ML20065H560

Brief in Support of Exceptions to ASLB 810827 & 820727 Partial Initial Decisions Re Mgt Issues & Reopened Proceedings

ML20065H560
Person / Time
Site:	Three Mile Island
Issue date:	09/30/1982
From:	Bradford L, Doroshow J THREE MILE ISLAND ALERT
To:	NRC ATOMIC SAFETY & LICENSING APPEAL PANEL (ASLAP)
References
NUDOCS 8210050176
Download: ML20065H560 (93)

Text

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,i e ~o c 000HETED USHRC UNITED STATES OF AMERICA .,

NUCLEAR REGUIA'IORY COMISSIm '82 DCT -4 P1 :31 CFF:CE CF SECRETAN

BEEDRE THE A10MIC SAFETi AND LICENSING APPEAL h$khbh'rf In the Matter of. )

)

ME. T BOPOLITAN EDISN COMDANY ) Docket No. 50-289

) (Restart) >

(Three Mile Island Nuclear )

Station, Unit 1) )

'IMIA'S BRIEF IN SUPPORP OF EXCEPTIONS l 10 PARTIAL INITIAL DECISICNS OF i AUGUST 27, 1981 AND JULY 27, 1982- i' MANAGEMENT ISSUES AND RBOPENED PROCEEDINGS THREE MIIE ISLAND ALERT, INC.

IDJISE BRADFORD  !

JOANNE DOBOSHON 315 Peffer St.

Septmber 30, 1982 Eiarrisburg, PA 17102 i

InterVenors

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! 8210050176 820930 PDR ADOCK 05000289 G PDR

t a o t-TMIA'S BRIEF IN SUPPORT OF EXCEPTIONS TO PARTIAL INITIAL DECISIONS OF AUGUST 27, 1981 AND JULY 27, 1982-MANAGEMENT ISSUES AND REOPENED PROCEEDINGS Table of Contents

. . . . . . . . . . . . . . . . . . . . . . . . 1 I. INTRODUCTION II. MAIN PROCEEDINGS . . . . . . . . . . . . . . . . . . . . . . 2 A. The Licensing Board's Conduct During the Main Proceedings Amounted to Arbitrary and Capricious Conduct, and a Violation to the Due Process Rights of TMIA, and l 2 l Prohibited Proper Development of the Record. . . . . . .

B. Due to TMIA's Lack of Resources and Arbitrary Board '

Rulings, Proper Development of the Record on TMIA Contention 5 was Impossible. . . . . . . . . . . . . . . 3

1. The Board's Arbitrary Rejection of TMIA Evidence, and Biased Statements on the Record Prejudiced TMIA's Case on Deferred Safety-Related Maintenance. . . . . . 4 i

2. The Board's Conclusion that no Evidence of Deferred Safety-Related Maintenance or Repair was Produced, is Arbitrary and Capricious. . . . . . . . . . . . . . 7

3. The Board's Conclusion that the Licensee's New Priority System for Completing Maintenance Work is Satisfactory, is Arbitrary and Capricious, and Unsupported by the Record. . . . . . . . . . . . . . . 9

4. Licensee's Past Record-Keeping Problems have '.ot Been Corrected, and the Board Errs in Arbitrarily Support-ing Restart Despite Acknowledged Problems.. . . . . . 11

5. The Board's Shoddy Treatment of Questions Raised by TMIA's Evidence of Excessive Overtime at TMI-1 is Arbitrary and Capricious, and Contrary to Law. . . . . 14 C. The Board Does Not Resolve the Following Board Issues

' to Provide Reasonable Assurance that Licensee Management is Capable of Safely Operating TMI. . . . . . . . . . . . 18

1. The Board Fails to Resolve Board Issue 1 to Provide Reasonable Assurance that Licensee's Management Structure is Appropriately Organized to Assure Safe Operation of Unit 1. . . . . . . . . . . . . . . . . . 19 l

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2. The Board Fails to Resolve Board Issue 6 to Provide Reasonable Assurance that Financial Considerations will not have an Improper Impact on Technical Decisions. . 22

3. The Board Fails to Resolve Board Issue 10 to Provide Reasonable Assurance that Licensee has Corrected all 23 Management Problems Revealed by the Unit 2 Accident. . .

. . . . . . . . . . . . . . . . . .. . . 30 III. REOPENED PROCEEDINGS .

A. The Board's Decision can not be Used as a Basis to 30 Support Restart. . . . . . . . . . . . . . . . . . . . . . .  :

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I B. Cheating and Wrongdoing at TMI was Far More Widespread than Recognized by the Board, and the Board Erred in f Reversing the Findings of the Special Master. . . . . . . . 31  !:

1. The Board's Reversal of Judge M11ho11in's Findings on '

TMI-l Manager of Operations Michael Ross, in which Judge Milho11in Found that Ross Improperly Kept the [

NRC Proctor out of the Exam Room During the April l' 1981 Licensing Exam, and Improperly Broadened the Answer Key, is Arbitrary and Capricious and Contrary l to Law. . . . . . . . . . . . . . .. . . . . . . . . . , 32 L

a) The Board Errs in Reversing Judge Milho11in's Findings Which are Entitled to Great Weight. . . . . . 33  :

i b) The Board Errs in Reversing Judge Milho11in's Finding that Ross Deliberately Kept the Proctor ,

out of the Room to Facilitate Cheating... . . . . . . 34 i c) The Board Erred in Finding that Ross did not Improperly Broaden or Attempt to Broaden the Answer Key. . . . . . . . . . . . . . . . . . . .. . 38

2. The Board Erred in Reversing the Finding that Mr. Husted, TMI-l Training Instructor, Solicited an Answer from P During the April 1981 NRC SRO Exam. . . . . . . . . . . 39 1 The Board Erred and Violated Due Process in Relying on Evidence Outside the Record to Exonerate MM. . . . . . 41

4. The Board's Conclusion that W Copied from GG is i Unsupported and Prejudicial to TMIA. . . .. . . . . . . . 42

5. The Board Errs in Not Finding That U Stationed Himself Outside the Exam Room to Aid Candidates in Answering Questions.................................... 43 C. The Quality of the Testimony Rendered by Licensee Witnesses Included Untruthful Statements From the Upper Management Down to the Lowest Level of the Operating Staff, and was so Poor That it Evidenced an Unmitigated Lack of Respect for the Ent ire NRC Process, and a Severe Lack of Integriti by the Whole 47 Company.....................................................

. e s

1. The Board Errs in Failing to Recognise or Attach Significance to the Non-Credible Testimony Given by Robert C. Arnold, President of GPU, in Connection with the 1979 VV/O Incident.......... .................... 47

2. The Record is Replete with Other Examples of Non-Credible Testimony Evidencing Extreme Disrespect for the NRC Process by Company Employees . . . . . . . . . . . . . . . . . . . . . . 49 ,

In the Board's Recommended Sanctions Against Licensee f D.

Personnel Involved in Wrongdoing, the Board Errs'in Failing to Attach Significance to Evidence on Integrity 51 and Attitude Problems of Licensee Personnel..................

E, The Board's Belief that Probably Almost all, Perhaps all of the Cheating of Any Important Relevence to This Proceeding has Been Identified............................... 57 i

F. The Board's Response to the Cheating Episodes and Licensee's Training and Testing Deficiencies, Consist of Imposition of a QA/QC program, Which Includes Independent Audits Throughout a Probationary Two Year Period of Licensee's Training and Testing Program, Ordering the Establishment of Traihing Instructor Qualification Criteria, an Internal Auditing Procedure, and a Procedure for Reviewing NEC, Exam, Answers to-Detect for_ Cheating, do Nothing to Correct the Substar.tia'l Problems in Licensee's Training and Testing Program Revealed by These Proceedings. . . 59 666 IV CONCLUSION........................................................

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i TABLE OF AUTHORITIES COURT CASES Dolan v. Celebrezze, 381 F.2d 231 (2d Cir., 1967)................ 34 Moraan v. U.S., 298 U.S. 468, 480 (1936)......................... 42 National Airlines. Inc. v. C.A.B., 321 F 2d 380, 383 (D.C. Cir.1963)............................................ 7 N.L.R.B. v. Redmont Waaon and Mfc. Co.,

176 F 2d 695 (4th. Cir. 1949)............................. 35 I y

N.L.R.B. v. Remington Rand, 94 F 2d 862 (2d Cir. 1938)........... 41 Office of Communication of United Church of Christ v. Federal  !

Communication Commision, 359 F 2d 994, 1007, (D.C. C ir . 1966)..... 1 Republic Aviation Corp. v. N.L.R.B., 324 U.:. 793, 800(1945)..... 42 Seacoast Anti-Pollution League v. Castle, 572, F Cd 872, cert, den. 99 S. Ct. 92 (1978)............................ 42 S.E.C. v. Chenery Corp., 318 U.S. 80 (1943).................... 8,41 Universal Camera Inc, v. National Labour Relations Board, '

340 U.S. 474, 496 (1951).................................. 34 .

U.S. v. Pierce Auto Freight Lines, 327 U.S. 515 (1946)........... 42 Ward v. N. L.R .B. 462 F 2d 8, 12 (5th. Cir. 1972)................. 34 Willaport Ovsters, Inc. v. Ewing, 174 F 2d 676 (9th.Cir- 1949)... 41 NRC CASES Duke Power Co., ALAB-255, 4NRC 397 :(1976)................... 30, 38 OTHERS A t om i c E n e rg y A c t . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Commissions Order and Notice of Hearing, CLI-79-8, 10 NRC 141 (1979)................................. 2. passim.

Commission Order, CLI-80-5 (6 March, 1979)................. 2, 3, 7 I E Circular 80-02............................................... 17 Licensee Administrative Procedure 1?C6........................... 63 Licensee Preventive Maintenance Procedure U-17. . . . . . . . . . . . . . . . . . . . 63

Memorandum and Order dated March 25, 1980 ......................... 3 .

NRC Staff's Consolidated Reply to TMIA's Motion For  !

Extension of Time and Waiver of Page Limitations and  !

Mo t ion t o Su s pend B ri $ fing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 3 l NU REG - 0 6 0 0 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . l I

NUREG-0760................................................. 1, 24, 25  !

Report of the President's Commission on the Accident at Three Mile Island (Kemeny Commission Repor'~)...... ............ 1, 5 Report of the Special Inquiry Group (Rogovin Report) * . . . . . . . . . 1, 23 Report of U.S. House Interior Committee (Udall Report) ..... 1, 24 25 i

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UNITED STATES OF AMERICA NUCLEAR REGUIAIORY COMMISSION i BEFORE THE A'IOtHC SAFEIY AND LICENSING APPEAL IDARD In the Matter of )

)

METROPOLITAN EDISON COWANY ) Docket No. 50-289 l

)

Three Mile Island Nuclear )

(Station, Unit No.1) )

DIIA'S BRIEF IN SUPPORT OF EXCEPTICNS i i

'IO PARTIAL INITIAL DECISIONS OF i AUGUST 27, 1981 AND JULY 27, 1982-MGVEMENT ISSUES AND REOPENED PROCEEDINGS I. INrBODUCTION Questions concerning Licensee managcment's ability to safely operate 'IMI-Unit 1 contributed heavily to the Comnission's July 2,1979 decision to order 'IMI-l's operating license suspension. Virtually every investigation into the 'It1I-2 accident, including the NBC Staff's investigation, NUREG-0600, the Staff's investigation into information flow, NUREG-0760, the Report of the Special Inquiry Group (Rogovin Report), the Report of the President's Ocxmtission on the Accident at three !1ile Island (Kcmeny Ccrnission Report), and Congressional reports (Udall Ccutmittee Report; Hart Ccruittee Report), bas blamed Met-Ed managanent for contributing to the severity of the accident, and in particular, for creating conditions at r.he plant which caused the accident to occur.

As the D.C. Circuit noted in Office of Qatmunication of United Church of Christ  ;

v. Federal Ccmnunication Ccmnission, 359 F.2d 994,1007, (D.C. Cir.1966) , "[w] hen past performance is in conflict with the public interest, a very heavy burden rests on [a] renewal applicant to show how renewal can be reconciled with the public interest." That case cone'rned the renewal of an F.C.C. license. It is certainly even nore compelling that when a utility who has been given the awescxne privilege and responsibility of running a nuclear power plant, abuses that privilece by risking the health and safety of hundreds of thousands of people causing its license to be suspended, a very hgavy burden must rest on the licensee to show how lifting the license suspension can be " reconciled with the public interest."

.o-Licensee has not ccrne close to noeting its burden regarding managemnt issues in this i

case. Consequently, the PIDs, developed frun the evidence on this record, are {

l entirely inadequate to sustain an ultimate conclusion supporting restrart. Indeed,  !

the PIDs continually contradict the record, mntinually contradict the findings of the Special Master who presided over the reopened proceedings, and continually ccntradict thcrnselves. in addition, the PIDs fail to resolve issues specifically mandated for consideration by the Ccnmission's Order and Notice of Hearing, CLI-79-8,10 NBC 141 (1979), (" August 9 Order") , and Order, CLI-80-5, (" March 6 Order") .

II. MAIN PIOPFFnINGS A. The Limnsing Board's conduct during the main proceedings amounted to arbitrary and capricious conduct, and a violation to the due process rights of 'IMIA, and prohibited proper develognent of the record. Exceptions 12,42, 23, 83.

12. The Board errs in 5 97 in blaming DfIA for its inability to cross-examine Mr. Manganaro.

42. The Board erred in relying upon Staff testimony in 1314 in that the Staff was inherently biased against TMIA's position and did not properly perfan its independent regulatory function at the hearing, and misinterpreted the hearing issues and law.

43. The Board was implicitly and explicitly biased against the intervenors, exhibited by ccmmnts on the record, and in affording continual deference to the Licensee and Licensee witnesses, to the prejudice of the intervenors in general, 'IMIA in particular.

83. The Board violated due process, was grossly arbitrary and unfair, and violated its legal obligation in finding fault with intervenors for making findings on issues for which they were not present to cross-examine, or for not cross-examining on Board issues with which the intervenors had no ccntentions.

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It is impossible to tackle the substantive content of the first PID without l 6

l simultaneously addressing the underlying failures of this hearing process. The obsta-l cles placed before 'IMIA throughout these hearings created a hearing process so chame-fully deficient as to anount to a flagrant denial of basic due process.

The Licensing Board's terse references throughout the PID to 'IMIA's " failures" as an intervenor whether concerning presentation of 'IMIA contention 5, H 278, or in cross-er. amination, 97, or even in not pursuing Board Issues, H 491, pointedly illustrate the Board's callous disregard for 'IMIA's hardships. TMIA did not " fail" as an

intervenor. The hearing process itself, however, was a fiasco.

It was clearly the Board's responsibility to insure that procedural due process required by law was accorded all parties. At a mininun, concepts of procedural due process prohibit an adjudicatory Board frcxn making a party's participation in the i hearing process so extraordinarily burdensme that it, in effect, precludes that party l frcxn participation. In this case, the Board did just that.

To begin with, there were such a wide imbalance of resources beween the 'IMIA and l the opposing Licensee and Staff, that effective participaticm by 'IMIA was herapered frtxn the outset. The proceedings pitted the Licensee's well-financed and experienced. counsel who were able to vigorously participate at every step on every issue, consistently suppwled by the NBC staff whose perspectives were without excpetion limited by the information available to then via the utility, clearly not perfming their independent regulatory function, against, first, 'IMIA's inexperieced, inexpert, and practically unfunded counsel, and then against a volunteer member of 'IMIA with no scientific, legal training, thrust in the midst of a ccmplex ongoing hearing whm TMIA's counsel were forced to withdraw. Rather than attenpting to level this imbalance, however, the Board actively made.it worse.

B. Due to 'IMIA's lack of resources and arbitrary Board rulings, proper develognent of the record cn 'IMIA Contention 5 was inposible.

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20. The Board erred in the method by which 'IMIA was forced to present its case on 'IMIA Contention 5, as described in 9 278. }

22. The Board violated due process in not appointing an independent expert to l assist 'IMIA in the developnent and presentation of 'IMIA 5, or making the Staff f i

available for technical assistance contributing to the arbitrary rejection by the l l

Ibard of 'IMIA work request exhibits.

The Board was well aware that TMIA could not afford technical assistance or help. They recognized this handicap and its possible consequences early in the discovery phase of the proceedings. In its Menorandtzn and Order dated March 25, 1980, which responded to 'IMIA's bbtion for Diergency Funding, the Board stated,

" ... IMIA raises a problen which greatly concerts the board; whether the issues of management and financial cmpetence will be full aired. The board itself regards this issue as being very important. Obviously the Ccrmissicn is determined that this issue be carefully resolved in the proceedings. See Ccmnissicn Order, CLI-80-5, March 6,1980. 'Ihe staff's

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status report dated January ll,1980 (preliminary SER) prunises that the cmpetency issues will be pursued by the staff, (Sections C6 and C7) but, until the final SER or its equivalent is cmpleted and tested at the hearing, the board will not know how emplete and balanced the staff's evaluation is.

In the meantime, it seens that 'IMIA is correct in stating that it was pursuing the cmpetency issues nore actively than any other inter-venor. We are advised by counsel for 'IMIA that, because of lack of funds, it will not now proceed with its deposition plans, and 'IMIA ,

warns that the record will be deprived of important input on the manage-

• ment and financial empetency of the licensee. DEA urges the board to use whatever powers are at its disposal to insist that parties w hh available funds, specifically the NBC staff, do more than they have in developing these issues. March 21 letter, p. 2." Slip. Op. 1-2.  ;

1 At the outset of the proceedings, 'IMIA repeated its plea for technical assistance several times. But these nunerous requests fell on deaf ears. Tr. 3661, 3804 (Selkowitz) . Its ability to present a cast on a highly technical issue was l l thus severely curtailed, having to present its entire affirmative case by eliciting l

testimony frcrn hostile witnesses. Tr. 2583-4 (Adler) . j~

The Board's ccmcern as expressed in its Memorandum and Order turned out to be no more than sheer rhetoric. Specifim11y, it unjustifiably accused 'IMIA of defaulting l

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i in its obligation to cmply with onerous discovery requests, and ordered 'IMIA to l preset an affirnative case on 'nEA Contention 5 first, before Licensee testimony  ?

i; was presented, and before the Staff's SER was even issued. 'IMIA thus proceeded to j I-present its case under protest. Tr. 2583 (Adler) . See, also, Tr. 3035-6 (Selkowitz) .

'Ihis procedure was extraordinarily unfair, and violated the fundamental Atomic Energy l i

Act rule that the Nrden of proof in NRC licensing proceedings, particularly as here,  ;

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where the culpability of the Licensee caused the need for the hearings in the first place, rests solely on the Licensee.

1. The Board's arbitrary rejection of 'IMIA evidence, and biased state-ments on the record prejudiced 'IMIA's case on deferred safety-related .

maintenance.

f 29. The Board's assertion in 1292 that 'IMIA agreed at arry point to rely upon Mr.

I Colitz to define safety-related work requests, is directly contradicted by the evidence on the record.

30. 'Ihe Board erred in 11 293-295 in relying upon Mr. Colitz's opinion as to what maintenance activities are safety-related, and errs in stating that 'IMIA offered no alternative means of identifying what maintenance items are safety-1 l

l related.

- 21. We Board's lack of standards by which to accept evidence due, inter alia to its awr. inexpertise and refusal to appoint,hn independent expert in the specific area of safety-related work requests resulted in the arbitrary rejection of 'IMIA ,.

Exhibits or acception for limited purposes only, and severely prejudiced 'IMIA's case, specifically: 'IMIA Ex. 14, 25, 26, 27, 29, (a-d) , 32, 33(a-m) , 34 (a-k) , 35, 37, 38, 40, and 41.

32. We Board's conclusion in 1295 that it liberally applied the question of whether a systen worked on may be nuclear safety-related for the purpose of admitting evidence is unsupported by the record.

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A major subissue of 'IMIA's contention 5 concerned allegations of deferred maintenance I

on safety-related itens and stemned directly from the Keeny Cmmission's findings that maintenance deferral was a precipitating cause of the accident. 'IMIA accmulated the evidence to support its case during the discovery phase, by perusing thousands of work regeust doctanents supplied by the Licensee. 'IMIA identified hundreds of what it believed were work requests evidencing instances of poor maintenance practices at 'IMI-1. Tr. 3036 (Selkowitz) . 'IMIA then faced the task of extracting only those work requests which could be classified as " safety-related." Sough ac this point with-out technical assistance, 'IMIA approached this task logically, in light of the precipitating cause of the accidait and license suspension. At Tr. 2576, 'IMIA's counsel stated the following:

"And the Keneny Cmmission in its findings in respect to the accident at

'IMI-2 concluded that there were cmponents at the plant which were not identified as " safety related cmponents,but which it.pacted upon

' sifety related cmponents,and because the maintenance on those cmponents had been deferred, that the deferral was one of the precipitating l causes of the ao:ident. Now, that is a conclusion of the Keneny l Comnission, and frun that standpoint safety related fran our viewpoint has a much broader meaning. And when we questicn [ Licensee witness]

Colitz, we intend to question him about the consequences of a par *nine caponent failing to operate correctly. That particular cmponent i itself may not be a safety related arponent,but if the failure of that emponent to opa ate correctly can result in a major safety problen at the plant, then we view it as safety related. W at is the approach we are going to take."

l Thus, the Board is wrong to suggest in 1294 that 'IMIA offered no alternative means of determining safety-relatedness.

