies
~
13 vill be held in greater jeopardy?
14 COMMISSIONER GILINSKY:
Well, companies, if you're
. 15 talking about management.
16 ER. STEL10:
I will look at taking that phrase 17 "would clearly have resulted in regulatory act'.on" out.
I'm 18 not sure it changes much.
19 COMMISSIONER GILINSKY:
I'm not sure what you 20 meant by it, but it suggested a fairly sharp qualification.
21 MR. DIRCKS:
This is a newly developed section.
I 22 think we developed it in response to much of the concerns 23 the Commission has expressed.
It can be improved and we'll 24 go back and take a look at it.
25 CHAIBMAN PALLADIN0s Do you have any more, Vic?
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1 MR. STELLO:
No, I was-going to quit at that 2 point.
I think I hit what were the major issues that the 3 Commission would be interested in and the more significant 4 changes, and at that point go to answer any questions the
~'
5 Coma 1ssion vants.
6 CHAIRHAN PALLADIN0s I wonder if I could begin 7 with a couple of f actual questions.
It's not clear from 8 reading this document at two different parts what the 9 maximum penalty is.
For example, on page 7 it's the second 10 paragraph that talks about up to the statutory limit of 11 $ 10'0,'000 per violation per day.
Then on the next nage,
~12 almost in the middle of the page it says:
"However, in no 13 instance will the civil penalty for any one violation exceed 14 $ 10 0,0 0 0. "
15 HR. STELL0s Per day.
"16 CHAIRHAN PALLADINO:
Well, you want to add it.
17 Another question has to do with Table 1, which is 18 on page 10.
You have severity levels and then you have 19 categories, and I didn't know what a category was.
It says I'm sorry, I'm looking at the headings 20 "non-category one" proceeding from th e heading 21 and I'm looking at
- 22 " safeguards" it says "non-category one" and " category one."
23 And I do n ' t know what that means and I couldn 't find it in 24 the document.
25 And somehow category one seemed like --
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1 ER. DIRCKS:
We can define what category one is.
2 CHAIRMAN PALLADINOs It's from the regulations.
3 It was important to me because, not knowing and just 4 following your general approach that if something was 5 category one it seemed like it ought to have a higher fine
~6 than if it was non-category one.
And I'm not sure whether 7 -- there 's a lot to understand there.
8 ~~
CONHISSIONER BRADFORD:
It seems like a good 9 question.
Why isn't that the case?
10 CHAIRHAN PALLADINO:
I didn 't know vhat " category" 11 sea ~nt.
12 CONHISSIONER BRADEORDs Category one is a 13 strategic quantity.
14 HR. STELLO:
He's going to get the regulations.
15 The "non" belongs over there.
~
16 ER. DIRCKS:
It's a mirror image.
17
( La ughte r. )
18 COMMISSIONER AHEARNE:
That's all right.
19 Everybody would have known what they were.
20 CHAIRMAN PALLADINO:
There was another question.
21 Suppose you have multiple violations over an extended period 22 of time.
Does this give you any guidance as to what is the 23 maximum that you would go to?
I appreclate that part of the 24 situation may be complicated.
As a matter of fact, it aar 25 be we didn ' t catch it soon enough.
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1 But if there are a number of things that you 2 eventually find and you find out they have been in existence
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3 f or -100 darc, is there any guidance here that tells you what
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5 MR. STELL0s It tells you how to do the per day.
6But I don't think, to answer the question of, does this
' 7 policy in some way say that you are prohibited f rom issuing 8 a civil penalty in excres of I dollars, I think the answer
'9 is no in tha t context.
There is no upper limit.
10 CHAIRHAN PALLADIN0s Well, I don't feel 11 comfortable in not knowing what we would do in a 12 circumstance if you find five violations and four of them 13 were for 100 days and one was for 50 days.
Would you apply 14 the $100,000 limit if that were the limit?
15 BR. STELL0s No, for 100 days, no, not likely.
16 The policy we have been working under is --
17 CHAIRMAN PALLADINO:
Well, why not?
Why wouldn't 18 you do that?
Let's assume no mitigating circumstances 19 except our otn inability to find it.
-20 MR. STELLO:
First, with respect to previous 21 guidance and the way we have been operating, if we were to Z2 p ro pose a civil penalty in excess of $300,000 we would come 23 back to the Commission and explain on what basis we felt 24 there was a justification to go beyond tha t limit in a 25 particular instance.
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2 CHAIRMAN PALLADINO:
Is that in here, the $300,000 3 limit you would come to the Commission?
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HR. STELLO:
Yes.
5 CHAIRMAN PALLADINO:
I missed that.
6 MR. STELL0s That is the policy we've been 7 operating under.
8 CHAIRMAN PALLADINO Is that in here?
9 HR. BICKWIT Yes, it is.
- to NR. STELLO:
With respect to any prohibition en 11 any upper limit beyond that, we have not dealt with that 12 subject ercept a hypothetical example you presented to me 13 results in a civil penalty of $10 million.
Although there 14 may be circumstances for which that clearly is a 15 consideration, it seems very, very unlikely to me that that 16 would arise, that we would ever feel the need to impose a 17 civil penalty of $100,000 a day for 100 consecutive days.
18 But you know, I guess all generalizations are 19 f alse, including that one.
It's just I can't think of an 20 example.
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1 CONHISSIONER BRADFORD:
Vic, while we're still 2 somewhere near Table 1-A, if I'm reading it' correctly, would 3 rou tell me what the penalty would be for materials licensee 4 that gave you a false statement in the course of an 5 inv.estigation, about how many sites containing vaste he 6 happens to have on his property?
7 ER. STELL0s A materials licensee?
8 COMMISSIONER BRADFORD:
Yes.
9-NR. STELLO:
By definition, the theoretical is 10 $jo,0.,000. The discretion is there to go that high.
11 Depending on the circumstances, the number would be for 12 severity level 1 it would be $1000.
13 COHHISSIONER AHEARNEs Well, it depends on -- you 14 said materials licensee.
15 COHNISSIONER BRADFORD:
I'm saying the materials 16 licensee.
17 HR. STELLO:
I assume you meant the last one.
18 COHHIS3IONER BRADFORD:
Somehow we seem to be 19 coming out at variance using this table with the experience 20 we've heard about just in the last 24 hours2.777778e-4 days <br />0.00667 hours <br />3.968254e-5 weeks <br />9.132e-6 months <br />.
21 HR. STELL0s I suggest that there is discretion to 22 allow that to go up to $100,000.
23 CHAIRHAN PALLADINO:
I don't understand that 24 $ 100,000 limit, because then you say you can go to 1007.
25 above that.
So which is it?
Is it $100,000 per day?
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1 COHNISSIONER AHEARNEs
$100,000 per day is limited 2 by law.
3 CHAIRMAN PALLADIN0s So when you have something 4 like $100,000, I presume that's per day.
Then here it says
,5 yo.u can go up 100%.
You can't go up 100%?
6 COMMISSIONER AHEARNEs No, no, this table down 7 here is really to tell you what is the basis for the 8 Category 2, 3 --
9 CHAIRMAN PALLADINO:
I know, but it's always 10 limited by the $100,000, that's an absolute limit.
11 HR. STELL0s That's correct.
12 CHAIRHAN PALLADINO:
So you can't vary it 100%
13 except within those limits.
14 HR. 'TELLO:
Except within those limits, that's s
15 right.
16 COHNISSIONER GILINSKY:
What's the significance of 17 the table, then?
18 COHNISSIONER AHEARNE:
The upper table talks about 19 the base for severity 1, and the bottom table is now to tell 20 you what are the appropriate bases for Categories 2, 3, 4 21 and 5.
22 CHAIRMAN PALLADINO:
That's the other thing that 23 You go 100%?
