National Nuclear Security Administration
Additional Actions Needed to Improve Management of the Nation's Nuclear Programs Gao ID: GAO-07-36 January 19, 2007In response to security and management weaknesses, in 1999 the Congress created the National Nuclear Security Administration (NNSA), a separately organized agency within the Department of Energy (DOE). NNSA is responsible for the nation's nuclear weapons, nonproliferation, and naval reactors programs. Since its creation, NNSA has continued to experience security problems, such as unauthorized access to a NNSA unclassified computer system, and cost and schedule overruns on its major projects, such as the National Ignition Facility. GAO reviewed the extent to which NNSA has taken steps to (1) improve security at its laboratories and plants and (2) improve its management practices and revise its organizational structure. To carry out its work, GAO reviewed legislation; NNSA policies, plans and budgets; and interviewed current and former NNSA and DOE officials.
Although NNSA has begun to build an effective security organization, it still cannot demonstrate that all of its security program objectives are being met at all of its sites. Specifically, the results of internal and independent security oversight assessments have identified weaknesses in physical security at several NNSA sites, including the Nevada Test Site, Sandia National Laboratories and the Y-12 National Security Complex, and weaknesses in cyber security throughout NNSA. The following factors have contributed to this situation: Weak organization of headquarters security. Until recently, NNSA did not have consistent leadership or direction at the headquarters level for its security program. Security staffing shortages at NNSA site offices. Since NNSA became operational, five of its six site offices have not been staffed at the required levels, according to GAO's analysis. Site offices oversee NNSA contractor security operations. Inadequate security staff training. NNSA has not implemented a training program that provides federal security officials with the skills needed to effectively oversee contractor security programs. Incomplete security data. DOE's database for tracking security deficiencies identified by security oversight assessments is incomplete, and, as a result, NNSA lacks a comprehensive understanding of the overall effectiveness of its security program. NNSA has taken several actions to improve its management practices, including developing a planning, programming, budgeting and evaluation process. However, management problems continue, in part, because NNSA and DOE have not fully agreed on how NNSA should function within the department as a separately organized agency. This lack of agreement has resulted in organizational conflicts that have inhibited effective operations. GAO also identified the following areas where additional management improvements are needed: Project management. NNSA has not developed a project management policy, implemented a plan for improving its project management efforts, and fully shared project management lessons learned between its sites. Program management. NNSA has not identified all of its program managers and trained them to a certified level of competency. Financial management. NNSA has not established an independent analysis unit to review program budget proposals, confirm cost estimates, and analyze budget alternatives.
RecommendationsOur recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.
Director: Team: Phone:GAO-07-36, National Nuclear Security Administration: Additional Actions Needed to Improve Management of the Nation's Nuclear Programs
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Report to the Subcommittee on Strategic Forces, Committee on Armed
Services, House of Representatives:
January 2007:
National Nuclear Security Administration:
Additional Actions Needed to Improve Management of the Nation's Nuclear
Programs:
GAO-07-36:
GAO Highlights:
Highlights of GAO-07-36, a report to the Subcommittee on Strategic
Forces, Committee on Armed Services, House of Representatives
Why GAO Did This Study:
In response to security and management weaknesses, in 1999 the Congress
created the National Nuclear Security Administration (NNSA), a
separately organized agency within the Department of Energy (DOE). NNSA
is responsible for the nation‘s nuclear weapons, nonproliferation, and
naval reactors programs. Since its creation, NNSA has continued to
experience security problems, such as unauthorized access to a NNSA
unclassified computer system, and cost and schedule overruns on its
major projects, such as the National Ignition Facility. GAO reviewed
the extent to which NNSA has taken steps to (1) improve security at its
laboratories and plants and (2) improve its management practices and
revise its organizational structure. To carry out its work, GAO
reviewed legislation; NNSA policies, plans and budgets; and interviewed
current and former NNSA and DOE officials.
What GAO Found:
Although NNSA has begun to build an effective security organization, it
still cannot demonstrate that all of its security program objectives
are being met at all of its sites. Specifically, the results of
internal and independent security oversight assessments have identified
weaknesses in physical security at several NNSA sites, including the
Nevada Test Site, Sandia National Laboratories and the Y-12 National
Security Complex, and weaknesses in cyber security throughout NNSA. The
following factors have contributed to this situation:
* Weak organization of headquarters security. Until recently, NNSA did
not have consistent leadership or direction at the headquarters level
for its security program.
* Security staffing shortages at NNSA site offices. Since NNSA became
operational, five of its six site offices have not been staffed at the
required levels, according to GAO‘s analysis. Site offices oversee NNSA
contractor security operations.
* Inadequate security staff training. NNSA has not implemented a
training program that provides federal security officials with the
skills needed to effectively oversee contractor security programs.
* Incomplete security data. DOE‘s database for tracking security
deficiencies identified by security oversight assessments is
incomplete, and, as a result, NNSA lacks a comprehensive understanding
of the overall effectiveness of its security program.
NNSA has taken several actions to improve its management practices,
including developing a planning, programming, budgeting and evaluation
process. However, management problems continue, in part, because NNSA
and DOE have not fully agreed on how NNSA should function within the
department as a separately organized agency. This lack of agreement has
resulted in organizational conflicts that have inhibited effective
operations. GAO also identified the following areas where additional
management improvements are needed:
* Project management. NNSA has not developed a project management
policy, implemented a plan for improving its project management
efforts, and fully shared project management lessons learned between
its sites.
* Program management. NNSA has not identified all of its program
managers and trained them to a certified level of competency.
* Financial management. NNSA has not established an independent
analysis unit to review program budget proposals, confirm cost
estimates, and analyze budget alternatives.
What GAO Recommends:
GAO is recommending that the Secretary of Energy and the Administrator,
NNSA, (1) improve NNSA‘s security program, (2) develop and implement
standard operating procedures for conducting business and resolving
conflicts between DOE and NNSA, and (3) institute a series of
initiatives to improve project, program, and financial management. NNSA
generally agreed with the report‘s findings and corresponding
recommendations.
[Hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-07-36].
To view the full product, including the scope and methodology, click on
the link above. For more information, contact Gene Aloise at (202) 512-
3841 or aloisee@gao.gov.
[End of Section]
Contents:
Letter:
Results in Brief:
Background:
Additional Action Needed to Improve NNSA's Security Program:
Several Management Issues Need to be Resolved for NNSA to Become Fully
Effective:
Conclusions:
Recommendations for Executive Action:
Agency Comments and Our Evaluation:
Appendixes:
Appendix I: Comments from the National Nuclear Security Administration:
Appendix II: GAO Contact and Staff Acknowledgments:
Tables:
Table 1: Safeguards and Security Program Areas Covered in NNSA Surveys:
Table 2: Safeguards and Security Program Areas in Office of Independent
Oversight Inspections:
Table 3: Site Office Survey and Office of Independent Oversight
Inspection Results of NNSA's Overall Security Performance, Fiscal Years
1996 through 2000, Compared with Fiscal Years 2001 through 2005:
Table 4: Site Office Survey and Office of Independent Oversight
Inspection Results of NNSA's Physical Security Performance, Fiscal
Years 1996 through 2000, Compared with Fiscal Years 2001 through 2005:
Table 5: Site Office Survey and Office of Independent Oversight
Inspection Results of NNSA's Cyber Security Performance, Fiscal Years
1996 through 2000, Compared with Fiscal Years 2001 through 2005:
Table 6: NNSA Site Office Security Staffing Shortages, Fiscal Years
2001 through 2005:
Table 7: Staffing Levels within NNSA and DOE Offices:
Table 8: Major Projects Not Included in PARS:
Abbreviations:
DNS: Office of Defense Nuclear Security:
DOD: Department of Defense:
DOE: Department of Energy:
FTE: full time equivalent:
NIST: National Institute of Standards and Technology:
NNSA: National Nuclear Security Administration:
NSSP: Nuclear Safeguards and Security Program:
OMB: Office of Management and Budget:
PARS: Project Assessment and Reporting System:
PPBE: planning, programming, budgeting, and evaluation process:
SSIMS: Safeguards and Security Information Management System:
January 19, 2007:
The Honorable Ellen O. Tauscher:
Chairman:
The Honorable Terry Everett:
Ranking Minority Member:
Subcommittee on Strategic Forces:
Committee on Armed Services:
House of Representatives:
During the late 1990s, the Department of Energy (DOE) experienced
management difficulties with its nuclear weapons programs--
particularly with the lack of clear management authority and
responsibility--that contributed to security problems at the nation's
nuclear weapons laboratories and significant cost overruns on major
projects.[Footnote 1] According to a June 1999 report by the
President's Foreign Intelligence Advisory Board (the Board), DOE's
management of the nuclear weapons laboratories, while representing
"science at its best," also embodied "security at its worst" because of
"organizational disarray, managerial neglect, and —a culture of
arrogance."[Footnote 2]
The Board urged the Congress to create a new organization to oversee
the nuclear weapons complex and to insulate it from DOE. The Board
stressed that the new organization, whether established as an
independent agency or a semi-autonomous entity within DOE, should have
a clear mission, streamlined bureaucracy, and drastically simplified
lines of authority and accountability. Responding to the Board's
recommendations, in 1999, the Congress created the National Nuclear
Security Administration (NNSA) under Title 32 of the National Defense
Authorization Act for Fiscal Year 2000--the NNSA Act--to correct the
problems identified.[Footnote 3]
The NNSA Act established NNSA as a "separately organized agency" within
DOE and made NNSA responsible for the management and security of the
nation's nuclear weapons, nuclear nonproliferation, and naval reactor
programs.[Footnote 4] To implement its programs, NNSA relies on
contractors to manage day-to-day site operations and to adhere to DOE
policies when operating the laboratories, production plants, and other
facilities within the complex. Because many NNSA sites handle special
nuclear material, including nuclear weapons, plutonium, and highly
enriched uranium, effective federal oversight is critical to ensuring
that national security, human health and safety, and the environment
are not harmed.
The NNSA Act also established the position of DOE Under Secretary for
Nuclear Security, who was also designated as the Administrator of NNSA.
The Secretary of Energy and the Deputy Secretary of Energy were allowed
to establish policy for NNSA and to give direction to NNSA through the
Administrator; however, other DOE employees were prohibited from
directing the activities of individual NNSA employees. Furthermore, the
NNSA Act established, within NNSA, deputy administrators for defense,
nonproliferation, and naval reactors programs. Finally, the NNSA Act
required that, among other things, NNSA develop a planning,
programming, and budgeting process in order to ensure that the
administration operated under sound financial management principles.
Since its inception, however, NNSA has continued to experience both
security and overall management problems. For example, with respect to
security, in 2003 we reported that NNSA had not been fully effective in
managing its safeguards and security program.[Footnote 5] Specifically,
we found that NNSA had not fully defined the roles and responsibilities
of officials in its security program and that NNSA had shortfalls in
security staff at the site offices that oversee its contractors. In
addition, two NNSA studies commissioned in July 2003 found ongoing
problems with NNSA's security program, including weaknesses in its
security culture, organization, and staffing and training.[Footnote 6]
Finally, DOE's Office of Inspector General found security problems with
NNSA's contractors, including inadequate control of firearms
inventories and improprieties in the testing of the officers who
protect NNSA's sites. In terms of the management of major projects, the
National Ignition Facility and the Dual Axis Radiographic Hydrodynamic
Test Facility--two major facilities needed to support NNSA's nuclear
weapons programs--experienced major delays and cost overruns because of
problems with project management and are still not complete.[Footnote
7]
To implement the NNSA Act and in response to these problems, NNSA has
initiated a series of improvements, including recently creating a new
NNSA headquarters unit to oversee security across the nuclear weapons
complex; establishing a planning, programming, budgeting, and
evaluation process; and putting in place a policy to improve program
management. In addition, in December 2002, the Administrator
reorganized NNSA. Specifically, the Administrator (1) removed a layer
of management by abolishing NNSA's three operations offices located in
New Mexico, Nevada, and California; (2) removed some functions from a
fourth operations office at Oak Ridge, Tennessee, and established the Y-
12 site office; (3) strengthened the oversight role of its site
offices; (4) consolidated business and technical support functions,
such as procurement and contracting, into a single "service center"
organization located in Albuquerque, New Mexico; and (5) reduced NNSA's
staff by about 17 percent by the end of fiscal year 2004.
In this context, you asked us to evaluate the extent to which NNSA has
taken steps to (1) improve security at its laboratories and plants and
(2) improve its management practices and revise its organizational
structure.
To evaluate the extent to which NNSA has taken steps to improve
security at its laboratories and plants, we reviewed the security
requirements contained in DOE directives. We met with security
officials from NNSA headquarters and the NNSA Service Center in
Albuquerque; and at the Lawrence Livermore National Laboratory, Nevada
Test Site, Sandia National Laboratories, Los Alamos National
Laboratory, Pantex and Y-12 National Security Complex site offices. We
also met with security contractor officials at the Livermore, Nevada,
Sandia, Los Alamos, and Y-12, as well as with officials from DOE's
Office of Health, Safety, and Security (formerly the Office of Security
and Safety Performance Assurance). In addition, we met with former DOE
and NNSA officials, including the Director of NNSA's Security Workforce
Panel, and the Director of the NNSA Security Panel. In reviewing the
extent to which NNSA has taken steps to improve security at its
laboratories and plants, we collected and analyzed performance ratings
contained in security oversight reports, issued by DOE's Office of
Health, Safety and Security and NNSA site offices, from fiscal years
1996 through 2005. We used these performance ratings because there was
wide agreement among NNSA and DOE security officials that these ratings
represented the best available information on the overall performance
of NNSA's safeguards and security program. To assess the reliability of
security oversight report ratings, we (1) reviewed existing information
about the methodology and timeframes used in making performance rating
determinations; (2) interviewed knowledgeable agency officials; and (3)
based on document reviews, ensured that we had received all available
performance information. We determined that the data were sufficiently
reliable for the purposes of this report. We also used reports on
NNSA's security efforts prepared by GAO, the DOE Inspector General, and
outside groups, such as a 2005 report commissioned by NNSA.[Footnote 8]
To address the extent of security staffing shortfalls, we collected and
analyzed staffing data provided by NNSA site offices. We relied
primarily on staffing data from the NNSA site offices, as this data was
the most comprehensive and because these offices are responsible for
processing and managing security staffing requirements. To assess the
reliability of these data, we interviewed NNSA security officials who
were responsible for compiling these data and performed basic
reasonableness checks of the data. We determined that the data were
sufficiently reliable for the purposes of our report. Finally, we
reviewed documents related to NNSA's efforts to improve the
organization and operation of its security oversight program.
To evaluate the extent to which NNSA has taken steps to improve its
management practices and revise its organizational structure, we
reviewed the NNSA Act as well as two House of Representatives reports
in 2000 on the act's implementation.[Footnote 9] Because the
establishment of NNSA as a separately organized agency in DOE was a key
provision of the NNSA Act, we met with officials from NNSA
headquarters; the NNSA Service Center; the NNSA site offices; and DOE
offices where NNSA and DOE need to interact, including DOE's Office of
Intelligence and Counterintelligence (formerly the Office of
Counterintelligence), Chief Financial Officer, Chief Information
Officer, General Counsel, and Human Capital Management. To understand
how NNSA and DOE were intended to interact, we interviewed officials
and reviewed documents, such as DOE's January 2000 implementation plan
for NNSA. We also interviewed officials with the Department of
Commerce's National Oceanic and Atmospheric Administration, the Defense
Advanced Research Projects Agency, the Defense Threat Reduction Agency,
and the Department of Transportation's Federal Aviation Administration
to obtain their views on the reporting relationships that need to be in
place for an entity designated as a "separately organized agency" to
succeed. We contacted the first two agencies cited because they were
identified in the Board's June 1999 report as good models of a
separately organized agency. We contacted the latter two agencies cited
after consultation with staff in your offices. We also interviewed
former NNSA and DOE officials, including the first and second
Administrators and Deputy Secretary of Energy, who helped establish
NNSA, to get their perspective on the difficulties involved in creating
a separately organized agency within a department.
With respect to other management improvements, we met with officials
from NNSA headquarters, the NNSA Service Center, NNSA site offices, and
NNSA contractors; and various DOE offices, including the Office of
Engineering and Construction Management. To develop information on the
status of NNSA's efforts to improve project and program management, we
analyzed DOE's annual performance and accountability reports;
construction project data from NNSA's budget requests for fiscal years
1995 through 2005; and DOE program management performance information.
Finally, we reviewed documents on NNSA's planning, programming,
budgeting, and evaluation process and human capital efforts.
We conducted our work from March 2005 to January 2007 in accordance
with generally accepted government auditing standards, which included
an assessment of data reliability and internal controls.
Results in Brief:
Although NNSA has improved its headquarters oversight of security
across the nuclear weapons complex, NNSA still cannot demonstrate that
all of its security program objectives are being met at all of its
sites, according to our review of NNSA site offices' surveys and DOE's
independent inspections. We examined the results of the surveys and
inspections because NNSA and DOE security officials generally agreed
that the survey and inspection results represented the best available
information on the overall performance of NNSA's security program. The
surveys and inspections identify weaknesses with physical security at
several NNSA sites, including the Nevada Test Site, Sandia National
Laboratories, and the Y-12 National Security Complex, and weaknesses
throughout NNSA in the cyber security area. We identified, through
information review and interviews of various NNSA, DOE, and contractor
officials, the following four factors that have contributed to problems
with NNSA's security program:
* Lack of consistent leadership and direction for its security
activities. For several years, the NNSA headquarters security
organization experienced turnover in the position of Chief of the
Office of Defense Nuclear Security (DNS). Specifically, four
individuals have occupied the position since NNSA's creation, often in
an acting capacity. In addition, these chiefs have reported to
different levels within the organization. The current Chief is a
permanent appointee, reporting directly to the NNSA administrator, and
he has taken a number of steps to develop an effective headquarters
security organization.