Further, the Board is wrong to assert in 1292 that the parties, including 'IMIA, l initially agreed to rely upon the expert opinion of Licensee witness Colitz to I

determine whether particular maintenance activities were safety related. At Tr. 2575, i 'IMIA counsel clearly stated that Mr. Colitz was to be called only to describe systms 2__-- __

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e and omponents in order to enlighten the Board, so that the Board could justly arrive at its own conclusions regarding safety relatedness. 'Ihe Board itself understood l thad 'IMIA may not have agreed with Mr. Colitz's definition of safety relatedness. Tr.

2577 (Smith) . In fact, the Board rejected efforts by the Licensee to question Colitz ,

on his opinion as to safety alatedness, using niIA's argument that to permit Licensee 2o elicit such testimony from 'IMIA's hostile witness would violate the law. Tr. 3121 l.

(Smith). See, also, Tr. 2576, 2583 (Adler); Tr. 3035 The Staff's approach was ridiculously narrow. It objected to the relevance of every work request, unless specifically linked, with independent evidence, to manage- .

ii ment's capabilities. 'IMIA moved for the Staff's disqualification for not fulfilling ,

their statutory obligation to protect the public interest. See, Tr. 3044-3045 (Swanson);

Tr. 3048 (Adler) .

'Ihe Board initially semed to indicate an intent to apply a broad standard in defining safety-relatedness. Yet application of their " liberal approach" was not discernable ircm the record. In fact, when the Board was confused or unsure, it consistently adopted the Licensee or Staff approach. But it should be sphasized that the Board was often confused, and admitted the need for expert help. S_e_e, discussico, l' li' Tr. 3604-5, 3668. Yet rather than obtaining cJearly needed assistance, the Board prejudiced niIA's case by arbitrarily rejecting specific work requests or admitting them for lintited purposes only, so that a pattern of deferred maintenance became impossible to establish. At Tr. 3727, Chariman Smith stated, "the Board is not going to accept the exhibit and we're hard put really to explain why. But there has to be a couple points smewhat subjective, scrnewhat arbitrary." Further, at Tr. 3732, Chairman Smith stated "there are no standard that have been presented to us that we can reliably look to to see what the standard is to receive into evidence. So this is our ruling and it could very well be wrong. And we are not going to defend it arrymore .

In addition, the Board arbitrarily rejected work requests when it admittedly did not have sufficient informaticn as to the exhibit's relevance to make a fair ruling.

See, discussion, Tr. 3672-3675; 3775. 'Ihe Board's biased disregard for 'IMIA's handicaps

t in trying to develop, on the record, a pattern of deferred maintenance is perhaps best exmplified by Chairman Smith's casual remark, ..."if pu win scme, you lose scne, I cbn't see how it is going to make a big difference". .. Tr. 3662. The Board's conduct violated one of the most fundamental precepts of adninistrative law - that the discretion of an administrative agency may not be exercised arbitrarily and capriciously.

See, National Airlines, Inc. v C.A.B. , 321 F.2d 380, 383 (D. .C. Cir.1963) (" arbitrary exclusion of evidence") .

2. The Board's conclusion that no evidence of deferred safety-related maintenance or repair was produced, is arbitrary and capricious.

23. 'Ihe Board erred in not properly developing the record on mIA 5 after 'IMIA's attorneys withdrew fran the case.

35. The Board's conclusion in 1300 that it found no evidence that Licensee inproperly deferred safety-related maintenance and repair is unsupported by the record.

82. The Board violated due process by imputing 'IMIA's new intervenor with total knowledge of the proceeding until that point to the extreme prejudice of 'IMIA, and in not cmmunicating certain essential information to her.

The Board rests its finding in 1300 primarily upon Licensee's rebuttal testinony to 'IMIA Contention 5. Licensee presented its rebuttal testimony in February, 1980 -

several nonth after 'IMIA's initial case. By that time, 'IMIA's counsel had been forced to withdraw due to 'IMIA's inability to finance them any longer. The case was inherited by Iouim Bradford, a volunteer member of 'IMIA who worked at night and thus was able to attend hearings during the day.

Ms. Bradford was recognizably unfamiliar with the hearing issues, but rather than providing her with any constructive assistance or aavise, the Board inputed her with total knowledge of what had transpired in months of hearings before she became involved. (Free transcr pt delivery to 'IMIA had ceased one nonth narlier) . She scrambled to learn 'IMIA's case in her " free" time. But obviously, she could not be expected to understand, let alone analyze and prepare cross-examination for Licensee' rebuttal testinony. Yet the Board, who certainly kncw its obligations under the Comnissicn's August 9,1979 and March 6,1980 orders, and considered 'IMIA's allegations

i$portant enough to inwstigate on its A whether alleged examples of improperly deferred safety-related mamtenance cresented by 'IMIA indicated a lack of attention on the part of the Licensee,1290, barely questicned Licensee witnesses when they f appeared to present the rebuttal testimony. See, generally, Tr. 13,534-13,636.

33. The Board's sumary ccriclusion in 1 296 that the Incensee's written testimony i satisfactorily indicates no significant improper maintenance deferral is unsupported I by the record, contradicted by the decision itself, and fails to inform the reader of the factual basis for these ultimate conclusions. i 1

Licensee's answer to 'IMIA's evidence on maintenance deferral, explained in its l l

rebuttal testimony, consists merely of conclusions unsupport>M by documentation.

Their explanaticns contain facts purely within their knowledge, and without having been subject to any real cross-examination, it is impossible to know the validity of l, these facts. See, Shovlin, et al., ff. Tr. 13533. The Board has erred in providing j unquestioned support for the theories advanced by the Licensee m this testinony, i

and for merely reciting, in the PID, the list of exhibits and corresponding page nunbers  !

where dis:ussed in Licensee's testimony to support its conclusion. 5 296. By drawing this major conclusion, based on factually uncupported evidenco, and with no discussion of factual basis for doing so, the Board has violatedthe fundarrental rule that 1

the grounds upon which the adninistrative agency acted be clearly disclosed and {

adeqtutely sustained. S.E.C. v. Chenery Corp. , 318 U.S. 80 (1943) .

34. The Board ignores 'IMIA's arguments of potential safety probles associated with delays in cmpleting 'IMIA's work request Exhibits 23, 33(a-m) , 34(a-k) ,

and 40, and improperly relies upon Licensee and Staff unsupported statments that' the work was or will be done in an acceptable manner.

'Ihe Board's conclusion in 5 300 that no evidence exists from uhich to conclude Licensee has improperly deferred safety related maintenance, is directly ccntradic-ted by the Board's own findings in 5 298 and 299. In 5 298, the Board concludes that 'IMIA Exhibits 33 and 34, dealing with air handling filters in the machine shop ventilation systs, indicates that mamtenance deferral on these itms constituted a potential long run safety problem. (m phasis added). Similarly, regarding TMIA Ddubit 40 which concerns a spurious alarm problem, the Board determines without any perceivable analysis that the spurious alarm creates no significant probim, disre-

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garding 'IMIA's argments in its proposed findings (PF) 1 16, yet concludes that "a delay of almost four years sees long in view of the fact that it should be fixed eventually." While the Board may not have used the terms " deferred maintenance,"

the clear implication of this statment is obvious. Similar problems are apparent in the Board's analysis of 'IMIA Exhibit 23, at 1297, particularly a failure to address

'IMIA's concerns in PF 125, and reliance without discussion upm the Staff conclusion that satisfactory adninistrative mntrols were in place. 'Ihere is absolutely no support in the record or in the decision that these items will be corrected, or that similar prob 1ms will be corrected in a timely manner so as not to risk the public health and safety. l

3. 'Ihe Board's conclusion that the Licensee's new priority system for cxxrpleting maintenance work is satisfactory, is arbitrary and capricious, and unsupported by the record.

24. 'Ihe Board's conclusion in 1284 that the manner of assigning priorities is " radically different" is not .=.:pported by the record.

26. 'Ihe Board inproperly fails to discuss 'IMIA's arguments concerning confusion as to the new priority definitions by Licensee's management and witnesses, described in 1 287.

An important subissue to 'IMIA's maintenance deferral contention concerned the effectivmess of Licensee's syste of assigning priorities to specific work request ites. Even Licensee does not dispute that the Sld" systs was deficient.1:285;..

One of the main problems conuxned the priority definitions thmselves - they were brief, ambiguous, and provided little guidance to the individual responsible for i assigning the priority. Upon reading the highly touted "new" definitions,1287, one can see that these definitions are still brief, ambiguous, and provide little guidance to the individual responsible for assigning the priority.

i

~

In addition, the nore serious probim of the priority systm's inplementation, I or "hunan interface" with the system, can not be corrected by mere proceduraLor definitional changes. First, it was certainly true that in the past, th me at the plant had ambiguous notions of what the priority systs was even supposed to stand for. Tr. 3068, 3101, 3105 (Shovlin). But testirrony revealed that this is still indeed

P _

- the case. Tr. 3615 (Isakway) . Second, it is obvious that the new definitions do little to eliminate the trenendous anount of subjectivity required of one assigning priorities. See, e.g. , Tr. 3071-2 (Shovlin) . For exanple, the new definitions require a detennination as to the predictable amount of time the job will take to complete. Yet Licensee has no guidelines or reliable method to assist atployees in making such a detennination. See PF 26-31, so a highly subjective 'judgenent is required.

Moreover, the method of assigning priorities has not improved, and the Board's [

claim that the method is " radically different" is contrary to the evidence in the record. The prior system had been routinely abused. Tr. 3076 (Shovlin); Keimig and Haverkamp, ff. Tr.16,412, at 65, Att. A No.16. See, PID 1 285, 286. And the record indicates that the new systen is hardly differeat. Under the old system, the initiator of the work request would physically assign the priority designation, meaning that he wrote his designation cm the work request. 1 285. However, the Board fails to mention that the initiator's in =1iate supervisor always reviewed the designation and always had the opportunity to physically change it. Tr. 2677, 3076 (Shovlin) . The new Priority 1 definition merely writes this procedure into the definiticn. As Plant Maintenance Manager Shovlin explained, when the work requests reached him, he always had an opportunity to physically change the pricrity. ,

Under the new systenh practically identical process is in place. Now the initiator l

"reemmends" a priority designation, which means he physically writes his reammendation where indicated on the job ticket, but his superiors nust approve the reemmendation as before. The Plant Maintenance Manager or his designee now does the official

" assignment," 1 287, by so indicating on the job ticket. 'Iherefore, now, instead of crossing out a priority designation he believes inproper, the Plant Maintenacoe Manager merely changes the priority by filling in another blank. The process is virtnally identical as before, with the only perceivable differences being of form, not substrace.

The new process does nothing to correct the abuses of the old system.

r

31. The Board grossly erred in failing to discuss anywhere in the decision the prob 1m s associated with a lack of guidelines defining what work could or would have an impact on nuclear safety. .

Another strikingly important proble which the new priority systs certainly does not solve, and whichis entirely disregarded by the Board, concerns the lack of guidelines to assist indivichmls empleting job tickets who must determine whether malfunctions have effects on nuclear safety. Not only does the new Priority 1 definition include items which are " nuclear safety hazards," but the new job ticket, as did the old work request, requires an individual to check a box indicating whether the work will impact upon nuclear safety.

Testinony revealed that the Licensee has a nonexistant or at best inadequate concept of safety-related maintenance work and no guidel& as to assist an individual in job ticket empletion. See, PF 7, 8, and 23. Nor d the Staff provide a useful definition.

In fact, even in its testinony on the Board question concerning the auditability of maintenance practices in 1978, the 9taff fails to explain by what criteria it selected the 23 " safety-related" (or safety significant) work requests which it inspected, and which provided the basis for their cmfortable conclusion that "no items of non-cmpliance were detected." Keimig, Haverkmy, ff. Tr.16,412, at 6, 9. And the_ Board itsel$cokissuewiththeStaff'sillogical.conceptofsafety-relatedness.Tr.3900 The Board semed to recognize this fundamental proble in 11300 and 305 (footnote 27), but brushes it off as a mere record keeping prttlem without discussing the l l

obvious implications of Licensee's obscured perception of such a vital conmpt.  !

l The Board grossly errs in not addressing this issue.

' 4. Licensee's past record-keeping problems have not been corrected, and The Ihud errs in arbitra .rilwupporting restart despite acknowledged prebims.

Perhaps the most blatant failure of 'IMI-l's maintenance deparanent, on which the evidence was particularly strong, concerned its failure to keep accurate maintenance remrds. A number of work requests, which were characterized as Licensee's " official legal documentation of work performance," Shovlin, et al. , FF. Tr.13,533 at 35,

4 5 evidenced this problem. -

Fbr example, a nunber of 'IMIA Exhibits showed that work campleticn dates were inacurate or not noted at all. Tr. 3533 (M: Gary); Tr. 3724 (Eisenhower); 'IMIA Ex.16,

- Tr. 3528 (Shovlin) ; 'IMIA Ex.17,18, Tr. 3560. Sczne were marked " cancelled" or

" purged" with no further explanation as to tru the probles were corrected. 'IMIA Ex. 40, Tr. 3796-99; ' INIA Ex. 21 and 22, Tr. 3596-3602; 'IMIA Ex. 24, Tr. 3630.

27. The Board inproperly fails to discuss how the new priority system will solve the adnitted past maintenance proble of accunulaticn of duplicate work requests and fails to evaluate such accumulaticn in the ccntext of management ocmpetedtbe.

' INIA Ex. 33 a-1, m,(Tr. 3709 for discussien) represents a series of twelve work requests, all cancelled in favor of a thirteenth. 'Ihe accumulaticn of duplicate work requests such as those exhibited by 'IMIA Ex. 33 had reached such proportions at

'IMI-l by the fall of 1979, that in October of that year, a review of all priority 1-A, or " urgent" work requests was ordered. The cmpany had lost track of the t maintenance work which, by itsixn definition, needed inmediate attenticn. In discussing this issue, the Board fails to mentien thdnost relevant point regarding maintenance practices at 'IMI-l today - that the same maintenance depart 2mnt managers who permitted I

a probl e of this magnitude and significance to develcp, are managing the department i I

currently. See, discussion, S II, B,1, infra. The Board's decision provides no j assurance that these individuals are any more cmpetent than they were in 1979, nor how 1 the new priority systs addresses the prob 1cm of managanent incmpetence.1285. {

41. The Board's reliance in 1 314 upon the unsubstantiated and insufficient Staff conclusions is arbitrary and capricious.

42. The Board erred in relying upon Staff testirony in 1314 in that the Staff was inherently biased against 'IMIA's positicn and did not properly perform its independent regulatory function at the hearing, and misinterpreted the hearing issues and law.

44. The Board erred in not properly developing a cmplete record in the issue of auditability of maintenance records, into which it was motivated to inquire further based upon testimony and 'IMIA Exhibits.

The Board revealed on the record of these proceedings that in its opinion, 4 record-keeping issues were " unimportant." Tr. 3598. The Board's attitude

e S persisted throughout the hearings, and is evident throughout the PID. For example, the Board had the Live and the Staff submit additional testimony on the auditability of safety-mlated maintenance practices during the year 1978. Yet the Board had already cxpressed on the record that the Staff not only lacked proper concern about the record-  ;

i-keeping issue, but did not have a correct concept of safety-related maintenance work.

Tr. 3900 (Smith) . The Board then used the Staff testimony, on which there was no cross-examination, (See Tr. ff. 16,412)to conclude that Licensee's re wrds were auditab3e, while recognizing in the same paragraph that 'IMIA has brought feward exmples of inaccurate and inocmplete maintenance records. Rus, their cxrtclusicn that "none of the proble s disclosed safety problems in the actual work" is unsubstantiated by any reliable or credible evidence. Moreover, it is directly ccmtradicted by the Board itself in 1 316-319 - itms which the Board believed were " worth notiivg."

l Each of these "itas" concern significant safety probles which have resulted frun poor record-keeping practices. We Board's conclusion in 1 314 is extremely arbitrary.

11. %e Board fails to discuss in 194 the many problems associated with the maintenance department's new e mputerized systs.

38. The Board errs in 1305, ftnt. 27 in not desang inconsistencies among work requests in QC and nuclear safety-related designaticns as a safety-related proble reflecting upon managment incrmpetence.

40. The Board's conclusion in 1 310 that it appears the new cmputer system will be effective, is arbitrary and unsupported. t The Board is not even convinced that the highly touted "cmputer systs" will insure the correction of past record-keeping probl es, relying again on the Staff to investigate six months after restart, 1315, after Licensee has gained " experience" with it. nus, the Board's repfesentation that it is reasonably assured the ccuputerized system will correct past deficiences, is clearly unsupported. This is particularly true in light of such past prob 1ms as misplaced record and inaccurate empletion of job tickets which the new systs does nothing to correct, and in fact could exacerbate.

See, PF 73-78.

l

. ~ . - - _ , ,

4 - ,

, Eurther, the Board actually acknowledges problens with the new system, and fails to require the Licensee to resolve then at all, let alone before restart. See -

91 316-319. Thus, the PID clearly has left open unresolved safety itens, violating not only the August 9 Order, byt the Atanic Energy Act's mandate that a reactor mga not operate in the absence of actims which are required to assure safety. %e Board's decision to support restart with these outstanding problems is arbitrary and capricious, and without justification in law or fact.

% us, it apn= rn that the issue of safety-related record-keeping practices was either so insignificant to the h rd that it relied in its decision exclusively on testimony presented by those it had previously found unqualified to present anaccurate portrait of the problen, or it was an issue the Board purposely neglected. In either case, the Board must be faulted for its reckless disregard of a serious safety-related issue raised in these proceedings.

5. %e hrd's shrvMy treatment of questions raised by 'IMIA's evidence of excessive over+i- at 'INI-l is arbitrary and capricious, and contrary to law.

The Board's treatmmt of 'IMIA's allegaticn concerning Licmsee's use of exces-sive overtime in the performance of safety related maintenance lacks any reasoned analysis whatsoever. Certainly, overtime should be prohibited at a nuclear power plant where individuals are working on safety-related systems and the risk of care-hssness due to fatigue is prnhable. W e Board never confronts this question, T 332, and in light of evidence developed at the hearing, the Board's analysis of the overtune issue is renarkably arbitrary.

50. he Board in 1 334 mischaracterizes the testimony of witnesses Reismil.ler, McMurdy, and Eberle.

51. We Board's dismissal of the testimony of witnesses Reismiller, McCurdy, and Eberle in 1 338 and 1 341 is arbitrary and capricious, and abuse of discretion,

! and an error of law.

53. We Board's conclusicn in 1341 that no overtime abuses existed is unsup-perted by the record. ,

s

u-Three witnesses testified on the issue. The Board sumarily dismissed the testimony of all three, t 339, incorrectly characterizing the testimony as too " subjective."

Actually, all three witnesses corroborated one another on many points. Not one of the three refuted such points as: extreme cases of excessive overtime did exist, Tr. 4150-51 (McCurdy) Tr. 3998, 4001 (Eberle); at least rumors of emplaints concerning excessive overtime existed, Tr. 4003-4 (Eberle); Licensee did not limit the anount of overtime which could be worked per week, Tr. 4155 (McCurdy) .

But on those significant issues where the testimany differed, the Board failed to even examine the witness' credibility, or the reliability of the testinony.

Witness McCurdy, who did not testify specifically as to excessive overtime, is a shift maintenance forman who in fact schedules overtime himself. His self interest in not testifying to abuses in the system is obvious.

'Ihe most damaging testimony came fran witness Reismiller, who left the ccrnpany under feelings of duress due to forced canpulsory overtime. Tr. 4165. Moreover, he is an individual who, while working for the ccznpany, would have been particularly sensitive to workers' feelings cn the issue. Mr. Paimiller was involved in the International Brotherhood of Electrical Workers for many years, was union president at one time, and union steward fran 1962 to 1977. If worker discontent existed at the time, he would have been aware of it.

He testified that during scheduled refueling outages, workers were told to work twelve hours a day, seven days a week. Tr. 4166. At one point, the unicn requested an alternate policy of three nine'-hour shifts. Management apparently did try this once, but later changed back to the original policy because he was told, "there was not enough men." Tr. 4167.

Beismiller testified that he knew of one individual who had worked thirty-four hours, and one who had worked forty hours straight during normal operations. 5334.

But during refueling, workers were expected to work longer hous than usual, and if they chose, could work as long as they wanted to over and above twelve hours. Tr. 4168.

