Text

EA-21-041: Enclosure to January 26, 2022, Letter to Mr. Kelly Trice, President, Holtec NRC Investigation Report & NRC Inspection Confirmatory Order; Issuance. Holtec Decommissioning International, LLC, Oyster Creek Nuclear Generating
	ML21362A447
Person / Time
Site:	Oyster Creek
Issue date:	01/26/2022
From:	Ray Lorson; NRC Region 1
To:	; Holtec Decommissioning International
	Marjorie McLaughlin
References
	EA-21-041 EAW-21-041
	Download: ML21362A447 (28)
	v • d • e

UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION

In the Matter of

)

Holtec Decommissioning International, LLC ) 05000219

)

Oyster Creek Nuclear Generating Station ) DPR-16

)

) EA-21- 041

CONFIRMATORY ORDER MODIFYING LICENSE

I

Holtec Decommissioning International, LLC (HDI or Licensee) is the holder of

Renewed Facility Operating License No. DPR-16 issued on June 3, 2009, by the U.S.

Nuclear Regulatory Commission (NRC or Commission) pursuant to Part 50 of Title 10 of

the Code of Federal Regulations (10 CFR). The license authorizes the operation of

Oyster Creek Nuclear Generating Station (facility) in accordance with conditions

specified therein. The facility is located on the Licensee's site in Forked River, New

Jersey.

This Confirmatory Order is the result of an agreement reached during an

Alternative Dispute Resolution (ADR) mediation session conducted by video conference

on October 14, 2021.

II

On March 13, 2020, the NRC Office of Investigations (OI), Region I Field Office

opened an investigation (OI Case No. 1-2020-007) at Oyster Creek. The investigation,

1 which was completed on March 11, 2021, evaluated whether a (now -former) training

superintendent at Oyster Creek, who was also responsible for performing armorer

duties, deliberately failed to perform firearms maintenance activities and falsified records

related to those activities. Based on the evidence gathered during the investigation, the

NRC determined that the armorer deliberately failed to perform certain required firearms

maintenance activities for calendar year 2019, that the armorer deliberately falsified

records related to these activities, and that these falsified records were submitted to the

NRC in response to an April 10, 2020, information request.

Specifically, the NRC identified that on the Licensees 2019 firearms

maintenance and testing logs that the Licensee submitted to the NRC in response to an

information request for an NRC security inspection, the fields for date and performed

by for annual material condition inspections were left blank, indicating to the NRC that

the Licensee did not conduct this activity. On March 16, 2020, the armorer told an NRC

Region I security inspector that Oyster Creek staff no longer performed this inspection

and that the procedure was being changed to remove the requirement. However, the

armorer acknowledged that the procedure change had not yet happened. Subsequently,

in response to an April 10, 2020, information request from OI, the L icensee resubmitted

its firearms logs to the NRC, and the date and performed by fields were filled out,

which would indicate that the L icensee had completed the annual material condition

inspections. The armorer informed OI that he filled in these fields after talking to the

NRC inspector. He stated that he probably did not perform the inspections but

maintained that he did not exactly remember what he did. The NRC determined that the

annual material inspections were not performed in 2019 due to the armorers deliberate

failure to perform them and that the armorer deliberately falsified the records provided to

the NRC to indicate that the inspections had been performed.

2 The NRC concluded that the deliberate failure of the armorer to perform required

annual material condition inspections of firearms for calendar year 2019 caused the

Licensee to be in violation of Title 10 of the Code of Federal Regulations (10 CFR) Part

73, Appendix B, Criterion VI.G, Weapons, Personal Equipment, and Maintenance, and

procedures required by the Commission-approved Oyster Creek Training and

Qualification Plan. Specifically, 10 CFR Part 73, Appendix B, Criterion VI.G, Weapons,

Personal Equipment, and Maintenance, Section 3(a), Firearms maintenance program,

requires that each Licensee shall implement a firearms maintenance and accountability

program in accordance with the Commission regulations and the Commission-approved

training and qualification plan. The program must include, in part: (1) Semiannual test

firing for accuracy and functionality; (2) Firearms maintenance procedures that include

cleaning schedules and cleaning requirements; (3) Program activity documentation; and

