ML20237C279
| ML20237C279 | |
| Person / Time | |
|---|---|
| Site: | South Texas  |
| Issue date: | 12/13/1987 |
| From: | Murley T Office of Nuclear Reactor Regulation |
| To: | |
| Shared Package | |
| ML20237C243 | List: |
| References | |
| 2.206, DD-87-20, OL, NUDOCS 8712210220 | |
| Download: ML20237C279 (2) | |
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l 7590-01 UNITED ST ATES NUCLE AR REGUL ATOR Y COMMISSION ;
i D O C K E T N O. 50-498 OL A N D 50-499 OL HOUSTON LICHTING G AND POWER ' COMP ANY (S0!tTH TEX AS PR OJEC T, UNITS 1 AND 2)
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ISSU ANCE OF DIRECTOR'S DECISION UNDER 10 CFR 2.206 (DD-87 20 )
Notice is hereby given that the Director, Office of Nuclear Reactor !
Regulation, has denied a Petition under 10 CFR 2.206 filed by Mr. Lanny- )
Sinkin on behalf of Citizens Concerned About Nuc1 car Power, Inc. The petitioner asked the Nuclear Regulatory Comission (NRC) to reopen the record in the South Texas Nuclear Project licensing hearings based upon the testimony given by NRC witnesses during hearings in April 1987 before the Senate Committee on Government Affairs. The petitioner l
i alleged that the testimony of these witnesses before this Congressional Committee sheds doubt on the credibility of NRC personnel in the South Texas Nuclear Project licensing hearings.
The petitioner's request has been denied for the reasons fully described in the " Director's Decision Linder 10 CFR 2.206." issued on this date, which is available for public inspection at the Commission's Public Document Room, U17 H Street, N.W., Washington, D.C. 20555, and the Local Public Document Rooms for the South Texas Nuclear Project located l at the Austin Public Library, 810 Guadalupe Street, Au:. tin, Texas 78701 and at the Wharton County Junior College, J. M. Hodges Learning _
Center, 911 Bowling Highway, Warton, Texas 77488.
1 8712210220 871213 por e ADOCK 05000498 ,
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A copy of the - Decision will be filed with the Secretary for the
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Commission's review in accordance with.10 CFR 2.206(c). . As provided _ in -
this regulation, the Decision will constitute. the final action of :the j Commission twenty-five (25) days after issuance, unless the Commission, .
1 on its own motion, institutes. review of the Decision within that - time' j period.
Dated at Bethesda, Maryland.this 13th day of December,1987 FOR THE NUCLEAR REGULATORY COMfISSION v .
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Thomas E. Murley, Director '
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Office of Nuclear Reactor Regulation . ,
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UNITED STATES OF AMERICA CXFEfEI l NUCLEAR REGULATORY COMMISSION P "
BEFORE THE COMMISSION g g3 gg IN THE MATTER OF -) ]
( Orr ., j HOUSTON LIGHTING AND ) Docket Nos. 50-498 OTC#i *:
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POWER COMPANY, ET AL. ( 50499 OL " - " '
(South Texas Project, )
Units I and 2) (
INTERVENOR CITIZENS CONCERNED ABOUT NUCLEAR POWER, INC.
, MOTION T,0 REOPEN THE RECORD ;
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- 1. INTRODUCTION On April 9,1987, Senator John Glenn, Chairman of the Scaate Committee on Governmental Affairs, held hearings to examine allegations against Nuclear Regulatory Commission (NRC) personnel.
NRC* witnesses in these hearings presented evidence of serious abuses l i
within the NRC, including evidence of intimidation and harrassraent of NRC personnel in Region IV, the regional office which oversees the South Texas Nuclear Project (STNP). '
Based on this testimony, Intervenor Citizens Concerned About Nuclear Power, Inc. (CCANP) herein moves the Commissioners of the Nuclear Regulatory Commission to reopen the record of the STNP licensing hearings to determine whether, giun the evidence of undue influence exercised over NRC personnel by their management, there is reason to alter the conclusions reached by the Atomic Safety and Licensing Board (ASLB)in this proceeding.
II. B ACKGROUND The ASLB in this procecding has issued three partial initial decisions dealing with various issues in contention. The extensive procedural history of this docket is set forth in those decisions and will not be repeated here. These decisions resolved all contested issues in favor of the Applicants. Final reviews
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s In his opening statement, Senator Glenn expressed his concern about the
' impact of certain management actions on the mission and functions' of the NRC Office of Inspector and Auditor (OIA), the internal NRC investigative unit, and the Office of Investigations (OI), the . organization responsible for the conduct of all investigations involving NRC licensees. Opening Statement of Chairman John Glenn, April 9,1987.
Regarding OIA. Senator Glenn stated that "there are serious deficiencies in OIA's objectivity and investigative practices which have diminished the 1
effectiveness of the office." M. Senator Glenn said his Committee had
" discovered evidence which suggests improper communications between the NRC and licensees concerning the NRC's regulatory activities
- suggesting "that the NRC has been totally incapable of policing such misconduct on its own." M.
Stating tha't 'the NRC is supposed to be 'a watchdog, not a lapdog," Senator Glenn concluded that what he saw in the NRC was " timid controls on internal ,
affairs and troublesome limitations on external investigations." M.
(2) Julian Greenspun, Esquire Appearing as a witness before the Committee was Julian Greenspun, who served fifteen years in a variety of federal prosecutorial positions in the l Department of Justice and who, from 1979 through 1986, served as the Deputy Chief of Litigation in the General Litigation section of the Criminal Division.
In the latter position, Mr. Greenspun supervised the prosecution of criminal i
violations of NRC regulations. ;
I In his testimony, Mr. Greenspun said:
" Based on my extensive experience with the NRC, I car, unequivocally state that I know of no other regulatory or investigative agency, where senior agency officials have taken as many bizarre and seemingly 1
. deliberate actions intended to hamper the investigation and prosecution of I individuals and companies in the industry the agency regulates."
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'On more than one occasion, O!A has avoided identifying and' recommending corrective action for serious wrongdoing and mismanagement by tenior agency officials, while focusing its attention on less important issues."
M. at 2. He further testified that 'the leadership of this office has been a disaster" M. at 11. Mr. Greenspun stated tlaat 'OIA has historically ignored wrongdoing by NRC Staff which benefitted operators of nuc! car plants.' M.
Mr. Greenspun's conclusion was:
"As with the Banking and Securities Industries, effective, vigorous and independent enforcement of the law is necessary to minimize the possibility of a disaster as well [as] promote public confidence in the system. We have no right to expect either with purported watchdogs who are supposed to work for the public, but in reality are 'in bed' with i those whom they are charged with regulating."
M. e 12.
O) Ben B. Hayes The concerns expressed by Senator Glenn and the observ'a tions and opinions of Mr. Greenspun are confirmed by the testimony of Ben B. Hayes, Director, Office of Investigations.
Mr. Hayes testified that *[d]uring the years that I have been Director, Of l
has been in a constant battle to maintain its independence." Testimony of Ben B. Hayes, Director, Office of Investigations, Nuclear Regulatory Commission.
Mr. Hayes recounted an investigation by his office into the presence in a utility file of a confidential NRC document. His investigation determined that the document came from the office of Commissioner Thomas Roberts only four i
working days after the document was transmitted to Commissioner Roberts' office. Pursuant to instructions from the NRC Chairman, Hayes requested Commissioner Roberts to investigate, rather than turning the matter over to O!A. M. at 2 - 5.
.In the hearing, Commissioner Roberts denied the document was leaked to 1
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/ . Lobsenz. Commissioner Roberts agreed to take a two week leave of his' duties !
I at the Commission to prepare his testimony on these issues. E -)
At this time, there are at least five investigations of the NRC underway. .
The Department of. Justice is investigating - possible criminal ' actions by Commissioner Roberts. An internal investigation ordered by Chairman Zech has been turned over to an outside counsel at the request of members of Congress.
The Senate Comniittee on Environment and Public Works Subcommittee on Nuclear Regulation has ordered a separate investigation by the General
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Accounting Of fice. The Senate Governmental Affairs Subcommittee, chaired by l
Senator Glenn, and the House Interior Committee, headed by Representative Udall, are conducting investigations of misconduct by the NRC.
