AUDIT REPORT 

Audit of NRC’s Personnel Security 

Clearance Program for Employees 

OIG-10-A-09 February 23, 2010 

All publicly available OIG reports (including this report) are accessible through 

NRC’s Web site at: 

http:/www.nrc.gov/reading-rm/doc-collections/insp-gen/ 
UNITED STATES 

NUCLEAR REGULATORY COMMISSION 

WASHINGTON, D.C. 20555-0001 

OFFICE OF THE 

INSPECTOR GENERAL 

 February 23, 2010 

MEMORANDUM TO: R. William Borchardt 

 Executive Director for Operations 

FROM: Stephen D. Dingbaum /RA/ 

 Assistant Inspector General for Audits 

SUBJECT: AUDIT OF NRC’S PERSONNEL SECURITY CLEARANCE 

PROGRAM FOR EMPLOYEES (OIG-10-A-09) 

Attached is the Office of the Inspector General’s (OIG) report, Audit of NRC’s Personnel 

Security Clearance Program for Employees. 

The report presents the results of the subject audit. Agency comments provided during 

and subsequent to a January 28, 2010, exit conference have been incorporated, as 

appropriate, into this report. 

Please provide information on actions taken or planned on each of the 

recommendations within 30 days of the date of this memorandum. Actions taken or 

planned are subject to OIG followup as stated in Management Directive 6.1. 

We appreciate the cooperation extended to us by members of your staff during the 

audit. If you have any questions or comments about our report, please contact me at 

415-5915 or Beth Serepca, Team Leader, Security and Information Management Audit 

Team, at 415-5912. 

Attachment: As stated 

 
Electronic Distribution

Edwin M. Hackett, Executive Director, Advisory Committee on Reactor 

 Safeguards 

E. Roy Hawkens, Chief Administrative Judge, Atomic Safety and 

 Licensing Board Panel 

Stephen G. Burns, General Counsel 

Brooke D. Poole, Jr., Director, Office of Commission Appellate Adjudication 

James E. Dyer, Chief Financial Officer 

Margaret M. Doane, Director, Office of International Programs 

Rebecca L. Schmidt, Director, Office of Congressional Affairs 

Eliot B. Brenner, Director, Office of Public Affairs 

Annette Vietti-Cook, Secretary of the Commission 

R. William Borchardt, Executive Director for Operations 

Bruce S. Mallett, Deputy Executive Director for Reactor 

 and Preparedness Programs, OEDO 

Martin J. Virgilio, Deputy Executive Director for Materials, Waste, Research, 

 State, Tribal, and Compliance Programs, OEDO 

Darren B. Ash, Deputy Executive Director for Corporate Management 

 and Chief Information Officer, OEDO 

Nader L. Mamish, Assistant for Operations, OEDO 

Kathryn O. Greene, Director, Office of Administration 

Patrick D. Howard, Director, Computer Security Officer 

Roy P. Zimmerman, Director, Office of Enforcement 

Charles L. Miller, Director, Office of Federal and State Materials 

 and Environmental Management Programs 

Cheryl A. McCrary, Director, Office of Investigations 

Thomas M. Boyce, Director, Office of Information Services 

James F. McDermott, Director, Office of Human Resources 

Michael R. Johnson, Director, Office of New Reactors 

Michael F. Weber, Director, Office of Nuclear Material Safety and Safeguards 

Eric J. Leeds, Director, Office of Nuclear Reactor Regulation 

Brian W. Sheron, Director, Office of Nuclear Regulatory Research 

Corenthis B. Kelley, Director, Office of Small Business and Civil Rights 

James T. Wiggins, Director, Office of Nuclear Security and Incident Response 

Samuel J. Collins, Regional Administrator, Region I 

Luis A. Reyes, Regional Administrator, Region II 

Mark A. Satorius, Regional Administrator, Region III 

Elmo E. Collins, Jr., Regional Administrator, Region IV 
Audit of NRC’s Personnel Security Clearance Program for Employees 

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EXECUTIVE SUMMARY 

BACKGROUND

The Nuclear Regulatory Commission’s (NRC) personnel security 

clearance program strives to implement measures to ensure that agency 

staff can be trusted to work with and protect classified information and to 

prevent the hiring of employees who might be untrustworthy or unsuitable 

for Federal employment. At NRC, the Personnel Security Branch (PSB) 

administers the personnel security clearance program. PSB staff report to 

the Division of Facilities and Security (DFS), which is part of the Office of 

Administration (ADM).

