Recovery Act
Most DOE Cleanup Projects Appear to Be Meeting Cost and Schedule Targets, but Assessing Impact of Spending Remains a Challenge Gao ID: GAO-10-784 July 29, 2010The American Reinvestment Act of 2009 aims to stimulate the economy, including funding for environmental cleanup projects. The Department of Energy (DOE) receives annual appropriations of $6 billion to support the cleanup of radioactive and hazardous wastes resulting from decades of nuclear weapons research and production. GAO was asked to examine (1) how DOE selected projects for funding and developed cost and schedule targets, (2) project status and extent to which projects are achieving these targets, and (3) key challenges faced and efforts to address them. GAO reviewed Recovery Act project documentation, including cost, schedule, and performance data for 84 projects at 17 sites; visited the 4 sites receiving most of the funding; and interviewed headquarters and site officials.
DOE's Office of Environmental Management generally chose to use Recovery Act funds for cleanup projects that could be quickly started and finished. Most projects also had existing contracts, which allowed DOE to update and validate cost and schedule targets within a short time. DOE generally funded four types of projects: decontaminating or demolishing facilities, removing contamination from soil and groundwater, packaging and disposing of transuranic and other wastes, and supporting the maintenance and treatment of liquid tank wastes. In all, DOE selected 84 projects at 17 DOE sites in 12 states for Recovery Act funding, with 4 sites receiving most of the money. As of May 2010, DOE had begun work on all Recovery Act projects and reported creating about 5,600 full-time equivalent jobs at the 17 sites during the first quarter of 2010. Spending on Recovery Act projects has been slower than planned. DOE had obligated about $5.5 billion of the $6 billion in Recovery Act cleanup funding and spent about $1.9 billion of those funds. This sum is less than the $2.3 billion DOE had expected to spend by that time. DOE reported that most Recovery Act projects were achieving cost and schedule targets, although a third of projects were not. DOE has faced familiar challenges in both managing Recovery Act projects and measuring how Recovery Act funding has affected cleanup and other goals. According to DOE officials, a third of projects did not meet cost and schedule targets for some of the same reasons that have plagued DOE in the past: technical, regulatory, safety, and contracting issues. DOE has taken steps aimed at strengthening project management and oversight for Recovery Act projects, such as increasing project reporting requirements and placing tighter controls on when funds are disbursed to sites, but it is uncertain how these steps will ultimately affect Recovery Act project performance, or whether they hold the potential to be useful for cleanup work funded under annual appropriations. Measuring the impact of Recovery Act funding on job creation and DOE's cleanup goals has also been a challenge for DOE, in particular, providing an accurate assessment of the act's impact on jobs, environmental risk reduction, and the life-cycle costs of its cleanup program. DOE has used three different methodologies to assess and report jobs created, which provide very different and potentially misleading, pictures of jobs created. For example, the calculations ranged from about 5,700 jobs to 20,200, depending on the methodology used. Also, DOE has not developed a clear means of measuring how cleanup work funded by the act will affect environmental risk or reduce its footprint--the land and facilities requiring DOE cleanup. Further, it is unclear to what extent Recovery Act funding will reduce the costs of cleaning up the DOE complex over the long term. DOE's estimate of $4 billion in life cycle cost savings resulting from Recovery Act funding was not calculated in accordance with federal guidance. GAO's analysis indicates that those savings could be 80 percent less than DOE estimated. Without clear and consistent measures, it will be difficult to say whether or how Recovery Act funding has affected DOE's cleanup goals. GAO recommends four actions for DOE to improve project management and reporting: (1) determine whether project management and oversight steps adopted for Recovery Act projects would benefit other cleanup projects, (2) clarify the methodology used to calculate jobs created, (3) develop clear and quantifiable measures for determining the impact of Recovery Act funding, and (4) ensure that cost savings are calculated according to federal guidance. DOE agreed with the recommendations.
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: Eugene E. Aloise Team: Government Accountability Office: Natural Resources and Environment Phone: (202) 512-6870GAO-10-784, Recovery Act: Most DOE Cleanup Projects Appear to Be Meeting Cost and Schedule Targets, but Assessing Impact of Spending Remains a Challenge
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Report to Congressional Requesters:
United States Government Accountability Office:
GAO:
July 2010:
Recovery Act:
Most DOE Cleanup Projects Appear to Be Meeting Cost and Schedule
Targets, but Assessing Impact of Spending Remains a Challenge:
GAO-10-784:
GAO Highlights:
Highlights of GAO-10-784, a report to congressional requesters.
Why GAO Did This Study:
The American Recovery and Reinvestment Act of 2009 aims to stimulate
the economy, including funding for environmental cleanup projects. The
Department of Energy (DOE) receives annual appropriations of $6
billion to support the cleanup of radioactive and hazardous wastes
resulting from decades of nuclear weapons research and production.
GAO was asked to examine (1) how DOE selected projects for funding and
developed cost and schedule targets, (2) project status and extent to
which projects are achieving these targets, and (3) key challenges
faced and efforts to address them. GAO reviewed Recovery Act project
documentation, including cost, schedule, and performance data for 84
projects at 17 sites; visited the 4 sites receiving most of the
funding; and interviewed headquarters and site officials.
What GAO Found:
DOE‘s Office of Environmental Management generally chose to use
Recovery Act funds for cleanup projects that could be quickly started
and finished. Most projects also had existing contracts, which allowed
DOE to update and validate cost and schedule targets within a short
time. DOE generally funded four types of projects: decontaminating or
demolishing facilities, removing contamination from soil and
groundwater, packaging and disposing of transuranic and other wastes,
and supporting the maintenance and treatment of liquid tank wastes. In
all, DOE selected 84 projects at 17 DOE sites in 12 states for
Recovery Act funding, with 4 sites receiving most of the money.
As of May 2010, DOE had begun work on all Recovery Act projects and
reported creating about 5,600 full-time equivalent jobs at the 17
sites during the first quarter of 2010. Spending on Recovery Act
projects has been slower than planned. DOE had obligated about $5.5
billion of the $6 billion in Recovery Act cleanup funding and spent
about $1.9 billion of those funds. This sum is less than the $2.3
billion DOE had expected to spend by that time. DOE reported that most
Recovery Act projects were achieving cost and schedule targets,
although a third of projects were not.
DOE has faced familiar challenges in both managing Recovery Act
projects and measuring how Recovery Act funding has affected cleanup
and other goals. According to DOE officials, a third of projects did
not meet cost and schedule targets for some of the same reasons that
have plagued DOE in the past: technical, regulatory, safety, and
contracting issues. DOE has taken steps aimed at strengthening project
management and oversight for Recovery Act projects, such as increasing
project reporting requirements and placing tighter controls on when
funds are disbursed to sites, but it is uncertain how these steps will
ultimately affect Recovery Act project performance, or whether they
hold the potential to be useful for cleanup work funded under annual
appropriations. Measuring the impact of Recovery Act funding on job
creation and DOE‘s cleanup goals has also been a challenge for DOE, in
particular, providing an accurate assessment of the act‘s impact on
jobs, environmental risk reduction, and the life-cycle costs of its
cleanup program. DOE has used three different methodologies to assess
and report jobs created, which provide very different and potentially
misleading, pictures of jobs created. For example, the calculations
ranged from about 5,700 jobs to 20,200, depending on the methodology
used. Also, DOE has not developed a clear means of measuring how
cleanup work funded by the act will affect environmental risk or
reduce its footprint”the land and facilities requiring DOE cleanup.
Further, it is unclear to what extent Recovery Act funding will reduce
the costs of cleaning up the DOE complex over the long term. DOE‘s
estimate of $4 billion in life cycle cost savings resulting from
Recovery Act funding was not calculated in accordance with federal
guidance. GAO‘s analysis indicates that those savings could be 80
percent less than DOE estimated. Without clear and consistent
measures, it will be difficult to say whether or how Recovery Act
funding has affected DOE‘s cleanup goals.
What GAO Recommends:
GAO recommends four actions for DOE to improve project management and
reporting: (1) determine whether project management and oversight
steps adopted for Recovery Act projects would benefit other cleanup
projects, (2) clarify the methodology used to calculate jobs created,
(3) develop clear and quantifiable measures for determining the impact
of Recovery Act funding, and (4) ensure that cost savings are
calculated according to federal guidance. DOE agreed with the
recommendations.
View [hyperlink, http://www.gao.gov/products/GAO-10-784] or key
components. For more information, contact Gene Aloise at (202) 512-
3841 or aloisee@gao.gov.
[End of section]
Contents:
Letter:
Background:
For Recovery Act Funding, DOE Generally Selected "Shovel-Ready"
Projects Whose Cost and Schedule Targets Had Been Developed and Needed
Minimal Work to Finalize:
DOE Has Begun Work on All Projects, Most Appear to Be Meeting Cost and
Schedule Targets, and Spending Overall Has Been Slower Than Planned:
DOE Has Taken Steps to Help Address Potential Problems but Continues
to Face Key Challenges in Managing Projects and Measuring Their Impact:
Conclusions:
Recommendations for Executive Action:
Agency Comments and Our Evaluation:
Appendix I: Scope and Methodology:
Appendix II: Description of Four Projects Reviewed in Depth:
Appendix III: Recovery Act Project Cost Data through March 2010:
Appendix IV: Recovery Act Project Performance through March 2010:
Appendix V: Comments from the Department of Energy:
Appendix VI: GAO Contact and Staff Acknowledgments:
Related GAO Products:
Tables:
Table 1: Spending on Recovery Act Cleanup Projects through May 2010:
Table 2: Number of Recovery Act Cleanup Jobs Created by DOE, as
Calculated According to OMB and DOE Guidance, as of March 31, 2010:
Figures:
Figure 1: Sites Selected to Receive Recovery Act Funding:
Figure 2: Aerial and Interior View of Building K-33, East Tennessee
Technology Park, Oak Ridge Reservation:
Figure 3: Workers Packaging Transuranic Waste, Savannah River Site:
Figure 4: Selected Performance Measures for Environmental Management's
Recovery Act Projects, Reported by DOE, as of March 2010:
Figure 5: Performance of Recovery Act Projects, as of March 31, 2010:
Abbreviations:
CERCLA: Comprehensive Environmental Response, Compensation, and
Liability Act:
DOE: Department of Energy:
EPA: Environmental Protection Agency:
FTE: full-time equivalent:
OMB: Office of Management and Budget:
[End of section]
United States Government Accountability Office:
Washington, DC 20548:
July 29, 2010:
The Honorable Joe Barton:
Ranking Member:
Committee on Energy and Commerce:
House of Representatives:
The Honorable Peter J. Visclosky:
Chairman:
The Honorable Rodney P. Frelinghuysen:
Ranking Member:
Subcommittee on Energy and Water Development:
Committee on Appropriations:
House of Representatives:
The Honorable Michael C. Burgess:
Ranking Member:
Subcommittee on Oversight and Investigations:
Committee on Energy and Commerce:
House of Representatives:
The Honorable Greg Walden:
House of Representatives:
In response to what is generally reported to be the most serious
economic crisis since the Great Depression, the American Recovery and
Reinvestment Act of 2009 (Recovery Act) was enacted on February 17,
2009.[Footnote 1] The purposes of the act, among other aims, are to
preserve and create jobs, to promote economic recovery, and to provide
investments to increase economic efficiency by spurring technological
advances in science and health. Initially estimated to cost $787
billion, the Recovery Act includes an estimated $580 billion in
spending, including for environmental protection. One of the
departments the act directs funds to--the Department of Energy (DOE)--
received appropriations of $6 billion to expand and accelerate its
efforts to clean up numerous contaminated sites across the country,
where decades of nuclear weapons research, development, and production
left a legacy of dangerously radioactive, chemical, and other
hazardous wastes.
DOE's Office of Environmental Management directs the cleanup of this
contamination across the DOE complex. The sites contain nuclear
reactors; chemical processing buildings; and plants, laboratories, and
maintenance facilities once used to manufacture thousands of nuclear
warheads. Cleanup activities include treating and permanently
disposing of millions of gallons of radioactive and chemical waste
stored in large underground tanks; disposing of spent nuclear fuel;
removing contaminated soil; treating contaminated groundwater;
packaging and shipping solid wastes infused with synthetic radioactive
elements like plutonium and americium for permanent disposal to a deep
geologic repository; and eliminating excess facilities, which may
include decontaminating, decommissioning, deactivating, and
demolishing obsolete structures or a combination of these activities.
DOE has estimated that the cost of this cleanup may approach $300
billion[Footnote 2] over the next several decades.
Recovery Act funding, which DOE intends to spend over 2.5 years,
substantially boosts the Office of Environmental Management's annual
appropriation for cleanup, of between $6 and $7 billion. DOE
designated the bulk of this new funding--almost 80 percent--to speed
cleanup activities at four large sites: the Hanford Site in Washington
State; Idaho National Laboratory in Idaho; the Oak Ridge Reservation
in Tennessee; and the Savannah River Site in South Carolina. As we
have previously reported,[Footnote 3] most of these sites have
contended with various contract or project management challenges in
the past, which have resulted in significant cost overruns or delays
lasting years for some projects.
You asked us to examine (1) how DOE selected projects for Recovery Act
funding and developed cost and schedule targets, (2) the status of
Recovery Act projects and the extent to which the projects are
achieving cost and schedule targets and performance measures, and (3)
key challenges DOE has faced in carrying out these projects and its
efforts to address them.
To conduct our work, we reviewed pertinent provisions of the American
Recovery and Reinvestment Act of 2009; federal regulations guiding
government acquisition of goods and services; Office of Management and
Budget (OMB) and DOE policies, procedures, and guidance on Recovery
Act implementation; and relevant studies of Recovery Act
implementation. To determine how DOE selected projects and developed
cost and schedule targets, we reviewed relevant project documentation,
including project operating plans, DOE assessments of proposed cost
and schedule targets, and project risk assessments. We obtained data
on costs, schedules, and jobs created as of March 2010, the most
recent data available, from DOE's Environmental Management Recovery
Act Program office. We also interviewed DOE headquarters and federal
project and contractor officials at each of the 17 sites receiving
Recovery Act funding.[Footnote 4] We interviewed officials at 13 sites
by phone and visited the 4 DOE cleanup sites receiving the bulk of the
$6 billion in Recovery Act funding for environmental cleanup: (1) the
Hanford Site, (2) Idaho National Laboratory, (3) the Oak Ridge
Reservation, and (4) the Savannah River Site. At each site, we
reviewed project documentation, interviewed officials, and observed
Recovery Act work under way. In addition, at the Hanford and Savannah
River sites, we also selected a nonrandom sample of four of the
costliest projects--two projects involving demolition of facilities, a
project to remediate soil and groundwater, and a project to package
and dispose of waste--to better understand how cost and schedule
estimates were developed and to assess the reliability of estimates
for these projects. Two projects were located at the Hanford Site and
two at the Savannah River Site. To assess to what extent projects were
meeting cost and schedule targets, we reviewed March 2010 data, the
most recent available, from DOE's system for tracking project
performance, called an earned value management system, and also
reviewed data on project-related performance measures that refer to
specific cleanup activities. To determine what key challenges DOE
faced and the steps officials took to address these challenges, we
reviewed pertinent Recovery Act project guidance and DOE project
documents and reports, and interviewed headquarters officials and
federal and contractor officials at all 17 sites. We also conferred
with staff from DOE's Office of Inspector General. To assess the
reliability of data we reviewed, we sent out questionnaires to DOE
headquarters and site officials regarding the steps taken to ensure
the accuracy of data related to measuring progress toward cost and
schedule targets, jobs created, and other project outcomes. We
determined that the data were sufficiently reliable for the purposes
of our report. Appendix I presents a more detailed description of our
scope and methodology. Appendix II provides more information on the
four projects reviewed in depth.
We conducted this performance audit from June 2009 to July 2010, in
accordance with generally accepted government auditing standards.
Those standards require that we plan and perform the audit to obtain
sufficient, appropriate evidence to provide a reasonable basis for our
findings and conclusions based on our audit objectives. We believe
that the evidence obtained provides a reasonable basis for our
findings and conclusions based on our audit objectives.
Background:
Since the 1940s, DOE and its predecessor agencies have operated a
nationwide complex of facilities used to research, design, and
manufacture nuclear weapons and related technologies. DOE also
conducts research in energy and sciences ranging from harnessing
geothermal power as a renewable resource to the behavior of subatomic
particles colliding at nearly the speed of light. Organizationally,
DOE supports this broad range of activities with a diverse group of
mission-based program elements. These include the Office of Science,
charged with conducting basic science and technology research; the
National Nuclear Security Administration, which oversees the nation's
nuclear weapons stockpile; and the Office of Environmental Management,
which leads the department's often complex and challenging effort to
clean up nuclear, chemical, and other hazardous wastes. Environmental
Management carries out its work at numerous DOE sites and facilities
around the country, primarily through private entities that manage the
facilities and work under contract to DOE. About 90 percent of DOE's
annual budget (which totaled about $27 billion in fiscal year 2010)
goes to contracts with private firms. An extensive network of site
offices directly oversees the work of these contractors.
In 1990, GAO designated DOE's contract management, including both
contract administration and project management, at high risk for
fraud, waste, abuse, and mismanagement. In the following two decades,
continued ineffective oversight and poor contract management led to
substantial cost overruns and lengthy delays on many projects overseen
by DOE, in particular, the Office of Environmental Management. DOE has
faced difficulties in developing realistic cost and schedule targets
and then achieving them, in part because of challenges addressing
complex technical issues, negotiating contracts, complying with
regulatory issues, and ensuring safety.[Footnote 5] Recently, for
example, factors such as these have delayed completion of Hanford's
Waste Treatment and Immobilization Plant in Washington State. The
project has been delayed by 8 years, while costs have escalated, more
than doubling the initial estimate, from $4.3 to $12.2 billion. The
treatment plant was one of nine major DOE construction projects,
collectively valued at about $14 billion, that as of 2009 had exceeded
both their original cost and schedule estimates. As we recently
reported, DOE has taken steps to improve its contract and management
activities, including in 2000 issuing its order 413.3A, which
established a process for managing projects, from beginning to end.
[Footnote 6] The order established five major milestones--or "critical
decision points"--that span a project's life, beginning with approval
of need and ending with project completion. Order 413.3A specifies the
requirements that must be met, along with the documentation necessary,
to move past each milestone, including when a variety of independent
reviews should occur to assess progress. Other steps DOE has taken
include developing a root-cause analysis, a corrective action plan,
and performance measures intended to help assess progress.
Nevertheless, Environmental Management's contract and project
management activities remain on GAO's list of programs or agencies at
high risk for fraud, waste, abuse, and mismanagement.
The Recovery Act is intended to promote economic recovery, make
investments, and minimize or avert reductions in state and local
government services. The Congressional Budget Office estimated that
the Recovery Act would increase employment by about 1.2 million to 3.6
million jobs by the end of 2010. Enacted on February 17, 2009, the act
directed that priority be given to projects that could be started
quickly. The administration referred to such projects as "shovel-
ready." Projects funded by the Recovery Act must comply with section
1512 of the act, which requires funding recipients to report quarterly
on a number of measures, including the amount of funds expended or
obligated to projects or activities, and the number of jobs created.
The act generally requires that all awarded funding must be obligated
by September 30, 2010. Funds must be expended by September 30, 2015.
