ML20112J828

Licensee Reply Brief on Review of Licensing Board Decision LBP-95-17.* W/Certificate of Svc

ML20112J828
Person / Time
Site:	Perry
Issue date:	06/18/1996
From:	Silberg J SHAW, PITTMAN, POTTS & TROWBRIDGE
To:	NRC COMMISSION (OCM)
References
CON-#296-17701 LBP-95-17, OLA-3, NUDOCS 9606210099
Download: ML20112J828 (12)

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.USNRC UNITED STATES OF AMERICA .

NUCLEAR REGULATORY COMMISSION '96 JUN 20 A7 58 Before The Commission CFFICE DOChCilNC & Cf SEC.JE '

B R A F -' ,

) .

In the Matter of ) l

) Docket No. 50-440-OLA-3 j 1

THE CLEVELAND ELECTRIC ' )

ILLUMINATING COMPANY, et al. ) ~ License Amendment' i

.) (Material Withdrawal Schedule) ,

i (Perry Nuclear Power Plant, )

Unit No.1) ~ )  ;

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LICENSEES' REPLY BRIEF ON REVIEW OF l LICENSING BOARD DECISION LBP-95-17 INTRODUCTION Licensees file this reply brief in response to the "Intervenon' Brief In Suppon Of Commission Affirmation Of LBP-95-17" ("Intervenors' Brief"). At the heart of In-

. tervenors' argument is their. claim that the " Licensing Board's Order is merely an im-plementation" of the decision in Citizens Awareness Network v. NRC,59 F 3d 284

' (1st Cir 1995) ("CAN"). Intervenors' Brief at 9. The Intervenors are mistaken. The I

~ CAN decision does not mandate notice and hearing for NRC approval of reactor ves-

sel material specimen withdrawal schedules or similar approvals required as part of the

- NRC's continuing regulatory ovenight of its reactor licensees. The substantive issue -

which the Coun in CAN found to require notice and hearing was the NRC's ap-proval of disassembly and shipment off-site of major plant components. The First

Circuit found that s,pproval to be beyond the ambit of the originallicense authorizing 9606210099 960618 PDR ADOCK 05000440 0 PDR .

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posses < ion and operation of the plant. Therefore, the First Circuit construed the NRC approval as a defacto license amendment requiring notice and opportunity for hearing.

In this case, the withdrawal of reactor vessel material specimens in acconiance with NRC approved schedules is within the ambit of the existinglicense. Indeed, 1

both the Perry license and concomitant NRC regulations require the withdrawal of such specimens. As such, the NRC's approval of withdrawal schedules for such speci-mens constitutes part of its continuing regulatory oversight of reactor licensees and does not grant new license authority to the licensees. Judicial precedent under both j the Atomic Energy Act (the "Act") and the Administrative Procedure Act ("APA")-

I cited in Licensees' brief but ignored by Intervenors in their sole reliance on CAN -

establish that such regulatory approvals do not trigger notice and hearing requirements.

Three other points are raised in Intervenors' brief. First, Intervenors have mis-read Licensees' materiality argument (Licensees' Brief at 21-23) as solely a disagreement with the Board's interpretation of 10 C.F.R. Part 50 Appendix H. That is incorrect.

Licensees' materiality argument assumes the correctness of the Board's interpretation of the regulation but argues that the Board's order requiring notice and opportunity for hearing for all such approvals erroneously eliminates materiality as a requirement for a hearing under section 189a. Second, Intervenors gloss over the inherent ambigu.

ity of 10 C.F.R. Pan 50 Appendix H,5 II.B.3 in arguing that any proposed with-drawal schedule (initial, changed or otherwise) is a " proposed schedule" within the meaning of the regulation. In doing so, they would have the Commission ignore the Staff's reasonable interpretation of the regulation based on its history. Third,  ;