* Security personnel staffing shortages at site offices. Having
sufficient staff to oversee the security programs of its contractors
continues to be a problem. For example, since NNSA became operational,
some site offices have experienced staffing shortfalls. As a result,
sites are limited in their ability to effectively oversee contractors'
security activities.
* Lack of adequate training resources and opportunities for site office
security staff. NNSA has not implemented a training program that
provides NNSA federal security officials with the skills needed to
effectively oversee contractor security programs. In addition, NNSA
site offices often do not have all the resources needed to meet
training needs. For example, according to site office officials, the
Los Alamos Site Office did not receive training funds for fiscal year
2006 and the Nevada Site Office received a minimal training budget for
its security staff.
* Lack of data to gauge program effectiveness. NNSA does not have
complete data for tracking security deficiencies identified by security
oversight reviews and, as a result, does not have information regarding
the overall effectiveness of its safeguards and security program. NNSA
officials told us that while they believe security across the weapons
complex has improved, NNSA does not have sufficient data to support
this assertion. In addition, NNSA has not implemented a formal process
for sharing best practices or lessons learned to guide security
improvements. While best practices and lessons learned have been
communicated informally, a formal process could help ensure that
previously identified security deficiencies, such as, for example, the
retrieval of badges from terminated employees at one NNSA site, are
reviewed and corrected as necessary at other NNSA field locations.
NNSA has taken several actions to improve its management practices,
including issuing a program management policy; however, almost 7 years
after its creation, NNSA and DOE have not developed procedures that
govern how NNSA should function as a separately organized agency within
the department. Most notably, DOE and NNSA's counterintelligence
offices, whose missions were outlined in the original NNSA Act,
continually disagreed over the scope and direction of the
counterintelligence program. While DOE wanted to focus primarily on
investigating counterintelligence breaches after they occur, NNSA
sought to prevent intelligence leaks. Recent changes to the NNSA Act
are intended to address these conflicts by placing all
counterintelligence activities under the department.[Footnote 10] We
also identified the following four other management areas where
additional NNSA actions could improve its effectiveness in managing the
nuclear weapons complex:
* Human capital. NNSA has made progress in developing a human capital
strategy. However, DOE and NNSA have not conducted a systematic,
detailed analysis of how many staff NNSA needs in relation to DOE. As a
result, we identified areas where potential staff imbalances have
affected NNSA's ability to operate separately from DOE. For example,
NNSA's Office of General Counsel has 35 attorneys, including the
General Counsel, to provide NNSA legal analysis, while the rest of DOE
has 277 attorneys. According to NNSA's General Counsel, his office
would need 15 to 20 additional attorneys to fully handle NNSA's legal
workload with minimal assistance from DOE. Currently, NNSA relies on
DOE's Office of General Counsel to perform a significant portion of its
legal work.
* Project management. While both DOE and NNSA have initiated efforts to
improve project management, NNSA reported in November 2006 that about
16 percent of NNSA projects were at risk of breaching their cost
baseline, schedule baseline or both. We identified seven areas for
improvement that would foster a stronger culture for effective project
management. For example, while NNSA staff has proposed the development
of a new plan to further improve project management, NNSA management
indicated that it was not aware of this proposal; NNSA has not acted on
this proposal. Furthermore, DOE's Project Assessment and Reporting
System--a Web-based system for keeping DOE senior managers apprised of
the performance of projects costing more than $5 million--does not
include four major NNSA projects, estimated to cost over $100 million
each. Consequently, these projects do not receive the senior management
oversight that can be provided through that system.
* Program management. NNSA program managers are responsible for
completing a set of activities by employing a working knowledge of such
diverse areas as contracting, budgeting, and engineering. Recognizing
the important role of program managers, NNSA has taken several actions,
such as developing a program management policy. However, NNSA has yet
to identify all of its program managers or train them to a certified
level of competency. Indeed, DOE's most recent performance and
accountability report for fiscal year 2006 showed that NNSA fully met
only about 52 percent of its program goals while the rest of DOE
achieved about a 79-percent success rate.
* Financial management. NNSA has made significant progress in
implementing the planning, programming, budgeting, and evaluation
process (PPBE) over the last 4 years, as mandated by the NNSA Act.
However, several areas of improvement still have not been fully
addressed. For example, NNSA has issued policy letters on PPBE, but
some of these letters are still in draft form because, in part, NNSA is
waiting to obtain DOE's views on certain matters. In addition, NNSA's
PPBE mechanism for centralized resource allocation relies on collegial
decision making among senior NNSA managers, with the Administrator
resolving disputes and deciding on the final resource allocation.
However, the Administrator does not have an independent group to review
program proposals, confirm cost estimates, and analyze alternatives.
According to a 2003 DOE Inspector General report, most senior managers
believe that such an analytical group would be of value.[Footnote 11]
While NNSA has taken some action in this direction, it is not clear
when such a group will be established.
To improve the management of NNSA and its ability to oversee the
nuclear weapons complex, we are making a series of recommendations to
the Secretary of Energy and the Administrator, NNSA to, among other
things, (1) improve various aspects of NNSA's security oversight
program; (2) clearly define NNSA's status as a separately organized
agency within DOE; and (3) institute a series of NNSA initiatives to
improve project and program management, and the agency's planning,
programming, budgeting, and evaluation process.
We provided NNSA with a copy of this report for their review and
comment. NNSA generally agreed with the report and its corresponding
recommendations. NNSA noted that it considers the agency to be a
success but acknowledged that there was considerable work yet to be
accomplished. NNSA and DOE also provided technical comments, which we
have incorporated in this report as appropriate.
Background:
NNSA conducts its activities at research and development laboratories,
production plants, and other facilities (collectively referred to as
the nuclear weapons complex). Specifically, NNSA operates three
national laboratories that design nuclear weapons--Lawrence Livermore
National Laboratory, California; Los Alamos National Laboratory, New
Mexico; and the Sandia National Laboratories, New Mexico and
California; and four nuclear weapons production sites--the Pantex
Plant, Texas; the Y-12 National Security Complex, Tennessee; the Kansas
City Plant, Missouri; and parts of the Savannah River Site, South
Carolina; as well as the Nevada Test Site.
To implement its programs, NNSA received about $9.1 billion for fiscal
year 2006, including almost $6.4 billion for its nuclear weapons
activities, about $1.6 billion for its defense nuclear nonproliferation
programs, and about $782 million for the Naval Reactors program. NNSA's
appropriation also included about $766 million to provide security at
its sites. NNSA requested over $9.3 billion for fiscal year 2007,
including $6.4 billion for its nuclear weapons activities, $1.7 billion
for its defense nuclear nonproliferation programs, and $795 million for
the Naval Reactors program. According to NNSA's Future Years Nuclear
Security Program plan, between fiscal years 2007 and 2011, NNSA is
proposing to spend almost $48.5 billion on its nuclear weapons, nuclear
nonproliferation, and naval reactors programs.
For several years before NNSA was established, external studies found
problems with the organization and operation of what is now NNSA's
principal organization--DOE's Office of Defense Programs. These studies
cited continuing problems in the areas of overall management,
organization, priority setting, and maintenance of a viable
infrastructure and workforce. For example, the Institute for Defense
Analysis's March 1997 study, often called the "120-Day Study," cited
ambiguities and overlaps between the roles of headquarters and the
field as a primary source of inefficiencies and conflict.[Footnote 12]
Most influential in the creation of NNSA was the study conducted by a
Special Investigative Panel of the President's Foreign Intelligence
Advisory Board.[Footnote 13] Prepared in response to a series of
security problems, including public access to classified documents at
the Los Alamos National Laboratory, the Board found that DOE was a
dysfunctional bureaucracy incapable of reforming itself and that
reorganization was clearly warranted to resolve security and
counterintelligence problems. As noted earlier, the Board urged the
Congress to create a new organization that, whether established as an
independent agency or a semi-autonomous entity within DOE, should have
a clear mission, streamlined bureaucracy, and drastically simplified
lines of authority and accountability. To correct the problems
identified by the Board and others, in 1999, the Congress created the
NNSA.
For the last several years, we have monitored various high-risk areas
impacting NNSA operations and NNSA actions to implement the NNSA Act.
In January 2001, and again in January 2003, we identified strategic
human capital management as a governmentwide, high-risk area. We found
that the lack of attention to strategic human capital planning had
created a risk to the federal government's ability to perform its
missions economically, efficiently, and effectively.[Footnote 14] In
that context, we have stated that strategic workforce planning is
needed to address two critical needs: (1) aligning an organization's
human capital program with its current and emerging mission and
programmatic goals and (2) developing long-term strategies for
acquiring, developing, and retaining staff to achieve programmatic
goals.[Footnote 15]
In April 2001, we testified that NNSA's efforts to establish a new
organization looked promising.[Footnote 16] However, we highlighted the
need for NNSA to clearly define the roles and responsibilities of
headquarters and field staff and to establish clear lines of authority
between NNSA and its contractors, among other things. In May 2001, NNSA
announced plans to reorganize its headquarters operations. In December
2001, we noted that NNSA had set several important goals for its
overall reorganization efforts, including establishing clear and direct
lines of communication, clarifying the roles and responsibilities of
NNSA's headquarters and field offices, and integrating and balancing
priorities across NNSA's missions and infrastructure.[Footnote 17]
However, we found that NNSA's plans for the headquarters reorganization
did not contain a clear definition of the roles and responsibilities of
the headquarters organizational units.
In addition to reorganizing its headquarters, in February 2002, NNSA
proposed reorganizing its entire operation to solve important, long-
standing issues. Specifically, NNSA proposed a new organizational
structure that would (1) remove a layer of management by converting
existing operations offices to one support office, (2) locate NNSA
operational oversight close to laboratories and plants by strengthening
its site offices, and (3) streamline federal staff and hold federal
staff and contractors more accountable. In February 2002, we testified
that, with the proposed new organizational structure, resolution of
NNSA's long-standing organizational issues appeared to be within NNSA's
grasp.[Footnote 18] However, we noted that NNSA's lack of a long-term
strategic approach to ensuring a well-managed workforce precluded it
from identifying its current and future human capital needs, including
the size of the workforce; its deployment across the organization; and
the knowledge, skills, and capabilities needed to fulfill its mission.
In December 2002, the Administrator of NNSA implemented the proposed
reorganization.
Our May 2003 report on the management of NNSA's security program
identified similar concerns about NNSA's security organization and
management.[Footnote 19] Specifically, we found that NNSA (1) had not
fully defined clear roles and responsibilities for its headquarters and
site security operations and (2) had shortfalls at its site offices in
the total number of staff and in expertise, which could make it more
difficult for the site offices to effectively oversee security
activities. We therefore concluded that NNSA could not be assured that
its contractors were working to maximum advantage to protect critical
facilities and material from individuals seeking to inflict damage.
In June 2004, we found that NNSA's reorganization had addressed some
past problems by better delineating lines of authority and improving
communication. However, we also found that NNSA's reorganization had
not ensured that the agency had sufficient staff with the right skills
in the right places because it had downsized its federal workforce by
about 17 percent without first determining the critical skills and
capabilities needed to meet its mission and program goals.[Footnote 20]
Recently, in response to a July 2005 report by the Secretary of
Energy's Advisory Board's Nuclear Weapons Complex Infrastructure Task
Force on the nuclear weapons complex of the future, NNSA changed the
reporting relationship of the site office managers.[Footnote 21] To
facilitate the transformation of the nuclear weapons complex, the Task
Force recommended that the site office managers begin reporting to the
Deputy Administrator for Defense Programs instead of to the
Administrator. The Task Force believed that the Deputy Administrator
was the primary line manager with mission responsibility for the work
conducted at the sites and that this change would better align
responsibility and management of the program. In May 2006, the
Administrator made this change.
Additional Action Needed to Improve NNSA's Security Program:
Although NNSA has improved its headquarters oversight of security
across the nuclear weapons complex, NNSA continues to experience
difficulties in developing a safeguards and security program that
provides reasonable assurance that all protection objectives are being
met, especially at certain locations and in several topical areas, most
notably cyber security, according to our review of NNSA site office
surveys and independent inspections by DOE's Office of Independent
Oversight. We analyzed the results of the surveys and inspections
because NNSA and DOE security officials generally agreed that the
survey and inspection results represented the best available
information on the overall performance of NNSA's security program.
While the results of the surveys and inspections are not entirely
consistent, they do identify weaknesses with physical security at
several NNSA sites, including the Nevada Test Site, Los Alamos National
Laboratory, and the Y-12 National Security Complex, and weaknesses
throughout NNSA in the cyber security area. Over the last several
years, NNSA's security program has been hampered by several factors,
including (1) the lack of an effective headquarters organization, (2)
security staffing shortages at its site offices, (3) the lack of
adequate training resources and opportunities for its site office
security staff, and (4) the lack of metrics to gauge program
effectiveness.
NNSA Is Experiencing Difficulty in Meeting All Security Program
Objectives:
According to DOE Manual 470.4-1, Safeguards and Security Program
Planning and Management, NNSA must develop a safeguards and security
program that ensures NNSA has the necessary protections in place to
protect its security interests against malevolent acts, such as theft,
diversion, sabotage, modification, compromise, or unauthorized access
to nuclear weapons, nuclear weapons components, special nuclear
materials, or classified and unclassified information. NNSA's DNS is
responsible for developing the administration's security program.
To determine the overall effectiveness of NNSA's safeguards and
security program, NNSA and DOE principally rely on two types of
evaluations. Specifically, NNSA site offices conduct surveys of
contractors' performance while the Office of Independent Oversight
conducts periodic inspections, typically every 18 months. These
evaluations identify the strengths and weaknesses of NNSA's security
program and provide a basis for line management to decide on program
implementation activities, including allocating resources and
correcting security deficiencies.
Site Office Surveys. NNSA's site offices assess the extent to which day-
to-day security activities at its contractor-operated laboratories and
production facilities ensure that program objectives are met. According
to DOE's Safeguards and Security Program Planning and Management
manual, the frequency of these surveys varies from 12 months to 24
months, depending on the site's importance rating and type of materials
stored at that location. The site office surveys cover 8 topical areas
and 33 subtopical areas and are based on observations of performance,
including compliance with DOE and NNSA security directives. Table 1
shows the 8 topical and 33 subtopical safeguards and security areas
covered.
Table 1: Safeguards and Security Program Areas Covered in NNSA Surveys:
Safeguards and security program areas: Program management and support;
* Protection management program;
* Safeguards and security planning and procedures;
* Management control;
* Program-wide support;
Program definition: Establishes a standardized approach for protection
program planning that will provide an information baseline for use in
integrating departmental safeguards and security considerations,
facilitating management evaluation of program elements, determining
resources for needed improvements, and establishing cost-benefit bases
for analyses and comparison.
Safeguards and security program areas: Protective forces;
* Management;
* Training;
* Duties;
* Facilities and equipment;
Program definition: Protect security interests from terrorist or other
adversarial actions that could have major national security
consequences.
Safeguards and security program areas: Physical security;
* Access controls;
* Intrusion detection and assessment systems;
* Barriers and delay mechanisms;
* Testing and maintenance;
* Communications;
Program definition: Protect departmental assets from malevolent acts
such as theft, diversion, and sabotage events, such as civil disorder,
by considering site and regional threats, protection planning
strategies, and protection measures.
Safeguards and security program areas: Information protection;
* Basic requirements;
* Technical surveillance and countermeasures;
* Operations security;
* Classification guidance;
* Classified matter protection and control;
Program definition: Protect and control classified and controlled
sensitive matter that is generated, received, transmitted, used,
stored, reproduced, or destroyed.
Safeguards and security program areas: Cyber security;
* Classified cyber security;
* Telecommunications security;
* Unclassified cyber security;
Program definition: Protect automated information systems against
unauthorized access to or modification of information, whether in
storage, processing, or transit, against loss of accountability for
information and user actions, and against the denial of service to
authorized users, including those measures necessary to protect
against, detect, and counter such threats.
Safeguards and security program areas: Personnel security;
* Access authorizations;
* Human reliability program;
* Control of classified visits;
* Safeguards and security awareness;
Program definition: Ensure that granting an individual access to
classified matter, special nuclear material, or both would not endanger
the common defense and security and would be clearly consistent with
the national interest.
Safeguards and security program areas: Unclassified visits and
assignments by foreign nationals;
* Sponsor program management and administration;
* Counterintelligence requirements;
* Export controls/ technology transfer requirements;
* Security requirements;
* Approvals and reporting;
Program definition: Document and track visits and assignments by
foreign nationals to DOE sites or involving DOE information or
technologies.
Safeguards and security program areas: Control and accountability of
nuclear materials;
* Program administration;
* Material accountability;
* Materials control;
Program definition: Provide information on, control of, and assurance
of the presence of nuclear materials, including those systems necessary
to establish and track nuclear material inventories, control access to
and detect loss or diversion of nuclear material, and ensure the
integrity of those systems and measures.
