Radioactive material is commonly used in certain industries, such as energy and petrochemicals, as part of flow measuring equipment and similar devices. The control of radioactive material is essential to minimize the risks posed by loss, theft, inadvertent exposure and potential misuse by bad actors. Federal and state regulators implement processes to promote the appropriate control of those materials. Nonetheless, a 2016 GAO sting operation allowed investigators to obtain licenses permitting them to purchase significant quantities of radioactive material. The serious flaws in Texas’ pre-licensing activities this investigation identified resulted in a shake-up at the Texas regulator and an increased focus on pre-licensing activities.

The Regulation of Radioactive Material—A Historical Perspective

Radioactive material is commonly used in the energy and petrochemicals industries. For example, devices containing radioactive material in sealed sources are used to measure fluid flow and density, to determine the volume of liquid in tanks, and to detect flaws in metal and welds between components. The use, storage and transfer of radioactive material is often managed by companies’ health, safety and environment personnel.

The health risks posed by this material depend on the radioisotope, its activity level, the duration of exposure, and the nature of exposure, such as inhalation, ingestion, or external exposure. Health effects can range from no discernable damage to severe injury (including cancer) or even death.

Because radioactive material can be dangerous to human health, the U.S. Nuclear Regulatory Commission (“NRC”) and the Agreement States1 have developed regulations that require appropriate oversight and physical control. Control of radioactive sealed sources in the U.S. has historically focused on ensuring that such sources were appropriately licensed, used and stored. Since the September 2001 terrorist attacks, concerns have grown that terrorists could obtain radioactive material and use it to make a dirty bomb.

In 2003 and again in 2005, the NRC and Agreement States issued orders to protect radioactive material from theft, diversion or other unauthorized access.2

Regulatory Weaknesses and Efforts to Plug the Holes

Despite the efforts of the IAEA, NRC and Agreement States, weaknesses in the regulatory structures persisted. In 2007, Government Accountability Office (“GAO”) investigators obtained a radioactive material license from the NRC after applying for it in the name of a fictitious company. The investigators then altered that license and entered into contracts with radioactive material suppliers to purchase a dangerous quantity of radioactive material.

As a result of that investigation and others which showed similar weaknesses, the NRC bolstered its ability to track the use and transfer of the more dangerous categories of radioactive material through the use of three databases3 and an increased focus on pre-licensing activities. In this regard, the NRC issued revised pre-licensing guidance to NRC and Agreement State licensing staff. Among other revisions, this guidance suspended the “good faith presumption”4 and required licensing staff to conduct pre-licensing site visits for applicants who were not known to the regulations.5 Pre-licensing site visits are intended to provide a basis for regulatory confidence that the applicant will use the radioactive material as specified in the license. The NRC also established a detailed checklist to guide pre-licensing site visits and developed a list of questions and activities related to the applicant’s business operations, facility, radiation safety operations and personnel qualifications.

  1. The NRC has entered into a series of agreements with state governments that delegate certain authority regarding the regulation of radioactive material to state governments. States that have entered into such agreements are termed “Agreement States.” States that have not entered into such agreements are termed Non-Agreement States. The NRC retains the authority to regulate radioactive material in Non-Agreement States, in offshore waters and in other areas of exclusive NRC jurisdiction.
  2. These additional security requirements have been incorporated into NRC regulations, including 10 C.F.R. Part 37; all Agreement States have fully implemented compatible requirements to Part 37 as of 2016.
  3. The National Source Tracking System, the Web-based Licensing System and the License Verification System.
  4. The “good faith assumption” allowed licensing staff to assume that applicants and licensees did not have malicious intentions and that they would be honest and truthful in providing information to regulators.
  5. Prior to June 2007, such visits were optional except in cases where the proposed use of radioactive materials involved unusually complex technical, safety, or unprecedented issues or were otherwise judged to be high risk.