ML23151A406

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PR-002 - 56FR36998 - Policy and Procedure for Enforcement Actions: Policy Statement
ML23151A406
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Issue date: 08/02/1991
From: Chilk S
NRC/SECY
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PR-002, 56FR36998
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ADAMS Template: SECY-067 DOCUMENT DATE: 08/02/1991 TITLE: PR-002 - 56FR36998 - POLICY AND PROCEDURE FOR ENFORCEMENT ACTIONS; POLICY STATEMENT CASE

REFERENCE:

PR-002 56FR36998 KEYWORD: RULEMAKING COMMENTS Document Sensitivity: Non-sensitive - SUNSI Review Complete

PAGE 1 OF 2 STATUS OF RULEMAKING RECORD 1 OF 1 PROPOSED'RULE: PR-002 OPEN ITEM (Y/N) N RULE NAME: POLICY AND PROCEDURE FOR ENFORCEMENT ACTIONS; POLICY STATEMENT PROPOSED RULE FED REG CITE: 56FR36998 PROPOSED RULE PUBLICATION DATE: 08/02/91 NUMBER OF COMMENTS: 2 ORIGINAL DATE FOR COMMENTS: 09/03/91 EXTENSION DATE: I I FINAL RULE FED. REG. CITE: 56FR36998 FINAL RULE PUBLICATION DATE: 08/02/91 NOTES ON.;_ PlIBLISHED KS FINAL POLICY STATEMENT. CORRECTION NOTICE PUBLISHED ATUS ON 10/11/91 AT 56 FR 51321. FILE LOCATED ON P-1.

RULE PRESS PAGE DOWN OR ENTER TO SEE RULE HISTORY OR STAFF CONTACT PRESS ESC TO SEE ADDITIONAL RULES, (E) TO EDIT OR (S) TO STOP DISPLAY PAGE 2 OF 2 HISTORY OF THE RULE PART AFFECTED: PR-002

(

RULE TITLE: POLICY AND PROCEDURE FOR ENFORCEMENT ACTIONS; POLICY STATEMENT

[

~OPOSED RULE PROPOSED RULE DATE PROPOSED RULE

~CY PAPER: SRM DATE: I I SIGNED BY SECRETARY: 09/29/91 FINAL RULE FINAL RULE DATE FINAL RULE SECY PAPER: SRM DATE: I I SIGNED BY SECRETARY: I I STAFF CONTACTS ON THE RULE CONTACT!: JAMES LIEBERMAN

DOCKET NO. PR-002 (56FR36998)

In the Matter of POLICY AND PROCEDURE FOR ENFORCEMENT ACTIONS; POLICY STATEMENT DATE DATE OF TITLE OR DOCKETED DOCUMENT DESCRIPTION OF DOCUMENT

~-------------------------------------------------------------------------------

09/05/91 09/04/91 COMMENT OF WINSTON & STRAWN (NICHOLAS S. REYNOLDS) ( 1) 09/09/91 09/05/91 COMMENT OF NUCLEAR MANAGEMENT AND RESOURCES COUNCIL (BYRON LEE, JR.) ( 2) 11/04/91 10/08/91 POLICY STATEMENT: CORRECTION - PUB. ON 10/11/91 IN 56FR51321

Feder. l Register / Vol 56, No. -198 / Friday, October 11. .1991 J Rules and Regulations S1321 This _ m will not

  • cant 1991), will tend to effectu te the Federal Register that modified the.

econo.; .~ .mpact on era or declareq policy of the Conimlsslon'a Enforcement Policy to p:-odur~,3 This action oth* - Pursuant to the provisi na in 6 U.S.C. add an additional example to the procJc"r" and handlers 553, It ls found and deter: that good Reactor Operations Supplement

, lien the efund period d w at cause exists for not po11 onlng the Involving maintenance related

.., l.'.ocume:- .tlonisacce

  • proving effective date of this ac n until 30 days violations and to delete the civil penalty paymer r assessme after publication in the e,leral Register,, . adj118tment factor for vl~lations . *

... Sect1.i , '\47(1>)

(7 U.S.C: because: (1) Thill action lntalna the - Involving maintenance deficiencies. This

.;,105(b _ ,11.d* e Plan (7 clarifications ands cations of the document Inadvertently replaced an .

CFR 1 * ,O. (b)) Board to interim ftnal rule; (2) th interim ftnal example that was added to the Reactor rr!C0!;. *one.. (0 the ch rules rule provided a 30-day mment period. Operations Supplement involving a

-rnd r, .ations as to and twenty-one comm ts. all favoring licemed operator's confirmed positive

'"coct* 1te the tions of the amendments. were * (3) the .drug test by a final rule published on 1991 crop year is tly underway; July 15, 1991 (56 FR 32066). This action ia and (4) no useful e would be necessary to restore the text of .

served by delaying effective date appendix C. supplement 1, paragraph c.9 until 30 days alter-pub tlon.

