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GAO Investigates (and criticizes) the DOE's Cost Estimates For Future Budget Increases

A recent Government Accountability Office (GAO) report titled, Actions Needed to Identify Total Costs of Weapons Complex Infrastructure and Research and Production Capabilities found that The Department of Energy's (DOE) National Nuclear Security Administration (NNSA) lacks the information that would help justify its planned FY 2011 (and beyond) budget increase. The GAO further found that the NNSA itself does not know the actual total costs to maintain the facilities and can't provide accurate budget information to Congress.

NNSA has the primary mission of "maintaining an effective nuclear arsenal and providing the United States with safe, secure, and reliable nuclear weapons." In addition, the Administration has recently committed to reductions in the nuclear stockpile: "The size of this smaller stockpile is the outcome of recently completed negotiations between Russia and the United States on a New Strategic Arms Reduction Treaty, which was signed on April 8, 2010, and, if ratified, will commit the two countries to significant and verifiable arms reductions."

While this may seem as a valid reason to increase funding for NNSA's programs, Congress cannot authorize funding without a sound justification for funding these programs.

During its investigation, GAO found that NNSA cannot accurately identify the total costs to operate and maintain weapons' activities facilities because of differences in the sites' cost accounting practices. Each of the eight sites has their own practices on how to account for the activities necessary to operate and maintain the facilities, which precludes NNSA from being able to identify the total costs to maintain the nuclear weapons stockpile. Accurately identifying the total costs of the weapons facilities is essential to justify future budget requests and to show the effects of potential budget increases on NNSA's programs.

Despite their lack of information, NNSA has consistently asked Congress to authorize funding for its programs. A recent Defense Nuclear Facilities Safety Board report highlighted NNSA's failure to provide accurate budget information to Congress for one of its projects that required upgrading gloveboxes. Initially, NNSA provided an original estimate for this project to be $6.4 million (upgrading 80 gloveboxes at $80,000 each). This cost has now nearly doubled and has gone up to an astonishing $133.4 million (upgrading 157 gloveboxes at $850,000 each), with a strong possibility that the costs will continue to increase since there is no clear strategy yet for performing upgrades for some of these gloveboxes. Without any action taken by NNSA to identify the costs or to provide program strategy for basic work, NNSA can't justify to Congress the need for an increase in its budget. NNSA has to provide an accounting for its costs and identify the potential benefits of budget increases before Congress can authorize funding for its programs.

GAO Recommendations:

Based on their findings, the GAO recommended that NNSA should develop guidance for the consistent collection of information (from the eight sites) on the total costs to operate and maintain weapons activities facilities and infrastructure, and use this information for budget formulation and program planning. Providing complete and reliable information on the total costs to maintain the nuclear arsenal will only further NNSA's mission of ensuring a smaller, efficient, and secure nuclear stockpile.

We'll keep you posted as this develops.

Click here to read the GAO Report.