Oystershell Alliance v. U.S. Nuclear Regulatory Com'n

• Decision Date: 09 September 1986
• Docket Number: No. 85-1182,85-1182
• Citation: 800 F.2d 1201
• Parties: , 17 Envtl. L. Rep. 20,008 OYSTERSHELL ALLIANCE, et al., Petitioners, v. UNITED STATES NUCLEAR REGULATORY COMMISSION and United States of America, Respondents, Louisiana Power & Light Company, Intervenor.
• Court: U.S. Court of Appeals — District of Columbia Circuit

Page 1201

800 F.2d 1201

255 U.S.App.D.C. 176, 17 Envtl. L. Rep. 20,008

OYSTERSHELL ALLIANCE, et al., Petitioners, v. UNITED STATES NUCLEAR REGULATORY COMMISSION and United States of America, Respondents Louisiana Power & Light Company, Intervenor.

No. 85-1182.

United States Court of Appeals, District of Columbia Circuit.

Argued Feb. 25, 1986.

Decided Sept. 9, 1986.

Lynne Bernabei, Washington, D.C., for petitioners. James B. Dougherty, was on the brief, for petitioners.

Carolyn Jourdan, Atty., Nuclear Regulatory Com'n, with whom Herzel H.E. Plaine, Gen. Counsel, Nuclear Regulatory Com'n., Peter R. Steenland, Jr., Chief, Appellate Section, Dept. of Justice, William H. Briggs, Jr., Sol., E. Leo Slaggie, Deputy Sol., Nuclear Regulatory Com'n., and Maria A. Iizuka, Atty., Dept. of Justice, Washington, D.C., were on the brief, for respondents. Thomas H. Pacheco and David C. Shilton, Attys., Dept. of Justice, Washington, D.C., also entered appearances for respondents.

Bruce W. Churchill and Charles H. Montange, Washington, D.C., were on the brief, for intervenor Louisiana Power & Light Co.

Before EDWARDS, BORK, and BUCKLEY, Circuit Judges.

Opinion PER CURIAM.

PER CURIAM

On March 15, 1985, the Nuclear Regulatory Commission ("NRC" or "Commission") approved the Atomic Safety and Licensing Board's ("Licensing Board") issuance of a full-power operating license for Waterford Steam Electric Station, Unit 3 ("Waterford-3"), a commercial nuclear power reactor owned by Louisiana Power & Light Company ("LP & L") and regulated by the NRC pursuant to the Atomic Energy Act ("AEA"). The NRC's approval was given notwithstanding the pendency before the Atomic Safety and Licensing Appeal Board ("Appeal Board") of two motions to reopen the administrative record filed by petitioners Oystershell Alliance and Save Our Wetlands.

Petitioners seek review of the March 15 decision, arguing that the Commission's licensing approval violated the Administrative Procedure Act ("APA") and the AEA because it was based on evidence outside the adjudicatory record. Petitioners also contend that the Commission could not lawfully authorize full-power operation of Waterford-3 without first resolving the issues raised in the motions to reopen.

These motions were subsequently denied by the Appeal Board and (with respect to one issue referred by the Appeal Board to the NRC) by the Commission, which ruled that petitioners had failed to meet the Commission's standards for reopening a closed record. Petitioners also seek review of this second decision, and the two matters are now before us.

We conclude that the NRC's decision to authorize full-power operation notwithstanding the pendency of motions to reopen was fully consistent with the statutory and regulatory requirements under which the Commission operates, and that the collateral objections raised by petitioners are without merit.

I. BACKGROUND

In 1978, eight years after it had first applied for a permit to build the Waterford-3 nuclear reactor and while the plant was still under construction, LP & L applied to the NRC for an operating license for the facility. It was at this stage that petitioners first intervened in the proceeding, citing several problems concerning the environmental and public health risks associated with the ongoing construction and future operation of the plant.

The Licensing Board ultimately approved the Waterford-3 operating license application and, in December 1983, the Appeal Board affirmed the Licensing Board's Order and issued what was intended at the time to be its final merits decision with respect to the Waterford-3 facility. Following the Appeal Board's decision, petitioners filed two motions to reopen the proceedings in order to consider new concerns relating to (1) the appearance of cracks in the concrete basemat on which the reactor was situated and (2) the character of LP & L's management and the adequacy of its quality assurance procedures at Waterford-3.

On March 15, 1985, while these two motions were pending, the Commission issued an order approving the Licensing Board's initial decision authorizing full-power operation of Waterford-3. In re Louisiana Power & Light Co., CLI-85-3, 21 N.R.C. 471 (Mar. 15, 1985). The Commission determined that the plant could operate without danger to the public health and safety on an interim basis, pending the Appeal Board's resolution of the motions to reopen. The Commission made it clear that its decision was "without prejudice to the [petitioners'] motions to reopen...." Id. at 471. Since that time both motions have been denied.

