21212 Federal Register / Vol. 61, No. 91 / Thursday, May 9, 1996 / Notices

level, thereby representing a Severity Level

III problem, if the violations reflect the same

underlying cause or programmatic

deficiency, or the violations contributed to or

were unavoidable consequences of the

underlying problem. In this case, the

violations are related, and the lack of

attention and carelessness toward licensed

activities were the underlying causes of the

three violations. Therefore, in accordance

with the Enforcement Policy, the NRC

aggregated the violations into a Severity

Level III problem for which a $12,500 civil

penalty was assessed.

As to the apportionment of the civil

penalty, the violations individually would be

characterized at Severity Level IV and,

therefore, would not be subject to individual

penalties. The regulatory significance of this

Severity Level III problem is the

collectiveness of the problem. Therefore, the

penalty has not been allocated for each

violation. Consequently, the civil penalty

applies to the problem as a whole.

2. The Licensee argued that none of the

violations ‘‘has real safety significance.’’

B&W Fuel stated that its safety analysis of the

BW–2901 package, which was performed

after deviations were found and prior to

further use, was more than adequate. B&W

Fuel added that the NRC does not have a

basis in the regulations for requiring the use

of incredible assumptions, such as an

optimized volume fraction, in post accident

assumptions.

The Licensee contended that the NRC

staff’s new assumptions imposed during the

review of B&W Fuel’s submittal under 10

CFR 71.95 make the analysis appear

inadequate and that this is not the case. The

Licensee stated that it considers some of the

required assumptions to be not credible and

therefore beyond the requirement of 10 CFR

71.55(b)(1) and (2), and that the NRC

ultimately agreed with B&W Fuel’s analysis

and authorized it to use the containers with

the deviations present.

NRC Evaluation

Safety significance, from an enforcement

prospective, involves consideration of: (1)

actual safety consequence; (2) potential safety

consequence; and (3) regulatory significance.

Violation A is of concern because of the

potential criticality consequence of B&W

Fuel’s use of shipping packages that were not

constructed as required and for which an

adequate safety evaluation had not been

performed. Violation B is of concern because

the violation continued for over two years

which demonstrates a lack of management

oversight (i.e., B&W Fuel failed to identify

the violation, although the cylinders were

readily visible during that time). Violation C

is of concern because, in each example of the

violation, the NRC relied upon inaccurate

information submitted by the Licensee to

make a regulatory decision.

While the actual safety consequences of the

violations fortunately turned out to be

minimal in this case, the regulatory concerns

are significant due to B&W Fuel’s lack of

attention to licensed activities. Specifically,

the lack of attention to regulated activities

was not isolated, but spanned several areas

including licensing, transportation, quality

assurance, and material control and

accountability, and directly resulted in the

three violations described in the Notice.

Therefore, the NRC concludes that, taken

collectively, the violations represent a

significant regulatory concern.

The NRC disagrees with the Licensee’s

statements regarding the adequacy of its

safety analysis. When B&W Fuel evaluated

the safety significance of the larger

containment vessel, the Licensee incorrectly

considered the wooden boards (i.e., box) to

be structural components that would confine

the fissile material under accident

conditions. This is not consistent with the

safety basis of the package or previous B&W

Fuel analyses. The NRC did not, and does

not, agree with B&W Fuel’s safety assessment

dated July 7, 1995. Furthermore, the NRC did

not authorize the Licensee to use the BW–

2901 shipping packages with the deviations

present unless certain conditions were met;

specifically, installation of borated aluminum

poison plates, or restricting shipments to

large size pellets with a stainless steel

separator plate. In view of the above, the NRC

concludes that the Licensee’s safety analysis

of the BW–2901 shipping package was

inadequate.

3. The Licensee stated that it does not

understand why the NRC did not give B&W

Fuel credit for its corrective actions or the

cost of meeting the requirements imposed by

the NRC assumptions in the analysis for the

BW–2901 shipping containers. The Licensee

argues that it has been very proactive in this

case and took action which prevented any

reduction in the protection of the public’s

health and safety. Specifically, when NRC

management indicated that it considered that

B&W Fuel’s action was outside the NRC’s

interpretation of Part 71, B&W Fuel

immediately stopped using the containers

and submitted a request for modification of

the COC.