Source: DOE orders and manuals.
[End of table]
The surveys assign the following color-coded performance ratings to
communicate the extent of performance and compliance with required
procedures and practices, as well as the impact of any deficiencies
along with other mitigating factors:
* Satisfactory (Green). The element being evaluated meets protection
objectives or provides reasonable assurance that protection objectives
are being met.
* Marginal (Yellow). The element being evaluated partially meets
protection objectives or provides questionable assurance that
protection objectives are met.
* Unsatisfactory (Red). The element being evaluated does not meet
protection objectives or does not provide adequate assurance that
protection objectives are being met.
Office of Independent Oversight Inspections. The Office of Independent
Oversight independently evaluates DOE sites, facilities, organizations,
and operations in the areas of safeguards and security, cyber security,
emergency management, and environment, safety, and health programs. The
Office of Independent Oversight inspects both federal and contractor
operations at a site and identifies findings, issues, and opportunities
for improvement. It also performs follow-up reviews to ensure
corrective actions are effective and that weaknesses in the safeguards
and security program are appropriately addressed. As shown in table 2,
the Office of Independent Oversight's inspections cover eight topical
and 36 subtopical safeguards and security areas.
Table 2: Safeguards and Security Program Areas in Office of Independent
Oversight Inspections:
Safeguards and security program areas: Protection program management;
* Planning process;
* Organization and staffing;
* Budget process;
* Program direction;
* Control systems;
* Survey program;
Program definition: Programs are designed to ensure that security
interests are provided an appropriate degree of protection from hostile
acts. It is an iterative process, whereby activities related to
planning, staffing, budget, direction, and feedback are integrated with
overall strategic and near-term operational planning.
Safeguards and security program areas: Physical security systems;
* Intrusion detection assessment;
* Entry and search controls;
* Badges, passes, and credentials;
* Barriers;
* Communications;
* Testing and maintenance;
Program definition: Programs are designed to use intrusion detection
and assessment, entry and search control, barriers, communications,
testing and maintenance, and supporting systems and interfaces to
deter, detect, annunciate, assess, delay, and communicate an
unauthorized activity.
Safeguards and security program areas: Protective forces;
* Management;
* Training;
* Equipment and facilities;
* Duties;
Program definition: Programs are designed to protect both DOE security
interests from theft, sabotage, and other hostile acts that may
adversely impact national security or the health and safety of the
public, as well as life and property at DOE facilities.
Safeguards and security program areas: Classified matter protection and
control;
* Program management;
* Control of secret and confidential documents;
* Control of top secret documents;
* Control of classified materials;
* Special programs;
* Operations security;
* Technical surveillance countermeasures;
* Classification management;
Program definition: Programs are designed to provide protection against
unauthorized disclosure of classified matter and for sensitive
information from its inception to destruction or decontrol.
Safeguards and security program areas: Material control and
accountability;
* Administration;
* Accounting;
* Measurements;
* Inventories;
* Containment;
Program definition: Programs are designed to provide an information and
control system for nuclear material. These programs encompass those
systems and measures necessary to establish and track nuclear material
inventories, control access, detect loss or diversion of nuclear
material, and ensure the integrity of those systems and measures.
Safeguards and security program areas: Personnel security;
* Management;
* Personnel clearance program;
* Security education program;
* Visitor control program;
* Human reliability program;
Program definition: Programs are designed to ensure that access to
sensitive information, classified matter, and special nuclear material
will be granted only after it has been determined that such access will
not endanger security and is consistent with the national interest.
Safeguards and security program areas: Cyber security--classified and
unclassified;
Program definition: Programs are designed to prevent deliberate or
inadvertent unauthorized disclosure, acquisition, manipulation,
modification, or loss of information contained within computer networks
and systems, as well as measures designed to prevent denial of
authorized use of the system.
Source: Office of Independent Oversight inspector's guides.
[End of table]
As shown in table 2, the Office of Independent Oversight examines areas
that are comparable to those that NNSA site offices assess through
their surveys. Similarly, the Office of Independent Oversight's rating
scale is comparable to the one NNSA site offices use. Specifically, the
Office of Independent Oversight may assign the following color-coded
ratings to overall programs, selected topical areas, or both:
* Effective performance (Green). The system inspected provides
reasonable assurance that the identified protection needs are met. That
is, (1) the protection meets all applicable standards, (2) the
protection did not meet all standards, but other systems or
compensatory measures provide equivalent protection, or (3) the failure
to fully meet a standard does not significantly degrade the protection.
Line managers are expected to effectively address any specific
deficiencies identified.
* Needs improvement (Yellow). The system inspected only partially meets
identified protection needs or provides questionable assurance that the
identified protection needs are met. That is, one or more applicable
standards are not met and are only partially compensated for by other
systems, and the resulting deficiencies degrade the effectiveness of
the inspected system. Line managers would be expected to significantly
increase their attention to the identified areas of weakness.
* Significant weakness (Red). The system inspected does not adequately
assure that identified protection needs are met. That is, one or more
applicable standards are not met, no compensating factors reduce the
impact on system effectiveness, and the deficiencies seriously degrade
the system's effectiveness. Line managers are expected to apply
immediate attention, focus, and resources to the deficient program
areas.
In addition to ratings, NNSA site office surveys and Office of
Independent Oversight inspection reports develop findings that identify
validated security deficiencies associated with a contractor's
safeguards and security program. In response to these findings, DOE
requires that contractors develop corrective actions to correct the
security deficiencies. These corrective actions include risk
assessment, root cause and cost-benefit analyses. To facilitate the
tracking of security findings and the development of corrective actions
by the responsible organization, DOE Manual 470.4-1 requires site
office and the Office of Independent Oversight staff to ensure that
findings are entered into the Safeguards and Security Information
Management System (SSIMS) --a centralized information management
system--in a timely manner.
NNSA Site Office Survey and Office of Independent Oversight Inspection
Results, While Not Entirely Consistent, Identify Several Problem Areas:
To evaluate the extent to which NNSA has addressed security issues at
its laboratories and plants, we reviewed and compared the results of
NNSA's site office surveys and DOE's Office of Independent Oversight
inspections for the 5-year period before the administration became
operational--fiscal years 1996 through 2000--and the 5-year period
after it became operational--fiscal years 2001 through 2005. While the
results of these surveys and inspections are not entirely consistent,
they do indicate that NNSA continues to experience difficulties in
implementing a safeguards and security program that provides reasonable
assurance that all protection objectives are being met, especially at
certain locations and in several topical areas, most notably cyber
security.
Initially, we totaled the ratings given to each topical area shown in
table 2 and determined the cumulative percent of ratings that resulted
in either a satisfactory, marginal, or unsatisfactory rating. With
respect to the site office surveys, the cumulative percentage of
topical areas that received a satisfactory rating declined slightly
between the two periods. Specifically, as shown in table 3, 86 percent
of the areas covered by the survey received a satisfactory rating for
the period before NNSA became operational, while 81 percent received a
satisfactory rating after NNSA was established.
Table 3: Site Office Survey and Office of Independent Oversight
Inspection Results of NNSA's Overall Security Performance, Fiscal Years
1996 through 2000, Compared with Fiscal Years 2001 through 2005:
Ratings: Satisfactory;
Fiscal years 1996 through 2000: Site office surveys: 86%;
Fiscal years 1996 through 2000: Office of Independent Oversight
inspections: 82%;
Fiscal years 2001 through 2005: Site office surveys: 81%;
Fiscal years 2001 through 2005: Office of Independent Oversight
inspections: 52%.
Ratings: Marginal;
Fiscal years 1996 through 2000: Site office surveys: 12%;
Fiscal years 1996 through 2000: Office of Independent Oversight
inspections: 16%;
Fiscal years 2001 through 2005: Site office surveys: 17%;
Fiscal years 2001 through 2005: Office of Independent Oversight
inspections: 39%.
Ratings: Unsatisfactory;
Fiscal years 1996 through 2000: Site office surveys: 2%;
Fiscal years 1996 through 2000: Office of Independent Oversight
inspections: 2%;
Fiscal years 2001 through 2005: Site office surveys: 2%;
Fiscal years 2001 through 2005: Office of Independent Oversight
inspections: 9%.
Ratings: Total number of assigned ratings;
Fiscal years 1996 through 2000: Site office surveys: 209;
Fiscal years 1996 through 2000: Office of Independent Oversight
inspections: 50;
Fiscal years 2001 through 2005: Site office surveys: 221;
Fiscal years 2001 through 2005: Office of Independent Oversight
inspections: 74.
Source: GAO analysis of NNSA site office survey and Office of
Independent Oversight inspection reports.
[End of table]
The results for our analysis of the overall Office of Independent
Oversight results showed a different picture. Specifically, while 82
percent of the areas covered by the Office of Independent Oversight
inspections received a satisfactory rating for the period before NNSA
became operational, only 52 percent received a satisfactory rating
after NNSA was established. Most notably, the percentage of areas
receiving a marginal rating increased from 16 percent for the period
1996 through 2000 to 39 percent for 2001 through 2005.
Because of (1) the importance of physical security in response to the
terrorist attacks of September 11, 2001, and (2) ongoing concerns about
the vulnerability of DOE computer systems to cyber security attacks,
and to identify where the differences were occurring between the NNSA
site office survey and the Office of Independent Oversight inspection
results, we analyzed the results for the physical security and cyber
security topical areas in the NNSA site office surveys and the Office
of Independent Oversight inspections for the 5-year period before the
administration became operational--fiscal years 1996 through 2000--and
the 5-year period after it became operational--fiscal years 2001
through 2005.[Footnote 22]
With respect to physical security, as shown in table 4, for the site
office surveys, the cumulative percentage of physical security topical
areas that received a satisfactory rating remained relatively unchanged
between the two periods for the seven sites we reviewed. In each
period, slightly more than 80 percent of the assessments resulted in a
satisfactory rating, even as physical security requirements have been
strengthened in response to the September 11, 2001 attacks.
Table 4: Site Office Survey and Office of Independent Oversight
Inspection Results of NNSA's Physical Security Performance, Fiscal
Years 1996 through 2000, Compared with Fiscal Years 2001 through 2005:
Ratings: Satisfactory;
Fiscal years 1996 through 2000: Site office surveys: 84%;
Fiscal years 1996 through 2000: Office of Independent Oversight
Inspections: 80%;
Fiscal years 2001 through 2005: Site office surveys: 82%;
Fiscal years 2001 through 2005: Office of Independent Oversight
inspections: 49%.
Ratings: Marginal;
Fiscal years 1996 through 2000: Site office surveys: 14%;
Fiscal years 1996 through 2000: Office of Independent Oversight
Inspections: 17%;
Fiscal years 2001 through 2005: Site office surveys: 15%;
Fiscal years 2001 through 2005: Office of Independent Oversight
inspections: 41%.
Ratings: Unsatisfactory;
Fiscal years 1996 through 2000: Site office surveys: 2%;
Fiscal years 1996 through 2000: Office of Independent Oversight
Inspections: 3%;
Fiscal years 2001 through 2005: Site office surveys: 3%;
Fiscal years 2001 through 2005: Office of Independent Oversight
inspections: 10%.
Ratings: Total number of assigned ratings;
Fiscal years 1996 through 2000: Site office surveys: 163;
Fiscal years 1996 through 2000: Office of Independent Oversight
Inspections: 36;
Fiscal years 2001 through 2005: Site office surveys: 168;
Fiscal years 2001 through 2005: Office of Independent Oversight
inspections: 59.
Source: GAO analysis of NNSA site office survey and Office of
Independent Oversight inspection reports.
[End of table]
While the site surveys showed relatively little change between the
periods reviewed, the Office of Independent Oversight's evaluation of
physical security showed a pronounced decline. Specifically, as shown
in table 4, while about 80 percent of the Office of Independent
Oversight's physical security assessments resulted in a satisfactory
rating for the period between fiscal years 1996 and 2000, only about 49
percent of the Office of Independent Oversight's physical security
ratings were satisfactory for the period of fiscal year 2001 through
2005.
Several factors contributed to the differences between the NNSA site
office ratings and the Office of Independent Oversight inspections for
physical security. First, while more site offices surveys were
performed in fiscal years 2001 through 2005 than the Office of
Independent Oversight inspections, proportionately more Office of
Independent Oversight ratings were marginal and unsatisfactory. In
particular, we found that at three sites--the Nevada Test Site; Sandia
National Laboratories, New Mexico; and the Y-12 National Security
Complex--over half of the Office of Independent Oversight ratings were
either marginal or unsatisfactory. In contrast, only the Y-12 National
Security Complex's site office surveys had more than 50 percent of the
ratings as marginal or unsatisfactory over the same period. Moreover,
the Office of Independent Oversight inspections had a higher percentage
of marginal and unsatisfactory ratings in the Physical Security
Systems, Classified Matter Protection and Control, and Materials
Control and Accountability topical areas than did the site office
surveys.
With respect to cyber security, both the site office surveys and the
Office of Independent Oversight inspections show declines.
Specifically, as shown in table 5, 92 percent of the cyber security
assessments in NNSA site office surveys resulted in a satisfactory
rating for both classified and unclassified cyber security before NNSA
was operational, but only 77 percent of the assessments resulted in a
satisfactory rating after NNSA became operational.
Table 5: Site Office Survey and Office of Independent Oversight
Inspection Results of NNSA's Cyber Security Performance, Fiscal Years
1996 through 2000, Compared with Fiscal Years 2001 through 2005:
Ratings: Satisfactory;
Fiscal years 1996 through 2000: Site office surveys: 92%;
Fiscal years 1996 through 2000: Office of Independent Oversight
inspections: 86%;
Fiscal years 2001 through 2005: Site office surveys: 77%;
Fiscal years 2001 through 2005: Office of Independent Oversight
inspections: 60%.
Ratings: Marginal;
Fiscal years 1996 through 2000: Site office surveys: 4%;
Fiscal years 1996 through 2000: Office of Independent Oversight
inspections: 14%;
Fiscal years 2001 through 2005: Site office surveys: 23%;
Fiscal years 2001 through 2005: Office of Independent Oversight
inspections: 33%.
Ratings: Unsatisfactory;
Fiscal years 1996 through 2000: Site office surveys: 4%;
Fiscal years 1996 through 2000: Office of Independent Oversight
inspections: 0%;
Fiscal years 2001 through 2005: Site office surveys: 0%;
Fiscal years 2001 through 2005: Office of Independent Oversight
inspections: 7%.
Ratings: Total number of assigned ratings;
Fiscal years 1996 through 2000: Site office surveys: 46;
Fiscal years 1996 through 2000: Office of Independent Oversight
inspections: 14;
Fiscal years 2001 through 2005: Site office surveys: 53;
Fiscal years 2001 through 2005: Office of Independent Oversight
inspections: 15.
Source: GAO analysis of NNSA site office survey and Office of
Independent Oversight inspection reports.
[End of table]
Similarly, Office of Independent Oversight inspection results also
indicated that cyber security performance had declined. Before NNSA
became operational, 86 percent of cyber security assessments resulted
in satisfactory ratings, compared with only 60 percent after NNSA
became operational.
With respect to the individual sites, the Office of Independent
Oversight inspections gave the most marginal or unsatisfactory ratings
for cyber security to four sites: Los Alamos National Laboratory;
Pantex; Sandia National Laboratories, New Mexico; and the Y-12 National
Security Complex. In contrast, the NNSA site office surveys assigned
marginal ratings to every NNSA site.
Concerns about cyber security were also raised in one of the two
independent analyses NNSA commissioned in July 2003 and by NNSA
officials with whom we spoke. Specifically, one analysis, NNSA
Security: An Independent Review, found that NNSA cyber security
policies, procedures and practices were less mature than their
counterparts in other security disciplines. Furthermore, the review
found that NNSA was "resource poor" and cyber security implementation
varied widely throughout NNSA because of inadequate funding,
insufficient cyber security personnel and expertise, and inadequate
collaboration between DOE and NNSA cyber security organizations.
According to current and former NNSA officials, and several site office
security directors, the cyber security program has received inadequate
attention and was poorly implemented because NNSA lacks a risk-based
approach to physical and cyber security. In this regard, in June 2006,
DOE officials revealed that a hacker had attacked an unclassified
computer system at NNSA's Service Center in Albuquerque, New Mexico,
and had gained access to a file containing the names and social
security numbers of over 1,500 NNSA employees.
More recently, in September 2006, DOE's Inspector General reported on
the weaknesses associated with the department's cyber security
programs, including NNSA's. According to the Inspector General, while
DOE has made progress in addressing some cyber-related problems,
ongoing problems continue to place DOE's critical information systems
and data at risk of compromise. The report cited weaknesses in the
following areas: systems inventory, certification, and accreditation;
contingency planning; access controls; and configuration management and
change controls. These problems occurred, in part, because program and
field offices did not always implement departmental and federal cyber
security requirements. For example, the Inspector General reported,
NNSA site officials stated that they were required to comply with NNSA
cyber security policy, rather than standards established by the
National Institute of Standards and Technology (NIST). However, the DOE
Inspector General also found that NNSA sites had not fully implemented
NNSA's cyber security policy and that many NNSA field sites were
permitted to follow a less thorough certification and accreditation
process that did not include all NIST or NNSA requirements.