The Appeal Board rejected petitioners' basemat cracking claim on April 4, 1985, finding "no cause to recant its earlier findings that there are no significant safety concerns associated with cracking in the concrete basemat at Waterford." ALAB-803, 21 N.R.C. 575 (Apr. 4, 1985). On July 11, 1985, the Appeal Board similarly rejected all but one element of petitioners' motion to reopen on the management character/quality assurance issues. ALAB-812, 22 N.R.C. 5 (July 11, 1985).

The remaining issue involved petitioners' claim that ongoing investigations by the NRC's Office of Investigations ("OI") of LP & L's alleged falsification of records and harassment of quality assurance personnel demonstrated its management's lack of integrity. The Appeal Board did not have access to the information it felt it required in order to rule on this matter because the investigations were not yet completed, and the confidential information developed by OI could not be disclosed to the parties. The Board therefore referred this claim to the Commission for its disposition. Id. at 45-47.

In January 1986, the Commission issued a decision declaring that claim to be without merit and holding that petitioners had failed to meet the requisite criteria for reopening the case. CLI-86-1, 23 N.R.C. 1 (Jan. 30, 1986). Petitioners seek review of this final denial of their motion to reopen, and their review petitions of the March 15, 1985 and January 30, 1986 decisions are now before us in consolidated form.

II. DISCUSSION

We address the issues raised in each of the consolidated review petitions.

A. The March 15, 1985 Order Authorizing Full-Power Operation

Petitioners make a two-pronged attack against the Commission's March 15, 1985 Order authorizing full-power operation of the Waterford-3 facility. First, they contend that the Commission's decision was unlawfully based on information not contained in the administrative record in violation of both the APA's and the AEA's adjudicatory hearing requirements. Second, petitioners assert that the pending motions to reopen the record should have been resolved before the final operating license was issued.

These arguments reveal a misunderstanding of the procedures that must be followed before full-power operations may be approved.

1. Adjudicatory Hearing Requirements

Section 185 of the AEA establishes a two-stage process for the construction and licensing of nuclear power facilities. The first entails the issuance of a construction permit to an applicant whose application meets with the Commission's approval; the second involves the issuance of an operating license after the Commission is satisfied that all relevant requirements for the construction and operation of the facilities have or will be met. 42 U.S.C. Sec. 2235.

The AEA and regulations issued by the NRC pursuant to the Act provide the procedural framework for the Commission's exercise of its responsibilities at each stage. Before a construction permit is issued, and after appropriate public notice has been published, the Licensing Board must hold an adjudicatory hearing on the application. 42 U.S.C. Sec. 2239; 10 C.F.R. Sec. 2.104(b). On the other hand, hearings on operating license applications are held only when an interested person requests one, 42 U.S.C. Sec. 2239(a), 10 C.F.R. Sec. 2.714, or when the Commission sua sponte finds that a hearing is required in the public interest. 10 C.F.R. Secs. 2.104 and 2.105. Absent a party's request or a sua sponte determination to hold a hearing, "the Commission may ... issue an operating license ... without a hearing...." 42 U.S.C. Sec. 2239(a).

a. Examination of Extra-Record Evidence

In the event a hearing is not requested, and with respect to those areas not contested when one is, the Commission must examine all factors it considers relevant to the safety of the reactor. Thus in making its operating licensing determinations, the Commission must take account of all relevant information in the administrative record whether or not it is part of the adjudicatory record.

The Commission's ability to review the entire administrative record is particularly appropriate with regard to pending motions to reopen the record. As the Third Circuit recently stated in In Re Three Mile Island Alert, Inc., 771 F.2d 720, 732 (3d Cir.1985):

At the outset, we reject petitioner's contention that the Commission cannot rely on extra-record material in assessing the significance of evidence submitted in support of a motion to reopen the record. "Newly proferred material" is by definition extra-record. Because it is also "new" by definition, in the vast majority of cases, limiting the Commission's consideration of a motion to reopen to data already in the record would require that the moving party's allegations be accepted at face value. We think such a rule arbitrary and unworkable. If the Commission has, or can obtain through investigation, information bearing on the subject matter of a motion to reopen, we conclude that it should be free to use that information in deciding that motion.

In reaching its March 15 decision, the Commission was required to examine the petitioners' pending motions to reopen the formal adjudicatory record on the subjects of basemat cracking, quality assurance, and management competence. Of necessity, these motions introduced "newly proferred material" that...