[House Hearing, 106 Congress]
[From the U.S. Government Publishing Office]



 
 LEGISLATION TO IMPROVE SAFETY AND SECURITY IN THE DEPARTMENT OF ENERGY

=======================================================================

                                HEARING

                               before the

                    SUBCOMMITTEE ON ENERGY AND POWER

                                 of the

                         COMMITTEE ON COMMERCE
                        HOUSE OF REPRESENTATIVES

                       ONE HUNDRED SIXTH CONGRESS

                             SECOND SESSION

                               __________

                             MARCH 22, 2000

                               __________

                           Serial No. 106-126

                               __________

            Printed for the use of the Committee on Commerce


                    U.S. GOVERNMENT PRINTING OFFICE
64-031CC                    WASHINGTON : 2000



                         COMMITTEE ON COMMERCE

                     TOM BLILEY, Virginia, Chairman

W.J. ``BILLY'' TAUZIN, Louisiana     JOHN D. DINGELL, Michigan
MICHAEL G. OXLEY, Ohio               HENRY A. WAXMAN, California
MICHAEL BILIRAKIS, Florida           EDWARD J. MARKEY, Massachusetts
JOE BARTON, Texas                    RALPH M. HALL, Texas
FRED UPTON, Michigan                 RICK BOUCHER, Virginia
CLIFF STEARNS, Florida               EDOLPHUS TOWNS, New York
PAUL E. GILLMOR, Ohio                FRANK PALLONE, Jr., New Jersey
  Vice Chairman                      SHERROD BROWN, Ohio
JAMES C. GREENWOOD, Pennsylvania     BART GORDON, Tennessee
CHRISTOPHER COX, California          PETER DEUTSCH, Florida
NATHAN DEAL, Georgia                 BOBBY L. RUSH, Illinois
STEVE LARGENT, Oklahoma              ANNA G. ESHOO, California
RICHARD BURR, North Carolina         RON KLINK, Pennsylvania
BRIAN P. BILBRAY, California         BART STUPAK, Michigan
ED WHITFIELD, Kentucky               ELIOT L. ENGEL, New York
GREG GANSKE, Iowa                    TOM SAWYER, Ohio
CHARLIE NORWOOD, Georgia             ALBERT R. WYNN, Maryland
TOM A. COBURN, Oklahoma              GENE GREEN, Texas
RICK LAZIO, New York                 KAREN McCARTHY, Missouri
BARBARA CUBIN, Wyoming               TED STRICKLAND, Ohio
JAMES E. ROGAN, California           DIANA DeGETTE, Colorado
JOHN SHIMKUS, Illinois               THOMAS M. BARRETT, Wisconsin
                                     BILL LUTHER, Minnesota
                                     LOIS CAPPS, California

                   James E. Derderian, Chief of Staff

                   James D. Barnette, General Counsel

      Reid P.F. Stuntz, Minority Staff Director and Chief Counsel

                                 ______

                    Subcommittee on Energy and Power

                      JOE BARTON, Texas, Chairman

MICHAEL BILIRAKIS, Florida           RICK BOUCHER, Virginia
CLIFF STEARNS, Florida               KAREN McCARTHY, Missouri
  Vice Chairman                      TOM SAWYER, Ohio
STEVE LARGENT, Oklahoma              EDWARD J. MARKEY, Massachusetts
RICHARD BURR, North Carolina         RALPH M. HALL, Texas
ED WHITFIELD, Kentucky               FRANK PALLONE, Jr., New Jersey
CHARLIE NORWOOD, Georgia             SHERROD BROWN, Ohio
TOM A. COBURN, Oklahoma              BART GORDON, Tennessee
JAMES E. ROGAN, California           BOBBY L. RUSH, Illinois
JOHN SHIMKUS, Illinois               ALBERT R. WYNN, Maryland
HEATHER WILSON, New Mexico           TED STRICKLAND, Ohio
JOHN B. SHADEGG, Arizona             PETER DEUTSCH, Florida
CHARLES W. ``CHIP'' PICKERING,       RON KLINK, Pennsylvania
Mississippi                          JOHN D. DINGELL, Michigan,
VITO FOSSELLA, New York                (Ex Officio)
ED BRYANT, Tennessee
ROBERT L. EHRLICH, Jr., Maryland
TOM BLILEY, Virginia,
  (Ex Officio)

                                  (ii)



                            C O N T E N T S

                               __________
                                                                   Page

Testimony of:
    Adelman, David E., Project Attorney, Nuclear Program, Natural 
      Resources Defense Council..................................    69
    Conway, Hon. John T., Chairman, Defense Nuclear Facilities 
      Safety Board...............................................    24
    Eldredge, Maureen, Program Director, Alliance for Nuclear 
      Accountability.............................................    58
    Jones, Gary L., Associate Director, Energy, Resources, and 
      Science Issues, General Accounting Office..................    45
    Mande, Hon. Jerold R., Deputy Assistant Secretary for Labor, 
      Occupational Safety and Health Administration..............    18
    Meserve, Hon. Richard A., Chairman; accompanied by Hon. Greta 
      Joy Dicus, Commissioner; Hon. Nils J. Diaz, Commissioner; 
      Hon. Edward McGaffigan, Jr., Commissioner; Hon. Jeffrey S. 
      Merrifield, Commissioner, Nuclear Regulatory Commission....    16
    Shank, Charles V., Director, Lawrence Berkeley National 
      Laboratory.................................................    51
    Sullivan, Mary Anne, General Counsel, U.S. Department of 
      Energy.....................................................     6
    Van Ness, Robert L., Assistant Vice President for Laboratory 
      Administration, University of California...................    55
Material submitted for the record by:
    Miller, Richard, Policy Analyst, Paper, Allied-Industrial, 
      Chemical & Energy Workers Union, prepared statement of.....   162

                                 (iii)




 LEGISLATION TO IMPROVE SAFETY AND SECURITY IN THE DEPARTMENT OF ENERGY

                              ----------                              


                       WEDNESDAY, MARCH 22, 2000

                  House of Representatives,
                             Committee on Commerce,
                          Subcommittee on Energy and Power,
                                                    Washington, DC.
    The subcommittee met, pursuant to notice, at 10:30 a.m., in 
room 2322, Rayburn House Office Building, Hon. Joe Barton, 
(chairman) presiding.
    Members present: Representatives Barton, Bilirakis, 
Stearns, Largent, Whitfield, Rogan, Shimkus, Wilson, Bryant, 
Ehrlich, McCarthy, Sawyer, Boucher, Wynn, and Strickland.
    Staff present: Kevin Cook, science advisor; Elizabeth 
Brennan, legislative clerk; Tom DiLenge, majority counsel; and 
Edith Holleman, minority counsel.
    Mr. Barton. The Subcommittee of Energy and Power of the 
Commerce Committee, hearing on legislation to improve the 
safety and security of the Department of Energy will come to 
order.
    The purpose of today's hearing is to consider legislation 
to improve safety and security in the Department of Energy. The 
three bills before us would provide a financial incentive for 
the Department of Energy's nonprofit contractors to take safety 
more seriously; would strengthen the Department's internal 
oversight of security, and would bring about external 
regulation of nuclear safety and worker safety.
    I introduced the first of these three bills, H.R. 3833, to 
address what I view as an obvious inequity in how safety rules 
are enforced in the Department. Under the Price-Anderson 
provisions of the Atomic Energy Act, the Department can assess 
civil penalties against its contractors that violate DOE rules, 
regulations, and orders on nuclear safety. However, the Atomic 
Energy Act contains an explicit provision that exempts the 
Department's nonprofit contractors from paying any such fines 
when they commit a nuclear safety violation. If civil penalties 
are an effective tool to improve the safety and performance of 
the for-profit contractors, the same tool should be applied to 
the nonprofits as well. This particular problem was discussed 
in some detail at an Oversight and Investigations hearing last 
June on Department of Energy Worker Safety.
    The second bill is H.R. 3906, which was introduced last 
week by Chairman Bliley. I join the Chairman and several of my 
colleagues from the committee in cosponsoring H.R. 3906. This 
bill will establish, in statute, an independent office to 
oversee security throughout the entire Department of Energy 
complex. This is the same office that Secretary Richardson has 
already instituted at DOE headquarters, and it would function 
the same way that it does today.
    The only change--and it is an important change--made by the 
bill is to establish a direct reporting line from the 
Independent Security Oversight Office to the Congress, so that 
the Congress has timely, uncensored information on security 
problems in the field. Security oversight has been the topic of 
numerous hearings, most recently the one held just last week in 
cooperation with the Oversight and Investigations Subcommittee 
of this committee.
    The third bill, H.R. 3907, was introduced last week by 
Chairman Bliley and several of our colleagues on the committee, 
and also on the Science Committee. H.R. 3907 would put an end 
to the Department trying to regulate itself when it comes to 
safety manners.
    Effective October 1, 2001, the Nuclear Regulatory 
Commission would assume regulatory and enforcement 
responsibility for nuclear safety throughout the Department of 
Energy complex, and OSHA will do the same for worker safety. 
The existing Defense Nuclear Facility Safety Board would be 
abolished and its staff resources made available to the Nuclear 
Regulatory Commission. I recognize that this is an ambitious 
undertaking, and an ambitious schedule, but the alternative of 
continuing to let the Department regulate itself is, in my 
opinion, much worse.
    These bills are meant to address some of the most obvious 
safety and security problems in the Department of Energy. I 
consider these changes to be long overdue in the DOE complex.
    The Department keeps offering us reassurances that their 
safety and security problems are always in the past and are now 
under control. That particular line holds true until the next 
headline. Just last week, for example, several workers at the 
Los Alamos Laboratory were exposed to plutonium.
    In the face of that kind of accident, it's hard to argue 
that the Department of Energy is doing a fine job on safety and 
should continue to be left to its own devices in terms of 
regulating its safety programs.
    I want to issue two challenges today: The first is to my 
fellow members on this subcommittee from both sides of the 
aisle. Mr. Upton, the subcommittee chairman of the Oversight 
and Investigations Subcommittee, pointed out at last week's 
joint hearing on safety and security that the Commerce 
Committee knows better than any other committee in the 
Congress, the extent of the Department's problems in these 
areas. The committee's concerns with the Department of Energy's 
safety and security systems go back years, even decades, and 
have been the subject of numerous hearings.
    It is time that we take our extensive base of accumulated 
knowledge about the Department's safety and security problems 
and do something constructive to solve the problems. This has 
always been an area of bipartisan concern for the members of 
this committee, and I intend to keep it that way. I'm more than 
happy to work with all members of the subcommittee to address 
particular concerns to improve the bills that are before us. 
None of us want to read any more headlines about safety and 
security fiascos in the Department, knowing that we, this 
subcommittee, holds the power to reduce those risks and to 
prevent future problems.
    Second, I want to challenge our witnesses who are here 
today to help us improve the legislation. The three bills 
before are only starting points for discussion.
    No doubt, there is substantial room for improvement in all 
three bills. I would expect that there will be significant 
changes to these bills before we take them to markup, but I do 
intend to go to markup and hope that we can go to markup before 
the House breaks for the Easter recess. That's not that far 
away in terms of legislative days. Please take advantage of 
today's hearing and work with us on the committee on both sides 
of the aisle over the next several weeks to make these bills 
better than they are today. We're serious about solving the 
problems, but we do want to do it right.
    I want to welcome our witnesses today, and I look forward 
to hearing their thoughts on these bills. I'd like to point 
out, before I recognize Mr. Boucher for an opening statement, 
and then Mr. Sawyer and Mr. Rogan, that there are several bills 
on the floor today that originated in this subcommittee.
    We have a nuclear waste bill, and we have an energy policy 
bill that came out of the Foreign Relations Committee, and 
members on this subcommittee are going to want to be involved 
in those bills on the floor, so we're going to have to have a 
tag-team system for us that want to hear the witnesses before 
us, and also want to participate in the floor debate. I don't 
want our witnesses to feel unloved, if we're shuttling back and 
forth several times.
    With that, I would welcome our ranking member, the 
Honorable Rick Boucher of Virginia, for his opening statement.
    Mr. Boucher. Thank you very much, Mr. Chairman. This 
morning we examine legislation which addresses the historical 
concerns of this committee regarding security and safety 
accountability at the Department of Energy.
    The committee has taken steps over more than a decade to 
address this concern. This committee was responsible for the 
establishment of an Independent Oversight Office for Security 
at DOE, and was responsible for the creation of the Defense 
Facilities Nuclear Safety Board in lieu of external regulation.
    Over the years, the committee has revealed in hearings, the 
most recent of which was conducted last year, the 
accountability problems caused by permitting the non-profit 
weapons laboratories to be exempt from fines and penalties for 
their safety violations.
    I'm pleased that some of the legislation we're considering 
this morning addresses that concern. The fact that all of the 
agencies before us today essentially want to leave everything 
as it is, should not prevent us from looking more closely at 
legislative changes.
    However, Mr. Chairman, I think we also need to be careful 
not to propose significant increases in agency responsibilities 
without providing those agencies with the necessary resources 
to accomplish the missions that we set forth in the legislative 
changes.
    I look forward to hearing from these witnesses as we 
continue our review of these matters.
    Mr. Barton. I thank the gentleman and compliment him on the 
brevity of his opening statement. That is definitely an 
improvement over Congressman Hall.
    Mr. Boucher. Good.
    Mr. Barton. It took him 5 minutes just to say hello. The 
gentleman from California, Mr. Rogan, do you wish to give an 
opening statement?
    Mr. Rogan. Mr. Chairman, you will compliment me also. I 
thank you for calling this hearing, and I expect that it will 
be very informative, and I don't have any further opening 
statement.
    Mr. Barton. The gentleman from Ohio, Mr. Sawyer, for an 
opening statement.
    Mr. Sawyer. Thank you, Mr. Chairman, thank you for your 
leadership in calling this hearing, and in the measures that 
you have brought before us for our consideration.
    Last August, the Department of Energy revealed that the 
Portsmouth gaseous diffusion plant in Piketon, Ohio, received 
plutonium-laced uranium for about 25 years, from the 1950's to 
the 1970's.
    The employees at the plant were unaware that they were 
exposed to highly radioactive plutonium. It's a familiar 
scenario. It's an experience that's not isolated to Ohio.
    The well-publicized problems in Paducah, Kentucky, 
Portsmouth's sister plant, are almost identical in its 
experience.
    Plutonium first emerged as a clear threat to public health 
and safety in Piketon in 1993 when contaminated sediment was 
discovered in Little Beaver Creek, just off the plant's 
grounds.
    In 1996, the Ohio EPA again found plutonium contamination 
in a three-acre plot on the east side of the plant grounds. 
It's unfortunate that the early findings in 1993 and again in 
1996 did not receive a much stronger reaction from DOE, 
responsible as it is for internal oversight.
    I particularly want to call attention to the work that our 
colleague and friend on this committee undertook in the work 
that Ted Strickland did in fighting for workers at the 
Portsmouth site, in finding Federal money for health screening 
and cleanup efforts.
    I also very much appreciate Secretary Richardson's efforts 
to put the cleanup on a high-order agenda.
    It took media pressure in the summer of 1999 to launch 
investigations, apologize to workers, and pledge compensation, 
6 years after the contamination was found.
    Congress missed the mark last year, I believe, by focusing 
too narrowly on the control of weapons information, as 
important as that may have been, failing to take into account 
an even larger national security threat, the possibility of an 
environmental disaster in America's back yard.
    I believe Congress should consider all facets of public 
interest, environmental, health and safety, as well as security 
when considering DOE restructuring proposals.
    And it is for that reason that I agree with the premise, 
Mr. Chairman, of the three bills being considered. We should 
make contractors liable. We should strengthen internal 
oversight, and we should expand external safety and 
environmental oversight as well.
    I agree with you that there are some details of these 
proposals that need our careful attention, but I think we're on 
the right track with these reforms, and I look forward to our 
witnesses' comments on how we can improve and strengthen 
accountability and oversight.
    Again, Mr. Chairman, thank you.
    Mr. Barton. I thank the gentleman for that statement. 
Seeing no other members present to give an opening statement in 
person, the Chair would ask unanimous consent that all members 
not present have the requisite number of days to enter their 
openings statement in the record at the appropriate point. Is 
there an objection to such a unanimous consent request?
    [No response.]
    Mr. Barton. Hearing none, so ordered.
    [Additional statement submitted for the record follows:]
 Prepared Statement of Hon. Tom Bliley, Chairman, Committee on Commerce
    Thank you, Mr. Chairman. Today marks a very important step for this 
Committee. We have held countless hearings in past years on safety and 
security failures in the Department of Energy. Our Members have worked 
hard behind the scenes to improve the oversight of these important 
matters within the Department, and we have worked with other Committees 
to improve related legislation moving through the Congress.
    Those efforts, while useful, have been mere ``Band-Aids'' that help 
to stop the bleeding at DOE but do not really cure the underlying 
problems. As retired Senator Rudman observed last year, the unique 
culture in the Department of Energy is extremely resistant to change. 
The three bills before the Subcommittee today make a giant stride 
toward changing that culture and getting at the root causes of some of 
these safety and security failures.
    H.R. 3833 will correct a perverse system in which the non-profit 
DOE contractors do not pay any fines when they commit nuclear safety 
violations. H.R. 3906 will codify in law that same system of 
independent security oversight that Secretary Richardson has already 
put in place in DOE, and will provide for direct reporting to the 
Congress. And H.R. 3907 will bring to an end DOE's attempt to regulate 
itself. Instead, the Nuclear Regulatory Commission and the Occupational 
Safety and Health Administration will become responsible for safety 
regulation of the DOE complex. All three of these bills are meant to 
provide DOE and its contractors with the right set of incentives to 
take safety and security more seriously.
    No doubt the DOE bureaucracy will resist these changes. Correcting 
failures is always difficult, and is always resisted by those invested 
in preserving the status quo. But the Nation cannot afford to keep 
relying in blind faith on the failed promises of DOE that things will 
get better. Taxpayers are going to have to spend hundreds of billions 
to clean up environmental contamination throughout the DOE complex and 
to compensate the workers harmed by DOE's careless safety practices. 
Americans now have worry that slipshod security measures may have 
allowed a foreign power to steal valuable nuclear weapons designs. It 
is time to bring about a fundamental change in the culture at DOE. We 
must ensure that these failures are never repeated in the future.
    I commend Chairman Barton for his aggressive action on these bills, 
and I hope he can bring them to Subcommittee markup in the very near 
future.

    Mr. Barton. We want to welcome our first panel. Your 
statements are in the record in their entirety. We're going to 
start with the General Counsel at the Department of Energy. 
Then we will recognize the Chairman of the Nuclear Regulatory 
Commission, Mr. Meserve, and then we will recognize Mr. 
Conway--no, actually, Mr. Mande is more to the right, so we'll 
recognize him and then Mr. Conway.
    The subcommittee also wants to express its condolences to 
Commissioner McGaffigan on the passing of your wife. We 
understand that that was a very traumatic event, and I 
personally have a great degree of sympathy for you since I have 
a brother who has liver cancer that's been diagnosed as 
incurable. So you have our prayers on that.
    Ms. Sullivan, we're going to recognize you for 7 minutes. 
We do thank you for getting your testimony in on time, barely, 
but you did get it in on time. And so that's a good way to 
start this hearing. Ms. Sullivan?

    STATEMENTS OF MARY ANNE SULLIVAN, GENERAL COUNSEL, U.S. 
   DEPARTMENT OF ENERGY; HON. RICHARD A. MESERVE, CHAIRMAN; 
ACCOMPANIED BY HON. GRETA JOY DICUS, COMMISSIONER; HON. NILS J. 
DIAZ, COMMISSIONER; HON. EDWARD McGAFFIGAN, JR., COMMISSIONER; 
  HON. JEFFREY S. MERRIFIELD, COMMISSIONER,NUCLEAR REGULATORY 
 COMMISSION; HON. JEROLD R. MANDE, DEPUTY ASSISTANT SECRETARY 
 FOR LABOR, OCCUPATIONAL SAFETY AND HEALTH ADMINISTRATION; AND 
   HON. JOHN T. CONWAY, CHAIRMAN, DEFENSE NUCLEAR FACILITIES 
                          SAFETY BOARD

    Ms. Sullivan. Thank you, Mr. Chairman and members of the 
committee for the opportunity to discuss with you, H.R. 3907, 
concerning external safety regulation; H.R. 3383, concerning 
civil penalties for DOE nonprofit contractors; and H.R. 3906, 
concerning internal security oversight at the Department.
    I'd like to begin with external regulation. During the 
1990's, the Department engaged in a systematic evaluation of 
the advisability of external safety regulation. The culmination 
of this effort was a joint pilot program by the Department and 
the NRC to determine the cost and benefits associated with NRC 
regulation.
    Unlike previous studies, the joint pilot program involved 
real-time simulation of external regulation. The findings of 
the joint pilot program were quite informative, and led to the 
decision by the Secretary not to seek external regulation by 
NRC.
    Secretary Richardson pointed to three key elements in 
concluding that DOE should not proceed with NRC regulation: The 
potential difficulties in implementation, the potential costs, 
and the absence of a clear benefit to safety.
    Implementation of NRC regulation would involve a number of 
difficult, unresolved issues. I'll offer just a few examples:
    NRC regulations and standards were developed for commercial 
facilities. They were not developed with DOE's complex and 
diverse activities in mind.
    Application of NRC regulations to DOE activities would 
require a substantial effort to accommodate the unique hazards, 
operations, and security considerations at DOE.
    NRC does not have experience in regulating certain kinds of 
activities at DOE, such as accelerators. In addition, the pilot 
program did not even consider defense nuclear facilities for 
which there is no corresponding activity in the commercial 
sector.
    The joint pilot program could not reach consensus on 
whether the licensee for a DOE activity should be the 
Department, its contractor or both. On balance, DOE believed it 
was essential for it to be the licensee, because DOE is 
ultimately responsible for the facilities. NRC could not accept 
this fundamental proposition.
    Many DOE facilities are old. They have physical layouts and 
equipment that cannot be readily changed. Backfit and other 
legacy issues could be an especially difficult and costly 
problem for facilities with relatively short remaining lives.
    The Commission has specific requirements relating to the 
schedule for deactivation and decommissioning. These are 
intended to ensure that licensees complete their license 
responsibilities while they still have a secure financial base. 
This rationale carries considerably less weight when applied to 
a Federal agency. More compelling funding priorities typically 
account for delay in D&D activities, and external regulation 
doesn't solve the funding problem.
    Turning to the cost impacts, the joint pilot program did 
not attempt to estimate incremental costs of external 
regulation DOE-wide; rather, it focused only on the costs of 
NRC regulation of the particular pilots that were analyzed.
    Even so, some of the Department's estimates were 
substantially higher than NRC's. The variation resulted from 
uncertainty in the range of regulatory approaches that the NRC 
might actually use for the many DOE activities that have no 
current counterpart in the NRC regulatory regime.
    The essential learning was that virtually every DOE 
activity would have to be separately reviewed to determine the 
regulatory regime, and the associated costs cannot be predicted 
with any certainty.
    We do know from our experience with NRC's certification of 
the gaseous diffusion plants, the license transfer for Ft. St. 
Vrain, and the licensing of the Idaho Spent Fuel Facility, that 
initial cost estimates tend to be considerably lower than 
actual costs.
    The final, but, it seems to me, critical point is that the 
joint pilot program did not demonstrate that NRC regulation 
would result in more protection of workers, members of the 
public, or the environment.
    This is because of the tremendous strides, certainly not 
yet complete, that the Department has made to improve safety. 
This improvement results from, among other things, from the 
creation of the Office of Enforcement and Investigation, 
adoption of integrated safety management requirements in DOE 
contracts, and independent oversight by the Defense Nuclear 
Facilities Safety Board.
    In light of the numerous unresolved issues associated with 
transition to NRC, and the increasing success of initiatives to 
improve safety at DOE, the Department cannot support H.R. 3907.
    We believe that the substantial resources that would be 
required to prepare for a shift to NRC regulation would be 
better spent on cleanup and on ensuring compliance with 
existing safety requirements.
    Let me turn now to the issue of civil penalties for DOE 
nonprofit contractors: DOE supports subjecting its nonprofit 
contractors to civil penalties, limited to the amount of fee 
the nonprofits receive under their contracts.
    H.R. 3383 would subject nonprofits to civil penalties, but 
it doesn't limit the amount of the penalties to the fee 
provided for in the contract. The risk with that approach is 
that the nonprofits may be unwilling to contract with the 
Department because of fears of putting their endowments at 
risk.
    Alternatively, they may insist on fee increases, 
disproportionate to the additional risk the civil penalties 
represent. These higher fees would divert funds away from 
fundamental DOE research.
    Accordingly, the Department would like to work with the 
committee on a provision to limit the penalties for nonprofits 
to the amount of fee.
    Finally, on the issue of internal security oversight, H.R. 
3906 would require the Secretary to maintain an Office of 
Independent Security Oversight, specify that Office's 
jurisdiction, and impose certain specific reporting 
requirements on both the Secretary and the Director of the 
Office.
    Among the Secretary's responses to concerns over security 
last year, was the creation of just such an office, as the 
Chairman recognized. This new office had its origin in the 
Office of Oversight, reporting to the Assistant Secretary for 
Environment, Safety, and Health.
    The new office provides independent analysis of the 
performance of safeguards and security functions across the 
Department, but does so directly under the Secretary.
    Since it was created, the office has successfully applied 
the full range of its appraisal skills to the Department, and 
as the Director testified last week, it will continue to do so 
with regard to the NNSA.
    The Department's threshold concern about H.R. 3906 is that 
it proposes to rigidly define the structure of an office that 
already exists. The office was created as a timely response to 
significant security concerns.
    The Department of Energy Organization Act gives the 
Secretary broad reorganization powers to respond to such 
circumstances. The Secretary wisely exercised those powers by 
restructuring and refocusing an existing office, giving it 
substantially new and important functions, and requiring it to 
report to him.
    When the Congress institutionalizes the structure and 
mission of an organization like that, it deprives the 
Department and future Secretaries of the ability to adapt to 
changing circumstances in the future.
    This concern is aggravated by other provisions of the bill. 
Section 1 would mandate that the Director is not subject to 
supervision by anyone other than the Secretary. This undermines 
the Secretary's authority to decide internal reporting matters.
    Section 2 would require the Secretary and the Director to 
report to the Congress, areas where they have differences of 
opinion. These required revelations would impair the 
Secretary's ability to receive frank and candid advice from his 
subordinates.
    In addition, they improperly subject to Congressional 
refereeing, any of the Secretary's management decisions with 
which the Director might disagree.
    In short, we are concerned that H.R. 3906 would, through 
legislative mandate, threaten the success of a positive 
management response to real problems.
    Mr. Barton. Ms. Sullivan, you're 2 minutes over your 7 
minutes. Is that it?
    Ms. Sullivan. I'm concluded. Thank you very much for the 
opportunity to address these important matters.
    [The prepared statement of Mary Anne Sullivan follows:]
    Prepared Statement of Mary Anne Sullivan, General Counsel, U.S. 
                          Department of Energy
    Thank you, Mr. Chairman and members of the Committee, for the 
opportunity to discuss: H.R. 3907, concerning external safety 
regulation of the Department of Energy (DOE) by the Nuclear Regulatory 
Commission (NRC) and by the Occupational Safety and Health 
Administration (OSHA); H.R. 3383, concerning civil penalties for safety 
violations by non-profit DOE contractors; and H.R. 3906, concerning 
internal security oversight within the Department.
                          external regulation
    I will begin with the issue of external safety regulation of the 
Department. During the 1990's, the Department engaged in a thorough and 
systematic evaluation of the advisability of external safety regulation 
of the Department. Options considered included broadening the scope of 
oversight through the existing Defense Nuclear Safety Board, and 
transferring responsibility to the Commission. The culmination of this 
effort was a joint pilot program by the Department and the Commission 
to determine the costs and benefits that would be associated with the 
transition to external regulation under the Commission. Unlike previous 
studies and analyses of the issue of external safety regulation, the 
joint pilot program involved real-time simulation of external 
regulation activities. Specifically, representatives of the Department 
and the Commission worked together closely to determine what could be 
expected if the Commission assumed regulatory responsibility for 
Lawrence Berkeley National Laboratory (LBNL), the Receiving Basin for 
Offsite Fuel (RBOF) at Savannah River, and the Radiochemical 
Engineering Development Center (REDC) at Oak Ridge National Laboratory.
    In addition to the joint pilot program, the Department has actual 
experience with NRC licensing of facilities involving commercial 
nuclear materials which are subject to NRC licensing under the Energy 
Reorganization Act. DOE applied for and was granted a transfer of the 
NRC materials license for the Fort St. Vrain Independent Spent Fuel 
Storage Installation. DOE has also received a license for the dry 
storage of core debris from the Three Mile Island Unit Two (TMI-2) 
reactor at the Independent Spent Fuel Storage Installation at Idaho. 
The Department also has experience with the Commission in the 
certification of the gaseous diffusion plants (GDPs).
    The findings of the joint pilot program were quite informative and 
led to the decision by the Department not to seek a greater level of 
external safety regulation of the Department than currently exists. In 
his February 19, 1999, letters to Congress, Secretary of Energy, Bill 
Richardson, characterized the insights gleaned from the joint pilot 
program as follows:
        These pilots have highlighted a number of significant, 
        unresolved issues including: ascertaining whether DOE or its 
        contractors should most appropriately hold a license; the 
        difficulties in assessing facility design under NRC standards 
        in some older facilities because we lack original construction 
        plans; the extent to which older facilities can be 
        ``retrofitted'' or upgraded to meet NRC standards; applicable 
        standards for safeguards and security; deactivation and 
        decommissioning; and cost. Our analysis to date also indicates 
        that many of the potential benefits that we expected to see 
        from external regulation have not been demonstrated, and appear 
        to be outweighed by associated costs and difficulties raised in 
        the pilot projects.
    I will elaborate on (1) the potential difficulties in implementing 
external safety regulation, (2) the potential costs of external safety 
regulation, and (3) the expected benefits for safety.
Implementation Issues
    Implementation of external safety regulation would involve the 
following unresolved issues:

 There are no ``standard'' DOE facilities. Most DOE activities 
        would have to be separately reviewed to determine the 
        individual elements of work that have no obvious counterpart in 
        the NRC regulatory regime. Thus the full complement of 
        requirements to effect external regulation of each of these 
        activities cannot be predicted with certainty.
 NRC regulations and standards were developed for commercial 
        facilities, many of which have a high degree of similarity to 
        one another. They were not developed with the complex and 
        diverse activities that are found in the DOE complex in mind. 
        Application of NRC regulations and standards to DOE activities 
        would require substantial effort to accommodate the unique 
        hazards, operations, and security considerations associated 
        with the DOE complex. NRC members of the joint pilot program 
        team suggested that existing NRC regulations and standards 
        could be made to fit through exemptions or through the 
        flexibility of a ``risk-informed, performance-based'' approach 
        to licensing. However, securing an exemption can require 
        considerable time and effort and ``risk-informed, performance-
        based'' licensing is still a work in progress. In many cases, 
        the Commission might need to adopt new regulations and 
        standards for DOE activities or go through an administrative 
        process to adopt existing DOE standards.
 The Commission does not have experience in regulating certain 
        DOE activities. For example, accelerators do not typically 
        involve source, special nuclear, or byproduct materials and 
        thus do not come within the Commission's jurisdiction. In fact, 
        commercial accelerators have long been regulated by State 
        authorities. Similarly, many of the kinds of research 
        activities involving source and by-product materisals that 
        occur at Lawrence Berkeley National Laboratory are regulated by 
        States under Agreement State authority when these research 
        activities take place at non-federal facilities such as 
        educational and commercial laboratories. It should also be 
        noted that the joint pilot program did not consider external 
        regulation of DOE defense nuclear facilities. These defense 
        facilities conduct many unique activities for which there is no 
        corresponding activity in the commercial sector and thus for 
        which the Commission has no experience.
 NRC requirements, especially those relating to material 
        control and accountability (MC&A), reflect safeguard and 
        security considerations for commercial activities. The 
        safeguard and security considerations for DOE activities are 
        somewhat different. These differences do not relate to safety 
        concerns.
 The joint pilot program identified numerous impacts that would 
        arise from regulation by the Commission of some activities at a 
        DOE site but not other activities at the same site. These 
        impacts would relate primarily to the treatment of collocated 
        workers and of shared-site resources. At many DOE sites, it 
        might not be possible for the Commission to regulate DOE non-
        defense activities without also regulating DOE defense nuclear 
        facilities.
 The joint pilot program could not reach consensus on whether 
        the licensee for a DOE activity should be the Department, its 
        contractor, or both. A strong argument can be made that the 
        Department should be the licensee because it is responsible for 
        the safety of its activities and provides the funding to the 
        contractor. On the other hand, the contractor is the entity 
        responsible for actually operating the facility, and thus for 
        implementing license requirements. On balance, the Department 
        concluded it should be the licensee in all such cases.
 Many DOE facilities were constructed many years ago and 
        possess physical layouts and equipment that cannot be readily 
        changed. If the Commission were to assume regulatory 
        responsibility for these facilities, it would be necessary to 
        deal with backfit and other legacy issues that do not relate 
        specifically to safety, but rather to technical compliance with 
        existing NRC requirements. This would be an especially 
        difficult and potentially very costly problem for facilities 
        with a relatively short remaining life.
 The Commission has many requirements relating to the schedule 
        on which certain activities must be undertaken. In many cases, 
        especially with respect to deactivation and decommissioning, 
        these schedule requirements are intended to ensure that the 
        licensee (often a private entity) completes its 
        responsibilities under the license while it still has a secure 
        financial base. That same rationale carries considerably less 
        weight when applied to an agency of the federal government. NRC 
        was offered that to impose these same requirements on DOE 
        unilaterally was not likely, but it could not guarantee 
        immediate relief without a legislative fix..
Cost Impacts
    At the outset, it should be emphasized that the joint pilot program 
did not attempt estimate incremental costs of external regulation, DOE-
wide. Rather, it focused on estimating the costs that would be 
associated with the assumption by the NRC of regulation of LBNL, RBOF, 
and REDC. The estimated costs can be summarized as follows:

 With respect to LBNL, the estimated costs to the Department 
        were $700,000 of transition costs and $500,000 of annual costs. 
        The estimated costs to the Commission were $430,000 of 
        transition costs (primarily to support a rulemaking on the 
        regulation of accelerators) and $30,000 of annual costs.
 With respect to RBOF, the estimated costs to the Department 
        were $6 to $13.5 million of transition costs and $1.5 to $3.2 
        million of annual costs. The estimated costs to the Commission 
        were $678,000 of transition costs and $347,000 of annual costs.
 With respect to REDC, the estimated costs to the Department 
        were $900,000 to $5 million of transition costs and $1.1 
        million of annual costs. The estimated costs to the Commission 
        were $1.1 million of transition costs and $347,000 of annual 
        costs.
    Some of the Department's estimates are substantially higher than 
the lower limit estimates provided by NRC staff. The variation in 
estimates results from uncertainty in the range of approaches that the 
NRC staff would actually use in resolving specific issues, based on the 
NRC staff practices that have been used in recent years. For example, 
the REDC regulatory pilot indicated two possible outcomes for 
regulating materials (such as americium-252) central to the operation 
of REDC. One outcome could be that the Commission would be willing and 
able to reach a conclusion that DOE contractor's practices provided 
equivalence with NRC's safety requirements, and that minimal costs 
impacts could be obtained through a combination of waivers, adoption of 
DOE safety requirements, and risk-informed, performance based 
regulation. The other outcome could be that intervenors, or the NRC 
staff, would cause the Commission to promulgate new sets of 
requirements, and then demand compliance with the newly promulgated and 
prescriptive requirements. It may well be that the lower range of cost 
impacts would be obtained for all types of DOE activities, but it would 
be a mistake to believe that such an outcome is guaranteed.
    There are many DOE activities that have no direct counterpart in 
the NRC regulatory regime, and therefore, the cost impacts would depend 
on whether analogs to present regulatory practices were possible and 
practical, or whether new approaches would have to be developed. The 
joint pilot program has shown that, in some cases, it is possible to 
use analogs, to assume that a broad regulation (such as 10 CFR Part 70) 
is applicable, and to separate the components of that regulation into 
elements of a fact-based cost estimate. However, the Department 
believes that virtually every element of each DOE activity would have 
to be separately reviewed. to determine whether it could be regulated 
under the existing NRC regulatory regime or whether the Commission 
would have to modify existing requirements or develop new requirements. 
Where there is no direct counterpart in the NRC regulatory regime, the 
costs associated with NRC regulation of the work cannot be predicted in 
advance with any certainty.
    Any attempt to extrapolate the estimated costs to the DOE complex 
as a whole must take into account that the estimates developed as part 
of the joint pilot program assumed favorable regulatory treatment of 
many issues by the Commission and that LBNL, RBOF, and REDC represent 
relatively simple facilities from the viewpoint of regulation by the 
Commission. In addition, experience with the license transfer for Fort 
St Vrain, the licensing of the spent fuel facility in Idaho, and the 
certification of the GDPs indicates that initial estimates of the costs 
associated with regulation by the Commission tend to be considerably 
lower than the actual costs.
    In the case of the Fort St. Vrain ISFSI, the Department applied for 
and was granted a transfer of the NRC materials license. This facility 
is perhaps the best possible and most straight forward application of 
NRC regulations to a DOE activity. The facility was built and operated 
under NRC regulation and the regulations were drafted with this 
specific type of facility and activity in mind: dry storage of 
commercial spent nuclear fuel. However, it took 3 years to effect the 
license transfer. This was primarily a result of the Department's 
needing to provide additional documentation about its management making 
minor modifications to strictly adhere to specific details of NRC 
requirements and NRC staff's unfamiliarity with the Department's 
management approach and safety requirements. Another significant cost 
involved with the transfer was the cost of creating and instituting a 
quality assurance program that would meet NRC standards because the 
Department's approach to obtaining a high level of quality is entirely 
different than that of the Commission.
    The Department has also licensed the Independent Spent Fuel Storage 
Installation at Idaho for the dry storage of TMI-2 core debris. A 
significant difference existed in the seismic design standards between 
the Department and the Commission for low to moderate risk facilities 
such as this one. The Department's Idaho Operations Office applied for 
and was granted an exemption to the NRC seismic requirements. Had the 
Department not been granted this regulatory exemption, it was estimated 
that the facility would have cost as much as an additional $7 million 
to build. To meet milestones for completing construction and moving 
fuel into the dry storage facility contained in existing legal 
agreements with the State of Idaho, the Department found it necessary 
(and accordingly notified the Commission in writing) to proceed at risk 
by releasing construction of facility equipment prior to design 
approval by the Commission. Although the Commission did eventually 
approve the design and no milestones were missed, the implications of 
this event to future licensing activities are apparent: there is no 
reason to doubt the Commission's ability and willingness to grant 
appropriate exemptions, but there is a risk that needed and appropriate 
exemptions would not be immediately forthcoming.
    In the case of the GDPs, the transition costs were estimated 
initially to be approximately $60 million. Thus far, the actual 
transition costs have exceeded $300 million. Concurrently, the 
transition period increased from an estimate of 2 years to 3 1/2 years. 
It should be noted that the initial cost estimate was based on DOE's 
general knowledge of NRC fuel facility requirements (10 CFR 70) as well 
as initial interaction with NRC staff. The Commission, however, had 
limited standards to regulate the GDPs due to the unique nature of the 
facilities and operations. An extensive rulemaking process was needed 
to develop new regulatory standards.
Improvements in Safety
    The joint pilot program did not demonstrate that external safety 
regulation could be expected to result in more protection of workers, 
members of the public, or the environment. This results from: (1) DOE's 
emphasis on the identification and implementation of appropriate 
nuclear safety requirements; (2) creation of the Office of Enforcement 
and Investigations and increased use of field offices to enforce 
nuclear safety; (3) contract reform, including the adoption of 
integrated safety management requirements in DOE contracts; (4) 
continued independent oversight of nuclear safety matters by the Office 
of Environment, Safety and Health as well as the Defense Nuclear 
Facilities Safety Board and action on formal plans to address nuclear 
safety issues, and (5) public participation in decisions concerning the 
safety of DOE nuclear activities.
     The Department has improved the quality of the safety 
requirements applicable to its nuclear activities in several ways. It 
streamlined the nuclear safety orders and related documents in the DOE 
directives system to reduce unnecessary and redundant requirements. At 
the same time, where appropriate, the Department adopted certain 
requirements as regulations through the rulemaking process, including: 
(1) procedural requirements for DOE nuclear activities, including 
procedures for investigating possible violations of nuclear safety 
requirements and assessing civil penalties where such violations occur; 
(2) radiological protection requirements for workers and other persons 
involved in the conduct of DOE nuclear activities; (3) quality 
assurance requirements; (4) requirements on workplace substance abuse 
programs at DOE sites; and (5) whistleblower protection requirements. 
The Department currently is completing additional regulatory 
requirements on safety management and on radiological protection of the 
public and the environment. In addition, the Department engaged in a 
comprehensive exercise to ensure that the requirements used in 
connection with a particular activity are sufficient to assure adequate 
protection of workers, members of the public and the environment in a 
manner commensurate with the type and complexity of the activity and 
the associated hazards.
     The Department established the Office of Enforcement and 
Investigations, which reports to the Assistant Secretary for 
Environment, Safety and Health, to investigate possible violations of 
the nuclear safety requirements and, where appropriate, to impose civil 
penalties and other remedies and corrective actions. DOE field office 
and program personnel assist in investigations and enforcement and 
provide regular oversight of contractor activities.
     The Department has undertaken an extensive reform of its 
contracting process to improve the management of work and safety 
throughout the DOE complex. Specifically, it has revised the Department 
of Energy Acquisition Regulation (DEAR) to include provisions on 
performance-based contracting, competition, award fees, property 
management, record-keeping, insurance, litigation, claims, 
accountability provisions, and the conditional fee policy. The most 
significant contract reform affecting nuclear safety is the adoption of 
DEAR clauses that mandate: (1) the use of integrated safety management 
systems and (2) the identification of laws, regulations, and DOE 
directives to be applied to activities under DOE contracts.
     The DEAR clause on the Integration of Environment, Safety 
and Health into Work Planning and Execution establishes a standard 
prescribed contract clause on how contractors must perform work in a 
manner that ensures adequate protection for employees, the public, and 
the environment. It provides for: (1) defining the scope of work; (2) 
identifying and analyzing hazards associated with the work; (3) 
developing and implementing hazard controls; (4) performing work within 
controls; and (5) providing feedback on adequacy of controls and 
continuing to improve safety management. The clause establishes the 
principles that: (1) line managers must be given responsibility and 
held accountable for implementing health and safety requirements; (2) 
clear lines of authority and responsibility must be established; (3) 
workers and managers must have competence to assess and deal with the 
hazards; (4) resources must be effectively allocated; (5) hazards must 
be evaluated and an agreed-upon set of standards and requirements must 
be established before work is performed; (6) administrative and 
engineering controls must be tailored to the work and associated 
hazards; and (7) conditions and authorization authorities must be 
agreed upon. The clause specifically requires each contractor to submit 
a safety management system description for approval by the Department 
that explains how the contractor will implement the system to establish 
performance objectives, measures and commitments; integrate work 
planning, hazards assessment, hazard controls, budget and resource 
planning and continuous improvement.
     The DEAR clause on Laws, Regulations and DOE Directives is 
an integral part of the safety management system. This clause requires 
clear identification of requirements, including nuclear safety 
requirements, to be implemented in connection with nuclear activities 
under a contract. In general, the clause requires a contractor either 
to incorporate all applicable requirements in DOE Orders and 
regulations or to use a tailoring process to develop a set of 
environment, health and safety requirements that is commensurate with 
the complexities and hazards associated with the work to be performed 
under the contract.
     Since its creation in 1988, the Defense Nuclear Facilities 
Safety Board has provided independent oversight of DOE defense nuclear 
facilities and made many valuable recommendations on nuclear safety 
issues. Implementing these recommendations has been and continues to be 
an impetus for enhancing safety throughout the DOE complex. Indeed, DOE 
has never rejected a Defense Board recommendation.
     The Department has adopted and implemented a Public 
Participation Policy to foster improvements in nuclear safety by 
ensuring decisions benefit from the perspective of those interested in 
and affected by DOE activities, such as workers and those who live in 
communities where DOE activities take place. In furtherance of this 
policy, the Department has established citizens advisory boards (CABs) 
at all its major sites to establish open, ongoing, two-way 
communication, both formal and informal, between the Department and its 
stakeholders. This process provides a diverse collection of opinions, 
perspectives, and values and enables each party to learn about and 
better understand each other's views and positions. As a result of such 
communication, the Department can make better, more informed decisions.
    Through these initiatives, the Department has substantially 
improved its ability to provide a safe and healthy workplace, protect 
the communities near our facilities, and preserve the environment. We 
now have a strong safety structure under which: work and hazards are 
evaluated; appropriate safety requirements are identified and imposed 
on our contractors; integrated safety management operates to make 
compliance with these requirements an integral part of how work is 
performed; safety performance is an important part of determining 
contract fees; the Office of Enforcement investigates possible 
violations of safety requirements and imposes civil penalties where 
appropriate; and the Defense Board and our Independent Oversight Office 
verify how well the structure is working and make recommendations for 
improvements.
H.R. 3907
    In light of the numerous unresolved issues associated with a 
transition to external safety regulation, the potential costs of such a 
transition, and the ongoing success of the initiatives to improve 
safety throughout the DOE complex, the Department cannot support 
legislation to mandate external safety regulation by NRC of the 
Department. The substantial funds that would be required to prepare DOE 
facilities for a shift to external regulation would be better spent on 
achieving the Department's cleanup and mission goals. The manpower that 
would be required to implement a transition to external regulation 
would be better used in overseeing compliance with the Department's 
existing safety requirements.
    With respect to H.R. 3907, I note that the bill does not address in 
a meaningful manner the implementation issues identified by the joint 
pilot program and does not provide funding for the increased costs to 
both the Department and the Commission. In addition, the bill would 
abolish the Defense Board and extend external safety regulation to DOE 
defense nuclear facilities without any examination of the potential 
effects of such action on the Department's national security missions.
             civil penalties for nonprofit doe contractors
    In its Report to Congress on the Price-Anderson Act (DOE Price-
Anderson Report), the Department indicated that it supported 
continuation of the Congressional decision in the 1988 Price-Anderson 
Act Amendments not to apply civil penalties to nonprofit contractors. 
This decision reflected the belief of the Department that major 
universities and other nonprofits would be unwilling to put their 
educational endowments at risk for contract-related expenses such as 
civil penalties and that the increase in fees they would insist upon to 
protect against even the slim possibility of such a result would 
outweigh the benefit of being able to assess penalties.
    The Department also indicated that all nonprofit contractors, 
nonprofit subcontractors and nonprofit suppliers should be treated the 
same with respect to the applicability of civil penalties. Accordingly, 
it suggested eliminating the statutory exemption for specific named 
contractors and their subcontractors and suppliers and replacing it 
with a generic exemption to cover all nonprofit contractors, nonprofit 
subcontractors and nonprofit suppliers. This change would eliminate the 
need to identify particular entities by name in the statute and also 
eliminate the distinction between ``educational'' nonprofits and other 
nonprofit entities. As part of such a change, the exemption of for-
profit subcontractors and suppliers to nonprofit contractors exempt by 
statute would be eliminated.
    Subsequent to the submission of the DOE Price-Anderson Report to 
Congress, several DOE nonprofit contractors indicated they could accept 
civil penalties if the amount of the civil penalties were limited to 
the amount of the fee they received under their contracts with the 
Department. Recently, S. 2162 has been introduced in the Senate to 
extend the Price-Anderson Act. This Senate bill contains a provision 
that would make a nonprofit DOE contractor subject to civil penalties 
up to the amount of the fee provided for in its contract with the 
Department. The Department supports this approach.
                               h.r. 3383
    H.R. 3383 would likewise make nonprofit DOE contractors subject to 
civil penalties, but it contains no provision that would tie the amount 
of a civil penalty imposed on a nonprofit DOE contractor to the fee 
provided for in its contract with the Department. The Department 
supports subjecting non-profit contractors to civil penalties up to the 
amount of the fee, but would need to consider further the implications 
of allowing for such penalties to exceed the amount of fee provided for 
in the contract.
                      internal security oversight
    Now I will turn to H.R. 3906, which proposes to specify for DOE the 
internal mechanisms and authorities to independently assess the 
effectiveness of its policy and site performance in the areas of 
safeguards and security and cyber security. This bill would require the 
Secretary of Energy to maintain an ``Office of Independent Security 
Oversight,'' specify that Office's jurisdiction, and impose peculiar 
statutory reporting requirements on both the Secretary and the 
Directory of the Office.
    First, to put my comments in context, I would like to describe the 
creation and functions of the Department's existing Office of 
Independent Oversight and Performance Assurance. In response to 
numerous concerns over security last year, Secretary Richardson 
announced his Security Reform Package on May 11, 1999, a significant 
feature of which was the creation of the Office of Independent 
Oversight and Performance Assurance reporting directly to the 
Secretary.
    This new office had its origin in the Office of Oversight under the 
Assistant Secretary for Environment, Safety and Health, which had been 
responsible for the performance of safety and security reviews. The new 
Office provides independent analysis of the performance of safeguards 
and security and other critical functions from across the Department, 
but does so directly under the Secretary.
    Since it was created in May, the Office of Independent Oversight 
has been headed by Mr. Glenn S. Podonsky. The office is staffed by 
highly qualified and experienced personnel, many of whom are recognized 
as national experts in their individual security disciplines. The 
personnel are trained inspectors, skilled at determining, on a 
practical level, the adequacy of protection programs. The Office 
successfully has applied the full range of its appraisal skills to the 
Department, and as Mr. Podonsky testified before the House Commerce 
Committee on March 14, 2000, it will continue to do so with regard to 
the NNSA.
    My threshold objection to HR 3906 is that it proposes rigidly to 
define the structure of an office which already exists within the 
Department. The office was created by Secretary Richardson pursuant to 
his management authorities under the Department of Energy Organization 
Act as a timely response to significant security concerns facing the 
Department. The Department of Energy Organization Act gives the 
Secretary broad reassignment powers and appropriate reorganization 
ability to respond to changing circumstances. The Secretary wisely 
exercised those powers to respond to the Departmental security concerns 
by restructuring and refocusing an existing office, giving it 
substantially new and important functions, and requiring it to report 
directly to him.
    When the Congress institutionalizes the structure and missions of 
an organization like the existing Office of Independent Oversight, 
which was created by the Secretary to address a particular concern at a 
particular time, it deprives the Department and future Secretaries of 
the ability to adapt to changing circumstances and to craft appropriate 
future responses, as the Secretary did in the case of the existing 
Office of Independent Oversight and Performance Assurance. The result 
is a significant erosion of the Secretary's management authority. 
Rather than acknowledging the appropriateness of the Secretary's action 
in creating the Office, HR 3906 potentially would hamstring the 
Department in the future by institutionalizing an existing function 
rather than permitting the Secretary to retain needed flexibility to 
respond appropriately to changing circumstances.
    This threshold concern is aggravated by other specific provisions 
of the bill. The provision in Section 1(a) that would mandate that the 
Director report directly to the Secretary and is not subject to 
supervision by any other office within DOE is further evidence of the 
bill's objectionable erosion of the Secretary's internal management 
authority. The Secretary must retain the authority to decide the 
internal reporting chain.
    Section 2 contains additional objectionable features. Section 2(8) 
would require that the Office of Independent Security Oversight to 
transmit to the Congress and the Secretary annual reports, that include 
a description of any significant security policy decision with which 
the Office Director is in disagreement. Section 2(b) would also require 
the Secretary to transmit to the Congress a report which includes an 
identification of each significant problem, deficiency, or 
recommendation in the Office's annual report with which the Secretary 
is in disagreement, and an explanation of the reasons for any failure 
on the part of DOE to complete corrective actions. Read together these 
two subsections would require the Secretary and the Director to report 
to the Congress areas where they have a difference of opinion. These 
required revelations to the Congress by Departmental subordinates 
impairs the Secretary's ability to receive frank and candid advice from 
his subordinates. In addition, these peculiar reporting requirements 
also improperly subject to Congressional refereeing any of the 
Secretary's management decisions with which the Director might 
disagree. Disagreements regarding execution of the law are proper 
subjects of decisions by the President and his immediate subordinates, 
not by elements of the legislative branch. On a practical level, these 
concurrent reporting requirements would potentially undermine the kind 
of positive working relationship between the Secretary and the Director 
that has enabled the office to function so effectively since its 
creation.
    Section 2(d) contains a similar requirement for special reports. 
The Director would be required to report immediately to the Secretary 
and the Congress whenever the Director becomes aware of particularly 
serious or flagrant problems or deficiencies. The Secretary then, 
within seven days after receiving such a report, would be required to 
report to the Congress on the corrective actions taken to address such 
problems. This concurrent reporting requirement would again 
inappropriately insinuate the Congress into the executive 
decisionmaking process and execution of laws. Concurrent reporting 
requirements may breach the separation of powers by disrupting the 
chain of command within the executive branch. Here they would impede 
the Secretary in exercising his responsibility to supervise and control 
departmental subordinates. Moreover, this provision would infringe the 
Secretary's authority, as the President's immediate subordinate and as 
the head of an executive agency, to determine the executive branch's 
views that are presented to Congress.
    Finally, I have similar concerns about sections 2(e) and 2(f), 
which inappropriately would prohibit the Secretary from altering, 
modifying, or otherwise changing the substance of certain reports to 
the Congress or testimony by his subordinate Office Director. The 
Congress must determine what laws the President and Cabinet officers 
are to enforce, but the Congress may not impair the President's 
ability--through the Secretary--to determine the nature of official 
communications to the Congress. Nor the Congress should dictate how the 
Executive Branch is to execute the law. Efforts such as those contained 
in this bill which seek to determine the precise organizational 
structure of an executive branch department and the chain of command 
with respect to internal management decisions serious threaten the 
Secretary's ability to effectively and efficiently fulfill his 
responsibilities to execute the law.

    Mr. Barton. Thank you. We're going to recognize the 
Chairman of the NRC, Mr. Meserve. I'm going to run and vote. 
Congresswoman Wilson is going to take the Chair, and I will 
rush back. We're going to try to continue the hearing without 
having to suspend for the vote.
    You are recognized for 7 minutes.

              STATEMENT OF HON. RICHARD A. MESERVE

    Mr. Meserve. Good morning. It is a pleasure to appear 
before you today to discuss the proposal for external 
regulation of facilities owned or operated by the Department of 
Energy and in particular to explain the Commission's views in 
the recently introduced bill, H.R. 3907, External Regulation of 
the Department of Energy Act.
    I am joined by my fellow Commissioners Greta Dicus, Nils 
Diaz, Edward McGaffigan, Jr., and Jeffrey Merrifield.
    As the Commission has previously testified, the Commission 
believes that the NRC could be the sole regulator of DOE's 
nuclear and radiological safety if the Congress determined that 
such regulation was in the best interests of the nation. The 
Commission also testified that we believe that a majority of 
the technical, policy and regulatory issues identified during 
the NRC-DOE pilot program at three DOE facilities can be 
adequately resolved in the existing NRC regulatory framework.
    We see a path to resolving the issues and we continue to 
stand by our previous testimony.
    Today we are testifying on a significantly different 
approach than that discussed in our previous testimony. H.R. 
3907 would require the NRC to assume regulatory jurisdiction 
over the entirety of DOE's activities, both defense and 
nondefense at one time. The Commission strongly prefers a 
multiphased approach.
    Our concern is that a one-phase approach could divert 
significant agency resources from important ongoing regulatory 
initiatives relating to current NRC licensees. These 
initiatives, which include license renewal, license transfers, 
a new reactor oversight process, a more effective license 
amendment process, and dry cask storage for spent nuclear fuel, 
have been urged by Congress and require significant agency 
resources to bring to fruition. NRC previously testified that 
it could initially regulate the relatively less complex, less 
costly facilities of DOE's Office of Energy Research, now the 
Office of Science, and the Office of Nuclear Energy, which is 
now the Office of Nuclear Energy, Science and Technology and 
that, subject to receiving adequate resources, the NRC could 
then gradually phase in the more complex, more costly 
facilities of DOE's Office of Environmental Management and the 
National Nuclear Security Administration over a period of 
years.
    Assuming responsibility for all DOE nuclear facilities at 
one time could overwhelm the agency and place at risk the 
critical regulatory initiatives currently underway, thus the 
Commission does not believe that the approach described in H.R. 
3907 is feasible, even if significant resources were made 
available. Indeed, we would have a very hard time estimating 
the necessary NRC resources without further study.
    Let me give you an example of the cost associated with a 
very complex facility. The NRC now provides regulatory advice 
to the DOE concerning DOE's Hanford Tank Waste Remediation 
Systems Project. This effort includes a resident inspector who 
is onsite full-time and requires significant involvement both 
by our Headquarters Staff and our Center for Nuclear Waste 
Regulatory Analyses in Texas.
    There is no prospect for an NRC regulatory role until at 
least 2015 under DOE's current program, yet NRC's current 
assistance is costing about $2.4 million each year. The Hanford 
Project is extraordinarily complex. Nonetheless there are many 
complex DOE/EM and NNSA facilities presenting many challenges 
both from a technical and a programmatic perspective.
    The immediate assumption of authority over potentially 
hundreds of such complex DOE/EM and NNSA facilities would 
likely overwhelm our staff and put at risk the progress we have 
made in regulatory initiatives affecting our current licensees.
    Accordingly the Commission respectfully urges the committee 
to consider the phased approach to external regulation of DOE 
advocated in 1996 by DOE's own Working Group on External 
Regulation. We would see an overall gain in public health and 
safety only if NRC regulation of DOE were undertaken in a 
manner that does not risk diverting the Commission's attention 
from NRC's primary mission of ensuring the safety and security 
of civilian nuclear facilities.
    As I stated at the outset, we believe that a majority of 
the technical, policy and regulatory issues identified during 
the NRC-DOE pilot program can be adequately resolved within the 
existing NRC regulatory framework. Others will require 
clarification in statute. We would be pleased to work with the 
committee on these provisions.
    In conclusion, we appreciate the confidence that this 
subcommittee has demonstrated in NRC by introducing H.R. 3907. 
We support the bill in spirit but strongly believe that a 
phased approach focusing on the less complex and less costly 
DOE facilities should be the first step. We stand ready to work 
with the committee to identify an appropriately phased 
approach. Thank you.
    [The prepared statement of Hon. Richard A. Meserve 
follows:]
   Prepared Statement of Richard A. Meserve, Chairman, U.S. Nuclear 
                         Regulatory Commission
    Mr. Chairman and Members of the Subcommittee: It is a pleasure to 
appear before you today to discuss the proposal for external regulation 
of facilities owned or operated by the Department of Energy, and in 
particular to explain the Commission's views on the recently introduced 
bill, H.R. 3907, ``External Regulation of the Department of Energy 
Act.'' As the Commission previously testified before the House Science 
Committee's Subcommittee on Energy and Environment on July 22, 1999, 
and before the House Commerce Committee's Subcommittee on Energy and 
Power on May 20, 1998, the Commission believes that NRC could be the 
sole external regulator of DOE nuclear and radiological safety, if the 
Congress determined that such regulation was in the best interests of 
the Nation. The Commission also testified that we believe that a 
majority of the technical, policy, and regulatory issues identified 
during the NRC/DOE pilot program at three DOE facilities can be 
adequately resolved within the existing NRC regulatory framework. We 
see a path to resolving the remaining issues and we continue to stand 
by our previous testimony.
    Today we are testifying on a significantly different approach than 
that discussed in previous Commission testimony. H.R. 3907 would 
require the NRC to assume regulatory jurisdiction over the entirety of 
DOE's activities--both defense and non-defense--at one time. The 
Commission strongly prefers a multi-phased approach, as former Chairman 
Dicus testified to the House Science Committee in July of last year. 
Exactly such a multi-phased approach was contemplated by the House 
Science Committee last fall in Section 15 of H.R. 1656.
    Our concern is that a one-phase approach could divert significant 
agency resources from important ongoing regulatory initiatives relating 
to current NRC licensees. These initiatives, in areas such as license 
renewal, license transfers, a new reactor oversight process, a more 
effective license amendment process, and dry cask storage for spent 
nuclear fuel, have been urged by Congress and require significant 
agency resources to bring to fruition. NRC previously testified that it 
could initially regulate the relatively less complex, less costly 
facilities of DOE's Office of Energy Research, now the Office of 
Science (SC), and Office of Nuclear Energy, now the Office of Nuclear 
Energy, Science, and Technology (NE)--and that, subject to receiving 
adequate resources, it could then gradually phase in the more complex, 
more costly facilities of DOE's Office of Environmental Management (EM) 
and the National Nuclear Security Administration (NNSA) over a period 
of several years. Assuming responsibility for all DOE nuclear 
facilities at one time could overwhelm the agency and place at risk the 
critical regulatory initiatives currently underway. Thus, the 
Commission does not believe that the approach described in H.R. 3907 is 
feasible, even if significant resources were made available. Indeed, 
aside from the SC and NE facilities, at this point we would have a very 
hard time estimating the necessary NRC resources without further study.
    Let me give you an example of the cost associated with a very 
complex facility. The NRC now provides regulatory advice to the DOE 
concerning DOE's Hanford Tank Waste Remediation Systems project. This 
effort includes a resident inspector, who is on site full time, and 
significant involvement both by our Headquarters staff and our Center 
for Nuclear Waste Regulatory Analyses in Texas. There is no prospect 
for an NRC regulatory role until at least 2015 under DOE's current 
program, yet NRC's current assistance is costing about $2.4 million 
each year. The Hanford project is extraordinarily complex. Nonetheless, 
there are many complex DOE EM and NNSA facilities presenting many 
challenges, both from a technical and programmatic perspective. Without 
a transition period and phased approach, we would have great difficulty 
estimating the likely NRC resources required. The immediate assumption 
of authority over potentially hundreds of such complex DOE EM and NNSA 
facilities would likely overwhelm our staff and put at risk the 
progress we have made in regulatory initiatives affecting our current 
licensees.
    The Commission respectfully urges the Committee to consider the 
phased approach to external regulation of DOE advocated in 1996 by 
DOE's Working Group on External Regulation. We would see an overall 
gain in public health and safety only if NRC regulation of DOE were 
undertaken in a manner that does not risk diverting the Commission's 
attention from the NRC's primary mission of ensuring the safety and 
security of civilian nuclear facilities.
    Another issue which is not addressed in the bill is NRC's authority 
to regulate safeguards--that is, physical protection and material 
control and accounting. We believe that these matters are so integrally 
linked to safety issues that it is important for the effectiveness of 
NRC's regulatory oversight that safeguards authority be explicitly 
included.
    As I stated at the outset, we believe that a majority of the 
technical, policy, and regulatory issues identified during the NRC/DOE 
pilot program can be adequately resolved within the existing NRC 
regulatory framework. Others will require clarification in statute. We 
would be pleased to work with the Committee on these provisions.
    In conclusion, we appreciate the confidence that this Committee has 
demonstrated in NRC by introducing H.R. 3907. We support the bill in 
spirit, but strongly believe that a phased approach focusing on the 
less complex and less costly DOE SC and NE facilities should be the 
first step. We stand ready to work with the Committee to identify an 
appropriately phased approach.
    Thank you Mr. Chairman. We would be pleased to answer any questions 
that you and Members of the Subcommittee may have.

    Mrs. Wilson [presiding]. Thank you. I understand the other 
Commissioners are here for answering of questions and so we 
will turn to the Honorable Jerold Mande, Deputy Assistant 
Secretary for Labor Occupational Safety and Health 
Administration--can you fit that on a business card?
    Mr. Mande. No. It's tough. It's hard to read then.
    Mrs. Wilson. Thank you.

                STATEMENT OF HON. JEROLD R. MANDE

    Mr. Mande. Madam Chairman, members of the subcommittee, 
thank you for the opportunity to testify this morning on the 
important issue of external regulation of worker health and 
safety for private sector employees at work sites owned or 
operated by the Department of Energy.
    This issue is of great interest and importance to OSHA in 
keeping with our mission to assure that every working man and 
woman in the Nation is provided with safe and healthful working 
conditions. We appreciate your keen interest in this matter.
    OSHA has undertaken a number of cooperative projects with 
DOE to better understand the effect of external regulation on 
worker safety. OSHA has completed two recent major pilot 
projects at DOE sites. In the summer of 1998 OSHA conducted a 
large scale pilot at Oak Ridge, Tennessee, and in January 1999 
OSHA conducted a pilot project at the Lawrence Berkeley 
National Laboratory in California as part of an ongoing NRC 
pilot project at the Berkeley site.
    OSHA had three objectives for the pilot projects--one, to 
better assess the nature and severity of the site hazards as 
well as assess the adequacy of OSHA's standards, training and 
staff expertise to address them; two, to assess the potential 
impacts of external regulation on the agencies involved and 
approximate what would occur on an actual OSHA visit under 
external regulatory authority; and three, to provide a forum 
for OSHA and NRC to evaluate regulatory interface issues at the 
DOE sites.
    At both sites OSHA conducted simulated inspections that 
included opening and closing conferences with employers and 
employees, physical walk-throughs of the work sites to identify 
hazards and the preparation and simulation of citations and 
proposed penalties. OSHA prepared simulated citations and 
proposed penalties for the University of California, the site 
contractor and for DOE, the facility owner, even though OSHA 
does not currently have legislative authority to enforce 
penalties against state or Federal entities. It has been OSHA's 
experience however that worker safety and health are best 
protected when OSHA has the ability to fine both the facility 
owner, who controls the work site, and the contractors working 
at the site.
    So what did OSHA learn from its pilot activities? Our 
overall conclusion is that there are a number of legislative 
policy, logistical, and resource issues that must be addressed 
for external regulation to be accomplished in an orderly 
manner. However, OSHA believes none of the problems and issues 
is insurmountable and with careful and coordinated planning 
within the Administration and with Congress external regulation 
of DOE sites for occupational safety and health is in our 
opinion an achievable objective.
    The pilot projects demonstrated clearly to OSHA that 
external regulation would have a significant impact on DOE's 
current operating practices. Today DOE identifies hazards, 
often only takes appropriate interim measures and then attempts 
to obtain funding to address the hazard's permanence. When the 
funding does not materialize, it results in a growing backlog 
of unabated hazards.
    The OSHA-simulated inspections identified 75 violations at 
Oak Ridge and 62 at Berkeley. This number of violations is 
slightly higher than average. Injury and illness rates were 
also above the national average at these sites. OSHA's review 
of the site safety and health programs revealed that DOE and 
its contractors have implemented generally good worker safety 
and health programs, although the pilots did not find the level 
of employee involvement in safety and health issues that OSHA 
would expect to find in an excellent safety and health program.
    Madam Chairman, you have asked for comments on three 
bills--H.R. 3383, H.R. 3906, and H.R. 3907. We have no comment 
on H.R. 3383 and 3906, because neither bill appears to impact 
OSHA's program.
    H.R. 3907, on the other hand, would significantly impact 
OSHA. It would transfer to OSHA from DOE regulatory and 
enforcement responsibilities relating to matters covered by the 
Occupational Safety and Health Act with regard to all 
facilities owned or operated by DOE. OSHA and NRC would be 
required to enter into a Memorandum of Understanding that would 
govern the exercise of our respective authorities over nuclear 
safety and occupational health and safety at DOE owned or 
operated facilities and transmit that memorandum to Congress by 
January 1, 2001. The overall effective date for the transfer of 
authority to OSHA from DOE would be October 1, 2001.
    OSHA believes that external regulation proposals should be 
evaluated based on their likely impact on worker safety. As I 
have presented in my testimony, we have been working with DOE 
and NRC through pilot projects and other activities to gain a 
better understanding about the implications of external 
regulation on worker safety and on OSHA's existing programs and 
resources.
    At this time in light of the numerous unresolved issues 
associated with the transition to external safety regulation, 
we are not yet prepared to take a position on H.R. 3907.
    In closing, Madam Chairman, it is our view that OSHA 
regulation of occupational safety and health at DOE sites 
should be authorized only if such action would lead to better 
protection for workers. A number of studies and advisory groups 
have in fact concluded that employees would benefit from 
external regulation of occupational safety and health.
    The recent pilot projects have reinforced our position that 
external regulation is an achievable objective, but OSHA is not 
seeking the additional responsibility for enforcement at DOE 
sites. The agency has for several years undertaken a variety of 
cooperative projects and activities with DOE to prepare for 
external regulation. We must reiterate our caution, however, 
that if the transition is to be successful, it must be 
conducted in an orderly way with reasonable timeframes to avoid 
unnecessary disruption to OSHA's other important ongoing 
programs and resource requirements, a need to be carefully 
assessed. Thank you.
    [The prepared statement of Hon. Jerold R. Mande follows:]
 Prepared Statement of Jerold R. Mande, Deputy Assistant Secretary of 
                Labor for Occupational Safety and Health
    Mr. Chairman, Members of the Subcommittee: Thank you for the 
opportunity to testify this morning on the important issue of external 
regulation of worker safety and health for private-sector employees at 
facilities owned or operated by the Department of Energy. This issue is 
of great interest and importance to the Occupational Safety and Health 
Administration in view of the Department of Labor's mission to assure 
that every working man and woman in the Nation is provided with safe 
and healthful working conditions. We therefore appreciate your keen 
interest in this matter.
    OSHA has undertaken a number of cooperative projects with DOE to 
better understand the effect of external regulation on worker safety. 
Before I discuss those with you, however, I want to briefly describe 
OSHA's legislative authority at DOE facilities, and to summarize some 
of major events and reports on external regulation.
OSHA Jurisdiction at DOE Sites
    Section 4(b)(1) of the Occupational Safety and Health Act of 1970 
(OSH Act) removes from OSHA's coverage working conditions for which 
another Federal agency (or State agency acting under the Atomic Energy 
Act) has prescribed or enforced safety and health regulation. This 
exemption is designed to prevent the duplication of Federal effort. The 
section 4(b)(1) exemption currently applies to DOE.
    Most of the workers at DOE sites are employees of private-sector 
companies with which DOE contracts or subcontracts. These private 
employers are exempt from OSHA enforcement, because DOE has chosen to 
prescribe its own safety and health requirements. This was also the 
case with DOE's predecessor agencies, the Atomic Energy Commission and 
the Energy Research and Development Administration.
    In any discussion of external regulation, OSHA is particularly 
concerned to ensure that the level of protection we would provide is 
equal to or greater than that now provided under DOE coverage. DOE has 
adopted most of OSHA's regulations as the foundation for its own 
regulatory programs, so many of the substantive safety and health 
requirements for DOE contractors are the same as they would be under 
OSHA. However, in addition to adopting OSHA regulations, DOE has 
developed some occupational safety and health regulations of its own, 
such as more up-to-date radiation and chemical exposure standards, as 
well as firearm and explosives safety standards. If OSHA were to assume 
authority at DOE facilities, we would need to adopt similar 
requirements so that employee protection would not be diminished. It is 
important to understand that even if OSHA becomes the external 
regulator of worker safety and health at DOE sites, that does not make 
OSHA the manager of safety and health at the DOE sites. Under the OSH 
Act, the primary compliance responsibility still rests with the 
contractors and subcontractors, and, to some extent, with DOE as the 
site owner, to provide safe and healthful workplaces and to comply with 
OSHA's regulations and standards.
Background on External Regulation
    OSHA's interaction with DOE has increased since the early 1990s, 
when OSHA was engaged in a number of so-called ``Tiger Team'' reviews 
of DOE sites. In 1995, the DOE Advisory Committee on External 
Regulation of Department of Energy Nuclear Safety issued its report 
entitled ``Improving Regulation of Safety at DOE Nuclear Facilities.'' 
The report concluded that, although DOE could regulate its own 
operations, it was not viewed by the public as credible, and therefore 
recommended the creation of a system of external regulation. 
Specifically, the Advisory Committee noted that OSHA should regulate 
all worker protection issues at DOE nuclear facilities, except when 
that regulation would significantly interfere with maintaining facility 
safety (e.g., if a nuclear chain reaction was possible.) In such cases, 
the Advisory Committee recommended that the designated nuclear facility 
safety agency, such as the Nuclear Regulatory Commission (NRC) or the 
Defense Nuclear Facilities Safety Board, should regulate worker safety 
and health issues under the Atomic Energy Act (AEA).
    A subsequent DOE working group reviewed the Advisory Committee's 
recommendations and concurred with their findings on a number of 
issues, including those regarding OSHA. Another report, issued in 1997 
by the National Academy of Public Administration, also concluded that 
OSHA should have jurisdiction for occupational safety and health, and 
made recommendations on a host of policy and implementation issues that 
would need to be addressed to effect this transfer.
    The Department of Labor and OSHA have previously stated that 
external regulation, if authorized, needs to be done in an orderly way 
with reasonable time frames. Transition must be implemented without 
disruption to OSHA's ongoing programs, and the resource requirements to 
address this responsibility need to be assessed.
OSHA/DOE Pilot Projects
    OSHA has completed three major pilot projects at DOE sites. In 
1996, we completed a pilot project at Argonne National Laboratory. More 
recently, in 1998, OSHA conducted a large scale pilot at Oak Ridge, 
Tennessee, which included both the Oak Ridge National Laboratory and 
the East Tennessee Technology Park, formerly known as the K-25 site.
    In January, 1999, OSHA conducted a pilot project at the Lawrence 
Berkeley National Laboratory in California. The OSHA activities under 
the Berkeley pilot project were incorporated into an ongoing N RC pilot 
project that had been underway at the Berkeley site for approximately 
one year. Representatives of Cal-OSHA, the OSHA-approved California 
state occupational safety and health program, also participated in the 
Berkeley pilot project.
    OSHA had three objectives for the recent pilot projects:

1. to gain first hand information about both sites, in order to better 
        assess the nature and severity of the hazards, as well as 
        assess the adequacy of OSHA's standards, training, and staff 
        expertise to address them;
2. to assess the potential impacts of external regulation on the 
        agencies involved and approximate what would occur on an actual 
        OSHA visit under external regulatory authority; and
3. to provide a forum for OSHA and NRC to evaluate regulatory interface 
        issues at DOE sites, since both agencies have a potential role 
        in radiation safety at the sites.
    OSHA inspected only 16 individual facilities at Oak Ridge and 
Berkeley. The two pilot sites were far too large for OSHA to attempt 
wall-to-wall inspections of all the individual buildings and facilities 
at the two sites. Thus, we selected a representative mix of operations 
to inspect.
    At both Oak Ridge and Berkeley, OSHA conducted simulated 
inspections to study the potential impacts of external regulation. 
These simulated inspections, like actual OSHA inspections, included:

 opening and closing conferences with employers and employees,
 physical walk-throughs of the work sites to identify hazards, 
        and
 the preparation of simulated citations and penalties.
    OSHA also conducted post-inspection informal conferences with DOE 
contractor employers and workers to discuss cited hazards, simulated 
citations and penalties, abatement methods and time frames, and other 
items regarding the inspection.
    OSHA prepared simulated citations and proposed penalties for the 
University of California, the site contractor, even though OSHA does 
not currently have legislative authority to enforce penalties against 
State governments and their subdivisions. OSHA also prepared simulated 
citations and proposed penalties for DOE, the facility owner, even 
though OSHA does not currently have legislative authority to enforce 
penalties against federal agencies such as DOE. I would note, Mr. 
Chairman, that it has been OSHA's experience that worker's safety and 
health are best protected when OSHA has the ability to fine both the 
facility owner who controls the worksite and contractors working at the 
site.
    OSHA also evaluated the safety and health programs at the two 
sites. A site's safety and health program is a good measure of 
management's commitment and employees' involvement in safety and health 
matters at the site. These evaluations were designed to determine 
whether DOE contractors have effective systems in place to identify and 
control hazards, record safety and health problems, and train 
employees.
    So, what did OSHA learn from its participation in these pilot 
activities? Our overall conclusion from both the Oak Ridge and Berkeley 
pilots is that there are a number of legislative policy, logistical, 
and resource issues that must be addressed for external regulation to 
be accomplished in an orderly manner. However, none of the problems or 
issues is viewed as insurmountable; and with careful and coordinated 
planning within the Administration and with Congress, external 
regulation of DOE sites for occupational safety and health is an 
achievable objective.
    The pilot projects demonstrated clearly to OSHA that external 
regulation would have a significant impact on DOE's current operating 
practices due to the existence of legacy hazards. Legacy hazards are 
site hazards that have been self-identified by DOE, but not corrected 
because of budget constraints. Limitations on available budgetary 
resources lead DOE to prioritize its treatment of identified hazards 
based on their potential severity and likelihood of occurrence. When 
DOE first identifies hazards, it may not be able to correct them right 
away. Rather, it will prioritize the hazards, take appropriate interim 
measures, and then attempt to obtain full funding to fully address the 
hazards permanently. Until DOE eliminates such hazards, they are known 
as ``legacy hazards.''
    Any move toward external regulation must include a careful 
assessment of these legacy hazards, and a plan for abating them. The 
cost of correcting legacy hazards is likely to be significant, but it 
is important to recognize that these hazards need to be addressed 
independent of external regulation and thus should not be considered a 
cost of external regulation by OSHA.
    The pilot projects also highlighted the fact that OSHA and DOE 
evaluate the seriousness of safety and health hazards differently. OSHA 
found a number of hazards that DOE would consider a low priority, but 
which OSHA would classify as serious. OSHA places greater weight on the 
severity of a possible injury or illness in assessing its seriousness. 
For example, OSHA considers an electrocution hazard as serious even if 
there is a very small chance it would occur. In assessing the same 
hazard, however, DOE factors in an estimate of the probability that an 
event would occur, assigning lower priority to hazards that it believes 
are less likely to occur.
    The OSHA-simulated inspections identified 75 violations at Oak 
Ridge and 62 at Berkeley. This number of violations is slightly higher 
than average for an OSHA inspection. OSHA classified many of the 
violations as serious.
    OSHA also evaluated the adequacy of its own standards. The majority 
of hazards found at DOE sites are addressed by existing OSHA standards 
and requirements. A principal exception is the OSHA standard for 
ionizing radiation, which needs to be upgraded. Another area where OSHA 
may need to work on a new standard for DOE sites is Firearms and 
Explosives, which are not specifically addressed by current OSHA 
regulations.
    OSHA's review of the sites' safety and health programs revealed 
that DOE and its contractors have implemented generally good worker 
safety and health programs. However, both pilot sites could be 
improved. For example, based on OSHA's abbreviated analysis, we do not 
believe either site would be eligible for participation in OSHA's 
Voluntary Protection Program. VPP participants are a select group of 
facilities that have designed and implemented outstanding health and 
safety programs.
    Key to an excellent safety and health program is employee 
participation. The pilots did not find the level of employee 
involvement in safety and health issues at these research-related 
facilities that OSHA would expect to find in an excellent safety and 
health program. Workers were engaged to a degree, but in general, 
occupational safety and health is not as integral a part of the site 
work as OSHA would require under VPP.
    Other areas OSHA identified as needing improvement include: record 
keeping discrepancies and the increased integration of subcontractors 
into the safety and health program at Oak Ridge, and the need for a 
stronger, more visible industrial hygiene program at Berkeley. Injury 
and illness rates at Oak Ridge and Berkeley were also above the 
national average.
Funding for Pilot Projects and Other Activities
    As you know Mr. Chairman, in Fiscal Year 1999, Congress provided 
for DOE to transfer $1 million to OSHA to conduct pilot programs and 
other activities at DOE facilities. OSHA spent a small portion of these 
funds to undertake the pilot project at Berkeley in January, 1999. In 
the absence of additional pilot projects for the remainder of the 
fiscal year, however, OSHA and DOE mutually agreed to utilize the 
remaining funds to undertake other activities that would assist us in 
preparing for external regulation.
    OSHA used the funds for three projects: development of training 
materials for OSHA compliance officers; a study of background 
information on ionizing radiation; and a comparison of OSHA's Voluntary 
Protection Program (VPP) to that implemented by DOE. We are working 
with a contractor to develop materials that will prepare our compliance 
staff to effectively deal with issues they will confront if we assume 
responsibility for DOE sites. For example, we would like to enhance the 
skills and knowledge of the agency's industrial hygienists regarding 
radiation.
    In addition, OSHA has funded a study of ionizing radiation that the 
agency could use to update our radiation safety and health standard. 
OSHA's ionizing radiation standard is out of date and needs to be 
revised. As an interim measure, OSHA has proposed that any plan for 
external regulation needs to include legislation that would allow OSHA 
to implement the current DOE or NRC rule at DOE sites as an interim 
final standard while OSHA proceeds with rulemaking on a final standard. 
This would ensure that workers at DOE sites under OSHA coverage would 
not be subject to less stringent radiation regulations under external 
regulation by OSHA, until the agency is able to produce a final rule.
    OSHA also funded an analysis of the DOE VPP program. The analysis 
is expected to highlight the unique aspects of the DOE program and 
provide OSHA a basis for developing a policy on the possible acceptance 
of DOE VPP sites into the OSHA VPP program under external regulation.
    Congress also provided for DOE to transfer $1 million in Fiscal 
Year 2000 funds to OSHA. We are currently discussing its use with DOE. 
OSHA has proposed to use the funds for full-time positions in the field 
and the National Office to deal with enforcement and related issues at 
non-Atomic Energy Act DOE sites for which OSHA currently has 
jurisdiction, and to evaluate privatized facilities for potential OSHA 
regulation.
     On July 13, 1999, Assistant Secretary Jeffress sent a letter to 
Dr. Michaels at DOE clarifying OSHA's position on safety and health 
jurisdiction at DOE-owned sites that are not regulated under the Atomic 
Energy Act. OSHA has agreed with DOE that we have jurisdiction for 
safety and health enforcement at these facilities. DOE estimates that 
more than 9,000 Federal and contract employees at dozens of sites are 
covered.
Legislation
    Mr. Chairman, you have asked for comments on three bills: H.R. 
3383, which would eliminate the exemption from civil penalties for 
nuclear safety violations by non-profit DOE contractors; H.R. 3906, 
which seeks to strengthen internal security oversight within the 
Department; and H.R. 3907, which would establish external safety 
regulation over DOE facilities. We have no comment on H.R. 3906, 
because it does not appear to impact OSHA's program. Based on our 
preliminary review, we also have no comment on H.R. 3383, since it 
applies to enforcement under the Atomic Energy Act. OSHA conducts its 
enforcement activity under the authority of the Occupational Safety and 
Health Act of 1970.
    H.R. 3907, on the other hand, would significantly impact OSHA. It 
would transfer to OSHA from DOE regulatory and enforcement 
responsibilities relating to matters covered by the Occupational Health 
and Safety Act of 1970 with regard to all facilities owned or operated 
by DOE. OSHA would share these responsibilities with NRC for workplace 
hazards that include radiological components. OSHA and NRC would be 
required to enter into a memorandum of understanding that would govern 
the exercise of our respective authorities over nuclear safety and 
occupational health and safety at DOE owned or operated facilities, and 
transmit the memorandum to Congress by January 1, 2001. The overall 
effective date for the transfer of authority to OSHA from DOE would be 
October 1, 2001.
    OSHA has not taken a position regarding the desirability of 
external regulation. Rather, the agency has engaged in pilot projects 
and other activities to gain a better understanding about the 
implications of external regulation on OSHA's program and resources. At 
this time, in light of the numerous unresolved issues associated with a 
transition to external safety regulation, the potential costs of such a 
transition to OSHA, and the short amount of time we have had to examine 
H.R. 3907, we are not yet prepared to take a position on the bill.
    One issue that requires careful review by all parties involved is 
resources. In the past OSHA has produced resource estimates for the 
assumption of safety and health jurisdiction for the DOE complex. These 
estimates need to be updated and refined based on current information 
indicating exactly what sites would be transferred. The coverage of 
defense-related activities on these sites also needs to be examined, in 
light of the broad scope of H.R. 3907. Beyond resource issues, there 
are security issues and other matters that need to be addressed.
    Finally, we note that H.R. 3907 refers to section 211 of the Energy 
Reorganization Act of 1974. On March 14, 2000, the Department of Labor 
and the Nuclear Regulatory Commission jointly transmitted proposed 
legislation to the Congress recommending that the worker protections in 
section 211 be strengthened. A copy of that transmittal is attached to 
this testimony.
Conclusion
    In closing, Mr. Chairman, it is our view that OSHA's regulation of 
occupational safety and health at DOE sites should be authorized only 
if such action would lead to better protection for workers. A number of 
studies and advisory groups have in fact concluded that employees would 
benefit from external regulation of occupational safety and health.
    The recent pilot projects have reinforced our position that 
external regulation is achievable. While OSHA is not seeking the 
additional responsibility for enforcement at DOE sites, the agency has 
for several years undertaken a variety of cooperative projects and 
activities with DOE to prepare for external regulation, including the 
recent pilot projects. We must reiterate our caution, however, that if 
the transition is to be successful, it must be conducted in an orderly 
way, with reasonable time frames to avoid unnecessary disruption to 
OSHA's other important ongoing programs, and resource requirements need 
to be assessed.
    Thank you.

    Mrs. Wilson. Thank you--and the Honorable John T. Conway, 
the Chairman of the Defense Nuclear Facilities Safety Board.

                STATEMENT OF HON. JOHN T. CONWAY

    Mr. Conway. Mrs. Wilson and Chairman Barton and other 
members of your committee, my pleasure in being with you here 
this morning is somewhat tempered with the fact that one of the 
bills you propose to make into law would do away with the 
organization I represent. So, I would call your attention to 
the fact that, I and other members of the board that are here 
with me today, the submission that we are making with regard to 
the bill and with regard to other matters that this committee 
is taking into consideration is the unanimous position of the 
board. I am a spokesperson for the board and the other members 
are here with me--Dr. Eggenberger, who is the Vice Chairman, 
Mr. Joe DiNunno, and Mrs. Jessie Hill-Roberson are here with 
me. One other member of our board is on travel previously 
arranged prior to the notice to appear here with you.
    Mr. Chairman, as I mentioned in my opening statement, my 
pleasure with being with you here this morning is somewhat 
tempered by the fact that your bill would do away with my 
organization----
    Mr. Barton. There is good news and bad news.
    Mr. Conway. Let me say this. In 1998, November 1998, on the 
request of the Congress, our board submitted to the Congress a 
very detailed report on the matter that is now before your 
committee, and that has to do with the so-called ``regulation'' 
of DOE's defense nuclear facilities.
    You mentioned earlier in your opening remarks that you will 
be considering modifications, changes to the bill as it is now 
proposed. I would direct your attention to the report that the 
board submitted to the Congress, and copies of which have been 
made available to your committee. I would suggest that it will 
be helpful, I believe, to your staff and to the members as you 
consider what, I think, is a very important matter before you.
    The statement that I presented to your committee this 
morning is pretty much of a summary of the detailed report that 
was submitted to the Congress in November 1998. I would ask 
that the summary, which has been made available to the 
committee, and the detailed report be accepted as part of the 
record.
    The analysis and what we have submitted in writing to your 
committee yesterday, in effect, reviews and summarizes the 
duties of the board and the improvements that have taken place 
within the DOE in the 10 years that our board has been in 
existence. We put in our report what we understand both DOE has 
estimated and what NRC has estimated the costs would be to have 
full regulation of DOE by NRC. As Chairman Meserve also 
mentioned this morning to you, I would suggest you take costs 
into consideration and that you, hopefully, would work with 
other Members of the Congress and particularly Appropriations 
committees in recognizing what the full costs will be both from 
the point of view of OSHA and/or the NRC to whatever extent you 
decide regulation is appropriate.
    As I pointed out in our submission yesterday, we have put 
together--we, the members of the board, have put together what 
we believe to be an elite group of technical experts. Twenty-
six percent of our technical staff have Ph.D. degrees in 
technical fields and of our technical staff, an additional 67 
percent have a Master's Degree. We have put together what we 
consider to be a very elite group.
    I and our staff--I feel that we are somewhat like the 
Marine Corps. We have an elite group. Periodically there are 
discussions or recommendations to put the Marines into the 
Department of the Army, and for the last 4 or 5 years we have 
heard various suggestions of taking our staff and putting them 
into the NRC. So, as I say, we feel a little somewhat like the 
Marine Corps, and we believe we are doing an excellent job.
    Improvements can still be made. In the testimony by the 
Department of Energy, they acknowledge the improvements that 
they believe have been credited to our board. In any event, our 
final position has not changed since our report in 1998. We do 
not believe that the argument has been sufficiently made, 
taking into consideration the various costs and the potential 
effect on our national security, but at least we'll let our 
report stand for itself and in view of the short time available 
to the members here today, I will make myself available 
obviously to respond to questions. Thank you, sir.
    [The prepared statement of Hon. John T. Conway follows:]
Prepared Statement of John T. Conway, Chairman, A.J. Eggenberger, Vice 
  Chairman, Joseph J. DiNunno, Member, John E. Mansfield, Member, and 
 Jessie Hill Roberson, Member, Defense Nuclear Facilities Safety Board
    Good morning, Mr. Chairman and Members of the Subcommittee. My name 
is John Conway. I am Chairman of the Defense Nuclear Facilities Safety 
Board.
    In your letter inviting me to testify today, several legislative 
proposals that may impact the Department of Energy's (DOE) current mode 
of operation were referenced. As an independent Executive Branch 
establishment, the Board provides advice and recommendations to the 
President and Secretary of Energy regarding public health and safety 
issues at DOE defense nuclear facilities. Therefore, I will focus my 
testimony today on legislative proposal HR 3907 to establish external 
regulation of DOE defense nuclear facilities.
                       board oversight authority
    For those who may be unfamiliar with the statute establishing the 
Defense Nuclear Facilities Safety Board (Board) in 1988, a few words 
about its nuclear safety duties and responsibilities are in order.
    Broadly speaking, the Board reviews operations, practices, and 
occurrences at DOE's defense nuclear facilities and makes 
recommendations to the Secretary of Energy as necessary to protect 
public health and safety. Upon receipt of the Recommendation, the 
Secretary must accept or reject it, in whole or in part, and then must 
prepare an implementation plan for those portions which are accepted. 
The public has a statutory right to comment upon Board recommendations 
and upon DOE's responses and implementation plans.
    To date, the Board has issued 41 sets of recommendations, 
containing 194 individual specific health and safety sub-
recommendations. The Secretary has accepted the first 40 sets of the 
Board's safety recommendations thus far, with the exception of two sub-
recommendations which currently are under reevaluation by the Board. 
The latest Board recommendation delivered to the Secretary of Energy on 
March 8, 2000, is under active consideration by DOE. The Board 
recommendations detailed in Annual Reports to Congress range from such 
topics as the need to identify and implement adequate health and safety 
standards at all DOE sites, major safety improvements needed in the 
management of high-level waste tanks at the Hanford Site in the State 
of Washington, to classified safety management issues at the Pantex 
Nuclear Weapons Plant, Texas.
    If, as a result of its reviews, the Board determines that an 
imminent or severe threat to public health or safety exists, the Board 
is required to transmit its Recommendations directly to the President, 
as well as to the Secretaries of Energy and Defense. The Board also 
assesses safety management and personnel effectiveness both within DOE 
and the various operation and management (O&M) contractor 
organizations.
    The Board has assembled a small technical staff with extensive 
backgrounds in science and engineering disciplines such as nuclear-
chemical processing, conduct of operations, general nuclear safety 
analysis, conventional and nuclear explosive technology and safety, 
nuclear weapons safety, storage of nuclear materials and nuclear 
criticality safety, and waste management. As an indication of the 
Board's technical talent, 26 percent of the technical staff hold 
degrees at the Ph.D. level and an additional 67 percent have masters 
degrees. All technical staff members except interns, possess practical 
nuclear experience gained from duty in the U.S. Navy's nuclear 
propulsion program, the nuclear weapons field, or the civilian reactor 
industry.
    The Board's enabling statute requires the Board to review and 
evaluate the content and implementation of health and safety standards, 
including DOE's Orders, Rules, and other safety requirements, relating 
to the design, construction, operation, and decommissioning of DOE's 
defense nuclear facilities. The Board must then recommend to the 
Secretary of Energy any specific measures, such as changes in the 
content and implementation of those standards, that the Board believes 
should be adopted to ensure that the public health and safety are 
adequately protected. The Board is also required to review the design 
of new defense nuclear facilities before construction begins, as well 
as modifications to older facilities, and to recommend changes 
necessary to protect health and safety. Board review and advisory 
responsibilities continue throughout the construction, testing, and 
operation of new facilities. In 1991, Congress specified that the 
Board's jurisdiction also includes safety oversight of the assembly, 
disassembly, and testing of nuclear weapons.
     Under the Atomic Energy Act, the Board is authorized to conduct 
investigations, issue subpoenas, hold public hearings, gather 
information, conduct studies, establish reporting requirements for DOE, 
and take other actions in furtherance of its review of health and 
safety issues at defense nuclear facilities. These powers of the Board 
and its staff all relate to the accomplishment of the Board's mandate 
to identify safety problems and recommend corrective actions, and then 
to ensure that DOE corrects those problems at defense nuclear 
facilities. The Secretary of Energy and contractors at defense nuclear 
facilities are required by statute to cooperate fully with the Board.
    The following excerpt from a report of the Senate Armed Services 
Committee summarizes the rationale for creating an oversight Board:
        The committee does not believe that a safety board is a panacea 
        for all DOE safety problems, or that it can in any way absolve 
        the Secretary or the Department's contractors of their 
        fundamental safety responsibilities. In fact, many witnesses 
        testified that DOE's shortcomings largely reside within the 
        Department's line management, and that there can be no 
        substitute for capable and committed line management. What the 
        Board can do is provide critical expertise, technical vigor, 
        and a sense of vigilance within the Department at all levels . 
        . . Above all, the Board must have a primary mission to 
        identify the nature and consequences of any significant 
        potential threats to public health and safety, to elevate such 
        issues to the highest levels of authority, and to inform the 
        public.
For the past 10 years, this Board has been dedicated to fulfilling the 
above stated mission.
             improvements in doe health and safety posture
    Interpreting the Board's statutory authority, the Court of Appeals 
for the District of Columbia stated that the Board is an agency with 
action forcing powers.
        The Board does considerably more than merely offer advice. It 
        conducts investigations, which ``has long been recognized as an 
        incident to legislative power'' delegated to agencies by 
        Congress. It has at its disposal the full panoply of 
        investigative powers commonly held by other agencies of 
        government. The Board formally evaluates the Energy 
        Department's standards relating to defense nuclear facilities, 
        and forces public decisions about health and safety.
    Each year the Board reports to Congress on its activities and DOE's 
progress in improving safety at defense nuclear facilities. In our 
Tenth Annual Report to Congress issued in February 2000, the Board 
noted significant progress by the DOE in upgrading its safety 
management program and practices at defense nuclear facilities. The 
record of Board accomplishments in assisting DOE in its safety 
practices attests to the efficiency of the Board's structure as 
legislated in 1988. Using its action forcing powers, the Board has been 
able to help reorient DOE's safety program and to set it on a course 
that:

 Places more reliance on standards that define good practices 
        and less reliance upon expert-based safety management;
 Makes work planning and safety planning an integrated process;
 Treats public, worker, and environmental protection as an 
        integrated process;
 Treats radioactive and nonradioactive hazards in an integrated 
        fashion in establishing controls; and
 Tailors safety measures to the hazards involved.
    In accordance with its statutory mandate, the Board has focused on 
enhanced safety management of defense nuclear activities. DOE has 
recognized the benefits of such enhancements for all of its hazardous 
activities and is extending the enhancement principles and functions 
complex-wide. This is being done without the potentially litigious and 
confrontational processes that frequently characterize adjudicatory 
proceedings under regulatory regimes.
                external regulation of doe and h.r. 3907
    While many reports have been written about external regulation, 
pilots conducted at non-defense facilities, and opinions offered on 
this subject, I must emphasize that the Board is the only external, 
independent organization that has actually conducted full-time 
technical oversight of public and worker health and safety at DOE 
defense nuclear facilities. Consequently, the Board frequently has been 
called upon by both the legislative and executive branches to share its 
collective knowledge gained from 10 years of oversight experience in 
DOE's defense nuclear facilities. In fact, the National Defense 
Authorization Act for Fiscal Year 1998 directed the Board to prepare a 
written report making recommendations to the Congress and answering 
specific questions on the pros and cons of external regulation of DOE 
defense nuclear facilities as compared to the Board's current 
independent oversight authority. We have copies of the report with us 
today and ask that the report be made part of the hearing record.
    As stated in the report, the Board found no creditable arguments, 
either on the grounds of improved safety or cost effectiveness, to 
subject the defense nuclear facilities to additional external 
regulation. On the other hand, the Board did advise of the potential 
for external regulation of nuclear safety adversely impacting our 
Nation's national security program. There is nothing that has developed 
since our 1998 report to cause the Board to modify its earlier 
findings.
                  the need for additional regulation?
    What advantages might accrue from imposing additional regulation on 
DOE? One of the previously-used arguments favoring an external 
regulator asserts that such a scheme will prevent DOE from repeating 
the environmental, safety, and health problems that occurred as a 
result of early defense nuclear production programs during the Cold War 
era. In fact, many of DOE's present environmental remediation projects 
resulted from activities that predated the Federal Facilities 
Compliance Act and regulation under a comprehensive body of 
environmental laws vigorously enforced by Federal and State agencies.
     We believe that an adequate system of checks and balances, both 
internal to DOE operations and external to DOE, has been implemented 
during the past 15 years which will effectively prevent the recurrence 
of past environmental abuses. The Department of Energy today is 
required to comply with rules and regulations issued by State and 
Federal Environmental Protection Agencies and others including the 
Occupational Health and Safety Administration, the Bureau of Mines, and 
the Department of Transportation.
    Justification for additional regulation is also based on two 
suppositions, both of which we believe to be fatally flawed:

1. That it will enhance DOE credibility with the public, and
2. That it will improve safety.
                        enhance doe credibility?
    We suggest the public's trust in DOE will not increase by setting 
up another Federal government agency here in Washington, D.C. to 
regulate its activities, whether the agency be the Defense Nuclear 
Facilities Safety Board or the U.S. Nuclear Regulatory Commission (NRC) 
or some combination of the two operating in a formal regulatory manner. 
Rather than by having more external regulation imposed upon it, DOE's 
credibility will improve by performing its responsibilities in an 
efficient and creditable manner. We believe DOE has made notable 
progress in upgrading its safety management programs and in cooperation 
and openness, particularly in the formation and utilization of local 
citizen advisory boards. Trust and credibility are developed at the 
local levels, not by layering government agencies.
    One must keep in mind that the actual work carried out by the 
Government in its nuclear weapons activities is done by contractor 
employees, not by federal employees of the DOE. It is DOE's 
responsibility to assure that the work is done safely, efficiently and 
with full compliance with the environmental laws of the Nation and its 
States. In effect, for all intents and purposes and from a practical 
point of view, the DOE ``regulates'' the individual contractors doing 
the work. DOE has the authority and power to force a site, a facility 
or particular job to be curtailed or be shut down.
    Do we need to add additional government employees of another 
government agency such as the NRC to assure that DOE government 
employees are properly enforcing government laws, safety rules and 
regulations on contractor management and workers? If so, at what 
additional cost?
                    the cost of external regulation
    In 1995, the Advisory Committee on External Regulation of DOE 
Nuclear Safety issued a report (generally referred to as the Ahearne 
Report) acknowledging that regulation would require additional startup 
costs, but asserted that savings will result from having fewer DOE 
employees assigned to environmental safety and health issues. In that 
report, the NRC advised that if it is to assume regulatory 
responsibility for DOE, the Commission would need an additional 1,100 
to 1,600 full-time employees and an increase of $150 million to $200 
million per year in its budget.
    How much of that addition in personnel and dollars cost would DOE 
save? I know of no organization, in government or in private industry, 
that reduces personnel or response costs when additional regulatory 
authorities are imposed on it. The opposite occurs. The Ahearne Report 
did not set forth how savings will accrue from its recommendation, nor 
did it specify what safety improvements will occur and how.
    While there have been many external regulation scenarios studied 
during the past six years, the subject of cost to effect an external 
regulation scheme keeps surfacing as a significant issue. For example, 
the December 1996 Report of the Department of Energy Working Group on 
External Regulation contains an estimated cost of the following 
external regulation proposal:
        All DOE nuclear facilities would transition into full 
        regulation by the Nuclear Regulatory Commission in a little 
        over 10 years. In years 1-5, all Nuclear Energy and Energy 
        Research nuclear facilities and selected Defense Program and 
        Environmental Management nuclear facilities would become 
        regulated by the Nuclear Regulatory Commission. This transition 
        would begin immediately after enabling legislation is passed. 
        Except for the selected facilities regulated by the Commission, 
        Defense Program and Environmental Management nuclear facilities 
        would continue to be regulated by the Department with oversight 
        by the Defense Nuclear Facilities Safety Board in this first 
        phase. In years 6-10, all Environmental Management nuclear 
        facilities would become regulated by the Commission and the 
        Board would maintain oversight only of Defense Program 
        facilities. After 10 years, all DOE facilities would be 
        regulated by the Commission. Remaining Board staff would merge 
        into the NRC.
     DOE's estimated costs to implement this external regulation plan 
are shown in the following table.

