ML20203F413
| ML20203F413 | |
| Person / Time | |
|---|---|
| Site: | Comanche Peak  |
| Issue date: | 04/22/1986 |
| From: | Atomic Safety and Licensing Board Panel |
| To: | |
| References | |
| CON-#286-026, CON-#286-26 CPA, NUDOCS 8604250152 | |
| Download: ML20203F413 (83) | |
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l OR GINAL UNITED STATES O NUCLEAR REGULATORY COMMISSION '
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IN THE MATTER OF: DOCKET NO: 50-445-CPA CbMANCHEPEAKCONSTRUCTION PERMIT NO. CPPR-126 *- ~
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1 LOCATION: -DALLAS,' TEXAS PAGES: 1 ,82 3 ,
A DATE- TUESDAY, APRIL 22, 1986 .
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1 s UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION BEFORE THE ATOMIC SAFETY AND LICENSING BOARD
X In the Matter of: : Docket No.
- 50-445-(CPA)
TEXAS UTILITIES ELECTRIC COMPANY, :
et al., :
(Comanche Peak Steam Electric :
Station, Unit 1) :
X Downtown Hilton 1914 Commerce Street 4
Dallas, Texas O
Tuesday, 22 April 1986 The hearing in the above-entitled matter was convened at 9:00 a.m.,
BEFORE:
JUDGE PETEJ B. BLOCH, Chairman Atomic Safety and Licensing Board JUDGE KENNETH A. McCOLLOM, Member
() Atomic Safety and Licensing Board TATE REPORTING SERVICE, (713) 222-7177 L: j
2 JUDGE WALTER J. JORDAN b'
Atomic Safety and Licensing Board APPEARANCES:
On behalf of the Applicants:
ROBERT A. WOOLDRIDGE, Worsham, Forsythe, Sampels & Wooldridge, Thirty-Two Hundred 2001 Bryan Tower Dallas, Texas 75201 R. K. GAD, III, and THOMAS G. DIGNAN, JR.,
Ropes & Gray 225 Franklin Street Boston, Massachusetts 02110 NICHOLAS S. REYNOLDS Bishop, Liberman, Cook, Purcell & Reynolds 1200 Seventeenth Street, N.W.
Washington, D.C. 20046 On behalf of the Nuclear Regulatory Commission Staff:
() LAWRENCE CHANDLER, GARY MIZUNO, TATE REPORTING SERVICE, (713) 222-7177 L - -- _ _ _ . . . _ _ -_ _ ._ . - ~ . _ ,
7 3
Office of the Executive Legal Director United States Nuclear Regulatory Commission Washington, D. C. 20555 On behalf of the Intervenors:
JUANITA ELLIS, citizens Association for Sound Energy 1426 South Polk Dallas, Texas 75224
-AND-ANTHONY ROISMAN BILLIE GARDE, Trial Lawyers for Public Justice 2000 "P" Street N.W.
Washington, D.C. 20030 I
1 l
O TATE REPORTING SERVICE, (713) 222-7177 l
---~-0
4 1 PROCEEDINGS n/
N- 2 JUDGE BLOCH: Good morning. I'm Peter Bloch, 3 chairman of the Atomic Safety and Licensing Board, in the 4 matter of Texas Utilities Electric Company et al, Comanche 5 ' Peak Steam Electric Station, Unit 1, this is the 6 construction permit amendment case, 50-445.
7 This morning's hearing is a special prehearing 8 conference for the purpose of considering petitions to 9 intervene filed by Citizens Association for Sound Energy 10 and Meddie Gregory.
11 Before we begin, I'd appreciate it if the parties l'
12 would identify themselves for the record. Before we do 13 that, on my left, I am accompanied by Dr. Kenneth McCollom 14 and on my right by Dr. Walter Jordan. They are the other 15 two members of the Atomic Safety and Licensing Board.
16 MR. WOOLDRIDGE: Mr. Chairman, I'm Bob Wooldridge 17 for the applicant. Also present is Mr. Reynolds, 18 Mr. Dignan, Mr. Gad and Mr. Lustig (phonetic).
19 Mr. Dignan will be making the presentation for 20 the applicants on the construction permit matter.
21 JUDGE BLOCH: Thank you, Mr. Wooldridge.
22 MR. ROISMAN: Mr. Chairman, my name is Anthony 23 Roisman and with me is Miss Billie Garde, we represent
() 24 Meddie Gregory and next to Ms. Garde is Ms. Juanita Ellis 25 who represents C.A.S.E. 1 TATE REPORTING SERVICE, (713) 222-7177
5 l
1 For purposes of the argument this morning, I will 1 2 take the primary load for arguing the legal points on both 3 the Meddie Gregory and the C.A.S.E. petitions to intervene.
4 Although Ms. Ellis may supplement my statements with regard 5 to particular matters of detail, particularly related to 6 design questions that the Board may raise in the context of 7 that.
8 I would also like to request that the Board 9 accept by reference the filing of our notice of appearances 10 in the main operating license proceeding as notices of 11 appearances for this procaeding.
12 JUDGE BLOCH: Is there any objection to that?
O 13
\_/ MR. DIGNAN: No objection.
14 JUDGE BLOCH: Being none the motion is granted.
15 For the staff.
16 MR. CHANDLER: Mr. Chairman, my name is Lawrence 17 Chandler. With me is Mr. Gary Mizuno. We're with the 18 Office of the Executive Legal Director for the Nuclear 19 Regulatory Commission in Washington.
20 JUDGE BLOCH: Before we begin, I'd like to remark 21 that this Board is bound by the decision issued by the 22 Commission on March 13, 1986, memorandum and order, CLI 23 86-04, that decision refers specifically to standards set
() 24 forth in October 8, 1982 decision of the Commission CLI 25 82-29.
TATE REPORTING SERVICE, (713) 222-7177
6 1 And we remark that as we approach this argument 2 we are fairly much in accord with the interpretatica of 3 those decisions as set forth in permitee's answer to 4 petitions to intervene of Citizens Association for Sound 5 Energy and deddie Gregory. So that the principal questions 6 that the Board starts out concerned with today is the 7 question of what dilatory conduct is such that it might be 8 proper to deny an extension of a construction permit and 9 what the basis for a petitions may be within the meaning of 10 dilatory conduct.
11 In that regard, the particular contentions that 12 seem most borderline and most of concern are C.A.S.E. 6 and 13 Gregory 1. I'd like to ask that the parties restrict 14 themselves to 30 minutes per party. Unlike prior l 15 occasions, that will include the Board's questions.
16 I think it would be appropriate for petitioners 17 to begin first. I'll permit petitioners to reserve time 18 for rebuttal. If there's no objection I think they should i 19 be the only parties permitted to reserve rebuttal time.
20 To reserve the rebuttal time, you'll remark at 21 the end of your time that you have time left and how much 22 you're reserving for rebuttal.
23 Mr. Roisman.
24 MR. ROISMAN: Mr. Chairman, would you rather that s
25 we sit or stand?
TATE REPORTING SERVICE, (713) 222-7177
. 1 7
1 JUDGE BLOCH: I have.no preference.
2 ,. MR. ROISMAN: Then with your permission, I'll 3 sit.
4- Mr. Chairman, I think it's important to put into
.5- context the two petitions to intervene, and what about them 6 is so dramatically different than anything that has been 7 presented in the precedents that Applicants have cited and 8 staff has cited in their papers.
9 First, unlike any of the petitions that were 10 involved in the WPPS proceeding or in the Seabrook 11 proceeding, C.A.S.E. here is not asking that the extension 12 be denied. C.A.S.E. is asking that the extension be 13 granted only if certain conditions are met.
14 If the Applicants choose not to accept the 15 conditions then they will have made the decision to not 16- .take the extension. So we are not in a condition in which 17 many of the arguments of the Commission uses to justify why 18 one should not worry that an Applicant may have done some 19 wrong in the past, why that should not be of concern 12 0 because if they are not willing to be -- to get an 21 extension of time to correct the pro.blem, they'll be less 22 willing to come forward and admit that they have done 23 something wrong in the past. Our arguments do not depend
() 24 upon that.
25 Secondly, we are in this particular proceeding TATE REPORTING SERhICE, (713) 222-7177
8 j i
1 dealing with a situation in which unlike those proceedings, lT I
\J 2 the Applicants have not given us a statement of the reasons 4 3 for the delay. What the Applicants have done is given us a 4 statement of the reasons for the extension. And that is a 5 dramatically different situation than what was presented in 6 the WPPS case or in the Seabrook case.
7 Now, no one disagrees with what the operative 8 principals are in this case. The operative principals are 9 laid out in the Commission's decision in WPPS and in the 10 subsequent two appeal board orders and a licensing board 11 decision as well, and the Commission in seabrook having in 12 effect endorsed the appeal board approach.
sq k)m 13 JUDGE BLOCH: In WPPS, what was the reason for 14 the delay that was set forth?
15 MR. ROISMAN: The reason that was given for the 16 delay in WPPS and that was not prebed at all was that the 17 Applicants -- well, first of all, there was argument. The 18 Applicants claimed different reasons.
19 But in different WPPS opinions, you had in one 20 case the reason for the delay was alleged to be the 21 financial problems and the loads management problems, and 22 that's in WPPS at ALAB 771. And the set of issues there 23 were whether or not you could have a legitimate business
() 24 purpose when you said that you were delaying your plant 25 deliberately in order to accommodate the financing TATE REPORTING SERVICE, (713) 222-7177
9 1 limitations, need for power concerns.
i 2 And the intervenor there wanted to argue about 3 whether or not those financing considerations would ever 4 allow the plant to be built and whether or not the need for 5 power would ever justify having the plant at all.
6 And the appeal board in ALAB 771 following the 7 decision of the licensing board made clear that that was a 8 valid business purpose, that it was permissible for a 9 utility to say, "We've decided for business reasons that we 10 are not going to push ahead with this plant right,now," and 11 that wouldn't be identified as dilatory.
12 JUDGE BLOCH: Now in that case, if they had 13 business problems, weren't they in a sense of their own 14 making, bad projection of load, improper financing, that 15 kind of thing?
16 MR. ROISMAN: Well, that was one of the issues 17 that was debated and the Board decided to duck the issue.
18 The utility argued that it was Bonneville Power, who was 19 not an Applicant, whose independent actions were forcing 20 them to take these actions, rather than that they did it 21 themselves.
22 The intervenor argued the contrary and the appeal 23 board said, "It doesn't matter; doesn't matter whether it's
() 24 .done by your doing or by the doing of a third party, if it 25 turns out that it's a valid purpose that you had for the TATE REPORTING SERVICE, (713) 222-7177
10 1 delay." ,
2 JUDGE BLOCH: Weren't there also contentions in 3 WPPS that were excluded that the purpose -- the reason tct
-4 the delay was intentional violation of regulations?
5 MR..ROISMAN: That's in WPPS 722 and the 6 Commissions' decisions. And the issue in that proceeding 7- was the intervenors were arguing that the company's delay 8 had been caused by mismanagement and that therefore 9 because it was caused by mismanagement, they didn't have a 10 good cause for the delay.
11 We are arguing something importantly different 12 here. The Applicants have not said that the reason for 13 their delay is mismanagement. What the Applicants.have
-14 said is that they are engaged in a CPRT program and 15 process.
16 JUDGE BLOCH: Okay, but let's suppose the worst 17 face on it, suppose they said the reason for our. delay was 18 mismanagement. Wouldn't they still be entitled to an 19 extension of the permit?
20 MR. ROISMAN: Not necessarily, but they would at 21 least -- if they put forward that reason, then we can argue 22 about whether it is a valid purpose.
23 That's the standard that evolved in 722, that the
() 24 Commission endorsed in Seabrook. This two step process, 25 one -- the Applicant in effect has two ways to avoid the TATE REPORTING SERVICE, (713) 222-7177
11 1 pitfalls of asking for a good cause extension.
- k'3d 2 . Number one, if it proves that whatever caused 3 the delay wasn't its doing, design changes imposed by the 4 Commission, a labor strike, et cetera, all the factors that 5: are laid out in 50.55(b), that would mean the good cause 6 would be all right.
7 Now, there is a separate issue on the extension, 8 itself, but let's just look at the good cause for delay 9 question.
10 A second way that they can escape is to prove 11 that although they did it, they had a good purpose for 12 doing it. And in the words of the appeal board, "a valid 13 purpose."
