ML20054A299
| ML20054A299 | |
| Person / Time | |
|---|---|
| Site: | South Texas, Comanche Peak, 05000000 |
| Issue date: | 04/13/1982 |
| From: | Atomic Safety and Licensing Board Panel |
| To: | |
| References | |
| ISSUANCES-A, NUDOCS 8204150358 | |
| Download: ML20054A299 (59) | |
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NCCI. EAR REGULATORY COMMISSICN D
ATOMIC SAFETY AND LICENSING BOARD l
In te.u-~=~ ct:
HOUSTON LIGHTING AND POWER COMPANY, DOCKET NOS.
SOUTH TEXAS UNITS 1 AND 2
___________________1 TEXAS UTILITIES GENERATING COMPANY, DOCKET NOS.
COMANCHE PEAK UNITS 1 AND 2 DATE:
April 13, 1982 PAGES: 1267 thru 1324 AT:
Bethesda, Maryland 9,
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1 UNITED STATES OF AMERICA 2
BEFORE THE ATOMIC SAFETY AND LICENSING BOARD 3- - ---- ----
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4 In the Matter of 5 HOUSTON LIGHTING AND POWER COMPANY, a Docket Number 50-498A and 499A 6 Et A1.,
SOUTH TEXAS UNITS 1 AND 2 7----
--x 8 In the Matter of 9 TEX AS UTILITIES GENERATING COMP ANY, a Docket Number a
50-445A and 446A 10 E t A1.,
COMANCHE PEAK UNITS 1 AND 2 a
11 - - - ---------------x 12 NRC Hearing Room Fifth Floor 13 4350 East-West Highway
{}
Bethesda, Maryland 20014 Tuesday, April 13, 1982 15 The Conference of Counsel was convened.at 16 10:00 a.m.,
pursuant to notice.
17 BEFORE:
18 JAMES A.
LAURENSON, Administra tive Law Judge 19 APPEARANCES:
20 J.
A.
BOUKNIGHT, JR., Esq.
l 21 DOUGLAS G. GREEN, Esq.
Lowenstein, Newman, Reis C Axelrod 22 1025 Connecticut Avenue, N.W.,
Suite 1214 Washington, D.C.
20036 23 On behalf of Houston Lighting and Power Company
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24 25 O
ALDERSON REPORTING COMPANY,INC, 400 VIRGINTA AVE., S W., WASHINGTON, D.C. 20024 (202) 554-2345
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1 APPEARANCES (Continued)
J. GREGORY COPELAND, Esq.
2 J.
MICHAEL BALDWIN, Esq.
Baker C Botts 3
3000 One Shell Plaza O
Houston, Texas 4
On behalf of Houston Light and Power Company 5
M. D. SAMPELS, Esq.
Worshan, Forsythe & Sampels 6
2500 Bryant Tower Dallas, Texas 75201 7
On behalf of Texas Utilities 8
JOSEPH B.
KNOTTS, Esq.
Debevoise & Liberman 9
1200 17th Street, N.W.
Washington, D.C.
10 On behalf of Texas Utilities 11 GEORGE SPIEGEL, Esq.
Spiegel C McDermott 12 2600 Virginia Avenue, N.W.
Washington, D.C.
13 On behalf of Public Utilities Board
{)
of Brownsville, Texas NANCY MC MILLEN, Esq.
15 DAVID AMTHONY DOPSOVIC, Esq.
Antitrust Division 16 U.S.
Department of Justice Washington, D.C.
17 DAVID M.
STAHL, Esq.
18 Isham, Lincoln & Besle One First National Plaza 19 Chicago, Illinois 60603 On behalf of Central Southwest Corporation 20 DOUGLAS F. JOHN, Esq.
21 McDermott, Will & Emery 1850 K Street, N.W.
22 Washington, D.C.
20006 On behalf of South Texas Electric Cooperative 23 and Medina Electric Cooperative
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24 STEPHEN LEWIS, Esq.
ANN HODGDON, Esq.
23 Co-counsel for the NRC Staff O
ALDERSON REPORTING COMPANY,INC, 400 VIRGINI A AVE. S.W., WASHINGTON, D.C. 20024 (202) 554-2345
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> aoceror"os 2
JUDGE LAURENSON:
Let the record show that the 3 conference of counsel is now in session.
4 I will first take this opportunity to 5 introduce myself to you.
I am James A.
Laurenson, 6 administrative law judge.
I have been an administrative 7 law judge for the past six years, most recently with the 8 Federal Nine Safety and Health Review Commission.
I 9 have been assigned in place of the Atomic Safety and to Licensing Board, previously assigned to this matter.
I 11 do not claim I can do as good a job or a better job.
12 But I do work more cheaply than the three of them.
13 I issued an order on March 22 inviting the C.
14 parties to submit a brief statement concerning the 15 pertinen t history, identification of the issues 16 remaining in the cases, and their suggestions as to what 17 should be done.
18 All of the parties except for the City of 19 B rownsvilla Public Utility Board complied with that 20 request.
I appreciate the responses.
They have been 21 helpf ul to me.
22 I have prepared an agenda for today's 23 con ference, which I will go th ro ugh briefly with you now
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24 to hit the high points so you will know the direction 25 you are going in.
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1 MR. SPIEGEL:
I sm havino trouble hearino 2 you.
3 JUDGE LAURENSON:
I said I will review the 4 agenda I have prepared for today 's meeting to give you 5 an idea of where we are going with today's conference 8 and the issues that will be discussed here.
At the 7 conclusion of the discussions of these items, I will 8 hear anything else any of the parties want to raise.
9 The first item of business after we have the 10 appearances entered in the record will'be to hear from 11 the City of Brownsville attorney concerning their motion 12 f or continuance.
There has also been a suggestion made 13 by several parties that these two proceedings should be 14 Severed or that the consolidation should be vacated.
15 Then I want to get into discussions of the 16 specific settlement proposals in the two cases.
And 17 then I have some specific questions I want to address to 18 the attorneys for the City of Brownsville, the 19 Department of Justice, and the Staff of the NRC.
20 Then I want to discuss the question of whether 21 or not a full evidentiary hearing will be necessary and, 22 if so, under what conditions and on which issues.
Then 23 we can discuss whether or under what terms the schedule
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24 f or tha t h e a ring should be set.
Those are the items I 25 have identified for today's conference.
As I said, I am O
ALDERSON REPORTING COMPANY,INC, 400 VIRGINI A AVE., S.W., WASHINGTON. D.C. 20024 (202) 554 2345
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1 willing to hear anything else, and I will go throw the 2 floor open at the end of this conference to any views 3 any party wants to raise.
4 At this point I would like to begin by asking 5 the attorneys to enter their appearances for the 6 record.
We will sove from my left to my right.
7 Will you please begin?
8 MR. LEWIS:
Your Honor, my name is Stephen 9 Lewis, counsel for the NRC Staff.
My co-counsel is Ann 10 Hodgdon.
11 MR. JOHN:
I am Douglas John of the law firm 12 McDermott, Will E Emery, 1850 K Street, Suite 500, 13 Washington, D.C. 20006.
I am here on behalf of South 14 Texas Electric Co-operative and Medina Electric 15 Co-opera tive.
16 MR. SPIEGEL:
My name is George S piegel, from 17 the firm of Spiegel and McDermott, 2600 Virginia Avenue, 18 Northwest, Washington, D.C.
And I am here on behalf of 19 the Public Utilities Board of the City of Brownsville, 20 Texas.
21 MS. MC MILLEN:
Your Honor, my name is Nancy 22 McMillen.
I represent the Department of Justice.
And 23 my co-counsel is Mr. David Dopsovic.
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24 MR. KNOTTS:
My name is Joe Knotts.
I 25 represent Texas Utilities Generating Company.
With me O
ALDERSON REPORTING COMPANY,INC.
400 VIRGINIA AVE., S.W., WASHINGTON, D.C. 20024 (202) 554-2345
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1 at the table is M.
D. Sampels, also representing Texas 2 Utilities.
3 MR. STAHLs Good morning, Your Honor.
My name 4 is David Stahl.
I am with the law firm of Isham, 5 Lincoln and Beale in Chicago, appearing this morning cn 6 behalf of Central and Southwest Corporation and its 7 subsidiaries.
8 MR. BOUKNIGHT:
Your Honor, I am J.A.
9 Bouknigh t, Jr., apppearing on behalf of Houston Lighting 10 and Power Company.
I am v'ith the law firm of 11 Low enstein, Newman, Reis and Axelrod.
Douglas Green, of 12 the same firm, is here with me, as are J. Gregory 13 Copeland and J. Michael Baldwin of Baker C Botts in O
14 Houston.
15 JUDGE LAURENSON:
Am I correct then that there 16 is no one here representing TEX-LA Electric Coopera tive 17 of Texas, and no one representing the State of Texas?
18 (No response.)
19 JUDGE LAURENSON:
Mr. Bouknight, are you 20 representing San Antonio and Austin as well, or not?
21 MR. BOUK NIGHT :
No, Your Honor.
