Nuclear Materials Management

Peaceful Uses of Special Nuclear Materials

In connection with proposals for international peaceful uses of atomic energy, information was provided to several governmental groups studying the measures necessary to maintain appropriate accountability over the special nuclear materials required.

Tentative procedures were developed to facilitate distribution and control of special nuclear materials to be used in domestic peaceful applications, in anticipation of increased requirements for such materials.

Responsibility for compiling information on material requirements for all peaceful uses was centralized in the Division of Nuclear Materials Management.

Annual Meeting Change

The fifth annual meeting of AEC personnel to discuss accountability matters included for the first time a joint AEC-contractor session. The scope of future meetings will be broadened to include similar joint sessions on chemical and physical measurements, auditing and accounting, in addition to mathematical statistics.

Policy Review

The review of material management policy, projected in the previous semiannual report, has been initiated. Purpose of the review is to ascertain what policy changes, if any, are necessary in view of the increased volume and scope of Commission activities. Attention is being directed to possible need for differences in policy regarding licensees and contractors.

The financial incentive of licensees, in terms of charges for loss or use of material, presents an additional consideration. In this regard an evaluation is being made of the types of chemical reference standards needed as an aid to appropriate determination of quantities of materials transferred and on inventory.

Inspection

A statement of inspection policy applicable to AEC officers and employees and to contractors was approved by the General Manager. In connection with the important task of preparation of technical

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inspection standards and procedures, the collaboration of outstanding and experienced persons in the field of reactor technology is being sought.

Compliance Activities

An incident involving a fuel leak in the North Carolina State College reactor was investigated and the Division of Inspection .collaborated in technical evalution of the difficulty and formulation of remedial action.

Two official inspections were performed on the Pennsylvania State University reactor facility prior to and during initial operation. The Geneva installation and its operation were inspected prior to the opening of the Conference. Other inspections included:

The Bulk Shielding Facility, the X-10 Graphite Reactor, the Low Intensity Test Reactor, and the Tower Shielding Facility at Oak Ridge; the Materials Testing Reactor in Idaho, following an increase in normal power level; and the University of Michigan reactor, which is under construction.

Management Review

At the request of the General Manager a broad review of the policy and systems for accounting for source and special nuclear materials was undertaken.

Discussions were conducted with staff and program divisions for the purpose of encouraging the development of integrated field inspection programs. A continuing review of inspection reports compiled by staff divisions and operations offices was initiated by the Division of Inspection. A review of the systems of inspection utilized by headquarters offices and divisions is being conducted.

Construction and Supply

Construction activity continued to taper off during the first half of fiscal year 1956. During this period, capital investment in atomic energy facilities increased $155 million, bringing the total to $6.64 billion, before depreciation reserves. Monthly construction costs averaged about $26 million, a decrease of nearly 55 percent from the $57 million per month for the previous 6-month period. It is expected that costs will average about the same during the second half of fiscal year 1956.

Present construction activity continues to be mainly of production plant facilities. However, there was increasing construction activity

in connection with reactors of civilian and military significance, and such work is expected to become increasingly important in the construction program. During the past 6 months, work started on the Engineering Test Reactor at Idaho and on the Submarine Advanced Reactor test facilities at West Milton, N. Y.

New Headquarters Office Building

Public Law 31, 84th Congress, First Session, approved May 6, 1955, authorized the Atomic Energy Commission to construct a new headquarters building in or near the District of Columbia. After considering approximately 50 potential sites as a location, the Commission announced on July 29, 1955, that a site near Gaithersburg, in Montgomery County, Maryland about 23 miles northwest of downtown Washington had been selected for the building. It is planned that construction will be completed in the latter part of 1957.

Records Management

During fiscal year 1955 significant progress was made in the AEC records management program. This is the first year during which records disposal has exceeded records growth. A total of 94,414 cubic feet of records were disposed of, 105 percent of the volume generated during the year and an increase of 28 percent over the 1954 disposal rate.

