ML22230A173
| ML22230A173 | |
| Person / Time | |
|---|---|
| Issue date: | 04/19/1978 |
| From: | NRC/OCM |
| To: | |
| References | |
| Tran-M780419 | |
| Download: ML22230A173 (1) | |
Text
- ro SECRETARIAT RECORDS NUCLEAR REGULATORY COMMISSION IN THE MATTER OF
PUBLIC MEETING POLICY SESSION 78-13 Place - Washington, D. C.
Date - Wednesday, 19 April 1978 Pages 1-19 Telephone:
( 202) J.47-3700 ACE - FEDERAL REPORTERS, INC.
Official Reponers
.d.44 North Capi tol Street Washingt on , D.C. 20001 NATlONWIDE COVERAGE* DAILY
DISCLAIMER This is an unofficial transcript of a meeting of the United States
~:uclear Regulatory Commission held on April 19, 1978 in the Commission's offices at 1717 H Street, N. W., Washington, D. C. The meeting was open to public attendance and observation. This transcript has not been revie1*1ed, corrected, or edited, and it may contain inaccuracies.
The transcript is intended solely for general informational purpose3.
As provided by 10 CFR 9.103, it is not part of the formal or informal record of decision of the matters discussed. Expressions of opinion in this transcript do not necessa.ri ly reflect final determinati ans or beliefs. No pleading or other paper may be filed with the Commission in any proceeding as the result of or addressed to any stc:J.te:rient .or 2.rg~1ment.
co:1 ta i ned herein, except as the Cammi ss ion may authorize.
- 1 UNITED STATES OF AMERICA 2 NUCLEAR REGULATORY COMMISSION 3
4 5
6 PUBLIC MEETING 7
8 POLICY SESSION 78-13 9
10 11 Room 1130 1717 H Street, N. w~
12 Washington, D. C.
13 Wednesday, 19 April 1978 14 The Commission met, pursuant to notice, at 1:55 p.m.
15 BEFORE:
16 DR. JOSEPH M. HENDRIE, Chairman 17 PETER A. BRADFORD, Commissioner 18 RICHARDT. KENNEDY, Commissioner 19 PRESENT:
20 L. GOSSICK 21 L. SLAGGIE 22 C. STOIBER 23 J. HOYLE 24 Ace-Federal Reporters, Inc. K. PEDERSEN 25 E . VOLGENEAU
lA
- s. CONVER 2
E. CASE 3
J. MURRAY 4
5 6
7 8
9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24
, Ace-Federal Reporters, Inc.
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CR 7166 2 WITLOCK t-9 CHAIRMAN HENDRIE: The Commission -- let us go off mte 1 2 the subject this afternoon. It is a subject on a proposal by 3 the staff to go forward with legislation to increase the civil 4 penalties, or to allow us to have the authority to set higher 5 civil penalties.
6 Ernie, I guess this is your department. Are you goin 7 to talk? Why don't you kick off?
8 MR. VOLGENEAU: A little over a year ago, as part of 9 our inspection and enforcement study, we involved ourselves in 10 a study of how to improve incentives for licensees. Very 11 quickly it became obvious to us that the civil penalty autho-12 rity should be increased. We broke that up as a separate sub-
- 13 14 15 study within the licensee .. ~':d:.ndenti ves. study-., There are other parts of the licensee incentive study that are continuing, and we will keep the Commission informed on those. Many of these 16 things we are coming up with we can do ourselves.
17 For example, I am still not satisfied that our en-18 forcement action is as timely as it should be. It takes an 19 awful lot of time from the time that we detect something wrong 20 and our investigation is complete until the time enforcement 21 action is taken. But we can talk about that another time. So 22 we will confine ourselves to the civil penalty papers that we 23 sent to the Commission on March 13th, and Steve Conver, who 24 works for me in our special study group, has done an excellent
, Ace-Federal Reponers, Inc.
25 job in conducting the study himself, which included the efforts
rote 2 3 of a contractor and them in preparing the Commission paper.
2 Steve?
3 MR. CONVER: Okay, could I have the first chart, 4 please.
5 (Slide.)
6 MR. CONVER: The. purpose of this presentation is to 7 provide the Commission with the basis for making a .decision on 8 the advisability of increasing our civil penalty authority.