The Atomic Energy Act of 1954, as amended, requires all NRC employees 

to have a security clearance, but allows employees to begin working for 

NRC prior to their clearance — provided the Commission determines that 

such employment is in the national interest and the employee does not 

have access to classified information. Today, a significant number of new 

NRC employees are permitted to begin work prior to receiving a security 

clearance, but only after PSB conducts a review of the individual’s 

background information as reported by the individual, credit history, and 

criminal history; evaluates the results; and determines there are no factors 

that may constitute a security risk to the agency. This approval is referred 

to as a pre-appointment investigation waiver or a 145b waiver. 

After NRC grants an initial approval to begin work (with no access to 

classified information), the agency requests a full background investigation 

from the Office of Personnel Management (OPM). Once the OPM 

background investigation is returned to NRC, PSB staff adjudicate the 

results by reviewing the investigation report. The adjudicative process is 

an examination of a sufficient period of a person's life to make a 

determination to grant or deny a security clearance. 

In 2005, as a result of a substantial increase in hiring, ADM shifted its 

resources toward completing its own pre-appointment investigation and 

processing of 145b waivers. This resource realignment was effected to 

support the agency’s higher priority to complete ongoing hiring initiatives 

in a timely manner. For the period FY 2005 through FY 2008, background 

investigations increased from 925 to 1,593, or approximately 72 percent. 

As a result of this shift in resources, a considerable backlog of cases 

requiring adjudication developed after receipt of OPM closed background 

investigations. DFS management stated that this backlog, consisting 

primarily of contractor and licensee clearance requests, was 1,121 cases 

in January 2009. Management also asserted that the backlog has been 

reduced in the last 12 months to 350 cases. 
Audit of NRC’s Personnel Security Clearance Program for Employees 

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PURPOSE

The purpose of this audit was to determine whether (1) NRC is in 

compliance with external and internal personnel security clearance 

requirements, and (2) NRC’s personnel security clearance program is 

efficiently managed. 

RESULTS IN BRIEF

Although it is NRC’s policy to ensure that personnel security 

determinations are made in accordance with external and internal 

requirements, NRC is not fully in compliance with established timeliness 

requirements for processing personnel security clearances. Furthermore, 

NRC’s personnel security clearance program lacks sufficient management 

controls and oversight to measure the program’s efficiency and assign 

accountability for the program’s performance. 

Timeliness Requirements Not Met 

The Intelligence Reform and Terrorism Prevention Act of 2004 provides 

timeliness requirements for processing Federal personnel security 

clearance investigations. NRC has not fully met the adjudication and 

reinvestigation timeliness requirements because DFS management has 

not implemented a procedure to routinely monitor and follow up on all 

case files to ensure cases are processed timely. Additionally, 

management lacks useful and reliable reports to track the status of 

clearance investigations through the various stages of the investigative 

process. Delays in completing initial investigations may hinder agency 

productivity, while delays in completing reinvestigations can lead to 

increased security risks. 

Agency Lacks Personnel Security Performance Measures

Federal control standards require the establishment and review of 

performance measures and indicators. At the start of this audit, NRC 

lacked performance measures to assess the efficiency of NRC’s 

personnel security clearance program. In response to a 2004 Office of the 

Inspector General (OIG) audit report recommendation, DFS added a 

timeliness performance measure to the FY 2005 ADM Operating Plan for 

the processing of personnel security investigations. In FY 2006, deeming 

the timeliness performance measure unattainable, management removed 

the measure from the plan. Without performance measures, the agency’s 

ability to assess personnel security clearance program efficiency and 

assign accountability for the program performance is limited. 

