STATEMENT OF ADMIRAL JAMES D. WATKINS, USN (Ret.)
SECRETARY OF ENERGY
U.S. DEPARTMENT OF ENERGY
before the
COMMITTEE ON ARMED SERVICES
U.S. SENATE
ATOMIC ENERGY DEFENSE ACTIVITIES (050 ACCOUNT)
April 18, 1991
Mr. Chairman and Members of the Committee, I am pleased to appear before
you today to present an overview of the Department of Energy's FY 1992
budget request for those national security programs funded by the 050
Atomic Energy Defense Activities Account. Programs in this category are
administered by the Offices of Defense Programs; Environmental
Restoration and Waste Management; New Production Reactors; Naval
Reactors Program under the Office of Nuclear Energy; Security Affairs;
Security Evaluations under the Assistant Secretary for Environment,
Safety and Health; and Intelligence.
Before I continue, I would like to thank the Members of the Committee
for your support of the Department's $623 million FY 1991 Supplemental
Authorization request. These funds will be used to assure that all
necessary safety, security and environmental steps are taken to permit
the resumption of plutonium manufacturing operations at Rocky Flats
Plant, and for several high priority Environmental Restoration and
Waste Management activities. Your continued support is an important
ingredient in helping me change the course at the Department of Energy.
As new dimensions take shape--sounder environmental stewardship,
downsizing the production complex, and assuring the construction of a
new production reactor for the 21st century--I look forward to working
with you to secure the necessary resources and support to carry out
effectively and completely the vitally important national security
missions of the Department of Energy.
Overview
Nuclear deterrence has been the cornerstone of our national security
policy since the end of World War II. It has been essential in
preserving world peace and will remain a vital element of our national
defense strategy for the foreseeable future. This is not to say that
the world situation has not changed since I became Secretary of Energy.
Rather, we find that nuclear stockpiles in Europe are being reduced and
arms control treaties with the Soviet Union offer the promise of further
number and mix of nuclear weapons in our stockpile are defined in the
reductions in nuclear weapons. Regardless of that future promise, the
Nuclear Weapons Stockpile Memorandum, which is negotiated between the
Departments of Defense and Energy, approved by Secretary Cheney and me,
and then forwarded to the President for final approval. Irrespective
of ultimate stockpile requirements, federal budgets will be increasingly
constrained, a trend that can be expected to continue. These and other
impacts on the Department's national security programs are profound and
must be considered as we position ourselves to move into the 21st century.
The Department's overall Atomic Energy Defense Activities budget
request for FY 1992 is $11.8 billion, almost two-thirds of the
Department's total budget. The request is comprised of $6.75 billion
for Defense Programs which includes $159 million for Security Affairs,
and $50 million for Intelligence; $3.7 billion for Environmental
Restoration and Waste Management activities; $500 million for the New
Production Reactors Program, $801 million for the Naval Reactors program;
and $15 million for Security Evaluations.
Since the submission of the President's FY 1992 budget, the Department
of Defense has decided not to fund the B 90 weapons system production
activities in FY 1992. We are working closely with cognizant
congressional staffs to allow DOE funding in FY 1992 for this weapons
system to be reallocated to high priority needs such as the W 79 change
requirement recently validated by the Secretary of Defense, support for
increased weapon retirements, and other priority funding of Weapons
an expanded nuclear weapon disposal capability at Pantex to handle
Production and Surveillance requirements.
I will describe my objectives for the programs comprising DOE's portion
of the 050 account and the immediate concerns I see facing the
Department of Energy. During 1991, my priority goals under the Atomic
Energy Defense Activities Account are to achieve the following:
o Conduct safe restart of the first production reactor at the Savannah
River Site in South Carolina after a nearly three-year shutdown for
safety deficiencies.
o Conduct safe resumption of plutonium processing operations at the
Rocky Flats plant in Colorado after a more than one year shut down
for significant operational weaknesses.
o Conduct safe start of the operational research test program at the
Waste Isolation Pilot Plant (WIPP) in New Mexico to demonstrate
compliance with disposal requirements for radioactive transuranic
wastes.
o Resolve the safety concerns related to the waste tanks at the
Hanford site in Washington State.
o Issue the Record of Decision for New Production Reactor capacity
in December.
o Continue to make significant progress in improving the safety,
security, control and effectiveness of our nuclear weapons stockpile.
o Continue efforts at Headquarters and each DOE facility to
implement recommendations of the Secretary's Safeguards and Security
Task Force, which I commissioned, and other initiatives to enhance
protection of facilities, special nuclear materials, nuclear weapons
and their component parts and classified information.