9 As Dr. Volgeneau mentioned, the briefing will parallel the 10 Commission paper which we forwarded earlier, SECY 78-147.
11 Shown on the chart, the current authority for civil penalties 12 is found in the Atomic Energy Act, which was amended in 1969, 13 late '69, with the addition of section 234, which provided us 14 with our civil penalty authority. Section 234, this provided 15 for a limit of $5,000 for any violation that was found at the 16 licensed facility, and a total limit of $25,000 for all viola-17 tions occurring within a period of 30 consecutive days.
18 MR. MURRAY: With no overall limit?
19 MR. CONVER: Yes, sir.
20 After nearly a decade of experience in having this 21 authority and using the-civil penalty, I&E believes the time 22 is right to re-examine the adequacy of the current limits.
23 Therefore, we turn our attention to two issues, the first being, 24 should we request from the Congress an amendment of the Atomic Ace-Federal Reporters, Inc.
25 Energy Act to increase our authority, and, if so, what specific
mte 3 4 authority should we reouest?
2 Could I have the next slide, please?
3 (Slide.)
4 MR. CONVER: Now, it is possible to vary the amounts 5 of the civil penalties in various ways in defining them to come 6 up with virtually a limitless number of alternatives. However, 7 we believe that the most important distinctions were between 8 general levels of penalties, which we defined as, one, the 9 present authority of $5,000 and $25,000, two, not a terribly 10 increased authority, which we have identified as $20,000 and 11 $100,000, and what we refer to as substantially increased autho 12 rity of $100,000 and $300,000.
- 13 14 15 Could I have the next chart, please?
(Slide.)
MR. CONVER: Now, in ev*aluating these three alterna-16 tives, we have used three decision criteria; the f irs.t one 17 beinq, will this give an alternative, encourage licensees to 18 have an adequate or perhaps greater level of comp1iance with 19 the increases in safety that might be expected to accompany any 20 increase in compliance; two, would the alternative give NRC the 21 flexibility that it needs to apply these civil penalties 22 thoroughly and with some sense of proportion to the licensees 23 who need them; and finally, would the alternative provide civil 24 penalty authority which is comparable to the authority of other Ace-Federal Reporters, Inc.
25 regulatory agencies with missions similar to ours for
mte 4 5 protecting the public health and safety.
2 Could I have the next chart?
3 (Slide.)
4 MR. CONVER: By way of background, civil penalties 5 compose just one element in our total enforcement program.
6 Authority for the enforcement program derives from the Atomic 7 Energy Act and also from the regulations, 10 CFR Part 2.
8 Licensees are subject to enforcement action any time they vio-9 late the provisions of either of these two, the Atomic Energy 10 Act or the 10 CFR, or if they violate other .*regulatory re-11 quirements such as those found in technical specifications.
12 There are three types of basic.enforcement actions 13 that we can take. In order of severity, these are notices of 14 violation, civil monetary penalties, and orders. A notice of 15 violation is simply a way of identifying the licensee's non-16 compliance and requesting a statement from him of his intended 17 remedial and. pr.even ti ve ~ctions to keep the noncompliances from 18 recurring. Orders, at the other end of the spectrum, are a 19 severe sanction. There can be several types of orders depend-20 ing upon the circumstances. Civil monetary penalties, or, civil 21 penalties for short, were originally intended by the people 22 drafting the amendments to the Act in 1969 as an intermediate 23 sanction would be used in the circumstance**where the notice of 24 violation was considered insufficient to get the needed correc-Ace-Federal Reporters, Inc.
25 tion, but where an order seemed either inappr,opriate or not in
mte 5 6
the public interest. We have tried to continue that practice 2 and use civil penalty in that way.
3 In addition to these three basic enforcement actions, 4 NRC also has several administrative actions shown on the chart 5 to improve the compliance of our licensees.
6 Next chart, please.
7 (Slide.)
8 MR. CONVER. This chart shows how NRC has used its 9 civil penalty authority since late 197~, when NRC imposed its 10 first civil penalty. A total of 65 civil penalties have been 11 imposed. You can see that more than half of these, or 35, have 12 been imposed on materials licensees. Of the remainder, the 13 vast majority have been imposed o.n power reactors, and all but 14 one of these have been on operating reactors.