  • that wail added In the July 15, 1991, final List of Subjects In 7 Part 1210 ruli, and to correct the paragraph

- designation of the p~ph added In Administrative the August 2, 1991, policy statement.

procedure, Adv E'Fl!CTIVE DATE: August 2, 1991.

re11earoh, Repo .

. requirements. W ns. FOR FURTHl!R INFORIIATION CONTACT:

For the reas in the James Lieberman, Director, Office of preamble, part 1 ter XI of title 7 Enforcement, U.S.-~clear Regulatory ls amended as fo , Commission, Washington.DC 20555, T~lephone (301) 492-0741.-

PART 2=-AULES-OF PRACTICE FOR - ,

DOMESTIC LICENSrNG PROCEEDINGS

.1. The authority citation for part 2 .

continues h? read in part as follows:

- .

  • Authodty: Sec 161, 68 Stat.*948. as amended (~ U.S.C. 2201}: aeo. 201, 88 Stal.

1242, ss* amended (42.._U.8.C. 5841}. *

  • Z: Appendix C, supplement 1, 'is *.

corrected by revising example c.9 and by adding_ example c.10 to read as follows: ,_

  • _ , ,, -, .-

Sl32Z Federal Register / Vol. 56. No. 198 f Friday, October 11.-1~ / Rtdes and Regulations I

  • Donnie GdmlleJ'.. .. ' -.. . -.** - : : - Con9UD18r protection, Credit; Fedetal' *
  • DEPARTUENT OF TRANSPORTATION

" 1 Reserve Syste Finance, Penaltles, .. ":, .  : * * .*. :

  • Director. Divf6ion ofFreedt,m oflrrformatian and Publicatioits Servks. Offeet1 of
  • Rate limitatio Truth in leodlng. * - .. Federal AYlatlon Adminiatratkm. . ' *
  • 12CFRcha llisamendedu J": - 14CFR.Part<Ml.

[FR Doc. 9 1 ~ Piled 10-10-91; S.'4& am) - followw: ' ' -* - - * * - - -* ""I' IIIUJNQ eooe 7IIO-OMI [Docket No. 91-H

~ ~1-21-12)_ /

FEDERALR I-.

l . . .

I Ah WOI thll ten Db'8C1ltvett1!

citation for 12 CPR -Models 737, 7ff7,.

etNo.R-0737) .. s to read as {ollo,n: Alrplanea nl'llrwvtuntty,Con9umer AOl:NCV:Fed In Lending Administration .

ACTION: Final ACmtCY:

Federal ACTION:T

  • 8UIIMARY! The technical amen is making o its regulations r I

to reflect the org nal restructuring of ce orThrift-Superviaion.

~R~ l~tJfffi~ CONTACT:

Dale L Nis ttomey, Division of d Community Affairs, at ( for the hearing 1'. The a*

impaired on! orothea

  • part 213 br Thompson, cations Device Aatbority:

for the Deaf. Board of FOR ON CONTACT:

Governors of al Reserve Appendix Enforcemen I\J!BIK:189 Mr. Steph Aircraft System, Was 20551. Certificati and IUPPI.IMENT TION: The amended by adding -, Equipment 1308; *

  • Office of Thrift ion (OTS) has heading the telephone undergone a a organization reference Office Thrift Superviliion address nHI,.,.,..., ountain which has e title "District Regional Director f r the region in which Region. l:llllt111Ut:* Directorate, Director" and al recognition of the institution i8 lo ted."  :. 1601 ton. ' ,

an OTS Hdistri allgnmen~ has Was abolished the stricts .and IUPPL.l:M created five proposal to the Fede'"

,The Board's ns B (Equal 1. The authority ci atlon for 12 CFR .. Aviation elude an Credit Oppo Consumer 1

- part 226 con.tlnuea t read as follows:

  • airwo - applicable to Leasing), and Lending) certain Bo I 757, and 74t contain refere various Authority: Troth In ding Act. 16 U.S.C 400 aeries tequires Federal a ncfes 1604 and aec. 2, 102 8'at. -. ~- repJacem control panels responsible i enl The 2900; sec 12(M{c), Eqnality
  • in the puhlished *in the following hereby made Ban1dng Act. Pub. 101 Stat. 1152: ,- . , Federal f, 1991 (56 FR to the Board ns B, M, and Z Appendix 1-F J!.nliorcement - - .25380).