24 HR. TH0HPSON:
If Mr. Ahearne's interpretation is 25 correct in the way we wrote it, that bottom portion
_s to ALDERSON REPORTING COMPANY,INC, 400 VIRGINIA AVE., S.W WASHINGTON. D.C. 20024 (202) 554 2345
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1 not apply to the severity levels.
The-e is the narrative j
2 that does state plus or minus 100% on the severity level 1 3 for the large licensees.
That carries you over $100,000 4 which is the statutory limit.
5 COHHISSIONER GILINSKY How does it apply to the 6 bottom of that table where it's 51000 or 560007
~'
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g HR. STELLO:
Normally it's plus or minus 100%,
7 8 which could you take you to a factor of 2 higher.
But 9 there's a blanket statement 'of discretion if something was
, to particularly egregious or if there was a need, you could go 11 up to $100,000.
There 's no prohibition in law that prevents 12 you from doing that.
13 This policy is trying to, you know, tell you what 14 to dos hopef ully, most of the time to guide you.
15 COEHISSIONER GILINSKYa But I thought that most of
. 16.t h e -- you don't f eel that's a commitment to state whether 17 or not --
18 HR. STELL0s The law allows you to go to 19 5100,000.
There's nothing in this policy -- if you have 20 something particularly egregious, to use the full f orce of 21 the law.
22 COMMISSIONER BR ADFORD:
But it is true that on the 23 f ace of the policy, using this table for the case we were 24 talking about, you would come out at 5007 25 ER. MURRAY:
You'd come out at 4000, I believe.
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38 gs 1 You 've got the 8000 and you've got the severity level 3.
2 COHNISSIONER BR ADFORD:
You would consider them an
('
31nd.ustrial user rather than under the estegory of other 4 aaterials licensees?
5 HR. STELL0s There are other f actors you apply if 6 it's particularly egregious, which is above th'ese.
7 CONHISSIONER BRADFORDa Which is,what would get 8 you from 400 or 500 up to --
9 HR. STELLOs Right.
10 CHAIRHAN PALLADIN0s Can I still come back to my IIquestion on the limit of $300,0007 It says under --
12 incidentally, this is comments which I didn't think were 15 part of the policy.
It says, " Currently, the policy calls 14 f or Commission review when..."
Then it says,
...the civil
~
15 penalty for a single violation exceeds 5300,000."
16 What I'm saying is why shouldn't that be in the 17 'p olicy ?
18 YOICEs It is.
19 CHAIRMAN PALLADINO:
Where?
Just only by the 20 question and answer?
21 MR. THOMPSONs On page 15 of the policy itself you 22 will find a discussion of the conditions under which we i
23 notify or consult eith the Commission on actions.
Item 2 24 towards the top of the page.
25 MR. STELL0a It's three times severity level 1 l
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1 values.
Page 15.
2 HR. THOMPSON:
Of the policy itself.
3 HR. STELL0s In the policy.
7 4
NR. THOMPSON:
There are four cases where we will 5 always come to the Comaission.
6-CHAIRMAN PALLADINO:
Okay, thank you.
7 COHNISSIONER GILIESKY:
Let me get back to that 8 Table 1-A.
Let's take a case that we haven't dealt with, i
91et's take a test reactor or whatever.
And suppose that you 10 decide that the violation was so severe that it ought to 11 exceed 100% above $10,000; it ought to be, I don't know, 12 $25,000 or $40,000.
How much of a case does someone have in 13 coming back to us and saying wait a minute, you agreed on 14 certain guidelines and you 're going way beyond these 15 guidelines.
And, you know, sure, you have the discretion
- ' 36 unde the law, but you agreed to put certain limits on what 17 you are going to do.
I t%" nk there 's no question but that 19 there is come inhibiting effect in establishing the policy.
20 It 's not a legal effect but it could be viewed -- I'll turn 211t over to Leonard -- by a reviewing court as reflecting 22 some abuse of discretion if it weren't independently 23 j us tifia ble.
24 MR. BICKWIT:
Agreed.
25 MR. STELLO4 Indepdently justifiable means it was AlCERSON REPORTING COMPANY. INC.
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s 00 I
1 very serious.
2 MB. MURRAY:
Yes.
If you had a particularly
('
3 egregious example that the policy itself specifically 4 reflects that in those cases we can go above.
I don't think ilyou can predict in advance, or it's very difficult and we 6 haven 't been able to, exactly what every individual case is 7 going to look like to set the rules for.
8 COMMISSIONER GILINSKY Okay, so we have a-certain
- 9 base penalty.
But in attaching the plus 100:: to it, I would 10 assume -- and I would think most people would assume -- that 11 ' a't covers the range of cases up to pretty bad cases.
12 MR. BICKWIT:
There's a reference in the policy 13 itself to special circumstances allowing you to depart from i
14 these principles, and tha t would certainly be relied on in 15 'a n'y s'uit of the nature you are posing.
~
16 ~
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MR. HURRAY:
That would be an exercise of 17 discretion when you departed from it, and any exercise of 18 discretion will be judged whether it's been abused or not, 19 and tha t 's going to depend on the particular circumstances 20of the exercise of the discretion.
21 MR. BICKWIT:
On page 1 it says, "Each enforcement 22 action is dependent on the circumstances of the case, and at 23 f ar as emphasizing discretion, after consideration of these 24 policies and procedures."
25 CHAIRMAN PALLADINCi Can I ask a couple note ALDERSON REPORTING COMPANY,INC.
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1 questions?
At some places -- and I'll have to look here --
2 at some places thay are called, I guess, Supplement Number 4 3 severity categories.
It talks about very significant 4 violations involving whole body exposure of a number of the
.5 public in excess of two and a half reus radiation.
And in 6 some places it talks about half a ren.
7 For example, when we come to transportation it's a 8 half a ren, and they are both severity 1, and somehow they 9 don 't seen consistent.
10-COHNISSIONER AHEARNE:
Well, add to the
- 11 inconsistency the half a tem annual whole body radiation 12 exposure to member of the public in excess of 0.5 rem for 13 trant.;portation is severity level 1,
and for health physics 14 the exact same statement is severity level 2.
15 CHAIRMAN PALLADINO:
Okay, that's another way of 16 putting it.
17 HR. KEPPLER:
When we were here for the first 18 go-around, 19 COMMISSIONER AHEARNE:
(Ina udible. )
20 (Laughter.)
there was a question as to 21 ER. KEPPLER:
1 l.
. 22 whether or not there should be an absolute gradation.of l
23 severity levels or relative gradation of severity levels.
l 24 And because of the emphasis, the experiences and the 25 emphasis the Commission wanted to give to certain areas such ALDERSON REPORTING CGMPANY,INC.
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1 as construction, transportation, we agreed to achieve a 2 higher level of compliance, that we would make severity
(
3 levels 1 and 2 for these areas, recognizing that the actual 4 saf~e'ty importance of the violations may not be as great as 5 perhaps a severity level 1 in reactor opera tions.
6 So it's my recollection that it was a conscious 7 decision to go this way, and it's one, by the way, that was 8 discussed heavily in the comments as to whether or not we
~
9 should have an absr.
t.e severity level between categories, 10 or relative severity level.
11 Let me just add if you take, for example, a 12 severity level 1 for reactor operations where you have an 13 actual health and safety problem occurrence, it's very hard 14 to place a severity level 1 for construction in the same 15 category because you really don't have an imminent health
~
16 and safety concern at a construction site.
So you may not 17 -- if you vent with an absolute standard, you may really 18 start out, then, with your highest category in construction 19 being a severity level 3, for example.
20 CHAIRMAN PALLADINO:
That's not necessarily 21 v ro ng.
