ML20134L095

Provides Commission W/Supplemental Info to Update That Contained in SECY-77-75 & Obtain Commission Action on Implementation of Classification Program for Safeguards Info

ML20134L095
Person / Time
Issue date:	09/14/1978
From:	Casey Smith NRC OFFICE OF NUCLEAR MATERIAL SAFETY & SAFEGUARDS (NMSS)
To:
References
SECY-77-075-C, SECY-77-75-C, SECY-78-504, SECY-78-504-R, NUDOCS 9611200153
Download: ML20134L095 (18)

Text

_- . - . .- _ . - - - _ _ _ . . . - -

~ '

, , q. -. I , ,

3 .

~

(tq

., T * *

-y .

5 .ste f. r 7,re/

, SEP 14 197g Q(f 7.-

_ .x.# g.g n . F .. f ) &THIS DOCINENT HAS BEEN DECLASSI L ( > 'g

~

,, y. P : ; Qg.b 3

• he' g q 5 .,o4*: ~  ;'

.5, Commissioners. f4*y;[g,g;;,%R ,y y J.; 4 THE Pi10VtSl0N

'~ByAuthaty - g;7,95 y,

f For: .#4x . 'T ' -m -

1 l

ea ~ y@ Z a j.4 A ? { h,13., M,;. .tDate ofinfahkatforie fNo d".

From:

c ,[ry,1.,. C11fford

, c . V.'$aith, Jr., Director ae ,. 1 -

p, ;! ',gv gy' ' Office of Nuclear Material SafetyQ I;fj M/i p;6 , ey a%;(.h v M.i i j t '

N . .. -

MR, t and Safegua'rdsD r 'J'y # zjQ"h37,4 . -

.p,~~

/;

' I Thru: ~

..~' 1 ' pp.a) wpm 4 poses %.o;;'; . ; % ~

+4&i -

AExecutive Di. rector 'for'0perations W $ T -' .Q, '4 ; -;

l

}

Subject:

.. f .

, . \

(CLASSIFICATIONOFSENSITIVESAFEGUARDSINFORMATION I*

{ (IMPLEMENTATION OF NSDM-347) 1 .; .

7 ..

Purpose:

To provide the Commission, as requested by the Chairman, supplemental information to update that contained in SECY-77-75 February 11,1977 (" Implementation of National Security Decistor. Memorandum 347, January 20,1977"); and

i to obtain Commission action on the implementation of a

> l classification program for safeguards information.

t Category: This paper covers a major policy question.

Issue: Whether the Commission should approve an action plan for inplementation of a classification program for safeguards information.

~

Decision criteria: 1. Does the alternative of choice satisfy the requirements of Executive Order 120657 I

2. Is the alternative of choice consistent with the views of the National Security Council (NSC) regarding the information that should be classified?

i '

. et 8 . . .

- -4 Ulasnties oy

Contact:

"" .MM'IYI

~

l  ;

( ,

e) #

jj G. W. McCorkle y .., / g.syhDS[ ' b 6Al D. B. Matthews.n.c

./ #

(tjtie)

/

jt 42-74181 m .

,.. ,- Y +q / f 7 R .s ,. U ritdei'-

[r/ ph;u,St.,, CATION SCHEDJLE OF

'l .

$QQQ@] . , .

• ' ' kicuTivE ORDER 11652 AUTOMATICALLY DOWNGRADED

AT T*o ycAR NitmS AND NS EN lt NAT10NAU SECtg7y- grJ-f

• J

1. M. sMg, s[}%

^'

,,,,Jyg ' ' , .: ***"'"4 -

OPP.C E F SU nanne.g & I 6- ,

,,,, , (' ",N' t'7 ' j

\

i p . - m - -. _* _ _..-.-- .

)

9611200153 780914 '

PDR 78-504 R SECY \

PDR J

l - -

M{ 5 1

. ' - - . e 5 .l..l _..

7 9 . ph

• $ '.if h pril*f5?Tu 5. : ?. .L.

l y *:

'~

i to tyI The Commissioners N$'57'~-N%9U b WC'M v D K

, _ :, y.3 , g a .> .. -- . ..d.a n.- g m% .y a N ?"fG @ p C m :m ,e

. p. Q .

.. :e -

K' Dec1ston L6MOf.

}$n 3.ga MS &. . h&.,.y , "

u

.g/,,, Critertat "

.w:'.'j. .;.3. S*F:%"W Will the alternitive U&'T of. choice provide,Lif full /M -

[ . W 4j.(Cont *d.). . d. legal' basis!.for' exempt 1 safeguardr..>

&. wk a. . isplemented..j 1nf gDd }&.y!O% '

11c sc1o'suretMi h' M:

,* .F" Alternatises$(,M' $%Q' gyfQgg* q:ormation from 1T. Approve the)1an contaIne Q W g g{7-75 for; e ,

• g'.5.

, 47 -

r.s t^!

. @b.nentation in ~SECY-J of alciassificationIprogram ~ app 11 cable oiily r '

@.M$8@.O., k J.t.w ,.Q. ,

to ' activities: involving' sign 10 cant'.tgu'antitits'of SSNM.

Q, Defer a final? decision on' the classific'ation of security-

~ l Q . Y;fg pgmA f.V ,g C f A d,.w@M, 4 related information for commer;cial LWRs*!and M11 cit i

. -i . e.c,t '. .

.3,$' t:urr.ent'NSC views 'on' this issue as"a follow-d . -

. .ggg s letter of June 30, 1977. Continue to support enactment of comprehensive legislation to protect -

i unclassified sensitive safeguards information (see Attachment D).  ;

• ' . ,u..- -?; "

. ; ;t -

Wh. ... -.

,. . ~

a. <

2. In addition to agiproving implementation of a proposed classification program app %able to SSNM activities, approve extension of the plan to include classifica-tion of security-related information for commercial LWRs.

' Continue to support enactment of comprehensive legis-lation to protect unclassified sensitive safeguards information.