Some of the differences between the site office survey and the Office
of Independent Oversight inspection results may be due to continued
differences in how each organization conducts its evaluations. We and
other oversight organizations have reviewed this issue over the last 6
years. For example, in February 2000, we reported that from 1994
through 1999, the Los Alamos National Laboratory and the Lawrence
Livermore National Laboratory received inconsistent oversight
ratings.[Footnote 23] During a given year, Los Alamos National
Laboratory received ratings ranging from marginal to excellent,
depending on the DOE organization conducting the assessment. Similarly,
the Lawrence Livermore National Laboratory received ratings ranging
from marginal to far exceeds expectations. We reported that this
inconsistency resulted, in part, from various organizations' use of
different criteria as well as the timing of the rating. Similarly, in
May 2000, DOE's Office of Inspector General reported on various factors
affecting the safeguards and security ratings and found that certain
security ratings were changed without a documented rationale.[Footnote
24]
More recently, in 2005, the Office of Independent Oversight issued a
report on the inconsistencies in safeguards and security
ratings.[Footnote 25] Specifically, the report noted that the Office of
Independent Oversight tended to identify significant safeguards and
security program deficiencies that the site office surveys did not
detect. Furthermore, the report identified several major weaknesses
commonly found in survey programs, including a lack of
comprehensiveness in conducting surveys; insufficient, or
insufficiently rigorous, performance testing; a reluctance to assign
formal findings when deficiencies were identified; and the lack of
sufficient detail to justify, or even to explain, the assigned ratings
in some survey reports.
Several Factors Have Contributed to Problems in NNSA's Safeguards and
Security Program:
Because many NNSA sites handle special nuclear material, including
nuclear weapons, plutonium, and highly enriched uranium, effective
federal oversight is critical to ensuring that the national security is
not harmed. While NNSA has recently improved its headquarters oversight
of security, it has been hampered over the last 7 years by several
factors, including (1) the lack of an effective headquarters
organization, (2) security staffing shortages at its site offices, (3)
lack of adequate training resources and opportunities for its site
office security staff, and (4) the lack of a complete security
information database and framework for evaluating security review
results.
NNSA Has Had Difficulty Developing an Effective Headquarters Security
Organization:
Under GAO's Standards for Internal Control in the Federal Government,
federal agencies must establish and maintain an effective system of
internal controls over their operations.[Footnote 26] Such a system is
the first line of defense in safeguarding assets and preventing and
detecting errors. Under our standards, managers should, among other
things, ensure that (1) the organizational structure clearly defines
key areas of authority and responsibility, (2) staff have the required
skills to meet organizational objectives, (3) progress can be
effectively measured, and (4) operations can be effectively monitored.
However, during much of its history, NNSA's security program has
experienced the following organizational issues:
* Initial organizational arrangements were not productive. The NNSA Act
established the position of Chief of DNS to advise the NNSA
Administrator on security-related matters and implement the security
policies directed by the Secretary and the Administrator. NNSA also
established the Nuclear Safeguards and Security Program (NSSP) within
NNSA's Facilities and Operations organization to provide assistance to
NNSA's site offices on such issues as implementing the Design Basis
Threat and developing budget requests for security.[Footnote 27]
However, the heads of the two offices had strained relations and often
disagreed on how to improve physical security at NNSA facilities. In
September 2002, the NSSP Director was replaced and his position
eventually terminated, and other NSSP staff either retired or left
NNSA. As a result, the effectiveness of the NSSP program was greatly
reduced and the field lost a source of guidance and leadership in NNSA
headquarters.
* Leadership turned over several times. NNSA's headquarters security
organization experienced considerable turnover in the position of Chief
of DNS and changes in the reporting level of that position within NNSA.
Specifically, four individuals have occupied that position since NNSA's
creation, often in an acting capacity. In addition, these Chiefs have
reported to different levels within NNSA. For example, the original
Chief reported directly to the Administrator of NNSA. However, when he
retired in 2003, his replacement occupied two positions--Chief of DNS
and Associate Administrator for Facilities and Operations--a practice
often referred to as "dual-hatting." When NNSA reorganized its
headquarters security organization in 2004, the Chief of DNS once again
reported directly to the Administrator. The second Administrator, who
resigned in January 2007, told us that he regretted having dual-hatted
the Chief of DNS position because it lowered the position's visibility
within NNSA. He believed that it was correct to elevate the current
Chief to serve as an Associate Administrator reporting directly to the
Administrator.[Footnote 28]
* Without effective leadership, important oversight activities were
ignored. The third Chief of DNS employed only a small staff and took
the position that virtually all headquarters oversight responsibility
rested with the Office of Independent Oversight. This approach was
strongly criticized in the April 2005 NNSA Security, An Independent
Review, which noted that the Office of Independent Oversight had
little, if any, direct responsibility, authority, and accountability
for day-to-day supervision of the NNSA complex and that the Office of
Independent Oversight's principal role was one of periodic independent
performance assessment.
To his credit, the current Associate Administrator for DNS has taken
numerous steps to build an effective headquarters security
organization. Specifically, he has:
* issued a program management plan to establish an integrated, NNSA-
wide, performance-based management approach for implementing work and
defining security performance expectations among DNS, NNSA site
offices, and their contractors to ensure full integration of security
requirements with the programmatic missions of NNSA;
* issued specific requirements for NNSA's Performance Assurance
Program, which provides a multi-tiered system of self-assessments and
other reviews of security performance and is aimed at assuring
comprehensive assessments of safeguards and security interests;
* improved interaction between NNSA headquarters and site office
security elements. For example, the Associate Administrator established
the Defense Nuclear Security Leadership Coalition, which comprises all
safeguards and security directors and meets regularly to address
security implementation challenges. He also conducts monthly
teleconferences with both federal and contractor security officials at
NNSA sites;
* established the Office of Security Oversight to assess safeguards and
security performance, serve as the point of contact for correcting
security deficiencies identified during surveys and independent
inspections, ensure the quality and consistency of federal oversight of
contractor activities, and identify areas for improvement throughout
the weapons complex; and:
* adopted a more proactive approach to security through stronger
accountability. For example, within the last 2 years, NNSA has replaced
three federal security directors at the Los Alamos, Nevada and Y-12
site offices.
NNSA Continues to Experience Security Staffing Shortfalls:
Having sufficient staff to oversee the security programs of its
contractors has been a persistent problem since NNSA's creation. For
example, in our May 2003 report on the management of NNSA's security
program, we found, among other things, that NNSA had shortfalls at its
site offices in the total number of security staff and in security
expertise, which may have made it more difficult for the site offices
to effectively oversee security activities. Given this situation, we
concluded that NNSA could not be assured that its contractors were
working to maximum advantage to protect critical facilities and
material from individuals seeking to inflict damage.[Footnote 29] We
raised a similar concern in our June 2004 report on NNSA's
reorganization. Specifically, we found that NNSA's reorganization had
not ensured that the agency had sufficient staff with the right skills
in the right places because it had downsized its federal workforce
without first determining the critical skills and capabilities needed
to meet its mission and program goals. For example, we noted that some
site offices, namely Pantex, Y-12, and Los Alamos, were having
difficulty filling critical skills in the safety and security
disciplines.[Footnote 30]
Complementing our work was an independent analysis commissioned by
NNSA. Specifically, in a March 2004 report, the "Chiles Commission"
identified a number of challenges that NNSA faces in recruiting,
training, and retaining enough skilled federal staff members to fill
the current and future security positions needed to effectively oversee
the security of its weapons complex.[Footnote 31] These challenges
included identifying the (1) number and skills mix of the security
staff, (2) near-term retirement eligibility of a significant percentage
of the security workforce, (3) lack of professional development and
training programs, and (4) lack of adequate resources. The commission
found that federal security personnel were managed on a site-specific
basis, noting that NNSA lacked a comprehensive human capital plan to
identify the areas of needed experience, ensure timely hiring, and
manage the skills mix of the federal security workforce across the
complex.
As part of this review, we assessed the continuing extent of security
staffing shortfalls at NNSA site offices. Specifically, we requested
information on the number of full-time equivalent (FTE) security
positions required to conduct effective oversight versus the actual
number of FTEs on board for fiscal years 2001 through 2005. As table 6
shows, three of the six site offices--the Los Alamos, Livermore and
Sandia Site Offices--did not report information on the required level
of staffing needed to effectively oversee contractors' security
performance for at least 3 of the 5 years for which we requested data.
According to site office security officials at these locations, they
could not find the records showing official staffing shortfalls.
Table 6: NNSA Site Office Security Staffing Shortages, Fiscal Years
2001 through 2005:
Site office: Los Alamos;
Fiscal year 2001: Required FTEs: [A];
Fiscal year 2001: Actual FTEs: 8;
Fiscal year 2002: Required FTEs: [A];
Fiscal year 2002: Actual FTEs: 4;
Fiscal year 2003: Required FTEs: [A];
Fiscal year 2003: Actual FTEs: 6;
Fiscal year 2004: Required FTEs: [A];
Fiscal year 2004: Actual FTEs: 8;
Fiscal year 2005: Required FTEs: 18;
Fiscal year 2005: Actual FTEs: 9.
Site office: Livermore;
Fiscal year 2001: Required FTEs: [A];
Fiscal year 2001: Actual FTEs: 27;
Fiscal year 2002: Required FTEs: [A];
Fiscal year 2002: Actual FTEs: 27;
Fiscal year 2003: Required FTEs: [A];
Fiscal year 2003: Actual FTEs: 26;
Fiscal year 2004: Required FTEs: 20;
Fiscal year 2004: Actual FTEs: 18;
Fiscal year 2005: Required FTEs: 20;
Fiscal year 2005: Actual FTEs: 19.
Site office: Nevada;
Fiscal year 2001: Required FTEs: 25;
Fiscal year 2001: Actual FTEs: 23;
Fiscal year 2002: Required FTEs: 25;
Fiscal year 2002: Actual FTEs: 20;
Fiscal year 2003: Required FTEs: 23;
Fiscal year 2003: Actual FTEs: 15;
Fiscal year 2004: Required FTEs: 20;
Fiscal year 2004: Actual FTEs: 13;
Fiscal year 2005: Required FTEs: 21;
Fiscal year 2005: Actual FTEs: 14.
Site office: Pantex;
Fiscal year 2001: Required FTEs: 8;
Fiscal year 2001: Actual FTEs: 7;
Fiscal year 2002: Required FTEs: 8;
Fiscal year 2002: Actual FTEs: 7;
Fiscal year 2003: Required FTEs: 8;
Fiscal year 2003: Actual FTEs: 7;
Fiscal year 2004: Required FTEs: 8;
Fiscal year 2004: Actual FTEs: 7;
Fiscal year 2005: Required FTEs: 8;
Fiscal year 2005: Actual FTEs: 8.
Site office: Sandia;
Fiscal year 2001: Required FTEs: [A];
Fiscal year 2001: Actual FTEs: 7;
Fiscal year 2002: Required FTEs: [A];
Fiscal year 2002: Actual FTEs: 7;
Fiscal year 2003: Required FTEs: [A];
Fiscal year 2003: Actual FTEs: 9;
Fiscal year 2004: Required FTEs: [A];
Fiscal year 2004: Actual FTEs: 10;
Fiscal year 2005: Required FTEs: [A];
Fiscal year 2005: Actual FTEs: 11.
Site office: Y-12;
Fiscal year 2001: Required FTEs: 11;
Fiscal year 2001: Actual FTEs: 6;
Fiscal year 2002: Required FTEs: 11;
Fiscal year 2002: Actual FTEs: 10;
Fiscal year 2003: Required FTEs: 10;
Fiscal year 2003: Actual FTEs: 12;
Fiscal year 2004: Required FTEs: 11.5;
Fiscal year 2004: Actual FTEs: 11;
Fiscal year 2005: Required FTEs: 14;
Fiscal year 2005: Actual FTEs: 13.
Source: Analysis of NNSA site office staffing data.
[A] Required FTE numbers were unknown at these sites.
[End of table]
According to NNSA's data, five of the six site offices have experienced
security staffing shortfalls during at least one fiscal year. For
example, since fiscal year 2001, the Nevada Site Office has been
increasingly understaffed, and in fiscal year 2005, the Los Alamos Site
Office had half of the required staff it needed to conduct oversight.
Consequently, according to site office security officials, most site
offices have only one staff member responsible for a safeguards and
security topical area and do not have additional staff on board to fill
in if necessary. Site offices have compensated in various ways. For
example, the Los Alamos Site Office has recently obtained detailees
from other site office elements to assist in conducting oversight.
According to one Safeguards and Security Director, security personnel
have to work excessive overtime to complete assigned tasks. Finally,
because it does not have a dedicated survey team, the Nevada Site
Office has had to request survey assistance from other site offices to
conduct surveys. According to a former NNSA official involved in the
administration's initial organization, NNSA did not tailor security
staffing numbers to actual needs and could have better planned its
allocation of staff to site offices during the reorganization.
To address the lack of security staff, NNSA has taken two actions.
First, it has implemented the Defense Nuclear Security Intern Program.
This program, which was established in 2004 and is administered by the
Pacific Northwest National Laboratory, is designed to attract and train
individuals to fill critical NNSA security positions and support the
development of a qualified, experienced pool of security professionals
to supplement site office staffing. Participants are assigned to a
specific NNSA site for 12 to 15 months. Successful interns may have an
opportunity for permanent placement as federal employees within NNSA's
safeguards and security program if they successfully complete the
program. To date, four participants have done so, with three of the
four converted to permanent positions at the Pantex, Y-12, and Nevada
site offices. According to site office officials, the most significant
challenge associated with successfully implementing the intern program
is obtaining clearances in a timely manner.
Second, in April 2005, NNSA held a staffing summit to determine site
offices' needs. Headquarters and site offices provided their end-of-
year staffing levels, the number of additional FTE staff needed to meet
critical needs based on available resources, and an estimate of the
optimal FTE levels. Based on available resources, NNSA site offices
were granted authority for six FTE security staff. However, according
to site office officials, site offices remain understaffed for
security.
Training for Security Staff Can be Improved:
NNSA has not implemented an appropriate training program to meet the
needs of its security personnel. As a result, the number of security
staff with adequate training and the right skills continues to be a
problem. According to our Standards for Internal Control in the Federal
Government, managers should ensure that their personnel possess and
maintain a level of competence needed to accomplish their assigned
duties. Specifically, skill needs must be continually assessed, and
training should be aimed at developing and retaining the skills needed
to achieve changing organizational goals. In addition, DOE requires
that critical training needs for federal staff are identified and met
and that a systematic mechanism for providing training be established.
Training needs are both organizationally and individually driven. Site
offices are required to identify performance gaps for newly hired
employees and specialized training for subsequent years and are
responsible for ensuring that training requirements are met. For their
part, employees are required to develop an individual development plan
and discuss their training needs with their supervisors, who are
responsible for authorizing all training.
In March 2004, the Chiles Commission reported that NNSA's federal
security workforce was forgoing needed training because of the press of
urgent business and a shortage of resources. The Commission found that
over 50 percent of NNSA personnel surveyed believed that the existing
training and education of the federal security workforce was not
adequate. In addition, the Commission reported that staffing plans did
not have the built-in flexibility needed to allow for professional
development and training. NNSA officials told us that problems
associated with site office workloads resulted from the 2002
reorganization where all oversight responsibilities formerly at the
operations offices were transferred to the newly formed site offices
without sufficient allocation of staff. In addition, site office
security directors told us training budgets do not address the needs of
their staff. For example, according to NNSA officials, the Los Alamos
Site Office did not receive training dollars for fiscal year 2006, and
the Nevada Site Office received only a minimal training budget for its
security staff. According to a human resource official at the NNSA
Service Center, there is an "enormous disconnect" between training
needs and budgets, noting that training needs are not addressed
systematically. To address this issue, Safeguards and Security
directors at each site office have recently developed site-specific
technical qualifications programs for their staffs. While these efforts
are important, we found no NNSA-wide formal training program that
provides NNSA federal security officials with the skills needed to
conduct effective oversight.
NNSA Lacks Security Metrics to Gauge the Effectiveness of Its
Safeguards and Security Program and Has Not Effectively Communicated
Lessons Learned to Guide Security Improvements:
NNSA does not have comprehensive metrics regarding the overall
effectiveness of its safeguards and security program and is not
communicating lessons-learned to guide security improvements across the
complex. According to our Standards for Internal Control, for an agency
to run and control its operations, it must have relevant, accurate
information that is recorded and communicated to management in a form
and within a time frame that enables managers to carry out their
operational responsibilities. According to NNSA officials, NNSA has not
developed a framework for evaluating the results of independent and
internal security reviews. NNSA officials told us that while they
believe that security across the weapons complex has improved, NNSA
does not have good metrics to support the assertion that security has
improved. DNS is currently working to develop performance metrics that
will allow NNSA to track processes and make decisions about its
safeguards and security program, but NNSA does not plan to develop an
overall indicator of its security status to assist in efforts to gauge
program effectiveness.