What I'm a little worried about is that e verything 22 -- what normally we might consider a relatively minor 23 incident now gets to be sevei-ity level 1, and it masks the 24 importance of a severity level 1 in a reactor.
25 MO. KEPPLERs Well, I will say this.
My reaction ALDERSoN REPORTING COMPANY,INC.
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43 1 to that aspect of the comment was that we really don't have 2 any severity level 1's in transportation.
Over the period 3 involved, we didn ' t have any severity' level 1's in 4 construction that I'm aware of.
5 So it's really, I think, shown -- my personal view 61s that it does offer the opportunity to show that the 7 Commission places a high level of importance on these 8 matters, and I don' t think it masks the other aspect of it.
9 CHAIRMAN PALLADINO:
Should there be a T-1 for 10 transportation, so you have some flavor that these are not 11 of equal importance?
12 MR. KEPPLER.
We tried to say that in the body of 13 the document.
Maybe we could --
14 CHAIRMAN PALLADINO:
It seems strange there should 15 be that much' variation.
I can see the value of relative 16 priorities, but somehow one that is interested needs to knov 17 that they don't --
18 COMMISSIONER AHEARNE:
I'll have to admit that 19 putting it so clearly you have weeded out the inconsistency.
20 MR. KEPPLER:
I don't think it's all bad.
21 CHAIRMAN PALLADINO:
No, maybe an easy var out is l
^
22 to say that 's a priority level.
I hestitate to make the 23 suggestion because I haven't thought it through that far, 24 but maybe you want to consider something like T-1 or 25 wha tever.
l l
ALDERSoM AEPORTING COMPANY,INC.
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1 Now, one of the probleas we have had in past 2 enforcement accidents, or at least one that I think we have 3 had, is when do you take these enforcement actions.
Should 7
.4 the policy statement set forth a timetable for enforcement 5 actions?
And what sort of timetable might we want to 6 consider?
I'm really throwing this out as questions.
7 MR. STELL0s It's not in there.
That ought to be 8 procedures that are followed by the office.
We have tried 9 very hard to get our enforcement actions down to 30 days.
10 That's a very, very difficult --
11 CONNISSIONER GIIINSKYa Thirty days after the 12 event?
13 HR. STELL0s Thirty days after the report.
14 Identification is a better way to say it, and that's very, 15 very difficult to do.
Some of them are fairly complex.
You 16 may have the problem identified months and months before you 17 have finished.
18 CHAIRMAN PALLADINO I agree, maybe you don't want 19 a timetable in the policy statement, but we ought to have 20 some guidelines somewhere.
21 Let me ask one more and then I will let others go 22 o n.
Under Facility Construction it talks about severity 1 i
23 applies only when a structure or a system has been 24 completed.
Now, should severity 1 also apply when a 25 structure or system could be completed in such a manner that ALDERSON REPORTING COMPANY,INC, 400 VIRGIN!A AVE., f,W., WASHINGTON. D.C. 20024 (202) 554-2345
86 5 9
J 1 it would not have been -- would not have satisfied its 2 intended safety-related purpose?
If you have to wait before
.3 rou can give it a severity 1 until everything is complete it
_4 sounds to me that we have waited too long, especially when 5 there's something along the way.
And we should identif y it
..e.as a very severe situation that we want to change before it 7 g.ets completed.
8 HR. STELLO:
Mr. Chairman, I think that's probably 9 very difficult to do.
You could have a designer that makes 10 a vary simple error in a design or calculation, and the
. 11 whole procedural process -- that's the QA system itself --
12 would be operated to find it, but at the time you find that
- 13. error, if that had been constructed it would have been a 14 major problem.
You have not allowed the rest of the system 15 to do its job.
16 I would find it very hard.
17 COMMISSIONER GILINSKY:
But suppose somebody lied 18 to, us along the vay?
19 MR. STELLO:
I don't see the connection.
20 CHAIRMAN PALLADIN0s Well suppose there were false l
21 records?
l 22 MR. STELL0s I thought your question was if they 23 were constructing some thing and there was one place in the 24 process where if it had gone into construction and been 25 built, it could create that problem.
I say if you try to go ALDERSON REPORTING COMPANY,INC, 400 VIRGINIA AVE., S.W. WASFINGTON, D.C. 20024 (202) 554-2345
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1 into the system at any other point, you are, in a sense, 2 removing a very normal part of the process which would look 3 at the design review and audit and many things that are 'one 4 prior to the construction that should, in f act, design to
. _.5 catch, the problea.
6 Now, I don't see how lying co us --
7 COSMISSIONER GILINSKY:
I guess I misunderstood 8 what you have in mind.
Does the restrictions on 9 construction simply not apply to your supplement 7?
10 MR. MURRAY:
That's right.
A lie would be judged 11 under supplement 7, not under supplement 2, even though it 12 occurred during construction.
13 COMMISSIONER GILINSKY:
Good enough.
14 COMMISSIONER AHEARNE:
Let me follow this.
When
, 15 you say completion your footnote has acceptance by the QA 18 organization, indicating that the structure is ready for 17 pre-opcrational testing.
18 ER. STELLO:
Yes.
19 COMMISSIONEB AHEARNE:
Now let's take, for 20 example, building a containment.
When you say accepted and i
i 21 ready for pre-operational testing are you saying that the 22 whole structure is now complete, the whole containment has 23 been built and they are ready for pressurization tests?
Is 24 tha t the point that you would feel that until that point you 25 could never get severity 17 l
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MR. STELLO:
No, there are acceptances long before 2 that.
3 COMMISSIONER AHEARNE:
There are acceptances long 4-before that but the first pre-operational testing --
5 CHAIRMAN PALLADINO:
Maybe I'm misunderstand you, 6 Vic, but I could picture situations where they're doing 7 things wrong and you say, My God, we can't allow that.
But 8 it isn 't completed.
9 MR. KEPPLERs But they would be taken care of 10 under severity level 2 or 3 where there are breakdowns in 11 the quality assurance program of that activity.
12 CHAIREAN PALL 1DINO:
It may not be quality 13 assurance; it may just be that the fellow was doing it wrong.
14 NR. KEPPLER:
That should be called as part of the
- 15 quality assurance.
16 MR. STELLO:
Look at the normal process that's 17 going on.
You have an architect-engineer and a constructor 18 and many other subcontractors supplying equipment.
The 19 subcontractor is building a subassembly which is improper.
20 He comes to the site and there are ncrmal QA precesses that 21 m-ight be on as part of the constructor or AE, where even the 22 Licensee rejects it.
So it never went in.
23 The example you give would suggest that you could 24 say that 's severity level 1,
let's take it all the way to 25 the point where it was installed and it's sitting in the ALDERSON REPORTING COMPANY,INC, 400 VIRGINIA AVE., S.W., WASHINGTON D.C. 20024 (202) 554-2345
08
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1 plant actually installed in there.
But as part of the 2 licensee 's program to go in when that system is being turned 3.over -to him, he has a procedure where he goes through all g,
4 the ' records to be sure that everything is done the way it 51s, and he said, you installed that in there the wrong ways 6 please take it out and put it in right.
7 I think what you want to do is make sure that the i vhole system has had a chance to operate before --
CHAIRHAN'PALLADINO:
Let me give you an example.
9 T
10 Tou have velds to be made, and surreptitiously to save time 11 the-fellows are just laying the veld rods in there, and it 12 goes 'on and you finally catch it.
But the whole system 13 isn 't complete and you say, by golly, that is a very severe 14 sit'uation.
And you might want to call it severity level 1 15 but you can ' t do it yet because the system isn't finished 18 and you don 't want it to come along that way.
And this kind 17 of thing has happened.
18 COMMISSIONER AHEARNE:
The mitigating factor there l
19 would probably be that you might make them go back and tear 20 out a lot of this stuff.
