53286 Federal Register / Vol. 73, No. 179 / Monday, September 15, 2008 / Notices 

the Final Environmental Impact 

Statement (NUREG–1437, Supplement 

31) may be purchased from the National 

Technical Information Service, U.S. 

Department of Commerce, Springfield, 

VA 22161–0002 (http://www.ntis.gov), 

703–605–6000, or the Superintendent of 

Documents, U.S. Government Printing 

Office, P.O. Box 371954, Pittsburgh, PA 

15250–7954 (http:// 

www.gpoaccess.gov), 202–512–1800. All 

orders should clearly identify the NRC 

publication number and the requester’s 

Government Printing Office deposit 

account number or a VISA or 

MasterCard number and expiration date. 

Dated at Rockville, Maryland, this 8th day 

of September 2008. 

For the Nuclear Regulatory Commission. 

Brian E. Holian, 

Director, Division of License Renewal, Office 

of Nuclear Reactor Regulation. 

[FR Doc. E8–21430 Filed 9–12–08; 8:45 am] 

BILLING CODE 7590–01–P 

NUCLEAR REGULATORY 

COMMISSION 

[NRC–2008–0497] 

NRC Enforcement Policy Revision 

AGENCY: Nuclear Regulatory 

Commission. 

ACTION: Notice of availability of draft 

and request for comments. 

SUMMARY: The Nuclear Regulatory 

Commission (NRC) is revising its 

Enforcement Policy (Enforcement Policy 

or Policy) to more appropriately address 

the various areas that the NRC regulates, 

providing a framework that supports 

consistent implementation of the 

Enforcement Policy. A notice was 

published on January 25, 2007, 

announcing that the NRC was 

undertaking a major revision of the 

Enforcement Policy to clarify the use of 

terms and update the Policy, removing 

outdated information and adding 

information addressing enforcement 

issues in areas that are not currently 

directly addressed in the Policy. The 

NRC is now soliciting written comments 

from interested parties including public 

interest groups, states, members of the 

public and the regulated industry, i.e., 

reactor and materials licensees, vendors, 

and contractors, on the proposed 

revised Policy. This request is intended 

to assist the NRC in revising the 

Enforcement Policy; NRC does not 

intend to modify its emphasis on 

compliance with NRC requirements. 

DATES: Submit comments on or before 

November 14, 2008. This time period 

allows for the public to respond to this 

notice as well as the opportunity to 

provide general comments on the 

revision of the Policy. Comments 

received after this date will be 

considered if it is practical to do so, but 

the Commission is able to assure 

consideration only for comments 

received on or before this date. 

ADDRESSES: Comments will be made 

available to the public in their entirety; 

personal information, such as your 

name, address, telephone number, email address, etc. will not be removed 

from your submission. You may submit 

comments by any one of the following 

methods: 

Federal e-Rulemaking Portal: http:// 

www.regulations.gov; search on docket 

ID: NRC–2008–0497. 

Mail comments to: Michael T. Lesar, 

Chief, Rulemaking, Directives, and 

Editing Branch, Office of 

Administration, Mail Stop: T–6D59, 

U.S. Nuclear Regulatory Commission, 

Washington, DC 20555–0001. 

Hand-deliver comments to: 11555 

Rockville Pike, Rockville, MD 20852, 

between the hours of 7:45 a.m. and 4:15 

p.m., Federal workdays. 

You can access publicly available 

documents related to this notice using 

the following methods: 

Federal e-Rulemaking Portal: 

Documents related to this notice, 

including public comments, are 

accessible at http:// 

www.regulations.gov, by searching on 

docket ID: NRC–2008–0497. 

NRC’s Public Document Room (PDR): 

The public may examine and have 

copied for a fee, publicly available 

documents at the NRC’s PDR, Public 

File Area O–1F21, One White Flint 

North, 11555 Rockville Pike, Rockville, 

Maryland. 

NRC’s Agencywide Document Access 

and Management System (ADAMS): The 

draft Enforcement Policy is available 

electronically at the NRC’s Electronic 

Reading Room at http://www.nrc.gov/ 

reading-rm/adams.html under ADAMS 

Accession Number ML082520457. From 

this site, the public can gain entry into 

ADAMS, which provides text and image 

files of the NRC’s public documents. In 

addition, the draft Enforcement Policy 

will be available at http://www.nrc.gov/ 

about-nrc/regulatory/enforcement/ 

enforce-pol.html. If you do not have 

Internet access or if there are problems 

in accessing the documents located in 

ADAMS, contact the PDR Reference 

staff at 1–800–397–4209, 301–415–4737 

or by e-mail to pdr.resource@nrc.gov. 

FOR FURTHER INFORMATION CONTACT: 

Doug Starkey, Office of Enforcement, 

U.S. Nuclear Regulatory Commission, 

Washington, DC 20555; 

Doug.Starkey@nrc.gov, (301) 415–3456. 

SUPPLEMENTARY INFORMATION: 

I. Background 

The NRC Enforcement Policy contains 

the enforcement policy and procedures 

that the U.S. Nuclear Regulatory 

Commission (NRC) uses to consider 

potential enforcement actions in 

response to apparent violations of NRC 

requirements. The primary purpose of 

the Enforcement Policy is to support the 

NRC’s overall safety mission, i.e., to 

ensure adequate protection of public 

health and safety, promote the common 

defense and security, and protect the 

environment. Because it is a policy 

statement and not a regulation, the 

Commission may deviate from this 

statement of policy as appropriate under 

the circumstances of a particular case. 