Mr. Hayes further testified that he became aware of an incident in which-the Executive Director for Operations, Mr. Victor ' Stello, called .a utility
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executive to coach the executive on how to respond to an NRC: demand for information. Mr. Hayes took the matter to the NRC Chairman and then to the-Director of OIA for possible investigation. OIA concluded there . was - no misconduct after conducting a cursory luvestigation. Hayes Testimony at 5 - 7. ,
i Later, when Mr. Hayes presented NRC Chairman with a recommendation l that the Commission appoint a senior executive to take responsibility for the TVA project, which Mr. Hayes viewed as disorganized, Mr. Stello threatened i
him and senior NRC staff met to discuss how to do " damage control' regarding- ;
his suggestion. E at 8.
Mr. Stello later instituted internal procedures to minimize the number of allegations that would reach Mr. Hayes for possible criminal prosecution. E at 8 - 9.
The Commission itself has interfered with Mr. Hayes work by requiring-
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l inspection reports or otherwise made changes without consulting or even informing the inspectors. M. In one case, Region IV ananagement issued a final i inspection report different from the draft report and attached the signatures of the inspectors from the draft to make it appear that they had approved the changes. M. Mr. Mulley learned of one inspector transferred and later demoted for having a strong regulatory enforcement attitude. M. at 4.
These abuses were not confined to Comanche Peak but occurred at other Region IV plants. M. A former Division Director at Region IV told Mulley:
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"I did not consider that Region IV had a strong enforcement program, and I believe that a lack of a strong enforcement program has its roots in the attitudes of the senior managers."
M. at 9. This same NRC official told Mulley:
"I personally believe that the attitude of Region Four management was not to do more work which would cause more problems for the utility."
M.
In a revealing part of his testimony, Mr. Mulley noted that he tried to keep his investigation secret because, in his words, "if NRC managers, both in Washington and at the Region, learned the full scope of the management problems being reised in Region IV, my investigation would be interfered with."
M. In fact, he was forced to reveal his investigation to his superiors because the Region IV Administrator, Mr. Robert D. Martin, was planning to remove Phillips from the site because Phillips had convinced others t,o cooperate with the investigation. M. at 5.
After the investigation was revealed, Mr. Stello began pressuring Mr.
, Mulley to complete his investigation. As a result, Mr. Mulley testified, he "had no choice but to limit this investigation to the specific concerns originally raised by Phillips and icnore. for the time beine. the other witnesses' comolaints of Reeion IV's reeulatory t.11smanneement of other
~o lants and the evidence of harassment. intimidation. and oressure on other insoectors.
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'. came forward to reveal agency wrongdoint.
As of the time of his testimony, Mr. Mulley was 'not aware of any corrective action the NRC has taken to deal with the management prob 1 cms in I Region IV." M. at 9. l Mr. Mulley concluded: 3 "the problems brought to OIA by Shannon Phillips and others are extremely serious. The integrity of the regulatory process cannot be ;
assured if the regulators become the defenders and protectors of the !
utility they are supposed to regulate." !
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(5) H. Shannon Phillips H. Shannon Phillips, currently Senior Resident Inspector for Construction at the Comanche Peak nuclear power plant in Texas, testified' regarding his personal experiences with intimidation and harassment by the management of NRC Region IV.
Mr. Phillips testified that Region IV supervisors
" consistently suggested that we remove certain negative findings about the plant or that we ' downgrade' violations to the category of findings called ' unresolved items."
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Statement of H. Shannon Phillips Before the Senate Committee on 1
Governmental Affairs, April 9,1987 at 3. One supervisor articulated his reason for this pressure by stating 'he was there 'to license the plant." M. Mr.
Phillips believes that "the basis for the intimidating conduct was my management's concern that negative inspection findings might reflect unfavorably on the licensee's performance and reduce their chances of getting a licens [ sic)?
M. Mr. Phillips testified that he was " pressured, badgered and ultimately threatened" if he "did not remove negative findings from inspection reports."
M. a t 5.
Mr. Phillips further testified that "recent actions had convinced me that 11 l
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4 hearings.) Regarding the Zimmer plant, Mr. Greenspun stated (Tr.129):
"For years NRC inspectors were finding serious problems at the Zimmer plant in their inspections, and were told by the regional office in Chicago not to write it up and in reports, but to keep a little notebook of violations he was finding. So,' if the inspector' got hit by a truck, nobody would know about the violations."
Detailed Appendix' to Written Statement of Victor Stello, Jr., Executive Director for Operations at 5. This statement by Mr. Greenspun' identifies this particular problem as more widespread in the agency than simply in Region IV, as testified to by Mr. Phillips. See sho " Investigative Interview" below.
Second, Mr. Stello stated that the NRC would cooperate - with . the Department of Justice, even to providing assistance in' investigations, but that such cooperation
reduces the limited resources availabic to us for carrying out our mission of protecting public health and safety. Thus, we have fewer investigators and inspectors to pursue issues directly related to our health and safety
. mission.'
Id. at 2. It is clear from Mr. Stello's testimony that he has created in his mind the concept that prosecution of criminal activity at a nuclear power plant is not necessarily directly related to protection of public health and safety.
Apparently, Mr. Stello is unfamiliar with the requirement that NRC licensees have adequate character or choses to ignore that evidence of criminal activity at a nuclear plast could well reflect a lack of character.
Finally, Mr. Stello confirms that with Commission approval he released the Mulley report to the key people under investigation without taking steps to protect the identity of witnesses. Id. at 16 - 17.
l (2) Investigative Interview CCANP is in possession of a copy of a $7 page Investigative Interview conducted by Mr. Mulley at a Ramada Inn on June 24, 1986 [ Hereinafter
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"In terview"). The name of the witness is deleted. -CCANP assumes this 13
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i utility, they would tend not to take strong enforcement action, M.1 and
- when senior management felt frier'dly toward the utility, they let these feelings be known and their views discouraged notices of violation being written by the individual inspectors. M. at 4.
The witness reiterated the last point in discussing how regional management would pass on their attitudes to the inspectors. The witness stated in part:
"one of the very favorite approaches to discourage inspectors in writing violations and writing reports on those violations is to worry their work '
, , . product to death and question it to a great extreme."
, M. at 10. This attitude
' simply meant that the inspector would be discouraged from writing notices of violation because he had to jump through so many hoops to-get it out.
M. .
The witness stated that there was a tendency in Region IV to call a violation an open iten2 as a " trick to not call a violation a violation," which provided a means of correcting a violation without any violation ever appearing in the record of the plant. M. at 42 - 43.
The accumulation of open items led to pressure to close the items. The
( witness stated:
"There's no doubt in my mind there were some players on the stage that meant get it done if you can get it done right. If you can't get it done right, do it anyway."
M.at$1.
Regarding Mr. Phillips, the witness testified that he or she received advice tot to call upon Mr. Phillips. M. at 17 - 19.
"There was a continuing stream of comments about watching Mr. Phillips and not trusting Mr. Phillips and watching your back with Mr. Phillips.
Most of that I concluded was based uoon his cerrormance at South Texas and his involvement with Region Three eersonnel who did a soecig -
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. l not written up as violations. For example, one evaluation of 16 proposed violations downgraded to unresolved (i.e. open) items found that for 9 of these allegations ' there was either sufficient information caisting to impose a 4 violation or that NRC management's rationale for downgrading or othewise treating the violation was questionable. Report at 33.
The report concluded that 'it would not be possible to rely on the Region IV QA inspection effort as evidence of the safe construction of CPSES
[ Comanche Peak)."Id. at 46.