14 Now, there is no Commission decision and there's 15 no appeal board decision that tells us precisely what is an 16 invalid purpose. But it's clear that it has to be a valid 17 business purpose and in fact --
18 JUDGE BLOCH: A valid purpose for continuing to 19 build the plant or a valid purpose for the original cause?
20 MR. ROISMAN: A valid purpose for the original 21 cause.
22 JUDGE BLOCH: How does that compare to the 23 statements that the only thing that is not a valid purpose
() 24 is if it's. dilatory?
25 MR. ROISMAN: Well, dilatory was then defined to TATE REPORTING SERVICE, (713) 222-7177
" i 12 1 mean "Did it deliberately without a valid purpose."
(~~\
\_J 2 In other words, " dilatory" was a word that the 3 appeal board struggled with in 722, rejected, essentially 4 two extreme positions that were put forward and took a 5 middle position. And the middle position was dilatory 6 involves a significant element of subjectivity.
7 We do go behind the Applicants' thinking process 8 to find out whether they have a valid purpose --
9 JUDGE BLOCH: The intention has to be, purposely 10 to be dilatory?
11 MR. ROISMAN: No, it has to be a nonvalid 12 business purpose. They don't define what that is. We 13 don't have a Board or Commission ruling that tells us what 14 would be an invalid business purpose. I'm not going to 15 argue to you that I have some case that says --
16 JUDGE BLOCH: Isn't there by exclusion, however, 17 the infatence that because they did say that proof that 18 they had purpo.ely violated the regulations would not 19 disprove, would not establish that it was dilatory, 20 doesn't the precedent stand for that?
21 MR. ROISMAN: No, I disagree with that. Let's 22 take a look at what the Commission had to say in CLI 82-29, 23 that's the WPPS decision. And in particular, at Page 1229.
(} 24 The Commission is addressing the question of what 25 an Applicant would establish. And starting -- I assume the i
TATE REPORTING SERVICE, (713) 222-71"7
13 1 Board, everybody has copies, it's a small docket of cases 2 here.
3 At 1229 in the sort of midway down, the first 4 full paragraph that begins on that page, it begins, "In 5 seeking an extension, a permit holder must put forth 6 reasons founded in fact that explain why the delay occurred 7 and those reasons must, as a matter of law, be sufficient 8 to sustain a finding of good cause. Moreover, the permit 9 holder cannot misrepresent those reasons upon which it 10 seeks to rely." And then it goes on from there.
11 Now, I submit that at this stage, based upon the 12 only pleading made by the Applicants, which is the letter 13 that was sent to Harold Denton requesting the extension on 14 the 29th of January --
15 JUDGE BLOCH: Before we finish with the 16 precedent, when I read that much of the precedent which you 17 directed my attention to earlier in your brief, I was with 18 you. And then I kept reading on 1230, and 1231.
19 MR. ROISMAN: All right.
20 JUDGE BLOCH: And especially the business about 21 violating regulations. Bottom of 1230.
22 MR. ROISMAN: Yes. All right. Now, all right.
23 Let me divert for a moment then to that point.
() 24 The point that the Commission is making there 25 goes to this and I said earlier that I would put it aside, i
TATE REPORTING SERVICE, (713) 222-7177
14 1 but let's talk about it now, that there is another piece to O f
\J 2 the request for an extension.
3 The first thing the Applicant has to do is to 4 show that there was good cause for the delay. And it's 5 this two pronged test and everybody, I think, concedes that 6 that has to be met.
7 The second thing that they must do, which the 8 appeal board recognized in its decision in ALAB 722 at Page 9 553, and also in the section that you're looking at now at 10 the bottom of 1230, is that there must also be a good cause 11 for the extension.
12 So, for instance, an Applicant that were to come 13 in and say, "Look we got delayed as a result of things that 14 were completely out of our control," that would meet the 15 good cause for delay.
16 Now, they have to identify why they need the 17 extension. What do you wanted to do with this extension?
18 That's a separate question. What the quote that you're 19 looking at on Page 1230 deals with --
20 JUDGE BLOCH: Where is the -- where is the 21 statement that they must justify what they want to do with 22 the extension other than just complete continue 23 constructing the plant.
() 24 MR. ROISMAN: Well, the Commission itself and the 25 part you're looking at on Page 1230 at the bottom of that TATE REPORTING SERVICE, (713) 222-7177
15 1 page says, still looking at the Commission's WPPS decision, l[x' ) 2 "If a permit holder were to construct portions of a 3 facility in violation of NRC regulations, when those 4 violations are detected and corrections ordered or 5 voluntarily undertaken, there is likely to be some delay in 6 the construction caused by the revisions. Nonetheless, 7 such delay as with delay caused by design changes must give 8 good cause for an extension."
9 Now, I submit that the clarification of that 10 statement is that if the utility were about to build the 11 plant in the extension period without complying with the 12 regulations, then the whole logic of this Commission 13 argument would be devoid of merit. There would be no 14 logic, you wouldn't give a company an extension of time in 15 order to build the plant improperly.
16 You couldn't have an extension that made the 17 prior violations legitimate good cause for delay, if what 18 you're going to do with the extension of time is perpetuate 19 the problem that caused the delay in the first place.
20 And the appeal board in ALAB 722 indicates at 21 Page 553, that when you're examining one of these issues, 22 and this is at the bottom of 553, moreover, even if a 23 properly framed contention leads to such a proceeding and
() 24 is proven true, the statute in implemen. ting regulations do 25 not erect an absolute bar to extending the permit. A TATE REPORTING dERVICE, (713) 222-7177
16 1 judgment must still be made as,to whether continued fm
's- 2 construction should nonetheless be allowed.
3 So there is a separate issue and it's that issue 4 that the Commission's referring to on Page 1230 of the WPPS 5 decision, the issue of whether even if you meet the good 6 cause requirement, you nonetheless are entitled to the 7 extension, do you have a good cause for the extension?
8 So it's two separate issucs.
9 Now, I submit in none of those cases, WPPS or 10 Seabrook, or in any of the other precedents that we are 11 aware of, did we have a situation which is admittedly 12 unique here: A utitlity who we believe has demonstrated on 13 the record that it does not intend to continue constructing 14 this plant in compliance with its original construction 15 permit or in compliance with the commission's regulatory 16 requirements.
17 JUDGE BLOCH: Weren't there similar allegations 18 made in the WPPS case?
19 MR. ROISMAN: No.
20 JUDGE BLOCH: There were no contentions in WPPS 21 that the continued construction would not comply with 22 Commission regulations?
23 MR. ROISMAN: The contention that was made in 24 WPPS was that the management was incompetent to be able to i( )
25 continue construction and on that basis it should be TATE REPORTING SERVICE, (713) 222-7177
17 1 denied.
O
\2 2 The contention that we're making is that the l l
3 management has stated its intent to not obey the 4 regulations and that the extension should be conditioned --
5 JUDGE BLOCH: To be clear, the management hasn't 6 stated its intent to not obey the regulation.
7 MR. ROISMAN: I'm sorry, although that's a matter 8 for us to prove, I believe we can prove --
9 ' JUDGE BLOCH: What you think --
10 MR. ROISMAN: -- that they have stated that.
11 JUDGE BLOCH: What you think is that what they 12 have stated they will do is in violation of the regulation.
13 There's nothing they've said that "We're going to flaunt 14 the regulations," right?
15 MR. ROISMAN: I believe they said they are going 16 to flaunt 10 CFR Part 50, Appendix B in this CPRT effort, 17 yes, I belive that that is what they said.
18 JUDGE BLOCH: Is that because --
19 MR. ROISMAN: They don't use the word " flaunt."
20 JUDGE BLOCH: It's not because they think that 21 they're flaunting it, it's because your interpretation of 22 what they are doing is that they're flaunting it.
23 MR. ROISMAN: Well, our contention is that they
() 24 are not going to comply with the regulation and that 25 nothing comparable has occurred. We don't have, in WPPS, a TATE REPORTING SERVICE, (713) 222-7177
v 18 i
1 1 utility that says, "We can progeed with a reinspection, b>
x- 2 redesign and reconstruction effort and not obey 10 CFR Part 3 50 Appendix B" and try to cite Diablo Canyon as their 4 excuse for --
l 5 JUDGE BLOCH: Why is it different to say that 6 there's-a specific plant that you think is not in
- 7 compliance with the regulations as opposed to arguing as 8 they wanted to argue in WPPS is that management is so 9 incompetant that they won't comply with regulation?
l 10 MR. ROISMAN: I think the difference is that the 11 Commission in the WPPS case is looking at and up or down l
l 12 vote: "Will we give the utility the opportunity to prove 13 that it can build this plant properly or will we not?"
i 14 And if they don't give them the opportunity, then 15 the issue is dead. We are not asking for that here. We're 16 asking that this utility's record demonstrates that you 17 should condition the extension by imposing the kind of 18 limitations with the Commission, itself, in Cincinnati Gas 19 & Electric imposed and which the staff itself imposed in 20 Midland; that one should take charge, in effect put Texas 21 Utilities into a regulatory receivership based upon the l
22 record that is now available --
l 23 JUDGE BLOCH: Were the staff conditions in
() 24 Midland conditions on an extension of an amendment --
25 MR. ROISMAN: No, no. Neither were extensions TATE REPORTING SERVICE, (713) 222-7177 l.__._
19 1 of an amendment question. The, point is that it's to f ~g k_l 2 demonstrate that those kinds of conditions are certainly 3 well within the ambit of the Commission to impose when 4 justified.
l 5 JUDGE BLOCH: Would they be within the ambit of 6 the licensing board in the operating license case?
7 MR. ROISMAN: That's a question very good 8 question. The Applicant appears to concedo yes. We have 9 not had a chance to evaluate thoroughly that statement by 10 the Applicant. And I would direct your attention to the 11 Applicants' pleading on Page S.
12 On Page 5, this is in response to the C.A.S.E.
} 13 Contention No. 4. The Applicants say, "The first theory, a 14 lack of reasonable assurance, is being litigated in the 15 ongoing licensing proceeding and thus is not a candidate 16 for separate litigation herein."
17 We have -- we have operated on the assumption, 18 neither conceding nor contesting that in the operating 19 license proceeding we're not permitted to argue whether or 20 not a continued construction activity was or was not in 21 compliance with the regulations and seek from the Board a 22 stop work order; that our remedy in the operating license i
I 23 proceedings was to let the process work its way to a
(} 24 conclusion at which time we would do as Ms. Ellis did in 25 1983, demonstrate that its conclusion produced an TATE REPORTING SERVICE, (713) 222-7177 l
20 1 indeterminate plant. .
O, J 2 JUDGE BLOCH: If there were a right in the 3 Licensing Board for a stop work order, would it be the 4 usual criteria for a stay that we'd be looking at?
5 MR. ROISMAN: No, I don't think so. Although I 6 suspect that you might -- you might argue many of the same 7 points. You would not be faced with a stay issue.
8 The Commission's authority under -- well, 10 CFR 9 Part 50, Section -- I think it's 50.100, and is the 10 concomitant authority under Section 186 of the Atomic 11 Energy Act which says, "Any time you learn of something 12 which if you'd known of it originally would justify you in g3
\_/ 13 stopping it," is not a stay standard.
14 It's a standard that the Staff has exercised as 15 it did in Midland and the Commission has exercised as it 16 did in Cincinnati Gas & Electric that does not have to go 17 through the traditional stay tests.
18 The Commission, if it seeks to force the stop 19 immediately rather than allow the Applicant the right to 20 have a hearing before the stop is ordered, has to go one 21 additional step and talk about, you know, emergency and the 22 immediate health effects et cetera as it did in Cincinnati 23 Gas & Electric in ordering a stop work.
(} 24 But again, I don't think the Commission has ever 25 operated on the assumption that the stay standard was the TATE REPORTING SERVICE, (713) 222-7177
21 1 right standard. .
[^/)
\_ 2 JUDGE BLOCH: Is it precedent for doing that in 3 en amendment extension case?
4 MR. ROISMAN: No. As far as we know, there's no 5 extension amendment case in which the question was raised 1
6 of imposing conditions on the proposed extension.
7 JUDGE BLOCH: So it's your position that it's an 8 initial impression question.
9 MR. ROISMAN: Yes. But I believe that it's clear 10 from the case law that what we have is a situation in which 11 there are two separate sets of questions to answer in an 12 extension proceeding; one, good cause for the delay and
]
\-
m 13 second, good cause for the extension.
14 And the issue of conditions arises in the context 15 of good cause for the extension. There cannot be a good 16 cause for an extension if the purpose for the extension is 17 not to obey the commission's regulations.