to reflect thi rganization. Agencies [Am Interes have been afforde an . cipate in the

. List of Subjects 2. Appendix I is ded by removing making of enLDue 12 CFR Part 202

  • under the fourth headfrig the reference *. considers given to the Banlcs, Banking. . ts, --rhe District Director of the Office of* ... co Consumer protecti t, Federal Thrift Supervision in. Ui~ district in*  : stated that there Reserve System, M tatus which the institution is located." and . is a nee efine the dash discrimination, , adding "Office of Thrift Supervision numbers ed parts and to Penalties, Religio ,Olll1cnnnn.ation, Sex Regional Director for the' region in which identify the corrective dJscrimination, Wo e the mstitution is loca~ in its place. panel(s). tea that the panels Board ofGovemora ofthe'Federal Reserve required to by this AD are 12 CFR Part 213 P /N's 285U , -105, --201. -202.

Advertising. Co er leasing, TTUth -- System, October 3, 1981. ~-.

  • and -203. s* dash numbers WUllam w. WUN, - _: ;_. . : -:. .. -~ . . constitute numbers
  • in lending. Secretmy of the Board. . . - . . .
  • currently and the proposal .

12 CFR Part 226 (FR Doc. 9 1 ~ Filed 10-1  ; 8:45 am] identified th the basic part.

1111.UNG CODE 121M1-lt number ( , there is no impact

FederaJ .Reglsts / VoL* 56, No. 149 I Friday, 'August 2, 1991* /*Rules and "Regulations* - :86999 concernfng maintenance In Supplement I fits more appropriately in the overall structure of the F.nforcement Policy and will provide the appropriate flexibility .

to deal with the various maintenance

. issues. Slgniflcant deficiencies in the, . .

performance of maintenance activities that impact plant equipment where a violation la involv~ may be considered a afgnifioant regulatory concern. The added example provides notice * .

consistent with the final rule that .

appropriate maintenance is expected to be conducted for both safety-related and applicable balance of plant systems.

Llat of Subjects in 10 CPR Part Z Administrative ptBCtice end procedure, Antitrust. Byproduct material. Classified information, Civil penalty, Enforcement. F.nvjronmenta]

protection, Nuclear materials, ~

power plants an4 reactors, Penalty, Sex discrimination. Source material. Special nuclear material. Violatiom, and Waste t;reabnent and disposal.

PART 2-RULES OF PRACTICE FOR D O ~ LICENSING PROCEEDINGS

  • 1. 1be authority citation for part Z oontinuea to read in Pfil'! aa followa:

Autllodty: Sec. 181, 1111 Stat. MS, aa amended cc u.s.c. 22011: aec. 201. ee Stat.

. ut2, ~amended(~ u.s.c. 58Cl). ..

2. Appendix C section V .B Is amended by removing subsection seotion V .B.7.

Appm;ulix C 1111pplement I la amended by adding example c.9 after example Q8. .

Appendix C-General Stale.neat of Polley and Procedme for NKC Enforcement Actiom Supplemaot~C-tep:iu L

  • * * * .* OnM Reactor Operat/oN request£
  • * * *
  • release").

for use in C. ~ t y Llml DI-Vlolatiom mvohtns banking for example:

  • prop~
  • * * * * *. olarlflca
9. Equipment faflmes caused by Inadequate guidelin or Improper m*fnhm*D()JI that tubetantlally . of loans.

oompllcatee NIOOVel'J from I plant treneient. aomeha Dated at Rodmlle, Maryland th1a 29th day . balance reJIUUIILtng of July 1991, . .

F~ the ~ Reswatori C'.omudlaion. status.I J\IX:ordtlngl:

' Samual J. Qiillk, .

l FFJEC, Reportina

., Secretary o/1M Comml#Jan. . Return of. Loan With

  • Aocrual 8tatoa: Notice

~ Doc. 91.:.~ Plied ~l-!1- 8:45 am) (March l& 1191} (&8 PR RJJIMc:ooalllO-OMI

  • Jd.. &e Fil at 1140,
  • 91 DV -4 P4 :40 NUCLEAR REGULATORY COMMISSION

,... :.. ~ 'l :._  ;- i.,, T/\ h -/

10 CFR Part 2 01JCI\~ ! 111:; .. , ;  ! 1Cf ii,, ,\NL" Policy and Procedures for Enforcement Actions; Policy Statement, Correction AGENCY: Nuclear Regulatory Commission.