The Licensee claimed that, despite its

belief it acted entirely in accordance with its

approved QAP, B&W Fuel agreed to comply

with the NRC position on 10 CFR 71.12(c)(2)

and did so voluntarily on July 20, 1995. B&W

Fuel stated that it has operated in accordance

with NRC’s wishes and is not using the

provisions of its QAP, which allows the

Licensee to use containers with deviations

that are shown by analysis to have no safety

significance. The Licensee asserted that

corrective action was taken to prevent

recurrence in 1990 with a re-design of the

procedures which govern shipping container

manufacture and use, and that these

procedures were demonstrated to be effective

during the procurement of new Model 51032

containers in 1993. The Licensee, therefore,

disagreed with the NRC’s statement in the

Notice that ‘‘absent NRC action, FCF would

have continued to use nonconforming

packages without NRC approval and without

performing an adequate safety analysis.’’

NRC Evaluation

NRC did not give B&W Fuel credit for

corrective actions because the NRC had to

take action to focus the Licensee’s evaluative

and corrective process to obtain

comprehensive corrective action.

Specifically, for Violation A: (1) as noted in

Section 2 of this Appendix, B&W Fuel’s

safety analysis of the BW–2901 shipping

package was inadequate; and (2) the Licensee

continued to use nonconforming packages

after performing its analysis until the NRC

staff informed B&W Fuel staff that it was not

authorized to do so.

B&W Fuel was initially informed by the

NRC staff via telephone on May 24, 1995, as

a result of identification of the bolt hole

discrepancies, that it was not authorized to

use packaging that does not meet the

drawings listed in the COC. In the telephone

conversation, B&W Fuel was requested to

submit revised pages to the safety analysis

report to clarify that packages must conform

to the drawings specified in the Certificate of

Compliance.

By letter dated May 24, 1995, B&W Fuel

submitted revised pages for the BW–2901

safety analysis report. The revised acceptance

tests included the following statements:

‘‘Containers will be fabricated only in

accordance with the designed drawings

referenced in the Certificate of Compliance.

The approved Quality Assurance Manual

will be used to ensure compliance. Any

changes in the drawings shall be submitted

to NRC for approval.’’ Based on this, NRC

staff understood that B&W Fuel would not

use packaging that deviated from the

drawings referenced in the Certificate of

Compliance, without prior NRC approval.

Contrary to the communications, and based

on its erroneous interpretation of the use of

its QAP, B&W Fuel used the BW–2901

packaging that did not conform to the

drawings following identification of the inner

dimensional discrepancies until July 20,

1995, when the NRC staff reiterated the

regulatory requirements to the Licensee.

While the NRC acknowledges that B&W Fuel

ultimately agreed to stop using the BW–2901

shipping package, the Licensee, absent NRC

involvement, would have continued to use

the nonconforming packages. Therefore, the

NRC concludes that its statement in the

Notice was appropriate.

With regard to Violations B, the Licensee

did not provide additional corrective actions

which were not already considered after the

November 21, 1995 predecisional

enforcement conference. As stated in the

Notice, although the initial corrective actions

for Violation B were appropriate, the

adequacy of the long term corrective action

is yet to be demonstrated. The corrective

actions for violation C were adequate.

Therefore, the NRC concludes that, in

accordance with Section VI.B.2 of the

Enforcement Policy, credit for the Licensee’s

corrective action is not warranted.

NRC Conclusion

The NRC has concluded that the violations

in the Notice were correctly categorized as a

Severity Level III problem, and that the

Licensee did not provide an adequate basis

for mitigation of the civil penalty.

Consequently, the proposed civil penalty in

the amount of $12,500 should be imposed.

[FR Doc. 96–11606 Filed 5–8–96; 8:45 am]

BILLING CODE 7590–01–P
Federal Register / Vol. 61, No. 91 / Thursday, May 9, 1996 / Notices 21213

[Docket No. 50–440]

The Cleveland Electric Illuminating

Company, et al.; Notice of

Consideration of Issuance of

Amendment to Facility Operating

License, Proposed No Significant

Hazards Consideration Determination,

and Opportunity for a Hearing

The U.S. Nuclear Regulatory

Commission (the Commission) is

considering issuance of an amendment

to Facility Operating License No. NPF–

58 issued to The Cleveland Electric

Illuminating Company, et al. (the

licensee), for operation of the Perry

Nuclear Power Plant, Unit No. 1 located

in Lake County, Ohio.