15 MR. MURRAY: It wasn*~ until late 1973 that the first 16 civil penalty was imposed on a reactor licensee. We have had 17 the authority since '69.
18 MR. CONVER: Despite what you might think, an impos-19 ing number of civil penalties in regards to our licensees, 20 which now number over 2,000, has been generally good.
21 Furthermore, there** have been very few instances in which people 22 have suffered major injuries as a result of nuclear-related 23 incidents in licensed facilities. However, at the same time,*
24 we also recognize there are some licensees that have not had Ace-Federal Reporters, Inc.
25 the compliance records we believe they should. Examples of
7 that are shown on this chart, also. There are some nine licen-2 sees who have received more than a single civil penalty. One 3 licensee has received four, another has received three, and 4 seven others have received two civil penalties.
5 Notice that most of the multiple civil penalties have 6 been imposed on power reactor licensees. It is with the notion 7 of including the compliance records of these few large licensee 8 and others who might have similar problems that I&E is motivate 9 to consider an increase in our civil penalty limits.
10 The next chart, please.
11 (Slide.)
12 MR. CONVER: How might higher civil penalties affect 13 licensee compliance? This is our first evaluation criteria.
14 For* smaller licensees, we do not believe higher civil penalties 15 are necessary. Current levels of fines appear quite adequate, 16 primarily, we feel, because the financial effects of civil 17 penalties are quite severe on these smaller licensees.
18 With larger licensees, however, the situation appears 19 somewhat different. A lot of people argue that mere imposition 20 of a civil penalty is the important thing with the larger li-21 censee, not the amount of that penalty. There certainly seems 22 to be some arguable point there. On the other hand, we also 23 argue that the financial effects, at least, of our current 24 levels of civil penalties on these large licensees are virtuall Ace-Federal Reporters, Inc.
25 negligible. As evidence of this, we have the previously~cited
mte 9 8 examples of the few major licensees who have not provided 2 licensing corrections in response to our existing levels of 3 civil penalties. It is difficult to prove that larger penaltie 4 would be more effective in promoting compliance, although we 5 intuitively believe that they would be. However, I&E certainly 6 would have imposed higher penalties in some of these cases had 7 we had that authority at that specific time.
8 Higher penalties may also improve compliance in more 9 subtle ways. T~ey may enhance corporate awareness of NRC 10 requirements. . ~lso, corporate executives, when faced with 11 possible conflicts between compliance and comme*rcial objectives 12 we feel will"i,be increasingly inclined to promote compliance if 13 penalties are higher. They might, even be encouraged to assign 14 more and better people to the resolution of compliance problems 15 when they resolve -- when they arise.
16 Finally, higher civil penalties, we feel, may even 17 add to the benefit of the regulated industry by enhancing the 18 credibility of NRC' s regulation4
- 19 In total, there are a variety of reasons why we feel I.
20 that higher penalties would promote better licensing compliance 21 Could I have the next chart, please?
22 (Slide.)
23 MR. CONVER: I&E believes that the present limits 24 of $5,000*and $25,000 define too narrow a spectrum of penalties Ace-Federal Reporters, Inc.
25 to adequately accommodate the various types of licensees that
mte 8 9 we have, as well as the various seriousness of violations that 2 can occur. Another of the most important attributes that a 3 civil penalty should have is that it should signal, provide a 4 signal, to licensees that should communicate to them the total 5 level of the fine that is imposed upon the licensee, should 6 communicate to him the overall significance that NRC places 7 upon the noncompliances that he has had. And the fines that 8 we give for each specific noncompliance should give the licen-9 see some signal as to the relative importance that NRC attaches 10 to each of those noncompliances.
11 I&E believes that 'the present limits make this kind o 12 communication with the licensees rather difficult. We also
- 13 14 15 believe that higher penalties for the larger licensees would redress what we consider a present imbalance between the fines given to larger and smaller licensees. The present program 16 generally does fine the larger licensee more because we recog-17 nize that the consequences of noncompliances by larger licensee 18 are generally more severe than the potential consequences of 19 noncompliances by smaller licensees. However, we still feel 20 that the larger licensees are fined in amounts that are propor-21 tionally too small. And the next chart illustrates this point.