 
Audit of NRC’s Personnel Security Clearance Program for Employees 

iii

RECOMMENDATIONS 

 A draft report initially made five recommendations to improve the agency’s 

personnel security clearance program for employees. Prior to the 

issuance of this final report the agency implemented two of the 

recommended measures. Therefore, OIG removed the two 

recommendations that were already addressed, and this report makes 

three recommendations. A consolidated list of these recommendations 

appears in Section V of this report. 

AGENCY COMMENTS

Prior to and subsequent to a January 28, 2010, exit conference, agency 

senior executives provided suggested revisions to the discussion draft 

report for OIG’s consideration. This final report incorporates revisions 

made, where appropriate, as a result of the agency’s suggestions. 
Audit of NRC’s Personnel Security Clearance Program for Employees 

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Audit of NRC’s Personnel Security Clearance Program for Employees 

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ABBREVIATIONS AND ACRONYMS 

ADM Office of Administration 

 DFS Division of Facilities and Security 

 IRTPA The Intelligence Reform and Terrorism Prevention Act 

 of 2004 

 NRC Nuclear Regulatory Commission 

 OIG Office of the Inspector General 

 OPM Office of Personnel Management 

PSB Personnel Security Branch 
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Audit of NRC’s Personnel Security Clearance Program for Employees 

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TABLE OF CONTENTS

EXECUTIVE SUMMARY.............................................................................. i 

ABBREVIATIONS AND ACRONYMS ......................................................... v 

I. BACKGROUND ..................................................................................1 

II. PURPOSE...........................................................................................4 

III. FINDINGS...........................................................................................5 

A. TIMELINESS REQUIREMENTS NOT MET............................................5 

B. AGENCY LACKS PERSONNEL SECURITY 

 PERFORMANCE MEASURES ..........................................................11 

IV. AGENCY COMMENTS .....................................................................13 

V. CONSOLIDATED LIST OF RECOMMENDATIONS .........................14 

APPENDIX 

SCOPE AND METHODOLOGY................................................................15 
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Audit of NRC’s Personnel Security Clearance Program for Employees 

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I. BACKGROUND 

Federal personnel security programs are designed to protect 

U.S. national security interests by ensuring the reliability and 

trustworthiness of all Government employees. All Government 

employees must undergo a background investigation to work for 

the Federal Government. The type of investigation required 

depends on the type of work the individual will perform. When 

work requires access to classified information, a favorable 

adjudication of an appropriate investigation of the employee’s 

background, a demonstrated need-to-know, and a signed 

nondisclosure agreement are required. 

The Nuclear Regulatory Commission’s (NRC) personnel 

security clearance program strives to implement measures to 

ensure that agency staff can be trusted to work with and protect 

classified information and to prevent the hiring of employees 

who might be untrustworthy or unsuitable for Federal 

employment. At NRC, the Personnel Security Branch (PSB) 

administers the personnel security clearance program. PSB 

staff report to the Division of Facilities and Security (DFS), 

which is part of the Office of Administration (ADM). 

Atomic Energy Act and Section 145b 

The Atomic Energy Act of 1954, as amended, requires all NRC 

employees to have a security clearance, but allows employees 

to begin working for NRC prior to their clearance — provided the 

Commission determines that such employment is in the national 

interest and the employee does not have access to classified 

information. Today, a significant number of new NRC 

employees are permitted to begin work prior to receiving a 

security clearance, but only after PSB conducts a review of the 

individual’s background information as reported by the 

individual, credit history, and criminal history; evaluates the 

results; and determines there are no factors that may constitute 

a security risk to the agency. This approval is referred to as a 

pre-appointment investigation waiver or a 145b waiver.1

 

1

 The term “145b waiver” refers to section 145b of the Atomic Energy Act of 1954, as 

amended, which provides NRC the authority to grant a pre-appointment investigation waiver. 
Audit of NRC’s Personnel Security Clearance Program for Employees 

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NRC’s Personnel Security Clearance Program

After NRC grants an initial approval to begin work (with no 

access to classified information), the agency requests a full 

background investigation, appropriate for either an “L” (secret), 

“L(H)” (high public trust),2

 or “Q” (top secret) clearance, from the 

Office of Personnel Management (OPM).3

 Once the OPM 

background investigation is returned to NRC, PSB staff 

adjudicate the results by reviewing the investigation report. The 

adjudicative process is an examination of a sufficient period of a 

person's life to make a determination to grant or deny a security 

clearance. Adjudicative guidelines provide the PSB staff 

members with specific criteria to aid in the determination 

process. 

