[Senate Hearing 109-]
[From the U.S. Government Publishing Office]



 
 ENERGY AND WATER, AND RELATED AGENCIES APPROPRIATIONS FOR FISCAL YEAR 
                                  2007

                              ----------                              


                        THURSDAY, APRIL 6, 2006

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.
    The subcommittee met at 2:07 p.m., in room SD-192, Dirksen 
Senate Office Building, Hon. Pete V. Domenici (chairman) 
presiding.
    Present: Senators Domenici and Allard.

                          DEPARTMENT OF ENERGY

                National Nuclear Security Administration

STATEMENT OF HON. LINTON F. BROOKS, UNDER SECRETARY FOR 
            NUCLEAR SECURITY, AND ADMINISTRATOR, 
            NATIONAL NUCLEAR SECURITY ADMINISTRATION
ACCOMPANIED BY:
        JERRY PAUL, PRINCIPAL DEPUTY ADMINISTRATOR, NUCLEAR 
            NONPROLIFERATION ACTIVITIES
        ADMIRAL KIRKLAND DONALD, DEPUTY ADMINISTRATOR FOR NAVAL 
            REACTORS
        THOMAS D'AGOSTINO, DEPUTY ADMINISTRATOR FOR DEFENSE PROGRAMS

                 STATEMENT OF SENATOR PETE V. DOMENICI

    Senator Domenici. The hearing will please come to order. 
Today the subcommittee is going to hear testimony on the fiscal 
year 2007 budget request for the National Nuclear Security 
Administration. I would like to thank Ambassador Brooks for 
joining us here today and providing his testimony. The 
Ambassador is joined by Jerry Paul, the Principal Deputy 
Administrator for Nuclear Nonproliferation Activities--is that 
correct?--and Tom D'Agostino, Deputy Administrator for Defense 
Programs; and Admiral Kirkland Donald, Deputy Administrator for 
Naval Reactors. I appreciate everyone's participation and thank 
you for coming.
    Ambassador Brooks will provide the testimony and his three 
deputies will be available to answer questions. I understand 
that is our format.
    The President's request for NNSA for 2007 is $9.3 billion, 
up $211 million from last year's enacted level. Weapons 
programs. The funding for the weapons programs is $6.4 billion, 
up about $38 million. In large measure, this budget supports 
the necessary investments in lab infrastructure. However, I am 
concerned with the declining trend in science-based stockpile 
stewardship activities, such as science, engineering, and 
inertial confinement fusion.
    I could not be more disappointed in what the Department has 
proposed for inertial confinement fusion budget. The Department 
continues to put all their resources behind the NIF project at 
the expense of all the other stockpile activities. Funding for 
NIF research is up over $50 million while the other high energy 
density research has been cut by $115 million. The NIF-at-all-
costs attitude is now undermining balancing the weapons 
stewardship research activities. Declining budgets for non-NIF-
related science has put weapons physics research on Z and Omega 
clearly at risk.
    Mr. Ambassador, I believe this strategy is not the right 
one and we are going to work hard to correct it here in the 
Senate energy and water bill and we hope the product that we 
finish with will meet your satisfaction. It will be different 
than that which you submitted to us.
    On Monday, Tom D'Agostino briefed me, and I thank him for 
that, on NNSA's plan to implement the nuclear complex of the 
future. The Department has developed a plan to consolidate 
operations in fewer locations, which should reduce security 
costs and reduce the overall number of facilities that NNSA 
must maintain out in the future, perhaps to 2030. In addition, 
it supports the Reliable Replacement Warhead program and begins 
to catch up on the dismantlement of weapons no longer in the 
stockpile. That is good.
    What I believe is missing from the plan is a decrease in 
the overall number of weapons systems in the NNSA that they are 
going to be expected to maintain. Under the plan the NNSA will 
continue to support the same eight systems plus the new RRW 
through 2030 if I understand it correctly. It seems to me that 
you have traded off facilities, science, and people in exchange 
for the same number of systems and responsibilities. I am not 
sure that I got that figured right, but it looks like it, and I 
am not sure that makes the best sense overall.
    Why does this plan not contemplate reduction in existing 
systems, perhaps the elimination of one of them? Many experts 
wonder why we continue to maintain the W80. Maybe it is time to 
revisit the need for the life extension of that weapon. We will 
see.
    Nuclear nonproliferation is the next issue, and the budget 
continues to receive strong support from the President. That is 
good news. Funding for the nuclear nonproliferation activities 
are up $111 million, for a total of $1.73 billion. Funding for 
MOX, the global threat reduction initiative, and the MPC&A all 
received increases. I think that is good news.
    One notable exception is the funding cut for the nuclear 
detection R&D program. This activity supports research that 
gives our national security teams the technical advantage over 
terrorist countries that attempt to conceal their nuclear 
programs. We will ask about that, why that should have been 
reduced or eliminated.
    In 1998 I worked very hard with a few others to provide 
$200 million to encourage the Russians to come to the 
negotiating table on plutonium disposition, 1998. The funding 
was in good faith and the offer to the Russians to demonstrate 
our sincerity and seriousness about nonproliferation. The 
Department of Energy and State, the Department of State, have 
secured $800 million from G-8 partners to construct the Russian 
MOX plant, a real achievement.
    However, I understand the Russians have raised the stakes 
and are now demanding that the G-7 pay for the plant 
operations. I think we are correct in that. You have to talk 
about that, Mr. Ambassador. It is a matter of high, high 
importance. Unless we allow them to use the plutonium for their 
fast breeder reactor program, they insist that we are going to 
have to pay for plant operations. Now, I am concerned that 
these fact reactors could be turned into breeder reactors and 
will create additional plutonium, the very substance we are 
trying to eliminate.
    We also continue to wait for the final approval of the 
Russians--that is, their full governmental, governance-making--
on the liability deal negotiated last July. I feel that the 
opponents of MOX will use these delays as an excuse to cut 
funding for this project. The Russian delaying tactics have 
created a liability for the U.S. program in my opinion.
    I believe we should de-link the construction projects and 
allow the U.S. efforts to go forward to create a disposal 
pathway for our weapons-grade plutonium. We must live up to our 
commitments of reducing our stockpile even if the Russians will 
not or if for some reason they think they must continue to 
delay this matter, as I have described it, or for other 
reasons.
    In the mean time, we should continue to talk and try to 
work things out with the Russians, try to get an agreement 
prior to or during the G-8 meeting. That is up to our two great 
countries and that will take place this summer. But until we 
have final agreement that will guarantee the destruction of the 
34 tons of Russian weapons-grade plutonium, the United States 
should not fund the Russian construction project and we must 
not provide any further design on the MOX plant for the 
Russians in my opinion.
    My last observation has to do, Mr. Ambassador, with the 
cost of operations of LANL. In 2 months, Los Alamos National 
Security LLC will take over the M&O contract at Los Alamos from 
the University of California, which has operated the facility 
for 60 years. I am concerned about the increased costs of the 
new contract negotiated by NNSA. I am not saying I am concerned 
in the sense that this should not have happened, but I am 
concerned that the new contract provides significant increases 
in the fee, from roughly $8 million to $80 million, and it will 
require the lab to pay the gross receipts tax to the State of 
New Mexico of about $75 million. I think that is the estimate.
    I suspect that there are operations--several other 
increases that add to the bottom line operations because of the 
new contract. I do not know that. Unfortunately, the Los Alamos 
lab budget does not reflect any increases to accommodate these 
added charges. All of these costs will come out of R&D, 
science, and operational accounts, putting further strain on an 
already tight budget.
    I hope to get some answers from you, Mr. Ambassador, as to 
how these costs will be offset without having a negative impact 
on lab operations. I know the answer is going to be there will 
be savings made here and there and elsewhere. That may be the 
case, but clearly that is not going to go on forever, and we 
are going to have some assurance that in the future we have got 
to make this up in ways other than to continue to assume it 
will come out of savings.
    I will close now by saying how I remain impressed with the 
success of the naval reactor program. I save it for last 
because it is best and because it does not take very long to 
explain it, to just say that the Navy needs nuclear propulsion 
plants that are capable of responding to the challenges that we 
face and we believe this program accomplishes these goals. The 
5-year plan includes a small but a steady increase in the naval 
reactors, which will prove beneficial in the coming months.
    Now, I will ask if there are any others who want to make 
opening remarks. If there are any opening remarks that are 
needed to be put in the record, we will provide for that now 
without objection.
    Now, having completed that, we will move to the witness. 
Mr. Ambassador, sorry I took so long, but I think you know how 
I feel on a few of these subjects now. So you may proceed as 
you see fit.

                   STATEMENT OF HON. LINTON F. BROOKS

    Ambassador Brooks. Thank you, sir. I have submitted a 
statement which I would like received for the record.
    The President's budget supports three main missions: safe, 
secure, and reliable stockpile; reducing the nonproliferation 
threat; and providing reliable and safe nuclear propulsion 
systems for the Navy. Most of our programs are similar to 
previous years, are familiar to the committee, and are 
described in my written statement, so I want to limit my 
opening remarks to drawing your attention to a couple of 
points.
    First, as you noted, sir, although the stockpile remains 
safe and reliable today, we must ensure reliability and safety 
over the long term and this means transforming the stockpile 
and the supporting infrastructure. Our approach to doing so 
depends heavily on the concept of a Reliable Replacement 
Warhead, taking advantage of our decision to relax cold war 
design constraints. We believe we will be able then to design 
replacement components that are easier to manufacture, safer, 
use environmentally more benign material, and increase 
performance margins.
    I share your concern about the number of weapons systems. 
The Department of Defense and we are working together closely. 
The question is not: ``Will we still be maintaining eight 
systems in 2030?'' The answer is almost certainly no. The 
question is: ``How far along do we have to go in this new 
effort before the military can have confidence that it can 
eliminate a weapons system?'' Our assumption for the long-term 
future demands, frankly, that there would be reductions in the 
life extension programs. Otherwise the resources for 
modernizing the complex are going to be very difficult to find.
    We have completed, as you know and as you have been 
briefed, an intensive effort to sustain and establish our 
vision for the future, and I am quite pleased with it. Our 
challenge has been to find a path that is both affordable and 
feasible, and lets us continue to support the near-term 
stockpile.
    I want to make two other points about the weapons program. 
Last year the Congress reduced life extension programs and 
those reductions challenge our ability to meet DOD 
requirements. I am especially concerned with the reduction to 
the W76 submarine-launched ballistic missile warhead and, 
assuming that it is retained, the W80 cruise missile warhead.
    Also last year, the Congress significantly reduced funds 
for the facilities and infrastructure recapitalization program. 
That has made it impossible to meet the congressionally-
mandated date of 2011 to terminate this program and the 
administration has submitted legislation to extend the effort 2 
years. I hope that the Congress this year will support the 
President's request in both those areas.
    Turning to nonproliferation, I would like to highlight 
three areas. First, we are on track to meet the various 
commitments agreed to between President Bush and President 
Putin at Bratislava in 2008. We will complete security upgrades 
in Russia by that date.
    Second, we are requesting a significant funding increase to 
permanently shut down the three remaining weapons-grade 
plutonium production reactors in Russia and we are also 
proposing a significant increase for the global threat 
reduction initiative, which secures both fissionable and 
radioactive material.
    Finally, as you noted, under the plutonium disposition 
program we expect to begin construction of the MOX fuel 
fabrication facility this fall, and approval of the entire 
administration request is in my judgment crucial because we 
will be seeking the peak funding construction year in 2007.
    I would also like to turn to two points that you made in 
your opening statement and respond briefly to them and then we 
can respond further in questions. With respect to 
nonproliferation research and development, our request this 
year is almost identical to our request last year. Last year 
the Congress increased funding. We did not take that as 
intended to be direction to alter our long-term base, and so it 
is not a question of cutting that program. It is a question of 
assuming that that was a one-time increase.
    Secondly, with regard to Los Alamos, I share your concern 
that we make sure that the American taxpayers and the program 
are not put at risk by the change we have made at Los Alamos. 
Over the next 7 years we could potentially spend almost half a 
billion dollars in fees at Los Alamos and I intend to get 
something for it.
    First, 70 percent of that fee will be performance-based and 
we will not spend it unless the performance warrants it. 
Performance very much includes efficiencies and improvements 
that will free up resources. As you know, when the lab director 
decided to shut the facility down, you can argue about the 
bookkeeping, but we probably spent several hundred million 
dollars. If we can guarantee that never happens again, we will 
in fact have more money to go into the program.
    I am also pleased that the new contractor has proposed a 
decreasing fee that starts at $70 million a year and drops in 
the seventh year to a maximum of $54 million. That is still a 
lot of money, but it is an indication that they believe that 
their task will be greatest in the early years.
    Finally, as you noted, the naval reactors effort, which has 
always been a model for performance efficiency, is the final 
segment of our budget. Our request supports our No. 1 priority 
of ensuring safety and reliability of 104 operating Navy 
nuclear propulsion plants and it also continues research on 
advanced technology.

                           PREPARED STATEMENT

    Mr. Chairman, our budget request continues to transform the 
stockpile, continues to transform the infrastructure, continues 
to reduce the global danger from proliferation, and continues 
to enhance Navy force projection capabilities, and I urge the 
committee to support it.
    With that, sir, I am ready for your questions.
    [The statement follows:]

              Prepared Statement of Hon. Linton F. Brooks

    Thank you for the opportunity to discuss the President's fiscal 
year 2007 Budget Request for the National Nuclear Security 
Administration (NNSA). This is my fourth appearance before this 
committee as the Under Secretary for Nuclear Security, and I want to 
thank all of the members for their strong support for our important 
national security responsibilities.

                                OVERVIEW

    In the sixth year of this administration, with the strong support 
of Congress, NNSA has achieved a level of stability that is required 
for accomplishing our long-term missions. Our fundamental 
responsibilities for the United States include three national security 
missions:
  --assure the safety and reliability of the U.S. nuclear weapons 
        stockpile while at the same time transforming that stockpile 
        and the infrastructure that supports it;
  --reduce the threat posed by nuclear proliferation; and
  --provide reliable and safe nuclear reactor propulsion systems for 
        the U.S. Navy.
    The budget request for $9.3 billion, an increase of $211 million, 
supports these NNSA missions.
Weapons Activities
    The NNSA is committed to ensuring the long-term reliability, safety 
and security of the Nation's nuclear deterrent. Stockpile Stewardship 
is working; the stockpile remains safe and reliable. This assessment is 
based not on nuclear tests, but on cutting-edge scientific and 
engineering experiments and analysis, including extensive laboratory 
and flight tests of warhead components and subsystems. Each year, we 
are gaining a more complete understanding of the complex physical 
processes underlying the performance of our aging nuclear stockpile. 
However, as we continue to draw down the stockpile to the levels 
established in the Treaty of Moscow--between 1,700 and 2,200 
operationally deployed strategic nuclear weapons--we must consider the 
long-term implications of successive warhead refurbishments for the 
weapons remaining in the stockpile. Successive refurbishments will take 
us further from the tested configurations and it is becoming more 
difficult and costly to certify warhead remanufacture despite the 
extraordinary success of the Stockpile Stewardship Program.
    If we were starting to build the stockpile from scratch today we 
would take a much different approach than we took during the Cold War. 
Most of today's warheads were designed to maximize explosive yield with 
minimum size and weight so that many warheads could be carried on a 
single delivery vehicle. As a result, weapons designers designed closer 
to the so-called ``cliffs'' in performance. If we were designing the 
stockpile today, we would manage risk differently, trading size and 
weight for increased performance margins and ease of manufacture and 
maintenance.
    Second, the legacy stockpile was not designed for longevity. During 
the Cold War we introduced new weapons routinely, turning over most of 
the stockpile every 15-20 years. Today, our weapons are aging and now 
are being rebuilt in life extension programs that are both difficult 
and costly. Rebuilding nuclear weapons will never be cheap, but Cold 
War decisions to use certain hazardous materials mean that, in today's 
health and safety culture, warheads are much more costly to 
remanufacture.
    Furthermore, we continue to evolve our deterrent posture from its 
Cold War origins to one that requires far fewer weapons. Decisions the 
President announced in 2004 will result, by 2012, in the smallest total 
stockpile since the Eisenhower Administration. Even with these 
unprecedented reductions, however, the stockpile--especially the 
components we keep in reserve--is probably too large.
    Finally, with regard to physical security, we must consider new 
technology to ensure these weapons can never be used by those who wish 
to harm us. During the Cold War the main security threat to our nuclear 
forces was from espionage. Today, that threat remains, but to it has 
been added a post-9/11 threat of well-armed and competent terrorist 
suicide teams seeking to gain access to a warhead or to special nuclear 
materials in order to cause a nuclear detonation in place. This change 
has dramatically increased security costs. If we were designing the 
stockpile today, we would apply new technologies and approaches to 
warhead design as a means to reduce physical security costs.
    Fortunately, we know how to address all of these problems.
    The administration's Nuclear Posture Review (NPR), completed in 
December 2001, called for a transition from a threat-based nuclear 
deterrent with large numbers of deployed and reserve weapons to a 
deterrent based on capabilities, with a smaller nuclear weapons 
stockpile and greater reliance on the capability and responsiveness of 
the Department of Defense (DOD) and NNSA infrastructure to respond to 
threats. Success in realizing this vision for transformation will 
enable us to achieve over the long term a smaller stockpile, one that 
is safer and more secure, one that offers a reduced likelihood that we 
will ever again need to conduct an underground nuclear test, and one 
that enables a much more responsive nuclear weapons infrastructure. 
Most importantly, this effort can go far to ensure a credible deterrent 
for the 21st century that will reduce the likelihood we will ever have 
to employ our nuclear capabilities in defense of the Nation--through 
demonstration of responsiveness in design and production, demonstration 
of confidence in our abilities, cleanup of portions of the Cold War 
legacy and demonstration of America's will to maintain nuclear 
preeminence. We have worked closely with the DOD to identify initial 
steps on the path to a responsive nuclear infrastructure.
    What do we mean by ``responsive nuclear weapons infrastructure?'' 
By ``responsive'' we refer to the resilience of the nuclear enterprise 
to unanticipated events or emerging threats, and the ability to 
anticipate innovations by an adversary and to counter them before our 
deterrent is degraded. Unanticipated events could include complete 
failure of a deployed warhead type or the need to respond to new and 
emerging geopolitical threats. The elements of a responsive 
infrastructure include the people, the science and technology base, and 
the facilities and equipment to support a right-sized nuclear weapons 
enterprise. But more than that, it involves a transformation in 
engineering and production practices that will enable us to respond 
rapidly and flexibly to emerging needs. Specifically, a responsive 
infrastructure must provide capabilities, on appropriate timescales and 
in support of DOD requirements, to:
  --Dismantle warheads;
  --Ensure warheads are available to augment the operationally deployed 
        force;
  --Identify, understand, and fix stockpile problems;
  --Design, develop, certify, and begin production of refurbished or 
        replacement warheads;
  --Maintain capability to design, develop, and begin production of new 
        or adapted warheads, if required;
  --Produce required quantities of warheads; and
  --Sustain underground nuclear test readiness.
    As we and the DOD take the first steps down this path, we clearly 
recognize that the ``enabler'' for transformation is our concept for 
the Reliable Replacement Warhead (RRW). The RRW would relax Cold War 
design constraints that maximized yield to weight ratios and thereby 
allow us to design replacement components that are easier to 
manufacture, are safer and more secure, eliminate environmentally 
dangerous materials, and increase design margins, thus ensuring long-
term confidence in reliability and a correspondingly reduced chance we 
will ever need to resort to nuclear testing.
    The combination of the RRW and a responsive infrastructure--each 
enabled by the other--may be genuinely transformational. The reduced 
stockpile the President approved in 2004 still retains a significant 
non-deployed nuclear stockpile as a hedge against technical problems or 
geopolitical changes. Once we demonstrate that we can produce warheads 
on a timescale in which geopolitical threats could emerge, we would no 
longer need to retain extra warheads to hedge against unexpected 
geopolitical changes.
    In addition to the mission of continuously maintaining the safety, 
security, reliability and operational readiness of the Nation's nuclear 
deterrent, establishing the capabilities to achieve and sustain this 
transformation is a central focus of our activities. Transformation 
will, of course, take time. We are starting now with improving business 
and operating practices, both in the Federal workforce and across the 
nuclear weapons complex, and through restoring and modernizing key 
production capabilities. Full infrastructure changes, however, will 
take a couple of decades. But I believe by 2030 we can achieve a 
responsive infrastructure that will provide capabilities, if required, 
to produce weapons with different or modified military capabilities. As 
important, through the RRW program we will revitalize our weapons 
design community to meet the challenge of being able to adapt an 
existing weapon within 18 months and design, develop, and begin 
production of a new design within 3-4 years of a decision to enter 
engineering development--goals that were established in 2004.
    As part of the transformation process we are also actively 
reviewing the recommendations of the Secretary of Energy Advisory Board 
Nuclear Weapons Complex Infrastructure Task Force to prepare a 
comprehensive plan for transforming the nuclear weapons complex. Many 
of the recommendations are consistent with initiatives that NNSA was 
already considering or is implementing (design of a Reliable 
Replacement Warhead, consolidation of Special Nuclear Materials, 
accelerating dismantlement of retired weapons, managing the evolving 
complex to enhance responsiveness and sustainability, and establishing 
an Office of Transformation). The analysis of this report and its 
recommendations is underway and should be completed and presented to 
the Congress by this spring.
    Transformation presents some significant near term challenges, one 
of which is pit production. The NNSA considers an appropriate pit 
production capacity to be essential to its long-term evolution to a 
more responsive nuclear weapons infrastructure. We are disappointed, 
therefore, that Congress declined to fund planning for a modern pit 
production facility in fiscal year 2006. As a result, we did not seek 
funding for this facility in fiscal year 2007; although we remain 
convinced that increased pit production capacity is essential to our 
long-term evolution to a more responsive nuclear weapons 
infrastructure. In coming months, we will work with Congress to 
identify an agreed approach to fund long-term pit production capacity. 
In the meantime, we plan to increase the Los Alamos National Laboratory 
pit manufacturing capacity to 30-40 pits per year by the end of fiscal 
year 2012 in order to support the Reliable Replacement Warhead. This 
production rate, however, will be insufficient to meet our assessed 
long-term pit production needs.
    Another challenge of transformation is maintaining the balance 
between Life Extension Programs (LEP) for the current stockpile and 
development of the RRW and new infrastructure. The warhead LEP is key 
to our meeting the Department of Defense's (DOD) mission needs today 
and during transformation. These programs deserve special attention and 
I am concerned that fiscal year 2006 Congressional reductions for two 
warhead LEPs have challenged our ability to meet our deterrence needs. 
A reduction in the W76 LEP request significantly increased the risk to 
achieving a first production unit by the end of fiscal year 2007. 
Reductions to the W80 LEP request have delayed deployment of first 
production units and delayed the introduction of important use control 
features to strengthen security. We hope that this committee renews its 
support for these critical LEPs.
    Another significant near term challenge is ensuring the security of 
our people, our nuclear weapons, our weapons-usable materials, our 
information, and our infrastructure from harm, theft or compromise. The 
job has become more difficult and costly as a result of two factors: 
the increased post-9/11 threat to nuclear warheads and associated 
fissile materials coupled with the primacy of ``denying access'' to 
these key assets--a much more rigorous security standard than 
``containment'' of the asset. We will meet the requirements of the 2003 
Design Basis Threat (DBT) by the end of this fiscal year. We expect to 
be compliant with the 2005 DBT revisions at the two most sensitive 
locations, the Secure Transportation Asset and the Pantex Weapons Plant 
by the end of fiscal year 2008 as required by Departmental policy.
    The world in 2030 will not be more predictable than it is today, 
but this vision of our future nuclear weapons posture is enabled by 
what we have learned from 10 years of experience with science-based 
Stockpile Stewardship, from planning for and carrying out life 
extension programs for our legacy stockpile, and from coming to grips 
with national security needs of the 21st century as laid out in the 
NPR. A world of a successful responsive infrastructure isn't the only 
plausible future of course. But it is one we should strive for. It 
offers the best hope of achieving the President's vision of the 
smallest stockpile consistent with our Nation's security. That's why we 
are embracing this vision of stockpile and infrastructure 
transformation. We should not underestimate the challenge of 
transforming the enterprise, but it is clearly the right path for us to 
take.

