ML20055G715
| ML20055G715 | |
| Person / Time | |
|---|---|
| Site: | South Texas  |
| Issue date: | 11/09/1988 |
| From: | Joseph Kelly NRC OFFICE OF INSPECTION & ENFORCEMENT (IE REGION IV) |
| To: | |
| Shared Package | |
| ML20055C208 | List: |
| References | |
| FOIA-89-540 NUDOCS 9007240096 | |
| Download: ML20055G715 (38) | |
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,. .. UNFFID STATES NUCLEAR REGULATORY COMBESSI0N , l l
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INVESTIGATIVE INTERVIEW OT: ) '
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JA!!ES KELLY )
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,g DATE: November 9,1988 ...~ :
Arlington, Texas LOCATION:
PAGES: 1 through 35 -y..
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- I BEFORE THE l 2 U. S. NUCLEAR REGULATORY COMMISSION l t
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l 4 Interview oft :
I JAMES KELLY :
8 i 6 . ............ q 7 Conference Room 807 l 611 Ryan Plata ;
s e Arlington, Texas
' Wednesday, November 9, 1988 l 3
10 The Interview of James Kelly commenced at ;
il 10:45 a.m., pursuant to agreement.
1 APPEARANCES:
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- For the Nuclear Regulatory Commissions !
. . , 14 SHARON CONNELLY, Director i 15 Of fice of Inspector and Auditor i
- Nuclear Regulatory Commission 16 Bethesda, Maryland 87 For the Witness, James Kelly:
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18 WALTER DRESSLAR, Attorney 3636 Executive Center Drive, Suite 201 19 Austin, Texas 78731 j L
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i I P R 0 C E E D_I N G S 2 Whereupon, 3 JAMES KELLY, 4 the witness hereinbefore named, having been first duly 8 sworn to testify the truth, the whole truth and nothing 6 but the truth, was examined and testified on his oath as 7 follows: e 8 MR. DRESSLAR: On the record, also, there's
' no chance of criminal -- This is not a criminal investic.ation 10 at any point and he's not under -- anything i;e says can't <
il be used in a criminal process later?
12 MS. CONNELLY: I'm going to read Mr. Kelly's 13 criminal rights to him. Mr. Kelly specifically asked that
. 14 he have his rights read to him. ,
18 THE WITNESS: That's not correct. ,
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16 MS. CONNELLY: That's not correct?
I 17 MR. DRESSLAR: I can tell you, if i'.'s a 18 criminal investigation and you're going to be -- I'll wait 19 till the rights cre read so I can see exactly what they 20 are and make a decision at that time. That's the easiest 21 way to do it.
' 22 MS. CONNELLY: All right. Let me explain 23 it's not necessary to read rights unless you are in a custodial 24 situation. Our rights are similar to the Miranda warning.
25 As a matter of practice and in fairness Heritage Reporting Corporation m.
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to an employee, if the case has possible criminal implications i
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2 we do advise them of their rights.
3 THE WITNESS: Right. ,,
4 MR. DRESSLAR: And once advised of criminal l 5 prosecution, the advice of his union representative would j 6 be that he not answer any questions, and if it is truly 7 a voluntary situation, he wouldn't be required to even ;
8 remain in the room for the interview.
' MS. CONNELLY: That's correct. You're totally ,
10 correct.
Il Now,'let's officially begin. My name is 12 Shar ' annelly and I'm the Director of the of fice of 13 Inspector and Auditor. l
- 14 I'm here today to follow up on some issues 1 18 that were raised by management after they reviewed an l .
16 Investigation Report we originally. issued involving possible ,
17 employment contacts that Mr. Kelly has made with the South 18 Texas plant.
19 I'll begin by asking you to review the Rights 20 Advisement. I'll read them aloud to you and if you agree L
21 to continue with the questioning, you can sign the Rights 22 Advisement and we'll proceed.
j :l 23 I am an investigator with the Office of 24 Inspector and Auditor. One of my functions is to investigate -
25 the possibility of criminal violations of federal statutes.
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4 I You have a right to remain silent if your 3
answers may tend to incriminate you. Anything you say s
3 may be used as evidence, both in an administrative proceeding 4 or in a future criminal proceeding involving you.
8 If you refuse to answer the questions posed 6 to you on the ground that the answers may tend to incriminate 7 you, you cannot be discharged solely for remaining silent.
8 However, your silence can be considered ,
l in an administrative proceeding for its evidentiary value ;
10 that is warranted by the facts surrounding your case. i 11 Do you understand these rights, Mr. Kelly?
12 THE WITNESS: I thinh I need to talk to
_' 33 Counsel.
14 MS. CONNELLY: Would you like to go off I 18 the record and step outside?
16 MR. DRESSLAR: Yes. i 17 (Discussion off the record.)
18 EXAMINATION 19 BY MS. CONNELLY:
20 Mr. Kelly, when did you first join the Nuclear 0
i 21 Regulatory Commission?