(4) Control and accountability (weapons and ammunition). The Oyster Creek Training

and Qualification Plan is Appendix B to the sites Physical Security Plan. Section 20.5 of

Revision 18 of the Training and Qualification Plan states, in part, that a testing and

maintenance program for all assigned firearms is established to ensure that the firearms

and related accessories function as intended. The program is described in facility

procedures. Oyster Creek procedure SY -AA-150-103, Revision 0, Firearms

Maintenance, Testing, and Accountability, constitutes the facility procedure for the

testing, cleaning, and inspecting of security weapons. Step 4.2.4.2 states, in part,

annually, perform the material condition inspection on all duty firearms. Step 2.3, in

terms and definitions, defines "annual" as once per calendar year.

The NRC determined that the armorers deliberate actions also caused the

Licensee to provide information to the NRC regarding the annual material inspections of

3 firearms that was not complete and accurate in all material respects, contrary to 10 CFR

50.9(a). Specifically, 10 CFR 50.9(a) requires, in part, that information provided to the

Commission by a Licensee or information required by the Commission's regulations to

be maintained by the L icensee shall be complete and accurate in all material respects.

10 CFR 73.70(e) states, in part, that each L icensee subject to the provisions of 10 CFR

73.55 shall keep documentation of all tests, inspections, and maintenance performed on

security related equipment used pursuant to the requirements of this part for three years

from the date of documenting the event. 10 CFR 73.55(a)(1) indicates that the S ection

applies to nuclear power reactor licensees that are licensed under 10 CFR Part 50.

Logs submitted to the NRC in response to an April 10, 2020, information request

documented that annual material condition inspections had been performed on each of

the Licensees duty firearms; however, the L icensee had not performed the inspections.

This information is material to the NRC because the NRC requires testing and

maintenance of weapons to ensure they are in acceptable working condition. Accurate

recordkeeping of such activities ensures that the weapons maintenance program is

fulfilling these requirements.

Through the investigation, the NRC also identified a third violation involving the

failure by the armorer to perform required biennial firearms parts replacement. The NRC

did not find sufficient evidence to conclude that this failure was willful. However, the

failure caused the L icensee to be in violation of 10 CFR Part 73, Appendix B, Criterion

VI.G, Weapons, Personal Equipment, and Maintenance, Section 3(a), Firearms

maintenance program, which requires that each Licensee shall implement a firearms

maintenance and accountability program in accordance with the Commission regulations

and the Commission-approved training and qualification plan. The program must

include, in part: (1) Semiannual test firing for accuracy and functionality; (2) Firearms

4 maintenance procedures that include cleaning schedules and cleaning requirements; (3)

Program activity documentation; and (4) Control and accountability (weapons and

ammunition). The Oyster Creek Training and Qualification Plan is Appendix B to the

sites Physical Security Plan. Section 20.5 of Revision 18 of the Training and

Qualification Plan states, in part, that a testing and maintenance program for all

assigned firearms is established to ensure that the firearms and related accessories

function as intended. The program is described in facility procedures. Oyster Creek

procedure SY-AA-150-103, Revision 0, Firearms Maintenance, Testing, and

Accountability, constitutes the facility procedure for the testing, cleaning, and inspecting

of security weapons. Step 4.2.5, states, replace the following components on duty rifles

biennially: hammer spring, trigger spring, disconnector spring, extractor spring, ejector

spring, and gas rings. SY-AA-150- 103-F-04, Rifle Material Condition Inspection/

Functionality/ Accuracy Tests states, in part, biennially, replace the following

components on contingency rifles and note this as being completed in the weapons

maintenance log. Step 2.7 defines "biennial" as at least once every two years.

By letter, dated July 28, 2021 (Agencywide Documents Access and Management

System (ADAMS) Accession No. ML21176A049), the NRC notified the Licensee of the

results of the in vestigation with an opportunity to: (1) provide a response in writing, (2)

attend a predecisional enforcement conference or (3) to participate in an ADR mediation

session in an effort to resolve this matter.

