Outline

1. Recent NRC Activitiesin Materials SecurityGeorge Pangburn, Deputy DirectorOffice of Federal and State Materialsand Environmental Management ProgramsDecember 14, 2007

2. Outline • Fingerprinting requirements for Increased Controls Licensees • Government Accountability Office (GAO) Investigation and Senate Hearing

3. Increased Controls • Issued December 1, 2005, FRN 72128 • Trustworthy and Reliability (T&R) determinations required for unescorted access to radioactive material quantities of concern • Based on verification of: • Employment • Education • Personal references • Non-Manufacturing and Distribution (non-M&D) service providers need to be escorted

4. Energy Policy Act of 2005 In accordance with Section 652 of the Energy Policy Act (EPAct), the Commission shall require to be fingerprinted any individual who: A) is permitted access to Safeguards Information (SGI) under Section 149 of the Atomic Energy Act B) is permitted unescorted access to • a utilization facility, or 2) radioactive material or other property subject to regulation by the Commission that the Commission determines to be of such significance to the public health and safety or the common defense and security as to warrant fingerprinting and background checks.

5. EPAct’s Section 652 Provisions • All fingerprints shall be submitted to the U.S. Attorney General (i.e. FBI) through the Commission for identification and a criminal history records check • EPAct did not provide an implementation period • Currently, NRC requires fingerprinting and criminal history checks for M&Ds, panoramic irradiators, and RAMQC licensees • This is being accomplished through immediately effective Orders

6. Implementation Schedule • Fingerprinting Orders were issued to NRC Increased Controls licensees on December 5, 2007 • Licensees have 60 days to notify the NRC if they are unable to comply with the requirements of the Order or if compliance is unnecessary • Licensees have 90 days to fingerprint and approve a Trustworthiness and Reliability (T&R) Official if he/she has unescorted access to material • T&R Official is the individual who will be making the T&R determinations for individuals who require unescorted access • Licensees will have 180 days to complete implementation of the program

7. Agreement State Implementation • Agreement Stated Increased Control Licensees will receive similar requirements within 180 days. • Some States may have legal impediments to issue fingerprinting requirements • On Nov. 20 NRC sent a letter to Agreement State Radiation Program Directors requesting that States notify NRC by Nov. 30 of difficulties implementing requirements.

8. Do blood irradiators contain the specified quantities? • Yes. Blood irradiators typically exceed the Category 2 threshold quantities. What’s the Cost? • NRC currently charges $36 per person to process and submit fingerprints to the FBI • Additional fees could be charged by local law enforcement and/or private companies authorized to do fingerprinting

9. How long does it take to process fingerprints? • The NRC administrative process is a few days and the FBI turns around the results within 24-48 hours. Is there a “grandfather” clause for current employees? • Employees who currently are already determined to be trustworthy and reliable under the IC Order can continue to have unescorted access during the 180 day implementation period.

10. Will “interim” clearances be allowed? • No. What is the process to have the requirements modified to exempt blood irradiators? • The Director of the Office of Federal and State Materials and Environmental Management Programs, may, in writing relax or rescind any of the requirements upon demonstration of good cause by the licensee.

11. 2007 GAO Investigation • Formed Bogus Company and Obtained NRC License • Altered NRC License • Two Suppliers Agreed to Sell Material • Parallel Attempt to Obtain Agreement State License Aborted When Notified of Site Visit

12. Short Term Actions Taken • Discussed with GAO Investigators • Terminated the NRC License • Stopped Issuing New NRC Licenses Until Interim Guidance Issued • Pre-Licensing Visits or Meetings for New Applicants • Restarted Pre-Licensing Working Group

13. Short Term Actions Taken (continued) • Coordinated with Federal and State Partners • Performed Consequence Assessment and Shared with GAO • Retrospective Examination to Assure Licensees are Legitimate

14. GAO Recommendations • Mandatory Pre-Licensing Visits • Periodic Oversight of License Reviewers • Explore Prevention of License Counterfeiting

15. Senate Staff Recommendations • Permanent Subcommittee on Investigations: • Reevaluate “Good Faith” Presumption • Regulate Category 3 More Closely • Ensure Only Authorized Persons Get Radioactive Material

16. OIG Recommendation • Independent External Panel to: • Identify Vulnerabilities in Material Licensing • Validate the Agency’s Byproduct Material Security Efforts

17. Action Plan Overview • External Review • Pre-Licensing Working Group • Materials Program Working Group • National Source Tracking System (NSTS) and Web-Based Licensing (WBL) • General Licenses and Outreach • Agreement State Partnership

18. Staff’s Plan • Comprehensive and Responsive • Short-term, Mid-Term and Long-Term Actions • Independent, External Program Review • Comprehensive Internal Assessment