[Federal Register Volume 61, Number 184 (Friday, September 20, 1996)]
[Notices]
[Pages 49496-49497]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-24133]


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NUCLEAR REGULATORY COMMISSION
[EA 96-302]


GRD Steel Corporation (GRD); Order Suspending License 
(Immediately Effective) and Requiring Transfer of Licensed Material

I

    GRD Steel Corporation, (Licensee) is the holder of NRC License No. 
37-30147-01 issued by the Nuclear Regulatory Commission (NRC or 
Commission) on February 6, 1995 pursuant to 10 CFR Part 30. License No. 
37-30147-01 authorizes the possession and use of up to 10 millicuries 
of cobalt-60 in sealed sources (with a maximum activity per source of 
3.3 millicuries). The license is due to expire on February 28, 2005. 
GRD was engaged in the manufacturing of carbon steel.

II

    On December 22, 1995, the NRC issued a Notice of Violation to GRD 
for two violations of NRC requirements. GRD responded to the Notice of 
Violation on December 29, 1995. Since the NRC had questions concerning 
the adequacy of the GRD response regarding locking of the sources, the 
NRC Region I staff contacted GRD's Radiation Safety Officer (RSO) (Mr. 
Mauro Coruzzi) on March 28, 1996, by telephone. The RSO indicated that 
GRD's operations had ceased and he was no longer working for GRD; the 
employment of all GRD employees was either terminated or transferred to 
another steel company (Commercial Steel Corporation (Commercial 
Steel)); and the owner of the building that housed the GRD operation 
was the Monongahela Industrial Development Association (MIDA) which now 
held title to GRD's Mid Mound Center facility and to both gauges as a 
result of its purchase at a sheriff's foreclosure sale of the property 
of GRD, and which was controlling access to the building via the 
posting of guards. MIDA is not licensed by the NRC to possess 
radioactive material.
    On April 10, 1996, Region I contacted Mr. Coruzzi by telephone 
because GRD had not made a formal declaration of bankruptcy or 
requested the NRC to assent to a change of ownership. The RSO indicated 
that GRD was not in bankruptcy nor had there been a change of 
ownership. However, he did indicate that MIDA had taken control of the 
facility because of GRD's apparent abandonment of the facility. He also 
indicated that the two gauges located at the facility, each containing 
approximately 3.3 millicuries of cobalt-60, were locked and not in use, 
nor could the gauges be accessed by unauthorized personnel because he 
was the only person in possession of the key used to unlock the gauges.
    During the April 10, 1996 conversation, Region I requested that GRD 
promptly document the information received verbally from the RSO. Since 
such documentation was not promptly received by the NRC, the NRC sent 
GRD a letter, dated April 23, 1996, advising the company to notify the 
NRC if it decided to change ownership, terminate licensed activities, 
or declare bankruptcy. GRD did not reply to that letter. As a result, 
on June 18, 1996, Mr. Coruzzi was again contacted by telephone by NRC, 
Region I. At that time, Mr. Coruzzi informed the NRC that the GRD 
President, Mr. Pradip K. Ghosh, was working for Commercial Steel, 
Glassport, Pennsylvania.
    Shortly thereafter, on June 19, 1996, NRC Region I telephoned Mr. 
Ghosh, because of NRC concerns that (1) the gauges were in the 
possession of MIDA, and that GRD had transferred material to MIDA, an 
unlicensed entity, in violation of the requirements of 10 CFR 30.3 and 
10 CFR 30.41, and (2) there might have been a transfer of control of 
the license without first obtaining the Commission's consent in writing 
as required by 10 CFR 30.34(b). During that conversation, Mr. Ghosh 
made a number of commitments to the NRC, including the commitment to 
contact APGEE/Berthold, the manufacturer of the gauges, by July 15, 
1996, to arrange for return of the gauges to the manufacturer. Mr. 
Ghosh also committed to provide a completed Certificate of Disposition 
(NRC Form 314) to the NRC, and request that its license be terminated, 
by July 31, 1996. The NRC issued a Confirmatory Action Letter (CAL) to 
confirm these commitments on June 20, 1996. A copy of this CAL was also 
sent to MIDA.
    On June 24, 1996, GRD sent the NRC Region I office a facsimile 
which stated that it was not correct to state that GRD had sold the 
property to MIDA and therefore it was not correct to conclude that GRD 
had transferred the license. GRD also stated that it did not want to 
terminate the license, and that it was working to gain additional 
financial backing in order to restart the operation, and requested that 
the gauges be kept in place to facilitate restarting the operation.
    On June 26, 1996, Supplement 1 to the CAL was issued to GRD and a 
copy was sent to MIDA. The CAL replaced the statement that GRD would 
request termination of its license by July 31, 1996, with the statement 
that GRD would maintain its license until a final determination was 
made with regard to the future of the company.
    On August 6, 1996, NRC Region I learned that the facility had been 
broken into approximately two to three weeks earlier. Subsequently on 
August 6, 1996, NRC Region I telephoned Ms. Lue Ann Pawlick, the 
General Manager of MIDA, about the apparent break-in at the facility. 
The General Manager described the materials taken from the facility, 
and indicated that the gauges were not affected by the break-in, all 
materials had been recovered, the perpetrators had been apprehended, 
and additional local police patrols and daily walk-throughs by a local 
president of the steel workers union were being performed.
    On August 6, 1996, NRC Region I attempted to contact the President 
of GRD. At that time, the NRC learned that the President would be out 
of the country until early September and could not be reached.
    On August 12, 1996, the NRC issued a Confirmatory Order to MIDA to 
assure that MIDA maintains control of the NRC-licensed gauges and that 
the gauges will remain locked at all times; that MIDA request 
additional patrols from the local police in the area, until such time 
as the gauges are transferred to an authorized recipient; that MIDA 
perform daily walk-throughs of the plant to ensure that the gauges had 
not been tampered with; that MIDA either obtain a license from the NRC 
to possess the material or to transfer the material to a specific NRC 
or Agreement State licensee authorized to possess such material, and, 
in the absence of obtaining a license from the NRC to possess the 
gauges, transfer the gauges within 90 days from the date of this Order, 
either back to the manufacturer, or to another authorized recipient; 
and that MIDA inform the NRC by August 19, 1996 under oath or 
affirmation regarding the specific actions MIDA will take to comply 
with these conditions.
    The NRC has also received information from the Pennsylvania 
Corporation Bureau that indicated that there was some similarity in 
corporate officers of GRD Steel and Commercial Steel. The NRC has 
determined that the President and Radiation Safety Officer (RSO) of GRD 
Steel are currently employed by Commercial Steel, and that telephone 
calls to GRD are answered by