22 JUDGE LAURENSON:
Then San Antonio and Austin 23 are not represented today either?
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24 MR. BOUKNIGHT That is correct.
25 JUDGE LAURENSON:
All right.
At this time, O
ALDERSON REPORTING COMPANY,INC, 400 VIRGINIA AVE., S.W., WASHINGTON, D.C. 20024 (202) 554-2345
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1 Mr. Spiegel, I will haar you concerning your motion for 2a 20-day extension.
3 MR. SPIZGEL:
Your Honor, the motion states r-)
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4 with great precision what it is we want, which is a 5 20-day extension during which period there will be a 6 meeting of the Board of Trustees, I believe they are 7 called -- a t least it is the governing board of the 8 Public Utilities Board of Brownsville, Texas -- at which 9 time they will take up the matter of what position to 10 take in this proceeding.
And that is the sum and 11 substance of it.
12 It is a public agency.
It does operate with a 13 certain amount of formality.
There is a meeting O
14 scheduled f or the 19th.
And this matter will be 15 definitively determined by that time.
It just seems 16 tha t in a matter of this importance the 20-day extension 17 o f time is desirable and I do not believe should 18 seriously burden the other parties.
We do want to 19 coopera te, and this is the best way in which we can 20 cooperate in this proceeding.
21 JUDGE LAURENSON:
Do I understand you to say, 22 Mr. Spiegel, that this is the first time the Public 23 Utilities Board has considered this proposed
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24 settlement?
25 MR. SPIEGEL:
No, I would not say that.
The
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ALDERSON REPORTING COMPANY,INC.
400 VIRGINlA AVE., S.W., WASHINGTON, D.C. 20024 (202) 554 2345
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1 last time this case was active was in 1980, as I 2 recall.
Since 1980 nothing has happened really until 3 your order was issued.
It would have been a neater 4 recourse if th e position had been fully developed.
But 5 there have been certain discussions.
And it does seem 6 to me that the practical matter is that it is before the 7 Board and will be resolved.
8 As I say, it is a case of great magnitude, and 9 they are a pparently in th e position of a system that has 10 not accepted the settlement.
Subsequent to the last 11 meeting we had with the Trial Board, their predecessors, 12 we had a settlement with Central and Southwest.
That 13 occurred in Febuary of 1981.
O 14 And thereaf ter, on March 18, 1981, Brownsville 15 filed a supplemental status report which modified its 16 decision and which had previously been set out in 17 comments.
I do not have the full name of the document, 18 but it is comments which were filed November 12, 1980.
19 Tha t settlement was with Central and Southwest.
It 20 speaks for itself.
And we simply modified our position 21 so as to restrict certain positions we take in view of
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22 the agreement that has been reached.
i 23 That settlement, in turn, has a public
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24 document at the Faderal Energy Regulatory Commission.
l l
25 It is filed as a rate schedule which has been accepted i
ALDERSON REPORTING COMPANY. INC.
400 VIRGINIA AVE., S.W., WASHINGTON, D C. 20024 (202) 554-2345
1275 1 for filing.
I could give you the docket number on that 2 in a moment.
3 Ihereafter we modified our position at the 4 Regulatory Commission to accommodate that settlement.
I 5 have never had any objection to filing a copy of the 6 settlement with the NRC.
And if the parties desire, I 7 have copies of that settlement with me.
8 MR. STAHLs Excuse me, Your Honor.
I hate to 9 interrupt, but I have just been handed a message, the 10 sionificance of which I do not quite understand.
It may 11 have some bearing on this proceeding.
I have been asked 12 by someone from our Washington office to ask for a brief 13 recess while I make a telephone call.
As I say, it may 14 have something to do with this proceeding, and it may 15 n o t.
With your permission, though, I would like to 16 return this call.
I think it should only take five 17 minutes at the maximum.
It is marked " Urgent.
Ask for 18 recess."
I am just following orders.
19 (Laughter.)
20 MR. SPIEGELS It is signed " Ronald"?
21 JUDGE LAURENSON:
All right.
Do you want us 22 to wait until you come back?
Is that what you are 23 sayino?
Do you want us to go forwstd with a discussion O
24 of 8townsw111e s motion wh11e vou ere coner 25 MR. STAHL:
I would prefer to be here, since ALDERSON REPORTING COMPANY,INC.
400 VIRGINIA AVE., S.W., WASHINGTON, D.C. 20024 (202) 554-2345
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1 we were the people who settled with Brownsville.
And if 2 Your Honor would prefer to continue with this, I can 3 leave af terwards.
I really apologize for disrupting
{;
4 Your Honor's agenda.
I am not quite sure, as I said, 5 whether this has anything to do with this proceeding or 6 not.
I find it a strange request to'ask for a recess if 7 it has nothing to do with this proceeding, frankly.
8 JUDGE LAURENSON:
You have got our attention.
9 (Laughter.)
10 Under these most unusual circumstances, we 11 will give you five minutes.
12 MR. STAHL:
Thank you.
I appreciate it, Your 13 Hon or.
O
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14 (Brief recess.)
15 MR. STAHL:
Your Honor, thank you very much.
16 In fact, the communication does apparently 17 ha ve some thing to do both with Brownsv111e's position in 18 this proceeding and th e position we may take in response 19 to Brownsville's position.
I do not have the precise 20 communication in my possession now, but I understand it 21 is being sent over here and, hopefully, I will have it 22 bef ore the hearino recesses today.
23 JUDGE LAURENSON:
Mr. Spiegel, have you 24 completed your discussion of your motion?
25 MR. SPIEGEL:
I was going to say that the O
ALDERSON REPORTING COMPANY,INC, 400 VIRGINTA AVE., S.W., WASHINGTON, D.C. 20024 (202) 554-2345
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1 settlerent agreement, which consists of a number cf 2 documents, is filed in te Central Power and Light 3 Company FERC Docket Number ER-81-662.
It has been 4 accepted for filing.
And as I understand it, the total 5 agreement has been filed.
The agreement consists of a 6 letter agreement, a transmission services agreement, and 7 attached to the transmission services agreement, the 8 Texas Interconnected System tansmission policy 9 quidelines a re also a pa rt of that filing.
10 I have extra copies of the settlement 11 agreement with me if any of the parties would like a 12 copy.
It is a public document and has been for some 13 tim e.
O 14 I think that is all I need to say, Your 15 Honor.
16 JUDGE LAURENSON:
Does anyone else want to be 17 heard on the motion of the City of Brownsville Public 18 Utilities Board?
19 MR. STAHL:
Well, Your Honor, I would like to 20 be heard briefly on this.
And that is to speak in 21 opposition to the motion for a continuance.
The motion 22 sta tes that this is a matter of extraordinary importance 23 to Brownsville.
n(_)
24 Mr. Spiegel points out he has had the 25 settlement license conditions in his possession and ALDERSON REPORTING COMPANY, INC, 400 VIRGINIA AVE., S.W., WASHINGTON. D.C. 20024 (202) 554-2345
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1 presumably in his client's possession since September 2 1980.
And it seems to me if this were such a matter of 3 extraordinary importance to Brownsville, they would have 4 discussed the simple matter at one of their earlier 5 meetings whether or not they would oppose the settlemen t 6 license conditions.
7 I think that is particularly true after the 8 settlement Central and Southwest reached wi th 9 Brownsville, under which agreement Brownsville severely 10 restricted its rights in this proceeding.
11 There are only two very na rrow issues on which 12 Brownsville reserved the right to litigate in this 13 proceeding.
And it just seems to me that in the year 14 since that settlement agreement, the Public Utilities 15 Board could have taken some action at least to explore 16 in a preliminary way whther they still had any 17 opposition to these license conditions in light of their 18 settlement agreement.
19 And I would just suggest that in fact the 20 motion does not set forth any justification for a 21 continuance and should be denied.
22 MR. BOUKNIGHT:
Your Honor, Houston also 23 opposes the motion.
"c Ht. Stahl pointed out, Mr.
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24 Spiegel and the Public Utilities Board have had these 25 conditions in hand for a very long time.
They have ALDERSON REPORTING COMPANY,INC, 400 VIRGINIA AVE., S.W., WASHINGTON D.C. 20024 (202) 554-2345
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I known during that antire time since at least the winter 2 of 1980 that only th ey stand between a complete 3 settlement of this proceeding.
And it would seem as 4 though during that period, with two major events 5 occurring -- first, the settlement between Brownsville 6 and Central and Southwest; and second, Brownsville's 7 agreement to a settlement of the interconnection issue 8 with the FERC -- that Brownsville would have given some 9 thought to this.
10 The other point that I would make is you 11 issued your order on March 22 and directed tha t papers 12 be filed on April 6.
If there were simply a problem of 13 scheduling a meeting sometime in late March or early
{T 14 April, I would have thought we would have heard'about 15 tha t shortly after the March 22 filing.
16 The procedure of letting the filing date pass, 17 letting all of the other parties file their papers, and 18 three days later requesting an extension of time does 19 not seem to me to be appropriate.