18 And if the Commission -- or in this case the 19 Licensing Board -- has reason to believe based upon 20 evidence presented by a party that the extension, when 21 given, will not result in compliance with the Commission's 22 regulations, then the extension is the time at which you 23 make that -- make that argument.
() 24 JUDGE BLOCH: Mr. Roisman, you have ten minutes.
25 MR. ROISMAN: Just to finish on this question of
. TATE REPORTING SERVICE, (713) 222-7177
22 1 the good -- of the use of conditions, the Licensing Board nN> 2 in the Midland proceeding, admittedly in the context of a 3 hearing on an order for modification of a construction 4 permit, did also without meeting the requirements of stay, 5 impose conditions on continued construction in the nature 6 of hold points.
7 And in that decision, the appeal board was 8 focused -- excuse me, the Licensing Board was fcv oing on 9 evidence'that it had before it that demonstrated evidence 10 we think substantially less powerful than what we could 11 present here that the Applicants were simply not willing to 12 abide by the Commission's regulatory requirements and that n
(_) 13 the hold points and staff supervision of each step of the 14 process was required in order to be sure that the 15 construction would proceed properly.
16 Now again, it's not an extension proceeding, and 17 on that it's a first impression question. But it again, 18 indicates the authority of the commission to impose such 19 conditions and, of course, the Board acting on behalf of 20 the Commission to do that.
21 I want to go back to the good cause for delay 22 again. I do not think it is merely a moot question to 23 expect the Applicants to produce their evidence and claim U
I'T 24 as to why the delay occurred and what the good cause was.
25 We have suggested that unlike any of these other TATE REPORTING SERVICE, (713) 222-7177
=
o 23 1 proceedings, this is not an Applicant who may be assumed to
(' have inadvertently stumbled on regulatory requirements and
- 2 3 then discovering their inadvertent mistake moved to correct 4 it.
5 There is a history, we've alleged it in our 6 contentions, of this utility being told that these very 7 things that it did that led it to violate the Commission's 8 regulations were wrong. Not in 1984 alone, not in 1983 9 alone, going all the way back to 1976, from the staff, from 10 outside auditors, from independant utility auditors like 11 NPO.
12 Now, we believe the Applicant at a minimum has a 13 duty to come forward and say on this record, "Why did this 14 delay occ;.?"
15 JUDGE BLOCH: The delay in responding to 16 information about problems in complying with regulations?
17 MR. ROISMAN: No, the delay in completing 18 construction properly. The delay is not caused by going 19 through the CPRT process. The delay is caused by the 20 violations of the regulations that necessitated that and 21 the question 4.s: "Why the delay?"
22 JUDGE BLOCH: I thought the unique point you were 23 making here was that the delay occurred after matters were
() 24 called to their attention and therefore, the delay in 25 complying is willful. Is that really the argument you're TATE REPORTING SERVICE, (713) 222-7177
24 1 making? .
{'D
\)
~ 2 MR. ROISMAN: I don't think there's any question l
3 that the delay in compliance is willful. But a willful, l 4 good business purpose would still get you out from under 5 the requirements for good cause for delay. But they've got 6 to do both things. They have to prove, we say, we allege 7 it was deliberate, and we say it was not for a valid 8 business purpose.
9 JUDGE BLOCH: What is your basis for saying that 10 it was deliberate that they didn't comply with regulations?
11 MR. ROISMAN: Because they were told by a number 12 of people what those regulatory requirements were, and (3
(_) 13 consistently failed to follow them. And the record will 14 show that.
15 So first, they have a burden here that they have 16 not met. Before we ever have to have a burden of proving 17 that their reasons given are wrong, they have to give the 18 reasons and their pleading does not give the reasons for 19 the delay. It gives the reasons for the extension.
20 With respect to the question of whether or not 21 there's an adequate time requested for the review, the 22 standard, the Commission standard is, would the time 23 requested frustrate the review?
() 24 And we have argued -- and they say, "Oh, you 25 haven't given us any basis for that." We've argued that if TATE REPORTING SERVICE, (713) 222-7177
25 i
1 you're going to continue to build this plant as improperly I
[\' 2 as you've been building it before, then three years is --
I i 3 now it's less than three, of course -- is not enough time 4 for the Staff, the Board and the parties to complete their 5 review. And thus, the utility, we have -- record is
, 6 replete with this, as we approach deadlines with this I
7 utility, we are all told " Hurry." We're all told to rush; 8 we rushed in the summer of 1984.
9 JUDGE BLOCH: So is your argument that you would 10 like them to have another year?
11 MR. ROISMAN: My argument is that if they're 12 going to do it this way, they're going to need at least i
O
(_- 13 five or six years because tFey're going to have to do it 14 all over again after you hold hearings and reject what 15 they've done up until now.
16 JUDGE BLOCH: If they ask for five years, would l
17 have you a problem? l 18 KR. ROISMAN: On this particular point, no. They 19 would have to give their reason for why they're asking for 20 five and I would hope that they would agree with mine, that l
21 since they're doing it wrong, they're going to have to take l l
22 longer to get it right.
l 23 On the question of the environmental issues, I
() 24 submit that the Seabrook case which is really the only r 25 that directly deals with is, involved an entirely diff cent TATE REPORTING SERVICE, (713) 222-7177
26 i
1 set of facts. .
(
'N' 2 We are here challenging the Staff's environmental 3 appraisal. That is part of the record of the request for 4 an extension. Under the National Environmental Policy Act, 5 we are entitled to that, in fact the Commission in the W2PS 6 decision in footnote 3, specifically reserves the question 7 of what does it mean when you have the environmental 1 8 impact?
9 In Seabrook, these issues were raised in the 10 context of good cause. We're not raising them in the 11 context of good cause. We are raising them in the context 12 of the National Environmentr.1 Policy Act. And none of the (O
_) 13 parties in opposing us have really contested that or 14 drawn -- come to issue with us on that.
15 What little time remains, which looks like it may 16 s tue three minutes, I'm going to reserve for rebuttal unless 17 you have further questions.
18 JUDGE BLOCH: No. Thank you, Mr. Roisman.
19 Second intervenor?
20 MR. ROISMAN: We're doing -- I was handling it 21 for all of us.t And unless you had some questions --
22 JUDGE BLOCH: I had thought that it would be 30 23 minutes petitioner or party. And so therefore if you want
() 24 to spend an additional ten or fifteen minutes, I'd have no 25 problem with that.
TATE REPORTING SERVICE, (713) 222-7177
27 1 MR. ROISMAN: Why don't I just reserve that for O
k- 2 rebuttal as well. I feel like your questions have helped 3 focus on what I think are the critical arguments that we 4 have to make. I'd like to -- I don't think the other 5 parties have addressed most of this because obviously we 6 filed the petition, not an argument for why it should be 7 admitted. So I'd rather reserve for rebuttal if that's all 8 right.
9 JUDGE BLOCH: Mr. Dignan?
10 MR. DIGNAN: Thank you, Mr. Chairman, members of 11 the Board.
12 I'd like to address at the beginning this point 13 that allegedly the Applicants gave no reason for the delay 14 in the original pleading.
15 MR. CHANDLER: Can you speak up, please?
16 MR. DIGNAN: -- in the original pleading. Is 17 this mike on?
18 MR. CHANDLER: Move it toward you, I think will 19 do it. l 20 MR. DIGNAN: It's not on. l 21 MR. DIGNAN: Is this one on?
l 22 In the letter of January 29, 1986, the Applicants 23 on the first page pointed out the physical construction of
(} 24 Comanche Peak, Unit 1 was essentially completed. And then 25 went on that major efforts to reinspect and reanalyze TATE REPORTING SERVICE, (713) 222-7177
+
s I
/ 28 l
1 various structures, systems and components had been ongoing f')
i \/ 2 since the fall 1984 in order to respond to the questions i
3 raised by the NRC staff's technical review team, by the 4 Board and parties in the ASLB operating license proceedings 5 and raised by other external sources.
6 TRT was formed by senior NRC management in March i 7 of '84 to consolidate and carry out various reviews 8 necessary for the Staff to reach its decision regarding 9 plant licensing.
10 Applicants formed the comanche Peak response team 11 and submitted a program plan to respond to the TRT's 12 questions, the ASLB issues and other external source (q
_) 13 issues.
14 That plan is presently being implemented. .It is 15 anticipated that such implementation will not be complete 16 for the second quarter of 1986.
17 over on Page 2, there was reference to the fact
- f. 18 that the delay has been necessitated by the performance of 19 the reinspections and reanalyses described above.
20 Obviously Applicants would not delay operation of Comanche f/ 21 Peak Unit 1 any longer than is necessary to demonstrate the 22 safety of the plant to their own satisfaction and that of 23 the NRC.
() 24 Now, I think in terms of just plain pleadin,g, 25 which I've heard a lot of argument about, the pleading TATE REPORTING SERVICE, (713) 222-7177
29 1 stands. Is it a model of brevity, perhaps, but I never p\/ 2 thought that was a sin in pleading.
3 JUDGE BLOCH: I think the problem on point of 4 view is that the intervenors believe that the cause for 5 delay is not just the things you're responding to, it must 6 have something to do with how it is that it's now necessary 7 to respond to all those things.
8 Did the Applicants have no part in creating the 9 conditions that are now being responded to? Did they just 10 arise upon spontaneously?
11 MR. DIGNAN; I think it's clear that anybody 12 who's constructing a nuclear power plant, your Honor, who h
[~/
x- 13 comes down to a point where construction is nearly 14 completed and the Staff finds problems, obviously 15 ultimately the constructor of that plant is responsiole for 16 the problems, no one else can be.
17 So in that sense, I think incorporated in this 18 statement is a statement that the delay is there because 19 things are wrong with the construction of the plant. And I 20 think that that pleading, as I say, while it may be a model 21 of brevity, I don't thing brevity is sin, but I think in f 22 terms of stating the prima facia case necessary to getting 23 the extension, does it.
() 24 And I'm not so sure that that isn't out of our 25 hands anyway because the extension has been granted. The TATE REPORTING SERVICE, (713) 222-7177
30 1 question now is whether a heari,ng should be held with the s
(~/
\g 2 view that this Board writing a decision that the extension 3 should be pulled back. So the prima facia case, I think, 4 was made in the pleading, as a matter of pleading and I 5 think that that point is fully responded to on that basis.
6 JUDGE BLOCH: Does the Staffs' decision have any 7 effect in this case?
8 MR. DIGNAN: The staff -- well, in the broad 9 sense of in this case, if you mean strictly the question of 10 whether the Board could write a decision and determine that 11 the permit should not be extended and therefore the 12 extension should be revoked, the Staff obviously cannot
( 13 bind the Board in that regard.
14 And the Commission makes clear that the only 15 issues it has decided is those that they specifically 16 decided and they only bound the Board to the extent they 17 stated in their decision and no further.
18 So when the Board find a contention that fits 19 within those permutations and combinations, if it holds a 20 hearing on that contention and it finds that the 21 petitioners are correct and the Board clearly has the power ,
l 22 to write a decision directing the NRR to pull the extension 23 or pull the permit. l
{} 24 JUDGE BLOCH: Would Intervenors' argument that l 25 Applicants were informed from a variety of sources a long TATE REPORTING SERVICE, (713) 222-7177
31 1 time ago that they were problems in the QA/QC program that
\~/ 2 now have caused this delay, would that be within the scope 3 of_the cause being set forth by Applicants?
4 MR. DIGNAN: I don't -- if it existed, perhaps it 5 would. The problem is that what is a lot of the argument 6 that I heard from my learned friend to my right here, was 7 an argument that might be well made assuming we had a 8 proceeding on the merits going.
9 The question is whether a contention that has 10 been put forth before you that has sufficient basis te get 11 into that. And as we responded in our brief on C.A.S.E.
12 No. 6 which is really as you indicated at the beginning is 13 maybe the closest shot, and Gregory No. 1, they are 14 alleging that it's all well and good to allege to get into 15 the framework of ALAB 722 and CLI 842 that the difficulties 16 with the result of management actions that were quote 17 " deliberate."
18 But I do not believe that just simply saying they l
19 deliberate gets you there, because if that be the case, 20 then you're essentially wiping out all of the language in 21 the original WPPS case that says it is always good cause 22 for delay if the purpose for the extension is to correct 23 deficiencies in the plant.
