ML20039C016

Supports Rejection of Governor Brown 811217 Suggestions Calling for Halt to Audit & Adoption of Util Proposal. Alleged Possible Improprieties Between Util & Consultants W/O Merit

ML20039C016
Person / Time
Site:	Diablo Canyon, 05000233
Issue date:	12/22/1981
From:	Furbush M PACIFIC GAS & ELECTRIC CO.
To:	Palladino N NRC COMMISSION (OCM)
References
NUDOCS 8112280317
Download: ML20039C016 (3)

Text

_ _ _ _ - - _ _ _ _ _ _ _ - _

es g

7  :,

e

..NEIEO

';6Tr PACIFIC GAS AND ELECTRIC C O M PANY P. O. BO A 74 4 2

• 77 BE ALE STREET,3lST FLOO AN C A, RNI A 9410 6 TE LE PHON E (415) 7 81-4 211 T L COprrd1 51 543-7813 MALCOLM H.FURSUSH r-; C ~0% ,

0C m.7j.iG &;NIIA3J 2

u..o. wc es.oa=r -

- Sf R -lC

... u ...~ cou.u ,

r December 22, 1981 L ANC.9 o Mr. Nunzio J. Palladino, Jr. j 'dD 7 gE.C Chairman f .

Nuclear Regulatory Commission S g IOO/ A., F-

k. Q. 4e Washington, D. C. 20555 ,

"+plpp 7

S *

Dear Chairman Palladino:

N'e- P Governor Brown's letter of December 17, 1981, for a halt to the ongoing audit of Diablo Canyon, rejection of PGandE's proposal for an extensive audit by three eminent expert bodies, and the establishment of a set of " ground rules" comes as no surprise. It is a part of the Governor's longstanding game plan to prevent, if possible, and delay as long as possible, in any event, the operation of Diablo Canyon.

The reasons given for his stance are "possible improprieties between PGandE and its consultants" and the adverse effect this might have on the "public's perception" of the objectivity and credibility of the auditors' work.

These " reasons" are without merit and we hope that the Commission will have the courage to say so in the face of the political pres-sure imposed by the Governor and his allies.

This so-called "public perception" is one which the Governor is doing his utmost to create. Your Commission can correct this

" perception," if it exists, by a forthright ruling that recognizes how audits are conducted and that the Company and Dr. Robert L.

Cloud have followed accepted practices. The charge of " impropriety" stems from the fact that at the technical working level of PGandE preliminary drafts of a proposed report by Dr. Cloud were reviewed for factual accuracy.

The practice followed is not only the widely accepted procedure for independent audits, but also, as you may know, conforms to the

" Standards For Audits of Governmental Organizations, Programs, Activities and Functions" of the Comptroller General of the United States, a copy of which, in appropriate reference,is attached.

Similarly, it is consistent with the internal auditing procedure of the NRC itself. The following statement is contained in a report to Congress by the Comptroller General, dated July 9, 1981, t)Sc)3

.c 8112280317 811222 PDR ADOCK 05000275 G PDR Ih

n ,

w- ,

f' . -

Mr. Nunzio J. Palladino, Jr.

Page Two December-22, 1981-relating to the NRC Office of Inspector and Auditor (This office was created in 1975 to independently review and appraise all NRC operations, and recommend corrective actions) :

"Before an OIA report is issued, it is normally, forwarded to the affected HRC program office for review and comment. This, in our view, is a legitimate process for ensuring that draft reports are factually correct and based on sound and logical analysis.- More importantly, it offers responsible program officials the opportunity to either agree or disagree with the findings, conclusions, and recommendations of the draft report and to. identify corrective actions, if any, they plan to take."

Not only was the procedure followed proper, but also the following offer was made to the Commission on November 3, 1981, on behalf of the Company (page 217 of the record) :

"The report ~itself hasn't been prepared. If you want a copy of it before we get it, fine, or simultaneously. It is an independent consultant, and, you know, I don't know how~we.can show you that more than to give you the reports when they are prepared. You.

certainly are welcome to have an auditor, if you will, from the NRC accompany Dr. Cloud and his people in their work. Whatever you want to do. If you want to talk to

'them directly out of our.-presence, fine. He is an independent consultant."

It is time that resp'ected consultants and men of science be spared the chiracter assassination that has been allowed to creep into this proceeding and that the Commission-take the lead in affording them protection.

We urge rejection of the Governor's suggestion and expiditious:

, adoption of the auditing proposal we have submitted.

Very truly yours, ht n $/ *

(

MHF:lmg cc: Commissioner John F. Ahearne Commissioner Peter A. Bradford Commissioner Victor-Gilinsky Commissioner Thomas M. Roberts

- Service List-

' Attachment H

V Stanc arcs For Aucit I sews of Responss.ble Offics.a ls '

Of Governmental

, , , , c . . I , , . .. . . . . .~ , r m..r , , v . . w , s , . . . .. . . . ,.. , , . . ,. . . , , s fa , , . ,. ... .,,... ... a n. ,

olijersive is in obtain ailsance revir= an.1 rom.neni by ollirial of ihr amhini O{8QQ{g(}QQg> entity. This pnulurcs a report which slmas not onis *has wa-Inun.1 an.1 alue the aua....,, thmt aheo . i.ni ai,e wimi ihe ,r-i..nsaar i-r en- ihint asms .: ami whai they plan to lo al.out it.

Programs,

, . . A lvance comments slumhl 1.c objersisely csatuaini, anil the report

""m ' '" - "d < " < ' " -' " 'd -" - " "' - " " ' - d -

Activities 3

• analys.* of ihrm simuhlI.c fairly presenini m the text of ihr report. A promisc of rurrersive artion simuhl 1 c nonni hun simul.I nos he arrepini as justifiration for AnC. FdunCliOns amerinx a sixnirirani reini or a reiaica nrommendaiim..

When ihr comments oppo c :he auditors' findings or ronclusions ami are not, llY Tile in iheir opinion, vali l. ihe amlitors simuhl state shrir reasons for rejerring them.

COMPTROLLER Conversely, they shoubt modify shrir position if ihry find the comments valid.

GENERAL OF TliE Recognition of Noteworthy Accomplishments UNITED STATES Significant management arromplishments iilentifini during ihr audit should i e inchaled in the audit report, along wiih defirienries. Surb information is

[to sr,4 necessary to fairly present the situation the amlitors fin.1 anil to provide g appropriate balance to the report. In aiblition, inrinsion of such arromplishments 1 3 ,p, .pgI may lea.I to improved performance 1.) other government organizatio es that read o the report,

'b'ecouM issues Needing Further Study iI the scoge of the audie or uther fariors limits In an litors' abilis,s to impiire into certain matters they I.clics c hould 1.c simlini. the auditors shoubl inrlmic in .

the report such matters an.1 she reasons why they twlics, they merie furiher sa mly.

Prin ileged and Confidential Information Crrsain operating infornution may bc i rotubient from general disclo ure by Fnieral, State , or local law- or regulations. Surb informainm may be provi.lal on a nenl to tnow basis only to gwr ons authoriini ley law or regulation to rrreisc it.

11 the amlitors are prohibient by such rnguirements from inrlmling lmriinent

. lata in'ihr report, they shouhl state she nature of ihr information ominent (f. r l'El Rev. .isu o

- . . - -  :;.s

-__ ___ -