3. Pending enactment of legislation applicable to sensi-tive safeguards information requiring protection in . .

the interest of public health and safety, continue the present policy of restricting access to safeguards '

• information in possession of the NRC under existing

regulations. .

/

a. ,

v .

i O

Background:

In January 1975 the AEC Chairman recossended that the' , /

National Security Council (NSC) review the problem of . J.

public release of safeguards related information with the' '

aim of establishing a national policy.? The NSC directed.' ,

n

3. i:,. .in National Security Study Memorandse (NSSM)=216, that ang i examination be.made of .the national security impact of,the }

4 C 'i . C ., < . c-M,. '? . .

release of information relating to procedures forprotectL:) -

g. ~ .7  ? Jr. . .fl ing and accounting- for nuclear materials (including'invoor' t:f.

v-J[(yJ .I 4 1.4 Q, -torysensitive discrepancy' datal'and.to hamine options' for.'protiec'ti t g.W~ safeguards inforsation."Following the ' completion '

• G c,4yJg

..-q,y %.7;ACthu' <:of the . initial and ths supplemental reports < ~

F.$.UjJ V

Commissioners agreed that certath s rds Informatiop Q ..;,:V w:, _.. y*..r ;..g f nee w e:. . ~. protection by a classification program .(Cossais's foner (

dd

,;,. p ;. ; {;.; , 9 ;;,,,, y ,g :;t,. y y

, 3 .,; w ryg g y g y _

.r .

. ~ .% ._ :. . _. '. -

. . .d,.e. _ 2

• Currently ~this information Ge~1udes physical security plans, assoc ~ lated 3roie'du'resaidTulnerab111tyanalyses. p ~~~ ~~~ T N.

. w,a'5 ~ ~ ~

~ ~ * '

, -a...___ __ a n--- ~-. ^:~^ < .: :- ..

• * - ' " * ~- ~ '

e ,

w.. .

-m---- w

b

~

.[ , , ,~

l{.

i'~

~

The Commissioners s.

Q,:] '1:%

... ' J , f i -

M 9,.lf?Mi?;QX-M o -

, pg .

s _: m e. -

Background:

Gilinsky dissented) but requested that a decision on classi-

6{i

. (Cont'd.) fying security-related infomat16n at commercial LWRs be -

i. . -

defermd pending a decision on .GESMD. hs,wj. . y.,M:.-

l' 't .m a 3 cm pm:1w'2 qP,M.& W*.5n.W.W<.6FE W.# y+g,, .MM W On Januar;y;)50,1977,ethe NSC issued NSOM-347 stating tha 1

4fd(jf.b.1:*D.%W25";

R:6  ?.wS ;the course theof,.the Prestdont

.NSSN-216' approved thedirected review and recommendations that informa- ' de

,t _; tion related to ptqrsical'pmtection measures, material' contml

}  ;[8#C{.'.

,. - f m i.. $4 S. y

' and accounting procedures and inventory discrepancy data for 18 i

9' Q.ddf m %e. _. y F M . . ,

.i h3l,3,1.MY.tj ssignificant quantities of SSIst be classified under Executive -

l

I.. d @l'M,$;/

• 0rder .11652FClassification and Declassification of NationalSe

. . . ,', y., .1(.7.' R ' . .;>46- .., . xcability of the. directive to security information for commer-cial LWRs was deferred untti completion of the GESMO. -

l '

i In February 1977, the staff transmitted SECY-77-75 to the i- Commission with an action plan outlining how 15tC would -

i implement NSDM-347. Commission approval for the proposed action plan has not been received.

i A chronology of significant actions relating to the NSSM-l 216 review, including NRC's participation and subsequent recommendations, is provided in Attachment A. Attachment f 8 is a copy of SECY-77-75 with the following enclosures: '

i

} 1) NSDM-347 l 2) NRC letter to NSC, dated May 20, 1975 ',.

! 3) NRC letter to NSC, dated December 19, 1975 ,,

j 4) Draft proposed lett?r to NSC -

j 5) Draft proposed NRC Action Plan .'

i 6) SECY-76-365, dated July 15, 1976 i

l Subsequent to the events suimiarized above (and prior to the l l termination of the GESMO proceeding), the Commission again '

j reviewed the question of classifying security-related infor-nation at commercial power reactors. By letter of June 30, 1977 to the NSC, Chairman Rowden indicated that the NRC was

~

! in the pmcess of. consulting with t>e NSC staff prior to i . _.  ;. ' implementation lof NSOM-347 and set forth a mvised recom-l

't ( ' . ' .' , "X *

,, ,.,' mandation that security plans for power reactors (and certain other reactors) .not covered by the NSDM-347, decision should l

! .f. .

, y _ .M, be classified under the ' provisions of E.0.'11652 to protect 1 .?

'l,-r, them fmm unauthorized disclosure.~ ~This letter requested

t. d W NSC views relative'to this point and noted that Commissioner

'. ""/,j ,,"~ ..R? 'Gilinsky was not in agreement.'., The staff is not aware of l  ;, M

~.

..ary reply to the June _30 letter, which appears as Attachment j ..c _ .__.; .5.f . . .G" ~' C (minus all enclosures except that containing the separate l j views of Commissioner Gilinsky). ~

~ ~~

{ ,

r = . w . . ..

m..... .

j eatuk c.,-- _ _ _

• m . - -- -- - - .-

k l

7

~

. k .

m. -

y The Commissioners ,'; , V. .

2 ,a il Discussion: Following the staff's development of the action plan for-

'"M} warded with SECY-77-75 there have been no comprehensive actions taken by NRC to implement a classification program generally applicable to SSNM activities or commercial LWRs.

I "..'