() 24 In other words, I think that it would have to be 25 alleged is that it may well be -- to take one of the TATE REPORTING SERVICE, (713) 222-7177
32 1 examples they gave -- it may well have been wrong to have 5-)- 2 continued to utilize a certain design, in hindsight; but 3 absent a showing of subjective knowledge by the top 4 management of a company to go forward with that design 5 knowing it was wrong, I don't think you've got deliberate 6 conduct as the Commission means it and certainly that 7 hasn't been pled and I don't know of anywhere in the record 8 it could be proved from that that was the case.
9 JUDGE BLOCH: What they have pled is that a 10 variaty of parties including the Licensing Board, pointed 11 out deficiencies in QA/QC for design, our decision was in 12 December of '83, and that with the knowledge that that had 13 occurred, the Applicants were very slow in responding to 14 that information to correct the QA/QC problems that were in 15 existance and that that intentional delay constitutes 16 dilatory conduct.
17 Is that adequate basis for an argument of 18 dilatory conduct?
- 19 MR. DIGNAN
- No, I don't believe it is, because 20 just saying that the delay was intentional doesn't get it 21 done.
22 Stating the conclusion doesn't make it over the 23 rail. What you've got to do is have some evidentiary basis
(} 24 pleaded in this pleading for the fact that a intentionial 25 decision was made, once the Board had spoken, to disregard TATE REPORTING SERVICE, (713) 222-7177
33 1 that. .
.-> 2 JUDGE BLOCH: By analogy to the doctrine of res 3 ipsa loquitur in tort law is it enough to go forward to 4 find out whether there is intentional conduct based on what 5 is being pled here?
6 MR. ROISMAN: Whether it is under res ipsa 7 loquitur under tort law, I don't think it is under the 8 Commission's regulations because the Commission regulations 9 require the contention to be stated and the evidentiary 10 basis for the contention to be stated and there simply is 11 none stated to my judgment.
12 MR. DIGNAN: Now, an argument was made to you 13 that you can not give an extension to build a plant 14 improperly. Assuming you were being asked, or anyone was
~15 being asked, to give an extension to build a plant 16 improperly, no one can disagree with that statement.
17 But you're never being asked to give an extension 18 to build a plant improperly. You're being asked for an 19 extension to build a plant. If aftcr that activity is 20 carried out, it was improper, it is the operating license 21 proceeding that will decide whether or not something 22 happens as a result of that.
23 The Commission or the Board or the Staff is never
(} 24 in the position of making the judgment as to what in the 25 future is going to happen. They either grant the extension TATE REPORTING SERVICE, (713) 222-7177
34 1 or they don't.
/~ To check on whether what was done under the k) x- 2 extension was correct is an operating license proceeding.
3 JUDGE BLOCH: Well perhaps, let me just ask --
4 the thrust of Intervenors' argument about conditioning the 5
grant of an extension had not occurred to me until today.
6 And the question arises in my mind as to under what 7 circumstances they could argue for a condition on an 3 extension. And I'm not sure we have any precedent on that.
's clearly, any condition imposed on an operating 10 license, for example, is a condition that affects future 11 behavior based on past behavior. Are there circumstances 12 under which it's also appropriate to condition an extention (D 13 x_/ of a construction permit based on past behavior and do we 14 have anything that speaks directly to that?
15 MR. DIGNAN: I am not -- I do not believe the 16 Board has jurisdiction to condition the extension. The 17 Board has jurisdiction to hear and decide that the 18 extension should not have been granted, but I do not belive l l
19 the uoard has the power to condition the extension.
l 20 JUDGE,BLOCH: That would not be true in any other I 21 kind of amendment case would it be -- in any other kind of 22 amendment case we'd have free jurisdiction to grant 23 conditions.
() 24 MR. DIGNAN: But what the Board there raises is 25 the fundamental distinction between these amendments, which TATE REPORTING SERVICE, (713) 222-7177
l 35 1 are for extensions, and all oth.er amendments. All other p>
i- 2 amendments change your rights under the permit. The only 3 thing.that is changed by the extension is the time.
4 JUDGE BLOCH: Okay, therefore the only conditions 5 that would be applicable would have something to do with 6 time which is the subject matter for the extention.
7 MR. DIGNAN: No, I don't think there are any 8 conditions put on in time, because the condition is put on 9 itself. You pick a last time and you've got to come back 10 again if you've weren't on it.
11 But more importantly, keep in mind it seems to me 12 that what you're being asked to do is through a back door 13 put a licensing Board in a position the Commission says it 14 cannot be in and that he is policing construction.
15 If you put a condition on a construction permit 16 of this nature, dealing with such things as how the 17 construction is going to be accomplished or the quality 18 assurance, you're putting a licensing board, which it so 19 happens, for example, in this case, is identical to the 20 present operating licensing board but that is a 21 happenstance, not a given, in the position of policing 22 construction.
23 And that, I think, the Commission has made clear
() 24 is not the function of its licensing boards or its 25 licensing boards' judges. That's the Staff's function.
TATE REPORTING SERVICE, (713) 222-7177
36 1
J 1 And if things go wrong under the permit, then it
- ~
\~ > 2 is up to the Staff under 2206 to bring things back into 3 line.
4 JUDGE BLOCH: Except, what, in Midland, there was 5 an exception there where there was a very strict condition 1
6 set on continuing construction? !
7 MR. DIGNAN: Set out by the Commission itself.
8 JUDGE JORDON: I don't quite understand what --
9 you say if we were to put on conditions, then it would be 10 up to the licensing board to see that they were obeyed. It 11 seems to me --
12 MR. DIGNAN: No, I am saying -- what I was 13 arguing, your Honor, is that I don't think the Board can 14 condition the construction permit. And I was saying if you 15 do allow the Board the jurisdiction to condition the 16 construction permit in the context of ein extension 17 proceeding, you're essentially doing by the back door what 18 cannot be done through the front door, which is to have an 19 operating license board policing construction.
20 JUDGE BLOCH: Then it would be possible for the 21 licensing board to put on a condition and then leave it up 22 to the Staff?
23 MR. DIGNAN: Well, if the condition -- however
() 24 that depends upon what kind -- one of the things, the 25 problems we have here is what is the condition is that's TATE REPORTING SERVICE, (713) 222-7177
37 1
1 being looked for. .
I) 5- 2 If the condition is "Thou shalt obey the l
3 regulations of the Commission," that condition is in the 4 permit anyway. And I don't know what more of a condition 5 is being asked for or can be put on, which seems to me to 6 raise a wholly nonquestion, if you will, because any 7 construction permit carries with it both in terms of the 8 regs themselves and by its nature, a commitment that you 9 will obey the regulations of the Commission and that's all 10 the Board can say in a condition, the kind of condition 11 we're looking for.
12 I think with -- given the Board's interest
(_.)
13 therein, that the one thing that has to be made clear in 14 this proceeding is where we are and what we're doing now.
15 We are not on the merits of an admitted contention. That's 16 all -- and I sincerely believe that most of the argument 17 I've heard from the petitioners so far assumes a contention 18 out there being argued and needs some evidence in the 19 record.
20 And I think in our brief we peinted out that in 21 all of these, I think the contentions as stated transgress 22 the principals in WPPS and the Seabrook case, and with 23 respect to the C.A.S.E No. 6, Gregory No. 1, for the
(} 24 reasons stated in there, the basis just hasn't made it. To 25 state the conclusion is not enough.
TATE REPORTING SERVICE, (713) 222-7177
38 1 And I believe that addresses essentially O
hy/ # 2 everything I wanted to address with respect to that.
3 JUDGE BLOCH: I guess C.A.S.E is going to argue 4
that within C.A.S.E. No. 6 there is a statement of basis.
5 And you're feeling is that it's not.
6 MR. DIGNAN: Yes. As we said in our brief, we 7 fully understand what the attempt, the attempt that was 8 made in C.A.S.E. No. 6 and Gregory 1 and that is to make a 9 statement to come in within the ambit of the definition of 10 dilatory.
11 But as we stated there, simply stating that 12 permitees acted deliberately in violating the regulations
( 13 does not supply the necessary substantive basis for the i 14 charge; it is to state the conclusion.
15 JUDGE BLOCH: What about the last paragraph, 16 which is set forth on your Page 7. They state, "In the 17 face of warnings by independent auditors," I think people 18 in the operating license case know of some of those 19 warnings, "the NRC," I take it that's TRT findings 20 primarily, "and the Atomic Safety and Licensing Boards,"
21 that must be primarily our decision of December '83. Now, 22 if -- is it legitimate to infer that those are the 23 references being made and do those provide basis?
() 24 MR. DIGNAN: I'm sorry, I was distracted.
25 JUDGE BLOCH: Okay. I just suggested what comes TATE REPORTING SERVICE, (713) 222-7177
,..y,, y.-. , _ _ , , , - - - - , .-, --- ,, . - _ . -,- _ _ . . - ~ - -
39 1 to my mind when I see that sentence, first is it ligimate r"{
'g/ 2 for the purposes of basis for us to make that kind of 3 inference; and second, if we do make that kind of 4 inference, is there enough of basis for the contention in 5 that last paragraph?
6 MR. DIGNAN: I don't think the -- I don't think 7 that -- whether it is proper for you to make the inference 8 in the case of a given individual is one thing. But the 9 inference that I don't think you can make is what I said 10 earlier. It may be wrong to have continued to go forward 11 in the face of these warnings in certain directions, 12 assuming that was done.
( 13 But absent a pleading and finally approving a 14 showing of a subjective knowledge that this was erroneous 15 on the part of the Applicant, I don't think you have the 16 deliberate conduct the Commission was looking for.
17 JUDGE BLOCH: As the basis states, they're 18 arguing that in the face of these criticisms, Applicants 19 refused to change their QA/QC implementation or address and 20 correct design deficiencies. I take it their talking about 21 at least a lag from 1983 until CPRT was formed.
22 MR. DIGNAN: Whether that lag was too long in 23 light of all of the things that were going on may be
(} 24 something to argue about. But the problem is I don't think 25 there is any pleading and there cannot be any proof that TATE REPORTING SERVICE, (713) 222-7177
40 1 the purpose of doing this was to delay. And that is the
/)
k /
3 2 key to the Commission's standard.
3 JUDGE BLOCH: Is it similar to the problem you 4 have when you've got a dead body in a murder, that you l
5 infer intent by examination of the objective facts? !
l 6 MR. DIGNAN: I don't think you can do that. When i
7 you've got a dead body, you've got something that I think 8 most human beings would agree somebody might want that body l
9 dead and that was bad. !
10 It is very hard for me to infer an intent on a 11 management of a utility that there's some benefit to it in 12 any way of delaying the proper construction of a nuclear
() 13 power plant and getting it on line. That's a pretty far 14 inference and a much different case than the dead body.
15 JUDGE BLOCH: Let's see, to do otherwise might be 16 to admit a lack of prudence, then? In other words, a 17 problem here is at-the pleadings stage in what is basically 18 a civil case, is there enough now to allow discovery as to 19 what the actual intent was?
20 MR. DIGNAN: No, it's not a question of whether 21 there's enough to allow discovery because you don't get 22 discovery to see if you've got a good intention. What 23 there is: "Is there enough here to state a good intention
(} 24 and an evidentiary basis within the WPPS rule?"
25 JUDGE BLOCH: A basis for inquiring into whether TATE REPORTING SERVICE, (713) 222-7177
l 41 s
1 there was an intent to be dila, tory?
, 2 MR. McCOLLOM: There's too much noise over here.
3 I can't hear.
4 JUDGE BLOCH: What was it you asked?
5 MR. McCOLLOM: I'm not sure.
6 JUDGE BLOCH: Off the record.
7 (A discussion was held off the record 8 and the last-above statement by Mr. Dignan 9 was read back by the reporter.)
10 JUDGE BLOCH: Could you refresh my memory as to 11 what the basis was within WPPS to-allow the admission of i
12 the contention?
13 MR. DIGNAN: There was none ever admitted except 14 there was one sent back and what we pointed out in our 15 brief they sent it back for admission on the assumption .
16 that there would be -- it was the first contention. It 17 wasn't the one that parallels C.A.S.E. No. 6; it was the 18 contention that is similar to C.A.S.E. No. 1. "The delay 19 was caused by factors totally in control of the Applicants 20 and thus the requirements of 10 CFR 50.55 have not be met 21 and the request should be denied."
22 We stated in our brief that that was essentially 23 identical to the one in WPPS that was sent back to the
() 24 Licensing Board to see if it could be particularized.
25 C.A.S.E. elected not to particularize that one at all.
TATE REPORTING SERVICE, (713) 222-7177
42 1 JUDGE BLOCH: Okay. ,Possibly 6 is a C'
5 3- 2 particularization of 1. I don't know. But what was the 3 particularization attempted in the WPPS case on remand?