The Enforcement Policy was first 

published in the Federal Register on 

October 7, 1980 (46 FR 66754), as an 

interim policy. The Commission 

published a final version of the Policy 

on March 9, 1982 (47 FR 9987). The 

Enforcement Policy has been modified 

on a number of occasions to address 

changing requirements and additional 

experience and on June 30, 1995 (60 FR 

34381), a major revision of the Policy 

was published. The NRC maintains the 

Enforcement Policy on its Web site at 

http://www.nrc.gov; select Public 

Meetings and Involvement, 

Enforcement, and then Enforcement 

Policy. 

The goal of the Policy is to support 

the NRC’s safety and security mission 

by emphasizing the importance of 

compliance with regulatory 

requirements, and encouraging prompt 

identification, and prompt, 

comprehensive correction of violations. 

Revisions to the Policy have 

consistently reflected this commitment: 

for example, in 1998, the NRC changed 

its inspection procedures to address the 

Reactor Oversight Process (ROP) 

initiative. This has been reflected in the 

Policy’s use of risk insights to assess the 

significance of violations whenever 

possible. While this may result in fewer 

Notices of Violation being issued 

(because of a greater emphasis on the 

use of non-cited violations), it has not 

reduced the agency’s emphasis on the 

importance of compliance with NRC 

requirements. Another example 

involves the NRC’s development of a 

pilot program in 2005 which focuses on 

the use of Alternative Dispute 

Resolution (ADR) for certain kinds of 

enforcement cases. The NRC 

enforcement staff has used ADR to 

resolve reactor, fuel facility, and 

materials enforcement cases. While the 

use of ADR in enforcement raises 

unique issues, it emphasizes creative, 

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Federal Register / Vol. 73, No. 179 / Monday, September 15, 2008 / Notices 53287 

cooperative approaches to handling 

conflicts in lieu of adversarial 

procedures. 

The NRC is again proceeding with 

making a major revision to its 

Enforcement Policy. As discussed 

above, since it was first published in 

1980, sections of the Policy have been 

updated and additional sections have 

been included. Terms used under 

conventional enforcement are now 

associated with the significance 

determination process (SDP) performed 

under the ROP as well; therefore, the 

use of these terms must be clarified. In 

addition, there are areas that are not 

directly addressed in the Supplements 

of the Enforcement Policy, such as the 

enforcement issues associated with 

combined licenses for the proposed new 

reactors and the construction phase of 

proposed fuel facilities as well as 

recently promulgated requirements in 

the safeguards and security area. These 

areas must be addressed either by 

adding them to the text of the existing 

Policy and Supplements or by revising 

the Policy and developing new 

Supplements. Finally, the format of the 

Enforcement Policy is being reorganized 

to reflect the changes that have been 

made to it. 

II. Proposed Plan 

The NRC envisions revising the 

Enforcement Policy so that the policy 

statement follows the actual 

enforcement process. The NRC’s 

enforcement process has three basic 

steps: first, violations must be 

identified; next, the NRC must assess 

the significance or severity of the 

violation; and finally, the NRC must 

disposition the violation. Throughout 

the process, an organization or 

individual subject to an NRC 

enforcement action has multiple 

opportunities to provide input. 

In order for the policy to follow the 

actual enforcement process some of the 

material in the current Enforcement 

Policy has been either removed entirely 

from the revised Policy or relocated to 

the NRC Enforcement Manual. The 

intent is that this revised Policy more 

closely reflects the Commission’s 

statement of policy and that it not be a 

guidance document or procedure which 

discusses every specific implementation 

aspect of enforcement. Therefore, some 

of the information in the current policy, 

which more closely resembles 

procedural guidance rather than 

Commission policy, has been either 

reworded, deleted, or moved to a 

guidance document, e.g., the NRC 

Enforcement Manual. One example of 

such a deletion is found in Section III, 

Responsibilities, of the current Policy. 

Specifically, information regarding 

delegation of authority was removed 

because delegation of authority is 

actually addressed in internal NRC 

memorandums. Another example is 

found in Section V, Predecisional 

Enforcement Conferences (PECs), of the 

current policy. In particular, the 

implementation guidance in the current 

policy regarding conduct of PECs is 

being relocated to the Enforcement 

Manual. As a final example, most of the 

discussion regarding how the civil 

penalty assessment process is 

implemented will be relocated to the 

Enforcement Manual. 

The revised Enforcement Policy also 

includes a proposed revision to a 

previous Federal Register notice, ‘‘Base 

Civil Penalties for Loss, Abandonment, 

or Improper Transfer or Disposal of 

Sources; Policy Statement,’’ published 

December 18, 2000 (65 FR 79139). 

The Commission is aware that 

enforcement actions deliver regulatory 

messages. Based on this tenet, the goals 

of this revision are to ensure that the 

Enforcement Policy: (1) Continues to 

reflect the Commission’s focus on 

safety, e.g., the need for licensees to 

identify and correct violations, to 

address root causes, and to be 

responsive to initial opportunities to 

identify and prevent violations; (2) 

appropriately addresses the various 

subject areas that the NRC regulates; and 

(3) provides a framework that supports 

consistent implementation, recognizing 

that each enforcement action is 

dependent on the specific 

circumstances of the case. 

