For immediate release March 1, 2016

Inspector General Review Finds Poor Internal System for Correcting Problems at LANL

Contact: Greg Mello, gmello@lasg.org, 505-265-1200 or 505-577-8563

ALBUQUERQUE – Today the Department of Energy Office of Inspector General (DOE OIG) released a highly critical, detailed review of Los Alamos National Laboratory’s (LANL’s) corrective action program, the formal program that responds to and corrects management issues once they come to LANL management’s attention, including and especially health and safety issues (“Issues Management at the Los Alamos National Laboratory," DOE-OIG-16-07).

LANL is managed by Los Alamos National Security (LANS, LLC). All LANL employees, from Director Charles McMillan on down, are LANS employees. The deficiencies identified by the OIG are those of LANS and its management.  

The OIG reviewed 460 issues identified by LANS itself in its corrective action system. In typical understated language, the OIG’s review disclosed “significant weaknesses” that “adversely affected the usefulness of the corrective action program and the differing professional opinions (DPO) process.”

Overall, LANL “did not always adequately address issues, did not effectively prevent their recurrence, and did not consistently identify systemic problems,” a conclusion they back up with damning detail.

The OIG notes (on p. 6) that the LANS subcontracts for design of the Chemistry and Metallurgy Research Replacement Nuclear Facility (CMRR-NF), a failed project that cost taxpayers $500 million (M) over a decade with nothing to show for it,[1] and the LANS failures in transuranic (TRU) waste packaging that contaminated and temporarily closed the Waste Isolation Pilot Plant (WIPP) at a comparable cost, were associated with subcontracts that lacked required procedures for vetting differing professional opinions.

The OIG notes that deficiencies in the corrective action system are implicated in the long shutdowns of the LANL tritium facility (8 years) and main plutonium facility (since June 2013, to varying degrees) (see pp. 4, 5, 6, 8, and 9).

As these examples show, the OIG assesses these failures documented in this report as profoundly consequential.

The OIG ties the current analysis to several prior in-depth OIG investigations of LANL (i.e. LANS) deficiencies (summarized, pp. 16-17) as well as to Performance Evaluation Reports (PERs). The National Nuclear Security Administration (NNSA) has not released the FY2015 PER as of this writing.[2]

DOE management concurred with the OIG findings.

Study Group director Greg Mello:

“The OIG’s findings are extremely serious, a wake-up call for everybody concerned with good management at LANL. They tie together a lot of LANL’s problems and illustrate why serious problems keep recurring.

“There is simply no serious commitment, or effective system in place, to understand and correct problems at LANL. If there were we wouldn’t see the problems we do, and the OIG would be able to see that effective system. They couldn’t find one. LANL is just far too complex to manage without an effective, formal corrective action program.

“These requirements are not being arbitrarily imposed by DOE. They are exactly what LANL and other contractors have themselves asked for, and keep asking for. ‘Just tell us what you want done, not how to do it,’ they say, ‘let us fix our own problems.’ But as this report documents, LANS has no working system in place to fix its abundant management problems.

“This report is just one of hundreds of external reviews that could be cited detailing serious problems at LANL. The problems seem to recur endlessly, with variations. Only the names change.

“Nothing that has been tried to date has been successful in fixing LANL, as performance evaluations show. No reforms within the present system will be successful. LANL’s problems are deeply structural, and it is there that we must look for answers.

And even now there is no real accountability at LANL. There never is.

“We recommend the following, to NNSA and Congress:

• Promptly pause all LANL operations involving high-significance issues which, in the summary judgment of NNSA and the DOE IG, have not received appropriate analysis and corrective action.
• Initiate a process to change LANL to a government-owned, government-operated (GOGO) facility. Here are the steps:
• Substitute federal employees for LANS employees, starting at the top. All LANS employees involved in program efforts would remain, as would most mid-level LANS line managers, at least at first. Senior LANS staff would have the option of applying for federal status.
• Institute a voluntary, incentivized reduction in force for LANS workers doing administrative tasks related solely to the present privatized nature of LANL.
• Initiate a program to support and train young engineers and scientists with scholarships and loan forgiveness aimed at bolstering NNSA federal service, as was once done for the old Atomic Energy Commission (AEC).
• Gradually eliminate the Los Alamos Site Office (LASO) and its external oversight functions as its staff and functions migrate to LANL.
• Fund the necessary corrective actions through the considerable economies realized by replacing senior LANS management with senior federal civil servants, plus the elimination of strictly corporate functions, plus the released portion of a) management fee, b) gross receipts tax, and c) LANS pension contributions.
• LANS or another contractor would remain as the employer of most LANL staff, with a heavily restructured contract more akin to a workforce augmentation or professional services contract.
• With a new management team in place, initiate a complete budget and program “scrub” to bring LANL’s programs in closer alignment with national objectives and the realities of its location.

Further background for these recommendations can be found in LASG comments to the Commission to Review the Effectiveness of the National Energy Laboratories (CRENEL), Sep 26, 2014.

****ENDS****

[1] The LASG analysis linked shows $635.1 M was appropriated through FY2012 for CMRR-NF. Roughly $135 M of these funds were reprogrammed after CMRR-NF was indefinitely delayed, leaving about $500 M spent.  

[2] On February 24, 2016, Bechtel representative Bob DeGrasse told me (Greg Mello) that the action of NNSA to not release the LANS PER was the result of a request by LANS related to extending the LANS contract beyond September 30, 2017, the current termination date. For background see this page.