21 CHAIRMAN PALLADIN0s True, that's exactly what you 22 d o.
l 23 MR. STELL0s I think I understand your problem.
24 Enforcement is not just civil penalties.
If we saw l
25 practices such as that, we have a lot of other tools in our ALCERSON REPCRTING COMPANY. !NC.
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1 box that we can use.
One of them that we could pull out is 2 an order that says " cease and desist."
3~
If the kind of problem you described is going on, 4 ~t h~e n i t would seem to me that maybe the enforcement tool is 5 stop.
Not a civil penalty.
6 CHAIRMAN PALLADIN0s I agree, but if you follov
' 7 that, you would never have any civil penalties.
I'm sa ying 8 if you find that there ought to be some opportunity or some 9 caveat or enough flexibility so that.you 're not excluded to f rom calling something that 's major a severity level 1.
' 11 '
HR. STELLO:
Okay.
But I guess what I'r. trying to 12 suggest is there are a variety of enforcement actions, and 13 whenever something happens that the totality of the 14 enforcement process has to be considered.
Your example 15 suggests to me practices gcing on in the plant that cannot 16 be' tolerated under any circumstances and they have got to be 17 stopped.
18 CHAIRMAN PALLADINO:
But now if you stopped them 19 and I can't penalize them --
20 HR. STELLO:
Oh, you did.
The minute you stopped 21 them you killed them.
22 CHAIRMAN PALLADINO:
Yes, I know, but they get 23 started again and fix it up, and I'm not sure I've gotten 24 management attention to the severity of this kind of problem.
25 MR. DIRCKS:
I think we can take account of that.
ALDERSON REPORTING COMPANY,INC, 400 VIRGINIA AVE S.W WASHINGTON. D.C. 20024 (202) 554-2345
50 I
1 CHAIRMAN PALLADINO:
Okay, why don't_I let 2 somebody else go on?
~
3 COHH13SIONER AHEARNE:
First a question for you,
{"
4 Joe.
Do you intend to reach final approval of this today?
5 CHAIRHAN PALLADINO:
No.
I thought after we're 6 through we ought to see what may develop out of this, 7 because I think because I think we will want to vote.
8 COHHISSIONER AHEARNE:
Okay, because I had.severa) 9 minor questions --
10 CHAIRHAN PALLADINO:
not today.
11 COHHISSIONER AHEARNE
-- that I might just as 12 vell put into a piec.t-of paper and send to Victor.
They are 13 not anything significant.
(
14 One, I would like an explanation.
In_the comments 15 and response section that you have you have commented on 16 implemen ting the poli.cy, NRC should follow requirements of 17 the Regulatory Flexibility Act; responses the policy is not 18 subject to the act.
And maybe a word or two about why would 19 help tremendously.
20 HR. KEPLER:
There are two reasons, Commissioner 21 Ahearne.
First is this is not a regulation and therefore it 22 would not be subject tc regula tory flexibility.
And second, 231t wasn ' t a regulation ; it was proposed prior to the 24 effective date of the Regulatory Flexibility Act.
25 COHHISSIONER AHEARNE:
So it's not that if it were 1
ALDERSON REPORTING COMPANY,INC, 400 VIRGINIA AVE., S.W., WASHINGTON, D.C. 20024 (202) 554-2345
f 51 e
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1being put out now, your second argument for being out now;
' 2 it would be subject 3
MR. KEPLERa If it was being put out now as a 4 statement of policy it would not be applicable.
If it would
-5 be ~put out now as a binding, regulation then it would be.
/
6 COMMISSIONEB AHEARNE:
And there.the distinction
~ 71~s policy versus regulation?
8 HR. KEPPLER:
Bight.
9-COMMISSIONER AHEARNE:
You have struck the
.10 references to operator civil penalties, and essentially I 11 think have left either neutral, or the impression that 12 pending further Commission review and decision you won't 13 take. action against operators.
Could you say a few words 14 w hy you took,the operatos section out?
15 MR. SIELLO: -That was an a rea that had 16 considercble comment.
I see leaving it neutral, which is 17 what I think it is, h.tving a significant benef t in easing 18 the tension that's present in the licensed operators.
I see 19 no need at this point to add to that process.
20 COMMISSIONER AHEARNE4 Do you vie's the taking out 21 -- is th at e quivalent to scaing that the enforcement policy 221s such that we will not take actions against individuals?
23 MB. STELLO:
No, it's on a case by case basis.
24 COMMISSIONER AHEARNE:
Okay, but you're not 25 equating it to --
AI.DERSON REPORTING COMPANY. INC.
400 VIRGINIA A%E., S.W WASHINGTON. D.C. 20024 (202) 554-2345
52 1
COMMISSIONER BRADFORDs Does it say that anywhere?
e 2
CONEISSIONER GILINSKIs You were asking that and I 3 mentioned it.
Joe, why isn't there a supplement covering
/
4 individual licensees?
5 CHAIRMAN PALLADIN0s I thought it was in there 6 because I was interested in that.
7 CONHISSIONER AHEARNrs The statement in response 8 says enforcement actions for licensed operators will be 9 determined on a case-by-case basis.
Now, there's a 10 statemant somewhere else in the policy itself which I 11 tho.ught lef t a slightly different impression.
12 CHAIRMAN PALLADIN0s I think it's on page 2 of the 13 policy statement, if I'm reading right.
_14 MR. STELL0s They are covered in that supplement 7 15 to.the extent they are licensed.
COMMISSIONER GILINSKYs That's all material false 16 17 statemen ts.
18 MR. STELL0s Ther:re covered by those --
19 COMNISSIONER GILINSKY That just deals with i
20 material f alse statements.
That's something I've been 21 interested in, but there are all sorts of other possible l
l 22 violations.
l 23 HR. STELLO:
That's true.
l l
24 MR. KEPPLER:
If they are materials licenses it l
l 25 would be covered under the materials license supplement.
l l
l ALDERSON REPORT.NG COMPANY. INO.
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CONH7.SSIONER AHEARNEs Let me go on and ask 2 another questior..
.3 NH. STELL0s Let me just say it was a judgment
,e 4 tha t we were best off leaving it out for now.
If the 5 Com. mission wishes, we will add it.
6 CONHISSIONER AHEARNE:
The flavor I got in the 7 policy statement itself was that it would be done on a 8 case 'y-case basis, but pending furtser Commission action it 9 will be done.
10 11 12 13 14
.. 15 16
, 17 18 19 20 21 22 23 24 25 ALDERSON REPORTING COMPANY,INC.
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HR. STELLO:
If there is such a statement, we'll 2 take it out.
3 COHEISSIONER AHEARNE:
The issue on nonprofit 4 hospitals and other nonprofit institutions, in going through 5 the package of comments I was struck by the very large 6 number of hospitals that responded.
I had expected a lot of 7 utilities to respond.
8 Could you say a few words about why the hospitals 9 seemed to be so upset and concerned, perhaps either comments 10 tha't you have or --
11 HB. STELLO:
We have taken some action against 12 'h os pit als.
13 COMMI,SSIONER AHEABNE4 I understand that.
But the M flavor at least from the comments seemed to go beyond what I 15 would have expected.
It was almost as though the attitude 16 was they were surprised to find tha t they were subject.
17 HR. THOMPSON:
I can respond to that, Commissioner 18 Ahearne.
In the course of the public meetings -- and if you 19 look through the enclosure three --
20 COMMISSIONER AHEARNEs I did.
21 NB. THOMPSON 4
-- you vi.11 find that not only are 22 there a number of hospitals, but a substantially larger 23 number of hospitals that commented f rom the Midwest than any 24 other portion of the country.