In implementing environmental cleanup work under the Recovery Act,
Environmental Management established several goals. These goals
included creating jobs; reducing DOE's "footprint," or area with
ongoing cleanup activity; reducing the life-cycle costs associated
with hazardous waste cleanup; completing cleanup activities at three
small sites; and meeting a number of regulatory cleanup deadlines that
it might not otherwise meet. In addition, Environmental Management set
an internal deadline to expend all Recovery Act funds and complete
Recovery Act work by the end of fiscal year 2011.
For Recovery Act Funding, DOE Generally Selected "Shovel-Ready"
Projects Whose Cost and Schedule Targets Had Been Developed and Needed
Minimal Work to Finalize:
DOE generally chose to use Recovery Act funds for cleanup projects
that could be quickly started and finished. The majority of the
projects selected also had existing contracts, which allowed the
department to update and validate new cost and schedule targets within
a short time frame.
Recovery Act Funding Enabled DOE to Implement Shovel-Ready Projects It
Had Identified in Recent Planning Efforts:
At the time the Recovery Act was passed, DOE was well positioned to
select projects that could be implemented quickly with Recovery Act
funding. DOE officials said they had planning efforts under way since
2006, which were aimed at identifying relatively low-risk cleanup
projects that could reduce DOE's cleanup footprint and speed overall
site remediation. Such projects included, for example, facility
demolition, groundwater or soil remediation, or finishing work that
could help accelerate site closure. These projects generally had
contracts, including cost and schedule targets, in place; they used
proven technologies, had secured needed regulatory approvals, and were
therefore considered "shovel-ready." (According to DOE officials, this
focus on discrete, low-risk projects stemmed in part from lessons
learned during a 2002 cleanup acceleration attempt, which ultimately
did not work well for complex and costly projects.[Footnote 7]) In
addition to its internal deadline to expend all Recovery Act funds and
complete work by the end of fiscal year 2011, other criteria--
including job creation and reducing environmental risk--also
influenced DOE's selection. DOE officials said that in selecting these
projects, they had to balance competing goals. For example, to begin
and complete work quickly, they chose a portfolio of cleanup projects
that may ultimately reduce DOE's footprint--its physical presence--on
the national landscape by 372 square miles (approximately 40 percent)
but would not address the most dangerously radioactive and hazardous
wastes and the environmental risks these wastes present.
In all, DOE selected 84 projects at 17 DOE sites in 12 states for
Recovery Act funding (see figure 1) with the majority of the money
going to four sites--Hanford, Idaho National Laboratory, the Oak Ridge
Reservation, and Savannah River (see appendix III).
Figure 1: Sites Selected to Receive Recovery Act Funding:
[Refer to PDF for image: illustrated U.S. map]
Hanford Site: Richland Operations Office;
10 projects, $1,635 million.
Hanford Site: Office of River Protection;
5 projects,$326 million.
Idaho National Laboratory:
8 projects, $468 million.
SLAC Accelerator Laboratory:
1 project, $8 million.
Nevada Test Site:
1 project, $44 million.
Moab UMTRA Site:
1 project, $108 million.
Energy Technology Engineering Center:
2 projects, $54 million.
Los Alamos National Laboratory:
4 projects, $212 million.
Waste Isolation Pilot Plant:
3 projects, $172 million.
Argonne National Laboratory:
4 projects, $79 million.
Mound Site:
1 project, $20 million.
West Valley Demonstration Project:
3 projects, $74 million.
Paducah Site:
3 projects, $80 million.
Oak Ridge Reservation:
14 projects, $755 million.
Savannah River Site:
14 projects, $1,615 million.
Portsmouth Site:
5 projects, $120 million.
Brookhaven National Laboratory:
3 projects, $62 million.
Separations Process Research Unit:
2 projects, $52 million.
Sources: DOE; Map Resources (map).
[End of figure]
The vast majority of projects had been included in the sites' own work
plans, such as groundwater remediation at Los Alamos National
Laboratory, but some projects also represented work newly transferred
from other program offices, such as remediation and demolition of a
former weapons facility at Oak Ridge Reservation. In general, projects
chosen for Recovery Act funding fell into four main categories of work:
* Decontaminating and demolishing facilities: for example,
decontaminating and demolishing the K-33 building at the Oak Ridge
Reservation.[Footnote 8] A two-level structure that covers 32 acres
(see figure 2) was constructed in 1954 to process and enrich uranium
for use in nuclear weapons. Although uranium enrichment operations
ceased in 1985, the building's piping and other equipment were not
removed completely until 2005, and radiological and chemical
contamination remains throughout the building. DOE had initially
selected a different building for demolition, K-27, which was also
used to process and enrich uranium, but it found unexpectedly high
levels of mercury contamination, complicating that cleanup. So in
February 2010, DOE decided to instead demolish the K-33 building--a
much larger building but a less-contaminated and less-complex cleanup
project--at a cost of $65 million. Work began in April 2010. Given the
delay in starting the project, site officials expect the project to be
completed in 2012.
Figure 2: Aerial and Interior View of Building K-33, East Tennessee
Technology Park, Oak Ridge Reservation:
[Refer to PDF for image: 2 photographs]
Source: DOE.
[End of figure]
* Removing contamination from soil and groundwater: for example,
removing and disposing of radioactive and hazardous contaminants from
soil and groundwater at the Mound Site, a former production site for
explosives and other weapons' components. Production at the site
ceased in 1995. The site's contractor declared the physical completion
of environmental cleanup of the site in July 2006, although a landfill
remained, which DOE planned to monitor for contamination. Congress,
however, directed further remediation of the landfill at the site. The
project includes excavating and disposing of contaminated soils and
backfilling the site. Although work began with base funding, the
funding was insufficient to complete removal of the contamination.
Recovery Act funding of $19.7 million was applied to the project to
complete remaining work, with an expected site closure date of
September 2010.[Footnote 9]
* Packaging and disposing of transuranic and other wastes: for
example, characterizing and packaging transuranic wastes at multiple
DOE sites for shipment to the department's deep geologic repository
for permanent disposal. (See figure 3.) Transuranic wastes are
typically discarded rags, tools, equipment, soils, or other solid
materials that have been contaminated by radioactive elements, such as
plutonium or americium.[Footnote 10] About 110,000 cubic meters of
these wastes were generated mostly after 1970 and then stored at
various DOE sites. Because these wastes remain radioactive for
extremely long periods--hundreds of thousands of years in some cases--
most are headed for disposal at the Waste Isolation Pilot Plant, a
deep geologic repository near Carlsbad, New Mexico, designed for
transuranic waste disposal. Idaho National Laboratory plans to ship
160 transuranic waste containers--those containers that because of
their high radioactivity, must be handled remotely--to the Waste
Isolation Pilot Plant.
Figure 3: Workers Packaging Transuranic Waste, Savannah River Site:
[Refer to PDF for image: photograph]
Source: DOE.
[End of figure]
* Supporting the maintenance and treatment of liquid tank waste: for
example, upgrading the infrastructure used to stabilize and maintain
the tanks that store chemical and radioactive waste at the Hanford
Site. Projects funded through the Recovery Act are accelerating
specific upgrades, such as installing new ventilation systems to
prevent the buildup of hazardous and volatile gases produced in the
tanks. The waste is gradually being transferred from the oldest,
deteriorating underground tanks to larger, newer tanks in preparation
for processing in the waste treatment plant, which is expected to
start operating in 2019.
DOE Updated and Validated Cost and Schedule Targets for Recovery Act
Projects:
To implement Recovery Act work, DOE updated (or, for new work,
developed) cost and schedule targets for each project. Once these
targets were established, DOE followed the process established by
order 413.3A for reviewing and assessing the targets' validity and the
reasonableness of the price of the associated contract. Reviews fell
into two general categories:
* Program reviews: Performed by DOE officials with no vested interest
in a project, such reviews are to determine if a project's scope, cost
and schedules, safety, and technology are valid and appropriate.
Program reviews for projects estimated to cost no more than $100
million are known as independent project reviews. Program reviews for
projects estimated to cost $100 million or more are known as external
independent reviews.
* Cost reviews: These reviews verify that the contractors' price
estimates adequately reflect the programs' scope and are reasonable
for the work to be accomplished. Cost reviews for projects valued at
$100,000 or more are known as independent government cost estimates.
Cost reviews for projects valued at $5 million or more are known as
independent reviews and validations.
Both of these categories of reviews serve to highlight any potential
issues or problems with contracts, as well as offer an opportunity for
DOE and its contractors to define and perform any needed corrective
action. For example, the Savannah River Site's external independent
review to assess cost and schedule estimates and readiness to begin
construction found that the contractor had not produced sound cost and
schedule estimates or risk management plans nor clearly defined the
scope of Recovery Act work to decommission certain buildings. The
site's contractor responded with a corrective action plan that spelled
out actions to remedy these shortcomings. Reviews have also found
contracts where information was missing. At Hanford, for example, the
external independent review found that some of the Recovery Act
projects had not fully defined the scope of their work or established
cost and schedule targets at the time of the review. In other cases,
the reviews found contracts that lacked sufficient "contingencies,"
that is, sufficient cushions built into the cost and schedule
estimates in case of unforeseen technical or programmatic problems.
For example, Idaho National Laboratory did not initially include a
contingency estimate in its schedule for the site's Recovery Act
activities. Reviews also uncovered concerns about project
implementation, such as contractors' inability to start work as
quickly as planned. For instance, at the Moab Site, Utah, an initial
program review found that the contractor's procurement office was
unable to acquire needed equipment to operate at full capacity,
slowing work at the site.
In addition, DOE decided to disburse funding for Recovery Act cleanup
projects in phases, requiring site officials to complete a series of
steps before releasing the funds. For example, initial funding--equal
to 30 percent of obligated funds--was released only after sites had
certified that contracts were finalized for the Recovery Act projects.
DOE Has Begun Work on All Projects, Most Appear to Be Meeting Cost and
Schedule Targets, and Spending Overall Has Been Slower Than Planned:
DOE has begun work on all of its Recovery Act projects, spent over
$1.9 billion of its $6 billion in Recovery Act funding, and created
more than 5,600 jobs at the 17 cleanup sites selected for funding. DOE
reported that the majority of Recovery Act projects were achieving
cost and schedule targets, although about one-third were not.[Footnote
11] In addition, inconsistencies exist between some projects' cost and
schedule performance and progress shown by other performance measures,
such cubic meters of soil remediated.
DOE Reported All 84 Recovery Act Projects Are Under Way, Creating
About 5,600 Jobs, but Overall Spending Has Been Slower Than Planned:
Work has begun on each of DOE's 84 Recovery Act cleanup projects and,
as of May 2010, each of the projects was still in progress. The first
project planned for completion--an effort to remove contaminated soil
and groundwater at the Mound Site in Ohio--is scheduled to finish in
September 2010, according to DOE. According to DOE monthly reports,
most of the other 83 projects are expected to be completed by
September 2011, DOE's internal target for completing all Recovery Act
work. DOE's monthly project reports from early 2010 indicated that 20
projects were scheduled for completion after fiscal year 2011,
including 11 of the 14 projects at the Savannah River Site. More
recently, however, DOE headquarters officials said that at least nine
projects would not be completed before the September 2011 deadline.
These projects include:
* a project at Savannah River to clean up transuranic waste, which was
delayed as the site awaited approval to ship its waste to the Waste
Isolation Pilot Plant for permanent disposal, according to DOE;
[Footnote 12]
* a project to demolish a uranium enrichment and processing facility
at the Oak Ridge Reservation, which began late, according to DOE; and;
[Footnote 13]
* a facility-decommissioning project at Idaho National Laboratory,
which was delayed because of technical difficulties.[Footnote 14]
In March 2010, DOE reported that Recovery Act cleanup work had
resulted in more than 5,600 full-time-equivalent jobs at all 17 sites
in 12 states.[Footnote 15] Over 80 percent of these jobs were located
at the four sites--Hanford, Idaho National Laboratory, the Oak Ridge
Reservation, and Savannah River--that together received 80 percent of
Recovery Act funding. The number of full-time jobs created varied from
site to site. For example, DOE reported that 5 jobs were created at
the Energy Technology Engineering Center in California, a 90-acre site
currently engaged in deactivation and decommissioning activities to
clean up the nuclear waste generated during years of nuclear research,
and nearly 1,400 jobs were created at Savannah River, a 310-square-
mile site where a number of DOE cleanup activities are taking place,
including the stabilization, treatment, and disposal of nuclear waste
generated during decades of development and production of nuclear
weapons and materials.
DOE's spending on Recovery Act projects has been slower than the
department had planned. As of May 2010, a little over a year into the
program, DOE had obligated about $5.5 billion (92 percent) of the $6
billion in Recovery Act cleanup funding and had spent about $1.9
billion of those funds--slightly less than the $2.3 billion DOE had
expected to spend through May 2010. Spending rates varied across
sites, from 76 percent of obligated funds spent at the Energy
Technology Engineering Center in California to 23 percent at Argonne
National Laboratory in Illinois. On a project-by-project basis, as of
March 2010, amounts spent ranged from less than 1 percent of total
estimated project cost (a $142 million project to decommission a
reactor at Savannah River[Footnote 16]) to 84 percent of estimated
project cost (a $17 million project to decommission a reactor at
Brookhaven National Laboratory[Footnote 17]). In some cases, according
to DOE officials, the slower spending at a site or on a given project
resulted from technical and management challenges that may have slowed
progress. In other cases, however, DOE had planned to spend less money
early on: for example, DOE estimated slower spending during the first
several months of a project to remediate contaminated soil and
groundwater at Hanford because fewer workers were needed for the
work's first, less complex phase, according to a site official. DOE's
plans for that project show an increase in the rate of spending
Recovery Act funds beginning in May 2010, once excavating the
contaminated soil is under way.[Footnote 18] Table 1 shows Recovery
Act spending on DOE cleanup projects through May 2010. In commenting
on a draft of this report, DOE stated that the initial project spend
plans for the Recovery Act were developed prior to finalizing the
contracts for the work. Now, with the exception of nine projects for
which the scope of work changed, DOE officials expect to spend over 95
percent of project funds by the end of fiscal year 2011.
Table 1: Spending on Recovery Act Cleanup Projects through May 2010:
Dollars in thousands:
Total Recovery Act funds allotted: [Empty].
Site: 1. Argonne National Laboratory (IL);
Total Recovery Act funds allotted: $79,000;
Allotted funds that have been obligated: Amount: $79,000;
Allotted funds that have been obligated: Percentage: 100%;
Allotted funds that have been spent: Amount: $17,843;
Allotted funds that have been spent: Percentage: 23%.
Site: 2. Brookhaven National Laboratory (NY);
Total Recovery Act funds allotted: $61,855;
Allotted funds that have been obligated: Amount: $61,855;
Allotted funds that have been obligated: Percentage: 100%;
Allotted funds that have been spent: Amount: $29,636;
Allotted funds that have been spent: Percentage: 48%.
Site: 3. Energy Technology Engineering Center (CA);
Total Recovery Act funds allotted: $54,175;
Allotted funds that have been obligated: Amount: $54,162;
Allotted funds that have been obligated: Percentage: 100%;
Allotted funds that have been spent: Amount: $41,202;
Allotted funds that have been spent: Percentage: 76%.
Site: 4. Hanford Site (WA): Office of River Protection;
Total Recovery Act funds allotted: $326,035;
Allotted funds that have been obligated: Amount: $325,935;
Allotted funds that have been obligated: Percentage: 100%;
Allotted funds that have been spent: Amount: $85,962;
Allotted funds that have been spent: Percentage: 26%.
Site: 4. Hanford Site (WA): Richland Operations Office;
Total Recovery Act funds allotted: $1,634,500;
Allotted funds that have been obligated: Amount: $1,633,993;
Allotted funds that have been obligated: Percentage: 100%;
Allotted funds that have been spent: Amount: $476,258;
Allotted funds that have been spent: Percentage: 29%.
Site: 5. Idaho National Laboratory (ID);
Total Recovery Act funds allotted: $467,875;
Allotted funds that have been obligated: Amount: $423,775;
Allotted funds that have been obligated: Percentage: 91%;
Allotted funds that have been spent: Amount: $184,126;
Allotted funds that have been spent: Percentage: 39%.
Site: 6. Los Alamos National Laboratory (NM);
Total Recovery Act funds allotted: $211,775;
Allotted funds that have been obligated: Amount: $211,775;
Allotted funds that have been obligated: Percentage: 100%;
Allotted funds that have been spent: Amount: $64,234;
Allotted funds that have been spent: Percentage: 30%.
Site: 7. Moab UMTRA Site (UT);
Total Recovery Act funds allotted: $108,350;
Allotted funds that have been obligated: Amount: $108,350;
Allotted funds that have been obligated: Percentage: 100%;
Allotted funds that have been spent: Amount: $35,654;
Allotted funds that have been spent: Percentage: 33%.
Site: 8. Mound Site (OH);
Total Recovery Act funds allotted: $19,700;
Allotted funds that have been obligated: Amount: $19,700;
Allotted funds that have been obligated: Percentage: 100%;
Allotted funds that have been spent: Amount: $8,975;
Allotted funds that have been spent: Percentage: 46%.
Site: 9. Nevada Test Site (NV);
Total Recovery Act funds allotted: $44,325;
Allotted funds that have been obligated: Amount: $44,300;
Allotted funds that have been obligated: Percentage: 100%;
Allotted funds that have been spent: Amount: $21,795;
Allotted funds that have been spent: Percentage: 49%.
Site: 10. Oak Ridge Reservation (TN);
Total Recovery Act funds allotted: $755,110;
Allotted funds that have been obligated: Amount: $657,563;
Allotted funds that have been obligated: Percentage: 87%;
Allotted funds that have been spent: Amount: $193,340;
Allotted funds that have been spent: Percentage: 26%.
Site: 11. Paducah Site (KY);
Total Recovery Act funds allotted: $80,400;
Allotted funds that have been obligated: Amount: $80,400;
Allotted funds that have been obligated: Percentage: 100%;
Allotted funds that have been spent: Amount: $24,871;
Allotted funds that have been spent: Percentage: 31%.
Site: 12. Portsmouth Site (OH);
Total Recovery Act funds allotted: $119,800;
Allotted funds that have been obligated: Amount: $119,800;
Allotted funds that have been obligated: Percentage: 100%;
Allotted funds that have been spent: Amount: $38,430;
Allotted funds that have been spent: Percentage: 32%.
Site: 13. Savannah River Site (SC);
Total Recovery Act funds allotted: $1,615,400;
Allotted funds that have been obligated: Amount: $1,363,924;
Allotted funds that have been obligated: Percentage: 84%;
Allotted funds that have been spent: Amount: $563,292;
Allotted funds that have been spent: Percentage: 35%.
Site: 14. Separations Process Research Unit (NY);
Total Recovery Act funds allotted: $51,775;
Allotted funds that have been obligated: Amount: $51,775;
Allotted funds that have been obligated: Percentage: 100%;
Allotted funds that have been spent: Amount: $16,202;
Allotted funds that have been spent: Percentage: 31%.
Site: 15. SLAC National Accelerator Laboratory (CA);
Total Recovery Act funds allotted: $7,925;
Allotted funds that have been obligated: Amount: $7,925;
Allotted funds that have been obligated: Percentage: 100%;
Allotted funds that have been spent: Amount: $5,351;
Allotted funds that have been spent: Percentage: 68%.
Site: 16. Waste Isolation Pilot Plant (NM);
Total Recovery Act funds allotted: $172,375;
Allotted funds that have been obligated: Amount: $172,344;
Allotted funds that have been obligated: Percentage: 100%;
Allotted funds that have been spent: Amount: $58,394;
Allotted funds that have been spent: Percentage: 34%.
