ML20062A501

Forwards Matl from Shoreham Proceeding Containing Discussion & Analysis of Question of Potential Conflict of Interest by Science Applications,Inc

ML20062A501
Person / Time
Site:	Limerick
Issue date:	08/02/1982
From:	Lewis S NRC OFFICE OF THE EXECUTIVE LEGAL DIRECTOR (OELD)
To:	Brenner L, Cole R, Morris P Atomic Safety and Licensing Board Panel
References
NUDOCS 8208040021
Download: ML20062A501 (2)

Text

August 2, 1982 Lawrence Brenner, Esq., Chairman Dr. Richard F. Cole Administrative Judge Administrative Judge U.S. Nuclear Regulatory Commission U.S. Nuclear Regulatory Commission Washington, D.C.

20555 Washington, D.C.

20555 Dr. Peter A. Morris Administrative Judge U.S. Nuclear Regulatory Commission Washington, D.C.

20555 In the Matter of PHILADELPHIA ELECTRIC COMPANY (Limerick Generating Station, Units 1 and 2)

Docket Nos. 50-352 and 50-353

Dear Administrative Judges:

Pursuant to the request of the Atomic Safety and Licensing Board presiding over the Shoreham proceeding (Tr. 5711), the Staff is providing to the Board and parties in the Limerick proceeding material which contains discussion and analysis of a question raised by the Board regarding whether Science Applications, Inc. (SAI) may have a conflict of interest because of PRA and systems interaction work it has done for NRC licensees and for the NRC Staff.

The Staff also addressed in the enclosed reports the question of whether the roles played by SAI might have resulted in a lack of independence in the Staff's review of the Shoreham and Limerick PRA's. Additionally, the Staff conducted an analysis of whether NUS (a peer reviewer of the PRA's for Shoreham and Limerick) might have a similar conflict of interest because of work it has performed for NRC licensees and the Staff. The results of that analysis are also contained in the attached Staff reports.

l The following material is provided under cover of this letter:

l 1.

Tr. 5348-51, 5420-22, 5707-12, 6340-46, 7427-30.

2.

"LILC0's Response to the Board's Request for Information Concerning Science Applications, Inc." (July 1, 1982).

3.

"NRC Staff Interim Report on Involvement of SAI and NUS As l

Contractors for the Staff" (July 1,1982).

i

'IEST'fE ORIGINAy;

_ died By b

O 4.

"NRC Staff Final Report on Involvement of SAI and NUS As Contractors For the Staff" (July 23,1982).

Sincerely, I

Stephe H. Lewis Counsel for NRC Staff

Enclosures:

As stated cc w/ enclosure:

Walter W. Cohen Robert W. Adler Steven P. Hershey, Esq.

Mr. Frank R. Romano Donald S. Bronstein, Esq.

Robert J. Sugannan, Esq.

Judith A. Dorsey, Esq.

Mr. Edward G. Bauer, Jr.

Troy B. Conner, Jr., Esq.

Mark J. Wetterhahn, Esq.

Mr. Marvin I. Lewis James M. Neill, Esq.

Joseph H. White III Dr. Judith H. Johnsrud Thomas Gerusky Dir. Pa. Emer. Mgmt Agncy Alan J. Nogee Robert L. Anthony Charles W. Elliott, Esq.

W. Wilson Goode NRC Docketing and Service Section Atomic Safety & Licensing Board Atomic Safety & Licensing Appeal Panel DISTRIBUTION:

NRC Docket LPDR PDR FF (2)

Murray Christenbury/Scinto Rutberg Chandlerg Lewis Hodgdon Chan Schwencer Abelson y

Chron.

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OFC : OELD

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NAME :Slewis:acm Rutberg

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1 DNITED STATES OF AMERICA 2

NUCLEAR REGULATORY COMMISSION 3

BEFORE THE ATOMIC SAFETY AND LICENSING BOARD 4

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5 In t,he Matter of s

6 LONG ISLAND LIGHTING COMPANY Docket No. 50-322-OL 7

(Shoreham Nuclear Power Station) :

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P 10 Riverhead Town Hall 11 200 Howell Avenue t

12 Riverhead, New York 11901 l

13 Thursday, June 24, 1982 i

14 The hearing in the above-entitled matter 15 reconvened, pursuant to recess, at 9:05 a.m.

16 BEFORE:

L 17 LAWRENCE BRENNER, Chairman I

18 Administrative Judge i.

19 JAMES CARPENTER, Hember 20 Administrative Judge i

21 PETER A. MORRIS, Member 22 Administrative Judge 23 WALTER H. JORDAN, Assistant to the Board (h

24 Administrative Judge 25 ALDERSON REPORTING COMPANY. INC.

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1 departing in any event.

That would make a dif f er en ce, j

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or could make a difference, and we will look at it again.

3 There is another reason why we have to i

4 maintain flexibility.

Last week we mentioned that we c-5

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5 directed the parties to jointly propose a schedule i

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leadino to the completion of discovery on the emergency

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LILCO emergency planning, and we have not 7

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heard anything.

We expected to hear this week, since R

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's what we have proposed as a completion date would be the 2

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10 end of July, and we certainly want to hear by tomorrow f

11 so we can ha ve a dialogue about it if necessary.

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12 (Board conferring.)

t 13 That is all the procedural ma tters unrela ted 9

i 14 to Contention 7B.

We have another preliminary matter t

Ly 15 related to contention 7B which we are prepared to 4

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17 procedural matters that any of the parties wish to raise.

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( No response. )

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Z' 19 Yesterday, we received the revised staff cross y

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20 exa mina tion plan for Suf folk County / SOC Con tention 7B,

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23 that cross examination plan -- and as indicated, the L

n 24 attachment has been provided to all of the parties --

25 was a memorandum from M r. James H. Conran who is f

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scheduled to be a staff witness on 7B to Mr. Thadani of y

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2 the NRC staff.

And it vent through the section chief, f

3 Mr. Coffman.

R The board had an opportunity to read that in 4

5 some detail last evening.

We had not read it earlier k

6 than th a t.

It is quite a thick attachment, and 7

presumably, the substance of this will come up in the r-8 context of either the cross examination or the further y

9 testimony prepared by the staf f and so on.

But one 10 point that was new to the members of this Board appears R

f f 11 on the first page of the meeting summary and status

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12 report.

That is the first page of the attachment to the J

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13 cover memorandum.

And it is indicated there tha t one of the 14 15 staff's consultant contractors for the staf f's review of pn 18 the Indian Point PRA including the systems interactions y

studies is SAI.

This was certainly news to this Board.

's 17 I would like to ask the staff if that is the same SAI

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tha t is a contractor for LILCO in this proceeding and, ju b;

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.I 20 in fact, 21 proceeding.

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MR. RAWSON:

Judge Brenner, I understand tha t 22 23 the SAI in question is, in fact, the same organization,

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1 branch dealing with the Pasny matter as opposed to the t

2 other section thst you mentioned.

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JUDGE BRENNER:

Well, preliminarily, this y

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4 information certainly would have been useful and helpful t

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5 for this Board to know, and we should have been apprised II N

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6 of that.

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I would also note but not pursue here that as J.

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the parties know, Judge Morris and I sit on the Limerick b[

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to respect to that PRA and the staff review that would be r

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'11 conducted and so on, and it was never disclosed to us b-12 the re. that SAI is a staff contractor.

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13 In addition, I learned this morning th a t the u

1-14 Chairman of the Indian Point Board in the hearing this

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I worry about 3';

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16 the other cases in other contexts, but for now.

J 17 restricting it to Shoreham, we would like an assessment,

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s a report, whatever you want to call it, from the staff

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whether SAI's involvement in these various studies for

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21 various plants for the staff and utilities raises any

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22 conflict of interest problems, in th e legal sense, and if 23 also, any problems in terms of beyond just the na rrow gj Ni the normal procedural separation that h

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inpot in the form of assessments or testimony of both ti:

2 from the utility and its consultants on the one hand,

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and from the staff snd its consultants on the other hand.

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4 Bear in mind that some of the testimony we 3

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Shoreham PRA is comparable to what was alluded to as the f

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industry standard; namely, these other studies that SAI t

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8 is apparently doing.

We now learn its involvement.

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9 obviously do not know any other details beyond what I h h

'h 10 have just disclosed.

I do not know what the involvement

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'11 of SAI has been with the staff and so on.

So we are 12 interested in that assessment.

,I ',e 13 As part of that, we want to know why this fact lli.g 14 was not disclosed to this Board or other boards.

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15 sooner we get it, the better.

I hope by next Thursday.

j 16 I guess that is our da te, unless the parties show good 4

17 cause why that should be extended.

We would like to

2 18 receive that report next Thursday, which is July 7th, I (h

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8th.

I am sorry, that is July 1st.

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!! R. LANPHER:

Judge Brenner, is that date the

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I knowledgeable a panel'for this broad subject, and yet 2

there are others that we would like to present on 3

specific narrower issues.

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4 4

The second issue I would like to raise with 5

the Board is the matter you raised this morning, Judge 6

Brenner, relating to SAI being noted on the memorandum 7

as an NRC ransultant.

We also want to look into this.

8 But may I have some guidance from the Board as to the i

9 nature of the co.ncern so th'at we can prepare to gather l

10 the right information and think about the right issues?

it It may just be my unfamiliarity with the general issue.

s, 12 I think consultants consult over a broad range.

I am 13 not sure.

I have not had an opportunity to review

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resumes, but I think even maybe some of the Intervenor's 14 5

15 consultants have consulted with the NRC, and so I needed i

b 16 to have, if the Board is willing, I needed to have some 0

17 guidance so that we could look into this matter.

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18 JUDGE BRENNERa I will tell you I was very i

19 careful about not saying too much prematurely, and 20 recognizing that sometimes what a Board says is carried 21 beyond the immedista rontext of being just a preliminary 22 inquiry, which is all it was.

And you would be advised 23 not to stimulate too much on my part too early.

f 24 Why don't you take a look at the transcript?

25 Offhand I do not think I could say -- I am sure I could O

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1 say it better, but I do not think I would add any 2

additional substance to wha t I said this morning.

And I 3

think in large pa rt the ansvers to your question vill l

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appear as you look into what the situation is.

I was 5

careful not to restrict it to conflict of interest in 6

onIy the technical sense, the narrow technical legal 7

sense, but in terms of propriety in a proceeding.

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8 if extra 01re is deemed appropriate in a proceeding in l

9 terms of testimony, that should be taken into account.

to And I emphasize the "i f. "

11 And I also had in mind the cross reference; in 12 terms of this is the way it is done and therefore it is 13 good, and then to find out that it is the same outfit 14 involved in all of it raised a preliminary concern, and 15 I emphasize the " preliminary."

And although I was 16 purposely low-keyed, I as frankly not happy.

And here 17 you get into the area that I did not want to stimulate 18 further response.

19 I am not happy that I learned about it for the 20 first time in an offhand, arcane passing comment in a 21 memo, intrastaff aeno attached as an afterthought f or a 22 totally different purpose, especially when I am sitting 23 on two proceedings along with Judge Morris, this and h

24 Limerick, where we have talked about PBA ad infinitum in 25 the prehearing context in the other proceeding, and O

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1 SAI's involvement and the Staff's review, and then to 2

find out that SAI is on both sides of the fence arguably.

3 So I want to know why I did not know before h

4 now in addition to the more substantive situation.

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5 I want to emphasize that it is a preliminary inquiry, 8

and no inferences should be drawn from the inquiry other 7

than you might as well draw the inference that you 8

should have told us.

I should not have had to ask for g

it -

"you" being everybody out there who knew, whoever 10 they are.

And obviously that is the Staff. - I do not 11 know what LILCO's knowledge was or counsel for LILCO's 12 knowledge.

It is a nondisclosure.

Whether or not it is 13 a material nondisclosure will avait further advice from O

14 the parties.

15 All right.

Let's come back at 1:20 instead of 18 1:15.

17 (Whereupon, at 12:05 p.m.,

the hearing was 18 recessed for lunch, to be reconvened at 1:20 p.m.,

the tg same day.)

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LONG ISLAND LIGHTING COMPANY DOCKET NO. 50-322-OL (Shoreham Nuclear Power. Station) 15:

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1 How is that taken care of in the filing we 2

received today7 I

3 MR. LANPHER:

We received that filing at the 4

end of last week at the same time you did, Judge 5

B.renner, and my understanding is that my colleagues in i

6 Washington spent a substantial portion of the weekend 7

taking P. r. Shapiro's filing and putting it in what we 8

served on you today.

And my understanding is that it is l*

9 all in there.

I can confirm that by phone later this

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10 morning.

That is my understanding.

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l 11 JUDGE BRENNER:

All right.

If you can let us l

12 know tomorrow or the next day, that would be helpful.

l 13 And we are hoping we can focus on one document.

14 We received the written filings of LILCO and I

15 the staff with respect to the question we raised of the 16 cole of Science Applica tions, Inc., S AI.

S taff's filing

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I 17 contemplates an openended, unscheduled further filing.

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18 Obviously, we cannot leave it at that.

We have a l

f 19 schedule in mind, but I.will ask the staff first.

20 MR. RAWSON.

Judge Brenner, as ve. indicated in 21 the pleading, we are con tin uin g to investigate and 22 gather facts on this matter.

Part of the difficulty is 23 caused by the fact that some of the contact's that both 24 LILCO and we have discussed are in the cont, ext of 25 subcontracts under some of the national laboratories.

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1 We ha ve found th a t it that is very difficult to try and-1 2

track down the particulars on.

3 I would anticipate that we could file'our 4

final report on this by the beginning of next week.

5 JUDGE BRENNER:

That would be acceptable.

It

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6 would be helpful if we could receive it first thing 7

Monday morning so that the Board can confer and deal 8

with it on Monday.

9 MR. RAWSON:

Judge, we will make every 10 attempt.

And if we are going to have a problem with 11 that, I will let you know by telephone on Friday.

12 JUDGE BRENNER All righ t.

We won't require 13 it before Tuesday up here, but we would appreciate it 14 first thing Mondiy morning in the offices.

And you 15 don't have to let us know.

If'we don't have it, we 16 won 't have it.

17 I do have a few concerns regarding the 1

l 18 direction the staff has taken in their response.

LILCO,'

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The staff a little more graphically.

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20 Although the staff recogr.17.@s that our inquiry was not 1

21 limited to just an out.*ar -oct legal conflict of t

22 interest; that is, s '. e t e, ' 5AI had worked on *Shoreham l

23 for both parties, starting at the bottom of"page 2 and N

24 continuing over to page 3 of the staff's response there 25 is the assertion "At this time and subject to the q

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staff's further review..." that SAI played no role s

2 dire'ct or indirect in the staff's analysis of the 3

Shoreham application a nd certainly was not involved in 4

the preparation of the staff's testimony for this S.

proceeding.

6 Obviously, we expect a further response not to 7

be limited just to that aspect.

We would have been very 8

surprised had we found out differently on those points.

9 However, the key point is not these long lists of 10 contracts, which I suspect is the thing taking you the 11 most time to gather up.

~But esther, "We haved work on f2 the same subject for both parties; that is, systems 13 interactions in nuclear power plants," and that is what 14 we had hoped to hear more about in this filing, and that 15 is what we want to hear about in the next f ilin g *.

16 That is the salient point.

We are not 17 troubled by the f act that you have an organization that 18 may be working on contracts for the staff and utilities 19 on unrelated matters.

But here, there is a preliminary 20 indication that the work is on the same type of matter, 21 and the fact that it is not Shoreham per se does not 22 necessarily remove the problem.

23 Particularly coupled with the ass'ertions in 24 the testimony that the PRA is fine because it is similar 25 to other PRAs in the industry, and it turns out that S'AI ALDERSoN REPORTING COMPANY.lNC, s

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1 has had their fingers in all of the PPAs, in one form or l

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another, or many of them.

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The staff also does not directly address the l

4 point as to whether we should have been informed.

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5 vill not beat a dead horse, but I will just note that 6

the staf f does not address that, other than obliquely.

7 MR. RAWSON.

Judge Brenner, we intend to l

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add ress tha t a t grea ter length.

As you will see at the i

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bottom of page 3 end 4,

we presented some preliminary t

10 thinking on that subject.. But naturally, we vill have 11 more to say after we have all of the facts completely.

12 I would like to point out that in our response 13 on page 4 there is some discussion of the f act tha t 14 SAI's involvement with the staff's interaction program 15 has been both generic and very preliminary, and that the 16 reports are ongoing.

And the staf f 's decisions as to 17 what it will be doing with the information provided by 18 SAI, among others,.has not yet been made.

And for that 19 reason, we are an additional step removed, we believe, 20 on the basis of presen t kno wledg e, from a possibly 21 conflicting situation.

But we vill be pursuino that

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22 further and letting the Boa rd know.

l 23 JUDGE BRENNER:

Well, I will reit'erate that if 24 the work was generic, that does not necessarily remove 25 the problam when you are talking about the same area ve ALDERSoN REPORTING COMPANY, INC, a m smer urn att tW WASH!NGTON O C ?nt'?1 fr% hms

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are focusinc on here.

And secondly, it has not been 2

limited to generi: vork.

They have done wo rk 3

particularly on Indian Point.

4 In terms of notifying Board, since the staf f 5'

is the one link, other than two members of this Board, 6

between this procee' ding and Limerick, we would 7

sppreciate -- in fact, we vill request -- that the a

staff, presumably through staff's counsel in Limerick, 9

ve would appreciate it, Mr. Rawson, if you could pass 10 this ons that you would serve the papers from Shoreham 11 along wi th the pe r tine nt transcript excerpts when those 12 would be, too.

Those vould be 542828 and the other l

13 would be the brief dialogue I had with Mr. Ellis at.

1 14 approximately 5420222 and the written filings.

15 It might be convenieht to wait f or the staff's 16 further filing and

• hen file the whole thing, pe rha ps 17 along with this transcript or some cover letter 18 indicating that it was our request that it be served in l

19 Limerick in the interest of full disclosure for the 20 information of the parties to that proceeding.

21 MR. R AWSON :

That is no problem, Judge 22 Brenner.

Of course, staff counsel in the limerick 23 proceeding has been involved in this investigation, and l

24 ve vill see that those matters are all served on all of l

25 the parties in Limerick.

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1 ALCERSON REPORTING COMPANY,INC,

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JUDGE BRE!!NER:

Thank you, we appreciate 2

that.

I will leave it to the staff as to what it wants 3

to do with respect to Indian Point and any other 4

proceedings that might be involved.

5 Also, with respect to the same subject, there 6

is a general admittedly preliminary discussion of the 7

staff's contract review procedures being designed to a

look at possible conflicts and the fact that contractors 9

are required to update information and so on.

It would 10 be helpful in that context if the further report 11 disclosed whether or not staff's review was aware of 12 S AI's cola f or LILCO and also f or Philadelphia Electric 13 with respect to their respective applications, in terms 14 of their review.

And if there are any written findings l

15 or summaries of that Teview, we would appreciate knowing 16 that.

17 MR. RAWSON:

I will investigate that as well, 18 Judge Brenner.

19 JUDGE BRENNER:

Changing subjects now, unless l

20 somebody else has a comment on the previous subject, we at least I have seen nothing from Suffolk 21

received, 22 County with respect to a need f or any f urther inquiry of 23 Dr. Lucks, so I assume there is no such need.

24 MR. LANPHEB:

I sent you a letter last week to 25 that effect, Judge Brenner.

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1 A FT ER N OON EESSION 2

(12:50 p.m.)

3 JUDGE BRENNER:

Ba'dk on th e.reco rd.

4 The Staff is going to call its witness panel C

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on this Contention.

1 1 h

6 MR. REIS:

Mr. Chairman, before we get to 57 7

that, there is one other matter I hesitate to bring up, 8

but it doed have to be brought up.

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I was in contact with the office during i s to lunchtime today concerning the memorandum you asked for 11 on conflict of interest and the situation which might 12 create the impression of impropriety from a conflict 13 between review and preparation of application.

14 The Operations and Administrative Division of 10 15 the Office of Executive Legal Director of the NRC is t-

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18 the beginning and finds that a proper analysis of the t

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19 law, the regulations, the contracts that do exist and 20 we ha ve to face them in a factual situation that does

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21 exist -- a n d just what is involved in each of those j,. g.

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22 contracts will require substantially more time thgn we

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23 indicated to the Board before.

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24 Mr. Regan, who is division chairman or I

25 division chief of that division, and Mr. Hurray, deputy

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1 executive legal director, estimate that they would t

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that that ma tter could not be comple te before July 23.

3 And we are prepared to submit it to the Board at th a t

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time.

Prior to tha t time, we cannot have a complete 4

4 5

product.

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6 (The Board conferred.)

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JUDGE BRENNER:

Well, we certainly wan t the q

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job done right, and that is the thrust of your comment.

9 9

Depending on what we do, this could put the schedule for 10 the proceeding in a terrible bind, however.

h*

11 MR. REIS:

I realize that, Your Honor.

I 12 think we ought to go ahead and accept things and i

13 recognize that that migh t have substantial effect, and p

14 it might require the calling of witnesses or wha t have l

15 you.

That is what I have been informed, and I can see 1

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16 where looking at this sort of thing could take that 6

17 time.

I do not think that the request is unreasonable, f

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• 1 18 considering wha t is involved in those regulations.

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.' l 19 JUDGE BRENNER:

All right.