As I noted earlier, this is an important year for the Department. It
has not been easy getting to this point. I want to share with you
the dilemma I faced regarding decisions for the Atomic Energy
Defense Activities programs.
I believe the Department's budget, including the FY 1991 supplemental,
is the rock bottom amount required to support our national security
programs in a safe and environmentally sound manner. This budget was
arrived at only after much soul searching that included the deferral of
many critical activities and severe cuts in our weapons production
complex, in our weapons research and development program, and in our
program to pursue new production reactor capacity to replace our aging
reactors.
The following chart depicts the current problem facing the Department
in balancing all of its national security activities.
[[[[[[ a graphical chart can be found with the original ]]]]]]
This growth in resources allocated to environmental management is of
particular concern to me since there are a significant number of
uncertainties still confronting the Department as it strives to meet
the requirements of applicable environmental statutes. Most of our
sites are still in the characterization phase where problems are still
being identified and proposed solutions studied. Once the study phase
is over, we can anticipate further cost increases as the actual cleanup
contributor to the uncertainty of the costs associated with achieving
work begins on schedules with statutory milestones. Another
compliance with environmental laws is the increasing number of
compliance agreements we are negotiating with the States and the
Environmental Protection Agency. When setting the requirements
in these agreements, there is no incentive for the regulators to
demand less than full compliance, as soon as possible, regardless
of the degree of risk associated with any non-compliance
condition that may develop. And their position is being supported
through litigation. This situation puts the Department in a
difficult position from the standpoint of controlling budgetary growth,
since these resource requirements are driven, to a great degree, by our
regulators.
I am certain that the budgetary requirements for the Environmental
Restoration and Waste Management effort will expand as environmental
compliance and cleanup becomes better defined. That is why I am very
uncomfortable with the trends that are portrayed on the chart.
Status of the Nuclear Weapons Complex
Over the past two years as Secretary of Energy, one of my key concerns
has been correcting the problems brought about by past neglect in the
management of the Department's nuclear weapons complex. As a result of
my Ten Point Plan, issued in June 1989, to move the Department toward
full accountability and compliance with environmental, safety, and
health laws, we have made good progress toward achieving our
objectives.
From the onset, it was clear that instilling a new operating culture
would take time and that new challenges and changing circumstances
would require revisions to planned timetables. Nevertheless, we have
made real and measurable progress in implementing new operating
policies and procedures to bring the Department into compliance with
Federal and State environmental, health, and safety regulations.
Achieving both production and environmental, safety and security
objectives are compatible goals.
Operations at the Savannah River Site and Rocky Flats Plant will not
resume until I am completely satisfied that they can be operated in a
manner that assures the health and safety of the public and our
workers, protects the environment, and complies with the Department's
safeguards and security requirements. I will not be driven by rigid
schedules. Furthermore, I remain committed to correcting existing
deficiencies. The programs we have in place are sound. I am optimistic
about our ability to achieve these goals in 1991.
Savannah River Reactors
On February 4, 1991, I signed the Record of Decision (ROD), completing
the National Environmental Policy Act (NEPA) process, which reflects my
decision to continue to operate the K Reactor at the Savannah River
Site, defer until later the operation of the L Reactor, and defer
indefinitely the operation of the P Reactor.
Important milestones must still be achieved before the K Reactor can be
ready for operation this summer, including: continuing with the safety
upgrades as outlined in the Safety Evaluation Report; preparing for an
Operational Readiness Review prior to a decision to restart; preparing
an action plan for mitigation of any environmental impacts associated
with the restart; completing system testing and security reviews. These
and other milestones must be successfully completed; and I must be
personally assured that applicable environmental, safety, health and
security considerations have been satisfied before I will authorize the
restart.
Plutonium Operations at Rocky Flats Plant
Also, this summer, I expect to authorize resumption of operations in
the analytical laboratory, Building 559, at Rocky Flats. Although the
laboratory is not a production facility, I believe it is prudent to use
startup of the laboratory as a critical verification tool for other
buildings at the plant.
But again, I will not authorize resumption at Rocky Flats until I am
personally satisfied that applicable environment, safety, health, and
security considerations have been fully addressed. If all goes
according to plan, I expect that pit fabrication at Rocky Flats will
resume later this calendar year.
As you know, it is vitally important that Savannah River and Rocky
Flats resume operations in order to meet national defense requirements.
This is especially important in view of the critical role these
facilities have in the maintenance of our existing nuclear weapons
stockpile and in improving the safety and security of the future
stockpile.