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Intervenon erroneously argue that reversal of the Board's decision would deny the l public its rightful role in assuring the safe operation of nuclear power plants. Interve- l nors completely ignore, however, the role of 13 C.F.R. 5 50.59 in assuring public par-1 ticipation on issues 'affecting public health and safety. This regulatory provision l assures that Intervenors and other members of the public will be provided notice and j 1

opportunity for hearing on significant changes to withdrawal schedules for reactor J

vessel material specimens that raise unreviewed safety questions.

l I. The CAN Decision Is Not Controlling

. Intervenors overreach greatly in their reading of the CAN decision. They cite CAN for the broad proposition "that a licensee action for which NRC approval is re-quired prior to implementation already is a license amendment, even if it is not explic-itly designated as such," and is " subject to the public hearing provisions of the

[ Atomic Energy Act]." Intervenon' Brief at 2-3 (emphasis in original). The First Cir-cuit did not, however, lay down the broad tule of law enunciated by Intervenors. To the contrary, the First Circuit held that the NRC's approvalin that case triggered no-tice and hearing under section 189a only "to the extent [the approval] substantially en-larged the authority of an extant licensee. . . ." 53 F.3d at 294 (emphasis in original).

The First Circuit found the disassembly and shipment off-site of major plant components to be such an enlargement of license authority. 53 F.3d at 294-95.

Here, in contrast, the withdrawal of reactor vessel material specimens in accordance with NRC approved schedules is within the scope of the extant license. j The Perry technical specifications specifically provide for the withdrawal of such specimens in accordance with NRC regulations, which would include schedules as i

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i approved by the NRC.M In terms of the CAN decision, withdrawal of reactor vessel material specimens in accordance with NRC approved schedules is "[r]egulated con-duct . . . delineated [or] reasonably encompassed within delineated categories of authorized conduct" under the existing license. 53 F.3d at 294. Therefore, the NRC's approval of reactor vessel material specimen withdrawal schedules under 10 C.F.R. Part 50 Appendix H,5 II.B.3 is not a grant of new license authority. Rather, these and similar regulatory approvals (see note 11 in Licensees' Brief) are pan of the NRC's continuing regulatory oversight of its reactorlicensees and do not enlarge the author-ity of extant licenses.

The First Circuit's analysis in CAN reflects that the court did not intend to transform such NRC regulatory approvals into license amendments. In distinguishing the factual circumstances of Commonwealth of Massachusetts v. NRC,878 F.2d 1516 (1st Cir.1989) (discussed in Licensees' Brief), the First Circuit noted that the require-ments imposed and approved by the NRC for the restart of the Pilgrim plant in that case "were simply additionalinterim license restrictions -imposed pursuant to pre-cristing Commission regulations - none of which conflicted with, or required the al-teration of any term of the originallicense." 59 F.3d at 295, note 11 (italicized empha-sis in original; underlined emphasis added). Similarly, here the NRC's approval of HThe Perry technical specifications (section 4.4.6.1.3) provide as amended by the request to remove the withdrawal schedule from the specifications as follows:

The reactor vessel material surveillance specimens shall be removed and examined, to determine changes in reactor pressure vessel mate-rial properties as required by 10 CFR 50, Appendix H. The results of these examinations shall be used to update the curves of Figure 3.4.6.11.

,See Letter from James R. Hall (NRC) to Michael D. Lyster (CEI), dated December 18,1992, issuing Amendment No. 45 to the Perry operating license; and " Notice of Issuance of Amendment to Facility Operating License," 58 Fed. Reg. 5,427,5,438 (1993).

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withdrawal schedules under 10 C.F.R. Pan 50 Appendix H,5 II.B.3 is imposed pursu-ant to existing regulations and does not conflict with or require the alteration of any term of the Perry license. See also Kelley v. Selin,42 F.3d 1501,1515 (6th Cir.), cen.

denied,115 S. Ct. 2611 (1995) (declaring in similar circumstances that "[t]here is no li-censing decision being made here") (discussed in Licensees' Brief).