1 22 A May of 1980.
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23 0 Have you ever applied for a position at 24 the South Texas Nuclear Plant?
25 A The chief -- the Director of Corporate Security Heritoge Reporting Corporation tn .>. .
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l I for Houston Lighting & Power contacted me circa 1984 and 2 asked me if I was interested in helping them to develop 3 a Nuclear Security Department. , , ,
- 4 I at that time told him that I had to discuss 8 that contact with my management and I did do that. I contacted 6 my management and was sent to see Mr. Brown, who was the 7 attorney for the region.
8 At that time Mr. Brown reviewed the matter
' with me and advised me that I could make contact back, 10 and I did contact Mr. Parker back and briefly discussed it with him the proposal.
12 At that time I think I sent him a resume.
13 The contact was only by phone. There was no application
.' 14 form made. We had a couple of telephone conversations 15 about it.
16 We could not come to some agreement about 17 the way I wanted -- my interests and his interests were is not the same.
19 0 All right. What were your duties and 20 responsibilities at the NRC at that time?
21 A I was essentially in the same position I'm
-- 22 in now. I was an Inspector of Security.
23 0- Do you recall what assignments you were 24 working on at that particular time?
25 A At that time we had Waterford, probably. J Herttoge Reporting Co4poration m ..
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.- I Waterford was in the construction stage so we would have 2 had some contact with them.
3 We would have had some contact with Riverbend
" 4 that was in construction, Cooper, Arkansas, any of the 8 others.
6 Comanche Peak was -- I worked one time at 7 Comanche Peak on a drug investigation.
8 South Texas, you understand at that time
' that South Texas was in a construction mode. Their plans s
le were reviewed by headquarters. We did not have any decision-11 making authority or power as it related to their plans j 12 at that time.
Did you know at that time that you would 13 0 14 be eventually assigned to the South Texas plant?
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15 A Not specifically, but I knew that the fact .
l l' that we only had two inspectors, somebody was going to 17 have to do it, yes, j 18 0 When did you first have contact with anyone it at the South Texas plant in their capacity as an NRC 20 licensee, not in an employment capacity?
21 A Well, I've known Mr. Parker for some years.
.. 22 Mr. Parker is a former FBI agent and I was a former Assistant j 23 Director of the International Police Chiefs, and we knew 24 each other some time back.
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25 Mr. Parker was invited to attend meetings Heritage Reporting Corporotlon
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I that we had on a regional basis for all the security managers 3 and directors who were either operating plants or who were 3 developing plants. ..
4 so I probably began talking with Mr. Parker 8 as far back as '81, maybe.
6 0 But that is in a professional sense from --
7 A Yes, right.
8 g -- your career standpoint.
9 A And I was representing the region when we 10 were holding these meetings: I did represent the region.
II I think I was the supervisor at that time.
12 When I first met Mr. Parker, I think I was 13 the supervisor.
14 0 Did these meetings involve South Texas alone 15 or representatives --
16 A No.
17 0 -- from a number of other plants?
18 A It was a representative from every plant 19 here in the region and frequently we had people from other-20 regions came, too. It was kind of a forward thing to have 21 these meetings where we were trying to introduce the licensees
. 22 to each other and to share concepts and to share faults, 23 too, so that they could learn from each other. That was 24 the purpose of it.
28 0 What was the first involvement that you Herttoge Reporting Corporation mm
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I had with South Texas in a regulatory sense where you were 3 making decisions about, making recommendations about or L 3 reviewing any of their documentation involving any requirements 4 that they had to meet for the NRC?
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8 A I'm really at a. loss to give you time frames 6 on that. Let me try to give you some narrative. I don't L
- 7 want to try to give you inspection report numbers and things 8 which are all vague to me now.
9 We did have some contact down there about 10 some drug problems while they were in the construction Il stage, which were associated with the contractor, and there i 12 was some concern there because of their nearness to the 13 Mexican border and about the drug trade that was moving 14 back and forth through there.
18 That was well before Bruce -- I think Bruce 16 Earnest was the first one who went down there to conduct 17 an official inspection. I may have the timing out of line 18 there.
19 I may have initiated the first contact with 20 this drug stuff where they were doing their -- where they 21 were developing programs for access clearance and they
., 22 were attempting to work with the contractors.
23 0 Was that before or after you had discussions 24 with Mr. Parker?
, 25 A I think this was after. This was relatively Heritoge Reporting Corporation m.m
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I recent. They've only been in --
, If you'll recall, they 2 were snut down for a long period of time and there was t 3 nothing happening there ,,
4 At the tiv that I made the contact back 8
to Mr. Parker it was about the time when they were sort e
6 of getting all the things turned around and they were busy ;
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trying to get on site -- not on site, but get the site r
a up and ready.