In response to the NRCs offer, the Licensee requested the use of the NRCs

ADR process to resolve differences it had with the NRC. On October 14, 2021, the NRC

and the Licensee met in an ADR session mediated by a professional mediator, arranged

through Cornell Universitys Institute on Conflict Resolution. The ADR process is one in 5

which a neutral mediator, with no decision-making authority, assists the parties in

reaching an agreement on resolving any differences regarding the dispute. This

Confirmatory Order is issued pursuant to the agreement reached during the ADR

process.

III

During the ADR session, the Licensee and the NRC reached a preliminary

settlement agreement. The elements of the agreement include the following:

Whereas, the NRC acknowledges that HDI has taken several corrective actions in

response to the violations at Oyster Creek Nuclear Generating Station (Oyster Creek) so

as to preclude the occurrence of similar violations in the future. These actions include:

1. Denying the former superintendents unescorted access authorization and denoting

his entry in the Personnel Access Data System to indicate that there is additional

information.

2. Performing an internal fact-finding and accountability investigation and an apparent

cause evaluation, which resulted in the following corrective measures:

a. Revising the firearms maintenance, testing, and accountability procedure to

remove the requirement to replace parts biennially;

b. Completing the initial development of an electronic application that will track

weapons upon their removal from their assigned positions;

6

c. Holding face-to-face meetings between the Oyster Creek Security Manager and

site armorers to ensure understanding of procedural requirements, complete and

accurate recordkeeping, and accurate ammunition accounting, including logging

unused ammunition returned to the armory after range activities;

d. Conducting, over a two-month period, spot checks of security personnel logging

security weapons, ammunition, and equipment into and out of the armory and

performing ammunition counts.

3. Creating the position of Fleet Director of Security Operations and appointing an

experienced nuclear security manager to the position as a concurrent role.

4. Initiating development of a standardized set of fleet security procedures.

Therefore, the parties agree to the following terms and conditions:

1. Terms and Conditions to be taken by HDI:

A. Items to Assure Restoration of Compliance:

1. Within 60 days of the date of the C onfirmatory Order, HDI shall prepare a

report of the maintenance status of all in-service and contingency weapons

that are onsite at Oyster Creek as of the date of the C onfirmatory Order. The

report shall specify the dates on which each weapon was last test-fired,

cleaned, serviced, and inspected. Within 30 days of completing this action,

7 HDI shall inform the NRC that the action is complete by sending a letter to the

Region I Administrator and shall make the report available to the NRC for

review during an inspection.

2. Within 180 days of the date of the C onfirmatory Order, HDI shall complete a

root cause evaluation of the events related to the violations at Oyster Creek

described in this Confirmatory Order in accordance with HDIs corrective

action program. Within 30 days of completing this action, HDI sh all inform

the NRC that the action is complete by sending a letter to the Region I

Administrator and shall make the evaluation available to the NRC for review

during an inspection.

3. Within 180 days of the date of the C onfirmatory Order, HDI shall review its

process for performing and recording in-service and out-of-service weapons

maintenance. The review shall include a comparison of Oyster Creeks

process versus other nuclear sites, including at least one non-HDI nuclear

site. The evaluation shall identify best practices and consider any changes

needed at Oyster Creek and specify any identified corrective actions. Within

30 days of completing this action, HDI shall inform the NRC that the action is

complete by sending a letter to the Region I Administrator and shall make the

results of the evaluation available to the NRC for review during an inspection.

B. Items to Address Wrongdoing:

1. Within 60 days of the date of the C onfirmatory Order, HDI shall communicate

this issue to the security personnel at Oyster Creek and other HDI

8 decommissioning nuclear reactor sites. The communication (which may be

verbal or via written communication) will be conducted by the president of

HDI and shall specify that wr ongdoing and falsification of records are

unacceptable and shall also explain the specific actions staff must take when

unable to complete required activities. Within 30 days of completing this

action, HDI shall inform the NRC that the action is complete by sending a

letter to the Region I Administrator. The letter shall also describe the content

of the communication.