IV. MOTION TO REOPEN .
A. The Integrity of the ASLB Hearing Process The picture that emerges from these hearings and the related documents is of an investigative process corrupted by a pro utility / anti intervenor 1 e.ttitude which produced acts of interference, intimidation, harassment, obstruction, and even possibly criminal acts by NRC national and regional management. The internal NRC mechanism responsible for detecting and correcting just such acts was itself subject to corruption of its Icadership and obstruction of its functions. Both the corruption of the investigative process and the c:orruption of the internal audit process provide a basis for reopening the record in this proceeding to determine whether the attitudes and actions which now stand revealed infected this proceeding. '
An objective reading of the opinions delivered by the ASLB in this proceeding shows that the Board relied very heavily on NRC Region IV i
inspections and investigations, NRC reports and evaluations, and NRC opinions.
i The Congressional testimony and related documents call ir.to question the !
accuracy and objectivity of those NRC documents and testimony. There is a need to examine the preparation of documents and testimony by NRC witnesses 17 i
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The opinion offered by the panel is presented as representing the views .
of the NRC Staff as a whole. Tr. 9874, L.18 - 9875, L. 7.In explaining their reasons for this conclusion, the panel expressed their view that the management of HL&P had not been irresponsible. Shewmaker, Phi!!ips, and Hayes, ff. Tr. 9576 at 49.
As part of the basis for the panel's opinion et whether HL&P was Irresponsib!c, Mr. Phillips cited the enforcement record of HL&P, particularly l
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. . the lack of severity of HL&P's noncompliance as recorded by the NRC. Tr .
9851, L.1 - 9853, L.23.
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in rendering their general opinion on the character of HL&P, the NRC Staff panet used compliance of HL&P with the regulations and requirements of j
the NRC as the standard for determining character. Tr. 9723, L.9 9726 L.'2.-
All thtree witnesses agreed that, based on the existing record of HL&P compliance with NRC requirements, they would assess HL&P's performance as
' poor.' Tr. 9726, L.3 - 9727, L.16.
The ASLB agreed that questioning was permissible to clicit how poor a -
record would have to be before an applicant was disqua!ified. Tr. 9719, L 8; Tr. 9728, L. 8 - 13. ,
4 When Intervenor CCANP attempted to cross examine the panel in an effort to determine the basis for their 'not so poor" conclusion, these efforts
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were systematically frustrated by multiple objections and adverse Board rulings, )
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but there is sufficient indication in the record to conclude that the opinion '
itself might not have withstood close examination. $st Tr. 9728, L.19 - 9919 ,
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and character to operate the South Texas Nuclear Project safely. In its Partial Initial Decision issued on March 14, 1984, the Board found that the record was insufficient to a!!ow the Board to determine whether HL&P possessed sufficient managerial competenc' c to warrant the issuunce of an operating license. (LBP-8413,19 NRC 659, affirmed in es t ALAB-799, 21 NRC 360 (1984), review declined by Comm{gion), letter dated July 30,1985.
Since the Phase I record could not reflect the performance of the -
Applicants and their new contractors on the Project,~ the Board required the -
3 Staff to provide a report.concerning the performance of HL&P, Bechtel, and Ebasco at STNP since the close of the Phase I record. This report was to !
include violations, if any, of applicable regulatory requirements and the Staff's evaluation of the adequacy of implementation of the .QA/QC program for construction. Id. at 697, 700. i The Board decided to consider the Staff affidavit I and Applictnt affidavit prepared in response to this directive as a motion for summary disposition. Memorandum and Order (Telephone Conference Call of April 4,1985), dated April 5,1985 (unpublished). CCANP filed its response on April 25,1985. S31 Citizens Concerned About Nuclear Power (CCANP) Respon to Applicants and Staff " Motions for Summary Disposition [*] dated April 25 .
1985. ,
In its response, CCANP examined the open items and items opened 'and closed in the Inspection and Enforcement Reports for STNP. Based on that examination, CCANP registered *its strong belief that the NRC Staff has grossly abused the use of 'open items' to avoid writing up violations." CCANP argued that various currently open items and items opened and closed raised genuine issues of fact 'regarding the competence of HL&P and its contractors and/or the' efficacy of their QAjQC program which should result in denial of 21
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42107 OL, dated June 13,1986 at 52 $3.
4 But the Board concluded:
'We have been given no persuasive reason to indicate or suggest that the NRC has been abusing this system."
M. at 53. The Board added:
5 "In any event, a licensing proceeding is not an appropriate forum for challenging the Staff's methodology for carrying out its functions, gi least in the absence of a showinn (not made here) that the functions are inconsistent with regulatory requirements or were performed other than normally for the particular plant under review.
regarding For these reasons, we are giving weight to the affidavits' statements-4 - the number. and significance of violations and deviations-attributable to HL&P during the period under review."
M. at 53 - 54 (emphasis added).
In granting summary disposition on tne issue of current competence, the Board relied on the Staff affidavit and, in - particular, on the record of violations as recorded by the Staff. M. at 60; Id. at 228, see esnecially Findings 685 -68 7.>
Thus, CCANP attempted to raise the precise issue so clearly docuc2ented in the Congressional testimony and related documents. CCANP raised this issue without benefit of any discovery to establish its contention. While absent such discovery CCANP may have failed to persuade the Board that a significant issue existed, this new evidence satisfies the threshold test as to whether there is adequate evidence to admit CCANP's contention for litigation and constitutes the showing the Board sought when CCANP first brought this issue to their attention.
The issue itself arises from a possible deliberate attempt by NRC personnel to hide inforrnation from the Board and the Intervenor. To deny reopening would be to continue this process.
CCANP specifically moves the Commission to reopen this proceeding for 23
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1 The standards for reopening require three criteria to be met:
j I. The motion must be timely filed;
- 2. The motion must address a significant issue;
- 3. The motion must demonstrate that the information sought to be added l to the record might potentially alter the result the Board reached in its absence.
In this instance, timeliness is hardly a factor. The hearings were held on April 9. To CCANP's knowledge, the transcripts are still not available to CCANP. Given the impending fuel load, CCANP decided the motion should be filed even before all possible evidence is available. Filing the motion within six weeks of the hearings, even were the transcripts available,is certainly timely.
Furthermore, the gravity of the issues sought to be litigated far outweigh any possible concern as to the rapidity with which the Intervenor br'ought the. 1 issue to the attention of the Commission. Moreover, the Commission is l
certainly aware of every issue raised in this motion, save periaaps the detail of CCANP having tried to raise the open item abuse contention earlier. That the Commission did not direct the reopening of all proceedings in Region IV to determine whether the evidence developed by Congress warrcnts a reevaluation of the decisions in those proceedings is a failure by the Commission. ,
f As to the significance of the issue, there could hardly be a more significant issue. If the ASLB relied on testimony . based on inaccurate investigative reports, on evaluations and opinion developed under duress, and on testimony delivered in an atmosphere of intimidation, the opinion of the ASLB is worthless. Since that opinion affects directly whether a nuc! cur power plant will be turned on or 'not, the gravity of the issue is of the highest magnitude, f 25 I
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4 that so c!carly permeate this entire agency.
Nevertheless, CCANP is pursuing this motion under the exhaustion of remedies requirement in the law in the hopes that somehow the Commission will accept responsibilities for its actions before it is too late for the people of South Texas. Given the knowledge CCANP has about the management, construction, and inspection of this project, we can do no less.
At the same time, CCANP does not view the Commission as having the discretion to deny this motion. Given the evidence available, the seriousness of the corruption revealed, and the direct relevance of this information to the decision reached by the Commission in this proceeding, CCANP views reopening as a mandatory act for the Commission.
The people of South Texas deserve no less. They have relied on the 1
Commission to protect their health and safety. They have believed . the assurances of the Commission that this function was being performed. Now l they know their reliance was misplaced and that the assurances are lies. They deserve to know the whole truth and to be reassured that STNP is either safe or denied permission to operate.
Respectfully Submitted.
Lanny Alan Sinkin Counsel for Intervenor Citizens Concerned About Nuclear Power, Inc.
Christic Institute 1324 North Capitol St. N.W.
Washington, D.C. 20002 (202) 797 8106 Dated: May 29,1987 27
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STATEMENT OF GEORGE A. MULLEY, JR.
BEFORE THE SENATE COMMITTEE ON GOVERNMENTAL AFFAIRS APRIL 9, 1987:
My name is George A. Mulley, Jr. I am the Assistant Director for Investigations at the Nuclear Regulatory Commission's Office of Inspector and Auditor (OIA). OIA investigates to ascertain the integrity of all NRC operations
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I and, among other things, investigates allegations of NRC employee misconduct.