It occurs to me

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20 tha t in suggesting tha t date you had in mind some of our 21 comments.

I do not remember if it was at the meeting of 22 counsel or on the record or both that we ha ve tha t brea k e

li-23 coming up and we wa n ted to be able to begin focusing on

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And you have probably picked the t) 25 last date.

And it is still getting tigh t.

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Your inference is wrong.

The date N

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2 was applied by the home office to me.

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By the way, I did not mean 42 g

4 that there would be an unfavorable inference even if it h

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trade-off perhaps.

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All right,

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we vill have to live with that, and i{

8 the schedule for the proceeding vill have to live with

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9 that.

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way to get some advance indica tion I

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-- not right now but in advance of the 23rd e -- as to 1

1,0 11 the thrust of what the Staff view will be, particularly

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12 if it could upset the applecart, so to speak, that is i

y 13 going to be, obviously, very helpful.

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Right now I ha ve no indica tion tha t i

I 15 it upsets the applecart.

There are l '

conclusions given in

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t. *t 16 memorandum or as a preliminary matter that would be i '

,'i 17 changed.

It is just the Board raised this matter, and 4

18 ve felt we should put it to rest one way or the other.

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19 And we feel it will take that length of time to do it.

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. 20 We will also we could u nd e r ta k e to give the 21 Board a progress report around the 15th of July -- well, i

22 le t 's see, today is the 9th.

The 15th is a little too 23 close.

Let us say towards the end, at the end of next i"

f

) Y3 24 week, which is the 15th.

Let us make it the following f]

25 Monday or ruesday.

We will give a progress report.

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That would be helpful.

Since 2

you are taking additional time, I certainly hope that --

3 ve attempted to make some comments the other day that 4

would help focus our interest, and I assume that is 5

going to be taken into account in addition.

I 6

One thing we were considering is that 5

k, 7

regardless of what the Board for itself decided in the 8

context of this particular case, and that is the only

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9 thing we were going to focus on, we were thinking of i

10 some way of apprising whatever cognizant offices there h,

11 would be, whether it would be the Commission itself or

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12 the Office of General Counsel or some other body, that

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13 from an administrative poin t of view we would be 14 interested in focusing on this for its possible 1

i ek-15 implication in other proceedings.

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16 MR. REIS.

I agree, Your Honor, that would be c.j 11 17 very appropriate.

But let us see what the effect of

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18 this examina tion is.

We certainly have already brought

.jij 19 in and are consulting with the trial attorneys at least IIU 20 in other proceedings which have been mentioned in the 21 past and are looking at this from a larger scope than 6

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We are looking at it in

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filed, there is processes by which we screen these 2

matters and look at them.

Now, to the extent that this I

3 turns out'not to be sufficient, we will certainly go l'

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should be involved in that if that is so, if there is a 8

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JUDGE BRENNER:

Well, all I was going to

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I do not know if it is the OGC.

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16 MR. REIS:

I am not sure myself, Yo.ur Honor.

.C 17 But we will look into that. l2 lt 18 JUDGE BRENNER: Either Mr. Remick's office -- 19 I forget the name of it now. Pt 20 MR. REIS: Policy Evaluation. k 21 JUDGE BRENNER: Or OGC or both, in the sense n.. h, 22 that they know of the inquiry and perhaps could be e 23 supplied copies of what we have been given so far and 9 - [.[ 24 the contemporaneous copy of what the Staff is going to ) kf 25 supply when it supplies it to the parties, just so if we g T gi-w. l$' !P ALDERSON REPORTING COMPANY,INC, 3? 400 VIRGINIA AVE., S.W., WASHINGTON. D C. 20024 (202) $54 2345

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\\ t 6345 1 do refer something to them - and I do not know that we 2 vill -- it will not be the first time they have heard 3 sbout it. 4 The reason I suggested it now is I thought we 5 would be focusing on this a lot sooner. Now that we are 4 L 6 going to be delayed, maybe we could save some time later I 7 perhaps. 9 10 11 12 t' i' 13 I. ! 14 L 15 l 16 i 17 18 'l l; 19 20 21 t: 22 ( 23 t )p [ 24 y e.- 25 !-M g ,r ri 5 w l ee E-ALDERSON REPORTING COMPANY, INC, 400 vlRGINIA AVE., S W., WASHING TON. D C. 20024 (202) 554 2345 A

~ r-e 6346 ) 1 MR. REIS: Well, as you probably recognize, 2 Your Honor, this is a continuing problem within the 3 Commission, with the limited amount of specialized 3 4 contractors in certain areas, and this has -- is and has 5 been looked at by the Commission, and of course in the 6 past contractors have reviewed applications and 7 testified on comple tely different applications. 8 It is nothing new from that point of view, but { 9 ve vill look at it further and see what the story is and l P 10 make sure that there is nothing that could leave any 11 doubt to the Staff's independence in this regard. 12 JUDGE BRENNER: All right. We vill look 13 forward to the progress report, and also a very thorough 14 analysis of the question. 15 MR. RAWSON: Judge Brenner, at this time the 16 Staff calls as its witnesses on contention 7.B and SOC 17 contention 19.B Demos P. Spels, Walter P. Haas, Narvin 18 W. Hodges, C.E. Rossi, James H. Conran, Senior, and 19 Robert Kirkwood. 20 JUDGE BRENNER: I guess other than Nr. Hodges 21 and Mr. Kirkwood, the witnesses have not been sworn. 22 MR. RAWSON: Tha t 's righ t, Your Honor. 23 JUDGE BRENNER: If the rest of you would 24 rise. 25 Whereupon, ALDERSoN REPORTING COMPANY,INC, 400 VIRGINfA AVE., S.W., WASHINGTON, D C. 20024 (202) 554-2345 N

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T-7427 I 1 MR. LANPHER4 Judge Brenner, I ha ve two very 2 brief preliminary matters. I 3 NR, REIS4 The Staff also has two very brief g 4 preliminary matters. 5 JUDGE BRENNERa They cannot wait for beyond 6 today? I want to get this testimony done today. 7 MR. REISa One is the interim report that you 8 asked on SAI, and I wanted to give you that. I do not 9 think it would take more more than a minute or two. 10 JUDGE BRENNERa All right, let us take that, 11 and then va vill go back to Mr. Lanpher for his 12 matters. I 13 HR. REIS In our further review of the SAI I 14 satter and the possible conflict, we find that there may 15 be a conflict from a contracting point of view, but it 16 probably does not affect the testimony, mainly because 1 17 the Staff has not accepted SAI's position. 18 SAI had substantial input on generic issues l 19 into systets interaction, and SAI also did the PRAs at 20 Shoreham and Limerick. There is, as you know, a 21 continual debate on how to do systems interaction. As 22 you can see from the testimony that has come out so f ar, 23 ve have not accepted SAI's counsel to us on how to do s 24 systems interaction. 25 We generally view the conflicts that may exist ALDERSON REPORTING COMPANY. INC.

7428 f,j-E.E %;v ?i 1 from a contracting point of view not germane to this f we will get you the memorandum you 2 proceeding.

However,

$ y~ 3 requested by Friisy as the date set. I just wanted to a d 4 give you tha t interim report. j ?4 Further, NUS, who I believe Joksimovich worked 5 Ib f or, Dr. Jaksimovich, has also worked on the safety $1 6 f 7 goals and PRA generally for the Staff. And Sol levine, 'UI 8 of NUS, has, in addition, worked on the safety goals. J $4 So there are some problems there. 8 9 4 Further, in inquiring into this matter and 'S 10 ) 11 going into it, we also find that there is a Mr. Budnitz, 6 'H the Staff, 12 who apparently has worked for the County and I 13 although on different matters. I think he is a i on emergency planning, and he g 14 consultant to the County r; 15 has worked for the Staff on safety goals. That is the interim report. The other matter 16 I am is Judge Jordan asked some questions on aux feed. 17 9* 18 informed there is a memorandum going to all boards from =, 19 Mr. Denton, dated July 1, 1982, on NRC Staff release, 20 reliance on bleed-and-feed, which is relevant to Judge ~ week. Jordan's questions of last U 21 JUDGE BRENNERa All.right. But that,was not 22 a 23 the thrust of his questions. As you know, the g y lg w would only apply directly,to pressurized 1} bleed-and-feed 24 And he was asking his questions in 25 water reactors. i* ? ) ALDERSON REPORTING COMPANY. INC. h W@HINGTON. o.C. 20024 (202) 554 2345 a

t 7429 w 1 terms of getting a handle on the approach to !j I! 2 classification and the possible effect of some methods .t . l) i 3 other than the traditional methods which may or may not i 4 have been used in that decision; tha t is, some possible b. 1 5 probabilistic approach. .t l)- 6 So I appreciate your mentioning it, and I 7 guess if you provide us a copy of the memo, we vill make j e II 8 sure Judge Jordan sees it. Incid entally, he vill be

l 9

here shortly todsy. So we appreciste knowing that, but f l alN 10 it does not sound like the thrust of where he was going, c l ? or some of us who are familiar with feed-and-bleed, and g 11 12 that is not directly where he was going. In terms of di i t' I 13 your interim report, thank you. E 14 When you indicate your conclusion and the 15 support thereof in the memo that you do not think that h ~9 16 presents a conflict problem for this proceeding, we v N 17 would be interested in knowing whether that is your 18 conclusion as to s11 proceedings and whether it is just 19 this proceeding. We are not interested in your detailed 20 findings as to any other proceedings, but just in that distinction, whether the finding is limited to this g 21 22 proceeding or whether, therefore, in other prot.eedings Id 23 there might be a different finding. But we are not i interested in the details of what those might be. p 24 7 HR. BEIS I know we are working with the

l 25 1

a,, l i i l ALDERSON REPORTING COMPANY,INC, N m e a@ & 2 280 h (

7430 3, I 1 attorneys at Indisn Point and Limerick, and I know the 9 1 a similar memorandum vill be

L matter will be served, 2

by the Staff. So I h5 in the Liierick proceeding 3

served, while I am here is going 4

presume what is being prepared to cover that situation. 5 JUDGE BRENNER: All right. If it is going to a 6 on the Staff's reliance or lack of 1 7 turn, in part, about quite a different reliance, you are talking I 8 approach than what was envisioned in the initial 9 the support as to why the And I expect 10 response. or not support would serve to relieve details of support 11 what otherwise might have been a conflict situation. 12 13 And we vill be looking forward to seeing that. g Mr. Chairman, as we vent into this, MR. REISs 14 15 ve did not expect -- we were, frankly, surprised by the 16 results. l Judge Brenner, just briefly, the MR. LANPRER: 17 the schedule as we look 18 parties have been discussing ahead and for witness schedules and some other matters.- 19 in the order tha t we' think things We do have a change 20 I just wanted to pass that should be taken up in, and 21 you could consider at today 1 to the Board so that 22 along since it is a short week, probably. 23 or tomorrow, leaving aside i Leaving aside the -- well, 24 28A(1), 31, 26. 25 l 1 4' ALDERSoN REPORTING COMPANY,INC, 7@No D.C. 20024 (202) 554 2345 - -1

6 ag ' l (O)~~% 9' LILCO, July 1, 1982 UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION Before the Atomic Safety and Licensing Board In the Matter of ) ) lot lG ISLAND LIGHTING COMPANY ) Docket No. 50-322 (OL) ) (Shoreham Nuclear Power Station,) Unit 1) ) LILCO'S RESPONSE TO THE BOARD'S REQUEST FOR INFORMATION CONCERNING SCIENCE APPLICATIONS, INC. On June 24, 1982, the Board requested that the parties, the NRC Staf f and LILCO in particular, provide information regarding work that Science Applications, Inc. (S'AI) is doing under contract for the NRC Staff. SAI is LILCO's PRA consult-ant and an SAI employee, Dr. Edward T. Burns, is a witness in - this proceeding. The following information is provided in l response to the Board's request. SAI, like many consultants in the nuclear industry, has performed work for the NRC Staff in a wide range of areas. A listing of SAI's NRC contracts over the past few years is attached. The list does not include contracts with national laboratories since there is no easy way for SAI to distinguish g)f5 8-3-02 [ l J~fupe >

I j k whether the funds for a contract come from the NRC or the Depaltment of Energy. SAI has, however, provided information on the contract of interest to this Board -- SAI's work for Lawrence Livermore Laboratory on systems interaction. This work was performed by SAI's Energy Technology & Engineering (ET&E) Group's Accident Consequence Division.1/ SAI, under contract with Lawrence Livermore Laboratory, sur-veyed available systems interaction methodologies and assessed the current state of the art. The purpose of the study was to aid in the development of a methodology for systems interaction studies. SAI's principal involvement was through one of its employees, a member of the WASH-1400 Reactor Safety Study and a recognized expert in the field. The work for Lawrence Livermore Laboratory resulted in the publication of NUREG/CR-1859, " Systems Interaction: State-of-the-Art Review.*?l 1/ The ET&E Group within SAI is diverse both in its geography l and expertise. The Group's management structure reflects this j diversity. The Accident Consequence Division is located in j Palo Alto and is part of the Physics & Safety Operation of the ET&E Group. The work for LILCO was performed by ET&E's Power Engineering Services Division located until very recently in San Jose. The Power Engineering Services Division is part of the Engineering Analyses Operation of the ET&E Group. These divisions report to separate Operations Managers. The work performed for Lawrence Livermore Laboratory was done without knowledge of the performance requirements for LILCO and vice versa. There was no exchange of technical information between the organizations on their respective studies. 2/ Three other national laboratories also published reports on systems interaction for the NRC. The reports represent (Footnote Continued)

i h. k. As an outgrowth of this systems interaction work for Lawr'ence Livermore Laboratory SAI prepared for and participated in one review meeting of the Indian Point Systems Interaction Study (being conducted by PASNY and EBASCO). SAI's role was as an expert reviewer to provide comments on the study to the NRC through Lawrence Livermore Laboratory. The contract between Lawrence Livermore Laboratory and SAI has been inactive since December 1981 because of lack of f und ing. No future SAI participation in the Indian Point Systems Interaction Study is' anticipated. SAI has summarized its position on the present matter as follows: SAI is a company of approximately 3500 employees distributed in 50 offices throughout the country. SAI clients include private industry, the Defense Department, the NRC and National Laboratories. SAI has provided consulting services to the NRC and to utilities SAI does employ as members of its staff experts in ~ the field or probabilistic risk assessment; because of the limited number of such experts available, these people may consult at different times with both NRC and private industry On the subject of systems interaction, the NRC has performed at least four studies in an attempt to i define a methodology l t SAI participated as a contributor to one of these studies i (Footnote Continued) diverse viewpoints from which the NRC presumably will mold its systems interaction policy. i

i

• N SAI has also participated as a reviewer and adviser to the NRC on the PASNY/Ebasco systems interaction pilot program at Indian Point SAI is no longer an active consu'ltant to Lawrence Livermore Laboratory on systems interaction No member of the SAI staff participated in both the Lawrence Livermore Laboratory sponsored review of Indian Point and the Shoreham PRA As to LILCO's involvement with SAI, contact was first made with the Power Engineering Services Division in late 1979 or early 1980.

SAI provided LILCO with information on PRA's in general and SAI's capabilities in particular throughout 1980. During this period LILCO also discussed PRAs with other potential contractors. Formal competitive bids for the Shoreham PRA were submitted to LILCO in February 1981, and SAI was awarded the contract for phases I and II of the PRA in j April 1981.3/ Counsel for LILCO has been aware of SAI's role in the Sholeham PRA as well as SAI's participation in the Limerick PRA. Counsel was also aware that SAI is a widely known expert in the PRA field and has done PRA work for other utilities. Counsel did not know of SAI's involvement in the Indian Point Systems Interaction Study. LILCO sees no conflict of interest in SAI's performance of work for utilities, LILCO in particular, on the one hand, 3/ For the Board's information, LILCO's other PRA expert wit-ness, Dr. Voj in Joksimovich, is employed by the NUS Corporation. NUS has also done work for the NRC Staff. In the i PRA area, that' work has consisted of conducting seminars on PRA methodology for NRC Staf f personnel.

t and the NRC Staff on the other. In the systems interaction a r e a4, SAI's work for the Lawrence Livermore Laboratory (under contract with the NRC Staff) was an assessment of the state of the art in systems interaction methodology done by a recognized expert in the field. It is appropriate for the NRC Staff or its contractor to seek the expert views of one of the handful of pre-eminent organizations in the field. SAI's Indian Point work appears to have been merely an extension of this state of the art review. In sum, the only bearing of SAI's prior systems inter-action work on this proceeding concerns not conflict of inter-est but whether Dr. Burns ' testimony is consistent with the pertinent views of other SAI experts. Although LILCO does not believe any inconsistencies exist, the parties and the Board can certainly explore the area if they so desire. l Respectfully submitted, l f LONG ISLAND LIGHTING COMPANY l./. F /.tj k, w'-{y J S W. Taylor Reveley, III, III (( l Donald P. Irwin Anthony F. Earley, Jr. Hunton & Williams P. O. Box 1535 Richmond, Virginia 23212 l DATED: July 1, 1982 l

LILCO, July 1, 1982 \\. CERTIFICATE OF SERVICE In the Matter of LONG ISLAND LIGHTING COMPANY (Shoreham Nuclear Power Station, Unit 1) Docket No. 50-322 (OL) I hereby certify that copies of LILCO'S RESPONSE TO THE BOARD'S REQUEST FOR INFORMATION CONCERNING SCIENCE APPLICATIONS, INC., were served upon the following by first-class mail, postage prepaid, or by hand (as indicated by an asterisk), on July 1, 1982. Lawrence Brenner, Esq.* Atomic Safety and~ Licensing Administ r at ive Judge Appeal Board Panel Atomic Safety and Licensing U.S. Nuclear Regulatory Board Panel Commission U.S. Nuclear Regulatory Washington, D.C. 20555 Commission i Washington, D.C. 20555 Atomic Safety and Licensing Board Panel l Dr. Peter A. Morris

• U.S. Nuclear Regulatory Administrative Judge Commission Atomic Safety and Licensing Washington, D.C.

. 20555 Board Panel t U.S. Nuclear Regulatory Bernard M. Bordenick, Esq.* l Commission David A. Repka, Esq. Washington, D.C. 20555 U.S. Nuclear Regulatory Commission Dr. James H. Carpenter

• Washington, D.C.

20555 Administrative Judge Atomic Safety and Licensing David J. Gilmartin, Esq. Board Panel Attn: Patricia A. Dempsey, Esq. U.S. Nuclear Regulatory County Attorney Commission Suffolk County Department of Law Washington, D.C. 20555 Veterans Memorial Highway Hauppauge, New York 11787 l I

, L Secretary of the Commission Stephen B. Latham, Esq. U.S. Nuclear Regulatory Twomey, Latham & Shea Commission 33 West Second Street Washington, D.C. 20555 P. O. Box 398 Riverhead, New York 11901 Herbert H. Brown, Esq.* Ralph Shapiro, Esq. Lawrence Coe Lanpher, Esq. Cammer and Shapiro, P.C. Karla J. Letsche, Esq. 9 East 40th Street Kirkpatrick, Lockhart, Hill, New York, New York 11901 Christopher & Phillips Albany, New York 12223 j 8th Floor l 1900 M Street, N.W. Howard L. Blau, Esq. Washington, D.C. 20036 217 Newbridge Road Hicksville, New York 11801 Mr. Mark W. Goldsmith Energy Research Group Matthew J. Kelly, Esq. 400-1 Totten Pond Road State of New York Waltham, Massachusetts 02154 Department of Public Service Three Empire State Plaza MHB Technical Associates Albany, New York 12223 1723 Hamilton Avenue Suite K Mr. Jay Dunkleberger San Jose, California 95125 New York State Energy Office Agency Building 2 Empire State Plaza Albany, New York 12223 Respectfully submitted, LONG ISLAND LIGHTING COMPANY (> l' ...Q i

• h' W. Taylor Reveley, III Donald P.

Irwin Anthony F. Earley, Jr. Hunton & Williams 707 East Main Street P.O. Box 1535 Richmond, Virginia 23212 DATED: July 1, 1982

4 UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION ? BEFORE THE ATOMIC SAFETY AND LICENSING BOARD In the flatter of Docket No. 50-322 0.L. LONG ISLAND LIGHTING COMPANY (Shoreham Nuclear Power Station, ) Unit 1) ) NRC STAFF INTERIM REPORT ON INVOLVEMENT OF SAI AND NUS AS CONTRACTORS FOR THE STAFF On June 24, 1982, the Atomic Safety and Licensing Board raised a concern on the record (Tr. 5348-52) about the possibility that a conflict of interest existed because Applicant's contractor for its Shoreham probabilistic risk assessment, Science Applications, Inc. (SAI), has also served as a subcontractor for the NRC Staff on certain The Board requested aspects of the Staff's systems interaction program. a report from the Staff as to whether SAI's involveme'n't in these matters creates a conflict of interest or a situation where there might not be f 1., complete separation between the preparation of an application and the Staff review of that application. The Board further requested a report as to why facts material to these matters were not disclosed to the Board.- The Staff's interim report on these questions, based on matters orally related to Staff counsel, is set forth below. Further investigation I and analysis is continuing and a final report will be made to the Board when that process is completed. Because the Board may have similar I cot.cerns about NUS, the Staff has also initiated a review of its g5 $5'U2 .e oL t,oJ g g

o involvementincontractswithNUS.E SAI is a large firm specializing in technology research and regulatory matters. The Staff has used SAI as a contractor for many projects in.the past and has many current contracts with SAI. A list of all past and present NRC comercial contracts with SAI is attached. Three specific aspects of the relationship between the Staff and SAI may be of particular interest to the Board. First, SAI has acted as a subcontractor (under Lawrence Livermore Laboratory) for two generic reports to the Staff on methodologies for analyzing systems interactions in nuclear power plants. Second, SAI has acted as a subcontractor (again under Lawrence Livermore Laboratory) assisting the Staff in its analysis of the systems interaction study done by PASNY for Indian Point Unit 3. Third, SAI has a contract with the Division of Licensing, NRR, to supply services to the Staff in connection with licer. sing issues. Ta'sks performed under this contract relate to NMSS rather than NRR and bear no relation to Shoreham. The Staff is obtaining the details of these contracts and will provide further information to the Board. At this time, however, it appears that none of these contracts, including the three highlighted above, have any relationship tn the Staff's review of Shoreham or the Staff's testimony in the Shoreham proceeding. SAI appears to have -1/ A complete investigation of the Staff's contractual relationships with SAI and NUS is a lengthy and complex undertaking. In addition, certain of the Staff members involved in this investigation are also involved in prepar'.ng testimony for this proceeding. A final report on these matters will.be submitted as soon as possible.