25 There's also a particular commenzer who made an At.DERSON REPORTING COMPANY. INC.
400 VIRGINIA AVE., S.W., WASHINGTCN, D.C. 20024 (202) $54-2345
55 1 appearance at the Chicago meeting, who is very active in 2 consultant work with hospitals.
Based on information he 3 provided at the meeting on the nature and wording associated 4 with the comments from the hospitals, we are convinced that
'S th'ere was a concerted effort on the part of this particular 6 consultant to marshall his clients in a write-in campaign
~7 where they shared his views, and obviously they did share 8 his views, that we were now establishing something new that 9 did not exist before for riedical licensees.
10 We don't think that squares with the situation
~
11 that pre-existed or exists now, but it does help to explain 12 the large number of commenters that are in parallel.
13 COMMISSIONER AHEARNE:
As I said, that was the 14 [lavor I was getting through here, that they were expressing 15 great concern that we were going into an area that we had
~
16not gone into before.
And I would suggest on these comment
~
17 responses that we go out with that some of that gats picked 18 u p, because really throughout here when you read the 19 hospital positions the flavor is, hold off for a t least 20 another six months, you've hit us with something we never 21 realized we were liable for, this is a whole new area the
~
22 NBC is going into, which isn't true.
23 ER. THOMPSON:
That's not uniform from all the 24 hospital responders.
Some of them recognized they had been 25 and continue to be vulnerable to actions.
But they didn't ALDERSON REPORTING COMPANY,INC.
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1 like the nature of the actions ve were proposing.
2 COMMISSIONER AHEARNE:
You mentioned in your 3 comment response the comment was, any civil penalties 4 imposed on nonprofit hospitals or nonprofit institutions 5 would have to be paid by increasing charges to the public.
8 In response you say Table 1 has been modified to address 7 this concern.
8 Could you say a few words about how Table 1 was 9 modified to reflect that concer'n?
to MB. THOMPSON We addressed it in terms of the 11 reflection of ability to pay in general, which of course 12 does not apply across the board.
There are some very large 13 nonprofit organizations.
But in general, medical 14 institutions and nonprofit organizations we did put into the 15 table at a different peint to indicate we recognize the 16 ability to pay.
17 COMMISSIONER AHEARNE:
The $4,000 figure is lower 18 than what it used to be.
19 MR. THOMPSON:
I believe that's correct.
I would 20 have to check my notes.
I belie ve tha t 's ccrrect.
21 COMMISSIONER AHEARNE:
Well, let's see now.
That l
22 point is because a nonprofit institution has to flow its 23 charges back to the public.
Now, would tha t also hold true 24 for TVA?
Would you reduce your penalties for them?
25 MR. THOMPSON 4 It 's a valting his judgment.
l ALDERSoN REPORTING COMPANY,INC,
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(Laughter.)
2 COMMISSIONER AHEARNE:
I was just wondering, are 3 there other municipal --
~
4 NR. STELLO:
TVA is not considered as a 5 nonprofit.
It's a power reactor.
6 COMMISSIONER AHEARNE:
What about SHUD?
7 MR. STELLO:
They are not a nonprofit 8 organiza tion.
They are a power reactor.
~~
~
~
9 COMMISSIONER AHEARNE:
Okay.
But what this says, 10 the comment is any civil penalties imposed on nonprofit
~
11 hospitals or other nonprofit institutions would have to be 12 paid by' increasing charges to the public.
Table 1 has been 13 modified to address this concern.
The Commission does not 14 desire to increase consumer cos..
15' HR. DIRCKS I think the footnote on that 1-A says 16 nonprofit institutions includes academic, medical and
'~'
17 nonprofit institutions.
18 COMMISSIONER AHEARNE:
Yes, to nonmaterial 19 licensees.
I think you'd better expand --
20 HR. DIRCKS:
?ine.
We 'll just say nonprofit.
21 I'll make it clear it's material licenses.
22 CONHISSIONE3 AREARNE:
I guess this probably has 23 now been explained, but on page 4,
the last paragraph, for 24 enf orcement actions you say the severity level of violations 25 involving the failure to make a required report vill be ALDERSoN REPORTING COMPANY,INC.
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1 based upon 'he significance of and the circumstances 2 surrounding the matter.
-3 Are you there specifically speaking to material
'4 f alse statement issues that we've just discussed?
-5.
MR. STELL0s I wasn't following that.
-6 HR. THOMPSON:
The prior policy the staff had used 7 prior to the interim policy was that failure to report would 8 be regarded with the same seriousness as the event not 9 reported.
Following Commission guidance given to us on the 10 interim policy and consistent now, there are reporting 11 situations which under the revised policy and under the 12 interim policy can be treated as more serious than the 13 e ve n t.
14' Yes, to answer your question more directly, I 15 think it is both' the material f alse statement and the 16 reporting which may not be involving caterial f alse 17 statements.
18 COMMISSIONER AHEARNE:
So you would view, then, 19 that this statement allows you to increase rather than to 20 decrease the penalty due to the f ailure to report?
21
- 52. IHO5PSON:
I think it could work both 22 directions, but it does provide the lattitude to regard more 23 seriously the failure to report than the event not 24 reported.
But it could work downward as well.
25 COMMISSIONER AHEARNE:
Okay.
On page 5, the ALDERSON REPORTING COMPANY,INC, 400 VIRGINIA AVE., S.W., WASHINGTON. D.C. 20024 (202) 554-2345
59 1 paragraph directly above " civil penalty," you say:
2 " Licensees are not ordinarily cited for violations resulting 3 f rom matters not within their control."
(
4-Would you explain that a little bit?
-5 MR. THOEPSOEs In the interim policy that 6 statement was included as well, with an expansion clause 7 that says, "such as a faulty design, installation, 8 maintenance procedures," a number of those.
And a former 9 colleague of yours commented specifically that that was not 10 what he envisioned when we provided that out for licensee 11 control.
- 12 We have left out the qualifying clause in the 13 revised policy, in an attempt to respond to that commenter.
14 -
COMMISSIONER AHEARNE:
Well, that now eliminates 15 the qualifying clause, but what do you mean by " matters not 18within their control."
17 3R. THOMPSON:
We do believe that acts of God are 18 included.
They are really unquestionably beyond the control 19 of the licensee.
20 MR. STELLO:
The problem was before you had 21 equipment f ailures and then you had except for those caused 22 by everything that can cause equipment failure.
And the 231ntent was that you really can have equipment failures that 24 the licensee has really done everything reasonable in 25 maintenance and design and everything else. and it breaks, it ALDERSON REPORTING COMPANY. INC, 400 VIRGINIA AVE S.W., WASHINGTON. D.C. 20024 (202) 554-2345
1 60 1 vears out.
It's out of his control if something breaks and 2 leaves a piece of equipment inoperable.
3 COMMISSIONER BRADFORDa Can I just add, while 4 ve're on this subject of the former colleague -- how did you 5 happen to decide, not that I mind, to treat Commissioner 6 memoranda as comments?
7 NR. THOMPSONa When we were establishing the 8 docket, Commissioner Bradford, we arranged downstairs for I
9 av;erything that came in on the interim policy to be dock'eted
- 10 and assigned a number.
And it so happened that the sequence
.11 in which Commissioner memoranda arrived to be docketed --
12 they wanted it docketed on this subje.t and it was assigned 13 a number, no significance to it at all.
14 CONHISSIONER BRADFORD:
It wasn't so much the 15 assdgning of the numbers as just the inclusion of them among 16 the public comments.
I thought that mine, and I don't know 17 about Joe's, had been circulated before the policy went out 18 ad was commented, and the provisions of it that woie adopted 19 or not adopted by the Commission before we ever put the 20 thing out.
l 21 MR. TH0HPSON:
It was simply the administra tive 22 procedure of putting them all in one document.
We attached 23 no greater significance 24 (Laughter.)