I am testifying today pursuant to a letter from the Committee to Commissioner Zech requesting my appearance at this hearing. On March 20, 1987 I was deposed under o'ath by counsel to the Committee. My presence at the deposition was a result of a written notice from the chairman. Subsequently, I had the opportunity to review the transcript of my deposition. This testimony is a summary of sworn statements made at the deposition.
I have been asked to testify today about an investigation.
that I conducted last year concerning allegations of intimidation and harassment 'of NRC employees by their superiors in Region IV -
(Dallas) for reporting safety problems.
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The particular nuclear plant involved was Comanche Peak, which is owned by Texas Utilities Electric, has been under construction for 14 years.
The Comanche Pcak plant is not yet licensed to operate. I have also been~ asked to testify about the process by which the results !
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of my investigation were reported to the Commission.
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. regulations in the construction of Comanche Peak. It was his, belief that~Jthe~co~ndition.cf the Comanche Peak plant was indetermi'nate and that Region IV had not properly inspected the' plant or enforced federal regulations over the plant's 14 year construction history.f Additionally,. Mr. .Phillips sta'ted that he' had been harassed,-
intimidated and pressured.to remove proposed findings from draft.
inspection reports by downgrading them to a less serious issue or-k deleting them entirely'ff6m the' report Mr. Phillips provided 1 evidence that when he and other inspectors resisted downgrading or deleting at least 30 proposed findings, the Director of the s
Comanche Peak Task Group, Thomas Westerman, and another manager, Eric Johnson, removed violations from the inspection reports or substantially changed the report without the inspectors' knowledge and other times without their concurrence. In one case the Region issued a final inspection report using the signature page from a draft version of the report. This r e it appear i
that the inspection report was approved by the inspectors involved --when actually the inspectors were neither informed of the changes nor told of the issuance of the report.
I believe Mr. Phillips' a'llegations were exactly the types of concerns that should be thoroughly investigated by an independent investigator within the NRC without regard to the 1
potential consequences of the investigation on the licensability of a nuclear power plant.
7 The evidence showed.that'the attitude of Region IV' management was to create no further problems for Texa's#
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. Administrator of Region IV was going to remove Phillips from tha plant site.
Mf.~ Robert D. Martin, Regional Administrator, stated during a conference call with me and Sharon Connelly, the- -
Director of..OIAf_that he was going,to remove Phillips from the site because Phillips was getting other people to cooperate'wi*th the OIA investigation, and had therefore lost his objectivity: I believed that this proposed action constituted a reprisal.for Phillips initiating the OIA investigation and I got NRC headquarters to stop the transfer. However, at that point the \- l
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confidentiality of the investigation was compromised.
From that point forward I was under pressure from Victor' Stello, the Executive Director of Operations, to complete the - 1 i
investigation and then to write the report.
l Given this pressure I felt that I had no choice but to limit this investigation to the specific concerns originally raised by Phillips and ignore, for the time being, the other witnesses'
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complaints of Region IV's regulatory mismanagement of other -
plants and the evidence of harassment, intimidation, and pressure on other inspectors.
The pressure came not only from the Executive Director of the NRC staff, but also from my supervisor, Sharon Connelly. In late July of 1986 I finished the field work.- In September.and i October 1986, while I was trying to write the report, the ,
i pressure being put on me by Connelly was so great that I asked '
her for a meeting with Chairman Zech to determine if the pressure was actually coming from the Chairman's office, as she i said it was.
Chairman Zech assured me that there was no reason " 'l l
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I do not recall any prior occasion where Sharon Connelly took such an active role in the preparation of one of my reports.
For the first time in my career as an OIA investigator, shg assigned a group of OIA auditors to rewrite the ' report.- She also removed many of the statements .f rom. Region IV' managers w!iom I had e
! quoted.. The statements substantiated the conclusions I had reached and demonstrated the lax enforcement attitudes of -
Regional management. For example, when I asked Eric Johnson'how the agency would go about at this late date trying to verify that Comanche Peak was built safely absent all the necessary quality assurance inspections and records, he responded, "We shouldn't
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worry about the past, and you just go out and kind of kick the tires and if it feels good, you go on from there."
Another' example was the removal of the explanations made by.
Thomas Westerman'about why he was being very " tight" on issuing violations at Comanche Peak, more so than at other plants. He said that proposed violations, unless " absolutely correct", would
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creat a lot of " unnecessary paper work" and could lead to his credibility as a witness being question *d during NRC hearings.
I thought that these quotations reflected, more accurately than my words could, a misconception of their responsibilities a's regulators. Connelly removed the quotations because she said they were " inflammatory", and OIA could be criticized for taking things out of context. However, I had been very careful to put both the context and the references in my draft report. I i
believe that by removing the conclusions and the quotations connelly d'ownpla'yed the severity of the Region IV management -
)
i a ,. ;
,',.,
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cther ongoing investigations of Region IV management. .!
l I am not, aware.of any corrective action the NRC has taken to deal with the, management problems in Region IV. On the other hand, within days of the repert's release, Tom Westerman was awarded a monetary bonus for his work at Comanche Peak. I informed the EDO,'s office of my concerns about the inappropriateness of this action. It is my understanding that a stop-payment was placed on the check.
In conclusion, I would like to say that the problems brought' to OIA by Shannon Phillips and others are extremely serious. The-integrity of the regulatory process cannot be assured if the -
regulators become the def enders and protectors of the utility they are supposed to regulate. One former Division Director at Region IV I interviewed stated:
I did not consider that Region Four had a strong enforcement program, and I believe that a lack of a strong enforcement program has its roots in the attitudes of the senior managers.
He confirmed that the lack of negative inspection findings could be seen as the attitude of trying to help TUGCO get their j license. He said,
. ...I personally believe that the attitude of Region Four management was not to do more work which would cause more < !
problems for the utility.
The Commissioners needed to be informed of this attitude and its alleged specific consequences at Comanche Peak and other nuclear plants regulated by Region IV. Shannon Phillips tried to do that and is now fight'ing to save his career.
What happened to this investigation is an example that 1 i
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l STATEMENT OF JULIAN GREENSPUN, ESQ. 1 E2 FORE THE SENATE COMMITTEE ON GOVERNMENTAL AFFAIRS I APRIL 9, 1987 )
My name is Julian Greenspun. Although I am now in privete practice, for the past fifteen years I have held a variety of federal prosecutor positions in the l U.S. Department of Justice. From 1979 through 1986; I s'eEved as,;,the_C,epu,ty. Chief of Litigation in the General 1V
'LitTyationasect, ion of the_ Criminal Division.< In this position I supervised thirty attorneys who prosecuted criminal violations of regulations promulgated by such agencies as the Nuclear Regulatory Commission (NRC), l Mine Safety Health Administration (MSHA), Occupational Safety and Health Administration (OSHA), and many others. j l
I spent a significant portion of this period handling i a supervising potential criminal cases related to the commercial nuclear industry, including certain aspects of the Three Mile Island criminal case.
Based on my' extensive experience with the NRC, I-can unequivocally state that I know of no other regulatory or investigative agency, where senior agency officials have taken'as many bizarre and seemingly deliberate actions
. in' tended,to hamper.the investigation and prosecution-of Individuals'and companies in the industry the agency re'g'uia t e s '.
l _ _ - _ - _ - _ -
j I
NRC's unseemly protection of the industry from necessary i j
)
investigat, ion,s of deliberate: wrongdoing. Unfortunately, l I cannot reveal all of the details of these cases because I
some of the information is protected by grand jury secrecy restrictions, and because I have not been able to obtain copies of essential documents I left behind in my Department l files to honor these restr.ictions.
At the outset I can say that on more than one occasion when wrongdoing was under investigation by the Department, j senior NRC officials, and perhaps even some Commissioners had ex-parte meetings or discussions concerning the subject j matter of the investigation with those under investigation.
l l On at least one occasion, I personally requested that a senior NRC official not meet with the licensee under i investigation. Despite my importuning, shortly thereafter l
the official engaged in a ler.gthy discussion with the target of the investigation. His action unnecessarily l derailed criminal prosecution, a fact which I believe l
l was known to those conducting the meetings.
One example of the NRC's obfuscation of a major criminal violation occurred at the Three Mile Island plant. Furthermore, i believe this violation nay have been a contributing factor to the eventual melt-down at that plant. NRC regulations required that if a reactor 1
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was scheduled to appear on television did the NRC report f l
these allegations to the Justice Department. Subsequently, j the allegations were ve,rified by the independent analysis of experts and the testimony of an NRC inspector at the I
site.