NRC maintains employee personnel security information, such 

as background investigations, credit checks, and fingerprint 

checks, in paper files. When the files are not in use, PSB stores 

them in a secure, alarmed, file room (see Figures 1 and 2, 

below). An automated data system, referred to as the 

Integrated Personnel Security System, is also used to 

electronically store personnel security information, such as type 

of clearance and date of last investigation. 

 Figure 1. File Room Entrance Secured Figure 2. PSB File Room

 

2

 The L(H) designation is used for employees (e.g., resident inspectors) who do not require a 

Q clearance because they do not work with Secret Restricted Data or Top Secret Restricted 

Data or Top Secret National Security Information. Individuals designated as L(H) are initially 

investigated with a Background Investigation, which is less extensive than the Single Scope 

Background Investigation required for a Q level clearance. These individuals are then 

reinvestigated at the L level, but more frequently than those with regular L clearances. 

3

 In lieu of an OPM investigation and report, NRC may accept an investigation from another 

Federal Government department or agency that conducts personnel security investigations 

(current within the most recent 5 years), provided that an equivalent investigation and access 

authorization has been granted to the individual by another Government agency on the basis 

of such an investigation and report. This acceptance of a pre-existing equivalent 

investigation is referred to as “reciprocity.” 
Audit of NRC’s Personnel Security Clearance Program for Employees 

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In 2005, as a result of a substantial increase in hiring, ADM 

shifted its resources toward completing its own pre-appointment 

investigation and processing of 145b waivers. This resource realignment was effected to support the agency’s higher priority to 

complete ongoing hiring initiatives in a timely manner. For the 

period FY 2005 through FY 2008, background investigations 

increased from 925 to 1,593, or approximately 72 percent. 

As a result of this shift in resources, a considerable backlog of 

cases requiring adjudication developed after receipt of OPM 

closed background investigations. DFS management stated 

that this backlog, consisting primarily of contractor and licensee 

clearance requests, was 1,121 cases in January 2009. 

Management also asserted that the backlog has been reduced 

in the last 12 months to 350 cases. 

 Types of Clearances Issued 

As of November 2009, 28 NRC employees were working under 

pre-appointment investigation waivers, 1,038 employees had Q 

clearances, 3,046 had L clearances, and 177 were designated 

as L(H) (see Figure 3). 

Figure 3

NRC Employees by Clearance Category 

as of November 2009

1,038

177

3,046

28

"Q" Top Secret "L(H)" High Public Trust "L" Secret Pre-Appointment

Source: OIG-generated based on data obtained from PSB 

Resources Allocated 

The PSB staff currently consists of 9 NRC employees (8 

Personnel Security Specialists and 1 Senior Personnel Security 

Specialist) who adjudicate cases and 7 contract staff who 

perform administrative duties. During this audit, the PSB 

Branch Chief was promoted to the position of Deputy Director, 
Audit of NRC’s Personnel Security Clearance Program for Employees 

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Division of Administrative Services. A Senior Personnel 

Security Specialist was serving as the Acting PSB Branch Chief 

while a search to fill the Branch Chief position was underway. 

On December 20, 2009, the Branch Chief position was filled. 

During FY 2009, NRC obligated $1.73 million for the Personnel 

Security Program and on background investigations of 

employees, contractors, and licensees.4

 

II. PURPOSE 

The audit objectives were to determine whether (1) NRC is in 

compliance with external and internal personnel security 

clearance requirements, and (2) NRC’s personnel security 

clearance program is efficiently managed. 

 

See the report appendix for a description of the audit scope and 

methodology. 

 

 

4

 PSB processes clearance investigations for NRC employees, contractors, and licensees. 