Intervenors do not discuss or attempt to distinguish Commonwealth of Massa-

. chusetts, Kelley or the other judicial decisions cited in Licensees' brief because, ac-cording to Intervenors, these decisions "are simply no longer controlling" in light of the CAN decision. Intervenors' Brief at 3. That assenion is plainly wrong as shown by the discussion in CAN _ of Commonwealth of Massachusetts, where the First Cir-cuit approved but distinguished (as discussed above) the holding of its earlier decision in the Commonwealth case. The cases discussed in Licensees' brief are not inconsis-tent with CAN, properly interpreted and applied as above. These decisions, uni- 1 formly with CAN, show that the NRC's approval of reactor vessel material specimen withdrawal schedules under 10 C.F.R. Pan 50 Appendix H,5 II.B.3, and similar regu-latory approvals, are part of the NRC's continuing regulatory oversight of its reacton licensees and do not trigger statutory hearing rights under section 189a of the Act.

II. Intervenors Ignore Relevant APA Case Law Intervenors argue that the breadth of the APA provisions defining " license" and " licensing" supports their position that regulatory approvals under 10 C.F.R.

Pan 50 Appendix H,5 II.B.3 are amendments within the meaning of section 189a of the Act. . Sg Intervenors' Brief at 7-8. Ietervenors ignore and fail to distinguish, how-ever, the leading case that considers whether approvals granted as part of an agency's .

1 day to-day administration of its regulations constitute " licensing" under the APA.

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9 American Cylinder Manufacturers Comm. v. Department of Transportation,578 F.2d 24 (2d Cir.1978). That case (discussed in both the Licensees' and Staff's briefs) con-cluded that such agency action does not fall within the APA definition of licensing.

Thus, judicial precedent applying the APA definitions of license and licensing sup-pons the conclusion that NRC approvals made in the course of exercising its regula-tory oversight of reactorlicensees are not license amendments requiring notice and opportunity for hearing under section 189a of the Act.

III. Intervenors Misread Licensees' Materiality Argument Intervenors recast Licensees' materiality argument as mere disagreement with the Board on the correct interpretation of 10 C.F.R. Part 50 Appendix H,5 II.B.3.

See Intervenors' Brief at 4. That is incorrect. Licensees' materiality argument (Licen-sees' Brief at 2123) assumes (for the sake of argument) that the Board correctly inter-preted 10 C.F.R. Part 50 Appendix H,5 II.B.3 to require prior NRC approval for all i changes to reactor vessel specimen withdrawal scnedules. Even with this assumption, however, the Board erred in requiring notice and opportunity for hearing for all such approvals because that conclusion would eliminate materiality as a requirement for a l heanng under section 189a. The Board's decision would require notice and opponu-nity for hearing even with respect to changes that comply with the ASTM E 185 stan-dards incorporated into Appendix H, which the NRC has previously determined satisfy NRC safety requirements.

Intervenors suggest (in responding to the Staff's similar argument) that, because a hearing is offered for correction of typographical errors in technical specifications, an opponunity for hearing is required here. See Intervenors' Brief at 6-7. Technical specifications, however, comprise part of the actual license and any changes, even 6

typographical changes, require a license amendment. See 10 C.F.R. 5 50.59(c).22 With respect to changes to the nuclear facility or to the procedures described in the safety analysis report, such as the withdrawal schedule,10 C.F.R. 5 50.59 requires a license amendment (with concomitant notice and opportunity for hearing under section 189a) only for those changes that are material to the.public health and safety - i.e., m- l l

volve an unreviewed safety question. This structure of the NRC's regulations com-J ports with the judicial precedent cited in Licensees' brief, as well as the CAN decision i

relied upon by Intervenors. As stated by the First Circuit in CAN:

i If the proposed change is inconsistent with the license, or does involve an unreviewed safety question (as that term is defined in 10 C.F.R. 5 50.59(a)(2)(ii)), the licensee must apply to the Commission for a license amendment, 10 C.F.R. 5 50.59(c), and only then are the statutory hear-  :

l ing rights of 5189a triggered.

