[Federal Register Volume 61, Number 106 (Friday, May 31, 1996)]
[Notices]
[Pages 27373-27374]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-13673]



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NUCLEAR REGULATORY COMMISSION
[Docket No. 999-90004; License No. KS 22-B274-0;1 EA 95-276]


Bemis Construction, Inc.; Order Imposing Civil Monetary Penalty

I

    Bemis Construction, Inc., (Bemis) is the holder of Radioactive 
Materials License No. 22-B274-01, a specific license issued by the 
state of Kansas, an Agreement State on September 30, 1987. The license 
authorizes Bemis to possess and use sealed radioactive sources in 
portable nuclear density gauges at a specific location in Great Bend, 
Kansas and at temporary jobsites in the State of Kansas in accordance 
with the conditions specified in the license. Pursuant to 10 CFR 150.20 
and its license, a general license is granted to Agreement State 
licensees to conduct the same activities in areas under NRC 
jurisdiction (referred to as ``reciprocity''), provided that the NRC is 
notified and the other provisions of 10 CFR 150.20 are followed.

II

    An inspection and investigation of Bemis's activities were 
conducted during August 17, 1995, through January 3, 1996. The results 
of the inspection and investigation, documented in a report issued on 
January 11, 1996, indicated that Bemis had not conducted its activities 
in full compliance with NRC requirements. The violations identified 
included use and storage of licensed material in NRC jurisdiction 
without having complied with the requirements for reciprocity. Bemis 
responded to the inspection report by letter dated January 22, 1996. In 
its letter, Bemis stated that the reason for the violation was an 
understanding that the gauge could be used in Oklahoma for short 
periods of time. A written Notice of Violation and Proposed Imposition 
of Civil Penalty (Notice) was served upon Bemis by letter dated March 
19, 1996. The Notice stated the nature of the violation, the provisions 
of the NRC requirements that Bemis had violated, and the amount of the 
civil penalty proposed for the violation.
    Bemis responded to the Notice by letter dated April 17, 1996 (Reply 
to a Notice of Violation and Answer to a Notice of Violation). In its 
response, Bemis stated that there was an apparent mistaken belief that 
a reciprocity permit with the NRC was not required under certain 
conditions. The letter also requested mitigation of the proposed civil 
penalty based on assurances that Bemis is in compliance now and will 
not violate the cited requirements in the future.

III

    After consideration of Bemis's response and the statements of fact, 
explanation, and argument for mitigation contained therein, the NRC 
staff has determined, as set forth in the Appendix to this Order, that 
the violations occurred as described in the Notice, and that the 
penalty proposed for the violations should be imposed by order.

IV

    In view of the foregoing and pursuant to Section 234 of the Atomic 
Energy Act of 1954, as amended (Act), 42 U.S.C. 2282, and 10 CFR 2.205, 
It is hereby ordered that:
    Bemis Construction, Inc., pay a civil penalty in the amount of 
$2,500 within 30 days of the date of this Order, by check, draft, money 
order, or electronic transfer, payable to the Treasurer of the United 
States and mailed to James Lieberman, Director, Office of

[[Page 27374]]

Enforcement, U.S. Nuclear Regulatory Commission, One White Flint North, 
11555 Rockville Pike, Rockville, MD 20852-2738.

V

    Bemis may request a hearing within 30 days of the date of this 
Order. Where good cause is shown, consideration will be given to 
extending the time to request a hearing. A request for extension of 
time must be made in writing to the Director, Office of Enforcement, 
U.S. Nuclear Regulatory Commission Washington, D.C. 20555, and include 
a statement of good cause for the extension. A request for a hearing 
should be clearly marked as a ``Request for an Enforcement Hearing'' 
and shall be addressed to the Director, Office of Enforcement, U.S. 
Nuclear Regulatory Commission Washington, D.C. 20555, with a copy to 
the Commission's Document Control Desk, Washington, D.C. 20555. Copies 
also shall be sent to the Assistant General Counsel for Hearings and 
Enforcement at the same address and to the Regional Administrator, NRC 
Region IV, 611 Ryan Plaza Drive, Suite 400, Arlington, Texas 76011.
    If a hearing is requested, the Commission will issue an Order 
designating the time and place of the hearing. If Bemis fails to 
request a hearing within 30 days of the date of this Order (or if 
written approval of an extension of time in which to request a hearing 
has not been granted), the provisions of this Order shall be effective 
without further proceedings. If payment has not been made by that time, 
the matter may be referred to the Attorney General for collection.
    In the event Bemis requests a hearing as provided above, the issue 
to be considered at such hearing shall be: whether, on the basis of the 
violation admitted by Bemis, this Order should be sustained.

    Dated at Rockville, Maryland this 23rd day of May 1996.
    For the Nuclear Regulatory Commission.

James Lieberman,
Director, Office of Enforcement.