This audit focuses primarily on the clearance investigation process for NRC employees, 

although implementation of recommendations in this report should also improve contractor 

and licensee clearance processing. In some cases, NRC employee data cannot be 

separated from contractor and licensee data in OPM reporting obtained. Exceptions of this 

nature are noted, as necessary, in this report. 
Audit of NRC’s Personnel Security Clearance Program for Employees 

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III. FINDINGS 

Although it is NRC’s policy to ensure that personnel security 

determinations are made in accordance with external and 

internal requirements, NRC is not fully in compliance with 

established timeliness requirements for processing personnel 

security clearances. Furthermore, NRC’s personnel security 

clearance program lacks sufficient management controls and 

oversight to measure the program’s efficiency and assign 

accountability for the program’s performance. 

A. Timeliness Requirements Not Met 

The Intelligence Reform and Terrorism Prevention Act of 2004 

(IRTPA) provides timeliness requirements for processing 

Federal personnel security clearance investigations. NRC has 

not fully met the adjudication and reinvestigation timeliness 

requirements because DFS management has not implemented 

a procedure to routinely monitor and follow up on all case files 

to ensure cases are processed timely. Additionally, 

management lacks useful and reliable reports to track the status 

of clearance investigations through the various stages of the 

investigative process. Delays in completing initial investigations 

may hinder agency productivity, while delays in completing 

reinvestigations can lead to increased security risks. 

Timeliness Requirements

IRTPA timeliness requirements address both adjudication of 

clearance investigations and initiation of reinvestigations. 

 

 Adjudicative Timeliness 

The IRTPA requires that agencies make a determination on at 

least 80 percent of all applications for a personnel security 

clearance within an average of 120 days after the application for 

a security clearance is received by an authorized investigative 

agency (e.g., OPM).5

 This 120-day-average requirement allows 

90 days for completing the investigative phase of the clearance 

review and 30 days for completing the adjudicative phase of the 

 

5

 This “fastest 80 percent” requirement was put in place to provide a more realistic portrayal 

of agency performance. Delays for the 20 percent of cases that are not reported are typically 

due to the presence of serious issues that require further, extensive investigation or the 

absence of a required third party record. Inclusion of these cases would upwardly skew 

timeliness reporting. 
Audit of NRC’s Personnel Security Clearance Program for Employees 

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clearance review.6 This audit focused on NRC’s adjudicative 

timeliness, as investigative timeliness falls under OPM 

jurisdiction and is therefore outside of NRC’s control. 

 Reinvestigation Timeliness 

The IRTPA also requires that NRC initiate a reinvestigation 

every 5 years for Q and every 10 years for L clearances.7

Employees may also be reinvestigated if, at any time, there is 

reason to believe they no longer meet the standards for access 

to classified information. 

Investigation and Reinvestigation Timeliness Requirements 

Not Met 

NRC is not in compliance with respect to meeting established 

timeliness requirements for processing personnel security 

clearances. Specifically, NRC has not met IRTPA timeliness 

requirements for (1) adjudication of clearance investigations or 

(2) initiation of clearance reinvestigations. 

 Adjudicative Timeliness 

NRC was not in compliance with IRTPA adjudication timeliness 

requirements. Review of an OPM "Adjudication Timeliness 

Report" confirms that current IRTPA requirements have not 

been met for the first three quarters of FY 2009 (see Figure 4, 

next page).8

 

 

6

 In December 2009, IRTPA requirements changed to a 60-day-average period requirement. 

This new requirement allows 40 days to complete the investigative phase of the clearance 

review and 20 days to complete the adjudicative phase of the clearance review on at least 90 

percent of all applications for a personnel security clearance. 

7

 NRC’s L(H) designation is unique to NRC; therefore, it is not addressed by the IRTPA. 

However, NRC Management Directive 12.3, NRC Personnel Security Program, requires L(H) 

reinvestigations be conducted every 5 years. Management Directive 12.3 also reaffirms the 

reinvestigation timeliness requirements found in the IRTPA for Q and L clearances. 

8

 OPM’s report combines timeliness results for NRC employees, contractors, and licensees. 