So there would not have been a big horde 10 of contractors in there. So again, like I'm saying, it's Il a little vague on the timing here, but to try to give you 12 some relationships, the drug problems there would have 33 occurred after a big influx and new influx of construction 14 workers. So that would have been afterwards. >
18 0 Do you have any documents that might indicate --
16 A Yeah, I probably wrote an inspection report i
17 or a response to an allegation, or something. Some search ;
la of the records would probably harden that up in terms of 19 time.
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0 Do you believe that was the first time you 21 went on site at South Texas?
j, 22 A Yeah, I think so.
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23 0 Prior to that would there have been any 24 South Texas documents that you would have on your desk 25 for any reason whatsoever?
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- 10 I A Well, we would get copies of whatever their 2
original plans were. They would be sent to the region, 3 as are all the sites. We really would have no cause to..
4 review those at that time, because we really were working 8 with those places that were either operating or who were 6 into what we call the 2513 program, which means they are 7 in construction and we have X number of months, and it's e not years, and we just have a couple of months to go in ahead of time to review all the inspection process.
10 So those plans would have come into our
!! Documents Control Section here as a copy of those that 12 went to headquarters that were being worked at headquarters.
13 We may have even gotten copies of the plan 14 reviewers' reports from headquarters, but that was not 15 within our domain. That was not our realm. That was at l
16 that time NMSS; that was their job to do.
17 0 One last question, then, to sort of sum 18 this up. Prior to the time or during the time that you 19 applied for employment or had employment discussions with 20 South Texas, had you been assigned anything involving South 28 Texas? Were you making any decisions involving South Texas?
-- 22 Did you have any involvement at all as an NRC employee 23 with South Texas?
24 A Not to my recollection, other than that 25 relationship I had with Mr. Parker at these meetings.
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11 I MS. CONNELLY: Can we go off the record 1 for a minute.
3 (Discussion off the record.)
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- MS. CONNELLY: Back on the record.
8 BY MS. CONNELLY:
6 0 Mr. Kelly, we're going to discuss the second 7 issue. It was alleged that you had applied for a position 8 in about August 1987 at the South Texas plant.
You were at that time actively involved 10 in inspections; is that true?
II A That's correct. That was kind of a run-on 12 sentence there. Let me chop that up.
13 0 Picase do.
34 A The last half of that question, yes, I was is actively involved in conducting inspections at South Texas 16 in the summer of 1987.
17 The first half of your question is, no, 18 I never applied for a job at South Texas during that period 19 of time.
20 0 I understand that that's your position.
21 The allegation was that you had applied.
x 22 A Okay.
23 0 Why don't you just start with telling me 24 the circumstances of your discussion with South Texas of ficials 25 about the position.
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12 I MR. DRESSLAR: If I might, can we make it i
2 a little more specific.
3 MS. CONNELLY:
All right. ...
4 MR. DRESSLAP: How long were you working?
5 He was working there a long time.-
l 6 MS. CONNELLY: Well, we're talking specifically 7
about this alleged employment contact that took place in e about August of 1987. '
, MR. DRESSLAR: It's not alleged that there l
10 was more than one conversation then. Just one or more
! Il than one application in August '877 More than one contact?
i 12 One contact?
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13 MS. CONNELLY: There may have been more l
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14 than one discussion and that's what I would like to get to, t 15
, Let me be a bit more specific in posing l
- 16 the question.
17 BY MS. CONNELLY 18 0 Did you have, after your first discussions 19 about employme.it back in 1984, any subsequent discussions j
20 with anyone at South Texas regarding employment opportunities i 21 there?
l- , 22 A No.
23 0 In August of 1987 --
24 A For myself, no.
25 0 For yourself, no. All right.
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.L l During'that period of= time did you;have
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any discussions about employment for any other person?
'3 A There was someone else who made application.
4- 0 Who was that person? .
5 A You. have identified them as Mr. Caldwell ,
6 or your rc e identified him as Mr. Caldwell.
L -7 0 Did you have knowledge back in 1987 that 8
Mr. Caldwell had applied for a position at South Texas _?
9 A Yes, I did. I'm not sure " applied" is the.
10 ,right terminology.
Il MR. DRESSLAR: If I might, we're sort of :
12 throwing these words around. Applied to one person means 13 a totally different thing than to another. i
.. a e 14 My understanding, as limited as-it is,-being is called on short notice again, but that no one applied to 16 STP for a position that I know of. At least none'of the i
17 people that I'm involved with. I can't speak of anybody 18 .else outside of those people.
19 But my understanding is that no one applied, 20 using the term as I know it, to STP.
21 MS. CONNELLY: All right'.
- i. 22 BY MS. CONNELLY:
N'$'
23 O Mr. Kelly, what is your understanding of 24 Mr. Caldwell's contacts with South Texas involving employment 25 with South Texas?