Defense Nuclear Nonproliferation
    Let me now turn to our nuclear nonproliferation and threat 
reduction programs. Acquisition of nuclear weapons, WMD capabilities, 
technologies, and expertise by rogue states or terrorists poses a grave 
threat to the United States and international security. The pursuit of 
nuclear weapons by terrorists and states of concern makes it clear that 
our threat detection programs are urgently required must be successful 
and must proceed on an accelerated basis. The NNSA budget request 
addresses this urgency and demonstrates the President's commitment to 
prevent, contain, and roll back the proliferation of nuclear weapons-
usable materials, technology, and expertise.
    Our programs are structured around a comprehensive and multi-
layered approach to threat reduction and nuclear nonproliferation. We 
work with more than 70 countries to secure dangerous nuclear and 
radioactive materials, halt the production of fissile material, detect 
the illegal trafficking or diversion of nuclear material, and 
ultimately dispose of surplus weapons-usable materials. We also work 
with multilateral institutions including the International Atomic 
Energy Agency and the Nuclear Suppliers Group to strengthen nuclear 
safeguards and improve the nuclear export control regulatory 
infrastructure in other countries. This multi-layered approach is 
intended to identify and address potential vulnerabilities within the 
international nonproliferation regime, reduce the incentive for 
terrorists and rogue states to obtain WMD, and limit terrorists' access 
to deadly weapons and materials.
    A significant amount of our work falls at the intersection of 
nonproliferation and peaceful use of nuclear materials. The United 
States is setting an example by making a firm commitment to reducing 
its nuclear arsenal and recycling substantial quantities of weapons-
usable highly enriched uranium for peaceful, civilian, energy-
generating purposes. In 1994, the United States declared 174 tons of 
highly enriched uranium (HEU) to be in excess of our national security 
needs. The great bulk of that material is now in the process of being 
down blended for use in civilian nuclear power reactors. Last year, we 
announced that 17.4 MT of this material will be down blended and set 
aside to establish a fuel bank in support of our efforts to develop an 
international reliable fuel supply mechanism, an issue I will return to 
later in my statement.
    In addition, in May of 2004, President Bush announced plans to 
reduce our Nation's nuclear weapons stockpile by nearly half, to its 
smallest size since the Eisenhower Administration. This decision 
enables us to begin to dispose of a significant amount of weapons-grade 
nuclear material. Last year, the administration committed to remove an 
additional 200 metric tons of HEU--enough material for approximately 
8,000 nuclear warheads--from any further use as fissile material in 
U.S. nuclear weapons This represents the largest amount of special 
nuclear material ever removed from the stockpile in the history of the 
U.S. nuclear weapons program. The bulk of this material will be 
retained for use in propulsion systems for our Nation's nuclear navy--a 
step that will allow us to postpone the need to construct a new uranium 
high-enrichment facility for at least 50 years. Twenty metric tons of 
this HEU will be down blended to LEU for use in civilian nuclear power 
reactors or research reactors.
    We are also working with the Russian Federation to eliminate 34 
metric tons of weapons-usable plutonium in each country that will be 
converted into MOX fuel and burned in nuclear power reactors. We 
believe we have now resolved the impasse over liability that has long 
delayed the plutonium disposition program and the construction of the 
MOX plant at our Savannah River site.
    Much of our work focuses on emerging issues such as detecting 
clandestine nuclear supply networks, monitoring efforts by more 
countries to acquire nuclear weapons, and preventing the spread of 
nuclear fuel cycle technology. We have taken a number of steps to shut 
down illicit supply networks and keep nuclear materials out of the 
hands of terrorists as reflected in U.S. leadership in support of the 
Proliferation Security Initiative, Security Council Resolution 1540, 
criminalizing proliferation, and in strengthening international export 
control regimes.
    We have worked to expand our programs designed to stop nuclear 
smuggling and nuclear terrorism by cooperatively developing and 
employing radiological and nuclear detection equipment at key border 
crossings, airports, and major seaports, or ``megaports,'' worldwide. 
NNSA also assists and trains customs officials at home and abroad to 
detect the illicit trafficking of nuclear and radiological materials, 
as well as dual-use commodities that might be useful in weapons of mass 
destruction programs. We are also expanding our efforts to secure and 
transform global inventories of weapons-usable materials. Our programs 
include the Global Threat Reduction Initiative to reduce and secure 
fissile and radioactive material worldwide; our International Material 
Protection and Cooperation program, also known as ``MPC&A'', which has 
accelerated efforts to improve the security of weapons usable material 
in Russia and elsewhere; and our efforts to complete the conversion of 
research reactors throughout the world to the use of low enriched 
uranium within the next decade. There are also two complementary 
programs that address the repatriation of fresh and spent HEU material 
from Russian-supplied research reactors and U.S.-origin material from 
research reactors around the world.
    Cooperation with Russia on nonproliferation is nothing new for the 
United States, but this cooperation has been heightened following the 
rise of global terrorism and the events of September 11, 2001. The 
Joint Statement on Nuclear Security Cooperation issued by Presidents 
Bush and Putin at their Bratislava meeting last year is but one example 
of the significant progress we have made over the last 5 years. This 
joint statement has helped expedite our cooperative work with Russia. 
For example, as a result of the Bush-Putin Bratislava joint statement, 
we were able to make the return of fresh and spent HEU fuel from U.S.- 
and Russian-design research reactors in third countries a top priority, 
as well as a plan for joint work to develop low-enriched uranium fuel 
for use in these reactors. As a result, we were able complete the 
conversion of a Russian-supplied research reactor located in the Czech 
Republic to low-enriched fuel and to airlift a significant amount of 
HEU from the Czech Technical University reactor located near Prague for 
safe and secure storage in Russia. We have also made significant 
progress on the other Bratislava joint statement items, and we expect 
this cooperation and success will continue.
    Beyond the threat of nuclear terrorism, illicit networks engaging 
in nuclear trade, and additional states seeking nuclear weapons 
capability, the nonproliferation community also faces another 
significant challenge--revitalizing nuclear energy throughout the globe 
in a manner that also advances our nonproliferation interests. We have 
the opportunity to reshape our collective approach to ensure that 
nonproliferation is the cornerstone of the next evolution of civilian 
nuclear power and fuel cycle technology. The challenge before us is to 
make sure we design--from the very beginning--technologies and 
political arrangements that limit the spread of sensitive fuel cycle 
capabilities and ensure that rogue states do not use a civilian nuclear 
power as cover for a covert nuclear weapons program.
    Last month, the administration announced the Global Nuclear Energy 
Partnership, or GNEP, as part of President Bush's Advanced Energy 
Initiative. GNEP is a comprehensive strategy to enable an expansion of 
nuclear power in the United States and around the world, to promote 
nuclear nonproliferation goals; and to help resolve nuclear waste 
disposal issues. Fundamental to GNEP is a new approach to fuel cycle 
technology. Under this proposed new approach, countries with secure, 
advanced nuclear fuel cycle capabilities would offer commercially 
competitive and reliable access to nuclear fuel services--fresh fuel 
and recovery of used fuel--to other countries in exchange for their 
commitment to forgo the development of enrichment and recycling 
technology.
    Over the next year, we will work with other elements of the 
Department to establish GNEP, paying special attention to developing 
advanced safeguards and developing the parameters for international 
cooperation. Since the signing of the Nuclear Non-Proliferation Treaty, 
the world has sought to prevent the proliferation of nuclear weapons 
while expanding the benefits of nuclear technology. I believe that GNEP 
takes us closer to that goal. By allowing us to move beyond abstract 
discussions to tangible actions that will benefit directly those who 
join us in this partnership. GNEP will offer us the opportunity to take 
the international lead in making nonproliferation an integral part of 
our global nuclear safety and security culture.

Naval Reactors
    Also contributing to the Department's national security mission is 
the Department's Naval Reactors Program, whose mission is to provide 
the U.S. Navy with safe, militarily effective nuclear propulsion plants 
and ensure their continued safe, reliable and long-lived operation. 
Nuclear propulsion enhances our warship capabilities by providing the 
ability to sprint where needed and arrive on station; ready to conduct 
sustained combat operations when America's interests are threatened. 
Nuclear propulsion plays a vital role in ensuring the Navy's forward 
presence and its ability to project power anywhere in the world.
    The Naval Reactors Program has a broad mandate, maintaining 
responsibility for nuclear propulsion from cradle to grave. Over 40 
percent of the Navy's major combatants are nuclear-powered, including 
aircraft carriers, attack submarines, and strategic submarines, which 
provide the Nation's most survivable deterrent.

               FISCAL YEAR 2007 BUDGET REQUEST BY PROGRAM

    The President's fiscal year 2007 budget request totals $9.3 
billion, an increase of $211 million or 2.3 percent. We are managing 
our program activities within a disciplined 5-year budget and planning 
envelope. We are doing it successfully enough to be able to address the 
administration's high priority initiatives to reduce global nuclear 
danger in Defense Nuclear Nonproliferation, and provide for needed 
funding increases in some of our programs within an overall modest 
growth rate.

Weapons Activities
    The fiscal year 2007 budget request for the programs funded within 
the Weapons Activities appropriation is $6.41 billion, less than a 1 
percent increase over fiscal year 2006. This request supports the 
requirements of the Stockpile Stewardship Program consistent with the 
administration's Nuclear Posture Review (NPR) and the revised stockpile 
plan submitted to the Congress in June 2004. Our request places a high 
priority on accomplishing the near-term workload and supporting 
technologies for the stockpile along with the long-term science and 
technology investments to ensure the design and production capability 
and capacity to support ongoing missions. This request also supports 
the facilities and infrastructure that must be responsive to new or 
emerging threats.
    Directed Stockpile Work (DSW) is an area of special emphasis this 
year with a fiscal year 2007 request of $1.41 billion, a 3 percent 
increase over fiscal year 2006. In fiscal year 2007, we will be 
accelerating efforts for dismantlement of retired warheads and 
consolidation of special nuclear materials across the nuclear weapons 
complex. Both of these efforts will contribute to increasing the 
overall security at NNSA sites. DSW also supports routine maintenance 
and repair of the stockpile; refurbishes warheads through the Life 
Extension Programs; and, maintains the capability to design, 
manufacture, and certify new warheads, for the foreseeable future. DSW 
also supports managing the strategy, driving the change, and performing 
the crosscutting initiatives required to achieve responsiveness 
objectives envisioned in the NPR. Our focus remains on the stockpile, 
to ensure that the nuclear warheads and bombs in the U.S. nuclear 
weapons stockpile are safe, secure, and reliable.
    Progress in other parts of the Stockpile Stewardship Program 
continues. The fiscal year 2007 request for the six Campaigns is $1.94 
billion, a 9 percent decrease from fiscal year 2006. The Campaigns 
focus on scientific and technical efforts and capabilities essential 
for assessment, certification, maintenance, and life extension of the 
stockpile and have allowed NNSA to move to ``science-based'' 
stewardship. These campaigns are evidence of NNSA excellence and 
innovation in science, engineering and computing that, though focused 
on the nuclear weapons mission, have much broader application.
    Specifically, $425 million for the Science and Engineering 
Campaigns provides the basic scientific understanding and the 
technologies required to support the workload and the completion of new 
scientific and experimental facilities. We will continue to maintain 
the ability to conduct underground nuclear tests at the Nevada Test 
Site if required, but let me be clear, nothing at this time indicates 
the need for resumption for underground testing for the foreseeable 
future.
    The Readiness Campaign, with a request of $206 million, develops 
and delivers design-to-manufacture capabilities to meet the evolving 
and urgent needs of the stockpile and supports the transformation of 
the nuclear weapons complex into an agile and more responsive 
enterprise.
    The request of $618 million for the Advanced Simulation and 
Computing Campaign supports the schedule to enhance the computational 
tools and technologies necessary to support the continued assessment 
and certification of the refurbished weapons, aging weapons components, 
and a Reliable Replacement Warhead program without underground nuclear 
tests. As we enhance these tools to link the historical test base of 
more than 1,000 nuclear tests to computer simulations, we can continue 
to assess whether the stockpile is safe, secure, reliable, and performs 
as required.
    The $451 million request for the Inertial Confinement Fusion 
Ignition and High Yield Campaign is focused on the execution of the 
first ignition experiment at the National Ignition Facility (NIF) in 
2010 and provides facilities and capabilities for high-energy-density 
physics experiments in support of the Stockpile Stewardship Program. To 
achieve the ignition milestone, $255 million will support construction 
of NIF and the NIF Demonstration Program and $168 million will support 
the National Ignition Campaign. The ability of NIF to assess the 
thermonuclear burn regime in nuclear weapons via ignition experiments 
is of particular importance. NIF will be the only facility capable of 
probing in the laboratory the extreme conditions of density and 
temperature found in exploding nuclear weapons.
    The Pit Manufacturing and Certification Campaign request of $238 
million continues work to manufacture and certify the W88 pit in 2007 
and to address issues associated with manufacturing future pit types 
including the Reliable Replacement Warhead and increasing pit 
production capacity at Los Alamos National Laboratory.

            Readiness in Technical Base and Facilities (RTBF) and 
                    Facilities and Infrastructure Recapitalization 
                    Program (FIRP)
    In fiscal year 2007 we are requesting $1.98 billion for the 
maintenance and operation of existing facilities, remediation and 
disposition of excess facilities, and construction of new facilities. 
This is of critical importance to enable NNSA to move toward a more 
supportable and responsive infrastructure.
    Of this amount, $1.69 billion is requested for Readiness in 
Technical Base and Facilities (RTBF), an increase of 3 percent from 
fiscal year 2006, with $1.4 billion in Operations and Maintenance and 
$281 million for RTBF Construction. RTBF operates and maintains current 
facilities, and ensure the long-term vitality of the NNSA complex 
through a multi-year program of infrastructure construction.
    This request also includes $291 million for the Facilities and 
Infrastructure Recapitalization Program (FIRP), a separate and distinct 
program that is complementary to the ongoing RTBF efforts. The FIRP 
mission is to restore, rebuild and revitalize the physical 
infrastructure of the nuclear weapons complex. FIRP works in 
partnership with RTBF to assure that facilities and infrastructure are 
restored to an appropriate condition to support the mission, and to 
institutionalize responsible and accountable facility management 
practices. FIRP activities include reducing deferred maintenance, 
recapitalizing the infrastructure, and reducing the maintenance base by 
eliminating excess real property. The FIRP Recapitalization projects 
are key to restoring the facilities that house the people, equipment, 
and material necessary to the Stockpile Stewardship Program, the 
primary NNSA mission. FIRP Facility Disposition activities reduce 
Environment, Safety and Health (ES&H) and safeguards and security 
liabilities, address footprint reduction of the complex, and reduce 
long-term costs and risks. The primary objective of FIRP Infrastructure 
Planning is to ensure that projects are adequately planned in advance 
of project start.
    Last year the Congress significantly reduced funds for the FIRP 
program. This reduction, coming on reductions in planned levels 
dictated by fiscal constraints, means that the original (and 
Congressionally mandated) goal of eliminating the maintenance backlog 
and terminating the FIRP program by 2011 is no longer attainable. This 
matter may require legislation extending the FIRP program to 2013. We 
remain committed to the concept of FIRP as a temporary, ``get well'' 
program and to the long term, sustained funding of maintenance within 
the RTBF program.

            Secure Transportation Asset
    In fiscal year 2007, the budget requests $209 million for Secure 
Transportation Asset (STA), a minor decrease from fiscal year 2006 
levels, for meeting the Department's transportation requirements for 
nuclear weapons, components, and special nuclear materials shipments. 
The workload requirements for this program will escalate significantly 
in the future to support the dismantlement and maintenance schedule for 
the nuclear weapons stockpile and the Secretarial initiative to 
consolidate the storage of nuclear material. The challenge to increase 
secure transport capacity is coupled with and impacted by increasingly 
complex national security concerns. To support the escalating workload 
while maintaining the safety and security of shipments, STA is 
increasing the cumulative number of Safeguard Transporters in operation 
by three per year, with a target total of 51 in fiscal year 2011.

            Environmental Projects and Operations
    We are requesting $17.2 million for Environmental Projects and 
Operations. The $17.2 million request is for a new function, Long Term 
Response Actions/Long-Term Stewardship, which covers continuing 
environmental stewardship at NNSA sites after the completion of 
Environmental Management activities. This new program at each site 
begins when EM cleanup activities are completed, and will continue for 
several years. Activities comprise routine inspections of landfill 
covers/caps, and maintenance of pump and treatment systems, and 
starting in fiscal year 2007, will be performed at three NNSA sites: 
Lawrence Livermore National Laboratory, Kansas City Plant, and Sandia 
national laboratories.
    The fiscal year 2007-2011 Budget Request does not include the 
transfer of legacy environmental management activities at NNSA sites 
that was proposed in the fiscal year 2006 Budget Request. However, the 
responsibility for newly generated waste at the Lawrence Livermore 
National Laboratory and the Y-12 National Security Complex was 
transferred to the NNSA in fiscal year 2006, and is managed in the 
Readiness in Technical Base and Facilities GPRA unit.

            Nuclear Weapons Incident Response
    The fiscal year 2007 request for Nuclear Weapons Incident Response 
is $135 million, an increase of 15 percent over fiscal year 2006. The 
NNSA Emergency Operations remains the U.S. Government's primary 
capability for radiological and nuclear emergency response in support 
of Homeland Security. The program is continuing efforts to enhance 
Emergency Response capabilities, and the budget request supports all 
assets as planned, with emphasis on recruitment and training of 
personnel called into action during emergency situations. The fiscal 
year 2007 increase is primarily associated with the research and 
development efforts of the Render Safe Research and Development 
program. This budget realigns this research and development funding to 
Emergency Response where the program is managed.

            Safeguards and Security
    The fiscal year 2007 request for Safeguards and Security is $754 
million. This budget supports two security-related activities. The 
budget request proposes that the physical security portion of NNSA's 
Safeguards and Security GPRA Unit be renamed ``Defense Nuclear 
Security'', consistent with the responsible NNSA organization. This 
program is responding to a revision in threat guidance affecting 
physical security at all NNSA sites. Meeting the Design Basis Threat 
will require further upgrades to equipment, personnel and facilities, 
and NNSA is committed to completing these activities. The Cyber 
Security program activities, managed by the NNSA Chief Information 
Officer, comprise the rest of this account, and the fiscal year 2007 
request is essentially level with the fiscal year 2006 funding level. 
The Request includes funding for the DOE Diskless Conversion 
initiative. Meeting the post-9/11 security requirements has required a 
significant long-term investment, reflecting DOE's continuing 
commitment to meet these requirements.