He knew of men who did work those long hours. Tr. 4167. When the union catplained that mandatory twelve hours was not a safe policy, the policy was changed to permit

' wo'rking no 1cnger than sixteen hours without permission. But even these guidelines were not followed. Tr. 4169. (Beismiller)

The overtine policy was enforced quite simply- if an individual did not work it ,

or could not work it. a letter was placed in his file. See, Shavlin, et al., ff. Tr.

13,533, attachnent 10. Reismiller's lcngest consecutive stretch was twelve hours a ,

day, seven days a week for three to three and one-half nonths. This was bad enough.

lbwever, he also described a ciretrnstance where he had been scheduled for overtime, was ill and called in sick, but was told that he better oczne in anyway. Nhen his super- 1 visor realized the genuineness of his illness, he was sent hczne, but a letter was still placed in his file. Tr. 4177. Too much overtime, he testified, made people l edgy. Tr. 4179. The longer the hours, the more careless they became because of fatigue. Tr 4183. Beside the 1cng hours, however, he testified that during refuel-ing outages, Met-Ed went so far as to cancel or conveniently not inform workers of safety meetings where industrial safety issues were discussed. Tr. 4183, 4196.

Ccrnplaints of too much forced overtime eventually pronpted Reismiller to request a meeting with the top management of GPU. Tr. 4170. He met with Robert C. Arnold, then Vice President of Met-Ed, and with Jack Herbein, then Station Superintendent.

Generally, Reismiller testified, Arnold was far frczn respc:nsive to those ccatplaints, stating that "it's their job to get this on line as fast as possible," and to ,

t

" serve the public," and as Reismiller was told, "the faster the plant is back on l line, the faster we are making money." Tr. 4183. When Reismiller asked Arnold 1

about hiring more pecple, Arnold explained he had no authority to do this, Tr. 4171, mphasizing that overtime is "a way of life at a power plant - there are peaks and valleys in a work schedule, in a peak, you can use th m , but in a valley, there would be nothing for th m to do." Tr. 4178. 'Ihe Doard failed to call either Arnold or Herbein to testify as to what managment's response was to union ccrnplaints. Instead, it simnarily rejects Reismiller's testimony, clearly abusing its discretion.

49. The Board mischaracterizes 'IMIA's arguments in 5 343 and fails to j evaluate whether excessive overtine existed at 'IMI-1, or whether overtime created probims of fatigue which could impact on safety.

54. The Board's mooting of overtime issues raised by 7MIA by the policy set out in IE Circular 80-02 is arbitrary and capricicus and an abuse of discretion in that the Board fails to provide any reasoned analysis for many questions ,

raised by evidence on the record, fails to ccnfrmt facts on the record and the  !

legal inferences which those facts suggest. 1 343.

Mr. Reismiller's testinony is a mrious indictment upon managment's ocenitment to safety. Althou3h Licensee states that "under no ciremstances were they forced to work overtime," Shovlin, et al. , ff. Tr.13,533, at 71, direct force is not the Licensee's only means to insure empliance. Reismiller testified many were merced into working for fear of getting a letter in their file. Tr. 4178. Maintaining that workers could be excused frm work with sufficient notice, Shovlin, at 71, does not answer the }-

questions raised in Reismiller's testimony, such as how nuch notice would be required, .

i would a worker receive a letter anyway, and were people fatigued after twelve hours of work, seven days a week? Such issues were never addressed by the Board.

Instead, the Board noots the entire overtime issue.1 343. Clearly, t'm policy set out in IE Circular 80-02, which sets waivable guidelines, noots none of the nest serious questims concerning management attitude toward overtime, its enforcement policy, its ccmnittment to safety, and in particular, how and why the abuses in the syst s developed. Further, given this cmpany's history of failing to follow even required procedures, (See discussim,;'l Einfra), the Board errs in relying on  !

this new " policy" to assure future safe use of overtime. ,

Moreover, if the Board chose not to believe these witnesses, it erred in not stating -

4 why and in cancelling the other two witnesses scheduled to testify on the overtime issue. The Board abused its discretion in not conducting a sua sponte Board inquiry into the matter.1 339. Plainly, the Board's decision on this most important safety issue must not stand.

15. The Board's conclusion in 1 106 supporting the adequacy of the plant maintenance program is unsupported by the record.

37. The Board's conclusim in 1 304 that Licensee has properly responded to correct its poor past system of maintenance records is not supported by the record or the decision.

o For the above stated reasons, the Licensing Board has erred in finding the Licensee's maintenance program at DII-l adequate to support restart.

C. "the Wd does not resolve the following Board Issues to provide reasonable assurance that Licensee managernent is capable of safely coerating TMI:

Board Issue 1: Whether Metropolitan Edison's cm mand and administrative structure, at both the plant and corporate levels, is appropriately organized to assure safe operation of Unit 1.

Board Issue 6: Whether the relaticnship between Metropolitan Edison's corporate finance and technical departments is such as to prevent financial censiderations frm having an inews:r impact upon technical decisions.

Board Issue 10: Whether the actions of Metropolitan Edison's corporate or plant managenent (or any part or individual msnber thereof) in mnnection with the accident at Unit 2 reveal deficiencies in the corporate or plant managenent that must be corrected before Unit 1 can be operated safely. .

Neither TMIA nor any other intervenor had contentions relating to Board Issues 1, 6, or 10. However, because of the gravity of these issues and the manifest failure ,

of the Board to properly develop a balanced record on each of them, TIIA was forced to j pursue than in its findings and later docunents. .

The evidence gathered in the reopened proceedings is particularly gemane to Board Issues 1 and 10. This evidence is discussed in S III, infra, and cmpels the conclusion l that the Board's findings and conclusions regarding Licensee's current management structure, current managers, management's response to the accident, and managenent's ,

I capability to safely operate Unit 1 in general, is not supported by any relevant or ',

reliable evidence. But this evidence only strengthens an otherwise powerful mnclusion that based on the record of the main proceedings, the Board has not sufficiently resolved these most fundamental mncerns of the Camission to find managenent ccrnpetent to safely run TMI-Unit 1.

All three Issues were litigated primarily during February, 1981. This is significant only in considering why IMIA did not sivWnly adopt these isbs as its own as they were being litigated. As explained in S II, B, S, supra, at this precise timeperiod, TMIA's new intervenor was scrambling to learn TMIA's maintenance case, as was her t

I primary responsibility. Although IMIA did take an interest in these issues, it is obvious that under the ciremstances, TMIA was literally incapable of developing a record on the Board Issues also. Furthermore, it was not IMA's responsibility to do so. Yet the Board feels obliged to attack TMIA when raising points disputing the I

1

. adeciuacy of the record on these issues, which consists of, virtually without exception, Licensee or Staff testinony. (See, e.g. , 11 97, 491) . Many of 'IMIA's emcerns were expressed in its findings. All of these concerns were ignored by the Board in its j decision.  !

1. The h d fails to resolve Board Issue 1.to provide reasonable i assurance that Licensee's managenent structure is aporopriately ['

organized to assure safe operatim of Unit 1.

1. The Board's assertion in 141 that managenent and high-level technical personnel at the hearing came and underwent extensive questioning by the Board and the parties is contrary to the record. ,

2. 'Ihe testimony cited by the Board to support the new management structure in 11 55, 58, and 60 is unreliable, self-serving, and inconclusive.

5. The Board's statenent in 164 that Messrs. Crocker and Allenspach have expertise to eraluate the management and ocmmand structure of a nuclear utility is contrary to the evidence.

8. The Board's conclusion in 167 with regard to Licensee's administrative and ccmmand structure is contrary to the record.

15. The Board's conclusions in 11 105-106 supporting the adequacy of the plant managenent structure are unsupported by the record.

16. The Board errs in its exclusive reliance upon Licensee and Staff witnesses in 11 120, 121, without discussing or considering their objectivity and credibility problens.

17. The Ibard in 1 121 improperly relies upon inaaequate and unreliable Staff testimony to support a conclusion of management cxmpetence.

The Board insists that, based upon the encbrsements of the witnesses and the .

qualifications and attitudes of GPU's top managers, the ccmnand and acininistrative  !

structure of GPU Nuclear Corporation at both the plant and corporate levels is appropriately organized to assure safe operaticn of Unit 1, and that all individual managers are conpetent. However, the record is devoid of any credible evidence to support this conclusion.

Each witness who endorsed the new structure lacked expertise, objectivity, or credibility. NFC witnesses included the authors of the document on which the new managenent structure is based. Tr.12,014 (Crocker) . However, these individuals admitted under direct questioning that they had had no managenent training and were in fact unable to say that the new GPU structure was the " opt. unum" for the cmpany.

Tr. 11,991 (Crocker) . Another NFC witness whan the Board cites in support of the

reorganization is Richard R. Keimig, whose qualifications show absolutely no managment training or background. Keimig, ff. Tr.11,946 at 7. 'Ihe other witness the Board mentions is Mr. Donald R. Haverkamp, on-site resident inspector at 'IMI, whose 1

objectivity in evaluating GPU's management structure was questioned. See, discussion, l i

Tr. 12,025-30) . Further, he has no expertise in the area. He has stated that since i the accident at 'IMI-Unit 2, he has personally observed no other utility- including any which has itself undergone management reorganization as a result of probles evidenced by Met-Ed managment during the accident. Tr. 12,025,12,030 (Haverkamp) .

On behalf of the Licensee, Messrs. Mihs and Wegner, mmbers of the Basic Energy Technology Associates, Inc. (BETA) were called to testify on managment l 1

capability. Again, the backgrounds of these two individuals, as well as the other two individuals which cmpose BETA, indicate no management training or experience in the area. Wegner ff. Tr.13,284, Att.1.

Mr. William Lee, President and Chief Oprating Officer of Duke Power Cmpany, and Chairman of the Boarti of Directors of the Institute of Nuclear Power Operations (INPO),

also testified on behalf of the Licensee. While there are no grounds in the record to question Mr. Lee's expertise in nuclear plant managment, there are obvious l

probims with his objectivity and credibility considering his pruninent position in ,

the nuclearindustry. Lee, ff. Tr. 13,251 at 2, 3. But also, Mr. Lee made such  !

incrvvhble statements about managment's reFB>nse to the accident at Unit 2, such as "they behaved strongly and well during the accident," Tr.13,274 (Lee), and that Messrs. .

Dieckamp, Arnold, and Herbein and Miller dmonstrated effective abilities to respond to a crisis envirm ment with objectivity and calm. Lee, ff. Tr. 13,251, at 4.

Such testimony can not be considered credible.

The only other individuals who testified on this topic were the managers them-selves. Thus, the Board's decision relies exclusively on Licensee and Staff witnesses and concludes that Licensee's corporate structure is appropriately organized. Clearly, the Cmmission's mandate placed upcn the Board the obligation to inquire well beyond the self-serving, rubber stamp endorsments of the Licensee

and Staff witnesses.

t

3. The Board's conclusion in 1 59 that individual m mbers of the organization appearing before then seen to have a clear understanding of their responsi-bilities , etc., is irrelevant to a conclusion of managenent empetence and ,

improperly relied upon by the Board. 7 i

7. The Board's rejection in 166 of 'IMIA's proposed findings 58 and 59 is j arbitrary and capricious. l

18. The Doatrd's omclusions in 11 127 and 128 are irrelevant and can not support a finding of managemmt empetence. ,

l

19. The Board grossly errs in finding the following managers umpetent: j.

Herman Dieckamp, 1 129; Robert C. Arnold, 1 130; Jack Herbein, 1 142; Daniel Shovlin, 1 156.

The Board was extranely lax in its analysis of the cxxnpetence of many top i

managenent personnel. The Board's reliance on such criteria as a managenent witness' "deneanor and poise," or lack of "arrogan or situational resentment," or

" truckling",1i271s particularly irrelevant in light of direct evidence cn the record that a number of these individuals were in the past incapable of properly managing or had severe integrity probi ms. For example, in discussion of 'IMIA Contention 5, Licensee admits that the past maintenance department under Daniel Slovlin's directicn was inadequate. See, discussion, S II, B, 3,4. In its present endorsenent of Mr.

Shovlin, however,1 156, the Board fails to even mention his past experience or his possible role in the developnent of prior maintenance problems at 'IMI. Such first i

hand direct evidence is significantly nere meaningful in evaluating his ompetence than a recitation of his resume, or the vague, innocuous statement by the Staff that senior managenent at 'IMI and GPU are "probably above the norm," or the similarly general endorsenent by BETA under itr, " objective standards." 11 122, 123. Similarly, canpetence and integrity problens of Herbein and Deickamp as they relate to their performance during and after the accident ,do not factor, to tur/ significant extent,1f at all, in the Board's glowing endorsenents of either corporate manager. 'Ihe Board's failure to meaningfully analyze the cmpetence of any individual discussed in 11 116-162, sustains the conclusian that the questions raised by the ccmnission in Board Issue 1 renain unresolved. (See, S III for further discussion of individuals Arnold, Ross, Herbein).

• 2. The Board fails to resolve Board Issue 6 to provide reasonable assurance that financial consideraticns will not have an improper impact on technical decisions. l l

56. The Board fcils to evaluate the issue of financial / technical interface, in  !

11 387-401, in light of relevant testimony of prior financial / technical inter-face. 7

57. The Board's exclusive reliance upon Licensee's unreliable conclusory testi-  !

many and the Staff's unsupported conclusions that financial cxmsiderations have no undue influence on safetu, is arbitrary and capricious, contrary to law, and an abuse of discretion. . 11 389-390.

58. The Board's conclusion in 1401 that Licesee has provided reasonable assurance that the relationship between its corporate finance and technical departments is such as to prevent financial considerations frcm Nning an inpact impact upon technical decisions is contrary to the evidence and unsupported by the record.

I he Board was inst. W. by the Ccumission to examine whether Metropolitan l

}

Edison Cmpany would permit financial consideraticns to have an inproper impact upon technical decisions. %e Board relied almost exclusively upon the testinony of Herman I

Deickamp, President of GPU, in evaluating this issue, supported by Staff conclusions  !

i which were primarily based upon interviews with GPU managment individuals. Tr.

12,059. Interviews with Licensee's managment perscnnel, and the testimony of i

Deickamp are plainly self-serving, and therefore the Board errs to rely exclusively upon this unreliable eviden to support its conclusion that financial considerations I

will have no improper 2mpact upon technical decision. W e Board had previously $

heard other testimony directly relevant to this topic ccncerning the issue of I excessive overtime - such evidence contradicting Deickamp's assertions that Licensee I

would willingly shtit the plant down if financial situations warranted it. The '

l Board was obligated to at least discuss this relevant testimony in the ccntext of I

this Board question. Weir failure to do so is a significant error.

In particular, the Board erred in not closely exardning Deickanp's sphatic insistence that at GPU, safety always takes precedence over econcmics. 11 391, 392; Tr. 13,497, 13,498. This he supports by boasting of increased manpower and financial expenditures at GPU. Such testimony is insufficient to sustain the Board's conclusion.

The statistics cited in 1398 could indeed support conclusicns directly opposite frcm those the Board has drawn. The fact that manpower levels and Operaticn and r

-2 b Maintenance expenditures are high relative to the industry could just as logically mean that the Operation and Maintenance Departments are inefficient, or that the equipment is in much greater disrepair than in most other plants. -

f I

Also, diverting a large share of the budget to inhouse manpower is meaningless without some evidence that the plant would benefit frm this policy. Indeed, the plant may very well benefit nore by increasing B&W personnel support. Further, using the industry norm as the standard for ompariscns in 11398 and 400 is useless -

without sme evideice indicating what the industry norm is. In fact, the only evidence cn this record regarding the " industry norm" concerned pre-accident events. [

Tr. 12,104. With no evidence that the industry nonn has inproved, these cmparisons are certainly unreliable to support the Board's conclusion in 1401. The evidence as examined by the Board on this issue is inherently unreliable and irrelevant, and thus totally unsupportive of the Board's ccnclusion. The Board has clearly not fulfilled [r its obligations to the Ccrmission in evaluating Board Issue 6.  !

3. The Board fails Po resolve Board Issue 10 to provide reasmable assurance that Licensee has corrected all managenent problens revealed by the Unit 2 accident.

l-t

59. The Board viciated its duty to properly examine Board Issue 10, as described [

in 1 461. ,

60. The evidence and testinony cited by the Board in 1462, and 11465-467 to support Licensee's view that managenent acted ocmpetently during the Unit 2 accident is utterly unreliable.

Perhaps no other Board Issue has been treated so arbitraily as Board Issue 10.

Licensee's expert witnesses on the issue were neither credible nor reliable, particular-ly in light of the contradictory information available in the various accident investigations. (See, S I) Mr. Wilbam Ice, President of Duke Power Cmpany, was of the opinion that Licensee's managenent responded to the accident uith " great skill and

' steadfast purpose." Yet he never even arrived on the accident scene until fully one week after the accident was over.1465. Mr. Wegner of BUIA, who similarly conducted no reliable investigation into the accident, blames the entire industry for the

( accident rather than individual performance. His impressions also contradict the conclusions of the off_tcial investigations. Finally, Licensee m ployees, Messrs.

F$aton and Iong, who were only involved in post-accident events, offered entirely self-serving testimony, the credibility of which the Board itself cast doubt upon.

9 466.

62. The Board erred in not accepting into evidence 'IMIA Exhibits 49 and 50, as described in 1469, and rejecting 'IMIA's Motion to Peopen the Record on July 9, 1981.

70. The Board erred in footnote 47, 1 490, in not requesting witnesses on its own to pursue the conclusion of the Udall report.

l The Board devoted a great deal of attention to managment ccumunication probles i and returting failures durimJ the accident, particularly with regard to whether informa-  ;

tion was withheld frm State and Federal officials. Staff Ex. 5,NUREG -0760, concluded that while Licensee was "not fully forthcming," informaticn was not inten-tionally withheld. 'Ihe Board took official notice of every other federal government report on the information flow topic - with the excepticn of the Peport of the U.S. House Interior Cmmittee, or Udall report. The Udall report was the only investigation which concluded, based on a careful analyisis of the evidence, that managment officials Gary Miller and Jack Herbein, deliberately withheld informaticn <

frm State and Federal officials. The Udall report's conclusim, but not its supporting ,

analysis, was received, despite 'IMIA's attempts to have the Board receive the entire ,

document. Finally, when an ACRS fellow issued a paper endorsing the Udall report over NUREG-0760, 'IMIA moved to reopen the record to adnit both the Udall report and the ACRS paper. The Staff endorsed 'IMIA's motion. Despite 'IMIA's offering the Udall report's author as a supporting witness, the Board denied 'IMIA's motion.1490.

Tr. 22961-22,966.

The Board blatantly erred in denying 'IMIA's moticn. The Board relies on the fact that NUREG-0760 analyzes the same raw material as the Udall report, but just reaches different conclusions. However, the Board ignores tie more significant point that 0760's use of selective facts has allowed it to ignore clear signs of 1

i deliberate and intentional withholding of informaticn by management frcm State and Federal officials during the early stages of the accident. In addition, 0760's ccnclusions are often based on testimony which is directly contradicted by other testimony and facts.

t

m The credibility of the Udall report over 0760 is heightened when one considers that 0760's author, Mr. Victor Stello, has adnitted to the Cmmissioners that "an argtunent could  !'

be made for intentional or deliberate withholding of infonnation because of conflicts in the record." Tr. of December 21, 1981 public meeting, at 8, 15. Moreover, Mr. Stello stated at this briefing that he was personally in total agra2Tient with the conclusions of the Udall report. Clearly then, the h rd's m nclusion in 1 468 that there are no reaaining differences between the positims of IE and the Licnesee .

indicatinj an irresponsible managenent attitude by Licensee toward its nuclear related j activities, has lost credibility. ,

Thus, 'IMIA maintains that to finally answer unresolved questims surrmnding information flow, as the Cmmission mandated, the Appeal Board should cmduct a sua sporitdL ,

review, and thoroughly examine on its own the raw materials available. 'Ihe Board's failure to do so, given the implications of managenent's involvement, was a gross l

+

t error. l Specifically, the already existent evidence on the issue reveals that Gary Miller t and Jack Herbein, both of whm until recently held critical safety-related posts with 7

the Licensee, and were involved in subsequent ir' proper cmduct relating to certifying false statenents to the NBC, (See, S III) , were respmsible for cmtrolling what infonnation reached State and Federal officials. Miller, who was Staticn Superin-tendent and Emergency Director during the accident, was responsible for providing information to Herbein, who was the information source for the State and NBC. Herbein was the top m rporate official at the scene of the accident on March 28. Although renaining off-site, he was responsible for briefing both State officials and the press throughout the day.

' A close examination of what others have testified to being aware of and discussing with others on March 28 lends much support to the propositim that Miller was aware of much more than he has been willing to admit to and that he reported to State and Federal officials. One crucial point was the significance attributed to the early morning events.

1

,4

65. The Board erred in 1476 in not pursuing a further inquiry with Mr. William Dornsife into what information he was told March 28.