          Table 1--DOE's Costs to Implement External Regulation
           [Data as of December 1996--In billions of dollars]
------------------------------------------------------------------------
                                                          Best    Upper
                   Cost to Implement                      Case     Case
------------------------------------------------------------------------
Cost during the first 5 years.........................     $1.4     $1.8
Cost for year 6 thru 10...............................     $1.3     $2.5
Cost beyond 10 years..................................     $1.2     $3.1
                                                       -----------------
  Total Cost..........................................     $3.9     $7.4
------------------------------------------------------------------------

    Both of the DOE cost scenarios offered above reflect the magnitude 
of the effort and associated resources needed to implement NRC external 
regulation over all DOE nuclear facilities. The economic reality of a 
multi-billion dollar venture for this type of external regulation must 
be considered in any valid cost/benefit study. We believe that in an 
era of shrinking dollars to perform DOE's major missions--weapons 
maintenance/ stewardship and cleanup--it would not be prudent to 
transfer safety-related responsibilities into a more costly regulatory 
structure for questionable fringe benefits.
                     safety management status today
     Under its enabling statute, 42 U.S.C. Sec. 2286 et seq., the Board 
has been providing independent oversight of all nuclear activities 
impacting public and worker health and safety within DOE's defense 
nuclear facilities (i.e., nuclear weapons) complex since October 1989. 
While this oversight is not regulation per se, the Board has been 
holding DOE nuclear safety to exacting standards under the authority of 
the Atomic Energy Act through the advisory and formal recommendation 
process governed by statute.
    Through a combination of Board actions and the Department's own 
upgrade initiatives, the DOE has structured and is administering a much 
more effective safety management program than the historical program so 
frequently cited as cause for added external regulation. Board 
recommendations that have contributed to this outcome include:

 Recommendation 90-2, Design, Construction, Operation and 
        Decommissioning Standards at Certain Priority DOE Facilities. 
        This recommendation caused DOE to critically evaluate its set 
        of safety-related standards and embark upon an aggressive 
        program to improve those standards, bringing them into close 
        alignment with the applicable industry requirements. Thus far, 
        DOE has issued a comprehensive set of Policy Statements, Rules, 
        Orders, Guides, and Technical Standards defining expectations, 
        generally applicable safety requirements and acceptable safety 
        practices.
 Recommendation 93-3, Improving DOE Technical Capability in 
        Defense Nuclear Facilities Programs. This recommendation 
        addressed the technical competence of DOE in critical safety 
        positions. DOE's implementation plan in this case created the 
        first ever DOE-wide technical qualification program. DOE has 
        established qualification requirements for key personnel, and 
        acquired new ``Excepted Service'' hiring authority from 
        Congress to recruit exceptional individuals outside the regular 
        civil service framework. DOE has formed a Federal Capability 
        Review Panel, reporting to the Deputy Secretary, for 
        stimulating recruitment of highly competent individuals and 
        championing technical excellence in the staff throughout the 
        Department.
 Recommendation 95-2, Safety Management. This recommendation 
        encouraged DOE to build on the successes gained in the other 
        two efforts and develop safety management programs for its 
        defense nuclear facilities that integrated public protection, 
        worker safety, and environmental protection into the work 
        process. An implementation plan set forth by the Department in 
        1996 has been steadily and effectively pursued. All contractors 
        performing high hazard nuclear activities for the Department 
        are required by regulations and contract terms to establish and 
        operate to such a safety management system. The system is 
        marked by:
     Site-wide nuclear safety requirements, mutually agreed 
            upon by DOE and contractor(s) as applicable to the work 
            performed.
     The establishment by the contractors of manuals of 
            practices reflecting the requirements established.
     Safety planning as an integral part of work planning.
     Safety and hazards analysis with safety measures tailored 
            to the hazards of the operations involved.
     Qualification and training of personnel commensurate to 
            safety responsibilities assigned.
     Assessments and feedback for improvements performed.
 Recommendation 98-1, Integrated Safety Management. This 
        recommendation is directed at closing the loop on these safety 
        programs by strengthening DOE's ability to find and resolve 
        safety problems through its independent oversight function. A 
        formal process has been established with clear lines of 
        responsibility defined for addressing safety issues identified 
        by DOE's Office of Independent Oversight. The status of 
        corrective actions is periodically reviewed by the Chief 
        Operating Officer and responsible Program Secretarial Offices.
 Departmental initiatives to upgrade safety management have 
        included the following:
     The issuance of Policy 450.5, Line Environment, Safety and 
            Health Oversight, making self-assessments by the line 
            organizations a mainline safety responsibility and Policy 
            450.4, Safety Management System Policy, a complex-wide 
            commitment to the functions and principles of Integrated 
            Safety Management.
     Issuance of DOE N411.1-1A Safety Management Functions, 
            Responsibilities, Authorities Manual (FRAM), addressing 
            management's expectations of staff assigned safety 
            responsibilities.
     The establishment of a Secretarial level Safety Council 
            headed by the Deputy Secretary with membership of three 
            Secretarial Officers (EM, DP and Science) to support the 
            Deputy Secretary in establishing safety policies and 
            resolving inter-program safety-related issues and to 
            develop performance standards to be used to hold federal 
            personnel accountable for effective and timely 
            implementation of ISM.
     The establishment of the Field Management Council to 
            ensure consistent implementation of DOE policy in ES&H, 
            safeguards and security, and business management.
     The establishment of a Safety Management Integration Team 
            (SMIT), reporting to the Deputy Secretary, for coordinating 
            and driving the implementation of Integrated Safety 
            Management throughout the complex.
     The reorganization and augmentation of the enforcement 
            functions of both the independent EH Secretarial Office and 
            the Contracting Officers.
     Independent management assessments.
     The revision of Department of Energy Acquisition 
            Regulations (DEAR) to require every contractor for a major 
            acquisition involving nuclear materials to describe and 
            commit to Integrated Safety Management (ISM) in performing 
            the work. Further, the fee awards for that work are to be 
            tied to safety performance.
    The Board acknowledges that even with these upgrades to the DOE 
regulatory structure for safety management, DOE contractors have 
experienced some recent mishaps that have placed workers at risk. The 
commercial industry is not accident free, either. On the whole, 
however, the Department's safety record, complex-wide, compares well 
with other hazardous industries.
       oversight of the national nuclear security administration
    The suggestion has also been made that the new, semi autonomous 
National Nuclear Security Administration (NNSA) may insulate the DOE 
defense nuclear facilities from scrutiny by environmental, safety, and 
health officials at DOE and elsewhere. As to the Defense Nuclear 
Facilities Safety Board, let me assure you that after a careful review 
of the NNSA's enabling legislation and legislative history, the Board's 
power and authority have neither been repealed nor displaced by the 
NNSA. Moreover, discussions between the Board and NNSA officials fully 
support the continued statutory jurisdiction of the Board.
    It has also been suggested that the existing environmental, safety 
and health oversight office within DOE no longer has oversight over 
NNSA activities. In September of 1998, the Board issued Recommendation 
98-1, concerning the effectiveness of the Department of Energy process 
to address and resolve the safety issues identified by its internal, 
independent oversight organization at the DOE's defense nuclear 
facilities. Specifically, the recommendation identification of specific 
weaknesses in addressing oversight functions and recommended that the 
Department make improvements to identify roles and responsibilities, 
issue/dispute resolution, senior management involvement, content of 
corrective action plans, tracking reporting, and verification 
approaches.
    The central safety issue identified by the recommendation was that 
the Department needed a clearer, comprehensive, and systematic process 
to address and resolve environment, safety and health issues identified 
by the DOE's internal Office of Oversight. To implement this 
recommendation, the Secretary of Energy committed to take the following 
actions:

 Establish a consistent, disciplined process and clear roles, 
        responsibilities, and authorities for developing and 
        implementing responses to identified safety issues.
 Establish clear directions on the process for elevating 
        identified safety issues to higher authority for resolution, up 
        to the Office of the Secretary if necessary.
 Establish effective tracking and reporting of corrective 
        action progress.
    The Secretary's commitments under this Implementation Plan and all 
others remain in full force and effect. Again, let me emphasize that 
neither the Secretary's commitment to implement internal oversight 
findings nor the Board's continuing oversight of the DOE's defense 
nuclear facilities have been repealed or displaced by the legislation 
creating NNSA. We are still very much in business.
               impact of regulation on national security
    The most serious problem with any external nuclear regulation of 
DOE's defense program would be a potential for adverse effects on 
national security.
    To regulate, with or without licensing or permitting authority, is 
to control, direct, or govern, coupled with the authority to enforce or 
penalize for violation. Regulatory control by an external agency of the 
nuclear health and safety aspects of DOE's performance of its defense 
mission could permit the regulator to shut down vital facilities, 
thereby diminishing the declared primacy of national security by 
relieving DOE of a significant portion of its responsibility for the 
nuclear weapons program.
    In establishing the form and authority of the Board, Congress 
deliberated on the matter of oversight versus regulation. While wishing 
to ensure better environmental, health, and safety protection than 
historically provided in weapons production, Congress elected the non-
regulatory option. National security was an important consideration. 
Although there are those who are opposed to the nuclear weapons program 
and are concerned about proliferation, Congress and the Administration 
still consider our nuclear weapons program as essential to the national 
security of this Country and our allies. It is essential that its 
deterrent objective not be put into question.
    This was ably and successfully explained by government lawyers in 
the case of the Natural Resources Defense Council versus the Secretary 
of Energy, in the Federal District Court for the District of Columbia 
(NRDC v. Pena, 972 F. Supp. 9 (D.D.C. 1997)). Together with emphasizing 
the critical importance of the nuclear weapons program to national 
security, the court cited ``credibility'' as an important ingredient of 
national security, stating that the existence of the nuclear deterrent 
had to be believable and that credibility ``depends in large part on 
the effective and successful'' conduct of the weapons program. The 
court stressed that even a brief disruption of the program would create 
a vulnerability and that ``any such vulnerability--and any future 
reduction in the credibility of our nuclear deterrent for even a brief 
period of time--would be unacceptable . . . Any doubt over the 
credibility of our nuclear deterrent would create unacceptable risks in 
the event of a future crisis . . .'' The court also contended that any 
delay in the conduct of DOE's weapons program ``could have serious 
national security implications.''
    Delay is a commonly encountered consequence of the regulatory 
process. The Atomic Energy Act and the Administrative Procedure Act 
require a nuclear regulatory agency to adhere to a formalized process 
that can result in adversarial hearings, administrative reviews, and an 
opportunity for judicial appeals such that private and special interest 
intervener are accommodated. Licensing arenas are often battlegrounds 
over legal processes rather than substantive nuclear health and safety 
issues, and often result in extensive delays.
    Note that the Board is not a regulatory body. It cannot control, 
direct, or govern any function, or interfere with the paramount 
national security mission. In creating the Board, Congress specifically 
chose not to establish another regulatory agency. The choice of 
oversight rather than regulation reflected a careful balancing by 
Congress of national security interests with the various methods for 
promoting improvements in safety at DOE facilities. This is fully 
consistent with preserving the semi-autonomous nature of NNSA by 
preserving the responsibilities of the Secretary of Energy under the 
Atomic Energy Act
    The usual enforcement powers of regulators, e.g., denial of license 
and fines, are not appropriate for DOE defense activities. Denial of 
licenses would stop critical national security activities, and fining 
DOE would merely transfer appropriations away from the safety 
activities the public is concerned about, thereby making operations 
potentially more risky and cleanup activities further delayed.
    Regulating agencies in general were intentionally chartered to have 
no stake in the success of the regulated enterprise. In fact, they can 
and do use the threat of shutting down the enterprise to enforce their 
goals. But the nuclear weapons program is an inherently governmental 
function. The notion that in contentious adversarial proceedings an 
external regulator could decide whether DOE may have a license or 
certificate to build or operate a nuclear weapons facility gives the 
regulator a ready tool to overrule the President and Congress on an 
issue of national security.
                               conclusion
    As a direct result of DOE's improved self regulation, coupled with 
the Board's independent external oversight, DOE's safety and 
environmental protection programs at defense nuclear facilities during 
the past decade have been marked by considerable improvement, increased 
effectiveness, and minimal disruption to national security missions. 
The priority that may have been accorded to mission objectives in the 
past has given way to a DOE management philosophy that stresses doing 
work safely while competently.
    Sections 2 and 3 of H.R., 3907 would deprive the Department of 
Energy of its enforcement authority with respect to nuclear safety 
which would be assumed by a regulator, the Nuclear Regulatory 
Commission, an agency with no responsibility for the security mission. 
Regulation by itself cannot assure safety is a maxim long known by 
those experienced in hazardous occupations. No outside authority or 
organization can be an effective substitute for a competent and 
dedicated internal safety organization.
    Based on available information and the individual experiences of 
Board Members, we conclude that Congress made the correct decision in 
1988 when it adopted the recommendation of the Senate Committee on 
Armed Services for national security reasons to maintain responsibility 
for nuclear safety of DOE defense activities with the Secretary of 
Energy and to establish the Defense Nuclear Facilities Safety Board as 
an independent advisory agency and not as a regulator.

    Mr. Barton. Thank you. Thank you, Mr. Conway.
    The Chair will now recognize--Mr. Mande, did you get to 
give your testimony?
    Mr. Mande. Yes, I did.
    Mr. Barton. And Mr. Meserve, you got to give your 
testimony?
    Mr. Meserve. Yes.
    Mr. Barton. Okay. The Chair recognizes himself now for 
questions.
    My first question is to Mr. Mande. Am I saying that right, 
by the way?
    Mr. Mande. The ``e'' is actually silent; it is Mr. Mande.
    Mr. Barton. Mande.
    Mr. Mande. Thank you.
    Mr. Barton. Well, that is even easier for me. One syllable 
words are much easier than two.
    I want to thank you for your constructive testimony. While 
my friends at DOE and the policy board talk about the 
insurmountable problems, you are pretty straightforward that 
you think you could do it, and I want to appreciate your 
positiveness.
    Could you elaborate a little bit on the experience that 
OSHA has had with the pilot projects where you believe that you 
could have significant gains in terms of protecting worker 
safety if we had external regulation of DOE?
    Mr. Mande. Certainly, Mr. Chairman. As you know, we have 
done three pilots over 5 years, two of them recently.
    In those pilots we were not able to do the full wall-to-
wall inspection of the site that we normally do because of the 
site size, but we were able to look at a considerable part of 
these sites and look at the activities that were taking place.
    One concern that we identified is that today when DOE 
identifies a problem, it does what it can under its existing 
resources to see that that problem has some type of interim 
fix, but often the final fix to the problem must be put off 
until DOE is able to seek and get additional funds. If those 
funds are not forthcoming, which has happened in many 
instances, the hazards become backlogged and abatement does not 
occur.
    Under OSHA rules, when there is a hazard and workers' 
health and safety is put at danger that hazard needs to be 
addressed and fixed within a very short timeframe so that 
workers are protected. That is one of the major examples of 
what would be different between how we work and how DOE works 
and it would improve worker safety.
    Mr. Barton. Good. Chairman Meserve, you were not quite as 
positive in your testimony, but you did think it could be done 
if we took a phased approach. Could you elaborate a little bit 
on that and how soon you think the NRC could implement some of 
the external regulation at certain DOE facilities?
    Mr. Meserve. The NRC does feel that it is prepared to 
undertake this task if the Congress were to indicate that we 
should do it. We certainly have the competence and capability 
in our organization to be of assistance in this way.
    The problem, as I indicated in my testimony, is that we 
have a lot on our plate now in dealing with our civilian 
nuclear licensees. These are very important initiatives that we 
need to continue to maintain the momentum of our activities. So 
this would be the problem with if, at one time, we were to 
undertake the entirety of regulation of DOE.
    DOE has an immense operation and it would be an immense 
burden on the NRC to undertake a regulatory role all at one 
time, so we have suggested a phased-in approach. What I would 
think might be a sensible way to proceed would be if the NRC 
were initially to gradually undertake the regulation of the 
Office of Science and NE part of DOE, which is what had 
originally been envisioned for us.
    It might take 5 years to bring that part of system fully up 
to speed--and then after 5 years we might take on some of the 
environmental management part of DOE and then after, perhaps at 
the end of a second 5-year period, start to look at the defense 
facilities.
    This is something I think that would require a lot of 
effort and planning----
    Mr. Barton. If I heard you right, you want to phase it in 
over a 10-year period?
    Mr. Meserve. That is correct, sir.
    Mr. Barton. You don't think your people are a little bit 
more open-minded than that, that they could not grasp things, 
all these high-powered educated, gung-ho, patriotic people on 
your staff? It would take them 10 years?
    Mr. Meserve. Well, let me say----
    Mr. Barton. Even Congressmen can learn faster than that.
    Mr. Meserve. As I am sure you are aware, DOE has an immense 
enterprise, and it is a very complicated enterprise.
    Mr. Barton. That is one of the problems at DOE.
    Mr. Meserve. And it is a problem for us in doing it 
quickly.
    Let me just say by way of example that we did undertake the 
regulatory responsibility over the gaseous diffusion plants. 
Congress at that time basically allowed roughly a 5-year period 
for us to develop our capacity and regulatory system to be able 
to deal with those plants, to work with the licensee, the 
certificate-holder in that case, and develop the trained, 
capable people to be able to do the job. That went smoothly but 
it was because it was a lot of work and planning was undertaken 
to enable that to go smoothly.
    Our problem is that that was just one of the DOE facilities 
and having to undertake possibly the large number of other 
facilities all at one time would pose an enormous challenge to 
us.
    Mr. Barton. Well, I believe you are more challenge-
acceptive than you give your agency credit for, but I 
appreciate your testimony.
    Mr. Meserve. I appreciate the compliment.
    Mr. Barton. I want to ask one final question to Ms. 
Sullivan before we recognize Mr. Whitfield. On H.R. 3906, which 
would have the Security Office report, in addition to the 
Secretary of Energy, directly also report to the Congress, your 
agency, your Department opposes that, and as far as staff can 
tell, the only reason that you oppose it appears to be because 
it also does report directly to the Congress.
    Is that right?
    Ms. Sullivan. I think our fundamental concern about that 
provision is that under basic separation of powers notions, the 
President and his immediate subordinates, the members of the 
Cabinet, determine what communications should be made to the 
Congress and this provision is in tension with that.
    On a practical level it creates a potentially adversarial 
relationship between the Director of the Office and the 
Secretary and the success of that Office has been that the 
Director believes that he has the full confidence and the 
direct ear of the Secretary to bring problems to his attention 
when they are identified.
    Mr. Barton. But if we showed you in law all the instances 
where there is a dual reporting, would that alleviate the 
Department's concern?
    Ms. Sullivan. I am sure there are many instances of----
    Mr. Barton. Because we have numerous----
    Ms. Sullivan. [continuing] of dual reporting. It is the 
notion of dual----
    Mr. Barton. It is the same office----
    Ms. Sullivan. [continuing] reporting focus on differences 
of view----
    Mr. Barton. We are taking what you did and putting it in 
law and the only addition that we really substantively have is 
that we require a dual report to the Congress. That--I cannot 
believe that Secretary Richardson has a problem with that.
    Ms. Sullivan. The fundamental concern is that the 
Department of Energy Organization Act gave the Secretary ample 
authority to respond promptly without legislative action to an 
immediate need to have improved oversight of security.
    Mr. Barton. And so if a future Secretary wanted to bury the 
Safety Office somewhere back down in the bureaucracy like it 
used to be, that is okay with the Clinton Administration?
    Ms. Sullivan. I think the concern is that, if a changed 
circumstance required some change that we can't now presently 
foresee because we do not know what the circumstance is, that 
by having a legislative mandate that locks one particular form 
in place that makes sense now, we would lack the flexibility to 
respond to a new and different circumstance.
    Mr. Barton. So you object to the Congress wanting to place 
an emphasis on safety and being given timely reports? That is 
your objection. You want to keep us in the dark.
    Ms. Sullivan. No.
    Mr. Barton. Keep the Secretary in the light but keep the 
Congress in the dark, so that is why you are objecting to the 
bill.
    Ms. Sullivan. I think the Congress has ample authority to 
obtain information directly from anybody it wants. What we are 
concerned about is locking into place a system that is----
    Mr. Barton. With an emphasis on safety.
    Ms. Sullivan. [continuing] working. The Office of Oversight 
focuses on security. In fact, their safety functions have been 
left in the Office of Environment, Safety and Health. The 
system is working well now and it is working well because the 
Secretary was able to create a system that he thinks he needs 
to meet the circumstances that exist now, and we believe it 
would be desirable to leave him that flexibility in the future 
to respond to changed circumstances.
    Mr. Barton. All right. Well, thank you for that.
    Mr. Whitfield, and then we will go to Mr. Sawyer.
    Mr. Whitfield. Thank you, Mr. Chairman. Ms. Sullivan, first 
of all, I apologize to all of you for coming in late. I missed 
most of your testimony.
    What is the position of the Department of Energy? Do they 
have an official position on H.R. 3907 at this time?
    Ms. Sullivan. Our position on H.R. 3907 is that we do not 
support NRC regulation of DOE facilities. The OSHA portion of 
it, our concern is the same concern that Mr. Mande identified, 
of ensuring an orderly transition.
    We believe that orderly transition is already underway. 
There are a number of DOE facilities that are already subject 
to OSHA jurisdiction, and we are adopting OSHA standards 
wherever they apply to the hazards we have at our facilities, 
and we are working closely with OSHA already.
    Mr. Whitfield. And why does the Department oppose the 
transfer of jurisdiction to NRC?
    Ms. Sullivan. After an exhaustive study through a joint 
pilot program, we identified a number of difficult 
implementation problems. The costs were far out of proportion 
to the benefits we could identify, and we are concerned that 
the phased approach that Chairman Meserve referenced, the costs 
of transitioning to the NRC for the simple facilities would 
take away from the focus on improving safety at our more 
difficult facilities.
    Mr. Whitfield. Okay, so cost is one issue that you're 
concerned about.
    Ms. Sullivan. Cost is certainly an issue.
    Mr. Whitfield. You know, the Washington Post has been 
writing a series of articles almost nonstop about the Paducah 
gaseous diffusion plant. And it's occupied a lot of our time, 
those of us who represent Paducah. And Ted Strickland 
represents Portsmouth, Ohio, the gaseous diffusion plant there.
    And in Paducah alone, the Department of Energy, through its 
subcontractors, has spent over $400 million on environment 
cleanup. The environmental aspects of that site are so 
horrendous, that the impression is that very little, if 
anything, has been accomplished there.
    And it's difficult for me to understand how you can spend 
$400 million and accomplish almost nothing from an objective 
standpoint on cleaning up all of the problems there, but still 
defend self-regulation in that area.
    Ms. Sullivan. Gaseous diffusion plants are under NRC 
regulation now. We spent $300 million moving two facilities to 
NRC regulation.
    Mr. Whitfield. The production is under NRC regulation, but 
I'm talking about the site.
    Ms. Sullivan. The legacy problems are clearly problems that 
need to be addressed. I think the Secretary, through his 
request for supplemental appropriations, has indicated the 
importance he places on addressing the newly discovered 
environmental problems.
    I'm not sure that we would agree that nothing has been 
accomplished to date. We've been working closely with EPA and 
with the Kentucky Environment Department on the cleanup of 
those sites.
    We are accelerating some of those activities in light of 
some of the newly discovered problems.
    Mr. Whitfield. I will say that Secretary Richardson has 
been responsive. DOE, over a number of years, was responsible 
for the production, as well as the offsite environmental issues 
until it was privatized a few years ago.
    Not only in Paducah--I mean, you could talk about Savannah 
River, Hanford, and a lot of other sites around the country, 
all of which face some of these same issues.
    At Paducah alone, we have over 50,000 drums of contaminated 
material just sitting out there. We have Drum Mountain. We have 
water levels that are contaminated. We have worker health 
problems there.
    And the sense is that--and I'm not saying Secretary 
Richardson, necessarily, or this Administration, because he has 
just come into office, but in the past, the Department has not 
been particularly effective through its subcontractors, at 
taking care of this issue.
    Now, I recognize that it's going to cost a lot of money, 
but I think we have to seriously consider other alternatives in 
dealing with this issue.
    Ms. Sullivan. Mr. Whitfield, on the environmental issues, 
the Department has been subject to external regulation for in 
excess of 10 years. And the problems you're identifying 
indicate that external regulation doesn't solve the very 
serious problems the Department has to deal with.
    We are making progress, but simply changing the 
jurisdiction of the regulator doesn't solve the problem. It 
take money, it takes technology, it takes sustained attention, 
which we are attempting to devote to the problems now.
    Mr. Barton. The gentleman's time has expired. If you want 
to make a concluding statement----
    Mr. Whitfield. That's okay, Mr. Chairman, I'll let Mr. 
Sawyer go ahead.
    Mr. Barton. The gentleman from Ohio is recognized for 5 
minutes.
    Mr. Sawyer. Thank you very much, Mr. Chairman. It must be a 
shocking transition to go from jury duty on the one hand, to be 
sitting here as a witness on the other, and I hope not to add 
to the difficulty of that transition.
    Let me go back, though. I think it's probably fair to say 
that everybody agrees that the DOE facilities are old, they are 
extraordinary in their hazards, and that there are operational 
and security considerations that pose some difficulty.
    But if for a moment we recognize and accept the bifurcation 
of time periods in terms of when DOE was responsible and now in 
places like Paducah and Portsmouth, in forward-looking 
oversight and regulation, that the NRC has successfully applied 
its regulations and standards to the operations of the U.S. 
Enrichment Corporation.
    Can you tell me why this works at those two places, but 
wouldn't work anywhere else?
    Ms. Sullivan. If we had all the money in the world, I think 
we would all agree that any regulatory system would work. Our 
concern is devoting the very substantial management and 
financial resources that would be required to develop a whole 
new regulatory system for NRC, because they don't have 
regulations in place that apply to the kind of facilities we 
have.
    So they either have to adopt our standards through a long 
administrative process, or create a whole new set of standards. 
NRC, when it took over regulation of the gaseous diffusion 
plants, observed that it felt that they had generally been 
operated safely.
    So, our concern is devoting enormous resources and not 
getting a substantial improvement in safety by simply changing 
who's regulating.
    Mr. Sawyer. Do you have a sense that the phased-in approach 
suggested by the NRC has promise for the future, or is your 
discomfort unabated?
    Ms. Sullivan. My principal concern about the phased-in 
approach is that the costs associated with phasing in NRC 
regulation at very simple facilities, the ones that the NRC is 
prepared to take on now, would divert resources from the more 
complex, more hazardous facilities that DOE would remain 
responsible for during the transition phase.
    We have tried over the last decade to focus our attention 
on a risk-informed basis to address the most serious risks 
first. If, instead, we devote all our attention to the easy 
ones--the facilities that NRC is proposing to take on first 
don't present safety hazards today.
    Mr. Sawyer. Mr. Meserve, can you comment on that?
    Mr. Meserve. Well, let me say that as Ms. Sullivan has 
indicated, there is an enormous range of activities that DOE 
undertakes. Some are simple, some are complicated.
    We have some experience in regulating DOE facilities in 
that we have been involved in regulating spent fuel storage, 
for example, various involvements with uranium mill tailings 
and the like.
    We've been an advisor to DOE in some very difficult 
problems they've had at Hanford with regard to their tanks.
    We have a different view than the DOE has of the costs 
associated with the pilot program. There was a report that we 
had prepared on the lessons to be learned from the pilot 
program, and I would like to submit it for the record.
    Mr. Sawyer. Would that include a detailed description of 
how you get from here to there in terms of a 10-year phase-in?
    Mr. Meserve. No, sir. We had a pilot program where we 
looked at cooperating with DOE at a time when DOE was anxious 
to have external regulation. The Advisory Committee had told 
DOE that they should have external regulation.
    It was a pilot program involving three facilities. And we--
--
    Mr. Sawyer. Well, let me ask you, is each facility so 
unique that each requires its own plan, or what do we learn 
from the pilot experience?
    Mr. Meserve. The pilot experience on the facilities we 
examined was that the issues associated with them were 
manageable, that they could be resolved.
    There are some differences in views as to what 
appropriately are costs associated with the dual regulation and 
what are costs that would have been required in the DOE system 
to bring the plants up to snuff with DOE orders, let alone NRC 
requirements.
    But basically the conclusion of the pilot program was, that 
for the facilities we examined, that this was a doable task.
    Mr. Sawyer. Thank you, Mr. Chairman. I see my time has 
expired.
    Mr. Barton. Thank you, Congressman Sawyer. Congresswoman 
Wilson?
    Mrs. Wilson. Thank you, Mr. Chairman. Mr. Conway, I don't 
know whether you've answered this question, but I wanted to ask 
it to you anyway. Can you compare or give us some kind of sense 
of the health and safety record of the nuclear reactors and the 
nuclear programs in the Department of Energy, compared to other 
scientific and nuclear operations in either government or 
industry?
    Mr. Conway. Well, if you talk about the nuclear reactors 
under the Department of Energy, you'd have to take into 
consideration, the more than 100 Naval ones. The nuclear Navy 
has a dual hat. The head of the Navy Nuclear Program also holds 
a position in DOE, and they have had an excellent record, 
obviously.
    Then if you take into consideration, the reactors that have 
been operated up at Hanford and also at Savannah River, they 
were for production, producing plutonium. And the purpose is 
not to produce electricity, although at one of them, up at 
Hanford, there was one dual purpose reactor that did produce 
electricity that went into the Bonneville Grid.
    But when you look at them from a safety point of view, 
there have been problems, as the commercial industry has had, 
but we have had no deaths whatsoever in the nuclear reactors 
operated by the DOE.
    Under the old AEC, we had one reactor experiment up at 
Idaho Falls in which three individuals were killed, one of whom 
had been a sailor assigned to a military reactor, not a nuclear 
Navy one; it was an Army reactor program.
    But I think when you study the history of the reactor 
program in the United States, it has been an excellent, 
excellent safety program, notwithstanding Three Mile Island, in 
which no one was injured, including the workers. No injured 
worker at Three Mile Island, even though it was a meltdown.
    So I think this country has an excellent record under the 
DOE, and also under its predecessors, including the Atomic 
Energy Commission.
    Mrs. Wilson. Thank you. I have a question for you, and it's 
really based on--without any disrespect to your peers, you kind 
of have a unique perspective on this, now being with the NRCC, 
but previously having spent a great deal of time looking at the 
Department of Energy and particularly at the nuclear weapons 
complex.
    I wonder, from your perspective, your unique perspective--
--
    Mr. Barton. I think you meant NRC, not NRCC. NRCC is the 
campaign committee, and I don't think he's on that.
    Mrs. Wilson. Did I say NRCC? I'm sorry. I apologize.
    Mr. Barton. Let's correct the record. She meant NRC. 
There's a big difference.
    Mrs. Wilson. I didn't want to judge you by the company you 
keep.
    From your perspective, what improvements in safety or 
health do you think would result or savings in costs, even, not 
for the early change in regulation of things that are very 
similar to what the NRC does now, but for some of the more 
unique Department of Energy operations? What's the advantage 
here?
    Mr. McGaffigan. I think the fundamental advantage comes 
from the openness of our process, and the credibility I think 
it would bring with the public.
    I think that Mr. Conway----
    Mrs. Wilson. I'm not talking about public credibility. I'm 
talking about health, safety, and cost. What's the advantage to 
making this huge organizational shift?
    Mr. McGaffigan. The facilities, as they are operated today, 
are generally okay, but they continue to have problems. People 
electrocute themselves at Los Alamos and things like that. That 
happened just before I came to the Commission.
    I think things are tolerated in the DOE system that would 
not be tolerated in an NRC system or an OSHA system. DOE has a 
tendency to postpone things.
    When the gaseous diffusion plants were certified--you heard 
the DOE General Counsel say that it cost $300 million. We 
sharply disagree with that. But there was a large amount of 
money spent, most of it to get the plants to where DOE said 
they should have been under the DOE order system.
    So the question is, do you want external oversight of DOE. 
DOE was in favor of external regulation 4 years ago. Tom 
Grumbly used to see a tremendous benefit in having the DOE 
facilities treated as if they were private sector facilities 
and held to the same sort of standards as private sector 
facilities.
    Now, that will cost money, and we can't do it all 
immediately in terms of the complex defense facilities. We 
can't do that any time soon, and we'd have to have a 
transition.
    At the end, I think you'd have a system that would have 
greater credibility because the rules would be enforced as they 
existed and as the public understood them. It wouldn't be 
orders. It wouldn't be contract provisions; there would be 
rules on the books, arrived at by this long process that the 
General Counsel talked about, and then enforced by a capable 
staff, working directly with the contractors.
    One of the issues I think you'll hear from Chuck Shank 
about later, the licensee, for the most part, would have to be 
the contractor. DOE would have to step back and allow the 
contractor to be the licensee. It could simply have contract 
clauses telling the contractor that they had to stay in NRC's 
good graces. I think you'd have a much more professional DOE 
complex if that were the case.
    Mrs. Wilson. Thank you. One last question, if I may, to Mr. 
Mande.
    Does OSHA currently oversee your inspector, have 
jurisdiction over any special access programs?
    Mr. Mande. By special access?
    Mrs. Wilson. I mean, highly classified programs.
    Mr. Mande. Let me check. I'll have to get back to you on 
that. But I think one of the issues we looked at at Oak Ridge, 
for example, was trying to inspect in a classified environment.
    [The following was received for the record:]

    Yes, we have done inspections of sites that required Q-
security clearance, which is equivalent to top-security 
clearance. However, we have not inspected any special access 
programs, which are established for safeguarding information 
over and above what would be required for a Q-claerance area.

    Mr. Mande. In the pilot, it worked fine. But because in the 
pilot, DOE knew the inspections were coming, all the 
arrangements could be made ahead of time.
    One of the concerns that we have, one of the issues that 
needs to be worked out is that OSHA's effectiveness depends on 
unannounced inspections.
    Mr. Conway. Mr. Chairman, if I may, possibly before Mr. 
Mande's time, when Admiral Watkins headed up DOE, he entered 
into a memorandum of understanding with OSHA. And myself and 
the other Board members and our staff interfaced with them, 
particularly at Rocky Flats.
    Now, that, compared with many other facilities, is what we 
would call a ``dirty,'' facility, with buildings highly 
radioactive. There are some rooms you cannot go in whatsoever.
    And when we were out at Rocky Flats, I remember very 
clearly working with the OSHA people who were out there, under 
this memorandum agreement. They were very worried. They did not 
know the nuclear area, and they indicated to the Board members 
and my staff that they were not very keen about going into some 
of those places, and I don't blame them. They had not been 
trained in that area.
    And subsequently, another Board member and myself, Joe 
DiNunno, we visited with OSHA representatives here in 
Washington to talk about it.
    They would tell us they were having a difficult time doing 
the commercial work that they were responsible for, because 
they did not have sufficient staff and not enough money from 
the appropriations.
    Mr. Barton. Congresswoman Wilson's question, I think, is 
more about security of classified information.
    Mr. Conway. And this involved also----
    Mr. Barton. As opposed to the dirtiness or the 
radioactivity.
    Mr. Conway. But also they did not get into any of the 
classified work out at Rocky Flats or elsewhere, to the best of 
my knowledge.
    Mr. Barton. But, Mr. Mande, before we go to Mr. Wynn, you 
don't have any doubt that there are staff people in your 
organization that can pass a security background check by the 
FBI; do you?
    Mr. Mande. No, many of us have done that.
    Mr. Barton. You can handle classified material, if you are 
vetted properly?
    Mr. Mande. Yes.
    Mr. Barton. Congressman Wynn for 5 minutes.
    Mr. Wynn. Thank you, Mr. Chairman. I apologize that I did 
not get the opportunity to hear the testimony, and I may be 
asking questions that you've covered. If so, please indulge me 
because I just have a couple.
    It's my understanding that there has been a dramatic drop 
in the number of security inspections. This was reported in the 
GAO study.
    I guess my first question is, is that, in fact, an accurate 
description of what has happened, and if so, why?
    Ms. Sullivan. I don't believe that that is accurate. If 
you're referring to security clearances or inspections of 
facilities----
    Mr. Wynn. Oversight inspections. So I presume that 
encompasses both.
    Ms. Sullivan. In fact, the Office of Oversight has been 
extremely active since it was reformulated by the Secretary 
last year.
    I'm not aware of any drop in its inspection activities.
    Mr. Wynn. So you say that the GAO report would be 
incorrect?
    Ms. Sullivan. I'm unfamiliar with the particular GAO report 
you're referring to. I'd want to look at it and see if we're 
thinking about different things.
    Mr. Wynn. Security oversight inspections is what's referred 
to in our notes here. Beyond that, I'm sorry I cannot say more. 
It kind of caught my aware.
    Ms. Sullivan. I'm unaware of any drop. The information that 
I have----
    Mr. Wynn. Office of Independent Oversight----
    Ms. Sullivan. Has been very active. It has been focused 
primarily on the weapons labs over the last several months 
since the security concerns of last year.
    Mr. Wynn. Prior to that, though, had there been a dropoff, 
if we go, say, over a 5-year period?
    Ms. Sullivan. I don't know the answer to that. The Office 
of Oversight previously had both safety--environment, safety, 
and security issues all within its jurisdiction.
    And so it may have focused in recent years more on the 
safety side than on the security side. As reformulated, it's 
now focusing exclusively on the security side.
    Mr. Wynn. And this reformulation occurred when?
    Ms. Sullivan. Last year.
    Mr. Wynn. Just when the problems occurred?
    Ms. Sullivan. That's correct.
    Mr. Wynn. Okay. I understand that the officers in the 
security staff have been reduced significantly; is that 
correct?
    Ms. Sullivan. Not that I'm aware of.
    Mr. Wynn. All right, I will----
    Ms. Sullivan. In the Office of Independent Oversight? I'll 
be happy to check and get back to you.
    [The following was received for the record:]

    During the mid to late 1990s, the number of Headquarters personnel 
that focused on independent oversight of safeguards and security was 
gradually reduced from approximately 32 to 17 during various cost 
reduction efforts. When the Secretary established the Office of 
Independent Oversight and Performance Assurance (OA) in May 1999 as an 
independent office focusing solely on safeguards and security and 
emergency management, DOE recognized that the number of staff needed to 
be increased. To ensure that OA would have the capability to perform 
its mission effectively, the DOE took appropriate action to add staff. 
At the time it was formed, OA had 17 safeguards and security 
professionals, including cyber security. OA currently has 42 Federal 
personnel assigned, 22 performing independent oversight functions in 
nuclear material safeguards and security. The remaining personnel 
perform independent oversight in the areas of cyber security and 
emergency management and make up the OA management and administrative 
support staff.