Despite this, certain senior.NRC officials continued ,
i to insist that the utility's conduct at THI war accepta' ole.
)
i They adopted the utility's position that (1) nothing !
i prohibited the addition of water to the reactor, (2) there was nothing wrong with the destruction of " bad" leak rate tests, and (3) it was difficult to tell a " good" test from a " bad" test. It is my belief that these officials {
l actively misled and even lied to the Justice Departments
{
1 in the TMI case. Perhaps most revealing, in a meeting with myself and other prosecutors, Mr. Stello, now Executive i
Director of the NRC, said that an investigation at TMI would be bad for the operators morale, and: "Nobody is going to tell me how to treat mv licenrees." It is that attitude which must be dispensed with through changes such as this legislation.
The end result of the TMI matter, of course, was the criminal conviction of the utility for violating i NRC regulations. See United States of America v. Metropolitan Edison Company, CR. No. 83-00188. To demonstrate to x__-_____________-_ _ ___. _ _. _
l I didn't see the NRC hustling to clean up the loose ends and to make it known to.the public just
, what went on in 1978 or 1979. We...made a Herculean i
effort to get to the bottom of the facts, something that was not done by the Nuclear Regulatory Commission.
As recently as six weeks ago, as I was about a
to say, they voted basically to proceed with a Unit-1 license restart application irrespective of the outcome of these criminal proceedings.
New I realize this is of secondary significance to whether the Court ought to take a plea, but Mr.
Curran (TMI's lawyer) seems to raise the issue that we are not to worry if there are any loose ends here today because the NRC will take care of it. I It is utterly delusional.
The NRC doesn't care what is in the indictment; they have said so. They don't care what the outcome of this case is; they have said so. They are going to proceed and do whatever they want to do, and that is fine because I have ne control over the NRC, nor does the Attorney General or anyone else in the Department of Justice. But the statement of the facts as r.ead by me a short time ago are
' precisely the correct statement of what took place.
w
t 1
i the NRC who could' affect or influence OI's ability /
to., detect and. report ~ violations if it were realigned f i may_have contribu,ted,to this problem." l The legislation proposed by Chairman Glenn would statutorily end the possibility of moving OI. I believe this is a vital step to insure that OI will remain independent, and that wrongdoing will be detected.
The final example I would like to share with the ;
1 Committee does not concern a particular criminal case; .
i it is the proposed Advisory Committee on the Rights of 1 i
Licensee ~s, which the NRC tried to establish in 1983.
Those behind the establishment of an Advisory Committee j i
sought to notify companies in advance that investigations j were being undertaken, and allow utility lawyers to attend i all meetings between NRC investigators and company personnel.
These and other proposed restrictions would have gone ,
well beyond what the Constitution and federal law require i in the way of due process for targets or subsections i
! of investigations, who would, no doubt profit handsomely by insinuating themselves into interviews of employees. !
This (effort, under the guise of an-Advisory Committee),
would have carried the special relationship between the NRC and its licensees to preposterous lengths. It was merely a front to protect the utility companies from
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1
'l the inadequacy of the NRC's* Office of Inspector and Auditor',
the putative inspector general's office. The leaderfhip' of ' this'b'f fl~c'e %aTbEen~E; disaster; ' one Director of that of fice was ef fectively dismissed only af ter.an embarrassing court decision cast doubt upon his integrity. .The current head of the office has been the subject of a criminal referral to the Justico Department. The Department's i i
correspondence in that case casts doubt upon her integrity J
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and judgment, (See, Letter from J. Greenspun to S. Connelly, February 7, 1986; Letter from L, Lippe to-H. Plaine,
- March 2'1, 1986; and Letter.from L. Lippe to L. Zech, Jr., October 1, 1986.)
OIA has historically ignored. wrongdoing by NRC staff
- which benefitted operators of nuclear plants.' This indicates to me that they are not investigating matters of importance, or at a minimum, are not conducting these investigations in a sufficiently professional manner.
l I am convinced that a statutory I,G. who has the independence to look will find real wrongdoing at NRC, as other I. Gs. have found at their agencies. I believe ;
4 there is a need for a statutory inspector general at !
l
. the NRC which would aggressively audit and investigate all of the NRC's programs and activities. . Fundamentally, such legislation would ensure that all senior agency i
s_-____-_--__-_____. __ . _ _ _ _ _-.
STATEMENT OF H. SRANNON PHILLIPS BEFORE THE SENATE COMMITTEE ON GOVERNMENTAL AFFAIRS APRIL 9, 1987 i
My name is H. Shannon Phillips.- I am the Nuclear Regulatory Commission's Senior Resident Inspector (SRI) for Construction at l the Comanche Peak nuclear power plant in Texas. .I am part of the Region IV staff.
I am testifying today pursuant to a letter from the-Committee to Commissioner Zech requesting my attendance here s .
today. My loyalty is to the NRC. I did not seek to testify but am here pursuant to the Committee's request.
{
I have been asked to testify about recent events regarding Region IV's regulation of Comanche Peak and particularly how these events have destroyed my career. '
l I have been an NRC inspector for over 10 years; before that I worked as a materials scientist and quality assurance division nanager in the aerospace industry. I am a materials engineer by.
training and degree.
As a Senior Resident Inspector at the Comanche Peak nuclear power plant, it is my responsibility, by law, to conduct inspections for purposes of determining whether Texas Utilities 1
[ is constructing the plant in accordance with NRC regulations and other legal requirements.
In 1985 I repor,t,ed to the. Chief of the Region IV Comanche' Pe ak ' Ta s k G r'o'dp~'Tioma s~F'." We s t e rma n~,a nd h i s ' a s s i s t a n t , Ian, !
Barnes. Westerman and Birne~s' reported to~the Division Dir'ector, Eric Johnson,'who in turn' reported to the' Region IV ' !
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program at Comanche Pitak:
Although the TUEC QA program documentation met NRC's requirements, the weaknesses of its implementation demonstrate that TUEC lacked the commitment to aggressively implement an effective QA/QC program in several areas.
4 (List of specific areas omitted.)
(January 8, 1985 letter from Darrell Eisenhut to Michael Spence, President, Texas Utilities.)
That month Texas Utilities withdrew its request for fuel i
l loading.
1 From late 1984 to September 1985 I and other inspectors were permitted the organizational freedom to identify deviations and violations at the plant, and did co. During this time period I was under the direct supervision of Doyle Hunnicutt, Section j Chief, who reported to Dorwin Hunter, the Branch Chief, and Mr.
Hunter reported to Richard Denise, the Division Director.'
In the fall of 1985 Mr. Denise resigned, and Hunter and Hunicutt were replaced by Westerman and Johnson, respectively.
The effect of the new appointments was immediately apparent.
Westerman and Johnson began to challenge my inspection findings, l l
and those of other inspectors and consultants assigned tot Comanche Peak. Westerman consistently suggested that we remove' certain negative findings about the plant or that we " downgrade" violations to the category of findings called " unresolved items."
Westerman's motivation for these actions was, according to 1
his own statements, that he was there "to license the plant.7 Ib is my belief ~this the basis for the intimidating conduct was myr management's concern that negative inspection findings might' i reflect unfavorably on the licensec's performance and reduce >
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. and no duplicates: 1' o A tiehd' analysis of all Region IV negative inspection findings from 1974 to 1984 showed adverse trends in Texas Utilities' quality assurance program for design and j I
construction of Comanche Peak, which TU should have been I
required to analyze.
Some of the harassment during this time period was subtle,
]
such as comments by my supervisors that " Don't you make quite a bit of money, don't you?...." I took that statement to mean that
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if I did not buckle under to Westerman's instructions I could I lose my job. On another occasion Westerman made the comment that Region IV "would never forget" inspection report 8432, an inspection into the failures of the management of TU's corporate l QA program.' I was also told by Westerman that it would be betYer' if I found a'nother job, outside of Region IV.
Region IV management officia2.s also began to " nit pick" me.
For example, I was asked for strict accounting of my whereabouts-and my time on the site. This is out of the ordinary for a resident inspector. I was also asked for explanations and justifications on the most minor details of the inspection work I was able to do.