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l 'A Mr. Caldwell, as I, knew-that South Texas y
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2 was seeking someone to be the manager, on-site manager 3
of. security for nuclear activities. They had engaged p,qrsonnel J t They had contacted all-the security chiefs 4 representatives. "
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at the other sites.
6 Mr. Caldwell advised me that he had an interest 7
in applying or contacting the manager, the corporate officer
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8 to instruct him or to inform him that he did have an interost, and Mr. Caldwell advised me that he had talked with his ,
L 10 management about it.
II He made a telephone-contact I'm told, with L 12 Mr. Vaughn, who was the vice president.
13 0 Did you then have a discussion with anyone 14 at the :as plant about Mr. Caldwell's interest 15 in emp' ymes.c? -
16 t,. ,
' a discussion with Larry George, who 17 is no' c, if 4 -4 1 of that corporation, but a security 18 supervu*r who confided in me some of the problems that E 19- he was having and I did have a dialogue with him, because I
20 he himself was concerned about losing his job. . I s
21 I did not mention Mr. Caldwell's name.
l 4 22 MR. DRESSLAR: I didn't get the name of 23 the person that you talked to.
24 Tile WITNESS: Larry George, G-e-o-r-g-e. t 25 MR. DRESSLAR: !!is position was what, did L Heritage Reporting Corporation m ,. .
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2 I THE WITNESS: He was supervisor: at the site.
3 He did work for the; utility. I'd known him for several.
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-years and I had a lot of respect for him. I 5
BY MS. C?#dELLF1 6
'O Was the ;unition that was available a superior.
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i position to Mr. George's position? I 8
A 'Yes, several, three, four layers above. .
9 Q How did you first learn that the position f H) was available?
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A Well, we were aware that Mr. Hill had departed, '
12-so since we were responsible for monitoring the management 13 n
ef fectiveness of the security program, we were aware that 14 there was a void there. There was nobody in -- actually, '
15 I guess, three~1ayers were out of there.
16 we.alsoTknew from our other inspection a
17 activities from the other security managers'at the other i
18 sites that each of them had been contacted. ,
19 0 I'm sorry. Which managers from which other 20 sites? Are you talking about licensee managers?
21 ' A Yes. Yes.
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- 22- 0 Okay.
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23 A-Serarity, the security managers at each 24 of the other sites in our region.
25- Q Each of the other licensee sites?
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-, I- A Correct. Yeah.
2' .
O Did anyone ever contact you directly --
3-A Yes.
4 0
-- about your interest in employment?
5 A Yes. t 6
0 And who was that? !
7 A
some headhunter. !
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0 Do you recall who it was? ,
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'A No, I' don't, but that's not unusual. That '
10 goes on all the time, >
11-The reason I'm not any more specific than 12 that is that I already knew that they were looking for i i
13 somebody.
I already knew I was not interested in it. So
- 14 there was no reason for me to get into any discussion with -
15 this headhunter.
16 --
0 What was the nature of. your discussion with -
17 the headhunter?
18 A
>, . Did I know that there was a position available 19 down there at South Texas and was I interested'in leaving 20 the NRC; that kind of thing. i 21 Q
1 How did you leave it with the headhunter?
22 A I told him I was not-interested, but don't i 23 throw my phone number away.
24 ,
I think you know that that's pretty much l 25 a common practice in this industry, that these fellows 1
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- 1 I did 'tell him, af ter= I, had an opportunity to -look at the- l 2
report, that I mentioned to him about the headhunter ~ contacting
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3 me and I^think I did mention to him about all the securi,ty r
4 managers at the other sites-told us that they had been F 3 down here and been. interviewed.. Candidly, nobody wanted 4
the job because there were still a number of problems in 7 trying to get all these flaws taken care of.
yg 8 Well, there's no need getting involved in
- all the reasons why they were in trouble to start with.
10 I think you have the investigation from the office of II Investigations about the falsified files and --
12 0 Yes, I think that Ms. Rowe has pursued that.
- 13 A Yeah.
, 14 0 .Did you have any discussions'with anybody.
15 else at South Texas regarding this particular position 16 that was' vacant?
.t 17 A Well, bear in mind.that part of the inspection 18- process, we have a procedure that -- two procedures in i
19 fact that deal with that subject. We had-correspondence :
20 from the utility corporate officers telling us that they 21 were' seeking to fill that position, and it was an outstanding 1
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-item that needed clarification and correction before 23' licensing.
24 So we had frequent discussions. Bear in 25 mind that we were there 24 hours2.777778e-4 days <br />0.00667 hours <br />3.968254e-5 weeks <br />9.132e-6 months <br /> a day for some six months Heritage Reporting Corporation
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L 19' l- or something.- So a big blackboard, number one item on:
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/. 2 the blackboard is the organization of- how this place is 3
going to get under control here in terms of the troops ,
~- 4 So there were a lot of discussions.
