EA-96-065 - Industrial Marine Testing Labs, Inc.
Mr. Samuel Boykin, President
Industrial Marine Testing Labs, Inc.
3167 Commercial Street
San Diego, California 92113
SUBJECT: NOTICE OF VIOLATION & PROPOSED IMPOSITION OF CIVIL PENALTY - $1,500 (NRC INSPECTION REPORT 150-00004/95-10; INVESTIGATION REPORT 4-95-028)
Dear Mr. Boykin:
This is in reference to the predecisional enforcement conference conducted on April 25, 1996, in San Diego, California. Enclosure 1 is a list of conference attendees. The conference was conducted to discuss an apparent violation of NRC requirements identified during an NRC inspection and investigation of Industrial Marine Testing Labs, Inc. (Industrial Marine) activities in NRC jurisdiction. The apparent violation, which was summarized in a March 18, 1996, letter to you, involved knowingly conducting radiography in exclusive federal jurisdiction without an NRC license<1>.
You admitted during the investigation and at the conference that Industrial Marine had knowingly conducted radiography on U.S. Navy ships, an area which is under exclusive federal jurisdiction, without obtaining the necessary authorization from the NRC. You indicated at the conference that the primary reasons for this violation were that Industrial Marine was struggling financially; that other companies also appeared to be in noncompliance in the past; that the requirement had not come up even though you were working for an arm of the federal government; and that based on your own experience you didn't believe the NRC considered it an important matter.
Based on the information developed during the inspection and investigation and the information that you provided during the conference, the NRC has determined that a violation of NRC requirements occurred. The violation is cited in the enclosed Notice of Violation and Proposed Imposition of Civil Penalty (Notice) and involves Industrial Marine's intentional failure to obtain an NRC license before using byproduct material to perform radiography in an area of exclusive federal jurisdiction. As an alternative to obtaining an NRC license, you had the option, as permitted by NRC practice, of filing an NRC Form 241, "Report of Proposed Activities in Non-Agreement States," and paying the required fees<2>.
Industrial Marine stated during the conference that, despite financial problems, it places a premium on conducting its activities safely and in accordance with all safety requirements. The NRC's inspection of Industrial Marine's records and interviews of Industrial Marine personnel did not find any evidence of significant safety violations. Nonetheless, the failure to obtain NRC authorization is a matter of significant regulatory concern to the NRC because it denies the NRC the opportunity to assure through field inspections that radiography activities are being conducted in compliance with all NRC radiation safety requirements. In addition, deliberate violations of NRC requirements, even those that are administrative in nature, raise questions about attitudes toward compliance in general. Therefore, this violation has been classified in accordance with the "General Statement of Policy and Procedure for NRC Enforcement Actions (Enforcement Policy)," NUREG-1600, at Severity Level III.
The base civil penalty for a Severity Level III violation is $5,000. In accordance with the Enforcement Policy, the NRC normally considers only three factors -- previous enforcement history, identification of the violation and corrective action -- in determining whether a Severity Level III violation should result in a base penalty, two times a base penalty or no penalty. The NRC also may exercise discretion and assess either a larger or smaller penalty based on the circumstances involved, including whether the violation was committed willfully. The normal assessment process in this case would have resulted in at least the base penalty being assessed. However, the NRC has decided to exercise its discretion, in accordance with VII.B.6 of the Enforcement Policy, to assess a smaller civil penalty based on the circumstances of this case. The circumstances that the NRC took into account include the fact that Industrial Marine is a small business, the absence of significant safety violations, and that you were put on specific notice by the NRC on November 22, 1993 and you continued to conduct activities, and the fact that monies were saved by being in noncompliance. We also note that Industrial Marine filed an NRC Form 241 in late 1995 and paid the accompanying fee and did the same for calendar year 1996. Industrial Marine also stated at the conference that it has since taken additional steps to familiarize itself with NRC requirements.<3>
Notwithstanding Industrial Marine's corrective actions noted above, to emphasize the significance of making a deliberate decision to violate an NRC requirement and the importance of complying with all NRC requirements in the future, I have been authorized, after consultation with the Director, Office of Enforcement, and the Deputy Executive Director for Nuclear Materials Safety, Safeguards and Operations Support, to issue the enclosed Notice of Violation and Proposed Imposition of Civil Penalty in the amount of $1,500 for this Severity Level III violation.
As to your statement regarding your competitors doing work for the Navy without having an NRC license, as a result of the NRC's investigations of state licensees who worked for the Navy, the Navy is now assuring that such companies have NRC licenses before allowing work to be done.
You are required to respond to this letter and should follow the instructions specified in the enclosed Notice when preparing your response. In your response, you should document the specific actions taken and any additional actions you plan to prevent recurrence. You should also document steps you have taken or plan to take to assure that you are complying with all NRC requirements for any work conducted in areas of exclusive federal jurisdiction. After reviewing your response to this Notice, including your proposed corrective actions and the results of future inspections, the NRC will determine whether further NRC enforcement action is necessary to ensure compliance with NRC regulatory requirements.
In accordance with 10 CFR 2.790 of the NRC's "Rules of Practice," a copy of this letter, its enclosures, and your response will be placed in the NRC Public Document Room (PDR). To the extent possible, your response should not include any personal privacy, proprietary, or safeguards information so that it can be placed in the PDR without redaction.