Defense Nuclear Nonproliferation
    The Defense Nuclear Nonproliferation program goal is to detect, 
prevent, and reverse the proliferation of Weapons of Mass Destruction 
(WMD) while mitigating nuclear risk worldwide. Our programs address the 
danger that hostile nations or terrorist groups may acquire weapons of 
mass destruction or weapons-usable material, dual-use production or 
technology, or WMD capabilities. Our primary focus in this regard is 
securing or disposing of vulnerable stockpiles of weapon-usable 
materials, technology, and expertise in Russia and other countries of 
concern. The administration's request of $1.73 billion to support NNSA 
activities to reduce the global weapons of mass destruction 
proliferation threat represents almost a 7 percent increase over the 
budget for comparable fiscal year 2006 activities.
    The administration's fiscal year 2007 Fissile Material Disposition 
budget request is $638 million, an increase of $169 million over fiscal 
year 2006. This increase reflects the progress in implementing the 
plutonium disposition program in the past year. Of this amount, $551 
million will be allocated toward disposing of surplus U.S. and Russian 
plutonium and $87 million will be allocated toward the disposition of 
surplus U.S. highly enriched uranium. The plutonium disposition 
program, the Department's largest nonproliferation program, plans to 
dispose of 68 metric tons (MT) of surplus Russian and U.S. weapons-
grade plutonium by fabricating it into mixed oxide (MOX) fuel for use 
in civilian nuclear power-generating reactors. The United States and 
Russia successfully completed negotiations of a liability protocol for 
the program, and senior Russian government officials have assured the 
United States that this protocol will be signed in the near future. DOE 
has also been working to validate the U.S. MOX project cost and 
schedule baseline as part of our project management process, and we 
will have a validated baseline in place before construction begins. DOE 
received authorization to begin construction of the MOX facility from 
the Nuclear Regulatory Commission, began site preparation work for the 
MOX facility at the Savannah River Site, and implemented a number of 
improvements to strengthen the management of the MOX project. Current 
plans call for construction of the U.S. MOX facility to start in 2006, 
with operations to start in 2015. The administration's budget request 
is essential for continuing this work in fiscal year 2007, which will 
be a peak construction year. Now that the liability issue is nearing 
resolution, high-level U.S.-Russian discussions are taking place to 
confirm the technical and financial details for the Russian 
construction program.
    The administration's fiscal year 2007 budget request of $107 
million for the Global Threat Reduction Initiative (GTRI) is a 10 
percent increase over fiscal year 2006 and supports the urgency carried 
in ambitious completion dates and objectives set by the program. GTRI 
represents the Department's latest effort to identify, secure, recover, 
and/or facilitate the disposition of the vulnerable nuclear and 
radioactive materials worldwide that pose a threat to the United States 
and the international community. Since the creation of GTRI, we have 
enjoyed a number of successes. Under our radiological threat reduction 
program, we have completed security upgrades at more than 340 
facilities around the world. As a result of the Bush-Putin Bratislava 
joint statement on enhanced nuclear security cooperation, we have 
established a prioritized schedule for the repatriation of U.S.-origin 
and Russian-origin research reactor nuclear fuel located in third 
countries. As part of our nuclear materials threat reduction efforts 
under GTRI, three successful shipments in fiscal year 2005 to 
repatriate Russian-origin fresh highly enriched uranium (HEU) from the 
Czech Republic (two shipments) and Latvia.
    In accordance with the President's Bratislava commitment, we have 
also begun working with the Russian Federation to repatriate Russian-
origin spent fuel. We have also conducted several successful shipments 
to repatriate U.S.-origin spent nuclear fuel from Japan, the 
Netherlands, Sweden, Greece, and Austria. We have converted three 
research reactors in the Netherlands, Libya, and the Czech Republic 
from the use of HEU to the use of low-enriched uranium (LEU) fuel so 
far in 2006, and we have completed physical security upgrades at three 
priority sites housing dangerous materials in Ukraine, Kazakhstan, and 
Uzbekistan.
    The International Material Protection and Cooperation fiscal year 
2007 budget request of $413 million is a 2 percent decrease from fiscal 
year 2006. For more than a decade, the United States has worked 
cooperatively with the Russian Federation and other former Soviet 
republics to secure nuclear weapons and weapons material that may be at 
risk of theft or diversion. As part of the Bush-Putin Bratislava joint 
statement, we agreed to accelerate security upgrades at Russian sites 
holding weapons-usable materials and warheads. The Bratislava joint 
statement also provided for a comprehensive joint action plan for 
cooperation on security upgrades of Russian nuclear facilities at 
Rosatom and Ministry of Defense sites. In addition, this statement 
called for enhanced cooperation in the areas of nuclear regulatory 
development, sustainability, secure transportation, MPC&A expertise 
training, and protective force equipment. A number of major milestones 
for this cooperative program are on the horizon, and the fiscal year 
2007 budget ensures that sufficient funding will be available to meet 
these milestones. Security upgrades for Russian Rosatom facilities will 
be completed by the end of 2008--2 years ahead of schedule. By the end 
of 2008 we will also complete cooperative upgrades at the nuclear 
warhead storage sites of the Russian Strategic Rocket Forces and the 
Russian Ministry of Defense sites. By the end of fiscal year 2007, we 
will have provided security upgrades at more than 80 percent of all the 
nuclear sites in Russia at which we now plan cooperative work.
    The administration's budget request will enable us to expand and 
accelerate the deployment of radiation detection systems at key transit 
points within Russia and accelerate installation of such equipment in 
five other priority countries to prevent attempts to smuggle nuclear or 
radiological materials across land borders. Through our Megaports 
initiative, we plan to deploy radiation detection capabilities at three 
additional major seaports in fiscal year 2007 to pre-screen cargo 
containers destined for the United States for nuclear and radiological 
materials, thereby increasing the number of completed ports to 13.
    The fiscal year 2007 budget request of $207 million for the 
Elimination of Weapons Grade Plutonium Production (EWGPP) is an 
increase of 18 percent from fiscal year 2006. The EWGPP program is 
working toward complete the permanent shut down of the three remaining 
weapons grade plutonium production reactors in Russia at Seversk and 
Zheleznogorsk. Every week, these reactors currently produce enough 
fissile material for several nuclear weapons. The overall EWGPP plan is 
to shutdown these reactors permanently and replace the heat and 
electricity these reactors supply to local communities with energy 
generated by fossil fuel plants by December 2008 in Seversk and 
December 2010 in Zheleznogorsk. The reactors will shut down immediately 
when the fossil plants are completed. The first validated estimate of 
total program cost--$1.2 billion--was determined in January 2004. After 
extensive negotiations with Russia, we achieved $200 million in cost 
savings. Also, under the authority to accept international funding as 
provided in the Ronald W. Reagan Defense Authorization Act for fiscal 
year 2005, we have received pledges of $30 million from six Global 
Partnership participants. Construction of the fossil fuel plant at 
Seversk started in late 2004, and the start of construction of the 
fossil fuel plant at Zheleznogorsk was recently approved. The increased 
funding as part of the fiscal year 2007 budget request allows for both 
construction projects to remain on schedule and thereby hold the line 
on cost.
    The fiscal year 2007 budget requests $269 million for 
Nonproliferation and Verification Research and Development. This effort 
includes a number of programs that make unique contributions to 
national security by researching the technological advancements 
necessary to detect and prevent the illicit diversion of nuclear 
materials. The Proliferation Detection program advances basic and 
applied technologies for the nonproliferation community with dual-use 
benefit to national counter-proliferation and counter-terrorism 
missions. Specifically, this program develops the tools, technologies, 
techniques, and expertise for the identification, location, and 
analysis of the facilities, materials, and processes of undeclared and 
proliferant WMD programs. The Proliferation Detection program conducts 
fundamental research in fields such as radiation detection, providing 
support to the Department of Homeland Security (DHS) and the 
Intelligence Community. The Nuclear Explosion Monitoring program builds 
the Nation's operational sensors that monitor from space the entire 
planet to detect and report surface, atmospheric, or space nuclear 
detonations. This program also produces and updates the regional 
geophysical data sets enabling operation of the Nation's ground-based 
seismic monitoring networks to detect and report underground 
detonations.
    The fiscal year 2007 budget request for Nonproliferation and 
International Security is $127 million. This figure cannot be directly 
compared to fiscal year 2006 because of a budget structure change that 
has realigned the Global Initiatives for Proliferation Prevention and 
HEU Transparency programs to this GPRA unit. Through this program the 
Department provides technical and policy expertise in support of U.S. 
efforts to strengthen international nonproliferation institutions and 
arrangements, fosters implementation of nonproliferation requirements 
through engagement with foreign partners, and helps develop the 
mechanisms necessary for transparent and verifiable nuclear reductions 
worldwide. This budget request addresses our need to tackle key policy 
challenges including efforts to strengthen the IAEA safeguards system, 
attempts to block and reverse proliferation in Iran and North Korea, 
attention to augmenting U.S. cooperation with China, India, and Russia, 
and our plan to build-up the nonproliferation component of the Global 
Nuclear Energy Partnership.

Naval Reactors
    The Naval Reactors fiscal year 2007 budget request of $795 million 
is an increase of $13.5 million from fiscal year 2006. The Program's 
development work ensures that nuclear propulsion technology provides 
options for maintaining and upgrading current capabilities, as well as 
for meeting future threats to U.S. security.
    The majority of funding supports the Program's No. 1 priority of 
ensuring the safety and reliability of the 104 operating naval nuclear 
propulsion plants. This work involves continual testing, analysis, and 
monitoring of plant and core performance, which becomes more critical 
as the reactor plants age. The nature of this business demands a 
careful, measured approach to developing and verifying nuclear 
technology; designing needed components, systems, and processes; and 
implementing them in existing and future plant designs. Most of this 
work is accomplished at Naval Reactors' DOE laboratories. These 
laboratories have made significant advancements in extending core 
lifetime, developing robust materials and components, and creating an 
array of predictive capabilities.
    Long-term Program goals have been to increase core energy, to 
achieve life-of-the-ship cores, and to eliminate the need to refuel 
nuclear powered ships. Efforts associated with this objective have 
resulted in planned core lives that are sufficient for the 30-plus year 
submarine (based on past usage rates) and an extended core life planned 
for CVN 21 (the next generation aircraft carrier). The need for nuclear 
propulsion will only increase over time as the uncertainty of 
conventional fuel cost and availability grows.
    Naval Reactors' Operations and Maintenance budget request is 
categorized into six areas: Reactor Technology and Analysis; Plant 
Technology; Materials Development and Verification; Evaluation and 
Servicing; Advanced Test Reactor (ATR) Operations and Test Support; and 
Facility Operations.
    The $212 million requested for Reactor Technology and Analysis will 
support continued work on the design for the new reactor plant for the 
next generation of aircraft carriers, CVN-21. These efforts also 
support the design of the Transformational Technology Core (TTC), a new 
high-energy core that is a direct outgrowth of the Program's advanced 
reactor technology and materials development and verification work.
    Reactor Technology and Analysis also develops and improves the 
analysis tools, which can be used to safely extend service life beyond 
our previous experience base. The increasing average age of our Navy's 
existing reactor plants, along with future extended service lives, a 
higher pace of operation and reduced maintenance periods, place a 
greater emphasis on our work in thermal-hydraulics, structural 
mechanics, fluid mechanics, and vibration analysis. These factors, 
along with longer-life cores, mean that for years to come, these 
reactors will be operating beyond our previously proven experience 
base.
    The $131 million requested for Plant Technology provides funding to 
develop, test, and analyze components and systems that transfer, 
convert, control, and measure reactor power in a ship's power plant. 
Reactor plant performance, reliability, and safety are maintained 
through a full understanding of component performance and system 
condition over the life of each ship. Naval Reactors is developing 
components to address known limitations and to improve reliability of 
instrumentation and power distribution equipment to replace aging, 
technologically obsolete equipment. Additional technology development 
in the areas of chemistry, energy conversion, instrumentation and 
control, plant arrangement, and component design will continue to 
support the Navy's operational requirements.
    The $118 million requested for Materials Development and 
Verification funds material analyses and testing to provide the high-
performance materials necessary to ensure that naval nuclear propulsion 
plants meet Navy goals for extended warship operation and greater power 
capability. More explicitly, materials in the reactor core and reactor 
plant must perform safely and reliably for the extended life of the 
ship.
    The $179 million requested for Evaluation and Servicing sustains 
the operation, maintenance, and servicing of Naval Reactors' operating 
prototype reactor plants. Reactor core and reactor plant materials, 
components, and systems in these plants provide important research and 
development data and experience under actual operating conditions. 
These data aid in predicting and subsequently preventing problems that 
could develop in Fleet reactors. With proper maintenance, upgrades, and 
servicing, the two prototype plants will continue to meet testing needs 
for at least the next decade.
    Evaluation and Servicing funds also support the implementation of a 
dry spent fuel storage production line that will put naval spent fuel 
currently stored in water pits at the Idaho Nuclear Technology and 
Engineering Center and at the Expended Core Facility (ECF) on the Naval 
Reactors facility in Idaho into dry storage. Additionally, these funds 
support ongoing decontamination and decommissioning of inactive nuclear 
facilities at all Naval Reactors sites to address their ``cradle to 
grave'' stewardship responsibility for these legacies, and minimize the 
potential for any environmental releases.
    The $64.6 million requested for Advanced Test Reactor Operations 
and Test Support sustains the ongoing activities of the INL ATR 
facility, owned and operated by the Office of Nuclear Energy (NE), 
Science, and Technology.
    In addition to the budget request for the important technical work 
discussed above, program direction and facilities funding is required 
for continued support of the Program's operations and infrastructure. 
The $57 million requested for facilities operations will maintain and 
modernize the Program's facilities, including the Bettis and Knolls 
laboratories as well as ECF and Kesselring Site Operations (KSO), 
through capital equipment purchases and general plant projects. The 
$2.8 million requested for construction funds will be used to complete 
construction of a materials development facility and to support the 
design of a materials research technology complex. Finally, the $31.2 
million requested for program direction will support Naval Reactors' 
DOE personnel at Headquarters and the Program's field offices, 
including salaries, benefits, travel, and other expenses.

Office of the Administrator
    The fiscal year 2007 budget request of $387 million, and increase 
of 14.2 percent over the fiscal year 2006 appropriation. NNSA completed 
the reengineering of its Federal workforce last year and has begun to 
recruit to fill critical skill gaps in safety, security, facilities, 
and business positions, in addition to the Future Leaders Intern 
program initiated in fiscal year 2005. The fiscal year 2007 request 
increases to provide additional personnel and support for mission 
growth in the Defense Nuclear Nonproliferation area, as well as in 
safety and security functions. The remainder of the increase reflects 
functional transfers to NNSA of 18 people from other Departmental 
elements, and fact of life changes including pay adjustments, increased 
space and occupancy charges, and cost of living increases in pay and 
benefits. We plan to support a slightly higher workforce level than in 
previous years, reflecting support for mission growth areas and skill 
gap closures.

            Historically Black Colleges and Universities Support
    A research and education partnership program with the Historically 
Black Colleges and Universities (HBCU) and the Massie Chairs of 
Excellence was initiated by the Congress in the Office of the 
Administrator appropriation in fiscal year 2005 and fiscal year 2006. 
NNSA has established an effective program to target national security 
research opportunities for these institutions to increase their 
participation in national security-related research and to train and 
recruit HBCU graduates for employment within NNSA. The NNSA's goal is a 
stable $10 million effort annually. The majority of the efforts 
directly support program activities, and it is expected that programs 
funded by the Weapons Activities, Defense Nuclear Nonproliferation and 
Naval Reactors appropriations will fund research with the HBCUs in 
areas including engineering, radiochemistry, material and computational 
sciences and sensor development. A targeted effort in education and 
curriculum development, and support for the Massie Chairs, will also be 
continued.

                           MANAGEMENT ISSUES

    NNSA has fully embraced the President's Management Agenda through 
the completion of the NNSA re-engineering initiative by creating a more 
robust and effective NNSA organization. Additionally, NNSA's success 
has been recognized with consistently ``Green'' ratings from the DOE, 
including Budget and Performance Integration. NNSA's Planning, 
Programming, Budgeting and Evaluation (PPBE) process was implemented 
simultaneously with the standup of the new NNSA organization, and is 
now the established management construct that integrates management, 
financial data and performance information in a multi-year context.
    The PPBE process is in its fifth year of implementation, and 
provides a fully integrated, multi-year perspective. The linkages 
within NNSA mirror the Headquarters and field organization structures, 
and are supported by management processes, contracting, funds control 
and accounting documentation. The cascade and linkages are quite 
evident in our updated NNSA Strategic Plan, issued last November.
    We take very seriously the responsibility to manage the resources 
of the American people effectively and I am glad that our management 
efforts are achieving such results.
    Finally, to provide more effective supervision of high-hazard 
nuclear operations, I have established a Chief, Defense Nuclear Safety 
position and appointed an experienced safety professional to the 
position. I believe this will help us balance the need for consistent 
standards with my stress on the authority and responsibility of the 
local Site Managers.

                               CONCLUSION

    In conclusion, I am confident that we are headed in the right 
direction. Our budget request will support continuing our progress in 
protecting and certifying our nuclear deterrent, transforming our 
stockpile and infrastructure, reducing the global danger from 
proliferation and weapons of mass destruction, and enhancing the force 
projection capabilities of the U.S. nuclear Navy. It will enable us to 
continue to maintain the safety and security of our people, 
information, materials, and infrastructure. Above all, it will meet the 
national security needs of the United States of in the 21st century.
    Mr. Chairman, this concludes my statement. A statistical appendix 
follows that contains the budget figures supporting our request. My 
colleagues and I would be pleased to answer any questions on the 
justification for the requested budget.

  NATIONAL NUCLEAR SECURITY ADMINISTRATION: APPROPRIATION AND PROGRAM 
         SUMMARY TABLES, OUT-YEAR APPROPRIATION SUMMARY TABLES
                     FISCAL YEAR 2007 BUDGET TABLES

                   NATIONAL NUCLEAR SECURITY ADMINISTRATION APPROPRIATION AND PROGRAM SUMMARY
                                            [In millions of dollars]
----------------------------------------------------------------------------------------------------------------
                                          Fiscal Year    Fiscal Year    Fiscal Year   Fiscal Year
                                         2005 Current   2006 Original      2006       2006 Current   Fiscal Year
                                        Appropriations  Appropriation   Adjustments  Appropriation  2007 Request
----------------------------------------------------------------------------------------------------------------
National Nuclear Security
 Administration (NNSA):
    Office of the Administrator.......          363.4           341.9          -3.4          338.5         386.6
    Weapons Activities (after S&S WFO         6,625.5         6,433.9         -64.3        6,369.6       6,407.9
     offset)..........................
    Defense Nuclear Nonproliferation..        1,508.0         1,631.2         -16.3        1,614.8       1,726.2
    Naval Reactors....................          801.4           789.5          -7.9          781.6         795.1
                                       -------------------------------------------------------------------------
      Total, NNSA.....................        9,298.3         9,196.5         -92.0        9,104.5       9,315.8
----------------------------------------------------------------------------------------------------------------
Note.--The fiscal year 2006 column includes an across-the-board rescission of 1 percent in accordance with the
  Department of Defense Appropriations Act, 2006, Public Law 109-148.

    The NNSA budget justification contains information for 5 years as 
required by Sec. 3253 of Public Law 106-065. This section, entitled 
Future-Years Nuclear Security Program (FYNSP), requires the 
Administrator to submit to Congress each year the estimated 
expenditures necessary to support the programs, projects and activities 
of the NNSA for a 5-year fiscal period, in a level of detail comparable 
to that contained in the budget.

                OUT-YEAR APPROPRIATION SUMMARY NNSA FUTURE-YEARS NUCLEAR SECURITY PROGRAM (FYNSP)
                                            [In millions of dollars]
----------------------------------------------------------------------------------------------------------------
                                                        Fiscal      Fiscal      Fiscal      Fiscal      Fiscal
                                                       Year 2007   Year 2008   Year 2009   Year 2010   Year 2011
----------------------------------------------------------------------------------------------------------------
NNSA:
    Office of the Administrator.....................         387         394         402         410         418
    Weapons Activities (after S&S offset)...........       6,408       6,536       6,667       6,800       6,936
    Defense Nuclear Nonproliferation................       1,726       1,761       1,796       1,832       1,869
    Naval Reactors..................................         795         811         827         844         861
                                                     -----------------------------------------------------------
      Total, NNSA...................................       9,316       9,502       9,692       9,886      10,084
----------------------------------------------------------------------------------------------------------------


                                WEAPONS ACTIVITIES FUNDING PROFILE BY SUBPROGRAM
                                            [In thousands of dollars]
----------------------------------------------------------------------------------------------------------------
                                          Fiscal Year    Fiscal Year    Fiscal Year   Fiscal Year
                                          2005 Current  2006 Original      2006       2006 Current   Fiscal Year
                                         Appropriation  Appropriation   Adjustments  Appropriation  2007 Request
----------------------------------------------------------------------------------------------------------------
Weapons Activities:
    Directed Stockpile Work............      1,351,206      1,386,189       -13,862      1,372,327     1,410,268
    Science Campaign...................        277,253        279,464        -2,794        276,670       263,762
    Engineering Campaign...............        258,767        250,411        -2,504        247,907       160,919
    Inertial Confinement Fusion                536,756        549,073        -5,491        543,582       451,191
     Ignition and High Yield Campaign..
    Advanced Simulation and Computing          698,196        605,830        -6,058        599,772       617,955
     Campaign..........................
    Pit Manufacturing and Certification        263,570        241,074        -2,411        238,663       237,598
     Campaign..........................
    Readiness Campaign.................        265,472        218,755        -2,188        216,567       205,965
    Readiness in Technical Base and          1,657,712      1,647,885        -3,130      1,644,755     1,685,772
     Facilities........................
    Secure Transportation Asset........        199,709        212,100        -2,121        209,979       209,264
    Nuclear Weapons Incident Response..         98,427        118,796        -1,188        117,608       135,354
    Facilities and Infrastructure              313,722        150,873        -1,508        149,365       291,218
     Recapitalization Program..........
    Environmental Projects and           .............  .............  ............  .............        17,211
     Operations........................
    Safeguards and Security............        751,929        805,486        -7,735        797,751       754,412
                                        ------------------------------------------------------------------------
      Subtotal, Weapons Activities.....      6,672,719      6,465,936       -50,990      6,414,946     6,440,889
Use of Prior Year Balances.............        -16,372  .............       -13,349        -13,349  ............
Security Charge for Reimbursable Work..        -30,000        -32,000  ............        -32,000       -33,000
Transfer to the Office of the                   -3,205  .............  ............  .............  ............
 Administrator for Pajarito............
Undistributed Budget Authority \1\.....          2,400  .............  ............  .............  ............
                                        ------------------------------------------------------------------------
      Total, Weapons Activities........      6,625,542      6,433,936       -64,339      6,369,597     6,407,889
----------------------------------------------------------------------------------------------------------------
\1\ Results from application of the 0.8 percent across-the-board rescission against the gross Weapons Activities
  appropriation prior to receipt of the $300,000,000 which was derived by transfer from the Department of
  Defense in accordance with Public Law 108-447.

Note.--The fiscal year 2006 adjustments column includes an across-the-board rescission of 1 percent in
  accordance with the Department of Defense Appropriations Act, 2006, Public Law 109-148. It also reflects the
  approval of the following reprogrammings for Readiness in Technical Base and Facilities using prior year
  funding--Savannah River General Plant Projects and Project 03-D-102, National Security Sciences Building.
Public Law Authorization.--Public Law 109-163, National Defense Authorization Act, fiscal year 2006; Public Law
  109-103, Energy and Water Development Appropriations Act, 2006.