67. The Board's conclusion in 1 478 that it could identify no evidence in any investigation that Licensee's actions indicate a managment decision or a conscious desire to mislead, is unsupported by the record.

In a 9 A.M. phone ocnversation, Miller told William Dornsife of the Pennsylvania Bureau of Fadiological Protection that a) the PORv had been stuck open causing a IIX%; b) the HPI was initiated; c) the pressurizer may have voided; d) probably a slight amount of failed fuel; e) all safeguard systes operated. Dornsife has stated that based upon that report, he believed the plant was stable. IE interview, i

10-1-80, pp. 14-15. But Miller failed to mention the following facts: a) the PORV had ,

been open for two hours and twenty minutes, or at least an extended period of time. .

l Dornsife only recalls knowledge that it was open for a longer period of time than normal

,Id., pp.11-14, which did not necessarily imply a serious situation; b) the HPI  ;

had been throttled; c) hot leg or thermocouple data, or the existence of super-heated conditic .s; d) that core uncovery was suspected; e) that mergency systems  :

were not functicning in accordance with procedures and that in fact, the plant was I in a condition wholly outside procedures; f) they did not know how to bring the plant stable. Inmediately after speaking to Dornsife, Miller called QA manager George Troffer in Reading , "Right now, in addition to the plant obviously experienced a pressure and taperature change fairly fast. I didn't say this to th m... I'm just saying it to the group." Staff Ex. 5, Att.112.

63. The Board erred in 1 475 in not relying on Mr. Gerusky's IE interview for the truth of his assertions.

73. Board mischaracterizes and ignores TMIA's arguments in 11 494-497 concerning the cmpetence of Messrs. Miller and Herr;ein.

74. The Board conclusion in 1497 that Mr. Herbein's poor judgement is no basis for finding him inocmpetent is arbitrary and capricious and an abuse of discretion.

76. The Board's reliance in 1 497 upon the fact that new m ergency procedures will solve the problems which arose during tne accident, is not supported by the evidence in the record.

l l The false impression of stability was reiterated by Miller and Herbein in a raceting with the Lt. Governor and Thmas Gerusky at 2:00 P.M. in the Lt. Governor's i

- office. It should be noted that Herbein's decision to pull Miller off-site at that time has been demed a serious misjudgmenti jeopardizing the public's health and i safety. Staff Ex. 5 at 46. the Board never examined the intelligence of Herbein's decision, and never questioned him for his reasons. It should also be noted that Lic-ensee not only failed to reprimand Herbein for this reckless decision, but saw fit {

to reward him by placing him in the highly critical position of GPU Vice-President l, for Nuclear Assurance, and that the Board fully supported Licensee for doing this.

In light of evidence that he also withheld inportant information frcm the State, this is pointed illustration of Licensee's lack of concern for the public's health and safety, and failure to attach significance to an individual's obvious integrity deficiencies.

'Ihe Board, who never called on Gerusky, declines to discuss his statements to IE . 1 475. In his 10-1-80 interview with IE investigators, Gerusky made the following observations:

"'Iheir attitude was, " Don't bug us, we know what's going on and we can handle it" "the accident was over, in effect, and now all it was was clean-up."

"I don't know what you people are interested for." "We are going to handle it, its none of your business."

"I think they gave the impressicn that they had things under ccntrol."

"I was very disgusted, that it was a typical utility trying to play down a nuclear plant probim."

"I think it was more of an attitude than anything else."

This attitude, reflected by Miller and Herbein as the ocznpany manag m ent repre-sentatives, can be cured neither by rm oving Miller and Herbein as Licensee has (

finally done, nor by merely instituting new procedures. (See, S III for a discussion i

of Licensee's consistent disregard for even required procedures) Miller and Herbein's runoval does nothing to exonerate the corporate entity whkwas ultimately responsible for conveying vital information tlnt day.

68. The Board in 5 490-497 was derelict in its duty to resolve Board Issue 10 by not thoroughly investigating Herbein's role in the connunication failures during the accident, and how this reflects on his current qualifications , and errs in blaming intervenors for not litigatingfr questioning on the issue.

72. The Board's conclusicn in 1 493 that the public's health and safety would not be adversely affected by failing to conduct its own investigation into Herbein's role in information disclosure, is arbitrary and capricious and an abuse of discretion.

I As far hs Herbein's role, the Board's analysis is inexcusable. The Board blamer the intervenors for not litigating the issue. 1 506. The Board grossly errs in hiding behind the inability of any unfunded intervenor to put an entire case together to develop a record on an issue which the ccmnission had directed the Board j i

to consider. The Appeal Board should view the Board's conclusion in 1 491 as a total 4

abdicaticn of its responsibility to the Ccmnission and the public. Were is '

possibly no more important issue than whether Licensee chose to place an individual in a top nuclear safety related position,3d in line as Bncrgency Support Director, who had deliberately lied, and misled State and Federal officials during an emergency situation. The Board errs in attaching no significance to this issue.

Another major fault with the Board's decision cn this Board issue is the failure to examine how individuals interpreted what exactly was going cn on March 28, 1979, why things were misunderstood, how they handled what was happening, why they responded inappropriately, and what was, in theih nund, their primary concern.

Each of the investigations which the Board has read concluded that individuals responded inappropriately to the open POIN, the hot-leg and tivnnvvmple data, the pressure spike which occurred at approximately 2:00 P.M. It took fully 16 hours1.851852e-4 days <br />0.00444 hours <br />2.645503e-5 weeks <br />6.088e-6 months <br /> before a relatively stable cooling mode was achieved, and for the plant personnel to be certain of what was happening. l I

61. We IE conclusicn that there are no renaining items raised by IE's investigaticn of the accident which indicate an inadequate response, does not support a Board finding in 1468 that managernent has corrected all deficiencies revealed j during the accident.

78. The Board erred in 11 504-506 in accepting the record as is.

The Board's treatment of managanent's respcose as it related to their canpe-tence in handling the accident, is minimal. They do cite)he Rogovin Report conclusicn that the inability of the utility's managanent to ccmprehend the severity of the acci-dent was a serious failure of the canpany's managanent.1483 But the only other discussion can be found in 1468 which cites the IE ccnclusion that no noncanpliance itans reamin open. mis provides no factual support for the conclusion that managenent f _

1

• now has the technical capetence to understand and properly cope with an accident.

77. The Board erred in 9 501 in not pursuing the issues of whether Mr. Herman j Dieckamp made one or more false statements in his mailgram to Congressman l Udall End its conclusions that Dieckamp believed the statement to be true when made is contrary to the evidence.

Further evidence of the Board's failure to recognize individual performance '

problems in connection with the accident, concerns a mailgram sent to Cmgressman Morris Udall, Chairman of the House Cmmittee cn Interior and Insular Affairs m i

May 9, 1979, by Mr. Herman Dieckamp, President of GPU. The mailgram stated that l 1

"there is no evidence that anyone interpreted the ' Pressure Spike'... in terms of reactor core damage at the time of the spike nor that anycne withheld any informaticn."

Staff Ex. 5, at 45, App. B at 117-1. .

The IE investigation concluded that the IBC was not informed of the pressure spike until March 30, 1979, two days after the incident occurred. (The spike evidenced a hydrogen explosim which occurred at 1:50 P.M. on March 28) . Dieckamp was not specifically cited for making a material false statenent under S 186 of the Atcmic Energy Ict .aecause the statement was neither made in a licensing application or a statenent of fact required under S 182 of the Act. Yet it is clear that the statenent can be considered materially false under normal standards. Tr.13,061 (Smith) . ,

The Board noted at Tr. 13,060, that "the IE people really leave it dangling," and "as far as the Board is concerned, and as ftr as I would imagine the intervening parties and the public, it seems to me that tliere should be a further inquiry or further explanation."

Yet not only does the Board fail to conduct a further inquiry, it never even questioned Mr. Dieckamp on the incident when he appeared as a witness later that month.

See, Tr. 13,438 et sea. Neither the Licensee nor the Board has adclowledged wrongdoing by Dieckamp, let alcne sanctioned him. Clearly, questions surrounding this incident must be resolved and the Board errs in not doiing so, t 498-503.

'Ihus, the Board has not resolved the issues raised in Board Issue 10.

., v -

. III. REOPENED PROCEEDINGS A. The Board's decision can not be used as a basis to supoort restart.

THOSE FOUND TO HAVE ENGAGED IN IMPROPER CONDUCT INCLUDING ACTUAL CHEATING OR GIVING NONTRUTHFUL TESTIMONY Additional Additional By Judge Milhollin Sanction by the Licensing Board Sanction (Special Matters Report) Rs.a ussided (Partial Initial Decisicn) Es.wn.arded Robert C. Arnold, Pres., John Herbein, former VP GPU Nuclear 1237 GPU Nuclear 12306 John Herbein, former VP, Gary Miller, former head GPU Nuclear 1 233 Start-Up & Test 12272-2320 Gary Miller, former head W, former Supervisor of Start-Up & Test 1 220-237 Operaticn, U-2 1 2272-2320 W, former Supervisor of Mr. Ship:en, Sen. Op.

Operation, U-2 1 220-237 Engineer, U-l 1 2139-2146 Michael Ross, Manager Mr. Husted, training Operations, U-l 1 137-178 instructor 1 2148-2168 Mr. Shipnan, Sen. Op. Qualified renoval O, Shift Super. 1 2090-2095 Engineer, U-l 1 94-110 licensed duties W, Shift Super. 1 2090-2095 Mr. Husted, training Unspecified ine'.ructor 1 101-111 sanction GG, Shift Fore. 1 2133-2137 0, Shift Super. 1 10-25 Referral for G, CFO 1 2096-2121 Two wks.

crinunal prosecuticn susp.

W, Shift Super. 1 10-25 Referral for H, CBD 1 2096-2121 without criminal prosecuticn pay I, Shift Super. 1 24 A, Shift Super. 1 24 i i P, Shift Super. 1 107-108

! U, Shift Fore. 1 112-132 Unspecified sancticn GG, Shift Fore. 1 82-93 Unspecified sanction Rmoval G, CPO 1 26-77

licensed duties l H, CFD 1 26-77 Rmoval I licensed duties FM, STA 182-93 l

The above chart illustrates two principle thmes which have developed frm the evidence on. cheating episodes and related issues, known as the " reopened practWings."  ;

First, that according to Licensee's definition of managment, i.e., "exspt (non-union) employees" Tr. 23,622-25 (Arnold) or shift foremen and above, cheating and false testi-mony involved primarily the middle and upper ranks of the operations department and managment. Secondly, there is a wide difference between how the evidence was inter-preted by the Special Master who presided over the hearings, and the Board, who merely reviewed the printed record. L Specifically, there is a significant difference between the type of conduct which the Special Master recognized as lying and cheating, warranting punishment, and that which the Board recognized as such. Upon reviewing the PID and the Special Master's L Report (SMR) in light of the record of these proceedings, it is clear that the Board is not only blind to patently obvious wrongdoing by operators or managment responsible for the safe operation of a nuclear power plant, but that it sees no worth in disciplining those who even acknowledge to having ccmnitted wrongful acts. Further, the Board has violated fundamental legal principles by reversing the Special Master's findings which were based on witness credibility.

In sm, the final PID's conclusion that management is ccupetent to operate Unit 1, and that the training department is adequate to insure safe operation, is unreasoned, arbitrary, and unsupported by the plain facts on the record. It can not be used as a basis to support restart of Unit 1.

B. Geating and wrongdoing at 'IMI was far more widespread than recognized by the Board, and the Board erred in reversing the findings of the Special Master.

Cheating and other wrongdoing at TMI-l was widespread and involved all levels of the operations and managment staff. In the face of substantial evidence and the Special mster's conclusion, the Board has refused to recognize certain highly signi-ficant instancet of wrongdoing. A number of the Board's conclusions are without justification in law or fact, and are based on invalid legal principles.

1. The Board's reversal of Judge Milhollin's findings on 'IMI-l Manager of Operations Michael Ibss, in which Judge Milhollin found that Ross improperly kept the NBC proctor out of the exam rocm during the April 1981 licensing exam, and improperly broadened the answer key, is arbitrary and capricious and contrary to law.

TiTA has consistently supported the Special Master's findings and ccnclusions on the Michael Ross issues, located in the SMR, $1 137-178. See, 'IMIA's Carments on Special Master's Report and Atmic Safety and Licensing Board's Tentative Final Draft Decision, at 2, 3, May 24,1982. His findings are entirely supported by the record, and are based substantially upon an evaluation of the credibility of the witnesses who testified on the issue.

'Ihe Board's first PID on managment issues,1ssued after months of hearings, fully supports the cmpetence of each corporate and plant manager. (See, discussion, SII, C, 1) Judge Milhollin's conclusions challenge the PID's findings on Ross, and i are extrmely damaging to the Licensee. Ibss supervises the entire operations staff at TMI-1. PID 1 76. As the Boani stated in the first PID, and restated in the July 27, 1982 PID, "Poss may be the nost important persm of the 'IMI-l operating team with respect of public health and safety." 12192. If the Board had accepted the findings i

i' and conclusion of Judge Milhollin on either the " keeping the proctor away" issue, or the

" broadening the answer key

• issue, it clearly could not support restart with Ross continuing as 'IMI-l Manager of Operation. In addition, the Board would have been required to examine why Ross was placed in so crucial and influential position, why he has rmained there, and what were the effects of his attitude and lack of integrity on the operaticns staff he supervised.

Moreover, the Board would have had to renege on its prior glowing approval of l

l Ross in the first PID. H 154-156. This would have reflected poorly on tlya Board's own credibility and would have raised doubts about the plausibility of the Board's mathod of analysis of all 'IMI-l corporate managers under Board Issue 1. Thus, the Board's interest in rejecting Judge Milhollin's findings and conclusion on Ross was especially keen, since the reliability of the first PID's conclusion regarding the cmpetence of individual managers was at issue.

• kJnder the circumstances, only a highly disinterested and impartial Board would have found support for Judge Milhollin's credible and well supported findings. Given this Board's record of bias in favor of the Licensee and its interest in not disturbig the first PID, which supports restart, it is not surprising that it exonerated Ross of all wrongdoing, violating fundamental legal principles to do so.

a) The Board errs ni reversing Judge Milhollin's findings which are entitled to great weight, Exceptions 1, 72, 78, 80, 86

• The Board itself selected Judge Milhollin to preside over the reopened proceedings because of their " informed confidence in his ability and fairness," and because of his expertise in the field of education and exam.ination at high academic levels. The Board recognizes the thoroughness and careful reasoning and documentation of the SMR.

1 2034. i-Apart fran the purely legal considerations,ccmnon sense would dictate that l l

Judge Milhollin's expert.ise in the field of education, canbined with his knowledge of nuclear regulation make him extranely canpetent to asses the evidence pertaining to examination content and procedure. But in addition, Judge Milhollin did not utilize his e W. as a mere reviewer of the printed evidence. He presided over the hearings, took an active role in examining the witnesses, and observed witness deneanor. This Appeal Board, upon reviewing the record, need not adopt the findings of the Board, but may subsitute its own judgenent as we have urged it to do througtout this document. Duke Power Co. , ALAB-355, 4 NRC 397, 483 (1976) . But it is also true that "where credibility of the evidence turns on the deneanor of a witness, the [ Appeal Board] will give the judgement of the hearing Board which saw and heard It is certainly his testinony, particularly great deference." (enphasis added) . Id.

equally compelling that the judgenent of a Special Master, performing the identical hearing functions as a hearing board , be entitled to equally great deference if based upon witness deneanor.

ceptions to the Pareial Initial Decision of the Reopened Proceedings are listed in Appendix A.

. Irleed, the NPC rule reflects a fundamental administrative law principle. The Suprene Court has ruled that the findings and conclusions of the judge who presided over the administrative hearings may not be ignored, and "the evidence supporting a conclusion may be less substantial when an unpartial, experienced examiner who has observed the witnesses and lived with the case has drawn atmclusions different frtxn the Board's than when he has reached the same conclusians." Universal Camera Inc. ,v.

National Iabor Relations Amrd, 340 U.S. 474, 496 (1951) . And when the hearing judge's findings rest directly on his own personal observation of a witness' deneanor, findings and conclusions reversing the Special Master becrane significantly less substantial, or " tenuous at best." See, e.g. Ward v. N.L.R.B. , 462 F.2d 8,12 (5th Cir.1972); Dolan v. Celebrezze, 381 F.2d 231 (2d Cir. ,1967) .

In this case, the Board reverses a number of Judge Milhollin's findings and conclusions, par +icularly those which are damaging to the Licensee, and which could not be used to support a restart decisicn. Many of these findings turn directly on witness credibility. His findings on the Ross issues are based substantially upcn l

-an evaluaticn of the credibility of the witnesses who testified, particularly Ross and YY.

b) 'Ihe Board errs in reversing Judge Milhollin's finding that Ross deliberately kept the pwcLOr out of the roczn to facilitate cheating.

Excepticns 69, 71, 73, 74, 75, 76, 77 The relevant facts to this issue are as follows:Ibss participated in a review of test questions and proposed answer keys with the NBC proctor and two training instructors, Boltz and Brown, during the "B" set of NIC exams on April 23, and 24, 1931. The utility officials had all taken the "A" set of exams on April 21 and 22,1981 -

thus, all were license candidates and were reviewing answer keys on the exams they had just taken and which were fresh in their mind. A number of current operators, Ibss' subordinates, testified that scxnetime during or after the two day review, Ross told than in a conversation in the shift supervisors office, such things as " don't worry, you did all fight," or "I took care of that job," after which everyone " chuckled." SMR S 143.

- Srh,i Mr. KK, believed that he thought that Ross meant that he had made the answers more " fair." SIA, Mr. RR, thought Ross was untruthfully bragging, meaning to cheer people up. Staif Ex. 27, at 27-28.

Mr. W, however, who is no longer employed at TMI, heard the same conversation.

He testified, unequivocally and in contradictionto the Board's analysis in 12201, that based on his knowldge of Ross, he believed Ross mechtthat hr. hsd kept the proctor out 11 of the rocxn to facilitate cheating.Tr. 26,015, 16, 26,. (W). ,

Unlike the Board, Judge Milhollin had the unique vw.n.Lunity to observe Mr.

i Ross' deneanor testifying as an individual standing accused of gross and improper j i

conduct. Ross, of course, denied any wrongdoing. Judge Milhollin also had a chance ,

I to assess Ross' credibility in the context of other witness' testimony on the same  ;

I-s0 ject, including that of W, Mr. Bruce Wilson (the proctor), Mr. Ross' subordinates f I

who would very understandably not wish to " point the finger" at their boss (using the i t

Board's own words in 12043), and other Licensee anployees. On this basis, and by j thoroughly analyzing the entire evidentiary record, Judge Milhollin reached his ccnclv- l

[

sions, finding, among other things that Ross was a totally non-credible witness. SMR 1 147. I t

1 Judge Milhollin's conclusions on the cr Mihility of Foss' denial of wrongdoing  ;

e are supported by an analysis of his testimony in light of what independent evidence  ;.

indicates he knew at the time. Evaluation of such circumstantial evidence is entirely appropriate. As the 4th Circuit has noted, " direct evidence of a purpose to violate a statute is rarely obtainable." N.L.R.B. v. Rednont Wagon and Mfg. Co. ,176 F.2d 695 (4th Cir. , 1949) . As the Special Master shows, Foss' testinony is inccnsistent with known facts. SMR 147.

One can draw cne of two conclusions - either he was not being honest, and he certainly had a motim not to be , or he forgot the facts. But ultimately, the conclu-sion rests on an evalcation of Ross' daneanor at the tino of his testinony. Only Jugde Mi.lhollin observed Poss' daneanor. He concluded Ross was not credible in his response to W's allegations. The Board's rejection of Judge Milhollin's conclusion, deciding to attribute the problans and inconsistencies in Ibss' testinony to " faulty

recollecticn," 5 2208, is arbitrary and capricious, and totally without support.

The Board's reasoning in 1 2209, apparently based on an explanation supplied by the Licensee , mischaracterizes Ibss' testimony. We Board insists that the credi-bility problens of Ibss' statement that he never learned whether changes in the answer key were ever adopted, found particularly non-credible by the Board and Judge Milhollin, i i

1 2208, have been cured by Ross' statenent at Tr. 24.334. 'Ihe Board says that Ross t

testified that he did at least " assume" changes were made. However, Ross merely says the he " assumed" that Boltz and Brown " assumed" changes were made. Ibss never made the statenent the Board has attributed to him.

The Board also raises the point that perhaps Ibss' testimony appeared non-credible i because he never understood the charges against him, and therefore could not formulate a credible defense. This is equally without justification. W's written statenent, which he adopted as his testimony at the hearing, Tr. 26,008, (W), was available to Ross weeks before the hearing. Ross had ample opportunity to read and understand these allegations,which did not change throughout his oral testimony. Ibss answered questions at the hearings on W's alegations, without objecticn, and counsel for Licensee never requested Ross to return to the stand after W had testified,or objected to the questioning of either Ross, W, or Mr. Bruce Wilson, the NFC proctor.

