Audit of NRC’s

Oversight of 10 CFR 50.59, 

“Changes, tests and 

experiments.”

OIG-16-A-19

August 24, 2016

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 August 24, 2016

MEMORANDUM TO: Victor M. McCree

Executive Director for Operations

FROM: Steven E. Zane /RA/

Acting Assistant Inspector General for Audits

SUBJECT: AUDIT OF NRC’S OVERSIGHT OF 10 CFR 50.59,

“CHANGES, TESTS AND EXPERIMENTS” (OIG-16-A-19)

Attached is the Office of the Inspector General’s (OIG) audit report titled Audit of NRC’s

Oversight of 10 CFR 50.59, “Changes, tests and experiments.”

The report presents the results of the subject audit. Following the August 9, 2016, exit 

conference, agency staff indicated that they had no formal comments for inclusion in 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 

(301) 415-5915 or Paul Rades, Team Leader, at (301) 415-6228.

Attachment: As stated
Office of the Inspector General

U.S. Nuclear Regulatory Commission

Defense Nuclear Facilities Safety Board

Results in Brief

Audit of NRC’s Oversight of 10 CFR 50.59, “Changes, 

tests and experiments.”

What We Found

Federal internal control guidance recommends that agencies 

establish communication internal controls, and NRC’s own guiding 

principles call for clear regulatory positions. Federal internal 

control guidance calls for agencies to develop training that meets 

organizational goals and needs in order to ensure they have the 

required knowledge, skills, and abilities to achieve organizational 

goals.

NRC’s processes for 10 CFR 50.59 oversight could be strengthened 

by coordinating communication of 10 CFR 50.59 guidance and 

process-related information. NRC staff having responsibilities for 

oversight of 10 CFR 50.59 implementation, including inspectors, 

and headquarters and regional staff do not always coordinate 

communication of 10 CFR 50.59 process-related information, 

including reports and requirements. Additionally, NRC’s oversight 

of the 10 CFR 50.59 process could be strengthened by enhancing 

the agency’s post-qualification 10 CFR 50.59 training to include 

recurring formal training. 

These program weaknesses have occurred because NRC does not 

employ a well-structured approach for 10 CFR 50.59 process 

management and NRC’s 10 CFR 50.59 training needs were based 

on the agency’s immediate focus on addressing a San Onofre 

Nuclear Generating Station (SONGS) lessons learned training 

recommendation.

What We Recommend

This report makes recommendations to strengthen processes for 

NRC’s oversight of 10 CFR 50.59 implementation. Agency 

management stated their agreement with the findings and 

recommendations in this report.

Why We Did This Review

The U.S. Nuclear Regulatory 

Commission (NRC) oversees 

nuclear power plant licensees’ 

compliance with requirements 

stipulated in Title 10, Energy, 

Code of Federal Regulations, 

Section 50.59, “Changes, tests 

and experiments” (10 CFR 

50.59). 10 CFR 50.59 establishes 

the conditions under which 

licensees may make changes to 

their facilities or procedures, and 

conduct tests or experiments, 

without prior NRC approval for a 

license amendment. When 

implementing the provisions of 

10 CFR 50.59, licensees use the 

10 CFR 50.59 process, which 

involves applicability review, 

screening, evaluation, and 

documentation and reporting. 

In 2015, NRC staff estimated the 

number of licensee 10 CFR 50.59 

implementation actions. For 

each operating reactor unit, 

licensees conduct approximately 

475 screenings annually, from 

which result about 5 evaluations. 

This amounts to a combined total 

of about 49,000 screenings and 

evaluations per year.

The audit objective was to assess 

the consistency and effectiveness 

of NRC’s oversight of 10 CFR 

50.59 implementation.

OIG-16-A-19

August 24, 2016
Audit of NRC’s Oversight of 10 CFR 50.59, “Changes, tests and experiments.”

ABBREVIATIONS AND ACRONYMS .......................................................... i

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

II. OBJECTIVE......................................................................................6

III. FINDINGS.........................................................................................6

A. NRC Oversight of 10 CFR 50.59 Process Could Be 

Strengthened with More Coordinated Communications ........6

B. The 10 CFR 50.59 Training Process Could Be Improved ...11

IV. CONSOLIDATED LIST OF RECOMMENDATIONS.......................14

V. AGENCY COMMENTS...................................................................15

APPENDIXES 

A. OBJECTIVE, SCOPE, AND METHODOLOGY...............................16

B. 10 CFR 50.59 CHANGES, TESTS AND EXPERIMENTS. .............18

TO REPORT FRAUD, WASTE, OR ABUSE.............................................21

COMMENTS AND SUGGESTIONS..........................................................21

 TABLE OF CONTENTS
Audit of NRC’s Oversight of 10 CFR 50.59, “Changes, tests and experiments.”

i

CFR Code of Federal Regulations

NEI Nuclear Energy Institute

NRC U.S. Nuclear Regulatory Commission

NRR Office of Nuclear Reactor Regulation

OIG Office of the Inspector General 

SONGS San Onofre Nuclear Generating Station

 ABBREVIATIONS AND ACRONYMS
Audit of NRC’s Oversight of 10 CFR 50.59, “Changes, tests and experiments.”