20 I would think if this is an important 21 proceeding to Brownsville, particularly in light of 22 their place in this proceeding as the only non-settling 23 pa r ty, that it is time for them'to speak up and say what
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24 is on their mind.
I f rankly do not understand how Mr.
25 Spiegel can find himself in the position he says he is O
ALDERSON REPORTING COMPANY,INC.
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1 in today.
2 JUDGE LAURENSON:
Anyone else?
3 MR. LEWIS:
Yes.
Judge Laurenson, the Staff 4 also opposes the motion of Brownsville.
The motion does 5 not reveal any reason why Brownsville was not able to at 6 a minimum do what Mr. Bouknight has suggested; namely, 7 if their Public Utilities Board was unable to meet 8 within the time set forth by the Board, to promptly 9 notify Your Honor and to explain on a timely basis that 10 a certain extension of time was needed.
There is 11 nothing in the motion which addresses that matter.
12 Additionally, I would agree that Brownsville, 13 although it states that it finds itself in a situation 14 of the only non-settling party, it has been in that 15 situation since September 1980.
And one would presume 16 that a mere request for the status of its position in 17 this proceeding would not entail a great difficulty for 18 it.
19 MS. MC MILLEN Your Honor, the Depa rtment of 20 Justice also opposes this motion.
There is not much I 21 can add to what has already been said.
But it seems to 22 u s it would not have been a particularly difficult 23 matter for Brownsville to have taken the matter still a t
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24 issue from its November 12, 1980, meeting a nd simply 25 summarize those remaining for you.
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1 MR. JOHNS Your Honor, South Texas and Medina 2 have no objection to the Brownsville motion.
I would 3 like to say one word perhaps in Brownsville's behalf.
J 4 Whatever the reason for Brownsville 's Board 's f ailure to 5 come up with a position between the two weeks we have 6had between Your Honor's notice and this meeting, the 7 f act remains that Mr. Spiegel does not appear to have 8 authority to speak for the Board of a definitive 9 position.
10 That being the case, I am not sure what 11 purpose would be served in requiring Brownsville to be 12 here today.
None of the parties I have heard speak so 13 f ar have given a reason why it would be personally 14 damaged or handicapped by the grant of a 20-day 15 extension.
They seem to be drawing exclusively upon the 16 f act that Brownsville should have had time to organize 17 its thought and come up with a definitive statement 18 toda y.
19 Again, we do not oppose the motion.
We have t
20 no objection to it.
But I do believe, in order for this 21 proceeding to be drawn down to a productive conclusion, 22 it may be a mistake for Your Honor to require a 23 statemen t to be msde when Mr. Spiegel at this point does
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24 not have authority to speak for the Board on this 25 point.
O ALDERSON REPORTING COMPANY,INC, 400 VIRGINIA AVE., S.W., WASHINGTON, D.C. 20024 (202) 554-2345
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I will let him speak to that for himself.
But 2 my feelino is it is certainly comething to be taken into 3 considera tion.
4 JUDGE LAURENSON:
Is there anything else?
5 MR. SPIEGEL:
I would sa y th rough out this and 6 in diff erent proceedings there have been all kinds of 7 accommodations made for all types of attorneys and all 8 classes of parties, not only here but at the FERC and at 9 the SEC.
10 It is all well and good to take a n 11 oversimplified view that we knew in 1980 everything or 12 in February 1981 everything we would be faced with a t 13 this particular soment.
It was not that clear.
The 14 matters wen t before the FERC.
The FERC entered 15 orders.
Some of the parties here objected to certain 16 aspects of those orders.
That was clarified.
The FEBC 17 was clarified.
Over at the SEC there was a lot of 18 mum bling and bumbling going on over there.
And finally, 19 the SEC order was issued.
j 20 So I do not think if one were to read the 1
21 record in this case and see the number of times we as 22 attorneys have accommodated each other, I would not see 23 anything extraordinary.
O 24 sure, I cennot diseeree with e sim 11fied 25 vie w.
You issued an order.
Obviously, I should have O
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1 answered it on April 6.
I happen to be a very 2 responsible attorney.
I have been practicing before the 3 NRC and its predecessor f rom the initial cases.
4 I was the attorney in the Statesville case in 5 the Court of Appeals.
And in fact, in that proceedino I 6 represented the Massachusetts Municipal Group.
While 7 that proceeding was going on in the Court of Appeals, we 8 had the first antitrust proceeding before the NRC.
9 JUDGE LAURENSON:
I do not think it is 10 necessary to review your entire history.
11
.1R. SPIEGEL:
Yes.
I do not come here 12 lightly, and I know what it is to pass a da te.
And I 13 think what I am saying here is that I find myself in a 14 position where we need definitive authority from the 15 Public Utilities Boa rd, Your Honor.
16 I do not think it extraordinary for an 17 attorney to ask for this time.
And I wish my friends on 18 the other side voald remember the many times I have i
19 accommodated them and they have accommodated me and give 20 us the extra 20 days.
I cannot see that an y grea t 21 injury will be done, although I do appreciate, and I do 22 apologize f or, the inconvenience here.
23 JUDGE LAURENSON:
Before ruling on this
(')
24 motion, I do want to make one commen t specifically to 25 M r. Spiegel but to everyone in general also.
And that
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[
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1 is that the motion filed by Brownsville con tains with it 2 a certificate of service showing it was mailed on April
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36, which according to my records is erroneous.
I 4 received a copy of it postmarked April 9.
I think 5 errors like this that occur cause problems.
The 6 attorneys know what is contained in a certificate is 7 called a certificate.
You have certified that the 8 service has been made.
9 These should be done accurately.
It will 10 cause problems in computing time for responses and in 11 determining whether things are tim el y.
I will expect 12 from now on that we will not have problems concerning 13 the correctness of certificates of service.
14 MR. SPIEGELS I apologize for that.
It 15 certainly was served on the 9th.
And a pparently someone 16 picked up the service list we had prepared on the 6th 17 and did not use on the 6th.
And I can only apologize a 18 second time.
I am sorry about that.
19 JUDGE LAURENSON:
As far as the motion is 20 concerned, I have considered the representa tions made by 21 Brcwnsville through its counsel.
The motion is denied.
22 Do you have anything in writing to submit at 23 this time, Mr. Spiegel?
24 MR. SPIEGEL:
I do not have anything to submit 25 in writino at this time.
As I said, I am prepared to O
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1 provide copies of the settlement agreement.
2 JUDGE LAURENSON:
But in terms of a response 3 to my order of March 22, you have nothing to submit in
[}
4 writino; is that correct?
5 HR. SPIEGEL:
Tha t is correct, sir.
I will be 6 prepared to submit it after the 19th when the Board 7 meets.
8 JUDGE LAURENSON:
All righ t.
The next item on 9 the agenda that I listed previously was a suggestion by 10 several of the parties here tha t I consider a motion to 11 sever these two proceedings or to vacate the prior 12 con solidation.
13 Does anyone wish to be heard concerning such a (4 motion or the preocedures f or accomplishing this?
15 MR. KNOTTS4 Judge, we have very briefly 16 add ressed tha t subject in a paper we filed on April 6.
17 I would add to tha t only that it seems to me the 18 standards governing vacating an order of consolidation 19 or severance would be the inverse of the standards 20 governing consolidation in the first place.
And I 21 believe those standards are met in this instance.
22 If there is any doubt about the status of the 23 South Texas proceeding, in light of the most recent
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24 developments, that doubt does not apply to the Comanche 25 Peak proceeding wherein all parties have settled.
And O
ALDERSON REPORTING COMPANY,INC, 400 VIRGINIA AVE., S.W., WASHINGTON D C. 20024 (202) 554 2345
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' it o=1a de ia the poetic 1atere t-co#=1 teat ita tee 2 Commission 's regulations encouraging se ttle men t, to 3 proceed to terminate the HP proceeding.
4 JUDGE LAURENSONs Let me put it this way.
Is 5 there any party here who is opposed to the severance of 6 the two proceedings?
7 (ifo response.)
8 JUDGE LAURENSON:
Mr. Spiegel.
9 MR. SPIEGEL:
I would simply state, and the 10 comment can run through the rest of the proceeding, that 11 I do not feel that I have authority to take a position 12 one way or another on these issues being discussed now.
13 This would be, of course, without waiver of the rights O
14 o f Brownsville.
15 Also, we, of course, cannot wa ive the right to 16 take exception of Your Honor's denying our motion.
So I 17 will basically remain silent.
But it represents neither 18 acquiescence nor opposition.
We reserve our rights.
19 JUDGE LAURENSON:
Does anyone else have 20 anything else to add?
21 (No response.)
22 JUDGE LAURENSON:
I suggest the way to proceed 23 on this would be to file a motion, a joint motion or O
24hewe er you want to work it out emong yourse1.e,
25 concerning this.
And then there will be time allowed O
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1 under our rules f or the response if anyone wishes to 2 oppose it.
When the time expires, I will consider all 3 of the responses and rule upon the motion a t that time.