    Mr. Wynn. Yes, would you check.
    Ms. Sullivan. But I would be very surprised.
    Mr. Wynn. I guess, generally speaking, there is a concern 
about the degree of oversight and whether or not this office 
has basically been buried with conflicting missions, which lead 
to inadequate oversight.
    And that is certainly the suggestion, and if that's not the 
case, I would like, you know, kind of a full explanation of 
what, in fact, did happen with respect to this office.
    Because that's the subject of one the bills, 3906, which I 
understand you oppose; is that correct?
    Ms. Sullivan. We are opposed to it because we believe the 
office that the bill provides for exists, has been created by 
the Secretary in response to the recent security concerns.
    And we don't favor a legislative mandate for that, because 
we think the function is already there and working well.
    Mr. Wynn. What about the mandate to report to Congress, the 
results of oversight inspections?
    Ms. Sullivan. Our concern about that is that it has the 
potential to establish an adversarial relationship between the 
Director of the Office and the Secretary by requiring the 
Director to identify points of disagreement he has with respect 
to the Secretary's management of the Department, and we don't 
believe that's a desirable reporting format.
    Mr. Wynn. I'm concerned by that response, I have to tell 
you. If there are, in fact, problems with the management that 
this office, which is supposed to be independent, uncovers, it 
seems appropriate that they would report that to Congress.
    That doesn't necessarily have to be adversarial, but I 
obviously see how it could be. But the bottom line is, Congress 
has a right to have information about potential problems in 
this area.
    So if we're not going to have independent oversight, then 
we ought not have the office. I think we ought to have the 
office and so I think we ought to have the right to get the 
results of that office's findings.
    Ms. Sullivan. Certainly the Congress has the right to ask 
the Director of that office to come and report to the Congress 
at any time. In fact, Mr. Podonsky, the current Director of 
that office, has been before this committee, I believe, as 
recently as last week.
    I think he believes the strength of the office as it's 
presently formatted, is that the has direct access to the 
Secretary and that he can bring to the Secretary, the one who 
by law is responsible for the management of the Department most 
directly, the problems that he thinks need to be addressed. And 
he has been doing that and had very favorable supportive 
response from the Secretary.
    Mr. Wynn. Thank you. Mr. Chairman, I don't have any further 
questions.
    Mr. Barton. Thank you. We plan to try to keep the hearing 
going. Mr. Ehrlich?
    Mr. Ehrlich. I will pass, but with one caveat. I just want 
to adopt the concerns expressed by my colleague from Maryland.
    Mr. Barton. The gentlelady from Missouri, Congresswoman 
McCarthy?
    Ms. McCarthy. Thank you very much, Mr. Chairman. My major 
DOE contractor, Allied Signal, wants to move faster to address 
safety concerns and to achieve adequate oversight.
    How does the legislation we're discussing today improve 
upon the process? Anyone?
    Mr. Meserve. Well, I can comment from the perspective of 
the NRC on this. Let me say that this is not a task that we 
have asked for, but if Congress were to ask us to undertake it, 
we would do so.
    I think that as Mr. McGaffigan indicated in response to an 
earlier question, one of the benefits which I think caused 
DOE's own advisory committee to recommend that the NRC 
undertake an independent regulatory role in the Department is 
that it enable a focused examination of safety issues that 
would be undertaken independently of the other pressures that 
exist for operations. NRC offers basically a structured, 
capable system to monitor the safety of operations and assure 
that they continue.
    I would anticipate that, if the NRC were to undertake the 
responsibility at these sites, there would also be an open 
process that we would follow, just as we do at all of our 
civilian nuclear sites, so that the public would be fully 
involved, the stakeholders would be fully involved. Hopefully 
out of that would come increasing confidence that the 
operations were safe, that decisions were being made 
appropriately and that would end up basically enhancing the 
credibility of the entire activity.
    Mr. Barton. If the gentlelady would suspend, we have two 
votes on the floor instead of one, so unfortunately we are 
going to have to recess the hearing.
    I would like to get the first round of questioning done and 
be able to release this panel, so if there are members here 
that have one final question.
    Ms. Sullivan. Could I just add in response to Congresswoman 
McCarthy's question, that is not a nuclear facility at Kansas 
City. NRC would not regulate that facility. We are already 
applying OSHA standards to much of the work that goes on at 
Kansas City.
    Ms. McCarthy. So this bill will not affect them at all?
    Ms. Sullivan. It would not change much at all at Kansas 
City.
    Ms. McCarthy. Would not change much. Okay. We'll talk. 
Thanks.
    Ms. Sullivan. Thank you.
    Mr. Barton. Is that all your questions? Does Mr. Ehrlich or 
Mrs. Wilson or Mr. Sawyer have a final question for this panel?
    [No response.]
    Mr. Barton. Okay. We are going to release you. There will 
be written questions in addition to the oral questions that you 
have been given.
    The subcommittee plans to aggressively pursue changes to 
the legislation so that we can go to markup within the next 
month, so have your staffs be available for input on that.
    Thank you for your participation. This panel is released.
    We are going to take a very brief recess. We are going to 
reconvene as soon as these series of votes are over with our 
second panel. My guess is that is going to be approximately at 
12:15, so I would encourage all the panel members on the second 
panel to be available, because when I do return I am going to 
reconvene with the panel members that are here, so we are in 
recess until approximately 12:15.
    [Brief recess.]
    Mr. Barton. The subcommittee will come to order.
    We have a motion on the floor right now by Congressman 
Gibbons of Nevada on the point of order on the nuclear waste 
legislation. There will be a vote in about 20 minutes, so we 
want to start this panel and hopefully get most of your 
testimony before we have to go vote.
    We want to welcome Mrs. Jones, Associate Director, The 
Energy, Resources, and Science Issues in the GAO. We have Dr. 
Charles Shank, who is the Director of Lawrence Berkeley 
National Laboratory. We have Mr. Robert Van Ness, who is the 
Assistant Vice President for Laboratory Administration at the 
University of California. We have Ms. Maureen Eldredge, who is 
the Program Director for the Alliance for Nuclear 
Accountability. We have Dr. David Adelman, who is the Project 
Attorney for the Nuclear Program in the Natural Resources 
Defense Council. I don't see Mr. Miller.
    Mr. Cook. Mr. Chairman, Mr. Miller is over on the Senate 
side.
    Mr. Barton. Ah--but he is on his way. He is a policy 
analyst for the PACE International Union, so we are going to 
start with Mrs. Jones.
    Your testimony is in the record. We will recognize you for 
7 minutes to summarize it and then we will just go right down 
the line, then we will have questions.

   STATEMENTS OF GARY L. JONES, ASSOCIATE DIRECTOR, ENERGY, 
   RESOURCES, AND SCIENCE ISSUES, GENERAL ACCOUNTING OFFICE; 
    CHARLES V. SHANK, DIRECTOR, LAWRENCE BERKELEY NATIONAL 
 LABORATORY; ROBERT L. VAN NESS, ASSISTANT VICE PRESIDENT FOR 
 LABORATORY ADMINISTRATION, UNIVERSITY OF CALIFORNIA; MAUREEN 
       ELDREDGE, PROGRAM DIRECTOR, ALLIANCE FOR NUCLEAR 
ACCOUNTABILITY; AND DAVID E. ADELMAN, PROJECT ATTORNEY, NUCLEAR 
           PROGRAM, NATURAL RESOURCES DEFENSE COUNCIL

    Ms. Jones. Thank you, Mr. Chairman. We are pleased to be 
here today to provide our views on three bills designed to 
improve worker and nuclear facility safety as well as enhance 
security for the Department of Energy.
    H.R. 3383 would amend the Atomic Energy Act by eliminating 
the exemption that allows nonprofit contractors to avoid paying 
civil penalties for violations of nuclear safety rules. DOE 
argues that the exemption for nonprofit contractors should be 
continued. We disagree. DOE said that nonprofit contractors 
would be unwilling to put their assets at risk to pay civil 
penalties. However, nearly all of these contractors now have 
the opportunity to earn a fee, which they generally use to fund 
research that they want to do. The fee could also be used to 
pay civil penalties.
    DOE also said that contract provisions are better 
mechanisms than civil penalties for holding nonprofit 
contractors accountable. However, DOE has not taken full 
advantage of existing contracting mechanisms.
    For example, the University of California received 96 
percent of its $6.4 million available fee for managing Lawrence 
Livermore in fiscal year 1998, even though it had significant 
nuclear safety deficiencies resulting in enforcement actions. 
This bill directly addresses our suggestion to the Congress 
that it eliminate both the statutory and administrative 
exemptions from paying civil penalties for violating nuclear 
safety rules.
    H.R. 3906 legislatively establishes an office independent 
of line management that oversees security at DOE facilities and 
that reports directly to the Secretary. This office exists now 
and currently reports to the Secretary. Then why do we need 
legislation?
    The simple answer is so that the office and structure will 
be permanent and not dependent on the importance future 
Secretaries place on security. This has been a problem in the 
past. For example, the office was several layers down in the 
Environment, Safety and Health organization prior to May 1999 
and at one time was in Defense programs.
    I also wanted to clarify a point about our report on safety 
in the discussion between Mr. Wynn and Ms. Sullivan on the last 
panel. Our report noted that over a 5-year period prior to May 
1999, there were at least 3 years for one facility where the 
oversight office did not do an oversight investigation. Since 
May 1999 with the changes the Secretary initiated they have 
been doing more regular inspections.
    Legislatively establishing that office insulates it from 
organizational change and programmatic conflicts and, along 
with the annual report to the Congress, helps to ensure prompt 
corrective action is taken.
    H.R. 3907 would eliminate self-regulation of health and 
safety activities at DOE by authorizing NRC to regulate and 
enforce nuclear safety and OSHA to regulate and enforce 
occupational health and safety for all DOE facilities. This 
bill provides a sound basis for continuing the process of 
moving DOE in the direction of external regulation.
    We, along with others, have reported on DOE's weaknesses in 
its self-regulation of environment, safety and health at its 
facilities. The results of the pilot program as well as the 
extensive interactions between DOE, NRC, and OSHA over the 
years showed that external regulation offers benefits and that 
external regulators have the flexibility to adjust to unique 
DOE facility conditions.
    However, the timeframe allowed in the bill for transition 
to full external regulation may not be achievable. NRC and OSHA 
have experience with some DOE facilities and have studied 
others through the pilots. External regulation of these 
facilities, which includes small, less complex facilities and 
nondefense research laboratories, could be on a faster track. 
However, defense facilities were not included as part of the 
pilot and they are far more complex than the facilities 
studied. Therefore, more time would be needed to study issues 
such as the need to maintain security, regulatory costs, 
resource and skill needs, and transition methods.
    Mr. Chairman, while all three bills have the potential to 
improve some aspects of health, safety, and security at DOE 
facilities, legislation could only take change so far. In the 
final analysis it will require a long-term commitment by DOE, 
and quite frankly, DOE has not demonstrated the will nor has 
the culture in place to make lasting changes. DOE needs to 
focus on aspects of its culture that are barriers to 
effectively carrying out its missions in a safe, 
environmentally sound, and secure way.
    Over the years our work has noted such things as a 
complicated organizational structure, poor accountability, weak 
oversight of contractors, lack of technically skilled staff, 
and resistance to change. Without focusing on these issues, DOE 
will not be able to break out of the culture or mindset that 
permeates it. Therefore, even with the changes brought about by 
these legislative proposals, problems inherent in DOE may 
continue.
    Mr. Chairman, we look forward to working with you as you 
move to mark up these bills.
    [The prepared statement of Gary L. Jones follows:]
   Prepared Statement of Gary L. Jones, Associate Director, Energy, 
   Resources, and Science Issues, Resources, Community, and Economic 
          Development Division, U.S. General Accounting Office
    Mr. Chairman and Members of the Subcommittee: We are pleased to be 
here today to provide our views on three bills designed to improve 
worker and nuclear facility safety and health as well as to enhance 
security for the Department of Energy (DOE). Our testimony is based on 
our past work on safety, health, and security issues on a wide variety 
of DOE programs and activities.1 Let me summarize our views 
on the three bills:
---------------------------------------------------------------------------
    \1\ See Department of Energy: DOE's Nuclear Safety Enforcement 
Program Should Be Strengthened, GAO/RCED-99-146, Jun. 10, 1999). 
Nuclear Security: Improvements Needed in DOE's Safeguards and Security 
Oversight, (GAO/RCED-00-62, Feb. 24, 2000). Department of Energy: 
Uncertain Future for External Regulation of Worker and Nuclear Facility 
Safety, (GAO/T-RCED-99-255, Jul. 22, 1999). Department of Energy: Clear 
Strategy on External Regulation Needed for Worker and Nuclear Facility 
Safety, (GAO/T-RCED-98-163, May 21, 1998).

 H.R. 3383 would amend the Atomic Energy Act by eliminating the 
        exemption that currently allows certain nonprofit contractors 
        to avoid paying civil penalties if they violate DOE's nuclear 
        safety rules. Last year, we reported and testified on a number 
        of problems with DOE's enforcement of its nuclear safety 
        regulations. We suggested that the Congress consider 
        eliminating both the statutory and administrative exemptions 
        from paying civil penalties for violations of nuclear safety 
        rules. This bill directly addresses our concerns.
 H.R. 3906 would legislatively establish an office of 
        independent security oversight within DOE that reports directly 
        to the Secretary. We believe that legislatively establishing an 
        office, independent from line management, that oversees 
        safeguards and security across the Department and reports to 
        the Secretary would insulate it from organizational change and 
        programmatic conflicts. Since May 1999, DOE's security 
        oversight office has reported to the Secretary. However, prior 
        to May 1999, it was several layers down in the organization 
        and, as a result, oversight findings were not always raised to 
        top management. The legislation would also require an annual 
        report to the Congress from that office on the status of its 
        findings. Requiring an annual report would make the office's 
        findings more visible and help to ensure prompt corrective 
        actions are taken.
 H.R. 3907 would eliminate self-regulation of health and safety 
        activities at DOE by authorizing the Nuclear Regulatory 
        Commission (NRC) to regulate and enforce nuclear safety and the 
        Occupational Safety and Health Administration (OSHA) to 
        regulate and enforce occupational health and safety for all DOE 
        facilities. This bill provides a sound basis for continuing the 
        process of moving DOE in the direction of external regulation. 
        However, the time frame allowed in the bill for the transition 
        to full external regulation may not be achievable. NRC and OSHA 
        have experience with some DOE facilities--smaller, less complex 
        facilities and nondefense research laboratories. The transition 
        to NRC and OSHA regulation of these facilities could be 
        achieved relatively quickly. However, issues associated with 
        regulating larger defense facilities are more complex, such as 
        the need for experience with unique activities at weapons 
        facilities, and would take longer to evaluate and may require 
        special consideration.
    Mr. Chairman, while all three bills have the potential to improve 
some aspects of health, safety, and security at DOE facilities, 
legislation can only take change so far. In the final analysis, it will 
require a long-term commitment by DOE, and quite frankly, DOE has not 
demonstrated the will nor does it have the culture in place to make 
lasting changes. DOE needs to focus on aspects of its culture that are 
barriers to effectively carrying out its missions in a safe, 
environmentally sound, and secure way. Over the years, our work has 
noted culture barriers such as a complicated, dysfunctional 
organizational structure; an unclear chain of command; poor 
accountability for program management; weak oversight of contractors; 
lack of technically skilled staff; and resistance to change.
    DOE has made changes and has activities under way that address some 
of these issues. However, it must continue to look at human capital 
issues, such as hiring and training to improve the skills of its 
employees, the performance measures and incentives systems for 
contractors and federal employees to ensure that they reward the 
correct behaviors, and clear definition of roles and responsibilities 
to eliminate duplication and inefficiencies. Without identifying and 
focusing on the barriers to change, DOE will not be able to break out 
of the culture or mindset that permeates it. Therefore, even with the 
changes brought about by these legislative proposals, problems inherent 
in DOE may continue.
Background
    Since its creation in 1977, DOE has conducted technically complex 
and hazardous activities at its facilities across the country. These 
activities include developing, producing, maintaining, storing, and 
dismantling nuclear weapons; managing nuclear fuel storage and disposal 
sites; operating nuclear reactors; performing research and development 
to enhance energy efficiency and to develop innovative nuclear, 
renewable, and other energy sources; and cleaning up environmental 
contamination from its past weapons production. Besides being 
potentially dangerous, some of these activities are highly classified 
and require sophisticated security measures. However, in conducting 
these activities, DOE has a long history of safety, managerial and 
security problems.
    DOE is essentially exempt from regulation by NRC for nuclear safety 
and by OSHA for worker protection. These exemptions originated from 
concerns about national security that characterized DOE's historical 
role in nuclear weapons production. The facilities that this 
legislation would subject to external regulation are substantial. DOE 
maintains 3,500 nuclear facilities at 34 sites in 13 states, covering, 
in all, more than 85 million square feet of building space.
Civil Penalties for Nonprofit Contractors
    H.R. 3383 would amend the Atomic Energy Act by eliminating the 
exemption that allows certain contractors to avoid paying civil 
penalties if they violate DOE's nuclear safety rules. The Congress 
first authorized civil monetary penalties for violations of nuclear 
safety rules in 1988. This gave DOE the authority to impose civil 
monetary penalties on its contractors, and on their subcontractors and 
suppliers, for violating enforceable nuclear safety rules. However, for 
certain contractors, the Congress provided an exemption from having to 
pay the monetary penalties, primarily because the contractors operating 
DOE laboratories at the time received no fees in addition to their 
reimbursable costs and, therefore, had no contract-generated funds 
available to pay any penalties assessed. There was concern that these 
contractors might leave the research field rather than put the assets 
of their organizations at risk if they were subject to paying the 
monetary penalties. If DOE identifies violations of nuclear safety 
rules at any of the seven contractors and laboratories specifically 
named in the law, or their subcontractors and suppliers, DOE cannot 
collect the civil monetary penalty.
    The exemption from civil penalties has been extended to 
institutions that, like other contractors in the business of handling 
nuclear materials, receive financial protection or indemnification from 
the damages to people and property that may be harmed in a nuclear 
accident. The Secretary also was given the authority to determine 
whether other contractors that are nonprofit educational institutions 
should receive a similar exemption. In 1993, DOE specified by rule that 
all nonprofit educational institutions would receive an automatic 
exemption from paying the penalties.
    In a March 1999 report to the Congress concerning the 
reauthorization of the Price Anderson Act, DOE argued that the 
exemption for named contractors and nonprofit educational institutions 
should be continued.2 Our analysis of DOE's reasoning, 
however, raised several questions about the merits of continuing the 
exemption:
---------------------------------------------------------------------------
    \2\ The Price Anderson Act established a source of funds to 
compensate personal injury and property damage from a nuclear accident 
and limits liability of private industry for such accidents.

 DOE argued that universities and other nonprofit contractors 
        working at DOE facilities would be unwilling to put their 
        assets at risk for contract-related expenses such as civil 
        penalties. However, nearly all of the contractors that manage 
        and operate DOE facilities now have the opportunity to earn a 
        fee. This fee, which is in addition to reimbursed costs, is 
        used by the nonprofit contractors to cover certain 
        nonreimbursable contract costs and to conduct other laboratory 
        research. The fee could also be used to pay civil penalties if 
        they were imposed on the contractor.
 DOE said that contract provisions are a better mechanism than 
        civil penalties for holding nonprofit contractors accountable 
        for safe nuclear practices. However, DOE has not taken full 
        advantage of the existing contracting mechanisms to emphasize 
        nuclear safety. For example, at the Lawrence Livermore National 
        Laboratory in California, DOE's main contractor--the University 
        of California--received 96 percent of its $6.4 million 
        available performance fee in fiscal year 1998, even though it 
        had significant nuclear safety deficiencies resulting in 
        enforcement actions. At best, only about 4 percent of its 
        performance fee for 1999 was at risk if it did not perform 
        satisfactorily in the health and safety area.
 DOE said that its current approach of exempting nonprofit 
        institutions is consistent with NRC's treatment of nonprofit 
        organizations because DOE issues notices of violation to 
        nonprofit contractors without collecting penalties but can 
        apply financial incentives or disincentives through the 
        contract. However, NRC can and does impose monetary penalties 
        for violations of safety requirements, without regard to the 
        profit-making status of the organization. NRC sets lower 
        penalty amounts for nonprofit organizations than for-profit 
        organizations. The Secretary could do the same, but does not 
        currently take this approach. Furthermore, both NRC and other 
        regulatory agencies have assessed and collected penalties or 
        additional administrative costs from some of the same 
        organizations that DOE exempts from payment. For example, the 
        state of California assessed and collected $88,000 in 
        ``administrative costs'' from the University of California for 
        violating state environmental laws at the Lawrence Livermore 
        and Lawrence Berkeley National Laboratories.
    Our June 1999 report on DOE's nuclear safety enforcement program 
recommended that the Secretary of Energy eliminate the administrative 
exemption from paying civil penalties for violations of nuclear safety 
rules that DOE granted to nonprofit educational institutions. The 
Department did not implement the recommendation, instead commenting 
that the issue of exemption from civil penalties was ultimately one for 
the Congress to decide. We also suggested that the Congress consider 
eliminating both the statutory and administrative exemptions from 
paying civil penalties for violating nuclear safety rules. H.R. 3383 
directly addresses our recommendation.
Independent Security Oversight
    H.R. 3906 would legislatively establish an independent security 
oversight office within DOE that reports directly to the Secretary of 
Energy. We believe that legislatively establishing an office, 
independent from line management, that oversees safeguards and security 
across the Department would insulate it from organizational change and 
programmatic conflicts. It would also provide the office with the 
visibility in the organization and the authority it needs to ensure 
that security problems it identifies are corrected. Since May 1999, 
DOE's independent security office has reported to the Secretary. 
However, the director of the independent security oversight office has 
not always reported to the Secretary. Prior to May 1999, the 
independent security oversight office reported to the Office of 
Oversight, which in turn reported to the Assistant Secretary for 
Environment, Safety, and Health, who reported to the Secretary. At one 
time, the oversight office was organizationally placed in Defense 
Programs, a line-management program office. As a result of these 
organizational placements, oversight findings and recommendations were 
not always raised to top DOE management and were sometimes ignored by 
the contractors operating DOE's facilities.
    The bill also proposes, among other things, that the independent 
security oversight office conduct evaluations every 18 months and 
conduct follow-up reviews to ensure that corrective actions for 
security problems are effective. These provisions of the bill focus on 
several issues discussed in our February 2000 report on security 
oversight. For example, our report disclosed that during the mid-1990s, 
as many as 3 years elapsed between the independent security oversight 
office's inspections at DOE's nuclear weapons laboratories. In 
addition, we recommended that the oversight office work with the 
laboratories in developing corrective actions to ensure that security 
problems identified during its inspections were properly corrected. In 
recent months, the independent security oversight office has taken 
actions on these issues. However, in the past, the emphasis on security 
within DOE has varied greatly, and recent improvements may not be 
permanent fixes. Required periodic evaluations, follow-up reviews, and 
the annual report to the Congress on the status of security at DOE 
facilities, as would be required under H.R. 3906, would help to prevent 
future backsliding.
External Regulation of DOE Facilities
    H.R. 3907 would authorize NRC to regulate and enforce nuclear 
safety and OSHA to regulate and enforce occupational health and safety 
at DOE facilities. The bill would require that such regulation be 
effective by October 1, 2001. By placing DOE facilities under NRC and 
OSHA jurisdiction, the bill would continue the process of moving DOE in 
the direction of external regulation.
    The process of eliminating self-regulation began in 1984 when DOE 
facilities first came under federal environmental laws that are carried 
out and enforced by the Environmental Protection Agency and the states. 
In addition, NRC has worked with DOE to license, certify, and consult 
on many different DOE facilities. For example, NRC granted a license to 
DOE for operating the TMI-2 Independent Spent Fuel Debris Facility at 
the Department's Idaho National Engineering and Environmental 
Laboratory. It is also conducting prelicensing consultations with DOE 
in other areas, including the high-level waste repository at Yucca 
Mountain, Nevada, and a proposed facility for making mixed-oxide fuel. 
NRC and OSHA have also conducted simulated inspections at DOE 
facilities during recent pilot projects. Aside from these individual 
cases, the vast majority of DOE's facilities are not regulated for 
health and safety by independent regulators.
    We, along with others, have often reported on weaknesses in DOE's 
self-regulation of the environmental, safety, and health 
responsibilities at its facilities. These weaknesses prompted then-
Secretary of Energy Hazel O'Leary to seek external regulation for 
worker safety in 1993. In 1994, legislation was proposed and hearings 
were held on external regulation of DOE nuclear safety. In 1995, DOE 
created an advisory committee that concluded, ``Widespread 
environmental contamination at DOE facilities and the immense costs 
associated with their cleanup provide clear evidence that self-
regulation has failed.'' 3 In 1996, a subsequent DOE working 
group of senior managers concluded that external regulation could 
improve safety, eliminate the inherent conflict of interest from self-
regulation, gain consistency with current domestic and international 
safety management practices, and improve credibility and public trust. 
The advisers recommended that safety and health at DOE facilities be 
externally regulated.
---------------------------------------------------------------------------
    \3\ See Improving Regulation of Safety at DOE Nuclear Facilities, 
Advisory Committee on External Regulation of Department of Energy 
Nuclear Safety (Dec. 22, 1995).
---------------------------------------------------------------------------
    In 1997, then-Secretary Frederico Pena took a more cautious 
approach to external regulation by launching a pilot program with NRC 
and OSHA. The pilot program was limited to DOE's nondefense facilities. 
The purpose of the pilot program was to test regulatory approaches and 
gain insight about the costs of external regulation based on actual 
experience. The pilot program began in January 1998 at the Lawrence 
Berkeley National Laboratory in California and was completed in June 
1998. (OSHA completed an earlier pilot at the Argonne National 
Laboratory in Illinois in 1996.) The other NRC pilot program facilities 
were at Oak Ridge in Tennessee and Savannah River in South Carolina. 
The results of the pilot program, as well as the extensive interactions 
between DOE, NRC, and OSHA over the years, show that external 
regulation offers many potential benefits, and that external regulators 
have the flexibility to adjust to the unique conditions at DOE 
facilities.
    The current Secretary believes external regulation is not worth 
pursuing, contending that costs would likely outweigh the value of 
external regulation. His position contrasts sharply with DOE's previous 
positions promoting external regulation. His position also conflicts 
with the Department's own pilot program results and is inconsistent 
with conclusions reached by NRC and OSHA. The results of the pilot 
program and the extensive practical experience gained with NRC and OSHA 
show that external regulation for the class of facilities studied 
improves safety and accountability and is not likely to be 
prohibitively expensive.
    While the pilot program revealed no major barriers to regulating 
the class of DOE facilities studied, none of the pilot sites contained 
defense facilities. The pilot did not include DOE's three largest 
laboratories--Lawrence Livermore, Los Alamos, and Sandia--which operate 
significant defense facilities. DOE's defense facilities are far more 
complex than the pilot sites and would likely require more time to 
study issues such as the need to maintain security, regulatory costs, 
resource and skill needs, and transition methods. For the much simpler 
pilot sites, nearly a year was spent planning, conducting and reporting 
on the pilot results. DOE's Working Group on External Regulation 
recommended several years of experience be gained before bringing in 
defense sites under outside regulatory control. Also, complicating any 
transition to outside regulatory control is the examination of the role 
of the Defense Nuclear Facilities Safety Board, which currently 
oversees nuclear safety at DOE's facilities.
    Given these complexities, we believe the October 1, 2001, start up 
schedule contained in H.R. 3907 for full implementation of external 
regulation may not be achievable for DOE's defense facilities. 
Transitioning to NRC and OSHA regulation of classes of DOE facilities 
in which experience has already been gained, such as nondefense 
research laboratories, seems more workable. Then, phasing in NRC and 
OSHA regulation of DOE defense facilities could occur over a longer 
period of time.
    Mr. Chairman, as I discussed initially, all three bills have the 
potential to improve some aspect of health, safety, and security at DOE 
facilities. However, legislation can only take change so far. In the 
final analysis, it will require a long-term commitment by DOE. This 
concludes my testimony. We would be happy to respond to any questions 
that you or Members of the Subcommittee may have.

    Mr. Barton. Thank you, Mrs. Jones. We now would like to 
hear from you, Dr. Shank, for 7 minutes. Your statement is in 
the record in its entirety.

                  STATEMENT OF CHARLES V. SHANK

    Mr. Shank. Mr. Chairman and members of the subcommittee, it 
is my pleasure to be here today to give my perspective on the 
three bills dealing with environment, health, safety in the 
Department of Energy complex.
    Our laboratory is located in the hills above the University 
of California at Berkeley campus. We are often, because of our 
name of Lawrence, confused with our larger sister to the south. 
I have more than one bus with visitors arrive looking out, 
seeing the San Francisco Bay and asking could we see the Bay 
from Livermore?
    We are not the Livermore Laboratory. We are a much simpler 
laboratory. We have a budget of about $415 million and our 
primary mission responsibility is fundamental science with 
supporting missions in the environment and energy efficiency.
    The regulatory framework for national laboratories is an 
important part of their scientific productivity and important 
for the employees and important for our ability to protect the 
environment. Providing a safe and healthy environment is a 
critical responsibility for me as a Lab Director of a national 
laboratory.
    I am going to confine my remarks today on the H.R. 3907, 
which would provide for external regulation of nuclear safety 
and occupational health safety at DOE laboratories. I would 
like to talk about our experience with both the Nuclear 
Regulatory Commission and the Occupational Health and Safety 
Commission pilots and then give you some of my more general 
views about the proposed legislation.
    As you know, we are located right next to the Berkeley 
campus and for many years it has mystified me as to why 
identical activities carried on at the campus in the laboratory 
are regulated by different entities with different standards. 
As a consequence, when NRC proposed a pilot project for 
external regulation of DOE facilities I quickly volunteered our 
institution.
    My dream is for a world where work is regulated with 
uniform standards independent of the entity that performs the 
work. Scientists could be trained with a single set of 
expectations for environment, health and safety considerations 
throughout the country.
    Our NRC pilot took place in October 1997 and in January 
1998 with two planning visits and two 1-week simulated 
regulation visits. The results of the pilot were encouraging. 
NRC found that there were no significant safety findings to 
report. The laboratory had an adequate plan to protect the 
health and safety for the public, employees and the 
environment. The NRC indicated that they would be willing to 
issue our laboratory a broad scope license for operation and 
that they could carry out their responsibility for our site 
with approximately .1 FTE or approximately one person month per 
year.
    There are, however, serious concerns.
    First, would external regulation be layered on top of DOE, 
current DOE orders? We fear a world of overlapping and 
redundant responsibilities that would make it difficult for us 
to do our work.
    Who would hold the license? The DOE report on our pilot 
indicates that additional people would have to be hired if DOE 
held the license. Direct connection between the contractor and 
the regulatory agencies I think would be essential for us to be 
able to do this properly.
    And then who would be responsible for legacy issues? We at 
Berkeley have a large facility, the Bevatron, which needs to 
undergo a cleanup, and funds have not been allotted for that 
cleanup, and in the process of changing regulations it is very 
important for us that issues and legacy issues be very 
carefully considered.
    Finally, who would regulate x-ray units, accelerators, and 
other naturally occurring radioactive materials? These would be 
new responsibilities that would somehow have to be added to the 
NRC capability. Based on our experience with NRC and the 
private sector of ES&H staff, we volunteered for a similar 
pilot with OSHA.
    That effort took place in December 1998 and January 1999. 
It again involved two planning conference calls, an 8-day 
visit, and all hands meeting with the laboratory staff and our 
local labor unions. The visiting team included NRC, DOE, OSHA 
and Cal OSHA, and the California Department of Health Services 
and the EPA. They reviewed all of our facilities.
    The overall conclusion was that the OSHA regulatory 
framework could be applied to the Berkeley Lab and that the 
laboratory's integrated safety management program is consistent 
with OSHA's voluntary protection program, and I would like to 
say a very positive word about the Department of Energy moving 
to integrated safety management, because I think it has made us 
more effective in managing our responsibilities for 
environmental health and safety in our laboratories.
    As the result of these pilot studies, I believe that 
external regulation of the Berkeley Lab is not only possible 
but also desirable--however, with a very important caveat, that 
this be done with very clear lines of authority and priority 
given to risk-aware implementation. This would mean that the 
contractors would deal directly with regulatory agencies and 
that much of the DOE ES&H infrastructure would be reassigned to 
DOE's core mission.
    Let me be very clear about this. A layered, redundant 
oversight subjecting the laboratories to regulatory oversight 
by both DOE, NRC and OSHA would result in a more expensive, 
confusing and I believe less effective environmental health and 
safety program.
    Finally, I would like to make a point that needs to be made 
here. The results of the pilot at our laboratory should not be 
used to generalize this approach to work performed at all DOE 
facilities. Our laboratory is probably the simplest and easiest 
of the DOE facilities on which one could do a pilot, and it may 
well be that external regulation may not be desirable on 
broader sites because of the specialized expertise necessary 
for managing the risks and the unique facilities and security 
considerations. Thank you.
    [The prepared statement of Charles V. Shank follows:]
  Prepared Statement of Charles V. Shank, Director, Lawrence Berkeley 
                          National Laboratory
    Mr. Chairman and Members of the Subcommittee: It is my pleasure to 
be here today to provide my perspective on three bills dealing with the 
environment, health and safety of the Department of Energy complex.
    Just to reacquaint you, Berkeley Lab is the oldest of the DOE 
national laboratories, founded in 1931 and located next door to the 
University of California, Berkeley campus. Today we operate on a budget 
of approximately $415 million performing research for the Department of 
Energy (DOE), other Federal agencies and the private sector. Before 
becoming Director of the Lawrence Berkeley National Laboratory in 1989, 
I spent 20 years at the AT&T Bell Laboratories, ultimately directing 
the Electronics Research Laboratory in Holmdel, New Jersey. In 
addition, I now serve as Professor in three Departments at the 
University of California at Berkeley, in Physics, Chemistry and 
Electrical Engineering and Computing Sciences.
    The regulatory framework for the national laboratories is important 
for their scientific productivity, the safety of our employees, and the 
protection of the environment. Providing a safe and healthy environment 
is a critical management responsibility of the Laboratory Directors.
    The first bill, H.R. 3383, would eliminate the exemption for non-
profit contractors from paying fines and penalties levied under the 
Price-Anderson Act. As the University of California official 
responsible for managing my laboratory, I take compliance with the 
Price-Anderson Act very seriously. I am proud of the fact that we have 
an outstanding record of operating safely and of demonstrating the 
utmost concern for the environment.
    The University operates the Lawrence Berkeley National Laboratory, 
along with the Livermore and Los Alamos laboratories, as a public 
service without the desire for financial gain, and has instituted 
numerous mechanisms to insure compliance with Price-Anderson and all 
Federal and state statutes. The fees paid to the University for their 
management activities are derived from support for the laboratories' 
scientific programs. Therefore, any additional fees that might be paid 
as fines and penalties would be additional ``taxes'' on our research 
programs, while not increasing our outstanding level of compliance.
    The second piece of legislation, H.R. 3906, would establish a new 
Office of Independent Security Oversight within the Department, along 
with additional procedures for safeguards and security evaluations. I 
want to point out that Lawrence Berkeley National Laboratory performs 
no classified research on its site and has no ability to store 
classified information on site. We do, however, operate DOE's largest 
civilian supercomputing facility, along with managing DOE's Internet 
operation, so we do take seriously cyber security and other security 
measures appropriate for our site.
    My concern with the measures proposed in H.R. 3906 is that it 
imposes yet another new layer of bureaucratic management and oversight. 
A successful security program requires line management accountability 
and employee support. This bill will apply yet another burden on the 
scientific programs performed at the laboratories.
    Finally, let me turn to H.R. 3907, which would provide for external 
regulation of nuclear safety and occupational health and safety at DOE 
facilities. I would like first to talk about our experience with 
external regulation pilot studies with both the Nuclear Regulatory 
Commission (NRC) and the Occupational Health and Safety Commission 
(OSHA), and then turn to some more general comments about the 
legislation.
    As you may know, Berkeley Lab is located adjacent to the University 
of California, Berkeley campus, and we share many faculty and students. 
For many years, it has mystified me that identical activities carried 
out on the campus and at the laboratory are regulated by different 
entities, and with different standards. As a consequence, when NRC 
proposed a pilot project for external regulation of DOE facilities, I 
quickly volunteered our institution. My dream is for a world where 
similar work is regulated with uniform standards independent of the 
entity that performs the work. Scientists could then be trained with a 
single set of expectations for environment, health and safety 
considerations throughout the country.
    The NRC pilot took place between October 1997 and January 1998, 
with two planning visits to the laboratory, two one-week simulated 
regulation visits, and a public meeting to seek community input and 
comments. The results of the pilot were encouraging. NRC found that 
there were no significant safety findings to report, and that the 
laboratory had an adequate program to protect the health and safety of 
employees, the public and the environment. The NRC indicated that they 
would be willing at that time to issue the laboratory a broad scope 
license for their operation, and indicated that they could carry out 
their responsibility for our site with 0.1 FTE, or approximately one 
person-month per year.
    There are, however, a number of serious concerns. Would external 
regulation be layered on top of current DOE orders? We fear a world of 
overlapping and redundant responsibilities that would make it difficult 
for us to do our work. Who will hold the NRC license? The DOE report on 
our pilot indicates that additional people would have to be hired if 
DOE held the license. Who will be responsible for legacy issues? We at 
Berkeley Lab have old facilities for which clean-up funds have not been 
allotted. Who will regulate x-ray units, accelerators and naturally 
occurring radioactive materials?
    Based on our experience with the NRC pilot, and the private sector 
experience of our ES&H staff, we volunteered to conduct a similar pilot 
with OSHA. This effort took place between December, 1998 and January 
1999. It involved two planning conference calls, one eight-day site 
visit, an all-hands meeting with laboratory staff and meetings with our 
local labor unions. The visiting team included representatives from 
NRC, DOE, OSHA, Cal-OSHA, the California Department of Health Services 
and the EPA. They reviewed all our facilities and programs applying the 
concept of simulated regulation and inspection, with comprehensive 
safety and health inspections and simulated citations for alleged 
violations.
    The overall conclusion was that the OSHA regulatory framework could 
be applied to Berkeley Lab, and that the laboratory's Integrated Safety 
Management program is consistent with OSHA's Voluntary Protection 
Program. OSHA did identify 63 simulated citations, for a total 
simulated penalty of $57,700 or an average of $916.00 per violation. 
They also had a number of issues that would need further attention, but 
none of them could be considered significant enough to prevent their 
efficient regulation of the site.
    As a result of these pilot studies, I believe that external 
regulation of Berkeley Lab is not only possible but also desirable, 
with the caveat that this is done with clear lines of authority and 
priority is given to efficient, risk-aware implementation. This would 
mean that contractors would deal directly with regulatory agencies, and 
that much of the existing DOE ES&H infrastructure would be reassigned 
to the Department's core mission. Let me be perfectly clear on this 
point: a layered, redundant oversight, subjecting the laboratories to 
regulatory oversight by both the DOE and NRC and OSHA, would result in 
a more expensive and confusing ES&H climate.
    Finally, I am very concerned that the results of these pilots not 
be used to generalize this approach to all the work performed at DOE 
facilities. In some cases, such as at weapons laboratories and 
production facilities, external regulation may not be desirable owing 
to the specialized expertise necessary for managing risks in unique 
facilities and security concerns.