1

The U.S. Nuclear Regulatory Commission (NRC) oversees nuclear power 

plant licensees’ compliance with requirements stipulated in Title 10, 

Energy, Code of Federal Regulations, Section 50.59, “Changes, tests and 

experiments” (10 CFR 50.59). 10 CFR 50.59 establishes the conditions 

under which licensees may make changes to their facilities or procedures, 

and conduct tests or experiments, without prior NRC approval for a license

amendment. 

10 CFR 50.59 Process

Figure 1. Source: OIG-generated from documentation of 10 CFR 50.59 processes

When implementing the provisions of 10 CFR 50.59, licensees use the 10 

CFR 50.59 process, which involves applicability review, screening, 

evaluation, and documentation and reporting as follows:

Applicability Review. Licensee personnel ascertain whether the proposed 

change requires a change to their facility’s technical specifications. They 

also determine whether the proposed change is controlled by another 

regulation or process.

Screening. Licensee personnel assess whether the proposed change 

adversely affects the design function of plant systems, structures, and 

 I. BACKGROUND
Audit of NRC’s Oversight of 10 CFR 50.59, “Changes, tests and experiments.”

2

components. If the proposed change “screens out” and does not require 

further evaluation, licensee personnel must support and document their 

decision to a degree commensurate with the safety significance of the 

proposed change. 

Evaluation. Licensee personnel conduct a written evaluation that must 

address the effects of the proposed change against 10 CFR 50.59 

evaluation criteria. These 10 CFR 50.59 evaluation criteria are used to 

evaluate the effects of the change on accidents and malfunctions 

previously evaluated in the facility’s updated final safety analysis report.

Documentation and Reporting. Licensee personnel maintain records of 

changes in their facility, including the bases for determining that changes 

in procedures, and of tests and experiments did not require license 

amendments. They must report summaries of these activities to NRC on 

a biennial basis. 

In 2015, NRC staff estimated the number of licensee 10 CFR 50.59 

implementation actions. For each operating reactor unit, licensees

conduct approximately 475 screenings annually, from which about 5 

evaluations result. This amounts to a combined total of about 49,000 

screenings and evaluations per year. NRC staff further estimated that 

licensees submit about 1 license amendment per site every 10 years,

based on 10 CFR 50.59 criteria alone.

Appendix B of this report contains the full text of 10 CFR 50.59 which 

includes evaluation criteria at (c)(2)(i-viii), documentation of records 

requirements at (d)(1) and biennial reporting requirements at (d)(2).

10 CFR 50.59 Process Scenario

The following scenario of actions a licensee took to mitigate a flood hazard

and NRC’s related inspection illustrates implementation and NRC’s 

oversight of the 10 CFR 50.59 process. 

• First, licensee personnel proposed a facility change to mitigate a 

flood hazard.

• Next, licensee personnel determined that 10 CFR 50.59 

requirements could apply to installation of a flood outlet device 

because this activity would affect functionality of reactor safe shut 

down equipment as described in the plant’s final safety analysis 

report. 

• Then, the licensee personnel developed a modification package

and screened it. 
Audit of NRC’s Oversight of 10 CFR 50.59, “Changes, tests and experiments.”

3

• Finally, licensee personnel concluded from the screening results 

that the flood outlet device modification did not require the more indepth 10 CFR 50.59 evaluation.

NRC inspectors subsequently reviewed the licensee’s 10 CFR 50.59 

screening records for the flood outlet device modification. They concluded 

that licensee personnel had correctly screened their modification package, 

and thus, did not need to perform a 10 CFR 50.59 evaluation.

NRC 10 CFR 50.59 Oversight Roles and Responsibilities 

Multiple NRC organizations share responsibility for oversight of 10 CFR 

50.59 implementation. Primarily, the Office of Nuclear Reactor Regulation 

(NRR) establishes policy and procedures associated with accomplishing 

key components of NRC’s nuclear reactor safety mission with respect to 

operating commercial power reactors. NRR divisions with 10 CFR 50.59 

process roles and responsibilities include:

• Division of Policy and Rulemaking, Generic Communications 

Branch, is the NRC 10 CFR 50.59 process owner. Branch staff 

provide 10 CFR 50.59 process management support to other 

headquarters and regional staff. Such support includes oversight of 

10 CFR 50.59 training activities and providing direct assistance to 

staff in interpreting aspects of 10 CFR 50.59 regulations and 

guidance.