Interchange of Scientific Facilities by Government Agencies

Certain unclassified AEC scientific equipment and facilities have been listed as available for use by other Federal agencies to the extent practicable and consistent with AEC work requirements. Designed to help this agency interchange, an inventory report, "Major Scientific Facilities and Equipment of U. S. Government Laboratories," was prepared by an Interdepartmental Committee established by Executive Order 10521. The Committee has as its broad objective the strengthening of the national scientific effort.

AEC's implementation of the report provides for (1) cooperation in making AEC-listed equipment and facilities available for other agency use and (2) use of the report to locate possible sources of supply to meet AEC needs for additional equipment or facilities.

Ore Freight Rates

Negotiations with western rail carriers to establish a lower scale of freight rates from potential ore-producing areas in Oregon, California,

and Nevada to Kalunite, Utah, and other processing points have resulted in a number of reductions ranging from 10 percent to 33 percent of the original rates. Negotiated in the interest of increasing uranium ore supply, such reductions are normally an incentive to ore production in the areas involved.

Small Business

Maximum practicable small business participation continued to be emphasized at each AEC operation and cost-type contractor purchasing office in line with the Congressional small business policy restated in the Small Business Act of 1953, as amended August 9, 1955, that a fair proportion of total supplies and services be procured from small business.

The rate of small business participation in AEC procurement increased in fiscal year 1955. During that period the subcontract dollars going to small business amounted to 46.6 percent of a total of $338.3 million. From July 1, 1951, to September 30, 1955, AEC cost-type contractors awarded $2.63 billion in subcontracts and of this amount $1.03 billion or 39.1 percent went to small business. Direct contract awards to small business during the same period amounted to $202 million or 3.2 percent of the total amount of AEC contracts ($6.274 billion).

Community Operations

Community Disposal

The Atomic Energy Community Act of 1955 was signed by the President on August 4. It provides for the disposal of federally owned properties at the communities of Oak Ridge, Tenn., and Richland, Wash., and prescribes a basis for the establishment of selfgovernment by the residents of the communities.

To carry out the Act, all properties at both Oak Ridge and Richland have been classified and plotted. The Federal Housing Administration has established offices at both locations and is proceeding with the appraisals of all real property which is to be offered for sale.

The Commission published, in the Federal Register of November 22, 1955, a proposed regulation to establish priority of purchase. allowing 30 days for comment. Comments were accepted until December 22, 1955, and the regulation was expected to be issued during January.

The Commission has recommended that all sales and financing functions under the Act be delegated to another Federal agency. A

total of 123 single residential lots, previously leased by competitive bid, have been offered for sale under provisions of the Atomic Energy Community Act of 1955.

The transfer of municipal installations to the new municipalities or other entities is not contemplated prior to fiscal year 1958. An application to purchase the community telephone system at Hanford has been received from the General Telephone Co. of the Northwest. The Commission is studying this application and possible transfer of other utilities under the criteria specified in the statute.

Ilousing and Community Facilities

Oak Ridge. A new "downtown" commercial center financed privately and built on land leased from the Government on a long-term basis, was opened officially on October 6, 1955, with 216,000 square feet of floor space available. Thirty-one business establishments were opened, 20 of them new to Oak Ridge. By the end of the year another 81,000 square feet of space had been added to the center.

Other areas. The Public Housing Administration on September 30 discontinued operation of the Waverly, Ohio, project of 400 temporary housing units provided for the construction workers at the Portsmouth plant. PHA contemplates discontinuance of all temporary housing activities in the Portsmouth area by March 31, 1956.

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Finance

The financial report of the Atomic Energy Commission for fiscal year 1955 contains more detailed financial information than the Commission has made public in previous years, including summaries of costs by years for 1950-55 inclusive in the major AEC program activities.

This latest financial report shows the financial position of AEC at June 30, 1955 and June 30, 1954, the results of operations for the fiscal years ended on these dates, and a summary of the history of the Nation's investment in the atomic energy program from June 1940 through June 1955.

Appropriations to AEC and its predecessor organizations for fiscal years 1940 through 1955 total $14.4 billion. AEC assets shown in the balance sheet total $9.1 billion at June 30, 1955. For security rea

See Appendix 8.