TWENTY MILES NORTHWEST of Cincinnati, not far from the Indiana border, the cornfields and dairy farms of rural Ohio are suddenly interrupted by a massive industrial complex, 30 buildings on a thousand-acre site. Here the benignly named Feed Materials Production Center has operated for 31 years, its industrial appearance softened by dairy cows grazing on its land. Over the years the center has generally been little in the public eye. It wasn't until last December that many residents of tiny Fernald, Ohio, and environs learned that their mysterious industrial neighbor is in fact a pivotal U.S. nuclear weapons facility, a toxic waste dump and one of Ohio's major polluters. What the local residents -- and many of the previously unsuspecting workers at the plant itself -- discovered about the Feed Materials Production Center's operations has touched off an uproar that may force major changes in the way the federal government polices itself -- for the polluter of this quiet corner of Ohio is the United States government.

In ordinary language the Feed Materials Production Center is a uranium foundry. It belongs to the Department of Energy and is operated for the department by NLO, a subsidiary of NL Industries Inc., a corporation best known as the manufacturer of Dutch Boy paint. (In the days before lead became a dirty word, NL and NLO were known as National Lead and National Lead of Ohio, respectively.)

The foundry resounds with the clanks, crunches and shrieks of heavy machinery, much of which is so old that layers of paint can't disguise the wear and tear. At the foundry's receiving end arrive newly mined uranium ore and uranium compounds, from other nuclear plants, destined for reprocessing; from its shipping end depart metallic uranium ingots, rods and tubes -- "feed materials" for the nuclear weapons installations at Oak Ridge, Tenn., Rocky Flats, Colo., Hanford, Wash., and on Savannah River, S.C. Since the Fernald center is the nation's only primary uranium processing plant, its closure would pose serious problems for its customers.

For the most part, the process at Fernald is not terribly different from the foundry operations that produce steel, aluminum, lead and other metals. The ore is treated with chemicals that convert it to uranium trioxide and then is heated in massive furnaces to temperatures of more than 2,000 degrees Fahrenheit, deoxidizing the compound and reducing it to its pure metallic state. The molten uranium is cast into 300- 400-pound cake-shaped "derbies." Finally the derbies are tooled, polished and reworked into ingots of various sizes, rods and tubes.

But Fernald does have one key difference from other foundries -- uranium, the metal with which it works, is radioactive, mildly but definitely. Levels of radioactive uranium-235 in the metal at Fernald range from 0.2 to 2 percent, depending on the extent to which it has been enriched in the processing.

FOR THE FERNALD FOUNDRY, the quiet life began to end last Labor Day, when managers decided to replace some of the dust filters in Plant No. 9, the special products plant, where larger ingots are made. Each of Fernald's nine plant buildings has at least one smokestack, connected to a filter structure 20 feet high. The structure, called a baghouse, contains rows of woolen bags through which the foundry's air is forced, ostensibly filtering out most radioactive dust produced by foundry operations and preventing its escape into the open air. According to a subsequent Department of Energy report, management directed workers to replace old filter bags with new ones that were too small. A spokesman for NLO says the bags shrank because of moisture in the unit.

On Nov. 7 maintenance worker Carroll Varns got a call from Plant No. 9. "The radiation alarm is going off on the smokestack," he recalled he was told. When he arrived, Varns continued, the entire building was echoing with the howl of the alarm, warning lights were flashing, the radiation monitor was registering a radioactive leak -- and work in the foundry was proceeding normally. Varns shut the alarm off "so I could hear the foreman talk to me."

Then he stepped outside to get a good look at the radiation filter system. The rusty steel structure rises over three stories, a smokestack to its side. Varns climbed the ladders to the top of the baghouse, opened the single tiny access door and peered in. From his vantage point he could only see a few of the wool bags stretched between steel rods, not the full 25 feet of them. Those he could see looked all right, but still Varns figured the alarm was sounding because the bags weren't doing their job. He climbed back down.

"I told the foreman we probably were leaking radioactive material out the stack, but I couldn't say for sure. I said we should shut the plant down and take a look inside the baghouse or get plant physics (the unit that monitors radiation leaks) out and have them check the emissions from the stack for radiation. Well, he said, 'No, I can't do that. I'm under orders to silence the alarm and go on.'

