The amended reorganization plan before you continues to assign to the full Commission those functions which benefit by collegial deliberation by the members. These are policy formulation, rulemaking and adjudication the substantive heart of nuclear safety regulation. In sum, the Commission has the task of setting the policy and seeing to its proper implementation in Commission rules and adjudicatory decisions, including those in the post-licensing enforcement phase.

In Commission decisions on the above matters, each member will continue to have responsibility and authority equal to that of the other four members. Decisions will be by majority vote. The Plan authorizes the Commission to delegate part of these functions to the Chairman or to any other member. This corrects a limitation of the current law which prevents efficient conduct of business through delegation of defined authority to a member where this may be useful in the view of the majority.

I want to emphasize that the Commission majority remains the ultimate authority in setting nuclear safety policy. The Plan leaves its regulatory powers intact in providing policy direction to staff through the Chairman, and to affected interests outside NRC. The studies have shown that the Commission has lagged in providing such direction, for example, in resolving generic issues of nuclear safety applicable to a number of installations. They also have participated in a few reactor licensing cases over the years. This Plan is designed, in large part, to free the members from the administrative details that have distracted them from deliberating and resolving policy and adjudicatory issues the task for which the Commission was created.

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The Plan places in the Chairman all functions not vested in the Commission. These include the responsibility of serving as principal executive officer and official spokesman of the agency. The principal executive officer role includes determination of the use and expenditure of funds and presentation to the Commission of the annual budget and any major reorganization. The Chairman is also vested with supervision of the staff, including the EDO, and for assuring that it is responsive to the needs of the Commission. The EDO reports directly to the Chairman for all matters. The Chairman will take the lead in planning for policy development and presentations to the Commission. Finally, and very importantly, the Chairman will initiate all key appointment and removal actions.

Clarifying Reporting Relationships Let me now spell out the basic reporting relationships among NRC officials that follow from the proposed reorganization as amended. Panels which carry out adjudicatory functions the Atomic Safety and Licensing Board and the Atomic Safety and Licensing Appeal Panels would receive their functions by delegation directly

from the Commission and would report to the Commission. The Advisory Committee on Reactor Safeguards would also continue to report to the Commission. Several of the Commission-level offices that closely support the Commission's work, such as that of the General Counsel and Policy and Evaluation, would also so report.

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Distinct from the adjudicatory panels and staff units to the Commission, the line organization of NRC reports to the Executive Director for Operations, who in turn reports to the Chairman. This is a fundamental change in the presentlaw and is necessary to provide the unified management that is sorely needed. The single most debilitating flaw in NRC's management is the current structure whereby the heads of operating offices report to five individual Commissioners, at least in an arms-length, formal manner. Such an arrangement contributes to irresponsible management, with no one really in charge or accountable.

Instructions to the line offices would come from the Executive Director for Operations, acting under the supervision of the Chairman. The EDO as well as the Chairman, is charged with following the policies set by the Commission. Office heads have had no one from top management with clear authority to set priorities or resolve conflicting instructions. Office heads have often had to clear proposed actions with all five Commissioners who, of course, frequently disagree. Coordination among offices in meeting program objectives requires a strong Executive Director as their immediate supervisor. Negotiating with Commission members to obtain management policy direction requires a strong Chairman who is closely linked to the EDO acting as his day-to-day agent.

The reorganization will finally make it clear to key officials to whom
they report and who reports to them. There will be a clear line from top
management to successive levels of organization. There is far less danger
of matters falling between the tracks when someone is responsible for seeing
that this does not happen. Accountability for actions or inaction will be fixed;
a critical consideration in nuclear safety.

A concern that has been expressed is that a single line of command may result in "muzzling" the staff. I believe the Section-by-Section analysis submitted in connection with the original Plan basically resolves this concern by demonstrating that the Commission has full access to all information it requires and that the Chairman cannot block the flow of information. The amended plan makes this even more explicit. As an additional safeguard, the Plan specifically authorizes any officer or employee to communicate directly with the Commission, or to any member, when they believe a critical problem of health, safety or national security is not being addressed. This provision in law is in addition to the Commission "open door" policy that permits any staff member to contact a Commissioner on any matter when he believes such action is warranted.