                                     OUT-YEAR FUNDING PROFILE BY SUBPROGRAM
                                            [In thousands of dollars]
----------------------------------------------------------------------------------------------------------------
                                                    Fiscal Year     Fiscal Year     Fiscal Year     Fiscal Year
                                                       2008            2009            2010            2011
----------------------------------------------------------------------------------------------------------------
Weapons Activities:
    Directed Stockpile Work.....................       1,381,893       1,431,364       1,462,287       1,494,962
    Science Campaign............................         282,223         281,344         274,296         268,441
    Engineering Campaign........................         169,012         152,114         149,639         147,584
    Inertial Confinement Fusion Ignition and             426,035         415,222         414,823         400,013
     High Yield Campaign........................
    Advanced Simulation and Computing  Campaign.         632,095         621,943         607,746         593,761
    Pit Manufacturing and Certification                  249,588         252,174         260,096         255,832
     Campaign...................................
    Readiness Campaign..........................         202,636         198,090         192,401         187,659
    Readiness in Technical Base and Facilities..       1,767,586       1,833,813       1,907,510       2,008,941
    Secure Transportation Asset.................         225,057         237,344         244,212         247,580
    Nuclear Weapons Incident Response...........         137,766         140,019         142,332         144,701
    Facilities and Infrastructure                        310,369         339,257         368,054         396,996
     Recapitalization Program...................
    Environmental Projects and Operations.......          17,518          17,805          18,099          18,400
    Safeguards and Security.....................         768,269         781,279         794,608         808,235
                                                 ---------------------------------------------------------------
      Subtotal, Weapons Activities..............       6,570,047       6,701,768       6,836,103       6,973,105
Security Charge for Reimbursable Work...........         -34,000         -35,000         -36,000         -37,000
                                                 ---------------------------------------------------------------
      Total, Weapons Activities.................       6,536,047       6,666,768       6,800,103       6,936,105
----------------------------------------------------------------------------------------------------------------


                                          MAJOR OUT-YEAR CONSIDERATIONS
                                            [In thousands of dollars]
----------------------------------------------------------------------------------------------------------------
                                                    Fiscal Year     Fiscal Year     Fiscal Year     Fiscal Year
                                                       2008            2009            2010            2011
----------------------------------------------------------------------------------------------------------------
Weapons Activities..............................       6,570,047       6,701,768       6,836,103       6,973,105
----------------------------------------------------------------------------------------------------------------


                         DEFENSE NUCLEAR NONPROLIFERATION FUNDING PROFILE BY SUBPROGRAM
                                            [In thousands of dollars]
----------------------------------------------------------------------------------------------------------------
                                   Fiscal Year     Fiscal Year     Fiscal Year      Fiscal Year
                                  2005 Current    2006 Original        2006        2006 Current     Fiscal Year
                                  Appropriation   Appropriation  Adjustments \1\   Appropriation   2007 Request
----------------------------------------------------------------------------------------------------------------
Defense Nuclear
 Nonproliferation and
 Verification:
    Nonproliferation Research           219,836         322,000           -3,220         318,780         268,887
     and Development...........
    Nonproliferation and                143,764          75,000             -750          74,250         127,411
     International Security....
    International Nuclear               403,451         427,000           -4,270         422,730         413,182
     Materials Protection and
     Cooperation...............
    Global Initiatives for               40,675          40,000             -400          39,600  ..............
     Proliferation Prevention..
    HEU Transparency                     20,784          19,483             -195          19,288  ..............
     Implementation \1\........
    Elimination of Weapons-              67,331         176,185           -1,762         174,423         206,654
     Grade Plutonium Production
    Fissile Materials                   619,060         473,508           -4,735         468,773         637,956
     Disposition...............
    Offsite Recovery Project...           7,540  ..............  ...............  ..............  ..............
    Global Threat Reduction      ..............          97,975             -980          96,995         106,818
     Initiative................
                                --------------------------------------------------------------------------------
      Subtotal, Defense Nuclear       1,522,441       1,631,151          -16,312       1,614,839       1,760,908
       Nonproliferation........
Use of Prior Year Balances.....         -14,475  ..............  ...............  ..............         -34,695
                                --------------------------------------------------------------------------------
      Total, Defense Nuclear          1,507,966       1,631,151          -16,312       1,614,839       1,726,213
       Nonproliferation........
----------------------------------------------------------------------------------------------------------------
\1\ This budget request includes an across-the-board rescission of 1 percent for fiscal year 2006 in accordance
  with the Department of Defense Appropriations Act 2006, Public Law 109-148.

Note.--The fiscal year 2006 column includes an across-the-board rescission of 1 percent in accordance with the
  Department of Defense Appropriations Act, 2006, Public Law 109-148.
Public Law Authorization.--Public Law 108-148, The Consolidated Appropriations Act, 2006.


                                     OUT-YEAR FUNDING PROFILE BY SUBPROGRAM
                                            [In thousands of dollars]
----------------------------------------------------------------------------------------------------------------
                                                    Fiscal Year     Fiscal Year     Fiscal Year     Fiscal Year
                                                       2008            2009            2010            2011
----------------------------------------------------------------------------------------------------------------
Defense Nuclear Nonproliferation:
    Nonproliferation and Verification Research           279,439         293,924         311,551         324,034
     and Development............................
    Nonproliferation and International Security.         132,458         134,706         138,835         146,990
    International Nuclear Materials Protection           403,351         444,405         530,723         542,859
     and Cooperation............................
    Elimination of Weapons Grade Plutonium               182,017         139,363          24,949  ..............
     Production.................................
    Fissile Materials Disposition...............         642,853         654,469         710,178         737,976
    Global Threat Reduction Initiative..........         120,619         129,085         115,635         116,649
                                                 ---------------------------------------------------------------
      Total, Defense Nuclear Nonproliferation...       1,760,737       1,795,952       1,831,871       1,868,508
----------------------------------------------------------------------------------------------------------------


                                          MAJOR OUT-YEAR CONSIDERATIONS
                                            [In thousands of dollars]
----------------------------------------------------------------------------------------------------------------
                                                    Fiscal Year     Fiscal Year     Fiscal Year     Fiscal Year
                                                       2008            2009            2010            2011
----------------------------------------------------------------------------------------------------------------
Defense Nuclear Nonproliferation................       1,760,737       1,795,952       1,831,871       1,868,508
----------------------------------------------------------------------------------------------------------------

    NNSA describes major out-year considerations at each GPRA-Unit 
level within this appropriation.

                                  NAVAL REACTORS FUNDING PROFILE BY SUBPROGRAM
                                            [In thousands of dollars]
----------------------------------------------------------------------------------------------------------------
                                    Fiscal Year     Fiscal Year     Fiscal Year     Fiscal Year
                                   2005 Current    2006 Original       2006        2006 Current     Fiscal Year
                                   Appropriation   Appropriation    Adjustments    Appropriation   2007 Request
----------------------------------------------------------------------------------------------------------------
Naval Reactors Development
 (NRD):
    Operations and Main-                 765,041         728,800          -7,288         721,512         761,176
     tenance....................
    Program Direction...........          29,264          30,300            -303          29,997          31,185
    Construction \1\............           7,132          30,400            -304          30,096           2,772
                                 -------------------------------------------------------------------------------
      Subtotal, Naval Reactors           801,437         789,500          -7,895         781,605         795,133
       Development..............
Use of Prior Year Balances......  ..............  ..............  ..............  ..............  ..............
                                 -------------------------------------------------------------------------------
      Total, Naval Reactors.....         801,437         789,500          -7,895         781,605         795,133
----------------------------------------------------------------------------------------------------------------
\1\ In the Conference report to Public Law 109-103, Congress directed that NR transfer $13.5 million to DOE-NE
  to support the Advanced Test Reactor (ATR) Life Extension Program (LEP). However, the report included the
  $13.5 million specified for ATR under the Construction Heading Vice Operations and Maintenance. The additional
  $13.5 million has been transferred to NE to support the LEP (NR total transfer to NE for ATR in fiscal year
  2006 was $70.8 million). Actual NR Construction requirements in fiscal year 2006 are $16.9 million.

Note.--The fiscal year 2006 column includes an across-the-board rescission of 1 percent in accordance with the
  Department of Defense Appropriations Act, 2006, Public Law 109-148.
Public Law Authorization.--Public Law 83-703, ``Atomic Energy Act of 1954''; Executive Order 12344 (42 U.S.C.
  7158), ``Naval Nuclear Propulsion Program''; Public Law 107-107, ``National Defense Authorization Act of
  2002'', Title 32, ``National Nuclear Security Administration''; Public Law 108-375, National Defense
  Authorization Act, Fiscal Year 2005; Public Law 108-447, The Consolidated Appropriations Act, 2005; Public Law
  109-163, National Defense Authorization Act, 2006.


                                            OUT-YEAR FUNDING SCHEDULE
                                            [In thousands of dollars]
----------------------------------------------------------------------------------------------------------------
                                                    Fiscal Year     Fiscal Year     Fiscal Year     Fiscal Year
                                                       2008            2009            2010            2011
----------------------------------------------------------------------------------------------------------------
Naval Reactors..................................         811,036         827,257         843,802         860,678
----------------------------------------------------------------------------------------------------------------


                                          MAJOR OUT-YEAR CONSIDERATIONS
                                            [In thousands of dollars]
----------------------------------------------------------------------------------------------------------------
                                                    Fiscal Year     Fiscal Year     Fiscal Year     Fiscal Year
                                                       2008            2009            2010            2011
----------------------------------------------------------------------------------------------------------------
Naval Reactors:
    Operations and Maintenance..................         765,186         777,407         780,702         804,078
    Program Direction...........................          32,700          33,900          35,100          35,900
    Construction................................          13,150          15,950          28,000          20,700
                                                 ---------------------------------------------------------------
      Total, Naval Reactors.....................         811,036         827,257         843,802         860,678
----------------------------------------------------------------------------------------------------------------

    NNSA describes major out-year considerations at each GPRA-Unit 
level within this appropriation.

                         PLUTONIUM DISPOSITION

    Senator Domenici. Thank you very much.
    Could we talk first about MOX?
    Ambassador Brooks. Yes, sir.
    Senator Domenici. First, I am surprised by the lack of 
detail in your statement regarding MOX. Your statement makes no 
mention of the fact that the Department is rebaselining the 
entire program and that cost estimates have increased to over 
$3 billion. It makes no mention of the steps the Department is 
taking to respond to the DOE IG report, which found that we 
lack sufficient contractor oversight, which has contributed to 
the increased costs.
    It also fails to mention that the Russians have made it 
clear that they will no longer pay for the operations of MOX if 
they are limited to using the fuel in light water reactors, in 
the same manner as the United States. Apparently the Russians 
have made a unilateral decision that their only interest is in 
fast reactors.
    Finally, I am becoming increasingly frustrated that the 
Russians continue to stall the final approval of the liability 
agreement. I believe the Russians are now the biggest liability 
facing the program and we should sever the link between the 
construction projects.
    So I have questions since your statement fails to mention 
any of these issues. Could you update the committee on them and 
what are you doing to improve the contract oversight and to 
rein in the contractor?
    Ambassador Brooks. Certainly, sir. Let me start with the 
Russian program first. Every Russian official at every level 
continues to assure us that the holdup in giving final approval 
to the liability agreement is entirely procedural. I share your 
frustration. I will note, however, that the Russian bureaucracy 
is legendary for taking a long time to do even simple things. 
So the information we have as recently as 2 weeks ago is an 
assurance from very senior Russians that there is no issue.
    Second, the Russians have made it clear that they will 
dispose of plutonium in light water reactors as we had 
envisioned if the entire cost is borne by the international 
community. The Russians have interpreted the 2000 agreement as 
suggesting that. I believe the United States does not interpret 
it that way. In any event, the State Department and the 
Russians and I believe that we are unlikely to raise all of the 
operating money from the international community. Therefore, to 
preserve our options to go in both directions we are working 
with the Russians on disposing of some fuel in an existing fast 
reactor called the BN-600.
    The BN-600 was envisioned in 2000 as one method for 
disposition and it is not a new idea. It is new that it is seen 
as the primary approach. Part of this effort would be to remove 
the blanket that makes it a breeder and to do that in a way 
that is verifiable to the United States.
    I share your view that it would be lunacy to use surplus 
plutonium in order to make more plutonium and I do not believe 
the Russians have any interest in that and we would certainly 
not agree to it.
    That would then allow a potential path forward. The BN-600 
cannot eliminate all the 34 tons of MOX in any reasonable time. 
It would simply prove the technology and allow a Russian-
planned reactor called the BN-800, not yet built, to be a path 
for disposition.
    We intend to work with the Russians to continue to ensure 
that they live up to their end of the agreement. At the same 
time, I no longer believe that holding up U.S. construction is 
in our interest. I believe that because of the need to meet our 
own obligations and the relationship between a credible 
disposition path and material consolidation, that construction 
should go forward in South Carolina.
    With regard to the Government Accountability Office and the 
cost increase, there are three reasons for the cost increase. 
One reason is that the initial figures we gave the Congress in 
2002 were in constant 2001 dollars and we are now looking at 
out-year dollars.
    The second reason is that the initial figures we gave the 
Congress were based on an erroneous, as it turns out, belief 
that we would have an optimal funding profile and that has not 
proved feasible. As a result, our strategy now is to fund at a 
constant rate. So it is probable that the 2008 request will be 
very similar to the 2007 request. That is more efficient from 
the standpoint of orderly budgeting. It is less efficient from 
the standpoint of construction, so there is an increase.
    Then, as you correctly noted, we have had some management 
problems. Some of them have been caused by the protracted 
delay. Some of them have been caused by reductions, 
understandable reductions, based on the Russian delay. We are 
renegotiating the contract with DCS, the contractor. We decided 
to renegotiate rather than to recompete because I believe it is 
important to get on with it. We will have a 100 percent 
incentive fee. We will have stronger accountability and we will 
have new contractor management, and I believe that these steps 
will in fact give us greater assurance. I do not want to 
overpromise, Mr. Chairman. The Department's record on large-
scale construction projects is not one of the things to be 
hugely proud of. But I believe that we are now on top of this 
and that we will be able to go forward in a responsible manner.
    Senator Domenici. Maybe this is not a question for you, but 
let us just talk about this anyway. Why are we doing these 
things we are doing for the Russians? We started this program, 
these programs--the first of the kind was Nunn-Lugar. It took 
3, 4, 5 years for it to get operating. It is about 20 years 
old. At that point we had lots of potential proliferation 
around and the Russians had no money and things were really 
going to hell in a handbag.
    It was hard at first for Americans to get the idea that we 
ought to give them help, but we did, and we got into this in a 
big way. We got three major programs that we call 
nonproliferation in the world and almost all of the money goes 
to something that is Russian, including the safeguard program. 
That is still going in, is it not, where we make sure things 
are guarded properly?
    Ambassador Brooks. Yes, sir. Yes, sir.
    Senator Domenici. That is American money to safeguard 
things over there.
    Ambassador Brooks. Yes, sir.
    Senator Domenici. The reason I say I do not know if it is 
for you to answer, but why do we still do these things for 
Russia? Why do they not do it themselves?
    Ambassador Brooks. Well, increasingly they are, sir, and I 
agree.
    Senator Domenici. Wait a minute. You agree with what?
    Ambassador Brooks. I agree with what I take to be your 
view, that it is increasing for them to bear the burden of 
doing their own efforts.
    We support improving security in Russian nuclear material 
for the same reason we did when you and others started it, 
because we believe that it is the way you protect the United 
States.
    Senator Domenici. Absolutely.
    Ambassador Brooks. The best way to keep nuclear material 
out of the hands of those who would do us harm is at the 
source.
    At the same time, we are coming to the end of that phase 
and President Bush and President Putin have explicitly stated 
at Bratislava they want to see us move from assistance to 
partnership. We are going to finish our work in improving 
Russian security in 2008. In fact, the Russians have already 
picked up a substantial--some of the sites that when I sat 
before you last year I expected we would be doing, the Russians 
are now going to be doing.
    We are shifting our effort to much more of a collaborative 
understanding of sharing best practices, of working on how we 
make sure that they sustain this effort. So I think that, 
although perhaps less rapidly than you might like, we are 
moving away from sending money there.
    Senator Domenici. Well, I appreciate your answer, and I 
have not been back to Russia since we started this a long time 
ago. It was all different people and a completely different 
government, so I do not know how they feel or what they think 
about this dialogue here today.
    But this whole business of MOX and plutonium disposition 
and the 34 tons that we made a deal on, made an agreement on, 
it is incredible to me that they are ready to pay for all of 
this. It has taken us so long to get something done that it 
would appear to me this is in their benefit as much as ours or 
more. And we are having so much trouble getting it done.
    That is why I am pleased to hear you say that we ought to--
you did not use my language of ``de-link'' because that is too 
strong a word, but you indicated we should proceed----
    Ambassador Brooks. Yes, sir.
    Senator Domenici [continuing]. If I heard you right.
    Ambassador Brooks. Yes, sir, you did hear it right.
    Senator Domenici. You can rest assured that in the 
appropriations process to the extent that we can have anything 
to do with that, that is what we are going to say. It is a long 
way, we've been waiting long enough. America has a rare chance 
to make a breakthrough with MOX that we waited 25 years to do 
and should have done, and we just as well get on with it.
    I think the State that has agreed it has some empathy, 
deserves some empathy, too. They cannot sit around forever and 
wait either. Maybe others do not understand that, but we do. It 
is a tough program.
    Ambassador Brooks. Thank you, sir.
    Senator Domenici. So we understand each other on MOX, and 
on plutonium disposition what I have described is what we are 
going to do, and you can decide as the legislation moves 
through what the administration's position is going to be.
    Ambassador Brooks. Yes, sir.

                       NATIONAL IGNITION FACILITY

    Senator Domenici. All right. The NIF budget. Does the 
fiscal year 2007 budget support the administration's goal of 
ignition by 2010?
    Ambassador Brooks. Yes, sir, it does.
    Senator Domenici. Do you agree with the JASON's report on 
the NIF ignition plan, that it was fair and an accurate 
estimate of the NIF program?
    Ambassador Brooks. It was, and what it said was that they 
agree that we will be able to conduct the ignition experiment 
in 2010. They are less confident whether the first experiment 
will work, and we share this view. This is something that has 
never been done before. But we were pleased to see the JASON's 
report support the basic notion that the program is on track to 
conduct an ignition experiment in 2010. We intend to keep it on 
track.
    Senator Domenici. Well, they say that--the JASON report, 
which you believe to be an accurate report, stated that 2010 
ignition was ``unrealistic.'' If this top-caliber review 
believes this goal is unrealistic, then why should we support a 
budget request that makes deep cuts in all these other programs 
to support this program that says it is unrealistic to expect 
the 2010 ignition?
    Ambassador Brooks. Respectfully sir, what they said was 
that it was realistic to assume that we could meet our goal to 
conduct the experiment in 2010, that it was not clear--if you 
say they used the word ``unrealistic,'' I accept that; I do not 
remember it when I read the report--that it was not clear 
whether the first experiment would succeed.
    I will say it is unrealistic to assume that the first time 
you try anything that has never been done before that you can 
guarantee it is going to work. I do not want to suggest that I 
am promising the committee that we will achieve ignition on the 
first try. I believe that we will conduct an experiment in 
2010. I believe we have a chance that it will work. But they 
call it research because we have not done it yet.
    So I do think that the decisions we have made are sound, 
although I think that we will try to start shifting some 
resources as we get through this peak period in the NIF, I 
think we will try to shift some resources back to using some of 
the other tools in inertial confinement fusion. For example, 
the Z refurbishment project will be complete in fiscal 2007, 
and I think that we did in fact reduce the amount of money that 
went into some of the other valuable areas like Z and Omega.
    Senator Domenici. Well, the people at NIF know where this 
Senator stands and I stand by watching and waiting and hoping 
that it works. It is one of the biggest gambles I have ever 
voted for and, looking back on it, while I take great pride in 
saying I really love big science, that is one I would like to 
go back and see whether my arms would fit around it again. I am 
not quite sure they would.
    But, having said that, I see another Senator here and I 
have lots of questions, but he does not have as many as me, nor 
as much time. Would you have questions at this point?

                   STATEMENT OF SENATOR WAYNE ALLARD

    Senator Allard. Well, I do, Mr. Chairman, and thank you. 
Thank you for holding this hearing today. I do have a full 
statement I would like to make a part of the record if I might.
    Senator Domenici. It will be made a part of the record.
    [The statement follows:]

               Prepared Statement of Senator Wayne Allard

    Thank you Mr. Chairman for the opportunity to attend this hearing 
today.
    Ambassador Brooks, it is a pleasure to see you again. I enjoyed our 
meeting a couple of weeks and appreciate your taking the time to stop 
by. I want you to know that I support you and the rest of Department. I 
look forward to working with you this year.
    Mr. Chairman, I believe the Bush Administration has received far 
too little credit for its efforts to reduce proliferation and reduce 
the threat of a nuclear conflict. Many folks still have not recognized 
that the Treaty on Strategic Offensive Reductions (Moscow Treaty) will 
reduce the size of the U.S. stockpile to a level that has not been seen 
in 50 years. Indeed, we are pulling weapons out of the stockpile so 
fast that the Department of Energy had to double its fiscal year 2007 
budget request for dismantlement of nuclear weapons.
    And, the administration hasn't stopped there. Under your 
leadership, Ambassador Brooks, we are moving forward with the reliable 
replacement warhead program, which could further reduce the number of 
weapons in our stockpile. I think those who oppose this program have 
not really looked at it closely.
    Their opposition to the RRW program does not make sense when the 
only alternative is the costly refurbishment process. Their opposition 
certainly does not make sense if, as promised, this program results in 
significantly greater reductions in our stockpile.
    I firmly believe that nuclear weapons remain a critical element of 
our national security and are a significant deterrent to potential 
adversaries. The threat has not gone away and is unlikely to do so in 
the distant future. I think we can be much smarter and much more 
efficient in how we approach the stockpile without losing the 
effectiveness that we require. Programs like the reliable replacement 
warhead are a right step in this direction.
    Thank you Mr. Chairman for the opportunity to speak today. I look 
forward to the Ambassador Brook's testimony.