4 MR. KNOTTS:
Very well, Your Honor.
5 JUDGE LAURENSON:
The next thing I want to 6 identify is the specific provisions of the settlement 7 agreements.
As I understand, at the last conference of 8 counsel on this proceeding there were some apparent 9 discrepancies between the two settlements, and there 10 were some form conditions which were filed on September 11 24 of 1980.
12 Am I correct that those conformed conditions 13 are the ones presently before me as a proposed O
14 settlement?
Or have there been other changes?
15 MR. LEWIS:
There have been no other changes 16 tha t I am aware of, Your Honor.
I believe it is 17 correct.
I do not have the date in front of me, but 18 there were a set of conformed conditions submitted to 19 you which contained various corrections, mostly of an 20 editorial nature, from the previous version.
And that 21 is what is before you.
22 JUDGE LAURENSON:
Does anything else have 23 any thing to the contrary on that?
24 (No response.)
25 JUDGE LAURENSON:
Turning then to the proposed O
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1 settlement in the Comanche Peak case, the representation 2 has been ande that none of the parties to that action
[}
3 oppose that settlement, tha t in f act all parties are in 4 sgreement with the settlement.
Is that a correct 5 statement?
6 MR. KNOTTS:
Judge, I am sorry, I did not hear 7 the first part of what you said.
8 JUDGE LAURENSON:
In talking about Comanche 9 Peak 10 MR. KNOTTS4 Yes, sir.
11 JUDGE LAURENSON:
-- I said the representation 12 has been made that all parties to the Comanche Peak 13 proceeding are in agreement that the settlement, or at O
14 least that none oppose the settlemen t.
Is that a 15 correct statement?
16 MR. KNOTTS:
I believe it is.
17 JUDGE LAURENS3N:
The parties I have 18 identified as being in the Comanche Peak proceeding 19 a re :
Texas Utilities Generating Company and the 20 Intervenors being Central and Southwest Corporation and 21 TEX-LA Electric Cooperative of Texas.
And the State of 22 Texas is an interested State, I believe, in that 23 proceeding.
(
24 MR. KNOTTS:
Yes, Your Honor.
And the State 25 of Texas has taken no active part, so far as I know, in O
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1 these proceedings since the initial prehearinc 2 conf erence.
(~S 3
JUDGE LAURENSONs Turning to the South Texas V
4 Project case, the position of the Brownsville Public 5 Utilities Board in the past has been in opposition.
Is 6 that correct, Mr. Spiegel?
7 MR. SPIEGEL:
Well, there was a general 8 opposition to the project, subject to the promulgation 9 of conditions which would be satisfactory to Brownsville 10 and other parties in the public interest.
That has been 11 the position.
So the only argument has not been whether 12 the project should be built or not, but what conditions 13 should a pply.
14 JUDGE LAUR ENSON:
We are talking about the 15 conformed conditions filed and ordered by the Board on 16 December 24, 1980.
And the basic question here is does 17 Brownsville presently oppose approval of those 18 conditions?
l 19 MR. SPIEGEL:
I am in the difficult position 20 of asking for time so I could speak authoritatively for 21 Brownsville on this point.
And you have denied that 22 motion, and I find myself not able to respond to that 23 particular question.
That is why I really do feel --
()
24 and I am not one for rearguing rulings -- that more 25 progress would be made if I could be given the time to O
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1 speak au thoritatively rather than having the proceeding 2 close in this somewhat difficult position I am in, and I 3 have obviously placed Your Honor and the other parties 4 in.
I do not relish it, but that is the situation.
5 JUDGE LAURENSON:
Before this proceedino is 6 over today, you will have an opportunity to submit 7 formal responses on behalf of your client.
I would 8 suggest at the present time, since you do not have the 9 authority to speak for them on the questions at hand, 10 tha t you consider the specific questions that' I am going 11 to ask for response by Brownsville.
12 HR. SPIEGEL:
Yes, that would be a good 13 procedure.
O 14 JUDGE LAURENSON:
I want to know whether 15 Brownsville presently opposes approval of a settlement 16 in the South Texas project.
17 MR. SPIEGEL 4 Possibly opposes approval?
What 16 was the word af ter " approval"?
19 JUDGE LAURENSONs Of the proposed settlement.
20 HR. SPIEGEL:
Thank you.
21 JUDGE LAURENSON:
Secondly, does Brownsville 22 Public Utilities Board want me to reject this 23 settlement?
Third, how do the conditions in this
()
24 settlement agreement affirmatively harm or prejudice 25 Brownsville ?
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r' 1291 (f
1 And fourth, do the conditions in th e 2 settlement agreement themselves create or maintain a
)
,\\sttuationinconsistent 3
with the an titrust laws?
' 4 And now I would like to turn to the Departmen t 5 ef) Justice and raise some questions I have concerning 6 the ' settlement in both matters, but particularly in the 7 soe'th Texas project cases.
First of all, it appears 8'from some of the prior filings in these cases that the 9 Decartment at one point represented tha t as f ar as the
~
10 DC interconnections were concerned, they were 11 anticompetitive in the FERC proceeding and t
12 procompetitive in this proceeding.
/,
13 I don't understand, and perhaps you can b ' ?
'J 14 explain to me, the Depa rtment's position.
15 MS..?.cMILLENs A lot of people have had 16 t rouble wit h tha t position, Your Honor.
Basically what l
17 it, boils down to is we have always believed that DC i
18 interconnections were better than no interconnections, 3
19 but that AC interconnections might possibly be even 20 better than DC interconnections.
21 That was the basic posit ; n _t'oth here and a t 22 FERC.
And we believe we have "
ol 3d our difficulties 23 with a comparison between AC :.nd ut.tn te rconnections in
()
24 the settlement we reached in the FERC proceeding, which 25 has been approved by the Commission.
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Did the Department v
2 characterize that interconnection as anticompetitive?
3 MS. McMILLEN:
I can recollect only sa ying O("N 4 that in comparison AC was more competitive, more 5 procompetitive than DC interconnections.
We have always 6 taken the position tha t DC interconnections were better 7 than none.
8 JUDGE LAURENSON:
I am not sure that answers 9 the question I raised, which is whethe r the De pa rtm en t 10 had contended that the DC interconnection was 11 anticompetitive.
12 MS. McMILLEN:
I don't believe we have ever 13 said th a t.
What we have said is, it is less 14 procompetitive than AC interconnections.
15 JUDGE LAURENSON.
I think one of the standards 16 I have to consider in approving or rejecting a 17 settlemen t is a comparison of the settlement with the 18 initial letter f rom the Attorney General's office 19 concerning the commencement of these proceedings.
In 20 this case it is the letter of John Shenenfield, where he 21 recommended that an antitrust hearing be held on the 22 operating license aspect of the case.
23 And as I understand it, he set forth two
)
24 reasons for that advice, and I want to address this 25 question to the Jusr. ice Department, to ask them to ALDERSoN REPORTING COMPANY,INC.
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1 explain to us, or to me, how the proposed settlement 2 answers or responds to these reasons set forth by "r.
3 Shenenfield.
He said:
first, an antitrust hearing 4 should be held here to determine whether, in order to 5 remedy a situation inconsistent with the antitrust laws, 6 Houston Light & Power should be precluded from adhering 7 to the intrastate only sgreement; and secondly, from 8 unreasonably refusing to engage in interstate 9 connections.
10 MR '. B3UX NIGHT :
Your Honor, may I be he'ard out 11 of turn on the question of the standards before the 12 Board?
13 JUDGE LAURENSON.
Sure.
O 14 MR. BOUKNIGHT:
It is Houston's position, and 15 I believe also tha t of the Depa rtmen t and staff in 16 pleadings they have filed here, that the question before 17 Your Honor is, are the settlement license conditions 18 consist ent with the public interest, not do they remedy 19 any alleged situation in this case.
I believe that the 20 NRC precedents, some of which we tried to summarize in 21 our paper we filed on April 6th, indicate that's the
(
22 only question that need be reached.
So long as no one 23is prejudiced by approval of a settlement among less
)
24 than all the parties to a case, then it is not necessary i
j 25 or even appropriate to consider whether those conditions O
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ou1a re= ear e situetioa vaioh he= aot ret heea orovea 2 or found to be the case.
3 Now, perhaps the Dep a r tm en t or the staff 4 should speak f or themselves on tha t.
5 MS. McMILLENs Your Honor, I happen to agree 6 with Mr. Bouknight.
We set forth that s ta nda rd in our 7 latest response to you.
The Catawba case seems to 8 indicate that even in the case where not all parties 9 have settled, the standard used by the Board is one of 10 whether or not the settlement is a reasonable settlement 11 of differences among the settling parties within the 12 public interest, snd with regard to any non-settling 13 parties whether or not that party is harmed, improperly 14 prejudiced or disadvantaged.
15 I do believe tha t is the standard which has 16 been enunciated by FRC decisions.
17 JUDGE LAURENSON:
Doesn't the public interest 18 require some consideration of the Attorney General's 19 previous advice to the Nuclear Regulatory Commission?