59 F.3d at 287 (emphasis added).

IV. Intervenors Gloss Over The Inherent Ambiguity Of Appendix H, $ II.B.3 i

Intervenors argue that the requirement of 10 C.F.R. Part 50 Appendix H,5 i II.B.3 for a " proposed withdrawal schedule" to be approved " prior to implementation" l

. is unambiguous because "[a]ny proposed schedule is a proposed schedule," whether an initially proposed schedule or proposed change to a previously approved initial sched- )

ule, or a proposed schedule in conformance or non-conformance with the require-ments of ASTM E 185 (incorporated by reference into 10 C.F.R. Part 50 Appendix I

- H). Intervenors' Brief at 5. Intervenors' argument glosses over the ambiguity inher-ent in the language of Appendix H,5 II.B.3. Under Intervenors' rationale, it would be E10 C.F.R. $ 50.59(c) provides in part that "[t]he holder of a license authorizing operation of a produc.

' tion or utilization facility who desires (1) a change in technical specifications . . shall submit an appli-cation for amendment of his license pursuant to 5 50.90."

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unnecessary for the Act and the NRC regulations to distinguish between an initialli-cense and an amendment to a previously issued license because a license is a license and change to a license is also a license. Yet the Act and the regulations do distinguish be-tween an initial license and an amendment to an existing license.

It is therefore reasonable and necessary to review the history of the regulation, as done by the Staff, to determine the meaning of the regulation that best accom-plishes its intent. As explained in the Staff's brief, at the time the current version of Appendix H,5 II.B.3 was promulgated, the NRC simultaneously deleted from Appen-dix H specific withdrawal schedules previously required of licensees because the re-quirements for withdrawal schedules contained in ASTM E 185, incorporated by reference into the regulation, satisfied NRC safety requirements. Therefore, the Staff concluded that, because the Commission had already approved (in promulgating the revisions to Appendix H) the implementation of withdrawal schedules in accordance with ASTM E 185 requirements, Appendix H,5 II.B.3 should be interpreted to re-quire prior NRC approval only for withdrawal schedules that deviate from ASTM E 185 standards. The Staff's interpretation is reasonable, panicularly since NRC ap- ,

1 proval of withdrawal schedules prior to the revision of Appendix H was limited to schedules that deviated from the requirements set out in the Appendix at that time. l The Commission should therefore adopt the Staff's interpretation of Appendix H,5 II.B.3 based upon the history of the regulation.

V. Intervenors Ignore Role Of 50.59 In Matters Of Public Health & Safety Intervenors claim that they cannot " fulfill [their) role" if the right to a hearing is denied with respect to future changes to reactor vessel specimen withdrawal sched-ules (or with respect to other items removed from plant technical specifications). )

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Intervenors' Brief at 9. Aside from the circularity of their argument (ig, their role is what they say it is), Intervenors nowhere mention the role played by 10 C.F.R. 5 50.59 in assuring the public's involv.: ment in matters concerning public health and safety. Under 10 C.F.R. 5 50.59, license amendments are required for proposed changes to the facility or procedures described in the safety analysis report (or to con-duct tests or experiments not described in the safety analysis repon) "which involve an unreviewed safety question." 10 C.F.R. 5 50.59(c). The reactor vessel specimen withdrawal schedule will be part of the Perry safety analysis report. Therefore, future changes to the withdrawal schedule proposed by Licensces that involve an unreviewed safety question would require a license amendment with notice and opponunity for hearing under section 189a of the Act. The requirement of 10 C.F.R. 5 50.59(c) for li-cense amendments for proposed licensee activities involving unreviewed safety ques-4 tions assures continued public involvement with respect to matters involving public health and safety.

Further,10 C.F.R. 5 2.206 provides an additional avenue for Intervenon and other public involvement on matters concerning public health and safety. Under 10 C.F.R. 5 2.206(a), any member of the public can file a request for the NRC to institute a proceeding to " modify, suspend, or revoke a license, or for such other action as may be proper." As stated by the court in Massachusetts Public Interest Research Group v.