22 (Slide.)
23 MR. CONVER: Now, under our current civil penalty 24 guidance, civil penalties are imposed on the licensee after Ace-Federal Reporters, Inc.
25 careful review of all the facts in a given situation. However,
- mte *g, 10 a civil penalty is always considered if the so-called action 2 points total 100 or more in a given inspection. We define our 3 action points in terms of 100 points for violation, ten for an 4 infraction, and two for deficiency. At the end of each inspec-5 tion we add these up to determine the total action points.
6 This techniaue is one way that we insure consistency in trying 7 to determine whether or not a penalty should be imposed. How-8 ever, the actual size of that penalty is determined by the tabl 9 showh:,on the bottom of the chart.
10 There are basically two factors that are considered 11 in determining the size of the civil penalty: one, the type of 12 licensee; and two, the severity of the noncompliance.
13 There are two types of disproportions.that are evi-14 dent in this chart. The first is that, whereas in our ac~ion 15 points we weight the violations ten times more than the infrac-16 tions, looking down the violation and infraction columns, you 17 can see that the ratio between the fines given for violations 18 and those fines given for infractions are nowhere near ten to 19 one. In fact, they are more like five to four, four to three.
20 We consider this an inconsistency in our program that would 21 be redressed by increasing the fines for the larger licensees 22 for the violations.
23 Another type of imbalance here is between types of 24 licensees. Power reactor is fined from $4?000 to 5,000 for a Ace-Federal Reporters, Inc.
25 violation, and a very small radiographer might be fined as much
'mte io. 11
$2,000 for a violation. This to us does not seem to be in the 2 correct proportion.
3 The next chart, please.
4 (Slide.)
5 MR. CONVER: This chart shows the levels of civil 6 penalties that might be expected if alternative three, substan-7 tially increased_ cirvil.J.ai.lif:hori ty, is approved by the Commission 8 I would caution, these are rough estimates based on tentative 9 guidance. We would certainly want to refine our guidance 10 considerably. These are indicative. The numbers in parenthese 11 in the noncompliance column are the number of violations and 12 infractions that would occur in each case.
13 The first case there illustrates that for a small 14 radiographer we would not modify the levels of fines given to 15 these and other similar small licensees. An, -overexposure might 16 be fined $5,000 both under the existing and the revised autho-17 rity.-: . For a power reactor, however, in case two, we might 18 find that an overexposure would be penalized a little bit more 19 under the existing authority, substantially more under the 20 revised authority; whereas under the current guidance, we would 21 be limited to a fine of about $10,000 for one violation and two infractions. Under the new authority, we might elect to 22 23 fine such a series of noncompliances by as much as $60,000.
24 In case three, we have exactly the same situation as Ace-Federal Reporters, Inc.
25 in case two, except in this situation the power reactor has
mte 11 12 repeated the same noncompliances that he had earlier. In this 2 case, we would like to have the latitude to double the fine, 3 and in this case it would be from $60,000 to $120,000.
4 Case four illustrates a very serious combination of 5 noncompliances, where you would have an unplanned criticality 6 relating to an overexposure at a power reactor facility, two 7 violations and five infractions. Under existing, we might fine 8 such a licensee about $25,000, whereas under the new authority i---
9 we would fine this licensee somewhat more, about $250,000, 10 give or take some.
11 The final four cases represent typical cases that 12 are similar to the ones that we have actually experienced. Jus 13 to give a general impression of how these might run at major 14 field facilities, you can see that they represent an increase o I
1--
15 somewhere between, say, five and ten over the what we give 16 under the existing civil penalty authority.
17 Can I have the next chart, please?
18 (Slide.)
19 MR. CONVER: At this chart we look at our final 20 evaluation criteria, the civil penalty authority of other 21 regulatory agencies. Civil penalty authority of the various 22 agencies is expressed somewhat differently. This makes direct 23 comparisons a bit difficult. However, we have tried to compare 24 NRC's authority to nine other regulatory agencies, including Ace-Federal Reporters, Inc.
25 the Department of Transportation, Consumer Products Safety
mte 1i 13 Commission, Food and Drug, FAA, the Bureau of Motor Carrier 2 Safety, the Coast Guard, Min~ng Enforcement and Safety Adminis-3 tration, and OSHA.