    Mr. Barton. Thank you, Dr. Shank. We would now like to hear 
from Mr. Van Ness on behalf of the University of California.

                 STATEMENT OF ROBERT L. VAN NESS

    Mr. Van Ness. Mr. Chairman, I appreciate the opportunity to 
come before the subcommittee to discuss proposed legislation 
ending the exemption of nonprofit institutions from civil fines 
and penalties for Price-Anderson Act violations.
    I have submitted a written statement to the subcommittee 
that addresses this, but I would like to spend a few moments on 
some key points covered in that statement.
    When I appeared before the Subcommittee on Oversight and 
Investigations last June, I outlined the measures the 
University had taken to implement nuclear safety programs at 
the DOE laboratories and the reasons the University is 
motivated to protect worker and public safety regardless of 
whether there is a financial penalty for failing to do so. All 
these things remain true.
    Nevertheless, during the hearings last June the University 
agreed that the existence of the Annual Performance Management 
Fee, a revenue source that did not exist at the time that the 
statutory exemption was placed in the Price-Anderson Act, made 
it possible to remove the exemption if it were replaced by a 
suitably tailored provision that recognized the fiduciary 
responsibilities of nonprofit institutions such as the 
University.
    Our understanding of the discussion at the June hearing was 
that the committee was willing to limit any civil penalties for 
nuclear safety rule violations to the availability of annual 
fee to be used for that purpose. Now our reading of the 
proposed legislation is that there would be no limit placed on 
the potential financial penalties.
    We stand by our commitment of last summer, to be 
financially accountable consistent with nonprofit purposes, but 
we urge that legislation that reflects the financial needs of 
nonprofit contractors be set forward.
    There is similar legislation before the Senate that does 
establish a ceiling on the amount of financial risk for nuclear 
safety violations. That would be preferable to the legislation 
being considered by the committee, but the Senate language is 
critically flawed in that it fails to recognize that nonprofit 
contractors have significant existing unreimbursed costs in 
addition to those penalties that are currently being 
considered.
    This flaw would be remedied by the addition of the words 
``the available annual'' to the phrase ``performance fee''--
such language would assure that the sum of unreimbursed costs 
from all sources is limited to the nonprofit contractors' 
annual performance fee.
    The primary reason we seek the limitation for nonprofit 
contractors is to meet our fiduciary responsibilities to the 
state of California, its citizens, our students and donors. It 
is also important to recognize that performance fee paid to the 
University or any other DOE contractor in reality diminishes 
the scientific effort funded. DOE programs are provided 
appropriations that are distributed to fund effort at the 
national laboratories. Fee is an element of overhead costs that 
is charged to the local program at a laboratory to recover 
general and administrative costs of the laboratory.
    It is for this reason and not to avoid accountability that 
the University has sought to minimize the nature and amount of 
federally mandated unreimbursed costs.
    The Congress is faced with balancing of interests. How do 
you maximize the scientific effort obtained with any 
appropriation while encouraging good stewardship on the 
contractors who operate the national laboratories? There is no 
perfect answer. The University's own solution today is a mix of 
idealism and pragmatism. The University takes a fee that it 
believes is prudent to assure that it can meet its fiduciary 
obligations and then returns the unexpended balance to fund 
research at or for DOE laboratories.
    We acknowledge the need to be accountable for worker and 
public safety. In spite of our commitment to safety, we have 
yet to reach perfection. As you mentioned in your opening 
remarks, this past Thursday we had a plutonium exposure 
incident at Los Alamos involving eight employees. Four of the 
eight required treatment. All eight have returned to work. The 
DOE is conducting an investigation and the University and the 
Laboratory are cooperating fully. We will ensure full support 
to the exposed employees as well as prompt implementation of 
all corrective actions.
    Congress has a difficult task in balancing the interests of 
funding science and holding cost-type contractors accountable 
as financial accountability is a driver in the amount of fee. 
The University strongly encourages the committee to consider a 
penalty amount ceiling as recommended in this testimony as a 
means of making it possible for nonprofit entities to continue 
to be operators of these important national research 
facilities.
    I thank you for your attention to this matter and I look 
forward to answering any questions.
    [The prepared statement of Robert L. Van Ness follows:]
Prepared Statement of Robert L. Van Ness, Assistant Vice President for 
          Laboratory Administration, University of California
    Mr. Chairman and Members of the Committee, I am Robert L. Van Ness, 
Assistant Vice President for Laboratory Administration for the 
University of California (UC). The University operates three Department 
of Energy (DOE) laboratories--the Los Alamos National Laboratory 
(LANL), the Lawrence Livermore National Laboratory (LLNL), and the 
Lawrence Berkeley National Laboratory (LBNL). My responsibilities 
include administering the performance-based management aspects of our 
contracts with the Department of Energy and conducting oversight of the 
administrative and operational activities of the laboratories. I want 
to thank the Committee for the opportunity to appear and to testify on 
an issue similar to the testimony I provided before the Subcommittee on 
Oversight and Investigations last June. I have included a copy of this 
previous testimony for the record.
    The University is indemnified against public liability under the 
Price-Anderson Amendments Act (PAAA), and, as such, is subject to DOE 
nuclear safety regulations at the three laboratories. The University is 
also one of the entities currently exempt from the civil fines and 
penalties under Section 234A (d) of the Act. My testimony will address 
the proposed legislation (H.R. 3383) that would eliminate that 
exemption.
    The University has historically opposed assumption of risk in the 
operation of federally-funded research and development centers 
(FFRDCs), including non-reimbursement of fines and penalties. Non-
profit governmental entities such as UC do not have the statutory 
authority nor financial resources necessary to assume substantial risk 
for operating FFRDCs. Indeed, Congress originally included the Price 
Anderson exemption for non-profits in recognition that the federal 
government would lose access to important non-profit partners in the 
management of the national laboratories without some risk allowance. As 
federal procurement policy related to FFRDCs evolved in the past 15 
years, more costs associated with the maintenance and operation of 
these facilities have become unallowable costs. Accordingly, the 
Department of Energy recognized the need to address this issue through 
the introduction of an annual performance-based management fee to 
federal contractors. The UC contract to manage the three national 
laboratories was re-negotiated in 1992 and included an annual 
performance management fee. The introduction of the fee structure 
addressed the risk issues and enabled the University to continue the 
public service of managing three national laboratories.
    During the Subcommittee on Oversight and Investigations hearings 
last June, the University agreed that the performance management fee, 
an annual revenue source that did not exist at the time the statutory 
exemption was adopted, provided a mechanism by which the exemption for 
non-profits could be modified. The availability of a management fee 
provides an annual revenue source from which financial penalties can be 
exacted for specified misconduct. At the hearing UC also urged the 
Committee to limit penalty provisions to the availability of the annual 
performance management fee. Expanding a liability provision, such as 
that proposed in the current legislation, beyond the availability of 
annual fee once again subjects a non-profit to more risk than its 
officeholders (e.g., the UC Regents) would find permissible. Absent 
such a limitation the University would be unable to meet its fiduciary 
obligations to those that support its non-DOE laboratory operations--
the California state taxpayers, students, and donors.
    We recommend the Committee consider similar legislative language 
currently being considered by the Senate in S. 2162:
        SEC. 8. CIVIL PENALTIES.
          (a) REPEAL OF AUTOMATIC REMISSION--Section 234A b.(2) of the 
        Atomic Energy of 1954 (42 U.S.C. 2282a(b)(2)) is amended by 
        striking the last sentence.
          (b) LIMITATION FOR NONPROFIT INSTITUTIONS--Section 234A of 
        the Atomic Energy Act of 1954 (42 U.S.C. 2282a) is further 
        amended by striking subsection d. and inserting the following:
        `d. Notwithstanding subsection a., no contractor, 
        subcontractor, or supplier considered to be nonprofit under the 
        Internal Revenue Code of 1954 shall be subject to a civil 
        penalty under this section in excess of the amount of any 
        performance fee paid by the Secretary to such contractor, 
        subcontractor, or supplier under the contract under which the 
        violation or violations; occur.'
    While the Senate language places a ceiling on the amount of 
penalties, it does not provide absolute assurance that sufficient funds 
are on hand from annual contract revenues to pay the penalties because 
non-profits are exposed to numerous other types of unreimbursed costs. 
Consequently, we recommend modifying the language to limit penalties to 
the amount of any available annual performance fee. Like all DOE cost-
type contractors, the University is subject to federal reimbursement 
limitations for a variety of costs including: environmental and 
security penalties; accounting deficiencies; defense costs in certain 
actions brought by state and local governments and federal agencies; 
defense costs in certain employee grievances; certain liabilities to 
third parties; property and other losses under certain conditions; 
community relationships, and certain employee compensation expenses. 
Federal policies in many of these areas encourage better practices by 
contractors, but losses are not totally controllable by the prompt 
actions of contractors. For example, federal agencies have interpreted 
the Major Fraud Act to preclude 100% federal reimbursement to 
government contractors even in cases where the contractor is completely 
exonerated.
    It is also important to recognize that any annual performance fee 
paid to the University or any other DOE contractor, comes at the 
expense of funding for the primary scientific mission of the 
laboratory. The performance management fee is an element of overhead 
cost that is charged to the local research programs at a laboratory to 
recover general and administrative costs of the laboratory. Since the 
mission of the national laboratories is the conduct of their federally-
funded research programs, the University has sought to minimize the 
nature and amount of federally mandated unreimbursable costs associated 
with FFRDC operations.
    We believe Congress is faced with balancing mutually important 
interests. How do you maximize the scientific effort obtained with any 
appropriation while encouraging good stewardship from the contractors 
who operate the national laboratories? There is no perfect answer. The 
University's own solution to date is a mix of idealism and pragmatism. 
The University receives an annual fee that it believes is prudent to 
protect the non-profit institution against risk and meet its fiduciary 
obligations, then returns the unexpended balance to fund research at or 
for the UCDOE laboratories.
    Last June I testified about the important non-financial factors 
that motivate the University and the safety of our nuclear operations 
as well as the existing contract tools already available to DOE to 
ensure contractor compliance and performance improvement. Our approach 
to the amount and use of fee reflects our commitment to the core 
motivations of the institution--to expand the base of human knowledge, 
to confer knowledge from one generation to the next, to make our 
country secure through the application of ideas and science. We are 
prepared to continue our record of outstanding service to the nation 
and make alterations in the rules surrounding that service so long as 
we can meet our core objectives and our fiduciary obligations. We 
remain committed to the safety of our workers and the public, 
notwithstanding the occasional setback. In that last regard I am 
obliged to tell the Committee of an incident last week in which eight 
workers were exposed to small levels of air-borne plutonium-238 at Los 
Alamos National Laboratory. Four of the eight employees required 
treatment. All eight have returned to work. We are working very closely 
with DOE and others to take immediate and effective corrective action. 
We will ensure full support to the exposed employees.
    In summary, we embrace the need to be accountable for worker and 
public safety. We applaud the interest of this Committee in balancing 
the interests of science with the needs of employees and the general 
public to be safe from nuclear and environmental hazards. We recognize 
the difficulty you face in achieving a satisfactory level of 
accountability from non-profit contractors and understand the intent 
behind the proposed legislation. The University strongly encourages the 
Committee to consider a penalty ceiling, as recommended in this 
testimony, as a means of ensuring that non-profit entities can continue 
to be partners with the federal government in the operation of FFRDCs. 
Thank you for the opportunity to appear before you.

    Mr. Barton. Thank you, Mr. Van Ness. We would now like to 
hear from Ms. Eldredge for 7 minutes. Your statement is in the 
record in its entirety.

                  STATEMENT OF MAUREEN ELDREDGE

    Ms. Eldredge. Chairman Barton, members of the committee, 
thank you for allowing me to testify.
    Before I get into the details of my testimony, I just have 
to give you the very, very short summary, which is in the past 
week and a half there has been no less than five articles on 
nuclear safety problems and disasters at DOE sites, and yet the 
General Counsel sits here and says they have made tremendous 
strides in safety. They have not, and the shortest version of 
my testimony that I can give you is we could have OSHA now and 
we should do it. We have some concerns about the other things, 
but there are pieces that we could move forward with right now.
    The Alliance for Nuclear Accountability is a network of 32 
organizations. We have a long history of working at DOE nuclear 
weapons sites doing watchdog and oversight, and we have 
concluded along with numerous external panels and independent 
advisory committees that DOE cannot regulate itself and we are 
very pleased that this committee is taking steps to address 
this problem and hope that we can move forward with at least 
part of it this year.
    I want to touch briefly on some problems that came up in 
legislation last year that made the problem worse. That is the 
passage of Title 32 of the Defense Authorization Act which set 
up the National Nuclear Security Administration. I will just 
highlight two problems with that.
    One is the problem of sovereign immunity. I know that the 
Attorney Generals have been before you at another hearing 
talking about that so I will not spend too much time on it, but 
there is some language in that Act that creates some ambiguity 
about whether the waivers of sovereign immunity that exist now 
at the DOE weapons sites still apply to the NNSA sites, and we 
urge you to address that.
    Additionally, there is a problem with Price-Anderson Act 
enforcement of the nuclear safety rules with regards to the 
NNSA facilities. There is a consequence of the Act that now the 
Assistant Secretary of Environment, Safety and Health cannot 
issue notices of violation or fines directly to the offending 
NNSA facility. They have to go through the Administrator of the 
NNSA, so essentially the line program that has committed the 
violation has to fine itself. This is sort of self-regulation 
and it needs to stop, and we urge you to pass legislation that 
will both clarify the sovereign immunity issue and ensure that 
the Office of Environment, Safety and Health has authority over 
all aspects of DOE including the new National Nuclear Security 
Administration.
    NNSA is not the sole source of the problem however. There 
have been and there remain serious problems within the weapons 
complex. Last week five workers at the Los Alamos Lab, as was 
mentioned, were exposed to plutonium. Rocky Flats workers and 
managements were reported to have been violating safety 
procedures that prevent criticalities. There have been 
explosions at the Y-12 plant in Oak Ridge. The list goes on and 
on.
    The frequency and severity of some of these accidents 
astounds me. After 50 years of nuclear weapons work DOE still 
doesn't seem to realize that it is handling some of the most 
deadly material known to man.
    The case for external regulation has been built over 50 
years and it cannot be stated more bluntly: DOE cannot regulate 
itself.
    We hope the committee will not fall prey to partisan 
disputes--I am disappointed that none of the minority is here--
and can overcome political roadblocks to this much-needed 
reform.
    Mr. Barton. I'll let them know your testimony, I promise.
    Ms. Eldredge. Thank you.
    With regards to H.R. 3907 we greatly support the concept of 
moving to external regulation and we strongly support OSHA as 
the regulator, but we do have some concerns about the Nuclear 
Regulatory Commission as a regulator which I will touch on 
later.
    OSHA can be brought in to regulate protection for all 
workers with the caveat that it needs sufficient resources, 
both funding and personnel, and time to do the job right, and 
it is close to criminal that there is little enforcement system 
for worker safety rules at DOE that are not part of the Price-
Anderson Act Nuclear Safety Rule Enforcement Program but are 
equally vital. This includes the new beryllium rule, which is a 
nice rule but it doesn't have any enforcement procedures 
attached to it.
    For regulation of facility safety we are concerned about 
NRC as the regulator and concerned about shifting the 
responsibility from one dubious entity to another. The 1995 
Advisory Committee, the independent committee that looked at 
external regulation, also had difficulties reaching conclusions 
on who should be the regulator for nuclear facility safety.
    NRC has shown a remarkable ability to push the nuclear 
industry interests at the expense of public health. For 
example, they have licensed uranium mines in New Mexico even 
while acknowledging that the results of these mining operations 
would be contamination of the sole drinking water supply for 
15,000 people, mostly Native Americans, and currently they are 
shifting to a risk-informed regulatory approach which 60 
percent of its own staff believe will reduce the margins of 
safety at nuclear plants so we have some concerns there.
    For our network of 32 organizations, NRC is not the white 
hat that will come riding in and save the day. However, this 
should not stop us from moving forward with phasing in external 
regulation at DOE and looking at pilot projects for who would 
be a good regulator and exploring some changes to NRC to make 
that a better regulator.
    Some specific recommendations for this year: Institute OSHA 
regulation for all worker safety requirements. It is simple, 
there is precedent and it makes sense. I do not see hardly see 
why there is anything more to say about it.
    We also recommend amending the Atomic Energy Act to 
harmonize it with other environmental statutes. This in 
particular refers to citizen suit provisions. They have been 
the provisions that have provided access for citizens and the 
states to make their regulators accountable and we recommend 
that we look at setting up citizen suit provisions for both NRC 
and for DOE.
    At DOE, the problem is even worse. There are no citizen 
suit provisions with regard to the orders, and even within DOE 
they said they needed 11 rules to have a good Price-Anderson 
Act enforcement program. They have only put out two of them to 
date.
    Finally, administrative changes that could be made right 
away and wouldn't even require legislation, and that is 
requiring DOE to meet OSHA reporting standards. They have the 
data. They have it on data base, but they will not put it out 
for the public to access. They could do it easily and they 
should.
    In conclusion, we urge you to move forward with this effort 
at external regulations, whichever pieces that you can. 
Fundamentally, DOE as a self-regulating entity cannot persist 
without seriously compromising safety and health. After 50 
years of environment and safety disasters, it is time to bring 
DOE into the future. Thank you.
    [The prepared statement of Maureen Eldredge follows:]
Prepared Statement of Maureen Eldredge, Program Director, Alliance for 
                         Nuclear Accountability
    Chairman Barton, Representative Boucher, and members of the 
Committee, the Alliance for Nuclear Accountability appreciates the 
opportunity to once again testify on badly needed efforts to improve 
the environment and safety culture at the Department of Energy (DOE).
    The Alliance for Nuclear Accountability is a national network of 32 
organizations working on nuclear weapons complex issues. For over a 
decade we have decried the shoddy environmental and safety practices at 
DOE. This disregard for environmental rules resulted in the widespread 
contamination around the complex. We have pressed for DOE to be subject 
to the same environmental laws and requirements as the rest of us, and 
we concluded that neither DOE nor any other agency could be an 
effective regulator of itself. The federally appointed Advisory 
Committee on External Regulation of DOE Nuclear Safety, also concluded 
that, ``Every major aspect of safety at DOE nuclear facilities--
facility safety, worker protection, public and environmental 
protection--should be externally regulated . . .'' 1
---------------------------------------------------------------------------
    \1\ Advisory Committee on External Regulation. Improving Regulation 
of Safety at DOE Nuclear Facilities, December 1995.
---------------------------------------------------------------------------
    We are very pleased that the committee is taking steps to address 
this problem. We hope that if the entire legislative package is not 
possible all at once, that at least some crucial elements will be 
addressed in legislation this year. We need to move towards a more sane 
regulatory structure for DOE, and take steps now to start the process.
           problems with the national nuclear security agency
    The passage of Title 32 of the Defense Authorization Act for Fiscal 
Year 2000, which set up the National Nuclear Security Administration 
(NNSA), was a disaster for environment, safety, and health programs. 
Rather than move us towards better regulatory oversight of DOE's 
nuclear weapons program, it shifted, either through intent or ambiguous 
legislative language, to a situation that more closely resembles the 
bad old days of the Atomic Energy Commission, than a modern and 
environmentally sound approach to operations.
    I would like to highlight two major problems with the NNSA 
structure. These are the ambiguity regarding DOE's waiver of sovereign 
immunity and the oversight role of the office of Environment, Safety, 
and Health (EH) in the new Administration.
Sovereign Immunity
    The federal government faces an enormous liability in the cleanup 
of the nuclear weapons complex. DOE estimates that it has contaminated 
over 600 billion gallons of groundwater and over 33 million cubic 
meters of soil. This contamination came from decades of abuse, in which 
there was no external regulation, and DOE and its predecessor agencies 
claimed that they had ``sovereign immunity'' from compliance with 
environmental laws enforced by States. In 1992 Congress passed the 
Federal Facilities Compliance Act, which originated in this committee, 
to clarify that DOE was, in fact, required to comply with State 
enforcement and regulations.
    Sections 3261 of S. 1059 includes qualifying language which casts 
doubt on the applicability of the current waivers of sovereign immunity 
with respect to the NNSA. It states:
        The Administer shall ensure that the Administration complies 
        with all applicable environmental, safety, and health statues 
        and substantive requirements. (emphasis added)
    This qualifying language has raised concerns in State Attorney 
General's offices across the country with regards to the sovereign 
immunity issues, and we concur with their analysis. We urge the 
Congress to amend the NNSA legislation to clarify that State regulatory 
authority over NNSA remains intact, and that the waivers of sovereign 
immunity in place before the creation of the NNSA also apply to it. 
Relying on a record of legislative intent it not sufficient.
Price-Anderson Act Enforcement
    In addition to the sovereign immunity problem, there is serious 
concern with regards to the application of EH requirements to the new 
Administration. A consequence of the NNSA legislation was to 
effectively pull the teeth of the already weak efforts at regulation of 
safety and health issues from within DOE. The Assistant Secretary of 
the Office of Environment, Safety, and Health can no longer directly 
issue notices of violations and impose fines under the Price-Anderson 
Act for nuclear safety rule violations, to NNSA facilities. The 
Assistant Secretary must develop a recommendation to submit to the 
Administrator of the NNSA, who then decides upon imposing fines. This 
situation arises out of language in Title 32, which prevents non-NNSA 
personnel from directing NNSA personnel.2 This is self-
regulation at its worse, as even the limited independent enforcement 
authority within DOE is eliminated. The line program, the very program 
that has committed the violation, will be asked to fine itself. Only 
continual pressure from the outside, including media and public 
interest groups, will ensure enforcement. Nuclear safety enforcement by 
continual scandal is not effective. This is a massive step backwards 
and must be corrected.
---------------------------------------------------------------------------
    \2\ Section 3213 (a) STATUS OF ADMINISTRATION PERSONNEL. ``Each 
officer or employee of the Administration, in carrying out any function 
of the Administration''
    (2) shall not be responsible to, or subject to the authority, 
direction, or control of, any other officer, employee, or agent of the 
Department of Energy.
    (b) STATUS OF CONTRACTOR PERSONNEL. ``Each officer or employee of a 
contractor of the Administration, in carrying out any function of the 
Administration, shall not be responsible to, or subject to the 
authority, direction, or control of, any officer, employee, or agent of 
the Department of Energy who is not an employee of the Administration, 
except for the Secretary of Energy consistent with section 202(c)(3) of 
the Department of Energy Organization Act.
---------------------------------------------------------------------------
    In addition, several of the labs have already indicated that they 
no longer feel they must comply with EH rules and requirements, despite 
DOE's ``duel-hatting'' of the Assistant Secretary for EH. We believe it 
was the intent of the drafters of this legislation to ensure the 
autonomy of the NNSA. However, we strongly oppose the idea of 
recreating a new office of EH within the NNSA, which would be at a 
lower status and report to the Administrator instead of to the 
Secretary of Energy. There is already a problem with DOE being self-
regulated, subsuming the EH functions within the NNSA would further 
compound this problem. There is one clear solution--the Office of 
Environment, Safety, and Health should have authority over all parts of 
DOE, including the NNSA.
    The solutions to the EH problems that have been offered to date are 
not enough. Exhortations in the legislation to ``ensure that all 
operations and activities of the Administration are consistent with the 
principles of protecting the environment and safeguarding the safety 
and health of the public and of the workforce (Section 3211(c))'', 
provide no guarantee of compliance with regulations and orders. 
Legislating Secretarial authority to delegate is not sufficient. Such 
an action still leaves the crucial environment, safety, and health 
compliance of the entire agency up to the decision of one person, who 
may or may not be in place for very long. These issues are too 
important to leave in such an uncertain state, dependent on the will of 
one person.
    We urge you to pass amending legislation that clarifies that the 
Office of Environment, Safety, and Health's has full authority over the 
NNSA with regards to environment, safety, and health oversight and 
enforcement, and that the Price-Anderson Act enforcement program is 
fully enforceable by EH on NNSA facilities.
                problems exist throughout the department
    Even before the NNSA came into being there were, and there remain, 
serious problems in the weapons complex which result in injuries to 
workers and contamination of the environment, seemingly beyond the 
ability of DOE to correct. Since I last testified on this subject, the 
list of accidents and violations has continued unabated. Just last week 
five workers at the Los Alamos lab in New Mexico were exposed to 
airborne, particulate plutonium, a known carcinogen. On Monday the 
Boulder, Colorado, newspaper reported that Rocky Flats workers and 
managers violated safety procedures, which increased the risk of 
nuclear explosions (criticalities).3 On March 8th, DOE 
levied $110,000 in fines against Westinghouse Savannah River for 
recurring violations of safety procedures on equipment design, 
construction, and installation. In December of 1999, there was an 
explosion at the Y-12 plant at Oak Ridge, which injured 11 workers. Not 
only did DOE find that there were ``failures at every level of . . . 
(the) management chain'', but it also determined that injuries could 
have been lessened had proper protective equipment been available for 
the personnel.4 In April of 1999, Lockheed Martin, DOE, and 
Fluor Daniel were all fined at the Hanford site for inadequate 
monitoring of high level waste tanks. Finally, on March 6, DOE publicly 
announced what site managers had known for over 9 months--that the 
Ogallala aquifer was contaminated with tri-chloroethylene from the 
burning grounds at Pantex.
---------------------------------------------------------------------------
    \3\ Katy Human. Reports: Flats Broke Safety Rules. Boulder Daily 
Camera, March 20, 2000.
    \4\ Dr. David Michaels, Assistant Secretary for Environment, 
Safety, and Health. DOE News Release, February 24, 2000.
---------------------------------------------------------------------------
    The list of violations in just one year could fill a textbook. The 
frequency and severity of some of these accidents continues to astound 
me. After over 50 years of nuclear weapons work, DOE and its 
contractors still fail to realize that they are dealing with some of 
the most dangerous materials on earth, and treat safety procedures as 
optional.
    The case for external regulation of DOE has been built over 50 
years, and at this point seems, to the general member of the public, 
beyond obvious. It cannot be stated more bluntly: DOE cannot regulate 
itself. The record of such self-regulation is astounding in its 
failure. Political obstacles have prevented the common-sense move 
towards external regulation for decades, and we see them developing 
again in this Congress. We sincerely hope that this committee will not 
fall prey to partisan disputes, and can overcome the political 
roadblocks to this much-needed reform. We ask, how many more accidents, 
injured workers, and contaminated groundwater is needed before this 
effort can move forward?
               critique of hr 3907 and specific concerns
    In general, the Alliance for Nuclear Accountability greatly 
supports the concept of HR 3907 in moving DOE into external regulation. 
In 1995, the independent advisory committee recommended that DOE be 
externally regulated, and supported OSHA as the regulator for worker 
safety. However, it did not reach consensus on who the regulator should 
be for nuclear safety. Unfortunately, with regards to nuclear safety 
and regulatory enforcement, neither can we.
Occupational Safety and Health Administration
    At a minimum, the Occupational Safety and Health Administration 
(OSHA) should be brought in as the regulator for all protection of 
workers, with the caveat that it needs sufficient resources--both 
funding and personnel, to do the job right. It is close to criminal 
that there is little enforcement system for the worker safety rules at 
DOE that are not nuclear safety rules, but are equally vital. These 
include the new beryllium rule, which is intended to protect workers 
from berylliosis, a crippling lung disease, or protection from the many 
chemical hazards that exist at DOE facilities. OSHA has the statutory 
authority to enforce these rules, however DOE exercises its exemption 
under 4 (b)(1) of the Occupational Safety and Health (OSH) Act. This 
exemption was intended to allow agencies to enforce the rules 
themselves. Given DOE's abysmal record of this, combined with the new 
NNSA's reluctance to take orders from anyone, it is time to remove this 
exemption for DOE and return OSHA's authority.
    However, to do this requires both time and money. It is not 
sufficient to say that OSHA will regulate a facility, and then have the 
nearest OSHA office be hundreds of miles away, with an extremely 
limited capacity for effective oversight. DOE will require sufficient 
resources to come into compliance. A time frame must be developed for 
transitioning to OSHA regulation and for bringing DOE into compliance. 
An effective time frame should be on the order of two years, with 
sufficient incentives for DOE to actually begin work on compliance now.
Nuclear Regulatory Commission
    For regulation of facility safety, we are concerned about the 
Nuclear Regulatory Commission (NRC) as the choice of regulator. Faced 
with the choice of DOE or NRC as a regulator is a bit like being faced 
with death by hanging or death by firing squad. Neither is particularly 
attractive and shifting responsibility from one dubious entity to 
another is not much of a solution. The 1995 Advisory Committee 
recommended looking at either NRC or the Defense Nuclear Facilities 
Safety Board (DNFSB). Both of these entities have problems and would 
need some major structural changes to be acceptable.
    NRC has shown a remarkable ability to push nuclear industry 
interests at the expense of public health. It proposed a ``below 
regulatory concern'' (BRC) category for nuclear waste, which would 
allow such waste to be treated as if it were not nuclear. Only strong 
opposition from the public prevented this step, but NRC generally still 
supports it. Given the ongoing trend in radiation standard setting, 
which finds that previous standards were not stringent enough, this 
position is alarming. NRC has licensed uranium mines in New Mexico even 
while acknowledging that the result of the mining operation would be 
contamination of the sole drinking water supply for 15,000 people, 
mostly Native Americans. Currently NRC is shifting to ``risk-informed'' 
regulation, which 60% of its own staff believes will reduce the margins 
of safety at nuclear power plants. It is also trying to shift to 
informal rulemaking, which will reduce the public's access to 
information and ability to intervene in the process.
    For our network of 32 organizations, NRC is not the ``white hat'' 
that will come in to save the day at DOE. However, that does not mean 
that we support giving up on the effort to find an external regulator. 
We should move forward, begin phasing in external regulation under 
OSHA, and develop tools to evaluate the performance of both NRC and the 
Defense Nuclear Facilities Safety Board (DNFSB) as possible regulators. 
External regulation will not come overnight, but the challenges we face 
should not dissuade us from doing what is right. Both NRC and DNFSB 
would need some changes to its operations to be acceptable as a 
regulator. The DNFSB would need to curtail its activities to safety 
issues, rather than commenting on equipment choices and preferred 
technology issues, which are unrelated to safety. NRC would need to be 
subject to citizen suit provisions and operate from a basis that 
emphasizes public and worker safety, rather than growth of the nuclear 
industry. Exploration of both options for a regulator should continue, 
with an eye towards reforms.
                            recommendations
    The Alliance for Nuclear Accountability urges the committee to move 
forward now on a number of actions that may not be the complete 
legislative package that we all want, but will be important steps in 
the right direction.
Legislative Changes
    A. Institute OSHA Regulation for all Worker Safety Requirements.--
Currently, even within the non-NNSA parts of DOE, compliance with EH 
requirements in areas other than nuclear safety, such as OSHA 
requirements, chemical safety rules, and the new beryllium rule, is 
entirely voluntary. There are no penalty provisions for these rules, as 
exist for nuclear safety rules under the Price-Anderson Act. This is 
absolutely unacceptable. If the legislative challenges facing HR 3907 
prove too steep, we urge the committee to excerpt section 4 as an 
amendment on its own. Some modifications include providing for baseline 
reviews of DOE compliance and a two-year time frame to move into OSHA 
enforcement. There is precedent for this in the transfer of enforcement 
authority to EPA for CERCLA and RCRA programs in 1985. In addition, the 
OSH Act has authority for radiological hazards already, and could be to 
cover combined radiological and non-radiological hazards in the absence 
of a second external regulator.
    B. Amend the Atomic Energy Act to Harmonize it with Other 
Environmental Statutes.--The lack of citizen suit provisions in the AEA 
eliminates one of the most effective tools available to States and the 
public for ensuring agency accountability. The 1995 Advisory Committee 
on External Regulation recommended that citizens be allowed to sue DOE 
and its contractors to comply with applicable statutes and regulations. 
We recommend that the citizen suit provision also be extended to the 
NRC. The ability of citizens and States to bring suit under the Clean 
Water Act and other statutes has been responsible for ensuring much of 
the compliance within agencies and corporations we see today (example 
of State suing, particularly Texas?). It allows states to enforce 
regulations and protect its citizens by challenging the regulators when 
it sees the need. Setting up the same type of citizen suit provisions 
on the NRC would go a long way towards making it a more acceptable and 
accountable regulator.
    Within DOE, the problem is even worse. Not only are there no 
citizen suit provisions with regards to DOE orders, many of those 
orders are not even enforceable under DOE's own rulemaking procedures. 
In fact, DOE hasn't even issued all the safety rules that would provide 
additional enforcement authority under Price-Anderson. It has finalized 
only two of the 11 rules it said it needed, and USA Today on March 20 
explores the possibility that industry pressure has prevented the rules 
from proceeding.5 Until DOE is externally regulated, one 
positive step that can be taken now would be to require DOE to issue 
all orders pursuant to the Administrative Procedures Act notice and 
comment. This would allow citizen suits to proceed under the 
requirement that the agency must follow its own orders. This would not 
address the issue of making contractors more accountable, as they would 
not be subject to citizen suits under this law. However, even this 
small step forward would be welcome.
---------------------------------------------------------------------------
    \5\ Peter Eisler. Safety Over a Barrel. USA Today, March 20, 2000.
---------------------------------------------------------------------------
Administrative Changes
    A. Require DOE to Meet OSHA Reporting Standards.--At OSHA, one can 
log onto a web site and see a list of violations at a facility, and 
their ultimate disposition. OSHA also requires a log of on the job 
injuries and illnesses. There is no reason this can't happen at DOE. 
Already DOE has the Operation Reporting Program System (ORPS), in which 
incidents and events are shared with DOE for significant safety and 
health items. In addition it has the Computerized Accident and Incident 
Reporting System (CAIRS), which is similar to the OSHA log of on the 
job injuries and illnesses. I have included with my testimony a copy of 
the OSHA web site page, and the results of a search for accidents 
involving trichloroethylene. OSHA provides the ability to search by a 
variety of terms, and lists all accidents that match, as well as 
providing detailed information about the accident and fines 
imposed.6 By contrast, most DOE sites do not provide easy 
public access to its ORPS reports. Only at the Los Alamos National Lab 
(LANL), due to the persistence of determined individuals, are ORPS 
reports posted on a database, and even that is not easy to find on 
their web site unless you know it is there. It is buried six screens 
deep under Environment, Safety, and Health ``services'' rather than in 
the ``databases'' section. Information from the CAIRS reports, which is 
relevant to OSHA, is not available to the public. Other accident and 
incident data exists in databases that are not only closed to the 
public, but closed to many workers as well.7 The basic 
infrastructure is in place for DOE to report accidents, which could 
easily be converted to OSHA-style reports and open to public access. 
This is important information for both the public and the workforce, 
and should be made available as a tool to further contractor and agency 
accountability. It would not require a legislative change to make this 
happen, just a decision by DOE to be more open about its mistakes.
---------------------------------------------------------------------------
    \6\ To conduct an accident search, go to http://www.osha.gov/
oshstats/ and click on Accident Investigation Search.
    \7\ To access LANL's ORPS reports, go to http://drambuie.lanl.gov/
esh7/Finals/. LANL's homepage is www.lanl.gov.
---------------------------------------------------------------------------
    B. Clarify and Invest the Environmental Protection Agency with 
Standard Setting Authority.--Protracted fighting between EPA and NRC 
over standard setting for nuclear issues, such as Yucca Mountain, and 
reactor decommissioning, have resulted in few, inconsistent, standards. 
This is untenable. EPA is the agency charged with protecting public 
health and the environment, and should be given the sole responsibility 
for standard setting. While we are often not happy with EPA's 
standards, and consider them too weak, they are a far cry from NRC. For 
example, NRC's standard for exposure to the general public would result 
in a lifetime risk of premature cancer death of one out of every 300 
people 8. That is shocking and shameful. The nuclear 
industry should be subject to the same standards and risk levels as 
other industries, and EPA should be the regulator in that regard.
---------------------------------------------------------------------------
    \8\ GAO. Nuclear Health and Safety: Consensus on Acceptable 
Radiation Risk to the Public is Lacking. GAO/RCED-94-190. September 
1994.
---------------------------------------------------------------------------
    C. Set Up Limited NRC Regulation as a Test.--There are several 
possible activities within DOE sites that could be considered as test 
cases for NRC regulation and licensing, beyond the pilot projects 
already conducted. These include the Low Level Waste Dumps at DOE 
sites, and possibly reactors like the Fast Flux Test Facility (FFTF) at 
the Hanford site. Currently, DOE's LLW landfills do not even approach 
NRC's standards, and are a clear threat to the groundwater at many 
sites. There are already a clear set of standards and infrastructure in 
place, including delegated state programs. Finally, many of DOE's LLW 
dumps are de facto illegal hazardous waste/Resource Conservation and 
Recovery Act (RCRA) dumps, due to DOE's inability to properly track and 
characterize its waste. If the FFTF were restarted, it should be 
licensed and regulated by NRC, and meet modern safety standards. 
Specific facilities at DOE should be reviewed and considered for NRC 
regulation. However, NRC should be prevented from going to informal 
rulemaking that could subvert the intent of better, more accountable, 
regulation.
                               conclusion
    In conclusion, the Alliance for Nuclear Accountability strongly 
urges the committee to move forward with at least some parts of an 
external regulation program for DOE as soon as possible. The creation 
of the National Nuclear Security Administration has resulted in a 
number of problems for the protection of the environment, worker 
safety, and public health. These can be partially addressed by 
legislative remedies and amendments to the NNSA act. Fundamentally, DOE 
or NNSA as self-regulated entities cannot persist without seriously 
compromising safety and health. After 50 years of environmental and 
safety disasters, it is time to bring DOE into the future.
                               addendum:
    The Committee asked for input on two other bills, HR 3383 and HR 
3906. With regards to HR 3383, we strongly endorse this bill and urge 
you to proceed with it without delay. It strains credulity that the 
sole enforcement mechanism available to DOE for nuclear safety 
violations cannot be used against the University of California (UC), 
one of the largest contractors in the weapons complex. UC has the 
contracts for the weapons laboratories, which are the source of many 
serious accidents and will be the source of many future problems. These 
labs are in ongoing operations with some of the most hazardous material 
known to humanity. They are now subject to fines and penalties for 
security program violations. Surely the protection of the American 
public and nuclear workers from radiation hazards deserves as much.
    We have no opinion on HR 3906 at this time.
    [GRAPHIC] [TIFF OMITTED] T4001.001
    