8 Specifically, following up on the George 6
1hing, I did realize that I had confused George because 7
I gave nobody's name. This was just candidly grousing 8
about, you know, here we are one more time kind of thing.
At another time Larry Kern, who himself-10 was worried about his position --
II O What was Mr. Kern's position?
12 A He was the acting security manager,
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, , , 0 Was that the position that was available, 14 that was vacant?
15 A Well, yes, except that he was.not really 16 a candidate for it. He was serving as a temporary manager 17 and we were cooperating very well. We had begun to really 18 make some progress through Mr. Kern and we valued his opinion l' and hie efforts.
20 Consequently, again, there developed a 21 communication, a free communication. As I look back on.
.... 22 it now, I must admit to you that it was too free on my 23 part, but yeah.
24 0 Did you discuss with Mr. Kern Mr. Caldwell's 25 interest in the position?
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- 3 A I told them>that Mr. Caldwell was the one v 2- w ho had applied for and, again, that word " applied" is 3
not-a good word to use, I think, because it infers to na
" - 4 paporwork.was filled out, negotiations and all that sort 8
of thing.
But I did tell them that Mr. Caldwell'was 7 the inspector that had made the contact, but then it wasz 8
all over. This was a week later.
O You told this to who now? I'm sorry.
10 A- To I guess both Larry George and Mr. Kern ll' were sitting there in this conversation. . The question 12 was raised, you know, like, "Who in the world were you 13 talking about," or something. I don't remember the specifics 14 of the conversation.
15 0 So the two of them were in the room at the l' time?
17 - k Yeah, I think so. At that time it didn't 18 - seem like any mystery to me. I thought that this fellow 19 Vaughn would have di,scussed it with Kern.
20 Sure.
0 21 A There was no reason for him to discuss it
, - 22 with George because George was still a couple of tiers 23 down from there, but I thought that he would have talked 24 with Kern about it.
25 But he hadn't and that was why this thing Herttoge Reporting Corporation mn .n ,
21 got muddied.
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2 O Did you mention Caldwell's name to. Kern?
3 A Yes, I did tell him. I did tell him tha,t's 4- who --
8 0 So Kern knew that --
6 A At that time he knew.
7 0 Okay. Kern knew it was Caldwell then?
s A- Right, but again I emphasize the transaction
' was past, several days past, opened and closed.
10 0 I'm a bit confused.- When you had your 11 conversation with Larry George, had the incident passed?
12 A Yes. As I best recall it, it was that very 13 afternoon. Remember, the situation with Caldwell lasted 14 maybe an hour at the most, from the time that he contacted
!$ our branch chief, notified me, -made the contact and then 16 got back to me telling nie that it was all of f and over 17 with.
18 0 Did you ever ask Mr. Kern about the 19 possibility of employment with South Texas for_yourself?,
20 - A No, I was not interested.
21 0 All right. When you spoke with Larry George,
-- 22 did you -- Let me back up a second.
- a. -
23 You have a criminal justice background?
24 A Correct.
25 0 Do you have a -- I understand you have Heritage Reporting Corporation smun<een
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22-I extensive experience in the criminal justice field?
4 2 A That's correct.
3 0 Do you-have a degree-in criminal justice?,.
' 4- A Yes, I do, in criminology. !
5 0 In criminology?
6 A Yes.
7 0 What about Mr. Caldwell?
8 A Mr. Caldwell has a master's degree in business
' administration, MBA, and he's a former Navy nuclear security to officer.
l l Il 0 And the undergraduate degree is'not'in criminal 1
12 justice, either?
13 A I don't know. I don't recall. J v' l 14 0 He was a- nuclear security --
15 A He was an officer in the United States Navy. l 1
16- MR. DRESSLAR: What-are we getting into '
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17 here? I know we're not 'irt a court' of law, but you could l
18 - ask Mr. Caldwell those questions.
19 MS. CONNELLY _ Yes, I could, but I have 20 Mr. Kelly here right now.
21 MR. DRESSLAR: He's only speaking on what 22 probably at the very .least is maybe what Mr. Caldwell told 2
23: him and maybe what several other people have told him, 24 unless he was a teacher at the institution that granted 25 him a degree.
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- I MS. CONNELLY: I'm interested in what Mr.
2 Kelly's knowledge is of Mr. Caldwell's qualifications. I 3 I think that will become pretty clear in a few minutese. i 4 BY MS. CONNELLY 8
0 I'm going to show you a memorandum that
' Larry George apparently wrote on: August the 21st describing l r
7 the conversation and basically what he says in the memo, a and it'm just going to -- it's very short. I'll read it
' for the record.
l- 10 "On or about the week of August 10th, 1987, .
1 11 Mr. James Kelly contacted me about a previous discussion 12 we had about the best plant for criminal justice graduates I
13 to gain nuclear operating experience. After our discussion 14 Mr.' Kelly told me that a headhunter had contacted him about 15 your position. Mr. Kelly asked me if I thought upper management ,
.i l' . would consider-him for the position. I told him no,-because 17 in my opinion politically it probably would not look good .