During the 15 minutes he was at Plant No. 9, Varns recalled, the alarm was triggered four times. Coworker Bob Schwab said the alarm sounded repeatedly during November: "Every three or four minutes it would blast away."

Weldon Adams, assistant manager of the foundry, said management figured there was something wrong with the radiation monitor that month. Pointing to the monitoring device, Adams said, "See here where it says 'times 100,' 'times 10,000'? Well, when the alarm kept sounding, and they couldn't see anything wrong in the baghouse, our people just readjusted the sensitivity of this monitor."

Even with the sensitivity exponentially readjusted, however, the radiation alarm kept sounding. On Nov. 29, according to workers, two workers removed the valves at the bottom of the filter system to clean out what was thought might be a sludge residue that was setting off the alarm. "When these men released that valve," Schwab said, "approximately 300 pounds of black uranium oxide came out. It was like huge sacks of flour had been dropped from an airplane. It covered these men."

No radiation checks were done on them until two weeks after the incident -- too late to assess the radiation dose they had received. A management spokesman said the checks were not ordered earlier because management was not aware at the time that the spill had taken place.

The incident occurred at a time when Fernald workers were beginning to grow concerned about occupational safety issues and complaining to local reporters. So on Dec. 7 the Department of Energy and NLO conducted a joint press conference at the plant. They informed reporters that since the previous Labor Day, 275 pounds of radioactive material had been emitted from the smokestack on Plant No. 9. When some reporters expressed astonishment, assistant manager Adams sought to downplay the leak. "That's not so bad," he said. "Last year we lost about 330 pounds, and that was a good year."

Outraged local residents protested to their congressman, Rep. Thomas Luken (D-Ohio), and he demanded further information from the Department of Energy. Luken was appalled by the amplification. "Since 1951 some 200,000 pounds of radioactive material (a figure DOE later raised to 383,000 pounds) have been emitted into the atmosphere," he reported to his constituents. "Fernald has become a dump," he added. "It's a vital nuclear facility, but it's a dump."

NLO said its baghouse dust collectors are intended to be 99 percent efficient. The filters have occasionally failed, the spokesman added, but on no occasion have the seven monitors at the boundaries of the plant ever indicated that airborne uranium dust was exceeding acceptable levels. Both NLO and the Department of Energy have said they are confident that no one outside the plant has ever been endangered by exposure to uranium spills or leaks.

THERE HAD BEEN other earlier, but not widely noticed, signs of trouble at the plant. In January 1980 Cincinnati students and environmental activists who had banded together as Citizens Against a Radioactive Environment -- CARE, that is -- successfully pressed a Freedom of Information Act request that produced a series of NLO internal reports to the Department of Energy disclosing spills and management fears of spills at the plant.

Among the disclosures: 2,000 pounds of radioactive material had spilled from the Fernald plant into the Great Miami River between 1962 and 1979. (The NLO said later that it was only mildly radioactive.) Some 3,800 pounds of radioactive gas were emitted from the plant in a 1966 accident. (The NLO commented later that little left the site.) In 1979 NLO suspected that a large leak of radioactive material had occurred under- neath Plant No. 6. (The NLO later

commented test cores that were

drilled showed that there was no

spill beneath the floor.) Every day

Fernald was flushing 500,000 gallons of waste water into the Great

Miami River. (The NLO later said

the waste water was monitored and

was normally "well within federal

and state limits." On the rare occasion when limits were exceeded, the

waste water was recycled for retreatment.)

In January 1984, the Department of Energy reported that

nearly 10,000 tons of highly radioactive radium was stored in concrete silos at the Fernald plant.

More recently the department's Joe

LaGronne said there are "six open

unlined waste pits at Fernald," containing more than a half-million tons

of radioactive waste "dating back to

the Manhattan Project (of World

War II). I don't know exactly what is out there. I don't think anybody knows."

Last month the department published a survey of radioactive waste emissions, accidents and dumpings at its seven major fuel processing plants. The report diminished LaGronne's initial estimates of radioactive material stored at rnald to 5,779 tons and added that the waste is emitting 1,750 curies of radiation. The report also acknowledged that no documentation is available on the amounts of radioactive material buried at Fernald or what isotopes are involved for the period of 1955 to 1960 even though its charts indicated that this was a peak period of waste burial there. (A second peak period began in 1980 and is still continuing.)