Site: 17. West Valley Demonstration Project (NY);
Total Recovery Act funds allotted: $73,875;
Allotted funds that have been obligated: Amount: $62,875;
Allotted funds that have been obligated: Percentage: 85%;
Allotted funds that have been spent: Amount: $22,889;
Allotted funds that have been spent: Percentage: 31%.
Site: Other[A];
Total Recovery Act funds allotted: $99,650;
Allotted funds that have been obligated: Amount: $64,237;
Allotted funds that have been obligated: Percentage: 64%;
Allotted funds that have been spent: Amount: $57,177;
Allotted funds that have been spent: Percentage: 57%.
Site: Unapportioned[B];
Total Recovery Act funds allotted: $16,100;
Allotted funds that have been obligated: Amount: 0;
Allotted funds that have been obligated: Percentage: 0;
Allotted funds that have been spent: Amount: N/A;
Allotted funds that have been spent: Percentage: [Empty].
Site: Total;
Total Recovery Act funds allotted: $6,000,000;
Allotted funds that have been obligated: Amount: $5,543,688;
Allotted funds that have been obligated: Percentage: 92%;
Allotted funds that have been spent: Amount: $1,945,629;
Allotted funds that have been spent: Percentage: 32%.
Source: GAO analysis of DOE data.
[A] Includes management costs, as well as DOE's Title X uranium and
thorium reimbursement program funded with Recovery Act dollars.
[B] Refers to money held in reserve by OMB.
[End of table]
A Majority of Recovery Act-Funded Projects Appear to Be Meeting Cost
and Schedule Targets, Although Inconsistencies Exist between Some
Targets and Performance Measures:
A key set of metrics DOE uses to determine whether projects, including
those funded by the Recovery Act, are meeting their cost and schedule
targets comes from DOE contractors' earned value management system.
Earned value is a project management tool that combines measurements
of scope, schedule, and cost in a single integrated system that can be
used by DOE contractors to manage programs.[Footnote 19] According to
DOE headquarters and site officials, DOE monitors this earned value
information monthly from headquarters, as well as weekly or daily at
some sites. Using these data, DOE reported that, as of March 2010, 57
of the 84 Recovery Act projects--about two-thirds--were meeting both
cost and schedule targets. About 20 percent of projects were meeting
either their cost or schedule target, but not both, and the remaining
11 percent had missed both targets altogether. Projects meeting and
missing targets spanned the range of project types, including facility
demolitions, groundwater remediation, and infrastructure upgrades.
Appendix IV provides performance information by project number for
Recovery Act projects.
In addition to tracking earned value metrics, DOE also evaluates
project performance by reviewing project-specific performance
measures. As of March 2010, DOE reported that across the complex,
progress on five of seven selected performance measures was meeting or
exceeding targets (see figure 4). These measures relate to the
specific cleanup activities under way at a given site, such as cubic
meters of waste disposed of or the number of radioactive facilities
decommissioned. Historically, DOE has used such measures to track
cleanup progress complexwide. DOE developed several new performance
measures specific to Recovery Act projects. These include, for
example, cubic meters of transuranic waste that have been prepared and
certified for shipment to the Waste Isolation Pilot Plant, a measure
that supplements existing measures tracking only the amount of
transuranic waste actually disposed of. Some sites have also developed
site-or project-specific cleanup measures, such as the Savannah River
Site, which is measuring cubic yards of grout (a cementlike material)
poured into decommissioned reactor facilities, and the Hanford Site,
which is measuring the number of waste tank systems that are upgraded.
Figure 4: Selected Performance Measures for Environmental Management's
Recovery Act Projects, Reported by DOE, as of March 2010:
[Refer to PDF for image: horizontal bar graph]
Performance measures: Facility square footage demolished (ft2);
Overall goal: 3,144,981;
Target to date: 405,636;
Actual to date: 456,778.
Performance measures: Demolition debris and soil permanently disposed
of (m3);
Overall goal: 1,217,177
Target to date: 381,368;
Actual to date: 277,765.
Performance measures: Mill tailings disposed of (tons);
Overall goal: 2,004,035;
Target to date: 465,155;
Actual to date: 614,295.
Performance measures: Transuranic waste packaged for disposal (m3);
Overall goal: 6,657;
Target to date: 1,799;
Actual to date: 1,928.
Performance measures: Transuranic waste characterized for final
disposal (m3);
Overall goal: 10,045;
Target to date: 1,970;
Actual to date: 1,259.
Performance measures: Transuranic waste permanently disposed of (m3);
Overall goal: 8,398;
Target to date: 744;
Actual to date: 878.
Performance measures: Low-level and mix low-level waste permanently
disposed of (m3);
Overall goal: 72,687;
Target to date: 13,069;
Actual to date: 13,666.
Source: DOE.
Note: Demolition debris and soil permanently disposed of represents a
planning estimate rather than a performance measure, according to DOE.
For Recovery Act projects, DOE's goal is to generate and dispose of
less than the total estimated volume of such debris--1.2 million cubic
meters--shown in the figure.
[End of figure]
While DOE is using performance measures to track progress on most of
its 84 Recovery Act projects, progress on 31 projects has not been
tracked using any performance measures, for two main reasons. First,
18 of the 31 projects do not yet have any corresponding performance
measures assigned. According to a DOE Recovery Act Program official,
performance measures are being developed for most of these 18
projects. Five of the 18 projects will not be assigned any performance
measures, however, because the work does not lend itself to meaningful
performance measures, the work is almost complete, or earned value
data are deemed sufficient to track the projects' progress, according
to DOE. For example, DOE will rely primarily on earned value measures
to track progress on a project to maintain and monitor the physical
condition of inactive facilities at the Savannah River Site.[Footnote
20] Second, the remaining 13 of 31 projects currently have performance
measures assigned for tracking progress, but the planned work
associated with those measures has not begun. For example, for a
particular project at the Hanford Site to identify and dispose of
contaminated soil, the performance measure is cubic meters of soil
disposed of.[Footnote 21] But because work during the project's first
several months involved identifying the extent of the contamination
(before beginning actual excavation of contaminated soil), this
particular performance measure will not be useful for tracking
progress until the first planned disposal of contaminated soil in
October 2010.
For the remaining 53 projects that had performance measures in place
as of March 2010, results were mixed. Of these projects, DOE reported
in its monthly reports that 38 were meeting all their performance
measure targets, and 15 were missing some or all of their targets (see
fig 5). For example, a project at the Savannah River Site to treat and
dispose of several types of solid waste had five performance measures
tracking progress, as of March 2010, including metric tons of depleted
uranium packaged for disposal, number of waste drums disposed of, and
cubic meters of debris and soil disposed of.[Footnote 22] As of March
2010, the project was falling short on three of its five performance
measures. Among other aims, the project was supposed to prepare about
11,600 metric tons of depleted uranium for disposal, but only about
4,000 metric tons had actually been prepared because of a delayed
start on the project, according to site officials.
In reviewing projects' earned value cost and schedule target data and
projects' associated performance measures, we found that the results
as assessed by performance measures were sometimes inconsistent with
the results shown by earned value data for cost and schedule targets.
A given project might have met cost and schedule targets but have
nevertheless fallen short in meeting performance measure targets. For
example, at the Hanford Site, a project to dispose of contaminated
soil and debris met or bettered its cost and schedule targets, but a
related performance measure showed that none of the contaminated
material had been disposed of as planned.[Footnote 23] Conversely,
earned value data for a project to demolish contaminated buildings at
Idaho National Laboratory showed that the project was not meeting its
cost and schedule targets but was meeting all of its performance
measures, such as square footage of facilities demolished.[Footnote
24] In commenting on a draft of this report, DOE officials stated that
earned value scores and other project performance information are
intended to provide complementary insights into overall performance.
Officials said that when differences among the indicators arise,
headquarters officials follow up with federal and contractor officials
at the site to determine the reasons for these differences.
Figure 5: Performance of Recovery Act Projects, as of March 31, 2010:
[Refer to PDF for image: 2 pie-charts]
Projects not meeting both cost and schedule targets: 9 (11%);
Projects meeting either cost or schedule targets (but not both): 18
(21%);
Projects meeting both cost and schedule targets: 57 (68%).
Projects not meeting any performance targets: 4 (5%);
Projects meeting some performance targets, missing others: 11 (13%);
Projects not currently being tracked with performance measures: 31[B]
(37%);
Projects meeting all performance targets: 38[A] (45%).
Source: GAO analysis of DOE data.
[A] DOE considers performance to be meeting targets until it drops
below 90 percent of the target. That is, work could be slightly under
expectations--but not less than 90 percent of the target--and still be
considered as meeting its target.
[B] Some of these projects have performance measures in place, but
those measures did not show any planned work through March 2010.
[End of figure]
DOE Has Taken Steps to Help Address Potential Problems but Continues
to Face Key Challenges in Managing Projects and Measuring Their Impact:
DOE's Recovery Act work is well into its second year, and the
department faces familiar challenges. While DOE has taken steps to
strengthen project management activities, as of March 2010, about one-
third of projects did not achieve cost or schedule targets, or both.
According to DOE officials, many schedule delays and cost problems
could be traced to the same types of issues that have troubled DOE in
the past--technical challenges, regulatory issues, and contracting
delays. In addition, it is unclear how Recovery Act funding has
affected job creation and the department's environmental cleanup goals
or, in particular, to what degree this additional funding will reduce
DOE's footprint, related environmental risks, and future cleanup costs.
DOE Has Taken Steps to Help Projects Achieve Cost and Schedule
Targets, Although Some Project Management Issues Remain:
To help Recovery Act projects achieve their cost and schedule targets,
DOE has taken steps to strengthen project management and oversight,
such as adding federal oversight staff, increasing project reporting
requirements, and placing tighter controls on when and how funds are
disbursed to cleanup sites. First, DOE created a management structure
to oversee Recovery Act projects separately from its cleanup projects
funded by annual appropriations. At the headquarters level, DOE
created an Environmental Management Recovery Act program office, where
experienced DOE staff oversee site reporting and project review
requirements for Recovery Act work. In addition, DOE assigned a
certified on-site federal project director to oversee each Recovery
Act project. All federal project directors for Recovery Act projects
are senior managers certified by the Project Management Career
Development Program Certification Review Board.[Footnote 25] DOE also
created a new position for cleanup sites--a Recovery Act site
representative--who reports project status to DOE's headquarters'
Recovery Act program office and the Office of Environmental
Management's Consolidated Business Center. Recovery Act site
representatives are expected to monitor and report to the Recovery Act
program office on technical, programmatic, regulatory, environmental,
safety and health, and fiscal issues and concerns. The business center
provides project management support, such as assistance in cost
estimating and analysis.
Second, DOE increased oversight via new and more frequent reporting
requirements for Recovery Act work. In addition to reporting the
number of jobs funded by the act, sites report to Environmental
Management's Recovery Act program office--on a monthly, rather than
quarterly, basis--projects' progress toward cost and schedule targets,
as well as progress on performance measures. Sites also are to report
whether contractors are completing certain tasks (milestones) on time,
or whether contractors have missed their targets. Third, DOE has
disbursed Recovery Act funding to sites in phases and required site
officials to complete and document a series of tasks before funding
can be released at each phase. For those cases where a site does not
satisfactorily complete these tasks, DOE officials said they are
prepared to withhold additional funding until the site has complied
with the requirements. For example, one of the requirements for
receiving funding is that a project receives a favorable project
review, which involves an assessment of cost and schedule targets and
project management plans. At the Savannah River Site, because a July
2009 external independent review of a decontamination and decommission
project found that the contractor had failed to produce sound cost and
schedule estimates or risk management plans as required, DOE shifted
$200 million it had intended to allocate to that contractor to a
different project managed by a second contractor at the site. DOE
subsequently implemented corrective actions at the site, including
management changes. DOE has not taken similar steps to increase
oversight of projects within its broader environmental cleanup
program, and it is uncertain how or whether the actions taken to
strengthen project management and oversight of Recovery Act projects
will benefit management of DOE's larger portfolio of cleanup projects.
As of March 2010, nearly one-third of Recovery Act projects were
facing cost or schedule difficulties or both--despite DOE's efforts to
choose low-risk, straightforward, shovel-ready projects for funding
and to increase oversight--and overall spending was somewhat slower
than expected. About halfway through DOE's planned Recovery Act
program, slightly less than one-third of the department's $6 billion
allocation had been spent. Officials attributed these difficulties to
technical, regulatory, safety, and contracting problems--some of the
same issues that have challenged DOE's project management in the past.
For instance:
* Technical challenges: Some Recovery Act projects faced technical
problems, such as the discovery of unanticipated wastes that require
additional time and effort to remediate or an inability to obtain
necessary materials or equipment in a timely manner. For example,
unexpected levels of contamination--discovered after cost and schedule
targets under the Recovery Act had been established--have delayed the
decommissioning and demolition of the former Experimental Breeder
Reactor II (one of 52 nuclear reactors at Idaho National Laboratory).
[Footnote 26] In determining the extent of contamination at the
facility and planning the decommissioning effort, DOE discovered that
a portion of the reactor contained a layer of asbestos insulation
between the reactor's outer steel shell and its inner concrete lining
and that the concrete lining was also filled with asbestos. As of May
2010, according to DOE officials, the contractor had to slow the work
to figure out how to best address this unexpected contamination, and
as a result, this $118 million project is not expected to be completed
by September 2011. At the Savannah River Site, a $304 million project
to accelerate disposal of 5,000 cubic meters of transuranic
waste[Footnote 27] cannot be completed until 2012 because of problems
obtaining the proper containers for shipping the waste to the Waste
Isolation Pilot Plant. When the site could not obtain large containers
in a timely manner, workers instead packaged the waste into smaller
containers--a process that was time-consuming and costly, officials
said. In early June 2010, DOE officials said the Nuclear Regulatory
Commission issued a certification of compliance for the large
containers. According to a Savannah River Site official, the new
containers will enable workers to package the waste more efficiently
and at lower cost. Still, as a result of this delay, the project is
expected to be completed in 2012, later than planned.
* Regulatory issues: Some sites have also faced regulatory issues that
require additional time to address. For example, DOE is working on a
$38 million Recovery Act cleanup project at the Energy Technology
Engineering Center[Footnote 28]--which was once involved in nuclear
reactor development and testing--in partnership with the Environmental
Protection Agency (EPA). Under an interagency agreement between EPA
and DOE, EPA has responsibility for conducting a comprehensive
characterization of radioactivity at the site, in accordance with
Comprehensive Environmental Response, Compensation, and Liability Act
(CERCLA) processes.[Footnote 29] When this CERCLA characterization is
completed, DOE can develop an environmental impact statement and
proceed with facility demolition and groundwater and soil cleanup.
[Footnote 30] According to site officials, however, EPA's
characterization activities are taking longer than expected.
* Safety issues: Safety concerns also affected project progress. For
example, a project at the West Valley Demonstration Project in New
York[Footnote 31] to process transuranic wastes for disposal is not
meeting either cost or schedule expectations, according to site
officials, because of safety issues that have slowed progress. DOE
site officials said that after work started on the project, air
monitors showed that contamination in the work area exceeded allowable
limits. Although the workers were already wearing respirators, the air
monitors' warning prompted site officials to require workers to wear
additional protective gear to complete the work. This additional gear,
which includes bubble suits, is more cumbersome and contributed to
slower-than-expected progress. Nevertheless, DOE expects the $4.2
million effort to be completed by December 2010 as planned.
* Contracting delays: Delays in finalizing new contracts or contract
modifications have also led to cost and schedule difficulties. For
example, three of the four indefinite-delivery/indefinite-quantity
contracts[Footnote 32] at the Oak Ridge site in Tennessee have not
been finalized. (Such contracts constitute standing arrangements for
goods and services and introduce greater flexibility into the
contracting process.) The four projects involve cleaning up
contaminated soil and decontaminating or demolishing excess
facilities, including demolishing a radioisotope development
laboratory, a wooden building originally constructed in the 1940s for
a variety of processing and research activities. Unoccupied since
1998, the dilapidated building contains both radioactive and hazardous
materials. The contract has not been finalized for this project and,
as a result, work cannot begin. Site officials at Oak Ridge
Reservation said that finalizing this type of contract often takes
longer than they expect or plan for. In addition, one of the contracts
for the Oak Ridge site was protested by prospective contractors, also
delaying the projects.
Recovery Act Impact on Job Creation and Environmental Cleanup Goals Is
Unclear:
In reporting the number of jobs created as a result of Recovery Act
spending, DOE has reported three substantially different figures,
which can be confusing and potentially misleading. Also unclear is how
much impact Recovery Act spending will have on the department's
environmental cleanup goals, such as reducing environmental risks from
nuclear and hazardous wastes and long-term costs of maintaining excess
facilities and monitoring stored wastes and contaminated soil and
groundwater.
Determining Impact of Recovery Act Spending on Job Creation Is
Problematic Because DOE Calculates Jobs Created Using Three Different
Methodologies:
DOE has wrestled with calculating and reporting jobs created--a
requirement of the Recovery Act--publicly reporting three vastly
different figures. Recovery Act reporting requirements direct agencies
to count hours worked under a prime contractor--the nonfederal entity
that receives Recovery Act funding directly from the federal
government.[Footnote 33] OMB guidance states that agencies are to
report jobs created as full-time equivalents (FTE) calculated by
totaling the number of hours charged by workers to Recovery Act
projects in a given quarter and dividing the sum by the total number
of work hours representing a full work schedule.
While DOE has used this required figure, it has also chosen to
calculate and publicize two additional figures that represent jobs
created: (1) the sum of both prime contractor and subcontractor FTEs
and (2) the number of people who have charged time to Recovery Act
activities--without regard to the number of hours worked--which DOE
refers to as "head count" or "lives touched." DOE officials stated
that because the department relies largely on subcontractors to carry
out the cleanup work, reporting only prime contractor FTEs
substantially understates the employment impact of DOE's Recovery Act
program. The number of prime contractor FTEs DOE reported to OMB as of
March 2010 was 5,655, while the sum for both prime contractors and
subcontractors for the same period was nearly twice that, at 10,018.
The head count, or number of workers engaged for any length of time in
Recovery Act work, was substantially higher still (see table 2).
Table 2: Number of Recovery Act Cleanup Jobs Created by DOE, as
Calculated According to OMB and DOE Guidance, as of March 31, 2010:
Site: 1. Argonne National Laboratory (IL);
OMB-required calculation (prime contractor FTEs): 93;
DOE's additional calculations: Prime contractor plus subcontractor
FTEs: 129;
DOE's additional calculations: Cumulative head count: 264.
Site: 2. Brookhaven National Laboratory (NY);
OMB-required calculation (prime contractor FTEs): 18;
DOE's additional calculations: Prime contractor plus subcontractor
FTEs: 93;
DOE's additional calculations: Cumulative head count: 172.
Site: 3. Energy Technology Engineering Center (CA);
OMB-required calculation (prime contractor FTEs): 5;
DOE's additional calculations: Prime contractor plus subcontractor
FTEs: 15;
DOE's additional calculations: Cumulative head count: 248.
Site: 4. Hanford Site (WA): Office of River Protection;
OMB-required calculation (prime contractor FTEs): 187;
DOE's additional calculations: Prime contractor plus subcontractor
FTEs: 414;
DOE's additional calculations: Cumulative head count: 1,235.