Throughout the fall of 1985 Tom Westerman conducted a series of meetings on inspection reports in which he pressured, badgered ,
and ' ultimately ~. threatened; me (f _I did not remove negative findings from' inspection' reports. 'One meeting in late November 1985, on control of design and construction records, lasted approximately five hours. I was directed to change many of sy.t
I 1
George Mulley of CIA because of his personal reputation for '
professionalism, but that I doubted the ability of the office to probe the full extent of the management problem and to recommend necessary corrective actions.
]
In April 1986 I met with Mr. Mulley and provided him with- )
detailed information and substantive evidence about my original i lI findings, the actions of Region IV management in removing the findings, and the harassment and intimidation to which I was subjected.
. l I also' told Mr. Mulley of incidents of harassment, l
intimidation and other negative personnel actions taken against.-
other Region IV staff who had raised serious quality designe I and/or construction questions about other Region IV plants /
1 -
Over the next few months Mulley, working alone, conducted his investigation. During this time period I felt isolated, my secretary was reassigned and I was excluded from most Region IV staff meetings.
1 In May 1986 a consultant at Comanche Peak hired by the NRC i came to me and complained that, among other things, Westerman had steered the consultant group away from quality assurance issues !
and that certain NRC inspections were deficient. I told him that he should talk to OIA.
Soon thereafter I learned I was going to be removed from my-job at the site for asking the NRC consultant to provide information to OIA. I wen,t to Mr. Mulley and although he was l able to stop my transfer of f-site, the intimidation and isolation increased. I was told not to talk to NRC consultants, and.I was !
um_____________________________ _ _ _ _ _ _ _ . _ _ _ _ _ _ _
3 of the impa.ct:,that'.the. truth will have on the licensing of a-plant.)
Unfortunately, my experience is that OIA has very little, if any, credibility among NRC employees, and that something must be done to give employees an avenue to bring up these types of concerns. I think an independent inspector general is necessary to monitor the NRC management system to assure the integrity of the regulatory process, including the protection of inspectors like myself.
This concludes my testimony. I am prepared to answer questions the Committee may have on my experience at Comanche Peak.
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s TESTIMONY OF BEN B, HAYES DIRECTOR, OFFICE OF INVESTIGATIONS UNITED STATES NUCLEAR REGULATORY COMMISSION My name is Ben B. Hayes. I was appointed the first permanent director of the NRC Office of Investigations (01) in February 1983. I came to the NRC after 17 ,
years of criminal investigative experience with the Internal Revenue Service, Crirninal Investigation Division. My last assignment prior to coming to the NRC was as Chief of Criminal Investigations for the Cleveland District which covers
., Northern Ohio, 1
1 On March 26, 1987, I was deposed under oath by Mr. Stephen Ryan, Counsel for the Majority in the Senate Government Governmental Affairs Corrnittee. My appearance at that deposition was as a result of a written request from Senator Glenn, the Cocraittee Chairman rather than on my own initiative. I subsequently was afford-ed an opportunity to review the transcript of my deposition. Over this past
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weekend, I was informed that the Committee would like me to summarize the infor-mation that I provided during the deposition, and sponsor this summary as my testimony today. I was not able to complete my review of this testimony until I returned from leave yesterday. I would like to emphasize that the opportunity to provide my testimony, either during my deposition or here today, is not a privilege that I particularly sought. To the contrary, it was thrust upon me. '
Nonetheless, the information that I have provided to the Committee Staff, and which I am summarizing today, is truthful and as accurate as I can make it.
O! is the NRC organization responsible for the conduct of all investigations evolving NRC licensees, licensee vendors, and other persons or entities over e ich NRC has jurisdiction. The office is staffed with investigators having a broad range of experience gained with other Federal investigative agencies such
. as the Federal Bureau of Investigation, the Drug Enforcement Administration, the Internal Revenue Service, the Naval Investigative Service, and the Army Criminal Investigations Division. 01 investigations that uncover or document wrongdoing that appears to violate criminal statutes are referred to the U.S. Department of Justice. Investigative reports are also sent to the NRC official who requested the 01 investigation 50 that the NRC may take any necessary actions to protect the public health and safety.
I felt that the documents indicated that Middle South (the holding company for LP&L) had a source directly inside the NRC, especially inasmuch as the documents came from the files of Commissioner Roberts. Particularly startling was the fact that the document was received in Commissioner Roberts office on Thursday, June 9,1983, and was transmitted by Mr. White of LP&L only four workino days later, June 15, 1983. The memorandum was important as it dealt with a base mat issue which was under active review by the NRC staff, and that it reports collusion with the licensee on the part of NRC personnel, a very serious alle-gation in my opinion.
The document also notes that LP&L may have withheld information on the base mat
. cracks from the NRC. 01 subsequently initiated an investigation of that issue.
For a licensee to know that the NRC was discussing the issues of possible collusion and the base mat issue would give them a tremendous advantage. This l
is an example of someone within the NRC tipping a licensee of a potential inves-tigation. There have been instances where senior managers have tipped the fact
~
that they intended to refer a matter to 01 for investigation, or advised licens-ees as to how to respond to an official inquiry by the Comission.
Af ter leaving copies of the document at the Waterford Site, we returned to Wash-ington and consulted with other members of the O! Headquarters staff. Having concluded that the document in question came from the Office of Commissioner Roberts, based on various markings contained on the documents, I saw two options: take it to the Director of the NRC Office of Inspector and Auditor, or take it to the Chairman of the NRC. I elected to take the matter to the Chair-nan who at that time was Nunzio J. Palladino.
' met with the Chairman and the Chairman's Executive Assistant to share the er cument with them, and to explain how it came into the possession of 01. Chair-ran Palladino asked a few questions about the circumstances, including whether I had discussed the matter with Commissioner Roberts. The Chairman asked me for my recommendation and I responded that the matter should be referred to the Director of_ 01A. On March 14, 1985, I received a one page memorandum from the Chairman that was hand delivered to my office. That memorandum directed me to discuss the matter with Commissioner Roberts as soon as possible, and stated that the Chairman had given Commissioner Roberts the copies of the documents that I had provided him. The memorandum also stated that the reorganization m .
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.s.
. The leaked document was definitely not the type of document that is publicly released. I would have objected if the document were proposed to be released to the licensee within 7 days of it being provided to the NRC Staff. I have never ~
before seen an internal document of this nature given to a party at interest, either in this or any other agency where I have worked.
I In response to specific questions during my deposition, I acknowledged that Commissioner. Roberts' office has been, in general, a continual critic of O!
operations. Commissioner Roberts has raised proposals before the Commission that would limit in some respects 01's ability to initiate investigations, to
- rake referrals to the Department of Justice, or otherwise to conduct the busi- !
I
. ness of 01.
l Another incident involved a second Middle South utility, Grand Gulf Nuclear Station in Mississippi. The then Regional Administrator of the NRC Region II l c
Office in Atlanta, Georgia, or his immediate staff, reviewed draft documents that the licensee proposed to submit to the NRC. On detecting the fact that the documents appeared to contain a material false statement, the Regional Adminis-trator or his staff told the licensee to go back and resubmit the document be-cause it would be considered a material false statement. .
TVA PROBLEMS Another incident occurred that appeared to be an improper contact between the NRC's Executive Director for Operations (EDO), Victor Stello, and the Tennessee Valley Authority (TVA) Manager of Nyclear Power, Mr. Steven White. The EDO is essentially the chief operating officer of the NRC. Most of the day to day activities of the NRC to include inspection, enforcement, licensing, and other regulatory activities are done under his general supervision. The general sub-ject of that contact was one of the major issues being investigated by 01 con-cerning the well publicized difficulties regarding the TVA nuclear program.
By way of, background, in December 1985, NRC Commissioner Asselstine was being briefed by NRC Region 11 personnel as well as TVA representatives on the status of the Watts Bar Nuclear Power Plant in Tennessee. I am told that during that briefing, members of the TVA Nur. lear Safety Review Staff reported that the plant was not built in accordance with NRC requirements; specifically, that the Watts n _- ._. _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _
~ ~. - - .
with Chairman Palladino. Chairman Palladino requested that I take the matter to Ms. Sharon Connelly, the Director of OIA, which I did that same day.