Nuclear Weapons Safety
I have reviewed in detail the recommendations which the Drell Panel has
made to the Congress regarding the safety of nuclear weapons in the
stockpile. Both Secretary Cheney and I support the thrust and
intent of the Drell Panel's recommendations, and we have charged the
Nuclear Weapons Council to carry out promptly a course of action to deal
with these recommendations.
Environmental Restoration and Waste Management
The Department is committed to managing its facilities in an
environmentally sound manner, restoring environmentally damaged sites,
promoting environment, safety and health oversight, and safely
disposing of nuclear waste. Environmental Restoration and Waste
Management (EM) is the fastest growing program area in the Department.
My Five-Year Cleanup Plan is the cornerstone of the Department's
long-term strategy to consolidate and coordinate the Department's
billion being proposed under the Atomic Energy Defense Activities
cleanup activities. The FY 1992 EM budget request contains $3.7
appropriation. This is an increase of approximately $1 billion over
the FY 1991 appropriation.
In order to clearly define the future course of this program, I have
directed that a Programmatic Environmental Impact Statement (PEIS) be
prepared for the Department's Environmental Restoration and Waste
Management activities. Twenty- three public scoping hearings related to
this PEIS were conducted throughout the country. Let me emphasize that
this effort must be maintained independent of the PEIS for Complex
Reconfiguration. The missions of these two programs is significantly
different. Although future complex operations will generate additional
compared to the large amount that already exists in the complex and
waste for disposal, these volumes will be relatively small when
must be managed under rigid regulations. These two efforts will be
thoroughly coordinated to assure consistency, but they must be
independently maintained.
Implementation of the Environmental Restoration and Waste management
program is indicative of our determination to manage the Department
complex in an environmentally acceptable manner. There are sound
reasons for the requested approximate one billion dollar program
growth. Constraints on the 050 account dictate that we closely examine
future program requirements, but the challenges are significant. For
approximately one billion dollars from preliminary program estimates
instance, in the process of validating requirements, we cut
that came in from field activities and were fed into the Five Year
planning information. In addition, closure of facilities and the
transfer of activities from other programs represented approximately
$700 million worth of real EM requirements. The infrastructure
necessary to manage this program must be expanded to assure that
funding. In 1992, the amount of real growth in this program in the
appropriate controls are in place to effectively expand this level of
defense area is only about 11 percent.
Part of this real growth is driven by the significant increase in the
number of compliance agreements negotiated with the States and the
Environmental Protection Agency. At the end of FY 1990, 59 such
agreements were in place; at the end of 1991, this number will increase
to 82 with even more anticipated by the end of FY 1992. However, there
is considerable uncertainty associated with negotiating the
uncertainty is the fact that the Resource Conservation and Recovery Act
requirements of some of our agreements. A major contributor to this
(RCRA), which governs many of these agreements, was not written to
provide specifically for mixed waste. Mixed waste is generically
defined as having both radioactive and hazardous waste present and
constitutes the major portion of the material in the Department
complex. Therefore, the uncertainties of the regulatory
requirements are of particular concern. It is essential that this
situation be remedied during the current RCRA reauthorization process
so that the Department can focus its attention on a consistent cleanup
program.
I am particularly pleased with our efforts in starting to manage the
significant volume of Department waste and in minimizing current waste
generation, as well as achieving parallel progress in environmental
restoration. The nation's first geologic repository, the Waste
Isolation Pilot Project or WIPP, is essentially completed. The test
phase for the facility is scheduled to begin in June or July of this
in achieving final disposal of the nation's transuranic waste. Another
year. The ultimate opening of this facility is the essential component
major step forward in waste management is the testing of the Defense
Waste Processing Facility at Savannah River. This facility, which is
currently in the cold operations phase, is a major link in the program
designed to accomplish the ultimate disposal of the large volume of
high level waste that is currently stored in underground tanks at
Savannah River.
In the area of environmental restoration, we are starting to make a
dent in the substantial cleanup task that confronts us. Remedial
assessments and major closures are proceeding on schedule. For example,
to date, we have met 78 of 82 major compliance agreement related
milestones in the Hanford Tri Party Agreement. Significant volumes of
contaminated materials have been removed from Grand Junction and Rocky
completed decontamination and decommissioning at the Los Alamos reactor
Flats in Colorado and the Hanford solar basins. We have facilities and
at a number of hot cells and buildings throughout the Department complex.
The technology development activity in EM stated that we would
initially try to come up with faster, better, safer and cheaper ways
to accomplish the cleanup tasks. The Integrated Demonstration at
Savannah River for treating ground water has been our first unqualified
success. The initial test removed 15,000 pounds of trichloroethylene in
75 days in comparison to the existing system of pump, strip and treat
that removed 15,000 pounds of trichlorethylene in 2 1/2 years at a cost
of $54 million compared with a cost of $3 1/2 million for the
integrated demonstration.