The following draft Table of Contents 

is consistent with the approach 

described above: 

PREFACE 

1.0 INTRODUCTION 

1.1 Purpose of the Enforcement Policy 

1.2 Applicability of the Enforcement 

Policy 

1.3 Statutory Authority 

1.4 Regulatory Framework 

1.5 Adequate Protection Standard 

2.0 NRC ENFORCEMENT PROCESS 

2.1 Identification of Violations 

2.2 Assessment of Violations 

2.2.1 Factors Affecting Assessment of 

Violations 

2.2.2 Severity Levels 

2.2.3 Significance Determination Process 

2.2.3.1 Exceptions to the Use of the SDP 

2.3 Disposition of Violations 

2.3.1 Minor Violations 

2.3.2 More than Minor Violations 

2.3.3 Reopening Closed Enforcement 

Actions 

2.3.4 Enforcement Guidance 

Memorandum 

2.3.5 Commission Notification and 

Consultation 

2.4 Participation in the Enforcement 

Process 

2.4.1 Predecisional Enforcement 

Conference 

2.4.2 Regulatory Conference 

2.4.3 Alternative Dispute Resolution 

3.0 USE OF ENFORCEMENT DISCRETION 

3.1 Violations Identified During Extended 

Shutdowns or Work Stoppages 

3.2 Violations Involving Old Design 

Issues 

3.3 Violations Indentified Due to 

Previous Enforcement Actions 

3.4 Violations Involving Certain 

Discrimination Issues 

3.5 Violations Involving Special 

Circumstances 

3.6 Use of Discretion in Determining the 

Amount of a Civil Penalty 

3.7 Exercise of Discretion to Issue Orders 

3.8 Notices of Enforcement Discretion 

(NOED) for Reactor Licensees 

3.9 Enforcement Discretion for Certain 

Fire Protection Issues (10 CFR 50.48) 

4.0 ENFORCEMENT ACTIONS AGAINST 

INDIVIDUALS 

4.1 Circumstances When Enforcement 

Action Against an Individual May Be 

Taken 

4.2 NOVs and Orders to Individuals 

4.2.1 Licensed Individuals 

4.2.2 Non-Licensed Individuals 

4.3 Civil Penalties to Individuals 

4.4 Confirmatory Orders to Individuals 

5.0 PUBLIC AVAILABILITY OF 

INFORMATION REGARDING 

ENFORCEMENT ACTIONS 

6.0 SUPPLEMENTS—VIOLATION 

EXAMPLES 

6.1 Reactor Operations 

6.2 Facility Construction 

6.3 Information Security 

6.4 Health Physics 

6.5 Transportation 

6.6 Materials Operations 

6.7 Inaccurate and Incomplete 

Information and Reporting 

6.8 Emergency Preparedness 

6.9 Fuel Cycle Operations 

6.10 Licensed Operator 

6.11 Reactor and Fuel Facility Security 

6.12 Discrimination 

6.13 Materials Security 

7.0 GLOSSARY OF TERMS 

8.0 TABLE OF BASE CIVIL PENALTIES 

III. Proposed Revisions to Table of Base 

Civil Penalties 

Yucca Mountain High Level Waste 

Repository 

Congress enacted the Nuclear Waste 

Policy Act of 1987 (NWPA) for the 

purpose of establishing a 

comprehensive national program for the 

safe, permanent disposal of high level 

waste (HLW). The NWPA directed the 

Department of Energy (DOE) to study 

suitable sites for a deep, underground 

repository. In 1987, Congress amended 

the NWPA and directed the DOE to 

study only one site, Yucca Mountain, as 

a potential repository. 

The Atomic Energy Act of 1954, as 

amended (AEA), the Energy 

Reorganization Act of 1974, as amended 

(ERA), and NWPA, as amended, 

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53288 Federal Register / Vol. 73, No. 179 / Monday, September 15, 2008 / Notices 

authorize the NRC to regulate the siting, 

development, construction, and 

operation of the Yucca Mountain 

repository. 

The NRC’s authority to regulate the 

DOE’s receipt and possession of source, 

special nuclear, and byproduct material 

at Yucca Mountain has been 

implemented through 10 CFR Part 63, 

Disposal of High-Level Radioactive 

Wastes in a Proposed Geologic 

Repository at Yucca Mountain, Nevada. 

The NRC’s enforcement authority is 

set forth in the AEA and the ERA. This 

statutory authority is implemented 

through Subpart B of 10 CFR Part 2, 

which contains the procedures the NRC 

uses in exercising its enforcement 

authority, primarily Notices of Violation 

(NOVs), Civil Penalties, and Orders. 

Violations are subject to civil 

enforcement action and may also be 

subject to criminal prosecution. 

Regulatory requirements have varying 

degrees of safety, security, or 

environmental significance. For that 

reason, the NRC imposes various base 

civil penalties depending on the specific 

circumstances. The base civil penalties 

for various reactor, fuel cycle, materials, 

and vendor programs are set forth in 

this revised Enforcement Policy, Section 

8, Tables A and B. 

