October 2, 2008 

MEMORANDUM TO: Chairman Klein 

 Commissioner Jaczko 

 Commissioner Lyons 

 Commissioner Svinicki 

FROM: R. W. Borchardt /RA Bruce Mallett for/ 

 Executive Director for Operations 

SUBJECT: SENIOR EXECUTIVE REVIEW PANEL – EVALUATION OF 

OFFICES OF INSPECTOR GENERAL AND INVESTIGATIONS 

REPORTS ON PEACH BOTTOM 

In the Staff Requirements Memorandum (SRM) - COMSECY-08-0009, “Report of the Senior 

Executive Review Panel-Peach Bottom Lessons Learned,” dated June 9, 2008, the Commission 

directed the Senior Executive Review Panel (SERP) to reassemble after the Offices of the 

Inspector General (OIG) and Investigations (OI) completed their reviews of security-related 

concerns at the Peach Bottom nuclear power plant. In the SRM, the Commission also directed 

the SERP to determine if there are additional lessons-learned and whether additional action is 

needed, and to provide the information to the Commission for its consideration. The OI and 

OIG completed their investigations on July 25 and August 22, 2008, respectively. The SERP 

reconvened on September 25, 2008, and examined the OIG event inquiry findings as well as 

the results of the Peach Bottom OI report. 

The OIG report, or event inquiry, identified findings in four areas. A copy of the findings from 

the report is enclosed for your reference. The SERP determined that the lessons-learned and 

actions previously identified in the March 4, 2008, SERP report addressed the four areas of 

findings in the OIG report. The SERP did identify some areas that merit further consideration 

and action to address: (i) the U.S. Nuclear Regulatory Commission (NRC) staff responses to the 

OIG’s questions as noted in the OIG report, and (ii) statements in the report indicating why 

certain NRC actions were taken and that NRC’s response was inconsistent with the guidance in 

Management Directive 8.8, “Management of Allegations” (MD 8.8). 

Below is a summary of the actions identified for each OIG report finding: 

 

• The SERP reviewed Finding No. 1 and Finding No. 4 and did not identify any new lessonslearned. The SERP determined that there was a clear basis for the difference in regulatory 

response to the March and September 2007 allegations that was consistent with the 

guidance in MD 8.8. 

CONTACT: Diana Diaz-Toro, OEDO 

 301-415-8744
The Commissioners -2- 

• Regarding Finding No. 2, the report states that the referral of the March 2007 allegation to 

the licensee was inconsistent with MD 8.8 because the allegations were against licensee 

management. The SERP determined that the March 2007 allegation was not against all

licensee management. The staff therefore referred the allegation to the licensee at a senior 

level of management with instructions that the evaluator be independent of the organization 

involving or affected by the alleged concern. The SERP determined that the intent of MD 

8.8 was to allow referrals to licensee management not related to the alleged concern, but 

this is not clearly stated. Therefore, the SERP recommended that the language in MD 8.8 

be clarified to reflect this intent. 

• Regarding Finding No. 2, the report states that the March 2007 allegation referral was 

inconsistent with MD 8.8 because three questions on page 33 of the MD 8.8 have answers 

that suggest otherwise. The SERP determined that the existing guidance only suggests 

these questions and responses be considered; and they were considered in the March 2007 

case. The SERP determined that the word, “consider”, is appropriate and no changes are 

needed in the MD 8.8. The SERP suggests that there are lessons-learned from this case, 

and these should be reviewed with staff during the fundamentals allegation training. 

In addition, the SERP determined that action C.2.a [page 6 and 7] of the March 4, 2008, 

SERP report, should be further clarified. Action C.2.a recommended expanding the 

inspection procedures for all program areas to include guidance for review of all open 

allegations or past allegations trends pertaining to the areas to be inspected during 

inspection preparation. The OIG report implies there may be a potential to not inspect 

allegations during inspections because they have been referred to licensees for follow-up. 

Based on this potential the SERP determined that the inspection procedures should be 

further clarified to state that the inspectors can review aspects of allegations even when the 

allegations have been referred to the licensee, as considered appropriate. 

• Regarding Finding No. 3, the report states that the staff’s attempts to verify the information 

the licensee provided were not sufficient. The SERP determined that additional 

consideration should be given to how and what actions can OI implement to confirm the 

accuracy of information that licensees provide, in cases where wrongdoing is suspected. As 

a result, the SERP agreed to further discuss the matter with OI to ensure that the previously 

identified SERP finding in Enclosure 2 (Additional Findings/Actions Identified by the SERP) 

to the March 4, 2008, SERP report, covers this matter. 