Site: 4. Hanford Site (WA): Richland Operations Office;
OMB-required calculation (prime contractor FTEs): 1,116;
DOE's additional calculations: Prime contractor plus subcontractor
FTEs: 2,486;
DOE's additional calculations: Cumulative head count: 5,197.
Site: 5. Idaho National Laboratory (ID);
OMB-required calculation (prime contractor FTEs): 760;
DOE's additional calculations: Prime contractor plus subcontractor
FTEs: 786;
DOE's additional calculations: Cumulative head count: 1,902.
Site: 6. Los Alamos National Laboratory (NM);
OMB-required calculation (prime contractor FTEs): 120;
DOE's additional calculations: Prime contractor plus subcontractor
FTEs: 296;
DOE's additional calculations: Cumulative head count: 653.
Site: 7. Moab UMTRA Site(UT);
OMB-required calculation (prime contractor FTEs): 148;
DOE's additional calculations: Prime contractor plus subcontractor
FTEs: 227;
DOE's additional calculations: Cumulative head count: 229.
Site: 8. Mound Site (OH);
OMB-required calculation (prime contractor FTEs): 7;
DOE's additional calculations: Prime contractor plus subcontractor
FTEs: 42;
DOE's additional calculations: Cumulative head count: 50.
Site: 9. Nevada Test Site (NV);
OMB-required calculation (prime contractor FTEs): 67;
DOE's additional calculations: Prime contractor plus subcontractor
FTEs: 110;
DOE's additional calculations: Cumulative head count: 545.
Site: 10. Oak Ridge Reservation (TN);
OMB-required calculation (prime contractor FTEs): 1,141;
DOE's additional calculations: Prime contractor plus subcontractor
FTEs: 1,886;
DOE's additional calculations: Cumulative head count: 3,749.
Site: 11. Paducah Site (KY);
OMB-required calculation (prime contractor FTEs): 165;
DOE's additional calculations: Prime contractor plus subcontractor
FTEs: 253;
DOE's additional calculations: Cumulative head count: 626.
Site: 12. Portsmouth Site (OH);
OMB-required calculation (prime contractor FTEs): 142;
DOE's additional calculations: Prime contractor plus subcontractor
FTEs: 464;
DOE's additional calculations: Cumulative head count: 794.
Site: 13. Savannah River Site (SC);
OMB-required calculation (prime contractor FTEs): 1,389;
DOE's additional calculations: Prime contractor plus subcontractor
FTEs: 2,258;
DOE's additional calculations: Cumulative head count: 3,356.
Site: 14. Separations Process Research Unit (NY);
OMB-required calculation (prime contractor FTEs): 32;
DOE's additional calculations: Prime contractor plus subcontractor
FTEs: 119;
DOE's additional calculations: Cumulative head count: 219.
Site: 15. SLAC National Accelerator Laboratory (CA);
OMB-required calculation (prime contractor FTEs): 32;
DOE's additional calculations: Prime contractor plus subcontractor
FTEs: 42;
DOE's additional calculations: Cumulative head count: 146.
Site: 16. Waste Isolation Pilot Plant (NM);
OMB-required calculation (prime contractor FTEs): 150;
DOE's additional calculations: Prime contractor plus subcontractor
FTEs: 270;
DOE's additional calculations: Cumulative head count: 504.
Site: 17. West Valley Demonstration Project (NY);
OMB-required calculation (prime contractor FTEs): 84;
DOE's additional calculations: Prime contractor plus subcontractor
FTEs: 128;
DOE's additional calculations: Cumulative head count: 377.
Site: Total;
OMB-required calculation (prime contractor FTEs): 5,655;
DOE's additional calculations: Prime contractor plus subcontractor
FTEs: 10,018;
DOE's additional calculations: Cumulative head count: 20,266.
Source: DOE.
[End of table]
DOE's job creation calculations are problematic because they are
confusing and potentially misleading. DOE frequently publicizes all
three figures to represent the employment impact of Recovery Act
funding on communities near DOE cleanup sites, without explaining how
the figures were calculated. But only FTEs for prime contractors are
counted in a manner that can be compared with other federal recipients
of Recovery Act funds. It is this number that DOE reports on the
federal Web site FederalReporting.gov. DOE officials said they had
tried to gain permission from OMB to include subcontractor FTEs in
this official count, but OMB has not changed its guidance. In
commenting on a draft of this report, however, DOE stated that federal
acquisition regulations have changed and, effective with the third
quarter of fiscal year 2010, DOE will report both prime contractor and
subcontractor FTEs. Further, DOE's calculation of head count is
potentially misleading for two reasons. First, counting the number of
people carrying out Recovery Act work, rather than the time they have
actually spent in such work, implies that one person engaged in 2
hours of work per week is equivalent to one person engaged in 40 hours
of work per week. The economic benefits to the worker, however, differ
significantly. Second, the estimate includes a count of those people
who contributed to the manufacture of materials or equipment purchased
by prime contractors and subcontractors to support Recovery Act work,
an estimate that is difficult to verify, according to site officials.
The Impact of Recovery Act Spending on Cleanup and Other Goals Remains
Unclear:
In addition to inconsistencies in how the department measures job
creation, DOE has no clear means of determining how cleanup work
funded by the act will reduce environmental risk, if at all. While a
key departmental goal for the funding is to reduce DOE's footprint, or
area of ongoing cleanup activity, just what this goal entails is
unclear. DOE is using a comprehensive list of existing measures to
assess environmental cleanup performance, including additional
measures developed under its Recovery Act program. Existing measures
include such metrics as amount of hazardous material packaged or
disposed of, number of facilities demolished, number of sites for
which remediation has been completed, and number of sites closed.
Recovery Act project-specific measures are similar to department
measures, although more specific, such as number of groundwater wells
installed or square feet of facilities demolished. These project-
specific performance measures, however, focus on outputs and are not
directly linked to long-term outcomes such as reducing risks. For
example, the performance measures do not indicate what impact
installing groundwater wells or demolishing facilities will have on
reducing risks to human health and the environment. Moreover, the way
progress is measured is sometimes inconsistent, and many projects have
no performance measures established to date. As a result, project-
specific performance measures reveal very little about the outcomes
DOE intends to achieve with Recovery Act funding, in particular, how
DOE will measure the impact that Recovery Act funding will have on the
long-term condition of large tracts of land under DOE management or on
DOE's footprint. Headquarters officials defined footprint reduction as
"physical completion of activities with petition for regulatory
approval to follow." Some federal cleanup site officials, however,
said they were confused by DOE's footprint reduction goal and
uncertain how they are to take credit for having achieved it. For
example, it is not clear whether footprint reduction includes total
square footage of facilities owned by DOE, acres of land surrounding
those facilities and owned or controlled by DOE, contaminated soil and
groundwater beneath the facilities, some combination of all of these
things, or something else entirely. Without a clearly defined and
consistent measure of its footprint, it will be difficult for DOE to
report whether or how Recovery Act funding has affected progress
toward this key DOE cleanup goal.
Furthermore, it is also uncertain how much DOE can expect to save in
life-cycle costs of its environmental cleanup program as a result of
Recovery Act funding. DOE Recovery Act program officials estimated
that as much as $4 billion in life-cycle savings would be realized by
doing the work under Recovery Act funding sooner rather than later, as
originally planned.[Footnote 34] Officials stated that savings are to
be achieved by avoiding costs such as those for long-term maintenance,
security, and waste monitoring. DOE's $4 billion estimate, however,
includes an estimate for savings that could be achieved because of
inflation--by avoiding the higher costs of materials and labor in the
future. In addition, DOE's estimates do not take into account the time
value of money. That is, they do not account for the fact that costs
incurred in the future are worth less than costs incurred sooner.
According to standard economic analysis, OMB guidance on benefit-cost
analysis, as well as DOE's guidance on life-cycle cost analysis, life-
cycle analyses should be based on cost adjusted for both inflation and
the time value of money--that is, on cost in present-value dollars. In
contrast, DOE's comparison of its base program life-cycle cost
estimate and its Recovery Act program estimate is based on current
dollars and does not correct for either the effect of inflation on
prices or the time value of money. Our analysis of DOE's cost savings,
taking the appropriate factors into account, found that DOE's $4
billion savings estimate may be overstated by as much as 80 percent.
GAO has previously taken issue with DOE's method of calculating
savings in life-cycle costs.[Footnote 35] DOE officials have said that
when estimating life-cycle cost savings from Recovery Act work, they
prefer to use current dollars, which take into account increasing
costs due to inflation. An official said that using current dollars
provides for a more direct comparison with DOE's budget submission to
Congress.
Conclusions:
DOE expected that Recovery Act funding would help it achieve several
goals, including accelerating the cleanup effort and reducing the
footprint of facilities and contamination at 17 of its sites, creating
jobs, and reducing total remaining cleanup costs. As the halfway mark
in DOE's Recovery Act work approaches, the department has made
progress toward completing cleanup projects and the majority, although
not all, of these projects appear to be meeting cost and schedule
targets. In carrying out its Recovery Act work, DOE has implemented
additional steps to address familiar contract and project management
challenges, by providing stricter controls over how and when funds are
disbursed to cleanup sites, increasing reporting requirements, and
paying greater attention to project oversight. Although we do not yet
know what effects each of these additional steps to improve project
management and increase oversight of Recovery Act projects will
ultimately have on DOE's ability to meet projects' cost and schedule
targets, some of the steps could be found useful for Recovery Act
cleanup work, as well as carry the potential to be beneficial for
projects funded under annual appropriations. The department has been
less successful in implementing steps to better assess the results of
its Recovery Act work. Specifically, DOE faces challenges in
accurately assessing the effects of Recovery Act spending on job
creation, environmental risk, footprint reduction, and long-term
cleanup costs. Regarding jobs created, OMB requires that job creation
figures be calculated and reported using a standard methodology. DOE,
however, has chosen to also use two additional methodologies to
calculate and publicly report job creation figures, which potentially
provides a misleading picture of actual jobs created. DOE sites also
do not have a means of determining how cleanup funded by the act will
reduce environmental risk, if at all, or how DOE will measure progress
toward its goals for footprint reduction. Further, DOE is not
following OMB's or its own internal guidance in calculating cost
savings that might accrue from completing cleanup projects sooner
using Recovery Act funding. The methodology chosen by the department
appears to significantly overstate savings from Recovery Act spending.
Without clear performance goals and consistent and meaningful
methodologies for measuring outcomes stemming from Recovery Act
spending, it will be difficult for the department or others to
accurately assess the benefits gained from the $6 billion of Recovery
Act funding directed to the department.
Recommendations for Executive Action:
To help ensure successful completion of Recovery Act projects and
apply lessons learned to DOE's larger cleanup effort, we recommend
that the Secretary of Energy direct the Assistant Secretary of
Environmental Management to take the following four actions:
* Determine whether additional project management and oversight steps
adopted for Recovery Act projects, such as more frequent reporting,
have proven beneficial and whether these steps would be effective and
appropriate for DOE's cleanup projects funded under annual
appropriations.
* Clarify the methodology used to calculate any supplemental job
creation figures in addition to prime contractor and subcontractor
FTEs, such as head count--that is workers who have charged any amount
of time to Recovery Act projects--so that users of this information
fully understand what each number represents and its significance and
limitations.
* Develop clear, quantifiable, and consistent measures for determining
the impact of Recovery Act funding on environmental risk. As part of
this effort, clearly define what the DOE footprint consists of,
determine how changes to the footprint will be measured, and ensure
that all DOE sites report changes to their footprint in a consistent
and comparable manner.
* Ensure that savings estimates over the life of the cleanup projects
are calculated according to OMB and DOE guidance, so that these
estimates accurately represent potential savings and reflect costs
adjusted for both inflation and the time value of money.
Agency Comments and Our Evaluation:
We provided a draft of this report to DOE for its review and comment.
In written comments, the Assistant Secretary for Environmental
Management stated that DOE concurred with our four recommendations
contained in the report and indicated that some of the actions we are
recommending have already been taken. Regarding the first
recommendation--to evaluate the effectiveness of additional project
management and oversight steps adopted for Recovery Act projects and
determine if these steps would be effective for projects funded under
annual appropriations--DOE indicated that some steps had been taken.
These include requiring more frequent reviews of projects. DOE stated
it is still evaluating the potential benefit to the base program of
other steps taken to manage Recovery Act projects. In responding to
the second recommendation on the methods used to calculate job
creation figures, DOE stated that a recent change to federal
acquisition regulations, which will result in the reporting of both
prime contractor and subcontractor jobs in FederalReporting.gov, will
negate GAO's concern on the matter. Our concern, however, centered on
ensuring that users of DOE's three job creation figures--prime
contractor FTEs, prime contractor and subcontractor FTEs, and head
count--understand exactly what the figures represent. The head count
figure is not reported into FederalReporting.gov and, as we note in
our report, was a significantly higher figure than prime contractor or
subcontractor job figures. In its detailed comments, DOE stated that
it has posted guidance on its Web site regarding the methodologies
used to calculate job creation figures and will also include a one-
page explanation sheet with job numbers presented to stakeholders or
the public. We have reworded this recommendation to enhance its
clarity. Third, DOE stated that it agreed with GAO's recommendation to
have clear, quantifiable, and consistent measures of footprint
reduction and has taken steps to better define this concept and
communicate the definition to all its sites. While we agree that DOE
has made progress on defining footprint reduction, the focus of our
recommendation was broader, emphasizing the development of clear,
quantifiable, and consistent measures for determining the impact of
Recovery Act funding on environmental risk. While we recognize that
DOE collects information related to project risks, as it stated in its
response, the information collected concerns risks associated with
successfully carrying out a project, not quantifying the reduction in
environmental risks themselves. DOE went on to point out that its
performance measures are focused on outputs that are directly tied to
cleanup of the site. Outputs, such as cubic meters of soil remediated,
do provide a measure of work performed, but they may not easily
translate into the outcome in terms of environmental risk reduction
due to Recovery Act funds spent at each site. We maintain that DOE
needs to continue to develop measures for determining the impact of
Recovery Act funding on reducing environmental risks. DOE also
expressed concern over the method we used to determine project
performance, as well as our assessment that inconsistencies exist
between some projects' cost and schedule performance and other
measures. We modified the draft to address these concerns. In
responding to our recommendation on calculating life-cycle cost
savings, DOE agreed stating that it is currently following OMB and DOE
guidance. As we noted in our report, however, the $4 billion in
savings that DOE has stated will result from Recovery Act projects
could be overstated by as much as 80 percent because the calculation
does not take into account the time value of money and inflation.
DOE's written comments are presented in appendix V. In addition, DOE
provided detailed technical comments, which we incorporated as
appropriate.
We are sending copies of this report to the appropriate congressional
committees, the Secretary of Energy, and other interested parties. The
report is also available at no charge on the GAO Web site at
[hyperlink, http://www.gao.gov].
If you or your staff members have any questions regarding this report,
please contact me at (202) 512-3841 or aloisee@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 VI.
Signed by:
Gene Aloise:
Director, Natural Resources and Environment:
[End of section]
Appendix I: Scope and Methodology:
To determine how the Department of Energy (DOE) selected projects for
funding under the American Recovery and Reinvestment Act of 2009
(Recovery Act) and developed cost, schedule, and performance targets,
we reviewed key provisions of the Recovery Act and Office of
Management and Budget (OMB) guidance regarding the act. We also
reviewed various DOE guidance documents regarding project management
and project reviews (orders 413.3A, 413.3-8 and 413.3-9), cost-
estimating procedures (order 430.1-1), and the use of earned value
management techniques (order 413.3-10). In addition, we reviewed key
project planning and management documents. These included project
operating plans, DOE assessments of project cost and schedule targets,
and earned value management system certifications. We also reviewed
OMB and DOE guidance on collecting and reporting data on jobs created
and DOE's most recent performance accountability annual reports. To
gain a better understanding of how projects were selected and the
steps officials took to develop cost and schedule targets, we
interviewed DOE headquarters officials and officials at each of the 17
sites receiving Recovery Act funding--once after initial project
implementation, and again several months later. We visited the four
DOE cleanup sites receiving the bulk of the $6 billion in Recovery Act
funding for environmental cleanup: (1) the Hanford Site, (2) Idaho
National Laboratory, (3) the Oak Ridge Reservation, and (4) the
Savannah River Site. For each site, we reviewed project documentation,
interviewed officials, and observed Recovery Act work under way. We
also selected a nonrandom sample of four of the costliest projects--
including soil and groundwater remediation, facility demolition, and
disposal of waste--to better understand how the cost estimates were
developed and to assess the reliability of the estimates for these
projects. Two projects were at the Hanford Site and two at the
Savannah River Site. Further information on the four projects appears
in appendix II.
To determine the status of the Recovery Act projects and the extent to
which projects are achieving cost and schedule targets and performance
measures, we used contractor data submitted to the Office of
Environmental Management and assembled under its integrated planning,
accounting, and budgeting system. Information we reviewed from this
database consisted of cost and schedule targets; monthly cost and
schedule performance; earned value management system data; and key
agencywide, site, and project performance metrics. To assess the
reliability of data we reviewed, we sent out questionnaires to DOE
headquarters and site officials regarding the steps taken to ensure
the accuracy of data related to measuring progress in meeting project
cost and schedule targets, jobs created, and other project outcomes.
Although in a few instances we found data of questionable reliability
at some of the sites, we determined that, overall, these data were
sufficiently reliable for the purposes of our report.
To determine what key challenges DOE faced and the steps officials
have taken to address these challenges, we reviewed independent
internal and external project reviews, program reviews, and corrective
action plans. We attended an April 2010 Environmental Management
conference at which site officials exchanged information on their
experiences implementing Recovery Act cleanup projects. We reviewed
DOE Office of Inspector General reports on the Recovery Act and
conferred with Inspector General staff. We interviewed headquarters
officials and officials at all 17 sites and reviewed responses to the
data reliability questionnaires sent to and completed by contractor
and federal project management officials for all 84 projects. To
recalculate the life-cycle cost savings that would result from the
Recovery Act, we obtained DOE's life-cycle cost estimates for each
project before and after the Recovery Act. We converted these
estimates to constant dollars using the appropriate inflation factors
for each project provided to us by DOE. We then converted those
estimates to present value using real discount rates from OMB. For
each project, we used the discount rate for the time period that most
closely corresponded with the length of the project under
consideration.
We conducted this performance audit from June 2009 to July 2010, in
accordance with generally accepted government auditing standards.
Those standards require that we plan and perform the audit to obtain
sufficient, appropriate evidence to provide a reasonable basis for our
findings and conclusions based on our audit objectives. We believe
that the evidence obtained provides a reasonable basis for our
findings and conclusions based on our audit objectives.
[End of section]
Appendix II: Description of Four Projects Reviewed in Depth:
We selected four Recovery Act projects for an in-depth review of their
cost and schedule estimates and the reliability of these estimates.
These projects came from the list of projects funded at the two DOE's
sites receiving the most Recovery Act funding--the Hanford and
Savannah River sites.