                 CHANGES IN THE NUCLEAR WEAPONS COMPLEX

    Senator Allard. I have a news release here where Mr. 
D'Agostino prepared a statement, I guess yesterday to the 
House, laying out the future of the nuclear weapons complex. I 
am wondering if maybe you might go into--as you know, I am 
interested in that.
    Ambassador Brooks. Yes, sir.
    Senator Allard. And I wonder if you might go into a little 
more detail than what I am seeing here.
    Ambassador Brooks. Certainly, sir.
    Senator Domenici. I see he is here. Whoever wants to do it.
    Ambassador Brooks. Well, let me.
    Senator Allard. Okay. Well, we can have--whatever, just so 
I get an answer.
    Ambassador Brooks. Let me try.
    Senator Domenici. Sure.
    Ambassador Brooks. We have pretty much all the knowledge we 
have got in this room, so we can tell you where we are going.
    We have for the last couple of years been looking at the 
question of the complex of the future. We had an external look 
done by the Secretary of Energy Advisory Board, and we received 
the report late last year. That external look recommended 
moving very quickly to a single site for everything that 
involves uranium and plutonium at a location yet to be 
determined and it made a number of other recommendations, many 
of which we have adopted.
    Our approach to the future of the complex has a number of 
parts. First, we intend to continue to emphasize the 
development of the Reliable Replacement Warhead because if we 
can simplify the ability to maintain and improve warheads then 
any complex can be made more efficient. So we see that as good 
in itself, but also as an enabler for the improved complex.
    Second, we believe that one of our weaknesses today which 
we do not need to wait for the future is that the complex does 
not function in an integrated manner. Deputy Administrator 
D'Agostino has already put out guidance to make our incentive 
package for each of the sites based in part on the ability of 
the whole complex to meet its requirements.
    Third, we think that we should dramatically reduce the 
number of places where we do plutonium and uranium work, both 
for efficiency, but in order to reduce the cost of security. 
For uranium, we believe that the investments we are making and 
have planned at Y-12 make it the long-term uranium, highly 
enriched uranium center for the United States. We are building 
a facility called the Highly Enriched Uranium Materials 
Facility, which will be the storage facility, the Fort Knox of 
uranium, if you wish, and we will be working with the Congress 
in coming years to build a facility next to it where all the 
uranium processing work is done.
    Putting these two facilities next to each other will do two 
things. It will dramatically reduce the number of buildings 
that actually have material in it and it will dramatically 
shrink the area that we have to guard and protect.
    With regard to plutonium, we believe that we should 
consolidate by the early 2020's essentially all plutonium work, 
both in making pits and in doing research on plutonium, at a 
single facility. Until that facility exists, the capability at 
Los Alamos will provide the interim capability.
    We believe that the long-term future of the weapons labs--
and we do not know where that plutonium facility should go, but 
our general view is it should go at an existing site that uses 
category I and category II material. We do not think it is 
particularly worth the physical and political cost of moving 
plutonium to places where it has never been.
    As a result, we intend to over time eliminate having 
special nuclear material at the three weapons laboratories. 
Sandia, which has the Sandia Pulse Reactor, has the primary 
material. We will finish the last series of experiments on that 
reactor later this year and we will be in a position to make 
Sandia special nuclear material-free.
    We expect to begin moving material out of Livermore in 
2008. I would like to be a little fuzzy right now about where 
we are going to put it, but we are going to begin moving it and 
intend to have Livermore free of special nuclear material by 
2012. One precursor to that is obviously we want both Los 
Alamos and Livermore to continue to have intellectual 
involvement in plutonium metallurgy, which is so crucial to the 
stockpile, and we are going to have to work arrangements so 
that can be done from a single consolidated site.
    Ultimately, if Los Alamos does not become the site of the 
new plutonium center, we would much later move out of Los 
Alamos. We intend to create a new non-nuclear production 
facility by 2012. Our facility in Kansas City is one of our 
best-run and best-managed facilities, but it is still operated 
as a government-owned, contractor-operated facility. It still 
has 3 million square feet of floor space and the United States 
does not need that, and we intend to move toward a different 
kind of facility. We still believe that there are things that 
need to be made under direct contract to us, that not all non-
nuclear components can you simply go out and procure. But we 
want to move to more commercial procurement where that is 
appropriate.
    We intend to make it clear to the Congress and the American 
people and the world that this is not the start of some new 
arms race, by accelerating the rate at which we dismantle 
weapons. Between 2006 and 2007, we will have a 50 percent 
increase in dismantlement and we are still looking at what we 
can do in the out-years.
    Finally, we intend to look with regard primarily to the 
laboratory complex. We believe that we should retain the three 
existing laboratories. We believe that we should work more 
diligently than we have to look at the one of a kind facilities 
as user facilities that truly support the entire complex. We 
also think that over time the more complex high explosive 
experiments should be centralized in Nevada.
    Then finally we have recently, inspired, to be candid, by 
some outside looks, we have concluded that any kind of 
complex--we have gotten too risk-averse. We have emphasized 
fourth decimal point analyses of safety over the expense of 
getting things done. So we are in the process of a series of 
internal looks to make sure that, whatever the complex of the 
future is, it will be operated more efficiently.
    So that is the broad approach. There are a number of things 
in this budget that will contribute to that approach, but we 
will obviously be working with the Congress in the coming 
years, most particularly as we start the process of making site 
selection for this consolidated plutonium center.

                           NUCLEAR MATERIALS

    Senator Allard. You are thinking the disposal site would be 
at Yucca Mountain in Nevada?
    Ambassador Brooks. I am assuming that at the moment. The 
complex makes--we make two assumptions. One is that, with 
regard to plutonium disposition, that it will leave the weapons 
system, if you will, through Savannah River. In terms of high-
level disposal, that is not our formal responsibility, but we 
are obviously assuming that Yucca is where--for example, I 
believe that almost certainly we will continue to decide we 
have too much plutonium and I believe that we will turn more 
and more of it into MOX fuel and that will go in commercial 
reactors, and the output of that is just like the output of any 
other commercial reactor. And at the moment Yucca is where that 
is slated to go.
    Senator Allard. Yes.
    Ambassador Brooks. But there is relatively little that goes 
directly from the weapons program into Yucca.
    Senator Allard. You are passing it through the MOX 
facility----
    Ambassador Brooks. Yes, sir.
    Senator Allard [continuing]. Which right now we have at 
Savannah River.
    Ambassador Brooks. Yes, sir.
    Senator Allard. And that is also used to reprocess spent 
nuclear rods.
    Ambassador Brooks. Well, the MOX facility does not at the 
moment.
    Senator Allard. It does not?
    Ambassador Brooks. No, sir.
    Senator Allard. Okay, but it has the capability to do that?
    Ambassador Brooks. No, sir.
    Senator Allard. We would have to build another facility to 
do that?
    Ambassador Brooks. Yes. The Department--I want to 
distinguish between things for which I have responsibility.
    Senator Allard. Okay.
    Ambassador Brooks. The Department as part of the global 
nuclear energy initiative will be recommending, has 
recommended, that we move to the construction of some 
demonstration facilities for both reprocessing and for an 
advanced burner reactor. We do not have sites located for that 
and they are not in the NNSA area of responsibility.
    Senator Allard. And those sites would be the MOX Plus, is 
that correct?
    Ambassador Brooks. I think that it is probably a better way 
to think of them as really sort of separate issues. The time 
scales are different. The principle is different. We looked at 
whether or not we should somehow combine all of this in one 
galactic program and decided we should not.
    Senator Allard. So, moving on then, if we should get in--we 
are going to have more nuclear power plants. If we are going to 
decide to reprocess those rods, you are thinking of a separate 
facility altogether.
    Ambassador Brooks. Yes, sir.
    Senator Allard. And in that process you will use--if I say 
the ``Plus MOX,'' you know what I'm talking about.
    Ambassador Brooks. Yes, sir.
    Senator Allard. I do not know what your official technology 
is there. But it is an enhanced reprocessing.
    Ambassador Brooks. Yes, sir. The vision that we have now--
when I say ``we'' I do not mean NNSA; I mean the administration 
generally--for the future of nuclear power has a number of 
components, but it is based on the belief that we should not 
plan to put once-through fuel in a geologic repository because 
(a) you are going to use up all the space available, and (b) 
you are in fact putting a lot of energy content there; and 
finally, you are putting a huge amount of stuff with very long 
half-lives, which means that you have to analyze for periods 
that are probably beyond our capability.
    So the idea is that we would take the fuel that comes out 
of traditional light water reactors, we would reprocess that 
through a new approach not previously used, that will give us a 
trans-uranic fuel, if you will, a fuel that is plutonium plus 
other trans-uranic isotopes, and that that fuel will go into 
fast reactors.
    What this will do for you is--there is still sooner or 
later going to be stuff that is going to go in a geologic 
repository. But the volume will be reduced substantially and 
the peak dose period will be reduced substantially and you will 
get more of the energy content out of the fuel.
    If you do that, then what you have to do is guard against 
any question that you are harming our traditional 
nonproliferation approach, which is one of the reasons the 
United States has been skeptical of reprocessing in the past. 
Our approach is to reprocess in a way that is different from 
traditional reprocessing and that makes the fuel less 
interesting--I do not want to say uninteresting, but less 
interesting from a proliferation perspective--but then also to 
create a global regime of essentially fuel leasing. That is not 
exactly the term we use, but where only a limited number of 
States would do this reprocessing and those are States with 
traditional strong safeguards.
    So what we think all this will do is it will allow us to 
meet the future energy needs through nonpolluting nuclear 
power, it will allow us to do that in a way that does not 
require small countries to bear all the burden of disposal, 
because large countries would send them fuel and then take it 
back for reprocessing, and that would not put us in the 
situation where we are now, where, depending on your 
projections of future nuclear power, we need nine more Yucca 
Mountains this century, which I think most of us believe are 
not likely to be easy to find.
    Senator Allard. Thank you, Mr. Chairman. His response took 
longer than I anticipated.
    Ambassador Brooks. My apologies.
    Senator Allard. I figured you would be interested in it, so 
I did not try and cut his response short. Thank you.
    Senator Domenici. It is all right. I was interested.
    Senator Allard. I figured you would share some interest 
there.
    Senator Domenici. I already knew about it, but I was 
interested.
    Senator Allard. I hope I did not duplicate a previous 
question you asked.
    Senator Domenici. No, no.
    I think the new word that we are all trying to use is 
``recycling''.
    Senator Allard. Yes, recycle.
    Senator Domenici. Instead of ``reprocessing''.
    Senator Allard. That is correct.
    Ambassador Brooks. Yes, sir.
    Senator Allard. It is an enhanced recycling process.
    Senator Domenici. Yes, it is recycling. And the process we 
are going to use has not been used before in full-scale. That 
is why this process is pretty risky, because it is going to 
take a long time. Everything sounded so nice, but you see, that 
means you are going to have Yucca sitting over here waiting for 
this new recycled fuel. It has got to wait over there, circling 
the globe, for about 30 years, it looks to me, 20, 30 years.
    I do not quite know how we are going to get legislation 
passed to do that.
    Senator Allard. Are we not in the courts on that right now, 
Mr. Chairman?
    Senator Domenici. Yes. But we have got to pass something 
soon deciding what happens to the Yucca property.
    Senator Allard. I see.
    Senator Domenici. The real estate, the railroads, and the 
physical site. And in doing that, we have got to kind of 
decide, kind of say what we are going to use it for, so Harry 
Reid will know. If nothing else, we have got to tell him. Right 
now we are telling him, it looks like we are telling the world 
we are going to put spent fuel rods in there.
    You just heard him say we are not going to do that. He said 
it round-about. But everybody is saying we are not going to do 
that. So we have got a facility that we are moving in that 
direction and we are not going to use it for that. We have got 
to change the law and say what is it we are going to use it 
for.
    And we have got one hang-up. There is a law that says we 
have got to put military waste in that facility, and we do not 
quite understand how that fits. I do not know, the Ambassador 
may have negotiated that arrangement. Maybe he knows. That is a 
big one. But if that was not in the way, we could make Yucca 
sit over there for 30 years and wait for this new recycled 
material.
    You understand, this new recycled material is a fantastic 
achievement, human achievement, if it works. Just remember this 
number: you reduce the quantity a hundred-fold. So if you are 
going to put a spent fuel rod in and it was going to take 100 
cubic feet and you do this recycling, it is going to be one 
cubic foot of material. That is pretty interesting, is it not?
    Senator Allard. It is, and I have seen part of that 
process.
    Senator Domenici. The process, what you have got left over 
is very easy to handle because it does not have the half-life 
that he spoke of generally.
    Senator Allard. With the enhanced process. I think that is 
wonderful.
    Senator Domenici. Right, terrific. Well, that is the 
President's GNEP program. That is what we are going to try to 
do. We do have some money in here; we are going to start it.
    Senator Allard. Good.
    Senator Domenici. Two hundred forty million dollars, $250 
million. But that is such a little down payment. Japan is 
interested, India is interested. Maybe we can start it and turn 
into an international program. They might be willing to help us 
pay for it.
    I am willing to give it a shot if I could figure out how 
Yucca fits in the middle of this.
    Senator Allard. Well, I am with you, Mr. Chairman.

                     LOS ALAMOS NATIONAL LABORATORY

    Senator Domenici. We will work on it.
    Let me talk down to these things that are important to 
people in New Mexico: the pension program over there at LANL. I 
sent you a letter urging you to oppose the University of 
California's efforts to separate the LANL pension from the 
broader university retirement system. I got your letter, in 
which you indicated you did not have enough information. Has 
anything changed since you wrote me the letter that might 
affect the LANL retirees?
    Ambassador Brooks. I continue to be absolutely committed, 
as I told you before, to making sure they are treated fairly. I 
continue to have nothing from the university other than what I 
have heard in the press. I am told that a letter will arrive 
shortly explaining what the university proposes. I have not 
seen it yet as of this morning. So I know nothing more than I 
knew when I signed the letter.

                   GLOBAL NUCLEAR ENERGY PARTNERSHIP

    Senator Domenici. I have one question on GNEP. Mr. Paul, 
can you please tell me what the NNSA role is in the Global 
Nuclear Energy Partnership and what NNSA's budget provided for 
2007 to 2011? Can you do that or, Mr. Ambassador, you do it, 
whichever?
    Ambassador Brooks. Mr. Paul is up here.
    Mr. Paul. Thank you for the question, Mr. Chairman. We just 
recently as of last week reached an understanding with the 
Office of NE, the Nuclear Energy Office, about the areas where 
NNSA would play in Global Nuclear Energy Partnership. They are, 
in broad categories: the development of the advanced safeguards 
and security technologies that are a key element to GNEP. They 
are the establishment of the reliable fuel services bank, that 
independent central bank, the 17.4 metric tons designated HEU 
to be blended down to LEU to allow recipient States to access 
that energy, in return for not developing a fuel cycle 
indigenously. And thirdly, providing the primary support for 
establishing the ``G'' and the ``P'' part of ``GNEP,'' the 
global partnership portion, that is putting together the 
supplier group partnership that you eloquently alluded to, 
France, Japan, Russia, China, United Kingdom, ourselves, with 
strong involvement by the IAEA, and potentially others, as well 
as the recipient State partnership, those countries that would 
forswear developing an in-house capability.
    Those are the three primary areas where the NNSA and 
largely NA-20, the nonproliferation shop, would play a lead 
role. The most significant area where we anticipate a budget 
impact would be in developing the safeguards technologies. We 
do not have a specific request in the 2007 budget for that 
because it is an extension of the current safeguard technology 
advancement work that we are doing, for example, at the Rekasho 
site in Japan. But we anticipate in the near future having a 
budget request tailored to those three areas, Mr. Chairman.
    Senator Domenici. I had two other questions with reference 
to GNEP and that pertain to you, Mr. Paul. I am going to submit 
them. You can answer them for the record.
    Mr. Paul. Thank you, sir.
    Senator Domenici. You have got 10 days, whatever it takes. 
We have some further questions that we will submit in writing, 
Mr. Ambassador.
    Senator, do you have any further question, either now or 
that you want to submit?

                     ADDITIONAL COMMITTEE QUESTIONS

    Senator Allard. I may have a couple of questions to submit 
later on, Mr. Chairman.
    Senator Domenici. All right. The record will be open for a 
couple of days for you to submit them.
    Senator Allard. That would be good, thank you. I will 
review with my staff.
    Senator Domenici. All right. If there are no further 
questions, we stand recessed, and we thank you for your 
testimony.
    Oh, I have one last thing, Mr. Ambassador. I make it as an 
observation and I should have done it in my opening remarks and 
I apologize. You still have a lot of contracts for big 
construction projects and big pieces of equipment and big 
things. You are still a big stuff guy. NIF is a big project, 
getting it finished. I want to make sure that you know that, 
even though we did not go through project by project, that we 
are asking you clearly to make sure that somebody is watching 
and being careful that those programs are being managed 
properly.
    We do not want overmanagement. That is, we do not want 10 
people managing the same thing. But we do not want to get 
caught with big errors that should have been found out months 
and months earlier dropped on our head at the last minute on 
any of these programs and projects. We have been told that that 
is not going to happen any more, and I would just like your 
thoughts on the subject. I know we have got new management in 
one laboratory and you have got a lot of other things going, 
but could you address that issue, please?
    Ambassador Brooks. And we also have new management at the 
Nevada Test Site, that started its transition today or 
yesterday and will be taking over this summer.
    The Secretary has made it very clear that he expects us to 
do a much better job at making promises that we can keep and 
then keeping our promises, and he regards stating that we are 
going to build something for a fixed amount of money in a fixed 
time as a promise. So he has made it very clear that he expects 
us to improve the Department's historic performance.
    Our performance right now is pretty good on those things 
that we have done before and pretty bad on these large, one-of-
a-kind projects. But we are gradually improving. We are 
absolutely committed to doing what you just told me to do, sir.
    Senator Domenici. Well, let us hope that that is the case. 
We do not have a lot of latitude in these budgets any more. We 
cannot have another NIF with a $200 million, $300 million, $400 
million disparity. We cannot pay for them. That is all there is 
to it. So I hope we are not going to destroy some laboratory 
because somebody makes a mistake.
    Ambassador Brooks. I have no intention of doing that, sir.
    [The following questions were not asked at the hearing, but 
were submitted to the agency for response subsequent to the 
hearing:]

            Questions Submitted by Senator Pete V. Domenici

             NATIONAL IGNITION FACILITY--COSTS AND FUNDING

    Question. Do we understand the costs of each of the three 
facilities (NIF, Z, and Omega)? Specifically: What is the relative cost 
of full-energy experiments on each facility?
    Answer. The current cost for a full energy shot at the Omega laser 
system is $10,000 per shot which includes operational costs of people 
and material, (including optics replacements) to operate the laser and 
full cost of laser and experimental diagnostics. Following completion 
of the OMEGA Extended Performance (EP) Project, the cost per shot for 
both OMEGA and OMEGA EP full energy operations will be approximately 
$25,000.
    In steady state operations, the equivalent facility cost at NIF 
will be approximately $550,000 per full energy shot.
    For the refurbished Z (ZR), the equivalent cost is approximately 
$100,000 per full energy shot.
    Question. Do we understand the costs of each of the three 
facilities (NIF, Z, and Omega)? Specifically: What will be the annual 
costs for activities at each facility in 2011--specifically what are 
the budgets from RTBF, Campaigns, DSW, and other activities such as DOE 
Office of Science and WFO at NIF, Z and Omega?
    Answer. In 2011, the annual facility costs for the National 
Ignition Facility (NIF), OMEGA and ZR will be approximately $150 
million, $25 million and $30 million respectively.
    In the fiscal year 2007 budget submission, 2011 facility and 
operations costs for OMEGA and NIF all appear in the Inertial 
Confinement Fusion Ignition and High Yield Campaign. The operations 
costs for ZR are in the Readiness in Technical Base and Facilities 
budget line.
    Program costs for the design and execution of experiments at these 
facilities are borne by Campaigns, Directed Stockpile Work, etc. 
Campaigns (other than the Inertial Confinement Fusion Ignition and High 
Yield Campaign) do not pay for facility or operations costs.
    Question. Although the NNSA is investing significant resources in 
understanding and mitigating the issue of optics damage on NIF, we 
understand that the present estimated cost of replacement optics on NIF 
is $900,000 for each full energy shot. We also understand that the 
operational costs of NIF have increased from the original estimate of 
$60 million per year to the present estimate of $150 million in fiscal 
year 2010.
    How do you measure the benefits realized from the costs at each 
facility--both benefits to the overall high-energy density physics 
program and the NW program?
    Answer. The annual operational cost estimate for the National 
Ignition Facility (NIF) has remained essentially constant in as-spent 
dollars since the new project baseline was established in fiscal year 
2001. There have been (and will continue to be) refinements in the 
estimates based on experience in operating the facility and changing 
economic conditions. Optics refurbishment costs are modeled using 
observations from the NIF Early Light campaign and off-line laboratory 
data and are consistent with the annual operational cost estimate to 
meet the 2010 and 2011 goals and steady state operations.
    The cost estimate for replacement/refurbishment of NIF optics is 
$30 million per year during steady state operations. This covers the 
full spectrum of energies planned for the experimental campaigns and 
corresponds to a per-shot optics refurbishment cost ranging from 
approximately $40,000 to $400,000.
    The benefits of NIF, OMEGA, and Z are measured by the degree to 
which they meet Stockpile Stewardship Program requirements. Experiments 
at these three facilities support weapon assessment and certification 
and are required to meet level 1 and 2 milestones contained in National 
Nuclear Security Administration (NNSA) implementation plans. As 
discussed in the 2001 NNSA High Energy Density Physics Study Report, 
each facility has unique capabilities and is a component of the 
integrated NNSA high energy density physics program. As an example, 
experiments conducted in fiscal year 2003 through fiscal year 2005 at 
OMEGA were essential in validation of a new Advanced Simulation and 
Computing (ASC) weapon secondary performance simulation code. 
Validation of this code was a major ASC milestone completed in December 
2005. Z has executed important experiments in materials science, 
nuclear weapon effects, and will shortly execute materials science 
experiments with special nuclear materials. NIF will examine issues 
related to thermonuclear burn in nuclear weapons and other important 
uncertainties that can only be addressed via access to the extreme 
conditions of matter NIF provides. NIF experiments in the thermonuclear 
burn area will address ``the most important outstanding issue in weapon 
physics,'' as stated by the Defense Science Board in the summer of 
2004. NIF ignition will also provide a critical integrated test of 
NNSA's simulation code and design capability.
    Question. What steps have been taken at each facility to minimize 
experimental costs and optimize scientific return? Has consideration 
been given to conducting staging experiments on smaller facilities in 
order to obtain optimal return from the high-cost experiments on NIF?
    Answer. Sandia National Laboratories (SNL) has effectively 
implemented a ``six sigma'' process which has been used to increase 
efficiency and reduce costs at Z and other Sandia facilities. The 
National Ignition Facility (NIF) Project has engaged external 
industrial participants and reviewers to carefully examine processes 
for installation of laser components and other ``mass-production'' like 
tasks required to complete the NIF Project. This has been important to 
the NIF Project achieving its cost, scope and schedule targets and will 
also enable efficient operations once the project is complete. The 
University of Rochester utilizes a rigorous process to extract the 
maximum number of OMEGA experiments in a given timeframe. Experimental 
scheduling and facility configuration are managed so as to allow the 
maximum amount of experimental shots per week.
    OMEGA and Z/ZR use a peer review process to judge experiments 
proposed for each facility. OMEGA and Z/ZR each have ``facility 
directors'' who are charged by NNSA with providing an experimental 
program that meets NNSA requirements and best satisfies the needs of 
Stockpile Stewardship. Evaluation of the performance of Z/ZR and its 
contribution to stockpile stewardship are a component of the NNSA 
annual evaluation of SNL. Similar processes will be in place for NIF 
following Project completion.
    The Inertial Confinement Fusion Campaign has always employed a 
staging strategy so as to allow effective use of all facilities. For 
the case of NIF, all National Ignition Campaign participants are 
engaged in developing integrated plans for optimally utilizing National 
Nuclear Security Administration facilities (OMEGA, Z/ZR and Trident) in 
support of the ignition goal. Integrated Experimental Teams with 
representation from all sites communicate regularly to develop and 
review plans for performing specific experiments at OMEGA, Z/ZR and 
Trident. As an example, hundreds of shots per year will be executed at 
OMEGA in support of the NIF indirect drive program between now and 
fiscal year 2010. When NIF is in full operation, a portion of OMEGA 
time will continue to be devoted to staging of experiments for NIF.
    Question. Given the high cost of experiments on NIF, does the NNSA 
plan to have users other than the ICF program pay full cost recovery to 
utilize NIF?
    Answer. The cost of National Ignition Facility (NIF) operations for 
Defense Programs and other Department of Energy users will be paid for 
directly by the National Nuclear Security Administration (NNSA). This 
is the same model used for OMEGA, Z/ZR, and other major NNSA 
facilities. NNSA also intends to pay the operational costs for the 
small fraction of NIF devoted to university use, in the same manner 
that operational costs for university use of OMEGA are covered.
    Operational costs for users external to NNSA and the Department of 
Energy will be paid for by the users. A few such experiments are under 
discussion but none are currently planned or funded.