• While not a finding in the OIG event inquiry report, Page 7 recounts that a staff member said 

he may have been less sensitive to the March 2007 security concerns because past 

allegations had been unsubstantiated. The SERP considered this matter and determined 

that the NRC should ensure that this sensitivity is covered during the inspection and 

allegation basic training fundamentals. 

The OI report was an investigation into whether the licensee followed NRC requirements with 

regard to the inattentive security officers at Peach Bottom. The SERP determined that the 

lessons-learned regarding allegation follow-up and inspections to detect inattentive security 

officers as identified in the March 4, 2008, SERP report, encompass the lessons that can be 

gleaned from the OI report. Based on statements made by security officers during interviews, 

the SERP determined that consideration should be given to how and what actions can the NRC 
The Commissioners -3- 

implement, on a case-by-case basis, to enhance awareness of licensee’s employees regarding 

the purpose of NRC visits to the licensee without sharing allegation sensitive information. 

I agree with the SERP findings. It should be noted that, to date, we have taken several actions 

to address the lessons-learned identified in the March 4, 2008, SERP report. The findings from 

this most recent review will further enhance the quality and effectiveness of the NRC’s 

allegation and inspection process. The specific actions will be added to the actions identified in 

the March 4, 2008, SERP report and will be tasked to appropriate program offices for 

coordinated implementation. 

In accordance with the Chairman’s September 2, 2008, memorandum, the staff is also 

developing a response to the OIG regarding the event inquiry report’s findings. If you have any 

questions or comments, please let me know. 

Enclosure: 

Findings from the Office of Inspector General’s Event Inquiry 

cc: SECY 

OGC 

OCA 

OPA 

CFO 
The Commissioners -3- 

implement, on a case-by-case basis, to enhance awareness of licensee’s employees regarding 

the purpose of NRC visits to the licensee without sharing allegation sensitive information. 

I agree with the SERP findings. It should be noted that, to date, we have taken several actions 

to address the lessons-learned identified in the March 4, 2008, SERP report. The findings from 

this most recent review will further enhance the quality and effectiveness of the NRC’s 

allegation and inspection process. The specific actions will be added to the actions identified in 

the March 4, 2008, SERP report and will be tasked to appropriate program offices for 

coordinated implementation. 

In accordance with the Chairman’s September 2, 2008, memorandum, the staff is also 

developing a response to the OIG regarding the event inquiry report’s findings. If you have any 

questions or comments, please let me know. 

Enclosure: 

Findings from the Office of Inspector General’s Event Inquiry 

cc: SECY 

OGC 

OCA 

OPA 

CFO 

DISTRIBUTION: G20080590/EDATS: OEDO-2008-0737/200800268/EDATS: SECY-2008-0378 

EDO R/F 

MVirgilo/OEDO 

RZimmerman/NSIR 

CCarpenter/OE 

ELeeds/NRR 

CHaney/NMSS 

JDyer/OCFO 

TBloomer/OEDO 

DDiaz-Toro/OEDO 

SBozin/EDO 

ADAMS ACCESSION NO.: ML082740227 

Office TRPB/OEDO DEDR/OEDO EDO/OEDO 

Name DDiaz-Toro BMallett RBorchardt 

(BMallett for) 

Date 10/01/08 10/02/08 10/02/08 

 OFFICIAL RECORD COPY
FINDINGS 

1. OIG determined that Region I was inconsistent in its assessment of the safety 

significance of two allegations, made within 6 months of each other, conveying similar 

concerns about inattentive security officers at Peach Bottom. 

In late March 2007, the Region I NRC resident inspector assigned to Peach Bottom 

received a letter from a former Wackenhut security manager who alleged that security 

officers at Peach Bottom came to work exhausted, were inattentive on duty, and covered 

for each other so they could nap during shifts. On March 27, 2007, Region I staff 

received the letter and assigned an allegation number to the security concerns. On 

March 29, 2007, Region I responded to this allegation by convening an ARB meeting. 

During the meeting, the ARB determined that the allegation did not pose an immediate 

safety issue. The ARB’s decision was based on a review of previous, similar security 

related allegations that had not been substantiated. The ARB also decided to repanel 2 

weeks later to determine NRC’s next steps. During the second ARB, on April 11, 2007, 

ARB participants again determined that the March security concerns did not pose an 

immediate safety issue and decided to refer the concerns to Exelon, the license holder 

for Peach Bottom. The concerns were referred by Region I to Exelon by an April 30, 

2007, letter. 