• Division of Inspection and Regional Support staff perform activities 

associated with inspecting and assessing licensee performance; 

evaluating plant events and communicating lessons learned to 

cognizant groups; and administering enforcement and allegations 

activities.

• Division of Operating Reactor Licensing staff manage the review 

and processing of nuclear power plant license amendments, and 

serve as headquarters’ central point-of-contact with licensees, the 

regions, and other stakeholders in matters pertaining to assigned 

facilities. The Division of Operating Reactor Licensing staff are also 

currently responsible for receiving and processing licensees’ 

biennial report summaries of 10 CFR 50.59 evaluations. As a 

result of NRC’s re-baselining initiative, Project AIM, NRR staff will 

no longer review licensees’ biennial report summaries effective 

October 2016. 

NRC’s oversight of 10 CFR 50.59 implementation includes inspection of 

licensees’ processes. Staff based at NRC’s regional offices conduct 

inspections at nuclear power plants during which they assess 
Audit of NRC’s Oversight of 10 CFR 50.59, “Changes, tests and experiments.”

4

representative samples of evaluations, screenings, and/or applicability 

reviews, and permanent plant modifications.1 Additionally, NRC resident 

inspectors based at nuclear power plants conduct annual inspections of 

temporary and/or permanent facility modifications.2

NRC’s Office of Enforcement is responsible for the development and 

oversight of the policies and procedures used to disposition and enforce 

violations of 10 CFR 50.59 provisions. Colloquially referred to as the “dual 

path,” inspectors must disposition 10 CFR 50.59 violations according to 

the Reactor Oversight Process path (procedures are established under 

NRR) or the traditional enforcement path (procedures are established 

under the Office of Enforcement). Traditional enforcement applies when 

the violation impedes the regulatory process and is dispositioned as a 

non-minor issue. Examples of non-minor issues include:

• Failure to provide complete and accurate information.

• Failure to receive prior NRC approval for changes in licensed 

activities.

• Failure to notify the NRC of changes in licensed activities. 

• Failure to perform 10 CFR 50.59 analyses. 

SONGS Lessons Learned

NRC published the SONGS lessons learned report partly in response to 

an OIG Investigations event inquiry.

3 Among other topics, the event 

inquiry examined NRC’s oversight of the licensee’s application of the 10 

CFR 50.59 process for the replacement of steam generators in SONGS 

Units 2 and 3. As a result, NRC’s lessons learned report committed to 

process improvement actions to include additional training and 

enhancements to internal NRC procedures related to 10 CFR 50.59. In 

addition, on April 13, 2016, NRC issued a Regulatory Issue Summary that 

reviewed the issues identified with the SONGS steam generator 

replacements and reiterated the staff position on 10 CFR 50.59. Finally, in 

April 2016, NRC instituted a 10 CFR 50.59 online training module.4

 1 Inspection Procedure 71111.17T, Evaluations of Changes, Tests, and Experiments and Permanent 

Plant Modifications.

2 Inspection Procedure 71111.18, Plant Modifications.

3 The OIG Investigation event inquiry is titled, NRC Oversight of Licensee’s Use of 10 CFR 50.59 Process 

To Replace SONGS’ Steam Generators, Case No. 13-006, October 2, 2014.

4 10 CFR 50.59 Refresher Training (Web-based), Course ID 254144, NRC iLearn online training system 

April 14, 2016.
Audit of NRC’s Oversight of 10 CFR 50.59, “Changes, tests and experiments.”

5

Revision of Digital Instrumentation and Controls Guidance

NRC has continued work relating to 10 CFR 50.59, including involvement 

in the development of the revised draft guidance for digital instrumentation 

and controls, which will be used to address obsolete analog systems in 

facilities. At the time of this audit, the agency is in the process of 

reviewing updated industry digital instrumentation and controls guidance,

which will be added to existing 10 CFR 50.59 guidance.
Audit of NRC’s Oversight of 10 CFR 50.59, “Changes, tests and experiments.”

6

The audit objective was to assess the consistency and effectiveness of 

NRC’s oversight of 10 CFR 50.59 implementation. To meet this objective, 

OIG auditors focused on the agency’s processes for oversight of facility 

licensees’ 10 CFR 50.59 implementation. Appendix A contains 

information on the audit scope and methodology.

NRC could better assure the consistency and effectiveness of its oversight 

of 10 CFR 50.59 implementation by using a more structured approach for 

coordinating communication of 10 CFR 50.59 process information and 

improving the 10 CFR 50.59 training process.