The NRC uses a graded approach in 

assessing civil penalties based on the 

severity level of the violation and the 

class of licensee, vendor, or other 

person. Base civil penalties generally 

take into account the significance of a 

violation as the primary consideration, 

while the licensee’s ability to pay is a 

secondary consideration. The NRC 

reviews each proposed civil penalty on 

its own merits and, after considering all 

relevant circumstances, may adjust the 

base civil penalties in Table A for 

Severity Level I, II, and III violations as 

reflected in Table B of the Enforcement 

Policy, i.e., 100 percent for Severity 

Level I violations, 80% for Severity 

Level II violations, and 50 percent for 

Severity Level III violations. However, 

in no instance would a civil penalty for 

any one violation exceed the current 

statutory limit of $130,000 per day per 

violation. 

The most viable enforcement option 

available to the NRC, in addition to 

NOVs and orders, is the imposition of 

civil penalties. Currently there are no 

provisions in Table A of the 

Enforcement Policy that address DOE as 

a licensee. Therefore, the NRC is 

revising Table A of the Policy to ensure 

that, if the need arises, the NRC has the 

appropriate tools to take enforcement 

actions as prescribed in Subpart J, 

Violations, of 10 CFR Part 63, during the 

application phase. DOE submitted its 

construction license application for 

Yucca Mountain for review on June 3, 

2008. The NRC acknowledged receipt of 

the application on June 10, 2008, at 

which time DOE became an NRC license 

applicant. 

Based on the potential nuclear 

material inventory involved, i.e., at least 

70 million metric tons of HLW, the 

corresponding safety consequences that 

could arise at the site, specifically to 

occupational employees, and the DOE’s 

ability to pay, the staff recommends the 

statutorily allowed maximum base civil 

penalty of $130,000 per day for a 

Severity Level I violation. In 

determining the base civil penalty that 

should be applied to the Yucca 

Mountain repository, the staff also 

considered the fact that when 10 CFR 

Part 63 was developed, the licensing 

criteria used in that part was 

comparable to the criteria applied to 

reactors and spent fuel facilities. The 

staff also recommends that this 

information be included in Table A 

under a generic heading, i.e., ‘‘Yucca 

Mountain High Level Waste 

Repository,’’ to address the possibility 

of any future engineered underground 

disposal facilities used for the storage of 

HLW. 

Because the DOE’s activities during 

the construction application would, 

most likely, lack direct safety 

consequences to the public health and 

safety (i.e., waste will not have been 

transferred to the site during the first 

phase), it is likely that many of the 

violations during this phase could be 

either cited or non-cited Severity Level 

IV violations. In addition, the staff 

expects that escalated enforcement 

actions during the application review 

would seldom exceed a Severity Level 

III. While the staff has the option to 

mitigate or escalate a violation and/or 

monetary sanctions based on the 

circumstances surrounding a violation, 

the staff believes that few, if any, of 

these violations would escalate to a 

Severity Level I or II. 

Gas Centrifuge Uranium Enrichment 

Facilities 

The current Enforcement Policy does 

not provide a base civil penalty for 

enforcement actions at gas centrifuge 

uranium enrichment facilities. For that 

reason, if a violation of NRC 

requirements were to occur with a 

proposed civil penalty at this type of 

facility, the staff would assess the civil 

penalty utilizing the agency’s 

philosophy as articulated in the 

Enforcement Policy, i.e., the civil 

penalty would be based on the 

circumstances of the case, the type of 

licensee involved, and the ability of the 

licensee to pay the civil penalty. 

Currently, NRC staff is performing 

licensing reviews of two gas centrifuge 

uranium enrichment facilities with 

enrichment levels of 5 weight percent 

uranium-235 (U235) in one case and 10 

weight percent U235 in the other. 

Therefore, it is appropriate to provide 

enforcement guidance for this type of 

facility at this time. 

In developing a base civil penalty for 

gas centrifuge uranium enrichment 

facilities, NRC compared the 

radiological, chemical, and security 

hazards with both the Gaseous Diffusion 

Plants (GDPs) and Category III fuel 

fabricators and, through an overall 

comparison, provide an appropriate 

base civil penalty. 

To determine the appropriate base 

civil penalty for gas centrifuge uranium 

enrichment facilities, the staff first 

compared the potential impact of 

noncompliance on public health and 

safety and the common defense and 

security with GDPs because both are 

enrichment facilities utilizing the same 

kinds of materials and, in addition, both 

have security implications associated 

with their operation. This comparison 

indicates that the radiological and 

chemical hazards at gas centrifuge 

uranium enrichment facilities are 

substantially less than these hazards at 

GDPs based on the significantly lower 

quantities of liquid and gaseous 

uranium hexafluoride (UF6) in the 

process systems and the significantly 

lower potential for releases of large 

quantities of UF6. 

Gaseous diffusion cascades operate at 

pressures that are sub-atmospheric to 

just above atmospheric pressure. In 

addition, the current GDP utilizes feed, 

product withdrawal, and tails 

withdrawal systems that handle large 

quantities of pressurized liquid UF6. 

This results in the potential for releases 

of large quantities of UF6. Since the GDP 

withdrawal stations involve the 

handling and lifting of up to 14-ton 

cylinders of liquid UF6, there is a 

significant potential for severe 

consequences in the event that proper 

plant procedures are not followed. GDPs 

have high criticality hazards due to the 

large size (unsafe geometry) of cascade 

system piping and components, the 

large UF6 inventories processed, and the 

potential for accumulation of critical 

masses of UF6 within these system 

piping and components. GDPs also 

handle large amounts of flammable 

material such as lubricating oil and 

chemically hazardous material other 

than UF6 such as chorine triflouride 

(CIF3), fluorine (F2), and chorine (CI2). 