4 We have used three measures of civil penalty authorit, 5 the first being the maximum civil penalty hhat the agency can 6 give per single vi6lation 6r per day of violation; the second 7 being the maximum total civil penalty; ~rid the final one being 8 the largest civil penalties that this agency has typically 9 collected. Looking at the first column, the maximum civil 10 penalties per violation, there are four agencies here whose 11 authority exceed that of NRC, either by virtue of having greate 12 penalty authority per day or by having no limit on single 13 violations. The second column, the maximum total CP's, again 14 ,it is a little bit difficult to compare because NRC's authority 15 is not simply a total, but rather, a total for a 30-day period.
16 But nonetheless, there are six of the nine agencies compared e-9 17 whose total civil penalty authority seems to exceed NRC's.
18 Under penalties ~ctually imposed and collected, 19 there are five of the nine agencies that have*collected fines 20 well in excess of NRC's largest.
21 Can I have the next chart, please?
22 (Slide.)
23 MR. CONVER: I would like to now summarize each of 24 the three alternatives that we have considered in terms of the Ace-Federal Reporters, Inc.
25 rationale that I have just presented. The first alternative,
rote 13 14 present penalty authority, has as its advantages, if we already 2 had the authority we wouldn't have to go to Congress. We cer-3 tainly can't prove that our existing authority is inadequate, 4 although we may believe that it is. And finally, the dollar 5 amounts of the penalties may be secondary to the mere imposi-6 tion of the penalties. A~ disadvantages, we note that the cur-7 rent levels of the penalties appear to be insignificant to 8 large licensees. We have cited examples of several licensees 9 who have not responded to civil oenalties issued under this 10 authority. We find it is very difficult to impose fines fairly 11 in proportion under(*ithe.i.existing authority.
12 (Slide.)
13 :MR. CONVER: Under the second alternative, moderately 14 increased authority, this alternative is basically designed to 15 provide the same equivalent financial effect in the late 1980s 16 as was originally intended by the Congress in 1969. This 17 authority barely compensates for inflation. It shares the 18 advantage that the dollar amounts of the penalty may be secon-19 dary to the mere imposition of the penalty.
20 The disadvantaqes:' We still feel that the financial 21 impact of these fines, even at this level, would be relatively 22 small for the larger licensees. In*fact, although the situa-23 tions are not directly comparable, fines of this level are no 24 more -- are no larger than those that are commonly given to 1
Ace-Federal Reporters, Inc.
I 25 individuals in criminal proceedings.
rnte 14 15 (Slide.)
2 MR. CONVER: Under the third alternative, substantial y 3 increased authority, we feel it has the following advantages:
4 One, substantially increased authority would provide strong 5 financial incentives, even to the very largest licensees, to 6 comply with NRC requirements. This increased authority may 7 indirectly help the regulated industry by enhancing the credi-8 bility of NRC's regulation. It would permit NRC to impose 9 penalties fairly and in some sense of proportion. It would 10 provide authority that is comparable to that of other regula-11 tory agencies. for similar missions as ours. And finally, this 12 level apparently would be less severe than a license suspension 13 or a revocation, in the sense of being economically distinguish 14 able from such a step; therefore, it would preserve the origi-15 nal intent of the Congress of 1969.
16 It does have some dis advantages that should be .noted:
17 The need for this higher penalty authority cannot be proven 18 absolutely. In the end analysis, it is basically a judgmental 19 question. Two, it may be somewhat difficult to get congression 1 20 approval of this action. However, that is really beyond I&E's 21 capability to judge. There is some feeling thatsuch a request 22 might be interpreted as a negative NRC perception of the
- 23 24 Ace-Federal Reporters, Inc.
industry, and we certainly wouldn't want this to happen. And finally, it goes without saying, if we were to be granted this
- 25 authority, we would certainly have to use it with considerable
mte 15 16 judgment and discretion in developing our civil penalty guid-2 ance to have the best results-3 (Slide.)
4 MR. CONVER: Finally, our recommendation to the 5 Commission, as we have already noted, is that the Commission 6 approve alternative three, providing for substantially increase 7 authority of $100,000 per violation and $300,000 for all vio-8 lations in 30 consecutive days.