• '~

, . . . There have been, however, subsequent developments pertain-

'n ing to a) proposed legislative changes and b) a 'new Execu-jh

~

.* 2 <

tive Order which must each be addressed in terms of their

, l; 'Y-v ~ impact upon the-Commission's' current review of NRC programs

i . v"., for the protection of safeguards information. .A discussion 7 .T gg, o

)g of each'of these. developments and impacts fo11owstl.6 .

,g .7 7 p s97,.  ?  ; gggj ,, ,j , g, a.

Legislation ; A rZ 4e ,g i'

il '

2 - ' -

~

J w.p W ~

1. s .j n. 3 E,y] , , -w v .

..gv ,

{ Under the Cunnission's present regulations site-

!i specific u feguards information is " deemed to be

,l commercial or financial information" and has been

{ withheld from public disclosure while in the hands

!}

i of the NRC based on 10 CFR 2.790(d)(1). The Commis-sion's regulations do not presently address protection i;

of the same information in possession of the licensee, jt nor do the regulations provide a basis for the Com-mission to assure the trustworthiness of licensee l employees and other private parties for access to 4

safeguards information. 3 l

The legislative proposals developed in staff papers i SECY-77-611 A through E formed the basis for a draft  :

j bill to amend the Atomic Energy Act. By letters of i May 23,1978 (Attachment D) to the Speaker of the

House and President of the Senate, the Chairman trans-mitted the NRC legislative proposal to provide addi-

tional and confirmatory authority to the Commission.

!' While recognizing that the Commission may control access to safeguards information determined to be National Security Information in accordance with E.O.

11652, the Chairman's letter to Congress notes that "There is no existing law which expressly provides that unclassified NRC sensitiveesafeguards information be tithheld from disclosure" (emphasis added). Such unclassified information may have significance from the standpoint of public health and safety and should be protect $d from either compulsory or unauthorized disclosure, as distinct from certain safeguards informa-

_ tion the release.of which could rwasonably be CCO g

, N expected to causer sed %dayle to the national security

- _mm and which is properly classtfied under the Executive rer% _ _ _ ,

4 gy,g, p .rd - l % . s, . s. s .

DUhh&GSE >

eats >

l NRC 708M $18 (MH NRCM 9344 p in m. eevammesswr renomme eersons se,o - es ema

~

y 4.h%'y;#

y. The Commissioners. -

p i

r Discussion: Order. The proposed legislative chan es would, -

h. -

0;ont' a. ) among other things, establish an explfcit statutory basis for exempting sensitive safeguards informa- f'

,l- .. .w ,.

tion from disclosure under the F01A.. ; y.rs . . . ,

1 I;T"A 3 a .q Kl ~. ; :. % a. ,? y

. . i y %;  ; p nn:%,4Q{f 9 t; g g , ,,

1 fs -

N ;,. b. Executive Ordergpry.,1 .s '

_p. -

y , m.a s .,, a

~

l

.-+_< g y y (y$ 7.. p .-~ 'In a separate action,-the NRC responded to requests l

, .. 7 g%Qf f.,,a ; , ;from the Off1ce of Management and_8udget for-views . + '

l 3'

t s

/ 4. ]EA. *6 :& ; The on'a proposed Executive Order to replace E.0.'11652.

last response was contained in a letter from the

~

~"

i l

s . 7M

Chairman to 02 dated January 30,1978 (Attachment! '

~

'1 .E). The new Executive Order (E.O.12065) was-issued N l on June 29.-1978 to be effective December 1.1978f-V Included therein is a specific refer -

~

+

(Attachment F).  ;

• ence to a category of information relating to nuclear ,

safeguards (generally consistent with the Commission's earlier recommendations to OMB, dated October 25, 1977);. " i i The following pertinent portion from Section 1-3 cap . ,. .

tioned "Classsification Requirements" is quoted:

"1-301. Information may not be considered for  : ",

classification unless it concerns:...

r ,

"(f) United States Government

• programs for #

safeguarding nuclear materials or facilities;...". '

<i The portion of new the Executive Order which relates to A \

the application of this requirement is also quoted: 4""  ;

• 1-302. Even though information is determined .

to concern one or more of the criteria in Sec-

' tion 1-301, it may not be classified unless en original classification authority also determines -

that its unauthorized disclosure reasonably

. could be expected to cause at least identifi-

- ^

able damage to the national , security."

'-,_ . n. -

(

,, s  ;' n ' ^ ,,

• * /'a s

• The word " Government" did not appear in the Commission's proposed wording

! supplied with their October 25, 1977 comments. The Coenission's response t of January 30, 197.8 did not address the inclusion of this word in the- -

4 I later version. - - -

,. -.N' '

w . ,  %. ...

[$ 5:

~

[ [, [ .

7

, ~,$.

~

4 .m . ;m ps. . =k v % 3ef Wr W W *" " ,

~-#

'C W .'S<n

> 4 em W I h pme saa teasp sees enes. s , t en e, ,'am_e.st-am.ame

,,,,,,,,. r

_Ad '

f

- ~ a.~. a a=: 2  : n . a .~. T~'~\

l R ..*

f

. - h. .

• J.

I4

!y The Commissioners '- 6-1 ,'

.n -

O f Discussion: The issues surrounding the implementation of

/- (Cont'd.) , the action plan contained in SECY-77-75 are not j '~

en expected to be materially changed by the contents. . . -

,) ,4 . o . ,. . 4 ,... ... s.s; - -O of the new Executive Order. .w.,:. ' .r. 3. r 1 . . .J z,y. ~ e c .: - e; .. d.; , n. e . w o * ,

..w.w.

s .3 /, .. a>- '

. x . > ~ L,6 [e51m* ^

_N

^

[

%7 r 9% *5 The' e still remains a neid to examine the relation ~. *

. :', J ;, . : '% .

ship between the implementation of a classification <: -

M l

' j .Y

• I C 7,; o h , program in connection with the prStection of safe = i ..,.,

g .