Sustained progress in the area of environmental restoration and waste
management is essential if the Department is going to continue to
exhibit environmental responsibility. I am certain that the budgetary
requirements for this program will continue to be assessed as the task
of environmental compliance becomes better defined, unique special
nuclear materials throughout the complex are classified as wastes and
additional facilities are removed from service. We need to develop new
construction projects. If implemented, the new requirements for recycle
requirements allowing the recycle of old material for use in new
have the potential to reduce both the amount of waste requiring
disposal and overall program costs.
Reconfiguration of the Nuclear Weapons Complex
To assure that our nuclear weapons complex can meet future national
security requirements, I directed that a plan be developed for
reconfiguration of the nuclear weapons complex to assure that a safe,
reliable, and efficient complex is available over the long term to
support the nuclear deterrent. On February 7, 1991, I released to the
public the Nuclear Weapons Complex Reconfiguration Study and provided
individual copies to the members of this Committee. I am convinced that
the Department's mission to produce defense materials is compatible with
protection of the environment; one need not be sacrificed to obtain the
other. This plan is the first step in bringing that about. We are now
conducting an in- depth examination of the proposals contained in the
Study, beginning with the preparation of a Programmatic Environmental
Impact Statement (PEIS). The firm of Tetra Tech Inc., of Pasadena,
California, has been selected to support the Department in the
preparation of the PEIS. Public participation is encouraged in the
public scoping meetings now under way near each of the major DOE sites,
here in Washington, and when we publish the draft PEIS scheduled for
November 1992. Three such meetings have been held to date and a fourth
meeting is scheduled this week near the Department's Pinellas Plant in
Florida.
The PEIS will examine a number of options, ranging from no action to a
restructuring that could reduce the complex from its present 13 sites
to six or seven. Preferred options include relocating the Rocky Flats
Plant to a new facility employing improved technology to minimize
environmental and health impacts while facilitating economy of
operation. Also preferred is consolidating nonnuclear manufacturing
activities at one dedicated site. Other possible changes include
sector; decommissioning at least one facility entirely; and examining
transferring many nonnuclear manufacturing activities to the private
the missions, facilities and operations of the three research and
development laboratories for changes that could result in satisfying
essential weapons requirements while streamlining research, development
and testing facilities.
The Department's plans for reconfiguration of the complex will require
substantial resources at a time of significant federal budget
constraints. In the meantime, significant resources must be devoted to
maintaining the present complex and assuring it can carry out its
production mission with required attention to health, safety, security,
and the environment. Providing the funding for transition and
reconfiguration is considered necessary to ensure continued viability
of our nuclear deterrent.
New Production Reactors Program
The mission of the New Production Reactors (NPR) Program is to provide,
on an urgent schedule, new production reactor capacity in a safe and
environmentally sound manner for an assured supply of nuclear
materials, primarily tritium, to maintain the Nation's deterrent
capability. Future defense nuclear materials production cannot be met
indefinitely with our present reactor capacity, which will be over 45
years old when new reactor capacity is scheduled to begin production.
and sustaining this Nation's defense policy of nuclear deterrence. The
The ability to produce tritium is a critical component to fulfilling
proposed, state-of-the-art, new production reactor would provide, on
an urgent schedule, the means necessary for the reliable production of
tritium in a safe and environmentally sound manner well into the next
century.
To achieve this objective, I have decided that the former strategy of
concurrently designing and constructing two new production reactors at
two sites can no longer be supported given the multiple competing
priorities within the Atomic Energy Defense Activities Account. My new
strategy, as outlined in our FY 1992 budget request, is to continue
the preliminary designs of both the Heavy Mater Reactor and the Modular
High-Temperature Gas-Cooled Reactor, complete the final Environmental
Impact Statement in November 1991 and then, make a final choice at the
Record of Decision in December 1991. At that time, the Department will
select one technology and one site, utilizing all safety, environmental,
technical, and cost and schedule data needed to make the most sound and
complete decision possible. Then, depending upon the decision, we
will proceed to complete the design and construction of a single
reactor technology at the chosen site. The design of the technology not
selected will be terminated in an orderly fashion. As a contingency,
the light water reactor target development effort will continue until
its completion.
The requested FY 1992 funding level of $500 million for the New
Production Reactor Program consists of $152.3 million in operating
budget authority; $336.5 million in construction funds for design and
$11.2 million for capital equipment. These funds are needed to support
the continued broad range of activities necessary to bring new
production reactor capacity on line.
