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taken place within the Commission, change simply has not happened, and the activities have continued.

After 13 years of watching this, I have grown tired of it. I think it is time that this committee seriously consider legislative changes within the NRC to build in the kind of accountability and independence that can convey a sense of security and trust to the American people. Industry must also get out from underneath the constant, constant cloud of suspicion and mistrust. This committee must now see whether we can in fact help the industry do what it is supposed to do: generate electricity for American consumers.

That service simply has not happened. In my own State of California we have been party to very prolonged battles over not only the construction but also the operation of these facilities. I think we have not served the public well to date.

So, Mr. Chairman, with you as the new chairman of the Oversight Subcommittee, knowing your vigorous style, I look forward to participating with you in a very complete and detailed set of hearings on the oversight of the NRC.

Thank you.

[Prepared statement of Mr. Miller follows:]

STATEMENT OF THE
HONORABLE GEORGE MILLER
before the

Subcommittee on Oversight and Investigations
June 11, 1986

Mr. Chairman. I would like to commend you for holding these oversight hearings on the Nuclear Regulatory Commission. The hearings are coming at a particularly important time.

Congress is presently considering a number of issues relating to both the nuclear industry and to the energy needs of this country.

Just recently, the House Interior Committee reported out legislation extending the Price-Anderson Act. I anticipate that reauthorization of this program will be the subject of heated debate on the House floor and that a number of issues we raised in committee will be revisited on the floor.

As we move ahead on this and other issues, the performance of the NRC and the safety of the industry are critical components of the debate.

As I read through the testimony for this hearing, as well as that presented in the recent hearings before the Senate Government Operations Committee, I found myself becoming increasingly disturbed about the NRC's commitment to and enforcement of the strongest possible safety standards for nuclear power plants.

Let me say at the outset that I am not anti-nuclear. But, like most people in this country, I worry about what a nuclear accident will mean. We got a hint of how terrible it could be with Three Mile Island and Chernobyl. We read report after report of problems at one nuclear plant or another. It is essential -- because of the potentially massive consequences of a nuclear incident -- that the strongest possible safety standards be applied to this industry.

Yet, as I read the testimony, I find that at least some power plants are plagued with drinking and drug abuse problems. I find the NRC does not have an enforceable rule covering the "fitness for duty" programs of utilities. All we have to do is recall the recent wreck of the Amtrak train between here and New York. It appears the engineer may have been under the influence of drugs. The loss of life in that wreck was tragic, but no where near what it will be if a nuclear plant gets out of control the way the train did.

I find the allegations that some of the management at the NRC participated in harassing employees — who by all appearances were trying to do their job of making sure that power plants are as safe as possible very disturbing. Such employees should be encouraged and rewarded, not intimidated, transferred, and threatened.

I found the allegations that the safety standards may not be as strong as they should be disturbing. I am concerned that the NRC has chosen to opt for unenforceable guidelines to cover drug and alcohol abuse at nuclear power plants -- apparently conceding to the wishes of industry. I am concerned that the NRC has chosen to interpret its fire regulations in a manner which appears to favor industry wishes, not public safety concerns.

The NRC has a critical — indeed an essential -- regulatory function. The NRC should be the watchdog and the policeman of the nuclear industry. Yet, what we have before us suggests that the agency may be too friendly with the industry it is supposed to be watching.

Mr. Chairman, I think this hearing is extremely important. I hope that our questions and concerns can be answered. I encourage you to continue to pursue your oversight of this agency -- its work is critically important to all of us. It may be, as we explore the issues the testimony raises in greater depth, some legislative remedies will be required. I will be more than willing to work with you, should this prove to be the case.

Mr. Gejdenson. Mr. Hansen, an opening statement? Mr. Hansen. No, I have no opening statement, Mr. Chairman. Thank you. Mr. Gejdenson. Mr. DeFazio. Mr. Defazio. Thank you, Mr. Chairman.

I, too, commend the chairman for holding these very important hearings and look forward to the result. I don't come in with my mind made up, but I have to say that I would like to hear a strong case presented by the Commission to refute the prejudice or whatever that I have obtained through the press and past study of the Commission, which is that they are more of an advocate for the industry than they are the public watchdog, enforcing the highest possible standards.