                   NATIONAL IGNITION FACILITY BUDGET

    Question. Does the fiscal year 2007 budget support the 
administration's goal of ignition by 2010?
    Answer. Yes, the National Ignition Facility Project and the 
National Ignition Campaign are presently on schedule and within budget. 
The President's budget supports ignition experiments commencing in 
2010.
    Question. Do you agree that the JASON report on the NIF ignition 
plan was a fair and accurate estimate of the NIF program?
    Answer. The National Nuclear Security Administration (NNSA) agrees 
that the JASON report provides a valuable analysis of the ignition 
campaign including many useful recommendations. NNSA has already begun 
to implement many of these suggestions.
    NNSA does not, however, agree with all of the details of the 
report. In particular, we do not believe that there was adequate 
recognition of the role the advanced target design has played. In the 
last few years, advanced design has increased the margin for the first 
experiments making ignition possible for laser energies of one mega 
joule.
    Question. The JASON report, which you believe to be an accurate 
report, stated that ignition by 2010 was ``unrealistic.'' If this top-
caliber scientific review believes this goal to be ``unrealistic'', 
then why should we support a budget request that makes deep cuts to 
non-NIF sciences, such as Z, and makes reductions in the Science and 
Engineering Accounts to support a goal that is ``unrealistic''?
    Answer. It is important to recognize the context in which the JASON 
used the term ``unrealistic.'' To quote their report, ``While it is not 
impossible that everything will work `just so' in the very first 
ignition attempts, it is unrealistic to expect that to happen. However, 
that first campaign will be followed by two others in 2011, and each 
experiment will move the program toward the goal of achieving fusion 
ignition.'' In using the word ``unrealistic'' JASON is describing their 
assessment of the likely outcome of the first few shots (i.e., ``very 
first ignition attempts'') as opposed to the overall probably of 
success of the ignition campaign.
    The JASON report gave the following overall assessment of the plan 
for the pursuit of ignition: ``The Program has identified a series of 
tests of the key physical processes and diagnostic instruments that 
provides a reasonable roadmap for progress toward ignition after the 
initial attempts.'' The JASON report also states: ``First attempts to 
achieve ignition on NIF are likely to take place in 2010--this is an 
important and valuable goal that has strongly focused the efforts of 
the NIF Program.''
    In summary, JASON believes that while the initial attempts at 
ignition will not succeed, execution of the first ignition experiment 
promptly in 2010 will benefit the program, and the overall plan to 
achieve ignition is reasonable.
    Question. Your budget increases NIF experimentation, Demonstration 
and Ignition budgets by over $50 million. At the same time funding for 
non-NIF related science is down by $115 million. Funding for Z is cut 
by $30 million. I was also disappointed to learn that you have moved 
the entire Z machine budget to the Readiness and Technical Base and 
Facilities Account and removing it entirely from the inertial 
Confinement and High Yield Science Campaign.
    I believe the NIF-at-all-cost-attitude of your organization is 
short-sighted and irresponsible. Please explain why you ignored 
congressional direction to establish a balanced program for the ICF 
campaign?
    Answer. Of the $115 million quoted, at least $60 million represents 
congressional add-on activities which, while technically valuable, 
could not continue to be supported in the fiscal year 2007 budget 
request due to higher priorities and budget constraints. The $30 
million figure quoted for reduction at Z does not include Readiness in 
Technical Base and Facilities funds intended for Z operations. 
Accounting for this, places the reduction at about $14 million.
    The construction of the National Ignition Facility (NIF) and the 
execution of ignition experiments is a major commitment for the 
National Nuclear Security Administration (NNSA) and the Department of 
Energy. As stated in the 2001 High Energy Density Physics Study Report, 
however, a viable program at OMEGA, Z/ZR, and NIF is also needed to 
support Stockpile Stewardship. NNSA has maintained an adequate program 
at these three major facilities since the inception of NIF; however, 
budget constraints make this impossible in fiscal year 2007. The fiscal 
year 2007 budget request for the Inertial Confinement Fusion and High 
Yield Campaign is $85 million less in total than the fiscal year 2007 
Inertial Confinement Fusion and High Yield Campaign Future Years 
Nuclear Security Program budget shown in the fiscal year 2005 NNSA 
budget request.
    NNSA has chosen to reduce experimental availability at Z/ZR in 
fiscal year 2007 in order to maintain the schedule of the National 
Ignition Campaign as defined in the plan submitted to Congress in June 
2005. This reflects the importance of NIF and the ignition program. As 
the Z machine will be down for refurbishment in fiscal year 2007, the 
reduction to Z operations will impact the facility for only the latter 
portion of the year. NNSA intends to operate Z at the level required to 
support Stockpile Stewardship Program goals in fiscal year 2008. 
Experiments not conducted at Z/ZR in fiscal year 2007 will be 
rescheduled to fiscal year 2008 or later years with minimal long-term 
impact to Stockpile Stewardship.
    Question. Why is it no longer in the best interest of the NNSA to 
support a balanced program that will complement scientific research at 
all three institutions?
    Answer. The National Nuclear Security Administration (NNSA) 
believes it is important to support a balanced program in high energy 
density physics consistent with program priorities and the budget. As 
stated in the 2001 High Energy Density Physics Study Report, the 
National Ignition Facility (NIF), OMEGA, and Z provide complementary 
capabilities and are essential to the success of the Inertial 
Confinement Fusion Program and stockpile stewardship.
    NNSA has chosen to reduce experimental availability at Z/ZR in 
fiscal year 2007 in order to maintain the schedule of the National 
Ignition Campaign as defined in the plan submitted to Congress in June 
2005. This reflects the importance of NIF and the ignition program. As 
the Z machine will be down for refurbishment in fiscal year 2007, the 
reduction to Z operations will impact the facility for only the latter 
portion of the year. NNSA intends to operate Z at the level required to 
support Stockpile Stewardship Program goals in fiscal year 2008. 
Experiments not conducted at Z/ZR in fiscal year 2007 will be 
rescheduled to fiscal year 2008 or later years with minimal long-term 
impact to Stockpile Stewardship.
    The fiscal year 2007 budget request supports a solid program of 
experiments at OMEGA in support of the National Ignition Campaign. Non-
ignition weapon physics experiments have been realigned due to budget 
constraints. Experimental scope changes are being planned so stockpile 
program risks are minimized.

                         COMPLEX OF THE FUTURE

    Question. On Monday, Tom D'Agostino briefed me on the Nuclear 
Complex of the Future. The Department has developed a plan to 
consolidate its operations in fewer locations, which should reduce 
security costs and reduce the overall number of facilities the NNSA 
must maintain by 2030.
    In addition it supports the Reliable Replacement Warhead program 
and begins to catch up on the dismantlement of weapons no longer in the 
stockpile.
    What I believe is missing from this complex of the future is the 
decrease in the overall number of weapons. If we don't decrease the 
number of weapons, the complex will still need to support the same 
eight systems plus the RRW.
    It seems to me that you have traded off facilities, science and 
people but kept the same number of weapons and workload unchanged.
    Why doesn't this plan contain a proposal to support fewer weapons 
systems? What actions does the DOD need to see before it will release 
one of the aging weapons systems?
    Answer. Our Complex 2030 planning scenario is based on a smaller 
stockpile to meet the President's vision for the lowest number of 
warheads consistent with the Nation's security. However, pending a 
change in requirements from the Department of Defense (DOD), the 
National Nuclear Security Administration (NNSA) must support the 
current Nuclear Weapon Stockpile Memorandum signed by the President and 
the Joint DOD-NNSA Requirements Planning Documents as approved by the 
Nuclear Weapons Council.
    Ongoing discussions with the DOD indicate that progress on Reliable 
Replacement Warhead concepts and on actions to achieve a responsive 
nuclear weapons complex infrastructure as described in the 2001 Nuclear 
Posture Review would be major factors in changing existing DOD plans. 
In addition, NNSA must demonstrate that we can follow through on 
existing commitments as we transform the stockpile and its supporting 
infrastructure.
    Question. Has the DOE discussed with the DOD the benefits of 
reducing the diversity of weapon systems?
    Answer. The National Nuclear Security Administration (NNSA) has 
shared with the Department of Defense (DOD) the costs and benefits 
associated with maintaining specific warheads. As expected, the costs 
of maintaining a number of warhead types significantly exceeds the unit 
costs of maintaining specific quantities of any particular type of 
warhead. The DOD appreciates the assurance gained by avoiding single-
mode failures enabled by having diversity in the stockpile. Cost-
benefit analyses weighing the more quantitative costs of maintaining a 
number of warhead types compared to the harder-to-quantify benefits of 
warhead diversity are continuously made and figure heavily into 
discussions regarding the future stockpile.
    Question. Why don't you eliminate or delay the W-80 Life Extension 
Program?
    Answer. The Department of Defense (DOD) and the National Nuclear 
Security Administration (NNSA) are working in partnership to define the 
stockpile of the future. The 2030 stockpile that we envision would be 
smaller with a majority of warheads based on Reliable Replacement 
Warhead (RRW) concepts as well as a limited number legacy warheads that 
have been refurbished in life extension programs (LEPs). Thus we must 
support some number of legacy warheads, and their associated LEPs, even 
as we seek to evolve to a stockpile consisting primarily of RRW 
designs. In recent discussions, the DOD is working now to define plans 
for the future of nuclear cruise missiles. Pending a final decision 
from the DOD, the NNSA remains committed to supporting the plans 
contained in the current Nuclear Weapon Stockpile Memorandum signed by 
the President and the Joint DOD-NNSA Requirements Planning Documents as 
approved by the Nuclear Weapons Council.

                DEFENSE NUCLEAR FACILITIES SAFETY BOARD

    Question. The Defense Nuclear Facilities Safety Board has raised 
``safety basis'' issues over the past several years that have 
significantly impacted the throughput at Pantex. Deputy Secretary Sell 
has commented on the need for NNSA to retain risk-related decision-
making authority while assessing DNFSB recommendations.
    What actions has the NNSA taken to assure safety in its operations 
at Pantex while addressing the significant backlog in surveillance and 
dismantlement?
    Answer. For each nuclear weapon system, the National Nuclear 
Security Administration (NNSA) conducts an extensive hazard analysis 
and corresponding hazard mitigation process to assure safety of 
operations. This process is known as Seamless Safety for the 21st 
Century, SS-21. However, since the end of the Cold War, this process 
has become more and more risk averse. The zero-risk approach results in 
over-conservatism, which similarly impacts the ability to accomplish 
work at the Pantex Plant. Therefore, the NNSA is transitioning to a 
risk-informed decision approach that allows us to manage risk more 
effectively in ensuring safe and secure operations at Pantex and other 
facilities. The NNSA has several ongoing initiatives related to nuclear 
explosive operations that will incorporate this revised approach. These 
initiatives include the elimination of specific threats such as thermal 
and electro-static discharge via facility upgrades and modifications, 
the allowance of a more qualitative hazard analysis approach as opposed 
to the existing practice of over-conservative quantitative probability 
estimates, and the revision and clarification of existing rules and 
standards to reduce the possibility of misinterpretation and to confirm 
their added benefit to safety. These initiatives are ongoing and 
increased ability to perform work and reduction in backlogs should be 
realized starting in late fiscal year 2006.
    Question. How do the budget priorities reflect these decisions and 
what are examples of specific steps to increase throughput?
    Answer. The budget priorities reflect risk-related decision making 
in the fiscal year 2007 budgets and beyond. The dismantlement budget 
has been increasing since 2005 and the National Nuclear Security 
Administration (NNSA) is ensuring that all Stockpile Systems activities 
supporting the accomplishment of surveillance work at the Pantex Plant 
are funded. The corresponding Seamless Safety for the 21st Century (SS-
21) hazard analysis activities have top funding priority so that weapon 
operations are upgraded to new safety criteria.
    In early February 2006, the NNSA developed an extensive plan that 
contains several activities to increase throughput. The activities 
include steps to authorize specific multi-unit operations in Pantex 
facilities, additional facility configurations to prevent postulated 
accident scenarios, a review of existing Nuclear Explosive Safety 
practices and standards, additional hazard analysis process 
efficiencies, and a streamlining of the existing stockpile evaluation 
program.
    Regarding Defense Nuclear Facilities Safety Board recommendations, 
the NNSA expects that in early fiscal year 2007, the only open 
recommendation related to nuclear explosive operations at the Pantex 
Plant, Recommendation 98-2, ``Accelerating Safety Management 
Improvements at the Pantex Plant'', will be closed.
    Question. What actions has the NNSA taken to assure the ``safety 
basis'' process is fixed?
    Answer. Over the past 19 months, the National Nuclear Security 
Administration (NNSA) has initiated several activities to install risk-
informed decision-making throughout the nuclear weapons complex. These 
activities include an effort to identify and remove inefficiencies in 
our hazard analysis process, streamlining of the process itself, and 
better documentation and communication with the national laboratories 
and the Pantex Plant. Specifically, in early fiscal year 2005, the NNSA 
revised the process steps and interfaces between the national 
laboratories and the Pantex Plant for addressing identified hazard 
scenarios for nuclear weapons operations. This process revision is 
currently being implemented for the W76 and W80 Seamless Safety for the 
21st Century programs. The NNSA is also in the process of updating the 
standard approach for conducting hazard analyses.
    Question. How will the increase in W76 dismantlement and subsequent 
Life Extension Program rebuild affect throughput?
    Answer. For the W76, there is sufficient throughput planned at 
Pantex for both the dismantlement and Life Extension Program within the 
existing safety authorization basis. We are also examining increased 
throughput at Pantex by seeking improved means to mange risk in 
ensuring safe and secure operations at that facility.

                                  GNEP

    Question. Mr. Paul, can you please tell me what the NNSA's role is 
in the Global Nuclear Energy Partnership and what the NNSA budget 
provide for fiscal year 2007-fiscal year 2011?
    Answer. NNSA plays a key role in GNEP--to reduce the threat of 
nuclear proliferation through the enhancement of international regimes 
that advance nonproliferation goals and the deployment of safeguard 
technologies and systems. These missions are currently addressed by 
ongoing programs within our Office of Defense Nuclear Nonproliferation 
(NA-20). As such, initial support to GNEP is part of the base funding 
for this Office and additional funds for fiscal year 2007 were not 
requested. NNSA expects that future budget requests will be necessary 
but must be tied to the level of engagement by the international 
community in advancing GNEP concepts and initiatives such as the 
reliable fuel services, developing and deploying advanced safeguards, 
and collaboration on small-scale reactor development.

                   GLOBAL NUCLEAR ENERGY PARTNERSHIP

    Question. How does the NNSA nuclear weapons program contribute to 
our non-proliferation objectives?
    Answer. Having a safe, secure and reliable nuclear weapons 
stockpile is one element of our national security posture that 
contributes to the defense policy goals of dissuasion and assurance. As 
stated in the 2006 Quadrennial Defense Review, maintaining a robust 
nuclear deterrent helps the United States to ``shape the choices of 
countries at strategic crossroads.'' Potential adversaries are 
dissuaded from developing their own weapons of mass destruction 
programs because the United States nuclear forces are so powerful that 
trying to compete militarily is beyond the means of all but a few, 
already nuclear-weapons-capable countries. Our allies, such as Japan 
and the Republic of Korea, are assured of our willingness to come to 
their defense with our nuclear weapons if necessary, so they do not 
feel the need to develop their own nuclear weapons programs. 
Additionally, knowledge gained from research and development in our 
nuclear weapons program assists our intelligence community in 
developing key intelligence indicators of proliferant activity, 
enabling early intervention by all elements of national power--
diplomatic, economic, and military--to be engaged in efficient and 
effective nonproliferation activities.
    The nuclear weapons program also sets a high standard for material 
accountability, nuclear weapons safety and security, and identification 
and transfer of highly enriched uranium, that is excess to national 
security needs, for downblending. Finally, the weapon program 
organizations provide expert analysis and support to agencies that have 
a lead responsibility for special nuclear material detection, 
improvised nuclear device detection and defeat, and nuclear accident 
incident response.

                       NNSA MANAGEMENT OVERSIGHT

    Question. Over the last 5 years, we have had several events within 
the Complex that have caused this committee great concern. They 
include: (1) Multi-billion dollar cost growth and delay of the NIF at 
LLNL; (2) Pantex production plant that has come to an effective 
standstill, without producing one refurbished device in almost a year; 
(3) The LANL shut down; (4) Mixed Oxide Facility--the estimated cost 
has risen from roughly $1 billion to an estimated $3.5 billion; (5) A 
major error in the construction of a multi $100 million uranium storage 
facility at Y-12 that halts construction and jeopardizes the secure 
storage of enriched uranium.
    I am interested to know why you believe the NNSA has had such 
difficulty in delivering these projects on time and on budget. What 
actions is NNSA taking to prevent such occurrences in the future?
    Answer. There have been problems with specific projects and our 
analysis has led to both project specific remedies and overall process 
improvements within the National Nuclear Security Administration 
(NNSA). Although the specifics of the cited examples vary widely, they 
share three attributes--each developed over a long period of time; each 
involved the actions and decisions of many levels of management; and 
each involved significant stakeholder issues.
    My senior management and I intend to prevent such occurrences in 
on-going and future projects. Each of us, in dealing with subordinates 
and with each other, will avoid or substantially reduce the potential 
risk of problems of this type arising in the future by holding up all 
actions and decisions to five screening criteria:
  --Does the change improve line accountability?
  --Does the change cause people to be more or less risk adverse?
  --Does the change reduce micromanagement?
  --Does the change comply with Headquarters/site office Feds set what 
        must be done and contractors determine how it is done?
  --Is the change cost effective?
    The first criterion--line accountability--is the unifying thread 
for all five. This is a continuous, real time accountability, not an 
``after-the-fact'' surrogate accountability accompanied with 
punishment. It is imperative that all members of NNSA's dual lines of 
accountability--programmatic accountability for setting goals and 
operational accountability for conducting work--acknowledge openly all 
factors affecting their actions, the unfolding of the consequences of 
their actions over time; and the probable end result of those actions. 
That acknowledgement, shared up and down the chain of authority, will 
create a real-time accountability whereby each person will hold 
themselves and their subordinates accountable for the performance of 
their programs and their sites.
    This is not a simple task. NNSA's dual lines of accountability 
operate within a gauntlet of external players who could impose 
decisions sharply focused on narrow segments of large interacting 
systems. There is an ever-present temptation for line management to 
adopt these narrow solutions solely to avoid risks inherent in doing 
otherwise. More subtly, well-intended line management can usurp the 
authority of subordinates through overly prescriptive goals and 
policies. This real-time accountability will hold each individual 
accountable for inappropriate avoidance of risks, for micromanagement, 
and for making proactive, real-time course corrections when we realize 
operations are heading other than toward the intended goal. These five 
questions seem simple on their face, however if used aggressively, 
daily, and purposefully from my level out to the factory floor they 
will shape the performance of NNSA and support cost-effective success 
across the complex.

                   SPECIAL NUCLEAR MATERIAL SECURITY

    Question. Doesn't it make sense to consolidate the SNM to the 
minimum number of locations? Why don't you immediately take those 
actions to relocate the SNM to LANL, Pantex or Nevada?
    Answer. We strongly agree with the principle of consolidating 
special nuclear material (SNM) to a fewer number of locations. We 
started consolidating Category I/II SNM to fewer sites, and to fewer 
locations within sites. We will improve the long-term security posture 
at our national laboratories by phasing out operations involving Cat I/
II quantities of SNM. This includes eliminating the need for a Cat I/II 
SNM security posture at Sandia National Laboratories in New Mexico by 
2008. Our plan is to remove all Cat I/II SNM from Lawrence Livermore 
National Laboratory by the end of 2014. By 2022, all research and 
development (R&D)/production activities involving Cat I/II SNM would 
cease in facilities operated by Los Alamos National Laboratory. As that 
is accomplished, these labs could transition to a common defense 
industry site security posture with reduced security costs. The 
consolidated plutonium center, once operational, would host all R&D, 
surveillance, and manufacturing operations involving Cat I/II 
quantities of plutonium. The Uranium Processing Facility at the Y-12 
National Security Complex would consolidate existing highly enriched 
uranium contained in legacy weapons, dismantle legacy warhead 
secondaries, support associated R&D, and provide a long-term capacity 
for new secondary production. As a result, Y-12 would reduce its 
production and SNM storage footprint by about 90 percent, leading to 
significantly reduced costs for physical security at that site.
    Question. What are your plans to control security costs without 
consolidating SNM to a minimum number of locations? What number is 
that, and why is that the minimum number? Does not the consolidation of 
SNM also save substantially in the STA costs of the department as well? 
If not, why not?
    Answer. We strongly agree with the principle of consolidating 
special nuclear material (SNM) to a fewer number of locations to 
control security costs. However, we do not propose to consolidate at a 
single location. Instead, we propose to consolidate to centers of 
excellence with Category I/II quantities of SNM for: (1) uranium; (2) 
plutonium; (3) weapon assembly/disassembly involving high explosives; 
and, (4) large-scale testing. We will improve the security posture and 
reduce costs at our national laboratories by phasing out operations 
involving Category I/II quantities of SNM. Thus, there will be four or 
fewer sites in the long-term with SNM requiring costly security.
    In the long-term, consolidation of SNM will save secure 
transportation asset (STA) costs for the Department as well. However, 
moving material to de-inventory a site does increase the number of 
shipments and resulting costs in the near term.