On April 10, 1991, the draft Environmental Impact Statement on the
siting, construction and operation of new production reactor capacity
was released to the Congress. This begins a 60-day public comment
period which will end in June. During that time, the Department will
conduct 13 public hearings in five states (South Carolina, Georgia,
Idaho, Oregon, and Washington) regarding this proposed action. The
final EIS is scheduled to be completed in November 1991, with the
Record of Decision scheduled for December. In the immediate future,
the NPR Program will proceed with those activities necessary to complete
the final EIS, concurrently with engineering development, confirmatory
testing and project design efforts. These activities will all lead to
supporting detailed design and construction as soon as possible after
the Record of Decision.
The Weapons Research and Development Laboratory
To meet national security requirements, our National Laboratories at
Los Alamos, Lawrence Livermore, and Sandia carry out research,
development, and testing of nuclear weapons. They also perform the
vital function of monitoring the stockpile to assure continued safety,
security and effectiveness. This core mission has been the
technical cornerstone of our nuclear deterrent since its inception with
research expanding the frontiers of science and technology. They have
the Manhattan Project. In addition, these laboratories engage in vital
made substantial contributions in such fields as materials research,
chemistry, nuclear physics, solid-state physics, microelectronics,
mathematics, and computer science. As testament to this versatility,
our weapons laboratories made substantial contributions to Operations
Desert Shield and Desert Storm.
Meanwhile, I am very concerned with the downward trend in laboratory
staffing which has resulted from increasingly constrained Federal
budgets. Since FY 1987, there has been a decline in laboratory
personnel dedicated to weapons research, development, and testing of
nearly 30 percent; in addition, laboratory employment in this core
program is expected to decline by an additional 6 percent during FY
1991, resulting in the loss of approximately 500 additional positions.
Moreover, it is anticipated that reductions in the defense budget will
also significantly impact the laboratories inasmuch as approximately 25
percent of laboratory funding has been associated with work for others,
largely funded by the Department of Defense.
The erosion of laboratory technical capability is a major concern to
me. In recognition of this and changing national priorities, I have
established a task force under the Secretary of Energy's Advisory Board
to develop plans to help me better utilize the intellectual capital in
our national laboratories. This task force will review and recommend
changes in the roles and responsibilities of these laboratories, while
preserving the core mission of weapons research, development, and
testing. During the coming year, I expect a report which will provide a
framework for utilizing these assets to maximize military and economic
security objectives and to meet changing national priorities.
One of those future priorities that our Defense Programs laboratories
are actively pursuing is technology transfer. We have worked aggressively
to develop an enhanced program to improve the process by which we transfer
knowledge from the laboratories and into the economy. We are increasing
our funding for technology transfer at our defense laboratories by 60
percent in FY 1992. If the United States is to maintain its competitive
edge and remain a leading economic power, we must move quickly to adapt
this technical knowledge to our practicalneeds.
Naval Reactors
Naval Reactors' objectives remain unchanged from last year -- they are
charged with providing militarily effective Naval nuclear propulsion
plants and ensuring their continued safe and reliable operation. Naval
Reactors' outstanding safety and environmental record -- 3,800
reactor-years of operation without a reactor accident or significant
impact on the environment -- is the most eloquent statement of the
tremendous job they're doing.
Naval Reactors' success is the result of hard work, dedication, and a
philosophy of personal responsibility for safety, control of
radioactivity, and environmental preservation. The FY 1992 request of
approximately $801 million supports their "cradle-to-grave"
responsibilities for Naval nuclear propulsion and includes such key
work efforts as:
o Keeping Advanced Fleet Reactor (AFR) work on-schedule for
the SEAWOLF Class attack submarine; AFR is planned to be
tested in the existing land-based S8G prototype plant prior
to fleet introduction;
o Maintaining an integrated, comprehensive research and
development effort, including work on new plant and reactor
equipment concepts and post-AFR reactor development;
o Continuing land-based prototype reactor operations,
maintenance, and servicing to ensure an effective testing
effort which will meet programmatic needs well into the next
century;
o Meeting all environmental, safety, security, and health
requirements;
o Ensuring that continued technical excellence and high quality
mark all Naval Nuclear Propulsion Program work; and
o Providing enriched materials to meet Naval fuel needs.
Nuclear-powered warships remain an essential investment even in times
of defense "belt-tightening" -- nuclear attack submarines and surface
ships provide unparalleled flexibility in reaching global trouble spots
and delivering measured responses, while fleet ballistic missile
submarines are the most reliable leg of the strategic defense triad.
The nuclear fleet is a cost-effective backbone for the strong Navy we
need to protect our maritime interests now and into the 21st Century.