25 COMMISSIONER BRADFORD:
That was clear.
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1 MR. THOM~ SON:
We anticipated if you wished to P
2 speak ex cathedra it would be in a session such as this.
7-3~.
CONNISSIONER BRADFORD:
There is nothing ex
(
4 cathedra about this.
5 COMMISSIONER AHEARNE:
Page 9.
Let me read this 6 section and then tell you what -- or ask the question.
You 7 say:
"However, to emphasize the focus on the fundamental 8 underlying causes of the problem, the cumulative total for
' 9 all' violations which contributed to or were ' consequences of to the problem will generally be based on the amount shown in
~
11 the table as adjusted.
If an evaluation of such multiple
~
12 evaluations shows that more than one fundamental problem is 13 involved, then separate civil penalties may be assessed."
i 14 The impression I get from this is that even if 15 there were many serious violations, that if you can trace 16 that back to a single cause theu you will only give one 17 penalty.
And the reason seems to be to emphasize the focus 18 on the f undamental cause, which then shifts from th e 19 seriousness of the effects.
23 NR. STELLO:
Let me tell you what the intent was.
21 The intent was that our enforcement actions ought to got and 22 deal with the fundamental causal problem.
If there are 23 problems, then we try to arrange the enforcement actions to 24 deal with the two or three or whatever number of problems 25 there are.
ALDERSON REPo,4 TING COMPANY. INC, 400 VIRGINIA AVE,, S.W., WASHINGTON, D.C. 20024 (202) 554-2345
62 1
In each case, you could have examples that fit and 2 'deaonstrate where the weaknesses are or wh'ere the probles
~
"was.
I want to make sure that our enforcement action and 4 letters and everything point to a clear understanding of 5 what it is the licensee really has to fix, what the
-6 vrongness is. That's the reason for that kind of language.
7 It does not suggest that if you had a laundry list i
8 'and you could identify this whole laundry list and there are
' 9 just too many things that are wrong such tha*. 0A is a major
~
10 problem, but everything is in violation of Appendix B, with 1130.or 40 examples, that that all has to be treated as "one 12 violation."
No.
13 Again, two points are being made.
One is the 14 total of the enforcement action and the other is the civil 15 " penalty.
But in all cases, trying to make sure that we got l
iG to the underlying problem or thing that was happening.
17 '
COHNISSIONER AHEARNEa Okay.
I have to think 18about that a little bit.
I understand the.7oint you're 19 making.
I think it can be read somewhat differently.
It 20 can be read that you narrow it -- that it would be in the 21' licensee 's best interest to argue, yes, you found I 22 committed 15 gross: violations, hovesar I just want to point 23 out to you they a:1 stem from this one instance.
24 MR. STELLO:
Oh, no, no.
That wasn 't the intent.
25 CHAIRMAN PA1LADINO:
Or one individual.
l l
l ALDERSON REPoR11NG COMPANY,INC, f
400 VIRGINtA AVE., S.W., WASHINGTON, D.C. 20024( 02) 554 2345
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C0;iHISSIONER AHE ARNE:
Right, and we fired him.
2 (la ugh te r. )
3 CONNISSIONER AHEARNEs You have a statement on
(
.4 page 12 that orders are made effective immediately whenever
.5 it is determined that the public health, interest or safety 6 so requires.
Now, I gather that stems from the f act that 7 that's what the Administrative Procedures Act allows one to 8 say when you make an order effective immediately.
I just 9 wondered whether you had a working definition of the "public to interest" 11 MR. STELL0s No.
Whenever there is a need to get 12 involved with bc'.ancing, that's already another one of those 13 reasons, and then we come back to the Commission if we're 14 going to do that.
The P alance of those other factors will 15 he part of the process by which the Commission got 16 involved.
17 -
NR. MURRAY:
Is that the one that you sent 18 shutting down construction in order to get a handle on the i
19 problem, you tend to lean on public interest because it's 20 dif ficult to lean on immediate threa t to public health and l
- 21 saf ety.
22 COMMISSIONER AHEARNE:
Now, since you raise that, 23 would you expect to be able to read through this document 24 and come up with a conclusion when we would have immediately 25 effective suspension of tr e CP, or would you go elsewhere to ALDERSON REPORTING COMPANY INC.
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1 try to find those guidelines.
2 MB. STELL0s I think after reading the document 3 all you would do is have some sort of f air idea of what that 4 would do.
In terms of any detailed explanation, you can't 6 5 h~av e it in the policy.
I don't know that you can write it
- 6 to do that.
7 COHNISSIONER AHEARNE:
It wasn't clear to me, 8 other than this one particular area, that I could find any
~
-9 guidance on when you would take ~ action for immediate 10 suspension of the CP.
It MB. STELLO4 I think Table 2 gives some specific 12 gu~idance as to that.
If you fall within Table 2, that is 13 very specific.
14 CC3HISSIONER AHEARNE:
Say that again?
Now that 15 is' one I guess you conclude that D or C -- is that it?
C or 16 ') ?
17 NR. STELL0s Those are orders.
D is just any 18 f urther action, which could be any one of a number of 19 things.
Those start to indicate when the orders would issue l
20 and under what set of circumstances.
l 21 COMMISSIONER AHEARNE:
Yeah, but I guess it would 22 have to be D, because C is a show-cause.
As you know, we
~ 23 have before had problems with when do you issue an 24 immediately effective suspension of a CP.
25 MR. STELLO:
It's a very difficult area.
If you ALDERSON REPORTING COMPANY. INC.
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65 e
1 knew they were going to start construction and they were 2 g'oing to pour an awful lot of concrete that might cover it
(
3 up and you couldn't get the licensee to agree to hold that 4 until it was resolved, then I think the public interest 5 would warrant having an order to go out immediately 6 effective and you would consider it.
And there are those 7 kin'ds of exa mples one would have.
But --
8 COMMISSIONER AHEARNE:
On page 13 under "related 9 administrative actions," you says "The NRC expects 10 lic'ensees to adhere to any informal obligations."
What is 11 an informal obligation ?
12 MR. STFL10 We have a meeting with him and he 13 tells us tha t he won 't start up the plant until the 1^ following things are done and he'll call us up and let us 15 k no w.
We expect he's going to do that.
And any time we 16 have a belief that he's not, then what we 're going to do is 17 make those a condition of order.
18 COMh1SSIONER AHEARNE:
But the message that you 19 would expect the licensee or the public to get from this 20 section is that if the licensee makes a commitment, a verbal 21 commitment, I guess, is an informal -- well, it's not quite 22 binding.
But if he doesn't follow through, then you will 23 follow with an order to mCie it binding.
24 MR. STELLO:
Yes.
An immediate action level -- an l
l 25 immediate action letter is written, and if he doesn't eish ALDERSON REPORTING COMPANY. INC, j
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66 4
1 to follow, we'ro prepared to go with an order.
2 COMMISSIONER AHEARNEa Okay.
On page 15 you.; ave
-3 the administrative review of civil penalty and other 4 o'rders.
You have that the reviewing authorities -- and I 5 ~ guess that you are assuming the board and the boards -- at 6 that stage shall independently apply the enforcement 7 policy.
8 Why shouldn't they -- I guess it's more a question 9 to Bill.
Why aren't you proposing that the boards be 10 somewhat bound by the enforcement policy?
11 HR. DIRCKS4 I don't make any proposals regarding 12 the boards.
13 COMMISSIONER AHEARNE4 No, this is -- you're 14 intruding into an area of administrative review and you're 15 essentially saying your proposal is that the boards 18 independently apply the enforcement policy.
17 MR. BICKWIT:
This doesn't say anything about not l
18 being bound by it.
It simply says that they apply it l
19 independently of the application of it by the Direccor.
