$73M in WIPP leak fines to pay for roadwork, other projects

Posted: Friday, May 1, 2015 12:15 am | Updated: 8:18 am, Fri May 1, 2015.

By Patrick Malone
The New Mexican

Federal taxpayers will pay about $73 million for highway improvements and other projects in New Mexico as a penalty for a series of failings at U.S. Department of Energy facilities that culminated in a radiation leak last year at the Waste Isolation Pilot Plant near Carlsbad.

The monetary award, part of a settlement agreement between the federal agency and the state, was announced Thursday by Gov. Susana Martinez. Her administration had proposed hefty fines for blunders that created a highly volatile drum of waste at Los Alamos National Laboratory.

WIPP improperly accepted the drum, and the laboratory admitted to the container’s actual contents only after the radiation leak.

The money will be earmarked for targeted projects rather than provided as a cash payout to the state’s overall budget. This spares the private contractors that operate both nuclear sites from any financial responsibility.

Though that rankled some watchdog groups, a senior Department of Energy official told reporters Thursday that much of the money for the settlement will come out of performance fees that were withheld last fiscal year from Los Alamos National Security and Nuclear Waste Partnership, the consortia of private contractors that the Energy Department pays to operate LANL and WIPP, respectively.

The settlement requires the Department of Energy to pay for $46 million in improvements on roads leading to WIPP, including a worn 13-mile stretch between the below-ground nuclear waste repository and Carlsbad and the truck route that runs for hundreds of miles between Los Alamos and Carlsbad.

Another $10 million will be devoted to water infrastructure improvements at Los Alamos, and $9.5 million will pay for stormwater monitoring and projects around the lab. The settlement also calls for $5 million to build an emergency operations center in Carlsbad to provide training for emergency responders and mine rescue teams. Also, $2.75 million will fund independent oversight reviews at the Department of Energy sites.

In December, Martinez and Ryan Flynn, Cabinet secretary of the New Mexico Environment Department, hand-delivered to U.S. Energy Secretary Ernest Moniz documents proposing to fine the federal department $54 million for the circumstances leading up to the Feb. 14, 2014, radiation leak. Flynn threatened to tack on more than $100 million in additional fines if the U.S. Department of Energy, which initially contested the original fines, dragged out negotiations.

“Making sure [Energy Department nuclear sites] operate safely is non-negotiable,” Martinez said at a news conference.

The Republican governor described the settlement as the largest ever between the federal agency and a state. A senior Energy Department official could not confirm the accuracy of the statement.

New Mexico’s U.S. senators, Democrats Tom Udall and Martin Heinrich, hailed the agreement for the water and road improvements it will fund. Heinrich called the settlement “a smart solution,” and Udall said he encouraged Moniz multiple times to seek resolution with the state. That contradicts Martinez’s statement that New Mexico’s congressional delegation played no role in the pact.

Greg Mello, executive director of the watchdog organization Los Alamos Study Group, questioned whether the projects funded by the fines truly address the circumstances that led to the leak.

Federal investigations found LANL erred by using organic kitty litter as an absorbent and an organic acid neutralizer, which were incompatible with the oxidizing agents in nuclear waste. Together, these ingredients caused the conditions that led to a drum of waste rupturing at WIPP and causing the radiation leak. In its formal description of the waste drum’s contents, LANL made no mention of its most volatile and incompatible contents.

“I’m a little flabbergasted as to the whole idea that the state would negotiate what the money is used for. … What does that have to do with [Resource Conservation and Recovery Act] violations?” Mello said. “It seems like an entirely different sphere.”

Mello also raised questions about a provision in the settlement agreement that creates a new oversight process for reviews of WIPP and LANL every three years, separate from the regulatory authority of the New Mexico Environment Department.

“NMED agrees to refrain from taking any enforcement action against the DOE Permittees, their constituent agencies, contractors and affiliates for any violations identified in the triennial reviews so long as the DOE Permittees and their facility operators correct any deficiencies identified in the course of such reviews,” the agreement states.

The projects the Energy Department agreed to fund in the settlement are needed maintenance that Mello argued should be on its to-do list even without the threat of enforcement action.

Flynn, the state Environment Department secretary, said groups such as the Regional Coalition of LANL Governments and the Carlsbad Mayor’s Nuclear Task Force “heavily influenced the settlement” and advocated including the projects in the agreement. Those taxpayer-funded organizations and others like them in communities that rely on nuclear installations for economic development frequently lobby Congress and regulators on behalf of Energy Department sites and their contractors.

“It seems like those two local communities have their chips in here,” Mello said, “and they got their pet projects.”

Mello said that, despite his objections to parts of the agreement, he was pleased that it did not reward the private contractors paid to operate the lab with new high-paying tasks.

Scott Kovac of the Santa Fe-based nonprofit watchdog Nuclear Watch New Mexico also saw good and bad in the settlement.

“It’s great that the fines did not come out of LANL’s cleanup budget …” he said in an email. “But have the for-profit contractors that run these facilities learned anything, except that Daddy DOE will bail them out?”

At WIPP, Nuclear Waste Partnership was paid just $21,576 of the $8.1 million in possible incentive payments it could have received for performance for the fiscal year that concluded at the end of September.

And LANL stood to collect up to $63 million in fees, but instead was awarded only $6.25 million because of its role in the WIPP leak. Even more costly to its primary contractor, Los Alamos National Security — the consortium of Bechtel, Babcock and Wilcox Technical Services, URS Energy and Construction and the University of California — the Energy Department stripped it of what amounts to two years of its $2.2 billion annual contract.

Contact Patrick Malone at 986-3017 or pmalone@sfnewmexican.com. Follow him on Twitter @pmalonenm.