                           ``Z'' 5-YEAR PLAN

    Question. The NNSA's fiscal year 2007 congressional budget request 
for the Inertial Confinement Fusion Ignition and High Yield Campaign 
eliminates technical alternatives and near-term stockpile support 
within the National HEDP program by redistributing resources from 
fiscal year 2007 to fiscal year 2010 in order to focus on performing 
the first ignition experimental campaign on NIF in fiscal year 2010.
    What is the administration's plan to restore balance within the 
national program and utilize the complementary strengths and 
capabilities of Z, Omega and NIF to ensure the short-term as well as 
the long-term health our nuclear deterrence?
    Answer. The National Nuclear Security Administration (NNSA) budget 
request for fiscal year 2007 is highly constrained. NNSA has chosen to 
reduce experimental availability at Z/ZR in fiscal year 2007 in order 
to maintain the schedule of the National Ignition Campaign as defined 
in the plan submitted to Congress in June 2005. This reflects the 
importance of the National Ignition Facility (NIF) and the ignition 
program. As the Z machine will be down for refurbishment in fiscal year 
2007, the reduction to Z operations will impact the facility for only 
the latter portion of the year. NNSA intends to operate Z at the level 
required to support Stockpile Stewardship Program goals in fiscal year 
2008. Experiments not conducted at Z/ZR in fiscal year 2007 will be 
rescheduled to fiscal year 2008 or later years with minimal long-term 
impact to stockpile stewardship.
    The fiscal year 2007 budget request supports the level of 
experiments at the OMEGA laser facility required to support the 
National Ignition Campaign. Support for non-ignition weapon physics 
experiments has been realigned due to budget constraints. Experimental 
scope changes are being planned so stockpile program risks are 
minimized.

               BALANCED NATIONAL PROGRAM--NIF AT ALL COST

    Question. Clearly the NNSA has decided against a balanced program 
for High Energy Density Physics program. NIF funding is up and every 
competing technology is down or removed from the program entirely.
    Given the series of successes in high energy density physics with 
pulsed power technologies and the planned completion in fiscal year 
2007 of NNSA's 5-year investment of ($165 million) in the Z 
refurbishment project, doesn't it make sense to increase, not decrease 
the funding for this facility in order to optimally utilize its 
anticipated world record X-ray energy output and other enhanced 
capabilities?
    Answer. The fiscal year 2007 National Nuclear Security 
Administration (NNSA) budget is highly constrained. NNSA has chosen to 
reduce experimental availability at Z/ZR in fiscal year 2007 in order 
to maintain the schedule of the National Ignition Campaign as defined 
in the plan submitted to Congress in June 2005. This reflects the 
importance of the National Ignition Facility (NIF) and the ignition 
program. As the Z machine will be down for refurbishment in fiscal year 
2007, the reduction to Z operations will impact the facility for only 
the latter portion of the year.
    As stated in the 2001 High Energy Density Physics Study Report, 
NIF, OMEGA, and Z are essential to the success of Stockpile 
Stewardship. NNSA agrees that the sensible path is to use the 
refurbished Z and its enhanced capabilities in support of Stockpile 
Stewardship. Accordingly, NNSA intends to operate Z at the level 
required to support Stockpile Stewardship program goals in fiscal year 
2008. Experiments not conducted at Z/ZR in fiscal year 2007 will be 
rescheduled to fiscal year 2008 or later years with minimal long-term 
impact to Stockpile Stewardship.
    NNSA has carefully reexamined the needs of the Stockpile 
Stewardship Program and concluded that near-term program needs for 
fiscal year 2008 and beyond can be met with approximately a single 
shift of operations at Z/ZR. This is the historical level at which NNSA 
has funded the operations of Z. While an additional shift of operation 
would allow greater exploitation of the significant scientific 
opportunities at Z/ZR, tough choices have been made within the current 
constrained budget environment.
    Question. From a risk management perspective, is it a sound 
strategy to put our resources disproportionately on the NIF technology 
and the associated approach to ignition, eliminating balance in the 
National ICF Program?
    Answer. Since the inception of the Inertial Confinement Fusion 
(ICF) program, the National Nuclear Security Administration (NNSA) has 
supported numerous technologies and alternative approaches to 
demonstrating inertial fusion ignition. Review committee reports from 
the National Academy of Sciences and other groups have urged the NNSA 
to focus on the demonstration of ignition using high power solid state 
lasers (the National Ignition Facility (NIF) and OMEGA), as this was 
the lowest risk and most expeditious path to success. NNSA agrees with 
this conclusion and has focused on the solid-state laser path to 
ignition since the mid 1990's.
    It is a sound strategy to maintain an appropriate level of 
technical diversity and risk mitigation within the program. The NIF 
ignition program itself includes two major approaches to ignition, 
namely indirect drive and direct drive. Within each of these programs a 
wide variety of target and laser configurations is available for 
ignition attempts; this provides further risk mitigation.
    Pulsed power offers an important alternate approach for the longer 
term, but no current analyses indicate that it could produce ignition 
conditions similar to NIF with the scale of the ZR machine. A goal of 
the NNSA ICF Campaign is to use Z/ZR to define the physics requirements 
for pulsed power ignition by 2015. Assuming pulsed power fusion turns 
out to be feasible, a robust ignition capability based on Z-pinch 
technology would thus require a new machine and would not be available 
for many years. The funding issues associated with Z operations in 
fiscal year 2007 are primarily a 1-year problem and should not disrupt 
NNSA's overall fusion strategy.
    In summary, NNSA's strategy is to demonstrate ignition in the near 
term with high power lasers and assess the feasibility of Z-pinches as 
a possible future fusion capability.
    Question. If the Z-pinch high-yield approach is the approach to 
risk mitigation--in the event that NIF fails--are we adequately funding 
the Z-pinch approach, and, more broadly are we performing the necessary 
assessment of the required next generation pulsed-power technology?
    Answer. The Z-pinch program is not the only approach to risk 
mitigation within the Inertial Confinement Fusion Program. The National 
Ignition Facility ignition campaign includes two major alternatives, 
indirect and direct drive. In addition, within each of these 
alternatives there is a wide range of target and laser configurations 
available. As discussed by JASON and other review committees in the 
past, this provides substantial risk mitigation.
    The assessment of pulsed power fusion is also an important 
component of the National Nuclear Security Administration's (NNSA) 
long-term plans for fusion. There is a specific NNSA program goal to 
define the physics requirements for pulsed power ignition by 2015. The 
reduction of shots available at Z/ZR in the latter portion of fiscal 
year 2007 is a short-term issue that will not unduly impact this 
overall strategy.
    Question. What strengths does each facility (OMEGA, Z and NIF) 
bring to the national high energy density physics program?
    Answer. As stated in the 2001 High Energy Density Physics Study 
Report, lasers and the Z pulsed power machine are complementary; each 
provides unique capabilities for the Stockpile Stewardship Program. 
Lasers (because of their high energy density) provide access to extreme 
conditions of temperature and pressure unattainable at Z/ZR. Z, on the 
other hand, provides a cost effective access to large-scale experiments 
because of its high total X-ray energy output.
    The OMEGA laser supports both indirect (X-ray) and direct drive 
experiments. OMEGA also possesses a very large suite of diagnostics. 
OMEGA's high shot rate and precision diagnostics provide an important 
capability for experiments where large amounts of data are required. 
OMEGA is an essential component of the National Ignition Campaign and 
will also serve as the major near term laser experimental capability 
for non-ignition weapon physics experiments. The OMEGA Extended 
Performance laser will provide a valuable capability for diagnostic and 
other measurements at OMEGA.
    The National Ignition Facility (NIF), with its much larger total 
energy and power, will be able to reach the extreme temperatures and 
densities required in many weapons experiments. NIF can produce energy 
densities approximately 20 times greater than those achievable at OMEGA 
or Z/ZR. It is also the only venue for producing thermonuclear 
ignition--a key Stockpile Stewardship Program requirement.
    Z/ZR is ideally suited for experiments where large X-ray energies, 
lower energy densities, and longer experimental durations are required. 
Z is also well suited to conduct certain materials property 
experiments; a particularly important example is material properties 
experiments with special nuclear materials, which are planned for the 
near future. The Z-Beamlet laser provides a powerful capability for 
diagnosis of Z/ZR experiments.
    Question. Why is funding for direct drive ICF included in the 
national program to perform the first X-ray driven ignition campaign in 
fiscal year 2010?
    Answer. Given the current status of Inertial Confinement Fusion 
technology, direct drive is the most important risk mitigation or 
backup to the indirect drive experiments in 2010. A specific effort is 
underway for developing direct drive and some preliminary experiments 
will be possible in the 2011-2012 timeframe. The National Ignition 
Campaign plan includes a decision point for these experiments in fiscal 
year 2009.
    The University of Rochester is a major partner in the National 
Ignition Campaign and is responsible for a major piece of the National 
Ignition Facility (NIF) indirect drive ignition program. The University 
of Rochester also continues to make excellent progress in inertial 
fusion research. As an example, University of Rochester scientists 
recently executed the first ever OMEGA cryogenic direct drive implosion 
experiment in which unwanted surface roughness in the solid deuterium-
tritium region was removed via use of the heat-generated from the beta 
decay of tritium. This so-called ``beta layering'' technique will also 
be used at NIF. The experience gained from cryogenic experiments at the 
University of Rochester will be important to timely implementation of 
cryogenics at NIF.
    Question. What fraction of the budget is being identified to 
address new technologies and scientific breakthroughs?
    Answer. Excluding construction, the National Nuclear Security 
Administration estimates that approximately $20 million per year 
(averaged over the current 5-year Future Years Nuclear Security Program 
period) within the Inertial Confinement Fusion and High Yield Campaign 
fiscal year 2007 budget submission is devoted to new technologies in 
addition to the mainstream National Ignition Facility indirect and 
direct drive ignition programs. This includes $11 million per year 
devoted to pulsed power fusion. The remainder of the $20 million is 
devoted to short pulse laser-matter research (including petawatt laser 
work) at the national laboratories and the University of Rochester 
Laboratory for Laser Energetics as well as university activities. 
Pulsed power fusion activities are aimed at evaluating the physics 
feasibility and technical requirements of this concept by 2015.
    The achievement of ignition is itself a major scientific 
breakthrough. Many significant breakthroughs in laser technology, 
plasma physics, and other fields will make this achievement possible.

          SECRETARY OF ENERGY ADVISORY BOARD RELATED QUESTIONS

    Question. The DOE received the draft of the SEAB nuclear weapons 
complex infrastructure task force (NWCITF) report in mid-July 2005 and 
the official SEAB report on October 4, 2005.
    What is the DOE's specific position on the 5 recommendations made 
in the report?
    Answer. Our positions on the 5 recommendations made in the report 
are set out in the following table.

------------------------------------------------------------------------
                                              National Nuclear Security
      SEAB Task Force Recommendations        Administration Complex 2030
                                                   Recommendations
------------------------------------------------------------------------
Design Reliable Replacement Warhead (RRW)   Same.
 immediately.
Accelerate dismantlements.................  Same.
Establish Office of Transformation........  Same.
Establish Consolidated Nuclear Production   Establish distributed
 Center (CNPC) by 2015.                      production centers of
                                             excellence with a
                                             consolidated plutonium
                                             center at an existing Cat I/
                                             II SNM site by early
                                             2020's.
Consolidate all Category I/II special       Consolidate Cat I/II SNM to
 nuclear material (Cat I/II SNM) to CNPC     fewer sites and fewer
 long-term.                                  locations with sites;
                                             remove Cat I/II SNM from
                                             laboratories.
------------------------------------------------------------------------

    Question. If the SNM manufacturing and weapons storage were 
underground in tunnels mines, would that not significantly reduce the 
physical security costs for the complex?
    Answer. Special nuclear materials (SNM) can be adequately protected 
in either above-ground or underground facilities. SNM manufacturing and 
weapons storage underground in tunnels or mines does offer 
opportunities to reduce the physical security costs for the complex. 
However, the cost of construction, operations, and maintenance for 
underground facilities can be greater than structures on the surface. 
In the end, we must balance total costs, operational efficiencies, and 
long-term mission compatibility. We intend to begin a National 
Environmental Policy Act (NEPA) process to evaluate the impact of 
reasonable alternatives. In parallel with this NEPA process, we plan to 
complete independent business case assessments of the alternatives.

                    NATIONAL IGNITION FACILITY PLANS

    Question. In November 2005, DOE issued a Record of Decision in the 
Site-wide Environmental Impact Statement on Livermore Lab Operations 
that gave the ``green light'' to construction of a large neutron 
spectrometer for NIF. The neutron spectrometer does not appear to be 
reflected in the budget.
    What will its ultimate construction costs be? What is its 
construction schedule and what is its purpose?
    Answer. The Department of Energy (DOE) ``Site-wide Environmental 
Impact Statement for Continued Operations of Lawrence Livermore 
National Laboratory and Supplemental Stockpile Stewardship and 
Management Programmatic Environmental Impact Statement'' evaluated the 
environmental impacts of the proposed construction of a large neutron 
spectrometer for the National Ignition Facility. The Environmental 
Impact Statement and its Record of Decision do not represent a DOE 
programmatic decision to proceed with this spectrometer. Alternate 
approaches have been identified for neutron spectroscopy that do not 
require the construction of the large neutron spectrometer.
    Question. In the same November 2005 Record of Decision, DOE 
determined it would conduct experiments with plutonium, highly enriched 
uranium, thorium 232, lithium hydride and other fissionable materials 
and in NIF. I see no mention of this change in the budget request.
    When will the experiments with plutonium begin and when will the 
experiments with the other new materials begin?
    Answer. The Department of Energy ``Site-wide Environmental Impact 
Statement for Continued Operations of Lawrence Livermore National 
Laboratory and Supplemental Stockpile Stewardship and Management 
Programmatic Environmental Impact Statement'' evaluated the 
environmental impacts of the proposed use of plutonium, other fissile 
materials, fissionable materials, and lithium hydride in experiments at 
the National Ignition Facility. The Record of Decision provides 
appropriate National Environmental Policy Act analysis should the 
National Nuclear Security Administration decide at a later date whether 
to perform experiments with some or all of these materials. There is a 
proposal under consideration to conduct experiments with milligram 
quantities of specially prepared plutonium. In addition, non-ignition 
experiments with lithium hydride have also been proposed. If there were 
a programmatic decision to conduct these experiments, they would begin 
around 2012. None of these experiments requires modification of the 
chamber and do not represent any additional cost beyond the planned 
experimental budget for 2012.
    Question. The Final Site-wide Environmental Impact Statement on 
Livermore Lab Operations mentioned that the NIF design would need to be 
modified to accommodate the plutonium experiments, in particular.
    When will these modifications begin and when will they be complete?
    Answer. The Department of Energy (DOE) ``Site-wide Environmental 
Impact Statement for Continued Operations of Lawrence Livermore 
National Laboratory and Supplemental Stockpile Stewardship and 
Management Programmatic Environmental Impact Statement'' evaluated the 
environmental impacts of the proposed use of plutonium, and other new 
materials (e.g., highly enriched uranium, thorium-232, lithium hydride 
and other fissionable materials). The Environmental Impact Statement 
and its Record of Decision do not represent a DOE programmatic decision 
to proceed with these experiments. There is a proposal to begin 
experiments with small quantities of specially prepared plutonium in 
fiscal year 2012. In addition, non-ignition experiments with lithium 
hydride have also been proposed. If there were a programmatic decision 
to conduct these experiments, they would begin around 2012. None of 
these experiments requires modification of the chamber and do not 
represent any additional cost beyond the planned experimental budget 
for 2012.
    Question. What is the approximate cost of modifying NIF to conduct 
these experiments?
    Answer. The Department of Energy (DOE) ``Site-wide Environmental 
Impact Statement for Continued Operations of Lawrence Livermore 
National Laboratory and Supplemental Stockpile Stewardship and 
Management Programmatic Environmental Impact Statement'' evaluated the 
environmental impacts of the proposed uses of plutonium, and other new 
materials (e.g., highly enriched uranium, thorium-232, lithium hydride 
and other fissionable materials). The Environmental Impact Statement 
and its Record of Decision do not represent a DOE programmatic decision 
to proceed with these experiments. There is a proposal to begin 
experiments with small quantities of specially prepared plutonium in 
fiscal year 2012. Planned contamination control measures for other 
National Ignition Facility materials (e.g., beryllium, depleted 
uranium, activated metal particulate, and tritium) will be adequate to 
manage the use of specially prepared plutonium. In addition, non-
ignition experiments with lithium hydride have also been proposed. If 
there were a programmatic decision to conduct these experiments, they 
would begin around 2012. None of these experiments requires 
modification of the chamber and do not represent any additional cost 
beyond the planned experimental budget for 2012.
    Question. What will conducting experiments with plutonium add to 
the NIF operating costs and what impacts will the other radioactive 
material have on NIF costs? Are these included in the budget? If so, 
where--what about in fiscal year 2008-2011?
    Answer. For the proposed experiments with specially prepared 
plutonium, no special modifications to the National Ignition Facility 
(NIF) chamber would be needed. Planned contamination control measures 
for use of other NIF materials (e.g., beryllium, depleted uranium, 
activated metal particulate, and tritium) will be adequate to manage 
the use of specially prepared plutonium. There are no additional 
operating costs to conduct these experiments.
    The Department of Energy ``Site-wide Environmental Impact Statement 
for Continued Operations of Lawrence Livermore National Laboratory and 
Supplemental Stockpile Stewardship and Management Programmatic 
Environmental Impact Statement'' evaluated the environmental impacts of 
the proposed use of plutonium, other fissile materials, fissionable 
materials, and lithium hydride in experiments at NIF. The Record of 
Decision provides appropriate National Environmental Policy Act 
analysis should the National Nuclear Security Administration decide at 
a later date whether to perform experiments with some or all of these 
materials. There is a proposal under consideration to conduct 
experiments with milligram quantities of specially prepared plutonium. 
In addition, non-ignition experiments with lithium hydride have also 
been proposed. If there were a programmatic decision to conduct these 
experiments, they would begin around 2012. None of these experiments 
requires modification of the chamber and do not represent any 
additional cost beyond the planned experimental budget for 2012.
 defense nuclear facilities safety board active confinement ventilation
    Question. I understand the DNFSB is pushing the Department to 
deploy active confinement ventilation systems for all Hazard Category 2 
and 3 facilities.
    I understand by applying this technology, at all DOE/NNSA 
facilities would be extremely expensive. Does the Department have a 
cost estimate for such retrofits?
    Answer. The Department of Energy (DOE) has developed a set of 
Evaluation Guidelines (February 2006) to review the efficacy of 
existing ventilation systems for applicable facilities across the 
Complex (some of which are active and some passive) to assess their 
performance attributes subsequent to hypothetical accident conditions. 
DOE intends to apply these Evaluation Guidelines in the near future. 
From the evaluations attendant to the Defense Nuclear Facilities Safety 
Board recommendation, DOE would be able to determine what, if any, 
modifications to ventilation systems might be required and what their 
costs would be. These data are not currently available.
    Question. Has this request by the DNFSB adversely impacted any 
current projects?
    Answer. No modifications to any facility have yet been made 
pursuant to the Defense Nuclear Facilities Safety Board recommendation 
concerning active confinement and no facility has been significantly 
impacted by the recommendation.
    Question. Is this active ventilation systems fool-proof?
    Answer. No, active ventilation systems are not fool-proof. The 
utility of an active system depends upon its active components, such as 
fans, and the passive components, like filters, working properly in the 
applicable conditions.

             RELIABLE REPLACEMENT WARHEAD--AGENT FOR CHANGE

    Question. The NNSA fiscal year 2007 budget request continues to 
support the current Life Extension Programs while the Reliable 
Replacement Warhead (RRW) studies are completed. The RRW program has 
the potential to serve as a means to transform the stockpile.
    Please explain the timeframe for integration of the RRW program 
into the Overall plan for Life Extension.
    Answer. Two design teams that are being led by our nuclear weapons 
laboratories--one from Los Alamos National Laboratory and one from 
Lawrence Livermore National Laboratory, both supported by the 
production agencies and Sandia National Laboratories--are engaged in a 
Reliable Replacement Warhead (RRW) design competition that will be 
completed later this year (November 2006). Upon favorable completion of 
the current study, we will work with the Department of Defense (DOD) to 
establish an RRW strategy as the ``enabler'' for stockpile 
transformation. This will include establishing an RRW-based stockpile 
plan before the end of 2007. The plan would also define the number of 
legacy warheads of specific types that are processed through life-
extension programs. If RRW concepts are feasible and benefits 
consistent with expectations, we will seek authorization to proceed to 
engineering development and production consistent with a Nuclear Weapon 
Stockpile Memorandum signed by the President and the Joint DOD-National 
Nuclear Security Administration Requirements Planning Documents as 
approved by the Nuclear Weapons Council.