- 18 and raise a lot of questions. He said that's what he figured, 9
19 also. Later the same day Mr. C. L. Kern advised me that 20 Mr. Kelly had discussed the same issue (your position) 21 with him, also."
}-.
. 22- Now, I'd like for you to look at this memorandus 23 and let's just take it piece-by-piece, and I'd like to o i L 24 hear your position on this conversation.
M A Okay.
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. l MS. CONNELLY: Let's go off the record.
2 (Discussion-off the record.)
3 MS. CONNELLY: Back on the record. --
4 BY MS. CONNELLY:
5 0 Did you have a conversation approximately 6 the week of August 10th, 1987, with Larry George about 7 "the best plant for criminal justice graduates to gain a nuclear operating experience"?
' A Time frame doesn't pull together there.
10 They were recruiting at all levels, supervisors and otherwise, 11 and yes, it was my opinion that that would be a good place 12 for sergeants, lieutenants, shift supervisors to gain.
j 83 experience.
. 14 - 0 I'm sorry. Can you clarify that a bit more?
15 Which groups of people are you talking about, people who 16 are already employed?
17 A No. They had a number of . vacancies. They 18 were looking for lieutenants. They were looking for shift 19 supervisors.
20- And they asked me where they could recruit 21 people and~ I told them to go to the universities that had 22 criminal justice programs.
23 I am not a criminal justice major. I am 24 an old soldier. They didn't have criminal justice programs 25 when I got my master's degree.
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I MR. DRESSLAR: What was the date on tnat?
I .
2 MS. CONNELLY: The date that --
3 -MR DRESSLARt 8-21-87. ..
4 MS. CONNELLY: Right and he's referring.
8 to a conversation'that took place on August 10th, and he's 6 referring to a previous discussion that you had about "the 7 best plants for criminal justice graduates."
8 MR. DRESSLAR: What is "the best plant"?
THE WITNESS: That facility was a large 10 facility. It was complex. Nuclear security is a whole 11 new field that has come into being and the guys graduating 12 from Michigan State or Florida State or George State where 13 they have police administration programs or criminal justice 14 programs, it would be a darn good place for them to -etep is off as a lieutenant or even a sergeant and begin a career 16 in that business.
17 [ Witness and his counsel confer.]
18 BY MS. CONNELLY:
l' O Which criminal justice graduates were you --
20 A No individuals. That's a general recruitment 21 category.
22 0 What was your interest in the riu.inal justice 23 - graduates?
24 A He posed the question to .cc, asked me about
. 25 where could they recruit people. He 'id -- Larry George Heritage Reporting i m. otion one a
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26 1 at that time, when we had those discussions,-he was the 2 developer, I think, of.their Access Authorization _ Programs,
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3 or something lika that.
4 0 Okay, so you had the' discussion. You had 5- a prior discussion, a discussion prior to August 10th --
6- L Yeah. Well, I mean, I'm trying to make- j i
7 sense out of what he wrote there. l l
8- I MR. DRESSLAR: One of the problems I have j
here, if we're still talking about the same thing -- maybe- 1 10 we're into another area. I don't know. Mr. Hill -- .He il says it's written to Mr. Hill. Mr. Hill held the position !
i 12- that we're talking about as being open. Obviously, Mr.. Hill j
<!3 had not left the position. That position wasn't'even open- l 14 at that time. ,
15 So I don't know what we're.getting into 16 again. That's what lt was asking about. I don't see --
i 17 Mr. Hill apparently was working for HL&P at that time and 18 his position wasn't open so we couldn't necessarily -- (
l' at least I don't see it necessarily flowing that we're l 20- talking about the position that apparently those allegations 21 that Mr. Caldwell applied for that position. It couldn't- l
... 22' 'be the same one or the allegation that you raise about 23 Mr. Kelly, that there be some allegation written by someone 24 somewhere thet he applied for that position, because Hill 25 was holding that position.
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't L MS. CONNELLY: That's an interesting' point.
o.
2 At this point in time - -
3 MR. DRESSLAR: All I'm saying.is that , , .
4 certaintly-fits --
5 MS. CONNELLY: -- there.was not a position 6 available?
7' THE WITNESS: Yeah, that's why it doesn't 8 make any sense to me. I don't deny that I talked to Larry 9 George about Ron Caldwell's --
10 BY MS. CONNELLY:
11 0 What position was Mr. Caldwell interested in?
12 A I don't know. That whole thing confuses 13 me . . I don't think it has anything to do with the same 34 question you started off with, myself.
15 'O All right. When Mr. Caldwell had indicated 16 that he was interested in a position with South Texas, 17 what position was he interested in?
18 A Mr. Hill.
19 0 It was Mr. Hill's position?