20 MR. MURRAY:
May I just go on to add, that is
(
21 exactly what was done by the Appeal Board in the Atlantic 22 Research case.
23 COHNISSIONER AHEARNE:
Oh, I know it well.
24 (Laughter.)
25 HR. EURRAY:
And that was the guidance we were ALDERSON REPORTING COMPANY,INC, 400 VIRGINIA AVE., S.W, WASHINGTON. 0.C. 20024 (202) 554 2345
67
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1 taking, since the Commission approved the Appeal Board's 2 action in that regard.
3 COHHISSIONER AHEARNE But I thought this was the 4 ED0's proposed enforcement policy.
- HR. CIRCKS We're asking for Commission 6 endorsement of it.
7 COHHISSIONER AHEARNEs Yes.
But I'm asking 8 whether that ic the approach that you believe ought to te 9 done by the boards.
10 COMMISSIONER GILINSKYs What page are you on now?
- 11 COHHISSIONER AHEARNEs Page 15, section 7.
12~
For example, the boards could review for issues of 13 f act and abuse of discretion.
That would be a possibility.
14 HR. HURRAY:
It was just pointed out to me that 15 there vill be de novo review of these decisions in court, 16 even when the Commission makes them.
And therefore it might 17'be argued the boards ought to have that authority as well.
18 COMMISSIONER AHEARNE:
It migh t be.
It also might 19 be argued that the boards ought not to have tha t authority, 20 de novo authority.
21 HR. DIRCKS:
I don't think they should.
22 COMMISSIONER AHEARNE:
Well, I expected that and I 23 was surprised that this recommended policy didn't have --
24 could you consider that?
25 CHAIRMAN PALLADINO:
You mean sometimes the ALDERSON REPORTING COMPANY,INC.
SCO VIRGINIA AVE., S.W., WASHINGTON, D.C. 20024 (202) 554 2345
68 1 guidance that the Commission gives should not be followed?
2 COHNISSIONER AHEARNE:
No, no, no.
This is the 3 b. card, when the board raviews this.
f.
4 CHAIRHAN PALLADIN0s But I though t this came f rom 5an earlier Commission guidance.
6 COHNISSIONER AHEARNE4 Well, this section was, I 7 believe, a new cc-tion that was added to the enf orcement 8 policy and the guidance f or that was from one experience.
9 But it was not part of the previous 10 FR. HURRAY:
The facts in that case for Atlantic 11 Research, Commissioner Gilinsky, a radiographer had failed 12 to do a lot of things.
He disconnected an interlock and 13 overexposed himself and some others.
The issue was whether 14 management was involved in that, because the management 15 contended they hadn 't given this individual any instructions 16 to def ea t the interlocks.
In fact, they ordered him to do 17 just the opposite.
18 We contended before the Appeal Board and the l
19 Commissicn held, and the Appeal BoarC and the Commission 20 held, that we could impose a civil penalty notwithstanding 21 the lack of direct management involvement.
There was an l
22 aura of management involvement to the extent that they 23 allowed the individual to act as he did, reflecting on the 24 comment tha t you made earlier.
25 But the issue as it fits here is simply, what did ALDERSoN REPORTING COMPANY. INC.
400 VIRGINIA AVE S.W., WASHINGTON, D.C. 20024 (202) 554 2345
69 T'
1 the Appeal Board have to do with our enforcement policy, and 2 they held that they could look at the er#orcement policy on 3 their own and decide what penalty to come to.
They were not 4 ~ sin ~ ply reviewing the Director's decision on the basis of
-5 abuse of discretion.
6 The Commission upheld that and we took that to be 7 the guidance to follow in this case.
8
'.1R. BICKWIT:
But they are still bound to the 9 enforcement policy under that language.
10 COMMISSIONER AHEARNE:
les, I guess I would like 11 to tava it expanded a little bit.
12 MR. BICKWIT:
I understand your point.
I think 131t's a separable ene from whether they are bound to the 14 enf orcement policy.
15 COMMISSIONER AHEARNE:
Remembering very well that 18 whole Atlantic Research thing, I wouldn't mind if they were 17 bound a little more tightly to any enforcement policy the 18 Commission ends up deciding on.
19 COMMISSIONER BRADFORD:
I don't see how yau can 20 bind them without going back to the earlier contention that 21 'this isn 't the regulation.
22 MR. BICKWITs They are bound to the policy to the 23 same extent the staff and the Commission are bound to it.
I 24 don 't see how you can read it any differently than that.
25 COMMISSIONER AHEA RNEs And let me -- Atlantic ALDERSoN REPORTING COMPANY,INC, 400 VIRGINIA AVE., S.W., WASHINGTON. D.C. 20024 (202) 554-2345
70 1 Richfield and the Atlantic Research one still bothers me.
2 MR. BICKWITs I don't blame you, and you can deal 3 with that buestion.
It's just a different question, the 4 extent to which they're bound to this policy.
5 COMMISSIONER GILINSKYa What is it you would like 6 to see happen, John ?
7 COMMISSIONER AHEARNE:
I think the board ought to 8 review f or facts and f or abuse of discretion.
9 COMMISSIONER GILINSKYa So they can say either yes 10 or no, is that the idea?
' 11 COMMISSIONER AHEARNE They can say yes or no on 12 f acts or yes or no on the abuse of discretion.
13 COMMISSIONER GILINSKYa You don't want them to 14 --
15 COMMISSIONER AHEARNEa I don't think they ought to 26be doing a complete review of the whole thing.
17 COMMISSIONER GILINSKYa Are you troobled by their 18 changing the penalty?
19 COMMISSIONZR AHE"RNE:
I'm not sure on that one.
20 COMMISSIONER GIL1*ISKYa I'm just trying to 21 understand.
22 COMMILSIONER AHEARNE I tried to g?' some more 23 tackground on section 7 and I found that there really wasn't 24 tha t much.
It all led hi:2c) to this one case.
And I think 25 the staff has done very well, given that cae data point, to ALDERSON REPORTING COMPANY,INC, 400 VIRGINIA AVE., S.W., WASHINGTON. O.C. 20024 (202) 554-2345
71 1 construct a section.
2 Only one last question and it goes to supplement 6 3 -- or 4, rather, severity categories.
We're talking about
- 4 hea-Ith physics.
And it really doesn't have to do so much 5 with health physics, but let me pick on the footnote.
You 6 have a f ootnote and you have the personnel overexposures and 7 associated violations incurred during a lif esaving effort 8 will be treated separately from the policy.
And I think 9 elsewhere in the policy fou have a sentence alluding to 10 that.
11 I agree with that.
Let me ask a different 12 question.
During an accident, what if the licensee is faced 13 with the issue of violating a regulation in order to take an 14 action that will, in the licensee 's best judgment, alleviate 15 the. accident?
18 MR. STELLO:
We are going to propose -- I don't 17 know the status at the moment -- a change in the regulations 18 tha t would in fact make that clear to the licensee, that it 19 is expec ted that he would do that af terwards.
20 COMMISSIONER AHEARNE:
Okay, because just sitting 21 here on this enforcement policy, it reinforces that 22 MR. STELLO:
We're trying to change th e regulation 23 tha t that would be the Commission 's, in fact, requirement 24 f or that 25 COE5ISSIONER AHEARNEs But you are addressing ALDERSON REPORTING COMPANY,INC, 400 VIRGN'A AVE., S.W., WASHINGTON Q.C. 20024 (202) 554-2345
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1that?
2 NR. STELLO:
Yes.
g-3 CHAlRMAN PALLADINO:
You don't want his medal of 4 honor to be presented in jail.
5 (Laughter.)
-6 COMMISSIONER BRADFORD:
I wasn't taking issue with 7 your comment, Joe.