LaGronne is worried that waste is leaking into the local aquifer, polluting drinking water supplies. Apparently the department has been concerned about possible leakage for some time, although it is only now discussing it. In 1981, at its request, the U.S. Geological Survey studied local water supplies, but the findings were not announced until Luken obtained the report and issued it last January. There was reason for "increased concern" about uranium in most local water, the report said. Three wells showed significant levels of unusual metallic contamination.

One of the three wells is in the Crawfords' old back yard. Ken and Lisa Crawford and their son, Kenny Jr., 8, used to live across the street from the Fernald plant and draw their water from a well. With the issuance of the report, they learned that their drinking water contained uranium (250 micrograms per liter), strontium (220 micrograms per liter), barium (53 micrograms per liter) and beryllium (1 microgram per liter). The U.S. has no current standard for uranium contamination of drinking water. The Crawfords' well had 40 times the EPA's proposed limit of 6.8 micrograms per liter.

The Crawfords rented their 19th century farmhouse from Knollman Farms, a dairy that owns considerable land around the Fernald plant. Some of its land is leased to tenants like the Crawfords; dairy cows graze on much of the remainder. Knollman cows also graze in meadows on the Fernald foundry grounds.

"The DOE sent us a letter stating about the well," said the dairy's Norman Knollman, "but they led us to believe it was just a certain percentage of the allowable limit . . . We were never told there was any danger."

"We've been drinking that water for seven years," says Ken Crawford, "and the government knew at least five years ago that it was contaminated, and nobody told us." (Knollman confirmed that he hadn't told the Crawfords about the well. "The DOE said there was no danger, so I didn't see any reason to tell them anything," he said.)

Ken Crawford is low-key about his feelings; he almost whispered as he talked about "the government." Lisa Crawford is outspoken and direct. "I'm mad," she said. "Furious, outraged, angry!" Before they learned about their water, the Crawfords were "just your average

American family," she said. "You know, we never dreamed anything like this could happen. And now all of a sudden we're thrown in the middle of milligrams, micrograms, radiation, TV crews, reporters . . . and we really don't know what to do."

Three generations of Crawfords have lived in Fernald, but Ken Crawford has now moved his family out of the area. The Crawfords and more than 100 other residents in the vicinity of the plant have filed a $300 million lawsuit against NLO. In its initial response NLO denied injuring the complainants. Ohio Attorney General Anthony J. Cele has put the Department of Energy on notice that the state of Ohio may bring suit as well if the department fails to comply with state environmental and occupational standards.

In March, continuing questions by local reporters led to a disclosure by NLO management that the Fernald plant had, on occasion, reprocessed materials from other nuclear plants that included trace elements of plutonium. Plutonium -- highly radioactive and carcinogenic and a deadly poison -- is far more dangerous than uranium. It often is handled in special containment facilities that do not exist at Fernald. An NLO spokesman said that workers were warned when material with trace plutonium was passing through the system and that the amounts were very small, "measured in parts per billion." In all the years Fernald has handled less than three ounces of plutonium, he said. NOT FAR from Fernald is a former Shaker village now full of young professionals who commute to work in Cincinnati. Nurse Kathy Meyer lives with her husband, Don, and two young children in a modern house just down the road from the old Shaker meeting hall. Kathy Meyer has been organizing local residents and fighting hard to get more information about Fernald. The biggest problem, she said, is trying to figure out exactly what years of living near the Fernald plant means for the health of local residents. "We hear so many things," said Meyer, "One expert says, 'Oh, you'll definitely get cancer,' and another one says 'No problem.' And that's making it very hard for the community here."

The Fernald community wants answers, and the DOE and NLO are trying to reassure it the doses it received are harmless. Fernald's Adams is one of that view's most active spokesmen.

As I spoke with the Meyer family in their home, Adams dropped by to share a Los Alamos radiation study with them. The unpublished 1982 study claimed to have administered daily doses of radiation to mice -- doses generally considered lethal -- and the mice not only survived, they lived longer than unradiated mice. "That's not surprising," said Adams, "Some people sit in radon tunnels in Colorado to get cured of arthritis." Adams went on to tell the Meyers that there is a threshold for radiation exposure; below the threshold radiation is harmless, perhaps even helpful. Above that threshold dose, he said, radiation can be harmful. "And everybody here in the Fernald area has received doses below that threshold," said Adams.