.t played no role, direct or indirect, in the Staff's analysis of the Shoreham application and certainly was not involved in the preparation of the Staff,'s testimony for this proceeding. The Staff's contractor review process is designed to avoid any possibility that a conflict will be created by Staff contracts. Prior l to the awarding of a contract, the Staff reviews the nature of work being done by the prospective contractor for industry members or other organizations which may have some contact with the Staff on the matters involved in the contract. This review is comprised of a formal analysis of the prospective contractor's work supplemented by any available input from cognizant Staff members regarding the prospective contractor's other activities. This review process does not end with the awarding of the contract. Contractors are obligated to infonn the Staff of subsequently-acquired work which may involve issues relating to the contractor's l work for the Staff. If a conflict of interest appears, a contract is not awarded; if the conflict arises during the term of the. contract, appropriate remedial actions are taken. Parties to NRC adjudicatory proceedings, including the Staff, have an obligation to bring to the attention of adjudicatory bodies information that is relevant and material to the matters being adjudicated. See generally Tennessee Valley Authority (Browns Ferry Nuclear Plant, Units 1, 2 & 3), ALAB-677, 15 NRC (1982); Duke Power Co. (William B. McGuire Nuclear Station, Units 1 and ?), ALAB-143, 6 AEC 623, 625 (1973). On the basis of the facts as presently known, the Staff believes that the involvement of SAI as a contractor for LILCO on the Shoreham PRA and as a subcontractor for the Staff on certain systems interaction matters does l not create a situation of conflict of interest or of a situation of less l l

~, .. s I i. than complete separation between application preparation and Staff review 1 'I of that application, nor does it appear to be,infomation material to the I matters being adjudicated here ~ LILCO's contractors in this proceeding have discussed PRA generally ~ and the Shoreham PRA and have taken the position that probablistic risk assessment techniques provide the best way of resolving systems interaction problems. The Staff has offered no testimony on the specific subject of PRA or the Shoreham PRA. SAI has been involved in analyzing systems interaction techniques generically for the Staff. However, the positions taken by SAI in that analysis have not been adopted by the Staff and are not reflected in the Staff's testimony in this proceeding. The Staff is continuing to investigate and analyze the facts concerning its relationship with SAI and NUS regarding the issues of PRA 1 and systems interaction. Respectfully submitted, s Richard J. Rawson Counsel for tiRC Staff l ~ Dated at Bethesda, Maryland this 1st day of July, 1982 ( 4 l 2/ The Staff draws the same conclusions with respect to SAI's involvement for the applicant in the Limerick proceeding. i s

x .o ,t n e CONTRACTS WITH SCIENCE APPt.! CATIONS. INC. e Contract Number Title ATk49-24)-00B7 Assistance in Study on GESMO AT(49-24)-0119 Consulting Assistance for GESMO AT(49-24)-01'21 f' Quantitative Evaluation of Safeguard - c, y Systems Component Test and Maintenance s Allowed Outage Times AT(49-24)-0294 Analysis of Guides and Regulations With Material Control Performance Criteria AT(49-24)-0332 Study to Develop Intergrated Systems Concepts for Safeguards AT(49-24)-0388 Security from Internal Threat NRC-02-77-023 Technical Assistance in Revising the Draft Safeguards Supplement to GESMO NRC-03-77-059 A Quantitative Approach to Establish ~ LCO for ECCS Outage NRC-02-77-661 Security Force Collusion x s NRC-02-77-185 Analysis of Small-Group Encounter Experiente HRC-02-77-200-03 Support of the De' cision on Mixed Oxide Fuel (MOX) i l> NRC-02-77-201-02 (BOA) Regulatory Framework for Nuclear Waste 1 Management NRC-02-78-026 Table S-3 Rulemaking - Expert Testimony St'udy of Consumer Products Containing NRC-02-78-045 Radioactive Material NRC-02-78-049 Analysis of Material Accounting Practices at a Specific Nuclear Facility 1 NRC-02-78'-073 Collusion in Nuclear Fuel Cycle Facility . Security Forces NRC-02-78-077 Material Control and Accounting Performance Rule Development t k w .1

-c- [., C0!iiRACTS 'W1Til SCIENCE' APPL.IC'ATIONS INC ~ " ~ Contract Number Title r NRC-03-78-161 Feasibil.ity of Balancing Light Water Reactor Safety Risks Against Occupational Radiation Exposure Risks HRC-04-78-199 - Scoping Study - Spent Fuel Transport - - Accidents NRC-17-78-468 Analysis of British Views on Making Proliferation Resistance Fuels for Breeder and Thennal Reactors NRC-02-79-028 Development of Improved Techniquei for Analyzing Material Control and Accounting l Data NRC-02-79-029 Licensing Assistance Tailings Management Program Technical' Evaluation NRC-02-79-032 Waste Management - Systems Analys,is of Shallow Land Burial NRC-02-79-035 Safeguards for High Level Waste Repositories NRC-02-79-043-01 Bulk Material Contrel NRC-02-79-044 Analysis of LEID Calculations at a i Specific Nucle,ar., Facility NRC-01-80-001 Study of the Parameters that Affect NDA Measurement Response and the Development of Design Specifications to Minimize Their Effect NRC-02-80-027-01 (BOA) LicensingAssistance/Environmentalimpact Statement Preparations l NRC-02-80-035 (BOA) Licensing Technical Assistance NRC-02-80-035-01 Licensing Technical Assistan:e/ License Renewal, Exxon Fuel Fabrication Plant. Richland, Washington ~' ~ NRC-02-80-035-02 Licensing Technical Assistance / Increase UF6 to UO2 Conversion Capacity - Combustion Engineering, Inc. Fuel Fabrication Plant, Hematite, Missouri 1 l

.a ~ CONTRACTS NITH SCIENCE APPLICATIONS. INC. ~ Contract Number Title NRC-02-80-035-03 Licensing Technical Assistance / Increase UF6 to U02 Conversion Capacity - General Electric Fabrication Plant Wilmington, North Carolina s NRC-02-80-035-04 Licensing Technical Assistance / Instal.1 Incinerator - General Electric Fuel Fabrication Plant, Wilmington, North Carolina NRC-02-80-035-05 Licensing Technical Assistance / Structural (Seismic) Analysis of Spent Fuel at West Valley, New York NRC-02-80-035-06 Licensing Technical Assistance / Environmental Assessment Relative to Operations of the Battelle Memorial Institute at West Jefferson, Ohio NRC-04-80-178 Fuel Cycle Project Review NRC-19-80-472 Alternative Processes for TMI-2 Kr-85 Removal NRC-02-81-040 In-Process Control of Special Nuclear Material (SNM) EnvironmentalAss3ssmentofRaffinateStudy NRC-02-81-045 Disposal at the Kerr-McGee Sequoyah Facility, i Gore, Oklahoma NRC-02-81-D50 Environmental Assessment of Low Level Waste Storage at TVA Browns Ferry Nuclear Plant in Limestone County, Georgia HRC-02-81-051 Seminar on SAI Systems Model NRC-02-81-053 Environmental Assessment for low Level Waste Storage at TVA Sequoyah Nuclear Plant NRC-02-81 054 Environmental Assessment Relative to the , Union Carbide Application for Renewal of License No. SfM-639 G

V O CONTRACTS WITH SCIENCE APP-LI. CATIONS; INC, t Contract Number Title 1 NRC-02-81-057 Environmental Assessment of Radioactive Waste Stabilization Project at the Amax Site, Wood County, West Virginia ~ NRC-02-81-058 Environmental Impact Assessment Relative to the General Electric Company Special Nuclear Material License No. SNM-1097 Renewal Action Environmental Impact Assessment Relative NRC-02-81-060 to the Combustion Engineering's (CE) Special Nuclear Material License No. SNM-33 Renewal Action NRC-02-81-064 Environmental Assessment of low-Level Waste Storage at Pennsylvania Power and Light Company - Susquehanna Steam Electric Station NRC-02-82-026-07 (BOA) Environmental Assessments and Impact Statements for Low-Level Waste Disposal Facilities NRC-03-82-096 f669dr Technical Assistance in Support of NRC Reactor Licensing Actions-Program III N e e e O e 9 m e o e M 9 e 9 e l e

e UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION 4 BEFORE THE ATOMIC SAFETY AND LICENSING BOARD ~ IntheMattehof LONG ISLAND LIGHTING COMPANY l Docket No. 50-322 h (OL) (Shoreham Nuclear Power Station, / Unit 1) J CERTIFICATE OF SERVICE Iherebycertifythatcopiesof"NRCSTAFFINTERIkREPORTONINVOLVEMENT OF SAI AND NUS AS CONTRACTORS FOR THE STAFF" in the above-captioned proceeding have been served on the following by deposit 1.n the United States mail, first class, or, as indicated by an asterisk, through deposit in the Nuclear Regulatory Comission's internal mail system, or, as indicated by double asterisks, by sxpress mail on the 2nd day of July, this 1st day of July, 1982: Lawrence Brenner, Esq.* Ralph Shapiro, Esq. Administrative Judge Camer and Shapiro Atomic Safety and Licensing Board 9 East 40th Street U.S. Nuclear Regulatory Comission New York, NY 10016 Washi'ngton, D.C. 20555 Dr. James L. Carpenter

• Administrative Judge Howard L. Blau, Esq.

Atomic Safety and Licensing Board 217 Newbridge Road U.S. Nuclear Regulatory Comission Hicksville, NY 11801 Washington, DC 20555 Dr. Peter A. Morris *

• • W. Taylor Reveley III, Esq.

I l Administrative Judge Hunton & Williams Atomic Safety and Licensing Board P.O. Box 1535 U.S. Nuclear Regulatory Comission Richmond, VA 23212 Washington, DC 20555 Matthew J. Kelly, Esq.

• • Dr. Walter H. Jordan Staff Counsel Administrative Judge New York Public Service Comission 881 W. Outer Drive i

3 Rockefeller Plaza Oak Ridge, TN 37830 1 Albany, NY 12223

o o 2- ~ Stephen B. Latham, Esq. John F. She'a,' III, Esq. Herbert H. Brown. Esq. Twomey, Latham & Shea Lawrence Coe Lanpher, Esq. Attorneys at Law Karla J. Letsche. Esq. P.O. Box 39B Kirkpatrick, Lockhart, Hill, 33 West Second Street Christopher & Phillips Riverhead, NY 11901 1900 M Street, N.W. 8th Floor Washington, D.C. 20036 Atomic Safety and Licensing Board Panel

• Docketing and Service Section*

U.S. Nuclear Regulatory Comission Office of the Secretary Washington, D.C. 20555 U.S. Nuclear Regulatory Comission Washington, D.C. 20555 Atomic Safety and Licensing Appeal Board Panel

• U.S. Nuclear Regulatory Comission Washington, DC 20555 f

0. f ic'hard J. Rdwso'Ti ~ Counsel for NRC Staff l \\ ~ r

8 ' COURTISY COPY LIST Mr. Jeff Smith Edward M. Barrett, Esq. Shoreham Nuclear Power Station General Counsel P.O. Box 618 Long Island Lighting Company North Country Road 250 Old County Road Wading River, NY 11792 Mineola, NY 11501

• • MHB Technical Associates Mr. Brian McCaffrey 1723 Hamilton Avenue Long Island Lighting Company Suite X 175 East Old Country Road San Jose, CA 95125 Hicksville, New York 11801 Hon. Peter Cohalan
  • Marc W. Goldsmith Suffolk County Executive Energy Research Group, Inc.

County Executive / Legislative Bldg 400-1 Totten Pond Road Veteran's Memorial Highway Waltham, MA 02154 Hauppauge NY 11788 David H. Gilmartin, Esq. Mr. Jay Dunkleberger Suffolk County Attorney New York State Energy Office County Executive / Legislative Bldg. Agency Building 2 Veteran's Memorial Highway Empire State Plaza Hauppiuge,NY 11788 Albany, New York 12223 l l l l 1 l 0

s 07/23/82 UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION BEFORE THE ATOMIC SAFETY AND LICENSING BOARD In the Matter of LO!1G ISLAllD LIGHTING COMPANY Docket No. 50-322 0.L. (Shoreham Nuclear Power Station, Unit 1) NRC STAFF FINAL REPORT ON INVOLVEMENT OF SAI AllD NUS AS CONTRACTORS FOR THE STAFF The following constitutes the Staff's response to the conflict of interest questions raised by the Board during the Shoreham proceeding. The Board (Tr. 5348-52) raised the question of whether a conflict of interest exists because Applicant's contractor for its Shoreham proba-bilistic risk assessment (PRA), Science Applications, Inc. (SAI), has also served as a subcontractor for the Staff on certain aspects of the Staff's systems interaction program. The Board requested a report es to whether SAI's involvement in these matters creates a conflict of interest or a situation where there might not be complete separation between the preparation of an application and the review of that application. This report will address the general legal framework employed by the NRC for dealing with organizational conflicts of interest and will analyze some of the specific contract work being done for NRC by SAI in the context of the conflicts of interest rules. The implications of this analysis will then be considered as it relates to the issues before the Board. We will canclude with some comments relative to the relationship between NUS (another contractor to the Applicant) and the Staff and some observations &}O0lS$ jag $ [05 g

• regarding the applicability of these considerations to the Limerick proceeding. See Tr. 5711.

The problem of organizational conflicts of interest has been a vital concern to the Government for many years.1I The NRC is among several agencies required by law to promulgate fonnal rules establishing policies and procedures to insure that organizational conflicts of interest are avoided.2/ The NRC receives contract assistance through two different mechanisms:

1) by commercial contracts issued through the Division of Contracts, and

2) by interagency task orders to the Department of Energy (DOE) issued by theprogramoffices.SI Task orders are actually perfonned by the contrac-tors operating the National Laboratories and by their subcontractors. The procedures utilized to avoid conflicts of interest in a coninercial con-text are administered by the Division of Contracts with assistance by the Office of the Executive Legal Director (ELD) and the program offices

-1/ Early studies of the subject include H.R. Rep. No. 1121, 86th Cong., 1st Sess (1959) and S. Doc. No. 94, 87th Cong., 2d Sess. (1962) (The " Bell Report"). -2/ NRC's present rule is found at 41 C.F.R. Part 20. (Attachment 1) This rule was promulgated under Section 170A of the Atomic Energy Act of 1954, as amended. -3/ A very small portion of outside assistance is acquired by agreements with agencies other than 00E. Although these actions are not formally covered by the regulations discussed here, they are subjected to the same type of analysis for conflicts of interest as are all other transactions. When NRC issues a work order to DOE, the DOE field office issues a task to its contractor under the master contract for operation of the national laboratory which is to perform the work.

as necessary. The procedures governing DOE work orders are part of Manual Chapter 1102 (Attachment 2, 1 1102-031(1), Exhibit 1, p. 5 and Exhibit 4, p. 4) and are administered by the program offices with assistance by ELD as needed. The policy considerations underlying both 41 C.F.R. Part 20 and Manual Chapter 1102 are identical; they differ only in the mechanics of implementation. The Contracting Officer solicits and evaluates the relevant information in the course of awarding and adminis-tering commercial contracts. In the case of DOE work orders, the DOE Contracting Officer does the inital review of the conflicts issue. If this review indicates a potential conflict of interest, the question is referredtotheNRCprogramofficeforresolution.SI The policy embodied in these rules is that contractors ought not to be placed in conflicting roles which might bias their judgment in rela-tiontotheirworkforNRC.EI If the contractor is placed in a situation where it is forced to reconcile competing interests, an actual conflict of interest exists, regardless of how those interests may, in fact, be ultimately reconciled. When the business activities of a prospective -4/ The program offices are very sensitive to this issue and often indicate relevant lines of inquiry to the DOE operations office at the time a work order is issued or during the course of its execution. -5/ The rule also addresses avoidance of unfair competitive advantage. This issue concerns fairness to the business community rather than the reliability of contract work products and thus will not be addressed in this report.

contractor indicate the potential for a conflict of interest,6_/ the NRC examines the relevant circumstances to see if they provide a realistic motivation for bias in performance of the contract work. If so, one of several paths may be followed: the prospective contractor may be excluded from competing for the contract; a waiver may be processed;U or other appropriate steps may be taken (such as modification of the proposed scope of work). The key to making the necessary judgment concerning the existence of a conflict of interest lies in a detailed analysis of all relevant facts to see if a realistic motivation for bias can be found. Motivations for bias which are remote or speculative are not a proper basis for action in this area.8/ Once a contract is awarded, contract clauses require the contractor to advise the NRC of any other work the contractor is considering which might present a conflict of interest. The contractor is prohibited from 6/ The term " potential conflict of interest" is used to signify those situations which merit investigation prior to contract award in order to ascertain whether award would give rise to an actual conflict or which must be reported to the contracting officer for investigation if they arise during contract performance. l -7/ The conflict of interest rule recognizes that the existence of a conflict does not necessarily foreclose a contract. Provisions are made in the rule for " waiving" the conflict when such action "is in the best interest of the United States". 41 C.F.R. 20-1.5411. These provisions are statutorily authorized by Section 170A of the Atomic Energy Act of 1954, as amended. A document analogous to a waiver is processed for DOE work orders when circumstances indicate such action is appropriate. 8/ Columbia Research Corp., B-185843, July 1, 1976, 76-2 CPD 1 2. (Attachment 3)

.S-undertaking such work until the NRC has examined the circumstances and decided either that no conflict exists or that a waiver is appropriate. The NRC may also bar the contractor from entering into other contracts if they would present a conflict of interest. The mere fact that a company may work both for the NRC and a utility is not, in itself, a conflict of interest. If a contractor provides aovice in the same technical area or on the same matter to the NRC and to an organization regulated by the NRC, the potential for conflict of interest becomes greater and the circumstances must be examined more closely. Even 11. this case, however, if the work being done for the regulated party does not bear any necessary technical relationship to the work requested by the NRC, a conflict of interest does not result. In such cases it is acceptable for a contractor to support a licensee or applicant in one proceeding before the NRC and to support the NRC in a different proceeding because there is no risk that the information sup-plied to the NRC might be biased. l l The above general principles are applied in all cases where the NRC l receives contract assistance. The following analysis treats the specific instance of SAI and its work relative to the issues in the Shoreham proceeding. Intervenors' Contention 7B alleges that neither the Applicant nor i the Staff has applied a systematic methodology in the safety classifica-tion of structures, systems and components and in the analysis of systems interactions. Intervenors cited particular methodologies including fault tree / event tree logic and stated that, absent such a methodological approach, compliance with the Commission's regulations i i l l

could not be shown. Pursuant to this contention there has been extended litigation on the subject of the PRA, which utilizes fault tree / event tree methodology, voluntarily undertaken for Shoreham and on its treat-ment of systems interaction issues. SAI has provided, or is in various stages of providing, contract support to the NRC on a number of matters related to systems inter-action. This support is usually in the role of a subcontractor to a national laboratory. SAI had input into NUREG/CR-1859, Systems Interaction: State-of-the-Art Review and Methods Evaluation as a sub-contractor to Lawrence Livemore Laboratories (LLL). The title of this report is self-explanatory. SAI has also been involved, again as a subcontractor to LLL, in the review of the Indian Point Unit 3 systems interaction study. This project has three phases: (1) to develop a recommended methodology for the study; (2) assist NRC with an audit and walk-through of the plant; and (3) develop a systems interaction audit plan for interconnected systems. Phase (1)hasbeencompleted. SAI recommended primary reliance be placed on PRA methods for the systems i interaction study. The Staff did not adopt SAI's recomendations under this phase.A/ Phases (2) and (3) have not been performed yet. SAI is . assisting in another project for the review of selected Light Water i l Reactors (LWR's) for systems interactions. This project consists of several tasks which include: assessment of general guidance for ~9/ See " Meeting Summary and Status Report For Meeting with PASNY/EBASCO on Proposed IP-3 Systems Interaction Program" (July 24,1981) attached to NRC Staff Testimony of Themis P. Speis, [et al.]... on Safety Classification and Analysis of Structures, Systems and Components, ff Tr. 6357.