Here is no basis whatsoever for the Board to imply that Ross could not meet W's charges.

Further, the Board's analysis of W's credibility which Judge Milhollin found honest and forthright, SMR 1 151, is without any basis. The Board never observed W's demeanor, yet finds his accusations incredible, contradictory, and unreliable.

1 2205. 'Ib buttress its argtrnent, the Board misconstrues much of W's testimony.

For example, the Board in 9 2203 says that W "seans to state that any unfair advantage to the test candidates was an incidental result of normal procedures." To the contrary, W never said that he believed improperly broadening answer keys was " normal."

Tr. 26,022. Also, the Board incorrectly states that W's statenent is " equivocal."

t 2201. The Board is wrong. W's statenent, which was based on his personal knowledge

of Ross, stated quite plainly that he believed Ross meant that he had, in fact, kept the proctor out of the rocm to facilitate cheating, despite how others may have interpreted the reark. Tr. - 26,015, 16 (W) . 'Ihe Board believes that W's statment was contra- ,

dicted by the statements of KK, GG, and RR.12206. With regard to GG, he has never  !

l testified that he even heard the r eark in the shift supervisor's office. Tr. 25,688-9 j (GG) . As to KK and RR, the Board attaches no weight to the fact that these people are still sployed at 'IMI and under Ross' direct supervision, and thus would have a treendous interest in interpreting events according to their own interest. But even more, the Board fails to mention that in RR's written statm ent, he indicates that everyone " chuckled" after hearing Ross make his announc ment. Staff Ex. 27, at 27-

28. SMR 1 143. Chuckling connotes glee, even a sinister glee. It is not the type of reaction one would expect of those in the shift supervisors office if they had also interpreted Ross' statement to mean he had " fairly broadened the key." RR's statment is also consistent with W's inpression of Ross' being "almost ecstatic." Tr. 26,011 (W) .

As Judge Milhollin points out at SMR 1 152, nor is it reasonable to conclude that Foss was untruthfully bragging, i.e., pretending to have an inproper motive,

~

merely to cheer his crew. "The absence of a proctor was not a benefit to the candidates in the srtoker's rom. P... was angry about the absence of a proctor...

He said it 'put him in the uncanfortable position where he could be solicited by other examinees. '" Id. P's sentiment was consistent with that of other operators who had emplained about smeone being available outside the exam roan to answer questicms.

Tr. 26,218(0) . "It is difficult to see how Mr. Ross could believe that honest i operators would welcme the absence of a proctor." Id. It makes no logical sense that Ross would have chosen this approach to boost morale. Therefore, the only conclusion cne can draw is that he intentionally did what W said he did.

Further, the Board does not support its assertions with evidence of malice by W towards Ross, or any reason why W wculd not be truthful. In fact, W 's credibility is strengthened when one considers the risks W took by voluntarily contacting the l NIC when he did, and the personal jeopardy he has been in since the initial call,

evidenced by his insistence on total confidentiality. Judge Milhollin's analysis speaks for itself.

'Ihe Board fails to give any adequate explanation of the grounds for reversing the Special Master's credibility determination, and thus, the Appeal Board, under the principles of Duke Power Co., supra , must support the findings of Judge Milhollin on the issue of Ross' intentionally keeping the pro @cr out of the rocm in order to aid candidates to pass the exam.

c) The Board erred in finding that Ross did not inproperly broaden or attempt to broaden the answer key.

Exceptions 81, 82, 83, 84, 85.

To exanune whether the evidence supports a finelng that Ross improperly broadened the answer key, Judge Milhollin selected tselve questions frcm the 'A' exam, which Ross had both taken and reviewed, where answer key changes were made or suggested during the subject review. He found that on the answer key to question B.S.a of the BO 'A' exam, a major change was made. SMR 1 156. The Board disputed this finding. 1 2220.

Upon reviewing both Judge Milhollin's analysis and the Board's the Appeal Board will note that the record is unclear as to which answer to B.S.a. is correct, 1 2220, or what response the NBC was looking for, in light of the mnfused and stilted language of the answer key. However, the Board is clearly incarrect when it adopts Licensee's weak and illogical " solution to the puzzle," 1 2217, which suggests that the aittian j of the phrase "(lowers seal #1 A P)" placed above the first clause of the first ['

l '

sentence, represents the reviewers response to the 2d part of the cpesticn, and replaces the deleted 2d sentence . It is obvious that the parenthetic phrase (lowers seal #1 A P) is intended to clarify the phrase "Iowers pressure in the #1 seal area," and is i merely a redundancy of that phrase. It does not satisfy the 2d part of the question.

As .Tudge Milhollin correctly pointsout,the reviewers eliminated the 2d part of the question, arguing that it was not part of training at 'IMI. Nothing was subsituted for the deleted portion of the answer. TMIA stands by Judge Milhollin's analysis.

Similarly, 'IMIA supports Judge Milhollin's analysisof the attempted answer key l

l

change on question C.2.b. The Board has concluded that the suggested answer key change i by Ibss and Boltz was improper. 1 2222, SMR 1 166, yet they aho conclude, with ,

1 absolutely no factual support, that the suggestion was made in good faith. Perhaps if no other evidence existed to indicate bad faith, the Board's unsubstantiated asstmption might be considered reasonable, this is not the case, as the Special Master's analysis correctly demonstrates. 'Ihe proposed change made no logical sense, did not reflect the training program, andcould have helped practically no me but the reviewers themselves. SMR $1 161-166. The Board's predetermined decision to exonerate Ibss, is a wholly arbitrary and capricious wnclusion.

Further, Ross should be held fully respmsible for the improper changes and suggestions. The fact that no accusations were made against Boltz or Brown, 1 2198, is irrelevant. Not only was Ross the most senior Licensee official to review the exams, SMR 1 178, he was the only one of the three, against whm . incriminating allegations were made. As Judge Milhollin correctly concludes, Ibss's ccnduct as Manager of Operations of 'IMI-l must be imputed to the Licensee. 'Ihe Board's findings must be reversed.

2. The Board erred in reversing the finding that Mr. Husted, 'IMI-l training instructor, solicited an answer frcan P during the April, 1981 NBC SIO exam.

Exceptions 43,44,45,46,47,48,49,50,51,52,53,54,55,56,57,58 The Board's dismissal of the alleged solicitation of P by Husted during the ,

i April NIC exam, in a 50% unproctored room in which they sat alone, is unsupported by l l

the facts which turn directly on credibility evaluations.12157. 'Ihe evidence l reveals that two highly profescional and totally credible NIC investigators, Messrs. ,

F Ward and Baci, were told by P during the NIC's investigation, that Husted solicited him. Both Ward and Baci appeared at the hearings, and Ward recited the events as they happened. Baci disagreed with none of Mard's testimony. Ward had concluded that P was forthright at the time, based on their observations of P's dmeanor. Tr. 25,320 (Ward). .

P changed his story during the hearings, and denied not only that the solicita- (

tion occurred, but also that he ever told this to the NIC investigators. Tr. 26,691-2 (P) .

P's account of the NIC interview is highly confusing and incredible, particulary

cmpared to Ward's account which he recalled "with particular clarity." Tr. 25,462-5 (Nard). Ward stated that P was reluctant to discuss Husted's solicitation, and in fact, Ward had to trick him into the admissicn. But once P's admissicn was made, Ward said that P had no reluctance to divulge the nature of the test question.Id.

Ward made a definite inference that the question came off the exam. Tr. 25,463-4 (Ward) .

His testimony was very specific and does not pennit an inference of confusion or misinterpretation. 11 2121, 2155. e P's account cn the other hand, is hardly credible and even the Board calls it " illogical." 2155. He suggests that the investigators suggested to P that Husted had asked him a question during the exam, and then, they just dropped the subject i I

without getting an answer. Tr. 26,691-2. P also suggests that he dropped the subject, despite earlier expressions of anger ccmcerning the fact that his exam rocm was unproctored, and this made him vulnerable to solicitation. Staff Ex. 27, at 40.

Judge Milhollin does extensive analysis of P's credibility, including observations of P's demeanor, and finds that P was not forthright in his testimony. Husted, who denies the solicitation, is found by Judge Milhollin and by the Board to be entirely noncrMihle and uncooperative 12165. The Board refuses to even analyze Ph or Husted's credibility with respect to this incident. 1 2158.

Further, the Board infers, without basis, that Husted may have merely been asking P for a clarification.12156. Husted's own testimony, however, can not sustain such a finding. He stated at Tr. 26,944, that when the proctor was not in the rocm and he needed a question clarified, it would not have been a burden for him to leave the roca to find him. In fact, he stated, "It is nice to get up and stretch once in Tr. 26,944.

awhilewhenyouaretakinganingfourlongexamorasixhourexam.

Itreover, the Board concludes that Mr. Ward's story is uncorroborated and entitled to no weight, since Mr Baci, who sat beside him at the hearing, did not speak on this issue. 11 2153, 2154. This is absurd. The Boarn provides absolutely no explanation why it believes a highly credible and cmpetent investigator like fir Baci would sit in silence beside another investigator as he testifies falsely about an incident

. involving both of th m. The Board cmpletely fails to disclose the factual basis for this conclusion, violating the fundamental administrative law principles of S.E.C. v.

Chenery Corporation, 318 U.S. 80 (1943) . The Board errs in finding Mr. Ward's testimorrf uncorroborated.

While Ward's testimony is technically hearsay, it is well established in admini-  :

f strative prevwvi%gs that hearsay can be accepted as reliable, probative evidence if .

other better evidence is unavailalbe. Willaport Oysters, Inc. v. Ewing, 174 F.2d 676 (9th Cir.1949); N.L.R.B. v. Reingtcn Rand, 94 F.2d 862 (2d Cir.1938) . Both P and Husted are non-credible witnesses. Husted in parH< ile has evidenced such cunplete disrespect for the NBC regulatory process that the Board concludes, "his attitude may be a partial explanation of why there was disrespect for the j training program and the examinations." 1Tr. 2167. In such a ciremstance, it is clear that Mr. Ward's unequivocable and corroborated testimony, althotxJh hearsay, should l be accepted, and the Board should find that Husted indeed solicited P during the April NBC exam. The Board's arbitrary reversal of Judge Milhollin's findings without adequate, independent reasons for doing so, is an error of law.

3. The Board erred and violated due process in relying on evidence outside the record to excnerate fM.

Exception 30 Only a limited number of operators testified at the hearings. Despite the Board's unsubstantiated conclusion that "it is prnhable that almost all, perhaps all, of the cheating of any inportant relevance to this proceeding has been identified." 12041.

'IMIA believes that the cheating episodes <Hae'laned in the decision are just as likely, if not more likely, to be representative of episodes which were nct the subject of inves-tigation. (See, S III, E) When the Board arbitrarily and capriciously finds that cheating incidents did not happen, and makes assuptions ccnsistently in favor of the Licensee, it not only violates the public trust, but also prejudices the intervenor's case, violating their basic right to effectively participate in the hearing process. One way the Board was able to do this in the reopened proceedings was by " recognizing"the

standing of the individual operators mentioned in the SMR, to cxxtment on the report, ,

and by using those self-serving explanations to exonerate then. (See, Menorandtrn and Order, dated May 31, 1982). 'IMIA objected to the solicitation and use of such ocxtrnents. See, ' INIA Carments, supra, at 2, 3.

One of the clearest examples of this abuse of process, concerns operator m.

Judge Milhollin found that m was involved in cheating on the quiz of Decenber 19, 1980. SMR 1 82-93. m submitted ccxtments in response to the Board's solicitation,  ;

i containing self-serving, unsupported explanations, upon which the Board relied in exonerating M.12132, Fcotnote 232. The Board's reliance on these ccxtments violates i and is an affront to due process. As the Suprene Court has ruled,". .. nothing can be treated as eviden which is not introduced as such. Morgan v. U.S., 298 U.S. j 468, 480 (1936). See, also, Republic Aviation Corp. v. N.L.R.B. , 324 U.S. 793, 800 (1945) ;

Seacoast Anti-Pollution league v. Costle, 572 F.2d 872, cert, den. 99 S.Ct. 92 (1978) .

I In this case, substantial prejudice resulted. U.S. v. Pierce Auto Freight Lines, 327  !

U.S. 515 (1946) . 'Ihe Board has drawn a Itajor conclusion that based on the cheating it has found, the overall integrity of the operations staff is ade' , te, e.nd no safety consequences due to cheating exist at the plant. Thus, it authorizes restart.

Obviously, the Board seriously prejudices the case of theintervenors by finding that any particular individual uas not cheated, based on materials outside the record, when the evidence on the record clearly establishes that the individual has cheated.

SMR TV 88-93. The Board's findings on m must be reversed.

4. The Board's conclusion that W copied from GG is unsupported and prejudicial to 'IMIA.

Exceptions 31, 32

'Ihe Board admits that cooperation existed between GG and W on the same quiz question as that involving m. The relevant issue is, who was the aggressive cheater.

Lic. Exs. 661 and 66 m show that the first wrd of GG's respcnse was deleted before the response identical to W's was gives while the same was not true for W. Tr. 24,569 (Wilson). In addition, W, who denied copying fran GG, had no motive to render untruth-ful testimony. W has adntitted to cheating on the April 1981 exam as well as to cheating

on weekly quizzes Tr. 26,145-6 (W) . It makes no logical sense that he would untruth- ,

fully deny copying in this instance. GG also denied copying, but in light of other evidence, Judge Milhollin found GG's credibility " undermined." SMR 193.

The Board's admittedly weak inference that W copied frm GG is totally without support. 1 2134 Once again, the Board makes anarbitrary asstmpticm favorable to Licensee despite evidence in the record to the mntrary. This finding should be reversed and the finding of Judge Milhollin's adopted. ,

S. The Board errs in not finding that U stationed himself outside the j exam rom to aid candidates in answering questicms. i.

l.

Exception 40, 62, 63, 64, 65, 66, 67, 138 U was assigned to training during the entire week of the April NBC exam. Under j normal circtznstances, he would have been taking classes with the Cat. IV trainees.

Staff Ex. 27, at 37. However, as shift forman and a msnber of management, he had some degree of freeds as to where he would study. U testified that after taking the

'A' set of exams, he spent Thursday and Friday of that week in the training center, while l the 'B' set of exams were in progress, .or the purpose of studying for an oral exam which he understood at the time to be scheduled sme four nonths later. Tr. 26, 829-30.

Other operators testified that they could not isragine doing such a thing inmediately b

after having taken the grueling two day NBC exam. Tr. 25,713, Tr. 25,771 (G) , (GG) .  !

! T, who was also assigned to training that week testified that operators so assigned were given no direction concerning their training assignments. T spent sme time in the training department studying " heat transfer." He moved frem office to office and spent about two hours in Husted'c office with U on one of the two days the B exam was in progress. Tr. 26,601,2. He recalls that U was in the office about 50% of the time that he, T, was there. Tr. 25,617. T chose to study in the control rocm on cme of the days in question, Id., however, U headquartered himself in Husted's office on both days. T testified that everyone connected with training i was in the training offices during the day he spent there. Tr. 26,600. t l

l U testified that while he was in Husted's office, about50 oeople stopped in.

l Tr. 26,827 (U) . Enpty classrooms were available and the control rocm seem also to have i

been an optim, and a logical one since S'IA's and other knowlegeable people would have been available to answer questions.

Contrary to the Board's claim, Husted often allowed operators tause his office as a place to study. The office contained an extra table. Tr. 26, 920. U however, had never used Husted's office for this purpose before. Tr. 26,876 (U) . U would have cne believe that he, who was supposedly so diligent that he began studying for an oral exam scheduled for four months later, Tr. 26,829-32 (U), chose a location which was  ;

the least conducive to study, where he had never studied before and has never studied  ;

since. Tr. 26,876 (U). Judge Milhollin errectly finds U's stated reasons for being I in Husted's office not credible. SMR 119. Judge Milhollin also recognizes that j Husted's office was a good place frm which to give exam assistance. SMR 5119.

00 testified that U approached him at the coffee stand with an offer of help on the exam. 00 was an extremely cautious witness, careful not to make stat m ents of which he was unsure. He had nothing to gain fr m his admission of U's offer.

Judge Milhollin found 00 to be a most credible witness.

l The Board decides that Judge Milhollin's credibility determination of 00 is not reasmable, stating, "00's subjective interpretation of U's unstated purpose in approaching 00 is too far rmoved frm our ken to be the basis for a reliable conclusion." 1 2177. Yet the Board itself concedes that Husted's office was a good l

( place frm which assistance on the exam could be given, 1 2176, and recognizes l that U himself testified that he may have unknowingly provided smecne with a short l

answer during the examination, that providing a short answer would not in his view ha cheating, and that it is "not unlikely" that an exam-taker could have received an i

answer while U and others were in the hallway outside the examination rom.12178.

l

'Ihus, the basis of the Board's emclusion rests on its finding that 00 misinterpre-l ted O's action. It empletely ignores the evidence on the record which supports the strong inference that U was not in Husted's office to study, and that he stationed himself in that office during the B exam to assist examinees, and in fact, offered l

assistance to 00.

l L

Moreover, the evidence sustains the Special Master's conclusion that while in Husted's office, U called KK, and STA and asked hiRP a tecnnical question for the purpose of assisting an exam candidate. SMR 11 123-128. U testifies that he may very well have called KK with a question, but not the one described by KK. Tr. 26, 844, 26,846. (U) . In addition to evidence recited by Judge Milhollin, his conclusion is reinforced by the fact that KK's clear memory of the incident resultsCfranYtheIfact f that it was the first and only time that he had received a telephonic query about a technical matter, while at 'IMI. Tr. 26,479 (KK) .

While Judge M11hollin found insufficient evidence to establish that U was

" stationed" in Husted's office by managenent or others, the possibility that U stationed himself in the exam rom was not discussed in the report, nor thehossibility that managenent did have knowledge of Us activities at sme point during the exam itself.

The evidence supports this ccmclusion.

A nuuber of witnesses testified that they heard that smeme was available and 00 heard before the exam that scmeone would be posted. SMR 1 113. CO never specifically stated when he heard this runor, and it is certainly possible the 00 did not acquire this knowledge until 20 minutes before the ccmnencement of the B0/B exam when U discussed the A exam with the B examinees. Tr. 26,880. Mr. Husted had just that j morning given U permission to use his office. Tr. 26,916 (Husted) . It is reasonable to infer that U did not take on his role as voluntary assistant to examinees until IIme- [

! diately before the 10/B exam, and there is certainly no reason to assume that ,

anyone in particular had placed him in Husted's office.

KK's statenent that "the person [ stationed outsir'.e the examination rocm] was parforming his duty... with at least the knowledge of scmeone higher up in the

~

cmpany Staff Ex. 27 at 30, is found by Judge Milhollin to be unsubstantiated.

However, the statenent is consistent with other testimony if one does not necessarily infer that anyone had arranged for him to be there, nor that managanent had prmam knowledge that saneone would be there. It is actually likely that a managanent perecn 4

acquired his knowledge during the B exam, since during the exam review, Licensee

- - - - - - - , ..,,.---__.y _ . . ,--_ --,, -_.. ._._,_--,-n . , ,_,n-e ,_ , a - , _ , - . , _ , . - - . - - , , , , , - - -

reviewers frequently went in search of doctanentation to support their arguments. ,

Tr. 24,161, and Husted's office contained such docunentation. Thus, it is equally likely that one of the reviewers discovered, during an excursion in search of docu-menting material, that U had stationed himself in Husted's office for the purpose of aiding exam candidates. Keeping in mind the nunber of accounts linking Mr. U to questionable behavior which circulated in the wake of the April NRC exam, the evidence supports a conclusion that U was indeed stati:med in the vicinity of the exam to help answer questions, and that he did just that, and that managenent likely knew about it at least during the course of the exam.

The Board finds support for this conclusicn, but then rejects it. The Board's  ;

reascanng deserves special ccmnent. The Board deidul that U's "non-denial" should not be used to prove his involvenent in this incident, reasoning that when the " principle p hard evidence against a suspected malfeasant is his own testinony, ... [the Board should i

! not select testinony which) inculpates the witness while rejecting testimcny that excul-t pates hiln. " t 2184. As denanstrated above, a careful examination of the record reveals i 1

. t.

an abundance of evidence pointingdirectly to U's culpability, in addition to his own i "non-denial." ,

Even more significant, however, this new principle, which rests cn no dis-I cernable grounds other than the Board's twisted logic, is firm evidence of the Board's eager readiness to sanction cover-ups and lies by this ccmpany in the name of the public interest. The Board's rationalization is perhaps more fully explained in 1 2144 concerning events surrounding Mr. Shipnan (see, S III, C) where the Board resists sancticning Shipnan because he " volunteered the very information now bringing about the sanction" ..."and [t]here is a public interest in encouraging such disclosure."

1 2144. U, like Shipnan, testified at these hearings under oath. Each had an unqual-ified obligation to tell the truth. Each testified without hesitation.