On another occasion, on a tour of the Fernald plant, Adams demonstrated his personal confidence in the threshold theory by picking up a small derby. "See, this is uranium," he said. "You don't think I would hold it like this in my bare hands if I thought it was dangerous, do you?"

ALTHOUGH ADAMS remains an enthusiast of the threshold theory of radiation exposure, the Department of Energy dropped its earlier reliance on it years ago. The department's Dr. Charles Gilbert said recently that there is no safe level of radiation exposure; rather, the risk of contracting cancer or encountering other health problems from radiation exposure is proportional to the amount of radiation received. But Gilbert, a physician in the department's defense programs division, noted that "the levels of uranium these people were exposed to in Fernald are very, very low" and expressed doubt that any residents or workers would suffer health problems as a result.

Gilbert based his assessments on the "quadratic linear" formula for evaluating radiation hazards. This formula rests on the belief that small amounts of radiation present very small risks to people exposed but that the hazard increases exponentially -- not simply in a straight line -- as the dose increases. The validity of this approach has been hotly debated by scientists over the years. Those who support the quadratic approach argue further that eliminating very low exposures to radiation is too expensive to be worthwhile.

On the quadratic side are researchers like Dr. Eugene Saenger, a radiologist at the University of Cincinnati Medical Center who has conducted a number of research projects for the Energy and Defense departments over the years. His findings are frequently cited by the agencies when they are questioned about their activities. (In his most controversial study, a 1972 project funded by the Department of Defense, Saenger subjected 16 Cincinnatians suffering from terminal cancer to whole-body radiation. Before and after the irradiation, the patients took a battery of psychological and intellectual tests, and their thinking powers, before exposure and after exposure, were compared. The project was later criticized by the Senate subcommittee on health, which said Saenger's purpose was "to fulfill the Pentagon's aim of finding out how soldiers would react in battle to the radiation of an atomic attack." Sanger said his purpose was mainly therapeutic.) "It is very hard for me to see how these people are in any way at risk," Saenger said of the Fernald situation. He said that most of the uranium dust found inside the foundry's buildings is heavy, composed of large uranium particles that are not easily absorbed in the lungs. Because of its weight, he added, it is unlikely to be carried far by local winds or water.

The 383,000 pounds of uranium dust emitted from the Fernald plant over the last 31 years could fit into about 12 large pickup trucks, he said. "That's about one pickup truck going by every two years. And if you saw one pickup truck every two years, you wouldn't think that was anything to get upset about."

On the opposite side of the debate over the hazards of low-level radiation is Dr. John Goffman, a radiologist on the faculties of the University of California at Berkeley and at San Francisco. Goffman, who has studied the victims of Hiroshima and Nagasaki, has been an outspoken critic of the Department of Energy for many years. Department officials vigorously challenged the reliability and responsibility of his findings.

Goffman said that residents of the Fernald area have reason for concern. "It is absurd to talk about pickup trucks full of uranium dust," he said. "One gram of uranium can and will cause cancer: not a pickup truck full, but minute amounts of uranium can and will cause cancer in proportion to the doses . . . The only safe exposure to radiation is no exposure at all."

GOFFMAN SAYS the Department of Energy has a virtual monopoly on information about radiation. More than 60 percent of all radiation research done in this country is done by the department or department contractors. The Department of Energy is the only federal agency that is entirely self-regulating. It sets its own standards for radiation exposure, monitors compliance with those standards and oversees the health and safety of its workforce. Government regulators that monitor environmental safety and health in other government agencies and in the private sector are not permitted to enter DOE facilities without the department's permission.

For example, the Fernald plant is only a few miles away from the National Institute for Occupational Safety and Health, which is based in Cincinnati. NIOSH is the research arm of the Occupational Safety and Health Administration; it employs some of the nation's top toxicologists and occupational health specialists. According to Jerry Flesch, assistant chief of the institute's hazard evaluation branch, union members approached NIOSH about the Fernald situation in early 1983. "We then approached the DOE's offices at Oak Ridge with our desire to follow up the workers' requests for information," said Flesch, "and in the fall of 1984 we got a tour of the plant and got an idea of what the basic operations were." But it was not an inspection tour. No NIOSH or OSHA inspections have ever been granted at Fernald.