A. NRC Oversight of 10 CFR 50.59 Process Could Be 

Strengthened with More Coordinated Communications

Federal internal control guidance recommends that agencies establish 

communication internal controls, and NRC’s own guiding principles call for 

clear regulatory positions. However, NRC’s processes for 10 CFR 50.59 

oversight could be strengthened by coordinating communication of 10 

CFR 50.59 guidance and process-related information. Communication 

weaknesses exist because NRC has not employed a well-structured 

approach for 50.59 process management. As a result, NRC’s ability to 

achieve consistent and effective regulatory oversight is potentially 

diminished.

 II. OBJECTIVE

 III. FINDINGS
Audit of NRC’s Oversight of 10 CFR 50.59, “Changes, tests and experiments.”

7

Coordinated Communication for Process Clarity 

Federal standards require NRC to establish communication internal 

controls, and agency’s Principles of Good Regulation include process 

clarity. The Government Accountability Office’s Standards for Internal 

Control in the Federal Government requires agency management to 

communicate the necessary quality information to achieve the entity’s 

objectives and to define policies through day-to-day procedures. 

Furthermore, clarity is one of the principles that guides how NRC carries 

out its regulatory activities, as stipulated in NRC’s Principles of Good

Regulation. Specifically, this principle calls for regulatory positions that can 

be readily understood and easily applied. 

Communication of Process–Related Information is Not Well 

Coordinated 

NRC staff having responsibilities for oversight of 10 CFR 50.59 

implementation, inspectors, and headquarters and regional staff do not 

always coordinate communication of 10 CFR 50.59 process-related 

information, such as guidance, reports and requirements.

According to several headquarters and regional staff, 10 CFR 50.59 

inspection and enforcement guidance could be better communicated for 

consistent understanding and clarity regarding use of the dual path 

Reactor Oversight Process and traditional enforcement to disposition 10 

CFR 50.59 inspection findings. Staff indicated that guidance regarding the

threshold for determining whether 10 CFR 50.59 findings would be 

dispositioned as more than minor, as well as determining the severity of 

potential 10 CFR 50.59 findings has not been clearly communicated. 

Agency actions to clarify dual path guidance are underway. This effort is 

being managed by NRR, Division of Inspection and Regional Support and 

What Is Required

What We Found
Audit of NRC’s Oversight of 10 CFR 50.59, “Changes, tests and experiments.”

8

involves input from NRC’s regional offices and Office of Enforcement. The 

10 CFR 50.59 process owners are not included in the clarification process; 

thus remain unaware of staff difficulties regarding the dual path use of 

Reactor Oversight Process and traditional enforcement in dispositioning

10 CFR 50.59 inspection findings.

NRC staff indicated that the guidance, Nuclear Energy Institute (NEI) 96-

07 Guidelines for 10 CFR 50.59 Implementation, Revision 1 (NEI 96-07, 

Revision 1), endorsed by NRC, is challenging to use. NRC staff indicated 

that NEI 96-07, Revision 1 is challenging for less experienced inspectors. 

This is because it lacks sufficient examples of what constitutes a violation 

of the 10 CFR 50.59 process. For example, the guidance contains 

convoluted language, and does not clearly define a more than minimal 

increase in the likelihood of accidents or malfunctions previously 

evaluated as per 10 CFR 50.59 evaluation criteria at (c)(2)(i-viii) in the 

regulation. (See Appendix B of this report). Additionally, an inspector with 

over 10 years of inspection experience had a difficult time understanding 

the 10 CFR 50.59 process with the guidance provided and resorted to

extensive research on the origins of the 10 CFR 50.59 process, including 

going back to original rulemaking documents to further understand what 

defines a more than minimal increase in the 10 CFR 50.59 process. 

Although extensive research on the origins of 10 CFR 50.59 may be 

helpful for clarification, less experienced inspectors may not know to use 

legal background documents for guidance. 

While inspectors stated that more clarification is needed, the process 

owner indicated awareness only of the digital instrumentation and controls

clarifications and asserted that NEI 96-07, Revision 1 was the best, most 

well written guidance on 10 CFR 50.59 in existence. Additionally, agency 

managers stated NEI 96-07, Revision 1 can be challenging for new 

inspectors to use because 10 CFR 50.59 is a very complex and nuanced 

area of expertise. 

Additionally, a report containing 10 CFR 50.59 process related information 

has not been communicated to staff. Office of Nuclear Reactor 

Regulation, Division of Inspection and Regional Support, Operating 

Experience Branch conducted a 10 CFR 50.59 process study that 

reportedly concluded in a draft document, in part, the lack of effective 

training for 10 CFR 50.59 inspectors. However, to date, the Operating 

Experience Branch’s 10 CFR 50.59 process study has not been published 
Audit of NRC’s Oversight of 10 CFR 50.59, “Changes, tests and experiments.”

9

or disseminated to Division of Policy and Rulemaking, Generic 

Communications Branch staff—the NRC 10 CFR 50.59 process owner.