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Federal Register / Vol. 73, No. 179 / Monday, September 15, 2008 / Notices 53289 

The radiological and chemical 

hazards at gas centrifuge uranium 

enrichment facilities are, by comparison 

to the GDPs, substantially reduced. 

Individual centrifuges and cascades 

contain much smaller quantities of 

gaseous UF6. Although UF6 is liquefied 

in the sampling and transfer systems, 

the cylinders containing liquid UF6 are 

not moved. Centrifuge enrichment 

cascades operate at near-vacuum 

conditions, minimizing the potential for 

UF6 releases. These plant designs 

substantially reduce the radiological 

and chemical hazards associated with 

releases of radioactive and hazardous 

chemicals in comparison to gaseous 

diffusion plants. Because of the small 

quantities of UF6 in the cascades, a gas 

centrifuge uranium enrichment facility, 

limiting its enrichments to less than 20 

percent of U235 (special nuclear material 

of low strategic significance, therefore, a 

Category III fuel fabricator), will also 

have substantially reduced criticality 

hazards relative to a GDP. 

The staff also considered the security 

implications associated with the 

operation of gas centrifuge uranium 

enrichment facilities as compared to the 

operation of GDPs and to Category III 

fuel fabricators. That comparison 

indicates that the security measures 

necessary to handle information at a gas 

centrifuge facility is more similar to the 

GDPs as both types of facilities handle 

classified information up to Secret 

Restricted Data and utilize classified 

components. Both types of facilities are 

also required to have comparable 

materials control and accounting 

programs and physical security 

programs, and both types of facilities are 

expected to have programs for 

protection against potential terrorist 

activities. 

However, as the following comparison 

indicates, the overall radiological, 

criticality, and chemical security 

implications for gas centrifuge uranium 

enrichment facilities are more 

comparable to that of Category III fuel 

fabricators. First, both gas centrifuge 

uranium enrichment plants and 

Category III fuel fabricators have 

Category III Special Nuclear Material, 

that is, these facilities are limited to 

enrichments of less than 20 percent of 

U235 (special nuclear material of low 

strategic significance). In addition, the 

radiological and chemical risks of gas 

centrifuge uranium enrichment facilities 

are more similar to, and in fact even 

lower than, Category III fuel fabricators 

due to the fact that fuel fabricators 

operate with the greater quantities of 

licensed material in process 

components and at higher pressures 

than gas centrifuge plants. Therefore, 

the necessary physical protection 

requirements (based on the category of 

facility) for a gas centrifuge facility are 

similar to those required for Category III 

fuel fabricators. 

The comparison of the security 

implications at gas centrifuge uranium 

enrichment and Category III fuel 

fabrication facilities indicates that: 

1. Security of classified information 

and components: The security of 

classified information and components 

at gas centrifuge facilities will require 

higher levels of protection than Category 

III fuel fabricators because classified 

information and components are not 

used at Category III fuel fabricators. 

However, Category III fuel fabricators 

have and are required to yprotect 

Safeguards Information. 

2. Prevention of unauthorized 

production or diversion of special 

nuclear material: The prevention of 

unauthorized production or diversion of 

special nuclear material would require 

gas centrifuge enrichment facilities to 

have materials accounting and control 

programs similar to those at the GDPs or 

Category I fuel fabrication facilities. 

Category III fuel fabricators also have 

materials accounting and control 

programs, although the implications of 

unauthorized production and diversion 

of special nuclear material would be 

less significant than a gas centrifuge 

uranium enrichment plant. 

3. Protection of special nuclear 

material: Due to the possession of 

special nuclear material of low strategic 

significance at both types of facilities, 

gas centrifuge enrichment facility 

physical protection requirements for 

special nuclear material and protection 

requirements against terrorists are 

similar to Category III fuel fabricators. 

4. Protection against potential terrorist 

activities: Due to the possession of 

special nuclear material of low strategic 

significance at both types of facilities, 

gas centrifuge enrichment facility 

physical protection requirements 

against terrorists are expected to be 

similar to Category III fuel fabricators. 

In conclusion, the comparison of the 

radiological, criticality, and chemical 

risks of gas centrifuge uranium 

enrichment facilities to GDPs and 

Category III fuel fabricators indicates 

that these risks are lower than the same 

risks at GDPs and are lower than the 

risks at Category III fuel fabricators. In 

addition, two of the four security risk 

areas at gas centrifuge uranium 

enrichment facilities are more 

comparable to Category III fuel 

fabricators. Finally, the physical 

protection and terrorist security risks 

are substantially less significant for gas 

centrifuge uranium enrichment facilities 

than at GDPs, when examined in the 

context of the radiological and chemical 

risks at gas centrifuge uranium 

enrichment facilities. Therefore, after 

considering both safety and security at 

gas centrifuge uranium enrichment 

facilities in terms of their nuclear 

material inventories and potential for 

consequences to the public and workers, 

the staff has concluded that gas 

centrifuge uranium enrichment facilities 

are more similar to Category III fuel 

fabricators than to GDPs. For that reason 

the staff believes that the base civil 

penalty for Severity Level I violations at 

gas centrifuge uranium enrichment 

facilities in Table A should be 

established at $32,500, the amount 

already established for Category III fuel 

fabricators. 

