ML20235X432
| ML20235X432 | |
| Person / Time | |
|---|---|
| Issue date: | 09/08/1987 |
| From: | Mcdonald W NRC OFFICE OF ADMINISTRATION & RESOURCES MANAGEMENT (ARM) |
| To: | Fraas A OFFICE OF MANAGEMENT & BUDGET |
| Shared Package | |
| ML20235X338 | List: |
| References | |
| FOIA-87-570, FRN-52FR7432 AC45-2-06, AC45-2-6, NUDOCS 8710190361 | |
| Download: ML20235X432 (5) | |
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NUCLEAR REGULATORY COMMISSION d
WASHINGTOel, D. C agges
-SEP 8 _1ggr Mr. Arthur G. Fraas, Acting Chief
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Natural Resources Branch
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Office of Information and Regulatory A* fairs Execgttve Office of.the' President Office of Management and Budget Washington, DC 20503 1
Dear Mr'. Fraas:
in u r This..is in -response.to your letter dated August 7,1987 in which OMB s
disapproved the information collectbn requirements embodied in the Ruclear and Accu. Regulatory Comaission's. proposed rule regerding:"Com ness racy sof. Informathn."
Because we beheve that your~
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based upon a misunderstanding of the cnd the. Commisskn's intention in promu wirements of the proposed rule ating such requirements, <we respectfully request that you reconsider your disapproval of this informatkn collectkn and authorize its promulgatbn in final form. -
underlying the comments made in your letter appears to be th's behef that i
the Commisskn's proposed rule-entails the creation of.:.new reporting requirerients whit.h were. not previously in effect. " It is1 critical to emphasize'that the proposed L rule : creates' no reporting ob ations that were not in hcensees are 'n. existence prior. to its deve ment;.1.e.
spp ants and I
a ot~obMgated b Commission ^ thatcthey were.y/this" rule to- ~a single document with the I
not ~ already under'~ ant ob n e torsubmit pursuant to the fuTI disclosure. requirements of Section 5 of the" Atomic Energy discusse?Act3s interpreted ein the -VEPC0~deciskn,* which 1sicited and d ine.t Power Cosbany,he preamble ;to the proposed.: rule.r(North Anna Pow Vireiniaf Electric &
MR C gmD_ E 976).- aff'd, 571 F.2d R89. (4th Circuit 1978).
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W, As bngLago as 1964, the : Atomic Energy Commission, predecessor of. the Nuclear g, Regulatory Commission,. had emphasized..in an adjudicatory decishn that in order:to discharge.the commission's responsib1Mties for.
pubile. health - and t
. safety. - it must -insist upon. total candor in communicathns between Mcensees and the,Commisskn, and that "nothing o
a lesss than candor-~1s sufficient.".
' Matter of HanMn Testing-Laboratories..
Inc., 2.,AEC1423, 42811964).#cIn the VEPCoa decision discussed in the
, preamble to the proposed rule
.the regulation of nuclear powe:theicommissionFreemphasized the fact ~that
/
and, safety, re r.. impiteeting as it does the'pubhc. health
'8 the Commission. quires " full disclosure of material data" from licensees to (Emphasis added).
The commission further emphasized in that decision the absolute necessity that licensees ' scrutinize their-internal procedures to be as sure i
submissions to this' Commission are accurate."as they( possibly can that all '
Emphasis added).
The Commisskn quoted with approval the prior Atomic Safety and - Licensing 8710190361 871014,.
i NER 70 PDRk A /g
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'- @8 Iggy licensee's and a
obijgations established by the VEPC O decishn. pplicant's I trust the informathn provided above 'and the language to be included in the final rulemaking package. clarifies that the new rule obhgates apphcants and. heensees to do nothing more than they - were already obhgated to do by Section 186 of the Atomic Energy Act as interpreted in the VEPC0 decision.
t Several other points are critical to understand with regard to. your comments on both paragraphs (a) and (b) of the prop)osed rule in the August 7th letter.
First, with regard to paragraph (a, it is important to reahze that this paragraph creates no informathn collection requirements at all.