These combined results are reflected in Figure 4. 
Audit of NRC’s Personnel Security Clearance Program for Employees 

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Figure 4

Adjudication Timeliness, Fastest 80 Percent 

October 1, 2008 through June 30, 2009 

N=978

0

100

200

300

400

0-30 31-60 61-90 91-120 121-150 151-180 181-365

Days to Complete

Source: OIG-generated based on data obtained from OPM 

OIG’s review also revealed that one employee was granted a 

145b waiver and has been working at NRC since April 2005 

without having the initial investigation adjudicated due to 

significant security issues. Furthermore, PSB staff did not take 

any adjudicative action for more than a year after the OPM 

investigation was completed on three employees’ investigative 

files. In one case, an OPM investigation of an NRC employee 

was completed in June of 2007 and the case was assigned to a 

Personnel Security Specialist. Because the results contained 

classified information from the Federal Bureau of Investigation 

with regard to issues of foreign influence, PSB staff secured the 

file in a safe. However, the file remained in the safe, untouched, 

until it was discovered in July of 2009 and reassigned to a 

different Personnel Security Specialist. As of November 2009, 

clearances have been granted for two of the four NRC 

examples identified above. 

 Reinvestigation Timeliness 

OIG identified 161 NRC employees whose reinvestigations were 

more than 1 year past due. In one case, a Branch Chief’s last 

investigation for an L clearance (required every 10 years) was 

completed more than 13 years ago, in May of 1996. Of the 161 

past due reinvestigations, 43 were for reinvestigations of NRC 

employees with Q clearances. 

62 percent of adjudications occurred 

outside of the 30-day IRTPA requirement 
Audit of NRC’s Personnel Security Clearance Program for Employees 

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Reinvestigations more than 1 year past due by clearance type 

are depicted in Figure 5. 

 Figure 5 

Reinvestigations > 1 Year Past Due by Clearance Type 

as of September 2009

43

32

86

Q - Top Secret

L(H) - High Public Trust

L - Secret

 Source: OIG-generated based on data obtained from PSB 

Lack of Management Oversight 

PSB is not meeting adjudication or reinvestigation timeliness 

requirements because management lacks useful and reliable 

reports to track the status of clearance investigations through 

the various stages of the investigative process. Additionally, 

management has not implemented procedures to routinely 

monitor and follow up on all case files to make sure cases are 

handled expeditiously. 

During the course of this audit, OIG conveyed this finding to 

PSB management who subsequently implemented an internal 

procedure to monitor cases as of December 2009. OIG verified 

this and removed the draft report recommendation to develop 

and implement a written procedure to routinely monitor and 

follow up on all personnel security case files. 

 

 Useful Routine Reporting Limited 

Currently, there is no complete report that shows when 

adjudications or reinvestigations are overdue. Additionally, 

limited useful personnel security reports further restricts PSB’s 

ability to track clearance investigations and reinvestigations. 

The Integrated Personnel Security System contains 11 

predefined adjudication reports, but only one, which lists all 

145b applicants in a pending or active status, can be used to 

help PSB assess whether it is completing adjudications in a 

timely manner. PSB is also unable to track an investigation 
Audit of NRC’s Personnel Security Clearance Program for Employees 

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from the time it is sent to OPM until it is returned from OPM and 

the clearance granted. 

Furthermore, for almost 2 years, a report intended to notify staff 

of upcoming employee reinvestigations has not been operating 

as intended. The report, titled “Notifications,” is supposed to list 

individuals requiring reinvestigations. However, the report is 

inaccurate because it includes employees who have already 

been reinvestigated, and individuals who no longer work for 

NRC. Lack of reliable data forces staff to go through the report 

manually and decide which individuals actually require a 

reinvestigation before they can initiate the process. The 

“Notifications” report has reportedly been upgraded during the 

course of this audit to allow the removal of persons having an 

investigation started or completed. DFS staff are in the process 

of verifying whether the upgraded report is now operating as 

intended. 

 No Routine Monitoring 

Interviews with management and staff confirmed that there is no 

routine monitoring or assessment of the status of individual 

personnel security clearance case files to ensure that cases 

returned from OPM are adjudicated in a timely manner. 

Instead, it is up to staff to track the status of the cases they are 

adjudicating on individually maintained spreadsheets. 

PSB staff acknowledged that investigations sometimes "fall 

through the cracks" and reported that they learn of these 

instances only when someone calls to check on the status of a 

clearance that has taken too long. 