Even the 5th Amendment to the U.S. Constitution,which protects as individual l

l from making incriminating statcraents, holds that once an individual waives his 5th Annudruit rights and tesifies, his statenent mla be used against him.

t

c- i t

By fornulating this arbitrary standard, the Board is thus telling the operators and the public that it is acceptable to cover-up cheating and to be untruthful about it, even under oath. It will not require the witness to tell the truth, if his testinmy is incrinunating. It will only require the truth if the testimony will not be damaging to the testifier.

The Board has thus refused to ackncwledge the substantial evidence of U's guilt on the basis of an invalid and irrelevant principle. The Board's finding nust be overtured.

C. We quality of the testimony rendered by Licensee witnesses included untruthful statenents frcm the upper managanent down to the lowest level of the operating staff, and was so poor that it evidenced a unmitigated lack of respect for thaentire NIC process, and a severe lack of . integrity by the whole ccmpany.

In the face of overwhelming evidence to the contrary, the Board fully supports the overall quality of the operators' testinony at the hearing.12043 The evidence of untruthfullness and disrespect for the NBC process ranges across the board- frcm l the highest levels of uppoer managenent to the lowest levels of the operating staff.

It dates back to at least 1979 when the Licensee subnitted a material falsa statement  !

to the NBC, and carried through the NBC investigation into the hearing itself. l l

1. 'Ihe Board errs in failing to recognize or attach significance to I the ncm-credible testimony given by Robert C. Arnold, President of GPU, in connection with the 1979 W/O incident.

Exceptions 111,113,114, 115 117, 118, 123

'Ihe incident involving W and O in 1979, perhaps most clearly demonstrates upper managenent's willingness to lie to the NIC. The incident itself is factually described in tt 2272-2274. It was an early indication of the need for better procedures and a better attitude toward training and testing by management. Robert Arnold, " CPU-' Presi-dent , expressed the view that a disciplinary action against an individual had two ipurposes:

to provide instruction to the individual,to provide instruction to the rest of the organization. Tr. 23,620-21. (Arnold). The W/O incident was the perfect opportunity to acccuplish these purposes through disciplinary action. Yet all the evidence supports the view that Mr. W was not disciplined for his conduct, nor was this incident ever l

i revealed to the operating staff.

i l

l l - - - . ._ ,

Gary Miller, Station Superintendent, and Jack Herbein, Met-Ed Vice President, the two managenent representatives who were primarily responsible for the investigation of the incident, reccmnended to Arnold that W be suspended for two weekstor his involve-ment in the cheating incident. Arnold rejected this suggestion, and at his insistence, Miller assigned W to a special group charged with obtaining a better understanding of the events which led to the 'IMI-2 accident. TMIA Ex. 54. W assumed the responsi-bility for ' technical interface' with the Department of Energy's Research and Develop-ment program at TMI-2, and with the Bechtel ccrnpanies who would do the actual dectrn-4 tanunation of Unit 2. Arnold asserted that this wasa demtion and would be viewed as ,

such by W and the organization as a whole. Tr. 23,620-1; 23,738, 23,772. (Arnold).

If indeed he and everyone else thought that W was demted, and understood why, it would comport with the view espoused by Arnold that discipline should instruct the indivi-dual and instruct the organization. Tr. 23,738 (Arnold) .

However, at the time these decisions were being made, W was not told that he  ;

was being reassigned for disciplinary reasons. Tr. 23,775-776 (Arnold) . There is no [

documentation anywhere in Licensee's records to show that the reassignment was disci- l plinary, or that it was connected with W's perfonnance in the training program. 1MIA l Ex. 53,54, 62, 66, 71, 72. 'Ihe only written remrd of W's reassignment characterizes it as tanporary and as notivated by the valuable cmtribution which W could make to t'r Acciz#. Investigation Documentaticn Group. TMIA Ex. 54. SMR 1 236.

W had been Supervisor of Operations for Unit 2, and as such, he had played a key role when that plant went on line. Both Arnold and Miller spoke in glowing terms of W's technical ability and his knowledge of the damaged reactor. Tr. 23, 757 (Arnold) .

Miller stated the W was unique in his technical capabilities and that he (Miller) did rut expect to find another individual as technically ccnpetent as W. Tr. 24,401, 24,423, 24,458 (Miller) . It is not surprising therefore, that Licensee , faced with an unprecedented situation in the aftermath of the accident, chose to utilize W in a position where his s.C11sbnd keen knowledge of the plant would be most useful.

What is surprising, however, is Licensee' belated characterization, without decmenta-tion, of that reassignment as a detetion. In fact, if it were a demotion, it occurred .

without W's knowledge. Although Arnold testified that W was informed of the denotion, j there is absolutely no doc mentation to support such a claim. W, who had no discernable ,

motive to lie, testified that he did not consider the move a demotion, but rather as a l t

lateral transfer. Tr. 26,642 (W) . It also appeared that W's fellow employees were  ;

unaware of any denotion. It is apparent that neither W nor his fellow stployees had the impression that W's reassignment was disciplinary, or ccnnected to W's training requirenents. It is thus clear that Arnold's testimany to the ocntrary, is non-credible as Judge M11hollin inplies in SMR 1237.

Arnold also states thatjat the time of the W/0 incident, he never reviewed the file of W. Tr. 23,707-8. This is sinply not plausible. Arnold would have us believe th t.'c rejectee the revrmmndations of the Station Superintendent and Vice President of Met-Zd , and chose a sanction so severe that the consequences of this sanction could have , as the Board points out, an adverse and lasting effect on W's career. T 2284.

That the President of Met-Ed would take such an action against an enployee with 9-10 years service , Tr. 23,751 (Arnold), without first reviewing in detail all of the information surrounding the precipitating incident, and in oppositicn to senior officials of the plant,is incredible.  :

' Further, that this should have been done without infonning W of the reasons for l taking such action belies Arnold's own definition of the purpose of discipline, and j l

sinply makes no sense. Contrary to the Board's assertion in 12286, informing W that his reassignment was disciplinary in nature would not have humiliated him, it would have informed him that cheating was unacceptall3e, and would not be tolerated by management.

It is clear that Mr. Arnold was not being truthful when he testified to his l

ignorance of the facts surrounding the 1979 incident, and W's recertification. The Board erred in not etncluding that Mr. Arnold rendered untruthful testinony, and in

! not finding him incanpetent ta manage 'IMI-1.

2. 'the record is replete with other exanples of non-credible testinony evidencina extrane disrespect for the NBC process by canpany enployees.

l l

l-Exceptions 7, 38, 102 The Board's findings with regard to Gary Miller's false certification to the N T includes an evaluaticn of his testinony which both the Board and Judge Milhollin found unbelieveable. 11 2303-2307. His testimony regarding O's knowledge also was not credible. SMR 1 227. As already discussed, the testimony of Michael Ibss, 'IMI-l Manager of Operations, Mr. Husted, training instructor, and other operators P, U, GG, is not credible. (No analysis of bM's crMihility can be done since he did not appear at the hearing and was not subject to cross-examination ) .

Additionally, G and H are found by both the Special Master and the Board to be highly non-credible witnesses. SMR 1 26-77. , 1 2096-2114. Judge Milhollin casts doubt upon the crMihility of A and I's testinony. A and I sat innediately behind O and W when 0 and W blatantly copied frcm each other on the April NFC exam. Yet ,

both claim they saw no cheating. SMR 24. Also, Mr. Shipnan's insistenct that 's does not  !

renember who asked him the questicn during the April 1981 NFC exam, is not credible. See, SMR 11 97-100. Mr. Brown of the training department gave testunony which was found by both the Board /and the Special Master to be convoluted and incredible. 1 2338, 2 SMR V 39. All of these individuals are still canpany erployees, and most are in j supervisory or managerial positions.

Finally, there is Licensee witness John Wilson, who conducted the canpany's investigation into the cheating episodes. It was Mr. Wilson's investigation which Licensee chose to present at the hearings to represent their current response to cheating. It reveals the very essence of Licensee's attitude toward the cheating incidents and the NBC licensing hearings. Judge Milhollin's scathing attack on Wilson, his investigaticn, and his credibility is fully supported by the record. SMR 1334.

Wilson, presented as an independ nt, impartial investigator, was found to be merely an advocate for the Licensee's interests. Even the Board found that Wilson

" worked harder indeveloping exculpatory information than he did in developing ,

evidence of cheating." 1 2252. As Jx3ge Milhollin's detailed analysin correctly illustrates, Wilson's testinony was frotrJ h t with untruths, he unhesitatingly lied in order to advance

I

. he b$mpany's interest. 'Ib this day, the capany supporus Mr. Wilson and his testimony.

The Board, clearly, should have considered the current level of Licensee's integrity in light of Mr. Wilson's report, his testimony at the hearings, the nunber of perscmnel and the nunber of operators who chose to give untruthful testimony at the hearing, or untruthful reports to the NIC. Apart frm the cheating episodes themselves, the evidence clearly demands an even broader conclusion than Judge Milhollin's. The overall level of integrity of the operating staff and Licensee management is inadequate. l l

D. In the hrd's rumm=nded sanctions against Licensee personnel involved in wrcngdoing, the Wrd errs in failing to attach sianificance to evidence on integritv and atti+'* problems of Licensee pe1.suuiel. ,

Exceptions 42, 59, 67, 112, 115, 117, 118, 119, 148, 149, 150 As both Arnold and Henry Hukill, Vice Pesident, 'INI-1, have stated in testimony, operator integrity is essential to the safe operation of the plant. Tr. 23,611, 12, 16 (Arnold), Tr. 24,082 (Hukill) . 'Ihe same is true of course regarding the integrity of management. Integrity of an individual operator or manager is a primary elsnent i in the canposition of an individual's overall conpetence to safely operate a nuclear power plant. Technical cmpetence means nothing if the individual does not have the necessary level of integrity to make safety-related judgenents with the public health and safety in mind.

t It is apparent that to this Licensing Board, an individual may cheat, lie, cover-  ;

up, and blatantly disrespect the NIC process, and still nuintain an appropriate level of integrity to either manage or operate a nuclear power plant. The PID is replete I with exanples.

The Board prefaces its decision by saying, "sme of the inferences and conclusions depend uptn judgement and ethical orientationbnd expectations of the fact finder."

9 2037 (emphasis added) . Upon rs=ading the decisions, it becmes clear just what the Board's " ethical orientation and expectations" are. As has already been discussed in S III, B 5, supra., the Board is perfectly willing to excuse lying about and covering up cne's cheating activities. The Board fails to attach any significance whatever to i

Judge Milhollin's many findings of non-credibility, and his overall conclusion about

the poor quality of the testimony. SMR 1 8. The Board is only to ocmclude in 12045 ,

that no safety consequences resulted frcm the cheating episodes because it either  ;

i believes cheating and disrespect for process and procedure does not create a ,i lack of integrity, or a lack of integrity does not inpact on safety. Obviously, neither version is credible. The results of the October 1981 NRC esam do nothing to .l adddress, let alone moot'the ethical questions raised by these episodes. 1 2341. they l certainly do nothing toaddress the problens of upper managenent. When cne considers the percentage of Licensee witnesses whcm the evidence supports were either involved in wror.gdoing, or gave non-credible testimony, most of whcm are insupervisory or managenent positions, ccmpared to the percentage that the Board chooses to sanction (See chart, S III A) it is clear that proper ethics have little or no relevance tu this Board's definiticm of competence. This illustrates a major failure of the Board's decision, and places the ethical judgenent of the Board itssif in question.

This Board has given a clear signal to the Licensee, to all nuclear facilities, and to the public, that it will tolerate lies, half-truths, and cheating, and only when forced by incontrovertable evidence, will inpose sanctions which are little more ~than a slap on the wrist.

In hirling whether to sanction an individual for wrongdoing, the Board's approach is to separate ethical consideraticms fran "canpetence." Aslongasanindivihm1 appears technically skilled, the Board excuses him,despite integrity and attitude defi- f ciencies, for any wrongdoing. For example, the Board siq>rn.Ls the Licensee's approach to dealing with W after his inmlvenent in the 1979 cheating incident, par +i<'ilarly that his actions ware not advertised at the plirt. The Board states that such actions

"would have humiliated W," and have bem " des:ructive to W's effectiveness." 12286, since his skills were sorely needed at 'IMI.12286. (It should be noted that the Board also apparently believes that infornung W himself of his own denotion would have had the same effect. 1 2286. This assertion makes no logical sense and is unsupported) .

The Board's separaticn of integrity and canpetece was also a major thane in the first PID. In their earlier decision, the Board failed to reatmnend any sanction against l

Miller and Herbein for their involvenent in stifling information flow during the 'IMI-2 accident. In fact, the Board glowingly approves Licensee's decision to prmote Mr. Herbein to GPU Vice President for Nuclear Assurance, stating "the Board has no informaticn bringing into question Herbein's ccmpetence and as 'IMIA urges us to do we find that he has the background and technical expertise." 1 142 (enphasis added) .

Regarding Mr. Miller, whose ethical judgenent during the accident was questioned by even the NBC's investigation into the acciden* ,(See, discussion, S II, C 3) ,  !

the Board fully supported Licensee's decisicn to piam him as head of start-up and test at Unit 1. With the revelation of his involvenent in the material false statemnt incident, the Board finally has decided his " ethical judgenent" may be ,

i deficient. But even so, the Board refuses to reccmmend even his suspension frm this  !-

highly critical position, reasoning, "in the interest o_f safety, we would not deprive Licensee of available talent." 1 2319 (apphasis aMul) .

Similarly, the Board finds Mr. Husted cmpetent to renain as a training instructor, despite its doubt whether he is able, or willing, to impart a sense of seriousness and responsibility to the 'IMI-l operators. 5 2167. Mr. Husted, it seens, is also

" technically cmpetent." 1 2168. Given Hasted's history of soliciting an am. on I

an NBC exam, failing to cooperate with the NBC investigation, and giving false testimony at the hearing, the Board has grossly abused its discretion by not ordering Husted imnediately removed frm the training staff, and licensed duties. ,

l Regarding Arnold's involvement in the W/O incident, the Board fails to even f l

address the problems raised by the evidence and Jtxige M11hollin regarding Arnold's non -credible testimony on this topic. Thus, the Board has ccnvenientlyavoided the issue of appropriate sanction. Nor has the Board attached any significance to untruth-ful testunony rendered by any other witness in these prceeedings to warrant sanction.

In fact, it finds a public interest in not sanctioning Mr. Shipnan for his untruthful testimony. 1 2144. The Board, for example, admits to doubts regarding Mr. Shipnan's honesty, 1 2047, 2144, 2145, but nonetheless exonerates him, ignoring the fact that he continues to shield a cheater. The Board reasons that he should not be punished,

since he " volunteered" the informaticm, and there is a "public interest in bringing about such disclosures." As already discussed, this type of reascning is without any basis. (See, S III, B, 5) But in addition, his voluntaryreport came only after an investigation was already in progress, months after the incident occurred. Mr.

Shipnan's continued cover-up raises serious question about his ethicalfjudgement and he should not be permitted to hold an operating license. The Board's " sanctions," j a letter of reprimand and the Board's own stated suqxi.cion about his candor, are woefully insufficient in light of the nature of Mt. Shipnar.'e offense , and his position of management and responsibility at 'IMI.

Exceptions 26, 27, 28, 29, 35 Similarly, the Board's reccmnended sanction against G and H, and failure to sanction GG at all, are wholly inadequate and represent an abuse of discretion.

The Board , though forced to the inescapable ccmclusion that G and H cheated, nanages to find scrne " mitigating factors" surrounting these episodes of cheating which in the Board's opinion, lessen the inpact of the cheating. 1 2118. No consider-ation whatsoever is given to the fact that G and H repeatedly gave untruthful testinony at the hearing.

First, the Board considers that the exams on which cheating by G and H occurred were ccrnpany rather than NFC exams. 1 2118. This fact is also an " ameliorating ,

circumstance" used by the Board to inpose no sanction against GG 12135. The Board i is wrcng to attach any significance to this point. Cheating is cheating, no matter who administers the examination. The integrity of the operators is no less questionable because they seized the opportunity to cheat on one type of exam rather than the other. Further, the Board's analysis belies its claim that operators rely on ccrnpany exams to test knowledge,12044, and ignores the fact that G and H, W, GG, and O and W all cheated on :cmpany cxams. Cmpany exams are the only vehicle which tests an operator's knowleoga of ongoing changes in the plant and this knowledge is vital to the safe operation of the plant. The Board's distinction is wtolly arbitrary.

- = - _

l-Second, the Board asserts that the proportion of answers produced by cheating is relatively small. 'Ihis mismnstrues the eddence. The cheating by G and H was extensive. It persisted over several nonths. On specific exams the point value attributed to those questions on which they cheated, anounted to greater than 50% of the total score of one exam and almost 50 % of another. And this only covers I; the word for word copying which is the only type of cheating the Board recognizes in this decision. {

Third, the Board does not believe that the overall results d monstrate a poor understanding of the courscynterial. Not only is this irrelevant, but is contradicted by the record. That the Board could have reached this conclusicn after reading the  !

testimony of G and H and their various exams which are part of the record, is remark- i able. See, SMR 1 26-77 By their own testinony they were exposed repeatedly to sme of J the information on which they were examined. In other instances they were unable to explain underlying concepts which they claimed to have learned by rote m morization.

This last condition was by no means discrete to G and H, SMR 1247, and was in part the infrmation upon which the Special Master relied in his finding that the training program is inadequate. See, SMR 1 26-77, 242-247. .

Fourth, the Board excuses G and H since they have now passed their NPC exams under {

properly monitored conditions. 'Ihis is also irrelevant and totally misses the point.

No one would expct they would engage in word for word copying again. But the basic questions about their ethical conduct have not disappeared. In addition, there was considerable testinony that examinees are still force fed information and encouraged to mmorize. Tr. 25,083, (00) , Tr. 25,905 (H) . And when questioned concerning the underlying concepts of responses, G and H exhibited a r m arkable ignorance. SMR, Id.

Given the past performance of these two, there is no assurance that they even have an understanding of the actual workings of the plant, let alone the necessary level of i.itergrity to make safety related decisions.

Fifth, the Board insists that "we have, then a question of ethics, not of cmpe-

tence." t 2110. As Mr. Arnold pointed out, "his management must and does inherently rely on the honesty of others, and that he has assuned a basic honesty in his opcra-tors. 1 2065. Thus, the position of an operator is one of trust. We Board would have us believe that G and H, who cheated repeatedly and perjured themselves at the hearing, are worthy of that trust. 'Ihe sanction proposed by the Board does nothing  !:

to restore faith that these two operatorswill act with integrity in the future. Se L

Licensee and G and H have quickly moved to accept this sanction. This Appeal Board must re_umeud that the operating licenses of G and H be reoved tMbtely. '

Similarly, although GG was not caught engaging in the same widespread and repeated cheating as were G and H, and questions of his technical abilities were not raised, he did cheat and untruthfully denied doing so. SMR 1 93. Clearly s e e sanction is warranted. Again, the Board makes sme sort of distinction between " ethics" and "cmpetence," 1 2135. See, also, 1 2119. Moreover, the Board then determincs that it "will not find him ethically disqualified for lack of candor." 1 2136. The Board's I t

failure to impose any sancticm m GG, even a lesser sanction than license reaval as rectmnended by Judge Milhollin, SMR 1313, is an abuse of the Board's discretion. l-In sun, what this Board does not see to recognize is that it can not have people running a nuclear power plant who are willing to lie to the NIC. One of the nost blatant excmples of the Board's attitude cxmcerns Miller, Herbein, and Arnold's involvment in falsifying W's certificaticm to the NIC in 1979.

Exceptions 14, 15, 68, 120, 122, 123 The details of this incident are well explained by the Board in 11 2287-2320.

Miller and Herbein are clearly implicated in the decision to send this letter to the NBC. Arnold's implication is inferred frcm clear evidence on the record. (See earlier discussion regarding W, S III, C) . Further, he is ultimately responsible for covering-up the incident until the letter itself was produced along with accmpanying relevant evidence during the discovery phase of these hearings. (The incident belies the Board's claim that at these hearings, Mr. Ross was the highest nsber of 'IMI-l managment whose ethical conduct was questioned, t 2046, and also that Arnold made a full disclosure on all' matters of possible relevance to the cheating incidents. 5 2050).

. _ = . -. = _ _ . ._. ._ . .- - -- .

'Ihe Board remmended sanction against none of these upper managenent persmnel, recm mending only further investigation. Further investigation of this incident is l utterly pointless. 'Ihe facts could not ae more clear, and the Board has an obligation to follow through on those facts, particularly as they concern those most heavily ,

implicated.

l That Miller and Herbein have now been renoved frmt nuclear-related positions, does ,

not absolve them of guilt. Licensee has never indicated that either transfer was a  !

diciplinary action. Nor do these transfers exonerate Arnold or the corporate entity it-  !