    [GRAPHIC] [TIFF OMITTED] T4001.002
    
    [GRAPHIC] [TIFF OMITTED] T4001.003
    
    Mr. Barton. Thank you, and I want to say in defense of the 
minority that is not here, we do have a pending bill on the 
floor that is a subcommittee bill, so that many of the 
subcommittee members on the minority side would be here if it 
were not for the fact that they were engaged in the debate on 
the floor.
    I would now like to hear from Dr. Adelman for 7 minutes. 
Your testimony is in the record in its entirety.

                  STATEMENT OF DAVID E. ADELMAN

    Mr. Adelman. Thank you, Chairman Barton and members of the 
subcommittee for giving me the opportunity to testify today.
    My remarks will focus on external regulation of the 
Department of Energy. I want to commend Chairman Barton and the 
other subcommittee members for introducing H.R. 3907, which 
represents an important step toward reforming the DOE 
regulatory system.
    And I urge you to continue to work toward developing a 
comprehensive bill that will fully address the many complex 
issues raised by shifting to external regulatory oversight of 
DOE.
    As this subcommittee is well aware, self-regulation is 
unique to DOE and has been an unqualified failure. DOE's 
deficient self-regulation has resulted in the largest 
environmental cleanup in history, over 10,000 individual sites 
at which toxic or radioactive substances were improperly 
abandoned or released directly into the environment, millions 
of cubic meters of contaminated soil and groundwater, at a 
total remediation cost of almost $200 billion.
    Moreover, chronic lapses in compliance with environmental, 
safety, and health regulations continue at DOE sites as 
evidence by the recent revelations of failed regulatory 
compliance at DOE's Paducah, Kentucky facility, which has led 
to a major DOE investigation and Congressional hearings; major 
accidents, including two fatalities and more than $2 million in 
environmental and safety fines at DOE's Idaho site; and recent 
findings of inadequate safety standards at Los Alamos, 
Livermore, and Savannah River by the Defense Nuclear Facilities 
Safety Board.
    Clearly, DOE's self-regulation is not working. After 
reviewing DOE's regulatory record, it is no wonder that its 
Advisory Committee on External Regulation, which was composed 
of government, nuclear industry, and NGO representatives, found 
that the severe problems with DOE's approach to safety have 
their roots in DOE's unique regulatory history and current 
regulatory framework, and that essentially all aspects of 
safety at DOE's nuclear facilities and sites should be 
externally regulated.
    This subcommittee's efforts to develop legislation to end 
DOE's self-regulation is therefore extremely important, 
particularly in light of Secretary Richardson's untimely and 
regressive decision in February 1999 to abandon external 
regulation of DOE facilities.
    There are, however, several critical issues that should be 
addressed before the proposed legislation proceeds: First, 
public participation, including citizens suits, should be 
integral to external regulation of DOE.
    Citizen suits have been important for over two decades. It 
was a citizen suit in 1984 that required DOE to comply with 
environmental, health, and safety regulations, and more 
recently it was a citizen suit brought by several workers at 
Paducah that exposed the problems at DOE's Paducah facility.
    Public scrutiny enforcement is essential to agency 
accountability, particularly where, as here, state and Federal 
agencies will be enforcing laws against another government 
entity. Furthermore, making itself fully accountable to the 
public is the only way that DOE will restore its credibility.
    Second, the National Nuclear Security Administration must 
be subject to external regulation. As the DOE's own advisory 
committee found, the only area of DOE operations that arguably 
should be exempt from external regulation is nuclear explosive 
safety.
    Indeed, virtually all of the information that is relevant 
to the safe operation of DOE facilities will not be classified. 
In any event, the NRC has well established procedures and 
experience with handling classified information.
    Therefore, there is no basis upon which to treat NNSA 
facilities differently than other sites in the nuclear weapons 
complex.
    Third, with some 34 sites containing 3500 nuclear 
facilities, the transition to external regulation will take 
time. Consultations with each of the agencies and review of 
existing reports and pilot projects will be essential to 
identifying a reasonable transfer period.
    However, establishing a deadline or series of deadlines for 
transferring regulatory authority will be essential to ensuring 
that it is successful and timely.
    The importance of external regulation of DOE cannot be 
overemphasized. As DOE itself concluded in 1996, external 
regulation is an essential element of completing the move from 
DOE's historical self-regulated status, which has been 
variable, costly, and inconsistent, to a stable, efficient, and 
predictable safety environment.
    I appreciate your giving me the opportunity to testify 
today, and would be pleased to answer any questions.
    Mr. Largent [presiding]. Thank you, Dr. Adelman. We 
understand our last witness is still tied up in a Senate 
hearing, and with unanimous consent, we will allow Mr. Miller 
to submit his testimony for the record.
    [The prepared statement of David E. Adelman follows:]
   Prepared Statement of David E. Adelman, Project Attorney, Natural 
                    Resources Defense Council, Inc.
    Chairman Barton, ranking minority member Hall, and members of the 
Subcommittee, my name is David Adelman. I am a project attorney with 
the Natural Resources Defense Council (``NRDC''), a national non-profit 
environmental organization with over 400,000 members and a staff of 
about 190 scientists, attorneys, resource specialists, and support 
staff. I am the project attorney for NRDC's nuclear program, which for 
over twenty-five years has actively worked to address serious 
environmental, health, and safety problems at the Department of 
Energy's (``DOE'') nuclear weapons production complex.
    Thank you for allowing me to address the issues related to external 
regulation of environment, health, and safety at DOE's facilities. 
There are three central issues I will address in my testimony. First, 
DOE's self-regulation of environment, safety, and health, continues--
after more than fifty years--to be plagued by deficiencies, chronic 
violations, and accidents. Second, fundamental regulatory reform is 
necessary to ensure that the environment, worker health and safety, and 
public health and safety are adequately protected and that public 
confidence in DOE is restored. Third, for a new regulatory regime to be 
effective and credible, citizen participation--particularly citizen 
suits--must be at the heart of the new regime.
    The bill, H.R. 3907, that the Committee members have introduced is 
a clear step in the right direction in reforming the DOE regulatory 
system, and I urge you to continue to work towards developing a 
comprehensive bill that will fully address the many complex issues 
raised by transitioning from the current state of DOE self-regulation 
to external regulation by the Occupation Safety and Health 
Administration (``OSHA''), the Nuclear Regulatory Commission (``NRC''), 
and the Environmental Protection Agency (``EPA''). Such legislative 
action by Congress is all the more important in light of Secretary 
Richardson's reversal of the Department's December 1996 decision to 
submit legislation to Congress on external regulation. There are, 
however, several critical issues that must be addressed before the 
proposed legislation proceeds, including:

(1) ensuring that there is adequate funding--DOE estimates it spends 
        about $1.5 billion annually on safety and health regulation; 
        1
---------------------------------------------------------------------------
    \1\ Department of Energy, Report of Department of Energy Working 
Group on External Regulation 3-11 (1996) (hereinafter ``DOE Working 
Group Report'').
---------------------------------------------------------------------------
(2) developing plans to ensure that the external regulators have the 
        personnel necessary to provide competent oversight;
(3) adding a provision to the legislation granting citizens the right 
        to bring enforcement actions;
(4) making it explicit that the National Nuclear Security 
        Administration is also subject to external regulation; and
(5) affording adequate time for a smooth and efficient transition from 
        DOE self-regulation to external regulatory oversight.
          i. the failure of self-regulation at doe facilities
    Under current law, DOE is a largely self-regulating agency pursuant 
to the Atomic Energy Act. That is, as a general rule, the DOE is not 
subject to regulation and oversight by any external administrative 
entity. Instead, it is responsible for regulating its own activities in 
regard to worker and public health and safety and in regard to most 
types of environmental discharges of radioactive materials. The 
relatively new Defense Nuclear Facilities Safety Board can make 
recommendations to DOE on safety issues; but these recommendations are 
non-binding, and the Board has no regulatory power over DOE's 
activities.
    This self-regulation scheme is utterly unique to the Department of 
Energy. The American legal system has, in every other context I can 
think of, soundly rejected the concept of self-regulation. Except as 
regards the DOE, our legal system correctly rejects the notion that an 
entity with a mandate for production can effectively ensure, without 
outside assistance, that this production mandate will not overwhelm or 
supersede the need to protect the environment and human health and 
safety. The exceptional nature of the DOE regulatory system is all the 
more astonishing in that the production of nuclear weapons involves 
producing, handling, managing, and disposing of some of the most 
dangerous substance known to humankind.
    If we view the DOE experience as an experiment in whether self 
regulation can work, it is clear that the experiment has been an 
unqualified failure. The statistics are stark. Nuclear weapons 
production at DOE facilities has resulted in the largest environmental 
cleanup in the world, involving more than 100 facilities located in 
more than 25 states, an annual budget of almost $6 billion, and 
conservative estimates of total cleanup costs of approximately $200 
billion.
    To date, DOE has identified over 10,000 individual sites at these 
facilities where toxic or radioactive substances have been improperly 
abandoned or released directly into soil, groundwater, or surface 
waters. Under current estimates, nuclear weapons production in the 
United States has resulted in the contamination of more than 79 million 
cubic meters (21 billion gallons) of soil and 1.8 billion cubic meters 
(475 billion gallons) of groundwater--in comparison, the Exxon Valdez 
spill involved the release of 11 million gallons of oil. In addition, 
DOE manages more than 24 million cubic meters (6.4 billion gallons) of 
hazardous or radioactive wastes generated by past and ongoing nuclear 
weapons production.
    Moreover, despite efforts to improve the regulation of activities 
at DOE sites, serious incidents and lapses in health and safety 
regulation continue to occur. At DOE's Paducah, Kentucky, uranium 
enrichment plant, evidence was recently uncovered of alleged illegal 
disposal of radioactive and hazardous wastes and chronic failure to 
comply with basic environmental and safety regulations, such as 
inadequate employee monitoring, widespread contamination in the plant 
cafeterias, and failure to identify and cordon off hazardous areas. 
Compounding these problems, in 1998 DOE determined that the Paducah 
contractor had illegally retaliated against a worker who had raised 
significant safety concerns.
    Similar lapses and violations are pandemic at many other DOE 
facilities. At DOE's site in Oak Ridge, Tennessee, an explosion in 
December 1998 involving hazardous materials injured 11 workers and was 
blamed on weak safety standards. In July 1998, DOE's Oak Ridge 
contractor was fined more than $400,000 for illegal dumping of 
radioactive and hazardous wastes in a local landfill and widespread 
mislabeling of wastes. And in 1995, DOE's Oak Ridge contractor was 
found to have withheld information about significant radiation 
exposures of workers and to have falsely claimed that numerous test 
results of radiation exposure for workers were negative.
    At DOE's Idaho National Engineering and Environmental Laboratory, 
DOE fined its own contractor $22,000 in August 1999 for problems with 
waste containers, unreliable emergency notification systems, and 
failure to correct adequately prior safety violations. Weak 
environmental and safety programs at DOE's Idaho site have led to three 
major accidents, including two fatalities, and more than $2 million in 
fines for missing cleanup deadlines, hazardous waste violations, and 
accidents that exposed workers to unsafe levels of radiation. These 
violations have included falsifying safety records, such as in October 
1997 when DOE fined its Idaho contractor $55,000 for falsifying records 
that testing of nuclear reactor safety systems had been conducted when 
in fact these crucial tests had not been performed.
    DOE's Hanford, Washington, facility, which is the site of the most 
costly, dangerous, and technically challenging cleanup actions, also 
continues to suffer from poor environment, health, and safety 
oversight. In April 1999, for example, DOE and its contractors were 
fined for inadequate monitoring of several Hanford storage tanks 
containing high-level nuclear wastes, which store some of the most 
hazardous materials found in the DOE complex. Indeed, the long-standing 
deficiencies of self-regulation are a tradition at Hanford, where in 
1959 DOE identified significant leaks in single-shell high-level waste 
tanks, but because of production pressures continued to build them 
until 1964 and to introduce wastes into them until 1980--causing 
millions of cubic meters of groundwater and soil to become 
contaminated.
    The major production and research sites, i.e., Los Alamos, 
Livermore, and Savannah River, are no different. In 1999 the Defense 
Nuclear Facilities Safety Board found health and safety regulation at 
these facilities to be seriously deficient--last summer, for example, a 
major fire occurred at Los Alamos involving plutonium. Putting this in 
a broader context, in a 1993 internal Department review found that 
``DOE facilities . . . have been averaging around 64,00 reportable 
items of non-compliance with OSHA standards per year over the past two 
years.'' 2 It is therefore clear that DOE self-regulation 
continues to fail to protect the environment, worker health and safety, 
and the public.
---------------------------------------------------------------------------
    \2\  Advisory Committee on External Regulation of U.S. Department 
of Energy Nuclear Safety, Improving Regulation of Safety at DOE Nuclear 
Facilities 12 (1995) (hereinafter ``Advisory Committee Report'').
---------------------------------------------------------------------------
    In its December 1995 report, DOE's Advisory Committee on External 
Regulation, which was composed of a broad range of government 
officials, nuclear industry representatives, and stakeholders, 
identified the same kinds of ``symptoms'' that DOE environment, health, 
and safety regulation have been and are seriously flawed:

 Poor safety practices have and continue to cause major 
        problems, such as extensive contamination of sites throughout 
        the DOE complex and historical exposure of workers and local 
        populations to large releases of radioactive materials.
 The public and government officials believe that fiscal and 
        personnel resources are not being effectively used in 
        undertaking the stabilization, decommissioning, and cleanup of 
        DOE facilities.
 The public and government officials fundamentally distrust 
        DOE.
 DOE's workers are profoundly frustrated by the ``regulatory 
        morass that often impedes rather than aids'' their efforts.
 DOE activities continue to be plagued by non-compliance with 
        safety requirements.3
---------------------------------------------------------------------------
    \3\ Advisory Committee Report at 14.
---------------------------------------------------------------------------
    The Advisory Committee concluded that the root causes of these 
problems were the following:

 the built-in conflict of interest between safety and mission 
        under self-regulation;
 a legacy of secrecy that has historically shielded DOE's 
        operations and activities from outside view;
 lack of stability in safety management and policy;
 lack of management accountability and inadequately coordinated 
        regulatory and oversight functions;
 redundant, confusing safety requirements; and
 lack of balance in addressing hazards.4
---------------------------------------------------------------------------
    \4\  Advisory Committee Report at 14-15.
---------------------------------------------------------------------------
    In concluding, the Advisory Committee found that ``[t]he severe 
problems the Committee has identified with DOE's approach to safety 
have their roots in DOE's unique regulatory history and current 
regulatory framework.'' Advisory Committee Report at 15. It was with 
these factors in mind that the Advisory Committee concluded that 
``essentially all aspects of safety at DOE's nuclear facilities and 
sites should be externally regulated.'' Id. at 2.
    In NRDC's view, the profound problems of radioactive and toxic 
contamination and failed worker health and safety protection throughout 
the nuclear weapons complex provide all the evidence necessary to 
conclude that self-regulation has failed. We must ensure that this does 
not occur again, and we must start by rejecting the self-regulation 
system that allowed it to occur. As DOE itself concluded in 1996, 
``[e]xternal regulation is an essential element of completing the move 
from DOE's historical self-regulated status, which has been variable, 
costly, and inconsistent, to a stable, efficient, and predictable 
safety environment. DOE Working Group Report at 1-1.
            ii. self-regulation undermines doe's credibility
    The environment and human health and safety were not the only 
casualties of DOE's self-regulation. DOE's credibility with the 
American public has suffered nearly as much damage as the soil and 
groundwater polluted by the nuclear weapons complex. Many DOE 
administrators have acknowledged this loss, observing in one case that 
DOE's credibility could not be sold if it were listed as a blue-chip 
stock on Wall Street.
    Public confidence in DOE continues to be extraordinarily low. Many 
of the sources of this credibility crisis lie in DOE's scheme of self-
regulation. For years the Department told the public that its 
operations were safe and clean, that it was taking care of the 
environment and human health and safety, and that there was nothing to 
worry about. The truth, of course, turned out to be much different than 
that, and as a result the public feels betrayed and lied to. It is 
unreasonable to expect the public to trust the DOE to police itself 
effectively when its operations have caused such profound harm and its 
operations continue to be plagued by environment, health, and safety 
incidents and violations.
    At a November 1993 speech on risk management at the National 
Academy of Sciences, then Assistant Secretary Thomas Grumbly expressed 
the point aptly when he said: ``Sometimes credibility means giving up 
control.'' This is one of those cases. For the public to have 
confidence in the safety and effectiveness of DOE's activities, DOE 
must release regulatory control to an independent body. As DOE recently 
acknowledged, ``DOE's credibility will be enhanced by the open process 
inherent in external regulation and the public perception that DOE will 
be complying with generally applicable and widely accepted 
requirements.'' DOE Working Group Report at 1-2. In short, external 
regulation is a necessary and essential step DOE must take to overcome 
its legacy of environmental mismanagement and failed protection of 
human health and safety.
   iii. citizen participation is a necessary component of effective 
                          external regulation
    DOE's Advisory Committee on External Regulation concluded that in 
order to have a credible and effective regulatory system, citizens must 
have the right to active involvement in its implementation. DOE 
Advisory Committee Report at 6, 27-29. Citizen participation takes 
different forms at each stage of the regulatory process, but the most 
critical component is the right to bring citizen suits. Similarly, 
states must also have a central role in the new regulatory scheme, 
including the right to enforce DOE's obligations under external 
regulation. Id. at 29-30. Further, it is essential that any external 
regulator of DOE be given the power to impose administrative penalties, 
such that challenges to such penalties would have to go through an 
administrative process at OSHA or NRC before being resolved by the 
Department of Justice--and citizens and states would have opportunities 
to intervene in these adjudications.
    An effective regulatory system must perform at least three 
conceptually distinct functions. First, it must set standards and 
requirements under which the regulated entity will operate and under 
which licensing decisions will be made. Second, it must administer the 
licensing system. Third, it must enforce the obligations that are 
imposed on licensees either as conditions attached to licenses or under 
generally applicable regulations. Certain principles must apply across 
these three regulatory activities; in particular, the external 
regulator must operate independently of the regulated entity and the 
regulatory regime must be transparent to the maximum extent 
practicable. And the public must be provided with not just the 
conclusions reached (``yes, the facility is safe'') but also with the 
basic information and analyses supporting such determinations. The 
long-standing closed structure of the DOE regulatory regime is a major 
reason why the public views it with such distrust.
    Accordingly, any legislation mandating external regulation should 
make it clear that under established principles of administrative law, 
citizens will have the right to participate in the notice-and-comment 
rulemaking process and to seek judicial review of the adequacy of 
standards once they have been promulgated. Citizens should also have 
the right to participate fully in all licensing proceedings and to seek 
judicial review of all licensing decisions. Finally--and most 
importantly--for external regulation to be effective and credible, the 
public must have the right to bring citizen suits in federal court to 
enforce applicable regulations.
    As this Subcommittee no doubt knows, citizen suits have a long and 
effective history as a method of enforcing federal law. Their most 
familiar and obvious role is in the body of federal environmental laws 
enacted since 1970, which rely in significant part on citizen suits as 
an enforcement mechanism. But citizen suits have a long pedigree in the 
Anglo-American legal system, dating back 600 years and including such 
actions as the citizens informers' action and qui tam action. They are 
critical because federal agencies with authority to enforce laws often 
lack the fiscal resources or the political will to rein in violators. 
Experience has shown that it can be particularly difficult for state 
and federal agencies to enforce laws against other government agencies. 
Moreover, citizen suits often achieve the desired enforcement objective 
without the need for a full, drawn-out lawsuit.
    In addition to their unique effectiveness, full public 
participation and citizen suits should be integral to the external 
regulation of DOE in order to address DOE's lack of credibility with 
the public. By opening the doors of the regulatory process to citizens, 
DOE would be in a position to win back an important measure of 
credibility it has lost. Much credibility would flow from the DOE 
demonstrating to citizens that it is prepared to be held accountable by 
citizens for its obligations under the law.
iv. legislating the transition to external regulation of doe facilities
    For more than a decade, NRDC has been a strong proponent of 
external regulation for the Department of Energy. However, making the 
transition from self-regulation to regulation by several external 
entities must be done carefully. The DOE nuclear weapons complex is 
comprised of 16 major sites and more than a hundred smaller ones 
containing 3,500 nuclear facilities and extending over 2.1 million 
acres. The NRC has estimated that it could need as many as 1100 to 1600 
more staff members and $150-200 million annually to regulate nuclear 
safety at DOE facilities. Advisory Committee Report at 41. DOE 
estimates that its current annual expenditures on safety and health are 
$1.5 billion, which suggests that NRC's cost estimates are likely not 
unreasonable. Accordingly, it will be essential to provide both 
adequate funding to the NRC and OSHA to take over responsibility for 
regulating DOE and sufficient time for the transition from DOE self-
regulation to NRC, OSHA, and EPA external regulation. Further, given 
that DOE has projected that such a transfer could take more than five 
years, complete transfer of regulatory authority to OSHA and NRC by 
October 1, 2001, is almost certainly too ambitious.
    There are two issues that are of critical importance to the 
proposed legislation. The first is that the Atomic Energy Act should be 
amended to afford adequate public involvement--particularly citizen 
suits--which I have discussed in the preceding section. The second is 
that it should be made explicit in the legislation transferring 
regulatory authority that both DOE and the National Nuclear Security 
Administration (``NNSA'') will be subject to external regulation. The 
only area of DOE operations that the DOE Advisory Committee determined 
should not be subject to external regulation was ``nuclear explosives 
safety.'' Advisory Committee Report at 34. Specifically, external 
regulation should not apply to the safety of the nuclear explosive 
device itself. ``However, all aspects of operations with nuclear 
explosives other than nuclear explosives safety . . . should be subject 
to external regulation, and the regulator would have access to the 
information necessary to determine whether nuclear explosives 
operations conformed to safety standards.'' Id.
    Most of the information that is relevant to the safe operation of a 
facility, including safety systems and siting plans, will likely be 
unclassified. And, in any event, the NRC has both experience with and 
procedures for handling classified information. See 10 C.F.R. Parts 10, 
11, 73, and 95. Indeed, the NRC has licensed facilities with important 
national security functions, including the naval reactor fuel facility 
at Erwin, Tennessee. Therefore there is no reason to exclude NNSA 
facilities from the external regulation being proposed for DOE; to the 
contrary, the long history of failed self-regulation mandates that 
external regulation of activities within the nuclear weapons complex 
include all NNSA facilities.
    In a closely related matter, it is also critical that the 
legislation from last session creating the NNSA be amended to protect 
existing state authority to impose and enforce environmental 
regulations at NNSA facilities. Specifically, Sections 3261 and 3296 of 
Title XXXII of the Fiscal Year 2000 Department of Defense Authorization 
Bill should be clarified. NRDC is concerned that the language ``all 
applicable environmental, safety, and health statutes and subsequent 
requirements'' and ``all provisions of law and regulations in effect 
immediately before the effective date of this title'' could be 
interpreted as referring only to federal laws and regulations. However, 
the Federal Facilities Compliance Act of 1992 explicitly waived federal 
sovereign immunity and required the federal government to adhere to 
state environmental regulations when cleaning up hazardous, 
radioactive, and mixed hazardous and radioactive wastes at federal 
facilities. Like all other federal facilities, NNSA sites should 
subject to state laws governing the cleanup of hazardous and 
radioactive wastes. As the National Governors' Association, National 
Conference of State Legislatures, and others have recognized, it is 
essential that this ambiguity in the NNSA legislation be rectified.
    There are several additional changes in the proposed legislation 
that should be considered. First, NRC regulatory authority is currently 
limited to hazards from source, special, and byproduct material, but 
does not include other sources of radiation (i.e., accelerator-produced 
radiation or materials and naturally occurring radioactive materials) 
or non-radiological hazards, all of which are regulated by DOE under 
Section 161(i)(3) of the Atomic Energy Act. Such gaps in NRC regulatory 
authority under the Atomic Energy Act should be closed as part of any 
legislation to transfer regulatory authority to the NRC. Second, 
external regulation of nuclear safety and worker health and safety 
should not be limited to OSHA and NRC; rather, where a state can 
demonstrate that it has the capacity to regulate DOE operations, 
regulatory authority should be delegated to the state in which the 
facility is located. Third, to minimize jurisdictional conflicts, NRDC 
strongly endorses the use of a cooperative approach by the regulatory 
agencies based on designation of a ``Lead Agency,'' just as occurs 
under the Superfund Act, for specific elements of decommissioning and 
cleanup activities. See Advisory Committee Report at 26.
                             v. conclusion
    As I hope my testimony demonstrates, the question of external 
regulation of the Department of Energy is of profound importance. We at 
NRDC believe that the DOE will be unable to make further progress on 
any of the daunting issues facing it until the Department fixes the 
systematic and corrosive problems caused by an inadequate, insular, 
secretive regulatory regime. The public simply will not trust DOE 
claims that it has corrected the deficiencies in its regulatory 
oversight--which have led to countless violations and accidents and 
resulted in the largest and most costly environmental cleanup in the 
world--until DOE is made an accountable agency. The sponsors of this 
legislation deserve significant credit for proposing a bill that, while 
needing several critical modifications, moves in the right direction by 
seeking to end the era of DOE self-regulation.
    Fortunately, considerable thought and effort have been dedicated to 
addressing how to make the transition from DOE self-regulation to 
external regulation by NRC, OSHA, and EPA. The 1995 report of DOE 
Advisory Committee on External Regulation is particularly useful, as 
well as the 1996 DOE Working Group Report. In addition, prior to 
Secretary Richardson's untimely rejection of external regulation in 
February 1999, both OSHA and the NRC were working with DOE to develop 
concrete plans for making the transition to external regulation, which 
also provided important information on and insight into how to 
structure the transition to external regulation. These pilot projects 
should be revived and a dialogue reopened with Secretary Richardson to 
revitalize DOE's efforts to move towards external regulation.
    Thank you again for giving me the opportunity to testify today. I 
would be pleased to answer any questions.