Appendix--Evaluation and Conclusions

    On March 19, 1996, a Notice of Violation and Proposed Imposition 
of Civil Penalty (Notice) in the amount of $2,500 was issued to 
Bemis Construction, Inc., (Bemis) for a violation identified during 
an NRC inspection and investigation. Bemis responded to the Notice 
in a letter dated April 17, 1996. Bemis admitted the violation but 
requested mitigation of the proposed civil penalty based on its 
contention that the violation was not intentional and on assurances 
that Bemis is in compliance now and will not, in the future, violate 
the rules which were cited.

Restatement of Violation Assessed a Civil Penalty

    10 CFR 30.3 requires in relevant part, that no person shall 
possess or use byproduct material except as authorized by a specific 
or general license issued by the NRC.
    10 CFR 150.20(a) provides in part that any person who holds a 
specific license from an Agreement State is granted an NRC general 
license to conduct the same activity in non-Agreement States subject 
to the provisions of 10 CFR 150.20(b).
    10 CFR 150.20(b)(1) requires, in part, that any person engaging 
in activities in non-Agreement States shall, at least 3 days before 
engaging in each such activity, file 4 copies of NRC Form-241, 
``Report of Proposed Activities in Non-Agreement States,'' with the 
Regional Administrator of the appropriate NRC regional office.
    Contrary to the above,
    A. From March 1991 through August 1992, Bemis Construction, Inc. 
a licensee of Kansas, used cesium-137 and americium-241 sealed 
sources in Oklahoma, a non-Agreement State, without a specific 
license issued by the NRC and without filing Form-241 with the NRC.
    B. From March 1991 through July 1995, Bemis Construction, Inc. a 
licensee of Kansas, stored cesium-137 and americium-241 sealed 
sources in Oklahoma, a non-Agreement State, without a specific 
license issued by the NRC and without filing Form-241 with the NRC. 
(01013)
    This is a Severity Level III violation (Supplement VI). Civil 
Penalty--$2,500

Summary of Bemis's Request for Mitigation

    Bemis responded to the violation in a letter from Mr. Thomas J. 
Berscheidt, Attorney At Law, dated April 17, 1996. Mr. Berscheidt 
stated that he represents Bemis and that he had reviewed the March 
19, 1996, letter from the NRC and the enclosed Notice. Mr. 
Berscheidt's letter stated that there was no intent to avoid 
compliance with the regulations. There was ``simply a 
misunderstanding and lack of information concerning these 
regulations.'' Bemis stated that it will not, now or in the future, 
regardless of the oversight or lack of knowledge, intentionally 
violate any of the rules and regulations of the NRC. Further, 
Bemis's response stated that it is recognized that each party is 
responsible for being aware of the rules and regulations, but there 
are times when, regardless of the effort and honest intent of any 
individual or corporation, all rules and regulations cannot be known 
or at least readily obtained and usually the awareness factor does 
not surface until the violation has been identified. With the 
assurance that Bemis is in compliance and will not violate the rules 
which were cited, the licensee requested mitigation of the civil 
penalty. The letter also noted that this was the first time that 
Bemis has violated NRC requirements.

NRC Evaluation of Licensee's Request for Mitigation

    The Kansas license provided that material ``may be used at 
Railroad & McKinley, Great Bend, Kansas and at temporary job sites 
of the licensee anywhere in the State of Kansas where the State of 
Kansas, Department of Health and Environment maintains jurisdiction 
for regulating the use of radioactive material.'' This provision 
does not authorize operations in the State of Oklahoma, which is 
under NRC jurisdiction. Therefore, it is not clear why there was any 
misunderstanding. The fact that Bemis did not attempt to verify its 
understanding by merely telephoning the NRC, or make any other 
effort to verify its understanding, was the basis for NRC's 
conclusion that the violation was the result of, at least, careless 
disregard for the involved requirements.
    Even in the absence of willfulness, the NRC considers the 
failure to obtain authorization to use byproduct materials in areas 
under its jurisdiction to be a matter of significant regulatory 
concern. This is because the failure to obtain NRC authorization for 
such activities denies the NRC the opportunity to assure that the 
activities are conducted in compliance with all NRC requirements. 
Furthermore, the failure to obtain authorization resulted in Bemis's 
failure to pay fees in each of the years that Bemis was in 
violation. We note that the civil penalty is approximately the same 
amount as the delinquent fees.
    Bemis concludes its April 17 letter with its assurances of 
compliance (with the cited requirements), now and in the future, and 
respectfully requested that the civil penalty be reduced. The NRC's 
Enforcement Policy does provide for mitigation of civil penalties 
under certain conditions, through the consideration of the 
identification and corrective action factors (reference Section 
VI.B.2 of the enforcement policy). The NRC's March 19, 1996 letter 
that accompanied the Notice described the NRC's analysis of these 
identification and corrective action factors, and concluded that the 
base penalty should be assessed. The licensee's April 17 letter did 
not provide any additional information that would change the civil 
penalty assessment.

NRC Conclusion

    After consideration of all of the arguments made by Bemis, the 
NRC concludes that the civil penalty that was proposed should not be 
mitigated.

[FR Doc. 96-13673 Filed 5-30-96; 8:45 am]
BILLING CODE 7590-01-P