Intelligence
The Department faces daily challenges of a global nature spanning the
spectrum from national defense and energy security issues to issues
involving nuclear reactor safety and nuclear waste disposal. To meet
these challenges, the Department's intelligence element was reorganized
in April of 1990 with an expanded mission to provide special support
over a broader range of issues. The primary missions of the reorganized
element are to ensure that the Department's intelligence information
requirements are met and to provide specialized DOE intelligence
expertise to other elements of the Intelligence Community.
During FY 1990, the Department provided support to the nation's top
intelligence priorities as identified by the President's Foreign
Intelligence Priorities Committee. These efforts continue during the
current fiscal year.
In addition to ongoing activities, the Department provided support to
Operations Desert Shield and Desert Storm in a wide range of areas.
Activities included analysis of energy impacts and the potential
economic, environmental and military impacts of the Iraqi use of oil as
a defensive weapon. Finally, the Office of Intelligence provided the
Joint Chiefs of Staff and Defense Intelligence Agency with assessments
of the Iraqi nuclear weapons program and its capabilities.
The FY 1992 request reflects a $8 million increase over the FY 1991
appropriation. The additional funds will provide for: (1) the
Department's direct support of-the implementation of the Threshold Test
Ban Treaty and the Peaceful Nuclear Explosions Treaty; (2) expanded
activities in support of Intelligence Community requirements in the
areas of nuclear proliferation and U.S. energy security; and (3)
increased analysis of international terrorist activities that could
affect DOE interests.
Security Affairs
The Department's Safeguards and Security estimate for FY 1992 is
$1.1 billion, compared to $1 billion in FY 1991. This total
funding is identified in the Department's crosscut estimate, which
is a summation of Safeguards and Security items in all the
Department's program requests, including the Nuclear Safeguards
and Security budget at $96 million and the Security Investigations
budget at $62.6 million which I will address separately. The
Defense Programs' portion is $908 million in FY 1992, compared
to $846 million in FY 1991.
The Department is currently engaged in a massive effort to enhance
the safeguards and security posture at Rocky Flats. Physical
security upgrades and enhanced nuclear materials control measures
are being made to ensure a high confidence that nuclear materials
are satisfactorily protected. In addition, we are working to ensure
an enhanced security posture at Savannah River, when resumption of
operations begin at this facility.
We are making significant progress toward increasing the level of
protection of our facilities and the protection of DOE assets. Our
ability to mitigate the potential outsider threat remains at an
acceptable level at our nuclear weapons facilities. Current efforts are
focused in ensuring adequate protection against the potential insider
threat. We are making progress, but at a much slower pace than we would
like.
The budgets of Nuclear Safeguards and Security and Security
Investigations which I mentioned above, addresses such elements as
safeguards and security operations, technology development,
international safeguards, classification and technology policy, and
security investigations. Through these budgets, the Office of Security
procedures to prevent the theft of nuclear weapons or materials, the
Affairs carries out its responsibilities in policy, guidelines, and
sabotage of Departmental facilities, and the compromise of classified
information. The safeguards and security budget request supports
increased Headquarters assistance to field operations, while the
security investigations request will enable the Department to conduct
initial investigations for security clearances for new employees
while reducing the backlog of overdue reinvestigations for personnel
who currently possess a security clearance.
Last year, I directed that a thorough review be conducted of the
safeguards and security activities of the Department necessary to
assure the protection of nuclear weapons, materials, and facilities.
A task force of uniquely qualified individuals was formed to accomplish
this review. The task force issued its report on December 20, 1990. In
response to this assessment, I directed the reassignment of the
security affairs functions from the Office of the Assistant Secretary
directly to the Under Secretary of Energy, effective April 1, 1991.
for Defense Programs to a new Office of Security Affairs reporting
This was done in order to improve the Department's policy making
aspects of safeguards and security, which not only affects Defense
Programs, but many Departmental programs as well.
Many other initiatives related to actions recommended in this report
are underway. Such actions include an Accelerated Access Authorization
pilot project designed to significantly reduce processing times for "Q"
clearances for contractor employees (from 180 to 40-50 days). This
project is focused at Rocky Flats and is being conducted in cooperation
with our on-site contractors and early indications are that this
voluntary program is being well received by contractor employees. We
are also developing a new program designed to dramatically reduce the
number of "Q" clearances and increase the access afforded by "L"
clearances. This program is currently in the conceptual phase.
Consistent with report recommendations, our classified document
control initiatives include new accountability requirements for Secret
documents. This change will provide adequate and proper control of
classified material while reducing the administrative burden.