The proposed amendment would

correct minor technical and

administrative errors in the Improved

Technical Specifications (ITS) prior to

ITS implementation.

Before issuance of the proposed

license amendment, the Commission

will have made findings required by the

Atomic Energy Act of 1954, as amended

(the Act) and the Commission’s

regulations.

The Commission has made a

proposed determination that the

amendment request involves no

significant hazards consideration. Under

the Commission’s regulations in 10 CFR

50.92, this means that operation of the

facility in accordance with the proposed

amendment would not (1) involve a

significant increase in the probability or

consequences of an accident previously

evaluated; or (2) create the possibility of

a new or different kind of accident from

any accident previously evaluated; or

(3) involve a significant reduction in a

margin of safety. As required by 10 CFR

50.91(a), the licensee has provided its

analysis of the issue of no significant

hazards consideration, which is

presented below:

1. The proposed changes do not involve a

significant increase in the probability or

consequences of an accident previously

evaluated.

Eight of the proposed changes are

administrative in nature and either correct

errors or incorporate into the improved

Technical Specifications a change which was

approved by the NRC under Amendment 70

for the current Technical Specifications.

Changing the classification of the Backup

Hydrogen Purge System isolation valves from

drywell isolation valves to primary

containment isolation valves results in the

same actions being taken in the event one of

these valves is declared inoperable. However,

the Completion Times are more restrictive for

inoperable primary containment isolation

valves than for inoperable drywell isolation

valves. The proposed changes to the diesel

generator fuel oil day tank minimum

volumes provide more stringent requirements

for operation of the facility to increase the

reliability of the diesel generator fuel oil

transfer pump operation. The more stringent

requirements continue to ensure that the

safety analysis and licensing basis are

maintained. The proposed change to

Specification 5.7.3 clarifies continuously

guarding a high radiation area is an option,

not a requirement. The proposed changes

have been reviewed and determined to have

no affect on accident conditions or

assumptions.

Based on the above, the proposed changes

do not significantly increase the probability

or consequences of any accident previously

evaluated.

2. The proposed changes do not create the

possibility of a new or different kind of

accident from any accident previously

evaluated.

As stated above eight of the proposed

changes are administrative in nature and do

not increase the possibility of any new or

different kind of accident. Changing the

classification of the Backup Hydrogen Purge

System isolation valves from drywell

isolation valves to primary containment

isolation valves results in the same actions

being taken in the event one of these valves

is declared inoperable. However, the

Completion Times are more restrictive for

inoperable primary containment isolation

valves than for inoperable drywell isolation

valves. The proposed changes to the diesel

generator fuel oil day tank minimum

volumes do not involve installation of new

or different equipment nor do they change

the methods governing normal plant

operations. These changes are also consistent

with assumptions made in the safety analysis

and licensing basis. Clarifying the controls of

high radiation areas will not impact existing

or introduce any new accident precursors.

The proposed changes do not create the

possibility of a new or different kind of

accident since they do not affect the reactor

coolant pressure boundary or reactivity

controls. Consequently, no new failure

modes are introduced as a result of the

proposed changes.

Therefore, the proposed changes do not

create the possibility of a new or different

kind of accident from any previously

evaluated.

3. The proposed changes do not involve a

significant reduction in a margin of safety.

The margin of safety is unchanged because

the proposed administrative changes do not

affect any design basis or accident

assumptions. Changing the classification of

the Backup Hydrogen Purge System isolation

valves from drywell isolation valves to

primary containment isolation valves results

in the same actions being taken in the event

one of these valves is declared inoperable.

However, the Completion Times are more

restrictive for inoperable primary

containment isolation valves than for

inoperable drywell isolation valves. The

imposition of more restrictive requirements

for the diesel generator fuel oil day tank

minimum volumes results from the

implementation of the Bases for the

Technical Specification Surveillance

Requirement. Clarifying the controls of high

radiation areas is consistent with ALARA

practices.

Therefore, the proposed changes do not

involve a significant reduction in a margin of

safety.