-7 application to specific plants; guidance in applying the selected methods to two plants; documentation of matrix based diagraph procedures; b and demonstration of the selected method by having a contractor apply the method to a selected plant. The first phase of this project is completed, the others are yet to be done. In addition to the work done by SAI for the Staff on systems interactions, SAI has also performed services for the Staff regarding PRA's. As a subcontractor to Brookhaven National Laboratory (BNL), SAI is helping to write the National Reliability Evaluation Program (NREP) PRA procedures guide. SAI is serving as a subcontractor to Sandia for a detailed review of the Zion and Indian Point risk studies. Sandia is also considering using SAI to review a number of PRA's with a view toward extracting any possible generalizations. To date, SAI has not been formally retained for this effort. The Staff has also been considering using SAI to study partitioning of fault trees so as to identify systems interactions. This contract has not been consunnated as yet. Having examined the various undertakings by SAI, it is necessary to ask whether they give rise to a conflict of interest. In a very strict sense it could be said that SAI's PRA work for NRC licensees, such as s. the Applicants in Shoreham and Limerick, could place SAI in a position where it might be motivated to bias its advice to the NRC under the above l l -10/ This is a formal mathematical treatment which consists of trans-forming graphs of systems into matrices and then manipulating the matrices so as to discover properties of the system.

- contracts. SAI has taken the position in Shoreham that PRA is the pre-ferred methodology for purposes of systems interaction analyses.El Having taken this position on behalf of a licensee, SAI might be regarded as being motivated to provide the same advice to the Staff so as not to compromise the position it has taken for the licensee. In assessing how realistic these motives for bias actually are it should be noted that both within the NRC and within the industry there is a spectrum of views on the merits of PRA as a methodology for per-forming systems interactions analyses. It still seems, however, that SAI has an interest in not developing results which would adversely affect its existing PRA's. The primary question is what effect, if any, the SAI position that PRA methodology should be employed in conducting systems interactions analyses might have had on the Staff's position in the Shoreham proceeding. At the outset it should be noted that the Staff has not relied upon the Shoreham PRA as a basis for licensing. Nor has the Staff relied upon any input from SAI in formulating its position on the adequacy of the consid-eration of systems interaction in the Staff's present deterministic analyses. In fact, the Staff has specifically differed from 5AI's views on the relationship of PRA's and systems interaction and has brought this totheBoard'sattention.El Thus, regardless of whether there is a See generally, " Testimony of Edward T. Burns, [Toiitention 7B andet al.]... Regard -11/ ing Suffolk County /Shoreham Opponents Coalition Shoreham Opponents Coalition Contention 19B", ff. Tr. 4346, at 3. H/ See footnote 9, supra. l l

• motive for bias on the part of SAI, or even if there has been bias in fact in SAI's work for the NRC, it does not appear to be material to the issues in the Shoreham proceeding.

The issue in the context of a licensing hearing is to determine whether actual biased input has been presented to the Staff and, if so, whether the Staff has relied upon such input. As stated above, the Staff believes that its position in this proceeding has not been affected by any work done for it by SAI. The Staff agrees with ApplicantEl that such questions as might exist are properly a question of credibility to be resolved through examination of the SAI witnesses. In the Staff's view, there is no need for such an inquiry in the Shoreham proceeding. The Staff has also undertaken to review NUS' consultant activities for the Staff and for the Applicant in light of NUS' services to the Applicant as a peer reviewer of the Shoreham PRA. Based upon our review to date, we have identified only one contract that might be considered relevant and material to the PRA and systems interactions issues in Shoreham. That contract was for the conduct of workshops for the NRC Staff on WASH-1400, The Reactor Safety Study.El As the workshops ' -13/ See LILC0's Response to the Board's Request for Information Con-cerning Science Applications, Inc., July 1, 1982. l -14/ JBF Associates of Knoxville, Tennessee was also involved in the conduct of these workshops. Additionally, NUS providing " Expert Opinion on the Use of Probabilistic Risk Assessment (PRA) and Safety Goals" to the Office of Policy Evaluation, which serves in an advisory capacity to the Comission. If the Staff determines as a result of its further review that there are any other consultation services being performed for it by NUS in the areas of PRA or systems interaction which may be relevant and material to the Shoreham and Limerick proceedings, we will notify the Board and parties to those proceedings.

were conducted for the purpose of educating the Staff on PRA methodology and were not structured in such a way as to advocate the use of one type or another of specific analysis methods, the Staff does not perceive any motive NUS would have had to give the Staff biased advice in the workshops. In any event, the Staff has not offered testimony in this proceeding on the results of the Shoreham PRA and it does not, therefore, appear that NUS' views on PRA have been reflected in the Staff's position in the proceeding. The situation with regard to the Limerick proceeding is somewhat different than that examined above. There, the Staff requested the Applicant, Philadelphia Electric Company (PECo), to prepare a PRA. PECo has used SAI as a principal consultant in the preparation of the PRA. Unlike Shoreham, however, the Staff is conducting a review of the Limerick PRA and does expect to present the results of its review in evidence at the Limerick hearings. The Staff has arranged with Brookhaven National Laboratory (BNL) for the conduct of this review and BNL does not have a subcontract with SAI for any aspect of that review. There does not, therefore, appear to be an immediate conflict of interest or lack of separation between preparation of an application and the review thereof in the Limerick proceeding in the sense of SAI doing l work for both the Staff and PECo on PRA or systems interaction. The same relationships, however, which Staff believes may present a motive for bias on SAI's part in the Shoreham proceeding would also be relevant to the Limerick proceeding. As with Shoreham, Staff believes that any issue will be one of witness credibility, which can be explored through voir dire and cross examination at the Limerick hearings. l

' NUS is also providing services to PEco as a peer reviewer of the Limerick PRA, but is not assisting BNL or the Staff in reviewing the Limerick PRA. We have addressed above the consulting activities which NUS has conducted for the Staff in the areas of PRA and systems inter-actions. At the present time, we do not perceive any organizational conflict of interest based upon these facts and do not believe the Staff's PRA testimony in that proceeding will be influenced in any significant way by the views of NUS as to the conduct of a review of a PRA. On the basis of the review it has conducted, the Staff does not believe the information as to SAI's (and NUS') consultant services for the Staff and for the Applicant is relevant and material to the position it has taken on PRA and systems interactions before the Shoreham Licensing Board. See generally Tennessee Valley Authority (Browns Ferry Nuclear Plant, Units 1, 2, and 3), ALAB-677,15 NRC (1982); Duke Power Co. (McGuire Nuclear Station, Units 1 and 2), ALAB-143, 6 AEC 623, l 625 (1973). The Staff agrees that the subtle interrelationships between the services performed by consultants for the nuclear industry and the l NRC, particularly in such interdisciplinary areas as PRA and systems 1 interactions analysis, merit scrutiny and that all parties to NRC pro- .ceedings should be under an obligation to disclose to the other parties and to the presiding board tnose interrelationship; of which they are aware which they believe to be relevant and material to the proceeding in l question. With respect to the Limerick proceeding, Staff counsel was not aware of SAI's consultant activities for the Staff at the time of the 1 January 1982 Special Prehearing Conference at which the proposed PRA contentions were extensively discussed. Although Staff counsel for l

' Limerick believe they had seen references to SAI services to the Staff on systems interactions prior to the time the issue was raised in Shoreham, Staff counsel did not focus upon the possible significance of that information to the independence of the Staff's review of the Limerick PRA. In any event, pursuant to the request of the Shoreham Licensing Board (two of whose members also serve on the Limerick Licensing Board), we will serve copies of this report and other relevant pleadings and transcript passages on the Licensing Board and parties in the Limerick proceeding. Respectfully sule 'ted, Ralph E. Avery (f Counsel for NRC StaM 'l UN t'epTe H. Lewis Counsel for NRC Staff Jh$Y-Richard 3.RKson-Counsel for NRC Staff Dated at Bethesda, Maryland this 23rd day of July, 1982 l l l

.~ .e 1 07/23/82 i UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION BEFORE THE ATOMIC SAFETY AND LICENSING BOARD ^ In the Matter of ) 1 ) j LONG ISLAND LIGHTING CO. ) Docket No'. 50-322(OL) j (ShorehamNuclearPowerStation, l Unit 1) ) NOTICE OF APPEARANCE Notice is hereby given that the undersigned attorney herewith enters an appearance in the above-captioned matter. In accordance with 10 C.F.R. 5 2.713(a), the following infonnation is provided: Name: Stephen H. Lewis Address: U.S. Nuclear Regulatory Comission Office of the Executive Legal Director Washington, DC 20555 i Telephone Number: (301)492-8655 Admissions: Supreme Judicial Court of Massachusetts District of Columbia Court of Appeals {;'. United States Supreme Court i Name of Party: NRC Staff Respectfully submitted, j Stephen H. Lewis j Counsel for NRC Staff I Dated in Bethesda, Maryland i l this 23 day of July, 1982 i ,i 1 i d

UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION BEFORE THE ATOMIC SAFETY AND LICENSING BOARD f ( In the Matter of Long Island Lighting Company Docket No. 50-322 0.L. (Shoreham Nuclear Power Station, Unit 1) NOTICE OF APPEARANCE Notice is hereby given that the undersigned attorney herewith enters an appearance in the captioned matter. In accordance with 92.713 of the Commission's Rules of Practice, the following information is provided: Name: Ralph E. Avery Address: Office of the Executive Legal Director U.S. Nuclear Regulatory Commission Washington, D.C. 20555 Telephone Number: (301)492-8656 Admissions: District of Columbia Court of Appeals U.S. Supreme Court Name of Party: U.S. Nuclear Regulatory Commission Washington, D.C. 20555 Ralphf E. Avery () Counsel for the NRC Ytaff Dated at Bethesda, Maryland this 23rd day of July,1982. 1

is19e O Tederal Register / WI. 44. No. 64 / Mendad April 2.19"9 / Rules and Regulations i PART 20-1-GENERAL. process. NRC agreements with other and subcontracts in amounts of $10000 government agencies. international or less. Subpart 20-1.54-Contractor orgamzations, or state local or foreign (i)" Prospective contracto j Organizational Conflicts of Interest governments; separate procedures for " offeror" means any person,r" or j avoiding conflicts of in'erest will be

firm, N.5401 Scope and policy.

e'ep! yed in such agreements. as unincorporated association, joint I 20 1.54o2 Definsuona. appropriate. venture. partnership, corporation. or 20 1.54o3 Cntena for recognizing contractor affiliates thereof. including its chief orgar.1:s tional confiets of interest. i 20-1.5402 Definitions. executive, directors. key personnel 20-1.5404 Representauon. (a)"Organi.zational conflicts of (identified in the proposal). proposed $$5 C $',*,',claug % interest" means that a relationship consultants. or subcontractors. 3,3 cialk exists whereby a contractor or submitting a bid or proposal. solicited or i 20-1.5405-2 5 EvaNauon.ontract t rovuions. Lndings, and contract prospective contractor has present or unsolicited, to the NRC to obtain a 20-1.5400 sward. planned interests related to the work to contract. 20-1.5407 Conflicts identified after award. be perfortned under an NRC contract (j) " Potential conflict ofinterest" gg g which:(1) May diminish its capscity to means that a factual situation exists that 20-1.5410 subcontractors. give inspardal. technicaUy sound. suggests (indicates) that an actual 20-1.5411 Waiver. objective assistance and advice or may conflict ofinterest may arise from 20-1.5412 Remedies, otherwise result in a biased work award of a proposed contract.The term s aurwoarry: Sec. 8. Pub. L 95 601. a dhling sec. Product or(2)mayresultinits being " potential conflict ofinterest"is used to 170A to Pub.1. as-ros. as Stat. pt9. as given an unfair competitive advantage, signify those situations wjiich merit 2 amended (42 U.S.C. ch.14). (b) "Research" means any scientiSc or investigation prior to contract award in order to ascertain whether award would f 20-1.5401 Scope and poucy. W & M an acW det a 6 y, plof a (a)It is the poh.cy of the U.S. Nuclear experimenta+1on. must be reported to the contracting i Regulatory Comnussion (NRC) to avoid. (c)" Evaluation activities" means any during contract performance.y arise officer forinvestigation if the ehminate or neutralize contractor effortinvolving the appraisal of a organizational confhets ofinterest. The NRC achieves this objective by requiring technology process, product or policy. I 20-1.5403 Crtteria for recognizing (d " Technical consulthrg and contractor organizatonal conthets of all prospective contractors to submit man)agement support services" means intecost. information describing relationships. if internal assistance to a component of (a) General.Two questions wiH be any. with organizations or persons the NRC in the formulation or asked in determining whether actual or (including those regulated by NRC) which may give rise to actual or artministration of its programs. projects, potential organizational conflicts of potential conflicts ofinterest in the or policies which normally require the interest exist:(1) Are there conflicting event of contract award. contractor to be given access to roles which might bias a contractor's information which has not been made (b) Contractor conflict ofinterest available to the public or proprietary judgment in relation to its work for the. determinations cannot be made information. Such services typically NRC? (2) May the contractor be given an application of sound judgment on include assistance in the preparation of unfair competitive advantage based on automatically or routinely; the the performance of the contract? The program plans: and preparation of ultimate determination by NRC as to virtually a case.by. case basis is pretuninary designs. speci5 cations, or whether organizational conflicts of necessary if the policy is to be applied statemerits of work. interest exist will be made in light of so as to satisfy the overall public (e} " Con'ract" means any contract. common rense arid good business interest. t is not possible to prescribe in agreement, or other anangement with judgment based upon the relevant facts advance a specific method or set of the NRC except as provided in i 20. disclosed and the work to be performed. criteria which would serve to identify 1.5401(c). While it is difficult to identify and to I and resolve all of the contractor conflict (f)" Contractor" means any person. prescribe in advance a specific method ofinterest situations which might arise; however, examples are provided in firm, unincorporated association. Joint for avoiding all of the various situations these regulations to guide application of venture. co-sponsor, partnership, or relationships which might involve the policy. NRC contracting and corporation, affiliates thereof, or their potential organizational conflicts of successors in interest, including their interest. NRC personnel will pay program officials must be alert to other chief executives. directors. key particular attention to proposed - situations which may warrant personnel (identified in the contract). contractual requirements which call for application of this policy guidance.'Ibe proposed consultants or subcontracters. - the rendering of advice, consultation or uhimate test is: Might the contractor. if which is a party to a contract with the evaluation activities. or similar awarded the contract, be placed in a NRC. activities th~ t lay direct groundwork for I position where its judgment may be (g)"Aff111ates" means business the NRC's decisions on regulatory a biased. or where it may have an unfair concerns which are affiliates of each activities: future procurements, and competitive advantage? other when either directly or indirectly research programs. (c) The conflict ofinterest rule one concern or individual controls or-(b) Situations or relationships which contained in this subpart appl.es to has the power to control another, or may give rise to organizational conflicts contractors and offerers only, when a third party controls or has the ofinterest. (1) The offeror or contractor Individuals or firms who have other power to control both (41 CFR 1-1.605-shall disclose information concerning relationships with NRC (e.g parties to a 1(c)). , relationships which may give rise to l licensir? procaeding) are not covered by (h)" Subcontractor" means any organizational conflicts of interest under this regL :on. This rule does not apply subcontractor of any tier which the following c.rcumstances: to the acquisition of consulting services performs work under a contract with the (i) Where the offeror or contractor through the personnel appointment NRC except subcontracts for supplies provides advice and recommendations S i JL -.

r eder:: Hermer / vol. 44. Ns. 64 i Memfav. April 2.1979 / Rutas cnd Reeul:ti;ns 19199 = to the NRC in e teghnicz! crea in which cdvis:s that it is curr:r it is n!so providmg consulting as'sistance

• similar shalyses for the}tly performing cf the policy may be warranted. Any reactor such waiver shall be fully documented in the same ar'en to any organization manufacturer.

and coordinated in accordance with the regulated by the NRC. Guidance. An NRC contract for that waiver provisions of this policy with (ii) Where the offeror or contractor particular work normally would not be particular attention to the establishment provides advice to the NRC on the same awarded to the XYZ Corp. because it of protective mechanisms to guard or similar matter m which it is also would be placed in a position in which against bias. providing assistance to any organization its judgment could be biased in (4) Example. The ABC Co. submits a r:gulated by the NRC. relationship to its work for NRC. Since proposal for a new system for (iii) Where the offerer or contractor there are other well-qualified companies evaluating a specific reactor evaluates its own products or services, available there would be no reason for component's performance for the or the products or services of another considering a waiver of the policy. purpose of developing standards that entity where the offeroror contractor (2) Example. The ABC Corp., in are important to the NRC program.The has been substantially involved in their response to a RFP. proposes to perform ABC Co. has advised NRC that it development or marketmg:. certain analyses of a reactor component intends to sell the new system to (iv) Where the award of a contract which are unique to one type of industry once its practicability has been would otherwise result in placing the advanced reactor. As is the case with demonstrated. Other companies in this efferer or contractor in a conflienng role other technically qualified companies business are using older systems for ~ in which its judgment may be biased in responding to the RFP. the ABC Corp. is evaluation of the specific reactor relation to its work for the NRC or may performing various projects for several component. etherwise result in an unfair competitive different utility clicnts. None of the ABC Guidance. A contract could be cdvantage for the offeror or contractorg Corp. projects have any relationship to awarded to the ABC Co. provided that (2) The contracting officer may the work called forin the RFP. Based on the contract stipulates that no request specific information from an the NRC evaluation, the ABC Corp. is information produced under the contract efferor or contractor or may require considered to be the best qualified will be used in the contractor's private special contract provisions such as company to perform the work outlined activities unless such information has provided in i 20-L5405-2 in the in the RFP. been reported to NRC. Information f;11owing circumstantes: Guidance. An NRC contract normally which is reported to NRC by contractors (i) Where the offeror or contractor could be awarded to the ADC Corp. will normally be dissemmated by NRC prepares specifications which are to be because no conflict ofinterest exists to others so as to preclude an unfair used in competitive procurements of which would motivate bias with respect competitive advantage that might products or services covered by such tc the work. An appropriate clause

• otherwise accrue. When NRC furnishes specifications.

would be included in the contract to information to the contractor for the (ii) Where the offeror or contractor preclude the ABC Corp. from performance of contract work. it shall prepares plans for specific approaches subsequently contracting for work not be used in the contractor's pnvate cr methodologies that are to be during the performance of the NRC activities unless such irJormation is incorporated into competitive contract with the private sector which generally available to others. Further, procurements using such approaches or could create a conflict. For example, the contract will stipulate that the methodologies. ABC Corp. would be precluded from the contractor willinform the NRC (iii) Where the offeror or contractor is performance of similar work for the contracting officer of all situations in granted access to information not company developing the advanced wh.ch the information developed under available to the public concerning NRC reactor centioned in the example, the contract is proposed to be used. plans. policies, or programs which could (3) Example. As a result of operating ' (5) Exa=ple. The ABC Corp.,in f:rm the basis for a later procurement problems in a certain type of response to a RFP proposes to assemble action. commercial nuclear facility,it is a map showing certain seismological (iv) Where the offeror or contractor is imperative thit NRC secure specific festures of the Appalachian fold belt. In i. granted access to proprietary data on various operational aspects of accordance with the representation in (* information of its competitors. that type of plant so as to assure the RFP and i 20-1.5403(b)(1)(i). ABC l (v) Where the award of a contract adequate safety protection of the public. Corp. informs the NRC that it is I might otherwise result in placing the Only one manufacturer has extensive presently doing seismological studies for efferor or contractor in a conflicting role experience with that type of plant, several utilities in the Eastern United in which its judgment may be biased in Consequently, that company is the only States but none of the sites are within relation to its work for the NRC or may one with whom NRC can cor.traci v hich the geographic area contemplated by the otherwise result in en unfair competitive can develop and conduct the testing NRC study. ddvantage for the offeror or contractor. programs required to obtain the data in Guidance.ne contracting officer L (c) Policy applica tion guidance. The rea4onable time. That company has a would normally conclude that award of l f:llowing examples are illustrative only definite interest in any NRC decisions a contract would not place ABC Corp. in and are not intended to identify and that might result from the data produced a conflicting role where its judgment . resolve all contractor organizational because those decisions affect the might be biased.ne work for others conf'ict of interest situations. reactor's design and thus the company's clause of i 2M.5405-1(c) would (1) Example.The XYZ Corp.,in costs. preclude ABC Corp. from accepting response to a request for proposal (RFP). Guidance.%is situation would place work during the term of the NRC l proposes to undertake certain analyses the manufacturer in a role in which its contract which could create a conflict of cf a reactor component as cal!ed for in judgment could be biased in relationship interest. the RFP. The XYZ Corp. is one of to its work for NRC. Since the nature of (d) Other considerations. (1) %e fact several companies considered to be the work required is vitally irnportant in that the NRC can identify and later t;chnica!!y well qualified. In response to terms of NRC's responsibilities and no avoid, eliminate, or neutralize any the inquiry in the RFP. the XYZ Corp. reasonable alternative exists, a waiver potential organizational conflicts arising ' ~* y m- = e? I. l e l l u l. gg.j;15 -Qi f j Q "~ ?G,*, Q y.y MC Y -.. g"s -; =,v. f 7gr Q"~'~ g7p~ p. w- :, g,, p r= - --.,,,e m, ,,m