ACTION: Policy statem7ction,

SUMMARY

This action corrects the Commission's statement of policy and procedure for NRC enforcement actions codified as Appendix C to 10 CFR Part 2. On August 2, 1991 (56 FR 36998), the Nuclear Regulatory Commission published a policy statement in the Federal Register that modified the Commission's Enforcement Policy to add an additional example to the Reactor Operations Supplement involving maintenance related violations and to delete the civil penalty adjustment factor for violations involving maintenance deficiencies. This document inadvertently replaced an example that was added to the Reactor Operations Supplement involving a licensed operator's confirmed positive drug test by a final rule published on July 15, 1991 (56 FR 32066).

This action is necessary to restore the text of Appendix C, Supplement 1, paragraph c.9 that was added in the July 15, 1991, final rule and to correct the paragraph designation of the paragraph added in the August 2, 1991, policy statement.

EFFECTIVE DATE: August 2, 1991.

2 FOR FURTHER INFORMATION CONTACT: JanIBs Lieberman, Director, Office of Enforcement, U.S. Nuclear Regulatory Commission, Washington, DC 20555, Telephone (301) 492-0741.

PART 2 - RULES OF PRACTICE FOR DOMESTIC LICENSING PROCEEDINGS

1. The authority citation for part 2 continues to read in part as follo\'.*s:

Authority: Sec 161~ 68 Stat, 948, as amended (42 U.S.C. 2201); sec. 201, 88 Stat. 1242, as amended (42 U.S.C. 5841).

2. Appendix C, Supplement 1, is corrected by revising example c.9 and by adding example c.10 to read as follows:

Appendix C - General Statement of Policy and Procedure for NRC Enforcement Actions Supplement I - Severity Categories Reactor Operations C. Severity Level III-Violations irivolving for example:

3

9. A licensed operator's confirmed positive test for drugs or alcohol that does not result in a Severity Level I or II violation.
10. Equipment failures caused by inadequate or improper maintenance that substantially complicates recovery from a plant transient.

Dated at Rockville, Maryland this KfL day of £Z*-/2Ji~ 1991.

For the Nuclear Regulatory Commission.

,47~ ,44 ~

Donnie Grimsley, D1reccir Division of Freedom of Information and Publications Services Office of Aami~istration

NUCLEAR MANAGEMENT AND RESOURCES COUNCIL 1776 Eye Street, NW.

  • Suite 300
  • Washington, DC 20006-2496 (202) 872-1280 '91 SEP -- 9 P3 :25 Byron Lee, Jr.

President & Chief September 5, 1991 .I Ci< ~ ;\t-:. .,

Executive Officer (' ! t ~ \ f

-f-i Mr. Samuel J. Chilk Secretary of the Commission U.S. Nuclear Regulatory Commission Washington, D. C. 20555 ATTENTION: Docketing and Service Branch RE: 10 CFR Part 2, Appendix C Policy and Procedures for Enforcement Actions; Policy Statement Modification (56 Fed. Reg. 36998 - August 2. 1991)

Dear Mr. Chilk:

By a Federal Register notice dated August 2, 1991, the NRC solicited comments for modification to 10 C.F.R. Part 2, Appendix C, involving maintenance related violations of NRC regulations. These comments are submitted by Nuclear Management and Resources Council, Inc. (NUMARC) 1 to supplement the comments NUMARC submitted on February 6, 1990, in response to the NRC's notice of December 8, 1989, that revised its policy statement on maintenance to include escalated enforcement action for violations involving maintenance deficiencies.

In our February 6, 1990, comments, we described our concern with the Commission's adoption of escalated enforcement actions for maintenance deficiencies. We had advocated that the NRC had the ability, under existing regulations and enforcement practices, to escalate a civil penalty on the merits of an issue and that it was inappropriate to specifically single out maintenance failures as a unique escalating factor in assessing civil penalties . We are pleased that the Commission now believes it appropriate to modify its policy statement to fully integrate maintenance within its general enforcement policy. We believe this step is fully consistent with the Commission's objectives to encourage continued improvement in maintenance programs and practices. We also believe the industry's commitment to 1

NUMARC is the organization of the nuclear power industry that is responsible for coordinating the combined efforts of all utilities licensed by the NRC to construct or operate nuclear power plants, and of other nuclear industry organizations, in all matters involving generic regulatory policy issues and on the regulatory aspects of generic operational and technical issues affecting the nuclear power industry. Every utility responsible for constructing or operating a commercial nuclear power plant in the United States is a member of NUMARC. In addition, NUMARC's members include major architect/engineering firms and all of the major nuclear steam supply system vendors.