4 MR. DIGNAN: I don't know that anyone -- any was.
5 You can't discern from the decisions what was attempted.
6 JUDGE BLOCH: So was their -- was the decision 7 that there was no sufficient particularization?
8 MR. DIGNAN: No, there wasn't a decision to that, 9 no, because they fought it out and it came back up, as I 10 understand it. But what I'm saying is --
11 JUDGE BLOCH: If it came back up, somehow-they 12 provided a basis. There's no decision stating what the 13 basis was?
14 MR. DIGNAN: Not that I'm aware of.
15 JUDGE BLOCH: Well, if there is, could any of the 16 parties would furnish it to us?
17 MR. DIGNAN: There's a Licensing Board decision 18 on summary judgment, I'm told, in that case.
19 MR. ROISMAN: Mr. Chairman, I think the history 20 of WPPS is not being altogether made clear here. The 21 Commission's decision precedes 722. 722 dealt with only --
22 MR. DIGNAN: Your Honor, may I respectfully raise 23 a point of order?
24 MR. ROISMAN: I thought you asked the parties to
( ')
25 tell you and I was merely doing that.
TATE REPORTING SERVICE, (713) 222-7177
E i I
43 1 JUDGE BLOCH: I think Mr. Roisman was responding O
\v 2 in cooperative spirit. But since we're --
3 MR. ROISMAN: I didn't want to argue but I just 4 wanted to say just this one thing. If you look at the 5 titles of the case, you'll see some are called WPPS No. 1, 6 some or called WPPS No. 2 and some are called WPPS No. 1 7 and 2.
8 So in trying to figure out what is the history.of 9 the particular things, you have to follow the numbers.
- 10. MR. DIGNAN: In the decision, the ALAB 722, which 11 is the case on the way back up, it is referred to as the 12 Licensing Board Rule that it was not, i.e., that it wasn't
( .
13 sufficiently particularized, and hence denien the 14 coalition's petition for intervention. And the order was 15 unpublished.
16 So according to the appeal board what the 17 Licensing Board did in an unpublished order is hold there 18 was insufficient particularization, in an unpublished 19 order. This is on Page 548, 17 NRC, in the decision that 20 begins on 546.
21 JUDGE BLOCH: So we really have know precedent on 22 what is sufficient particularization at all.
23 MR. DIGNAN: We don't, but in the indication of i
() 24 case No. 1 there is no particularization, that is clear to 25 me.
s TATE REPORTING SERVICE, (713) 222-7177
A . - 1 -.-4 - - - a .p _.
l l
44 1 That completes my argument.
O 2 JUDGE BLOCH: Thank you. So let's see. Let's 3 just-keep track here. No, yca're not saving any time for 4 rebuttal, because we didn't permit that.
5 Mr. Chandler.
6 Wait, we're going take a ten minute recess. We 7 will resume at 11:01. I have 10:51 right now. I mean 1
8 9:51, we'll resume at 10:51.
9 9:51, we'll resume at 10:01.
, 10 (Recess. )
11 JUDGE BLOCH: Okay, we'll come to order.
12 MR. CHANDLER: Thank you, Mr. Chairman. I think
) 13 just a few of the points raised by Mr. Roisman this morning 14 and a couple of questions raised by the Board require some 4
15 response in addition to the reply that the Staff filed last 16 week.
17 The Staff would disagree with the suggestion that 18 Mr. Roisman makes, that good cause must be shown on two i
19 fronts, namely a good cause for an extension, in addition 20 to the requirement that good cause be shown for the delay 21 in construction.
, 22 I think the Commission's regulations and the 23 words Mr. Roisman cited, simply are shorthand ways the
(} 24 Commission having express the requirements that good cause 25 be established for the extension that has been requested.
TATE Rf; PORTING SERVICE, (713) 222-7177
45 1
I don't think the Commission intended that there be a two i
[f s 2 pronged -- an additional two pronged demonstration made by 3 an applicant for construction permit extension, one for 4 good cause for the delay that was encountered in the past 5 and another good cause for the extension granted.
6 As Applicants counsel has pointed out, we're here 7 today talking about contentions. Contentions must 8 fundamentally meet the commission's regulations in 2.714B, 9 they must be set forth with adequate basis and specificity.
10 And in addition, they must be within the scope of 11 matters properly litigated in a construction permit 12 extension proceeding, and that we've all recognized our
( 13 standards which have been laid out in several of the WPPS 14 decisions in addition the Commission seabrook decision.
15 The contentions that have been put forward here 16 by both C.A.S.E. and Meddie Gregory fail simply to meet 17 both of those requirements, set forth without adequate 18 basis and specificity in most instances, and/or they simply 19 go beyond the issues which are properly considered in the 20 context of this type of a proceeding.
21 Contention 6 -- C.A.S.E. Contention 6, Gregory 22 Contention 1, cleraly comes closest, but again, to the 23 extent it does suggest an issue challenging the good cause 24 shown by the Applicants for the delay encountered, there's
(}
25 no basis provided.
TATE REPORTING SERVICE, (713) 222-7177
46 1 Something more than simply inference I think is A> 2 necessary. Because an inference, that is something that's 3 left to the sui,ective interpratation of the reader.
4 The --
5 JUDGE BLOCH: I don't understand. That's the 6 case with all evidence, isn't it?
7 MR. CHANDLER: hu. I think if one looks to the 8 the basis requirement that the Commission has intended by 9 its regulations, something more than an inference is called 10 for.
11 JUDGE BLOCH: So you have to start the case with 12 definite proof?
13 MR. CHANDLER: No, absolutely not. I certainly 4
14 wouldn't suggest that. There are cases which certainly 15 suggest that there's a much lower threshhold at the 16 contention pleadings stage than coming 'orward with proof 17 of an issue. Clearly that's not the question here, is not 18 a merits question at all.
19 It's a question of whether there's enough 20 information put forward in the contention itself, to 21 warrant reasonable minds to inquire further. !
22 And I don't think these contentions have met even l 23 that threshold.
l 24 We have C.A.S.E.'s assertion that the record is
( }) i 25 replete with showings that the Applicants have willfully :
1 TATE REPORTING SERVICE, (713) 222-7177
47 1 failed to take certain activity -- certain actions to b
Ns- 2 promptly correct defficiencies that have been brought to 3 their attention over a period of time.
4 The Board I think used the word slow in correcting 5 deficiencies. That's very different, I believe, than 6 taking what the Staff would perceive to be a quantum leap 7 to the next prong of the Commission's test here, that is 8 that the Applicants have intentionally delayed construction 9 without a valid purpose.
10 I certainly suggest the record shows,'perhaps, the 11 Applicants' judgment and approach to resolving issues 12 haven't been always prudent. And may not have always been
. 13 taken in the most expeditious manner.
14 But that's a far cry from taking the next step and 15 suggesting that the Applicants' activity was intentional 16 without a valid purpose.
17 JUDGE BLOCH: In the summer of '83 the Board said 18 there was no quality assurance for design, no effective 19 quality assurance for design. And it took until August of 20 '83 to launch the -- August of '85 to launch the CPRT 21 effort. Would there be a basis for inquiring further as to 22 the motivat ie 'or that delay?
23 Mh .JLER: If we wish to what-if and suggest
() 24 that there - whole void between period of December '83 25 and the Auguss of 1985, perhaps you may be in a different TATE REPORTING SERVICE, (713) 222-7177
---w-, - - , e -
-e
48 1 footing than you are right now,
\_) -2 But I think the record doesn't show that. There 3 are numerous instances I believe on the record of efforts, 4 I think shortly after the Board's decision 1983 memorandum, 5 the Applicant put forward a proposal to address the Board's 6 concerns, to show that perhaps the Board's concerns were 7 ill-founded at that point in time. And that was followed 8 then by a second, a second attempt to remedy the -- or to 9 address the Board's concerns.
10 Niether of those, in our view, show that the
'lh Applicant was dilatory. They started and perhaps 12 improvidently as events have turned out, to procaad down 13 certain courses to establish that the facility has been 14 designed and constructed in accordance with the 15 Commission's regulations and in accordance with its 16 construction permit.
17 It obviously hasn't suceeded in doing so yet.
18 But it has taken conduct which the Staff considers to be 19 reasonable in the circumstances and in an effort to satisfy 20 the concerns that have been expressed by the Board, by the 21 Staff, and other external sources, to meet the requirements 22 necessary to obtain an operating license. Certainly not 23 evidence of dilatory conduct.
(} 24 JUDGE BLOCH: Is it fair to say that in December 25 of '83, if there was no effective QA program for design, TATE REPORTING SERVICE, (713) 222-7177
49 1 that Applicants are charged with knowledge of that as of eT km ), 2 December of '83?
3 MR. CHANDLER: Yes.
4 JUDGE BLOCH: What was keeping them from 5 knowing --
6 MR. CHANDLER: Yes, that's right. If there had 7 been such a wide spcead determination made and an absolute 8 failure by the Applicants to recognize the problem and take 9 measures to address the problem, as I suggest, we may well 10 be in a different footing than we are today.
11 JUDGE BLOCH: Does the Staff know why it took 12 from December '83 to August of '85 to begin addressing that
(~T
(_/ 13 problem in a serious way; or were there serious ways of 14 addressing it before that?
15 MR. CHANDLER: I think -- I can't speak for the 16 Applicants. I certainly took seriously the Applicants' 17 efforts in starting I believe in the January time frame, to 18 address the types of problems raised by the Board, for 19 example in its December 1983 memorandum. They are --
20 JUDGE BLOCH: Are you familiar with the filing 21 that was made on QA for design; do you consider that to be 22 a thoughtful presentation of the facts as they were known 23 to the Applicants at that time?
24 MR. CHANDLER: Mr. Chairman, in all honesty, I'm
(}
25 only familiar with it in passing. And I'm not willing to TATE REPORTING SERVICE, (713) 222-7177
50 1 characterize it as serious or not. I have to assume that n)
(
's 2 if the Applicants put forward a filing before a Board, a 3 tribunal of this agency, that they have put forward a 4 serious effort.
5 I'm not going to sit here today and second guess 6 what they did some several years ago, certainly, based on 7 my only passing familiarity with what transpired at that 8 point in time in this case.
9 But sitting here today, I would have to expect 10 that it was a serious effort on their part to come to grips 11 with issues and, in hindsight, we have to concede, maybe 12 ill-advised; maybe the wrong course of action was taken at 13 that point in time.
14 JUDGE BLOCH: My problem is that --
15 MR. CHANDLER: But it wasn't intentional, that's 16 the focus.
17 JUDGE BLOCH: If we assume that they knew the 18 program was deficient and it took them a year and a half to 19 begin to taking serious steps to inquire into the 20 consequences of that deficiency, then we have a problem of 21 inferring why they waited for a year and-a-half.
22 MR. CHANDLER: Certainly to some extent, the 23 Applicants took a tack of suggesting that the statements of
() 24 . deficiency in the QA program were unfounded. And that 25 their approach to satisfyi'ng the Board was to say "No, TATE REPORTING SERVICE, (713) 222-7177 :
51 1 we'll prove you're wrong on th9 se deficiencies and we'12 go
!"/'\
\~ 2 about showing that you're wrong in a variety of ways." And 3 I think that's how they proceeded in this case.
4 JUDGE BLOCH: You already told me that if it was 5 deficient, that they're charged with the knowledge that it 6 was deficient and yet they came in to prove it was wrong.
7 MR. CHANDLER: They came in, I believe, to show 8 that although there may be deficiencies and again I'm 9 reflecting on something of which I have but limited 10 knowledge, Mr. Chairman, at this point, they came in at 11 that time to show that although there may have been 12 deficiencies in the QA program, that nonetheless the plant (E 13 was constructed, designed and constructed in such a way 14 that it would satisfy the commission's regulations; that 15 the end product would show that the plant could be operated 16 without risk to the health and safety of the public.
17 JUDGE BLOCH: Subsequently, however, many 4
18 millions of dollars are being spent to redesign documents 19 covered by QA for design. Is that correct?
20 MR. CHANDLER: And Mr. Chairman, as I said 21 earlier on, I think it's clear where we sit today in here 22 in mid-April of 1986, that certain of the Applicants' 23 efforts have proven, I'm reluctant to use the word
(} 24 "ill-advised," but certainly not successful in achieving 25 their objective and as a result, they have undertaken this l
TATE REPORT!N3 SERVICE, (713) 222-7177
52 1 CPRT proyram plan, again in an. effort to sea the Board's Ny' 2 concerns, the Staff's concerns and other concerns, to 3 demonstrate the facility that has been properly designed 4' and constructed. And I' don't think --
, 5 JUDGE BLOCH: I do plan to ask Applicants in light 6 of this discussion to have five more minutes before we go 7 to rebuttal if they would like.