The NRC staff has reviewed the

licensee’s analysis and, based on this

review, it appears that the three

standards of 10 CFR 50.92(c) are

satisfied. Therefore, the NRC staff

proposes to determine that the

amendment request involves no

significant hazards consideration.

The Commission is seeking public

comments on this proposed

determination. Any comments received

within 30 days after the date of

publication of this notice will be

considered in making any final

determination.

Normally, the Commission will not

issue the amendment until the

expiration of the 30-day notice period.

However, should circumstances change

during the notice period such that

failure to act in a timely way would

result, for example, in preventing

startup of the facility, the Commission

may issue the license amendment before

the expiration of the 30-day notice

period, provided that its final

determination is that the amendment

involves no significant hazards

consideration. The final determination

will consider all public and State

comments received. Should the

Commission take this action, it will

publish in the Federal Register a notice

of issuance and provide for opportunity

for a hearing after issuance. The

Commission expects that the need to

take this action will occur very

infrequently.

Written comments may be submitted

by mail to the Rules Review and

Directives Branch, Division of Freedom

of Information and Publications

Services, Office of Administration, U.S.

Nuclear Regulatory Commission,

Washington, DC 20555, and should cite

the publication date and page number of

this Federal Register notice. Written

comments may also be delivered to

Room 6D22, Two White Flint North,

11545 Rockville Pike, Rockville,

Maryland, from 7:30 a.m. to 4:15 p.m.

Federal workdays. Copies of written

comments received may be examined at

the NRC Public Document Room, the

Gelman Building, 2120 L Street, NW.,

Washington, DC.

The filing of requests for hearing and

petitions for leave to intervene is

discussed below.

By June 10, 1996, the licensee may

file a request for a hearing with respect

to issuance of the amendment to the

subject facility operating license and

any person whose interest may be

affected by this proceeding and who

wishes to participate as a party in the
21214 Federal Register / Vol. 61, No. 91 / Thursday, May 9, 1996 / Notices

proceeding must file a written request

for a hearing and a petition for leave to

intervene. Requests for a hearing and a

petition for leave to intervene shall be

filed in accordance with the

Commission’s ‘‘Rules of Practice for

Domestic Licensing Proceedings’’ in 10

CFR Part 2. Interested persons should

consult a current copy of 10 CFR 2.714

which is available at the Commission’s

Public Document Room, the Gelman

Building, 2120 L Street, NW.,

Washington, DC, and at the local public

document room located at the Perry

Public Library, 3753 Main Street, Perry,

Ohio. If a request for a hearing or

petition for leave to intervene is filed by

the above date, the Commission or an

Atomic Safety and Licensing Board,

designated by the Commission or by the

Chairman of the Atomic Safety and

Licensing Board Panel, will rule on the

request and/or petition; and the

Secretary or the designated Atomic

Safety and Licensing Board will issue a

notice of hearing or an appropriate

order.

As required by 10 CFR 2.714, a

petition for leave to intervene shall set

forth with particularity the interest of

the petitioner in the proceeding, and

how that interest may be affected by the

results of the proceeding. The petition

should specifically explain the reasons

why intervention should be permitted

with particular reference to the

following factors: (1) The nature of the

petitioner’s right under the Act to be

made party to the proceeding; (2) the

nature and extent of the petitioner’s

property, financial, or other interest in

the proceeding; and (3) the possible

effect of any order which may be

entered in the proceeding on the

petitioner’s interest. The petition should

also identify the specific aspect(s) of the

subject matter of the proceeding as to

which petitioner wishes to intervene.

Any person who has filed a petition for

leave to intervene or who has been

admitted as a party may amend the

petition without requesting leave of the

Board up to 15 days prior to the first

prehearing conference scheduled in the

proceeding, but such an amended

petition must satisfy the specificity

requirements described above.