The Enforcement Policy is also being 

modified to clarify that the fuel 

fabricators in ‘‘c’’ of Table A refer to 

Category III fuel fabricators. 

Uranium Conversion Facilities 

The staff proposes to raise the base 

penalty for enforcement activities 

associated with uranium conversion 

facilities to a base civil penalty of 

$32,500 from the current base civil 

penalty of $13,000. 

Currently, the only operating 

conversion plant in the United States is 

the Honeywell facility located in 

Metropolis, IL. Honeywell chemically 

processes the uranium source materials 

from triuranium octoxide (U3O8) to UF6

prior to shipping the product to 

enrichment plants. The three main bulk 

chemicals used at Honeywell are 

ammonia (NH3, the source of hydrogen), 

anhydrous hydrofluoric acid (HF), and 

flourine (F2). Each is a highly hazardous 

chemical. Release of bulk quantities of 

UF6, NH3, HF, or F2 could have off-site 

consequences due the hazardous nature 

of the chemicals. NH3, HF, and F2 are 

regulated under the Occupational Safety 

and Health Administration (OSHA) 

Process Safety Management Rule, 19 

CFR 1910.119. The NRC only regulates 

those chemicals when they come in 

contact with licensed material, evolve 

from licensed material, as in HF from 

the UF6/water reaction, or adversely 

impact the safe handling of licensed 

material. 

Uranium conversion facilities such as 

Honeywell are licensed under the 

requirements of 10 CFR Part 40, 

Domestic Licensing of Source Material. 

Uranium source material is shipped 

from uranium mills as ‘‘yellow cake’’ in 

plastic-lined drums. In addition to 

U3O8, yellowcake contains 

contaminants, including radioactive 

decay daughter products and various 

rare earth and other metals. The 

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53290 Federal Register / Vol. 73, No. 179 / Monday, September 15, 2008 / Notices 

yellowcake contains natural uranium, 

which has only 0.711 percent (U235). 

Hence, a criticality accident is not 

possible at a conversion facility. The 

greatest radiation exposure rates come 

from processes that concentrate the 

radioactive decay daughter products in 

waste streams. Soluble forms of 

uranium present the greatest health risk 

from source material at conversion 

facilities. The health risk is due to the 

toxic nature of uranium, which is 

similar to other heavy metals. The 

radioactive risk is small. 

Specifically, the chemical and 

radiological hazards associated with 

uranium conversion facilities are as 

follows: 

Chemical Hazards—Uranium is 

handled in many different chemical 

forms in UF6 conversion plants, but UF6

is the only chemical form of uranium 

that can be readily dispersed off-site. 

UF6 will react with water to form HF 

and uranium difluorodioxo (UO2F2). 

Because airborne moisture is generally 

available, the reaction can be expected 

to occur if UF6 is released to the 

atmosphere. Both the HF and the UO2F2

produced at a uranium conversion plant 

are hazardous chemicals. HF is a 

corrosive acid vapor that can severely 

harm the lungs and exposed portions of 

the body. UO2F2, formed as particulate 

material, produces radioactive and 

chemical effects when taken into the 

body, and its chemical effect is the most 

important because much of the uranium 

is present in soluble form. UF6 in the 

liquid form is the most hazardous. 

The Honeywell facility produces UF6

by fluorination of UF4. The UF6, which 

is produced in a gaseous state, is 

collected in cold traps, where it is 

solidified by refrigerant cooling. 

Subsequent heating of the cold traps 

liquefies the UF6 for transfer to 

cylinders, where the UF6 cools to 

ambient temperature and again 

solidifies. The cold traps and the 

cylinders represent the largest 

accumulation of heated UF6 and 

therefore pose the greatest risk of a 

significant release of UF6. The filled 

cylinders represent the greater risk 

because of their temporary use in the 

process, the large numbers of individual 

cylinders utilized, their typically larger 

inventories of UF6, and their routine 

movement within the facilities before 

solidification. While the filled cylinders 

are considered to be the greater risk, 

these risks are also applicable to filled 

cold traps. 

Radiological Hazards—Chemical 

conversion processes tend to 

concentrate uranium decay products in 

the waste streams. Alpha particles 

resulting from the primary 

disintegration of uranium present no 

external radiation problem because they 

do not penetrate the skin. However, the 

uranium decay products include 

isotopes that emit mildly penetrating 

beta rays and highly penetrating gamma 

rays. Beta radiation levels as high as 200 

mrad/hr may be found at the surface of 

UF6. When UF6 is vaporized from a 

cylinder, the decay products usually 

remain behind. Thus, the internal 

surface of an empty cylinder may have 

beta radiation levels up to several rad/ 

hr. Similarly, the gamma radiation from 

an empty cylinder will be much higher 

than from a filled cylinder and may 

range up to 200 mrad/hr. 

The chemical characteristics of these 

contaminants will cause significant 

exposure levels of beta and gamma 

radiation from the uranium decay 

product activity in certain sections of 

the process. The risk of radiation 

exposure increases during maintenance 

of process equipment, transfer of 

product, and handling of UF6 cylinders. 

In raising the base civil penalty for 

uranium conversion facilities, the staff 

has analyzed the associated radiological, 

chemical, and security hazards with that 

of Gaseous Diffusion Plants (GDPs), 

Category III fuel fabricators, and test 

reactors and industrial radiographers. 