Af ter reporting the matter to 01A, I was deposed by investigators from that
! office shortly after making the initial report to Ms. Connelly. I subsequently read the OIA report concerning this matter and noted that the report consisted of my deposition and that of Mr.Stello, neither of which was taken under oath.
It also consisted of memoranda of interview rather than depositions of Messrs. Taylor and Denton. The thrust of Mr.Ste11o's deposition was that he advised White not to give a definitive response to the January 3, 1986 NRC let-ter which, in fact, asked for a very definitive response.
The March 20, 1986 TVA response was not, in fact, definitive, i.e., it did not provide a clear yes or no answer. Rather, it reported that Mr. White found that there was no " pervasive breakdown in the quality assurance program at Watts ,
Bar. The OIA report on this matter concluded that there was, no misconduct by NRC officials.
My OIA deposition was taken four days after my initial report to Ms. Connelly (April 11,1986), but Mr Denton and Mr. Taylor were not interviewed until the middle of June 1986. Mr. Stello was not deposed until July 30, 1986. In my view, this was a very serious, sensitive matter that deserved an expeditious review and investigation, and that especially considering the stature of Mr.Stello in the NRC structure, an investigation should be quick, complete, and thorough.
Judging from the report, no one from TVA was interviewed regarding any aspect of the investigation. During my Committee deposition, in response to Mr. Ryan's nestion, I acknowledged, that I would have placed Mr. White under oath and have taken a deposition concerning that telephone call. I agreed that a fair characterization of this matter was that a very senior NRC official was in con-tact with the licensee in a way that creates the impression that the official
~
tipped the. licensee as to how .they should answer a particular inquiry the.t was also the subject of an 01' investigation. .
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-g- l warranted. The IRB has been in existence for five months. Prior to the establishment of the IRB, Regional Administrators could refer suspected wrongdoing matters directly to 01. This is no longer the case. A Regional Ad=inistrator can no longer request an investigation without IRB concurrence.
1 The practical effect of the IRB has been a dramatic downturn in the number of wrongdoing matters referred to 01 for investigation. There have been a total of 8 requests for investigation in a five month period since the board has been in j operation. In contrast, for a comparable five month period just one year earli-er, 01 received 42 referrals for investigation. For example, as of the date of my deposition, one of the five NRC Regional offices, Region I, King of Prussia, Pennsylvania, had not submitted a single request for investigation since the initiation of the IRB.
I agree with Corrissioner Asselstine's statement that the IRB appears to be a
... thinly veiTed attempt by the EDO to control 01 by controlling wh'at referrals are made, and thus what 01 investigates." After Mr. Stello expressed the view that cases were being referred to 01 that should not have been, I wrote the E00 !
and asked for a list of such cases. Mr. Stello's response was a memorandum that basically stated that he didn't have the resources to answer that question. I failed to see what the problem was that the staff wat attempting to resolve. l Another change was SECY 85-369 which placed major limitations upon the NRC staff in its referral of matters to 01. That document establishes priorities for conducting investigations, defines wrongdoing, and provides a threshold for staff requests for investigations. . I believe the effect of that threshold has been to direct the staff to make their own internal evaluation in a way usurping ne ultimate goal of an 01 investigation, i.e., the determination of whether the r+tter is or is not willful. The staff's interpretation of this threshold ap-pears to be that they are required to gather evidence indicating willfulness rather than merely reporting wrongdoing. This appears to have " chilled" surfac-ing of wrongdoing items to 01. It is the role of the investigator to determine whether or"not a particular act was done willfully.
Other limitations exist on the authority of O! to initiate investigations re-garding the character and competence of licensees. To begin an investigation solely relating to those issues, 01 is required to make a recommendation to the
before the Commission". (1 of course did not.) I took the coment seriously, especially when I subsequently learned the legal assistant voiced the same con-Nonetheless, I be-cern to a member of the NRC Office of the General Counsel.
lieve that 01 did the right thing, especially in the particular case-in contro-versy which was a blatant example of not allowing my office to conduct a thorough, aggressive investigation into some identified false documents.
l That was not the first time Commissioner Roberts' assistant has suggested to 01 sta ff members that their jobs may~ be in jeopardy. In one such incident, the he told Roger Fortuna, the Deputy Director of 01, that Ol's management could be
.s . replaceo if "we or I" ever were to find 01 not abiding by the "will" of the Commission.
One way of controlling 01 would be to remove its independent status as a Comis-sion-level office and make it instead report to the E00. There have been sever-al Comission initiatives to move 01 under the EDO. One such effort resulted in
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a two to two tie with one Commissioner, then Chairman Palladino, abstaining. The effect of such a move would be to remove Ol's ability to go directly to the Commissioners; rather, O! would have to go through the EDO. A strong letter from the Departr.ent of Justice opposed any movement of 01 under Staff.
The proposed movement of O! under the EDO was of great concern to my staff and I because we do not feel that we could exercise the _ independence, the thorough.
ness, and completeness that we feel a professional Federal investigator must have to do a competent job were we to become a Staff office. If the Comission l is going to have an investigative arm, I believe that investigations of i
wrongdoing matters must be supervised directly by the Comission rather then the f.:C Staff.
All cases involving potential violations of 18 USC 1001 have to be given to the Comission for consultation before being released to the Department of Justice.
Moreover, all referrals to the Department of Justice. require consultation with !
the NRC Of fice of the General Counsel. In response to Mr. Ryan's question, I !
agreed that in disclosing these investigative results within the agency to the Commissioners and their staff and Office of the General Counsel, there would be i a possibility that this information could get back to the licensee, especially in light of the situations where such tips have been made by NRC in the past.
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i OPENING STATEMENT OF CHAIRMAN JOHN GLENN ,
l April 9, 1987 r s
Today we continue our hearings on . \
ways to fight waste, fraud and )
a .
mismanagement in the federal government.
1 I
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' Our. earlier hearings reviewed and ,
k documented the success of the statutory ,
Offices of Inspector Gen el, of which e
there are presently 19 Mcst of these i
offices were created pursuant to the 1 J
Inspector General Act of 1978, or amendments thereto. In the past five years, these offices have ' saved an I
estimated $71 billion in wasteful spending for the American taxpayer, and- ;
their investigations have resulted in l over 16,000 criminal prosecutions and ;
i 15,000 administrative actions.
2
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To monitor the integrity of its activities, in 1975 the NRC created an
,0_ffli~
- .e of Inspector and Auditor 2.(OIAT to provide the Commissioners with objective information on problems within the Commission. In 1982, as a result of a heightened awareness by the NRC that
'i allegations of possible wrongdoing by licensees and applicants required a vigorous' response, the NRC created its Office of Investigations (OI):
The existence of these offices within the agency have helped to lessen the public's doubts about the relative safety of commercial nuclear power. I j am, however, now deeply disturbed about i
current.NRC operations -- and 7 s, !
7,7 - ;
particularly the impact of certain1 ;
management actions on the mission and-
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l functions of these offices.
I i
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The Inspector General will report to the Chairman of the Commission and Congress concerning significant abuses or deficiencies and make recommendations for corrective action. In my view, this change will benefit the NRC's management operations and aid Congress' oversight
.t .
function.
As a practical matter, the bill
" transfers" the Office of Inspector and Auditor (OIA.) into the new Inspecto'r General Office. However, by, law, the Inspector General must be appointed'by
+
the President, with the advice and' ;
consent of the Senate, and c 5 be removed I
.3
. only by Presidential action. With these i'
s
, projections, the new Inspector General will be able to thoroughly investigate l allegations of employee misconduct or s nisranagement without fear of removal. - '
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My bill.is intended to restore confidence in the NRC's ability to achieve its regulatory mission.
I add that the Committee looks forward to hearing a great deal of testimony this morning, including testimony from the five members of the Commission. The Committee had originally planned the hearing so that the testimony on current NRC operations would first be presented by other witnesses, which would provide the Commissioners an opportunity i
to include comments on such testimony in their presentation to the Committee.