Region I staff also completed a 10 CFR 50.59 self-assessment in 

September 2015 that recommended improvements to existing 

documentation and guidance, as well as for additional training. However, 

to date, Region I has communicated the results of the self-assessment to 

regional staff and to enforcement staff, but not to Generic 

Communications Branch staff. 

The last example of communication of 10 CFR 50.59 process-related 

information that could have been better communicated is the 10 CFR 

50.59 staff requirement for reviews of biennial reports which was not 

communicated to staff. The Commission approved the staff 

recommendation that NRR’s Division of Operating Reactor Licensing 

discontinue reviews of biennial reports that are submitted by licensees in 

accordance with 10 CFR 50.59. Per the regulation, licensees are still 

required to submit these reports to NRC. Headquarters staff indicated that 

the responsibility for reviewing the biennial reports would be taken over by 

regional staff, but regional staff had not heard anything official about the 

regions taking over this review. NRR management has stated that the 

agency will no longer be reviewing the biennial reports. According to NRR 

management, inspections will provide adequate oversight of licensee use 

of 10 CFR 50.59. 

NRC Approach for 10 CFR 50.59 Process Management is Not 

Well-Structured

NRC does not employ a well-structured approach for 10 CFR 50.59 

process management. The 10 CFR 50.59 process owner is not 

consistently addressing program concerns because questions must flow 

up through the regional and headquarters staff before reaching the 

Generic Communications Branch. This has led to instances of the 

process owners not being specifically aware of staff’s concerns raised 

about clarity of guidance. Additionally, staff take different approaches to 

leveraging 10 CFR 50.59 subject matter expertise across the agency. 

Why This Occurred
Audit of NRC’s Oversight of 10 CFR 50.59, “Changes, tests and experiments.”

10

While some staff communicate directly with process owners regarding 

oversight questions, staff sometimes try to resolve their questions on a 

peer-to-peer basis without involving process owners. The latter approach 

can expedite information sharing across organizational lines, but can also 

distance process owners from working-level observations, concerns, and 

questions that could help enhance 10 CFR 50.59 oversight.

Opportunity to Improve Ability to Provide Consistent and Effective 

Regulatory Oversight

Adoption of a more structured approach for managing NRC’s 10 CFR 

50.59 oversight processes could enhance NRC’s regulatory consistency 

and effectiveness. This is particularly important given the multiple NRC 

headquarters and regional organizations that play different, yet 

complimentary, roles in the agency’s oversight of licensees’ compliance 

with 10 CFR 50.59. Additionally, NRC would be better positioned to

provide nuclear power plant licensees throughout its four regions with 

consistent and predictable regulatory positions on 10 CFR 50.59 

compliance and enforcement matters.

Recommendation

OIG recommends that the Executive Director for Operations

1. Implement a structured approach for 10 CFR 50.59 process 

management that includes guidance clarification and coordination 

of program communications.

Why This Is Important
Audit of NRC’s Oversight of 10 CFR 50.59, “Changes, tests and experiments.”

11

B. The 10 CFR 50.59 Training Process Could Be Improved

NRC’s oversight of the 10 CFR 50.59 process could be strengthened by 

enhancing the agency’s post-qualification 10 CFR 50.59 training to include 

recurring formal training. Federal and agency guidance requires training 

to meet organizational goals and needs. NRC has not used established 

guidance to comprehensively evaluate 10 CFR 50.59 training needs. As a 

result, NRC could enhance knowledge management, improve training 

resource allocation, and tailor training needs to address key oversight 

issues and emerging industry trends.

Recurring Formal Training 

Federal internal control guidance calls for agencies to develop training that 

meets organizational goals and needs. Specifically, Government 

Accountability Office Standards for Internal Control in the Federal 

Government recommends that agencies train their personnel to ensure 

they have the required knowledge, skills, and abilities to achieve 

organizational goals. Government Accountability Office guidance5 also 

stipulates agencies should tailor training based on the needs of specific 

job roles. Accordingly, NRC’s training on the 10 CFR 50.59 process

should be formalized and recurring, such that it reflects the current, actual 

10 CFR 50.59 process needs.

NRC’s Post-Qualifications 10 CFR 50.59 Training Could Be Enhanced

NRC’s post-qualification 10 CFR 50.59 training could be enhanced with 

recurring formal training on the 10 CFR 50.59 process after inspector 

qualifications are completed. Many reactor inspectors have noted the 

absence of recurring formal 10 CFR 50.59 training. Reactor inspectors 

with over 10 years of inspection experience indicated that they have never 

 5 GAO-04-546G, HUMAN CAPITAL: A Guide for Assessing Strategic Training and Development Efforts in the Federal 

Government

What Is Required

What We Found
Audit of NRC’s Oversight of 10 CFR 50.59, “Changes, tests and experiments.”