20 MS. McMILLEN.
Whether it necessarily requires 21 it, it seems to me that the focus should not be on 22 whether or not the situation is necessarily completely 23 remedied, because after all the re has been no hearing O
24 thet such a situetion even exiets based on evieence.
25 That proposed settlement a ttempt to take ca re of ALDERSoN REPORTING COMPANY,INC, 400 VIRGINIA AVE., S.W., WASHINGTON, D.C. 20024 (202) 554-2345
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1 situations that have been contained in the Attorney 2 General's advice letter is appropriate, and in fact we 3 have done so here, I really believe.
4 But still, the standard is, is it a reasonable 5 settlement, is it in the public interest.
6 JUDGE LAURENSON:
Well, my review of the 7 previous decisions o f the Safety and Licensing Boards 8 concerning these settlements does not show me any one 9 clea rcut method of dealing with this.
It has been to handled in differant fashions by different boards.
11 I'm sure those of you who are familiar with 12 this have seen the way it was handled in the Waterford 13 matter, where various things were assumed arguendo and 14 the board came up with its own proposed conditions 15 without the benefi t of a f ull eviden tiary hearing.
I am 16 not suagesting that is the way to proceed with this, but 17 tha t was one method by which a settlement was reviewed 18 by a boa r:1.
19 But I don't think that it would be in the 20 public interest to fail to consider the method by which 21 this proceeding was initiated or at least what led to 22 the publication in the Fede ral Register of the Attorney 23 General's advice letter.
So the question I'm really
()
24 askino is, wha t is the position of the Department, 25 whether it has changed its view concerning th e Attorney O
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1 General's advice or whether it want to comment as to 2 whether th e se proposed conditions meet the situation 3 dercribed in that letter?
4 MS. McMILLEN:
Well, Your Honor, we do feel 5 that the settlement conditions address the problem 6 con'tained in the adiice letter.
The problem basically 7 pointed out in the advice letter was wha t you have 8 noted, we call an intrastate only agreement.
And I 9 believe the le tter goes on to indicate that we perceived 10 that, the intrastate only agreement, to be a sort of 11 group boycott situation.
12 The settlement license conditions specifically 13 con tained a provision which in the South Texas license 14 conditions is 6(b).
15 (Pause.)
16 Could I have one moment, Your Honor, to confer 17 with my co-counsel?
He has raised an issue I hadn't 18 thought of.
~
19 JUDGE LAURENSON:
In fairness, let me raise a 20few of the questions I intend to ask of the Department 21 o f Justice, and you may want to confer on these 22 quastions also.
23 As I understand your response to my March 22nd (n_)
24 o rd e r, the Department is saying that the settlement 25 conditions should be had immediately and if necessary O
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1 there would be a plena ry hearing on Brownsville and the 2 remaining issues.
If that were to take place and 3 Brownsville prevailed on any of its remaining antitrust 4 issues -- again, we are just assuming all o f this --
5 would that then require some later amendments to the 6 conditions that we are now attaching to the operating 7 license?
And if so, how would tha t be done?
8 What I am saying is, is it a good idea to 9 attach any kind of conditions at this point, knowing of 10 course there is no operating license right now anyway?
11 I also wanted to know what the Department's position 12 would be insofar as this case was concerned if a 13 settlement was approved.
That is, would the Department 14 continue to be involved or would it seek to withdraw 15 f rom this proceeding ?
18 Before we take this little recess, let me ask 17 some questions of the NRC staff which I think will come 18 up and they might want to discuss as well, so that we 19 will be prepared on this.
One is the same question I 20 asked the Department of Justice concerning the 21 attachment of conditions that may have to be changed at 22 a later time in the event Brownsville or some other 23 party prevailed af ter a f ull evidentiary hearing.
()
24 Secondly, there is a suggestion made in the 25 staff 's response that the conditions should be attached O
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1 to the construction permit.
I would like to know the 2 authority for that condition.
3 And then I will ask if the other parties have 4 any comments concerning that proposal.
5 So with that in mind, we will tak e about a 6 five-minute recess.
7 (Recess.)
8 JUDGE LAURENSON:
We are back on the record 9 now.
10 MS. McMILLEN:
If I could summarize one of the 11 points that have come up over the recess, Your Honor, I 12 think I would like to start by indicating that, as I 13 stated earlier, the advice letter of course is not O
14 evidence.
It was our best estimate of what was 15 happening, and based upon our best estimate of what was 16 happening ' we recommended a hearin g to find out what was 17 happening.
18 And no one in this proceeding in none of the 19 stipulations that have been signed is conceding that in 20 f act anything alleged in the advice letter really i
j 21 occurred.
There were some stipulations filed by all of 22 the parties, in which, in point of fact, the Applicants 23 specifically denied having done anything.
l ()
24 Well, do you have the conditions, Your Honor?
25 Perhaps I could read this into the record if you do.
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1 JUDGE LAURENSON:
I do have.
2 MS. McMILLEN4 There are two paragraphs in the 3 South Texas conditions, for example, that it might be 4 important to look at in the South Texas stipulation, 5 excuse me.
Paragraph number 2 of that stipulation 6 indicates that the party and the NRC staff are of the 7 opinion, which they will communicate to the Board, that 8 the licensing of the South Texas project under these 9 conditions will not create or maintain a situation 10 inconsistent with the antitrust laws or policies 11 thereunder, in accordance with the standards set forth 12 in Section 105 of the Atomic Energy Act, and will 13 withdraw their request that the NRC conduct a hearing 14 pursuant to that section.
15 MR. SPIEGEL:
We are having trouble finding 16 t ha t.
Could you give us the page number?
17 MS. McMILLEN I'm reading from the 18 stipula tion filed on the original se ttlemen t conditions 19 in September 1980.
20 MR SPIEGELa Could you perhaps give us a 21 minute to find it?
I'm sorry, I withdraw my request.
22 MS. McMILLEN:
So that what the parties have 23 stipulated here is that with these conditions licensing
()
24 o f the plant will create no situation inconsistent wi th 25 the antitrust laws, nor maintain one.
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1 And furthermore, in paragraph four of the 2 stipulation it is stated that each of the Applicants 3 denies that its past conduct and/or its proposed 4 activities under the license for the South Texas project 5 without these conditions are inconsistent with'the 6 antitrust laws in any respect, and nothing in these 7 stipulations or conditions constitutes any admission or 8 evidence of inconsistency with or violation of any law 9 or regulation, state or federal.
10 So we don't have a Waterford situation here.
11 You cannot assume arguendo.
Specifically in the 12 stipulations that is stated not to be.
It is a 13 settlement in the clearest sense of the word, and no
(
14 admission of any f acts or evidence can be derived f rom 15 the fact that we have settled this case.
16 JUDGE LAURENSONa Well, in addition to the 17 public interest provision that has been cited, I think 18 everyone is apparently in agreement that the rules of 19 the Commission require that settlements be fair and 20 reasonable, whatever those terms mean.
But I still 21 think that one must consider the settlement in light of 22 wha t has gone on in this matter, and I think that the 23 Attorney General's position is entitled to substantial O
24weioht.
25 I think in terms of determining whether a
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1 settlement is fair, reasonable and in the public 2 interest, it may be necessary to understand how the 3 settlem ?nt will af fect the conditions described by the 4 Attorney General which were used to trigger this 5 proceeding.
That is what I am trying to get at.
8 MS. McMILLEN:
Well, then I think the best 7 thing to do is to show you those provisions of the 8 program conditions which we believe took care of our 9 problems.
10 MR. BOUKNIGHT Before we start down that 11 road, may I interject just a word?
What is concerning 12 all of us, I think, Your Honor, is that we are in a case 13 here that is analogous to a personal injury action where 14 there is a question as to whether someone ran a red 15 lig ht.
We have agreed not to resolve that question.
We 16 have agreed not to resolve what happened in this case.
17 And when we then start line by line into a 18 negotia ted settlement, which was negotiated with each 19 party considering his litigation in this case, then I am 20 afr tid we jump into an area from whence there can be no 21 return.
I am very concerned that once we again assume 22 unproven facts are true and we Juestion whe ther this 23 settlement is remedial, then ut that point we have to
(
24 discuss whether the f acts are true and our whole 25 framework falls apart, because we have agreed not to I
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1 determine whether these facts were true.
2 MR. LEWISs Your Honor -- I am sorry.
3 JUDGE LAURENSON:
Yes?
4 MR. LEWIS:
The staff would like to be heard 5 on this.
I sympathize with Your Honor in trying to 6 determine what the substance of the public interest test 7 is that you must apply to accept in this case what 8 appears to be presen tly an uncontested settlement.
The 9 initial cases on this subject simply state the test is 10 two-pronged:
One, Whether the adoption of the 11 settlement license conditions is in the public interest; 12 a nd number two, whether the non-settling party would be 13 prejudiced by their approval and attachment.
()
14 I believe Judge Block was attempting to come 15 to grips with this same issue in the St. Lucie 16 proceeding, and it is the case which I believe goes the 17 f urthest in staking out a responsibility of a licensing 18 board or judge to look into the licensing conditions.