2. Within 180 days of the date of the Confirmatory Order, HDI will conduct

training to be given to Security personnel at each of HDI's nuclear sites. The

training will: (a) emphasize the importance of complete and accurate

information for all required records, correspondence, and communications

with the NRC and its staff; (b) emphasize individual accountability and clearly

express that willful or deliberate failures to comply with regulations, orders, or

license requirements could result in significant individual enforcement by the

NRC; and (c) reinforce that if any individual recognizes a non-compliance,

they will immediately report the observation of the non-compliance. Within 30

days of completing this action, HDI shall inform the NRC that the action is

complete by sending a letter to the Region I Administrator and shall make the

training materials available to the NRC for review during an inspection.

C. Items to Address Armorer Function Weaknesses:

1. Within 240 days of the date of the Confirmatory Order, HDI shall evaluate its

implementation of the a rmorer function at Oyster Creek. The evaluation shall

9 include review of the staffing and responsibilities of the position, the

methodology for tracking weapons maintenance status and activities, and

supervisory involvement in verifying completion of required activities. The

evaluation shall also include a comparison of HDI s weapons maintenance

processes versus other nuclear reactor sites, including at least one non-HDI

nuclear reactor site. The evaluation shall identify best practices and consider

any changes needed at Oyster Creek and specify any identified corrective

actions. Within 30 days of completing this action, HDI shall inform the NRC

that the action is complete by sending a letter to the Region I Administrator

and shall make the results of the evaluation available to the NRC for review

during an inspection.

2. Within 90 days of completing the evaluation described in Item C.1, HDI shall

communicate (which may be verbal or in writing) to HDI Security

management staff at Oyster Creek the results of the evaluation and any

completed or pending corrective actions. Within 30 days of completing this

action, HDI shall inform the NRC that the action is complete by sending a

letter to the Region I Administrator and shall make the content of the

communication available to the NRC for review during an inspection.

D. Items to Address Implementation of Security Program at Oyster Creek:

1. Within 365 days of the date of the Confirmatory Order, HDI shall administer

training to HDI and Holtec Security I nternational, LLC (HSI) Security staff at

Oyster Creek that focuses on roles and expectations and that reinforces

HDIs responsibility for assuring regulatory compliance. The training shall

10 also include any insights developed from the root cause evaluation described

in Item A.2. Within 30 days of completing this action, HDI shall inform the

NRC that the action is complete by sending a letter to the Region I

Administrator and shall make the training materials available to the NRC for

review during an inspection.

2. Within 365 days of the date of the Confirmatory Order, HDI shall evaluate the

Oyster Creek security program to include the programs organizational

effectiveness, the quality and effectiveness of site security procedures, the

security organizations staffing, training, and communication of standards,

expectations, management engagement and oversight, performance

management, and the results of the root cause evaluation. The evaluation

shall also include a review of the clarity for the security staff about lines of

responsibility and reporting, and the performance and quality of how

individual job performance results are evaluated, documented, and

communicated. The results of the evaluation shall be placed in the Oyster

Creek corrective action program. The evaluation team shall be comprised of

no more than 50% HDI or HSI employees and the remaining participants

shall be from an outside organization (such as a utility or industry group)

including a safety culture expert, external to HDI and HSI. Within 30 days of

completing this action, HDI shall inform the NRC that the action is complete

by sending a letter to the Region I Administrator and shall make the results of

the evaluation and any related corrective actions available to the NRC for

review during an inspection.

11 E. Items to Address Corporate Security Oversight

1. Within 90 days of the date of the C onfirmatory Order, HDI shall install a Fleet

Security Director position with sole responsibility for oversight of the security

operations at all HDI nuclear sites. The Site Security Leads shall report to

the Fleet Security Director and the Fleet Security Director shall report to the

HDI President. Within 30 days of completing this action, HDI sh all inform the

NRC that the action is complete by sending a letter to the Region I

Administrator. HDI shall maintain an individual in this position for a period of

5 years after the date of the Confirmatory Order or until fuel at all HDI nuclear

sites is in dry storage, whichever is sooner.