Not later than 15 days prior to the first

prehearing conference scheduled in the

proceeding, a petitioner shall file a

supplement to the petition to intervene

which must include a list of the

contentions which are sought to be

litigated in the matter. Each contention

must consist of a specific statement of

the issue of law or fact to be raised or

controverted. In addition, the petitioner

shall provide a brief explanation of the

bases of the contention and a concise

statement of the alleged facts or expert

opinion which support the contention

and on which the petitioner intends to

rely in proving the contention at the

hearing. The petitioner must also

provide references to those specific

sources and documents of which the

petitioner is aware and on which the

petitioner intends to rely to establish

those facts or expert opinion. Petitioner

must provide sufficient information to

show that a genuine dispute exists with

the applicant on a material issue of law

or fact. Contentions shall be limited to

matters within the scope of the

amendment under consideration. The

contention must be one which, if

proven, would entitle the petitioner to

relief. A petitioner who fails to file such

a supplement which satisfies these

requirements with respect to at least one

contention will not be permitted to

participate as a party.

Those permitted to intervene become

parties to the proceeding, subject to any

limitations in the order granting leave to

intervene, and have the opportunity to

participate fully in the conduct of the

hearing, including the opportunity to

present evidence and cross-examine

witnesses.

If a hearing is requested, the

Commission will make a final

determination on the issue of no

significant hazards consideration. The

final determination will serve to decide

when the hearing is held.

If the final determination is that the

amendment request involves no

significant hazards consideration, the

Commission may issue the amendment

and make it immediately effective,

notwithstanding the request for a

hearing. Any hearing held would take

place after issuance of the amendment.

If the final determination is that the

amendment request involves a

significant hazards consideration, any

hearing held would take place before

the issuance of any amendment.

A request for a hearing or a petition

for leave to intervene must be filed with

the Secretary of the Commission, U.S.

Nuclear Regulatory Commission,

Washington, DC 20555, Attention:

Docketing and Services Branch, or may

be delivered to the Commission’s Public

Document Room, the Gelman Building,

2120 L Street, NW., Washington, DC, by

the above date. Where petitions are filed

during the last 10 days of the notice

period, it is requested that the petitioner

promptly so inform the Commission by

a toll-free telephone call to Western

Union at 1–(800) 248–5100 (in Missouri

1-(800) 342–6700). The Western Union

operator should be given Datagram

Identification Number N1023 and the

following message addressed to Gail H.

Marcus: petitioner’s name and

telephone number, date petition was

mailed, plant name, and publication

date and page number of this Federal

Register notice. A copy of the petition

should also be sent to the Office of the

General Counsel, U.S. Nuclear

Regulatory Commission, Washington,

DC 20555, and to Jay E. Silberg, Shaw,

Pittman, Potts & Trowbridge, 2300 N

Street, NW., Washington, DC 20037,

attorney for the licensee.

Nontimely filings of petitions for

leave to intervene, amended petitions,

supplemental petitions and/or requests

for hearing will not be entertained

absent a determination by the

Commission, the presiding officer or the

presiding Atomic Safety and Licensing

Board that the petition and/or request

should be granted based upon a

balancing of the factors specified in 10

CFR 2.714(a)(1) (i)–(v) and 2.714(d).

For further details with respect to this

action, see the application for

amendment dated April 26, 1996, which

is available for public inspection at the

Commission’s Public Document Room,

the Gelman Building, 2120 L Street,

NW., Washington, DC, and at the local

public document room located at the

Perry Public Library, 3753 Main Street,

Perry, Ohio.

Dated at Rockville, Maryland, this 3rd day

of May 1996.

For the Nuclear Regulatory Commission.

Jon B. Hopkins, Sr.,

Project Manager, Project Directorate III–3,

Division of Reactor Projects—III/IV, Office of

Nuclear Reactor Regulation.

[FR Doc. 96–11603 Filed 5–8–96; 8:45 am]

BILLING CODE 7590–01–P

SECURITIES AND EXCHANGE

COMMISSION

[Investment Company Act Release No.

21936; 811–4502]

Pierre Funding Corporation; Notice of

Application

May 2, 1996.

AGENCY: Securities and Exchange

Commission (‘‘SEC’’).

ACTION: Notice of Application for

Deregistration under the Investment

Company Act of 1940 (the ‘‘Act’’).

APPLICANT: Pierre Funding Corporation.

RELEVANT ACT SECTION: Order requested

under Section 8(f).

SUMMARY OF APPLICATION: Applicant

seeks an order declaring it has ceased to

be an investment company.

FILING DATE: The application was filed

on December 18, 1995, and was

amended on April 30, 1996.