Productivity Concerns and Security Risks 

Delays in completing initial investigations hinder agency 

productivity, while delays in completing reinvestigations can 

lead to increased security risks. 

 

 Agency Productivity Hindered 

Many jobs at NRC require that employees have a clearance to 

enable them access to classified information to perform their 

jobs. Access to classified information requires a clearance 

equal to or higher than the level of information to be accessed, 

and a need-to-know. Employees with a 145b waiver cannot 

access classified information while awaiting clearance approval, 

which hinders productivity by limiting the duties that the 
Audit of NRC’s Personnel Security Clearance Program for Employees 

10

employee can perform. This is exacerbated by an untimely 

adjudicative process. 

 Increased Security Risks 

NRC’s risk of a security breach occurring is increased because 

of delays in completing employee reinvestigations. The Joint 

Security Commission9

 reported that delaying reinvestigations 

poses risks to national security because the longer individuals 

hold clearances, the more likely they are to be working with 

more critical information and systems. Also, the longer a 

reinvestigation is delayed, the greater the risk that changes in 

an individual's behavior will go undetected. 

Recommendation:

OIG recommends that the Executive Director for Operations: 

1. Develop routine reports that provide management with the 

appropriate data needed to monitor and follow up on the 

status of all personnel security case files. 

 

 

9

 The Joint Security Commission was established in May 1993 by the Secretary of Defense 

and the Director of Central Intelligence to review security policies and procedures. It was 

convened twice and issued reports on its work in 1994 and 1999. 
Audit of NRC’s Personnel Security Clearance Program for Employees 

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B. Agency Lacks Personnel Security Performance Measures 

Federal control standards require the establishment and review 

of performance measures and indicators. At the start of this 

audit, NRC lacked performance measures to assess the 

efficiency of NRC’s personnel security clearance program. In 

response to a 2004 Office of the Inspector General (OIG) audit 

report recommendation, DFS added a timeliness performance 

measure to the FY 2005 ADM Operating Plan for the processing 

of personnel security investigations. In FY 2006, deeming the 

timeliness performance measure unattainable, management 

removed the measure from the plan. Without performance 

measures, the agency’s ability to assess personnel security 

clearance program efficiency and assign accountability for the 

program performance is limited. 

Requirement for Performance Measures

Performance measurement is achieved through the ongoing 

monitoring and reporting of program accomplishments, 

particularly progress towards pre-established goals. 

Performance assessments are used to analyze performance 

and seek improvements in efficiency and effectiveness. Federal 

standards require agencies to establish and monitor 

performance measures and indicators. 

Performance Measures Inadequate 

At the start of this audit, the ADM Operating Plan lacked 

performance measures to monitor the efficiency of the 

personnel security clearance program. A timeliness 

performance measure for the processing of personnel security 

investigations, once included in the ADM Operating Plan, was 

removed. Additionally, during this audit OIG reviewed the 

Performance Elements and Standards for the positions of 

Deputy Director, DFS and Branch Chief, PSB. Each of the 

documents reviewed contained a “Timeliness and Quality” 

standard that is dependent on meeting milestones and 

schedules provided in the ADM Operating Plan. OIG's review 

found that the ADM Operating Plan contained no security 

clearance processing timeliness measures. 

Lack of Management Oversight 

As a result of Audit Report OIG-04-A-11, Review of NRC's 

Personnel Security Program, ADM complied with an OIG 

recommendation and established a performance measure to 
Audit of NRC’s Personnel Security Clearance Program for Employees 

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assess the timeliness of NRC's reinvestigation program in its FY 

2005 Operating Plan. The timeliness performance measure 

was subsequently deemed unattainable by DFS management 

and therefore was removed from its FY 2006 Operating Plan. A 

manager no longer assigned to DFS stated that NRC hiring 

increases had placed an increased demand on DFS, which had 

been unable to increase adjudicative staff to appropriately 

handle this increase in workload.10

During the course of this audit, OIG conveyed this finding to 

DFS management and, subsequently, performance measures 

were added to the ADM Operating Plan for FY 2010. OIG 

verified this and removed the draft report recommendation to 

include a performance measure in the ADM Operating Plan to 

measure the timeliness of the security clearance process. 