20 .. The position that Mr. Hill vacated, and 21 they were out there recruiting big time.
. 22 O And this was af ter Mr. Hill had lef t?
23 A That's correct.
24 0 When Mr. Caldwell's interest became known?
25 A That's correct.
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28 i e l- 0- Do you know what period of time that was? !
2 A. No, I don' t. To be honest withfyou, you-3 guys'have been feeding me-the dates-and I haven't gone ,,
4 back to check on it, since I've never seen this piece of L
8 paper before.
6 So you're telling me that during that period 7 of' time Mr. Hill's job was open and I assumed it was, but i 8 it doesn't make any sense to me now. l 9 I thought I understood what you were asking to me before, but'now I-don't.
Il 0 Actually, all we're telling you is that 12 on this date Mr. George prepared a' memo that said that-33~ you had contacted him and said that a headhunter had contacted .
34 you about Mr. Hill's position.
18 A Yeah, 16 0 And what you're.saying.to us,is that as 17 of this date you don't believe the position was even open?
.]
18 A Yeah. A headhunter did contact me, yes.
19 I did tell Mr. George about that. We discussed it. I ,
20 wasn't interested in the job.
21 0 Do you think this date might --
.- 22 A Yeah, I think something is wrong there. ;
23 I think there's apples and oranges mixed up there and I 24' kind of even halfway now wonder if the whole thing wasn't 25 postdated or predated or something.
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L -t .There's two'different-issues involved there.
2 O Do you k'now Mr. George personally? ;
.i 3 A Yes', I do. , , _
'4 -MR. DRESSLAR: What does " personally" mean?~ !
$ BY MS. CONNELLY:
6 -0 Mr. George is a security person; is that -[
s 7 correct?
i e A Correct, yes.
9- 0 And Mr. Kelly is a security -- ,
i 10 A Yeah. Professionally,-I think, would be- t
!! a better word. l t
- 12 0 Professionally, all right.
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13 A Yeah.
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' 14 Q. Do you have reason to believe that Mr. George }
15 would have --
16 A No, I don't. j 17 0' -- falsified this document? q 18- A No, I don' t. I think the whole thing is j 19 some big mixmaster here. Under the. circumstances I can't 20- talk to Mr. George or Mr. George can't talk to me. So f h -
21 we're stuck with a bunch of malcontents who probably would
,% 22 like to get a piece of both Mr. George and I, because-Mr.
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- 23 George had been very helpful in providing information to 24 us about what the flaws were in that system.
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. 25 0 All right. So you think the date is wrong?
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I You think that this is -- ,
2' MR.-DRESSLAR: I think you're asking him :
3 -to make conclusions that -- All I raised was I thought 4 we had been talking about Mr. Hill's position being open.
L 5 I looked at that memo. It said, "From George, To Hill." :
6 Apparently Hill was in some capacity on HL&P letterhead, l t
7 as a superior I suppose, to Mr. George.
8 How could we be talking about Mr. Hill's 9 position if it was filled, and that was just my question. _;
l 10 MS. CONNELLY: Perhaps Mr. Hill may have o =
11 known that the position was going to be vacant. I don't 12 know'the answer to that question.
13 THE WITNESS: Well, that wouldn't, work,
~. h 34 either, because if Mr. Hill was still there, we would not is have-known that his job was open.
~ 16 BY MS.-CONNELLY: ,
a 17' O As you recall, when you found out that the ,
18 job was open, Mr. Hill had already left? ,
4 HP A Yeah, he was gone.
20 MR. DRESSLAR: I think he testified that l 21 there was an open item, which-would have been Mr. Hill's 22: position at that time that needed to be filled according .
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24 THE WITNESS: That's more accurate, yes.
25 MS. CONNELLY: All right.
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- IL BY MS. CONNELLY 2 0 Let's still address each offthe items in_
3
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the memorandum and then we can do followup to see what,,,
4 the status of Mr. Hill's position was at that point in 5- time.
6 MR. DRESSLAR: I think let's start at the 7 beginning. All these allegations flowed against inspectors,-
a let's say, in a very difficult project', to say the least.
9 They don't know what's going on because-10- they-don't see these things till after they are handed
-Il to them at some investigatory interview, and I'm not saying 12 it's the Agency's doing, but somewhere along the line a 13 ' mistake has been made in the allegations that someone else 14 is making, in the time frame that somebody is thinking-15 under, and I don't think it's fair ~to' continue to ask Mr.
, 16 Kelly about those things when first the Agency:should clear 17 it up or at least get the dates right so any question he 18 -answers can't be somehow turned around at a later date 19 to say, "Well, you told us this on this date. We come 20 back with this information later."
21 He has stated he's not clear as to what 22 that memo does now because of the date problems.
23 MS. CONNELLY: I can rephrase the question 24 to get around the date problem and I would like Mr. Kelly 25 to answer the question unless you so advise him that he Heritage Reporting Corporation imm.