i NI y Fed $r:1 Rigistar / Vol. 44. No. 64 / htcr. day. Apn! 2.19 9 / Rulas end RestatRn3 j** 19200 from the performance of a contract is officer determines that organizational pa-ticipation by the cont'ramor as not relevant to a determination of the conflicts exist. the following actions defined in 41 CFR 5 SI.54C(f)in the existence of such conflicts prior to the may be taken:(i) Impose appropriate activities covered by this dm:se. sward of a contract. conditions whi:h avoid such conflicts. (c) Woric for others. Notwithstanding a' (2)!t is not relevant that the (ii) disqualify the offeror, or (iii) any other provision of this contract. contractor has the professional determine that it is otherwise in the best dunng the term of this contract. the ~ d reputation of being able to resist interest of the United States to seek contractor agrees to forgo entering into te=ptations which arise from award of the contract under the w aiver consulting or other contractual ? organiza tional' conflicts of interes t. or provisions of i 20-1.5411. arrangements with any firm or d that a foUow.on procurement is not (2) De refusal to provide the organization, the result of which may 3 j involved, or that a centract is awarded representation required by I & give rise to a conflict ofinterest with on a competitive or} sole source baats. 1 l l N.54M hpre dth ~ 1.5404(b) or upon request of the respect to the work being performed i contracting officer the facts required by under this contract.The contractor shall I W1.5404(c). shall result in ensure that all employees who are ) ]! (a) The foUowing proc'edures are disqualification of the offeror for award. employed fud time under this contract designed to assist the NRCcontracting The nondisclosure or misrepresentation and e=ployees designated as key officer in deter:nining whether situations of any relevant interest may also result personnel. if any.under this contract i - or relationships exist which may in the disqualification of the offeror for abide by the provision of this clause.lf. constitute organizational conflicts of award; or if such nondisclosure or the contractor believes with respect to interest with respect to a particular misrepresentation is discovered after itself or any such employee that any d offeror or contractor. award, the resultmg contract may be proposed consultant or other contractual 3 (b) Representation procedure. The terminated. The offerer may also be arrangement with any firnior f foUowing organizational conflicts of disqualified from subsequent related organization may involve a potential interest representation provision shan NRC contracts and be subject to such conflict of interest. the contractor shall I be included in all solicitations and other remedial actions provided by law obtain the wntten approval of the unscheited proposals for:(1) Evaluation or the resulting contract. contracting officer prior to execution of services or activities;(2) technical (d) De offeror may, because of actua} such contractual arrangement. consulting and management support or potential organizational conflicts of (d) Disclosure after owcrd (1) De i services; (3) research; and (4) other interest, propose to exclude specific contractor warrants that to the best of ) contractual situations where special kinds of work from the statements of its knowledge and belief and except as organizational conflicts of interest ' work contained in a RTP unless the RJp otherwise set forth in this contract,it i i provisions are noted in the solicitation specifict.lly prohibits such exclusion. does not have any organizational i and would be included in the resulting Any such proposed exclusion by an conflicts of interest, as defined in 41 I contract. This representation offeror will be considered by the NRC in CFR 20-1.5402(a). requirement shall also apply to all the evaluation of proposals. lf the NRC (2) ne contractor agrees that if after modifications for additional effort under considers the proposed excluded work award i,t discovers organizational the contract except those issued under to be an essential or integral part of the conflicts of interest with respect to this. {j; the " changes' clause. Where, however, required work and its exclusion would contract. It shaU make an i= mediate and lj a statement of the type required by the work to the detriment of the competitive full disc!csure in wnting to the organizational conflicts ofinterest posture of the other offerors, the contracting officer.This statement shah representation prosision has previously proposal must be rejected as include a description of the action which i I been submitted with regard to the unacceptable. the contractor has taken or proposes to contract being modified, only an (e) The offeror's failure to execute the take to avoid or mitigate such conflicts. l updating of such statement sha*1*ae representation required by paragrapn (b) The NRC nay, however, ter.~inate the required. of this section with respect to invitation. contract for convemence ifit dee=s i hanizadual ConfUcts of or bids will be considered to be a minor such termination to be in the best ' Intamt Repmentadon informality, and the offeror will be interests of the govertiment. permitted to correct the omission. (e) Access to and uss ofinformation. ! represent to the best of rny knowledge and (1)If the contractor in the performance s belief that: I 20-1.5405 Contract ciauses of this contract obtains access to e: c tion of an exis ng contr et does l 20-1.5405-1 General contract clause rma o s e as a ( ) or does not ( ) involve situations or All contracts of the types set forth in internal data protected by the Privacy o p f the type set forth in 41 Cm $ 20-1.5404(b) shall include the following clauses: Act of 1974 (Pub. I. 93-579) or data which has not been released to the (c) Instructions to offerors.The (a) Purpose..The primary purpose of public, the contractor agrees not to:(i) l foUowing shall be included in au NRC this clause is to aid in ensuring that the Use such information for any private j solicitations:(1)If the representation as contractor:(1)Is not placed in a purpose until the information has been completed indicates that situations or conflicting role because of current or released to the public:(ii) compete for relationships of the type set forth in 41 planned interest (financial, contractual, work for the Commission based on such CFR 20-1.5403(b)(1) are involved. or the organizational, or otherwise) which information for a period of six (6) contracting officer otherwise determines relate to the work under this contract. months after either the completion of that potential organizational conflicts and (2) does not obtain an unfair .this contract or the release of such exist, the offeror shall provide a competitive advantage over other information to the public whicheveris I statementin writing which describes in parties by virtue ofit.s performance of first. (iii) submit an unsolicited proposal a concise manner allrelevant facts this contract. to the government based on such bearing on his represcatation to the (b) Scope.%e restrictions described information until one year after the contracting offlcer.If the contracting herein shaU apply to performance or release of such information to the ~

• e S

e e

Nderal RIxist:r / Vol. 44. No. 64 / Mor. day. Apnl 2.19~9 / Ruhs rnd RIruitthns trot public, or (iv) release the information nonproduction contract previously (b) Avoid or eliminate such conflicts without prior wntten approval by the performed by the contractor; by appropnate measures; or contracting officer unless such (2) Software exdusion clauses; (c) Award the contract under.he information has previously been (3) Clauses which require the waiver provision of I 20-1.5411. released to the public by the NRC. contractor (and certain of his key (2)In addition, the contractor agrees personnel) to avoid certain i 20-1.5407 Connicts identified after that to the extent it receives or is given organizational conflicts of interest; and award. access to proprietap data, data (4) Clauses which provide for If potential organizational conflicts of protected by the Privacy Act of1974 protection of confidential data and interest are identified after award with (Pub. L 93-579), or other confidential or guard against its unauthorized use, respect to a particular contractor, the privileged technical, business or (b) The foDowing additional contract contracting office determines that such financialinformation under this deuse may be included as section (i)in conflicts do,in fact, exist and that it contract, the contractor shall treat such the clause set forth in i 20-1.5405-1 would not be in the best interests of the hformation in accordance with when it is determined that award of a government to terminate the contract as restrictions placed on use of the follow-on contract would constitute an organizational conflict of interest. provided in the clauses required by information. (3) ne contractor shall have, subject (i) Follow-on effort. (1) The contractor I 20-1.5405, the contraeting ofScer will ' to patent and security provisions of this shall be ineligible to participate a NRC take every reasonable action to avoid. ~ rentract, the right to use technical data contracts subcontracts, or proposals eliminate, or, after obtaining a waiverin accordance with 120-1.5411. neutralize - it produces under this contract for therefor (solicited or unsolicited) which g private purposes provided that all stem directly from the contractor's the effects of the identified conflict. requirements of this contract have been performance of work under this - l 20-1.5408 fReserved] ^ ' met. contract. Furthermore, unless so (f) Subcontracts. Except as provided ' directed in writing by the contracting i 20-1.5409 [Reservedl in 41 CFR 20-1M02(h), the contractor officer. the contractor shall not perform shallinclude this clause, including this any technical consult!ag or management I* 8 "D* "#* ***'. paragraph,in subcontracts of any tier. support services work or evaluation ne contractin' officer sha'll require g The terms " contract." " contractor." and activities under this contract on any of offerors and contractors to submit a " contracting officer." shall be its products or services or the products representation statement in accordance cppropriately modified to preserve the or services of another firm if the with i St.5404(b) from subcontractors government's rights. contractor has been substantially and consultants. The contracting officer (g) Remedies. For breach of any of the involved in the development or shall require the contractor to indude cbove proscnptions or for intenticnal marketing of such products or services. contract clauses in accordance with nondisclosure or misrepresentation of (2)If the contractor under this l W1.5405 in consultant agreements or cny relevant interest required to be contract prepares a complete or subcontracts involving performance of disclosed conceming this contract or for essentially complete statement of work work under a prime contract covered by such erroneous representations as or specifications, the contractor shall be this subsection, necessarily imply bad faith, the ineligible to perform er participate in the government may terminate the contract initial contractual effort which is based l 20-1.5411 Walver for default disqualify the contractor on such statement of work or (a)In the first instance determination (rom subsequent contractual efforts, and speciScations. The captractor shall not with respect to the need to seek a pursue other remedies as may be incorporate its products or services in waiver for specific contract awards ~- permitted by law or this contract. such statement of work or specifications shall be made by the contracting efficer (b) Waiver. A request for waiver unless so directed in writing by the with the advice and concurrence of the under this clause shall be directed in contracting officer, in which case the writing through the contracting officer to restriction in this subparagraph shall not program office director and the Office of the Executive Director for Operations apply. Executive Legal Director. Upon the (EDO)in accordance with the (3) Nothing in this paragraph shall recommendation of the contracting procedures ' outlined in 1 20-1.5411. preclude the contractor from offering or officer, and after consultation with the N 20-13405-2 Spectat contract provisions. semng its stanM commerciahtems t Office of the General Counsel, the EDO he g 1. may waive the policy in spemSe cases if (a) If it is determined from the nature he determines that it is in the best i cf the proposed contract that i 20-1.5406 Erstunuon, findings, and interest of the United States to do so. l. crganizational conflicts ofinterest exist, contract award. (b) Such action shall be strictly the contracting officer may determine The contracting officer will evaluate limited to those situations in which:(1) that such conflict can be avoided or all relevant facts submitted by an The work to be performed under titer obtaining a waiver in accordance offeror pursuant to the representation contract is vital to the NRC prograrn: (2) l with I W1.5411. neutralized through the requirements of i St.5404(b) and other ' the work cannot be satisfactonly i use of an appropriate special contract relevant information. After evaluating performed except by a contractor whose provision. lf appropriate, the offeror may this information against the criterin of interests give rise to a question of n;gotiate the terms and conditions of i St.5403la finding will be made by these clauses. including the extent and the contracting officer whether conflict of interest: and (3) contractual and/or technical review and supervision l time period of any such restriction. organizational conflicts of interest exist These provisions include but are not with respect to a particular offeror. Ifit methods can be employed by NRC to limited to: has been determtned that conflicts of. neutralize the conflict. For any such (1) Hardware exclusion clauses which interest exist. then the contracting waivers, the justification and approval prohibit the acceptance of production officer shall either: documents shall be placed in the Public Document Room. contracts following a related (a) Disqualify the offeror from award. / ~. 8 9 ,g f a

c2 Feder:1 Rerister / Vol. 44. f4. 64 / Monday. /4n) 2.19 9 / Ruhs entt Rer:1stiens 1 l 20-1.5412 Remedies.

• ID OPERA'TE OVER' TRACKS OF THE

1. K' nn~th Carter. Chief. Utilization and 1

In addition to such other remedies as ATCH/ SON. TOPEKA AND SANTA EE Distribution Branch. Interstate e may be permitted by law or contract for RAILWA YCOMP.4NYis amended by Commerce Commission. Washington, g a breach of the restrictions in this substituting the following paragraph (c) D.C. 20423. Telephone (202) 275-7840, subpart or for any intentional for parepaph (c) thereof: Telex E9-2742. c' misrepresentation or intentional c nond2sclosure of any relevant interest (c) Expiration dere. The provisions of Decided March :7.1979. a requiredJo be provided for this section, this order shall remain in effect unni Upon further consideration of Service ,} the NRC may tiebar the contractor from roodified or vacated by order of this Order No.1290 (42 FR 63890. 43 FR 14021 subsequent NRC contracts. Commission. and 45868 won ). and good cause appearing ] Dated at Washint.o'n. D.C. this 2rth day of Effective dote. His amendment shall become effective at 11:59 p.m March 31 Itis ordered that Service Order No. 1 March 19r9. 1290, i 1033.1290 The Chesapeake and For the Nuclear Regulatory Commission. 1979. 5'"4CE Ohio Railway Company Authorized To ~ (49 U.S.C. (10304-10305 and 11121-11126).)Operate Over Tracks of Consolidated 7 '. .nis order shall be served upon the Rail Corporation be, and it is hereby. Association of American Railroads. Car amended by substituting the followmg., Service Division, as agent of the parapaph (f) for paragraph (f)1 hereof: railroads subscribing to the car service INTERSTATE COMMERCE avd car hire agreement under the terms (f) Expiration dote. The provisions of \\ COMMISSION i of that speement and upon the this order shall remain in effect until American Short Line Railroad modined or vacated by order of this 1 49 CFR Part M33 Association. Notice of this order shall be Commission. j given to the general public by depositing Effective dcte. %is amendment shall Car Service; Missouri Pacific Railroad a copy in the OfEce of the Secretary of . become effective at 11:59 p.m., March 31. Co. Authorized To Operate Over the Commission at Washington. D.C., 1979. i Tracks of the Atchison, Topeka,and and by filing a copy with the Director. (49 U.S.C. (20304-tosos and 111:1-11128).) Santa Fe Co. Office of the Federal Register. -AGENCY: Interstate Commerce By the Commission. Railroad Service Board. A copy of tliis amendment shall be Cornmission. members Joel F_ Burns. Robert S. Turkington served upon the Association of , and John R. Michael American Railroads. Car Service ACTION: Emergency Order Amendment ag % g Didsion. as agent of all railroads No. 4 to Service OrderNo.}269. subscribing to the car service and car 3**a7 hire speement under the terms of that

• suuMARY:The Missouri Pacific's line

[1& Na 13s. AmA N* 41 agreement, and Upon the American - between Winfield. Kansas, and p ow. - rsa m =,,4 j t s .E .. l-! N ? 4' e . s.. I g s g_.'s y I Ml. ', _ \\< _g?\\ e* i 7 'b } '.) 'il ; '/I j (':; ' ( ' '} s 1 ai 1-t. f, , \\'

k U.S. NUCLEAR REGULATORY.CObD11SSION NRC MANUAL Volume: 1000 Finance Part : 1100 Accounting CON CHAPTER 1102 PROCEDURE FOR PLACEMENT OF WORK WITH THE DEPARTMENT OF ENERGY 1102-01 COVERAGE This chapter covers the responsibilities, authorities, and procedures for plac-ing work' with the U.S. Department of Energy (DOE) and its contractors, and (a) obligating NRC funds on a reimbursable basis, (b) paying for such work, and (c) preparing and issuing reports on the work. It represents the actions necessary to implement Section III and portions of Section VII of the DOE-NRC .l memorandum.of understanding dated February 24, 1978. This chapter has been coordinated with and indicated to be acceptable to the U.S. Department of Energy. It does not cover procedures for placement of work with other government agencies or outside contractors. 1102-02 OBJECTIVES 'i I. !!; \\,,, '. 0 21 To provide a standardized procedure for requesting and authoriz-l ( ing work to be performed by DOE under interagency agreement on a reim-l bursable basis. It also provides a framework for program control, administration, monitoring, and closecut of approved work. 022 To provide terms and conditions for work to be performed by DOE. 1102-03 RESPONSIBILITIES AND AUTHORITIES 031 Directors of Offices: l-l 1 l N '. a. cooperate with DOE in long-range planning so as to ensure that both agencies anticipate the magnitude of funding, alloca-tion of resources, and timing of events necessary to conduct a interagency activities in accordance with the DOC-NRC Inter-

• j agency Agreement on Institutional Planning System, dated l

y August 18, 1978. l J l b. issue requests for work proposals from DOE for research or 4 technical assistance work (program support) to be performed j at DOE facilities. c. evaluate the proposals; determine that the documents are tech-f.j nically adequate and that budgetary authority exists. !.]) dufj Approved: October 2, 1979 iJ

PROCEDURE FOR PLACEMENT OF WORK NMC-Il02-031 WITH THE DEPARTMENT OF ENERGY .m d. prepare, coordinate, authorize, sign and issue NRC Forms 173, " Standard Order for DOE Work" (SOEW), and accompanying statements of ' work. ThG authority may be redelegated with written notification provided to the Director, Division of Accounting. 5 establish, with regard to each research or technical assistance e. program, overall and specific plans; monitor and assess pro- .i gress; followup to ensure that program results are properly analyzed, evaluated, and disseminated; additionally, insure that adequate feedback exists for the incorporation of results ~l into the Commission's confirmatory assessment program and other regulatory activities. Keep the DOE operations offices. 9 and the Safety Engineering Division (EV/ SED) informed of - 3 appropriate activities, including prior notification of planned

j program reviews and visits.

.} f. coordinate and obtain the NRC Division of Security facility approval prior to placement of classified work at DOE facilities 4 and notify the Division of Security of the completion of classi-fied work. ensure appropriate clauses are included in the Standard Order .I g. for DOE Work regarding the private use and protection of pro ' prietary and sensitive unclassified government infomation. ( 9'# h. during the course of work, develop any additional listings, "i reports, or other information required for the completion of I NRC directed programs or tasks. timely funding or guidance to permit continuance of [1 on-going programs which encompass more than one fiscal year. i i. provide j. formally notify DOE operations offices of any on-going pro-y[J grams the sponsoring office intends to phase out or terminate .j-as soon as such intent is known. '.1 - f.h . k. review all billings certified by DOE in accordance with the of work and the SOEW, and approve for payment by 2i scope ); signature on transmittal memorandum to the Division of Accounting. This responsibility may be redelegated with the .x Division of Accounting advised. g i 49 1. assure that the proposed work shall be in accordance with ap- .M. propriate conflict of interest policy and regulations. l sfg $kJ m. coordinate and obtain Division of Automatic Data Processing t Support approval prior to placement of tasks limited to computer - '3] support for NRC offices at DOE facilities. M. /' . ;.] \\

t

• Q 2:

l .] 'lw

t PROCEDURE FOR PLACEMENT OF WORK WITH THE DEPARTMENT OF ENERGY NRC-1102-032 maintain supporting data justifying placement of tasks with DOE n. versus commercial contracting which indicates the basis of the placement. 032 The Office of the Controller: a. carries out implementation of the NRC-DOE Memorandum of Understanding through Management Directives, publication of Bulletins, and guidance memoranda to NRC program offices. i b. provides consolidated long-tenn planning data and annual budg-etary information to meet both DOE and NRC planning requirements. 033 Director, Division of Budget: n a. issues allotments and approves financial plan information to Q NRC program offices. b. maintains official allotment records for EDO and Commission offices and certifies funding availability for these offices. provides FIN listing to the Division of Accounting and reviews c. the applicable program office financial summary data. _..s . 7 d. provides advice and guidance to other NRC offices as required 9 \\, for formulation of budget estimates. provides financial program status analyses to the Executive Di-i e. rector for Operations and the Commission as required. j.; f. maintains and files copies of all NRC Standard Orders for DOE Work with accompanying statements of work and laboratory l proposals. Reviews for proper office coordination and duplica-tion of effort. ., f. - 2. '. ' --[ 034 Director, Division of Accounting: 8 a. records obligations against those SOEW's that have been (i accepted by DO.' and forwarded to the Division of Accounting i i assuring use of.. roper accounting citations, FIN, and Budget and Reporting Classifications (B&R). 3, -,'ii b. records costs as reported by DOE through receipt of their .i monthly Financial Information System (FIS) tape. 43 ,.4 c. receives all billings from DOE for work performed for NRC, -j transmits billings to appropriate NRC program offices for re-U view and approval signature: upon receipt thereof, certifies correct for payment through the U.S. Treasury. -y) [Qfj /..,3 d. monitors day-to-day status of not-yet-accepted or rejected SOEW's and provides infort;.ation to NRC program offices.

]

.: 2 A i I erem woor L ms

...s.'..-.........:.. l PROCEDURE FOR PLACEMENT OF WORK NRC-1102-035 WITH THE DEPARTMENT OF ENERGY

• )

r e. maintains records of outstanding DOE uncosted obligations and unpaid billings and provides reports to NRC program offices. f. resolves day-to-day problems associated with billings through direct contact with DOE operations offices (such as billings 4 that do not reflect costs as reported through the FIS,

-]

incorrect or invalid FIN, etc.). .l transmits to the Property and Supply Branch, ADM. and the g. 3 program offices copies of all itemized receiving reports fur-nished by DOE for equipment and related material funded by -t NRC. - i]_ l 035 Director, Division of Security: provides advice and assistance to NRC program offices on the a. .1 placement of classified work at DOE facilities. a b. obtains facility approval for classified work from the appropri-ate DOE Operations Office Security Organization and notifies >d the NRC program office of such approval. c. maintains master facility register for all NRC classified interests at DOE facilities.