U.S. NUCLEAR REGULATORY COMMISSION DOCKETING & SERVICE SECTION OFFICE OF THE SECRETARY OF THE COMMISSION Document Statistics Postmark Date Cf I Copies Received......,.__ _ _ _ _ __

Add'I Copies Reproduced _..5.._____

Special Distribution PR J:- D S

  • e.. he"' O"\

Mr. Samuel J. Chilk September 5, 1991 Page 2 improving maintenance programs and practices is the reason no escalated enforcement actions were taken under the Revised Policy Statement on Maintenance of Nuclear Power Plants (December 8, 1989).

We also believe it appropriate that the Commission chose to integrate maintenance into its enforcement policy by way of adding an example to Appendix C rather than to adopt some prescriptive formulation. We assume that both the specific wording of the example and its placement in Severity Level III are meant to convey that the safety significance of any maintenance deficiency will, like any other violation of NRC regulations, be determinative of the appropriate Severity Level assigned to that violation. However, we are concerned that, in the field, examples can be interpreted to be criteria, which of course would be incorrect. We believe appropriate monitoring by NRC staff's senior management should result in proper and consistent implementation.

As we described to the Commission in our letter on maintenance dated August 16, 1991, the industry intends to proceed aggressively to develop a method of implementation of the NRC's maintenance rule that will satisfy the industry's objectives and provide an appropriate regulatory basis for the NRC in the maintenance area. As we proceed to work with NRC staff and the Commission to address issues that may arise during the development of guidance and the incorporation of that guidance into licensee maintenance programs, it will be important for the Commission to actively monitor the process to ensure that innovative ideas are encouraged and that licensees are not penalized for pursuing new initiatives during the critical developmental phase that subsequent experience demonstrates were not productive.

We would encourage the Commissioners or NRC staff to contact us if they have any questions regarding the industry's perspective on this important matter.

Sincere: £1:

BLjr/RWB:bjb

DOCKET NUMBER PR PROPOSED RULE.__,:;._,....__

WINSTON & STRAWN '£ Ft?

[ '.'CK[T[O 6

(jJ U:)~WC FREDERIC K H . WIN STON (1853-1886) 1400 L STREET, NW C HI CAGO O FFICE WASHI NGTON , D.C. 20005-3502 35 W EST WAC KER D RI V E SILAS H. STRAWN (1891 -1946)

CHICAGO, ILLINOIS 60601 (202) 371-5700

'91 EP - S P.11 :CS (3 12) 558-5600 N EW YO R K O F FICE FAC SIMILE (202) 371-5950 175 WATER STREET N EW YO RK, NY 10038-4981 (212) 269-2500 September 4, 1991 Mr. Samuel J. Chilk Secretary of the Commission U.S. Nuclear Regulatory Commission Washington, D.C. 20555 Attention: Docketing and Service Branch Re: Revision to Policy and Procedure for Enforcement Actions, Based on Maintenance Rule {56 Fed. Reg. 36998)

Dear Mr. Chilk:

On August 2, 1991 the Nuclear Regulatory Commission

("NRC" or "Commission") published in the Federal Register and made immediately effective a revision to the NRC's General Statement of Policy and Procedure for NRC Enforcement Actions (10 C.F.R. Part 2, Appendix C}. See 56 Fed. Reg. 36998. Although the revision is presently in effect, the Commission invited public comments. We appreciate the opportunity to submit the following comments.

1. Summary The NRC' s latest revision to the Enforcement Policy follows a related revision in 1989 that allowed escalation of a base civil penalty if the cause of a violation was determined to be maintenance-related. See 54 Fed. Reg. 50610 (Dec. 8, 1989).

The latest revision deletes the maintenance escalation factor and -- in conjunction with the NRC's newly promulgated maintenance rule -- creates a new example of a Severity Level III violation:

"Equipment failures caused by inadequate or improper maintenance that substantially complicates recovery from a plant transient . "

While we certainly agree with the Commission's decision to delete the maintenance escalation factor, we believe that adoption of the new Severity Level III example is premature.

The new maintenance rule was approved by the Comm i ss i on on July 10, 1991 (56 Fed. Reg. 31306) but has an effective date of July 10, 1996. While the Commission determined that five years were required to allow the industry time to implement maintenance programs, the Enforcement Policy revision would allow the NRC Staff

L, .$ NUCLEAR REGULATORY COMMISSION DOCKETING & SERVICE SECTION OFFICE OF THE SECRETARY OF THE COMMISSION Docu;nant Statistics Postmark D:tte N o rJ ~

Copies Receivt:Jd_-'- 1_ _ _ _ __

Add'I Copies Reproduced -=3=----- - - -

Sp~cial Distribution ~ "R 1: Sn L e. b-e'W"m""n

WINSTON & STRAWN Mr. Samuel J. Chilk September 4, 1991 Page 2 to immediately classify certain maintenance-related problems as Severity Level III violations. This revision to the Enforcement Policy could be construed in implementation to effectively impose new substantive requirements on licensees during the interim period prior to effectiveness of the maintenance rule. In addition, the revision is unnecessary in that the current Enforcement Policy already provides the NRC with an adequate basis on which to take enforcement for safety significant violations that were caused by faulty maintenance (or by any other factor).