In addition, NNSA does not have complete data for tracking security
deficiencies identified by security oversight reviews. According to
NNSA security officials, not all security deficiencies have been
entered into SSIMS because (1) the database is very difficult to use,
(2) connections to it are slow because of the lack of high-speed
encrypted modems, and (3) it often crashes once a connection is
established. Therefore, some site office officials questioned SSIMS's
usefulness as a management tool and suggested that it be replaced. As a
result, most site offices have begun to use their own tracking systems,
or those developed by contractors, to track identified security
deficiencies. For example, the Los Alamos National Laboratory uses
REDBOOK, a custom-designed classified system operating on an ACCESS
platform to internally track the status of security deficiencies and
associated corrective action plans. Previously, Los Alamos had read-
only access to SSIMS, but lost its connection after the 2004 stand-down
of operations because of missing computer disks. Similarly, during the
summer of 2004, the Y-12 Site Office developed PEGASUS--an interactive
tracking system that is tailored to the site office's oversight efforts
and links all oversight-related correspondence. According to Y-12 site
office officials, the system informs site office security staff
electronically about their daily oversight tasks, reduces the amount of
paperwork associated with resolving security deficiencies, and allows
the security director to track whether federal security personnel are
performing their oversight duties. In addition, PEGASUS, which is
updated weekly, has the ability to automatically identify recurring
security deficiencies and provides better quality data than SSIMS.
According to one security contractor official, the difficulty
associated with logging onto SSIMS results in security deficiencies
being reported 6 to 12 months after they are resolved.
In commenting on our report, officials in the Office of Health, Safety,
and Security indicated that NNSA sites offices have not reported to the
SSIMS helpdesk any logon problems that would result in a 6-to 12-month
reporting delay. In addition, the officials said that (1) a
significantly high percentage of the officials who have taken SSIMS
training have indicated that SSIMS is one of the best, if not the best,
computer database experiences they have had, (2) since July 2004, SSIMS
has offered high speed encrypted connectivity to all NNSA sites, and
(3) NNSA sites would not lose their SSIMS connection if the sites
installed and used this high speed encrypted connectivity. The Director
of the Office of Security Technology and Assistance in the Office of
Health, Safety, and Security agreed that the SSIMS database was not
complete and therefore not useful for providing oversight; however, he
felt the problem was with how the NNSA site offices were using the
database.
Finally, NNSA has not implemented a formal process for sharing best
practices or lessons learned to guide security improvements across the
weapons complex. According to site office security officials, lessons
learned have been informally shared in some instances, including
monthly meetings with NNSA safeguards and security directors,
teleconferences with contractor security officials, and the review of
results from the Office of Independent Oversight inspections conducted
at other sites. According to the Associate Administrator, he has taken
the initiative to informally communicate lessons learned throughout the
complex, but these lessons have yet to be fully implemented. For
example, as early as February 2005, the DOE Inspector General
identified problems with the retrieval of badges from terminated
employees at the Los Alamos National Laboratory.[Footnote 32] After the
report was issued, the Associate Administrator sent the findings to
NNSA site offices and requested that they review their respective
processes. Nevertheless, the DOE Inspector General identified similar
problems at other NNSA sites in subsequent reviews of their respective
badge retrieval processes.[Footnote 33]
While best practices and lessons learned have been communicated
informally, it is important that NNSA sites have a formal means for
communicating these lessons. Absent updated information in SSIMS, or a
sufficient connection to it, it is difficult to determine whether
proven corrective actions for security deficiencies identified have
been implemented across the complex. Utilizing the existing SSIMS
capability to identify how other sites address security deficiencies
would significantly help alleviate redundancy of effort in addressing
similar problems identified throughout the weapons complex.
Several Management Issues Need to be Resolved for NNSA to Become Fully
Effective:
NNSA and DOE have not yet addressed all of the problems that need
attention to improve the management of the nation's nuclear programs.
Problems continue, in part, because NNSA and DOE have not yet fully
agreed on how NNSA should function within the department. In addition
to addressing this underlying issue, NNSA could strengthen its ability
to manage the nuclear weapons complex if it took additional action in
four other areas: (1) human capital, (2) project management, (3)
program management, and (4) financial management.
DOE and NNSA Have Not Yet Fully Determined How NNSA Should Operate as a
Separately Organized Agency within DOE:
NNSA has focused considerable attention on reorganizing its internal
operations, but it and DOE continue to struggle with establishing how
NNSA should operate as a separately organized agency within the
department. Several factors have contributed to this situation. First,
DOE and NNSA did not have a useful model to follow for establishing a
separately organized agency in DOE. Second, the January 2000
implementation plan, required by the NNSA Act, did not define how NNSA
would operate as a separately organized agency within DOE. As a result,
although some NNSA programs have set up procedures for interacting with
DOE, other programs have not, resulting in organizational conflict.
Even where formal procedures have been developed, interpersonal
disagreements have hindered effective cooperation. In this environment,
concerns about NNSA's organizational status persist, with a January
2006 report by the Defense Science Board calling for the creation of a
new, independent National Nuclear Weapons Agency. However, former
senior DOE and NNSA officials with whom we spoke generally did not
favor removing NNSA from DOE.
Other Federal Agencies Did Not Provide a Useful Model for How a
Separately Organized Agency Should Be Structured:
In its June 1999 report recommending the establishment of NNSA, the
President's Foreign Intelligence Advisory Board suggested that the NNSA
could be constructed in one of two ways: (1) by remaining an element of
DOE, but becoming semi-autonomous, that is, separately organized within
the department, or (2) by becoming completely independent, with its
administrator reporting directly to the President. The Board cited
several models for either course of action. If the first approach were
chosen, the Board identified as potential models the National Security
Agency, the Defense Advanced Research Projects Agency within the
Department of Defense (DOD), and the National Oceanic and Atmospheric
Administration within the Department of Commerce. If an independent
agency approach were chosen, the Board cited the National Aeronautics
and Space Administration and the National Science Foundation as
potential models.
To determine if the agencies the Board cited could have provided useful
models for how NNSA should be established as a separately organized
agency within DOE, we met with officials from the Defense Advanced
Research Projects Agency and the National Oceanic and Atmospheric
Administration, as well as with officials from the Defense Threat
Reduction Agency in DOD and the Federal Aviation Administration in the
Department of Transportation. None of the officials associated with
these four agencies considered their agency to be separately organized
or believed that their agency's operational methods were transferable
to NNSA. Officials of the respective agencies told us the following:
* Defense Advanced Research Projects Agency: The organization is not a
separately organized agency but simply a part of DOD. The agency's
internal operational staff is kept to a minimum, with considerable
reliance on the department for many activities. For example, the
Defense Finance and Accounting Service provides support for the
agency's financial operations.
* National Oceanic and Atmospheric Administration. The Administration
is considered a bureau within the Department of Commerce with no higher
status than any other departmental bureau. In operational areas such as
budget or personnel, both the Administration and the Department of
Commerce have comparable offices, but it is understood that the
Administration office is subordinate, with the Department of Commerce
office having final decision-making authority.
* Defense Threat Reduction Agency. The agency is part of DOD. For all
operational activities, guidance comes from DOD headquarters, and the
agency is expected to follow the normal military chain of command.
* Federal Aviation Administration. The Administration is an operating
administration under the Department of Transportation. It has no higher
status than any other departmental administration, such as the Federal
Highway Administration or the Federal Railroad Administration. In
operational areas, such as the chief information officer, chief
financial officer, and general counsel, the Administration receives
direction from the cognizant departmental office. However, the Federal
Aviation Administration does have separate authority for human
resources and procurement.
Former and current senior DOE and NNSA officials also told us they had
difficulty identifying any federal role model for a separately
organized agency. Absent such a role model, these officials said, NNSA
was created using their best judgment about how a separately organized
agency should be established.
DOE and NNSA Have Not Systematically Developed Standard Operating
Procedures to Define Their Relationship:
GAO's standards require federal agencies to establish and maintain an
effective system of internal controls over agency operations.[Footnote
34] We have noted that internal controls are particularly important for
managing risk during organizational change, and we have emphasized one
control--an agency's organizational structure--that we believe should
clearly define key areas of authority and responsibility.
Section 3297 of the NNSA Act required DOE to submit a plan implementing
the act's provisions to the relevant congressional committees.[Footnote
35] However, DOE's January 1, 2000, implementation plan did little to
define NNSA's status as a separately organized agency. Reflecting the
opposition of the then DOE senior leadership to the creation of NNSA,
the implementation plan dual-hatted virtually every significant
statutory position in NNSA with DOE officials, including the Director
of NNSA's Office of Defense Nuclear Counterintelligence and General
Counsel. As we testified in April 2001, this practice caused
considerable concern about NNSA's ability to function with the
independence envisioned in the NNSA Act.[Footnote 36] In its October
2000 report on the establishment of NNSA, the Special Oversight Panel
on Department of Energy Reorganization noted that the Secretary, facing
criticism for having impeded NNSA's autonomy, retreated from the dual-
hatting philosophy and appointed separate individuals to NNSA offices.
Dual-hatting was subsequently forbidden by an amendment to the NNSA
Act.[Footnote 37]
In a July 2000 hearing before the Special Oversight Panel, the incoming
NNSA Administrator testified that establishing NNSA as a semi-
autonomous entity would require developing a single, interconnected set
of policies and principles that permeated the entire NNSA and minimized
outside inputs. Nevertheless, DOE and NNSA have not systematically
developed standard operating procedures to define their relationship.
Consequently, although some NNSA programs have set up specific policies
and procedures for how they will interact with their DOE counterparts,
other programs have not. Without formal procedures, several functions-
-budgeting, procurement, information technology, management and
administration, and safeguards and security--have not been effectively
or efficiently implemented, as the following points detail.[Footnote
38]
* Budgeting. DOE and NNSA do not have a formal order defining how DOE's
and NNSA's budgeting requirements would be combined into a practicable
process. As a result, according to NNSA officials, NNSA has had to
follow both DOE's and NNSA's budgeting processes.
* Procurement. Although DOE made a commitment to issuing NNSA-specific
acquisition procedures in its January 2000 implementation plan for
NNSA, it has not done so. According to DOE Office of General Counsel
officials, the department subsequently determined that the proposed
NNSA-specific procedures were inconsistent with Federal Acquisition
Regulations, the NNSA Act, and the January 2000 implementation plan.
According to both DOE and NNSA officials, since 2004 the Department has
blocked NNSA's efforts to issue its own acquisition regulations. As a
result, according to NNSA officials, NNSA has had to issue a series of
deviations to the DOE acquisition regulations to carry out NNSA
acquisition policies in areas such as negotiating a more effective
contract fee arrangement and awarding additional years to a contract's
term.[Footnote 39]
* Information technology. The DOE and NNSA offices of the Chief
Information Officer have yet to reach agreement on a DOE order drafted
in September 2004 to define the relationship between the two offices.
According to DOE and NNSA officials, the draft order has not been made
final because of DOE's concern that the NNSA office would have too
great a role in tasks that should be performed by DOE's chief
information officer. Absent this order, certain problems have
developed. For example, according to a NNSA official, the two
information offices verbally agreed that all direction given to NNSA
contractors about information technology must come from NNSA, not DOE.
However, because this guidance was not formally documented, NNSA
contractors continue to receive dual requests for data from both the
DOE and NNSA offices of the Chief Information Officer. According to an
NNSA official, these dual requests have continually forced the
contractors to rank the requests.
* Management and administration. DOE and NNSA do not have a formal
process for obtaining DOE approval of NNSA-specific procedures,
although the Congress authorized the Administrator to establish NNSA-
specific policies unless disapproved by the Secretary of
Energy.[Footnote 40] However, DOE's Office of General Counsel has
delayed the development of this process because it believes that NNSA
should not be treated any differently than any other departmental
element and should thus be limited to using the flexibility already
available in DOE orders. As a result, NNSA's efforts to promulgate
Administration-specific procedures have become entangled in a
cumbersome review process with no certainty that closure of that review
will occur, according to NNSA officials. NNSA officials cited instances
in which the Administration has attempted to promulgate NNSA-specific
procurement regulations and policies on the roles of the DOE and NNSA
Offices of the Chief Information Officer. In these instances, the
review bogged down because a formal process for establishing NNSA-
specific procedures did not exist.
* Safeguards and security. DOE and NNSA have not established formal
procedures outlining the relative safeguards and security
responsibilities of the DOE and NNSA offices that oversee contractor
security activities. As a result, security officials at contractor
facilities told us they have received safeguards and security oversight
from a number of sources, including DOE; DNS; and the NNSA site offices
that oversee the contractor facilities. Furthermore, the oversight they
receive from these various sources can conflict. For example, DNS
requires contractors to demagnetize electronic media before disposing
of it. However, DOE Manual 470.4-4 requires physical destruction of
electronic media through pulverization or other appropriate methods.
Uncertain about which requirement to follow, the Sandia National
Laboratories requested, and was subsequently granted by the NNSA Sandia
site office manager, an exemption to DOE's physical destruction
requirement. However, the Office of Independent Oversight reported that
Sandia National Laboratories, the NNSA Sandia site office, and DNS had
not fully evaluated the risks associated with following alternative
destruction procedures. Sandia National Laboratories now follows the
DOE requirement.
While the lack of formal procedures has adversely affected some
functions, the presence of formal procedures has not always ensured
that the roles and responsibilities of DOE and NNSA offices are clearly
defined and that the offices operate together effectively and
efficiently. Specifically, the original NNSA Act prescribed roles and
responsibilities for DOE's Office of Counterintelligence and NNSA's
Office of Defense Nuclear Counterintelligence. Under section 3204 of
the NNSA Act, the director of DOE's Office of Counterintelligence was
responsible for establishing policy for counterintelligence programs
and activities at departmental facilities. At the same time, section
3232 of the NNSA Act specified that NNSA's Chief of Defense Nuclear
Counterintelligence was responsible for developing and implementing the
Administration's counterintelligence programs.
To better define the relationship between the two counterintelligence
offices, DOE issued a Secretarial Policy Memorandum in January 2001 and
a DOE order in December 2004. The Secretarial memorandum, in part,
directed that the DOE headquarters counterintelligence program offices
would be a shared resource between the DOE Office of
Counterintelligence and the NNSA Office of Defense Nuclear
Counterintelligence but that the funding needed for those program
offices would come from DOE's Office of Counterintelligence budget. The
December 2004 DOE order contained similar provisions but specified that
the headquarters inspections and polygraph programs would be directed
solely by the Director of DOE's Office of Counterintelligence.
According to DOE and NNSA counterintelligence officials, the
organizational relationship created by the Secretarial memorandum and
the DOE order led to the following problems:
* DOE and NNSA counterintelligence officials have disagreed over the
scope and direction of the counterintelligence program. NNSA
counterintelligence officials would like NNSA's counterintelligence
program to emphasize a multifaceted and proactive approach to prevent
intelligence activity. This program would integrate all of the tools of
the shared counterintelligence program offices--Analysis; Operations
and Investigations; Plans, Policy, Training and Awareness; and
Information and Special Technologies--as well as the DOE-directed
Polygraphs and Inspections program office. However, DOE's Office of
Counterintelligence emphasized a reactive approach to
counterintelligence--one that primarily focused on investigating
counterintelligence incidents that have already occurred. NNSA
counterintelligence officials stated that they would have liked to have
changed the scope and direction of the NNSA counterintelligence
program. However, such changes require the concurrence of DOE's Office
of Counterintelligence, according to NNSA counterintelligence
officials, which did not occur.
* DOE and NNSA counterintelligence officials also disagreed over their
ability to jointly direct the staff in the headquarters
counterintelligence program offices. Funding for these offices was
included in DOE's counterintelligence budget, and DOE's Office of
Counterintelligence senior management provided the program office
directors with their performance rating, with advisory input from the
NNSA counterintelligence office. Consequently, NNSA counterintelligence
officials believed that NNSA had less leverage in assigning tasks to
the program office staff, while DOE counterintelligence officials
believed that the DOE and NNSA counterintelligence offices had equal
leverage.
* DOE and NNSA counterintelligence officials disagreed over the
allocation of counterintelligence resources. The NNSA Chief for Defense
Nuclear Counterintelligence believed that counterintelligence resources
should be allocated according to risk management and priority-setting
principles. She noted that the risk associated with NNSA nuclear
weapons facilities was generally higher than the risk associated with
other DOE facilities because the loss of nuclear weapons information or
materials to foreign intelligence would constitute a serious breach of
national security. Therefore, in an August 2005 memorandum, the NNSA
chief asked the Director of DOE's Office of Counterintelligence to
comprehensively evaluate whether resources could be redirected to
benefit higher-risk counterintelligence targets and to provide guidance
for future decision making about resource allocation. As of November
2006, the DOE director had not responded to the NNSA memorandum.
* DOE and NNSA counterintelligence officials disagreed over
counterintelligence policymaking. For example, from September 2004 to
August 2005, the NNSA counterintelligence office unsuccessfully
attempted to obtain the DOE counterintelligence office's concurrence on
issuing a joint DOE/NNSA policy on personnel security file reviews and
sharing of counterintelligence information. When the DOE
counterintelligence office did not respond, the NNSA
counterintelligence office issued a NNSA-specific policy on August 12,
2005. This issuance without DOE's concurrence sparked a series of
verbal and e-mail exchanges between DOE and NNSA counterintelligence
officials, according to NNSA officials. DOE counterintelligence
officials stated in the e-mails we reviewed that NNSA did not have the
authority to issue NNSA-specific counterintelligence policy without DOE
concurrence. As such, the DOE counterintelligence office initially
demanded that the NNSA office retract the policy. Subsequently, in
April 2006, the DOE counterintelligence office issued a memorandum that
embraced the NNSA policy.