Without Performance Measures, NRC Cannot Assess 

Efficiency 

The ability to assess personnel security clearance program 

efficiency and assign accountability for program performance is 

limited without performance measures. Performance measures 

are key indicators that can be used by management to assess 

the effectiveness of the program and determine where issues 

can be identified and resolved. Without performance measures, 

management cannot establish goals and measures to determine 

and improve program efficiency and effectiveness. 

Recommendations:

OIG recommends that the Executive Director for Operations: 

2. Include a performance measure in the Performance 

Elements and Standards for Branch Chief, Personnel 

Security Branch, to measure the timeliness of the 

security clearance process. 

3. Include a performance measure in the Performance 

Elements and Standards for Deputy Director, Division of 

Facilities and Security, to measure the adequacy and 

timeliness of work products from the Personnel Security 

Branch. 

 

10 Between FY 2006 and FY 2009, NRC hired 2,169 employees, resulting in a net increase of 

578 full-time equivalent staff. 
Audit of NRC’s Personnel Security Clearance Program for Employees 

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IV. AGENCY COMMENTS 

Prior to and subsequent to a January 28, 2010, exit conference, 

 agency senior executives provided suggested revisions to the 

 discussion draft report for OIG’s consideration. This final report 

 incorporates revisions made, where appropriate, as a result of 

 the agency’s suggestions. 
Audit of NRC’s Personnel Security Clearance Program for Employees 

14

V. CONSOLIDATED LIST OF RECOMMENDATIONS 

OIG recommends that the Executive Director for Operations: 

1. Develop routine reports that provide management with the 

appropriate data needed to monitor and follow up on the 

status of all personnel security case files. 

2. Include a performance measure in the Performance 

Elements and Standards for Branch Chief, Personnel 

Security Branch, to measure the timeliness of the security 

clearance process. 

3. Include a performance measure in the Performance 

Elements and Standards for Deputy Director, Division of 

Facilities and Security, to measure the adequacy and 

timeliness of work products from the Personnel Security 

Branch. 
Audit of NRC’s Personnel Security Clearance Program for Employees 

15

Appendix 

SCOPE AND METHODOLOGY 

The audit objectives were to determine whether (1) NRC is in 

compliance with external and internal personnel security 

clearance requirements, and (2) NRC’s personnel security 

clearance program is efficiently managed. 

 

To accomplish the audit objectives, OIG obtained and analyzed 

pertinent laws, regulations, and authoritative guidance; NRC 

policies and procedures; and prior relevant NRC OIG reports to 

identify Federal and agency requirements relevant to the 

personnel security clearance program. Guidance reviewed 

included the following: 

 The Intelligence Reform and Terrorism Prevention Act of 

2004. 

 Executive Order No. 12968, Access to Classified 

Information. 

 Revised Federal Investigative Standards. 

 Government Accountability Office Standards for Internal 

Control in the Federal Government. 

Additionally, OIG reviewed investigation case files, security 

system reports, human resource documents, and internal 

communications and conducted interviews with previous and 

current staff to: 

 Gain an understanding of NRC’s personnel security 

clearance program. 

 Determine current issues, problems, and known 

deficiencies. 

 Assess internal controls. 

Internal controls related to the audit objective were reviewed 

and analyzed. Throughout the audit, auditors were aware of the 

possibility or existence of fraud, waste, or misuse in the 

program. 

The work was conducted from June to October 2009 in 

accordance with generally accepted government auditing 

standards. Those standards require that we plan and perform 
Audit of NRC’s Personnel Security Clearance Program for Employees 

16

the audit to obtain sufficient, appropriate evidence to provide a 

reasonable basis for our findings and conclusions based on our 

audit objectives. We believe that the evidence obtained 

provides a reasonable basis for our findings and conclusions 

based on our audit objectives. 

The work was conducted by Beth Serepca, Team Leader; Terri 

Cooper, Audit Manager; Maxine Lorette, Senior Auditor; and 

Robert Woodward, Senior Auditor. We performed the audit 

work at NRC headquarters in Rockville, Maryland.