Rather, this proviskn simply requires that -any informathn; which is subattted to the Commisskn-be " complete and accurate in aTI maErlal respects."
In this regard, contrary to the assertion on paga. 2 of your August 7th letter, nether the VEPCO' decision which is codified in this rule, nor the proposed rule, rec uires absolute com pleteness or total accuracy of information and the Comm$sion is not imposing by promulgating this rule.an open-en,ded requirement that information be counlete and accurate, Rather than absolute completeness 1
and total accuracy, the proposed rule requires completeness and accuracy "in all material respects."
Materiahty was a ters that was discussed in i
the various adjudicatory decisions leading to the Commistkns YEPCO decision in 1976.
The definition of the term "materiaP which the Commisskn acopted in the VEPC0 decision, i.e.
information that has a natural tendency or capability to influence a re,sonabh agency expert, a
did not originate with the Commission but was taken fro's a long hne of criminal cases which defined that standard.
Thus, the term ' material" has become a ters of art in the Commission's enforcement lexicon and is well understood by the reguisted industry.
}
By emphasizing in the VEPC0 deciskn that only material information is required to be reported, the Commisskn made clear that it did not intend or expect absolute completeness and total accuracy of all informathn provided to it.
As the Commission stated in that deciska:
By reading material false statements to encompass omissions of material data, we do not su'Igest that unless aTI information, however trivisi, is forwardec to the agency.the appitcant.will be subjected to civil penalties.
An omisskn must be material
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to the licensing process to bring Section 186. into play.
As discussed above, determinathns of materiality require careful,'
I common sense judgments of the context in which information I
appsars and the stage of the licensing process involved'.
Materiality depend:: upon whether information has a natural tendency or capabihty to influence a reasonable agency expert.
There will be hard cases in determining which omissions are material just as there are hard cases in determining uhich affirmative false statements are material.
i, 3
1
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r SEP 8 tggy The existence of hard cases does not argue for changing the j
appropriate rule of law.
It is also important to understand that in our view, proposed paragraph (a) w111' result in a more equitab)e treatment of Itcensees than was prevkusly the case.
Prbr to the formulatkn of this regulation, failure to submit complete and accurate information could only be penahzed by the Commission under the umbrella term
" material false statement" pursuant to Section 186 of the. Atomic Energy Act.
Under the VEPC0 doctrine, the Commission not only penalized intentional false statements as material false statements but also punished.as material false, statements-those failures to supply complete and accurate information which were the result of carelessness and which did not involve any intentbn to mislead or deceive the Commission.
This was often unfair to the Mcensees' involved, because the ters material false statement is. equated with by most people with lying and an intention to mislead. ' Thus, prior to the development of the proposed rule, the citation of.a Mcensee for a material false statement created.an impression in the minds of the public which 3
often was not justified by the circumstances of the case.
As you will note, and as is emphasized in the proposed rulemaking package, the pro)osed rule does not utiMze the term " material false statement".
By c' ting Meensees for a failure to provide complete'and/or eccurate information to the Commission. under the proposed rule,, the j
Commission will be permitted to utilize the same range of ' enforcement 1
sanctions formally available to it under the VCPC0 doctrine without unfairly and impliedly labeling a licensee as a "Mr" by using the term
- naterial false statement."
As the preamble to the proposed-rule makes clear, the label " material false statement" will be reserved for situatbes in wnich there is an element of intent to deceive or mislead the Commission.
l Paragraph (b) of the proposed rule, at stated ab ve, codifies in modified i
fore ~the full disclosure requirements of the VEPC0 decision. _
.As discussed above, no new burden to report information is embodied in the proposed rule.
Indeed, the burden on hcensees should be reheved to some extent.
Licensees have always been and continue by virtue of this rule to be under the obMgation to provide to the: Commission signtricant safety information not already covered by specific reporting requirements.
However, prior to the promulgatbn of this rule, Mcensees and applicants were not only obligated to make judgments concerning information that they considered significant and thus re sortable, but they were,a)eo forced to anticipate the after-the-fact juc geent 'of. the NRC staff with~
regard to its own view of the significance of the informathn.