[[Page 49497]]

Commercial Steel, and that the address of both companies is the same.

III

    Based on the above, it appears that GRD Steel, its employees, 
including the President and the Radiation Safety Officer, have 
willfully permitted the licensed gauges to be transferred to MIDA, an 
entity known by GRD not to have an NRC license to possess radioactive 
material. GRD Steel, as the licensee, remains responsible for assuring 
that the licensed material is possessed and controlled by a licensee of 
the Commission or an Agreement State and, therefore, is jointly and 
severally responsible with MIDA for the proper transfer of that 
licensed material now possessed by MIDA. Further, the actions of GRD 
Steel, including the failure to reply to NRC inquiries and to reply 
completely to the Notice of Violation issued in December 1995 in a 
timely manner, indicate that GRD Steel is not able to conduct its 
program in accordance with all NRC requirements.
    Consequently, I lack the requisite reasonable assurance that the 
Licensee's activities can be conducted under License No. 37-30147-01 in 
compliance with the Commission's requirements and that the health and 
safety of the public, including the Licensee's employees, will be 
protected. Therefore, public health, safety, and interest require that 
License No. 37-30147-01 be suspended. Furthermore, pursuant to 10 CFR 
2.202, I find that the significance of the violation described above is 
such that public health, safety, and interest require that this Order 
be immediately effective.