9 OGC has prepared and forwarded to the Commission a 10 package which suggests the modified language to the Atomic 11 Energy Act that would put this recommendation in place.
12 I appreciate your attention.
I~ - 13 14 15 MR. VOLGENEAU: That's it, sir.
CHAIRMAN HENDRIE: Questions?
COMMISSIONER KENNEDY: I vote yes.
16 CHAIRMAN HENDRIE: Peter?
17 COMMISSIONER BRADFORD: I do vote yes. I do have a 18 question, though, on which my vote does not hinge. What kind o 19 line would we draw between seeking civil penalties and, I 20 guess, referring the matter to Justice with regard to possible 21 ciiminal penaltiei?
22 MR. VOLGENEAU: It is a violation of a law as opposed 23 to a violation of one of the NRC regulations. If it is a vio-24 lation of one of the NRC regulations 1 we would seek some kind Ace-Federal Reporters, Inc.
25 of enforcement action, ranging from a notice of violation to a
- mte '16 17 civil penalty to an order. If there is a possible criminal 2 violation, we will do .the preliminary investigation and then 3 refer it to Justice. Sometimes Justice participates with us
- 4 5
6 if they agree that it has possible criminal implications.
Sometimes they just take it over and we assist them.
COMMISSIONER BRADFORD: lvhen the statute then says --
7 and Tom has -- maybe it's as rimch your field -- Jim, as Ernie*' s 8 but when a statute says that you have a broad general mandate 9 and the NRC is to set up regulations, does that mean that 10 violations of the regulations -- are normally civil?
11 MR. MURRAY: Not necessarily. They could be criminal 12 if they are willful, under section 232 of the Act.
13 COMMISSIONER BRADFORD: Once you get down into the 14 regulations, it would have to be a willful violation of the 15 regulation.
16 MR. MURPAY: Yes. Typically, what happens if there 17 is an apparent violation both of a law and our regulation, we 18 defer to the Justice Department, because they are concerned 19 about double jeopardy. I don't know whether they still are, 20 but they still say they are, in light of some of the civil 21 penalty cases that have come down in recent years. So we just 22 hold our hand in taking any enforcement action pending the 23 outcome of any criminal action on their part.
24 COMMISSIONER BRADFORD: But when you have a statute Ace-Federal Reporters, Inc.
25 that says, in effect, thus and such activity shall be
18 conducted safely, the NRC shall by regulation define "safely",
2 if the regulation is violated we don't automatically take that 3 to be a violation of the statute as well.
4 MR. MURRAY: No, sir.
5 CHAIR.Ml'-..N HENDRIE: I notice that the General Counsel' 6 Office would like to see this, that the Counsel's Office is in 7 agreement with the civil penalty level proposed and also would 8 like to see this proposal go forward to make a change from 9 administrative imposition 10 MR. STOIBER: Yes, our proposal was discussed and 11 given tentative approval by the Commission last year in April.
12 We were waiting to attach to it the recommendation by IE for 13 the increased penalty limits, so they could be sent at the 14 same time to Congress. In our memorandum of April 12th, which 15 we forwarded to you, we discuss the rationale behind the 16 proposal to also adopt an administratively -- I think the es-17 sence of the proposal would give the Commission greater control 18 over its ability to in fact levy these civil penalties without 19 the need for perhaps a co~lection action by the United States 20 Justice Department in the courts, with the kind of detailed 21 loss of control to*the Commission that that involves. This is consistent with the statutes of a number of other agencies.
22 23 We would urge that that provision be rea.ffirmed by 24 the Commission and also included in the package we sent to the Ace-Federal Reporters, Inc.
25 Hill.
mte is 19 COMMISSIONER KENNEDY: Aye.
2 CHAIRMAN HENDRIE: Peter?
3 COMMISSIONER BRADFORD: Yes~
4 CHAIRMAN HENDRIE: I will vote yes. The measure 5 carries. So ordered.
6 John, -w.re you ready to affirm some i terns?
7 MR. HOYLE: Someone was coming in to do thatr sir.
e-10 8 (Whereupon, at 2:23 p.m., the meeting was adjourned.)
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