Hanford:
DOE's Hanford Site in southeastern Washington State was established in
1943 to produce nuclear materials for the nation's defense. Although
DOE stopped producing nuclear material at Hanford in 1989, millions of
gallons of high-level radioactive waste from production still remain
on site. The primary mission at Hanford is site cleanup, including
waste removal and containment and soil and groundwater remediation to
protect the nearby Columbia River. The Richland Operations Office at
the Hanford Site received $1.6 billion from the Recovery Act for
cleanup activities and is funding 10 projects.[Footnote 36] The
projects are to demolish nuclear and support facilities, clean up
waste sites and contaminated groundwater, and retrieve solid waste
from burial grounds. Recovery Act funding to accelerate cleanup of
facilities, waste sites, and groundwater along the Columbia River will
help the site decrease its active area of cleanup from 586 to 75
square miles or less by 2015, which is more than 5 years ahead of the
current schedule. We selected the following two Hanford projects for
in-depth cost and schedule reliability review:
* U Plant D&D:[Footnote 37] The U Plant is a former processing
facility on the site's Central Plateau, where special nuclear
materials were recovered and converted for shipment to other sites for
weapons manufacture and assembly. Plant facilities were built in 1944
and operated until 1964. Other than minor decontamination work, the
facility has been unused and deserted since operations ceased. The
Recovery Act project's scope includes preparing the U Plant for
decommissioning by clearing the facility of equipment and grouting the
reactor's cells, as well as deactivating, decommissioning,
decontaminating, and demolishing 16 ancillary facilities. The project
is expected to be completed by September 2011, at a cost of $257
million.
* 100 K Area remediation:[Footnote 38] The 100 K Area comprises two
former plutonium production reactors along the Columbia River. None of
the reactors is still operational, and contamination from the former
production processes and facilities is a key cleanup objective. The
scope of this Recovery Act project includes decontaminating and
demolishing 30 industrial and radiological facilities associated with
the reactors within the 100 K area, as well as cleaning up or
characterizing 23 waste sites. The project is expected to be completed
by September 2011, at a cost of $203 million.
On the basis of our in-depth reviews, DOE partially met industry best
practices for ensuring that the estimates were accurate,
comprehensive, well documented, and credible as detailed in GAO cost
estimating guide.[Footnote 39] While DOE carried out many best
practices for developing its estimates, in some instances, it did not.
For example, when preparing estimates for both of these projects, DOE
did not create a plan to ensure that the estimates were developed by
people with expertise in cost and schedule estimating and did not test
the reasonableness of its estimates against known costs for similar
activities.
Savannah River:
The Savannah River Site was constructed in the early 1950s to produce
tritium and plutonium for use in nuclear weapons. Historically the
site has supported five nuclear reactors, two chemical separation
plants, a heavy-water extraction plant, a nuclear fuel and target
fabrication facility, a tritium extraction facility, and waste
management facilities. Although the site no longer produces plutonium,
some of its missions continue, such as the extraction of tritium for
nuclear warheads. The site received $1.6 billion under the Recovery
Act, which is funding 14 projects. Overall, Recovery Act projects at
Savannah River are expected to accelerate transuranic waste disposal
by 4 years, and the decommissioning of the nuclear facilities by at
least 5 years. We selected two of Savannah River's Recovery Act
projects for in-depth cost and schedule estimate and reliability
review:
* Accelerated transuranic waste disposition:[Footnote 40] The purpose
of this project is to accelerate the characterization, packaging, and
disposal of 4,200 cubic meters of transuranic waste from the site's
former production of nuclear weapons. The waste will then be shipped
to DOE's Waste Isolation Pilot Plant for permanent disposal. In
addition, the project's current scope includes repackaging of 800
cubic meters of transuranic waste into smaller containers in
preparation for shipment. The project is expected to be completed in
September 2012, at a cost of $304 million.[Footnote 41]
* P&R Area completion general plant projects and operations:[Footnote
42] "P&R Area" refers to the P and R reactors, two of the site's first
nuclear production reactors, which started operating in 1953 and 1954,
respectively. The buildings and associated infrastructure, such as
railroad tracks used to transfer radioactive material from the
reactors to other site facilities, have remained unused since the
facilities ceased operations in 1964 (R reactor) and 1988 (P reactor).
The scope of the Recovery Act project includes decommissioning the two
reactors, as well as removing the railroad tracks. The project also
includes remediation of contaminated soil under the tracks. The
project is expected to advance completion of the P and R area cleanup
by 5 to 6 years.
On the basis of our in-depth reviews of these two projects, DOE
partially met best practices for ensuring that the estimates were
credible, comprehensive, and well documented and minimally met best
practices associated with ensuring that the estimates were accurate.
For example, DOE did not compare its cost and schedule estimates to an
independent cost estimate, a step that helps ensure accuracy. Instead,
the department relied on internal project reviews, which were not as
rigorous.
[End of section]
Appendix III: Recovery Act Project Cost Data through March 2010:
Dollars in thousands:
Argonne National Laboratory (IL):
Project number: 1. CH-ANLE-0040.NEW.R1.1;
Project description: D&D:[B] Building 310;
Total estimated project cost[A]: $14,017;
Cumulative spent (percentage of total cost): $1,602 (11%).
Project number: 2. CH-ANLE-0040.NEW.R1.2;
Project description: D&D: Building 330;
Total estimated project cost[A]: $34,200;
Cumulative spent (percentage of total cost): $2,459 (7%).
Project number: 3. CH-ANLE-0040.NEW.R1.3;
Project description: D&D: Alpha-Gamma Hot Cell Facility;
Total estimated project cost[A]: $26,482;
Cumulative spent (percentage of total cost): $4,042 (15%).
Project number: 4. CH-ANLE-0040.NEW.R1.4;
Project description: TRU[C] waste processing;
Total estimated project cost[A]: $23,567;
Cumulative spent (percentage of total cost): $7,458 (32%).
Argonne National Laboratory (IL): Total;
Total estimated project cost[A]: $98,266;
Cumulative spent (percentage of total cost): $15,561 (16%).
Brookhaven National Laboratory (NY):
Project number: 5. BRNL-0040.R1;
Project description: D&D: Brookhaven Graphite Research Reactor;
Total estimated project cost[A]: $17,208;
Cumulative spent (percentage of total cost): $14,378 (84%).
Project number: 6. BRNL-0041.R1;
Project description: D&D: High Flux Beam Reactor;
Total estimated project cost[A]: $20,932;
Cumulative spent (percentage of total cost): 8,842 $(42%).
Project number: 7. BRNL-0041.NEW.R1;
Project description: D&D: High Flux Beam Reactor;
Total estimated project cost[A]: $4,215;
Cumulative spent (percentage of total cost): $3,469 (82%).
Brookhaven National Laboratory (NY): Total;
Total estimated project cost[A]: $42,355;
Cumulative spent (percentage of total cost): $26,689 (63%).
Energy Technology Engineering Center (CA):
Project number: 8. CBC-ETEC-0040.R1.1;
Project description: D&D: EPA radiological characterization;
Total estimated project cost[A]: $38,300;
Cumulative spent (percentage of total cost): $2,775 (7%).
Project number: 9. CBC-ETEC-0040.R1.2;
Project description: Soil and groundwater cleanup;
Total estimated project cost[A]: $15,875;
Cumulative spent (percentage of total cost): $3,332 (21%).
Energy Technology Engineering Center (CA): Total;
Total estimated project cost[A]: 54,175;
Cumulative spent (percentage of total cost): 6,107 (11%).
Hanford Site: Office of River Protection (WA):
Project number: 10. ORP-0014.R1.1;
Project description: Tank waste support: Tank farm infrastructure
upgrades;
Total estimated project cost[A]: $100,983;
Cumulative spent (percentage of total cost): $20,968 (21%).
Project number: 11. ORP-0014.R1.2;
Project description: Tank waste support: Other infrastructure upgrades;
Total estimated project cost[A]: $26,089;
Cumulative spent (percentage of total cost): $3,473 (13%).
Project number: 12. ORP-0014.R1.3;
Project description: Tank waste support: Facility upgrades;
Total estimated project cost[A]: $92,786;
Cumulative spent (percentage of total cost): $13,808 (15%).
Project number: 13. ORP-0014.R1.4;
Project description: Tank waste support: Waste feed infrastructure
upgrades;
Total estimated project cost[A]: $62,351;
Cumulative spent (percentage of total cost): $9,093 (15%).
Project number: 14. ORP-0014.R1.5;
Project description: Tank waste support: SY transfer line upgrade;
Total estimated project cost[A]: $17,900;
Cumulative spent (percentage of total cost): $988 (6%).
Hanford Site: Office of River Protection (WA): Total;
Total estimated project cost[A]: $300,109;
Cumulative spent (percentage of total cost): $48,330 (16%).
Hanford Site: Richland Operations Office (WA):
Project number: 15. RL-0011.R1;
Project description: D&D: Plutonium Finishing Plant;
Total estimated project cost[A]: $330,200;
Cumulative spent (percentage of total cost): $79,470 (24%).
Project number: 16. RL-0013C.R1.1;
Project description: Solid waste disposal: Mixed low-level waste
treatment;
Total estimated project cost[A]: $50,389;
Cumulative spent (percentage of total cost): $20,873 (41%).
Project number: 17. RL-0013C.R1.2;
Project description: TRU waste processing;
Total estimated project cost[A]: $178,110;
Cumulative spent (percentage of total cost): $57,159 (32%).
Project number: 18. RL-0030.R1;
Project description: Soil and groundwater cleanup: Treatment and
monitoring;
Total estimated project cost[A]: $145,771;
Cumulative spent (percentage of total cost): $44,267 (30%).
Project number: 19. RL-0040.R1.1;
Project description: D&D: U Plant/other;
Total estimated project cost[A]: $256,500;
Cumulative spent (percentage of total cost): v70,579 (28%).
Project number: 20. RL-0040.R1.2;
Project description: D&D: Outer Zone;
Total estimated project cost[A]: $114,900;
Cumulative spent (percentage of total cost): $15,222 (13%).
Project number: 21. RL-0041.R1.1;
Project description: D&D: 100 K Area;
Total estimated project cost[A]: $266,417;
Cumulative spent (percentage of total cost): $44,293 (17%).
Project number: 22. RL-0041.R1.2;
Project description: D&D: Disposal facility expansion;
Total estimated project cost[A]: $36,683;
Cumulative spent (percentage of total cost): $25,412 (69%).
Project number: 23. RL-0041.R1.3;
Project description: D&D: Remedial action/footprint reduction;
Total estimated project cost[A]: $139,117;
Cumulative spent (percentage of total cost): $7,896 (6%).
Project number: 24. RL-0041.R2;
Project description: D&D: 618-10 burial grounds;
Total estimated project cost[A]: $77,814;
Cumulative spent (percentage of total cost): $11,345 (15%).
Hanford Site: Richland Operations Office (WA): Total;
Total estimated project cost[A]: 1,595,901;
Cumulative spent (percentage of total cost): 376,516 (24%).
Idaho National Laboratory (ID):
Project number: 25. ID-0013.R1;
Project description: TRU waste processing;
Total estimated project cost[A]: $30,000;
Cumulative spent (percentage of total cost): $16,935 (56%).
Project number: 26. ID-0013.NEW.R1;
Project description: TRU waste processing;
Total estimated project cost[A]: $100,000;
Cumulative spent (percentage of total cost): $39,501 (40%).
Project number: 27. ID-0030B.R1.1;
Project description: Soil and groundwater cleanup: Buried waste;
Total estimated project cost[A]: $75,428;
Cumulative spent (percentage of total cost): $13,860 (18%).
Project number: 28. ID-0030B.R1.2;
Project description: Soil and groundwater cleanup: In-situ grouting;
Total estimated project cost[A]: $22,666;
Cumulative spent (percentage of total cost): $1,693 (7%).
Project number: 29. ID-0030B.R1.3;
Project description: Soil and groundwater cleanup: Operations;
Total estimated project cost[A]: $21,900;
Cumulative spent (percentage of total cost): $17,520 (80%).
Project number: 30. ID-0040B.R1.1;
Project description: D&D: 39 facilities;
Total estimated project cost[A]: $47,969;
Cumulative spent (percentage of total cost): $30,314 (63%).
Project number: 31. ID-0040B.R1.2;
Project description: D&D: 29 facilities;
Total estimated project cost[A]: v53,481;
Cumulative spent (percentage of total cost): $18,518 (35%).
Project number: 32. ID-0040B.NEW.R1.3;
Project description: D&D: Nuclear Energy facilities;
Total estimated project cost[A]: $118,061;
Cumulative spent (percentage of total cost): $21,110 (18%).
Idaho National Laboratory (ID): Total;
Total estimated project cost[A]: $469,505;
Cumulative spent (percentage of total cost): $159,451 (34%).
Los Alamos National Laboratory (NM):
Project number: 33. VL-LANL-0030.R1.1;
Project description: Soil and groundwater cleanup: Material Disposal
Area B;
Total estimated project cost[A]: $93,988;
Cumulative spent (percentage of total cost): $17,820 (19%).
Project number: 34. VL-LANL-0030.R1.2;
Project description: Soil and groundwater cleanup: Groundwater wells;
Total estimated project cost[A]: $44,977;
Cumulative spent (percentage of total cost): $16,272 (36%).
Project number: 35. VL-LANL-0040-D.R1;
Project description: D&D: Defense-related facilities;
Total estimated project cost[A]: $58,022;
Cumulative spent (percentage of total cost): $11,681 (20%).
Project number: 36. VL-LANL-0040-N.R1;
Project description: D&D: Nondefense-related facilities;
Total estimated project cost[A]: $14,775;
Cumulative spent (percentage of total cost): $4,315 (29%).
Los Alamos National Laboratory (NM): Total;
Total estimated project cost[A]: $211,762;
Cumulative spent (percentage of total cost): $50,088 (24%).
Moab UMTRA Site (UT):
Project number: 37. CBC-MOAB-0031.R1;
Project description: Soil and groundwater cleanup: Mill tailings;
Total estimated project cost[A]: $108,350;
Cumulative spent (percentage of total cost): $38,214 (35%).
Moab UMTRA Site (UT): Total;
Total estimated project cost[A]: 108,350;
Cumulative spent (percentage of total cost): 38,214 (35%).
Mound Site (OH):
Project number: 38. OH-MB-0031.NEW.R1;
Project description: Soil and groundwater cleanup: Operable Unit 1;
Total estimated project cost[A]: $19,700;
Cumulative spent (percentage of total cost): $9,242 (47%).
Mound Site (OH): Total;
Total estimated project cost[A]: $19,700;
Cumulative spent (percentage of total cost): $9,242 (47%).
Nevada Test Site (NV):
Project number: 39. VL-NV-0030.R1;
Project description: Soil and groundwater cleanup;
Total estimated project cost[A]: $45,069;
Cumulative spent (percentage of total cost): $20,024 (44%).
Nevada Test Site (NV): Total;
Total estimated project cost[A]: $45,069;
Cumulative spent (percentage of total cost): $20,024 (44%).
Oak Ridge Reservation (TN):
Project number: 40. OR-0013B.R1.1;
Project description: TRU waste processing;
Total estimated project cost[A]: $124,500;
Cumulative spent (percentage of total cost): $31,578 (25%).
Project number: 41. OR-0040.R1;
Project description: D&D: East Tennessee Technology Park;
Total estimated project cost[A]: v118,000;
Cumulative spent (percentage of total cost): $18,885 (16%).
Project number: 42. OR-0041.R1.1;
Project description: D&D: Y-12 facility;
Total estimated project cost[A]: $5,000;
Cumulative spent (percentage of total cost): $2,417 (48%).
Project number: 43. OR-0041.R1.2;
Project description: D&D: Y-12 remediation preparation;
Total estimated project cost[A]: $43,000;
Cumulative spent (percentage of total cost): $14,326 (33%).
Project number: 44. OR-0041.R1.3;
Project description: D&D: Disposal facility expansion;
Total estimated project cost[A]: $45,000;
Cumulative spent (percentage of total cost): $16,026 (36%).
Project number: 45. OR-0041.NEW.R1.1;
Project description: D&D: Y-12 excess material;
Total estimated project cost[A]: $147,000;
Cumulative spent (percentage of total cost): $41,025 (28%).
Project number: 46. OR-0041.NEW.R1.2;
Project description: D&D: Y-12 biology complex;
Total estimated project cost[A]: $29,853;
Cumulative spent (percentage of total cost): $7,224 (24%).
Project number: 47. OR-0041.NEW.R1.3;
Project description: D&D: Y-12 9206 filter house;
Total estimated project cost[A]: $7,000;
Cumulative spent (percentage of total cost): $3,503 (50%).
Project number: 48. OR-0042.R1.1;
Project description: D&D: Defense legacy material removal;
Total estimated project cost[A]: $10,450;
Cumulative spent (percentage of total cost): $170 (2%).
Project number: 49. OR-0042.R1.2;
Project description: D&D: Defense facility demolition;
Total estimated project cost[A]: $38,922;
Cumulative spent (percentage of total cost): $12,366 (32%).
Project number: 50. OR-0042.R1.3;
Project description: D&D: Defense remedial actions;
Total estimated project cost[A]: $83,100;
Cumulative spent (percentage of total cost): $7,868 (9%).
Project number: 51. OR-0042.NEW.R2.1;
Project description: D&D: Nondefense legacy material removal;
Total estimated project cost[A]: $35,769;
Cumulative spent (percentage of total cost): $649 (2%).
Project number: 52. OR-0042.NEW.R2.2;
Project description: D&D: 2000 complex;
Total estimated project cost[A]: $12,968;
Cumulative spent (percentage of total cost): v4,968 (38%).
Project number: 53. OR-0042.NEW.R2.3;
Project description: D&D: Misc. facility demolition;
Total estimated project cost[A]: $22,000;
Cumulative spent (percentage of total cost): $3,493 (16%).
Oak Ridge Reservation (TN): Total;
Total estimated project cost[A]: $722,562;
Cumulative spent (percentage of total cost): $164,498 (23%).
Paducah Site (KY):
Project number: 54. PA-0040.R1.1;
Project description: D&D: C-410;
Total estimated project cost[A]: $11,040;
Cumulative spent (percentage of total cost): $3,001 (27%).
Project number: 55. PA-0040.R1.2;
Project description: D&D: C-340;
Total estimated project cost[A]: $36,301;
Cumulative spent (percentage of total cost): $8,319 (23%).
Project number: 56. PA-0040.R1.3;
Project description: D&D: C-746-A;
Total estimated project cost[A]: $31,500;
Cumulative spent (percentage of total cost): $9,212 (29%).
Paducah Site (KY): Total;
Total estimated project cost[A]: $78,841;
Cumulative spent (percentage of total cost): $20,532 (26%).
Portsmouth Site (OH):
Project number: 57. PO-0013.R1;
Project description: Solid waste disposal: UMC disposition;
Total estimated project cost[A]: $15,700;
Cumulative spent (percentage of total cost): $4,767 (30%).
Project number: 58. PO-0040.R1.1;
Project description: D&D: X-701B plume remediation;
Total estimated project cost[A]: $48,600;
Cumulative spent (percentage of total cost): $15,191 (31%).
Project number: 59. PO-0040.R1.2;
Project description: D&D: X-533;
Total estimated project cost[A]: $20,600;
Cumulative spent (percentage of total cost): $5,456 (26%).
Project number: 60. PO-0040.R1.3;
Project description: D&D: X-633;
Total estimated project cost[A]: $17,400;
Cumulative spent (percentage of total cost): $6,381 (37%).
Project number: 61. PO-0040.R1.4;
Project description: D&D: X-760;
Total estimated project cost[A]: 15,900;
Cumulative spent (percentage of total cost): 2,282 (14%).
Portsmouth Site (OH): Total;
Total estimated project cost[A]: $118,200;
Cumulative spent (percentage of total cost): $34,077 (29%).
Savannah River Site (SC):
Project number: 62. SR-0011C.R1.1;
Project description: TRU waste processing: Canyon complex support;
Total estimated project cost[A]: $33,974;
Cumulative spent (percentage of total cost): $25,692 (76%).