8 MR. CHANDLER: But anyway, with respect, 9 Mr. Chairman to the contentions again, we believe that it 10 requires, would require, a quantum leap to go from the 11 language of the contentions presented to us by C.A.S.E.,
12 Ms. Gregory, to a conclusion or even a reasonable -- find a n
I
(..) 13 reasonable basis to suggest that the Applicants' conduct 14 was dilatory.
15 JUDGE BLOCH: Have you focused on the last 16 paragraph of the C.A.S.E. No. 6 or Gregory 1. Excuse me, 17 it's C.A.S.E. No. 6.
18 MR. CHANDLER: The language you referred to 19 before on page seven of the Applicants' pleading, 20 Mr. Chaire=n, that in fact was -- is exactly what I was 21 addressing before when I was suggesting to you that what we 22 have here, again, is a statement without basis.
23 The Applicants came forward in response to the
() 24 Board's criticism over two years and the Applicants' and 25 the Staff's findings were a variety of approaches.
TATE REPORTING SERVICE, (713) 222-7177
53 1 And that simply doesn't translate into the b
ss 2 deliberate actions which is the term that's used in this 3 contention and for that reason we simply find it without 4 basis.
5 JUDGE BLOCH: If we assume that the CPRT program 6 is prudent and that huge sums had to be spent on redesign 7 of the plant, then we'd have to find either that Applicants 8 were ignorant of the problems in the design of their plant 9 until the CPRT program started or that they purposely 10 delayed for some reason. How do we know which to do and is 11 there a ground for inquiring further?
12 MR. CHANDLER: I think we have to look at the 13 record and the basis that is provided within the petition 14 to see if we have to go further. It's not -- it's not this 15 Board's duty to infer the basis, it's the petitioners' 16 burden to come forward with the basis. And they haven't 17 done it.
18 Now, another comment that was made by counsel for 19 C.A.S.E. and there was a point picked up on by the Board 20 had to do with the ability of this Board to impose a 21 condition on the construction permit, itself.
22 The imposition of such a condition I would 23 suggest Mr. Chairman is simply a matter that this Board
(} 24 doesn't have the jurisdiction to undertake. The focus of 25 this proceeding and this Board's jurisdiction is a matter TATE REPORTING SERVICE, (713) 222-7177
54 1 controlled by the subject matter that is before it, namely
(' '
- 2 the extension of the construction permit, an amendment of 3 the construction permit solely for the purpose of extending 4 the time.
5 There are no other authorities granted, conveyed, 6 modified or changed by the extension granted by this Staff 7 but for the time in which the Applicant can conduct 8 activities previously authorized.
9 The recommended remedy that C.A.S.E. or 10 Ms. Gregory may have I think is rather straightforward.
11 It's found in the Commission decision, found in the appeal 12 board decisions on this point, the remedy is through 10 CFR 13 Section 2.206, a request to the Director for the initiation 14 of a proceeding in light of whatever it is they wish to I 15 assert are failures to comply with or deviations from the 16 requirements, the Commission's regulations, or terms 17 provision of construction permit.
18 But this Board doesn't have the jurisdiction, I 19 would suggest, Mr. Chairman, to condition a license except 20 in regard to the time frame.
21 The Midland decision is not inconsistant with 22 that. In Midland, it was, I think as Mr. Roisman pointed t
23 out, a proceed ng initiated in response to an order to show
(} 24 cause, which, itself, was focused on the construction 25 permit.
TATE REPORTING SERVICE, (713) 222-7177
i l
55 1 And certainly in that case, and given the terms 2 of that particular order, it was appropriate for the board 3 in that proceeding, given the scope of its jurisdiction, to 4 impose a condition as it did. Very different situation 5 than obtains here, very different.
6 And simply to suggest that the Commission may 7 have the authority to impose a condition is not to say that 8 this Board could, because as we recognize, this Board's 9 jurisdiction is not as plenary as that of the Commission.
10 The Commission can reach down and touch matters 11 that a subordinant tribunal simply can't because the 12 jurisdiction conferred by the Board -- conferred to the 13 Board is bounded by the notices issued by the Commission in 14 this case, again, speaking only to the construction permit l
15 extension.
16 Mr. Chairman, quite frankly, beyond what I've 17 already said, I think we've already expressed our points of 18 view in response to the petitions in our filing of April 19 18th and unless the Board would have any questions, I would 20 have nothing further to add.
21 JUDGE BLOCH: Thank you, Mr. Chandler.
22 Mr. Dignan, five minutes.
23 MR. DIGNAN: Thank you, Mr. Chairman. To direct
(} 24 my attentions to what I believe to be the thrust of the 25 Chair's remarks with Mr. Chandler; it seems to me that I
f i
TATE REPORTING SERVICE, (713) 222-7177
56 1
At, 1 we're losing sight of the basic Commission rule laid down O-
\M ~ 2 in the first WPPS case. I am in no better position than 3 Mr. Chandler to speculate on why CPRT didn't come into 4 existance earlier than it did in relation to the Board's 5 1983 decision.
6 But, I am equally clear that as_a, matter of law 7 and its irrelevant to what those reasons were for this 8 reason. If you look at the original WPPS decision and 9 particularly page 1230 through 31, what the Commission said 10 vas the following; "If a permit holder were to construct 11 portions of a facility in violation of NRC regulations when 12 those violations are detected <_and corrections ordered or 13 voluntarily undertaken, there is likely to be some delay in 14 the construction caused by the revisions. Nonetheless,
( 15 such delay as with delay caused by design changes, must l
16 give good cause for an extension. To consider it otherwise l
17 could discourage permit holders from disclosing and 18 correcting improper construction for fear that corrections 19 would cause delays that would result in a refusal to extend 20 a construction permit. A result obviously inconsistant 21 with the Commission's efforts to ensure the protection of 22 the public health and safety. This contention thus it's 23 not litigable."
(} 24 Now, the reason I bore down on the words " ordered 25 or voluntarily undertaken," it is clear that the Commission TATE REPORTING SERVICE, (713) 222-7177
57 1 feels that even in the case when something is detected, the O'
t- 2 Applicants doesn't voluntarily undertake it for whatever 3 reason, maybe because they disagree with an interpretation, 4 maybe because they don't move as fast as they should cr 5 whatever reason, it may be ordered. And what the i
6 Ccamission is saying: "If we order a change or the Staff l j
7 orders a change and that delays, that delay is for good 8 cause and that's the end of it."
l 9
l JUDGE BLOCH: We must interpret this to be l 10 consistant with the standard that we're applying about 11 dilatory conduct. So what I think this means, correct me 12 if I'm wrong, some delay is likely after there are 13 problems. The question is at what point does it become 14 willful or dilatory to be delaying in the correction of 15 problems?
16 MR. DIGNAN: As I read the sentence, nonetheless, 17 a separate sentence, "Nonetheless, such delay must give 18 good cause for an extension" is a statement that any delay 19 occasioned with bringing construction into conformity with 20 the regulations of the Commission is a delay for good 21 cause.
22 JUDGE BLOCH: You would interpret that sentence 23 to mean even dilatory delay would be good cause, l
f~)
O 24 MR. DIGNAN: No, I would interpret it the -- as 25 not being dilatory because they have found -- the dilatory TATE REPORTING SERVICE, (713) 222-7177
58 l
I has been ruled to have as one of the prongs of the test not (3
s_/ 2 for a valid purpose. And it is a valid purpose to bring it 3 into conformity with the Commission's regulations.
4 JUDGE BLOCH: But the time we were pointing to on 5 the discussion with Mr. Chandler was between December of 6 '83 and August of '85.
7 MR. DIGNAN: Correct.
8 JUDGE BLOCH: Now, there would have to be some 9 valid purpose for that delay; is that correct?
10 MR. DIGNAN: No. What I'm saying is that it is 11 not -- it is good cause for that delay if the purpose of 12 the delay in the long run is to bring the this thing into 13 conformity.
14 JUDGE BLOCH: How could the purpose of that delay 15 be to bring it into conformity?
16 MR. DIGNAN: You're assuming a delay has occurred 57 in the sense that nothing is being done during that period.
18 And that hasn't been pled, never mind proved.
19 JUDGE BLOCH: Of course for the purpose of this 20 argument, proof is not relevant, you pointed that out.
21 MR. DIGNAN: But pleading is. And it is not pled 22 other than conclusory terms, if that, that that delay was 23 not for a valid purpose.
(~ 24 JUDGE BLOCH: The language is since the burden of G}
25 proof is on you, their assertion is there's no valid l
TATE REPORTING SERVICE, (713) 222-7177
59 1 purpose given by Applicants for why, in the face of these
(_/ 2 criticisms, they refuse to change their QA/QC 3 implementation or addressing correct design deficiencies.
4 So they think that if you've got to prove the --
5 that you've got do assert the opposite of dilatoriness with 6 respect to that delay and that you haven't and that the 7 fact -- their basis is your failure to assert that.
8 MR. DIGNAN: In the first place, as I read 9 earlier, we did assert the reason for it and the reason for 10 it was to bring this thing in conformity with the
- 11 regulation of the Commission. The Commission has ruled 12 that that and that alone is good cause for the delay.
/'h (J 13 JUDGE BLOCH: With respect to the period we're 14 talking about --
15 MR. DIGNAN: The period we're talking-about is, 16 as I have said, might have an argument if the Commission 17 hadn't said whether it be ordered or voluntarily 18 undertaken. The Commission obviously knew there could be 19 cases where the Applicants didn't voluntarily go forward 20 and had to be ordered to do it and that didn't make any 21 difference to it; the delay still was for a good cause 22 whether it be ordered or voluntarily undertaken.
23 And all that can be said, you know, no matter
(} 24 what one wants to imagine about what went on between '83 25 and '85, as I've said, like Mr. Chandler, I'm in no TATE REPORTING SERVICE, (713) 222-7177
60 1 position to represent one way gr the other on that.
\s 2 The point is that it wasn't voluntarily 3 undertaken but then nothing was ordered, either, and passed 4 up. And I think that's what the Commission is talking 5 about.
6 secondly, the whole question of the delay is when 7 does the delay set in. The question is: Is there going to 8 be a delay beyond, let us say today, if that was the date 9 the decision of this Board was to come down to do what, to 10 get this plant into conformity with the regulations of the 11 Commission. That is for a valid purpose, 12 JUDGE BLOCH: I don't call that a delay. If your
() 13 purpose is to conform with the regulations, that's not even
- 14 a delay.
15 MR. DIGNAN: It's a delay in the setting of this 16 because the reason is you're asking for the permit 17 extension because there has been a delay and the reason 18 there's been a delay, I read this decision as saying is if 19 the delay is because you're undertaking corrections, 20 whether they be ordered or voluntarily undertaken, that's l
21 okay.
22 And that's what's going on right now and that's 23 why we need the extension. And that's, I think, the thrust
(} 24 of this decision.
25 JUDGE BLOCH: Thank you, Mr. Dignan.
TATE REPORTING SERVICE, (713) 222-7177
61 1 Mr. Roisman. ,
f"'l Eme/ 2 MR. ROISMAN: Mr. Chairman, I think a lot of the 3 conversation that you got from Mr. Chandler and Mr. Dignan 4 blurred the differences between the good cause for the 5 delay and the good cause for the the extension. And I 6 submit and they have not responded to this, that a reading 7 of ALAB 722, which is really the place where the Commission 8 has put the gloss through it's appeal board on what the 9 Commission's WPPS decision means, there are two distinct 10 inquiries.
11 The Applicants' perception that the good cause 12 for delay means that you all you have to show is that you
('1, x- 13 intend to use the new time that you get to do work to bring 14 the plant into compliance is simply not the test.
15 The whole purpose of having a valid -- if you 16 look at the history of the WPPS cases, the arguments 17 centered on, "Why didn't you get the plant completed with 18 in the original time schedule?" None of it related, 19 because we weren't dealing there with a reinspection, 20 redesign and rework effort, none of it related to the fact 21 that "We need more time to go back and correct our 22 problems" as much as it dealt with and focused on, "Why did I
23 you have the problems in the first place?" ;
(} 24 And what the appeal board has said and what the 25 Commission has endorsed is: The Applicants must establish l TATE REPORTING SERVICE, (713) 222-7177
62 rx 1 either that it wasn't their doing or that if it was their f v.) 2 doing, they had.a valid purpose for doing it.