. - s 1

~- 'Y! 036 Director, Division of Technical Information and Document Control: \\./ C6 develops and issues instructions in conjunction with the NRC ij a. program offices and DOE /OTI for the preparation of reports. v::: ..:a ,Rj b. prints or duplicates reports as specified by the terms and con- '.] ditions of the Standard Order for DOE Work. Bj c. makes physical distribution of all reports required by the e4 Q; SOEW that are to be made publicly available. .:.El ',[ 037 Director, Division of Automatic Data Processing Support: . :m provides advice and assistance to NRC program offices in ob-J.) a. c9'] taining computer services at DOE facilities. 41 .M b. obtains DOE facility approval for computer services to NRC ' M1 staff. jd4 prepares requests for work proposals and evaluates DOE pro- .g.5 c. 5 posals for computer services to NRC staff. d. provides cordinated hardware and consulting software support - F... services to NRC offices obtaining computer services at DOE 'M facilities. ,.- s x V -aql 1 'SM

• ,.t

. PROCEDL*RE FOR PLACEMENT OF WORK WITH THE DEPARTMENT OF ENERGY NRC-1102-04 t 1102-04 B ASIC REQUIREMENTS 041 Request for Work Proposals from DOE for New or Continuing Pro grams. In the fomulation of their annual budget, DOE Operations Officas submit work proposals to DOE Headquarters to support the funding level re-quested in their budgets for both new efforts and continuing work. These work proposals are received in May of each year for work in the next fiscal year. For efforts in support of the NRC, copies of the proposals are sent directly to the NRC office concerned, with infomation copies sent to the DOE Safety Engineering Division (EV/ SED). These proposals may be requested or submitted at any time during the year. t ..i s l Some NRC offices use these proposals in formulating their budget and issue orders to DOE to perform the work contained in the work proposal. Other NRC offices rely primarily or completely upon work proposals submitted by DOE in response to requests from the NRC. Exhibit I shows how to prepare a request for work proposed to DOE. It indicates the minimum information required for all requests (additional infor-mation may be requested when needed). A sample transmittal letter is also included in the Exhibit. Note: Copies must be provided to Headquarters, ~' DOE, EV/ SED (2). g j,< 3 042 Ordering Work to be Performed by DOE. After evaluation of an i<.f appropriate work proposal from DOE, worx shall be authorized by issuance of an NRC Form 1"3, " Standard Order for DOE Work," as inustrated in Exhibits '} 2, 3 and 4. When the work is being initiated in response to user require-j men ts. the office originating the user requirement will be consulted during 7 the preparation of the SOEW. .] The standard transmittal letter (Exhibit 2) should be addressed to the Manager of the appropriate DOE Operations Office (and his designee when 1 notified in advance) and include the three paragraphs shown in the Exhibit. I y An information copy should be sent to the Safety Engineering Division ,, y (EV/ SED) at DOE Headquarters as wen. The transmittal letter may include .fi additional information, but it should be noted that the transmittal letter is not '.j a part of the order. ,,q ' Ii To insure projects are properly reviewed and coordinated within NRC, each , /, program office (RES, NRR, NMSS. IE, SD) win provide copies of standard ~ transmittal letters with any attachments to all other program offices (including l International Programs and State Programs as appropriate) for all projects of 9 $100K or greater. It win remain the individual responsibility of the issuing j office director to determine the degree of coordination needed for projects of l less than $100K. This procedure win afford all program offices the opportunity l .j or concur as they feel necessary on the higher value projects. N to comment 4 This concurrence may be obtained concurrently (vice sequentially) and will be 1 indicated within one week of receipt. The absence of a response win be considered a positive response. If a problem or reservation is identified, the 4s\\ nonconcurring office director will provide specific rationale in writing to the h/ issuing office within an additional week. The issuing office is responsible to i

1 N

i 'l

4 PROCEDURE FOR PLACEMENT OF WORK WITH THE DEPARTMENT OF ENERGY NRC-1102-042 m take whatever action is necessary to resolve the problem before the NRC is transmitted to the manager of the appropriate DOE operations Form 173The nonconcurring or commenting office shall work expeditiously with office. the issuing office in resolving the problem. Only after final internal review and coordination, noted above, may an NRC Fonn 173 be transmitted to DOE. l u} This procedure will insure a completed Standard Order of DOE Work does not Under no circumstances will unnecessarily duplicate ongoing.or prior. tasks. j an issuing office break up a program to circumvent this required coordina-Revisions to SOEWs which increase funding by $100K or greater will tion. j i also be processed by this procedure. Additionally, each SOW must have attached a documented justification for placement of new work with DOE. coordination and review procedures will be noted Specific program NOTE:forthcoming NRC Manual' Chapter 1401 and will be complied with, when j in a issued. This may change the above stated requirements. i1 The NRC Form 173 will be filled out by the issuing office in accordance with 1 j the instructions in Exhibit 3. Exhibit 4 is a set of Standard Terms and 3 't Conditions which normally will apply to all standard orders sent to DOE. They do not have to be attached to each order. However, any modification l or deletions to the standard terms are to be noted on the NRC Form 173 and provided as an attachment. Exhibit 5 provides the addresses of the DOE i 1 Operations Office managers. preparation and review prior to issuance of ',S There may be instances when urgently required work does not provide suffi-cient time for proposal In these instances, the standard transmittal letter shall a work authorization. -l include an additional appropriate paragraph as indicated in Exhibit 2. t 3 For specific policy and procedures for obtaining DOE consultant services, see O Chapter NRC 4139, Appendix Part III. Additional requirements of that chap-1 ter must also be met by issuing NRC offices. i 043 Issuing Authority. The Directors of NRC Offices, by receipt of an 'l allotment, have been delegated the authority to incur obligations within a spe-The Directors of NRC Offices as holders of an allotment may

1 J

citied amount. The de- 3 redelegate the authority to designated officials to incur obligations. signated officials to whom such authority has been redelegated must have

j direct financial management responsibility for the execution of important seg-i

?, ments of the Commission program. Consequently, the Director of the appro-fq priate NRC Office or his delegate, as noted above, must sign all NRC 'j 9 Forms 173. 044 Changes. Any change to an existing order (i.e., funding amount, 5. work period, statement of work, etc.) will be accomplished by the issuance of C a new NRC Form 173.

.1

.:p y p u 4, - :- l q. ......o n,.. 9 1979

4 PROCEDURE FOR PLACEMENT OF WORK WITH THE DEPARTMENT OF ENERGY NRC-1102-045 045 Authorizing Financial Flexibility. Reallocation.:( funds between FINS is not authorized unless the issu2ng authority so indicates on the NRC Form 173. If an issuing office authorizes the DOE performing organization to reallocate funds between FINS, the issuing authority of the office will be noti-fied within five days after such an adjustment. To be recognized in the cur-rent year, the adjustments must be incorporated in a Standard Order for DOE Work, signed and dated by both parties prior to October 1. This new NRC l 1 Form 173 will change the amounts per FIN in accordance with the perfoming organization's cost experience. e Issuing offices shall not authorize funds to be transferred between FINS after j the end of the fiscal year without the prior approval of the Controller, NRC. t il 046 Applicability. The provisions of this chapter apply to and shall be I followed by all NRC offices. (DOE has also agreed to these provisions, as 1 noted in paragraph 01.) 047 Exhibits. The exhibits of this chapter provide the procedures, '] foms, and terms and conditions for placing work with DOE. .] 1. Sample Letter and Statement of Work (Request for Proposal) 1 ,l .' i 2. Sample Transmittal Letter for NRC Form 173 ~~. (/.) 3. Sample NRC Form 173 and Instructions for Preparation s; l 4. Terms and Conditions - Standard Order for DOE Work 5. Addresses of DOE Operations Office Managers li E l .i - ;4 ...;j-l -l' i al ~ 43 - aY \\ m ]., ~ f T srp AY N1

4 Exhibit 1 /g.. %'*'o, Page 1 of 5 UNITED 5TATES '~ ' [ ?,, j NUCLEAR REGULATORY COMMISSION E WASHINGTON. D. C. 206Ss . p (date) SAMPLE 'i -l Mr. R. J. Hart, Manager Oak Ridge Operations Office U.S. Department of Energy j P.O. Box E Oak Ridge, Tennessee 37830 1

Dear Mr. Hart:

j This letter is a request for a proposal from the Oak Ridge National Laboratory to provide program support contractual assistance to the Office of Nuclear Material Safety and Safeguards of the Nuclear Regulatory i Commission. The enclosed statement of work details the required work and should be used as the basis for preparing a proposal for submission ...i to this office. Standard terms and conditions for NRC work, as approved by Headquarters, DOE apply to this effort. A copy of these terms and ' li conditions has been furnished your office separately. The proposal i should contain as a minimum the information set forth in Enclosure 2 and y should be submitted in six copies to: 0 C, U.S. Nuclear Regulatory Commission i 4 ..: ( ..l Office of Nuclear Material Safety and Safeguards ,'j *' l Attn: Program Support j ] washington, D.C. 20555 i ] Work under this task (is anticipated to be unclassified.) or (will l 'i require access to and/or the origination of classified information as . J..j indicated on the enclosed NRC Form 187.) g j This request for proposal is not an authorization to start work. l- 'M Authorization to commence work becomes effective upon the Oak Ridge l. Operations Office acceptance of an appropriately executed NRC Form 173. If you have any questions about this request, please contact Mr. Don Loosley on FTS 427-4072. Thank you for your assistance. i p}

i:

l J;3 Sincerely, a.! f.,j} . ',9 William J. Dircks, Direct 6r l Office of Nuclear Material }'] Safety and Safeguards l 5., -J

Enclosures:

J I 1. Statement of Work j.~ g 2. Proposal Content i 7.;tjj 3. NRC Form 187 (If classified) ~.\\ cc: ' ~;%) H. Postma, ORNL YG R. W. Barber, EV/ SED (2) a +

Exhibit 1 Page 2 of 5 1 0 3 i ? STATEMENT OF WORK FOR (FILL IN FIN TITLE, FIN, AND B&R) d . i

.l

1. 0 Background V,j Provide a brief statement to orient the reader to the requirements for the work and discuss any pertinent work previously accomplished.

l

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.] 2.0 Work Required 2 Provide a concise description of the tasks to be accomplished by "j the performing organization. Highlight changes from prior authorized statements of work (50W), if any. ~f .l1 - F.i ~Ei 3.0 Reoorting Recuirements Each program office shall specify its reporting requirements (types a j) This may be of reports, frequency, and distribution) in the 50W.

j accomplished by reference to existing office procedures.

l The report listing shall include, as a minimum, a monthly letter 'i status report and a formal final report to be furnished uponConsulting j .1 completion of the program. The programmatic distribution of reported based on activity level.these documents shall be as spec j y [;.I office.

J.4 Monthly Letter Status Report 3.1 Each month the performing organization shall submit a brief letter the work performed during the status report which summarizes:

j previous month, personnel time expenditures during the previous i y The first month, and costs generated against the work effort. I f.[h! monthly letter status report after program authorization shall , ?f j - include planned monthly rate of expenditures for the fiscal year, if not provided with the proposal and include any changes to prior Other estimates in the proposal schedules or estimated costs. .5 will be corrected at this time to reflect authorized programfor cons jf consonance with the activity level; i.e., report only if activity levels. Exception: .cI If this report is to be made available routinely in the l'.( ( 2 NRC Public Document Room, it shall be treated as an interim occurs. technical report (see 3.2 for procedure). 's" Interim and Final Technical Reports 3.2 j Instructions for the preparation of this portion of the statement of work are provided in the Terms and Conditions of the Standard e l Q' f v T rs l .5' W h 2. 1979

Exhibit 1 ~ Page 3 of 5 t Order for 00E Work, Paragraph 12. List the required reports and specify content and due date, if known. An individual task report may be designated to be either an interim report or final report. 3.3 Environmental Impact Statements i Draft and final environmental impact statements will be published as NRC documents, as required by NEPA. Environmental impact state-ments will follow guidelines for NRC staff generated documents. { (

Reference:

NRC Manual Chapter 3201.) 's 4.0 Meetings & Travel i Consider any required meetings and associated travel requirements for meetings which the performing organization will attend or host. All foreign travel requires identification per NRC Manual j Chapter 1501. 5.0 NRC Furnished Mater;al l Specify any special reports, equipment, or other items to be j (, provided to the performing organization by the NRC and when the e-material will be.provided. If convenient, this information may be l l '.- provided as an integral part of the task definition in Paragraph 2 'I above. ll 6.0 Period of Performance . 1 .. 4 1 Specify the start and completion dates for the work described in this statement of work. Where appropriate, this information should .i be specified for individual milestones, as well as for total effort. q l Mc 7.0 Technical Direction l ~ d Insert name and FTS telephone number of the individusi designated as the NRC technical monitor for this effort. .g' 8.0 Disposal of Property l -1

fj Upon completion of a program or termination of a program, a l

y reconciled report will be developed jointly by DOE and NRC to 22.1 record available material purchased with NRC funds. This' report '.j should be developed as soon as possible after program completion or termination decision has been made, but not later than sixty days A j after work termination date. The report should be submitted to the -W Property anc Supply Branch, NRC. p .,1

)

E

.g Exhibit 1 i Page 4 of 5 f PROPOSAL CONTENT 1 The minimum items required in all proposals are: l$ 1. Performing Organization's Name and Location j 2. FIN Title (as on statement of work) 3. FIN Number 4. B&R Number (NRC's) 5. Performing organization's key personnel, program manager, or t principal investigator, and FTS phone number. j .~...j Background (include previous technical progress if a continuation, 'j 6. and relationship to other projects). -} Work to be Performed (Provide a concise description of tasks to be .I 7. ~ ll performed and expected results for the period of performance. Note technical Identify major subcontracts, including consultants. data requirements, potential problems, and other$ technical infor-71 .4 mation needed to fully explain the effort. Highlight changes from 'j prior authorized 50W's, if any, identify changes in performance, j schedule, or costs). ,' j Costs estimated to be incurred by DOE contractors, subcontractors, ' [J 8. and consultants. (List by fiscal year to completion):

y

,4 Manyears of Technical Support (MTS) .": 4 .) a. a b. Costs: .,. g is Cacta j$ 8 707at 08 Cactal #L ACEo emion f0 fall CATE Wif a f at *EasonM Nc onGANi2 ATiON I ~~ UNCEm Tat SAME ApenOrmsArioN5vv00L AN TwEsim5tpova cacif50s twe j$ S&m NvMeta CITEO ag0vt y l C TOTAL CaCEns TO DATE TOTAL A & g. !5 I C AMovNT INCLUDED iN "C" APPLICABLE TO Tat ' fin NUMBf 4" CITED 8N Tm:5 OmoE n l5 f ~ } {Q' PiNANCI AL F LE XiBILiTY. l (*, *> a.f C 8vNCS W'zto LL NOT gE mEPm0cm AMMED BETwEEN FINS LiNE D CONSTsTUTES A LiMITATiCN CN OsLIGAT'0Nii f1 AvTMOmi - I.! O FUNC5 MAY SE mEPm0CR AMMED NOT TO EXCEED : iC",05 fin LEVEL rP 70 550st LiNE C Co.NSTiTuTES A L.Mif AT'C*. t CN CSLiGATiON5 AUTwomi2ED . ~. j STANCanD TE AMS AND CONosTIONS PROviCEO DCE Amt CONSIDERED #Anf CF TMis OmCEm .j UNLESS OTMERWISE NOTED.

)

'fd f ATT ACMME NTS l a THE FCLLOWiNG ATTACMMENTS AmE ME mEBV SECynetv l +.] l Y ACE A PART OF T>rs OmDEm C v. Cat ON *>is CaCEm 's NOT.*.455i8'E: --) C STATEMENT OF WCmK [ WomK CN Tais cacEn istoL,E5 C. A>5i8st: C 400iTICN AL TEmM5 AND CONosTIONS 8N80mMATics Nec semy ist '$ AT'AC=FO ,,. i ,OTHER ... b4 I %.y a ' REMAmKS Ingrerence the arcoaser bv number and ante ena snareste r!the artsenea statement at were madefies the CCE crocesse t I

M I

d'.8 I s i l l .pt g f.$ j .U i -.'yf l . 1 l Is$UING AUTHORITY i ACCEP*rlNG Cf;GANIZATION t 4 . g.. s. rung sosarwat d l c,.] ..E

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6 a..

7. _., s I

I .Y y' 3 .,7I 7 l %,} l . ~ wo m eJL

_m...... a Exhibit 3 t Page 2 of 4 INSTRUCTIONS FOR PREPARATION OF NRC FORM 173 The following items will be completed by the NRC issuing office: 4 Order No. The order number identifies the issuing office, fiscal year the order is The number is XX-XX-XXX. issued and the sequential number of the order. The first two digits represent the office code, i.e.,10 for Office of The Standards Development, 20 for Nuclear Reactor Regulation, etc. i third and fourth digits identify the fiscal ye'ar in which the order is The last three digits are sequential numbers of the order issued. assigned by the issuing office starting with 001 for the first order .i I placed with DOE for that fiscal year. ',i Date The date signed by the issuing authority. Issued To The name of the 00E office receiving the order. .S Issued By ) l~, The name of the NRC office issuing the order. -i Performing Organization The name ano location of the DOE laboratory, prime contractor, or office 1 -j Provide further identification of laboratory which will perform the work. complex, site, etc., if possible. Identify DOE program manager or l [,.} principal investigator if known. )j. FIN Title .c;d The title on The title should be a concise description of the work. ) this form should be the same as that provided to the Division of Budget, For continuing efforts, titles 's JJ CON, for the Financial Plan Listing. In the event that the generally will not change from year to year. order covers a number of FIN tasks, insert the words "see remarks," then 4 l 3j provide the appropriate lists and remarks. Accounting Citation - Appropriation Use the same appropriation number as that identified on the allotment

]

for current fiscal year funds. For adjustments to prior year FINS, use

J appropriate allotment citation.

.M% I 1 h.a. l q .jl 1 ?q Aggroved: October 2, 1979 l i

Exhibit 3 1 Page 3 of 4 -i B&R Number Show the NRC B&R number under which the order was placed. This should i De the same B&R number as that identified in the financial plan. When l an order covers a number of tasks, insert the statement "see remarks" and add as appropriate. ~1 FIN Number il Show the FIN number which identifies the task and fiscal year of the i funds. The basic number (first five positions) will not change for ,j continuing efforts. (The sixth digit denotes the fiscal year of the funos.) In the case of an order covering a number of tasks, insert the statement "see remarks" and add as appropriate. -l Work Period I i 1 Show the period in which the work is to be performed and funded. Note 'i whether work period is fixed or estimated and check applicable box. If 1 the order is for more than one FIN, insert the words "see remarks" and 'j provide as appropriate. .P Definitions: Fixed means that costs shall not be incurred beyond the j g cited work period. For the work period to be extended a -j i revised NRC Form 173 must be issued. J1 ',. / -'j Estimated means that the exact period of performance is .1 not known at inception of the project. In this instance M the period of performance may be extended without prior yj approval by the NRC. However, when the period of performance is determined, a revised NRC Form 173 will be ..'j issued providing a fixed work period. 4 Obligation Availability Provided By: "3 J. a. This Order - 4,' l .Y Include the dollar value of the order. l -5 l ).) b. Total of Orders Placed Prior to This Date Show the total value of all prior orders this fiscal year placed by q the issuing office to this performing organization citing the same 41 appropriation source and the first four digits of the NRC B&R number Q appearing in the accounting citation. Leave blank for the initial e order in any fiscal year. 'l;i c. Total Order to Date l qg Show the total of a. and b. above. (a '..Fw ,s l l j n...s..

....,........ a. Exhibit 3 Page 4 of 4 m d. Amount Included in c. If the order is for a single FIN, this amount would represent the cumulative year-to-date amount of funds obligated against the FIN. If the order is for more than one FIN, insert "see remarks" and add as appropriate. Financial Flexibility Check the approcriate box to denote level of flexibility the issuing office wishes to grant the performing organization without prior I i notification. ,I Attachments 4 Check the appropriate box identifying the attachments to this order. t f.j Security l '1 l i Check the appropriate box. If classified, complete NRC Form 187 and ] forward to the Division of Security for appropriate concurrence, along f with a copy of the statement of work. I 3 Remarks '.I 'l Use this space for any pertinent information you may want to include. .. /' If the order is for more than one FIN, include the following listing: (1) FIN numbers, (2) FIN titles, (3) NRC B&R numbers. (4) amount of this order by FIN, (5) cumulative amount by FIN, and (6) work periods. If additional cost reporting information is required by the NRC technical monitor, this will be coordinated with the Controller, and noted in the remarks section. (The DOE operations office will accept such requests ., j only if they appear reasonable and the information requested is readily available.)

n. *

jds' Issuing Authority The signature.of the director of the appropriate NRC office or his

s

.i .' j designee must appear in this block. l '[i Accepting Organization <d The signature of the DOE representative authorized to accept the order, 1.) title, and the date of the signature should appear here. Ui t: .!i l c! ?, fN v-i 3 ), n ,r.fi l Approved: October 2, 1979

e Exhibit 4 Page 1 of 21 t TERMS AND CONDITIONS j: STANDARD ORDER FOR DOE WORK

• 1 1.