Personnel Authority - I will now speak to the provisions of the Plan dealing with authority to appoint and remove staff. The Chairman would be authorized to initiate all key appointment actions, thereby fixing responsibility for seeking to fill vacancies which in the past have sometimes gone unfilled for extended periods. The Plan specifies that the Commission

shall approve selection by the Chairman to specified key positions which support the Commission's work, either by providing direct staff assistance or by heading the major line offices that support the adjudicatory and policy functions. In addition, he is directed to consult the EDO in initiating appointments to key program offices under the EDO. The Chairman or any Commission member may initiate action for removal from the positions, which would take effect upon approval of the Commission. In summary, the Commission will have authority to approve appointment and removal at the heads of four Commission-level offices, the EDO and the directors of the 5 major line offices. In addition, the Commission will control appointments of members of the adjudicatory panels and of the Advisory Committee on Reactor Safeguards.

Appointment to and removal from positions not specified for Commission approval are to be made respectively by the heads of Commission staff offices or by the Executive Director for line offices without further action by the Commission. Of course, the Executive Director will delegate most personnel authority to office heads who, in turn, will make selective delegations to subordinates.

Response to Emergencies

The accident at Three Mile Island revealed serious shortcomings in the capabilities of NRC, as well as others, to deal effectively with an emergency situation. This is partly attributable to legislative provisions that prevent the Commission from delegating emergency management to one of its members, although delegations can be made to staff. When a serious emergency arises, a politically accountable official should be designated to act as needed. Under the present system, several Commission members may try to deal with fast-breaking events requiring urgent decisions not susceptible to group deliberations.

Consequently, the Plan makes the Chairman responsible for dealing with incidents at a facility, or concerning materials licensed or regulated by the Commission. Such management functions include declaring an emergency, issuing orders, and advising the civil authorities and the public. The Chairman may delegate his emergency authority to any of the other Commissioners, to provide for contingencies, such as dual emergencies or the Chairman's temporary unavailability. Of course, delegations may continue to be made to staff.

The Chairman is best-suited to respond to an emergency because he best knows the organization and capabilities of key staff. Technical expertise is not personally required on the part of the person charged, with managing the emergency response but, of course, the designated member must know how to tap the experts and be able to make the necessary decisions.

The Chairman's authority in responding to an emergency is subject to prior Commission policy guidance and subsequent oversight. Advance planning for dealing with emergencies is developed within the Commission's policy guidelines. Upon termination of the emergency, the Chairman or other member delegated response authority shall render a report to the Commission on actions taken. If the Commission is not assured that the response was properly handled, it can initiate its own investigation.

Summing Up -- The greatest resource available to NRC is its expert staff. This resource is being poorly served and poorly utilized under the unfocused management that has characterized NRC. It needs to be supported by top management while subject to managerial discipline through clear lines of authority. It needs coherent policy direction which can only be provided by the Commission doing its job.

Through establishing the proper roles of the Commission, the Chairman, the Executive Director for Operations, and the staff, and having each concentrate on what each does best, nuclear safety will be advanced.

Mr. WELLFORD. Before I describe the reorganization plan, let me first state that we recognize that this plan is an incremental improvement in the operation of the NRC; we do not see it as a panacea for all of the problems there, but we do think it is a major step to remedy some of the defects that have been described by the Kemeny Commission, by the Rogovin report, by the GAO, and by other groups that have studied this agency in the last couple of years.

Let me say also that any reorganization plan, however well designed, is no substitute for highly qualified Commissioners and a highly professional staff.

We have been critical of the Commission and its operations, but I do not want to suggest that we do not have a great deal of respect for the people at the NRC who carry the heavy responsibility of nuclear safety. We want to free them to do a better job, and we think that this plan is going to do that.