We have initiated several actions to review and streamline Master
Safeguards and Security Agreements (MSSA). For instance, we have
initiated a comprehensive review of the MSSA process, and have prepared
a draft MSSA Verification Guide and Team Handbook which will assist in
standardization of MSSA's across the complex.
The items which I have identified to you today are just a few of the
major undertakings which I have directed as a result of the findings in
the Task Force Report. I will continue to work with the Congress to
ensure that the protection of the Department's national security assets
continues as one of our highest priorities.
Security Evaluations
Also funded in the Atomic Energy Defense Activities appropriation is
the Office of Security Evaluations (OSE) which is responsible for the
independent oversight of the Department's safeguards and security
activities.
Since I was confirmed as Secretary of Energy I have focused on changing
the environment in DOE. A key element of the change is the
reorganization I outlined in my Notice SEN 6A. This reorganization
unequivocally placed the responsibility for executing and monitoring
required environmental, safety, health, and security actions within
the technical program offices as a line management function.
Additionally, my position is very clear that safety, health,
environment and security activities would not be subordinate to
production.
I have also moved OSE from the Assistant Secretary for Defense Programs
to the Assistant Secretary for Environment, Safety and Health. OSE
acts as the principal focal point for all safeguards and security
inspection and evaluation matters and serves as my independent
oversight assessing the posture of safeguards and security of the
Department of Energy. This function is carried out by conducting
assessments and special studies and performing other functions as
inspections at field sites and Headquarters, preparing topical
directed.
During FY 1992, OSE's budget request is for $15 million to continue
these oversight activities which will include eight comprehensive
inspections and ten short notice reviews.
Additional Management Improvements
I would also like to mention recent management improvements I have
undertaken to increase staffing, enhance worker health and safety,
improve contractor performance, and strengthen the management
capability within Defense Programs to address current priorities.
STAFFING
Departmental staffing has increased significantly above the FY 1990
Full Time Equivalent (FTE) usage, and staffing growth for the major
Department programs is almost 16 percent above FY 1990 levels. These
increases will provide FTEs to staff the critical, high priority
workloads in the Department in FY 1992. However, the Department is
continuing its comprehensive review of manpower resource requirements,
which was begun in FY 1990, to assure the most effective deployment of
containing much desired critical pay and dual compensation provisions
its limited staffing resources. Enactment last year of legislation
promises to us in staffing these positions with men and women who have
the skills necessary to perform the required functions. Further
legislative changes that would allow highly skilled National Laboratory
personnel to rotate into and out of Department service would provide a
significant additional source of scientific and technical excellence in
the management of the Department's nuclear complex.
Worker Health and Safety
In the area of worker health and safety, I requested a comprehensive
evaluation a year ago in view of the workplace safety deficiencies
found during DOE environment, safety and health "Tiger Team" compliance
appraisals at our facilities. The Department of Labor recently released
its report entitled, "Evaluation of the Department of Energy's (DOE's)
Safety and Health Programs for it's Government-Owned and
Contractor-Operated Facilities." The findings in this report were
significant and, in response, I directed that a series of actions take
place to build on our existing programs:
o The existing capability of DOE and contractor line programs
to administer and oversee workplace safety effectively will
be promptly surveyed; specific recommendations on staffing,
equipment and qualifications and training needs are to be
provided within 90 days.
o The role of self-assessment programs in DOE and contractor
line operating programs will be expanded to address
occupational safety and health.
o All cost-plus-award-fee determinations will address
occupational safety and health compliance as an explicit
performance element.
o Independent--oversight by the Assistant Secretary for
Environment, Safety and Health will be strengthened by
elevating its OSHA oversight role through the development
of revised mission and function statements, and the reallocation
of resources required to create a new Office of Occupational
Safety Programs. I expect this office to serve as a 'technical
catalyst' for fostering needed changes in the way the Department
approaches workplace safety and health technology and practice.
0 On a longer-term basis, I have issued tasking memoranda that
prescribe internal assessments to be performed over the next
few months to address all of the findings and recommendations
contained in the OSHA report.
0 Also, DOE Orders governing workplace safety and health will be
revised within six months to correspond more closely to OSHA
regulations and these will be used as the basis for
considering adoption of DOE occupational safety and health
requirements through rulemaking.
I believe these, as well as future steps for worker safety and health,
will help focus initiatives already mandated to make DOE line programs
fully accountable for operational programs and activities.
