ML20140D135

Response Opposing Order CLI-85-19.Order Issued in Response to Petition Not Recognized by NRC Rules.Requests That Petition Be Dismissed or Hearing Convened to Afford State of PA Opportunity to Evaluate Facts

ML20140D135
Person / Time
Site:	Three Mile Island
Issue date:	01/24/1986
From:	Au T PENNSYLVANIA, COMMONWEALTH OF
To:	NRC COMMISSION (OCM)
References
CON-#186-871 CLI-85-19, RA-EW, NUDOCS 8601290193
Download: ML20140D135 (12)

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GPU NUCLTaR  : 50-289RA

50-289EW (Three Mile Island Nuclear  :

Station, Unit No.1)  :

COMMONWEALTH OF PENNSYLVANIA'S COMMENTS ON COMMISSION ORDER CLI-85-19 By order dated December 19, 1985, the Commission requested the parties to the TMI-1 restart proceeding to comment on the request by Masrs. Robert Arnold and Edward Wallace for a separate hearing to determine "whether the adverse implications about the undersigned's

[ Arnold and Wallace] management integrity are factually substantiated." CLI-85-19, at 2. The Commonwealth of Pennsylvania offers the following comments.

Background

The Commonwealth believes that this matter is worthy of the Commission's attention, since it involves the root causes of the TMI-2 accident. The Commission has devoted considerable resources in establishing the causes of the accident and in insuring that those individuals who had a role in misconduct before and after B601290193 860124 9 DR ADOCK 050 bh)"

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i the TMI-2 accident do not participate in managing or operating TMI-1. The instant matter involves a formal report to the NRC from Metropolitan Edison Company, the operator of TMI-2 at the time of the accident, in response to the Office of Inspection and Enforcement's list of violations arising out of the TMI-2 accident.

The response, date,d December 5, 1979, included corrective actions to be taken by Metropolitan Edison Company management , including Mssrs.

Arnold and Wallace. The Notice of Violation '("NOV") and the i

response to the NOV from Metropolitan Edison Company dealt with numerous problems having significant safety implications.

As part of the response to the NOV charge that Emergency Procedure 2202-1.5 relating to " Pressurizer System Failure" had not been implemented despite recognition of high temperatures measurements in the discharge line, resulting in a significant loss of reactor coolant inventory, Wallace prepared and Arnold approved a statement which read: "...although Metropolitan Edison is concerned about the issue, there is no indication that this procedure or the history of the PORV discharge line temperatures delayed recognition that the PORV had stuck open during the course of the accident."

Response to NOV, at 34.

NRC Reports -

Between 1979 and 1984, three separate divisions of the NRC --

the Office of Inspections and Enforcement, the Office of Nuclear Reactor Regulation, and the Office of Investigations -- investigated l

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the response to the Notice of Violation, and produced four major reports concerning the statement made by Mssrs. Arnold and Wa llace in the response to the NOV, and at issue in this proceeding.

I The four NRC reports are:

1. Office of Inspection and Enforcement, Letter dated January 23, 1980, to Metropolitan. Edison Company. ("I&E Report")

2. Office of Nuclear Reactor Regulation, GPU v. B&W Lawsuit Review and its Effect on TMI-1, NUREG-1020 LD. ("NRR Report")

3. Office of Investigations Report on the Keaten Report Investigation, released June 15, 1984. ("01 Report")

4. Office of Nuclear Reactor Regulation, An Evaluation of the Licensee's Management Integrity as It Affects Restart of three Mile Island Nuclear Station Unit 1 Docket 50-289, NUREG-0680 Supplement No. 5 ("NRC Staff Report")

The Commonwealth need not restate all the detailed findings of the

, re po rts . The overall conclusions of these reports are consistent.

The I&E Report, the first NRC response to the Arnold /Wallace statement concludes: "There is a clear indication that recognition of an open PORV was delayed in part by the past history of the discharge line temperature in that the Emergency Procedure had not l

been implemented." I&E Report, Appendix A at 12.

The Office of Investigations initiated an investigation at the request of the Office of Nuclear Reactor Regulation. The Office of ,

Nuclear Reactor Regulation had reviewed trial records f rom the GPU

v. B&W lawsuit, and was disturbed by the evidence introduced in that case. See Report of the Review of the Babcock and Wilcox -

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General Public Utilities Lawsuit Trial Record Review, March 28, i

1983. The matter was referred by the Commission to the Office of I Investigations for further review. Af ter several months of investigation, the Office of Investigations released its report, which plainly states:

"The investigation determined that Met Ed's statement in their response to the NOV: '...there is no indication that this procedure or the history of PORV discharge line temperatures delayed recognition that the PORV had stuck open during the course of the accident,' was contrary to information (i.e., internal reports and operator interviews) in the possession of the corporate individual who draf ted the response [Wallace] and was contrary to the conclusions in internal reports written for or provided to the corporate officer who signed the response [ Arnold)."