On September 10, 2007, Region I received a second allegation about inattentive security 

officers at Peach Bottom. On that date, the region’s Public Affairs Officer received a 

telephone call from a WCBS television reporter who claimed to possess a videotape 

depicting inattentive security officers on duty at the plant. Based on this telephone call, 

Region I promptly convened an ARB on the same day, and the ARB decided that the 

allegation posed a potential significant safety issue. The ARB also decided that because 

the reporter did not provide any specifics, the NRC staff should contact the reporter the 

same day to obtain additional details. The Region I staff contacted the reporter who 

would not provide any additional details but reiterated that security officers were 

inattentive at Peach Bottom and that the reporter had a video which showed the Peach 

Bottom inattentive officers. A second ARB meeting was convened on September 10, 

2007, and the ARB was informed that the reporter would not provide further details of 

the Peach Bottom officers’ inattentiveness. Shortly thereafter, resident inspectors 

assigned to Peach Bottom began increased monitoring of security officer activities, 

including night shift inspections of security officers for inattentiveness. On September 

20, 2007, Region I staff reviewed the video and also convened an AIT. 

2. OIG determined that MD 8.8 encourages the NRC staff to refer “as many allegations as 

possible” to licensees and establishes criteria for doing so. However, in referring the 

Peach Bottom security concerns to Exelon, Region I staff did not follow MD 8.8’s 

direction that allegations against licensee management should not be referred. Two of 

the three concerns – officers feared retaliation from Exelon management for raising 

safety concerns and Exelon management was aware that officers were inattentive on 

duty but was not taking proper actions to address the inattentiveness – fall into this 

category. 

 Enclosure 
 

In addition to the above, the referral of the allegation by Region I to Exelon was not 

consistent with MD 8.8 guidance for referral in the following areas: 

• Has the alleger raised objections to releasing the allegation to the licensee? The 

former Wackenhut security manager requested anonymity regarding the March 

2007 letter and that NRC not inform Exelon of the letter’s existence. 

• Are resources available within the region or program office to conduct an 

investigation or inspection? On the date of the referral letter to Exelon, April 30, 

2007, Region I began a baseline security inspection that continued through May 

4, 2007. However, this inspection did not include the concerns in the March 2007 

letter. 

• What is the licensee’s past performance in dealing with allegations, including the 

likelihood that the licensee will effectively investigate, document, and resolve the 

allegation? The March 2007 letter stated the licensee was aware of inattentive 

officers at Peach Bottom but past efforts to address the inattentiveness had 

failed. 

3. OIG determined that other than making a telephone call to clarify the frequency of 

random communication checks and the number of officers involved in such checks, 

Region I did not probe or attempt to verify the information provided by Exelon in its May 

30, 2007, assessment report. 

• Region I staff did not question how random observations of BRE towers were 

conducted or documented even though the staff believed that random 

observations of the BRE towers were generally not possible because of the BRE 

tower configuration. Region I staff did not question this information even though 

they believed that supervisory post checks, the licensee’s other means of 

observing officers on post, would have limited success for catching inattentive 

security officers given that officers would always have advance notice and could 

prepare themselves accordingly. 

• Region I staff did not inquire into the licensee’s sampling of security officers and 

managers interviewed in an effort to determine their knowledge of inattentive 

security officers on duty. None of the security officers from the team that included 

the inattentive officers on the video were interviewed and no Wackenhut security 

managers were interviewed. 

• Region I staff did not question the viability or enforceability of Exelon’s program 

requirement for security officers to get up, walk around, and be active for 2-3 

minutes approximately every 15 minutes. 

4. OIG also determined that, in conjunction with referring the March 2007 concerns to 

Exelon for evaluation, Region I could have taken the following steps: 

• Contacted the former Wackenhut security manager to obtain additional 

information because the Region I staff believed the alleger’s letter lacked 

specificity. 
 

• Provided more detailed information to Exelon pertaining to the March 2007 

security concerns. Specifically, in its April 30, 2007, letter to Exelon, Region I 

could have informed Exelon that security officers were coordinating with each

other or waking each other up to respond to radio checks. They also could have 

conveyed the alleger’s suggestion to monitor the plant personnel staging areas. 

• Provided the March 2007 concerns to the NRC resident inspectors assigned to 

Peach Bottom for increased monitoring of security officer activities. 

• Tasked the Region I security inspectors to look into the matter during a baseline 

security inspection conducted at Peach Bottom from April 30 to May 4, 2007.