NRC, 852 F.2d 9,11 (1st Cir.1988), "NRC monitoring of its licensees is supple-mented by 10 C.F.R. $_2.206 which provides for public participation in enforcement activity."

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h CONCLUSION I

For the foregoing reasons, and those set fonh in Licensees' brief of April 26,'

1996, the Commission should revene the Board's Memorandum and Order, >

LBP-95-17,' issued October 4,1995. Neither the Atomic Energy Act nor principles of administrative law require notice and opportunity for hearing of NRC approvals un - .

der 10 C.F.R. Part 50 Appendix H,5 II.B.3, and similar regulatory approvals (see note 11 in i.icensees' Brief), required by the NRC as part of its continuing regulatory over-sight of reactor licensees, as would be mandated by the Board's Memorandum and Or-

' der. To require the NRC to hold hearings on approvals it has seen fit to include in its j

' day-to-day regulation of reactorlicensees would be an unwarranted intmsion into the regulatory affairs of the Commission and needlessly complicate the NRC's regtdatory ovenight of its licensees as entrusted to the NRC by the Congress. j t

Respectfully submitted, 4

Shaw, Pittman, Potts & Trowbridge j j --

2300 N Street, N.W.

' Washington, D.C. 20037 ,

A b 4 J8E[Silbfrg J-

Paul A. Gaukler Counsel for Licensees Dated

June 18,1996 10

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DOCKETED USNiiC UNITED STATES OF AMERICA

- NUCLEAR REGULATORY COMMISSION 3 JUN 20 A7 :58 i

Before The Comminion DFFICE OF SECPEIART DOCKETlHG & EERV!Ct BR/ M

)

. In the Matter of .) .

)' Docket No. 50-440-OLA-3 j THE CLEVELAND ELECTRIC )_

ILLUMINATING COMPANY, et al. ') . License Amendment  !

l

) (Material Withdrawal Schedule) 7 (Perry Nuclear Power Plant, )-

Unit No.1) ) .j

.)

i CERTIFICATE OF SERVICE 7

I hereby certify that copies of the foregoing Licensees' Reply Brief On Review

of Licensing Board Decision LBP-95-17 were sent on June 18,1996 by first class mail, postage prepaid, to the persons on the attached List.

Shaw, Pittman, Potts & Trowbridge 2300 N Street, N.W.

Washingto , ).C. - 20037 Y OLL Paul A.Gaukler l Counsel for Licensees i

Dated: June 18,1996  ;

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UNITED STATES OF AMERICA f

~ NUCLEAR REGULATORY COMMISSION i ' Before The Commiuion

)'- -

2 In the Matter of )

) Docket No. 50440-OLA-3 i

THE CLEVELAND ELECTRIC )

^

ILLUMINATING COMPANY, et al. . ) License Amendment

) (Material Withdrawal Schedule)

, (Perry Nuclear Power Plant,' ) l i

Unit No.1) )

-)

.j SERVICE I IST  !

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Office of the Secretary Dr. Richard F. Cole U.S. Nuclear Regulatory Commission Atomic Safety and Licensing Board Attention: Chief, Docketing and Service U.S. Nuclear Regulatory Commission l

i Section Washington, D.C. 20555

. Washington, D.C. 20555 Sherwin E. Turk, Esq. Dr. Charles N. Kelber

- Office of the General Counsel Atomic Safety and Licensing Board U.S. Nuclear Regulatory Commission U.S. Nuclear Regulatory Commission Washington, D.C. 20555 Washington,D.C. 20555 Thomas S. Moore, Esq. Office of Commission Appellate

, Chairman Adjudication . _

Atomic Safety and Licensing Board U.S. Nuclear Regulatory Commission i U.S. Nuclear Regulatory Commission Washington, D.C. 20555 I .

Washington, D.C. 20555 Ms. Susan Hiatt 8275 Munson Road Mentor, Ohio 44060

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