* DOE and NNSA counterintelligence officials disagreed over, or were
confused about, their roles and responsibilities in handling specific
counterintelligence matters. A case in point was the department's
handling of the well-publicized mid-2005 intrusion into an unclassified
NNSA computer system and removal of the names and social security
numbers of 1,502 individuals working for NNSA. The 1,502 NNSA
individuals were not notified of this incident until June 2006, after
the incident was acknowledged during a congressional hearing held
earlier in the month. Subsequently, the Secretary of Energy requested
that the Office of Inspector General examine the department's response
to this incident. In its July 2006 report, the Inspector General
identified multiple factors that contributed to the lack of a timely
response to this incident, including the delay in notifying the 1,502
NNSA individuals that certain personal information had been
compromised. The Inspector General recommended that the department
redefine and clarify the roles and responsibilities of DOE and NNSA
counterintelligence officials.
DOE and NNSA counterintelligence officials told us that they spent an
enormous amount of time resolving these types of problems between the
two offices and that this effort detracted from their focus on
counterintelligence activities. According to NNSA counterintelligence
officials, the arrangement did not meet the intent of the NNSA Act to
create a separately organized counterintelligence program within NNSA.
As a result, these officials added, NNSA's ability to execute a
separate counterintelligence program that meets its unique needs was
impeded and largely limited to what the two counterintelligence offices
could agree on.
Subsequently, the Congress amended the NNSA Act to address the problems
with the NNSA's and DOE's counterintelligence programs. Specifically,
section 3117 of the John Warner National Defense Authorization Act for
Fiscal Year 2007 contained provisions to consolidate the
counterintelligence programs of DOE and NNSA under the Department of
Energy.[Footnote 41] Section 3117 also established the Intelligence
Executive Committee within the Department of Energy, consisting of the
Deputy Secretary of Energy, who would chair the committee, and each
Under Secretary of Energy. The section requires the Secretary of Energy
to use the committee to assist in developing and promulgating the
counterintelligence and intelligence policies, requirements, and
priorities of the entire Department. The section also established
within the staff of the Administrator, NNSA, a position of NNSA
Intelligence and Counterintelligence Liaison who would be responsible
for liaison between the NNSA and the Department's Office of
Intelligence and Counterintelligence. The amendment sunsets on
September 30, 2010, and the NNSA functions, personnel, funds, assets,
and other resources transferred to the Secretary of Energy will be
returned to the control of the Administrator, NNSA.
The conference report stated that the Congress reluctantly provided
this authority to consolidate the program despite the ongoing
skepticism of many in the Congress over the Department's ability to
implement a strong security program for the Department and its
laboratories.[Footnote 42] The conference report noted that with the
recent Departmental initiative to combine the Offices of Intelligence
and Counterintelligence and with the authority provided in this
provision, the intelligence and counterintelligence functions would be
organized as they were when the Department experienced significant
counterintelligence problems. The conference report stated that the
conferees believed that the Department could have addressed many of the
perceived issues associated with having separate counterintelligence
offices for the Department and NNSA by demonstrating greater management
resourcefulness. The report also stated that the conferees were
unpersuaded that the Department fully and faithfully implemented the
counterintelligence program structure called for in the NNSA Act.
Nevertheless, the conference report noted that the Department had
continued--under the leadership of two different Secretaries of Energy
and two different Deputy Secretaries--to identify the
counterintelligence structure of the NNSA Act as an impediment to the
smooth functioning of security operations within DOE. Therefore, the
conferees agreed to include a provision that would provide temporary
authority for the disestablishment of the Office of Defense Nuclear
Counterintelligence within NNSA and the transfer of NNSA
counterintelligence personnel to the Department's Office of
Counterintelligence. DOE officials told us that they are in the process
of developing plans to implement the consolidation of the
counterintelligence programs and expect full implementation in early
2007. According to these officials, the consolidation should be a
seamless process and will provide the leadership necessary to
effectively implement DOE's counterintelligence activities.
External Entities Continue to Express Concern about NNSA's
Organizational Relationship:
Almost 7 years after NNSA was created, concerns persist about the
organization and management of the nuclear weapons complex that led to
NNSA's establishment. For example, in January 2006, DOD's Defense
Science Board Task Force on Nuclear Capabilities reviewed alternative
institutional arrangements that it believed could provide for more
efficient management of the nuclear enterprise. The task force
expressed concern that other elements of DOE were continuing to
micromanage NNSA. To correct this situation, the task force proposed
the following three options:
* Reform the existing structure. The task force would accomplish this
reform by having the Secretary of Energy enforce the requirement that
the Administrator be autonomous and accountable only to the Secretary.
The task force believed that this approach would require a significant
change in DOE culture, but it had little confidence in the prospect for
effective, lasting change within DOE.
* Move NNSA to DOD. The task force believed that there was more
confluence between DOD's core missions and the nuclear weapons complex.
However, the task force noted that, historically, the Congress has been
reluctant to concentrate nuclear weapons authority in a single
department and that, on balance, DOD was not a good fit for the
development and production of nuclear weapons.
* Create a National Nuclear Weapons Agency. The task force supported
this option, believing that the nuclear weapons enterprise was unique
in its missions and the demands placed upon managers and that a unique
organizational approach was therefore warranted. The National Nuclear
Weapons Agency would report through a Board of Directors, comprising
the Secretaries of several cabinet offices, including Energy and
Defense, to the President.
However, former senior DOE and NNSA officials, as well as, one Defense
official with whom we spoke, generally did not favor removing NNSA from
DOE. These officials included the first and second Administrators of
NNSA, the former Deputy Secretary of DOE, and a senior member of the
Defense Science Board Task Force responsible for the January 2006
report. These officials offered the following comments on NNSA's
organization:
* According to the second NNSA Administrator, it would not be a good
idea to make NNSA a totally independent agency. The Administrator
indicated that NNSA is very much entangled in the operations of DOE and
the costs associated with making NNSA totally independent from DOE
would outweigh the benefits.
* One former senior official told us he never knew what it meant to
have NNSA as a separately organized agency. In this official's view,
because DOE and NNSA had not clearly defined the concept, there was
some uncertainty in the relationship between the DOE Secretary and the
Administrator of NNSA. While this official would not be in favor of
establishing NNSA as a totally separate agency, he believes that NNSA
needs to take a half-step away from DOE to gain more independence.
* According to another former senior official, the DOE/NNSA
organizational relationship might have benefited from a more formal
definition. Regarding organizational changes, in this official's view,
the Congress should either make NNSA a totally independent agency or
fold it back into DOE.
* NNSA is not a separately organized agency, a Defense Science Board
Task Force official told us. In this official's view, DOE ensured that
fate by deciding, in its 2000 implementation plan, that certain
functions would not be transferred to NNSA. When NNSA was created, this
official said, the Congress was clear in the enabling legislation about
the type of entity it wanted NNSA to be. However, the Congress has
allowed the problems associated with DOE's implementation to languish.
NNSA Needs to Fully Resolve Its Human Capital Issues:
Under GAO's internal control standards, agencies should ensure that
they have a sufficient number of staff, particularly in managerial
positions, and that staff have the skills required to carry out the
agency's organizational objectives. While NNSA has engaged in a variety
of human capital activities since its creation, DOE and NNSA have yet
to fully determine the appropriate size of their respective workforces.
In its January 2000 NNSA Implementation Plan, DOE outlined a series of
steps it would take to staff NNSA. In order to be prepared when the
NNSA Act took effect on March 1, 2000, DOE indicated that current
employees assigned to those program offices that would become part of
NNSA would be transferred to NNSA. For other employees, such as those
in departmental support offices, DOE stated that a more detailed
analysis would be necessary to determine those employees subject to
transfer.
In February 2002 testimony before the Special Oversight Panel on
Department of Energy Reorganization of the House Armed Services
Committee, the then Administrator stated that NNSA was taking a "phased
approach" to assess the status of each NNSA function and the costs and
benefits of continued reliance on DOE for service. For example, in the
area of human resources, the former Administrator stated that NNSA had
decided to develop an independent capability to select, promote, and
develop its own executive workforce. In other areas, such as the
investigation of serious accidents, NNSA would continue to rely on DOE
personnel. However, DOE and NNSA have never conducted a systematic,
detailed analysis of NNSA's staffing needs in relation to DOE's.
During this review, we identified areas where potential staff
imbalances have affected NNSA's ability to operate as a separately
organized agency within DOE. These imbalances occur even though NNSA's
federal staff deals with about 40 percent of DOE's budget and programs,
according to a June 2006 DOE analysis. The imbalance is most notable in
NNSA's Office of General Counsel. Section 3217 of the NNSA Act
established the position of the NNSA General Counsel to serve as NNSA's
chief legal officer. Initially, DOE assigned the DOE General Counsel to
also serve as the NNSA General Counsel. This dual-hatting was
subsequently prohibited by an amendment to the NNSA Act.[Footnote 43]
NNSA has since hired a General Counsel and 34 other attorneys to
provide NNSA with legal advice and analysis. In contrast, the rest of
DOE has 277 attorneys. According to NNSA's General Counsel, who has
been at NNSA since September 2001, no formal analysis of his office's
staffing needs has ever been done. However, he believes that such an
analysis would show that his office needs about 15 to 20 additional
attorneys to fully handle NNSA's legal workload with minimal assistance
from DOE. Absent additional attorneys, NNSA must rely on DOE's Office
of General Counsel to perform a significant portion of its legal work.
The June 2006 DOE analysis also showed a large difference between the
size of the NNSA federal staff compared with the rest of DOE federal
staff in other areas. NNSA concurred with this analysis. (See table 7.)
Table 7: Staffing Levels within NNSA and DOE Offices:
Function: Public Affairs;
NNSA staffing: 16;
DOE staffing: 74.
Function: Congressional Affairs;
NNSA staffing: 5;
DOE staffing: 23.
Function: Security;
NNSA staffing: 131;
DOE staffing: 181.
Function: Planning, Programming, Budgeting, and Evaluation;
NNSA staffing: 124;
DOE staffing: 555.
Function: Information Technology;
NNSA staffing: 50;
DOE staffing: 522.
Source: DOE Office of Human Capital Management.
[End of table]
According to the first Administrator, because of the difference in
staff size, DOE can control NNSA's agenda by deciding which issues will
get reviewed and when. In his view, this problem began when NNSA was
created and has only gotten worse. He also stated that because NNSA did
not have a plan for how it would fully staff its headquarters
organization, he tried to hire the people he needed one at a time. An
April 2005 NNSA report on its security program raised similar
concerns,[Footnote 44] noting that the disparity in size between NNSA
and DOE headquarters staffs greatly impaired NNSA's effectiveness
within the headquarters bureaucracy. For example, the report said, DOE
dominated the development of security policy because its staff was
significantly larger. In addition, a May 2005 NNSA staffing analysis
noted that the far larger DOE staff are able to devote considerable
effort to "second-guessing" NNSA actions or to excessive requests for
data and that other DOE staff sometimes seek to interfere with NNSA.
Reconciling any disparity between the size of the NNSA and DOE staffs,
and determining the staff NNSA needs to carry out its overall mission,
should take place within the context of a broader, data-driven
workforce plan. In December 2001, we reported that NNSA did not have
the coherent human capital and workforce planning strategies it needed
to develop and maintain a well-managed workforce over the long run. We
therefore recommended that, before NNSA allocated any additional
excepted service positions, it develop a thorough human capital and
workforce planning strategy.[Footnote 45] In June 2004, we reported
that while the workforce plan NNSA developed in December 2003 attempted
to establish a framework for long-term workforce planning, the plan was
of limited use because it did not have current statistics on workforce,
positions, and organizational structures.[Footnote 46] Furthermore, the
downsizing NNSA was completing at the time was taking place in an
unstructured environment. Under these conditions, agencies can
experience significant challenges in deploying people with the right
skills, in the right places, and at the right time, and in ensuring
that they perform their missions economically, efficiently, and
effectively. In NNSA's case, we noted at the time that there were early
indications that the lack of planning was contributing to skill
imbalances such as those imbalances in security staff already
discussed. We further stated that without a functional long-term
workforce plan, NNSA ran the risk of facing more serious staff
shortages or skill imbalances in the future, which would affect its
ability to adequately oversee its contractors and ensure the safety and
security of its various facilities.
To its credit, NNSA has recognized that it needs to improve its human
capital management, and in a November 28, 2005, memorandum to NNSA
senior managers, the Administrator announced a workforce planning
initiative. The Administrator acknowledged that NNSA had no systematic
way to assess current, or forecast future, human capital needs.
Consequently, he asked the NNSA Office of Human Resources to develop
and refine a workload analysis and planning approach. While the
Administrator expected that this approach would be usable by the middle
of fiscal year 2006, according to the Director for NNSA's Office of
Human Resources, he made certain changes to the workload analysis to
ensure that more appropriate data could be collected. As a result of
those changes, the Director said, the workload analysis and planning
approach would take longer to complete.
NNSA Can Take Additional Action to Improve Project Management:
Project management remains a significant concern for NNSA and DOE and,
over the last several years, both have initiated improvement efforts.
For example, NNSA has implemented earned value management systems to
improve project reporting, conducted independent project reviews to
diagnose problem areas before the projects are executed, and, in April
2006, completed training and certifying its project managers. In July
2006, DOE issued a new program and project management order.
Nevertheless, DOE's fiscal year 2006 performance and accountability
report still identified project management as a significant issue.
Furthermore, according to NNSA's November 2006 report on project
management performance, 5 of 31 NNSA projects, or about 16 percent, are
in jeopardy of breaching their cost baseline, schedule baseline or
both. To further improve NNSA's project management performance, we
identified seven areas for additional action.
* Develop a project management policy. Any improvement requires a
policy that clearly articulates management's vision. While NNSA has
been involved in drafting a revised DOE order on project management,
and creating and promulgating DOE project management guides, in an
April 2003 memorandum, the NNSA Administrator committed to issuing an
NNSA-specific project management policy to (1) further assist in the
implementation of the DOE project management manual issued in March
2003 and (2) assure consistent application with the NNSA Act. However,
according to an official in NNSA's Office of Project Management and
Systems Support--which would be responsible for developing a project
management policy--no NNSA project management policy has been issued.
* Prepare a project management improvement plan. Short-and long-range
plans are critical to implementing a project management policy.
However, NNSA developed its last project management improvement plan in
December 2000. According to information presented at NNSA's 2005
Project Management Training Workshop, the Administration successfully
accomplished many of the eight goals in this plan, including using
qualified, experienced project managers to oversee NNSA projects and
establishing formal procedures for obtaining senior manager review and
approval of projects. However, the NNSA staff presenter at the workshop
also noted that NNSA was not completely successful in creating a
cultural shift in NNSA that emphasizes the importance of project
management or creating incentives to improve project managers'
performance. As a result, NNSA has not significantly reduced project
delivery times or costs. The NNSA staff presenter, therefore, proposed
the development of new short-and long-range improvement plans, which
officials from NNSA's Office of Project Management and Systems Support
acknowledged the Administration currently does not have. While these
officials acknowledged the need for such plans, NNSA management
indicated that it was not aware of the staff proposal.
* Prepare project management annual reports. After its creation, NNSA
began preparing an annual status report to the Congress on its
construction project accomplishments. However, it submitted only two
reports--for fiscal years 2000 and 2001. In fiscal year 2000, NNSA
reported, among other things, that about 70 percent of its Defense
Programs' 46 projects were progressing satisfactorily and that Defense
Programs had many success stories during the year, including (1)
reestablishing the quarterly project review process, (2) developing and
implementing a project management improvement plan, and (3) sponsoring
a project management workshop. However, NNSA also reported that the
root causes of project management problems were deeply entrenched and
could not be eliminated without a basic cultural change, which would
require at least 3 years. In fiscal year 2001, NNSA reported that 30,
or about 73 percent, of its 41 projects were progressing satisfactorily
and noted accomplishments in project management. However, NNSA also
reported that (1) management costs for projects were nearly double
those of other organizations and (2) projects took approximately 3
years longer to accomplish than similar projects performed elsewhere.
The Director of NNSA's Office of Project Management and Systems
Support--who assumed his position in 2004--did not know why the reports
were discontinued. Other NNSA officials in the Office of Project
Management and Systems Support told us that the reports were
discontinued because statements, such as those contained in the fiscal
year 2001 report, cast NNSA in too unfavorable a light.
* Include major projects in the Project Assessment and Reporting System
(PARS). In 2001, DOE implemented PARS--a Web-based system for keeping
DOE senior managers apprised about the performance of projects costing
more than $5 million. In response to a February 2004 memorandum from
the Deputy Secretary of Energy citing inadequate management of critical
activities within DOE and NNSA, NNSA indicated that it intended to
treat more of its activities as projects so that the cost and schedule
performance associated with those activities could be improved. While
NNSA has applied project management principles to more of its
activities, we identified four major NNSA projects--estimated to cost
over $100 million each--that are not enrolled in the PARS system and do
not receive senior management oversight through that system (See table
8.) NNSA indicated that these projects are not in PARS because they are
information technology projects or programmatic efforts. However, we
believe each listing in table 8 meets DOE's definition of a project
because it has a defined start and end date. In addition, information
technology projects are not prohibited from inclusion in PARS.
Table 8: Major Projects Not Included in PARS:
Project name: B-61 Life Extension;
Description: NNSA expects this project, designed to extend the service
life of the B-61 bomb, to cost about $287 million between fiscal years
2005 and 2009.[A].
Project name: W-76 Life Extension;
Description: NNSA expects this project, designed to extend the service
life of the W-76 nuclear warhead by replacing components, to cost about
$1.05 billion between fiscal years 2005 and 2011.