19 And what he did in the case, which we have cited on page 2011 of our statement, which is an April 24th, 1981, 21 memorandum and order, was to define his job as inquiring 22 into whether implementation of the conditions will on 23 their f ace create or maintain a situation inconsistent
)
24 with the antitrust laws or policies.
25 Without taking a position as to whether or not O
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1 that formula tion of th e test, which is the most 2 f ar-reaching in our case law, is correct, that test f
3 would appear to involve an inquiry which falls
(>
4 considerably short of having to go back and look at the 5 initial positions of the various parties in this case of 6 the Department of Justice in their advice letter to the 7 Commission and trying to match them up one for one with 8 the provisions of the settlement.
9 I believe that in the St. Lucie case -- and I 10 think it would be a ppropria te here a s well -- the judge 11 was particularly influenced, in trying to determine 12 whether or not the conditions on their face will create 13 or maintain a situation inconsistent with the antitrust O
14 laws or policies, by the positions expressed to him by 15 the parties, both settling and non-settling, and was to 16 some extent being influenced and relying upon the 17 positions stated by those parties as of the time the 18 settlement was before him.
19 So I think that even under that formulation 20 you would not have to retrace the initial positions of 21 each of the parties and determine the basis for the 22 conclusions reachad by each of the settling parties that 23 the issuance of the operating licenses for South Texas
()
24 with the settlemen t license conditions attached will not 25 create or maintain a situation inconsistent with the A
l
\\-)
1 i
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1 antitrust laws.
2 JUDGE LAURENSON:
Let me clarify one thing.
I 3 am not requesting a line by line analysis of this 4 proposal.
I don't think there would be any benefit to 5 that.
But what I am trying to find out, which I have 6not seen in the record up to this point, is some general 7 description of the position of the Department overall as 8 to the application of the settlement.
9 What I am requesting is a rela tion of the 10 settlement back to the Attorney General's advice letter 11 to the Commission.
I don't think it is necessary to 12 trace the initial positions of all parties, but I think 13 the advice of the Attorney General does have a special 14 place in any antitrust proceeding before the 15 Com mission.
16 MR. KNOTTS:
Judge, may I inquire if you are 17 in ef f ect asking, does the stipulation withdraw the j
18 advice letter in effect?
19 JUDGE LAURENSON:
That is one question I raise 20 to Justice, whether the Attorney General had changed the 21 advice given or whether the conditions in the settlement 22 were consistent with that or how they affected the l
23 advice previously given.
()
24 MR. KNOTTS:
Changed, modified or withdrawn.
25 JUDGE LAURENSONs Right.
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1 MS. McMILLEN.
Well, Your Honor, I think that 2 paragraph two of the stipulation I read you indicates 3 tha t we have agreed that the licensing of the project 4 under these conditions will not create or maintain a S situation inconsistent with the antitrust laws.
6 JUDGE LAURENSON:
I understand the 7 conclusion.
I as trying to find out, in light of the 8 specific events that have apparently transpired here to 9 set this thing in motion, how the conclusion squares to with those events.
I can see, for instance, that there 11 is a provision here that the parties have agreed that 12 they will not maintain any agreements in contravention 13 o f the antitrust laws.
O 14 The only thing that I think is missing is some 15 general presentation by the settling parties setting 16 forth their belief how this proposed settlement is in 17 the public interest and is fair and reasonable.
I 18 understand the conclusion is agreed to by all parties, 19 but I don't think anyone has set forth the reasoning 20 behind that, nor attempted to show it.
21 I understand the problems Mr. Bouknigh t has 22 raised with regard to a settlement.
You don't want to 23 h a ve to go back and justify every single word or
()
24 sentence in the sattlement, because that is the nature 25 of a compromise.
On the other hand, I think if I am ALDERSON REPORTING COMPANY,INC, 400 VIRGINIA AVE., S.W., WASHINGTON, D.C. 20C24 (202) 554 2345
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1 r eq uired to look a t a proposed settlemen t and not just 2 rubber stamp it, but in fact to consider items such as 3 fairness, reasonableness and public interest, this 4 imposes upon me an obligation beyond that of merely 5 rubber-stamping approval.
6 I think these are just some questions that 7 should be answered on the public record.
There should 8 be some such 'information available f or any party to 9 review should'they want to look at the record.
And the 10 responses have been in the past just to respond to 11 particular objections by the City of Brownsville.
And I 12 understand what those have been.
13 But I don 't know that there is any overall AV 14 presentation that has been made to show the items have 15 been considered in the light of the applicable 16 sta ndard s.
Maybe I missed something.
17 MR. LEWIS:
If I may, Your Honor, the staff 18 did attempt
- to do preci0ely tha t, and in our December 19 3 rd, 1980, comments on the license conditions and motion 20 f or their a pproval, from pages 8 through 38 we did 21 undertake an analysis of the settlement conditions 22 broken down into broad categories and an explanation of 23 t he nature of each of the conditions and statements as
(
24 to why we thought they removed any situation 25 inconsistent that may have existed and were O
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1 procompetitive in their effect on Texas entities.
2 So I would draw your attention to that 3 pleading, and that certainly was our purpose there.
4 JUDGE LAURENSON:
Does the Department 5 subscribe to that or does it have an independent 6 submission on that point?
7 MS. McHILLENs We did not make a specific 8 filing quite like the staf f 's.
We did make a filing on 9 December the 3rd, but it did not address specific 10 license conditions other than the conditions related to 11 disconnections.
But our statement as to those 12 provisions, our position as to those provisions in the 13 licensing conditions is in our December 3rd filing.
O 14 JUDGE LAURENSONs Is it fair to say that your 15 position is that the Department has filed sufficient 16 material to support this settlement, then, and that 17 nothing else is needed?
18 MS. McMILLEN:
I would think so, Your Honor.
19
-TUDGE LAURENSON s What about the other 20 questions that were raised?
If this is approved, does 21 th e Department intend to withdraw from the proceeding?
22 MS. McMILLENs Well, I can 't really say that 23 we have made up our mind firmly.
But I believe it would
()
24 be our intention to withdra w and to be available only if 25 you should wish us to be.
Still, I cannot say that O
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1 firmly.
I would have to check.
2 JUDGE LAURENSON:
And the matter concerning 3 the immediate implemen tation of these conditions, as 4 opposed to holding them in abeyance, I suppose.
What is 5 your position?
6 MS. McMILLEN:
We would like them to be 7 immediately approved.
I believe the staff has taken a
~
8 position as to the timing of the attachment, which Mr.
9 Lewis might address, and we would subscribe to.
10 MR. LEWIS 4 Are you giving me carte blanche?
11 Are you?
12 MS. McMILLENs If you tell me wha t you have 13 told me before, I will subscribe.
O 14 MR. LEWIS
- Shall I proceed, Your Honor?
15 JUDGE LAURENSON:
Does the Department have 16 a nything further to add concerning the questions I 17 raised before?
18 MS. McMILLENs Those were the only questions I 19 had written down, Your Honor.
20 JUDGE LAURENSON:
Mr. Lewis?
21 MR. LEWIS Your Honor, the first question you 22 posed was whether or not, if the conditions were to 23 attach immedia tely and there was subsequently to be what
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24 you described as a plenary hearing, whether as a result 25 o f that hearing the license conditions could O
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1 subsequently be modified.
The answer to that is yes, 2 they could, and that is what was done in the Waterford 3 proceeding, although that was certainly a proceeding 4 which used its own procedural system, the use of the S assumption arguendo.
6 Nevertheless, what did happen there is, after 7 that hearing on the motion for the summary disposition 8 the board did recommend the adoption of an alternative 9 set of license conditions which contained certain 10 modifications which it believed were necessary and 11 provided that the applicant could either acquiesce in 12 those modified conditions, in which case the board would 13 recommend to the Commission that there was no need for a O
14 hea ring, or could contest them, in which case th e y would 15 go to a plenary hearing.
16 And that was the situation where this 17 happened, af ter the licensing board had approved on an 18 immediate basis the settlement license conditions 19 entered into by all except the non-settling intervenor.
20 And subsequently, af ter tha t hearing, they did come out 21 with modifications.
So there is precedent for doing 22 that and we certainly would concede that any approval by 23 Your Honor of the conditions for the South Texas
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24 licenses would be without prejudice to their 25 modification if there were any further proceeding at O
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1 Brownsv111e's request.
2 I would note also tha t the effect of Your 3 Honor's approval of the license conditions would be to 4 require all of the parties who entered into that 5 settlement to agree that, at a minimum, they will abide 6 by those conditions, irrespective of subsequent 7 litigation at Brownsv111e's request.
8 On the question of attachment to the 9 construction permits, the question of whether or not 10 this Board has jurisdiction to direct the Director of 11 Nuclear Reactor Regulation to attach the settlement 12 conditions to construction permits is the subject of 13 some doubt, and the parties are in disagreement on O
14 tha t.