12

seen or completed formal 50.59 training after the completion of initial 

inspector qualifications.6

In one example, a region independently developed and conducted 10 CFR 

50.59 informal training. This region conducted its own 10 CFR 50.59 

training seminar and disseminated its own training and guidance material 

to inspectors, including those that attended from other regions.

NRC staff characterized the frequency of the recently developed 10 CFR 

50.59 training differently. Agency staff and developers of the 10 CFR 

50.59 Refresher Training, available via NRC’s iLearn online training 

system, indicated that this training is a one-time refresher course created

in response to SONGS lessons learned. The training has been available 

since April, 2016. Furthermore, the training developer stated that each 

year a different reactor inspection topic is selected for an hour long annual 

refresher course for inspectors. In 2016, the 10 CFR 50.59 process was 

the chosen topic. Conversely, the Generic Communications Branch staff 

indicated that the online training module would recur on an annual basis. 

At the time of this audit, staff had not yet reached agreement on whether 

the 10 CFR 50.59 training would recur, and if so, how frequently.

Training Needs Based on Immediate Considerations

NRC’s 10 CFR 50.59 training needs were based on the agency’s 

immediate focus on addressing a SONGS lessons learned training

recommendation. NRC has adopted Office of Personnel Management 

standards7 for training development in NRC’s Human Resources Training 

and Development Operating Procedure No. 0406, Revision 2, Systematic 

Training Program Development Process. This guidance calls for NRC to 

 6 Initial reactor inspector qualification training is identified in Inspection Manual Chapter 1245, Appendix A, 

Basic-Level Training and Qualification Journal; Inspection Manual Chapter 1245, Appendix C-1, Reactor 

Operations Inspector Technical Proficiency Training and Qualification Journal, and Inspection Manual 

Chapter 1245, Appendix C2, Reactor Engineering Inspector Technical Proficiency Training and 

Qualification Journal. 7 The Office of Personnel Management training standards prescribe three levels of training needs 

assessment. Organizational assessment evaluates the level of organizational performance. 

Occupational assessment examines the skills, knowledge, and abilities required for affected occupational 

groups. Individual assessment analyzes how well an individual employee is doing a job and determines 

the individual’s capacity to do new or different work.

Why This Occurred
Audit of NRC’s Oversight of 10 CFR 50.59, “Changes, tests and experiments.”

13

use a systematic approach for training development that includes an 

assessment of organizational, occupational, and individual training needs.

The 10 CFR 50.59 process owner documented its training needs in a 

Human Resources Training and Development Use Request. The request 

included both an initial 1-hour course and an in-depth 16-hour workshop. 

Agency management implemented 10 CFR 50.59 refresher training for the 

staff, thereby limiting the course duration to 1-2 hours in an online format. 

Staff are currently in the process of adding 10 CFR 50.59 refresher 

training content to the reactor technology review courses, as well as, 

determining training frequency.

Implementing 10 CFR 50.59 Training Based on Long-Term Needs 

Could Enhance Knowledge Management Over Time

Implementing 10 CFR 50.59 training based on long-term needs could 

enhance knowledge management over time. Furthermore, addressing 

long-term training needs could help NRC more cost-effectively develop 

training that focuses on key oversight issues and emerging industry 

trends. According to a regional staff member who developed and 

implemented their own 10 CFR 50.59 training, this effort entailed 

significant resource expenditure. The staff member indicated that they 

could not afford to undertake any similar future initiatives. Furthermore, 

this approach could help NRC better prepare its staff to meet the demands 

of changing technological and regulatory environments. By incorporating 

emerging issues and lessons learned into recurring training, NRC is in a 

better position to identify and correct gaps in knowledge, skills, and 

abilities as these requirements change over time.

Recommendation

OIG recommends that the Executive Director for Operations

2. Implement recurring 10 CFR 50.59 training with an emphasis on 

scope, depth, and periodicity of training.

Why This Is Important
Audit of NRC’s Oversight of 10 CFR 50.59, “Changes, tests and experiments.”

14

OIG recommends that the Executive Director for Operations

1. Implement a structured approach for 10 CFR 50.59 process 

management that includes guidance clarification and coordination 

of program communications.

2. Implement recurring 10 CFR 50.59 training with an emphasis on 

scope, depth, and periodicity of training.

 IV. CONSOLIDATED LIST OF RECOMMENDATIONS
Audit of NRC’s Oversight of 10 CFR 50.59, “Changes, tests and experiments.”

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An exit conference was held with the agency on August 9, 2016. After

reviewing a discussion draft, agency management provided comments

that have been incorporated into this report, as appropriate. As a result,

agency management stated their agreement with the findings and

recommendations in this report and opted not to provide formal comments

for inclusion in this report.

 V. AGENCY COMMENTS
Audit of NRC’s Oversight of 10 CFR 50.59, “Changes, tests and experiments.”

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Appendix A

Objective

The audit objective was to assess the consistency and effectiveness of 

NRC’s oversight of 10 CFR 50.59 implementation.