Security - Unclassified Work Efforts .4 Si To the extent that performance of work under this order does not 1 involve classified information, the following clauses are applicable: 1 (a) It is mutually expected that the activities under this work M orcer will not involve classified information or material. If -} ir, the opinion of either party this expectation changes, they A shall immediately notify the other party in writing. In any ,) event, 00E shall handle and otherwise safeguard classified

)

information and material in accordance with applicable law and 1' 00E requirements and shall promptly inform the Commission in i writing if and when classified information or material becomes 3 involved. y. (b) The DOE contractor (performing organization) shall not permit G any individual to have access to Restricted Data, or other y classified information except in accordance with the Atomic ..g Energy Act of 1954, as amended, and DOE's regulations or i requirements. O dj k'.C^\\ .m ! (c) Except as specifically authorized by this work order or as N'.-]'I otherwise approved by the issuing authority, records or other information, documents and materiais furnished by the NRC in the performance of the order shall be used only in connection .j with the work performed under the order. Upon completion or -lM.d termination of this order, DOE shall transmit to the issuing authority all records or other information, documents and i..] materials and any copies thereof, furnished by the NRC in the l, gd performance of this work order except those required by the 00E Contracting Officer's official records.

<@Q -

d 'M (d) All parties conducting activities under this work order shall , TG. be responsible for the safeguarding from unauthorized disclosure , d.r any information or other documents and material exempt from l i public disclosure by the NRC's regulations and made available ' hi, in connection with the performance of work under this order. M Both parties agree to conform to all regulations, requirements,

j and directions of the NRC with respect to such material.

M ':YA r/ while these terms and conditions are oriented to government owned, , 3 contractor operated facilities (GOCO), they apply equally to govern-ment owned, government operated facilities (GOGO). Examples of f GOGO are the New Brunswick Laboratory (NBL) and the Idaho Radiological 4. Environmental Sciences Laboratory (RESL). m (gj?.k y @qjj Aseroved: OgM@r 2, MR

Exhibit 4 Page 2 of 21 9 2. Security - Classified Work Efforts To the extent that the performance of work under this order involves classified information, the following clauses are applicable: 'i i DOE and the DOE contractor (performing organization) shall be j (a) responsible for safeguarding Restricted Data, Formerly Restricted Data, and other National Security Information and for protecting 4 against sabotage, espionage, loss and theft in accordance with DOE's security regulations and requirements. -j Except as otherwise expressly provided, DOE shall, upon 1 l1 completion or termination of the work order, transmit to the d Commission all classified matter in its possession or in the ,j possession of any person under its control in connection with If retention of any classified performance of this work order. 'l matter is required by DOE, it must obtain the approval of the ] Commission and complete a certificate of possession specifying -] the classified matter to be retained. The Contracting Officer shall ascertain that the 1 Regulations. l (b) DOE contractors conform to all security regulations and lj requirements of 00E. ~ t Definition of Restricted Data. The term " Restricted Data," as -3 usec in tnis clause, means all data concerning (1) design, !.;) j (c) 4. manufacture, or utilization of atomic weapons; (2)_the production of special nuclear material; or (3) the use of special nuclear .1 material in the production of energy, but shall not include '] data declassified or removed from the Restricted % ta category -] pursuant to Section 142 of the Atomic Energy Act of 1954, as dj amended. The term "Formerly Definition of Formerly Restricted Data.

fj (d)

Restricteo Data,' as used in tnis clause, means classified 9,.J' information related primarily to the military utilization of ']$ atomic weapons removed from the Restricted Data category under p. Section 142.d of the Atomic Energy Act of 1954, as amended. l

• si Official 3

Definition of National Security Information. (e) information or material which requires protection against unauthorized disclosure in the interest of the national defense l'. Y.fi or foreign relations of the United States. .J DOE and DOE contractors Security Clearance of Personnel._ J 'i (f) shall not permit any individual to have access to Restricted Data, Formerly Restricted Data, or other National Security ( 6 Information, except in accordance with the Atomic Energy Act 1d) of 1954, as amended, and the DOE regulations or requirements 0 dl ,.2% O t. ^ .a 'J

e Exhibit 4 l Page 3 of 21 .) I aoplicable to the particular type or category of classified information to which access is required. l (g) Criminal Liability. It is understood that the unauthorized 'j disciosure or the failure to properly safeguard Restricted A Data, Formerly Restricted Data, National Security Information, ] or any other classified matter that may come to the DOE or to-any person under a DOE contract in connection with work under i a'j the work order, may subject the performing organization, its ~j agents, employees, or subcontractors to criminal liability under the laws of the United States. (See the Atomic Energy Act of 1954, as amended, 42 U.S.C. 2011 et seq.; 18 U.S.C. 793 ,;j and 974; and Executive Order 12065.) (h) Subcontracts and Purchase Orders. Except as otherwise authorized j in writing by tne Commission, DOE shall insert provisions l similar to the foregoing in all subcontracts and purchase orders under this work order. ,3 3. Classification 1 n j To the extent that the performance of work under this order involves * 'l classified information, the following clause is applicable: "In ..j the performance of the work under this work order DOE shall assure Jj fg that, the performing organization shall assign interim classification ga fi levels to all documents, material, and equipment originated or

d W generated by the performing organization in accordance with classi-

~j fication guidance furnished by the Commission. Each subcontract j and purchase order issued hereunder involving the generation of classified documents, material, or equipment, shall include a ,y, provision to the effect that in the performance of such subcontract jj Q or purchase order the subcontre: tor or supplier shall assign interim jj classification levels to all such documents, material, and equipment d in accordance with classification guidance furnished by the performing -;j organization. The performing organization shall in turn submit ? through appropriate channels all documents, material, and equipment '.' i;. work order for final classification determination. It is the generated under the work order to the office responsible for the Q responsibility of the office originating the work order to ensure W that proper classification is assigned by an Authorized Classifier. M The attached NRC Form 187, Security / Classification Requirement, dated is a part of this order." ] 4. Proprietary Information 1 ik In connection with the performance of work under this o'rder, the A Commission may furnish for DOE review, evaluation, or other use, h certain trade secrets or confidential or privileged commercial or ? financial infornation determined by the Commission to be otherwise exempt from public inspection or disclosure. Such information Oi ?W . i? l J g Approved: October 2, 1979

i Exhibit 4 Page 4 of 21 i shall be submitted in writing to the DOE Contracting Officer (where the DOE performing organization is a DOE contractor) or the DOE Facility Manager (-here the DOE performing organization is a 00E l facility) for approval of the acceptance of tne proprietary infor-mation, and for reaching agreement with the Commission on the limitations, conditions and terms under which the information may be used by the performing organization. I For DOE contracto-employees used as-NRC consultants, proprietary or other privileged information may be provided by NRC on an individual basis with the understanding that it will be protected from disclosure ar.d will be returned to NRC upon completion of the J task. t ll t 5. Work for Others } Notwithstanding any other provision of the work order, the DOE Contracting Officer and 00E contractor agree that placement of this 1) work does not give rise to any actual or apparent conflict of interest from either agency's viewpoint. They further agree that during the period of performance, the contractor will forego I entering into any new contractual arrangement which could give rise to a conflict of interest. The performing organization shall ' l; ensure that all employees designated as key personnel, if any, 1 under the work order abide by the provisions of this clause. The ys DOE organizational conflict of-interest provisions will be used as O ') a a guide in making such determinations. If in the DOE Contracting Officer's view, any proposed r.ontractual arrangement creates a possibility for conflic; of interest, he shall notify the issuing NRC office and obtain their written approval prior to the execution

]

of the associated contract. -u,j 6. Subcontracting sl) The DOE organization shall notify the issuing office reasonably in ..;j:i advance of entering into any major or significant technical service subcontract not contained in the original proposal. " Major or t9.j ~- significant" must be used with judgement and related to the total @I]'I value of the project and/or impact on the results. This advance no'.ification will include: ,l. g f ') (a) A description of services to be called for by the subcontract, L v l. _. " (b) Identification of the proposed subcontractor, i Q (c) The proposed subcontract costs, and 1 .4 (d) A statement that the proposed subcontract will not result in a N]J real or apparent conflict of interest situation. If the NRC i l program office requires additional specific subcontractor l '.f

6. N y

.v[ eM

d

]l a Approved: October 2, 1979

Exhibit 4 Page 5 of 21 information or limitations, those requirements shall be stated on the NRC Form 173. Doe will provide any special requirements such as financial and organizational disclosures for consulting type services. 7. Stoo-work Order (a) The issuing office may, at any time, by written order to the DOE Contracting Officer, require the contractor to stop all, or any part, of the woeK called for by this work order for a period of ninety days after the order is delivered to the l contractor, and for any further period to which the parties may agree. Any such order shall be specifically identified as a Stop-Work Order issued pursuant to this clause. Upon receipt of such an order, the contractor shall forthwith comply with 2' ( its terms and take all reasonable steps to minimize the incur- .a rence of cost allocable to the work covered by the order during the period of work stoppage. Within a period of ninety days after a Stop-Work Order is delivered to DOE, or within any extension of that period to which the parties shall have i agreed, the issuing office shall either: 1 + l (i) Cancel the Stop-Work Order, or ( ,1, m (ii) Terminate the work covered by this work order. t (b) If a Stop-Work Order issued under this clause is cancelled or j the period of the Stop-Work Order or any extension thereof expires, DOE shall authorize its contractor to resume work. i U An adjustment shall be made in the delivery schedule or cost, or both, and the work order shall be modified in writing g accordingly. S

}

(c) If a Stop-Work Order is not cancelled and the work covered by such is terminated in accordance with the terms of this work fi order, costs resulting from the Stop-Work Order shall be .] allowed in arriving at the termination settlement. D 8. Patent Rights .;) ' J.i The statutory, regulatory and procedural patent policies of DOE y will be applicable to the work falling under this work order, ^2 provided however: .,.A (a) Disclosures of inventions conceived or first actually reduced ti to practice under Commission funded work shall be promptly

3 furnished to the Commission together with notice of DOE's Q

intended patent action on such invention; r 9 .. 0 Q\\ f! hf T1 \\ l] Approved: October 2, 1979

s Exhibit 4 Page 6 of 21 -) .s (b) If 00E should determine not to protect such inventions, either demestically or abroad, the Commission shall have the right to protect such inventions; 4 If the technology covered by any invention disclosure upon (c) whien 00E intends to file is deemed by the Commission to fall 1 within the Commission's mission, i.e., relates to nuclear ~! facilities and materials safety, safeguards, and environmental j protection, in support of the Commission's licensing and regulatory functions, the Commission may so notify DOE and a determination will be made by the parties as to which party y will file such patent application or applications; and l In view of the statutory patent policies of DOE and NRC, (d) neither party shall grant any form of exclusive patent rights, i l by waiver or by licensing, without expressea approval of the . f} other party.

9. # patent Clearance In order that public disclosure of information regarding scientific or technical developments arising out of this work order will not j

adversely affect the patent interests of either 00E or NRC, patent approval for release or publication shall be secured from 00E prior . s .{ to the release or publication of any such information. J i. s 10. Limitation of Funds [, The Commission shall not be obligated to reimburse DOE for I (a) costs incurred by its contractors in excess of the total j .] amount authorized by an appropriately executed NRC Form 173. {j NRC will formally notify the appropriate DOE Field Office of any programs they intend to phase out or terminate as soon as ..j such intent is known; preferably, at least 30 days prior to l. .i For programs with fixed per-the proposed terminstion date. j.Q formance periods, the DOE Field Office should assume that the (' T program will terminate on the last day of the period specified ;j in the Standard Order for DOE Work unless notified otherwise. ..j I i If at any time DOE has reason to believe that the costs will f:$ (b) exceed the total amount authorized, DOE shall notify the issuing authority. In the absence of formal NRC instructions 'i .i to continue or to terminate a program, the DOE Field Office (contracting officer or his designee) will notify NRC,, by TWX . I, or other suitable written means, when the accrued costs of any l NRC program approaches 90% of the authorized funding level. l The notification should include estimated date when the accrued l-1 costs will equal the authorized funds, and may, if appropriate, d recommend or recuest NK action desired. The notification .- s .m 'l C f j [ l a

Exhibit 4 Page 7 of 21 should be addressed to the appropriate NRC office, with copy to the NRC Controller, and to DOE-EV-SED. After such notifi-cation, the issuing office will: (i) Increase funding authorization, and/or (ii) Change the scope of work, and/or (iii) Change the period of performance, or (iv) Terminate this work order. (c) If this work order permits DOE to reallocate funds authorized by this order between FIN's, the issuing office shall be notified of such reallocation within five days after such an adjustment. To be recognized in the current fiscal year, the adjustments must be incorporated in an NRC Form 173 signed and dated prior to October 1. In cases where the work period states " estimated," prior

1 (d) notification that work is to extend beyond the period indicated vi is not necessary to completing the assigned work.

s, (e) If the work period under this work order is fixed, the per-I;d formance of work should be completed within that period. Cp.. s 3') However, when it is first anticipated by DOE that the work ^Y ' U cannot be completed within the time period fixed by this work order, the issuing office shall be notified in writing. i' Notification shall occur in sufficient time to allow the issuance of another NRC Form 173 authorizing a'n extension of 1 the work period to such time as is necessary to complete the .j. authorized work. I

T Work shall not be performed beyond the end of the work period

'.' i of this order unless authorized by an appropriately executed ,q/: - NRC Form 173. If the period of performance is not extended, the issuing office will issue an NRC Form 173 to the y appropriate DOE office deobligating any excess funds. v.] ' ) ,i 11. Billing Recuirements f.j 00E will bill NRC monthly for costs reported through the FIS . 'i (a) system by the six position FIN number via separate bills for .4 costs applicable for'each NRC Program Office, (e.g., Standards d Development, Nuclear Reactor Regulation, etc.). fi A The bills will identify the NRC FIN (6 positions) such as (b) 'l A10017, B20016, etc. (the last digit identifies the fiscal O -d year of the funding), the NRC B&R number shown on the NRC } Form 173, and the DOE B&R number.

S

,d p 61 .d Approved: October 2, 1979

Exhibit 4 Page 8 of 21 O (c) The bills will be certified by the DOE field office prior to submission to NRC. The bills, at a minimum, will indicate the month tne costs sere incurred and the dollar amount of those costs. For bills which include aquipment and related material .5 (d) (including sensitive items), an itemized receiving report will be provided to include: 00E Facility Identification (each page) 1 National Item Manufacturer Serial Acquisition Tctal Fin i i Stock No. Description & Model No. Number Cost Quantity Cost No. l (When available) 'j i (e) All bills (SF 1081) shall be issued (original and 5 copies) .i to: 1 U.S. Nuclear Regulatory Commission 'i Office of the Controller Division of Accounting (L 316) Washington, D.C. 20555 3. Any additional billing information to be requested must be so s (f) indicated under the " Remarks" section of the NRC Form 173. -1

q

12. Technical Reporting Reouirements fj The statement of work will specify the technical reporting (a) requirements, including a concise list of reports to be pro-vided by DOE, frequency and distribution.

The minimum reporting requirement is a formal final report to be furnished -i

J upon completion of the work.

Annual reports may be required 1 if the work is to take longer than 16 months. 'Q 1.1 All costs associated with report preparation of camera-ready ,/i copy, printing, and shipping for NRC are to be direct charges 1 to the authorized program involved, and are ng to be included .] in 00E General and Administrative Expenses. Esch report required by the statement of work shall be iden- ..t tified as interim or formal in accordance with the following ij definitions: Interim Contracter Reoorts - Regulatory and technical .i (i) cocuments preparec in accordance with contract or inter-agency agreement requirements for recording plans and .a m y v

)

l g l {t i 3

• aaaaaacA _fM@xar 2,1979 l

t Exhibit 4 Page 9 of 21 Such documents results during the course of the work. may include, but are not limited to, informal progress reports, letter report:;, quick-look reports, data reports, technical status reports, project descriptions, pre-test predictions, model verifications, experiment safety analyses, experiment operating procedures, facility certification reports, and test result reports.* .1 Formal Contractor Reports:- Regulatory and technical .o occuments that record the results of contractor work at (ii) ,Such documents may principal points in the program. include, but are not limited to, qu i annual progress reports and final reports. a 1 Draft and final environmental impact statements, which will be .t Lj published as NRC documents, as required by NEPA, are not DOE subject to paragraph 12 of these terms and conditions j M This variation from the standard terms and conditions must be included in the statement of work. If the NRC program office placing the work desires to give the j principal investigator of the work the option of publ j .j this option will be stated in the statement of work. j .1 [..- Exercise of this option requires that the final draft (sub-y; . $ 'e. sequent to peer review) of the journal article be submitted by J letter to the NRC Division of Technical Information and Document Control (NRC/TIDC) for' processing for accession by d the NRC Public Document Room at the tima it is submitte 3 ] the journal.must be replaced with a copy of.the journal article by sending an author's copy, properly identified, to NRC/TIDC. 1 Each journal article submission must be accompanied by the t Y following statement, "The submitted manuscript has been authored by a contractor of the'U.S. Covernment under contract a ,,,3 Accordingly, tha U.S. Government has a y nonexclusive, royalty-free license to publish or reproduce the number _i published form of this con;'ibution, or allow others to do 50,In add d for U.S. Government purposes." Y carry the statement, " Work supported by the U.S. Nuclear M Regulatory Commission, Office ofwith the U.S. Department of Energy." under Interagency it Agreement 00E 40-55 -75 V.! If requested by the journal or other publisher to transfer the o 5.j copyright, the author shall respond to.the journal or other publisher, in writing, in accordance with the sample letter i shown in Figure 1. a "All tnese documents must carry the title pace shown.n Figure 2. m fm j hp.) .a u., u Approved: Cetober 2, 1979 90

y. 4 4

,t't x Exhibit'4 1( Page 10.of 2' 5 p . 'i Presentation of the results at a technical meet ng may a:so be authorized by NRC. I ~ f ^ (b) Content of Technical Reports The content of technical reports shouin' fcilow generally .f< accepted technical writing practice witt, appropriate flex!bility i, to meet the author's (authors') specific needs. l Progress and final reports should-include an abstract of 200 words or less. The abstract shall summarize the major points of the report results, recommendations and/or conclusions. 1 of work to date. The preferred location for the abstract is ( 't For progress reports, the abstract'should outline the status ? between the title page of the report and the table of co'ntents. The pertinent NRC FIN numbers (s) andsthe t.fficial FIN title (s) i

]

should be placed at the bottom of the abstfact page.'

]

Progress and final reports for all NRC offices except the Office of Standards Development (50) shogld also include a 500 -1 Gi to 1000 word executive summary (one or two'pages) of the major f findings, conclusions, and recommendations (if any) of the H report. The executive summary, labeled as such, should appear j as the first section of the main report on page one, and l . (i should precede the introduction, if any.. j 2 Interim reports for all NRC offices except SD should also 'f include a one page executive summary of th's scoject matter 'I covered in the body of the report. The summary should also be d included in the letter transmitting the report to the NRC l dj technical monitor. Scientific and technical reports should not include administra- ), tive, managerial or fiscal information unsuitable for wice l> dissemination. They should also not include proposals for further support which are to be submiti.ed separately to protect their privacy. g t N.,. c (c) Interim Reports Preparation and Handling d The number of copies specified in the statement of work for each interim report are to be sent to the NRC technical monitor I .,] on the schedule indicated in the statement of work. Two copies and an NRC Form 426A, Publications Release, are to be T sent to the NRC Division of Technical Information and Document d' 'd Control with a title page of the type shown in Figure 2, d unless the NRC technical monitor specifies that'all copies be sent through him. In that case the Technical Fonitor will

/j forward two copies of the report witn an NRC Fcem 426A to NRC,

'Q TIDC for processing into the NRC Public Document Room (PDR). .a' r1 (If an official of the performing organization is authorized :.0 sign the NRC Form 426A, he will be designated by name in the

1,

-].,

statement of work). Aj

t. l l

A ~

i ,? ,/ f/ (j s 1 ./ ' i Exhibit 4 ,e Page 11 of 21 i ,o E s ~ d, Twocopteranc[asignedDOEForm426aretobesenttoDOE Technical Infccmation Center (00E TIC) by the performing organizationc c (d) Fprmal Feoorts Preparation and Handlina 4, ' Forma',J' reports-may be printed for NRC distribution by those .30E tacilities that have: Joint Committee on Printing (JCP), U.S.. Ccngress, authorized' printing plants if the work is being uone for either of[the;following NRC offices: s Office of Nuclear Regulatory Research Office of, Standards Development i j Formal reports will not be printed for NRC if the work is

being done for any of.the following NRC offices:

') "d Office of Nuclear Reactor Regulation 7 Office of Nuclear Material Safety and Safeguards Office of Inspection and Enforcement ' j' Office of State Programs ']% f),- , r

7" c

The principal 00E facilities that perform NRC work and which h u e JCP authorized printing plants are: .4 '/, Ames Laboratory Argenne National Laboratory 4 Brookhaven National Laboratory Grar.d Junction Office Hanforo Atomic Products Operation Idaho National Engineering Laboratory lj 'lQ ~ / Knolls Atomic Power Laboratory - ft Lawrence Berkeley Laboratory ! Lawrence Livarmore Laboratory y Los Ala'nos Scientific Laboratory 'Jg "f,4 ' Mouno Laboratory 0ak Ridge National Laboratory (through K-25 plant) V ~ 1 ] ,Sandia/ Albuquerque Savannah River Plant ] $l M Printed copies or reproducible masters will ce supplied in ) Qj accordance with the following procedures: ,i-(i) Formal Reports Printed at 00E Facilities - The distribution quantity indicated in the statement of work plus reproducible master will be supplied to the NRC Division of Technical ! ' % [ y' ? '

.g.