But it's one thing to state it in an 8 obvious form, which is, if it's essential to prevent th e 9 accident from getting worse, of course we expect him to do to what's necessary.
But you're much more likely to get gray 11 areas floating around, and what you're really going to te 12 deciding af ter the f act is whether the licensee behaved in a 13 reasonable manner even if he wound up in violation of the 14 regulation.
15 And then what's more likely to come into play is 16 some sort of prosecutorial discretion as to what one wants 17 to do about it.
I want to see this action, but I don't 18 think it ought to be couched as a blanket vaiver of the 19 regulation unen things get sticky.
20 HR. STELLO:
There's a regulation for that purpose i
21 and that would be the time to try to make that balance.
22 CHAIRMAN PALLADINO:
I think Victor had a 23 question.
Incidentally, on the way I turned to a page, page 24 4, enclosure 4,
you had enclosure as severity level three 25 and you had it in an Arabic number instead of a Roman ALDERSON REPORTING COMPANY. INC.
m
. " " "?"l^ "M": *^*"'" ' "
2 2"22""2"5
73
(~
1 number.
And it's those sort of things that confuse me and 2 makes me think there 's something I didn ' t catch.
3 COHHISSIONER AHEARNEs One of the commenters 4 sugdesting going from Roman numerals to Arabic numbers, and
.5 our response was we agree.
6 CHAIRMAN PALLADINO:
Well, whatever way you go, 7 don 't change them in midstream.
8 COMMISSIONER BRADFORD:
That's another one of 9 those Commission comments that comes back and winds up being 10 data points.
11 (Laughter.)
12 CHAIRMAN PALLADINO:
I know you didn 't intend to 13 be inconsistent, but 14 COMMISSIONER GILINSKY:
I've just got a brief 15 question, because I get hungry around this time.
But on the 18 Supplement 3 on safeguards, it looked to me like you had 17 some items of rather widely varying importance in severity 18 one.
Let me ask. you first, when you say -- do you have it 19 there? -- an act of radiological sabotage er actual theft, 20 loss or diversion, when you say loss that means what?
Does 21 tha t mean that we have actually concluded that there is a 22 loss or a mismatch on the books or what?
23
,MR. STELLO:
An actual loss.
24 COMMISSIONER AHEARNE:
It's not just an inventory 25 dif ference ?
It's an actual loss?
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1 HR. STELLO:
Right.
2~
COMMISSIONER GILINSKY:
We're convinced there is X 3 kilograms of material floating around somewheres.
4 HR. STELLO:
Yes.
5 COHNISSIONER GILINSKY:
I must say, the actual
~6 theft or diversion as far as I am concerned is a different 7 s t'r at os p her e.
I mean, that's a whole different world.
And 8 if you co.ipare it with another item, which is entry of an 9 unauthorize l individual into a vital area -- would that be 10 somebody who isn 't supposed o be in the reactor control 11 room?
12 MR. STELLO:
He doesn't have authoriration at all 1S to have gotten lato the vital area and he got through all 14 the vital areas, from the barrier outside of the plant.
15 COMMISSIONER GILINSKY I see.
How far would he 16 have to get into the plant to qualify for this?
17-MR. STELLO:
Into a vital area.
18 COMMISSIONER GILINSKY:
And that's what?
i
(
19 NR. KEPPLER:
There are at least two barriers, 20 going through the normal entry of the outside and then 21 get ting past the protective feature.
22 COMMISSIONER GILINSKY:
The turbine area wor') not 23 be such a vital area ?
{
j 24 MR. KEPPLERs It is not.
25 COMMISSIONER GILINSKY:
It is not.
i l
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75 I
1 COMMISSIONER AHEARNE:
Would that include an NRC 2 inspector who was trying to test the system?
3 COMMISSIONER GILINSKY:
Hell, when you say outside 4 the protected area, the protected area is the entire plant.
5 MR. STELLO:
Yeah.
If he didn't use his 6 identification in any way, shape or form. Or was it his 7 recognition to someone unknown or strange, yes.
8 COMMISSIONER BRADFORD:
With regard to severity 9 one, in plants under construction, why do you require that 10 the system be completed?
11 MR. STELLO:
That's the discussion that we had.
12 COMMISSIONER BRADFORD:
I'm sorry.
If you covered 13 i t, plea se forgive me.
I was considering the Commission 14 comments were buted in that supplement 3.
15 MR. STELLO:
Let me conclude by saying we're going 16 to go back and try to deal with seeing if there's some 17 le.nguage that could be used.
18 COMMISSIONER BRADFORD:
Did you also deal with the 19 top of page 6, which seems to make no sense?
This is the 20 sentence on the top of page 6 that I can't make heads or 21 ', al ls o f.
22 COMMISSIONER AHEARNE:
They're picking up your 23 cos;;;..ats.
24 (Laughter.)
25 COMMISSIONER BRADFORD:
Which one?
ALDERSoN REPORTING COMPANY,INC, 400 VIRGINIA AVE S.W., WASHINGTON, D.C. 20024 (202) 554 2345
76 1
COHNISSIONER AHEARNE4 On the top of page 6.
On 2 page 3, section 3, I think they say this was modified to 3 pick up your comment.
~
'4 CONNISSIONER BR ADFORD:
Yeah.
But read that 5 sentence and try to tell me what that actually means.
3 COMMISSIONER AHEARNE:
Oh, that's different.
7 (Laughter.)
8 COMMISSIONER BRADFORD:
I would prefer to have my 9 comments picked up in a way I can understand.
~
10 MR. DIRCKS:
Why don't we just have somebody work 11 on that.
12 COMMISSIONER BRADFORD:
There sust be a number 13 missing.
NRC normally considers civil penalties only f or 14 similar violations that occur blank, from the date, period 15 of time.
16 MR. STELL0s From the date of the last 171ns pection.
18 COMMISSIONER BRADFORD:
You mean af ter the da te of 19 the last inspection?
20 MR. STELL0s Yeah, or within two years, whichever 21 is greater.
22 COMMISSIONER BRADFORD4 Ihe "from" means "after,"
23 or is there a period of time that's missing before the word 24 "f rom"?
25 MR. STELLO:-
It's between the two inspection ALDERSON REPORTING COMPANY,INC,
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77
~
r 1 periods, that compared to two years, whichever is greater.
2 We'll fix it.
3 COHEISSIONER BRADFORD:
Okay.
4 CHAIRMAN PALLADINO:
Now, I gather there are some
-5 changes you 're going to make to this and we 'll be seeing 6 either the revised version or a page that identifies the 7 changes, and we can vote on that when we receive it.
8.
MR. BICKWITs Mr. Chairman, our office has a 9 number of comments with respect to that.
10 MR. STELL0s You're going to provide them to us, I 11 hope.
12.
MR. BICKWITs That's what I meant by saying that.
13 CHAIHHAN PALLADINO:
Okay.
Thank you all for 14 coming.
We stand adjourned.
15 (Whereupon, at 12:30 p.m.,
the Commission was 16 adjourned. )
17 18 19 20 21 22 23 24 25 ALDERSON REPORTING COMPANY,INC, 400 VIRCINlA AVE., S.W., WASHINGTON, D.C. 20024 (202) 554-2345 1
e NUCLEAR REGULATO E COMMISSICN This is to certify that the attached preceedings befcre the
}
COMMISSION MEETING
(
- 4...
..w.e a w e.
w.r..
DISCUSSION OF NRC ENFORCEMENT POLICY a
Date-cf Proceeding:
October 28, 1981 Decket Nu=ber:
Place of ?receeding:
Washington, D. C.
aert held as herein appears, and tha
- his is the criginal transcript thereof fer-the file of :he Cec =issice.,
4 A <n pilev Official ?ieperta-C~/;ed)
-Wil,)
Official Reporter (3ignature)
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y
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e