01 Report at 3.

On April 18, 1983, the NRC Staff informed the Commission that it was reevaluating its earlier position on management integrity because of the release of new information that cast doubt on the licensee's character. The NRC Staff Report , issued in July,1984, considered all information adduced to date on the response to the NOV, and concludes:

"The staff concludes that the licensee did willfully violate the pertinent emergency procedure and that statements were made by the licensee [ Arnold and aW llace] in its response to the NOV that were neither accurate nor complete and were contrary to other information in possession of the licensee."

NRC Staff Report, at 8-19.

t If any of the divisions of the NRC had been in possession of

. Information that would contradict any of the earlier findings, it had an obligation to disclose this new information. During the

course of the Commission's proceedings concerning TML-1 restart, no new information was disclosed.

It appears that on the basis of such uncontested and remarkably consistent findings by three separate divisions of the NRC, the Commissic.;, on February 25, 1985, decided that: "There are no f actual controversies regarding licensee's response to the NOV. It appears that licensee made material false statements in its response, but the two individuals primarily responsible (Arnold and Wallace) are no longer associated with TMI-1." CLI-85-2, at 82.

The Present Proceeding On March 27, 1985, Mssrs. Arnold and Wallace wrote to the Commission, requesting a separate hearing on the question of "whether the adverse implications about the undersigned's management 4

integrity are factually substantiated. As a result of that letter, the Commission issued an order, CLI-85-19, on December 19, 1985, and established this proceeding. The December 19, 1985 order raises a number of questions concerning the scope and nature of this proceeding.

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! The Commission's December 19, 1985 order suggests that it is establishing this special proceeding to hear the special claims of r Mssrs." Arnold and Wallace, presumably because they did not have an adjudicatory hearing in the course of the restart proceeding. Yet, Mssrs. Arnold and Wallace's request is that the Commission

4 adjudicate issues which have a potential " constraint on [their]

utilization for activities regulated by the Commission." C LI-85-19, 1

at 2. The Arnold /Wallace petition is therefore a request for an i

l advisory opinion from the Commission on undefined future activity j rather than for a formal adjudication.

1 It appears that this special proceeding is not authorized under I

any of the Rules of the Commission. Under 10 CFR Part 2, rules are i

promulgated to conduct proceedings for the issuance, amendment, transfer of a license, for imposing requirments by order, for the i modification, suspension, or revocation of license, and for the ,

issuance of operating licenses. The Arnold /Wallace petition for hearing does not cite any rule under which this proceeding is to be

. conducted.*

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Furthermore , there has been no request f rom the licensee to return Mssrs. Arnold and W a llace to responsible positions at TMI-1 pending before the Commission. The Commission's February 25, 1985 order explicitly requires the " licensee to notify the Commission before returning either of these indviduals to responsible positions

, at TMI-1." CLI-85-2, at 64. The licensee, GPU Nuclear Corp., has made no such notification. The Commission's proposal to modify r

• Under 10 CFR 2.200, Mssrs. Arnold and Wallace are entitled to file i a request to modify a licensee condition or for "other action as may be proper" by filing a request with the NRC Staf f. It does not appear that the Arnold /Wallace petition constitutes such a petition. It also appears that the petition was not served on the parties to the TMI-1 restart proceeding when it was flied on March 27, 1983.

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the notificabion requirement is inconsistent with the terms of its February 25,1985 order.

The Arnold /Wallace petition for hearing challenges the '

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l conclusions . reached by the Office of Inspection and Enforcement, the

! Office of Nuclear Reactor Regulation, the Office of Investigations, the NRC Staf f, and the Commission itself. In essence it constitutes a request to reopen the record of the restart proceeding.

Before embarking on a hearing at the request of Mssrs. Arnold and Wallace, the Commission should apply the traditional standards for reopening a record. These standards, as the Commission articulated in its February 25, 1985 order (CLI-85-2, at 2), are:

(1) is the motion timely; (2) does it address significant safety (or environmental) issues; and (3) might a different result have been i

f reached had the newly proffered material been considered initially.

The Arnold /Wallace petition does not address these three standards.

l The Commission's December 19, 1985 order does not address any of i

these standards.

Since the Commission had made a determination in its February

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25, 1985 order that the statement in the response to the NOV was a material false statement and that Mssrs. Arnold and Wallace were j

j responsible for the statement, it is problematic that the Commission can now ask: is there "information which could form a reasonable basis for concluding that either Wallace or Arnold willfully, I

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L knowingly, or with reckless disregard for the truth made a material false statement to the NRC7" CLI-85-19, at 5. It would appear that

, Masts. Arnold and Wallace are collaterally estopped from challenging

that finding.