9 .,s j., Approved: October 2,1979 [ [ _. t

Exnibit 4 Page 12 of 21 S Information and Document Control. When a report is printed for NRC, DOE procedures prevail; however, the j data eliments, shown in Figures 3, 4, and 5 will be .J incorporated in the printed version. See 12(h) for l copies to be retained by the performing organization, i 1 (ii) Formal Reports Printed at NRC - Reproducible masters (camera-reacy copy) for printing and distribution are to ] be sent to the NRC Division of Technical Information and Document Control. The originator may retain up to 25 duplicated copies "for internal use only" prior to j d receiving printed copies from NRC. See 12(h) for copies to be supplied the performing organization. js 1 If publication is to be delayed by NRC to coordinate with program office issuance, this is to be noted both on the NRC Form 426A and the DOE Form 426. If the document is 3' not to be reviewed prior to printing, state on the NRC Torm 426A that accompanies the camera-ready copy when it is sent to NRC Division of Technical Information and Document Control that the document is not to be reviewed i prior to publication. 1 (iii) NRC Form 426A and DOE Form 426 - In all cases a completed fir Form 426A must accompany the formal report. Two +]j copies of all paragraph (i) and (ii) reports and a signed 00E Form 426 are to be sent to DOE TIC by the performing W il organization. - ',1 The reproducible masters must be accompanied by NRC -1 'j Form 426A. If an official of the performing organization is authorized to sign the NRC Form 426A, that official ] will be designated by name in the statement of work. 1 g, d (e) Procrammatic Review of Reports i 'hd The statement of work must indicate those technical reports .,,] - that will be reviewed in draft form for NRC policy, management, "i regulatory and legal issues. After such review the final form .y of the report will be prepared by the performing organization and submitted to NRC/TIDC as reproducible masters or printed 8"j r.opies. , :j, (f) Administrative Review of Reports Patent and security classification review of all reports will be accomplished by the cognizant DOE Operations Office. }1 l 3]

9

,v ? l Approved: October 2, 1979

5 Exhibit 4 Page 13 of 21 (g) Reports Containing Commercial Proprietary Information Proprietary information used in reporting to NRC will be noted on the title page of any report submitted to NRC. ~ (h) Printing and Distribution of Reports All interim and formal reports to be made publicly available will be prepared in accordance with DOE standards for style and format utilizing the performing organization's standard cover, if any, with the data elements shown on Figure 3, and a title page with the data elements shown on Figure 2 for interim reports and on Figure 5 for formal reports. These reports are ,l to be submitted to the NRC Division of Technical Information .f. and Document Control with a completed NRC Forr. 426A. o' Up to 50 copies of all publicly available reports may be retained by or will be bulk shipped to the performing organi-

ation by NRC for internal use of the performing organization.

If the performing organization requires more than 50 copies for internal use, a written justification must be sent to the NRC Technical Monitor, with a copy to the Director, Division of Technical Information and Document Control. The Director, NRC/TIDC, will formally consider the request and inform the technical monitor of the results. This procedure requires a e, -1 L,. j minimum of six weeks. '1 s.../ Sirgle ccpies for specific individuals in organizations other than the performing organization who are not included in the distribution list stated in the 50W may be requested on a j program basis or on a report-by-report basis. The request, with written justification, shall be addressed to the NRC Technical Monitor with a copy to NRC/TIDC. If the additional distribution is approved by the Technical Monitor, the performing organization shall send these copies (if printing is done by .d the performing organization) and address labels for the indivi-i duals to NRC/TIDC, where the distribution will be made along y',j.. with the standard distribution. i (i) Announcement of Formal Reports Formal reports will be announced by the Government Printing Office and the National Technical Information Service (NTIS) g and will be placed on sale by NTIS. q f.. a' -1

j bd j

1 Approved: October 2, 1979 1 3

Exhibit 4 Page 14 of 21 ] (j) Document Identification i All unclassified technical reports will be made publicly j available and will carry an NRC identification number and a j DOE identification number, with the NRC identification as the prime number, as shown in Figures 3 and 5. For interim reports { (see Figure 2), this number will be the computer accession l number and will be added by NRC at the time the document is sent to the Public Document Room (NRC/PDR). For formal reports, the identification number will be assigned by NRC/TIDC. Advance information regarding number is needed and it may be obtained by the performing organf2ation's publication group by ~' 1 calling NRC/TIDC. Commercial: (301) 492-7566, FTS: Access ,i Code + 492-7566. 4 The NRC identification number for formal reports will have the .) ] form NUREG/CR-xxxx. 1j (k) Transmittal of Technical Raoorts to NRC and DOE The transmittal of all technical reports and reproducible A masters of interim and formal reports will be accomplished ~i under an NRC Form 426A and a DOE Form 426. Actual shipment of reproducible masters to NRC shall be by first class mail to the Division of Technical Information and Document Control at l the following address: i United States Nuclear Regulatory Commission Attn: Division of Technical Information and j Document Control J Washington, DC 20555 j Printed reports for NRC distribution shall be sent to NRC by

.t 3

express carrier to the following address: ,,,j J Division of Technical Informatio, and d Document Control United States Nuclear Regulatory t.ommission l' 7920 Norfolk Avenue 0 Bethesda, MD 20014 '. i .1 -l .1 4 .] -g .i n %/ ~., .i ,m

Exhibit 4 Page 15 of 21 f 4 The address for transmittal to DOE TIC is: i l Tech:1ical Information Center United States Department of Energy P. O. Box 62 Oak Ridge, TN 37830 c, s i i l (1) Summary Check List 1 The check list presented in Table 1 gives guidance on the j actions and requirements for technical reporting. J, IJ

,j:,

" k

,,,),

a1 / il l 1 i I

• 1 i

)

't

• 5h -

i .' ') i %l ...+:] .s, ..) y ..i f /* f : '.. '% D [H Approved: October 2, 1979 J

Exhibit 4 Paga 16 of 21 Table 1 Technical Reportina Actions and Recuirements" i Interim (informal) 1j Actions and Neovirements Reports Formal Reports f NRC Form 426A yes yes t 00E Form 426 yes yes j ,] Copies to NRC Program Office See statement of work 4 preliminary Copies to NRC/TIDC 2 with NRC Form 426A Sufficient printed 'I reports for NRC distribution and ~' reproducible masters or only reproducible masters (camera-ready i copy) with NRC Form 426A (see Statement of Work) g .] Copies to DOE / TIC 2 with DOE Form 426 2 ) I Available NRC Public \\ Document Room yes yes Available DOE / TIC yes no 1 d Available NTIS no yes .i .1 Oraft Review Specified in Statement Specified in ,i of Work Statement of Work a

d Patent Review yes yes t

,l ' Classification Review 4 yes yes ,i Proprietary Material Review yes yes 4 1 ,-i

)

ig "inis taole coes not apply to draft and final environmental impact t; statements. f.1 i ..i 3 i. .1 U .mJhe9amse_JL1M_

Exhibit 4 Page 17 of 21 i ~;.~. FIGURE 1 I Sample Letter on Copyright Agreement 4

==Dear

==

We recently received a document for signature assigning copyright and j republication rights in the submitted article (title) to (name of } This letter is offered in lieu of the document as a means publication). i of completing the transfer of ownership. Accordingly, we hereby expressly j transfer and assign our rights of ownership in the above cited work to (name of publisher). j You are advised, however, that the above assignment and any publication G,j / or republication of the above cited work is subject to the following Government rights: l The submitted manuscript has been authored by a contractor (grantee) 1 of the U.S. Government under contract (grant) No. <i, Accordingly, the U.S. Government has a nonexclusive, royalty-free T-license to publish or reproduce the published form of this j contributior., or allow others to do so, for U.S. Government purposes. i In addition, each article which results from the placement of NRC work . ) f.,., } with 00E must state " Work supported by the U.S. Nuclear Regulatory j 'jV Commission, Office of under Interagency Agreement with i ';3 the U.S. Department of Energy." ,j ti Sincerely, 'i d -l) .4 'q.. q .,3 1 rd

-i

1 m

9 a,j 'l -l l Approved: October 2, 1979

tahibit 4 Page la of 21 N PlQURE 2 CAMPLE TITLE PACE FCR INTERIM CONTRACTOR DCCUMENTS TO DE MACE.'UBLICLY AVAILABLE s INTERIM REPORT .l Accession No. Accession No. 'j (Will be added by NRC) ' I. %.itr_u_ tor's Report _N_o.. Title of Program for Contract Program or Proiect Title Which Contract Written ' t Limited Subject of Souiect of in's Document. This Document 't'i Type of Document: Tm of Comme -] Status Report. Quick. -j Look Report. etc. '.q lndividuel Awthortsl:

9. ;

i ~ Date of Document. ? N Resoonsseie NRC Inonvia-ai ana NRC Office or Division. s sf . rt This coc.,reent was prepared prirmarity for oreliminary or intereal use. It nas not d received fwll revisa and approval. S.nce tnere rmay be s cstantive ceanges this f doewment snowid not ce consicereo final. UN ,Q-dentractor and Oak R;cge Natenal Lacoratory Cak A cee. Tennessee 37830 '.i'.} jga ,.4 coeratec oy - i-I Union Carede Corporaten I', for the U.S Department of Energy f.-i ' h.'()j s mr.oa,ea for q U.S. N.ctear Reg.latory Commission Wasnington. 0.C. 20555 .; 3 "r 1 Uncer Intera;eacy Agreewent DCE a0 550 75 NRC FIN No At2347 ) NRC FIN Number g INTERIM REPORT i.s 'J. ,s 4 \\ .1 y 1 hj

1. hlaerv+m 51___SLRS2R

f 1 Exhibit 4 l Page 19 of 21 s FIGURE 3 SAMPLE COVER FOR UNCLASSIFIED FORMAL REPORTS PREPARED UNDER OR PURSUANT TO INTERAGENCY AGREEMENTS NUREG/CRG60 l NRC Report No. i Contractor Report No. ,( Vol., Part, Rev., etc.

_ _

A Review of The Application of Strategic Analysis riti. to Material Accounting j A Consensus Report by the Peer Review Group { /,- ?3 Type of Report I,D. ; or Subtitle I 1 e Z - _'Z__ _._ _ _~Z _ C Z_ Z -~._~_ l ~ T - Z ~_.T-Z -- i Argonee Natow motorv Auttior(s), Edator(s) U. 5 Nucieer Requietory b Contractor commenen Sponsorship 3'., 1 '1 l i ti ) 6% u

Exhibit 4 Page 20 of 21 N FIGURE 4 Dl8CLAIMEM AND AVAILABILITY STATEMENTS (BACK OF COVER) NCT!:I o This repert was prepared as an account of werk sponsored by an agency of the Urated States Government. Neither the United States Government nor any agency thereof. or any of the:r empicyees, makes any warranty. expressed or implied, or assa..es any le;a! liabdity or resp:nsibdity fer any thard party's .1 use. er the results of such use, of any information. apparatus preda:t cr process daclosed in this report. er represents that tu une by such third party would not ininnge pnvately cwned i ~..) n;ht: '.s 5 4 .. -.s ] ) 1 .s I ? 4 .I5 a.m ~.;; t %.1$

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Exhibit 5 Page 1 of 1 i SAN AL Manacer Manager Albucuerque Operations Office San Francisco Operations Office U.S. Ce::artment of Energy U.S. Department of Energy P. O. Box 5400 1333 Broadway, Wells Fargo Bldg. Albuquerque, New Mexico 87115 Oakland, California 94612 i CH SR i Manager Manager j Chicago Operations Office Savannah River Operations Office U.S. Department of Energy U.S. Department of Energy TI 9800 South Cass Avenue P.O. Box A 'j Argonne, Illinois 60439 Aiken, South Carolina 29810 NV I ID 1 ,1 Manager Manager Idaho Operations Office Nevada Operations Office U.S. Department of Energy U.S. Department of Energy ]a 550 2nd Street P.O. Box 14100 4 Tdano Falls, Idaho 83401 Las Vegas, Nevada 89114 't i r~ 3 OR GJ 'N k ) 1 Manager Manager -l Oak Ridge Operations Office Grand Junction Office U.S. Departmart of Energy U.S. Department of Energy ai Post Offica Box E P.O. Box 2567 ..j Oak Ridge, Tennessee 37830 Grand Junction, Colorado 81501 -[. Manager fj Richland Operations Office %q U.S. Department of Energy 0 P.O. Box 550

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• THE COMPTROLLER GENERAL

.w . t CF THE U N ITE D STATEG DECISION 1 ( Q f W A S HIN G T O N. D.C. 20548 m.... .T FILE: B-185843 DATE: July 1, 1976 MATTER OF: Columbia R'esearch Corporation DIGEST: ( y 7 1. Where offeror's proposed project manager and principal O,i, / investigator would be in position of evaluating adequacy and applicability of reU^iMty standard which he originated under j l prior contract, agency's rejection of such proposal as not within the competitive range pursuant to unweighted evalua-tion criterion dealing with conflicts of interest is sustained. u l-Since major proposal alteration would have been required to l climinate conflict, it was not unreasonable to reject proposal without negotiation. h 2 Contracter's cost estimate should not be considered controlling h in sc1ceting centractor for cost-reimbursement type contract. p' ~ 3 Even if protester's allegation regarding change in agency's requirements during negotiations with other offeror is ' correct, y rejection of protester's proposal without negotiation is not objectionable since rejected offer was outside competitive range for reasons which remain basic to procurement.

4. Although awardee performed literature search in support of another firm's prior contract to develop reliability ctandard and such standard was to be evaluated under awardee's sub-i I-sequent contract with agency, no objectionable conflict of interest is perceived in award of subsequent contract. In addi-

~ j tion, conflict of interest is not apparent from fact that awardee's board of directors includes individuals involved in regulated industry generally affected by centract and fact that awardee has had prior dealings with firms in such industry. 1 l

5. Allegation, filed after contract award, that consideration i

should have been given to issuance of requirement as small business set-aside is untimely filed and therefore dismissed. .' t I i fo _________________________2_______.__________.._._.__.___ J

/' .\\ ( ~ B-185843 ? .3 ps is a protest filed by Columbia Research Corporation (Columbia) under request for proposals No. RS-76-12, issued by the'.U.S Nuclear Regulatory Commission (Commission). 4 The procurement stems from the Commission's review of. i an application for a permit to construct the Clinch River Breeder Reactor, a Demonstration Liquid Metal Fast Breeder Reactor. The applicadt has submitted a Preliminary Safety Analysis Report which contains technical information related to the design and - construction of the facility and which serves as a primary source of information in assessing the radiological health and safety and environmental aspects of the preposed facility. The instant 3 negotiated ' procurement was initiated to satisfy the Commis-sion's need for technical assistance by an independent contractor in reviewing the Clinch River applicant's Reliability Program. The procurement was negotiated and contemplated award'of a cost-plus-fixed-fee contract. Proposals were to be evaluated by numerical and narrative scoring techniques against certain evaluation factors listed in their relative order of importance. On the basis of the numerical scoring of the weighted evaluation i: factors, the evaluation panel determined that three firms, includ- ~ l[ ing the protester,. could be considered to be within the competitive range. However, the solicitation also contained certain' unweighted additional criteria which were to be considered in the selection process, including the contractual and organizational relationships ~ which might give rise to an apparent or actual conflict of interest. (The Commission believes it is not possible to weight this factor to properly account for the infinite range of conflict of interest i situations which may exist.) The panel ultimately decided to elimi-jx nate Columbia from the competitive range because of an organiza- ~ i tional conflict of interest. It determined that Columbia would be } placed in a conflicting role of evaluating a reliability standard l included in the Clinch River Preliminary Safety Analysis Report which Columbia's principal investigator had developed. It was I concluded that such a situation could affect the firm's ability to i render independent, unbiased judgment and advice to the Commis-Ion. The panel believed that this conflicting role could not be eliminated without a major revision of Columbia's proposal. Essentially, the protester believes that the solicitation's evaluation criterion concerning conflicts of interest may have l been misapplied in excluding the protester and that this criterion l was erroneously applied in selecting NUS Corporation (NUS) for awar,d. Columbia aueges that it was improperly denied the I opportunity to negotiate and to submit a best and final offer, as l , s I.....,.. U n

s (- (. l-a. ~ y ^ E-185843 ? contemplated in Federal Procurement Regulations (FPR) 51-3.805-1. The protester believes that negotiations would have been beneficial to the Government and that an award to Columbia would have resulted in a $14,974 savings, the differen'ce between its offer and the award price. Regarding the rejection of its proposal, Columbia argues that there is no conflict of interest when an individual who has-participated in,the preparation of a Government standard assists' the Governmengin judging the degree to which an applicant had ~ conformed to that standard. The firm contends that such i individualis highly qualified to ascertain the degree of compli-ance of third parties by virtue of the individual's exposure. However, the Commission was unwi1Wg to permit the originator } of a reliability standard to evaluate for the Commission me. i adequacy and applicability (among other aspects) of that stand-i ard. In this connection, the solicitation's statement of work pro-vided in part: s " TASK 2. * * *The contractor shall perform independent reliability analyses for these critical .j areas, taking into account the scope of this con-tract. The analyses will be based on, but not limited to, the data in the (reliability standard, among other documents]." Contrary to the protester's understanding, the conflict as explained j bythe Commission did not concern the originator's evaluation of compliance with the proposed reliability standard. Rather, the Commission reports that although this reliability standard has been-adopted by the Energy Research and Development Administration, it has not yet been accepted by the Commission and its acceptability for purposes of compliance with its licensing regulations must still 4 be determined through this review process. In our opinion, it was not unreasonable to perceive a conflict in Columbia's proposal since j analysis of the reliability standard would have been performed by ] the originator of that standard. ] In addition, we find no basis for objecting to the Commission's conclusion that the conflict could not be cured without replacing the i individual involved and to its unwillingness to permit the major pro-i posal alteration required to correct the situation. Since this. indivi-dual was proposed as project manager and as principal investigator, it was not unreasonable for the Commission to reach this conclusion. As to the significance attributed by Columbia to its lower estimated cost of contract performance, generally that fact should not be considered controlling in selecting the contractor for a cost- ) reimbursement type contract. FPR S 1-3. 805. 2 In this connection, i m.

I c ( o B-185843 t h we also note that in rebuttal to the agency report, Columbia questioned whether the Government's specification was revised during'this procurement because of the cost increase negotiated with NUS. Although the record does not indicate the basis for the negotiated increase in cost, we would not in any event object to th'e rejection of a proposal without negotiation even if requirements were changed where, as here, the rejected offeror is considered to be outside the competitive range for reasons which remain basic to the procurement. Iroquois Research l Institute, 55 Comp. Gen. (1976), 76-1 CPD 123. For tne reasons stated, it does noGppear that negotiations with Columbia would have served any useful purpose. s.. ~; Columbia also argues that the contract should not have been awarded to NUS because of a conflict of interest with that firm. The contractor, it is alleged, has obtained substantial revenues. - through its participation with applicants in the prept. ration of reliability or safety programs for submission to the Commission. It is further argued that NUS has had long standing identification and business dealings with the utility industry, of which the license applicant is a member. Columbia also questions the objectivity of NUS since the contractor's board of directors in-cludes two retired chairmen of utility companies and the Execu-t tive Vice President of a construction firm with a substantial interest in the construction of nuclear power plants. The Commission recognized that NUS has had numerous ' relationships with various organizations in the nuclear industry. It reports that NUS was under contract for less than $10,000 with General Electric Company to conduct a generalliterature . search pertaining to reliability failure rate data to be used by 1 General Electric in support of its role as contractor to the l applicant for the Clinch River Plant..During negotiations the firm advised the Commission that it would not enter into any i additional contracts with General Electric, or with any other j organizations, for work on the Clinch River Plant which would result in a conflict of interest.- The Commission reports that It examined and evaluated the contractual relationship between NUS and General Electric. It considers its contractual relation-ship with General Elcetric as being remote from the substance of the work to be performed under the proposed contract and has concluded that this appearance of conflict is insignificant and too theoretical to warrant exclusion from the competitive range. It is aware of no current relationship, contractual or organiza-tional, which would place NUS in a conflicting role and might I result in biased judgment or advice under the h1stant contract or give it an unfair competitive advantage. i 3' ~4-J e

( ( [- N ~. ~ B-185843 ? \\ We ind the Commission's position to be persuasive since it appea(r.s that NUS's involvement with General Electric in the Clinch River project was in the nature of a literature search and support function and that NUS was not ultimately responsible for the reliability standard included in the Clinch River Pre-11minary Safety Analysis Report. As to the firm's prior busi-ness dealings with firms included in the utilities and nuclear power industries and the composition of its board of directors, we are not persuaded that such general considerations would. call into question the oofectivity of the firm's management in the absence of some more direct conflicting connection with the instant contract. 2 Finally, Columbia has objected to the Commission's alleged i failure to determine the availability of the required services from small business concerns. The record, however, shows that a number of small business concerns submitted proposals for this procurement and each, including the protester, was evaluated by the Commission. To the extent that Columbia pro-tests the Commission's refusal to permit a small business set-aside, the protest is dismissed as untimely raised since our Bid Protest Procedures require that any protest based upon an alleged impropriety apparent from the solicitation prior to the closing date for receipt of initial proposals must be filed prior to such date. 4 C.F.R. 20.2(b)(1976). In this case, the protest was filed after Columbia's proposal was rejected and this allegation is therefore dismissed as untimely filed.. ~ ~ Accordingly, the protest is denied. /% k ' M Deputy Comptro 'er General of the Umted States e \\ e g j 1 _ ',. .}}