.g_ui? E M M ^. guards information and the protection offered by the

) .;  ; -

.go ,.

proposed legislation.':Information related to. the c "

, Tj

, '

N l 1 protection of the public health and safety and pro i~

~

l i

tectable under a legislative amendment (and thei '

ji

• associated <1mpWt4mgeegulations) could include i

I information that is also classifiable from the stand -

4*li point of national security. The program implemented

• l in response to such an amendaent would not affect the - "

i ability to classify information which meets the ii criteria of the Executive Order and is determined to #

jj be National Security Information_(NSI) by..an_officiaLA .

with classification authority. k Neither of the above developments appears to substantially l' modify the basic issues surrounding the general subject of .

) protection of safeguards information. Future deliberations

will still require judgments as to whether infonnation is ji (1) information hetermined to be NSI under provisions of l

' the related Executive Order in the interest of national security or is (2) information which does not meet the

! classification criteria of the E.O. but which requires l protection in the interest of public health and safety and l for which means other than classification (e.g., specific legislation) must be employed to prevent its disclosure

- while in NRC or non-NRC hands.

i.

Establishment of the specific types of information falling l6 within the first of the above two categories of material; ,.

i i

' 1.e., identification of particular sensitive safeguards i

~ information as NSI and subject to classification in response

,- to the requirements imposed by the Executive Order, vis_ a recessary element in the implementation of a classification

..y program.D Classification action taken through the use of1

., ( '

- classification " guides" agproved by an original classifica- u tion authority is' termed Derivative Classification" .in i -

4 lI '

E.O.12065. The.following . extracts are pertinent: X r ',

j ' '

4

':f .f u

' ~ , , i ]. ;' ,  ;

4 re.rpy-- -- : sg.apa smenga4v9mpgrewye

.es %== , .*a p.w __

('W"8'*'2 ,f f % . % ;T 7 If

, 4 ..

---

J .

_"~.l SweetAen. h -

. j m .,' '[ '

g g man n 5O *

' T;) '

! 'N =c === = = ==a. __. *= -- ~_ _

. , p ,

,. u. f.9

. . , - m , _ m. [ i 1

. f.

, k g -

W \

p' .

i.g The Commissioners E ~. .

g h Discussion: *2-201. Classificadion guides used to direct (Cont'd.) derivative classification shall specifically .

3 , .

identify the information to be classified.... -

k [k 32-202 kb...

f '

o .

h h such guide'shall $ appIoved' C,- 2W itg;l ., ., ' personally and in writing by an agency head a E rJ ll1 '

listed in Section 1-2 or by an official'with_- Vp

,M . / ,, - C.;,gM'q'J.

'?F J. Top Secret. classification authority. 'Such 4 .". "f, -

1 wme - 3d;;i:a approval constitutes an -

{, - '

• ' ? ,,g ,y.%g tion decision.",ng g, original classificaff.j,3b) .

. .n, :n ;, e .

s - -

n . .s a ;.y

(

c

. ' , ' ~/, ' ' - - ~(The Division of Security .1s4 currently reviewing the new -

1 - -

Executive Order, to become effective on December 1,1978, i '

with the intent of disseminating additional information i regarding its provisions.)

i t '

'i :; It will be necessary to identify the types of information that would require protection in connection with NRC imple-3; ~

mentation of a classification program such as described in the action plan forwarded with SECY-77-75. Thus, the need i still exists for an expression of Comission policy in con-i' nection with classification guidance in order to permit implementation of the existing, or an appropriately modi-fled, action plan. In addition to addressing certain other i

specific classification issues, the guidance will include

(1) the selection of nuclear activities that present a

! , potential for harm to the national security steming from

)i successful malevolent acts and (2) the specific categories

of safeguards infermation that require classification.

The first detemination was explored at great length during i the NSSM-216 review. The Commission's prior recomendations ,

l in this regard were sumarized earlier under Background (and as itemized in Attachment A). Although the NSC specifically - .

l addressed (in NSDM-347) the national security implications. i associated with the handling of plutonium or highly enriched uranium, it has yet to express an opinion on whether informa-

. tion related to sabotage protection'at licensed LWRs (using ,

uranium fuel of low enrichment) necessitates application of j

., q - national security classification. m ,, .3 /

v. n .

.. y e 3

The. identification of categories of safeguards inforination -

(g 1 ,, ,

that require classification rests, in some instances,' upon ,

3 judgments reg'arding the expected value of the information /.

j { ,,

to a potential 4(gypry.,, Information concerning inventory . ,

j discrepancy; data was identified as a distinct category of y(;

, ,,c . .

. - t 7

, l

~... ...:

g f

J, i => _ -

~~

N-l senc somm m p.m macu .2.

~~~

, = = =- . m . m.m .. . ,, ..,. -

4

ryt.'; i

~:

3J O g, 3.

g* :. y V The Commissioners - 8-

<[b-: 1 .

l ~( Discussion: classified information in NSDM-347. However, information

. (Cont'd.) concerning measures for physical protection and material 7j h.12 s control and accounting is expected to require individual

A M ,s: A- evaluation to determine if the disclosure of such infor-o , y:

.c t M. 1, '. re,t i;M%.;sg. ' nation may be reasonably J.

Nt- . Anw#

expected ,

l k.;* i - diversion

.L . loraL.'sabotage.*+l3.

's l $[ 'M Ji, b?,b Wil '

y qv1 :: $,b; w, ~

4. (q.% 4Draft classification criteria addressed to specific'cate-l ' ?! 79 6[,44.' 4 gories of safeguards information associated with S$40Wc

~ E' " i;"( activities was discussed .in SECY-76-375.'(which was',11a ' "

j ~d* "

. turn, forwarded with SECY.77-75). Attachment G to.this paper summarizes the criteria proposed earlier ;and reflects i

a modification to the original NMSS position on classiff-j cation of specific threat information.

l The establishment of policy as it relates to this overall issue is presently complicated by the absence of an NSC response in connection with extension of the authority originally granted in NSDM-347 to include security-related information at commercial LWRs. The NRC is presently included in the list of agencies authorized to classify NSI consistent with the provisions of the current Executive l

4 Order (E.O.11652) and retains similar authority under E.0.

12065 (subsequent to its effective date of December 1,1978).

(From 'a technical standpoint, there is no requirement for the Comission to seek NSC approval prior to taking action consistent with the Executive Order.) Notwithstanding the above, the staff's review of the specific issues related to classification and the more general problem of protection of safeguards information has suggested the alternative courses of action discussed below:

The application of such a " test" has implications beyond that of developing uniform classification guidance -- such judgments establish the basis for exempting the disclosure of specific portions of documents under exemption (1) of the F01A. At the present time declassification reviews are mandated by Sec. 552(b) of the FOIA and 10 CFR 9.5(b) whenever a classified document is identified in response to an FOIA request; the reviews have as their.pur-

, pose the segregation of exempt from non-exempt (and therefore "releasabl.e")

portions of NRC records. . Further, following the effective date of E.O.? - '

7-'

12065, each classified document will have to be marked to indicate clearly which portions are classified (with the a 11 cable classification designa-tion) and which portions are notgj . .,

f. Sec.1-504 of E.O.12065).

. i 3

i, 4

. .e. > a eunessent > ,

? 9 '/

OATE F

, NRC DOEM SIS (974) NROL 8240

• u. a. oovanesessert emismme orrscus s.ve -essene / ' *

{r. .

13 .

~

. O g O , ,

g&l ,

' ' ~

[ The Commissioners -

j h , ~

l a;;  !

Discussion: Al t.1 . Appreve the action plan contained in SECY-77-75' .

~

g -

T (Cont' d. ) ifor implementation of a classification program i l -

applicable only to activities involving signifi '

4..

j ,,

~

's~ .

( cant quantities of SSNN. Defer a final decision infor- ~ Y

~"

.i + 1 on the classification of security-related

;"_ , wJjfi* metion for commercial LWRs and solicit-current " A: .

~

4 *4-, NSC views on this issue as a follow-up to the .' aA.

1 j e i, , /e."

J. >- IRC's letter of June 30, 1977. Continue to i ~ C L ,.

i,

...;y,- ~

support enactment of comprehensive legislatick :4'f

! .. ,e to protect unclassified sensitive safeguards. v M I ~'-

js '

infomation TAttachment o).- e N M ? ? ^ .; '; '. . )

.s -

~

..  ; _ 8 ,

.S _

~ 1 , .-

!{ Immediateapplicationoftheproposedprogramt5tafeguard? l 5;- l

{p information for SSNM activities would remove the present - "

-l . inconsistency regarding the treatment being afforded to *' r 4 similar infomation by the Department of Energy (by virtue V a ilj3 of their implementation of the NSDM-347 dimetive). This has already been noted by several NRC licensees handling Ne," m

• 'l: ,

! SSW4 under contract to 00E. This inconsistency was recently ~

l! addressed by the DOE in correspondence to the Congress in . , '

i' connection with the Omnibus Anti-Terrorism Act of 1978' l (S.2236). (A representative letter is included as Attachment

]

. H.)

4 .,

i +

The first alternative would result in protection of safe ' ~ ,J l'

4 guards information consistent with the results of the inter- '

l agency review of such issues conducted under NSC aegis I f

(NSSM-216, etc.) and with the Presidential decision reflected 4 l in NSDM-347. a -

,:.1 .-y

, .n I

Deferral of decision regarding commercial LWRs is compatible 2 - l with the approach to this issue taken in the NRC's earlier, j o l

excluded from the classification program i letter to NSC on this matter (Attachment C). Informationi  !

!1 envisioned in Alternative 1 (e.g. LWR security-related infor';- ,

{

mation) treated, while but still requiring in NRC hands, protection as proprietary will continueinformation.i to be@i * > ; y ,!

Enactment of the Commission's legislative proposals 1si ' $h_ 3. !

! necessary to complement the proposed classification program,% > i j The legislative changes recommended by the Commission wodld(:! ": ,