In any event, we will modif y the position we took 15 in our statement to you and simply request that, should 16 you approve the se ttlement conditions, that you direct 17 their a ttachment to the operating licenses for South 18 Texas and Comanche Peak.
19 We do believe that the Director of N uclea r 20 Reactor Regulation does not work under the same 21 limitations of his jurisdiction that this Board may, and 22we intend to vigorously explore whether or not the 23 Director might not also have the authority, in order to
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24 achieve immediate effectiveness of those conditions, to 25 attach thes by amendment to the construction permits.
(
ALDERSON REPORTING COMPANY,INC, 400 VIRGINtA AVE., S.W., WASHINGTON, D.C. 20024(202) 554 2345
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1 But we think it is best, in light of the doubt about the 2 Board's jurisdiction, to leave that matter for the 3 Director.
4 JUDGE LAURENSON:
Do any other parties have 5 anything to add concerning the area we have just gone 6 through concerning the specific questions I have asked 7 to three of the parties here?
8 MR. BOUKNIGHT:
Just one brief comment, Your 9 Honor.
The value of approving the settlement conditions 10 now is twofold:
First, it ends litigation between the 11 A pplicants, the Department and the staff; and secondly, 12 it changes the situation that will exist under the 13 license.
There is certainty that certain conditions 14 will be in eff ect, certain limitationc will be placed
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15 upon the sctivities of the Applicants, and theref ore you 16 are looking at a much narrower situation than if you had 17 no license conditions.
18 I think the difference translates in this case 19 what would have been a hearing that would have lasted 20 not less then a year into a hearing which, if it is 21 necessary to have one, can be completed in a few weeks.
22 JUDGE LAURENSONs I am happy to h ear that.
23 (Laughter.)
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24 JUDGE LAURENSON:
Is there anything else?
25 (No response.)
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1 JUDGE LAURENSON s All rich t.
The next issue I 2 have, the next item on my agenda, is the question of the 3 determination of whether a f ull evidentiary or plenary 4 hea ring is needed.
There doesn't seem to be any 5 particular agreemen t on this and I guess to a great 6 extent it depends upon what Mr. Spiegel's client decides 7 to do in the next week or so a t their meeting.
8 The suggestion was made by Mr. Bouknight that 9 a requirement be issued to Brownsville in the event they 10 vish to proceed with their independent contentions that 11 they should in fact file such contentions under the Rule 12 2.714 (b ), in order to specifically identify the 13 contentions tha t a re still in existence af ter the 14 various settlements that have taken place.
Does anyone 15 vish to be heard concerning tha t, either the necessity 16 f or a f ull hea ring or the proposal?
Mr. Bouknight?
17 MR. BOUKNIGHT:
Your Honor, I would make two 18 points.
The first is that we believe, in light of the 19 set tlement here and the settlement of the FERC, to which 20 Brownsville was a party, that it is highly unlikely that 21 Brownsville can frame any issue that would be suitable 22 for hearing in this case.
This case was about the 23 interconnection question.
Brownsville settled the
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24 interconnection question in the forum that has primary 25 responsibility over that.
n
%J ALDERSON REPoRilNG COMPANY,INC, 400 VIRGINIA AVE., S.W., WASHINGTON. D.C. 20024 (202) 554 2345
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1 I think the suggestion made in the joint 2 pleading of Central and South ' Jest, San Antonio, Austin 3 and Houston was made at a time when we were not aware of 4 what Mr. Spiegel's position would be or of how the 5 proceeding would go from April 6th.
I think it is now 6 clear that what will happen after this conference is 7 tha t Your Honor will require Brownsv111e's written 8 responses.
We vill have a round of pleadings on the 9 questions of these license conditions.
10 Therefore, I would suggest that our proposal 11 and our pleading be amended and that, if Brownsville 12 af ter the first round of pleadings and af ter Your 13 Honor's ruling on the subject desires to go forward with O'
14 the hea ring, then instead of merely filing contentions 15 Brownsvilla should be required to file a t tha t time a 16 trial brief setting forth their issues and setting forth 17 why they think they can prevail as a matter of law on 18 those and summarizing the evidence they think supports 19 their position, and then if we can, move from there.
20 Because it is apparent to me that when we 21 f ramed our original proposal we felt that Brownsville 22 today would have said yea or nay as to whether they 23 opposed these matters, that very quickly we would be
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24 moving ahead with identif ying contentions and disposing 25 of them.
It is clear that will not happen.
So I don't ALDERSON REPORTING COMPANY,INC, 400 VIRGINIA AVE., S.W WASHINGTON D.C. 20024 (202) 554 2345
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I think we need another round of pleadinos in the form of 2 contentions.
Two rounds ough*. to be enough, the round 3 on the settlement and then the round of trial briefs, if 4 Brownsville persists in its objections.
5 JUDGE LAURENSON:
Does anyone else wish to be 6 heard on this matter?
7 MR. LEWIS:
Yes, Your Honor.
The staff had 8 made a somewhat similar suggestion in its statement that 9 Brownsville, if it should indicate to the Board that it 10 did want to have a further proceeding, be required to 11 satisfy the Waterford standards, namely th a t it set 12 forth with specificity what remaining situa tion 13 inconsistent with the antitrust laws or policies it O
14 perceived, and to set forth a meaningful nexus between 15 the activities under this South Texas license and the 16 situa tion alleged to be inconsistent with the antitrust 17 laws.
18 This could in our mind also be pa rt of either 19 a trial brief or a statement of contentions, as the l
20 Boa rd may wish to impose the requirement.
But we also 21 were f raming our comments at tha t time on the assumption 22 tha t Brownsville would also be advising the Board j
23 simultaneously of its position, and we do believe it is
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24 appropriate, in light of Brownsville's failure to do 25 tha t, to first and foremost require Brownsville to state j
O 4
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1 definitively whether it intends to proceed at all or 2 not.
3 JUDGE LAURENSON:
Mr. Spiegel, do you wish to 4 be heard on this?
5 MR. SPIEGEL:
Well, I think as ma tters are 6 developing here if these questions you ask are to be 7 presented to the board, and certainly if Brownsville is 8 to take a position, then there should be a procedure.
9 Eventually, we shall have to come back and state with 10 precision exactly what our contentions are and what our 11 procedural proposals are.
12 I have the questions Your Honor has stated, 13 which I will immediately get off to the board and ask O
14 them to answer specifically at the next board meeting.
15 JUDGE LAURENSON:
The questions I raised go 16 only to the settlement conditions.
They do not go 17 bef ond that in terms of, if Brownsville decides it wants 18 to continue to litigate this ma tter, what specific 19 issues it wants to litigate.
Maybe that is what we are 20 talking about right now.
21 NB. SPIEGEL:
Yes.
If there are more 22 questions to be framed in the light of that development, 23 I would be pleased to pass them back to the boar'd.
As a l
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24 practical ma tter, I would be advising you anyway on 25 those matters.
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1 JUDGE LAURENSON:
Mr. Spiegel, how much time 2 do you believe you need to respond on behalf of your gs 3 client to the four questions I raised with you before?
O 4
MR. SPIEGEL:
I believe what I would like is 5 to have it presented to the board at their meeting of 6 the 19th, and then it is just a matter of a few days to 7 get back to you with their answers.
8 Secondly, if the answer requires a statement 9 of position that should take no great time, because the 10 position is laid out by reading the two documents I have 11 referred to, the comments of November 1980 as modified 12 by our statement of March of
'81.
Now it is just a 13 matter of sort of integrating those two documents, and 14 that would be 'the position we have at that time.
15 Now, preparing a trial b ri ef, I don't know how 16 much time Mr. Bouknight is offering me to prepare a 17 trial brief.
I could say this to Your Honora If it 18 comes to trial briefs, I will take any time you give me, 19 provided they will take the same amount of time.
I l
20 don 't want to come in and be given a week or two to 21 prepare a trial brief, and then find the attorneys for 22 the other side calling me up saying, George, we have 23 always worked together, can you give us a couple of
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24 months to prepare our trial briefs.
25 I would say to Mr. Bouknight:
State your O
ALDERSoN REPORTING COMPANY,INC, 400 VIRGINIA AVE., S.W., WASHINGTON, D.C. 20024 (202) 554-2345
1317 1 time, and I will match it as you must, too.
2 JUDGE LAURENSON:
Insofar as the four 3 questions I raised today wi th you, would it be fair to 4 say you could have a response to that filed within two 5 weeks of today?
6 MR. SPIEGELS It's the 19th, which is -- I'm 7 sorry.
Give me a moment here.
8 (Pause.)
9 I ask in my motion to have until Tuesday, May 10 4 t h, figuring the meeting would be -- well, let's go 11 back here.
The meeting will be on April 19.
I believe 12 that is a Thursday or a Friday.
I don't have a 13 calendar.
O 14 MR. BOUKNIGHT:
It is next Monday.
15 MR. JOHNa It is Monday of next week, six days 16 awa y.
17 MR. SPIEGEL 4 In any event, I would like to 18 have four or five days after the 19th.
19 JUDGE LAURENSONs Two weeks from today, then.
20 14 days from today will be the 27th.