After their Fernald visit, NIOSH officials asked for access to Fernald workers' medical records so they could conduct the first serious study of cancer cases, pulmonary fibrosis, lung disorders and other diseases that could be associated with uranium dust exposure. In November Ohio Gov. Richard Celeste added Ohio's name to the request. "There does not appear to be a clear, well-defined program for protecting the employes from the hazards that exist in this facility," the governor noted pointedly. NIOSH was finally granted access to medical records last April.

The Environmental Protection Agency has been equally restricted in its dealings with the Department of Energy. Asked whether Fernald is exceeding EPA air radiation emissions standards, Richard Guimond, the agency's director of radiation criteria and standards, said that the EPA has issued no such standards.

In the late 1970s the EPA considered setting tough new standards for radiation emissions, standards that would have applied to all private and government activities. Initially EPA proposed a standard of 10 millirems of radiation exposure per year per person. When the Department of Energy, the Nuclear Regulatory Commission and the Office of Management and Budget objected, EPA increased the proposal to 25 millirems per year. Then finally, in 1983, EPA's then-administrator, William Ruckelshaus, dropped the proposal entirely.

According to Guimond, EPA estimates indicate that Fernald's emissions of airborne uranium exceed the Nuclear Regulatory Commission's air radiation standards by 300 percent. According to Robert Tiller, who until April was deputy assistant secretary of energy for environmental safety and health, nobody connected with Fernald has received an unsafe dose of radiation. Overall, he added, the Department of Energy's safety record at its 21 nuclear weapons facilities is excellent: "Our records show we have decreased exposures threefold in recent years."

In 1980 the Congressional General Accounting Office offered a less sanguine assessment of DOE's past health and safety program. Reporting on a survey it had made, the office declared that the department's health statistics were "misleading" because its oversight of health and safety was inadequate. Worker complaints, said GAO, were not listened to, inspections were generally not carried out and those inspections that did take place tended to underestimate the hazards posed by radiation incidents.

"There was not complete agreement between DOE and GAO on that report," said Tiller. He specifically denied that worker complaints were ignored or accidents left uninvestigated.

Radiation exposure incidents at Department of Energy plants have been incompletely reported to DOE monitoring agencies and slow to be acted on in many cases, according to recent DOE re ports. At the Hanford plant, in Washington, for example, only 26 of 63 major contamination incidents that occurred last year were reported, a DOE official admitted last month. At the Portsmouth nuclear facility in Ohio, workers filed 92 contamination complaints between 1978 and 1979. DOE said that it investigated only half.

Fernald and its sister nuclear facilities throughout the country are now producing more enriched uranium and plutonium than at any time since the 1963 signing of the Nuclear Test Ban Treaty. Because of Reagan administration emphasis on increased military spending, the demand for uranium and plutonium is so high that Fernald is operating around the clock seven days a week.

Department of Energy inspection reports show that the increase in production has increased worker risk. In 1983 there was a 40 percent rise over the previous year in the accidental irradiation of workers' skin. Inspectors said employes' radiation badges showed an average of 13 overexposures a month. "The potential for significant radiation exposure to personnel is very real," said one recent department evaluation.

All of this has led Rep. Tim Wirth (D-Colo.), a high- ranking member of the House Energy and Commerce Committee, to introduce a bill to transfer responsibility for health, safety and environmental monitoring of Energy Department facilities to the Department of Health and Human Services. Sen. John Glenn (D-Ohio) is sponsoring a companion bill in the Senate.

Luken, the local congressman, backs the bill. Under the present system, he said, "the fox is guarding the chicken coop at DOE." Workers representative Geoffrey Sea went a step further. "It's worse than the fox guarding the chicken coop," he said. "It's the fox blocking the door and taking the inventory, telling everybody the chickens are all right and counting the eggs." CAPTION: Picture 1, Uranium cores await shipping to the Savannah River nuclear plant Aiken, S.C.; Picture 2, Lisa and Ken Crawford with their son, Kenny Jr. The Crawfords have filed a $300 million lawsuit against the NLO after discovering they had been drinking well water contaminated with uranium. Trailers hold containers that are used to ship readioactive material from other plants to Fernald for reprocessing. Photos by John McDonnell