    Mr. Largent. Ms. Jones, I'd like to ask you a question, 
first, if I could. Do you believe that the security oversight 
in the Department of Energy will be improved or at least 
protected from future erosion if the Office of Independent 
Oversight is established in statute?
    Ms. Jones. I think here that your term, protected from 
future erosion, is a good way of putting it. I think our 
testimony notes that one of the benefits of legislatively 
establishing this office is so that there isn't backsliding by 
the Department.
    We have noted that this office was several layers down 
within ES&H in 1999, and it was even part of a programming 
division earlier than that.
    So I think that's the one benefit of this legislation is 
that it will elevate it and keep that elevation.
    Mr. Largent. Okay. Dr. Adelman, I was looking at your 
testimony, and you talked about the necessity of having an 
independent oversight of DOE. And it said--hold on here just a 
second--you made a point in your testimony that for DOE to 
regain public confidence, it must give up regulatory control to 
an independent body.
    But your statement is really at odds of that of Mr. Conway 
who claimed that external regulation will have no effect on 
DOE's credibility with the public.
    How do you explain such a difference of opinion there 
between yourself and Mr. Conway?
    Mr. Adelman. Well, I'm not sure that I can explain his 
opinion, but certain from the perspective of public interest 
groups that have worked on these issues for a long time, 
transferring regulatory oversight, making it more transparent, 
allowing fuller public participation is an essential ingredient 
to DOE regaining its confidence with the public.
    And this is something that NRDC and many other groups have 
been promoting for over a decade now. And DOE, until relatively 
recently, was very supportive of it.
    Mr. Largent. Why do you think DOE has changed tactics in 
terms of being opposed to this now?
    Mr. Adelman. It's a question that we have. They're claiming 
right now that there are a number of institutional barriers 
that could potentially make the transfer more difficult. 
However, it's hard to imagine that those sorts of 
considerations like harmonizing NRC's regulations with DOE's, 
having to integrate current DOE safety and health regulations 
weren't something the Department was aware of in 1996 when it 
chose to undertake significant movement toward external 
regulation.
    So, as far as we're concerned, we haven't heard any 
substantive reasons for them to reject external regulation at 
this time.
    Mr. Largent. But they are rejecting external regulation.
    Mr. Adelman. Apparently.
    Mr. Largent. Yes. Ms. Eldredge, I wanted to ask you a 
question about the Defense Board, and the question is, do you 
have any concerns or do you believe that the Defense Board may 
have become too close to the national security mission it's 
trying to regulate?
    Ms. Eldredge. The problem with the two options for 
regulators that were put out in the 1995 committee and in other 
reports is that it has looked at the NRC and the Defense Board, 
both of which have problems. You might say NRC is too close to 
the nuclear industry which it regulates, and I think the 
Defense Board suffers from the same problems in terms of its 
relationship to DOE.
    That being said, it also has a tremendous amount of 
expertise that NRC lacks with regards to some of the weapons 
programs. So, we haven't really made a conclusive decision on 
which way we'd rather go with them.
    It's been our problem to date, but we do think that what 
ever happens, both need to maintain and support the technical 
expertise of the Defense Board, and perhaps one of the thoughts 
had been moving them somehow into the NRC structure. Also do 
some reforms on NRC or the Board, whichever the direction went, 
in terms of their openness to the public, their citizen suit 
provisions, and their behavior as a regulator to make them more 
accountable.
    Mr. Largent. Dr. Shank, I wanted to ask you a question. You 
talked about H.R. 3906 imposing yet another new layer of 
bureaucratic management and oversight.
    Since the Office of Independent Oversight already exists at 
DOE, isn't your lab already subject to the oversight of that 
office?
    Mr. Shank. Yes.
    Mr. Largent. So how would H.R. 3906 impose, ``yet another 
new layer of bureaucratic management and oversight?''
    Mr. Shank. I think the question that I'm concerned about is 
that it applies to all entities of the DOE. In a laboratory 
like ours, in which we do not perform classified work, this 
entity does apply to that.
    I feel that it is an additional burden that our science 
programs must bear, and anytime I have a chance to speak out 
against that, I will.
    Mr. Largent. And do you feel like the cost, regulatory 
cost, exceeds the benefit?
    Mr. Shank. Well, if you do not have an issue with national 
security, adding a burden on science performed in DOE 
laboratories, especially laboratories like ours which are open 
to the world, it is an additional cost with no benefit 
whatsoever, as far as I can see.
    Mr. Largent. Well, I guess the only issue that I would like 
to raise is that it seems to me that we've transferred a lot of 
technology to China, for example, some of it openly, some of it 
clandestinely, that on the face of it, didn't seem to have 
national security implications.
    But, in fact, the application of that technology was 
transferred to where it is a national security risk.
    So how can you say that one particular type of research 
would not potentially, if transferred and into the wrong hands, 
have risks to our national security?
    Mr. Shank. I think there are different ways of looking at 
this. The nature and character of work that goes on at our 
laboratory is very similar to the type of work that goes on at 
universities across the country, at other businesses across the 
country.
    We have to weigh our openness in science with the benefits 
that we gain. We support about 2 percent of the world's 
science. We cannot operate and be effective in the world, 
unless we have the ability to interact.
    We benefit more than we lose by interacting with the 
world's scientific community.
    A third of the people at our laboratory are not American 
citizens. They provide an enormous positive input to our 
scientific programs, in building businesses in the United 
States.
    I think that if we focus and look inward and cut ourselves 
off from the scientific community with excessive zeal, we will 
no longer be the partners of international scientific 
consortia, and we will have less to learn from the rest of the 
world.
    Mr. Largent. I guess what we're trying to seek to find here 
is some sort of balance.
    And, of course, I believe that's the key to life, is 
finding some sort of balance, as opposed to swinging from one 
extreme to another.
    And the issue really is, how can we provide--you mentioned 
in your response that there are a lot of ways to look at this.
    And I think that one of the ways that this committee and 
this subcommittee has to look at it, first and foremost, at the 
highest priority, has to be from a national security 
perspective. That's the way we have to look at it.
    I think that's the fundamental responsibility of the 
Federal Government, is to provide for the safety and security 
of our constituents.
    And so the question is, how do we do that in the least 
intrusive way, the least regulatory way, and still allow for 
the communication that is necessary for scientists to be able 
to communicate with one another to forward their projects and 
research, and at the same time, ensure that we're protecting 
the national security interests that we have?
    Unfortunately, so often here at the Federal level, we are 
forced into a one-size-fits-all mandate that doesn't fit the 
research that's being conducted at your facility very well, but 
actually helps protect us in other facilities.
    I'm just wondering if you have ideas or thoughts on ways 
that we can build this legislation in such a way that we are 
protecting national interests and security, in the least 
regulatory and burdensome way?
    Mr. Shank. I think the focus should be on the work. It 
should not be on who does the work.
    I think that if the work is done in universities and at 
laboratories, that's where the focus ought to be, on what it 
is, what the topic of the work is.
    I think that placing a burden on science at DOE 
laboratories, and disconnecting us from the scientific 
community, will inevitably put us in such a position that we 
will not have anything to secure.
    Mr. Largent. At this time, I will yield to my colleague 
from Florida, Mr. Stearns.
    Mr. Stearns. The Federal witnesses claimed 1 year is not 
enough time to transition to external regulations. And the NRC 
asked for ten, so I guess what's the difference and what's the 
discrepancy and what do you think? Ms. Eldredge?
    Ms. Eldredge. I do think 1 year is too short. It's a rather 
big task to shift this over.
    In talking to some of the DOE people I have spoken to 
around the laboratories, they thought for a transition to OSHA, 
a 2-year timeframe was reasonable and certainly could be 
accomplished, and that was at the Defense labs.
    In the case of NRC, I think 10 years is rather excessive. 
You can almost graduate from high school in that amount of 
time.
    And I think a better timeframe might be five, but that's 
just off the top of my head. I think that what most needs to 
happen is that there has to be a time line and some 
requirements to be met, so that they don't turn around in 5 
years and say, oh, well, we haven't quite started yet, and give 
us another 5 years.
    Mr. Stearns. If they want 10 years, they might want more.
    Ms. Eldredge. Right, they might want 20 Mr. Stearns. Yes, 
20, yes. Ms. Jones?
    Ms. Jones. Mr. Stearns, from our testimony, while I can't 
give you a magic number in terms of how long it's going to 
take, we did feel it would take longer than the time period 
provided in the legislation.
    And the one point on that was that we were concerned about 
the defense facilities. They were not part of the pilot 
program, so while NRC and OSHA do have some interest and 
understanding of them, we believe that more study was needed.
    And one way that you might want to go, as you move forward 
in having NRC and OSHA regulate the non-Defense facilities, is 
to pilot one of the large Defense facilities to give you more 
information about some of the issues like national security 
concerns, costs, those kinds of things.
    Mr. Stearns. Anyone else like to comment? Dr. Adelman?
    Mr. Adelman. I would agree that 1 year is a very short time 
period within which to transfer full regulatory authority over 
to NRC, and even OSHA.
    I think that there are a few things to keep in mind: The 
importance of a timeline is obviously essential, but also 
focusing on different stages of the transfer.
    One of the things that I think we view as most significant 
here is that if you shift regulatory authority over to NRC, it 
doesn't mean that the key date is when that regulatory 
authority actually transfers. A lot is going to happen prior to 
that, and a lot of improvements, we hope.
    So, establishing a time line with clear goals and an open 
process is really what should be focused on.
    Mr. Stearns. Yes, sir, Dr. Shank?
    Mr. Shank. As I pointed out in my testimony, even at a 
simple facility like the Lawrence Berkeley National Laboratory, 
there are many open issues that need to be resolved that are 
not resolved in this legislation in terms of who holds the 
license, whether there is going to be duplicative regulatory 
oversight; whether legacy issues are addressed and how they can 
be funded and who will be responsible in the future for those 
legacy issues.
    There is enormous complexity, even for a simple facility 
like ours to go forward with this.
    Mr. Stearns. Do you think 5 years is sufficient?
    Mr. Shank. I would take the judgment of the NRC.
    Mr. Stearns. Which is 10 years.
    Mr. Shank. I have no way--they talked about a three-step 
program, each one taking 5 years, if I recall in the testimony.
    Mr. Stearns. That would give you 15, a three-step program 
at 5 years apiece.
    Mr. Shank. Yes.
    Mr. Stearns. Anyone else? Mr. Van Ness?
    Mr. Van Ness. I'd like to focus on the two defense 
laboratories with respect to this matter. The regulatory 
climate for the two defense labs has changed considerably for 
the better in the years since they supported external 
regulation before the DOE Advisory Committee on External 
Regulation, chaired by John Ahearne.
    The factors that drove support for that concept revolved 
around the issue of disparate, multiple, and oftentimes 
conflicting regulatory directions from DOE, which was causing 
confusion, high cost, and a dangerous lack of focus regarding 
improvement of ES&H.
    Since then, two major initiatives have been implemented 
which are now embedded in our organizations, as well as in our 
contracts, and these are work-smart standards, a process for 
determining what standards should be used to govern our work 
from an ES&H perspective, and integrated safety management, an 
approach that incorporates ES&H into the work, using a set of 
key principles and functions.
    The work-smart standards process engaged the DOE in the 
laboratories in collectively identifying the work, the 
associated hazards, and appropriate controls in a manner that 
many of the conflicting regulatory directions derived from the 
standards were and are being resolved.
    The applicable standards are now more clearly defined, more 
clearly identified, and agreed to by both DOE and the labs. The 
work-smart standards sets are now being effectively managed by 
a formal change control process at the laboratories.
    Integrated safety management has, in fact, taken hold at 
the laboratories, and is proving to be an excellent vehicle for 
doing work safely. It's been embraced by our workforce, because 
it's rational, it's flexible and it's site-specific.
    The results of ISM are evident in the significant 
performance improvements of the labs over the past few years, 
and in the success of integrated safety management verification 
teams that have been conducted by DOE during this past year.
    In fact, a very important issue now is that we sustain the 
initiatives and improvements that have taken hold since the 
mid-1990's so that critical cultural changes brought on by ISM 
continue. It is essential that the momentum that now exists 
around ISM be sustained and that approach be allowed to mature. 
Changing at this juncture to yet another regulatory approach 
could put that at serious hazard.
    It is important also to note that none of the external 
regulation pilot projects----
    Mr. Stearns. Mr. Van Ness----
    Mr. Van Ness. Yes?
    Mr. Stearns. Are you answering the question?
    Mr. Van Ness. Yes, I believe I am.
    Mr. Stearns. The question is----
    Mr. Van Ness. I am telling you that for weapons 
laboratories I don't think at any time the external 
regulation----
    Mr. Stearns. So you favor 10 years? You favor 10 years?
    Mr. Van Ness. I don't think that you should address 
applying external regulation to the weapons laboratories. I 
think the changes that have occurred----
    Mr. Stearns. So you don't want to apply anything to that?
    Mr. Van Ness. [continuing] at DOE are very effective.
    Mr. Stearns. You don't want to apply anything to them? In 
other words, are you advocating a 5-year, 2-year, 10-year or--
--
    Mr. Van Ness. No, I am advocating that you not apply 
external regulation to the weapons laboratories because the 
system that have been put in place since the mid-nineties are 
in fact working and we are seeing an improved safety situation 
at those laboratories----
    Mr. Stearns. So you cannot, you cannot transition to 
external regulation in that case?
    Mr. Van Ness. I am saying that would be an unwise thing to 
do.
    Mr. Stearns. No matter what time was provided?
    Mr. Van Ness. Yes.
    Mr. Stearns. All right. Thank you, Mr. Chairman.
    Mr. Largent [presiding]. At this time I would like to ask 
unanimous consent to enter the attached report by CRS into the 
record. This report addresses direct reporting from Executive 
agencies to Congress and also at this time recognize the 
gentleman from Ohio, Mr. Strickland, for questions.
    [The information referred to follows:]
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    Mr. Strickland. Thank you very much.
    Ms. Eldredge, you stated that several of the DOE labs 
believe they no longer have to comply with DOE environmental, 
health and safety rules because they are under a new security 
agency.
    Could you talk more about why you----
    Ms. Eldredge. It comes under the problem that has been 
talked about a lot of dual hatting that the Assistant Secretary 
for Environment, Safety and Health is now dual-hatted to be 
also for Environment, Safety and Health under the new National 
Nuclear Security Administration.
    However, the laboratories are not comfortable with this, 
and some Members of Congress are not either, and one of the 
results that is very clearly out there, from a legal 
perspective, is the Price-Anderson Act enforcement of nuclear 
safety rules. Normally under the rest of the Department if the 
Office of ES&H finds a violation they issue a notice of 
violation and they subject the violating DOE entity to fines 
directly. They have that delegated authority from the 
Secretary.
    Now they no longer have that delegated authority with 
regards to the NNSA, so if they find one of the weapons sites 
to be in violation they can put together their whole package 
but it is a recommendation, it is no longer a penalty, and make 
that recommendation to the Administrator of the NNSA, and then 
he or she would then have to impose a fine on the violator, 
so--and it creates a different kind of loop.
    You no longer have that kind of independent oversight that 
they had in the past. That is one piece of it. The other piece 
of it is that the Office of Environment, Safety and Health also 
has a number of rules and recommendations with regards to other 
non-nuclear safety issues. Unfortunately there is no 
enforcement program for them like there is for Price-Anderson, 
but they are still important rules for workplace safety and 
worker safety.
    This includes the new beryllium rule and there has been 
some indication--I do not have anything in terms of a real 
smoking gun on this--but there is some indication from some of 
the statements made in lab directors' testimony and some of 
what we are hearing from the labs. They do not believe that 
they need to take orders from the Office of Environment, Safety 
and Health, that they can create their own safety plans.
    Mr. Strickland. Well, Dr. Michaels has said to us recently 
that he no longer has the authority to issue notices of 
violations or to impose fines under Price-Anderson to the DOE 
weapons complex----
    Ms. Eldredge. Correct.
    Mr. Strickland. [continuing] that he can only recommend, as 
you say. Under that scenario, do you think it is worthwhile to 
pass legislation that would cover the nonprofit contractors?
    Ms. Eldredge. Regarding the fines for nonprofit contractors 
I definitely think the legislation is worth passing. It is sort 
of ridiculous that the contractor that has the contracts for 
the sites where we are going to have ongoing weapons work, it 
is going to continue into the foreseeable future, they are not 
cleaned up sites where people hope will be closed and walked 
away from in a couple decades, are not subject to the same kind 
of penalties and fines as all the other sites are, so I think 
that piece definitely needs to be corrected and support the 
legislation this committee has to do so.
    The piece about whether the Office of ES&H would get to 
enforce those fines once they were allowed I think needs to be 
also corrected in additional legislation.
    I am not sure that the bill that you have right now would 
cover that problem.
    Mr. Strickland. Okay, and one final question. You say that 
you don't know who the external regulator for nuclear issues 
ought to be. Congress probably is not going to establish a new 
regulatory agency for DOE so would you give us your best 
recommendation?
    Ms. Eldredge. That is a challenge. It is something we have 
been struggling with for a long time. Various advisory 
committees have also struggled with who would be the best 
regulator.
    The two names that pop up most frequently are the NRC and 
the Defense Nuclear Facilities Safety Board. Neither of them is 
perfect.
    As I mentioned earlier, if we were going to go with either 
of those, we would recommend reforms to those bodies, one of 
which would be citizen suit provisions so that we can hold 
whoever becomes the regulator accountable for their regulatory 
actions, and that would be both for the public and for the 
states, to be able to use that tool, which has been very 
effective with other environmental statutes.
    With regards to my best recommendation, I think I will have 
to get back to you on that. We probably would be able to come 
up with some sort of merged entity of NRC and the Defense Board 
with a package of reforms that would be more acceptable than 
just a hand-off right now.
    Mr. Strickland. Okay, and a final question then, and if 
each of you would respond.
    All of you seem to agree that there should be some phase-in 
of external regulation. You believe there should be external 
regulation. The proposed legislation would not allow for phase-
in. Do you think an all-or-nothing approach is feasible and you 
could just give me a yes or no answer to that.
    Ms. Jones. I think the NRC and OSHA said on the first panel 
that it would not be feasible to do in a year. That is one of 
the reasons that we said in our testimony that we felt a phase-
in was more appropriate, so that there would be more experience 
on some of the issues that NRC and OSHA were not familiar with.
    Mr. Shank. As I have mentioned, I believe it is not 
feasible to do it without a phase-in. There are many issues of 
who holds licenses, what the legacy issues, how those things 
are corrected. There is enormous complexity.
    We have had pilots at a simple facility like mine. I 
believe that more complex facilities will unravel even more 
difficulties, so the answer is no.
    Mr. Strickland. Thank you.
    Mr. Van Ness. I would agree that it is not feasible and as 
I said before I think there have been changes that one should 
take account of with regard to whether you do this at all.
    Mr. Strickland. Thank you.
    Ms. Eldredge. I think we should give them more time in 
terms of phasing in and perhaps a two-step program with OSHA 
being able to move a little faster than the NRC parts of it.
    However, I do think whatever legislation gets passed needs 
to have a date certain for that transfer, because if it is just 
a multistep process with pilot projects we might not ever get 
there, so we need to make sure that there is a date certain and 
then give them a step-wise way to get there.
    Mr. Adelman. We would also support a phased-in approach. 
The approach that is part of the DOE working group that phases 
it in with facilities that are most similar to the types of 
facilities that NRC is already regulating certainly makes sense 
and we would support that.
    In terms of a specific dateline I think that so long as the 
process is open and the public is involved in the transfer of 
authority from DOE to NRC and that there is a strict set of 
deadlines built into the legislation, that is certainly 
something we would support.
    Mr. Miller. I apologize, Mr. Strickland. I was just at the 
hearing you were at a little while ago. I apologize to Mr. 
Barton for being late.
    I would just offer you this, that at the Portsmouth Gaseous 
Diffusion Plant in Paducah which both had takeover OSHA 
authority effective July 1, 1993, basically there was just a 
pre-assessment that was done by Martin Marietta at that time 
that identified the noncompliance events and we went to work on 
OSHA regulation immediately, so I don't see any need for any 
delay.
    Ostensibly the Department of Energy is already supposed to 
be having its contractors comply with OSHA and since an order 
was issued in 1983 they have already had to be OSHA-compliant, 
so what is the difficult leap of turning on the switch in this 
Congress to commencing immediately OSHA regulation of DOE 
facilities?
    There is no justification for a phase-in approach because 
they are already supposed to be there.
    Now there may be some catch-up costs involved and I do not 
think anybody should think this is a cost-free transaction, and 
at Portsmouth and Paducah we saw roughly a $30 million shall we 
say retrofit to come into compliance with the orders DOE had 
already had in place but there is no need for phase-in on OSHA. 
That can start September 30 of this year if we pass legislation 
and OSHA had the money so that they were not stuck with an 
unfunded mandate, and so from our perspective the phase-in has 
to deal with the NRC and the certification and licensing, not 
OSHA.
    I see no reason for any delay in moving forward on OSHA 
regulation.
    Mr. Strickland. Thank you, sir.
    Mr. Stearns [presiding]. I thank the gentleman.
    Anyone on this side of the aisle who would like to ask 
questions?
    [No response.]
    Mr. Stearns. Okay. Mr. Miller, we previously had by 
unanimous consent made your opening statement part of the 
record and the only question I was going to ask is just your 
phasing in of external regulations dealing with what you just 
talked about, with OSHA since they are already in place, so I 
think you answered that adequately.
    I don't think without any further questions from members I 
think--we appreciate the panels' patience with us going back 
and forth to vote, and Chairman Barton is on the floor right 
now in debate so he could not be here, but again we appreciate 
your testimony.
    The committee is adjourned.
    [Whereupon, at 1:25 p.m., the subcommittee was adjourned.]
    [Additional material submitted for the record follows:]
Prepared Statement of Richard Miller, Paper Allied-Industrial, Chemical 
                         & Energy Workers Union
    I am Richard Miller, a Policy Analyst for the Paper, Allied-
Industrial, Chemical & Energy Workers Union (``PACE''), which, amongst 
its membership of 320,000 at oil, paper, chemical, pharmaceutical and 
cement factories, includes 6,500 hourly workers at 11 Energy Department 
(``DOE'') nuclear facilities, including Portsmouth, Paducah, Oak Ridge 
K-25, Mound, Hanford, INEEL, WIPP, Brookhaven, Grand Junction, Argonne-
East and Argonne-West.
    PACE, through it predecessor OCAW, was a member of the Advisory 
Committee on External Regulation and the NAPA Forum on OSHA-DOE 
Transition Issues. Outlined below are the key points in our testimony:

 DOE is the only federal agency whose facilities are exempt 
        from regulation by the NRC for nuclear safety and by OSHA for 
        worker protection. DOE has been justifiably criticized for lax 
        enforcement of its regulations, and today lacks a robust 
        program of self regulation. A prompt and orderly transition to 
        OSHA regulation is feasible and can be accomplished this year.
     The experience at Portsmouth and Paducah offers a key 
            lesson: enforceable rules will require DOE to spend money 
            on transition ``catch up'' costs.
 PACE supports external regulation, provided certain 
        protections are put in place so that workers would not be worse 
        off than they are today. These include:
     requiring NRC (or the DNFSB with enforcement authority) to 
            adopt OSHA's worker participation processes so that worker 
            concerns can be better addressed;
     retaining DOE's corporate health and safety oversight 
            functions, so regulators don't end up as de facto safety 
            managers;
     requiring full time ``site residents'' for both OSHA and 
            NRC inspectors at major DOE facilities and circuit riders 
            at smaller sites;
 Eliminate the non profit exemption for fines and penalties 
        under the Price Anderson Act;
 Clarify existing state legal authority over National Nuclear 
        Security Agency (NNSA) facilities to assure full enforceability 
        of environmental laws and compliance agreements.
1. DOE's Internal Oversight is Inadequate and There is no Prospect for 
        Reform
    Although DOE has a highly professional and competent health and 
safety staff in its Office of Environment Safety and Health (EH), 
decisions made at the top levels of the DOE have allowed its modest 
system of self-regulation to wither to the point of near invisibility. 
Three successive Energy Secretaries have eliminated the ``independent'' 
health and safety site representatives program. EH is noteworthy for 
its attention to after-the-fact investigations of fatalities, major 
near misses, and media attention to evident health and safety breaches. 
With the exception of recent work at Paducah and the other gaseous 
diffusion plants, DOE's system of self-regulation is more myth than 
reality.
    After 12 years of trying, DOE's EH Office of Enforcement has only 
managed to adopt 2 of 11 nuclear safety regulations required under the 
Price Anderson Act Amendments of 1988 (``PAAA''). This poor performance 
is not due to a lack of trying by EH, nor due to a lack of 
Congressional oversight by this Committee. Rather it reflects a 
perverse system wherein the internal regulators at EH have to obtain 
the permission of the various line programs (Energy Research, Defense, 
Science, Nuclear Energy, and Environmental Management) and headquarters 
elements (General Counsel, Field Management) to carry out Congressional 
directives to regulate health and safety. DOE's practice of obtaining 
consensus from all Department elements on the content of rules further 
assures lowest common denominator decisions--or no decision at all. 
Finally, the revolving door between senior DOE managers and contractors 
has further undercut efforts to build a robust internal accountability 
system.
    DOE's PAAA Enforcement Program--although limited by a staff of 6 
inspectors to cover the entire DOE complex--demonstrates how safety is 
enhanced when a program is given even a few teeth. Recently, the 
prospect of Price Anderson enforcement action motivated one DOE 
contractor to stop radiation related work until continuous airborne 
radiation monitors were properly functioning. Absent an accountability 
device that would translate to the contractor's bottom line, worker 
protections would have been postponed until it was convenient. The PAAA 
staff size is not due to resource shortages or lack of FTEs. Rather its 
size reflects the length of the political leash it has been given by 
the DOE leadership, and the degree to which it's enforcement actions 
will be tolerated without contractors generating a major political 
backlash.
    Most DOE field offices avoid oversight and rely upon contract 
provisions to drive accountability. This sounds appealing on its 
surface, however, DOE's understandable desire to get work done more 
quickly and at lower cost has resulted in competing priorities 
(productivity vs safety) which tends to make workers the victim. 
Reductions in award fees alone have not proven to be a powerful enough 
motivator to assure contractor compliance with nuclear safety rules, 
largely because there is no practical way to measure every action a 
contractor takes--or doesn't take--and translate it into a fee 
calculation.
    DOE has placed its management and integrating contractors in the 
position of overseeing their fixed price subcontractors' health and 
safety programs at the same time they are driving them for ever greater 
costs savings. Where economic incentives are in potential conflict, the 
absence of an independent third party ensures that accountability 
suffers. DOE's panacea for safety woes--Integrated Safety Management--
is simply a process to plan work up front. It is a complement to 
external regulation--not a substitute.
    Lastly, the DNFSB has been largely absent from of Environmental 
Management sites except where criticality concerns prevail. Their role 
has been constrained and could be considerably expanded.
2. A Pathway to External Regulation
    Numerous advisory panels have recommended that DOE should no longer 
self-regulate worker and nuclear facility safety. The only question is 
how to get it done.
    Step one: immediately legislate OSHA regulation of all DOE and NNSA 
sites. This would not be a burdensome transition, because DOE has 
ostensibly required its contractors to be OSHA compliant under the 
terms of its contracts and Orders since 1983. As such, DOE would not be 
subjected to any new rules. OSHA would need to update some of its rules 
to cover occupational radiation protection, and perhaps firearms and 
explosives safety. Although DOE-OSHA pilots at Oak Ridge, Berkeley, 
Argonne East demonstrated that there were no major obstacles to 
shifting to OSHA regulation, all of the parties were also on their best 
behavior perhaps making it seem easier than it will be in reality.
    Step two: require DOE and NRC (or DNFSB with enforcement capacity) 
to establish a plan, schedule and budget to assume control over nuclear 
activities (except nuclear explosives) at DOE facilities. Hazel O'Leary 
proposed NRC authority over new facilities and case-by-case decision 
making over which existing facilities would be covered. Congress needs 
to establish a schedule for decision making to assure a case-by-case 
approach would not result in interminable delays.
    Key considerations before moving forward include:

 Dedicating a percentage of DOE's budget for OSHA staff and 
        program costs, so that DOE regulation doesn't become an 
        unfunded mandate on a small agency that is already underfunded.
 Having OSHA provide some transitional relief on facility 
        upgrades and abatement actions
 Authorizing DOE to sign up for multi year abatement actions 
        with OSHA or NRC
 Where there are mixed (radiation/non radiation) hazards and 
        one regulator declines to take enforcement action, provide 
        authority for the other regulator to assert its authority.
 In agreement states, federal OSHA presence is located many 
        miles away and can only respond after the fact to accidents. 
        For than reason, we recommend full time OSHA site residents at 
        major DOE facilities (Hanford, INEEL, Oak Ridge, etc)
3. Several Lessons Learned from the External Regulation of the Gaseous 
        Diffusion Plants
    The 1992 Energy Policy Act mandated OSHA and NRC regulation of the 
DOE's uranium enrichment plants that were leased to the United States 
Enrichment Corporation (``USEC'') in Portsmouth, Ohio and Paducah, 
Kentucky. The USEC operations are basically chemical plants that 
process a very corrosive chemical with radiological properties: uranium 
hexaflouride.
    Prior to the commencement of OSHA regulation on July 1, 1993, 
USEC's M&O contractor, Martin Marietta, performed a self assessment of 
OSHA non compliance items, totaling approximately 12,000 items at 
Portsmouth and 4,000 items at Paducah. Repairs entailed installation of 
machine guards, providing fall protection by installing guard rails on 
working surfaces, updating electrical circuits, upgrading heat stress 
protections and providing mobile breathing air units 1. 
Estimated cost for the upgrades was $40 million. These expenditures 
would, if funded, have been required under Admiral Watkin's order that 
all DOE facilities come into full compliance with all OSHA 
requirements.
---------------------------------------------------------------------------
    \1\ UE OSHA Spending Plan, Martin Marietta Utility Services, May 
1994, UEO-1030
---------------------------------------------------------------------------
    A major dispute arose at Paducah over OSHA's enforcement authority 
for mixed radiation/chemical hazards. The dispute arose out of OSHA 
citations for uranium hexaflouride gas releases in 1993 related to 
violations of OSHA regulations governing emergency response, training 
and alarms. USEC and Martin Marietta maintained that OSHA had no 
jurisdiction over mixed chemical/radiation hazards. Rather, they argued 
that this responsibility rested with exclusively with DOE (and NRC once 
it took over) because the chemical release had radiological properties, 
and claimed that for OSHA to assert such jurisdiction amounted to dual 
regulation. The matter was ultimately settled, but the issue by no 
means disappeared.
    The 1996 USEC Privatization Act required OSHA and NRC to enter into 
a Memorandum of Agreement delineating their respective jurisdictions. 
The MOA was modeled after the one OSHA and NRC executed for boiling 
water reactors. That MOA gave NRC responsibility for anything related 
to radiation, and left OSHA with jurisdiction over industrial and 
construction types of hazards. Regrettably, our concerns that OSHA 
retain some jurisdiction over mixed hazards were not heeded, and NRC 
assumed full responsibility for mixed hazards.
    The OSHA-NRC jurisdiction question resurfaced in 1998 at the 
Portsmouth, Ohio plant when NRC failed to act on worker concerns that 
radiation dose records were not being properly counted and our local 
union turned to OSHA for assistance. As it turned out, management was 
administratively ``assigning'' radiation doses in hundreds of cases by 
pinning a dose badge on the wall, scanning it, and then arbitrarily 
assigning that dose to workers. OSHA issued a citation, but USEC 
maintained in settlement discussion that OSHA was exceeding its 
jurisdiction by goings into NRC's turf.
    While the enforcement matter was ultimately settled (USEC agreed to 
reconstruct doses for a 3 year period), a major policy question needs 
to be resolved in any external regulation regimen: (a) will there be a 
primary regulator where there are mixed hazards, and (b) what happens 
if the primary regulator fails to enforce and the other regulator 
determines that there is a mixed hazard violation and issues a penalty? 
In our view, if one regulator fails to act, then the other regulator 
should have the discretion to exercise their authority (provided it is 
not inconsistent with the first regulator's license conditions). This 
question should be resolved in any legislation directing that OSHA and 
NRC enter into a new Memorandum of Agreement. What works for allocating 
responsibilities at boiling water reactors, may not work at DOE sites.
    Adapting to NRC regulation has been a longer and more expensive 
process than OSHA transition. First, NRC had to certify the existing 
operations. NRC compliance costs were estimated to exceed $100 million 
at Paducah alone. Certification required a 2,300 page application, 
which was rejected by NRC the first time. The net result of this 
regulatory effort, however, was a more rigorous and arguably safer 
basis for operations. NRC also required the Paducah plant to make an 
estimated $21 million in seismic upgrades because of its location on a 
seismic fault. To its credit, NRC has accommodated USEC's seismic 
upgrade schedule by granting waivers because of unforseen obstacles.
4. NRC Needs to Implement the OSHA Procedures Related to Worker 
        Involvement in Inspections and Enforcement Actions
    NRC has not been ``worker friendly'' in its approach to oversight 
and regulation. NRC made it clear from day one at Paducah that their 
job is to interact with management and they are not in the business of 
taking concerns from workers and resolving them. NRC excludes workers 
from any role in walk around inspections, outbriefings, or enforcement 
actions.
    When NRC started examining issues at Paducah this summer, they 
never consulted with the local union health and safety reps on issues 
that required scrutiny, nor did they include them in the investigation. 
Ironically, DOE's EH Oversight Team included the designated safety 
representative to be in the morning outbriefs, solicited comments on 
draft reports, and sought cooperation in identifying issues of concern.
    While NRC has procedures to encourage stakeholder input at the 
national level, this is more related to public safety than worker 
safety.
    The NRC's approach stands in contrast with OSHA which targets its 
resources to resolving legitimate worker safety and health concerns. 
OSHA solicits worker input during inspections, by including worker 
representatives in the entry briefing, walkaround inspections, and the 
exit briefing. Workers can participate in OSHA enforcement proceedings, 
and they are provided as a matter of course with copies of findings 
and, if issued, copies of citations.
    NRC would be viewed more favorably as a worker safety regulator if 
it followed the OSHA procedures. As such, we recommend that legislation 
require NRC to follow the OSHA procedures outlined at 29 CFR Part 1903 
when regulating at DOE facilities.
5. Non Profit Fines and Penalties
    We support HR 3383. There is no reason that non-profit contractors 
who are receiving a fee should not be subjected to fines and penalties 
for nuclear safety violations under the Price Anderson Act Amendments. 
These same institutions are subject to fines and penalties from other 
environmental regulatory agencies, and if NRC were regulating these 
institutions, they would be similarly subject to fines and penalties. 
Indeed, when the OSHA-DOE pilots were underway at two non profit 
contractors, there was no discussion that this would take place on the 
condition that these non profits would be exempted from OSHA or NRC 
fines and penalties.
6. Assure that States Retain Authority at NNSA to Enforce Environmental 
        Laws
    The National Association of Attorneys General recently sought 
legislative clarification regarding states' authority to regulate and 
enforce against NNSA facilities. We support their request for 
legislative relief to preclude NNSA facilities from asserting sovereign 
immunity.
    We would be pleased to answer any questions you may have.