Project number: 63. SR-0013.R1.1;
Project description: Solid waste disposal;
Total estimated project cost[A]: $324,469;
Cumulative spent (percentage of total cost): $167,678 (52%).
Project number: 64. SR-0013.R1.2;
Project description: TRU waste processing;
Total estimated project cost[A]: $303,596;
Cumulative spent (percentage of total cost): $82,830 (27%).
Project number: 65. SR-0014C.R1.1;
Project description: Tank waste support: Waste systems
recapitalization;
Total estimated project cost[A]: $174,000;
Cumulative spent (percentage of total cost): $24,958 (14%).
Project number: 66. SR-0014C.R1.PEN;
Project description: Tank waste support: Contractor pension payment;
Total estimated project cost[A]: $26,000;
Cumulative spent (percentage of total cost): $4,919 (19%).
Project number: 67. SR-0030.R1.1;
Project description: D&D: P and R Area completion;
Total estimated project cost[A]: $165,490;
Cumulative spent (percentage of total cost): $85,393 (52%).
Project number: 68. SR-0030.R1.2;
Project description: D&D: P reactor;
Total estimated project cost[A]: $142,200;
Cumulative spent (percentage of total cost): $1,052 (1%).
Project number: 69. SR-0030.R1.3;
Project description: D&D: P ash basin;
Total estimated project cost[A]: $30,000;
Cumulative spent (percentage of total cost): $5,188 (17%).
Project number: 70. SR-0030.R1.4;
Project description: D&D: R reactor;
Total estimated project cost[A]: $149,200;
Cumulative spent (percentage of total cost): $3,727 (2%).
Project number: 71. SR-0030.R1.5;
Project description: D&D: R ash basin;
Total estimated project cost[A]: $11,800;
Cumulative spent (percentage of total cost): v3,668 (31%).
Project number: 72. SR-0030.R2.1;
Project description: D&D: M and D Area completion;
Total estimated project cost[A]: v17,070;
Cumulative spent (percentage of total cost): $8,255 (48%).
Project number: 73. SR-0030.R3.1;
Project description: D&D: Sitewide completion;
Total estimated project cost[A]: $220,704;
Cumulative spent (percentage of total cost): $94,260 (43%).
Project number: 74. SR-0030.R3.2;
Project description: D&D: Test reactor decommissioning;
Total estimated project cost[A]: $10,720;
Cumulative spent (percentage of total cost): $708 (7%).
Project number: 75. SR-0040.R1.1;
Project description: D&D: Surveillance and maintenance;
Total estimated project cost[A]: $5,846;
Cumulative spent (percentage of total cost): $2,567 (44%).
Savannah River Site (SC): Total;
Total estimated project cost[A]: $1,615,069;
Cumulative spent (percentage of total cost): $510,895 (32%).
Separations Process Research Unit (NY):
Project number: 76. VL-SPRU-0040.R1.1;
Project description: D&D: Building G2 and H2;
Total estimated project cost[A]: $37,000;
Cumulative spent (percentage of total cost): $13,274 (36%).
Project number: 77. VL-SPRU-0040.R1.2;
Project description: D&D: Contaminated soil removal, North Field;
Total estimated project cost[A]: v14,775;
Cumulative spent (percentage of total cost): $4,829 (33%).
Separations Process Research Unit (NY): Total;
Total estimated project cost[A]: $51,775;
Cumulative spent (percentage of total cost): $18,103 (35%).
SLAC National Accelerator Laboratory (CA):
Project number: 78. CBC-SLAC-0030.R1;
Project description: Soil and groundwater cleanup;
Total estimated project cost[A]: $7,925;
Cumulative spent (percentage of total cost): $5,225 (66%).
SLAC National Accelerator Laboratory (CA): Total;
Total estimated project cost[A]: $7,925;
Cumulative spent (percentage of total cost): $5,225 (66%).
Waste Isolation Pilot Plant (NM):
Project number: 79. CB-0080.R1;
Project description: Operate waste disposal facility;
Total estimated project cost[A]: $53,287;
Cumulative spent (percentage of total cost): $17,953 (34%).
Project number: 80. CB-0081.R1;
Project description: Waste characterization;
Total estimated project cost[A]: $102,868;
Cumulative spent (percentage of total cost): $31,660 (31%).
Project number: 81. CB-0090.R1;
Project description: TRU waste processing;
Total estimated project cost[A]: $16,200;
Cumulative spent (percentage of total cost): $2,248 (14%).
Waste Isolation Pilot Plant (NM): Total;
Total estimated project cost[A]: $172,355;
Cumulative spent (percentage of total cost): $51,861 (30%).
West Valley Demonstration Project (NY):
Project number: 82. OH-WV-0013.R1;
Project description: TRU waste processing;
Total estimated project cost[A]: $4,200;
Cumulative spent (percentage of total cost): $2,234 (53%).
Project number: 83. OH-WV-0040.R1.1;
Project description: D&D: Main plant;
Total estimated project cost[A]: $42,400;
Cumulative spent (percentage of total cost): $11,802 (28%).
Project number: 84. OH-WV-0040.R1.2;
Project description: D&D: Other facilities;
Total estimated project cost[A]: $27,300;
Cumulative spent (percentage of total cost): $7,961 (29%).
West Valley Demonstration Project (NY): Total;
Total estimated project cost[A]: $73,900;
Cumulative spent (percentage of total cost): $21,997 (30%).
Complexwide total;
Total estimated project cost[A]: $5,785,819;
Cumulative spent (percentage of total cost): $1,577,410 (27%).
[End of table]
[A] Total estimated and cumulative project cost does not generally
include contractor fee, management reserve, or contingency funds. As a
result, these totals may not equal the amounts of Recovery Act funds
allocated and costed overall to each site.
[B] D&D = deactivation, decommissioning, decontamination, demolition,
or a combination of these activities.
[C] TRU = transuranic.
Source: GAO analysis of DOE data.
[End of section]
Appendix IV: Recovery Act Project Performance through March 2010:
Argonne National Laboratory (IL):
Project number: 1. CH-ANLE-0040.NEW.R1.1;
Project description: D&D: Building 310;
Cost target: Positive;
Schedule target: [Empty];
Performance measures[A]: Performance measure with no planned work;
Performance measure with no planned work; Performance measure with no
planned work.
Project number: 2. CH-ANLE-0040.NEW.R1.2;
Project description: D&D: Building 330;
Cost target: Positive;
Schedule target: [Empty];
Performance measures[A]: Positive; Performance measure with no planned
work; Performance measure with no planned work.
Project number: 3. CH-ANLE-0040.NEW.R1.3;
Project description: D&D: Alpha-Gamma Hot Cell Facility;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: Negative.
Project number: 4. CH-ANLE-0040.NEW.R1.4;
Project description: TRU waste processing;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: Positive; Positive; Positive; Performance
measure with no planned work.
Brookhaven National Laboratory (NY):
Project number: 5. BRNL-0040.R1;
Project description: D&D: Brookhaven Graphite Research Reactor;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: Positive; Performance measure with no planned
work; Performance measure with no planned work; Performance measure
with no planned work.
Project number: 6. BRNL-0041.R1;
Project description: D&D: High Flux Beam Reactor;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: Positive; Positive; Positive; Performance
measure with no planned work.
Project number: 7. BRNL-0041.NEW.R1;
Project description: D&D: High Flux Beam Reactor;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: Positive; Positive; Positive.
Energy Technology Engineering Center (CA):
Project number: 8. CBC-ETEC-0040.R1.1;
Project description: D&D: EPA radiological characterization;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: [Empty].
Project number: 9. CBC-ETEC-0040.R1.2;
Project description: Soil and groundwater cleanup;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: Performance measure with no planned work.
Hanford Site: Office of River Protection (WA):
Project number: 10. ORP-0014.R1.1;
Project description: Tank waste support: Tank farm infrastructure
upgrades;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: Positive; Positive; Positive; Positive;
Positive; Positive.
Project number: 11. ORP-0014.R1.2;
Project description: Tank waste support: Other infrastructure upgrades;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: Performance measure with no planned work.
Project number: 12. ORP-0014.R1.3;
Project description: Tank waste support: Facility upgrades;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: Positive; Positive; Positive; Positive;
Positive; Positive; Positive.
Project number: 13. ORP-0014.R1.4;
Project description: Tank waste support: Waste feed infrastructure
upgrades;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: Positive; Performance measure with no planned
work.
Project number: 14. ORP-0014.R1.5;
Project description: Tank waste support: SY transfer line upgrade;
Cost target: Negative;
Schedule target: Negative;
Performance measures[A]: [Empty].
Hanford Site: Richland Operations Office (WA):
Project number: 15. RL-0011.R1;
Project description: D&D: Plutonium Finishing Plant;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: Positive; Negative.
Project number: 16. RL-0013C.R1.1;
Project description: Solid waste disposal: Mixed low-level waste
treatment;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: Positive; Positive.
Project number: 17. RL-0013C.R1.2;
Project description: TRU waste processing;
Cost target: Positive;
Schedule target: Negative;
Performance measures[A]: Positive; Positive; Positive.
Project number: 18. RL-0030.R1;
Project description: Soil and groundwater cleanup: Treatment and
monitoring;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: Positive; Positive.
Project number: 19. RL-0040.R1.1;
Project description: D&D: U Plant/other;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: Positive; Positive; Negative; Negative;
Performance measure with no planned work; Performance measure with no
planned work.
Project number: 20. RL-0040.R1.2;
Project description: D&D: Outer Zone;
Cost target: Positive;
Schedule target: Negative;
Performance measures[A]: Positive; Positive; Positive; Positive;
Positive; Positive; Negative; Performance measure with no planned work;
Project number: 21. RL-0041.R1.1;
Project description: D&D: 100 K Area;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: Positive; Negative; Negative; Negative.
Project number: 22. RL-0041.R1.2;
Project description: D&D: Disposal facility expansion;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: Positive.
Project number: 23. RL-0041.R1.3;
Project description: D&D: Remedial action/footprint reduction;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: Negative; Negative; Performance measure with
no planned work.
Project number: 24. RL-0041.R2;
Project description: D&D: 618-10 burial grounds;
Cost target: Negative;
Schedule target: Positive;
Performance measures[A]: Performance measure with no planned work.
Idaho National Laboratory (ID):
Project number: 25. ID-0013.R1;
Project description: TRU waste processing;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: Positive; Positive; Positive.
Project number: 26. ID-0013.NEW.R1;
Project description: TRU waste processing;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: Positive.
Project number: 27. ID-0030B.R1.1;
Project description: Soil and groundwater cleanup: Buried waste;
Cost target: Positive;
Schedule target: Negative;
Performance measures[A]: [Empty].
Project number: 28. ID-0030B.R1.2;
Project description: Soil and groundwater cleanup: In-situ grouting;
Cost target: Positive;
Schedule target: Negative;
Performance measures[A]: [Empty].
Project number: 29. ID-0030B.R1.3;
Project description: Soil and groundwater cleanup: Operations;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: Positive.
Project number: 30. ID-0040B.R1.1;
Project description: D&D: 39 facilities;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: Positive; Positive; Positive; Positive.
Project number: 31. ID-0040B.R1.2;
Project description: D&D: 29 facilities;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: Positive; Positive; Positive; Positive.
Project number: 32. ID-0040B.NEW.R1.3;
Project description: D&D: Nuclear Energy facilities;
Cost target: Negative;
Schedule target: Negative;
Performance measures[A]: Positive; Positive; Positive; Performance
measure with no planned work.
Los Alamos National Laboratory (NM):
Project number: 33. VL-LANL-0030.R1.1;
Project description: Soil and groundwater cleanup: Material Disposal
Area B;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: Performance measure with no planned work;
Performance measure with no planned work; Performance measure with no
planned work.
Project number: 34. VL-LANL-0030.R1.2;
Project description: Soil and groundwater cleanup: Groundwater wells;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: Positive.
Project number: 35. VL-LANL-0040-D.R1;
Project description: D&D: Defense-related facilities;
Cost target: Negative;
Schedule target: Positive;
Performance measures[A]: Positive; Positive; Positive.
Project number: 36. VL-LANL-0040-N.R1;
Project description: D&D: Nondefense-related facilities;
Cost target: Positive;
Schedule target: Negative;
Performance measures[A]: Positive; Positive; Performance measure with
no planned work.
Moab UMTRA Site (UT):
Project number: 37. CBC-MOAB-0031.R1;
Project description: Soil and groundwater cleanup: Mill tailings;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: Positive; Positive.
Mound Site (OH):
Project number: 38. OH-MB-0031.NEW.R1;
Project description: Soil and groundwater cleanup: Operable Unit 1;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: Positive; Performance measure with no planned
work.
Nevada Test Site (NV):
Project number: 39. VL-NV-0030.R1;
Project description: Soil and groundwater cleanup;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: Positive; Negative; Performance measure with
no planned work; Performance measure with no planned work; Performance
measure with no planned work.
Oak Ridge Reservation (TN):
Project number: 40. OR-0013B.R1.1;
Project description: TRU waste processing;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: Positive; Positive; Positive; Negative.
Project number: 41. OR-0040.R1;
Project description: D&D: East Tennessee Technology Park;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: [Empty].
Project number: 42. OR-0041.R1.1;
Project description: D&D: Y-12 facility;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: Positive; Performance measure with no planned
work; Performance measure with no planned work.
Project number: 43. OR-0041.R1.2;
Project description: D&D: Y-12 remediation preparation;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: Positive; Positive; Performance measure with
no planned work; Performance measure with no planned work.
Project number: 44. OR-0041.R1.3;
Project description: D&D: Disposal facility expansion;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: [Empty].
Project number: 45. OR-0041.NEW.R1.1;
Project description: D&D: Y-12 excess material;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: Positive; Negative; Negative; Performance
measure with no planned work.
Project number: 46. OR-0041.NEW.R1.2;
Project description: D&D: Y-12 biology complex;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: Negative; Performance measure with no planned
work; Performance measure with no planned work; Performance measure
with no planned work.
Project number: 47. OR-0041.NEW.R1.3;
Project description: D&D: Y-12 9206 filter house;
Cost target: Negative;
Schedule target: Positive;
Performance measures[A]: Positive; Positive.
Project number: 48. OR-0042.R1.1;
Project description: D&D: Defense legacy material removal;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: [Empty].
Project number: 49. OR-0042.R1.2;
Project description: D&D: Defense facility demolition;
Cost target: Negative;
Schedule target: Positive;
Performance measures[A]: Positive; Negative; Negative.
Project number: 50. OR-0042.R1.3;
Project description: D&D: Defense remedial actions;
Cost target: Negative;
Schedule target: Positive;
Performance measures[A]: Negative; Performance measure with no planned
work; Performance measure with no planned work; Performance measure
with no planned work; Performance measure with no planned work;
Performance measure with no planned work.
Project number: 51. OR-0042.NEW.R2.1;
Project description: D&D: Nondefense legacy material removal;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: [Empty].
Project number: 52. OR-0042.NEW.R2.2;
Project description: D&D: 2000 complex;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: Positive; Negative; Performance measure with
no planned work; Performance measure with no planned work.
Project number: 53. OR-0042.NEW.R2.3;
Project description: D&D: Misc. facility demolition;
Cost target: Negative;
Schedule target: Positive;
Performance measures[A]: [Empty].
Paducah Site (KY):
Project number: 54. PA-0040.R1.1;
Project description: D&D: C-410;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: Performance measure with no planned work;
Performance measure with no planned work; Performance measure with no
planned work; Performance measure with no planned work.
Project number: 55. PA-0040.R1.2;
Project description: D&D: C-340;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: Performance measure with no planned work;
Performance measure with no planned work; Performance measure with no
planned work; Performance measure with no planned work; Performance
measure with no planned work.
Project number: 56. PA-0040.R1.3;
Project description: D&D: C-746-A;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: Performance measure with no planned work;
Performance measure with no planned work; Performance measure with no
planned work; Performance measure with no planned work.
Portsmouth Site (OH):
Project number: 57. PO-0013.R1;
Project description: Solid waste disposal: UMC disposition;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: Positive.
Project number: 58. PO-0040.R1.1;
Project description: D&D: X-701B plume remediation;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: Positive; Performance measure with no planned
work.
Project number: 59. PO-0040.R1.2;
Project description: D&D: X-533;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: Positive; Performance measure with no planned
work.
Project number: 60. PO-0040.R1.3;
Project description: D&D: X-633;
Cost target: Negative;
Schedule target: Positive;
Performance measures[A]: Positive; Performance measure with no planned
work; Performance measure with no planned work; Performance measure
with no planned work.
Project number: 61. PO-0040.R1.4;
Project description: D&D: X-760;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: Positive; Performance measure with no planned
work; Performance measure with no planned work.
Savannah River Site (SC):
Project number: 62. SR-0011C.R1.1;
Project description: TRU waste processing: Canyon complex support;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: [Empty].
Project number: 63. SR-0013.R1.1;
Project description: Solid waste disposal;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: Positive; Positive; Negative; Negative;
Negative; Performance measure with no planned work.
Project number: 64. SR-0013.R1.2;
Project description: TRU waste processing;
Cost target: Negative;
Schedule target: Negative;
Performance measures[A]: Positive; Positive; Positive; Positive.
Project number: 65. SR-0014C.R1.1;
Project description: Tank waste support: Waste systems
recapitalization;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: [Empty].
Project number: 66. SR-0014C.R1.PEN;
Project description: Tank waste support: Contractor pension payment;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: [Empty].
Project number: 67. SR-0030.R1.1;
Project description: D&D: P and R Area completion;
Cost target: Negative;
Schedule target: Negative;
Performance measures[A]: [Empty].
Project number: 68. SR-0030.R1.2;
Project description: D&D: P reactor;
Cost target: Positive;
Schedule target: Negative;
Performance measures[A]: Performance measure with no planned work;
Performance measure with no planned work; Performance measure with no
planned work; Performance measure with no planned work; Performance
measure with no planned work.
Project number: 69. SR-0030.R1.3;
Project description: D&D: P ash basin;
Cost target: Negative;
Schedule target: Negative;
Performance measures[A]: [Empty].
Project number: 70. SR-0030.R1.4;
Project description: D&D: R reactor;
Cost target: Positive;
Schedule target: Negative;
Performance measures[A]: Positive; Performance measure with no planned
work; Performance measure with no planned work; Performance measure
with no planned work; Performance measure with no planned work.
Project number: 71. SR-0030.R1.5;
Project description: D&D: R ash basin;
Cost target: Negative;
Schedule target: Positive;
Performance measures[A]: [Empty].
Project number: 72. SR-0030.R2.1;
Project description: D&D: M and D Area completion;
Cost target: Negative;
Schedule target: Positive;
Performance measures[A]: Performance measure with no planned work.
Project number: 73. SR-0030.R3.1;
Project description: D&D: Sitewide completion;
Cost target: Negative;
Schedule target: Negative;
Performance measures[A]: Positive; Positive; Positive; Positive;
Positive; Performance measure with no planned work; Performance
measure with no planned work; Performance measure with no planned
work; Performance measure with no planned work.
Project number: 74. SR-0030.R3.2;
Project description: D&D: Test reactor decommissioning;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: Performance measure with no planned work;
Performance measure with no planned work; Performance measure with no
planned work.
Project number: 75. SR-0040.R1.1;
Project description: D&D: Surveillance and maintenance;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: [Empty].