Scope

This audit focused on evaluating NRC’s oversight of the implementation of 

the 10 CFR 50.59 process. We conducted this performance audit from 

February 2016 through June 2016 at NRC headquarters in Rockville, 

Maryland. Internal controls related to the audit objective were reviewed 

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

of fraud, waste, and abuse in the program. 

Methodology

OIG reviewed relevant criteria for this audit, including:

• 10 CFR 50.59, “Changes, tests and experiments.”

• Government Accountability Office’s Standards for Internal Control 

in the Federal Government, GAO-14-704G.

• HUMAN CAPITAL: A Guide for Assessing Strategic Training and 

Development Efforts in the Federal Government, GAO-04-546G.

• Office of Personnel Management, Training and Development 

Planning & Evaluating Training Needs Assessment.

• NRC’s Principles of Good Regulation.

• Regulatory Guide 1.187, Guidance for Implementation of 10 CFR 

50.59, “Changes, tests, and experiments.”

• NRC Enforcement Manual.

• NRC Enforcement Policy.

• Human Resources Training and Development Operating Procedure 

No. 0406 Revision 2, Systematic Training Program Development 

Process.

• NEI 96-07, Revision 1, Guidelines for 10 CFR 50.59 

Implementation.

 OBJECTIVE, SCOPE, AND METHODOLOGY
Audit of NRC’s Oversight of 10 CFR 50.59, “Changes, tests and experiments.”

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To understand how NRC staff and managers oversee the implementation 

of the 10 CFR 50.59 process, OIG reviewed additional sources such as 

NRC Inspection Manual Chapters, Inspection Procedures, inspection 

reports, and agency lessons learned activities related to the 10 CFR 50.59 

process. 

To obtain their perspectives of the 10 CFR 50.59 process, OIG 

interviewed NRC staff from the: Division of Policy and Rulemaking, 

Division of Operating Reactor Licensing, and Division of Inspection and 

Regional Support within the Office of Nuclear Reactor Regulation; Office 

of Enforcement; Office of the Chief Human Capital Officer/Technical 

Training Center; Region I; Region II; Region III; and Region IV. OIG also 

interviewed regional inspectors and interviewed and obtained written 

responses from a sample of senior resident inspectors and resident 

inspectors from Region I, Region II, Region III, and Region IV. 

Representatives from the Nuclear Energy Institute and Union of 

Concerned Scientists were also interviewed for their perspectives on 

NRC’s 10 CFR 50.59 oversight. 

We conducted this performance audit in accordance with generally 

accepted government auditing standards. Those standards require that 

we plan and perform 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 audit was conducted by Paul Rades, Team Leader; Vicki Foster, 

Audit Manager; Timothy Wilson, Senior Analyst; Jenny Cheung, Auditor; 

John Thorp, Senior Technical Advisor; and Urvi Banerjee, Student 

Management Analyst.
Audit of NRC’s Oversight of 10 CFR 50.59, “Changes, tests and experiments.”

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Appendix B

§50.59 Changes, tests and experiments.

(a) Definitions for the purposes of this 

section:

(1) Change means a modification or 

addition to, or removal from, the facility or 

procedures that affects a design function, 

method of performing or controlling the 

function, or an evaluation that demonstrates 

that intended functions will be 

accomplished.

(2) Departure from a method of 

evaluation described in the FSAR (as 

updated) used in establishing the design 

bases or in the safety analyses means:

(i) Changing any of the elements of the 

method described in the FSAR (as updated) 

unless the results of the analysis are 

conservative or essentially the same; or

(ii) Changing from a method described in 

the FSAR to another method unless that 

method has been approved by NRC for the 

intended application.

(3) Facility as described in the final safety 

analysis report (as updated) means:

(i) The structures, systems, and 

components (SSC) that are described in the 

final safety analysis report (FSAR) (as 

updated),

(ii) The design and performance 

requirements for such SSCs described in the 

FSAR (as updated), and

(iii) The evaluations or methods of 

evaluation included in the FSAR (as 

updated) for such SSCs which demonstrate 

that their intended function(s) will be 

accomplished.

(4) Final Safety Analysis Report (as 

updated) means the Final Safety Analysis 

Report (or Final Hazards Summary Report) 

submitted in accordance with §50.34, as 

amended and supplemented, and as updated 

per the requirements of §50.71(e) or 

§50.71(f), as applicable.

(5) Procedures as described in the final 

safety analysis report (as updated) means 

those procedures that contain information 

described in the FSAR (as updated) such as 

how structures, systems, and components 

are operated and controlled (including 

assumed operator actions and response 

times).