provide authority to protect safeguards information.that,\ , f 1. , I I .

although not classifiable, should be protected because of. _.

l its significance 'from the standpoint of public. health' And f ',','

j safety. (In the ins,tance that a subsequent decision were.w' made not to claestfy<asemN.ty information for LWRs, then 'e 4

i lg the legislative proposal would provide an explicit statutoryM '

k

-l ,t' e

basis for protecting such inforisation.) ', ,

.3, wjn mk m ~

} ""' ' * ! ,

s .

I \

i! .

i! )

I.

g ,, ,

i

4. 7 :-- -

l

a ', .

• l 4 ..

The Commissioners - jr

, Discussion: m. Al t. 2 In addition to approving implementation of a w- (cont'd. ) Q'y :n ; ' proposed classification program applicable to i' 5f6 SSNM activities, approve extension of the? ' .S a G A ~e ~ ,

. p;6 t)- o T.. . ' action plan to encompass classification of S k 1 , .'

,) I.c ,

T? c,  ;

'securit,y-related information for commercial, U's 7 y . M A, J '

'LWRs. Continue to support enactment of com-Y _

, f $ . )t M prehensive legislation to protect unclassifled.

. X , ,y,q.p~ * ;.p ;? .s sensitive

, safeguards information.'E gr- - e.

pa'3. s . ,. .

1. e 3 . ,, p . .

,.c < .

,'T The only substantive distinction between this appmach ~and

.. u Alternative I would be an independent Commission.detemipa- _

l tion that certain IAR security information is national security _

infomation and should therefore be protected in accordance i with the applicab1e requirements of the Executive Order.

1

Selection of either of the above alternatives will rvquire adoption of comprehensive classification guidance. Criteria

, for the development of such guidance has been developed by

! the staff for Alternative 1 infomation (summarized in )

! Attachment G). The criteria would have to be modified, in ,

case Alternative 2 is preferred, to reflect its applicabil-i ity to both SSNM activities and power reactors.

Implementation of any form of classification program will require the granting of NRC personnel and facility security clearances to those licensees requiring access to classified information. This issue (and its relationship to the pro-posed clearance rule for persons having access to or control over SNM) was addressed most recently in SECY-77-290A deal-ing with proposed Parts 25 and 95. The Office of the Secre-tary returned SECY-77-290A without action pending resolution of the issues discussed herein. The proposed Parts 25 and 95

.are identified as a key element in the action plan forwarded with SECY-77-75 and will be resubmitted, as necessary, in

+ connection with the possible implementation of either of the above alternatives.

! .~.

.c . -

s l-

^

O' " Al t. 3 Pending enabtment of legislation applicable.~ L 7 _ "... to sensitive safeguards information requir . , ' /

• v- ^

- . , ing protection in the interest of public v ri l

-P* ,'

health and safety, continue the present

• T '

a  :

5. .

~

+

7 policy of restricting access to safeguardst s - c,

(

. s . infomation in possession of the NRC under. ( P f

'J" .4 .  % . ;1 < exisy gagns. n ~ :. .S b i .

- .*g W

'] NRC 70RM He (p.76) NRCM 0240 h ui s. oovanmuswe rassmine omcas seve-ass 4a3 I l

,' h m , .

4'

! "t {(, '

The Commissioners = 11 -

I):i

/'

! ; 'l Discussion: The third alternative is a continuation of existing

!'+ (Cont'd.) policy while wrsuing more comprehensive statuatory j- . .

authority. The shortcomings of such an approach, in the ,

x f , &,.4, ..e . near ters,'~ relate to (1) the existing inability to" assure 4- r:.. ' ' h. . .~ . 'y.

l i

' protection of safewards information in non-NRC hands. (2) 4 the existing inabi' ity to assure the trustworthiness of i

1 e h c.;4J" ^ J; , M.? p- .

personnel who may have access to this information,~and (3)

- N.. C the possibility for a successful legal challenge under the

. t -

2; .6 . v. ..f.'t ,. . F0IA to the use of the proprietary designation. Further.

l

- ~

.' ~W any additional delays on the part of INtc la establishing a i f ,v, classification program for sensitive safeguards.1'nformation

~.<,.,6 .

~ ' may raise difficult questions as to utty we have not taken i

i action responsive to NSDM-347 (and E.O.12065), especially j in light of DOE's action resulting from NSDM-347 to classify certein safe guards information in the hands of some NRC i

licensees. , j

~

1 l  ; Recomendations: That the Commission:

l

1. Approve Alternative 1: Approve the action plan con- (

~

' tained 1n SECY-77-75 for implementation of a classift . '

j ,

j i cation program applicable only to activities involving " \

i significant quantities of SSNM. Defer a final decision s 1 1 on the classification of security-related information h" I l for commercial LWRs and solicit current NSC views on this issue as a follow-up to the NRC's letter of June 30 ,

i l 1977. Continue to support enactment of comprehensive' -

legislation to protect unclassified sensitive safeguar

~ l information. f'

2. Note: l

s. that the action plan forwarded with SECY-77-75, if jk l approved, will provide a basis for future staff ji i

actions related to implementation of the classiff-l i

cation program applicable to SSIM activities.

'kA, \.T'I

., b. that the preparation of a cIassification guide as ; J s '

i - -

part of the proposed action plan requires Commis- '

l . -

sion action in connection with the criteria dis-

! N cussed in Attachment G and that the classification 3 guide will be submitted for final approval. ,

~

l .