We also believe that the new example to be added to the Enforcement Policy -- without the benefit of regulatory guidance still to be published is unbounded with respect to the definitions of "inadequate" or "improper" as they relate to maintenance. The NRC does not expect to publish for another two years t.he regulatory guide for implementing the new maintenance rule.!/

For these reasons, we respectfully submit that the NRC should rescind this revision to the Enforcement Policy, pending effectiveness of the maintenance rule. Violations resulting from maintenance problems should continue to be enforced under the existing Enforcement Policy. 11

2. Discussion The Commission's revision to the Enforcement Policy is an attempt to reflect in the Enforcement Policy the Commission's recent emphasis on maintenance at nuclear power plants.

Notwithstanding the merits of this emphasis, and the recognized importance of maintenance to effective plant performance, the timing of the Enforcement Policy revision is problematic.

!/ ~ 56 Fed. Reg. at 31309.

y We also note that a backfitting analysis has not been conducted in conjunction with the Enforcement Policy revision.

To the extent that this example will effectively impose substantive requirements on licensees in individual enforcement cases, a backf it analysis is warranted. The NRC' s backfitting rule, 10 C.F.R. S 50.109 (1989), requires that new rules or new Staff positions be formally justified in accordance with the backfitting standard. Although the NRC may argue that the revision is a "policy" and not subject to the backfitting rule, it is, as discussed below, a new Staff position that effectively establishes new substantive requirements ( ~ , "proper" and "adequate" maintenance) in advance of the generic maintenance rule.

WINSTON & STRAWN Mr. Samuel J. Chilk September 4, 1991 Page 3 Principally, the Commission has substantively addressed maintenance in its recent rule. However, the revision to the Enforcement Policy precedes the published effective date of the new maintenance rule by five years and therefore could effectively impose new requirements in the interim. The ryjw maintenance rule will not take effect until July 10, 1996, yet the revision to the Enforcement Policy is immediately effective. Therefore, we believe that it is inappropriate to add this example pending the effective date of the maintenance rule.

The purpose for the five year delay in effectiveness of the maintenance rule was to accommodate both the two years that the Commission expects for the implementing regulatory guide to be published, and the three years the Commission will allow for licensees to evaluate the scope of affected equipment at their facility. The Enforcement Policy revision could, if misapplied, undermine the implementation period by making maintenance-related problems immediately sanctionable at a predetermined and escalated severity level (Severity Level III). Further, the revision calls for applying sanctions to maintenance-related problems before a regulatory guide on maintenance is published. Without the necessary guidance, sanctions would be left open to arbitrary and possibly selective application in individual enforcement actions.

Implicit in the five year implementation period for the maintenance rule is an acknowledgement that immediate compliance with this new, substantive requirement is not necessary or practicable. Licensees will need time not only to learn the elements of an acceptable maintenance program, but to adjust their existing maintenance programs to the new requirements (and perhaps change their programs completely). Yet this acknowledgement that five years are required for full implementation is inconsistent with immediate sanctions for maintenance problems at a severity level that allows civil penalties. An effective rulemaking process allows time for affected persons to adapt to new, substantive requirements before imposing penalties for a failure to do so.

Pending effectiveness of the maintenance rule, and without this new Severity Level III example, the NRC has ample regulatory means to address its safety concerns including maintenance. If facility maintenance leads to inoperable equipment, for example, the NRC can cite violations against an applicable legally binding requirement (~, Technical 56 Fed. Reg. 31306.

WINSTON & STRAWN Mr. Samuel J. Chilk September 4, 1991 Page 4 Specifications).!/ The severity of the violation can be established, consistent with the current Enforcement Policy, in accordance with the sai,ty and/or "regulatory" significance of the inoperable equipment. In this context, it is completely unnecessary to single-out and categorically predetermine all significant maintenance problems as Severity Level III violations.

In a similar vein, we are concerned that the new severity Level III example could be applied and enforced with the same effect as a regulation. The Policy revision could be construed and applied to effectively impose new obligations on licensees to

  • perform "adequate" or "proper" maintenance. Prior to the effectiveness of the maintenance rule, this type of "policy" allows the Staff substantial discretion -- in the enforcement context --

to define what maintenance program should be in place.

approach to rulemakinq . is inconsistent with the Administrative Procedure Act ("APA") .v The APA demonstrates a preference that This agency actions imposing new generic requireunts be preceded by public notice and an opportunity to comment.