4 self. Also, that Miller and Herbein are no longer in nuclear safey-related positions ignores the fact that the Licensee kept Miller in a highly critical position until ,

October 1,1982, and kept Herbein in a tcp corporate managenent, safety-rQted post i

until after the SMR was issued. Arnold and the corporation are soley resptsible i for this. 'Ihe incident has severely undermined corporate management's integrity.

'Ihe Board has diminished the significance of this incident because, it claims, '

it is not directly relevant to 'IMI-1. (W was 'IMI-2 Supervisor of Operations) . 'Ihe i

Board is apparently unaware that O, involved in the later April 1981 cheating episodes l with W, was a msnber of 'IMI-l's operation staff both at the time of the 1979 W -

incident and the 1981 cheating incident. Further, at the time the exam in question  ;

was ccmpleted and subnitted, the training programs at Units 1 and 2 were shared. 'Ihus ,

the incident has direct relevance to this proceeding.

Clearly, the Board has a responsibility to recmmend severe sanctions against l; Miller, Herbein, Arnold, and the campany for its involvement in this incident. That it has failed to suggest the need for any sanction at all is an unquestionable abuse of discretion.

E. 'Ihe Board's belief that probably almost all, perhaps all, of the cheating of any important relevance to this proceedings has been identified.

Exceptions 2, 4, 6, 8, 89, 90, 91, 92, 137, 138, 139 As the evidence gathered in this recpened proceeding reveals, cheating and wror.gdoing by capany officials cut across all levels of the management and operations staff. Despite the amount of wrongdoing revealed by the evidence in this proceedings, 4

i there is no assurance that all inportant incidents have been discovered, in contra-diction to the Board's assertion in 1 2041. The Board suppurts its view by asserting that the hearing itself was a fom of investigaticn. 1 2042. However, 'IMIA's experience has revealed that there were serious voids in the reopened hearing process.

One of the main probl e s was restrictions on the intervenors' abilities to discover relevant evidence. First, the discovery phase, as did the hearings themselves, proceeded at an extraordinary expedited pace, making it impossible for either the parties or the Special Master to emprehend, assimilate, and make appropriate ccnnections between all docments gathered and testimony presented. This became nore a[ parent as time went by.

Secondly, the issues were restricted soley to post-accident events. As testimmy revealed, cheating runors have dated back to pre-accident times. Staff Ex. 28, Enc. 1-2,3.

'Ihirdly, the parties were forced to rely necessarily on the Staff and Licensee investi-gations, sme not even produced until the discovery phase and the hearings thmselves were in progress, to pursue leads during discovery and during the hearings, as well as for direct evidence. As Judge Milhollin has shown in great detail, both the Staff and Licensee investigations had major deficiencies. See, discussicn in SMR 11 185-219, 288-302.

I and E, in particular, produced the reports on which many of the issues developed at the hearings were based. During I and E's first investigation examining the April 1981 O and W cheating episode, it was unsuccessful in rmoving managment frm the interview. Although the Board and the Staff concluded that management's .4 presence was inhibiting, but that the overall effectiveness of the investigation of O and W was not affected, this is mere speculation and likely incorrect. As Judge Milhollin correctly points out, the presence of management prevented the investigation frm recieving evidence of managment involvement on a confidential basis, and , "the effect of managment's presence at the first investigation was probably not cured by excluding managment frm the subsequesnt investigaticns; a person who had withheld or falsified information at the first investigation would have been unlikely to admit

I

(

1ater that he had done so." SMR 1 291. ,

Further, the fact that O and W did not admit their guilt until their 3d interview, which was conducted without managment present, supports the contention that managment was inhibiting. See, Staff Ex. 27. W stated that he respects Mr. Hukill, who sat in cn the interviews, and did not want to adnit his guilt in front of him. Tr.26,164 (W) .

However, the nest telling point here is that it is highly unlikely that any of the other 11 interviewees, though honest, would have responded with specific details of operators' or managments' involvment in cheating, to the extrmely broad and unfocused questions asked by the IE investigators regarding their general knowledge of cheating at that time, with managment looking over their shoulder. l Indeed, no specific evidence was obtained frankhese eleven interviewees regarding l actual cheating incidents. (Among those interviewed were 00 and U.)

In addition to these and other deficiencies discussed by Judge Milhollin, SMR1 288-302, it should also be cuphasized that the Staff could have used such forensic tEhniques as the polygraph and handwriting analysis, but chose not to use them.

Given all these probims with the Staff's investigation, and the already recognized deficient quality of testimony at the hearing, it is inpossibe to know that all or most important instances of cheating have been revealed. It is equally likely j that a number of instances rm ain uninvestigated.

F. 5he nmrd's response to the cheating episodes and Licensee's training and testing deficimies , consist of inposition of a OA/OC pmicuu, which includes independent audits throughcut a probarinnary two year period of Licensee's training and testing program, ordering the establislirent of training instructor qualificatiortriteria, an intarnal auditina procedure, and a procedure for reviewing NFC exam answers to detect for cheating, do nothing to cotiu,t the substantial probles in Licensee's training and testing prugram revealed by these proceedings.

The training program had been an issue in the main proceedings because its defi-ciencies had been blamed as contributing to the accident's escalation. The Ccumission had issued specific orders requiring the upgrading of the training program at 'IMI.

The Board had concluded in the first PID that the training program satisfied the Comnission's requirments, basing the finding on expert testimony, but "necessarily relying on the NFC operator exams as a final, independent, and accurate measure of

o .

operator ccxnpetence." 5 2321. fne record which developed in the reopend proceeding concerning the failures of Licensee's training and testing program, as w l1 as the cheating episodes themselves, diectly . challenges the conclusions reached in the first PID supporting the adequacy of Licensee's training and testing program.

Exceptions 124, 125, 126, 130, 132, 133, 134, 135, 154, In the July 27, 1982 PID, the Board has reaffinned its intention to rely on the NFC exam as a final measure of operator canpetence. 1 2321. 'Ihis reliance is mis- l placed as the evidence in the reopened proceeding has revealed. Specifically, in reaching this ccmclusion, the Board has chosen to ignore the questicns raised at the reopend hearings concerning operator integrity and judgenent, which are not addressed by the NBC exam process. In fact, the Staff witnesses testified that despite operator integrity problems revealed by these proceedings, they will continue theri practice of relying cm Licensee to certify the integrity of their operating staff.

t is clear that the integrity and ethical judgenent of Licensee managenent itself has been proven inadequate by issues raised in these hearings, suchas: managenent's decision to subnit a material false statenent to the NBC, covering up the evidence of cheating by two operators, one of whczn was a manber of management himself, and the readiness by members of managenent to give false and misleading evidenca concerning this incident; relying cm superficial investigations and supporting misleading reports ,

l and testimony to exonerate atployees suspected of cheating; and , in the face of overwhelming evidence, continuing to deny that anyone other than 0 and W are guilty  !

of wrongdoing.

As the evidence clearly denonstrates, Licensee is totally unfit and incapable of accurately assessing the integrity of their operators. Therefore, the NRC's reliance on the Licensee as certifier of operators integrity, and in turn the Board's reliance on the NRC process is misplaced. In addition, reliance on the NBC exam can not reveal certain deficiencies in Licensee' trainig and testing program which ultim-mately must prepare operators to operate the plant.

First, the Board recognizes that Licensee failed to extend QC to procedures F me- - - -- ,--

which would insure cmpany exam integrity. However, the Licensee and the Board attribute Licensee's failure to develop procedures which would prevent cheating to naivete

. and believes that since Licensee is now aware of failures of exma integrity, instituting new procedures will correct the problem. The Board fails to note that at the time I

that the Licensee was developing its revised procedures, Licensee management was j' already aware of the 1979 cheating incidents, and Miller evaluation of training ..

4 as it related to W's cheating. 'IMIA Ex. 71. 'Ibe training department recieved  ;;

m ch critician by the various investigations into the accident, and was subjec+: of the Camission's August 9 Order. Training deficienceis were discussed in detail i ,

during the earlier part of the hearings. To continue to claim naivete in the face of all this infonnation, is not credible. It is clear that despite new procedures, Licensee

} is not empetent to make the necessary adjustments to assure the integrity of its I. :

a I

training program. 'Ihe nnard's contrary findings are arbitrary and capricious.

The Board also inplies that the failures of the training program are attributa-ble to " weaknesses" in instruction, fran instructors, and aducnishes the Licensee for its failure to extend QA/QC to training "at the point of delivery." First, the Board fails to acknowledge evidenc on the record which plainly shows failures  ;

of instruction, not mere weaknesses. SMR 1 242-247. Secondly, the Board is incorrect [

l f to blame instructors for these "weaknesms" and to now excues Licensee for not imprwing OA in this area on its own. During the main proceedings, Dr. Knief testified "it is the responsibility to the Manager of Training to ensure that 'IMI-l personnel 1

! geceive sound instruction in programs to which Licensee is emmitted," and,"'Ihe Manager of Training is also responsible for ensuring that 'IMI instrutors are qualifiad to teach the subjects to which they are assigned and that they enploy sound Maching I

i 1

methnds ... the effectiveness of teaching methods and the quality of the course I

materials is mtnitored by the Manager of training... Finally, the Manager of Traimng nust inplement those corporate policies, as well as policies established by the Director of Training and Education applicable to the training program.: Tr. 12,140, at 10-11 (Knief) . The Board has sutmarized the statement of Herbein, in the first PID, ,

l

j i

"Mr. Herbeln, Vice President for Nuclear Assurance, characterized the role of the Nuclear Assurance Division as a key or.e, particularly in light of the lessons learned frun ,

the 'IMI-2 accident, such as the inportance of training, quality assurance, and nuclear ,

safety assessment," 1 110. to now assert that the instructors are responsible for j i

the failures of the training program and that the Licensee was unaware until the j Reopened Hearings of the importance of QA with regard to training instruction, is not reasonable and is contrary to the evidence.

The Board's inpositicn of "conditicns" to insure the effectiveness of OA/QC in the training department, is a faulty rmedy. First, Conditicn #1, which allows a two year prcbationary period during which time the training program will be auditied, violates the Ccmnission's AtxJust 9 Order. 'Ihe Camtission was clear that any condition necessary to insure the safe operation of the plant be imposed before restart.

Secmd, by inposeing conditicn #2, requiring training instructor qualification criteria, ignores the fact that Licensee has already cannitted itself to do this-and it has blacantly failed to do so, as evidenced clearly by scme of its current instructors. See, discussion, III, B, 2; C,2 Iong,Knief, ff. Tr.12,140 at 54.

With regard to conditions 3 and 4, Licensee has historically shown itself incapa-ble of recognizing the most blatant cheating and other wrongdoing. To this day, Licensee fails to admit that G, H, and W cheated, that Miller made a material false statanent to the NFC with Herbein's concurrence. To asstxne that they will I i

t now suddenly develop the objectivity to effectively police thanselves, ignores their

• history of failure in that regard, particularly their refusal to cmply with Ccmnission Orders or its own procedures unless under intense scrutiny, their failure to take ,

independent action to correct. deficiencies unless under intense scrutiny, or their refusal to recognize deficiencies even when under direct scrutiny.

For example, in February 1981, Dr. Icng appeared before the Board and gave testinony concerning Licensee' training and testing program. He was asked specifically about the Licnesee's policy of administering exams in an open book format. The Ccmnissicn had informed Licensee late in 1980, that the open book format was unaccep-

, -e> ._

- o .>-

e table and the Bor 1 wasted to know what Licensee's response to this item. Iong testified that the language in the new administrative procedures had Lw n changed impluing that exams would no longer be administered 'open book.' However, it became obvious during the reopened hearing the Licensee continued to administer take h m e open boo & exams until the NBC began its investigation of cheating. The Board i

i takes Licensee to task for not following its own procedures. V 2323 , and imposes a condition on restart, whereby the Licensee's training program will be audited by independent auditors for a period of two years after start up. mis episode provides support for the conclusion that Licensee is incapable of following its own porcedures and will do so only under intense scrutiny.

Were are many other exmples of Licensee's disregard for its own procedures and inability to police itself. For exmple, A.P.1006 states that when quizzes are con-structed "a variety of questim types may be used, but questions requiring analysis or detailed discussim should predminate." Lic. Dc. 62 at 14. As Judge Milhollin points out in his analysis of G and H's weekly quizzes, Licensee chose to ignore the procedure.

The examples of Licmsee's failures of ompliance are not limited to the training department, however, On May 22, 1982, two utility workers at 'IMI-l were exposed to l

high levels of radiatim while performing a preventive maintenance task in the aun. liary l

biilding. An NBC investigaticn into this incident revealed that the cause of the i j

accident was a failure to follow Preventive Maintenance Procedure U-17. (See NBC STAFF  !

l CONSOLIDATED REPLY 'IO TMIA'S 10rION EOR EXTENSICN OF TIME IND NAIVER OF P7tE LIMI FND 10rIOi 'IO SUSPEND BRIEFING, attachment at 8-9.) This same documt-nt contains evidence that Licensee is not capable cf policing itself even when problen areas are identified, l

again, unless exposed to scrutiny. Prior to the accident, maintenance for both 'IMI Units was united into a single department. the Cmmission ordered separation of the departnents. These hearings revealed many problens with the old maintenance system l

which Licensee freely adnitted. See, discussion, e.g. SII B 4 . Licensee presented testimony on its upgraded maintenance procedures at Unit 1.

l

GPU Nuclear Corporation, the managment entity which has been examined in these hearings, was fully aware of Unit l's maintenance probles. The ca pany upgraded the 'IMI-1 procedurcs because of these hearings and the Ocmnissicn's August 9 Order.

Obviously, the same probles existed at 'IMI-2. Yet,' Licensee has not rmedied them.

As the Board has correctly pointed out, "if the Licensee does not itself exercise the requisite quality control, quality assurance, and feed-back mechanisms to assure high-quality training and testing, it is beyond the power of regulators and regulations 1 i

i-to put on appropriate program in place." 1 2327. Licensee sems to be consistently unable to recognize its deficiencies on its own, se to correct recognized deficiencies on its own- the very essence of quality control.

Exceptions 5, 12, 19, 93, 94, 95, 96, 97, 98, 99, 100, 101, 102, 103, 104, 105, 106, 107, 109, 110154, 156.

Similarly, the overwhelming evidence reveals that Licensee fails to conduct credible or reliable investigations when presented with evidence of clear wrongdoing, or even to recognize certain conduct as wrtngdoing. Judge Milhollin did an extzmely detailed analysis of Licnesee's failures in the conduct of its investigaticns into cheating incidents. 'IMIA fully supports his analysis and conclusions. SMR 11 200-219.

One of the clearest exanples of Licensee's blindness with regard to splayee wrongdoing of course is the incidnet involving W and 0, and Licensee inadequate p response. Part of that incident rmains uninvestigated- that concerning whether O knew he was helping W cheat. Judge Milhollin correctly found that O knew that the t

answers he was coupleting for W were part of an exam requirement, and that Miller knew of O's knowledge. Miller denies this. ,

The evidence clearly sustains Judge Milhollin's conclusions, particularly if one considers his rmark at the hearing that the handwriting on the cover sheets to the docunent which O had assisted him on, was very similar to the handwriting ccntained within the exam whidh was not W's. But because W's confidentiality was protected throughout the hearing, only Judge Milhollin had a cover sheet with W's actual name on it. Thus, 'IMIA could not determine this crucial issue for itself.

Ik: wever, at the time 'IMIA was preparing its proposed findings, we contacted Chairman Smith telephonically, requesting that we be allowed to examine the 1

originals of the exam. 01 airman Smith responded by saying that he would examine them and if he felt the matter significant, he would contact 'IMIA. We never heard fran him., and because of the pressure to produce findings on time, 'IMIA was unable to pursue the matter. 'Ihus, a significant issue rmains uninvestigated. O, of course, later cheated on the April NBC exam.

O's culpability is apparent fran other evidence, also. W testified that he was pressed for time. Tr. 26,678. 'Ihe evidence supports a conclusion that O cmpleted the exam for W, signed his name to it, and turned it in, and not the inference that W could have merely been asking O to answer sczne "questiansafor him.

It makes no logical sense that an individual with W's reputed technical cxxnpetence, would ccrne to the plant, pressed for time, request O to answer scme questions , wait for o to finish, attach the cover sheet and subnit the exam to the training department. Also, the exam does contain errors. It would seen that if W had waited for O to ecmplete the answers, he would have certainly reviewed them for accuracy.

Section H(k), the secticn whichO ccripleted alore, received a score of only 64%. W testified " ... the type of question that he answered for me, he would not have had to look up any answers. It was ccmnon knowledge." Tr. 26,679 (W) .

l The evidence supports a conclusion that O was always aware that he was assistin g t W canplete the exam. Further, it evidences the failure of Miller and the training 1

L department, who have always accepted O's denial of culpability,t9gnore clear evidence of an individual's culybility in wrongdoing. That O was later caught engaging in widespread cheating on the April,1981 exam is consistent with a lack of integrity which the training department should have recognized in 1979. It still refuses to do so, and pointedly illustrates that this Licensee refuses to recognize obvicus cheating and wrongdoing. It certainly can not be depended on to prevent future cheating episodes, despite new procedures. The Board's reliance on such new procedures is cxmpletely arbitrary.

IV. CCtCLUSICN Excepticms 11, 21, 126, 152, 158, 149, 159 The Board has shown that it is willing to ignore obvious evidence of cheating and to excuse Licesee for its wrongful cmduct, because of a predetermined decisicm to support the restart of this reactor. . It has a substantial interest in mair.taining the credibility of its findings and conclusions in the PID of August 27, 1981. But, the evidence revealed in these reopened proceedings empel the ccmclusion that this empany is not ompetent to operate a nuclear power plant, and  ;

that a nunber of the findings in the first PID must be overturned. See, ' INIA Cmments, supra.

The public health and safety should be the only consideration in determining restart - not, as the Board indicates, the happiness of the operators. Neither the Licensee, nor its operatorc, have a right to an operating license. It is a privlege.

'Ihis Licensee has abused its 1.nvlege and has not rh itself.

For all of the above stated reasons, restart of 'IMI-Unit 1 must not be authorized.

[,

f Respectfully subnitted, I

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'IHREE MILE ISLAND ALERT, INC.  ;

% *te , r*A By A xd > ' -

Iouise Bradford I.

.Nenue./L %/ c w Jpanne Doroshow Three Mile Island Alert, Inc.

315 Peffer St.

Harrisburg, PA 17102 Dated: Septanber 30, 1982 Intervenors

w

• UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION B'EFORE THE ATOMIC S AFETY AND LICENSING APPEAL BOARD In the Matter of )

) Docket No. 50-289 METROPOLITAN EDISON COMPANY ) (Restart)

)

(Three Mile Island Nuclear )

Station, Unit 1) )

TMIA'S EXCEPTIONS TO PARTIAL INITIAL DECISION (REOPENED PROCEEDING)

1. The Board errs in its legal conclusions concerning the weight to be afforded the factual and legal conclusions reached by the Special Master in his Report. 11 2035, 2036, 2037, 2038.

2. Exceptions relevant to 11 2039 and 2040 are ana-lyzed, infra.

3. The Board's conclusion in Y 2041 that it is prob-able that almost all, perhaps all, of the cheating of any important relevance to this proceeding has been identified, is without factual support, is arbitrary and capricious, and is contrary to the evidence.

4. The Board's assertion that the hearing was a form of investigation, is contrary to the evidence.

5. The Board's conclusion that the Licensee sincerely tried to uncover and report every instance of cheating, is irrelevant, and is contrary to the evidence. 1 2042.

. ,'l h, C R C

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6. The Board's conclusion that every suspicious paral-

• lelism has been identified, is unsupported by the record, and is contrary to the evidence. 1 2042.

7. The Board's conclusion that the testimony of the  ;

operators was thorough, and that they have performed well, is arbitrary and capricious, is unsupported by the record, and is contrary to the evidence. 1 2043. ,

- 8. The Board errs is relying on the fact that 30-40 operators apparently did not cheat, as this is irrelevant. [

1 2043.

9. The Board errs in 1 2043 in not adopting the Special Master's finding that the "... overall integrity of the operations staf f has been found to be inadequate. "  !

i

10. The Board's conclusion in 1 2044 that rational i candidates would use the qualification exams as a prelim- ,

inary test of their ability to pass the NRC operators I

licensing examinations, is irrelevant, is arbitrary and capricious, and is totally without support. l

11. The Board's conclusion that no safety consequences resulted from the cheating episodes, is arbitrary and capricious, is unsupported by the record, and is contrary to the evidence. 1 2046

12. The Board's reliance on Licensee's reconfirmation of its commitment to abide by License Condition 9, is arbitrary and capricious. 1 2045.

13. Exceptions relevant to 11 2046-2049 are more thoroughly analyzed, infra. '

f

,-w., -yy. -,-, y ,- - - -

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14. Tha Board errs in relying on Mr. Arnold's dis-closure of the VV incident to support a finding that Licen-see has tried to make a full disclosure on all matters of possible relevance to the cheating incidents.1 2050.