Separations Process Research Unit (NY):
Project number: 76. VL-SPRU-0040.R1.1;
Project description: D&D: Building G2 and H2;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: Positive; Performance measure with no planned
work; Performance measure with no planned work.
Project number: 77. VL-SPRU-0040.R1.2;
Project description: D&D: Contaminated soil removal, North Field;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: Positive; Performance measure with no planned
work.
SLAC National Accelerator Laboratory (CA):
Project number: 78. CBC-SLAC-0030.R1;
Project description: Soil and groundwater cleanup;
Cost target: Negative;
Schedule target: Negative;
Performance measures[A]: [Empty].
Waste Isolation Pilot Plant (NM):
Project number: 79. CB-0080.R1;
Project description: Operate waste disposal facility;
Cost target: Positive;
Schedule target: Negative;
Performance measures[A]: [Empty].
Project number: 80. CB-0081.R1;
Project description: Waste characterization;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: Positive; Negative.
Project number: 81. CB-0090.R1;
Project description: TRU waste processing;
Cost target: Positive;
Schedule target: Positive;
Performance measures[A]: Positive; Performance measure with no planned
work; Performance measure with no planned work.
West Valley Demonstration Project (NY):
Project number: 82. OH-WV-0013.R1;
Project description: TRU waste processing;
Cost target: Negative;
Schedule target: Negative;
Performance measures[A]: Positive.
Project number: 83. OH-WV-0040.R1.1;
Project description: D&D: Main plant;
Cost target: Positive;
Schedule target: Negative;
Performance measures[A]: Performance measure with no planned work;
Performance measure with no planned work; Performance measure with no
planned work.
Project number: 84. OH-WV-0040.R1.2;
Project description: D&D: Other facilities;
Cost target: Negative;
Schedule target: Negative;
Performance measures[A]: Performance measure with no planned work;
Performance measure with no planned work; Performance measure with no
planned work; Performance measure with no planned work.
Source: GAO analysis of DOE data.
Notes:
Positive cost performance means that the value of work performed is
greater than what the work actually cost to accomplish. For example,
if the earned value of work completed by a contractor is $5 million,
and the work actually cost $5 million or less to complete, then cost
performance is considered positive. Schedule performance is also
measured in dollars, but in this case, positive performance means that
the value of the work completed in a given period is greater than what
had been planned. For example, if the contractor is given 1 month to
complete $5 million of work and completes that earned value of work by
that deadline or earlier, then schedule performance is considered
positive. DOE considers cost and schedule targets to be positive until
they drop below 90 percent of the target. That is, work could come
slightly under expectations--but not less than 90 percent of the
target--and still be considered positive.
Negative cost performance means that the value of work performed is
less than what the work actually cost to accomplish. For example, if
the earned value of work completed by a contractor is $5 million, but
the work actually cost $6.7 million, cost performance would be
considered negative. Schedule performance is also measured in dollars,
but in this case, negative performance means that the value of the
work completed in a given period is less than what had been planned.
For example, if the contractor is given 1 month to complete $10
million of work but completes only $5 million in earned value of work
by that deadline, then schedule performance is considered negative.
Performance measures are currently in place for the associated
projects, but the planned work associated with these measures has not
yet begun. As a result, these measures do not yet provide a meaningful
way to monitor progress made on the projects. DOE considers
performance targets to be positive until they drop below 90 percent of
the target. That is, work could come slightly under expectations--but
not less than 90 percent of the target--and still be considered
positive.
[A] Number of performance measures per project.
[End of table]
[End of section]
Appendix V: Comments from the Department of Energy:
Department of Energy:
Washington, DC 20585:
July 16, 2010:
Mr. Gene Aloise, Director:
Natural Resources and Environment:
U.S. Government Accountability Office:
Washington, DC 20548:
Dear Mr. Aloise:
Thank you for your effort in reviewing and reporting on Recovery Act
work by the Department of Energy's (DOE) Office of Environmental
Management (EM) and the opportunity to review your draft report:
Recovery Act, Most DOE Cleanup Projects Appear to be Meeting Cost and
Schedule Targets, but Assessing Impact of Spending Remains a Challenge
(GAO 10-784). DOE appreciates the opportunity to provide feedback on
the statements, conclusions, and recommendations in the report.
DOE responses to the report recommendations and divergent statements
are summarized below:
Project Management - DOE concurs with GAO recommendations regarding
evaluating the effectiveness of additional project management and
oversight steps adopted for Recovery Act projects and determining if
these steps would be effective for the EM Base Program funded under
annual appropriations. EM has already evaluated and taken several
steps to more broadly implement Recovery Act initiatives beginning as
early as June 2009. These include increased review and engagement by
management; and restructuring the EM portfolio of programs, projects
and activities into more appropriate and manageable sizes. Other steps
are still being developed and evaluated. As Recovery Act work
continues, more data will be available upon which to base quantitative
analysis of Recovery Act practices.
Jobs Creation ” EM agrees with GAO's recommendation to ensure
methodology for calculating job creation is clear and will articulate
this to the public. EM communicates three figures when presenting the
number of workers impacted with Recovery Act funding. These three are
prime contractor full time equivalents (FTEs), prime contractor and
subcontractor FTEs, and total headcount.
Both prime contractor and subcontractor FTEs are calculated strictly
in accordance with Office of Management and Budget guidance, and
therefore there is no ambiguity in the methodologies employed between
prime and subcontractor FTE data. Changes to Federal Acquisition
Regulation (FAR) clause 52.204-11 will result in both prime and
subcontractor jobs being reported in FederalReporting.gov, thus
negating GAO's concern on the matter.
It is also important to note that a number of EM Recovery Act workers
may not be employed full-time nor for the full duration of the EM
Recovery Act program. Headcount is the method employed by EM to
account for these workers. Headcount is the cumulative number of
workers, full-time, part-time, and temporary workers that benefited
from Recovery Act with direct labor charges to Recovery Act funds.
EM's collection and reporting of this figure augments and facilitates
transparency and accountability of Recovery Act job creation.
Footprint Reduction ” DOE agrees with GAO's recommendation to have in
place clear, quantifiable and consistent measures for footprint
reduction, which, as a brand new measure, has taken some time to fully
define. Footprint reduction is a measure intended to objectively track
incremental progress (number of square miles cleaned up) toward
completing DOE's large site remediation effort that will not be
totally finished for many years. Footprint reduction has now been
defined, communicated with all the sites, and is being reported to
show progress on a regular basis.
Successful site cleanup, area closure, and footprint reduction as a
result of soil and groundwater remediation and facility
decontamination and decommissioning meets DOE's long term goals by
maximizing the reduction of environmental, safety, and health risks.
EM measures its success in reducing these risks by tracking
quantifiable outputs of its cleanup process. Among others, these
include installing groundwater wells for remediation systems,
decontaminating, decommissioning, and demolishing contaminated
facilities, disposing of contaminated debris piles, and remediating
soil units.
Life-Cycle Cost - EM agrees with the GAO's recommendation and will
continue to use the DOE and OMB guidance to calculate cost savings and
to develop and portray life-cycle cost estimates. EM develops life-
cycle cost, scope, and schedule estimates for projects in accordance
with DOE Order 413.3A. The Order specifies that cost estimates include
escalation and therefore are in current year dollars. Current
(escalated) dollars are used in DOE's budget requests and within
reports provided to Congress and our stakeholders. Therefore in order
to remain consistent with our Orders and our entire budget reporting,
any cost savings or reductions to our life-cycle cost estimates that
are achieved because of Recovery Act Funding are also reported in
current dollars.
Spending Versus Spend Plans - The initial project spend plans for the
EM Recovery Act were developed prior to contracts being finalized.
After pricing and technical proposals were negotiated and approved
between the Department of Energy and the Prime Contractors affiliated
with each of the EM sites, Recovery Act projects baselines were
adjusted to reflect the approved contracts. The current project spend
plans reflect an overall "spend rate" of approximately $200M per
month, which the program is achieving. EM's internal goal established
at the beginning of the Recovery Act was to have a majority of
Recovery Act funds spent by the end of Fiscal Year 2011. With the
exceptions of 9 projects, due to scope changes, EM is on-track to
spend over 95 percent of project funds per the original goal.
Performance Measures - DOE has concern over the method GAO appears to
be using to determine project cost and schedule status. It appears
that GAO is classifying performance as negative unless measure actual
are "exactly" equal to or greater than the planned target. This is
inconsistent with DOE and consensus project management best practices.
Project Metrics ” DOE has concerns with GAO statements such as
"inconsistencies exist between some projects' cost and schedule
performance and progress shown by other performance measures..." and
"...we found that the results as assessed by performance measures were
sometimes inconsistent with the results shown by earned value data..."
DOE uses Earned Value Measurement Systems (EVMS) and performance
metrics as important components of a tool kit which includes numerous
performance indicators (milestones, project risk status, use of
management reserve and contingency, etc.) in assessing project health
and performance. Project performance information provides different,
but complementary insight into essential aspects of overall project
performance. EM project managers and senior program managers take in
all available information to arrive at a complete picture of project
health.
DOE's review has identified several statements and text corrections
that should be addressed prior to release of the GAO report.
Attachment 1 provides DOE's detailed response to GAO's recommendations
and statements, and Attachment 2 provides a summary of DOE review
comments discovered in the draft reports.
EM remains committed to the objectives of the Recovery Act program ”
to create jobs and accelerate cleanup of legacy waste sites from the
nuclear weapons production program.
If you have any further questions, please contact Cynthia Anderson,
Director, EM Recovery Act Program, at 202-586-2083.
Sincerely,
Signed by:
Ines R. Triay:
Assistant Secretary for Environmental Management:
Attachments:
[End of letter]
Attachment 1:
Department of Energy:
Comments on the Draft Government Accountability Office (GAO) Report
GA0-10-784:
DOE Responses to GA0-10-784 Recommendations for Executive Action:
GAO Recommendation 1: Determine whether additional project management
and oversight steps adopted for the Recovery Ad projects, such as more
frequent reporting, have proven beneficial and whether these steps
would be effective and appropriate for DOE's cleanup projects funded
under annual appropriations.
DOE Response 1: The Office of Environmental Management (EM)
fundamentally agrees with the recommended action. The increased review
and engagement by EM senior management for Recovery Act work provided
an opportunity for early qualitative evaluation of the success of
Recovery Act initiatives, and EM has already taken several steps to
more broadly implement Recovery Act initiatives beginning as early as
June 2009. As Recovery Act work continues, more data will be available
upon which to base quantitative analysis of Recovery Act practices.
The budget and management structure of the EM portfolio of programs,
projects, and activities (PPA) is fundamental to the management and
oversight of the EM mission work. The EM Recovery Act Program,
Portfolio Management Framework (July 10, 2009), was developed to
provide a structure to enable greater review, oversight, and control
of Recovery Act projects. While this Framework was still draft, EM
signaled the intent to utilize this Framework for the entire EM
portfolio (also referred to as the Base program) via the distribution
of a memo from Dr. Ines Triay, dated June 5, 2009. Additional memos
and guidance to the field from Dr. Triay and senior managers in June
2009, November 2009, and April 2010 have continued the evolution of
the EM portfolio toward a clear definition of capital projects and
operations activities, and a decomposition of large projects into more
appropriate and manageable sizes.
The evolution of the EM portfolio described above is being
complemented by a reworking of the reporting and review mechanisms.
Quarterly Project Reviews (QPRs) were the standard for review of the
EM projects. The Recovery Act began with monthly project reviews which
provided for more direct and immediate EM oversight and corrective
action. Monthly reviews which included the Base program capital
projects which utilized back-to-back reporting, Recovery Act and Base
program, began in March 2010. In May 2010 these reviews advanced to a
combined Recovery Act/Base program monthly review. Efforts continue to
refine the data analysis and formatting to provide for a full monthly
review of the entire EM portfolio, including capital projects and
operations activities for both, Recovery Act and Base program, to
begin in October 2010.
The tighter control of funds for Recovery Act work was necessitated by
the nature of the Recovery Act funding and additional Office of
Management and Budget restrictions. The new EM management portfolio of
projects and operations activities inherently will provide more
discreet funding control because of the smaller size of individual
budget elements. Whether the controls for release of spending
authority to the field used for Recovery Act will provide additional
benefit to the Base program is still under evaluation.
Additional Federal oversight staff, particularly in the form of
Recovery Act Site Representatives (RASRs) physically located at the
largest Recovery Act sites, has been a very successful practice for
the Recovery Act. The RASR role in the monthly evaluation and review
process, as well as providing immediate feedback on site challenges
and opportunities, has allowed EM senior management to shorten the
analysis and decision cycle on field issues, thus being more
responsive. The EM Office of Program and Site Support has similar
oversight staff assigned to liaison with field locations for the Base
program, but these staff are located in EM headquarters and thus do
not have the same direct access and oversight as the RASRs for the
Recovery Act work. An opportunity is being evaluated to merge these
oversight efforts to capture the best features of both.
Finally, EM notes that the GAO report and recommendation only mentions
a few of the management and oversight steps which EM has employed
under Recovery Act. EM has developed Lessons Learned guidance which
has been issued to the field sites. EM has developed a path forward
and template which has been issued to the sites to capture Lessons
Learned on Recovery Act Projects. EM is also in the process of
developing Lessons Learned guidance which will first be implemented on
Recovery Act Projects and then evaluated and modified if necessary,
for use within the Base Program. Lessons learned on the Recovery Act
Program initiation and contract management are also being captured for
incorporation where applicable into the EM Base program and other DOE
programs as deemed applicable. Lessons learned will be tracked in a
searchable and reportable database that has been used and been proven
to be an effective tool in tracking lessons learned for health and
safety issues. EM has conducted two lessons learned information
exchanges, in November 2009 and April 2010, to further advance the
knowledge exchange.
EM views the Recovery Act Program as a rare opportunity to accelerate
completion of EM work, to reduce risk and reduce the footprint of EM,
but also as an incubator for focused and responsive management and
oversight practices. EM has already put some lessons from the Recovery
Act in place for the Base program, and, as the Recovery Act work
continues to completion, EM is fully committed to making full use of
the future lessons.
GAO Recommendation 2: When reporting the impact of Recovery Act
funding on job creation, clearly indicate the methodology used to
calculate each of the figures reported: prime contractor FTEs,
subcontractor and prime contractor FTEs combined, or head count.
DOE Response 2: EM agrees with the recommendation to ensure the
methodology for calculating job creation is clear. EM communicates
three figures when presenting the number of workers impacted with
Recovery Act funding. These three include prime contractor full time
equivalents (FTEs), prime contractor and subcontractor FTEs, and
headcount.
Prime contractor FTEs are reported into FederalReporting.gov on a
quarterly basis and are calculated in accordance with the Office of
Management and Budget (OMB) M-10-08, "Updated Guidance on the American
Recovery and Reinvestment Act ” Data Quality, Non-Reporting
Recipients, and Reporting of Job Estimates," issued December 18, 2009.
Basically, this calculation takes into account the total number of
hours worked that are funded by the Recovery Act divided by the number
of hours in a full-time schedule.
Subcontractor FTEs are calculated in accordance with the same OMB
guidance and are reported together with prime contractor FTEs by EM in
newsletters, new flashes, press releases, monthly reviews, and public
presentations to stakeholders. To date, subcontractor FTEs have not
been required to be reported into FederalReporting.gov and as noted in
the GAO report account for as much as 50% of EM Recovery Act total job
creation. However, subcontractor FTE figures will begin being reported
in the third quarter 2010 in accordance with recent changes to the FAR
clause 52.204-11 to implement section 1512 reporting requirements of
the Recovery Act.
The intent of EM's initiative to collect and report both prime and
subcontractor FTEs has always been to reflect a more accurate figure
for the total number of FTEs saved or created under EM Recovery Act
funds. This represents a more credible total number of EM Recovery Act
full-time jobs.
In regards to the EM headcount figure, a significant number of EM
Recovery Act workers will work on projects or subprojects that will
not last the entire duration of the EM Recovery Act program. However,
these workers's have benefited from EM Recovery Act funding. Therefore
a headcount figure of number of the workers, full-time, part-time and
temporary workers compensated with Recovery Act funding has been
collected and reported by EM communication venues noted above. The
methodology EM utilizes to determine headcount is a cumulative number
of workers who have benefited from Recovery Act funds.
The change to the FAR clause will result in both prime and
subcontractor (combined) jobs being reported in FederalReporting.gov
thus negating GAO's concern on the matter. As for the EM headcount,
collection and reporting of this figure continues to facilitate
transparency and accountability of EM Recovery Act funded impact on
job creation.
To more clearly articulate the methodologies for calculating EM job
creation, the EM guidance for calculating jobs has been posted on the
EM Recovery Act website. In addition, a one-page explanation sheet
will be included whenever job numbers are presented to stakeholders
and/or the public.
GAO Recommendation 3: Develop clear, quantifiable, and consistent
measures for determining the impact of Recovery Act funding on
environmental risk. As part of this effort, clearly define what the
DOE footprint consists of determine how changes to the footprint will
be measured, and ensure that all DOE sites report changes to their
footprint in a consistent and comparable manner.
DOE Response 3: Prior to initiation of any Recovery Act field
activities, EM required all sites to develop a project-specific risk
register for each project. Identification and quantification of risks
were developed consistent with applicable DOE risk management guides
and with guidance provided by both OMB and the office of the DOE Chief
Financial Officer (CFO). This guidance required that all projects
receiving Recovery Act funding to identify risks for each of the
following category and/or sub-categories:
Category: People;
Sub-Category: Human capital;
Sub-Category: Organizational structure.
Category: Processes;
Sub-Category: Procedures;
Sub-Category: Funds control;
Sub-Category: Reporting.
Category: Governance;
Sub-Category: Project structure;
Sub-Category: Administration and management;
Sub-Category: Monitoring;
Sub-Category: Special concerns;
Sub-Category: Performance metrics.
Category: Technology;
Sub-Category: Systems.
Category: Project Specific;
Sub-Category: Regulatory;
Sub-Category: Conflict of interest;
Sub-Category: Safety & health;
Sub-Category: Other special concerns.
[End of table]
EM also implemented a system to store/sort all project related risks
from all sites in a headquarters controlled risk repository. As a
follow-up to the original site-provided risk registers, EM also
initiated a detailed review and update at each site during late June
and through the month of July 2010. During this review, sites had the
opportunity to update previously reported risks and the inclusion of
new risks from recently added projects. Each site received training
and software licenses to allow input to be provided to the repository
directly by the site for those projects located at the specific site.
This repository provides EM Headquarters the ability to review the
disposition of risks by site; types of risks; and potential
magnitude/impact of risks by site or category of risks, including
appropriate mitigation strategies. EM uses this ongoing valuation of
risks to monitor the use of project-specific management reserve and
DOE contingency.
Following completion of the July site training and update, EM will
post the top-25 risks on the portal.
EM agrees with this GAO recommendation and has implemented a system
that clearly defines EM's cleanup mission/scope through a number of
processes, including agreements with regulatory agencies. This scope
is defined through EM's life-cycle performance metrics (Base scope
plus ARRA scope), which quantify the measurable and necessary steps in
the cleanup process and have been in place for nearly 15 years. These
performance measures are focused on outputs. The specific outputs
chosen are directly tied to cleanup of the site, which results in
environmental risk reduction. Therefore, as we measure achievement of
cleanup steps, we are thereby measuring progress toward cleanup and
reducing overall environmental risks.