Project name: Enterprise Project;
Description: NNSA increased the total cost of this project, which will
replace the accounting and management systems at Los Alamos National
Laboratory, from about $70 million when it was initiated in 2001 to
nearly $160 million.
Project name: Purple and BlueGene/L Supercomputers under the Advanced
Simulation and Computing Program;
Description: NNSA expects this project to cost about $290 million.
Source: GAO analysis of DOE information.
Note: The W-80 Life Extension was also not included as a project in
PARS; however, NNSA recently announced that this effort was being
terminated.
[A] The cost for the B-61 and W-76 life extension projects is contained
in NNSA's fiscal year 2007 budget.
[End of table]
We are particularly concerned that the life extension projects were not
included in the PARS database. In our July 2003 report on NNSA's life
extension program, we recommended that NNSA establish the individual
life extensions as projects and manage them according to DOE's project
management requirements.[Footnote 47] As we reported, the then NNSA
Deputy Assistant Administrator for Military Application and Stockpile
Operations acknowledged that the three life extensions were projects,
and NNSA concurred with our recommendations. During our current review,
however, we could not find any evidence that NNSA had taken any action
to establish the life extensions as projects.
* Complete a lessons learned report database. DOE's project management
manual states that a lessons learned report should be completed,
distributed, and included in a project's permanent file; however, the
manual does not require the establishment of a comprehensive lessons
learned project management database. To its credit, the Administration
has attempted to create such a database on one of its internal Web
pages, but we found that certain key NNSA lessons learned reports were
not included, including, for example, reports for NNSA's Accelerated
Strategic Computing Initiative and W-87 Life Extension. We believe that
these reports provided information worthy of dissemination across the
NNSA complex. For example, the W-87 lessons learned report noted that
the project plan was prepared too late in the development cycle and was
not used as a tool to identify problems and take corrective actions. In
addition, the Accelerated Strategic Computing Initiative report noted
that the Lawrence Livermore and Los Alamos National Laboratories had
mixed success, in part, because they did not look at the lessons
learned from other communities. While officials in the Office of
Project Management and Systems Support acknowledged that the Web page
was incomplete, they said the forthcoming DOE project management order
would reinforce the importance of lessons learned information. However,
the final order, issued in July 2006, did not discuss a lessons learned
database; instead, it required that a lessons learned report be
prepared and submitted to DOE's Office of Engineering and Construction
Management for broader sharing among the DOE project management
community. According to that office, it has yet to develop internal
procedures for sharing this information.
* Develop contractor performance benchmarks. Benchmarking is an
integral part of project management.[Footnote 48] It is used to analyze
the gap between actual and preferred performance in order to identify
opportunities for improvement. We found that while NNSA tracks cost and
schedule performance on individual projects through various reporting
systems, including information contained in the PARS system, neither
the PARS system nor any other departmental system ranks the collective
project management performance of NNSA's contractors. On its own
initiative, however, the Los Alamos National Laboratory contracted in
2004 to have its project management performance benchmarked against
comparable organizations. The August 2004 report found that, on a scale
of 1 to 5, with 1 as the lowest, Los Alamos' project management rated a
2. Los Alamos had project management processes, although such processes
were not considered an organizational standard on all projects.
According to NNSA site office managers we contacted, it would be
helpful to know how their contractor ranked in project management
performance against other NNSA contractors. The Sandia Site Office
Manager added that this ranking, as well as an NNSA national average,
would help determine if project management at her laboratory was doing
well or not. Overall, the managers added, if their contractor's project
management performance was not at a comparable level to other
contractors, they could identify problems and develop solutions.
* Require contractors to receive project manager training. DOE and NNSA
have initiated a program to train and certify all departmental project
managers on projects costing $5 million or more. However, because
departmental projects are usually undertaken by an outside contractor,
the training of the contractor's project manager is equally important.
Several studies conducted at the request of either DOE, NNSA or their
contractors have recommended training and certifying contractors'
project managers. For example, in 1999, the National Research Council
found that the lack of project management skills was a fundamental
cause of poor project performance and recommended that DOE require all
contractors' project managers to be experienced, trained, and qualified
in project management appropriate to the project.[Footnote 49]
Similarly, in 2004, the Civil Engineering Research Foundation reported
that project management competence was a critical factor in project
success and recommended that formal project management training of
contractor project managers be made a contract requirement.[Footnote
50] Despite this support for contractor project manager training and
certification, neither DOE nor NNSA has a policy on contractor project
manager training. According to an NNSA official, the Administration has
taken the position that it will stipulate in its contracts what it
wants accomplished and then leave it up to the contractor to determine
how best to achieve NNSA's requirements.
NNSA Can Also Improve Program Management Through Additional Action:
Program managers are responsible for accomplishing an organized set of
activities directed toward a common purpose or goal. To fulfill that
responsibility, NNSA program managers are expected to have a working
knowledge of such diverse areas as contracting, budgeting, and
engineering. Recognizing the importance of program managers, NNSA has
taken several actions, such as initiating a project and program
management improvement team and developing a program management policy.
However, DOE's performance and accountability reports indicate that
additional improvements in program management are possible. For
example, according to DOE's fiscal year 2006 performance and
accountability report, NNSA fully met only about 52 percent of its
program goals, compared with about 79 percent for the rest of DOE.
Similarly, according to departmental information, NNSA met about 74
percent of its performance targets from fiscal years 2002 through 2006,
compared with 87 percent for the rest of DOE. To further improve its
program management performance, NNSA will need to take the following
actions:
* Prepare status reports on program management improvement. In any
performance-based management system, once a problem has been
identified, a corrective action plan is prepared and reports are
generated to periodically evaluate the status of the corrective action.
In a July 2004 memorandum to the DOE Under Secretary, NNSA indicated
that each NNSA office would prepare a corrective action plan, known as
a program management implementation plan. While all NNSA offices
completed at least a portion of these implementation plans, only the
offices of Defense Programs, Nuclear Nonproliferation, and Defense
Nuclear Security outlined specific tasks, or deliverables, in their
plans that needed to be completed. More importantly, of these offices,
only Defense Programs and Nuclear Nonproliferation identified a due
date for each task. Plans prepared by the offices of Emergency
Operations, and Infrastructure and Environment did not include any
specific tasks or due dates. Moreover, none of the NNSA offices have
prepared periodic reports on the status of their efforts to improve
program management. Therefore, it is unclear how much progress each
NNSA office has made.
* Complete a best practices guide on program management. In response to
the Government Performance and Results Act, agencies have learned that
they can improve performance by emulating the best practices of leading
organizations. In October 2003, an internal review of NNSA's program
management found that, among other things, NNSA needed to have (1) a
common language and terminology about program management, (2)
consistency in program manager functions and qualifications, and (3) a
clear channel of direction and consistent and timely flow of
information from NNSA programs to contractors.[Footnote 51] It
recommended that NNSA develop and issue a best practices guide by
December 1, 2003. The draft guide was never issued in final form and
disseminated within NNSA.[Footnote 52] According to a NNSA official and
a NNSA contractor official who served on the program management team,
the best practices guide floundered after NNSA made certain
organizational and employee changes and the guide no longer had a
person serving as a champion of program management improvement.
* Identify and train program managers. NNSA's August 2004 program
management policy largely superseded earlier NNSA team recommendations
on program manager training.[Footnote 53] According to the August 2004
policy, NNSA's Office of Management and Administration was responsible
for developing and maintaining a database of NNSA program managers to
identify (1) the manager for each program, (2) the training and
certification requirements for each program manager position, (3) the
dates the program manager initially completed various training and
certifications, and (4) when, if applicable, the training and
certification must be renewed. The policy did not stipulate any
deadline for the database's completion. Consequently, according to an
official in NNSA's Office of Management and Administration, this
program manager database has not been created. In contrast, according
to an official in DOE's Office of Engineering and Construction
Management, the department has developed a training curriculum for DOE
program managers with approval of that curriculum by the DOE Deputy
Secretary expected in the next few months. Unlike the NNSA program
management policy, DOE will not initially require that program managers
be certified on the amount of training received.
Certain Financial Management Weaknesses Remain Despite NNSA
Improvements:
Under section 3252 of the NNSA Act, NNSA had to develop a planning,
programming, and budgeting process that comported with sound financial
and fiscal management principles.[Footnote 54] The NNSA Act also
requires NNSA to annually submit to the Congress a Future Years Nuclear
Security Program plan that details NNSA's planned expenditures for the
next 5 years.[Footnote 55] Very early in his tenure, the first NNSA
Administrator indicated that he intended to comply with the NNSA Act by
instituting a planning, programming and budgeting process similar to
DOD's. While DOD's approach has not been without its problems over the
past 40 years, it is generally recognized as a system that, when
properly led and staffed, can provide cost-effectiveness comparisons
and develop the detailed program and budget plans called for in the
NNSA Act. Although NNSA has made significant progress in implementing
its PPBE process over the last 4 years, it still needs to (1) complete
its PPBE policy guidance, (2) establish an independent analysis unit to
assist the Administrator in making budget allocation decisions, (3)
develop criteria for compiling an NNSA-wide priorities list, (4)
develop an up-to-date schedule of those programs requiring budget
validation, and (5) establish a DOE-compliant budget validation
process.
* Complete NNSA's PPBE policy. As recognized in Office of Management
and Budget (OMB) Circular A-123, an important part of internal controls
over financial reporting is having policies and procedures in place to
ensure that management directives are carried out and that management's
assertions in its financial reporting are valid. To this end, NNSA has
issued 10 policy letters providing guidance to NNSA staff on various
aspects of the PPBE process: 6 of these 10 letters are final, 3 have
been in draft for more than 1 year, and 1 has been in draft for more
than 2 years. According to the director of NNSA's Office of Planning,
Programming, Budgeting, and Evaluation, the four draft policy letters
have not been made final, in part, because NNSA has been waiting to see
DOE's position on issues in the draft letters. However, we believe that
waiting 2 years for DOE's views is inconsistent with NNSA's operation
as a separately organized agency with its own PPBE budgeting process.
NNSA indicated that it is continuing to evaluate aspects of the PPBE
budgeting process and expects to finalize at least three of the draft
policy letters during fiscal year 2007.
* Establish an independent analysis unit. PPBE provides a mechanism for
centralized resource allocation decisions. In NNSA, that mechanism
consists of having senior NNSA managers develop a budget for their
program and then collegially review, through a management council, the
budgets from the other programs, including the programs' justification
for additional resources to meet requirements they cannot fund within
their target allocation. The council can either decide to shift funding
between programs to meet such requirements or determine whether the
issue should be presented to the Administrator for resolution. The
Administrator reviews the council's decisions, resolves issues
identified by the council, and makes final resource allocation
decisions. Such a mechanism places considerable pressure on the
Administrator alone to make difficult funding decisions.
While the NNSA PPBE process was modeled after the process DOD uses, it
differs markedly in one aspect. Unlike DOD, NNSA has not established an
independent group responsible for reviewing program proposals,
verifying cost estimates, and analyzing alternatives. In August 2003,
DOE's Office of Inspector General reported that most NNSA senior
managers interviewed believed such an analytical group could be of
value.[Footnote 56] For example, the then NNSA Acting Associate
Administrator for Management and Administration said that he supported
the formation of such a group to provide objective analyses to the
Administrator when he had to move resources between programs. Several
senior managers also stated that resource allocation decisions among
program offices were likely to become more frequent in future years
and, therefore, NNSA's need for independent analytical services was
likely to grow. Although NNSA agreed with the Inspector General's
recommendation regarding the need for an independent analytical support
group, it did not believe that such a group could be created before the
end of calendar year 2005, after downsizing and reorganization had been
completed.
NNSA indicated that its management is fully supportive of the
importance of independent analysis at both the NNSA and DOE level, but
mindful that the resources needed to create this capability must be
balanced with all of the competing needs within NNSA in a highly
constrained funding and staffing environment. However, in our view, in
such an environment, the need for an independent budget analysis unit
to ensure that appropriate budgetary decisions are made becomes even
more important.
* Develop criteria for compiling an NNSA-wide priorities list. In order
to make trade-off decisions among organizations and programs within an
organization, DOE formally requires each of its organizations to
annually submit a report to its Office of Budget that ranks its
programs for the budget year and provides a rationale for the ranking.
As we noted in July 2003, NNSA did not submit these ranking reports for
fiscal years 2002 through 2004.[Footnote 57] It submitted a list for
the first time for the fiscal year 2007 budget, after the Secretary of
Energy specifically requested it. According to an NNSA budget official,
each NNSA program, such as Defense Programs and Nuclear
Nonproliferation, prepared its list individually. Afterwards, this
official stated, the NNSA Administrator compiled an overall priority
list without using any formal criteria.
According to an official in DOE's Office of Budget, his office had some
questions about the ranking of activities on the NNSA list. For
example, the impact associated with not funding a particular activity
was not always sufficiently clear to explain NNSA's ranking rationale.
While NNSA subsequently answered all of the Office of Budget's
questions satisfactorily, he noted that NNSA might have benefited from
preparing and following some formal criteria for developing its
priority ranking list, as do other DOE organizations, such as the
Office of Environmental Management. Formal criteria, in this official's
view, would consider the impact of not funding an activity plus the
probability of success if additional funding occurred.
NNSA indicated that it annually issues strategic planning guidance and
program and fiscal guidance, holds internal NNSA office programming
sessions, and convenes a senior NNSA leadership meeting to discuss the
various NNSA office proposals. NNSA added that, considering all these
actions and balancing competing priorities, the Administrator makes his
decisions which are documented in the Administrator's Final
Recommendations report. In our view, having formalized criteria to
follow would assist the Administrator in making his decisions and
render those decisions more transparent and defensible to outside
review.
* Develop an up-to-date schedule of those programs requiring budget
validation. Under the PPBE process, once NNSA establishes the relative
priority of its programs, the budget associated with those programs
must be developed and validated. During validation, NNSA evaluates the
need for the program's proposed activities and the cost estimates in
support of those activities. In a May 2004 memorandum, NNSA's Office of
Management and Administration announced the Administration's 5-year
schedule for conducting budget validations for fiscal years 2005
through 2009. NNSA indicated that it would select programs for
validation on the basis of several factors, including programs
receiving OMB Performance Assessment Rating Tool reviews, program
manager requests, Administrator direction, significant external
interest, and high program visibility. Using those factors, for fiscal
year 2006, NNSA planned to validate the budgets for the Office of the
Administrator, Science Campaign, Readiness Campaign, Safeguards and
Security, International Nuclear Materials Protection and Cooperation,
Elimination of Weapons-Grade Plutonium Production, and Naval Reactors
Operations and Maintenance, and for the fiscal year 2007 budget, it
would validate Directed Stockpile Work/Stockpile Services, Nuclear
Weapons Incident Response, Nonproliferation and Verification research
and development, and Highly-Enriched Uranium Transparency
Implementation.[Footnote 58]
While NNSA followed the May 2004 schedule for fiscal years 2006 and
2007, it had not updated this schedule as of November 2006 to reflect
program changes. For example, new major program initiatives--such as
the Reliable Replacement Warhead and the efforts to transform the
nuclear weapons complex, called Responsive Infrastructure--are not
listed on the May 2004 validation schedule for fiscal years 2005
through 2009. While the amounts requested in the fiscal year 2007
budget for these two initiatives are low compared with other program
efforts, both initiatives are considered centerpieces in the NNSA
budget, will require significant additional funding in succeeding
fiscal years, and meet NNSA's selection criteria for program validation
on the basis of significant external interest and high program
visibility. Because the May 2004 schedule has not been updated, NNSA
does not know when certain programs like the Reliable Replacement
Warhead and Responsive Infrastructure would be validated, according to
an official in NNSA's Office of Planning, Programming, Budgeting, and
Evaluation. This official added that NNSA is contemplating updating the
program validation schedule later in 2006.
NNSA indicated that it would not be beneficial to add the Reliable
Replacement Warhead and Responsive Infrastructure programs to its
budget validation schedule until DOE and the Office of Management and
Budget have made decisions to proceed with these activities. However,
both of these programs are ongoing and are expected to grow; therefore,
in our view, they should be considered when NNSA updates its budget
validation schedule.
* Establish a DOE-compliant budget validation process. NNSA's May 2004
draft budget validation policy also outlined the Administration's
approach to budget validation. Specifically, the Administration will
follow a two-phased validation approach. During phase one, NNSA will
assess selected programs' conformance with strategic guidance, program
plans, and performance data and seek insight into how each organization
formulates its budget. During phase two, NNSA will choose a few of the
programs from the phase one review and conduct a detailed review that
examines the reasonableness of the cost estimates supporting the
program's budget. Following this two-phased approach, NNSA performed a
detailed validation review on only approximately 12 percent of the
Administration's budget submitted for fiscal years 2006 and 2007.
However, in our view, this approach does not adhere to DOE's guidance
on that subject. According to the director of DOE's Budget Operations
Division, commencing in fiscal year 2001 as a performance measure, DOE
has required that at least 20 percent of the budget undergo a detailed
review, so that 100 percent of the budget would be evaluated every 5
years. In our 2003 report on NNSA's Stockpile Life Extension Program,
we also found that NNSA was not conducting proper budget validation
reviews and, consequently, recommended that NNSA validate its stockpile
life extension budget request in accordance with DOE
directives.[Footnote 59] NNSA indicated that its budget validation
review focuses on the process used in developing budget requests and is
not an audit of the resulting budget estimates. NNSA further indicated
that it does not have the capabilities to audit and instead relies on
DOE's Office of Inspector General and GAO for those reviews. While such
reviews are helpful in evaluating budget estimates, we believe these
reviews do not abrogate NNSA's responsibility to adhere to DOE
requirements.[Footnote 60]
NNSA also noted that the results of its progress in implementing PPBE
are reflected in (1) the average scores received through the Office of
Management and Budget's Program Assessment Rating Tool scores which are
among the highest in DOE and the U.S. Government, (2) NNSA management
and operating contractors working without serious interruption through
multiple continuing resolutions in the past four years, and (3) NNSA
transitioning smoothly to the DOE budget formulation process in the
summer of 2006.