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e- I should not answer.
2 BY MS. CONNELLY: '
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Q Did you tell Mr. Kelly at any time -- I-~ I 1
4 apologize.-
5 Did you tell Mr. George at any time that )
a headhunter had contacted you about Mr. Hill's position?
7 A Yes. "
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-s 0 Did you ask Mr. George if he thought upper management would consider you for the position?
10 A No, and I emphasize the word, would they II' consider me. The answer to that is no.
12 That conversation about the headhunter and I3 NRC inspector was done at the same time, but not in that i
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14 sequence.
15 The first discussion was about the inspector. .
16 As a form of explanation to- make sure that h'e -- I thought -- .:
17 I was trying to get him to understand what we were talking-38 about, and that was that somebody was out there recruiting 19 people for that_ job and all the security chiefs had been 20 contacted.
21-0 You were advising Mr. George of this, that -- :
22 A No. Everybody knew -- At that time that 23 discussion went on, everybody knew that people were being 24 brought in from all over for interviews for that job.
25 y
0 Why did you indicate to Mr. George the Heritage Reporting Corporofion
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' I headhunter: had contacted you?
It was 5 A Well, as a part of the discussion.
3 kind of like the tail end.- I said, "They've talked to....
4' everybody. They've talked to all of the security chiefs.-
i 5 They even talked to me." Like that. r 6 0 Why do you believe Mr. George would write 7 this memorandum, because this is pretty' clear. It's not --
8 A It's sure not clear to me. It's'all mixed 9 up. . There's different things, different events, different'
, a 10 discussions all kind of rolled into one there that doesn't i 11 fit very well in the time reference for me. 7 12 0 Did you have an adversarial relationship 13 with Mr. George?
l l 14- A No, I did not. 'I had what:I considered l
18 to be an excellent working relationship with him, and I 16- had respect foa him.
-i 17 That's why I'still think there's some confusion 18 about all that. You asked me earlier did I think that j
19 Mr. George would deliberately manufacture something and !
20 I think the answer to that is no, I do not.
21 MS. CONNELLY: That's all the questions
- 22 that I have.
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23 MR. DRESSLAR: I'd like to at least say L.
24 something about -- because of the confusing nature of this L
25 whole line of questioning, you might want to say something ;
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-*L I about the timeLthat we're talking;about and what was actually 2 going.on during that period of time regarding open positions 3 at STP.
4 THE WITNESS: Yes, South Texas Project.
8 MS. CONNELLY: Sure, go right ahead.
6 THE WITNESS: We have two inspection procedures
! 7 that had outstanding open itecs listed with them. One was management ef fectiveness and the other one was security 8
' organization.
10 Both of those dealt with filling these il supervisor jobs, with filling the manager's- positions at 12 several different levels. Bear in mind that there were 13 a number of people being changed around within that organizatio n.
14 Sitting right up on the blackboard in our 15 conference room or our command center were'these items-16 to be filled out. We had correspondence from the. utility 17 - to our management e. bout' how- they were searching for people -
18 to fill those slots and how they committed to.having all 19 those positions filled and people in place and trained 20 before the license would go into effect. This is the operating 21 license.
22 They were actively looking for people. That's 23 where that conversation with George came about. You know, 24 where do we find people to fill these lieutenant jobs and 25 these sergeants' jobs and so forth.
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- l Go to the universities. Go to the junior 2 colleges. That's me responding to Mr. George,-to find 3 young people who would come'in-here, who would be educated 4 and would be' prepared to grow into the industry.
5- That's what that discussion was all about.
' That's why -- that's the nature of this whole relationship ~ ,
7 about people and jobs and recruiting and, hence, there's 8 the background'and a basis to have this conversation on I
' a recurring -- a daily basis and actually provides a platform, i-10 also, for me to allow myself to get into what I considered il at that time to be a casual conversation about even somebody j i
12 from the NRC applied. j 13 That's the nature. That was sort of the 14 tone or the tenor of that conversation.
15 There were hundreds of people who were applying 16 town there, all. kinds. They were trying to sort it out, 17- how they were going to figure out who it is and what they is were' going to do. That's the nature of all this.
19 MS. CONNELLY: I appreciate your clarifying !
20 that for us, Mr. Kelly. Thank you very much.
21 (Whereupon, at 11:54 a.m. , the interview 4 .
22 ceased.]
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1 24 25 R Heritage Reporting Corporation 1
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l fERTI FICATE 2
3 I hereby certify that this is the trans 4 of the proceedings held before the NUCLEAR REGULATORY
$ COMMISSION on November 9, 1988, Interview of JAMES KELLY, 6 and that this is a full and correct transcription of the 7 proceedings.
8 9 n (fjh o'%
Betty Mrgan \ s .l 10 k Heritage Reporting Corporation 11 12 .
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FINAL REPLY l
'SHARON R. CONNELLY- .
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