Historically, EM has tracked area closures in terms of the number of
geographic sites completed. EM's responsibility has included 107
geographic sites, and through 2010 has closed 89 of these sites. Since
EM's ARRA work scope is largely centered on the largest sites, the
Hanford and Savannah River Sites, where the cleanup mission will not
be completed for many years, EM adopted a footprint reduction tracking
system in order to measure incremental progress in completing these
large sites.
EM has established footprint reduction as a High Priority Performance
Goal (HPPG) for the department to demonstrate progress. Specifically,
EM has committed to a 40% footprint reduction in the square mileage
under EM control by September 30, 2011 (i.e., reducing footprint from
900 square miles to 540 square miles). Performance against the HPPG is
reported to OMB and is updated on a quarterly basis. Specific measures
tracked by EM for the performance of this goal includes number of
soils units remediated and debris piles removed, and number of
industrial/radioactive facilities decontaminated and decommissioned.
OMB will make the HPPG performance available through its release of
Performance.gov by the fall of 2010.
Footprint reduction is a high-level benefit to the nation and the
respective communities. Achieving EM footprint reduction as a result
of soil and groundwater remediation and facility decontamination and
decommissioning maximizes the reduction of environmental, safety, and
health risks in a safe, secure, compliant, and cost-effective manner.
Removal of contamination also reduces monitoring and maintenance life-
cycle costs and liabilities.
GAO Recommendation 4: Ensure that savings estimates over the life of
the cleanup projects are calculated according to OMB and DOE guidance,
so that those estimates accurately represent potential savings and
reflect cost adjusted for both inflation and the time value of money.
DOE Response 4:
EM agrees with the GAO's life-cycle cost calculation recommendation
and will continue to utilize the Department's and OMB's guidance to
calculate cost savings, and develop and portray life-cycle cost
estimates where applicable.
EM develops the life-cycle cost, scope and schedule required to
complete specific cleanup projects captured in a Project Baseline
Summary (PBS) in accordance with DOE Order 413.3A, Program and Project
Management for the Acquisition of Capital Assets. The Order and
supporting Guides specify that project cost estimates include
escalation and, therefore, are in current year dollars. These cost
estimates are utilized to portray the life-cycle cost associated with
the cleanup of the Cold War legacy.
EM recognizes the importance of taking into account the time value of
money when comparing specific projects or activities. EM will continue
to use OMB Circular A-94, Guidelines and Discount Rates for Benefit-
Cost Analysis of Federal Programs, when conducting alternative
analysis to determine the cost/benefit and return on investment
associated with project activities. In fact, EM utilized this
methodology to determine candidates for receipt of ARRA funding.
In addition, EM will continue to portray its life-cycle cost based on
the life-cycle cost estimates developed in accordance with DOE Order
413.3A. EM reports its life cycle cost in current (escalated) dollars
in its annual Congressional Budget Request and other congressionally
mandated reports to Congress such as the January 2009 Status of
Environmental Management Initiatives to Accelerate the Reduction of
Environmental Risks and Challenges Posed by the Legacy of the Cold War
and the June 2010 updated appendices to this report which included a
listing of life-cycle cost by Site and PBS.
To be consistent with the life-cycle cost projections Congress and our
stakeholders are seeing in our budget requests and Congressional
Reports, any reduction in the life cycle cost is also reported in
current dollars. Our life cycle cost reported in the June 2010 update
to Status of Environmental Management Initiatives to Accelerate the
Reduction of Environmental Risks and Challenges Posed by the Legacy of
the Cold War factored in the $4B in cost savings attributed to the
acceleration of cleanup work as a result of ARRA funding.
In addition to the $4B in life-cycle cost savings, EM has also
estimated cost avoidances of more than $3 billion that have resulted
from the receipt of Recovery Act funding. These cost avoidances should
also be accounted for in the final report. For example ARRA funding at
Idaho, Oak Ridge, Savannah River Site, and Hanford has enabled these
transuranic waste generator sites to accelerate shipments to the Waste
Isolation Pilot Plant (WIPP) by many years, avoiding a schedule
extension and continued operating costs. The reduced operating time
resulting in an estimated cost avoidance of $2.5 billion at WIPP,
compared to what the cost would have been had ARRA funding not been
received.
GAO Statements:
DOE Response to GAO 2012 Spending Statements - The initial EM Recovery
Act spend plans were developed prior to contract definitization. As
project price and technical proposals were negotiated and approved, EM
re-baselined spending plans. As project price and technical proposals
were negotiated and approved, EM revised these spending plans. The
current plans reflect an overall "burn rate" of approximately $200M
per month, which the program is achieving. With the following
exceptions (due to scope changes), EM expects Recovery Act projects
will be complete (and funds expended) by the end of FY 2011.
* INL D&D of EBR II (June 2012);
* Title X Uranium/Thorium Reimbursements (April 2013);
* OR Y-12 D&D (December 2011);
* ORNL Defense D&D (December 2011);
* ORNL Non-Defense D&D (Defense 2011);
* OR Uranium Enrichment Facility D&D (December 2011);
* SRS Solid Waste and Accelerated TRU Disposition (December 2012);
* SRS P and R Area Completions (September 2012);
* EPA's Radioactive Site Characterization of Area IV of the Santa
Susana Field Lab (December 2011).
Fluctuations in the total amount of allotted funds that are obligated
arc due to downward adjustments to make obligation authority available
for OMB re-apportionment. These re-apportionments primarily occur
within site allocations to realign funding between projects when cost
efficiencies are realized or scope additions/deletions are required.
The de-obligation process must he followed before reapportionment
action can be approved at OMB. When all de-obligation and re-
obligation actions are completed, there will be a net effect of zero
to EM's allocation of $6 billion.
DOE Response to GAO Project Metrics Statements ” DOE has concerns with
GAO statements such as "...inconsistencies exist between some
projects' cost and schedule performance and progress shown by other
performance measures..." (bottom of pg 12) and "...we found that the
results as assessed by performance measures were sometimes
inconsistent with the results shown by earned value data..." (top of
pg 19) Project performance information, including such data elements
as EVMS, performance metrics, milestones, project risk status, use of
management reserve and contingency, etc., each provide different, but
complementary, insight into different aspects of overall project
performance. EM project managers and senior program managers take in
all available information to arrive at a complete picture of project
health, before rendering an assessment. Performance measures were
selected to provide visibility into a distinct but important aspect of
the project, in some cases, a relatively minor percentage of the
project cost value; Earned Value (EV), on the other hand, typically
encompasses the entire scope basis. While the last sentence in the
paragraph on page 19 is the most important and reflects a more
accurate response, the term "inconsistencies" is still inappropriate
and should be replaced with "differences in indicators".
At the bottom of page 16, the GAO report states that as of March of
2010, "DOE reported that across the complex, progress on five of seven
selected performance measures was meeting or exceeding targets..." DOE
believes strongly this should read "five out of six" performance
measures are meeting or exceeding their targets. As previously
explained to GAO, "Demolition debris and soil permanently disposed"
was specifically not established as a performance measure, but rather
as a measurable unit useful in planning and estimating, as well as in
conveying overall progress against cleanup (e.g., when rolled up to
the site or complex-wide level). Using waste minimization best
practices and avoiding generation and disposal of wastes is in the
best interest of the government and overall project performance is
actually improved when these estimates arc NOT realized; for actual
values to be lower than original estimates is a good outcome. So to
include this metric in the same category as the other true performance
measures is misleading and understates the actual performance. While
the footnote in Figure 5 recognizes this, the accompanying text should
be accurate as well.
As a demonstration of the overall health of the EM project portfolio,
many sites are beginning to realize efficiencies and have brought
forth additional scope that may be completed within the FY2011
timeframe.
[End of section]
Appendix VI: GAO Contact and Staff Acknowledgments:
GAO Contact:
Gene Aloise, (202) 512-3841, aloisee@gao.gov:
Staff Acknowledgments:
In addition to the individual named above, Janet Frisch, Assistant
Director; Antoinette Capaccio; Ellen W. Chu; Heather Dowey; Jennifer
Echard; Jeff Larson; Mehrzad Nadji; John G. Smale Jr.; Stacey Steele;
Kiki Theodoropoulos; and Ginny Vanderlinde made key contributions to
this report.
[End of section]
Related GAO Products:
Department of Energy: Actions Needed to Develop High-Quality Cost
Estimates for Construction and Environmental Cleanup Projects.
[hyperlink, http://www.gao.gov/products/GAO-10-199]. Washington, D.C.:
January 14, 2010.
Nuclear Waste: Uncertainties and Questions about Costs and Risks
Persist with DOE's Tank Waste Cleanup Strategy at Hanford. [hyperlink,
http://www.gao.gov/products/GAO-09-913]. Washington, D.C.: September
30, 2009.
Department of Energy: Contract and Project Management Concerns at the
National Nuclear Security Administration and Office of Environmental
Management. [hyperlink, http://www.gao.gov/products/GAO-09-406T].
Washington, D.C.: March 4, 2009.
Nuclear Waste: Action Needed to Improve Accountability and Management
of DOE's Major Cleanup Projects. [hyperlink,
http://www.gao.gov/products/GAO-08-1081]. Washington, D.C.: September
26, 2008.
Nuclear Waste: DOE Lacks Critical Information Needed to Assess Its
Tank Management Strategy at Hanford. [hyperlink,
http://www.gao.gov/products/GAO-08-793]. Washington, D.C.: June 30,
2008.
Department of Energy: Office of Science Has Kept Majority of Projects
within Budget and on Schedule, but Funding and Other Challenges May
Grow. [hyperlink, http://www.gao.gov/products/GAO-08-641]. Washington,
D.C.: May 30, 2008.
Hanford Waste Treatment Plant: Department of Energy Needs to
Strengthen Controls over Contractor Payments and Project Assets.
[hyperlink, http://www.gao.gov/products/GAO-07-888]. Washington, D.C.:
July 20, 2007.
Department of Energy: Consistent Application of Requirements Needed to
Improve Project Management. [hyperlink,
http://www.gao.gov/products/GAO-07-518]. Washington, D.C.: May 11,
2007.
Department of Energy: Major Construction Projects Need a Consistent
Approach for Assessing Technology Readiness to Help Avoid Cost
Increases and Delays. [hyperlink,
http://www.gao.gov/products/GAO-07-336]. Washington, D.C.: March 27,
2007.
Hanford Waste Treatment Plant: Contractor and DOE Management Problems
Have Led to Higher Costs, Construction Delays, and Safety Concerns.
[hyperlink, http://www.gao.gov/products/GAO-06-602T]. Washington,
D.C.: April 6, 2006.
Nuclear Waste: Better Performance Reporting Needed to Assess DOE's
Ability to Achieve the Goals of the Accelerated Cleanup Program.
[hyperlink, http://www.gao.gov/products/GAO-05-764]. Washington, D.C.:
July 29, 2005.
Department of Energy: Further Actions Are Needed to Strengthen
Contract Management for Major Projects. [hyperlink,
http://www.gao.gov/products/GAO-05-123]. Washington, D.C.: March 18,
2005.
Nuclear Waste: Absence of Key Management Reforms on Hanford's Cleanup
Project Adds to Challenges of Achieving Cost and Schedule Goals.
[hyperlink, http://www.gao.gov/products/GAO-04-611]. Washington, D.C.:
June 9, 2004.
[End of section]
Footnotes:
[1] Pub. L. No. 111-5 (2009).
[2] This figure includes about $83 billion in actual costs from 1997
to 2009, according to DOE.
[3] GAO has found these sites to have had problems with rising costs,
schedule delays, and contract and project management. See GAO,
Department of Energy: Contract and Project Management Concerns at the
National Nuclear Security Administration and Office of Environmental
Management, [hyperlink, http://www.gao.gov/products/GAO-09-406T]
(Washington, D.C.: Mar. 4, 2009); GAO, Hanford Waste Treatment Plant:
Department of Energy Needs to Strengthen Controls over Contractor
Payments and Project Assets [hyperlink,
http://www.gao.gov/products/GAO-07-888] (Washington, D.C.: July 20,
2007); GAO, Nuclear Waste: Better Performance Reporting Needed to
Assess DOE's Ability to Achieve Goals of the Accelerated Cleanup
Program, [hyperlink, http://www.gao.gov/products/GAO-05-764]
(Washington, D.C.: July 29, 2005); GAO, Nuclear Waste: Department of
Energy's Project to Clean Up Pit 9 at Idaho Falls Is Experiencing
Problems, [hyperlink, http://www.gao.gov/products/GAO/RCED-97-180]
(Washington, D.C.: July 28, 1997). A list of GAO related products
appears at the end of this report.
[4] The 17 sites were Argonne National Laboratory (IL), Brookhaven
National Laboratory (NY), Energy Technology Engineering Center (CA),
Hanford Site Office of River Protection and Richland Operations Office
(WA), Idaho National Laboratory (ID), Los Alamos National Laboratory
(NM), Moab UMTRA Site (UT), Mound Site (OH), Nevada Test Site (NV),
Oak Ridge Reservation (TN), Paducah Site (KY), Portsmouth Site (OH),
Savannah River Site (SC), Separations Process Research Unit (NY), SLAC
National Accelerator Laboratory (CA), Waste Isolation Pilot Plant
(NM), and West Valley Demonstration Project (NY).
[5] GAO, Department of Energy: Major Construction Projects Need a
Consistent Approach for Assessing Technology Readiness to Help Avoid
Cost Increases and Delays, [hyperlink,
http://www.gao.gov/products/GAO-07-336] (Washington, D.C.: Mar. 27,
2007); GAO, Department of Energy: Further Actions Are Needed to
Strengthen Contract Management for Major Projects, [hyperlink,
http://www.gao.gov/products/GAO-05-123] (Washington, D.C.: Mar. 18,
2005); GAO, Hanford Waste Treatment Plant: Contractor and DOE
Management Problems Have Led to Higher Costs, Construction Delays, and
Safety Concerns, [hyperlink, http://www.gao.gov/products/GAO-06-602T]
(Washington, D.C.: Apr. 6, 2006).
[6] GAO, Department of Energy: Actions Needed to Develop High-Quality
Cost Estimates for Construction and Environmental Cleanup Projects,
[hyperlink, http://www.gao.gov/products/GAO-10-199] (Washington, D.C.:
Jan. 14, 2010).
[7] Our prior work found that technical problems (such as developing
sophisticated waste separation technologies) or legal and regulatory
issues (such as determining when a waste tank was clean enough to
close) handicapped acceleration of complex and costly projects; see
[hyperlink, http://www.gao.gov/products/GAO-05-764].
[8] To track projects, DOE assigns each project a number, which
corresponds to project baseline information. A complete list of DOE
Recovery Act projects, organized by site and project number appears in
appendix III. Project number OR-0040.R1 (see appendix III and IV).
[9] Project number OH-MB-0031.NEW.R1 (see appendix III and IV).
[10] Transuranic waste is waste containing more than 100 nanocuries of
alpha-emitting transuranic elements (radiation) per gram with half-
lives greater than 20 years with certain exceptions. A half-life is
the amount of time required for an element to decay by half, and
nanocuries are a measure of radioactivity. Alpha-emitting radiation
cannot pass through objects, including human skin, but is extremely
dangerous if inhaled or ingested.
[11] In this report, references to a project achieving its cost and
schedule targets means that the project is demonstrating an earned
value metric that shows positive cost and schedule performance as
assessed by the contractor's earned value management system. See
appendix IV for further information on how this metric is used.
[12] Project number SR-0013.R1.2 (see appendix III and IV).
[13] Project number OR-0040.R1 (see appendix III and IV).
[14] Project number ID-0040B.NEW.R1.3 (see appendix III and IV).
[15] This jobs number reflects reporting by DOE contractors and
represents a count of full-time equivalents for DOE's prime
contractors only. Per OMB guidance, this number represents jobs
created during the previous quarter (January through March 2010).
[16] Project number SR-0030.R1.2 (see appendix III and IV).
[17] Project number BRNL-0040.R1 (see appendix III and IV).
[18] Project number RL-0041.R2 (see appendix III and IV).
[19] DOE has certified that the earned value system used by its
contractors is reliable for all but one Recovery Act contractor
(Savannah River's liquid tank waste contractor). DOE does not require
contractors at three of the sites--Argonne National Laboratory,
Paducah, and SLAC National Accelerator Laboratory--to have their
earned value systems certified.
[20] Project number SR-0040.R1 (see appendix III and IV).
[21] Project number RL-0041.R2 (see appendix III and IV).
[22] Project number SR-0013.R1.1 (see appendix III and IV).
[23] Project number RL-0041.R1.3 (see appendix III and IV).
[24] Project number ID-0040B.NEW.R1.3 (see appendix III and IV).
[25] In 2001, DOE established DOE's Project Management Career
Development Program, which defines a project management career path
that includes certification, minimum training and continuing education
requirements, and project management responsibilities that are
commensurate with clearly defined qualifications. According to DOE
officials, all project directors overseeing Recovery Act projects are
certified at, or greater than, the level appropriate for the project
they are managing, which means that they have the qualifications to
oversee projects valued at more than $100 million. The requirements
are articulated in DOE order 361.1B, Acquisition Career Management
Program.
[26] Project number ID-0040B.NEW.R1.3 (see appendix III and IV).
[27] Project number SR-0013.R1.2 (see appendix III and IV).
[28] Project number CBC-ETEC-0040.R1.1 (see appendix III and IV).
[29] 42 U.S.C. 9601-9675 (2006).
[30] Project number CBC-ETEC-0040.R1.2 (see appendix III and IV).
[31] Project number OH-WV-0013.R1 (see appendix III and IV).
[32] Indefinite-delivery/indefinite-quantity contracts allow the
government to contract for indefinite quantities of supplies or
services during a fixed period. The government places delivery orders
(for supplies) or task orders (for services) in a base contract and
specifies minimum and maximum quantity limits, then places individual
orders as needed. 48 C.F.R.§§ 16.501-1,504(a) (2009).
[33] Federal Acquisition Regulations 52.204-11 governing the reporting
of job creation figures have changed, and, beginning with the third
quarter of fiscal year 2010, subcontractor FTEs will also be reported.
[34] DOE also estimated more than $3 billion in costs that would be
avoided because of Recovery Act funding. These include, for example,
accelerated shipments to the Waste Isolation Pilot Plant, which would
avert a schedule extension and continued operating costs.
[35] GAO, Nuclear Waste: Absence of Key Management Reforms on
Hanford's Cleanup Project Adds to Challenges of Achieving Cost and
Schedule Goals, [hyperlink, http://www.gao.gov/products/GAO-04-611]
(Washington, D.C.: June 9, 2004), and GAO-05-764.
[36] This $1.6 billion went solely to Hanford's Richland Operations
Office, one of two DOE administrative units at Hanford.
[37] Project number RL-0040.R1.1 (see appendix III and IV). Projects
labeled D&D by DOE generally consist of deactivation, decommissioning,
decontamination, demolition, or a combination of these activities.
[38] Project number RL-0041.R1.1 (see appendix III and IV).
[39] GAO, GAO Cost Estimating and Assessment Guide: Best Practices for
Developing and Managing Capital Program Costs, [hyperlink,
http://www.gao.gov/products/GAO-09-3SP] (Washington, D.C. Mar. 2,
2009).
[40] Project number SR-0013.R1.2 (see appendix III and IV).
[41] As of June 2010, DOE is updating this project's cost and schedule
targets because of changes to the allowable container size for
shipping and disposing of transuranic waste.
[42] Project number SR-0030.R.1.1 (see appendix III and IV).
[End of section]
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