United States Nuclear Regulatory Commission - Protecting People and the Environment

EA-98-124 - The Terracon Companies, Inc.

May 15, 1998

EA 98-124

Mr. Larry K. Davidson
President and CEO
The Terracon Companies, Inc.
16000 College Boulevard
Lenexa, Kansas 66219

SUBJECT: NOTICE OF VIOLATION AND PROPOSED IMPOSITION OF CIVIL PENALTY -
$2,750 (NRC Inspection Report No. 030-32176/98-01)

Dear Mr. Davidson:

This is in response to your letter dated April 6, 1998, in which Mr. Gary Bradley of your staff submitted a "Response to an Apparent Violation" on behalf of The Terracon Companies, Inc. (Terracon). The NRC's inspection was completed on February 26, 1998. The apparent violation was described in the NRC's March 24, 1998 inspection report and involved a failure to maintain adequate control of a portable moisture/density gauge, resulting in its theft. The NRC's letter transmitting the inspection report indicated that the NRC was considering escalated enforcement action for this apparent violation. Terracon was given a choice of responding in writing or requesting a predecisional enforcement conference, and you chose to submit a written response.

In its April 6, 1998 response, Terracon stated that the gauge was stolen from a truck parked at a restaurant on January 23, 1998. Terracon stated that it was stolen from its shipping container because a Terracon technician did not secure a padlock which had been placed in the hasp of the gauge case. Terracon stated that the technician's negligence occurred despite recent retraining in gauge transport and security procedures.(1) Terracon also indicated that disciplinary action had been taken against the involved technician for his negligence, and an electronic memorandum regarding the theft and failed security measures was sent to all Terracon office managers/radiation safety officers. Finally, Terracon indicated that it will instruct local radiation safety officers to enhance periodic policing of gauge security efforts at temporary project sites.

Based on the information developed during the NRC's inspection, and our consideration of the information provided in Terracon's April 6 letter, the NRC has determined that a violation of NRC requirements occurred. This violation is cited in the enclosed Notice of Violation and Proposed Imposition of Civil Penalty. The violation involves the failure to maintain adequate control and surveillance of licensed material in accordance with the requirements of 10 CFR 20.1802.

Although the stolen gauge was recovered by the Tulsa Police Department and was intact, Terracon's failure to assure proper security of this gauge resulted in the theft of licensed radioactive material and the potential for its misuse and unnecessary radiation exposures to members of the public. Therefore, this violation has been classified at Severity Level III in accordance with the "General Statement of Policy and Procedure for NRC Enforcement Actions" (Enforcement Policy), NUREG-1600.

In accordance with the Enforcement Policy, a civil penalty with a base value of $2,750 is considered for a Severity Level III violation. Because Terracon has been the subject of escalated enforcement action within the last 2 years,(2) the NRC considered whether credit was warranted for Identification and Corrective Action in accordance with the civil penalty assessment process in Section VI.B.2 of the Enforcement Policy. The NRC has determined that credit for identification is not warranted because the violation was self-disclosing, i.e., it was apparent as a result of the theft of the gauge. The NRC has determined that credit for corrective action is warranted because your actions, which are described above, were prompt and sufficiently comprehensive to minimize the potential for a similar event. This results in the assessment of a penalty at the base value.

Therefore, to emphasize the importance of compliance with requirements that are designed to assure that licensed material remains in the control of licensees, the need to prevent similar events from occurring, and in recognition of the previous escalated enforcement action against Terracon, I have been authorized to issue the enclosed Notice of Violation and Proposed Imposition of Civil Penalty (Notice) in the base amount of $2,750 for the Severity Level III violation described above.

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 may reference previously docketed correspondence in providing the required information. In addition, although we find your described corrective actions sufficient, we request that you provide additional details on your statement that you intend to enhance local radiation safety officer policing of gauge security at temporary job sites. The NRC will use your response, in part, to determine whether further enforcement action is necessary to ensure compliance with regulatory requirements.

In accordance with 10 CFR 2.790 of the NRC's "Rules of Practice," a copy of this letter, its enclosure, and your response will be placed in the NRC Public Document Room (PDR).

Sincerely,  
Ellis W. Merschoff
Regional Administrator
 

Docket No. 030-32176
License No. 15-27070-01

Enclosure: Notice of Violation and
   Proposed Imposition of Civil Penalty


NOTICE OF VIOLATION
AND
PROPOSED IMPOSITION OF CIVIL PENALTY

The Terracon Companies, Inc.
Lenexa, Kansas
  Docket No. 030-32176
License No. 15-27070-01
EA 98-124

During an NRC inspection completed February 26, 1998, 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 20.1802 states, in part, that the licensee shall control and maintain constant surveillance of licensed material that is an unrestricted area and that is not in storage. As defined in 10 CFR 20.1003, unrestricted area means an area to which access is neither limited nor controlled by the licensee.
Contrary to the above, on January 23, 1998, the licensee did not control and maintain constant surveillance of licensed material in an unrestricted area. Specifically, the licensee did not maintain adequate control or constant surveillance of a CPN Model MC1-DR portable nuclear moisture/density gauge containing a nominal 8-millicurie cesium-137 sealed source and a nominal 40-millicurie americium-241 sealed source. The licensee failed to secure a padlock on the gauge container, resulting in the theft of the gauge from a vehicle parked at a restaurant. (01013)
This is a Severity Level III violation (Supplement IV).
Civil Penalty - $2,750

Pursuant to the provisions of 10 CFR 2.201, The Terracon Companies, 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 the cumulative amount of the civil penalties if more than one civil penalty is proposed, 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(s) 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 copies to the Regional Administrator, Region IV, 611 Ryan Plaza Drive, Suite 400, Arlington, Texas 76011, and the Walnut Creek Field Office, 1450 Maria Lane, Suite 300, Walnut Creek, California 94596.

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. If personal privacy or proprietary information is necessary to provide an acceptable response, then please provide a bracketed copy of your response that identifies the information that should be protected and a redacted copy of your response that deletes such information. If you request withholding of such material, you must specifically identify the portions of your response that you seek to have withheld and provide in detail the bases for your claim of withholding (e.g., explain why the disclosure of information will create an unwarranted invasion of personal privacy or provide the information required by 10 CFR 2.790(b) to support a request for withholding confidential commercial or financial information). If safeguards information is necessary to provide an acceptable response, please provide the level of protection described in 10 CFR 73.21.

Dated at Arlington, Texas
this 15th day of May 1998


1. The NRC's Enforcement Policy states in Section VI.A that generally, licensees are held responsible for the acts of their employees and that the policy should not be construed to excuse personnel errors.

2. On November 17, 1997, the NRC issued a $5,000 civil penalty to Terracon for a willful failure to provide gauge operators a manufacturer's training course (EA 97-425).

 

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