3 Separate from that is the question and that's 4 what I pointed out.before in ALAB 722 on page 553, is the 5 question: Do you have a good cause for the extension?
6 And at the end of page -- excuse me, at the end 7 of Page 553, ALAB 722, they say, "A judgment must still be 8
made as to whether continued construction should 9 nonetheless be allowed."
10 That's the good cause for extension question.
I 11 Now, the Applicants have not -- I think the 12 questions the Board put before are extremely pertinent.
x_) 13 The Applicants have not given the basis for the delay.
14 They have given us no basis. '
15 Now, Mr. Dignan made an important and significant 16 concession in his original statements. That concession was 17 that the way to prove the dilatory standard is to show the 18 subjective intent of management. We agree. That is how 19 you prove it.
20 What he has neglected to do is to explain why the 21 Applicants have -not met their initial burden of pleading 22 what was the subjective intent of management; what was the 23 intent of management in not listening to the warnings that
(} 24 they were getting in their audits and in the inspection 25 reports and finally in this Board's order in 1983.
TATE REPORTING SERVICE, (713) 222-7177
63 1 Now, we think it would be absurd and we are im
( i x/ 2 certain that there is no such regulation that we must plead 3 subjective intent based upon having probed the Applicants' 4 witnesseses without ever having the right to conduct that 5 kind of discovery.
6 Mr. Dignan asserts an evidentiary basis must be 7 given. The Commission's regulations 10 CFR 50 -- excuse me 8 10 CFR 2, appendix A, in section Roman 3 A-1, merely state 9 that the petition must file, petitioner must file with a 10 supplement to his petition containing his contentions and 11 basis thereof not later than 15 days, et cetera, et cetera.
12 We submit that the Commission's long-standing tm/ 13 practice which is equally applicable here, is that you must 14 provide a basis in the sense of saying, "If I could prove 15 these things, then I would have proven what I need to 16 prove."
17 Now, what we have said is proof, No. 1, 18 Applicants have not given us the stated purpose for the 19 delay. They have not told us what the subjective intent of 20 managevant was. They must first do that. We can't plead 21 against a zero.
22 And so we have made as our first contention here, 23 the argument that Applicants haven't met their burden. The
/~' 24 Board can look at -- Mr. Dignan, I thought, somewhat U]
25 candidly conceded that the pleading which is the TATE REPORTING SERVICE, (713) 222-7177
64 1 Applicants' total pleading, the January 29th letter, is k-) 2 brief. It certainly is. It would not meet Mr. Dignan's 3 test for basis, it would not meet my test for basis and it 4 does not meet the Commission's test for basis.
5 What is the basis for the Applicants' assertion 6 that the delay was not dilatory. It doesn't appear in this 7 document. We do not know what the subjective management 8 intent was.
9 We know why they want more time now, but we don't 10 know why they need it. We don't know what the subjective 11 intent wus. All right.
12 No. 2, the WPPS decisions which I think 13 Applicants have indicated do not disclose the history of 14 basis, actually do.
15 In ALAB 722 at page 550, the last full paragu ph 16 on the page, the appeal Board recites in the next two 17 paragraphs, the pleadings of the two parties. The 18 Commission referred the issue to the licensing boards and 19 goes on.
20 I will not read those here but simply refer the 21 Board to that and say in particular note the paragraph that 22 begins at the be* tom of pages noted, the applicant contends 23 and look at the kind of claims that the Applicants made in They went back and challenged or attempted to
(} 24 WPPS.
25 establish why they weren't able to do it righ' the first TATE REPORTING SERVICE, (713) 222-7177
65 1 time. They went back and said,,"Oh, that's not the reason.
(N
(-) 2 It wasn't our mismanagement, we weren't bad fellows; we got 3 held up by" and then they list these factors.
4 They tried it, in effect, they tried to say it 5 wasn't our fault. Now this applicant doesn't even assert 6 that it wasn't their fault. There's some admissions today 7 that suggest that they're conceding that it is their fault, 8 but more importantly, they don't tell us why. They do not 9 share that with us.
10 Now, we have in the WPPS licensing board 11 decision, a discussion at some length of the kind of 12 factors which an applicant would -- which would be
() 13 legitimate to'look into in this inquiry. And I'm referring 14 now to --
15 JUDGE BLOCH: Beft e we go on. I noticed at the 16 bottom of 551, the appeal board is talking about the 17 applicant has been indifferent to the timely completion of 18 the project.
19 MR. ROISMAN: That's correct.
20 JUDGE BLOCH: Is it your belief that that is an 21 alternate meaning of dilatory?
22 MR. ROISMAN: No, the appeal board says that 23 indifference alone would not be enough to establish
('T 24 dilatory.
()
25 JUDGE BLOCH: Okay.
TATE REPORTING SERVICE, (713) 222-7177
m 66 1 MR. ROISMAN: Now, there's no pleading there.
(
L>
l 2 The applicants give a counter reason, the intervenor 3 attempts to say that the counter reason is false, and they 4 join issue on that.
5 But here we have no reason from the Applicant.
6 But this whole discussion makes clear that the focus was 7 not on the reason for the extension in looking at the 8 dilatory question, it was on the reason for the delay. And 9 the reason for the delay was, why did things breakdown.
10 And the intervenor there tried to argue and the 11 licensing board has seemed to accept the principal and then 12 ruled against them on the merits, that if you were O
(_/ 13 indifferent to the consequences of your act that would be 14 called the kind of dilatory conduct that would be 15 objectionable.
16 JUDGE BLOCH: To be c. ear, what you --
17 MR. ROISMAN: The appeal Board rejected 18 indifference.
19 JUDGE BLOCH: What you think you've done is to 20 state that the Applicants' filing does not provide good 21 cause and that you provided an alternate good cause 22 consisting of enough to inquire further about whether the 23 cause was dilatory.
(} 24 MR. ROISMAN: Let me agree yes on No. 1 and if I 25 may just postpone for a moment answering No. 2. I want to TATE REPORTING SERVICE, (713) 222-7177
r 67 1 go to No. 1, namely what is - .an applicant must establish (3
k/ 2 and direct your attention to the licensing board decision 3 which was affirmed on appeal, LPB84-9, it was affirmed on 4 appeal in a ALAB 771, and this involves WPPS No. 1. And at 5 Page 503, the licensing board says --
6 JUDGE BLOCH: What's the full cite.
7 MR. ROISMAN: I'm sorry, 19 NRC 497, at 503.
8 The licensing board in speaking about this issue 9 of the intent; corp; rate dealings and motivations are 10 sufficiently arcane not withstanding the matters placed 11 upon the public record in the form of corporate minutes, 12 resolutions and recommendations, to afford a litigant the
() 13 right to go behind these records to seek the testimony of 14 participants in the corporate transactions. Intervenors 15 not taking discovery depositions possibly for lack of 16 finances but that would not preclude it from examining for 17 the first time at an evidentiary hearing the appropriate 18 officials of WPPS and BPA to identify the actual decision 19 maker.
20 Now as in that case the board holds that using 21 the standard that the contention does not meet the test.
22 But my point is to explain, the universal understanding in 23 these cases of what kind of inquiry we're talking about.
~
/V') 24 And Mr. Dignan and Mr. Chandler are talking about 25 an inquiry that is different. They think the inquiry is TATE REPORTING SERVICE, (713) 222-7177
68 1 what are you doing now that's causing you to need more s 2 time, not how did you get here. And that's the inquiry 3 that the Applicant has not pled to and for that reason 4 alone there would be a basis.
5 Now, let's go to your second question which was 6 what do we mean when we say in the second paragraph of our 7 contention, we put forward with we think the reason is; 8 number one, I believe that that paragraph meets every 9 pleading requirement of the Commission's for a statement of 10 basis. I do not believe it's necessary for C.A.S.E. to 11 list all of the individual reports that we are referring to 12 there.
13 What we are saying is when you go to those 14 reports, when they are in evidence, you will see that the 15 Applicant is being told stop doing this and that in fact, 16 Applicant kept doing what it was they were told to stop 17 doing.
18 To whatever extent this Board feels that we 19 should have at least told you that, it was attached to our 20 original pleading to the Commission filed on January 31st, 21 Appendix B, in which we laid out for the Commission in our 22 motion with ragard to this entire issue that they should 23 not allow the exter.sion to remain in affect, and we laid
() 24 out in detail each one of those reports and explained what 25 was wrong with it.
TATE REPORTING SERVICE, (713) 222-7177
69 ;
1 We did not do it her9 because we believe it is
/'N I
\x) 2 not required for us to do it here. What is allowed and 3 what we think we have done is we have indicated that we can 4 show conduct by the Applicants, unexplained by them, from 5 which at least a reasonable inference is that they had no l 6 valid business purpose; the test here, the test is not the 7 test of Mr. Dignan keeps repeating, the test is, it has to 8 have been done with without a valid purpose.
9 And the concomitant is that the Applicants must 10 assert a valid purpose and that we on the other hand may 11 allege, as we do, that there was not a valid purpose. It 12 is not valid to try to build a nuclear plant in violation
/\
(_) 13 of Commission regulations in the hopes that you can sneak 14 it by. That is not permitted. Whatever a valid purpose 15 is, that isn't one. And that's what we are alleging in 16 that paragraph.
17 Applicants say that the construction of the plant 18 is essentially completed. I just want to be clear on that.
19 It's not completed. It's a long way from being completed 20 because the word " completed" only makes sense in this 21 hearing if we mean " completed properly."
22 They have built an unlicenseable plant out there.
23 They are in the process according to there most recent
(} 24 filing to the SEC, of tearing out big pieces that they have i 25 built and replacing it. That was not completed TATE REPORTING SERVICE, (713) 222-7177
70 1 construction, that was improper construction, p
'\ -)
m 2 So any argument, I don't think any of the 3 arguments here really depend upon that question but any 4 argument that is based upon how much the plant was 5 completed, the answer to that is we already know a lot of 6 it wasn't completed, and that we are uncertain as to how 7 much of the rest of it was completed. That's the best that 8 can be said about completion. All right.
9 Second question, what about the extension, that's 10 our Contention No. 2, C.A.S.E. Contention No. 7, what is 11 the good cause for the extension. And what we've really 12 evolved into here is an argument over the question of
) 13 whether you can or cannot put conditions on to the 14 construction -- excuse me, on to the construction permit 15 extension.
16 And I think again, that the findings of the 17 license -- excuse me, the decisions of the appeal board in 18 both ALAB 722 and 771 give us a lot of insights into the 19 need to make a separate inquiry into the cause for the 20 extension, separate and apart from the cause for the delay.
21 For instance, I've already cited the board to 22 553 at the bottom of the page where they talk about making 23 a separate determination on that question; and would refer
() 24 you also to ALAB 771 19 NRC, 1183 and 1191, when the board 25 says in explaining why the coalition hasn't done what it TATE REPORTING SERVICE, (713) 222-7177
71 1 should do, "The coalition does.not claim that the extension
(\<-) 2 has genuine and immediate health safety or environmental 3 implications. That being so we find that there were no 4 facts appropriate lor hearing."
5 we have claimed precisely that We have claimed 6 following the line of the Zimmerman and Midland cases that 7 continued construction of a plant in violation of 8 Commission regulations is itself a significant and 9 immediate health safety or environmental implication.
10 JUDGE BLOCH: But more than that you s:laim that 11 it is relevant to this amendment because the substance of 12 this amendment is the good cause for the delay, as opposed
, () 13 to just what Applicants were asserting, it's just to change 14 the time? They would say amendments must relate the only 15 only to the extension of time and you're saying they can 16 also relate to the cause for the delay?
17 MR. ROISMAN: The issue of whether or not they get 18 the extension --
19 JUDGE BLOCH: It's the relevance question.
20 MR. ROISMAN: Is a two pieced issue. Piece one 21 is, was there good cause for the delay. Piece two, is 22 there good cause for the extension.
23 JUDGE BLOCH: Let me slow down a second. What is
(} 24 the test of relevance of a condition to a proceeding to 25 extend the time limit on a construction permit? We TATE REPORTING SERVICE, (713) 222-7177
72 1- obviously have the authority to attach relevant conditions.
-{Os /' 2 Applicant's were contending that there is no such thing as a relevant condition to an extension of time.