Currently, uranium conversion facilities 

are in the same base civil penalty 

category as test reactors and industrial 

radiographers with the base penalty 

amount of $13,000. 

To determine the appropriate base 

civil penalty for uranium conversion 

facilities, the staff first compared the 

potential impact of noncompliance on 

public health and safety and the 

common defense and security with 

Gaseous Diffusion Plants (GDPs). 

Gaseous diffusion cascades operate at 

pressures that are sub-atmospheric to 

just above atmospheric pressure. In 

addition, the current GDP utilizes feed, 

product withdrawal, and tails 

withdrawal systems that handle large 

quantities of pressurized liquid UF6. 

This results in the potential for releases 

of large quantities of UF6. Since the GDP 

withdrawal stations involve the 

handling and lifting of up to 14-ton 

cylinders of liquid UF6, there is a 

significant potential for severe 

consequences in the event that proper 

plant procedures are not followed. GDPs 

have high criticality hazards due to the 

large size (unsafe geometry) of cascade 

system piping and components, the 

large UF6 inventories processed, and the 

potential for accumulation of critical 

masses of UF6 within these system 

piping and components. GDPs also 

handle large amounts of flammable 

material such as lubricating oil and 

chemically hazardous material other 

than UF6 such as CIF3, F2, and CI2. 

The radiological and chemical 

hazards at uranium conversion facilities 

are similar in comparison to the GDPs. 

At a uranium conversion facility such as 

Honeywell, all UF6 filled cylinders 

when initially filled must be allowed to 

cool for 5 days to ensure that all UF6 has 

solidified. The UF6 solidifies and 

volume drops from about 95 percent to 

about 60 percent full. Only ‘‘solid’’ 

cylinders are allowed to be shipped offsite. UF6 is in solid form under ambient 

temperature and pressure conditions. 

Any cylinder breach with UF6 in the 

solid form will have a limited release. 

Uranium conversion facilities are 

designed to process natural uranium, 

thus, there is no criticality concerns like 

there are at GDPs. However, the only 

major risk factor that a conversion 

facility does not have that is present at 

a GDP is the criticality risk. 

The staff also considered the security 

implications associated with the 

operation of uranium conversion 

facilities as compared to the operation 

of GDPs and to Category III fuel 

fabricators. That comparison indicates 

that the security measures necessary at 

a uranium conversion facility are 

similar to that of a Category III fuel 

fabricators and GDPs. However, because 

of the large number of potential 

chemical hazards and certain 

radiological hazards, protection against 

potential terrorist activities is required 

to protect worker and public health and 

safety. 

In comparison, the overall 

radiological and chemical hazards 

implications for uranium conversion 

facilities are much more significant than 

those of test reactors and industrial 

radiographer, but just somewhat less 

than that of GDPs. As delineated in the 

NRC Enforcement Policy, operations 

involving greater nuclear material 

inventories and greater potential 

consequences to the public and licensee 

employees receive higher civil 

penalties. For the reasons stated above 

the staff believes that the base civil 

penalty for violations at uranium 

conversion facilities in Table A should 

be established at $32,500, the same 

amount established for Category III fuel 

fabricators. 

IV. Deletion of Interim Enforcement 

Policies 

The following interim enforcement 

policies located in the current 

Enforcement Policy have either been 

deleted from the revised Policy, for the 

reasons stated below, or relocated into 

the revised Enforcement Policy. 

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Federal Register / Vol. 73, No. 179 / Monday, September 15, 2008 / Notices 53291 

Interim Enforcement Policy for 

Generally Licensed Devices Containing 

Byproduct Material (10 CFR 31.5) 

This interim policy addressed 

violations that persons licensed 

pursuant to 10 CFR 31.5 discovered and 

reported before, as well as during, the 

initial cycle of a notice and response 

program related to the revision of 10 

CFR 31.5. This interim policy was 

expected to remain in effect through 

completion of one cycle of the licensee 

notice and response program. Since one 

cycle is complete, this interim policy is 

no longer in effect. 

Interim Enforcement Policy Regarding 

Enforcement Discretion for Certain 

Fitness-for-Duty Issues (10 CFR Part 26) 

10 CFR Part 26, Fitness for Duty 

Programs, has been amended. The final 

rule became effective on April 30, 2008 

(73 FR 16966). The amended rule 

addressed the issues covered by the 

interim enforcement discretion policy. 

Therefore, this interim policy has been 

deleted from the revised Enforcement 

Policy. 

Interim Enforcement Policy Regarding 

the Use of Alternative Dispute 

Resolution 

This interim policy addressed the use 

of a pilot program for testing the use of 

Alternative Dispute Resolution (ADR) in 

the enforcement program. On May 5, 

2006, in SECY–06–0102, ‘‘Evaluation of 

the Pilot Program on the Use of 

Alternative Dispute Resolution in the 

Allegation and Enforcement Program’’, 

the staff provided the Commission with 

the results of the evaluation of the ADR 

pilot program. The Office of 

Enforcement concluded that the 

program was successful and the staff 

intends to continue using the ADR 

program for discrimination and other 

wrongdoing cases. The ADR program 

has been incorporated into the revised 

Enforcement Policy. 