2. Within 365 days of the date of the C onfirmatory Order, HDI shall effect an

evaluation of HDIs implementation of the corporate security program. The

evaluation team shall be comprised of no more than 50% HDI or HSI

employees, and the remaining participants shall be from an outside

organization (such as a utility or an industry group). The evaluation shall

assess HSIs and HDIs corporate security staffing resources, direct and

indirect oversight, and performance management. The evaluation shall

review the fleet implementation of the security programs at each HDI site to

identify areas of strengths and weaknesses. Within 30 days of completing

this action, HDI shall inform the NRC that the action is complete by sending a

letter to the Region I Administrator and shall make the results of the

evaluation available to the NRC for review during an inspection.

12 F. Effectiveness Reviews

1. Within 90 days of completion of the evaluation described in D.2, HDI shall

complete the first of four quarterly reviews of the effectiveness of the Oyster

Creek security program and the corrective actions implemented in response

to this issue. Within 30 days of completing each review, HDI shall inform the

NRC of the completion of the review by sending a letter to the Region I

Administrator.

2. The effectiveness reviews discussed in Item F.1 shall be conducted by a

team that includes at least one individual from outside the HDI or HSI

organization. For a period of one year after completion of the fourth review,

the documented effectiveness reviews shall be made available to the NRC for

review during an inspection.

G. External Communication

A. By December 31, 2023, HDI shall discuss this issue, including the results of

all of the above-listed evaluations and resulting corrective actions, to the

following industry working groups: a ) the 2023 National Nuclear Security

Conference; and b) Region I Nuclear Security Association. The discussion

shall include reference to any identified organizational weaknesses that HDI

determined contributed to the issue. Within 30 days of completing each

discussion, HDI shall inform the NRC that the action is complete by sending a

letter to the Region I Administrator and shall make the presentation materials

13 available to the NRC for one year after the presentation for review during an

inspection.

2. Terms and Conditions to be taken by NRC:

A. The NRC agrees to issue a reduced civil penalty in the amount of $50,000.

B. The NRC agrees to not issue a separate Notice of Violation in addition to the

Confirmatory Order but, rather, to describe the violations in the body of the

Order instead.

C. The NRC agrees to include the following statement in the Confirmatory Order

and related communications (i.e., press release): As part of this agreement,

HDI has committed to a number of significant actions that are expected to

improve the security performance of the fleet. The NRC notes that, prior to

this ADR session, HDI initiated some measures to address the issues raised

by the apparent violation. The NRC will continue to monitor HDIs progress in

this area.

D. For the NRCs future civil penalty assessment purposes as discussed in the

NRC Enforcement Policy, the NRC agrees that the issuance of this

Confirmatory Order will not be considered as escalated enforcement.

On January 19, 2022, HDI consented to issuing this Confirmatory Order with the

commitments, as described in Section V below. HDI further agreed that this

Confirmatory Order is to be effective upon issuance, the agreement memorialized in this

Confirmatory Order settles the matter bet ween the parties, and that it has waived its right

to a hearing.

14 IV

HDI has committed to a number of significant actions that are expected to

improve the security performance of the fleet. The NRC notes that, prior to the ADR

session, HDI initiated some measures to address the issues raised by the apparent

violations. The NRC will continue to monitor HDIs progress in this area. I find that

HDIs actions completed, as described in Section III above, combined with the

commitments as set forth in Section V are acceptable and necessary, and conclude that,

with these commitments, the public health and safety are reasonably assured.

In view of the foregoing, I have determined that public health and safety require

that HDIs commitments be confirmed by this Confirmatory Order. Based on the above

and HDIs consent, this Confirmatory Order is effective upon issuance.

V

Accordingly, pursuant to Sections 81, 104b, 161b, 161i, 161o, 182 and 186 of the

Atomic Energy Act of 1954, as amended, and the Commission's regulations in 10 CFR

2.202, 10 CFR Part 50, 10 CFR Part 72, and 10 CFR Part 73, IT IS HEREBY

ORDERED, EFFECTIVE UPON ISSUANCE, THAT LICENSE NO. DPR-16 IS

MODIFIED AS FOLLOWS:

A. Items to Assure Restoration of Compliance:

1. Within 60 days of the date of the C onfirmatory Order, HDI shall prepare a report

of the maintenance status of all in-service and contingency weapons that are

15 onsite at Oyster Creek as of the date of the C onfirmatory Order. The report shall

specify the dates on which each weapon was last test-fired, cleaned, serviced,

and inspected. Within 30 days of completing this action, HDI sh all inform the

NRC that the action is complete by sending a letter to the Region I Administrator

and shall make the report available to the NRC for review during an inspection.

