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Y-12 NATIONAL SECURITY COMPLEX

OPERATIONS

The Oak Ridge Office (ORO), formerly the Oak Ridge Operations office established the NNSA's Y-12 Site Office (YSO) to oversee contractor activities and manage operation of the Y-12 National Security Complex. Y-12 managed and operated by Babcox & Wilcox Technical Services Y-12, LLC (B&W Y-12 formerly BWXT Y-12 LLC), for the NNSA and is part of DOE's Nuclear Weapons Complex. The contract which was awarded in 2000 extends until September 30, 2010.

Y-12 was formerly operated by Lockheed Martin Energy Systems (LMES). LMES was the integrating contractor. LMES (or its predecessor organization) operated Y-12 beginning in 1984. The LMES contract was due to expire in March 1996; however, an extension through March 1998 was authorized in 1995. The contract extension required that Oak Ridge National Laboratory be placed under a separate contract, which was negotiated with a new entity, Lockheed Martin Energy Research Corp., effective January 1996 and extending through March 1998. LMES announced workforce downsizing on August 26, 1996. The total downsizing announced by ORO in May 1995 was estimated to total 900 LMES jobs by the end of fiscal year (FY) 1996. These reductions were in anticipation of lower budgets in FY 1997 as well as completion of previously funded projects, restructuring, and reorganization. A performance-based management contract was negotiated and signed with LMES in August 1995, effective October 1995 through March 1998. It incorporated all of the major elements of the Department's contract reform initiative: providing objective vs. subjective performance measures, establishing performance incentives through multiple fee arrangements, emphasizing and providing incentive for cost reduction, shifting of risk and liability to the contractor. On August 6, 1996, the Department announced its decision to extend the contract with LMES for the operation of the Y-12 Plant for two years, through March 2000. The primary reason for this decision is to avoid any disruption of some critical Department of Defense requirements.

Budget and Employment

In FY 2006 the budget was $900 million. The estimated site budget was $469.8M for FY 1996, $482.1M for FY 1997, $612.8M for FY 1998. A total of 6,000 personnel are employed on site, including 4,500 B&W Y-12 personnel, 72 NNSA personnel, and others from UT-Battelle, Science Applications International Corporation, Bechtel Jacobs Company, and Wackenhut Services. In July 1996, 4,000 personnel were employed, representing a reduction from 6,388 in September 1994.