15. The Board's conclusion in 1 2051 is arbitrary and capricious, is contrary to the evidence, and is unsupported by the record. .

16. Exceptions relevant to if 2052-2060, are more thoroughly analyzed, infra.

17. The Board's conclusion that the Licensee cooper-ated fully in the reopened proceeding, is contrary to the evidence. 1 2060.

18. The Board errs in concluding that the evidence has not brought the adequacy of the course content 1. to ques tion . 1 2061.

19. The Board's failure to find bad faith or inherent incompetence in upper-level TMI-l management from the cheat-ing episodes, based on the evidence recited in 11 2063-2066, is arbitrary and capricious, and is unsupported by the record.

20. Exceptions relevant to 11 2067-2086, and 2089, are more thoroughly analyzed, infra,

21. The Board errs in concluding that it is unneces-f sary to bring every miscreant to justice, to resolve every l

uncertainty, and to produce a more reliable record. 1 2087.

22. The Board errs in 1 2088 in concluding that fur-ther proceedings would be disruptive based upon concern for l

. . the operators, as opposed to concern for the health and safe-ty of the public.

23. The Board errs in not endorsing Judge Milhollin's recommendation that O and W should be referred for criminal prosecution. 1 2093.

24. The Board errs in not referring the case against O and W to the Deparment of Justice. 1 2095. ,

- 25. The Board arbitrarily fails to discuss Judge 8 j

Milhollin's evaluations of witness demeanor in its conclu-sions regarding witness credibility. 1 2114.

26. The Board errs in not endorsing Judge Milhollin's recommendation that Licensee be prohibited from using G and H to operate TMI-1. 1 2116.

27. The Board's conclusion in 1 2119 that the overall results do not demonstrate a poor understanding of the course material is contrary to the record.

28. The Board improperly relies on the fact that G and H have passed their NRC exams to support a finding of their competence at operators. 1 2119.

29. The Board's conclusion that its remedy is respon-l sive to the G and H cheating episodes is arbitrary and capri- 1 cious. 11 2120, 2121.

30. The Board's conclusion that MM did not cheat on i

the December 1980 quiz is arbitrary and capricious and not supported by the record. 11 2132, 2137.

31. The Board's inference in 1 2134 that W copied from GG is not supported by the record.

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32. The Board's conclusion that it is very understand-able why GG would not prevent W from copying, is arbitrary and capricious, and totally unsupported. 12134.

33. The Board's conclusion that GG's lack of candor does not make him ethically disqualified is arbitrary and ca- cious. 1 2136.

34. The Board's reliance on MM's statements outside ,

the record violates due process and is severely prejudicial.  ;

1 2132, footnote 232.

35. The Board errs in imposing no sanction on MM or GG. 1 2138.

36. The Board's finding that Mr. Shipman voluntarily reported the incident is contrary to the evidence. 1 2139.

37. The Board's finding that Mr. Shipman convinced Mr.

Hukill and Mr. Arnold is contrary to the evidence. 1 2141.

38. The Board's conclusion in 1 2142 that Mr. Ship-man's statement is not incredible is arbitrary and capri-cious and unsupported by the record.

39. The Board errs in rejecting Judge Milhollin's rea-soning regarding Mr. Shipman's testimony concerning his mem-ory of the events. 1 2143.

40. The Board's statement that there is a public inter-est in encouraging such disclosures, in 1 2144, is irrele-vant, without support, and in any event, inapplicable in this case.

41. The Board's conclusion in 1 2145 that Mr. Shipman will never name the unidentified questioner or will never give a credible reason why he cannot name him, is an unrea-h

• sonable inference, is arbitrary and capricious, and is unsup- ,

ported. t

42. The Board errs in not recommending Mr. Shipman's removal or suspension. 11 2144, 2145, 2147.

43. The Board's failure to find evidence to support Judge Milhollin's conclusion that Mr. Husted solicited the answer and that P denied it untruthfully, is arbitrary and ,

j capricious. 1 2149.

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44. The Board's legal conclusion regarding the weight  !~

to be af forded Judge Milhollin's witness demeanor evalua-tions is contrary to law. 1 2150.

45. The Board falls to attribute proper weight to b

Judge Milhollin's observation of witness demeanor. 1 2150.

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46. The Board errs in 1 2151 in drawing nc inferences F if unf avorable to P or Mr. Husted because P was angered by the l-i lack of NRC proctoring during the exam.

48. The Board's conclusion that the meaning of P's .

remarks was disputed is contrary to the evidence. 1 2151. l

49. The Board's failure to assign evidentiary weight to Mr. Baci's silence is arbitrary and capricious. 1 2153.

50. The Board's conclusion that there is no indepen-

! dent corroboration of Mr. Ward's testimony is contrary to f

the evidence. 1 2154.

51. The Board's finding in 1 2156 that Mr. Ward's

' accusations are not sufficiently supported by reliable evi-dence, is contrary to the evidence.

52. The Board errs in concluding that Mr. Ward's testi-many lacks any probative value whatever. 1 2157.

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53. The Board errs in 1 2158 in failing to assess the credibility of either P or Mr. Husted.

54. The Board errs in not adopting Judge Milhollin's

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conclusion that P untruthfully denied observing cooperation i

on the weekly quizzes. 1 2160.

55. The Board's conclusion in 1 2161 that P is not untruthful is arbitrary and capricious. ,

56. The Board errs in reaching no conclusion unfavor-able to P. 1 2162.

57. The Board errs in concluding that there is no reli-able evidence that Mr. Husted himself cheated. 1 2166.

58. The Board's finding that Mr. Husted voluntarily came forward with some information is contrary to the evidence. 1 2166.

59. The Board errs in imposing no sanction on Mr.

Husted in 1 2168, as the Board's reasoning is unsupported i

by the record and is arbitrary and capricious.

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60. The Board's decision to give rumor testimony inde-l pendent weight only as it relates to Licensee's response to the rumors, and no weight whatever insofar as it would tend to incriminate U, is arbitrary and capricious and contrary I to law. 1 2173.  ;

l 61. The Board errs in failing to give rumor testimony the independent weight it said it would in 1 2173, in evalu-ation of the evidence.

62. The Board errs in not adopting Judge Milhollin's credibility evaluation of U. 1 2174.

. . 63. The Board's finding in 1 2175 that it was a rare occasion that Mr. Husted's office was available for studying is contradicted by the record.

64. The Board's failure to decide the subissue in 1 2176 is arbitrary and capricious. .

65. The Board errs in failing to adopt Judge Milhol- >

i lin's conclusion that U approached 00 with an offer of help -

j.

during the April NRC exam, as it is directly contradicted by the record. 1 2177.

66. The Board's statement that the principal hard evi-dence against U is his own testimony ignores the evidence, and the Board errs in hesitating to use his testimony in determining his guilt. 1 2184.

67. The Board errs in giving U "the benefit of the doubt" in light of overwhelming evidence to the contrary sup-porting his guilt. 1 2185.

68. The Board's assertion that the allegations against Ross have the most serious implicaton of the entire inquiry on cheating is unsupported. 1 2192.

69. The Board mischaracterizes Judge Milhollin's analy-sis which led him to the conclusion that YY's charges were [

substantiated. 1 2193.

70. The Board errs in concluding that Licensee's motion to reopen the record had merit. 1 2194.

71. The Board's characterization of YY as Ross's sole accuser in 1 2198, and its finding that other than YY's tes-timony there would be no direct evidence against Ross in 1 2199 are contrary to the evidence.

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72. Th3 Board's dicagreement with Judge Milhollin's

- conclusions is arbitrary and capricous and contrary to law.

1 2199.

73. The Board's finding that YY's statement is equivo-cal is contrary to the record. 1 2201.

74. The Board misconstrues YY's testimony. 11 2201, 2203, 2204, 2205. .

- 7 5. The Board's conclusion that YY's testimony and per-ceptions of the meaning of the conversation attributed to Ross is too subjective, internally contradictory, and unreli-able, is arbitrary and capricious. 1 2205.

76. The Board in 1 2206 attributes improper weight to the testimony of GG, KK, and RR, and ignores evidence con-cerning these individuals.

77. The Board's statement that Ross has not been con-fronted with all the specifics of YY's accusations ignores the evidence. 1 2207.

78. The Board's credibility determinations concerning Ross in 1 2208 are arbitrary and capricious and unsupported by the record.

79. The Board errs in 1 2209 in concluding that Ross did not know changes were made.

80. The Board's conclusion that neither Ross 's testi-many on the answer key changes, nor on the proctoring is incredible, is unsupported in the record, and is arbitrary l

and capricious. 1 2209.

81. The Board mischaracterizes Judge Milhollin'a analy-sis in 1 2217.

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. . 82. The Board's conclusion that the chango was not incorrect or improper is contrary to the evidence. 1 2220.

83. The Board's conclusion that the attempt to change j the answer key was not unconscionable, is contrary to the evidence. 5 2222.

84. The Board's conclusion that it is understandable why only lithium hydroxide would come to mind to some is ar ,

bitrary and capricious, and without factual support. 1 2223.  !.

I

85. The Board's conclusion that the changes in the i i

answer key to question B.5.a were made in good faith, is con-trary to the evidence, and is arbitrary and capricious. 1  !

2224.

86. The Board's conclusion that there is no aspect of  !

Mr. Ross' testimony bringing his candor into question, and e that all of the charges made against him are unfounded, is arbitrary and capricious and unsupported by the evidence.

1 2225. l

87. Since the Board dismisses YY's characterization of f

Ross' conduct, it errs in failing to at least analyze the ev-idence and implications regarding the possibility that Ross may have been bragging. 12225.

88. The Board errs in rejecting Judge Milhollin's find-

! ings as to the cheaters at TMI. 1 2227.

j 89. The Board's recitation of the facts in 11 2229 l

and 2230 mischaracterizes the evidence on the record.

90. The Board's conclusion in 1 2231 that this epi-sode has received more attention than it warrants, that it

seers to be a situation where the regulatory scheme worked as intended, and that after the initial confrontation, the participants acted without friction, is arbitrary and capri-cious, and uncupported by the record.

91. The Board's implication in 1 2232 that it was man-agement's duty to be present at NRC interviews with opera-tors is without justification in law or fact. ,

92. The Board's conclusion that the incident is with-out important significance in 12234 is arbitrary and capri-clous and contrary to law.

93. The Board errs in not recognizing the seriousness of Licensee's failure to ask O and W why they cheated. 1 2236. .

94. The Board's finding that the company made clear its attitude that cheating will not be tolerated and that this message was clearly understood, is not supported by evidence in the record. 11 2237, 2240.

95. The Board's statement that it is not clear what if anything was done about OO's report of rumors, is contrary to the evidence. 1 2238.

96. The Board's conclusion that Licensee took appropri-ate actions to meet with its operators, is arbitrary and capricious. 1 2240.

97. The Board errs in not adopting Judge Milhollin's conclusion that "If the Licensee had been trying to find Mr.

Shipman's questioner, such a step would have been strange to omit," and in not concluding that Licensee failed to conduct 4

-ww

1

- - the interviews because it was deliberately not trying to identify cheaters. 1 2242.

98. The Board errs in finding that Mr. Arnold's judg-ment to defer investigation was rational. 1 2245.

99. The Board errs in not adopting Judge Milhollin's conclusion that the Licensee selected for investigation only matters unlikely to implicate management. 1 2246. ,

- 100. The Board errs in concluding that Mr. Wilson's opinions on cheating have little value. 1 2250, 101. The Board's finding that the nature of the ev-idence available in either direction could explain why Mr.

Wilson presented no evidence showing the presence of cheat-ing, is unsupported. 1 2252.

102. The Board's conclusion that Mr. Wilson did not nisrepresent G and H's explanation, is contrary to the evi-dence. 1 2253.

104. The Board's conclusion that Mr. Wilson's investi-gation in 1 2259 was diligent, is contrary to the evidence.

105. The Board's conclusion that the rumors heard by 00 merely fell into the cracks during the company investiga-I tion, is unsupported by the record and is arbitrary and capricious. 1 2261.

106. The Board's finding that the Licensee could not afford to waste time in organizing its investigation, and that turning to Mr. Wilson was understandable, is unsupport-ed by any evidence. 1 2266.

107. Attributing anything other than a failing grade to all aspects of Licensee's investigation, is arbitrary and i

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- > capricious, and is unsupported by the evidance. 19 2267, 2268, 2269, 2270, 2271, 108. The Board errs in stating that the events involved in the VV/O incident do not directly relate to the reasons for reopening the evidentiary hearing. 11 2190, 2272.

109. The Board's conclusion that Mr. Miller did not ,

know that O was deceiving him is arbitrary and capricious, i

and is unsupported by the record. 1 2276.

110. The Board errs in not finding that Mr. Miller knew that O knowingly aided VV to cheat. 1 2276.

111. The Board errs in relying on Mr. Arnold's testi-  !

many that it was widely recognized in the company that VV's f reassignment was an action unfavorable to VV's career. 1 f I

2281.

112. The Board errs in not adopting Judge Milhollin's conclusion that Mr. Arnold's handling of the VV episode was i I

deficient. 1 2283.

113. The Board errs in concluding that there were no other examples of poor performance by VV identified which at the time could have been the immediate cause of his reassign-ment. 1 2283.

114. The Board's conclusion that it is likely that most of VV's peers in middle management saw his reassignment as a demotion, or at least as an impediment to advancement, is arbitrary and capricious, is unsupported by the record, and is contrary to the evidence. 1 2284.

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. . 115. The Board's conclusion that in most success-

' oriented hierarchies, removing a management person from a direct in-line operations position to a.non-supervisory sup-i porting staf f position would be regarded as an adverse  ;

I action, is totally without factual support. 1 2284.

116. The Board's inference that Licensee is a success-oriented hierarchy is contrary to the evidence. 1 2284. ,

- 117. The Board errs in supporting Mr. Arnold's stated  ;

approach concerning actions taken against VV. 1 2285. l l

118. The Board errs in finding that VV's reassignment was an adequate remedy. 1 2286.

119. The Board mischaracterizes TMIA's arguments and the Special Master's report, and its conclusion that a demo-tion would have been destructive is arbitrary and capri-cious, and totally without support. 1 2286.

f 120. The Board's conclusion in 1 2287 that there is a l need to inquire further whether Mr. Miller has made a false material statement in connection with the recertification of f VV, is arbitrary and capricious. {

121. The Board errs in concluding that the episode has only indirect relevance to the Board's jurisdiction. 1 2310.

122. The remedies proposed by the Board in 11 i

! 2311-2319 are inadequate, contrary to law, and violative of "

1 the Commission's August 9, 1979 Order.

123. The Board errs in concluding that there is no evi-dence of any improper conduct at any level higher than Mr.

Herbein's level. 1 2320.

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. . 124. Tho Board's conclusion that the course content is in compliance with 10 CFR S 55, is irrelevant, is arbitrary and capricious, and is unsupported by the record. 1 2334.

125. The Board's conclusion that there was no failure of instruction is arbitrary and capricious, and is unsupport-ed by the record. 11 2337, 2341.

126. The remedies proposed by the Board in 1 2347 are inade quate, contrary to law, and violative of the Commis-sion's August 9, 1979 order.

127. The Board's conclusion that, if properly imple-mented, a formal certification procedure including signed statements, founded on the trainer's evaluation of candi-dates by means of properly administered and graded examina-tion, will enhance the credibility of Licensee's certifica-tion process, is unsupported by the record, and is arbitrary and capricious. 1 2350.

128. The Board's conclusion that when implemented, such steps should eliminate the possibility of certifying candidates for the NRC examination who have cheated in inter-nal examinations on one or more occasions, is arbitrary and capricious, and is unsupported by the record. 1 2351.

129. The Board's statement that they trust that the VV incident was an anomaly and that the present management of TMI-l would not condone the procedure involved in that inci-dent, is totally without support, and is arbitrary and capri-cious. 1 2351.

130. The Board's conclusion that the new grading proce-dure was an improvement over the previous grading procedure l

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. . and that it was adequate for the October 1981 examinations is totally without support and is arbitrary and capricious.

1 2361.

131. The Board mischaracterizes the Special Master's Report in its definition of the issues examined. 1 25{3. I-132. The Board errs in concluding that the Special Mas- i i

ter failed to take into account the oral portion of the exam, in his criticism of the content of the examination. 1 ,

i 2364.

133. The Board errs in concluding that the portion of the Special Master's Report on the substantive quality of the NRC exam has gone well beyond the jurisdiction delegated to him and the Board. 1 2366.

134. The Board errs in not adopting Judge Milhollin's findings that the information sought on NRC exams is so detailed that no operator could have supplied it without memorization. 1 2367.

135. The Board's remedies concerning problems with NRC exams are inadequate, and in violation of the August 9, 1979

, Cemmission Order. 1 2372. ,

136. The Board misconstrues and fails to adequately address the problems identified by TMIA and the Special Master in his report regarding the review proocess. 1 2375.

137. The Board's conclusion that the hearings them-selves constituted completion of the investigation, and any inference that the Staff's response reflects favorably on f

~ Staff attitude, is arbitrary and capricious, and is contrary to the evidence. 1 2393.

138. The Board's statement that the rumors surrounding ,

U were elusive in nature, is contrary to the evidence. 1 2394.

139. The Board's conclusion that the Staff's response was adequate and appropriate, is arbitrary and capricious. ,

1 2394.

140. The Board's conclusion that Mr. Hukill, Mr. John Wilson, and management were merely naive, is irrelevant, is arbitrary and capricious, is unsupported by the record, and is contrary to the evidence. 1 2396.

141. The Board's conclusion that the Licensee's train-ing program was well designed to train qualified operators and that there was a rational plan to implement the program, is arbitrary and capricious, is unsupported by the record, and is contrary to the evidence. 1 2399.

142. The Board's conclusion that the Licensee was un-stinting in the resources devoted to the training program, is arbitrary and capricious, and is without any factual basis in the record. 1 2400.

143. The Board's conclusion that the cheating episodes are not a reflection on upper-level management's competence, good intentions, and efforts is arbitrary and capricious, is unsupported by the record, and is contrary to the evidence.

1 2400.

144. The Board's conclusion that the integrity of Licensee's training and testing program failed because there O

was not a clear appreciation of which personnel or which com-ponent of Licensee's management had responsibility for the integrity of the program, is arbitrary and capricious, is un- j supported by the record, and is contrary to the evidence.

I' 1 2401.

145. The Board's failure to conclude that the instruc- l tors failed to instruct, or that the students failed to learn, is arbitrary and capricious, is unsupported by the record, and is contrary to the evidence. 1 2410.

146. The Board's conclusion in 1 2410 that the opera-tors have been reexamined by the NRC under suitably control-t led circumstances and that Condition 9 for the staffing of Unit 1 has been met, 14 NRC at 580-81, is arbitrary and cap-ricious, is unsupported by the record, and is contrary to the evidence.

147. The Board's conclusion that the monetary penalty can provide reasonable assurance that the Unit can be opera-ted without endangering the public health and safety, that

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the penalty will be long remembered and will emphasize the importance of the corrective administrative procedures to those charged with implementing them and to those charged with obedience to them, and will attract the attention of I

all interested parties, is arbitrary and capricious, is l

l unsupported by the record, and is contrary to the evidence.

l 11 2411, 2412.

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,' 143. The Board errs in not imposing sanctions against p

any company personnel except G and H. 1 2414, 2415. .

149. The Board's conclusions in i 2417 dealing with the unhappiness and demoralization of the operators, are totally irrelevant, arbitrary and capricious , unsupported by the record, and contrary to the evidence.

150. The Board's conclusion in 1 2418 that the sanc- -

tions are appropriate, is arbitrary and capricious, is unsup-ported by the record, and is contrary to the evidence.

151. The Board's recommendations, penalty, and condi-tions in 11 2419, 2420, 2421, and 2422 are inadequate, contrary to law, and in violation of the Commission's August 9, 1979 Order.

152. The Board's failure to invalidate the conclusions of the Partial Initial Decisions of August 27, 1981, 14 NRC 381, and December 14, 1981, 14 NRC 1211, is arbitrary and capricious, is unsupported by the record, is contrary to the evidence, and is in violation of the Commission's August 9, 1979 Order.

153. The Board errs in totally ignoring the issue of staff attitude, discussed in the Special Master's Report at i 282.

154. The Board errs in t 2072 in concluding that new NRC procedures will insure the integrity of operator licensing exams.

155. The Board errs in distinguishing between ethics and competence. tt 2119, 2135.

]56. The Boarc errs in making no direct finding against Mr. Miller, t 2313.

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,' 157 .The Board erred in denying TMIA's Motion to p.

Direct Execution of Affidavits and to Enter Documents into Evidence, dated January 1, 1982.

158 The Board evidenced a strong bias against the intervenors and in favor of the Licensee by continually find-ing arbitrary excuses for the Licensee's wrongdoing and in-competence.

159. The Board errs in authorizing restart of TMI-1.

t Respectfully submitted, N gA '

Dated: August 20, 1982 Louise Bradford, TMIA ,

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