Conclusions:
Prior to the creation of NNSA, DOE's management of the nuclear weapons
complex was widely considered, in the words of the President's Foreign
Intelligence Advisory Board as "science at its best" and "security at
its worst." Underpinning this characterization was a long departmental
history of organizational disarray and poor security, project and
program management. Consequently, producing a well-organized and
effective agency out of what was widely considered a dysfunctional
enterprise has been a considerable challenge. In some areas, NNSA
should be viewed as a success. Most notably, through its internal
reorganization efforts, NNSA has addressed many major organizational
issues and has made important progress in establishing critical
management systems, especially PPBE.
However, without a workable model on how a separately organized agency
should function, NNSA and DOE officials have had to develop their
working relationships largely on a case-by-case basis, often with
limited success. The fact that the Congress felt it necessary to step
in and modify the NNSA Act to address continuing organizational
conflict within the counterintelligence program demonstrates, in our
view, that DOE and NNSA need to take a more active approach to clearly
defining DOE and NNSA's working relationships and determining how
conflict will be resolved. While there have been continuing calls for
removing NNSA from DOE and establishing it as a separate agency, we do
not believe that such drastic change is necessary to produce an
organization that can provide effective oversight of the nation's
nuclear weapons complex.
Beyond addressing organizational issues, if NNSA is ultimately to
provide comprehensive oversight of the operation and security of the
nation's nuclear weapons programs, it must address a variety of
lingering, often unrelated, but important management issues. These
issues include providing sufficient, qualified staff to conduct program
and operational oversight, especially in the security area, and
developing and implementing improvements needed to support effective
project, program, and financial management.
Recommendations for Executive Action:
To improve NNSA's efficiency and effectiveness, we are making 21
recommendations in five areas--organization, security, project
management, program management, and financial management.
To ensure that NNSA functions as a separately organized agency, we
recommend that the Secretary of Energy and the Administrator, NNSA,
take the following two actions:
* clearly define NNSA's status as a separately organized agency within
the department; and:
* develop and implement standard operating procedures for conducting
business and resolving conflicts between DOE and NNSA sister offices.
To improve security oversight, we recommend that the Administrator,
NNSA, take the following four actions:
* develop a human capital strategy that includes standards for
determining long-term staffing needs;
* implement a professional development program for security staff to
ensure the completion of training needed to effectively perform
oversight responsibilities;
* develop a framework to evaluate results from security reviews and
guide security improvements; and:
* establish formal mechanisms for sharing and implementing lessons
learned across the weapons complex.
To fully implement NNSA's management reforms, we recommend that the
Administrator, NNSA, institute a series of initiatives to improve
project management, program management, and financial management.
With respect to project management, we recommend that NNSA take the
following seven actions:
* establish an NNSA-specific project management policy to ensure
application of the DOE project management manual;
* prepare a project management improvement plan;
* reinstitute annual reporting to the Congress on project management
accomplishments;
* include major projects, such as the Stockpile Life Extension
refurbishments, in DOE's Project Assessment and Reporting System;
* complete a comprehensive database of all projects' reports on
management lessons learned to improve project management throughout
NNSA;
* develop benchmark data on individual contractors' project management
performance to assist managers in improving contractor performance;
and:
* require that contractors' project managers receive project manager
training and attain project manager certification.
With respect to program management, we recommend that NNSA take the
following three actions:
* prepare periodic reports that show the status of its program
management improvement efforts to determine how much progress is being
made;
* complete a best practices guide for program management; and:
* identify, train, and certify all program managers in accordance with
NNSA's program management policy.
With respect to financial management, we recommend that NNSA take the
following five actions:
* complete all NNSA PPBE policy guidance;
* establish an independent budget analysis unit;
* develop criteria for compiling a NNSA-wide priorities list to assist
NNSA in supporting its budget request;
* update the schedule of those NNSA programs requiring budget
validation to insure that recent program initiatives like the Reliable
Replacement Warhead are included; and:
* establish a DOE-compliant budget validation process.
Agency Comments and Our Evaluation:
We provided NNSA with a copy of this report for their review and
comment. NNSA generally agreed with the report and its corresponding
recommendations. NNSA noted that it considers the agency to be a
success but acknowledged that there was considerable work yet to be
accomplished. NNSA and DOE also provided technical comments, which we
have incorporated in this report as appropriate. NNSA's comments on our
draft report are presented in appendix I.
As arranged with your office, unless you publicly announce its contents
earlier, we plan no further distribution of this report until 30 days
after the date of this report. We are sending copies of this report to
appropriate congressional committees, the Secretary of Energy; the
Administrator, NNSA; and the Director of the Office of Management and
Budget. We will also make copies available to others upon request. In
addition, the report will be available at no charge on the GAO Web site
at [Hyperlink, http://www.gao.gov].
If you or your staff have any questions about this report or need
additional information, please contact me at (202) 512-3481 or
aloiseg@gao.gov. Contact points for our Offices of Congressional
Relations and Public Affairs may be found on the last page of this
report. GAO staff who made major contributions to this report are
listed in appendix II.
Signed by:
Gene Aloise:
Director, Natural Resources and Environment:
[End of section]
Appendix I Comments from the National Nuclear Security Administration:
Department of Energy:
National Nuclear Security Administration:
Washington, DC 20585:
December 21, 2006:
Mr. Gene Aloise:
Director, Natural Resources And Environment:
U.S. Government Accountability Office:
Washington, DC 20548:
Dear Mr. Aloise:
The National Nuclear Security Administration (NNSA) appreciates the
opportunity to review the Government Accountability Office's (GAO)
draft report: GAO-07-36, "National Nuclear Security Administration:
Additional Actions Needed to Improve Management of the Nation's Nuclear
Programs." We understand that the House's Chairman and Ranking Minority
Member, Strategic Forces Subcommittee, Committee on Armed Services
asked GAO to review the steps NNSA has taken to improve security at its
laboratories and plants and to improve its management practices and
revise its organizational structure.
NNSA generally agrees with the report and its corresponding
recommendations. We note that we consider NNSA a success but we
acknowledge that there is considerable work yet to be accomplished.
NNSA will provide detailed responses to the recommendations during the
Management Decision phase after the Final Report has been issued. In
the interim, I have attached a copy of the draft report with annotated
comments for edification and clarification. Should you have any
questions about this response, please contact Richard Speidel,
Director, Policy and Internal Controls Management.
Sincerely,
Signed by:
Michael C. Kane:
Associate Administrator for Management and Administration:
Attachment:
cc: Chief Operating Officer:
Director, Service Center:
Senior Procurement Executive:
[End of section]
Appendix II: GAO Contact and Staff Acknowledgments:
GAO Contact:
Gene Aloise (202) 512-3841:
Staff Acknowledgments:
In addition to the individual named above, James Noel, Assistant
Director; Robert Baney; Preston Heard; Jonathan Ban; Rebecca Shea;
Cynthia Daffron; Greg Marchand; and Carol Herrnstadt Shulman made key
contributions to this report.
(360556):
FOOTNOTES
[1] GAO, National Nuclear Security Administration: Key Management
Structure and Workforce Planning Issues Remain as NNSA Conducts
Downsizing, GAO-04-545, (Washington, D.C.: June 25, 2004).
[2] A special investigative panel, President's Foreign Intelligence
Advisory Board, Science at its Best, Security at its Worst: A Report on
Security Problems at the U.S. Department of Energy (Washington, D.C.:
June 1999).
[3] Pub. L. No. 106-65, 113 Stat. 512, 953 (1999).
[4] The Office of Naval Reactors is managed as a separate entity within
NNSA reporting to both NNSA and the U.S. Navy.
[5] GAO, Nuclear Security: NNSA Needs to Better Manage Its Safeguards
and Security Program, GAO-03-471 (Washington, D.C.: May 30, 2003).
[6] See Strengthening NNSA Security Expertise: An Independent Analysis,
Henry G. Chiles et al., March 2004 and NNSA Security: An Independent
Review, LMI Government Consulting, April 2005.
[7] See, for example, GAO, National Ignition Facility: Management and
Oversight Failures Caused Major Cost Overruns and Schedule Delays, GAO/
RCED-00-271 (Washington, D.C.: Aug. 8, 2000).
[8] See NNSA Security, An Independent Review, LMI Government
Consulting, Apr. 2005. This effort was directed by Admiral Richard W.
Mies USN (Retired).
[9] House Armed Services Committee Special Panel on the Department of
Energy Reorganization, 106th Cong., Department of Energy National
Nuclear Security Administration Implementation Plan (Feb. 2000); House
Armed Services Committee Special Panel on the Department of Energy
Reorganization, 106th Cong., Establishing the National Nuclear Security
Administration: A Year of Obstacles and Opportunities (Oct. 13, 2000).
[10] Pub. L. No. 109-364, § 3117 (2006).
[11] National Nuclear Security Administration's Planning, Programming,
Budgeting, and Evaluation Process, DOE/IG-0614, Aug. 2003.
[12] Institute for Defense Analysis, The Organization and Management of
the Nuclear Weapons Program (Washington, D.C.: Mar. 1997).
[13] A special investigative panel, President's Foreign Intelligence
Advisory Board, Science At Its Best, Security At Its Worst: A Report on
Security Problems at the U.S. Department of Energy (Washington, D.C.:
June 1999).
[14] See GAO, High-Risk Series: An Update, GAO-01-263 (Washington,
D.C.: Jan. 2001), and GAO, High Risk Series: An Update, GAO-03-119
(Washington, D.C.: Jan. 2003). Also, see GAO, Performance and
Accountability Series--Major Management Challenges and Program Risks: A
Governmentwide Perspective, GAO-01-241 (Washington, D.C.: Jan. 2001).
In addition, see the accompanying 21 reports (numbered GAO-01-242
through GAO-01-262) on specific agencies.
[15] GAO, Human Capital: Key Principles for Effective Strategic
Workforce Planning, GAO-04-39 (Washington, D.C.: Dec. 11, 2003).
[16] GAO, Department of Energy: Views on the Progress of the National
Nuclear Security Administration in Implementing Title 32, GAO-01-602T
(Washington, D.C.: Apr. 4, 2001).
[17] GAO, NNSA Management: Progress in the Implementation of Title 32,
GAO-02-93R (Washington, D.C.: Dec. 12, 2001).
[18] GAO, Department of Energy: NNSA Restructuring and Progress in
Implementing Title 32, GAO-02-451T (Washington, D.C.: Feb. 26, 2002).
[19] GAO-03-471.
[20] GAO-04-545.
[21] DOE, Secretary of Energy Advisory Board, Report of the Nuclear
Weapons Complex Infrastructure Task Force: Recommendations for the
Nuclear Weapons Complex of the Future (Washington, D.C.: July 13,
2005).
[22] Physical security combines security equipment, personnel, and
procedures to protect facilities, information, documents or material
against theft, sabotage, diversion, or other criminal acts. For the
purposes of analyzing trends in NNSA's physical security ratings we
combined the ratings for the following topical areas: Protection
Program Management; Physical Security Systems; Protective Force;
Classified Matter Protection and Control, Materials Control and
Accountability; and Personnel Security.
[23] GAO, Nuclear Security: Improvements Needed in DOE's Safeguards and
Security Oversight, GAO/RCED-00-62 (Washington, D.C.: Feb. 24, 2000).
[24] Inspection of Allegations Relating to the Albuquerque Operations
Office Security Survey Process and the Security Operations' Self-
Assessment at Los Alamos National Laboratory, DOE/IG-0471, May 2000.
[25] Review of the National Nuclear Security Administration's Federal
Line Management Oversight of Security Operations, Office of Independent
Oversight and Performance Assurance, DOE, 2005.
[26] GAO, Standards for Internal Control in the Federal Government,
GAO/AIMD-00-21.3.1 (Washington, D.C.: Nov. 1999).
[27] The Design Basis Threat is a classified document that identifies
the potential size and capabilities of a terrorist force that DOE
protective forces must be able to defeat.
[28] Section 3232 of the NNSA Act requires that the Chief of DNS report
to the Administrator and have direct access to the Secretary and every
departmental official on security matters. See 50 U.S.C. § 2422.
[29] GAO-03-471.
[30] GAO-04-545.
[31] Strengthening NNSA Security Expertise: An Independent Analysis,
Henry G. Chiles et al., Mar. 2004.
[32] Inspection Report: Security and Other Issues Related to Out-
Processing of Employees at Los Alamos National Laboratory, DOE/IG-0677
(Washington, D.C., Feb. 22, 2005).
[33] Inspection Report: Security Clearance Terminations and Badge
Retrieval at the Lawrence Livermore National Laboratory, DOE/IG-0716
(Washington, D.C., Jan. 19, 2006) and Inspection Report: Badge
Retrieval and Security Clearance Termination at Sandia National
Laboratory--New Mexico, DOE/IG-0724 (Washington, D.C., Apr. 18, 2006).
[34] GAO/AIMD-00-21.3.1.
[35] 50 U.S.C. § 2401 note.
[36] GAO-01-602T.
[37] Pub. L. No. 106-398, § 3157, 114 Stat. 1654, 1654A-468 (2000)
(codified as amended at 50 U.S.C. § 2410).
[38] In commenting on our draft report, DOE's Office of General Counsel
indicated that it believed the prohibitions contained in the NNSA Act
regarding "authority, direction, and control" prevented DOE and NNSA
from better defining their working relationship. Sections 3202 and 3220
of the NNSA Act shield NNSA personnel, except for the NNSA
Administrator and NNSA intelligence and counterintelligence personnel,
from the authority, direction, and control of DOE personnel. See 42
U.S.C. § 7132, 50 U.S.C. § 2410. The Administrator is subject to the
authority, direction, and control of the Secretary or Deputy Secretary
of Energy, who cannot redelegate those powers. NNSA intelligence and
counterintelligence personnel were also recently subjected to DOE
authority, direction, and control, as we describe later in this report.
In the view of DOE's Office of General Counsel, this statutory
structure is the reason for ongoing coordination problems, regardless
of whether formal procedures have been put in place between DOE and
NNSA offices.
[39] Section 3262 of the NNSA Act requires the Administrator to
establish procedures to comply with Federal Acquisition Regulations.
See 50 U.S.C. § 2462.
[40] See 50 U.S.C. § 2402(d).
[41] Pub. L. No. 109-364, § 3117 (2006).
[42] H.R. Conf. Rep. No. 109-702 at 969-971 (Sep. 29, 2006).
[43] Pub. L. 106-398, § 3157, 114 Stat. 1654, 1654A-468 (2000)
(codified as amended at 50 U.S.C. § 2410).
[44] NNSA Security: An Independent Review, April 2005.
[45] GAO-02-93R.
[46] GAO-04-545.
[47] GAO, Nuclear Weapons: Opportunities Exist to Improve the
Budgeting, Cost Accounting, and Management Associated with the
Stockpile Life Extension Program, GAO-03-583 (Washington, D.C.: July
28, 2003).
[48] Measuring Performance and Benchmarking Project Management at the
Department of Energy, National Research Council of the National
Academies, 2005.
[49] Improving Project Management in the Department of Energy, National
Research Council of the National Academies, 1999.
[50] Independent Research Assessment of Project Management Factors
Affecting Department of Energy Project Success, Civil Engineering
Research Foundation, July 12, 2004.
[51] Formally termed the NNSA Program Management Workload Reduction
Team, the team's charter was to arrive at a realistic, uniform, and
timely approach for optimizing and implementing Federal management
processes across NNSA.
[52] NNSA's Office of Defense Programs has issued a best practices
document to assist its program managers in the preparation of program
plans.
[53] Two NNSA program management improvement teams, one established in
2002 and the other in 2003, recommended training program managers. For
example, the 2003 team noted that there was a finite set of officially
designated NNSA program managers who needed to be trained and certified
to a minimum set of qualification standards and recommended an
implementation schedule to have all NNSA program managers named by
January 1, 2004, and a policy setting out program management
qualification standards implemented across NNSA by October 1, 2004.
[54] 50 U.S.C. § 2452.
[55] 50 U.S.C. § 2453.
[56] Audit Report: National Nuclear Security Administration's Planning,
Programming, Budgeting, and Evaluation Process, DOE/IG-0614, Aug. 5,
2003.
[57] GAO-03-583.
[58] The Nonproliferation and Verification Research and Development
Program's mission is to conduct needs-driven research, development,
testing, and evaluation of new technologies that are intended to
strengthen the United States' ability to prevent and respond to
nuclear, chemical, and biological attacks. The Highly-Enriched Uranium
Transparency Implementation Program's mission is to ensure that the
nonproliferation goals of the February 1993 agreement on the U.S.
purchase of uranium from the Russian Federation are met.
[59] GAO-03-583.
[60] According to NNSA Policy Letter NAP-1 dated May 21, 2002, DOE
orders are applicable to NNSA unless or until a NNSA policy letter is
provided.
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