EA-96-093 - Gamma Tech Industries, Inc.
EA 96-093
Mr. Jim Ham, President
Gamma Tech Industries, Inc.
3645 Dalbergia Street
San Diego, California 92113-3912
SUBJECT: NOTICE OF VIOLATION & PROPOSED IMPOSITION OF CIVIL
PENALTY - $1,500 (NRC INSPECTION REPORT 999-90004/95-09;
INVESTIGATION REPORT 4-95-042)
Dear Mr. Ham:
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 apparent violations of NRC requirements identified during an NRC inspection and investigation of Gamma Tech Industries, Inc.'s (Gamma Tech) activities in NRC jurisdiction. The apparent violations, which were summarized in a March 28, 1996, letter to you, included: 1) conducting radiography in exclusive federal jurisdiction without an NRC license<1>; 2) deliberately causing the above violation; and 3) providing inaccurate information to the NRC during a telephone interview.
With respect to the first two apparent violations, you admitted during the investigation and at the conference that Gamma Tech 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 reasons for this violation were that Gamma Tech was struggling financially; that other companies also appeared to be in noncompliance in the past; and that the NRC had not (until late 1995) made an issue of this requirement not being met by radiographers in the San Diego area.
With respect to the third apparent violation, you acknowledged that you may have provided inaccurate information to an NRC inspector in response to a question about when Gamma Tech had last conducted radiography on U.S. Navy ships, but explained that you provided this response without first checking your records and that you did not intend to mislead the NRC. Furthermore, you indicated that you made records of this work available to the NRC during the investigation.
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 Gamma Tech's intentional failure to obtain an NRC license before using byproduct material to perform industrial radiography in an area of exclusive federal jurisdiction. As an alternative to obtaining an NRC license, Gamma Tech had the option, as permitted by NRC practice, to file an NRC Form 241, "Report of Proposed Activities in Non-Agreement States," and pay the required fees<2> prior to conducting those licensed activities.
Gamma Tech stated during the conference that it places a premium on conducting its activities safely and in accordance with all safety requirements. The NRC's inspection of Gamma Tech's records and interviews of Gamma Tech personnel did not find any evidence of significant safety violations. Nonetheless, the failure to obtain NRC authorization is a matter of significant regulatory concern because it denies the NRC the opportunity to assure through 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.
Gamma Tech stated at the conference that it discontinued attempts to file a Form 241 with the NRC and discontinued conducting radiography in NRC jurisdiction after August 1995. These actions were apparently taken because of the belief that an NRC inspector had told Gamma Tech's chief inspector, Mr. Mahaffey, not to bother filing because of the ongoing NRC investigation. Even though the inspector's recollection differs from Gamma Tech's regarding this discussion, the NRC accepts Gamma Tech's statement that it was intent on coming into compliance in late 1995 and has since taken additional steps to familiarize itself with NRC requirements.<3> Gamma Tech also was assured following the conference that there were no restrictions on its applying for an NRC license or, as permitted by NRC practice, filing a Form 241 in order to conduct radiography in NRC jurisdiction.
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 Gamma Tech is a small business, the absence of significant safety violations, and the fact that Gamma Tech's willful violation after it was placed on notice by the NRC resulted in a savings of fees to Gamma Tech on the order of the amount of the civil penalty that is proposed herein.
Notwithstanding Gamma Tech'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.
The NRC has decided not to take any individual enforcement action based on deliberate misconduct. You are now on notice that deliberate violations may subject individuals to civil and criminal sanctions pursuant to 10 CFR 30.10. In addition, the NRC has decided not to issue a violation based on inaccurate information being given to an NRC inspector. With regard to the latter, the NRC has taken into account that this information was provided during a telephone interview and was provided without first checking Gamma Tech's records. The NRC notes, however, that its expectation is that a licensee inform the NRC if it is not sure of an answer and if any information in a communication was in error.
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. 999-90004
License No. CA 5364-80
Enclosures:
1. Notice of Violation and Proposed Imposition of Civil Penalty
cc w/Enclosures: During an NRC inspection and investigation conducted August 15, 1995,
through February 28, 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: This is a Severity Level III violation (Supplement VI). Pursuant to the provisions of 10 CFR 2.201, Gamma Tech Industries, 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,
California Radiation Control Program
Jim Ham, 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
Gamma Tech Industries, Inc. Docket No. 999-90004
San Diego, California License No. CA 5364-80
EA 96-093
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 1992, 1993, 1994 and 1995, Gamma Tech Industries, 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)
Civil Penalty - $1,500
this 6th day of June 1996