2. Within 180 days of the date of the C onfirmatory Order, HDI shall complete a root

cause evaluation of the events related to the violations at Oyster Creek described

in this Confirmatory Order in accordance with HDIs corrective action program.

Within 30 days of completing this action, HDI shall inform the NRC that the action

is complete by sending a letter to the Region I Administrator and shall make the

evaluation available to the NRC for review during an inspection.

3. Within 180 days of the date of the C onfirmatory Order, HDI shall review its

process for performing and recording in-service and out-of-service weapons

maintenance. The review shall include a comparison of Oyster Creeks process

versus other nuclear sites, including at least one non-HDI nuclear site. The

evaluation shall identify best practices and consider any changes needed at

Oyster Creek and specify any identified corrective actions. Within 30 days of

completing this action, HDI shall inform the NRC that the action is complete by

sending a letter to the Region I Administrator and shall make the results of the

evaluation available to the NRC for review during an inspection.

16 B. Items to Address Wrongdoing:

1. Within 60 days of the date of the C onfirmatory Order, HDI shall communicate this

issue to the security personnel at Oyster Creek and other HDI decommissioning

nuclear reactor sites. The communication (which may be verbal or via written

communication) will be conducted by the president of HDI and shall specify that

wrongdoing and falsification of records are unacceptable and shall also explain

the specific actions staff must take when unable to complete required activities.

Within 30 days of completing this action, HDI sh all inform the NRC that the action

is complete by sending a letter to the Region I Administrator. The letter shall also

describe the content of the communication.

2. Within 180 days of the date of the Confirmatory Order, HDI will conduct training

to be given to Security personnel at each of HDI's nuclear sites. The training will:

(a) emphasize the importance of complete and accurate information for all

required records, correspondence, and communications with the NRC and its

staff; (b) emphasize individual accountability and clearly express that willful or

deliberate failures to comply with regulations, orders, or license requirements

could result in significant individual enforcement by the NRC; and (c) reinforce

that if any individual recognizes a non-compliance, they will immediately report

the observation of the non-compliance. Within 30 days of completing this action,

HDI shall inform the NRC that the action is complete by sending a letter to the

Region I Administrator and shall make the training materials available to the NRC

for review during an inspection.

17 C. Items to Address Armorer Function Weaknesses:

1. Within 240 days of the date of the Confirmatory Order, HDI shall evaluate its

implementation of the a rmorer function at Oyster Creek. The evaluation shall

include review of the staffing and responsibilities of the position, the methodology

for tracking weapons maintenance status and activities, and supervisory

involvement in verifying completion of required activities. The evaluation shall

also include a comparison of HDI s weapons maintenance processes versus

other nuclear reactor sites, including at least one non-HDI nuclear reactor site.

The evaluation shall identify best practices and consider any changes needed at

Oyster Creek and specify any identified corrective actions. Within 30 days of

completing this action, HDI shall inform the NRC that the action is complete by

sending a letter to the Region I Administrator and shall make the results of the

evaluation available to the NRC for review during an inspection.

2. Within 90 days of completing the evaluation described in Item C.1, HDI shall

communicate (which may be verbal or in writing) to HDI Security management

staff at Oyster Creek the results of the evaluation and any completed or pending

corrective actions. Within 30 days of completing this action, HDI shall inform the

NRC that the action is complete by sending a letter to the Region I Administrator

and shall make the content of the communication available to the NRC for review

during an inspection.

18 D. Items to Address Implementation of Security Program at Oyster Creek:

1. Within 365 days of the date of the C onfirmatory Order, HDI shall administer

training to HDI and Holtec Security International, LLC (HSI) Security staff at

Oyster Creek that focuses on roles and expectations and that reinforces HDIs

responsibility for assuring regulatory compliance. The training shall also include

any insights developed from the root cause evaluation described in Item A.2.