C . z ...? - -; : , .

b '- J A 4.: _ . '-

, " -A c. that personnel *and~ facility

' clearances will be 3

,. ~ ,. [ requireW,#ffected licensees, therefore, pro-posed Parts 25and 95 (including NRC and licensee resource estimates) will be resubmitted.

W us s. novenumswr paawreme oma em-M NRC PORM 318 ON) NROf 0240 _ _, , _ , , , . . _ . .

h,, . ..

The Commissioners

. O y-

.I((h

~

! Coordination: The Offices of Inspection and Enforcement. Nuclear Reactor

""v Regulation. Standards Development and Administration and

~;% -

the Divisions of Security and Rules and Records agree that i; . .; .g Alternative 1 is the proper choice. The ,Executtye.' Legal , ~~

.  ;). - w.,_ ,: c

/ O : ; ,.av.

g. a.,~ ~- i:. Director

.- has

- -- no legal

- w .. ob,jec.

. tion.mp'4 - l- j

.>,t w y 7.4*m.mgy w,

-*S-

.,7.

~ , . ., N'; , .,?."

1. '  ?.3 .7 .o "g,,,,,4 # . . . *

...iT~-

P - 5),'

.7 93 @ ag.e,3*'re,_ 'f.' y' ,* w'~f v t (  ; y, y' y ~ . , . .iM

, '0GC and OPE comments ceived and res'ponded to at Attach-I F* ments I and J. respectively. In addition to requesting '

5 % . U %.% .:. - .further information on several facets'of the staff's analysis.

./c Q;f*-. .% ", , 0GC suggested two additional alternative courses of action a

'- available to the Commission in connection with the earlier

. (June 30, 1977) recommendation to the NSC on the'classifica-

tion of security-related information for commercial LWRs.

m,,

NMSS agrees that additional options exist relative to dis ,,

l position of the earlier NRC recommendations but believes such options represent variations upon the three basic alternatives offered by the staff. NMSS responses to j this and the remaining OGC consents appear at Attachment !. '

j OPE agrees with that portion of the staff's recommended

j Alternative approving implementation of a classification j program applicable only to Ifcensed activities involving SSNM. OPE does not believe, however, that Commission i

i  :

solicitation of current MSC views on the classification of j

security-related information for the licensed LWR industry is appropriate or nedessary at this time. NMSS and NRR believe that it would be prudent to communicate with the NSC on the LWR classification issue. The HMSS response 4

is at Attachment J.

Scheduling: It is recommended that this matter be considered at a closed meeting in view of the classified nature of the -

!

• information involved (see staff Sunshine memorandum for-t warded separately).

! M gu TalsuNb

_ . . ~ .

. . - . . ~

... crmos v. 888* "", j C11fford V'; ~5mnh 'Jr. . Director ' ~~

-' ~ , , . h, . Office of Nuclear Material. Safety

} y, ,. -l'.'.ie.,-.~ .and Safeguards. .-.;,'  ;,f. - '

j Attachments: .. T' ,[.i ..

History of NSSN-216 Actions . . 5./ NOTE:Last page retyped to4coordinatecq l A. ' -

with OGC and OPE and to include

!. B. SECY-77-75, dtd Feb. 11,1977 -

j C. NRC ltr to NSC. dtd June 30,1977'. 5' , . 'theresponses

• 0GC/0PEatcomments Attachments andI NMSS and J.

3 D. NRC ltr to Senate, dtd May 23, 1978 c ' '

l E. NRC ltr to OMB dtd January 30, 1978 .(See Previo'us tellow) -

1  : r- rvorun v. n. n. 19nac -a AM a. l

{

l l

• • • G*y Background Pa >er on SECY-7d -375

" Class-tfica :10frCritWP14' WRRD(

NDentOn Dr 5ini (S

• EDO

~EVGossick

) .. ... a,. mr it, to c.aate_for.sen : etatsm c- ittee, m aone i

k i j

. ,I . MSS . Response. , - to. OGC , .C.ommer ts 9/ /3 /M

/ $ 9/ /7 NaC 30au 318 (D 76) Naot 0240 h u. a. oovsaseuserv sasusmne omca. seto -easaae 4 e .

0

.' , . .+ hr e .,

{f The Coenissioners g

,i ,

! (; , )g Recommendations: b. that the preparation of a classif tion guide as

'74 (Cont' d. ) part of the proposed action p1 quires Commis-l.' .

sion action in connection wi e criteria dis- l W -hi ,' cussed in Attachment G and

'c guide will be submitted at the classification '

1  ; , 2 v l  ; M , s , . ,z'3 A. the Commission for fir.a1 i

.r*-

>;,y.y y approval.'t. :

- gq 4

~

~;g

.-A's n cy ~

e -4 - -. , ." %;f _ N. c. that personnel 'and cility clearances M11 be

~',_ -

T'

_M required for aff licensees, therefom, pm-l, '

posed Parts 25 95 (including NRC and licensee

.  ;-e ^ ,; , F y,[,. ij . - -

resource est tes)> will be resubmitted..9- ,

n ..

j , Coordination: The Offices of I ection and Enforcement, Nuclear' Reactor

Regulation, an dainistration and the Divisions of Security 4

and Rules and cords agree that Alternative ] is the proper i choice. Th xecutive Legal Director has no. legal objection to the a ton of Alternative 1.

~

l OPE co urs with the selection of Alternative 1.

4

Scheduling

It reconmended that this matter be considered at a closed ing in view of the classified nature of the information volved (see staff Sunshine memorandtsn forwarded separately).

i i

Clifford V. Smith, Jr., Director i

Office of Nuclear Material Safet;y and Safeguards l

Attachments:

A. History of NSSM-216 Actions .

i B. ECY-77-75, dtd Feb. 11, 1977 -

C. NRC ltr to NSC, dtd June 30, 1977 4 l D. NRC ltr to Senate, dtd May 23, 1978 0, ,~\

E. NRC ltr to OMB, dtd January 30, 1978 ~

y i,

F. Executive Order 12065 ,}/

! G. Background Paper on SECY-76-375, -

- I '- 0. g,s i

"Classificiation C * -

3gp r' W V' H. 00E ltr to Senate Fore s Commi 1 , dtd June 19 978 ,-

DBMatthb/ek's S \h 8/ /

i' ., l SGP SGMC GLI .

' Sli. '

SG g ' Sk GWMcCorkle JGPar ow APowers R} TFCa pr iRFButnet-1 8/f/78 8/\ / 8 8/l /78 8A 8/f /73 8/i//78

.NM

\