3 4 MR. ROISMAN: All the initial construct:.on permit
- 5. is is a grant of time, it's time to build the plant. I 6 mean all of these --
7 JUDGE BLOCH: No, it's more than that. It has a 8 whole set of design things that are reviewed, safety things 9 that are reviewed. Their contention'here is this is much 10 'narrrower, it's just a question of time and that no 11 conditions are relevant just to the extension of time. We 12 either say there's good cause for more time and grant it or
() 13 we say there's not and therefore conditions would not be 14 relevant.
15 MR. ROISMAN: And that I submit as what you've j 16 just framed is what the appeal board has already said is 17 not enough. The appeal board has said -- I mean this 18 statement that I just quoted on page 1191 of ALAB 771 makes 19 no sense if the only things that's on the table is how much 20 more time do you want, why would the appeal board chastise 21 the coalition for not claiming that the extension has a 22 genuine and immediate health safety for environmental 23 implication.
(} 24 It would only chastise them for that if by 25 alleging that and having a basis for that allegation, they TATE REPORTING SERVICE, (713) 222-7177
1 I
73 1 had something to prove that was relevant to the proceeding, I
(/ m 2 And similarly, why would the appeal board say 3 even after we get through the good cause for delay issue, a 4 judgment must still be made as to whether continued 5 construction should nonetheless be allowed, not whether 6 they should be given more time to do construction, but 7 whether the construction should be allowed.
8 JUDGE BLOCH: My problem with that 9 interpretation, that's on page 553.
10 MR. ROISMAN: That's right, at the very end.
11 JUDGE BLOCH: Is that that seems to me to be 12 related to a chain of logic that's actually restrictive
) 13 rather than expansive. The Commission is saying, rather 14 the appeal board is saying --
15 MR. ROISMAN: You're right, it is a chain of 16 logic that was restrictive and not expansive.
17 JUDGE BLOCH: Are you urging an expansive 18 interpretation of that --
19 MR. ROISMAN: I'm just arguing that's what is 20 sauce for the goose is sauce for the gander. It certainly 21 cannot be the rule that an applicant may argue for an 22 extension even if it cannot prove good cause for the delay, 23 based upon the value and the need for continued
(~T 24 construction. But an intervenor cannot argue the opposite.
A/
25 JUDGE BLOCH: What they're saying is even if it's TATE REPORTING SERVICE, (713) 222-7177
74 1 dilatory, first of all you don't undertake the proceeding
'b Lv/ 2 unless, unless there's.an allegation that~it's dilatory.
3 Enough reason to inquire further. That's my 4 interpretation, and not based on the specific words here 5- but --
6- MR. ROISMAN: All right.
7- JUDGE BLOCH: Even if it is dilatory, you still 8 must make a judgment as to whether to allow construction.
9 Now, I don't see how that goes to what you're using it for 10 which is to say that even if it's not dilatory, we could 11 attach a condition on a continued construction.
12 MR. ROISMAN: I'm not using it for that. I'm 13 sorry.
14 JUDGE BLOCH: I misunderstood that. What ere you 15 using it for?
16 MR. ROISMAN: I'm using -- I have no problem with 17 the argument, at least for now, that if Applicants were 18 able to prove their case and we were unable to prove to the 19 contrary that on the good cause for delay, that then we 20 would be in a different posture on the question of the good 21' cause for the extension.
22- Now, that's not to say that if we were in that 23 posture, we would concede that this board does not have the 24 residual -- you have the power to deny the extension. You
( }-
25 have all the powers that are short of that. I mean the de TATE REPORTING SERVICE, (713) 222-7177
75 l
1 facto as to of what you can do, I mean if this sort of A
%) 2 technical argument is right, you could say to an applicant 3 "We're going to deny this; if in 30 days you come in and 4 tell us you're going to do this, this, this and this, we'll 5 reconsider our decision."
6 JUDGE BLOCH: What this stands for --
7 MR. ROISMAN: Which is what you did in December 8 '83.
9 JUDGE BLOCH: What this stands for is if we find 10 that the conduct was dilatory, at the end of that 11 proceeding, we could still, instead of denying the license, i
12 condition it.
() 13 MR. ROISMAN: Correct.
14 JUDGE BLOCH: And is a prerequisite to 15 conditioning it in your opinion that we must find first 16 that it's dilatory?
17 MR. ROISMAN: I would say in the realities of 18 this case that it would be dramatically more difficult for 19 us to justify why it needed to be conditioned if you had 20 already concluded that there had been a good valid purpose 21 for the delay.
22 JUDGE BLOCH: So at this stage of the case, 23 there's no independent basis for admitting a contention
(} 24 addressed only to conditions because you would have had to 25 established dilatoriness --
TATE REPORTING SERVICE, (713) 222-7177
76 I
1 MR. ROISMAN: No, I'm sorry, what I'm saying,
- I
,^,
2 when I'm avoiding committing to is the proposition you want 3 me to commit to. I'm not conceding that if we lost good 4 cause for delay, we could not still argue for good cause 5 for extension. What I'm saying to you is: Why don't we 6 not argue about that because I think in the facts of the 7 caser our case would be dramatically more difficult and we 3 would have to rethink it.
9 But I don't believe as a matter af law that if 10 you had an applicant in front of you and the causes for the 11 delay were just dynamite, I mean they were the best causes 12 you ever saw but they had told you we intend to use the
(_, 13 three years that you're going to give us to do things that 14 no one would allow us to do legally, that you should simply 15 put your hands over your eyes and say " Gee, there's always 16 2206 and Mr. Stello to exercise it."
17 I think that you have the authority and probably 18 the duty to say, " Forewarned is forearmed, you people may 19 not go on building in the next three years unless you 20 intend to meet these specific requirements."
21 And incidentally, although Mr. Dignan said we 22 didn't tell you what the requirements were, contention 2D, 23 or 7D, lays out precisely what conditions we think should be imposed on this construction permit.
(} 24 And those extensions and those conditions are very close to the 25
' ATE REPORTING SERVICE, (713) 222-7177 1
~
l 77 1 conditions that the Commission, laid down in the Zimmerman n
, 2 case. And it's of the same type of conditions.
3 Finally, it is argued that this is just a 4 continuation of the original construction permit. And 5 thus, this is nothing, nothing here is happening. The 6- record will show and we have pled it, that the Applicants' 7 matching of its conduct to the original construction permit 8 has not occurred. There's no match. They aren't doing 9 what the original construction permit told them to do.
10 And we believe that coming in to a request for an 11 extension proceeding, they're both obligated to give you 12 the real reason why they didn't, that'e the subjective
(~ 13 intent that Mr. Dignan was talking about, and that they 14 are -- that they are obligated to give you some reason to 15 believe that they are going to do something about it when 16 they get the extension, that there is some value to going 17 into that process of giving them the extension.
18 And we submit and we have pled it here, not 19 proved it, of course, we've pied it, that they don't intend 20 to do this correctly. Probably the most glaring example of 21 their intent is the pleading filed in opposition to our 22 response to the proposed schedule, in which we get of what 23 I submit is a Lewis Carroll version of how to comply with
{} 24 Commission regulations. Lots of mirrors and no substance.
25 Now, we don't have to prove that that's what TATE REPORTING SERVICE, (713) 222-7177
78 1 they're going to do, but I submit to you that that is at b
'ss/ 2 least one place you can look and see that we're not talking 3 about we think that what they think they're going to do is 4 wrong; I think that they disclosed what they planned to do 5 and how they think they can get around the requirements of 6 the Commission and of this board as to how you have to go 7 about getting a construction done so that you have a 8 reasonable assurance at the end of it.
9 By not talking about our third and fourth 10 contentions and the contentions eight and nine of C.A.S.E.,
11 I by no means mean to say that we do net consider them 12 equally important. I think I mentioned them briefly in the t
k,) 13 opening statement. I feel that particularly on the 14 environmental one, that there really is no adequate 15 rebuttal that has been provided and it should be admitted 16 just on the NEPA issues that we raised there.
17 I would mention one thing and that that's the 18 board probably remembers, in the Calgert Clipps case which 19 is 449 Fed 2nd, 1109, in the U.S. Court of Appeals, one of 20 the issues before the court was whether or not in the 21 interim between a construction permit and an operating l 22 license, the Commission could say, "No will not do an l 23 environmental impact because the environmental impact that
(} 24 we are doing is related to a issue that'll come up at the 25 operating license stage."
TATE REPORTING SERVICE, (713) 222-7177 l
79 1 And in the context of NEPA, the court said no
(-
(~)] 2 because you get irretrievable commitment of resources, you 3 have to do an interim environmental impacts analysis.
4 We submit that this extension request in light of 5 the Staff's environmental appraisal and the factors that 6 they considered to be relevant, an interim appraisal is 7 appropriate because the staff has attempted to allege that 8 there is no commitment of resources that is not already 9 approved, and that the plant is necessary and that the 10 findings that were made at the construction permit stage 11 all remained valid.
12 So they have put it in, we've challenged their
() 13 pleading that environmental appraisal, which incidentally 14 is the Staff's pleading, I guess, on that issue.
15 JUDGE BLOCH: Is that argument at all affected by 16 the rule prohibiting the argument of NEPA issues in 17 operating license cases?
18 MR. ROISMAN: If anything, I assume it's 19 strengthened. We don't have the applicant or the Staff 20 attempting to argue to us that you're arguing this issue in 21 the wrong place, you've got another forum.
This is the 22 forum. I 23 JUDGE BLOCH: Are you done?
(} 24 MR. ROISMAN: I'm done.
25 JUDGE BLOCH: I would just like to ask a brief i l
TATE REPORTING SERVICE, (713) 222-7177
80 1 question about the status of the Appeals Court case.
,y k) m 2 MR. ROISMAN: I have no word as to the appeal 3 board.
4 JUDGE BLOCH: You haven't had oral argument.
5 MR. ROISMAN: No, all the briefs have been 6 submitted and the reply brief has been filed and that was 7 all done by -- about two weeks ago. And as far as I know, 8 the court has not asked for an oral argument and there has 9 been no word from the court on decision schedule or whether 10 there will be an oral argument or a decision.
11 JUDGE BLOCH: So we just have no idea.
12 MR. ROISMAN: We have no idea at all.
3 13 JUDGE BLOCH: Mr. Dignan, do you have anything to 14 explain that?
15 MR. DIGNAN; No, I am not handling that aspect.
16 I would say though that I'm sure Mr. Roisman will agree, as 17 I understand the briefs have been filed and what's pending 18 is the motion for stay. These are not briefs on the merits 19 of the appeal.
20 MR. ROISMAN: That's correct.
21 JUDGE BLOCH: So there's no reason to defer our 22 decision for anything the appeals boards may or may not do.
23 MR. DIGNAN: None that I can perceive.
24 JUDGE BLOCH: Okay, well I want to thank the
(
25 parties. This phase of the proceeding is adjourned. We TATE REPORTING SERVICE, (713) 222-7177
4 81 1 will call to order the licensing board in approximately 15 4
(3 / 2 minutes. What we'll want at that time is a maximum of 20 3 minutes a party on the board's proposed order.
4 And then after that, we anticipate setting a 5 time schedule for argument of the scheduling motion with 6 respect to issues not raised in the proposed order of the 7 board. Is there any objection to that way of proceedingi 8 MR. DIGNAN: May I just advise the Board, Mr. Gad 9 will speak for the applicant on both of those matters, your 10 Honor.
11 JUDGE BLOCH: Is there any objection to that way 12 of proceeding?
O)
(_ 13 There being none, the hearing us adjourned until 14 11:08.
15 (Hearing adjourned at 10:53.)
16 17 18 19 20 21 22 23
( 24 25 TATE REPORTING SERVICE, (713) 222-7177
82 1 CERTIFICATE OF OFFICIAL REPORTER p
2 \
3 this is to certify that the attached proceedings before the 4 UNITED STATES NUCLEAR REGULATORY COMMISSION in the matter 5 of:
6 7 NAME OF PROCEEDING: TEXAS UTILITIES ELECTRIC COMPANY, et al.
8 (Comanche Peak Steam Electric Station, Unit 1.)
9 5 10 11 12 DOCKET NO.: 50-445 (CPA) hF 13 PLACE: DALLAS, TEXAS a
14 DATE: TUESDAY, APRIL 22, 1986 15 16 were held as herein appears, and that this is the original l
{
17 transcript thereof for the file of the United States 18 Nuclear Regulatory Commission.
19 20 21 i
, NN ~
22 R. Patrick Tate .
Official Reporter 23 Tate Reporting Service 1
25 '
TATE REPORTING SERVICE, (713) 222-7177