21 MR. SPIEGELS I think when I prepared this 22 motion I looked at the calendar and jumped an extra 23 week, or asybe I was just trying to allow myself a 24 lit tle extra leeway.
But I would think that two weeks 25 f rom today would be the 27th.
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1 Vow, as I say, if the other parties would 2 a 2ree they would have no more than two weeks to prepare 3 their trial brief, I could have a trial brief by that rs U
4 date.
Maybe I am being too jocular and maybe I should 5 withdraw tha t commen t.
6 The answer is, Your Honor, I will provide an 7 answer to the questions by the date you gave me.
8 JUDGE LAURENSONs I will prepare an order 9 requiring Brownsville's response to the questions I 10 raised be filed on the 27 th of A 'p ril.
Thereafter I will 11 leave an additional ten days for any party to respond to 12 tha t.
Upon the expira tion of that time, I will rule 13 upon the motions concerning the settlement.
O 14 I an assuming somewhere in this period'of time 15 the parties will get together their joint motion or 16 individual motion to sever these proceedinos, so that in 17 the event it may be a problem they can be dealt with 18 individually.
19 HR. KNOTT:
Judge, in that regard, we are 20 continuing to assume that Brownsville is not a party to 21 Comanche Peak, which has been the fact since the 22 beginning of the proceedings.
23 JUDGE LAURENSON:
My records do not show 24 Brownsville as a party to the Comanche Peak proceeding.
25 MR. SPIEGEL:
Well, whatever our position is O
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1 or was, I am not changing it at this point.
2 (Laughter.)
J But,- Your Honor, I think it really may not 4 make any significant difference, because the questions 5 raised, since there is a joint settlement, if there are 6 issued raised with the South Texas project, whatever the 7 technicality may be on separation, I would think the 8 substantive impact -- well, in any event, I should 9 simply say, whatever our position on that subject is, it
~
10 is at this moment and I won't comment on it one way or 11 the other.
12 MR. KNOTTs Judge, the reason I brought up the 13 subject is that I did not wish our silence to be ta ken
}
14 as assent as to anything af fectino the Comanche Peak 15 proceeding.
And even though we are intervenors in the 16 South Texas proceeding, it has been our posture to be 17 def erential toward the other parties, but we don't want 18 to be taken as explicitly agreeing with all of the 19 procedures discussed in South Texas.
4 20 JUDGE LAURENSON:
All right.
Are there any 21 other matters any party wants to raise at this time?
22 (No response.)
23 JUDGE LAURENSON:
All right.
To briefly
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24 review the bidding, then, the parties will file a motion 25 to sever or to vacate the consolidation of the two
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1 proceedings.
The Brownsville Public Utility Board will 2 be ordered to submit the specific answers to the 3 questions I raised here within 14 days from today.
All
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4 parties will be given a ten-day period of time within 5 which to respond to that.
6 A t the conclusion of this time, based upon the 7 inf ormation then in the record, I will rule on the 8 actions that are pending at that time.
And if there is 9 any reason to speculate further as to what may happen 10 af ter that, we will have to wait and see what 11 Brownsville 's response is and what ruling is made.
12 So with that --
13 MR. BOUKNIGHT:
Your Honor, when you asked a O
14 moment ago if there were other matters, there is one and 15 I was tardy in rising.
Just to give some forewarning of 16what will come if we head toward an evidentiary hearino, 17 there remains discovery of Brownsville, which was not 18 completed in earlier phases of the proceeding.
Certain 19 depositions were delayed at the request of Brownsville.
20 And I have a further understanding that the 21 management of the Brownsville system has changed since 22 the time the depositions were taken.
So between Mr.
23 Spiegel's filing of a trial brief or whatever other
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24 piece of paper he is required to file setting forth what 25 he wants to litigate and our responsive pleadings, there O
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1 would be depositions we would request.
2 JUDGE LAURENSON:
What type of time f rame a re 3' you talking about?
4 MR. SPIEGEL:
If I may be heard, Your Honor.
5 The Board, your predecessor, ruled that there would be 6 no more depositions, no more discovery, and cut it off 7 for all parties.
8 MR. BOUKNIGHT:
I cannot agree with that.
9 MR. SPIEGEL:
The question only is, and what 10 Houston Ligh t C Power's counsel is saying is, that he 11 reserves the right to reopen discovery if that is what 12 happens down the road.
But as of this moment, there is 13 an understan, ding of the Board that all discovery is 14 stopped.
15 MR. BOUKNIGHT4 Two things.
First, I think 16 the time period, to answer your question, would be, if 17 We get cooperation in scheduling the depositions, no 18 more than 60 days.
19 But secondly, I think if Mr. Spiegel goes back 20 and takes a look at his file he vill see there were 21 pieces of paper exchanged between the parties in 1980 22 which evidence that, at Brownsv111e's request, certain 23 depositions were deferred and those depositions were
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24 never taken, and I don't think there's any order extant 25 that would prevent us from taking those depositions.
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1 The deferral was granted, but not a cutoff of those i
2 depositions.
3 MR. SPIEGELS Well, Your Honor, maybe we had 4 better clarify this, because I don 't want to have 5 subpoenas on my desk tomorrow.
We all know the 6 mechanism whereby these large agencies are able to force 7 to their knees a small intervenor, and that is by 8 hitting us with depositions and trying to make us spend 9 money into the ground.
10 I think Your Honor should look at the order 11 tha t the Board entered into in I believe November of 12 '80, which cut off all depositions.
I don't want to be 13 spending a lot of money at this point -- and I am just O
14 trying to get a clearcut position stated by my client --
15 to have to have pieces of paper floating over my desk 16 which ha ve no merit, but cause me to have to answer and 17 file motions with Your Honor.
So I think maybe we 18 should abide by that ruling of November 1980.
19 JUDGE LAURENSON:
Am I correct in saying there 20 is presently an order that all discovery is held in 21 abeyance, or something to that effect?
22 MR. BOUKNIGHTs That is my understanding, Your 23 Honor, and we have no inten tion of sending Mr. Spiegel
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24 any subpoenas until Your Honor has ruled on the matters 25 now here.
I merely mentioned the point f or purposes of ALDERSON REPORTING COMPANY,INC, 400 VIRGINI A AVE., S.W., WASHINGTON, D.C. 20024 (202) 554 2345
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I 1 future scheduling, and in this ins ta nce Mr. Spiegel ha s 2 had deferred the depositions of all of his expert 3 witnesses on the grounds that at that time, since it was 4 not certain that a hearing would be required, he didn't 5 want to undergo the burden of having those witnesses 6 deposed, and he was accommodated.
7 NR. SPIEGEL:
Your Honor, whatever I agreed to 8 I will abide by.
I as a man of my word.
The position 9 tha t Brownsville had taken at that time, if carefully 10 read, wo uld indicate a ma jor possibility or likelihood 11 that there would be no hearings, and the questions are 12 questions of law being raised.
13 So what I am saying is, I understand I will 14 not have any subpoenas.
I also hope I will not be 15 getting letters and other documents pushing ahead with 18 the discovery, because my understanding is discovery has 17 been closed.
And I am undertaking to come back in the 18 time I stated with a definitive position.
I just don't 19 w an t to be harrassed, Your Honor.
20
. JUDGE LAURENSONa Whether or not discovery has 21 been foreclosed, the parties are in agreement that there 22 will be no discovery until the present motions are 23 decided and ruled upon.
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24 NR. BOUKNIGHT
( Nods af firmatively. )
25 JUDGE LAURENSON:
In the event that does not OG ALDERSON REPORTING COMPANY,INC, 400 VIRGINIA AVE., S.W., WASHINGTON, D C. 20024 (202) 554-2345
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1 dispose of'this entire proceeding, the remaining pa rtie s
[
2 will have to get back together and decide.where we co 3 from there and what the scheduling will be.
4 If there are no other matters to be resolved, 5 this conference is now adjourned.
Thank you.
6 (Whereupon, at 11:50*a.m., the prehearing 7 conference in the above-entitled matter was adjourned.)
8 9
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ALDERSON REPORTING COMPANY,INC, 400 VIRGINIA AVE., S.W., WASHINGTON. D C. 20024 (202) 554-2345
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NUCIZAR REGULATORY CO. 4ISSICN This is 00 certify that the attached pr:ceedings bef:re the M
Atomic Safety and Licensina Board l
l in the matter cf: Houston. Lighting & Power Co., Et Al., South Texas Units 1&2 & Texas Utilities Generating Co.,
Et A1., Comanche Peak Units 1 & 2
- Date cf Preceeding:
April 13, 1982 Decket Nu=ber:
50-498A and 499A and 50-445A and 446A Flace of ?receeding:
Bethesda, Maryland gre held 33 herein appears, and tha: this is the Original trsascrip tnerecf for the file cf the Cecsissd--
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Sharon Filipour Official Reper:er (Typed) 0cu. #4raas Official Repcrter (Signature) 0
_ -. _