Sincerely, org signed by L. J. Callan Regional Administrator
Docket No. 150-00004
License No. CA 2799-90
1. Predecisional Enforcement Conference Attendees
2. Notice of Violation and Proposed Imposition of Civil Penalty
California Radiation Control Program
San Diego, California
Industrial Marine Testing Labs, Inc.
Samuel Boykin, President and Radiation Safety Officer
Nuclear Regulatory Commission, Region IV
Linda Howell, Chief, Nuclear Materials Inspection & Fuel Cycle/Decommissioning Branch,
Division of Nuclear Materials Safety
Gary Sanborn, Enforcement Officer,
Office of the Regional Administrator
Industrial Marine Testing Labs, Inc. Docket No. 150-00004 San Diego, California License No. CA 2799-90 EA 96-065
During an NRC inspection and investigation conducted June 13, 1995, through February 15, 1996, a violation of NRC requirements was identified. In accordance with the "General Statement of Policy and Procedure for NRC Enforcement Actions," NUREG-1600, the Nuclear Regulatory Commission proposes to impose a civil penalty pursuant to Section 234 of the Atomic Energy Act of 1954, as amended (Act), 42 U.S.C. 2282, and 10 CFR 2.205. The particular violation and associated civil penalty are set forth below:
10 CFR 30.3 requires in relevant part, that no person shall possess or use byproduct material except as authorized by a specific or general license issued by the NRC unless exempt as provided in Part 30 or Part 150.
Contrary to the above, on multiple instances during calendar years 1993, 1994 and 1995, Industrial Marine Testing Labs, Inc., a licensee of the state of California, used byproduct material to perform industrial radiography on U.S. Navy ships, an area in exclusive federal jurisdiction, without either a specific or general license issued by the NRC. (01013)
This is a Severity Level III violation (Supplement VI).
Civil Penalty - $1,500
Pursuant to the provisions of 10 CFR 2.201, Industrial Marine Testing Labs, Inc., is hereby required to submit a written statement or explanation to the Director, Office of Enforcement, U.S. Nuclear Regulatory Commission, within 30 days of the date of this Notice of Violation and Proposed Imposition of Civil Penalty (Notice). This reply should be clearly marked as a "Reply to a Notice of Violation" and should include for each alleged violation: (1) admission or denial of the alleged violation, (2) the reasons for the violation if admitted, and if denied, the reasons why, (3) the corrective steps that have been taken and the results achieved, (4) the corrective steps that will be taken to avoid further violations, and (5) the date when full compliance will be achieved. If an adequate reply is not received within the time specified in this Notice, an order or a Demand for Information may be issued as why the license should not be modified, suspended, or revoked or why such other action as may be proper should not be taken. Consideration may be given to extending the response time for good cause shown. Under the authority of Section 182 of the Act, 42 U.S.C. 2232, this response shall be submitted under oath or affirmation.
Within the same time as provided for the response required above under 10 CFR 2.201, the Licensee may pay the civil penalty by letter addressed to the Director, Office of Enforcement, U.S. Nuclear Regulatory Commission, with a check, draft, money order, or electronic transfer payable to the Treasurer of the United States in the amount of the civil penalty proposed above, or may protest imposition of the civil penalty in whole or in part, by a written answer addressed to the Director, Office of Enforcement, U.S. Nuclear Regulatory Commission. Should the Licensee fail to answer within the time specified, an order imposing the civil penalty will be issued. Should the Licensee elect to file an answer in accordance with 10 CFR 2.205 protesting the civil penalty, in whole or in part, such answer should be clearly marked as an "Answer to a Notice of Violation" and may: (1) deny the violation listed in this Notice, in whole or in part, (2) demonstrate extenuating circumstances, (3) show error in this Notice, or (4) show other reasons why the penalty should not be imposed. In addition to protesting the civil penalty in whole or in part, such answer may request remission or mitigation of the penalty.
In requesting mitigation of the proposed penalty, the factors addressed in Section VI.B.2 of the Enforcement Policy should be addressed. Any written answer in accordance with 10 CFR 2.205 should be set forth separately from the statement or explanation in reply pursuant to 10 CFR 2.201, but may incorporate parts of the 10 CFR 2.201 reply by specific reference (e.g., citing page and paragraph numbers) to avoid repetition. The attention of the Licensee is directed to the other provisions of 10 CFR 2.205, regarding the procedure for imposing a civil penalty.
Upon failure to pay any civil penalty due which subsequently has been determined in accordance with the applicable provisions of 10 CFR 2.205, this matter may be referred to the Attorney General, and the penalty, unless compromised, remitted, or mitigated, may be collected by civil action pursuant to Section 234c of the Act, 42 U.S.C. 2282c.
The response noted above (Reply to Notice of Violation, letter with payment of civil penalty, and Answer to a Notice of Violation) should be addressed to: Mr. James Lieberman, Director, Office of Enforcement, U.S. Nuclear Regulatory Commission, One White Flint North, 11555 Rockville Pike, Rockville, MD 20852-2738, with a copy to the Regional Administrator, ATTN: Enforcement Officer, U.S. Nuclear Regulatory Commission, Region IV, 611 Ryan Plaza Drive, Suite 400, Arlington, Texas 76011.
Because your response will be placed in the NRC Public Document Room (PDR), to the extent possible, it should not include any personal privacy, proprietary, or safeguards information so that it can be placed in the PDR without redaction. However, if you find it necessary to include such information, you should clearly indicate the specific information that you desire not to be placed in the PDR, and provide the legal basis to support your request for withholding the information from the public.
Dated at Arlington, Texas,
this 6th day of June 1996