Of course, the uni verse of binding legal requirements that can be cited in a notice of violation would specifically exclude the maintenance rule prior to its effectiveness. We believe that the NRC Staff should be specifically instructed that the maintenance example is Il.Qt a binding regulation.

Moreover, experience teaches that "regulatory" significance is an extraordinarily flexible concept -- one the NRC can certainly utilize to consider global concerns in a severity level determination.

§./

5 u.s.c. S 551, et seq.

5 u.s.c. S 553; Vermont Yankee Nuclear Power Corp. v. Natural Resources Defense council, 435 u.s. 519, 523-24 (1978). It should be noted that this Enforcement Policy revision arguably falls within the APA definition of a "rule". The APA in S 551(4) broadly defines a rule as:

The whole or a part of an agency statement of general or particular applicability and future effect designed to implement, interpret, or prescribe law or policy or describing the organization, procedure, or practice requirements of an agency . . .

(continued ... )

WINSTON & STRAWN Mr. Samuel J. Chilk September 4, 1991 Page 5 Apart from the question of whether this Policy revision improperly anticipates effectiveness of the new maintenance rule, V ( ... continued)

(emphasis added). One issue is whether the statutory exception to notice and comment of S 553(b) {A) is applicable.

See Community Nutrition Institute v. Young, 818 F.2d 943, 945 at n.2 (D.C. Cir. 1987). However, in this regard, where an agency action imposes generic requirements, courts will look behind the agency's label ( ~ , a "policy") to determine whether the action is in reality a substantive rule requiring prior notice .and comment. ~ Mt. Diablo Hospital District

y. Bower, 860 F.2d 951, 956 (9th cir. 1988); General Motors Corporation y. Ruckelshaus, 742 F.2d 1561, 1565 (D.c. cir.

1984), cert. denied, 471 U.S. 1074 (1985). The amount of weight a court will give an agency's label is slight; in fact, it has been wryly described as "not overwhelming." Brock v.

Cathedral Bluffs Shale Oil Co., 796 F.2d 533 (D.C. Cir. 1986)

(" . . . there is deference and there is deference -- and the degree accorded to the agency on a point such as this is not overwhelming").

The appearance of this revision in the Code of Federal Regulations (CFR) is further evidence that the revision could be construed to be a substantive rule. In the cathedral Bluffs case, Justice Scalia, then a judge on the D.C. Circuit Court of Appeals, stated:

The real dividing point between regulations and general statements of policy is publication in the Code of Federal Regulations, which the statute authorizes to contain only documents "having general applicability and legal effect," 44 U.S. C.

S 1510 (1982), and which the governing regulations provide shall contain only "each Federal regulation of general applicability and current or future effect," 1 C.F.R. S 8.1 (1986).

Cathedral Bluffs, 796 F. 2d at 539 ( emphasis in original) . The cathedral Bluffs case concerned an agency that had enforcement authority similar to that of the NRC. That agency, however, published its enforcement policy in the Federal Register, not in the CFR, thus assisting the court in finding that the actions involved were indeed policy rather than rules.

WINSTON & STRAWN Mr. Samuel J. Chilk September 4, 1991 Page 6 we are also troubled by the lack of definition of key terms used in the revision. Specifically, terms such as "inadequate or improper" and "substantially complicates" appear to be unbounded in any technical sense. This lack of definition is aggravated by the fact that appropriate regulatory guidance is not expected to be published for two years. This leaves individual inspectors free to apply their own version of what constitutes "inadequate - or improper" maintenance, or what "substantially complicates" a recovery from a plant transient. This lack of precision will inevitably lead to arbitrary application of sanctions.

3* Conclusion For the foregoing reasons, we urge the Commission to rescind this revision to the Enforcement Policy pending effectiveness of a legally binding maintenance rule. We believe maintenance-related violations can be effectively addressed in the interim under the current NRC Enforcement Policy. We appreciate this opportunity to provide input into the enforcement process.