However, because the Commissioners have insisted on testifying first, I have reluctantly assented to their request. -
O m- -
s
- i Incredibly, when the Commission was 1 confronted'with solid evidence of the possible leak from a Commissioner's l i
office, th'e matter was not referred to OIA. Instead, Commission level officials made a decision that the matter should be handled within the Commissioner's office, s - and a minimal " investigation" followed with apparently little effort to make a l
record of such " investigation".
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I
- That episode alone demonstrates the need for a truly independent inspector general with the authority and expertise I
to investigate potential wrongdoing wherever it occurs, even if it involves a Commissioner's office.
My second concern relates to .
recently adopted NRC policies which have limited the effectiveness of the Office of Investigations (OI) to investigate external wrongdoing and refer potential criminal matters to the Department of
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Justice. -
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UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION
'87 Jll 24 A9:1(
COMMISSIONERS: ,n Lando W. Zech, Jr., Chaiman DN.g [
Thomas M. Roberts Frederick M. Bernthal Kenneth M. Carr SERVED JUL 2 41987 In the Matter of .
HOUSTON LIGHTING AND POWER COMPANY Docket Nos. 50-498-OL 50-499-OL (South Texas Nuclear Plant)
MEMORANDUM AND ORDER, On May 29, 1987, intervenor Citizens Concerned About Nuclear Power, Inc.
< (CCANP) moved to reopen the record of the South Texas nuclear plant (STNP) I licensing hearings. Based on the April 9,1987 testimony of NRC witnesses before the Senate Ctanittee on Governmental Affairs, CCANP claims there is evidence of intimidation and harrassment of NRC personnel in Region IV which may justify altering the Licensing Board's STNP decisions. Furthemore, ,
l CCANP seeks suspension of fuel loading currently scheduled for June,1987, I until resolution of the matters in the motion.
The utility filed an informal response on June 4,1987, arguing that CCANP's motion is an unauthorized pleading.
The Conrnission declines to entertain CCANP's motion to reopen. A motion ;
to reopen under 10 CFR 2 734 goes to the need for further hearings in a formal matter which is pending before the Commission. 51 Fed. Reg. 19535, 19538(1986). The Licensing Board concluded hearings on the application for i
/
fb u
,.e- . ..
. 2 operating licenses for STNP in 1986. TheAppealBoardinALA8-849(24NRC.
i' 523) sua sponte reviewed and affirmed two Licensing Board partial initial decisions. See LBP-86-15, 23 NRC 595; LBP-86-29, 24 NRC 295. The Comission did not review ALAB-849, and it became a final agency decision in December, 1986. CLANP did not appeal the Licensing Board decisions, did not petition for review of ALAB-849, and did not seek timely judicial review pursuant to 28U.S.C.2344(1987). Because the dec'ision in the adjudicatory proceeding t
has become final, Comission consideration of the motion to reopen is inappropriate. See Public Service Company of Indiana. Inc. (Marble Hill Nuclear.GeneratingStation, Units 1and2),'ALAB-530,9NRC261(1979).
This does not necessarily leave movant remediless.. If new evidence arises after an issue.has been fully litigated and a final agency decision has been rendered, one may seek relief by petitioning the staff under,10 CFR 2.206. See Carolina Power & Light Company (Shearon Harris Nuclear Power Plant), CLI-79-5, 9 NRC 607, 610 (1979); Florida Power and Light Company (St.
Lucie Nuclear Power Plant, Unit No. 2), ALAB-579,11 NRC 223 (1980). CCANP' may be able to obtain the relief that it seeks pursuant to a petition for an enforcement proceeding under 10 CFR 2.206. Therefore, the Comission will treat CCANP's filing as a 2.206 petition and refer the matter to the staff to determine whether any of the matters raised by the movant would warrant.
initiation of proceedings against the licenses for the South Texas Project.
The appropriate staff director has the discretion to differentiate between-those petitions which indicate that substantial issues have been raised warranting institution of a proceeding and those which seek to reopen issues previously resolved. NorthernIndianaPublicServiceCompany(Bailly Generating Station, Nuclear 1), CLI-78-7, 7 NRC 429, 434 (1978), aff'd, 606 F.2d1363(D.C.Cir.1979). We need not and will not consider whether the r -
= _ , - _ ____ -- .
3 assertions in the motion are sufficient to warrant granting the institution of a proceeding. That issue will be left for the staff to determine, subject to our discretionary review under 10 CFR 2.206(c). See Public Service Company of New Hampshire (Seabrook Station, Units 1 and 2), ALAB-513, 8 N 694,696(1978).
Furthermore, the Comission will not suspend fuel loading pending resolution of the matters in the motion, because CCANP has made no sh'ow under 10 CFR 2.788 regarding the requisites for issuance of a stay.
Therefore, the motion to reopen is denied and will be referred to the staff for consideration under 10 CFR 2.206, and the request for stay of fuel loading is denied.
_See Florida Power and Light Company (St. Lucie Nuclear i Power Plant, Unit 2), supra,11 NRC at 226.
' o It is so ORDERED.
g For the Comission*
$ #4
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My [Secretary SAMUELi'J. CHILK
%, N * * * ,d Comission Dated at Washington, D.C.
I this N "Cday of July,1987.
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- Commissioner Carr was not present for the affirmation of this order.
If he had been present, he would have approved it.
= _ _ _ _ - - _
UNITED STATES OF AMERICA l l
NCLE
. AR REGULATORY COMMISSION In the Matter of i 1
HOUSTON LIGHTING AND POWER COMPANY, ! Docket No.(s) 50-49B/499-OL ,
I ET AL. I (South Texas Project, Un:ts 1 and 2) !
I l 1
CERTIFICATE OF SERV!CE I hereby certif y that ce;ies of the f oregoing Commission Meeerandue & Order have been served upon tre f ellowing persons in accordance with the requartments of 10 CFR section 0.712.
Administrative Judge Adelnistrative Judge Sary J. Edles, Chairean Thomas S. Moore Atceit Safety and Licensing Appeal Atomic Safety and Licensing Appeal Board Board l l
U.S. Nuclear Regulatory Commission U.S. Nuclear Regulatory Cosmission l Washingten. DC. 20555 Washington, DC 20555 1
l Administr stive Judge Administrative Judge-Frederick J. Shen Charles Bechhoe'er, Chairman Atocic Sadety and Licensing Bea'd Atomic Sadety and Liceesing Board ct Washtegten. DC 20:55 Washington, DC 20555 .
Adelnistrative Judge Administrative Judge James C. Lamb, !!! W. R. Johnson ASL9P ASLAB i
1 313 Weochaven Road 115 Falcon Drive, Coithurst Chapel Hill, NC 27514 Charlottesville, VA 22901 l
Edwin J. Reis, Esq. helbert D. Schwart, Esq.
Office of the General Ccansel Baker & fcits U.S. Nuclear Regulatory Commission 3000 One Shell Plaza Washington, DC 20555 Houston, TX 77002 Jack R. Newman, Esq. Anthony 2. Roistan, Esq.
Nemran & Holt:inger, P.C. Anthony 2. Reisean, P.C.
1615 L Str ee t , N.W. , Suite 1000 1401 New York Avenue, N.W., Suite 600 Washington, DC 20036 Washington, DC 20005 l
l
l* *. 8 ,
.- a b . ..
3 tecket 6.c.is! $0-4cE 499-OL l
.. Ceesiss::n Fererandue % Crder !
4 j
Peggy L. Suchern Thcess J. Heiden Es:. Executive Director l Miller, Canfield, Pa dock and Stone Citizens for Equitable Utilities, Inc.
99 Monrce Avenue, N.L., Suite 1200 i r, t . 1, Por 1684 Grand Rapids, MI 4 c ! .53 Brareria, TX 77422 Berwick, Es:. Lanny A. Sinkin, Esq.
trian Assistant Atterney fraeral The Christic Institute '
1324 North Capitol Street, N.W.
Of fice ci the Atterrey General Washington, DC 20002 F.O. Sci 1254B Austir., TX 79711 George L. Constable l U.S. Nuclear Regulattry Commisticn, !
Region IV 611 Ryan Plaza Drive. Suite 1000 .
l Arlingt:n, TX .7601:
Dated at Washingtca. 0.C. this ds!
2a day cf July 1967 , j
. ....s'................ ........
Offs e o the Secretary of the ceeission l
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