(6) Tests or experiments not described in 

the final safety analysis report (as updated)

means any activity where any structure, 

system, or component is utilized or 

controlled in a manner which is either:

(i) Outside the reference bounds of the 

design bases as described in the final safety 

analysis report (as updated) or

(ii) Inconsistent with the analyses or 

descriptions in the final safety analysis 

report (as updated).

(b) This section applies to each holder of 

an operating license issued under this part or 
Audit of NRC’s Oversight of 10 CFR 50.59, “Changes, tests and experiments.”

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a combined license issued under part 52 of 

this chapter, including the holder of a license 

authorizing operation of a production or 

utilization facility, including the holder of a 

license authorizing operation of a nuclear 

power reactor that has submitted the 

certification of permanent cessation of 

operations required under §50.82(a)(1) or 

§50.110 or a reactor licensee whose license 

has been amended to allow possession of 

nuclear fuel but not operation of the facility.

(c)(1) A licensee may make changes in the 

facility as described in the final safety 

analysis report (as updated), make changes 

in the procedures as described in the final 

safety analysis report (as updated), and 

conduct tests or experiments not described 

in the final safety analysis report (as 

updated) without obtaining a license 

amendment pursuant to §50.90 only if:

(i) A change to the technical specifications 

incorporated in the license is not required, 

and

(ii) The change, test, or experiment does 

not meet any of the criteria in paragraph 

(c)(2) of this section.

(2) A licensee shall obtain a license 

amendment pursuant to §50.90 prior to 

implementing a proposed change, test, or 

experiment if the change, test, or experiment 

would:

(i) Result in more than a minimal increase 

in the frequency of occurrence of an 

accident previously evaluated in the final 

safety analysis report (as updated);

(ii) Result in more than a minimal increase 

in the likelihood of occurrence of a 

malfunction of a structure, system, or

component (SSC) important to safety 

previously evaluated in the final safety 

analysis report (as updated);

(iii) Result in more than a minimal 

increase in the consequences of an accident 

previously evaluated in the final safety 

analysis report (as updated);

(iv) Result in more than a minimal 

increase in the consequences of a 

malfunction of an SSC important to safety 

previously evaluated in the final safety 

analysis report (as updated);

(v) Create a possibility for an accident of a 

different type than any previously evaluated 

in the final safety analysis report (as 

updated);

(vi) Create a possibility for a malfunction 

of an SSC important to safety with a 

different result than any previously 

evaluated in the final safety analysis report 

(as updated);

(vii) Result in a design basis limit for a 

fission product barrier as described in the 

FSAR (as updated) being exceeded or 

altered; or

(viii) Result in a departure from a method 

of evaluation described in the FSAR (as 

updated) used in establishing the design

bases or in the safety analyses.

(3) In implementing this paragraph, the 

FSAR (as updated) is considered to include 

FSAR changes resulting from evaluations 
Audit of NRC’s Oversight of 10 CFR 50.59, “Changes, tests and experiments.”

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performed pursuant to this section and 

analyses performed pursuant to §50.90 since 

submittal of the last update of the final 

safety analysis report pursuant to §50.71 of 

this part.

(4) The provisions in this section do not 

apply to changes to the facility or 

procedures when the applicable regulations 

establish more specific criteria for 

accomplishing such changes.

(d)(1) The licensee shall maintain records 

of changes in the facility, of changes in 

procedures, and of tests and experiments 

made pursuant to paragraph (c) of this 

section. These records must include a 

written evaluation which provides the bases 

for the determination that the change, test, or 

experiment does not require a license 

amendment pursuant to paragraph (c)(2) of 

this section.

(2) The licensee shall submit, as specified 

in §50.4 or §52.3 of this chapter, as 

applicable, a report containing a brief 

description of any changes, tests, and 

experiments, including a summary of the 

evaluation of each. A report must be 

submitted at intervals not to exceed 24 

months. For combined licenses, the report 

must be submitted at intervals not to exceed 

6 months during the period from the date of 

application for a combined license to the 

date the Commission makes its findings 

under 10 CFR 52.103(g).

(3) The records of changes in the facility 

must be maintained until the termination of 

an operating license issued under this part, a 

combined license issued under part 52 of 

this chapter, or the termination of a license 

issued under 10 CFR part 54, whichever is 

later. Records of changes in procedures and 

records of tests and experiments must be 

maintained for a period of 5 years.

[64 FR 53613, Oct. 4, 1999]

Effective Date Note: See 64 FR 53582, Oct. 4, 1999, 

for effectiveness of Sec. 50.59. At 65 FR 77773,

Dec. 13, 2000, the effective date of the Oct. 4, 1999 

revision of Sec. 50.59 appearing at 64 FR 53613

was confirmed as Mar. 13, 2001.
Audit of NRC’s Oversight of 10 CFR 50.59, “Changes, tests and experiments.”

21

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Rockville, MD 20852

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