IV

    Accordingly, pursuant to sections 81, 161b, 161i, 161o, 182 and 186 
of the Atomic Energy Act of 1954, as amended, and the Commission's 
regulations in 10 CFR 2.202 and 10 CFR Part 30, it is hereby ordered, 
effective immediately, that:
    A. GRD's authority under License No. 37-30147-01 to receive, 
possess, and use radioactive material is suspended. GRD may only 
possess material for the purpose of transferring it to an authorized 
recipient under condition B below;
    B. GRD will transfer, in cooperation with MIDA, all NRC-regulated 
material to an authorized recipient within 60 days of receipt of this 
Order. If GRD believes it does not have sufficient funds to complete 
the transfer, it must provide, within 30 days of this Order, evidence 
supporting such a claim by submitting to the Director, Office of 
Enforcement, U.S. Nuclear Regulatory Commission, Washington, D.C. 
20555, in writing under an oath or affirmation:
    (1) An estimate of the cost of the transfer and the basis for the 
estimate, including the license number and identity of the entity that 
would perform the transfer;
    (2) Written statements from at least two banks stating that GRD 
could not qualify for a loan to pay for the transfer;
    (3) Copies of the Federal income tax return for the years ending 
1994 and 1995 for GRD Steel Corporation and its officers;
    (4) Copies of profit and loss statements from GRD Steel Corporation 
for these same years;
    C. GRD shall notify NRC Region I at least two working days prior to 
the date of the transfer so that NRC may, if it elects, observe the 
transfer of this material to an authorized recipient;
    D. GRD, within seven days following the completion of the transfer, 
shall provide to the Regional Administrator, Region I:
    (1) Confirmation in writing (NRC Form 314) that the radioactive 
material has been transferred; and
    (2) A copy of the certification from the authorized recipient that 
the material has been received.
    E. The provisions of Section IV of this Order do not relieve MIDA 
of any requirement imposed by the Confirmatory Order dated August 12, 
1996, identified in Section II of this Order.
    The Regional Administrator, Region I, may relax or rescind, in 
writing, any of the above conditions upon a showing by GRD of good 
cause.

V

    In accordance with 10 CFR 2.202, the Licensee must, and any other 
person adversely affected by this Order may, submit an answer to this 
Order, and may request a hearing within 20 days of the date of this 
Order. Where good cause is shown, consideration will be given to 
extending the time to request a hearing. A request for extension of 
time must be made in writing to the Director, Office of Enforcement, 
U.S. Nuclear Regulatory Commission, Washington, D.C. 20555, and include 
a statement of good cause for the extension. The answer may consent to 
this Order. Unless the answer consents to this Order, the answer shall, 
in writing and under oath or affirmation, specifically admit or deny 
each allegation or charge made in this order and set for the matters of 
fact and law on which the Licensee or other person adversely affected 
relies and the reasons as to why the Order should not have been issued. 
Any answer or request for a hearing shall be submitted to the 
Secretary, U.S. Nuclear Regulatory Commission, ATTN: Chief, Docketing 
and Service Section, Washington, D.C. 20555. Copies also shall be sent 
to the Director, Office of Enforcement, U.S. Nuclear Regulatory 
Commission, Washington, D.C. 20555, to the Assistant General Counsel 
for Hearings and Enforcement at the same address, to the Regional 
Administrator, NRC Region I, 475 Allendale Road, King of Prussia, 
Pennsylvania, 19406-1415, and to the Licensee. If such a person 
requests a hearing, that person shall set forth with particularity the 
manner in which his interest is adversely affected by this Order and 
shall address the criteria set forth in 10 CFR 2.714(d).
    If a hearing is requested by the Licensee or a person whose 
interest is adversely affected, the Commission will issue an Order 
designating the time and place of any hearing. If a hearing is held, 
the issue to be considered at such hearing shall be whether this Order 
should be sustained.
    Pursuant to 10 CFR 2.202(c)(2)(i), the Licensee, or any other 
person adversely affected by this Order, may, in addition to demanding 
a hearing, at the time the answer is filed or sooner, move the 
presiding officer to set aside the immediate effectiveness of the Order 
on the ground that the Order, including the need for immediate 
effectiveness, is not based on adequate evidence but on mere suspicion, 
unfounded allegations, or error.
    In the absence of any request for hearing, or written approval of 
an extension of time in which to request a hearing, the provisions 
specified in Section IV above shall be final 20 days from the date of 
this Order without further order or proceedings. If an extension of 
time for requesting a hearing has been approved, the provisions 
specified in Section IV shall be final when the extension expires if a 
hearing request has not been received. An answer or a request for 
hearing shall not stay the immediate effectiveness of this order.

    Dated at Rockville, Maryland this 13th day of September 1996.

    For the Nuclear Regulatory Commission.
Hugh L. Thompson, Jr.,
Deputy Executive Director for Nuclear Materials Safety, Safeguards, and 
Operations Support.
[FR Doc. 96-24133 Filed 9-19-96; 8:45 am]
BILLING CODE 7590-01-P