Paragraph-(b) of the proposed rule requires only that information identified by the heensee or applicant as 'significant be reported to the Commission.
lie believe it is easier for a icensee to determine what the heensee itself believes is 'significant than to determine what another party (the NRC) believes is significant.
Moreover, the final rulemaking package gives j
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- SEP 8 1987 guidance, in the form of exampics, as to what could indicate recognition by licensee of the significance of the information.
In your August 7th letter the concern is also raised that the Commission has not identtfled, with regard to paragraph (b) of the proposed rule, what might fail into the residual category of informathn covered by that j
provision. As set forth in the preamble to the to the initial description of the " full disclosure" proposed rule, subsequent requirement in - VEPCO, a substantial number of specific reporting requirements have been prom ulgated, dealing with both materials and reactor licensees.
Most safety information which a licensee may develop will likely be required to be reported by one or more of these specific requirements.
However, as the Commissbn recognized in the VEPC0 decision, "no set of : specific regulatkns, however carefully drawn, can be expected to cover all q
i poss%1e circumstances. Information may come from unexpected ' sources or 4
take an unexpected form, but if it is material to the licensing deciskn and therefore to the public health and safety it must be passed on to the Commission if we are to Jerform our task."
Thus, there may be some circumstances where a 'icensee possesses significant residual siafety informathn not otherwise required to be reported, which could effect licensed activities and therefore which must be reported in the interest of j
public health and stfety. However, it is impossible to identtfy in advance what residual information would be rec uired to be reported under i
paragraph (b) because it is, by definitdon, a category of informathn which we have not previously anticipated. If we cou)d antkipate the type of residual information which might be reportable pursuant to paragraph (b),
we would already have promulgated a new spectfic reporting requirement to cover it.
It bears emphasis that since most signtfkant information is already required to be reported by specific provisions already in the Commissions regulations, reports of infbreathn pursuant to perugraph (b) of the proposed rule should be infrequent occurrences.
This point will be reemphasized in response to comments in the final rulemaking package.
You questkn the' reasonableness of the two-day reporting requirement for information found by a licensee to be significant under paragraph (b). It should be stressed that this two working days requirement attaches only J
upon a determinattn, by responsible licensee management, that the information has a significant implication for public hea th and safety or the common defense and security.
Until such a determination has been i
made, there is no reporting requirement under proposed paragraph (b).
Further, the final rulemaking package makes it. clear that the reporting may be oral.
Accordingly, two working ' days should be ample time in which to report the information, once its significance is recognized.
Finally, with regard to your comment that the preamble to the proposed rule did not constttute practical guidance that would enable officials of a licensee to determine what information is. reportable, it should be reemphasized (and we will do so in the final rule) that it is only when the applicant or licensee itself by whatever criteria it wishes to use,
4
-6 SEP 8 g7 identifies significant information,
that the reporting obligation of j
paragraph (b) is triggered.
Thus, the NRC will not be penalizin~g under 1
proposed paragraph (b) good faith judgments by licensees that information in their possession is not significant.
The Commission's existing material false statement policy is currently reflected in the general statement of, policy and procedure for NRC l
enforcement actions in 10 C.F.R. Part 2, Appendix C.
To further i
address your concerns regarding practical guidance to applicants and licensees and to provide further guidance and specificity with regard to j
the manner in which the new rules wm be implemented, the final rulemaking package wm include modifications to the enforcement policy J
which will be published concurrently'with the new rules.
I trust that the foregoing information will resolve any misunderstanding i
i and concerns you may have had with regard to the Paperwork Reduction Act implications of the proposed rule and that you will now be able to j
approve publication in final form.
If you have any questions regarding this matter please do not hesitate to call me.
I i
Wmiam G. Mcdonald, Directo Office of Administration and j
Resources Management i
Distribution:
l Mcdonald Rdg i
WGMcDonald JAAmenta WAMagee
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BShelton JGoldberg, OG C SSchinki OGC i
MWagner, OGC i
I
- JGoldberg,!, concurried telephonically for SSohinki on 9/4/87.
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OFFICIAL RECORD COPY
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