M&O Contractor Rule
Another recent initiative involves increasing the Department's efforts
to improve how we and our contractors are carrying out our fiscal
responsibilities. By the very nature of how DOE conducts its business,
the Department depends almost entirely on contractors to perform the
tasks assigned. While it is essential that DOE exercise proper
technical control over this effort, it is equally essential that DOE
exercise proper fiscal control. As custodians of the taxpayers money,
it is up to us to ensure that it is properly spent. I do not believe we
have done a good Job in this respect. As a result, I have directed that
certain actions be taken to improve the way DOE discharges its fiscal
responsibilities in the management of our contractors.
One such action is directed at increasing the accountability of our
M&O contractors and restructuring the award fee system to provide
incentives for improved performance. On January 25, 1991, 1 announced
an Interim final Rule to hold the Department's profit-making M&O
contractors, rather than the government, responsible for costs that
could have been avoided by proper contractor performance.
This new rule represents the most far-reaching changes in the
contracting practices of the Department since the Manhattan Project and
has been almost two years in the drafting. Historically, the
Department has reimbursed its contractors for almost every cost or
expense and indemnified them from virtually every risk, without regard
to the amount of care and responsibility exercised by the contractors.
accountability of DOE's contractors and will provide the Department
The Interim Final Rule is designed to enhance the performance and
with another management tool to promote excellence in performance by
its contractors. The new regulations, which will be effective for all
new or extended M&O contracts, will apply to contractors who manage and
operate DOE's facilities for profit. In their recent five year contract
extension, Martin Marietta Energy Systems has substantially agreed to
the provisions in the Interim Final Rule. We anticipate reaching
similar agreements with our other M&O contractors in the future.
Defense Programs Management Changes
I have also taken steps to strengthen the management, organization,
performance and oversight within the Office of Defense Programs for two
new activities critical to our success. Two new positions have been
created. The Deputy Assistant Secretary for Weapons Complex
Reconfiguration will be responsible for directing headquarters
guidance and oversight of all activities leading to a Secretarial
decision concerning the reconfiguration options; and subsequently
to all activities leading to full operation of a reconfigured
nuclear weapons complex. The Deputy Science and Technology Advisor
(Defense) will be responsible for providing advice and
recommendations to the Assistant Secretary for Defense Programs
and the Department's Science and Technology Advisor to optimize
the utilization, performance, and contribution of the three weapons
laboratories and the Idaho National Engineering Laboratory.
Summary
As the Committee proceeds with the difficult process of reaching final
decisions on our FY 1992 budget request, I want to reiterate the
dilemma I face regarding decisions for the Atomic Energy Defense
Activities programs. I believe the Department's FY 1992 budget,
including the FY 1991 Supplemental, is the bare minimum amount required
to support our national security programs in a safe and environmentally
sound manner. This budget was arrived at only after much soul searching
same time there is necessary growth in the Environmental Restoration
that included the deferral of many critical activities. However, at the
and Waste Management program. This growth was anticipated and is
vitally needed to support infrastructure expansion as we strive to meet
our statutorily dictated environmental requirements. In a sense, this
puts me between a rock and a hard place. In the outyears, there is a
cap on the 050 account which must be met; however, there is no doubt
that budgetary increases will be needed to meet the Department's
ways to assure all programs are operating efficiently, and I have
expanding production and environmental obligations. We are looking at
directed that the Department undertake a program to reduce costs by
improving our business management practices, but there are no easy
solutions.
However, two others factors exist which contribute to potential
future funding adjustments in environmental restoration and waste
management. The first factor involves the transfer of
responsibility for retired production facilities and other related
activities to the Office of Environmental Restoration and Waste
Management. We have the ability to plan for these anticipated
changes. However, the other factor involves the potential cost
increases to meet environmental compliance. This is of particular
concern to me since, as I already mentioned, there are a significant
number of uncertainties confronting the Department as it strives to
meet the requirements of applicable environmental statutes.
Budget realities dictated constraints such that I had to make severe
cuts in our weapons production complex, in our weapons research and
development program, and in our program to pursue new production
reactor capacity to replace our aging reactors. As I have already
stated, those cuts required me to provide for restart of only one
reactor at Savannah River, prematurely terminate the two reactor
Program, reduce critical laboratory personnel employment dedicated to
strategy before the Record of Decision on the New Production Reactor
maintaining nuclear weapons competence by about 6 percent, limit
significantly important underground nuclear testing to its lowest
levels since the testing moratorium in the 1960s, and continue to
defer necessary maintenance and facility upgrades throughout the
nuclear weapons complex.
I do not believe it prudent to continue to make these reductions in
critical activities that support our national security. The situation
for next year will not be better. I need your support so that I can
provide the Nation with the appropriate national security programs
this Department must statutorily provide. I would be pleased to
answer any questions you may have.
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