At the time of issuance of each of the NRC reports cited above, during the period from January,1980 through July,1984, neither Arnold nor Wallace challenged the accuracy or the basis of the NRC findings. Both Arnold and Wallace had the opportunity to intervene in the NRC proceeding on TMI-1 restart and the opportunity to offer comments as private citizens if they believed that the Commission's reports were erroneous.* If they had any information which supported their statement, it was their duty to bring it to the attention of the Commission in a timely manner. The Commission has not addressed t

the issue of timeliness.

A~ petition under 10 CFR 2.206 might be an alternative method of dealing with the issues. If such a petition had been filed by Mssrs. Arnold and Wallace, a decision by the Director of the Office of Nuclear Reactor Regulation would have issued. Then there would i have been a record for the Commission and other parties to review.

Because no record has been developed on the Arnold /Wallace petition, j

• Sec~ tion 189(a) of tha Atomic Energy Act, 42 U.S.C. 2239(a),

offers to "any person who may be affected" by an NRC proceeding the right to participate in the proceeding. Under 10 CFR 2.714, Mssrs.

Arnold and Wallace could have intervened in the restart proceeding.

Mssrs. Arnold and W a llace could have flied comments at appropriate points in the proceeding. The Commission accepted comments f rom the affected TMI-2 operators throughout the restart proceeding.

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this proceeding raises procedural and technical problems.

The Arnold /Wallace petition purportedly raises many issues of fact concerning the response to the NOV. The answers to these factual questions, however, are not within the realm of knowledge of any of the parties, other than the NRC and the relevant witnesses.

In orde.r for any party to comment on any factual issue, therefore, it is necessary to have the relevant NRC offices' comments on the Arnold /Wallace petition. Without such comments, it is impossible to know what facts are genuinely in dispute. In addition, having issued authoritative reports on the matter, on whic,h the Commission relied in preparing the February 25, 1985 order, it is the responsibility of the relevant NRC offices to respond to the petition.

2 Had a proper petition been filed under 10 CFR 2.206, these matters would have been addressed and interested parties would have been in a position to comment on the issues. However, the Commonwealth cannot offer additional facts at this point in the proceeding, since the Commonwealth has no independent means of obtaining information on the facts in dispute. Therefore, it is premature for the Commission to request outside parties to comment on this matter. ,

l Finally, the actions that the Commission proposes to take as

' the result of this proceeding are inappropriate. On the one hand, i

if the Commission determines that the evidence supports a finding i

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s that there is a reasonable basis for concluding that either Arnold or Wallace did make a material false statement, the Commission will consider initiating an adjudicatory proceeding to determine whether to retain the notification requirement in CLI-85-2. On the other hand, if no such finding can be made, then the notification requirement will simply be lif ted without any hearing.

The notification requirement was the result of rigorous hearings and investigations conducted by the Commission. Removal of that requirement, if appropriate , should be subject to the same degree of care. .

Moreover, the Commission's proposed resolution of this proceeding creates a double standard. It gives the petitioners the opportunity to have an adjudication to protect their interests, but does not offer the other interested parties the same opportunity to address their concerns. If a hearing is proper to determine if the notification requirement should be retained, it should be held regardless of the results of this "special" proceeding. This is particularly true since the Commission has already found, in the context of the restart proceeding, that the false statement were made, and that the petitioners were responsible for them.

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I 4 P Conclusion The Commission's order of December 19, 1985 (CLI-85-19) was issued in response to a petition which is not recognized by the Commission's own rules, is inconsistent with the Commission's the February 25, 1985 order (CLI-85-2), and addresses facts which the Commission has already resolved.

Moreover, it la not possible for the Commonwealth to submit information or comment on the questions as presented by the Commission in this proceeding until the position of the NRC Staff is disclosed , since the NRC Staff is the primary entity which has investigated the facts.

Finally, the alternatives proposed by the Commission for resolving this proceeding are inappropriate.

The Commonwealth therefore requests that the instant petition be dismissed, or alternatively, that a proper hearing be convened in order to afford the Commonwealth the opportunity to evaluate t

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and, if appropriate, respond to the facts submitted by the petitioners and the NRC.

Respectfully submitted, FOR THE COMMONWEALTH OF PENNSYLVANIA h.

'Ihomas Y. Au /

Assistant Counsel Barry M. Hartman Deputy General Counsel 505 Executive House P.O. Box 2357 Harrisburg, PA 17120 January 24, 1986 P

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