I think that leaning in the direction of advocacy is a grave error, and as Congressman Miller observed, that it has undermined faith in the industry because we are dealing with forces here that absolutely have to be safely contained, and can be, and have successfully been for the most part in the United States.

But I think when you step over the line and we question the safety because the agency charged with enforcing the highest possible standards actually, at times, has appeared to be more of an advocate than the watchdog, it undermines the public faith and confidence and it moves us in a direction that does not accomplish the purposes of safe generation of electricity.

So I look forward to the hearings and hope that I can be persuaded that indeed the agency is striving or has achieved that end.

Mr. Gejdenson. Thank you.

I had all the committee members write in the commendations of the chairman. I thank you for reading those. Commissioner Zech, if you would start.

PANEL FROM THE U.S. NUCLEAR REGULATORY COMMISSION CONSISTING OF HON. LANDO W. ZECH, JR., CHAIRMAN; COMMISSIONERS FREDERICK M. BERNTHAL, JAMES K. ASSELSTINE, KENNETH M. CARR, AND THOMAS M. ROBERTS

Mr. Zech. Thank you, Mr. Chairman.

Mr. Chairman, members of the subcommittee, my fellow Commissioners and I are pleased to appear before you today to discuss the effectiveness and performance of the Nuclear Regulatory Commission's Office of Inspector and Auditor, which I will refer to as OIA, and the Office of Investigations, OI.

With your permission, I would like to submit my full statement for the record and summarize its principal points.

Mr. Gejdenson. Without objection.

Mr. Zech. Thank you, sir.

The Office of Inspector and Auditor has existed at the NRC since the agency commenced operations in 1975. It has two primary responsibilities: (1) to audit NRC operations to ensure that agency activities are conducted effectively, efficiently and with integrity; and (2) to investigate alleged wrongdoing by NRC employees and contractors.

The OIA Director reports directly to the Commission. For the past 12 years, this office has competently performed these essential functions. OIA develops its own audit program after receiving recommendations from the Commission and the Executive Director for Operations, the EDO.

It has the authority to set its own priorities, conduct its audits and investigations, and prepare its recommendations for presentation to the Commission.

The Office of Investigations has entirely different responsibilities. This is 01. Its mission is to investigate wrongdoing by licensees or others in the regulated industry, to assist the Commission in making licensing enforcement decisions. Until about 5 years ago, the Commission had no special office charged with investigating such wrongdoing. For a variety of reasons, the Commission in 1982 created 01, staffed by trained investigators. If OI investigations also indicate the possibility of criminal misconduct, 01 makes appropriate referrals to the Department of Justice.

It must be emphasized, however, that the primary purpose of establishing 01 was to assist in staff determinations and Commission decisions, rather than to pursue criminal investigations. Like OIA, 01 is a Commission-level office. It develops investigatory strategy, obtains evidence through interviews with witnesses and review of documents, and drafts its reports and conclusions for presentation to the Commission or NRC office that requested the investigation.

Priorities of 01 investigations are now based on generic criteria tied to the potential safety significance of the alleged wrongdoing. The Office of Investigations must work closely with NRC technical staff. When technical expertise is needed, the EDO assigns the necessary individuals to help OI conduct its investigations.

If the technical staff becomes aware of information relevant to an ongoing 01 investigation, it is required to communicate that information to OI. In turn, 01 keeps NRC offices which request 01 investigations informed of significant developments in ongoing investigations.

Similarly, if either 01 or OIA obtains information that would be of assistance to the other office in carrying out ongoing investigations, it communicates the necessary information.

Your letter of invitation also solicited comment on the need for a statutory NRC Inspector General and for a statutorily-established independent Office of Investigations. Legislative proposals to establish an Inspector General within the NRC would have varying effects on the mission of OIA as it currently exists. The principal change, however, would be to make the OIA Director, or Inspector General as it would become, subject to appointment and removal by the President rather than the Commission.

This may appear to be a small change, but it is a change which merits some reflection before the Congress acts to extend for the first time what may be a perfectly sound concept within the confines of the executive branch to the somewhat different environment of a small independent regulatory commission like the NRC.

We have not one, but five, independent officials acting jointly to manage the agency and to act in the public interest. We ourselves are presidentially appointed and confirmed by the Senate. Our licensing processes operate in an open and highly-charged environment. Under the circumstances, it is difficult for us to see how providing the Commission with an Inspector General subject to presi

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