There are a number of things we are doing outside of the plan which help to carry forward the President's goal of improving the general management and operating procedures at NRC. One of the foremost among them is our proposal to try to begin to consolidate the fragmented geography of the NRC.

As you may know, the NRC is scattered hither and yon through Greater Metropolitan Washington. We are going to begin a process of consolidating the offices of the NRC, hopefully in two basic locations, one here in Washington and one in Bethesda.

Let me describe what this plan accomplishes. We have three basic principles that we are trying to advance with this reorganization plan. The first and primary principle is that of accountability. If there is one common theme in all of the studies of the NRC since Three Mile Island it is that the NRC needs to have accountable, responsible management.

With this plan, the Chairman is made accountable for effective management of emergencies when they occur as well as for the dayto-day administration of the agency.

As the GAO report stated a couple of months ago, the NRC Chairman needs to be made the chief executive officer of the agency in fact as well as name.

We hope by this plan to permit each element of the Commission to concentrate on what it does best: The Commissioners in providing leadership-through policy development, adjudication, and rulemaking to the NRC staff, to the regulated industry, and to the public; and the Chairman and the EDO in providing day-to-day administrative management and execution of policy.

Finally, the principle of teamwork characterizes our plan. Rather than have the major program officers the line officers of the NRCact somewhat as independent duchies reporting individually to five Commissioners, and sometimes acting individually, we have established a more coordinated and orderly system for tasking the staff and for reporting within the agency.

Since the President submitted the reorganization plan to Congress on March 27, 1980, there have been hearings in the Senate, and we have had lengthy discussions with both Senators and Members of the House of Representatives about various aspects of the plan.

We know that any organizational change affecting nuclear energy is bound to be controversial, but our soundings have confirmed that the plan takes important steps to correct NRC's serious management problems.

Since the plan was introduced, we have proposed to the President several modifications which we think are consistent with the President's original intention to improve the management structure of the agency. These modifications respond to two concerns expressed by various Members of the House and Senate in reviewing the plan.

The first was to the effect that the Commission, acting by majority vote, should play a role in confirming the Chairman's selections of key program officers of the agency as well as the Executive Director for Operations. The second, which developed in the course of Senate hearings, was that the plan may tie up the Chairman in too much managerial detail, and as a result there should be greater reliance on the Executive Director for Operations to relieve the Chairman of some of the burden of day-to-day management.

Let me address the amendments to the plan specifically and then proceed to describe the effect and purpose of the plan, as amended. Several amendments have been made which underscore the collegial role of the Commission notwithstanding the added powers granted to the Chairman.

Four positions were added to the list of key selections by the Chairman which require Commission approval, whereas the original plan had the Chairman appointing them unilaterally. These are the Executive Director for Operations, the Director of Inspection and Enforcement, the Director of Standards Development, and the Director of Nuclear Regulatory Research. Each of these positions is directly or indirectly involved with substantive nuclear safety issues. They support Commission functions and have a major influence on the direction and performance of the agency.

This amendment continues to give the Chairman the added leverage of initiating selection and removal of these major officials, but the Commission will have an advise and consent role in these and other key positions in a manner which is common to other independent regulatory commissions.

Also in the area of appointments, we have proposed that the Advisory Committee on Reactor Safeguards, which is a group that advises the Commission as a whole, have its vacancies appointed through a process which permits members of the Commission as well as the Chairman to initiate the appointments..

There has been concern that the plan would permit the Chairman to restrict the flow of information to the Commission. This is neither intended nor provided by the original plan, nor is it by the amended plan. But to place greater emphasis on our original intent, the amended plan contains a specific requirement that the Chairman and the Executive Director for Operations, through the Chairman, keep the Commission fully and currently informed.

In addition, a few amendments have been made to further insure that executive and administrative powers are vested in the Chairman and, under his supervision, the Executive Director for Operations. The Chairman is explicitly given the function of taking the lead in planning for policy guidance and presenting it for consideration by the