orr c.> lE ADM/DRR/SEC _@ I/*of , eld _ NMSS EDD l ...u.* bh./ h6UI/~ HShapar CVSmi th ,J r. LVGossici

, o,. , 8// /78 7pr 8/ /78 _8//3 /78_ 8/ /78 8/ /78 8/ /78

NRC PORM M8 (9-76) NRCM 0240 D u. s. sovenmusw, enmesmo orrects s.ve - e. sana

• { ,

f

- ~ ^ ~ ~~ ^ ~ ~ ~ ~ ~

l} i ^ }

!D *

! t . The Commissioners i

1

. Il e,

l 1 Recommendations: b. that the preparation of a ciassif tion guide as 1.

, y; (Cont' d. ) part of the proposed action p1 quires Commis-i . y I sion action in connection wi e criteria dis-l .t ^~

cussed in Attachment G and at the classification guide will be submitted the Commission for final

'; y -

- : ,- appmva1..

... c g . , p -- .-

i ,

.s . .

,.. 4,.- , .

'J

c. that personnel'and l ,

111ty clearances will be i ,

. : .., , ' required for aff licensees, therefore, pro-

74 . ,V ';'f posed Parts 25 95 (including NRC and licensee

?l - , resource est tes) will be resubmitted. :. , ,

c . -

, Coordination: The Offices of I ection and Enforcement, Nuclear Reactor i Regulation, an dainistration and the Divisions of Security

and Rules and cords agree that Alternative ) is the proper l choice. Th xecutive Legal Director has no. legal objection i to the a ton of Alternative 1.

~

i i OPE co urs with the selection of Alternative 1.

l Schedu11ng: It recommended that this matter be considered at a closed i ing in view of the classified nature of the infonnation volved (see staff Sunshine memorandtsn forwarded separately).

i l

l 4

! Clifford V. Smith, Jr., Director Office of Nuclear Material Safety l and Safeguards Attachments:

A. History of NSSM-216 Actions .

! B. SECY-77-75, dtd Feb. 11, 1977 i C. NRC ltr to NSC, dtd June 30, 1977 4  !

l 0. NRC itr to Senate, dtd May 23, 1978 .#. 'l E.

F.

G.

MC ltr to OMB, dtd January 30, 1978 Executive Order 12065 Background Paper on SECY-76-375, - I ~'

jj

.i g

H. DO rt nat F s Commi P dtd June 19, 978 tthbs/eks 5

]

4 8/" / l' .

SGP SGMC GLI 9' ,

SG Q sci 4

I GWMcCorkle JGPar ow JAPowers R TFCar fr  : RFBurnet-4 l 8/I/78 8/4 / 8 8/l /78 8 8/ I / 3 8/i//78

\

l . , , . . ,

IEMM ADM/DRR/SEC _@ i 7h, eld NMSS EDD l

l bh[

8// /78 1/2s 8/ /78

%VIUF~ 3

_8// /78 HShapar 8/ /78 CVSmi th ,J r.

8/ /78 LVGossici 8/ /78 NRC PORM 31s (9 76) NRCM 0240 1'r u. .. .ove.mu swv p.swrim. or,se s4 s er. . . ma.

j, .

_a = = - - - __. _ _ _ _ . - - - -- - - ~- -

,8 i7N4"*

1 4,g . ,

, I*. ,

1 .

si' 1 :.  :

• e l -

~ /

ones t ROUTlh AND TRANSMITTAL SUP 8-17-78 l

m gueme. omes symnor. ,o.m n mner, i meis osee f @ng, Agency / poet)

, (; 3, Tom Rehm l L JA >

g b A

c's ' 'c: . -

i r gg~ - .

4 cror s.

l ma.n rue CSO4CC C ' -@Q~%

n y o ,ei por ene,en,.

note and Retum

, , con,,,estion j na Recruested For Correction W. pre Iteply -

Can:ulate For Your Information See Me

___ comment savestt-+- s+;-se C.~.enetton Justify i

This is Attachment I (ONMSS Response to OGC Comments) for addition to the staff paper on the implementation of NSDM-347.

DO NOT use this form as a RECORD of appro,els. concurrences, %* -

cieerences. and similar actions FROek (Nemt, org. s A 'ency/ Post) c g g g,g Room No.--Olds.

D. Matthe e 918 - WilTste

. O C U C'.0-  %%

C e CC7CD 74I81 O, ('N iC..I W

,. g "-.'

4 U.S G. P.O. 1977 241.$30/3090 OPrionat rostu 41 (Rev. 7-7s>

gg . %#h1

1 hQ Y *. .

l s

'j ,

' f, _

/* .

• v.dTED STATES i .

' I - NUCLEAR REGULATORY COMMISSION i I WASHINGTON, D. C. 20655 l

Cg; - . - August 3, 1978 C:O:t L.. .

! e C:eQt2C

~O'4

' .i]'O C C~O:E It $[

le C 'fr

~O6Ck -

For your concurrence / comments.

pressing.

Chairman is I would appreciate by 7/8 if not too difficult for you. Only Enclosures A & G included in this copy--others should be known to you and mostly background.

I T. A. Rehm, O

Attachment:

Memo to Comissioners from Clifford V. Smith, 4 l

Subject, CLASSIFICATION OF SENSITIVE SAFEGUARDS INFORMATION (IMPLEMENTATION OF NSDM-347)

C e c e. .

. O CL C S 0. :C

.O C IC CIe- :T ~~ '

(.

a s.w _

= -

s

K'"- .

h .*, * ,

_ =*

• t' ~ g .. -

(-

, */ "*

• ITED STATES

[ , , <%,g '

, [ NUCLEAR REGULATORY COMMISSION

. , waamorou, o. c. aosss

,, , 3 fj

....e / I

'.x

.e:oc :c r /,hp

.pfl 6p glW )($ , .

y f,e

O'4 G.7

s 1

(O f '

gf

(

C'O.4 g WS(

c:e e a y 4 CCW; l , p'

}lIIr I ~

'. c&

h. g) A l 1

l I

1

)

l i

I

O l2% As.iled.CA 4 Mar- ul k A Q.aaf NM+ Pu snu oO W%% b.h y >>AT.i 9,

+

l -

CGO. . .

OCi.e.Cki ,

.U.01 i C S C C:C:4

! ' 10 ( ' ;CJ l

. CIe . - ';C.D 1

' pJ. . , ,0.4 '

C h

• f1.

t

R*1; . ~ -

( , q' .

j[*

S8d'#%. v UNITED STATES s

g.

I$ NUCLEAR REGULATORY COMMISSION WASHINGTON, D.C. 20565 g

. a ~t h, p# '

K' 'c, 5

.J ***** July 6, 1978 CHAIRMAN MEMORANDUM FOR: Lee V. Gossick Executive Direc r for Operations FROM: Chairman Hendr k

SUBJECT:

NRC PROGRAMS FOR PROTECTION OF SENSITIVE INFORMATION In connection with the new Executive Order' issued by the President on June 29,1978 (E.O.12065 " National Security Information"), I have been reviewing NRC's programs for protecting sensitive information.

In particular, I note that the Comission has never taken action on the staff proposal contained in SECY-77-75 dated February ll,1977.

I believe that it would be desirable for you to have the staff review this Comission paper, updating it as might be appropriate and resubmitting it to the.Comission for consideration.

cc: Comissioner Gilinsky Comissioner Kennedy Commissioner Bradford Samuel J. Chilk, SECY Ken Pedersen, OPE James Kelley, OGC t

e s

Rec 'd Off nat._%.D$'geq_7 s, nm._ g, u a