Interim Enforcement Policy Regarding 

Enforcement Discretion for Certain Fire 

Protection Issues (10 CFR 50.48) 

This interim policy was moved in its 

entirety into section 3.9 of the revised 

Enforcement Policy. 

V. Procedural Requirements 

Paperwork Reduction Act 

This policy statement does not 

contain new or amended information 

collection requirements subject to the 

Paperwork Reduction Act of 1995 (44 

U.S.C. 3501 et seq.) Existing 

requirements were approved by the 

Office of Management and Budget 

(OMB), approval number 3150–0136. 

Public Protection Notification 

The NRC may not conduct or sponsor, 

and a person is not required to respond 

to, a request for information or an 

information collection requirement 

unless the requesting document 

displays a currently valid OMB control 

number. 

Small Business Regulatory Enforcement 

Fairness Act 

In accordance with the Small 

Business Regulatory Enforcement 

Fairness Act of 1996, the NRC has 

determined that this action is not a 

’’major’’ rule and has verified this 

determination with the Office of 

Information and Regulatory Affairs, 

Office of Management and Budget. 

Dated at Rockville, MD, this 9th day of 

September 2008. 

For the Nuclear Regulatory Commission. 

Cynthia A. Carpenter, 

Director, Office of Enforcement. 

[FR Doc. E8–21433 Filed 9–12–08; 8:45 am] 

BILLING CODE 7590–01–P 

NUCLEAR REGULATORY 

COMMISSION 

[IA–08–014] 

In the Matter of Joseph S. Shepherd; 

Order Prohibiting Involvement in 10 

CFR Part 71 Activities and 

Conditioning Other NRC Licensed 

Activities (Effective Immediately) 

I 

Joseph S. Shepherd was a contractor 

to Source Production and Equipment 

Company, Inc. (SPEC), of St. Rose, 

Louisiana. SPEC was a registered user of 

a U.S. Nuclear Regulatory Commission 

(NRC or Commission) Model No. 5979 

Shipping Package (Certificate of 

Compliance (CoC) No. 5979, Revision 

10), and an NRC-approved Quality 

Assurance (QA) Program Approval 

holder (NRC Docket Number 71–0102) 

pursuant to Part 71 of Title 10 of the 

Code of Federal Regulations (10 CFR). 

The CoC authorized use of the Model 

No. 5979 package under the general 

license provisions of 10 CFR 71.12 

[currently 10 CFR 71.17]. The QA 

Program Approval satisfied the 

requirements of 10 CFR 71.12(b) 

[currently 10 CFR 71.17(b)], and 10 CFR 

71.101(c) [currently 10 CFR 

71.101(c)(1)] by authorizing activities to 

be conducted under criteria of Subpart 

H of 10 CFR Part 71, ‘‘Quality 

Assurance.’’ SPEC also was an NRC 

export licensee pursuant to 10 CFR Part 

110. SPEC hired Mr. Shepherd to 

perform certain maintenance 

inspections required by the NRC CoC for 

the Model No. 5979 shipping cask prior 

to making shipments of NRC licensed 

radioactive material to Mexico. 

II 

During an NRC inspection conducted 

on November 18, 2004, at Alpha-Omega 

Services, Inc. (AOS), an NRC certificate 

holder and Quality Assurance (QA) 

program holder, certain 

nonconformances regarding a shipping 

package, serial number 1B, CoC No. 

5979, Model No. 5979, were brought to 

the NRC’s attention. The end-caps of the 

shipping package did not conform to the 

physical (weight and materials) and 

dimensional (end cap thickness and 

length of the bolts) configuration 

specified by the CoC. In addition, holes 

had been drilled in the turret of the 

shipping package. Foss Therapy 

Services (FTS) had purchased the 

shipping package from AOS in 2001. 

FTS holds a State of California 

radioactive materials license and 

coordinates source exchanges and 

recycling for radiation therapy systems 

at various hospitals. FTS, however, is 

not an NRC licensee, authorized user, or 

certificate or QA program holder. AOS 

happened to be performing its annual 

inspection of the Model No. 5979 

package when NRC conducted its 

November 18, 2004, inspection at AOS. 

The NRC also became aware during 

its November 18, 2004, inspection at 

AOS that FTS had been using SPEC, to 

ship byproduct material for FTS to 

Mexico. The NRC obtained shipping 

documents which confirmed that SPEC 

had used the nonconforming container 

between June 25, 2001, and May 20, 

2004, to make export shipments to 

Mexico. SPEC hired Mr. Shepherd, an 

officer and co-owner of FTS, to perform 

inspections of the Model No. 5979 

shipping package prior to three export 

shipments by SPEC on July 15, 2003, 

December 4, 2003, and May 20, 2004. 

As a result of the NRC’s November 18, 

2004, inspection, the NRC’s Office of 

Investigations (OI) initiated an 

investigation to determine whether 

SPEC had willfully violated NRC 

regulations relating to its export 

shipments to Mexico. 

Based on the OI investigation, the 

NRC has concluded that Mr. Shepherd 

engaged in three examples of deliberate 

misconduct in violation of 10 CFR 

110.7b, ‘‘Deliberate Misconduct.’’ 

First, on or about July 15, 2003, and 

December 4, 2003, and in violation of 10 

CFR 110.7b(a)(2), Mr. Shepherd 

deliberately provided materially 

inaccurate information to SPEC in two 

checklists and in shipping papers 

concerning inspections of the Model No. 

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