Respectfully submitted,

~~~~~

Nicholas S. Reynolds David A. Repka Ronald B. Vogt

1,1vvKET NUMBER PR 'I) s 6 PROPOSED RULE J.-

( £° {, Frt 3~ 11' i'_) 1s*su-u1 NUCLEAR REGULATORY COMMISSION COlK L1ED US NHC 10 CFR Part 2 '91 JUL 31 A8 :Q3 Policy and Procedure for Enforcement Actions; Policy Statement Agency: Nuclear Regulatory Commission ,

Action: Policy Statement: Modification\

The NRC is publishing a modification to its Enforcement Policy to add an additional example to the Reactor Operations Supplement involving maintenance related violations and to delete the civil penalty adjustment factor for vi o1ati ons i nvo 1vi ng maintenance defi ci enci es. This policy is codified as Appendix C to 10 CFR Part 2.

Date: Since this action concerns a general statement of policy, no prior notice is required and, hence, this modification of the Enforcement Policy is effective upon issuance. Comments submitted within 30 days of publication of this modification will be considered.

Address: Send corrrnents to: Secretary, U.S. Nuclear Regulatory Corrmission, Washington, DC 20555, ATTN: Docketing and Service Branch. Deliver comments to One White Flint North, 11555 Rockville Pike, Rockville, Maryland 20852, between 7:30 am and 4:15 pm, weekdays. Copies of comments received may be examined at the NRC Public Document Room, 2120 L Street N.W., Lower Level, Washington, DC.

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For Further Infonnation

Contact:

James Liebennan, Director, Office of Enforcement, U.S. Nuclear Regulatory Corronission, Washington, DC 20555, Telephone (301) 492-0741.

Supplementary Information: On March 23, 1988, the Commission issued a Policy Statement on Maintenance of Nuclear Power Plants (53 FR 9430) which stated the

  • C0111Tiission 1 s expectations in the area of maintenance and the intention to proceed with a rulemaking on maintenance. Subsequently, on November 28, 1988, the Comnission published a Notice of Proposed Rulemaking (53 FR 47822) directed toward improving the effectiveness of maintenance programs. Based on addi-t:fonal information received after publication of the Policy Statement and the Notice of Proposed Rulemaking, the Conmission decided to hold rulemaking in abeyance for a period of 18 months from the effective date of the Revised Policy Statement on Maintenance of Nuclear Power Plants which was published December 8, 1989 (54 FR 50611)
  • In the Revised Policy Statement on the Maintenance of Nuclear Power Plants, the Conmisston stated its intent in enforcing existing requirements for power reactors to emphasize maintenance. Consistent with that position, the Enforcement Policy was revised to provide such emphasis by adding maintenance failures as an escalating factor in assessing civil penalties where it has been concluded that the violation involves a significant regulatory concern.

54 FR 50611 (December 8, 1989).

The Conmission promulgated the final maintenance rule, Monitoring the Effective-ness of Maintenance at Nuclear Power Plants on July 10, 1991 (56 FR 31306) and is now deleting the maintenance escalation factor and replacing it with a specific example of a Severity Level III violation involving maintenance activities in Supplement I of the Enforcement Policy. This change will continue to emphasize the Co111Tiission's intent to enforce existing requirements while at the same time normalize treatment of maintenance in the enforcement process

  • Previously, maintenance as a root cause was the only functional area with a separate escalation factor. The Conmission has concluded that placing an example concerning maintenance in Supplement I fits more appropriately in the overall structure of the Enforcement Pol icy and wi 11 provide the appro-priate flexibility to deal with various maintenance issues. Significant deficiencies in the performance of maintenance activities that impact plant equipment where a violation is involved may be considered a significant regulatory concern. The added example provides notice consistent with the
  • final rule that appropriate maintenance is expected to be conducted for both safety-related and applicable balance of plant systems.

List of Subjects in 10 CFR Part 2 Part 2 - Administrative practice and procedure, Antitrust, Byproduct material, Classified information, Civil penalty, Enforcement, Environmental protection, Nuclear materials, Nuclear power plants and reactors, Penalty, Sex discrimina-tion, Source material, Special nuclear material, Violations, and Waste treatment and disposal.

Part 2 Rules of Practice for Domestic Licensing

1. The authority citation for Part 2 continues to read in part as follows:

AUTHORITY: SEC. 161, 68 Stat. 948, as amended (42 U.S.C. 2201); sec. 201, 88 Stat. 1242, as amended (42 U.S.C. 5841) .

  • 2. Appendix C Section V.B is amended by deleting subsection Section V.B.7.

Appendix C Supplement I is amended by adding example C.9 after example C.8.

Appendix C - General Statement of Policy and Procedure for NRG Enforcement Actions Supplement I - Severity Categories Reactor Operations

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c. Severity Level III - Violations involving for example:
9. Equipment failures caused by inadequate or improper maintenance that substantially complicates recovery from a plant transient.

Dated at Rockville, Maryland thi~ ______ day o f ~ 1991.

THE LEAR REGULATORY COMMISSION the Commission

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