                             NNSA VACANCIES

    Question. I have continued to observe the number of ``vacant'' and 
``acting'' positions within the NNSA and the apparent difficulty in 
attracting suitable candidates.
    What is the plan to address this shortfall in staffing and 
leadership for these critical programs?
    Answer. NNSA did have a number of ``vacant'' positions, but has 
closed that gap considerably. In fact, NNSA's critical positions are 
over 98 percent filled. Consequently, NNSA does not now have a serious 
staffing shortfall in leadership or most other critical positions. NNSA 
has an aggressive approach and comprehensive programs of recruitment 
and retention to ensure that we do not encounter critical staffing and 
leadership shortfalls in the future. NNSA has occasional difficulty in 
filling positions in highly select circumstances, such as at remote 
locations like Los Alamos, New Mexico, or when seeking highly selective 
technical skills such as facility safety representatives, contracting 
officers, and computer scientists. Overall, NNSA is not experiencing 
difficulty in attracting and retaining highly qualified candidates to 
fill critical skills and mission-essential positions.
    With respect to a number of ``acting'' positions, NNSA is moving as 
quickly as possible to recruit the best possible talent to fill these 
key executive positions. For example, NNSA just selected the new 
Associate Deputy Administrator for Fissile Materials Disposition, and 
is now close to filling several other ``acting'' executive positions at 
Headquarters.
    We have made major innovations and improvements in NNSA's human 
capital management programs the past 3 years. These innovations cover 
the Administrator's statutory excepted service technical hiring 
authority and a complementary pay-for-performance system; an NNSA-wide 
performance management and recognition system; a merit promotion plan; 
and various programs of monetary incentives relating to recruitment and 
retention, including a student loan repayment program. Last year, we 
developed and instituted a Future Leaders Program to hire and develop 
entry-level technical, project management, and business talent. The 
first class of 30 interns proved to be a success beyond our most 
optimistic expectations, and we have just completed recruitment of a 
second class of 30 talented interns. Just recently, we inaugurated an 
enterprise-wide workforce analysis and planning process to inventory 
our current skills profile and to better identify near- and long-term 
staffing trends and skill needs.
    With respect to addressing our selective and occasional staffing 
difficulties, we have streamlined our hiring processes, making greater 
use of automation, devising better marketing strategies and recruiting 
tools, and encouraging greater managerial involvement in candidate 
evaluation and selection. We are making maximum use of government-wide 
recruitment incentives, and exploring the use of OPM's competitive 
examination innovations, such as category-ranking procedures. 
Meanwhile, NNSA's excepted service employment and pay-for-performance 
system has allowed us to successfully compete with the private sector 
for many top technical workers, though not in every instance to be 
sure, as implied by your next question. And as NNSA has made full use 
of the Administrator's existing excepted service hiring and pay 
authorities, we are now considering alternative ways to build on and 
augment our previous successes.
    Question. How is the NNSA tapping into the skills at the national 
laboratories to address shortfalls?
    Answer. NNSA avails itself of the outstanding technical talent in 
our national laboratories in three primary ways, through IPA 
assignments, M&O contractor details, and consultant appointments. The 
IPA and M&O detail mechanisms are used to retain the services of 
current laboratory employees, and these mechanisms are used frequently 
to retain the services of top laboratory talent. For example, about 60 
laboratory employees are currently on M&O details to NNSA, the number 
of laboratory employees on detail to NNSA usually fluctuating between 
60 and 85 employees from month to month. There are four laboratory 
employees currently on IPAs to NNSA. Additionally, NNSA occasionally 
retains the services of retired laboratory employees through consultant 
appointments.
    Senior laboratory employees command salaries that generally exceed 
Federal pay levels, which tends to negate NNSA's ability to recruit 
laboratory employees to fill permanent Federal positions. On the other 
hand, use of the Administrator's excepted service hiring and pay 
authorities has recently bolstered NNSA's ability to attract top 
technical talent, not only from the laboratories, but also from 
industry and the universities.
    Question. Are Alternative Personnel Systems that provide incentives 
for specialized skills through performance-based pay being considered 
for potential implementation?
    Answer. There is no question that an agency's staffing and 
recruitment effectiveness can be improved through various appointment 
and pay features of an alternative personnel system. Toward that end, 
NNSA designed, developed, and implemented an alternative excepted 
service personnel system to implement the hiring and pay authorities 
granted to the Administrator by the NNSA Act. We have used the 
Administrator's entire statutory allocation of 300 scientific and 
engineering positions. In addition, we have made extensive use of large 
segments of the Department's two excepted service authorities and will 
continue to use the remaining Departmental excepted service 
authorities. We will also assess the need for potential additional 
authorities and develop detailed plans for consideration of the 
Congress in the appropriate out-year budget submissions.
    Question. Can you comment on the success of this new governance 
model and any lessons that you've learned in implementation?
    Answer. NNSA view is that this ``model'' contract has provided new 
tools that have been and will continue to be beneficial to both the 
Government and the contractor. We are performing oversight with fewer 
Federal employees and NNSA has seen improvement in Sandia's performance 
as a result of this new governance model.
    In the last 2 years, Sandia has developed and implemented a 
Contractor Assurance System throughout the laboratory including a 
corporate self-assessment program, corrective action and tracking 
program, corporate issues tracking program, benchmarking processes, and 
performance metrics for key laboratory operations. When combined these 
processes and systems allow both Sandia and NNSA to have greater 
insight into operational and program performance enabling them to be 
able to identify and correct problems at lower levels before they 
become systemic.
    We have also seen improvement in Sandia's capitalization on private 
sector experience. Sandia has now formalized a process to ensure that 
lessons learned are implemented. Sandia has sought and achieved 
certification against industry standards. An example is their ISO 9001 
procurement system certification. Sandia is currently in the process of 
seeking ISO 9001 certification of their Contractor Assurance System, 
which they call the Integrated Laboratory Management System. Sandia 
also completed a benchmarking study of their G&A by Hackett.
    The model contract has increased contractor accountability. The 
model contract features of Fixed Fee for the stockpile work, tied to 
the Award Term Incentive, and Incentive Fee are useful to the 
Government. We have learned that the award term (which Sandia did not 
earn for fiscal year 2005) is an extremely powerful tool to focus a 
contractor's attention. The model contract drives communication, 
efficiencies, and accountability better than the previous contract 
utilizing a fixed fee structure. We have noted increased involvement by 
the parent entity, Lockheed Martin and the Sandia Corporation's Board 
of Directors. The Board is very active with committees on CAS/ILMS or 
governance and Security and Safety which Sandia VPs report to 
routinely. The model is that once ILMS/CAS is up and running this form 
of governance will be relied on to change oversight.
    Finally, through this contract, NNSA has been able to realize cost 
savings which have been applied to Laboratory operations. Examples of 
completed projects include:
  --enhancing classified network ($2 million);
  --cleaning up beryllium contamination ($2 million);
  --Implementation of a new JTA development process with a projected 
        reduction of cycle time of 50 percent (6 years to 3 years); 
        and,
  --W80 Neutron Tube Development Welding Cell value stream mapping that 
        realized 96 percent reduction in cycle time.
    We have learned some valuable lessons in our first 2 years. The 
first is that it has been hard to redefine the contractor and 
Government relationship. Both sides had grown accustomed to having the 
Government telling the contractor not only the ``what'' but the ``how'' 
with old habits being difficult to change. Secondly, redefining the way 
in which the Government operates has not been easy for either party. 
When NNSA was established we eliminated the Operations Offices and 
redefined the roles and responsibilities of the Site Office and 
Headquarters. This change has been difficult but we are gaining 
momentum and there is evidence that we are being more thoughtful in our 
interactions and direction of the contractors. This new structure has 
also allowed the Site Offices to focus on improving operations at our 
facilities to include security and safety. Over the last 3 years at 
Sandia this has resulted in significant improvement in security 
operations and smaller improvements have been achieved in the safety 
arena. The NNSA Leadership Coalition, consisting of senior mangers from 
Headquarters, the Service Center, and Site Offices are working together 
and are speaking with one voice. This has resulted in NNSA providing 
more clear and concise direction.

                        LANL--NEW CONTRACT COSTS

    Question. Mr. D'Agostino, you were the selection officer for the 
Los Alamos contract award. You selected the Los Alamos National 
Security, LLC--a partnership between Bechtel, University of California, 
BWTX and Washington Group. These are all very well-qualified groups. 
However, this contract is much more expensive than the previous 
contract and I suspect you were attempting to attract the best talent 
with a much higher fee.
    This contract also requires the Lab to pay Gross Receipts Tax to 
the State ($75 million). I suspect there are several other cost 
increases that add to the bottom-line operations of the lab. 
Unfortunately, the budget doesn't reflect an increase to accommodate 
these added costs. All of these costs will come out of R&D budgets and 
lab operations that we appropriate.
    Do you know how much more it will cost to operate the new contract? 
What impact will this have on the programs?
    Answer. Under the new contract, NNSA could pay Los Alamos National 
Security, LLC (LANS) significantly more fee than it pays the University 
of California to manage the laboratory if LANS lives up to the 
performance incentives and contractor assurance initiatives LANS 
proposed in its winning proposal. In the first year, the difference 
could be in the neighborhood of $66 million and varies somewhat over 
the base term of the contract because LANS proposed a lesser fee in the 
out-years than in the first few years.
    LANS and the New Mexico Department of Revenue and Taxation have not 
finalized LANS payment schedule and procedures and, therefore, it is 
not possible to respond precisely with respect to the New Mexico Gross 
Receipts Tax. It will not be on the order of $75 million more than at 
present because the major for-profit subcontractors already pay gross 
receipts tax and your $75 million figure does not take that into 
account.
    In addition, there will be additional set-up expenditures to 
establish and maintain the pension plans and benefits arrangement for 
LANS, a private entity; they are, therefore, different than the system 
expenses associated with the pension and benefits provided by the 
University of California.
    NNSA expects minimal impact on program performance because of the 
factors enumerated in response to the next question.
    Question. Where will the new contractor find the funding to offset 
the increased costs without negatively impacting the program?
    Answer. Based on the LANS proposal, its multi-year strategy for 
continuous improvement and its plan for parent organization oversight 
and assistance, NNSA is confident that LANS will offset much of the new 
expense through savings realized through better, more disciplined and 
more streamlined operations. For example, through footprint reduction 
LANS is expected to reduce operation and maintenance costs. Through its 
integrated project teams, LANS is expected to reduce the cost of 
operating facilities. By improving procurement and financial management 
overall, LANS is expected to realize significant savings both in the 
actual business operation and in the program supported by that business 
operation.
    NNSA anticipates ``locking in'' the promises of better and more 
cost-effective performance through the objectives and measures in the 
annual performance evaluation plan against which LANS must perform to 
earn a significant portion of its fee.
    Question. Do you have sense as to which programs might be impacted? 
Will this impact jobs?
    Answer. NNSA does not know at present on which (if any) programs 
there may be an impact as a result of the changeover to LANS. We remain 
hopeful that there will be little to no impact on the deliverables NNSA 
needs within its mission requirements.
    There could be some impact on jobs, the extent of which is not 
certain at this time. This is because some current employees may choose 
to retire and not seek employment with LANS, may retire and will not be 
re-hired by LANS or may resign and seek employment elsewhere. NNSA does 
not expect this number to be significant given the ``substantially 
equivalent'' benefits and compensation offers NNSA directed to be 
placed in the transition.
    NNSA also believes that, over time, LANS' transformation of the 
laboratory could change the nature of some jobs currently performed at 
the laboratory as it develops science and programs to address the 
National Security needs of the future. It is not certain whether, or in 
which direction, it may affect the number of jobs at the laboratory as 
NNSA insists on a forward-looking and dynamic Los Alamos National Lab.
    Question. How much does the NNSA invest in developing technology 
that can be used as early warning detection, or as a security 
deterrent?
    Answer. In addition to the technologies that are deployed at each 
site with operational funds, the National Nuclear Security 
Administration spends $8.0 million per year on a program dedicated to 
security technology deployment. These technologies cover the entire 
range of security requirements, from early warning and detection to 
armor-piercing ammunition, and from new communications systems to 
Classified Removable Electronic Media accounting systems.
    Question. How effective has the NNSA been in the deployment of this 
technology and what can be done from a technology standpoint to reverse 
the growing trend line in security costs?
    Answer. The National Nuclear Security Administration is effective 
at deploying innovative security technologies. The trend line in 
security costs will be held down as much as possible with these 
technologies. But the return on investment is generally not immediately 
evident--it takes several years for a new technology to start reducing 
operational costs. In addition, the Design Basis Threat policy may 
continue to drive the overall trend line upwards, in spite of the 
savings from technology deployments.
    Question. Why have these processes taken so long? Do you lack 
confidence in the incumbent--who has been the subject of numerous 
critical reports by the IG?
    Answer. Proposals are currently being reviewed by the Source 
Evaluation Board to select a suitable candidate for the security 
contracts at Y-12 and the Nevada Test Site. Currently, the Y-12 
proposal is being reviewed by the Source Evaluation Board. The Nevada 
Test Site proposal has been sent back to the Source Evaluation Board 
for further analysis. The Federal Acquisition Regulation parts 3.104-3 
``Statutory and related prohibitions, restrictions, and requirements,'' 
and 3.104-4 ``Disclosure, protection, and marking of contractor bid or 
proposal information and source selection information,'' does not allow 
the Department to provide any specific information in relation to the 
selection of these contracts.
    Question. Is there insufficient competition? Are you uncertain of 
the security mission at these sites?
    Answer. Proposals are currently being reviewed by the Source 
Evaluation Board to select a suitable candidate for the security 
contracts at Y-12 and the Nevada Test Site. The Federal Acquisition 
Regulation parts 3.104-3 ``Statutory and related prohibitions, 
restrictions, and requirements,'' and 3.104-4 ``Disclosure, protection, 
and marking of contractor bid or proposal information and source 
selection information,'' does not allow the Department to provide any 
specific information in relation to the selection of these contracts.
    Question. Will you update me on measures taken to improve security 
performance at the site?
    Answer. The security posture at the Nevada Test Site has undergone 
a complete transformation. We have brought on board a highly qualified 
Federal security manager and nuclear security professionals to oversee 
the build-up of physical security measures at the site. The physical 
security and protective force upgrades being deployed are extensive and 
strong. Over the past year we have increased the size, training, and 
equipment of the protective force. These improvements include the 
procurement of additional armored vehicles and improved firepower in 
the form of heavy machine guns, grenade launchers, and armor piercing 
ammunition. To enhance our adversary detection capabilities we are 
installing state-of-the-art electronic surveillance and video 
assessment systems. A major element of our upgrade plan involves the 
fielding of a Special Response Team (SRT) capability whose training and 
equipment rival those of a major city SWAT team. The combined effect of 
these upgrades is significant, making the site one of the most heavily 
defended locations in the Nation. We will continue to closely monitor 
these upgrades and the performance of the protective forces at the 
Nevada Test Site.
    Question. Why should the public have confidence that change has 
occurred, given Admiral Mies' finding that DOE/NNSA's ability to ``to 
evaluate findings, assess underlying root causes, analyze alternative 
courses of action, formulate appropriate corrective action, gain 
approval, and effectively implement change'' is ``weak to non-
existent''?
    Answer. In the year-and-a-half since the Deputy Secretary referred 
to ``recent significant physical security performance problems at 
Nevada Test Site . . .'' significant progress has been made. To confirm 
this progress, the Administrator for the National Nuclear Security 
Administration requested the Department of Energy, Office of 
Independent Oversight, conduct a follow-up to its 2004 inspection. That 
follow-up was completed in September 2005, and the Office of 
Independent Oversight reported that ``performance has noticeably 
improved.'' Specifically, ``significant improvements over the past year 
include positive management initiatives, appropriate skills and 
training, robust protection at the Device Assembly Facility, and 
effective protection of classified matter.''
    Question. How much is the complex proposing to spend on physical 
security in 2007?
    Answer. The fiscal year 2007 Defense Nuclear Security budget is 
$665.7 million. Of this amount, $491.6 million is for ``physical 
security'' programs.
    Question. Is this security cost driven by the number of sites in 
the complex, or the number of facilities within each site, or the 
amount of SNM at each site?
    Answer. All three factors contribute to the level of security 
costs. At sites such as Pantex and Y-12 the size of the special nuclear 
material holdings and the geographic spread of the storage and 
processing facilities drives up the cost of security, as protective 
forces are needed to control large areas of the site. At the remaining 
National Nuclear Security Administration sites, we have been able to 
effect on-site consolidation that has significantly reduced the cost of 
protecting special nuclear material, the best example of this is the 
removal of Category I/II special nuclear material from Los Alamos 
National Lab's TA-18.
    Question. What are the annual security costs at Kansas City, LLNL, 
LANL, at Sandia Livermore and Sandia Albuquerque, at Savannah River, 
and at Y-12?
    Answer. Fiscal year 2007 Defense Nuclear Security allocations by 
site are:

                        [In millions of dollars]
------------------------------------------------------------------------
                                                              Amount
------------------------------------------------------------------------
Kansas City.............................................            11.3
Lawrence Livermore......................................            83.9
Los Alamos..............................................           113.7
Sandia..................................................            70.9
Savannah River..........................................            11.5
Y-12....................................................           132.1
------------------------------------------------------------------------

    Question. Would the security costs at any given site go down if 
they did not have SNM at that site?
    Answer. While each site is unique, the security costs for 
protecting special nuclear material ranges between 50 percent to 70 
percent of the site security budget. The National Nuclear Security 
Administration is aggressively pursuing further consolidation of 
special nuclear material, both as a means for reducing security costs, 
but also to reduce the overall risks posed by this material.

                  RUSSIAN HIGHLY ENRICHED URANIUM DEAL

    Question. If the Russian Suspension Agreement is modified or 
allowed to expire resulting in significantly increased amounts of 
Russian low enriched uranium entering the U.S. market:
  --1. It is expected to have a serious impact on the financing for the 
        $1.4 billion privately funded LES National Enrichment Facility 
        by creating a significant negative market impact from the 
        flooding of the United States with low enriched uranium;
  --2. The financial community will likely raise serious concerns 
        regarding the long-term viability of the LES project if they 
        feel the market would be impacted by the expiration of the 
        Russian Suspension Agreement;
  --3. A similar negative impact is expected on USEC's ability to build 
        and operate the American Centrifuge Facility; and
  --4. It could prevent the nuclear industry from having a domestic 
        source of enriched uranium if the LES and USEC facilities are 
        not built because of this negative market impact.
    Please provide the committee with the position of the NNSA on the 
impact the modification or expiration of the Russian Suspension 
Agreement resulting in the significant increase of Russian low enriched 
uranium entering the U.S. market will likely have on the ability to 
build and operate the new LES and USEC facilities and the impact on the 
future U.S. domestic enrichment industry of large amounts of Russian 
low enriched uranium entering the U.S. market.
    Answer. DOE/NNSA supports the deployment of advanced centrifuge 
uranium enrichment facilities in the United States--as was emphasized 
in a DOE letter of July 25, 2002, to the Nuclear Regulatory 
Commission--and believes that such facilities are needed for both 
energy security and national security purposes. The letter further 
stated that, ``The Department firmly believes that there is sufficient 
domestic demand to support multiple domestic enrichers and that 
competition is important to maintain a healthy industry.'' I am aware 
of no circumstance that has changed or diminished that statement and I 
believe it is as appropriate today as it was in 2002.
    Let me assure you that I share your concern on the fragility of the 
current U.S. uranium enrichment infrastructure, and the need to 
modernize and expand U.S. uranium enrichment capabilities. I recognize 
that the decisions by USEC to build the American Centrifuge Facility 
and by LES to build the National Enrichment Facility were based on 
market projections that included continuation of the Russian Suspension 
Agreement. It is clear that terminating or drastically modifying the 
Suspension Agreement at this critical time could undermine these 
ongoing plans to establish a modern, efficient and competitive uranium 
enrichment industry in the United States.
    Although NNSA is not a party of record in the Department of 
Commerce's Sunset Review of the Suspension Agreement, NNSA has made 
clear its support for continuing the Suspension Agreement in the 
Interagency. NNSA fully supports Commerce's Preliminary Results of the 
Sunset Review of the Suspension Agreement reported in the Federal 
Register on Monday, April 3, 2006, which find that revocation of the 
Suspension Agreement would likely lead to a recurrence of dumping.
    I would like to express my concern for the 1993 Highly Enriched 
Uranium Purchase Agreement (the HEU Agreement), which is eliminating 
500 metric tons of excess Russian HEU from dismantled Russian nuclear 
weapons by downblending it for use as fuel for U.S. power reactors. The 
Suspension Agreement has been the legal basis by which Russian low 
enriched uranium has entered the U.S. market duty free. Unilateral 
Russian termination of the Suspension Agreement would automatically 
trigger 115 percent antidumping duties on the HEU Agreement imports 
from Russia, immediately threatening the economic viability of the HEU 
Agreement, which supplies half of the nuclear fuel for U.S. power 
reactors. An interagency review is underway to address this concern; 
any proposed modification of the Suspension Agreement would require 
careful review.

                             STATUS OF MOX

    Question. I am surprised by the lack of detail in your statement 
regarding MOX. Your statement makes no mention of the fact that the 
Department is rebaselining the entire program and cost estimates have 
increased to over $3 billion. It makes no mention of the steps the 
Department is taking to respond to the DOE IG Report, which found the 
Department lacks sufficient contractor oversight, which has contributed 
to the increased costs.
    It also fails to mention that the Russians have made it clear that 
they will no longer pay for the operations of the MOX facility if they 
are limited to using the fuel in light water reactors, in the same 
manner as United States. Apparently the Russians have made unilateral 
decision that their only interest is in fast reactors.
    Finally, I am becoming increasingly frustrated that the Russians 
continue to stall the final approval of the liability agreement. I 
believe the Russians are now the biggest liability facing the program 
and we should sever the link between the construction projects.
    Since your statement fails to mention any of these issues can you 
please update the committee? What are you doing to improve the contract 
oversight and reign in the contractor?
    Answer. I share your frustration over the fact that the Russian 
Government has not yet signed the protocol covering liability 
protection for the plutonium disposition program. Despite continued 
delays, we have been assured repeatedly by officials from the Russian 
Ministry of Foreign Affairs and the Russian Atomic Energy Agency that 
there are no substantive problems with the language that was agreed to 
in July 2005, but rather it is a question of the protocol undergoing a 
complete Russian interagency review that has been moving more slowly 
than expected. We continue to believe that the protocol will be signed 
shortly.
    The Russian Government has repeatedly stated that it remains 
committed to the 2000 U.S.-Russian Plutonium Management and Disposition 
Agreement, which obligates both countries to dispose of their plutonium 
by using it as mixed oxide (MOX) fuel in nuclear reactors. The 
agreement states that any nuclear reactor agreed to by both parties may 
be used for disposition. While Russian Government officials recently 
reaffirmed its willingness to proceed with plutonium disposition in 
light water reactors if the international community would provide full 
funding for the program, they also expressed their desire to explore 
the use of advanced reactors. In this regard, they agreed to begin 
early disposition of limited quantities of plutonium in Russia's 
existing fast reactor well before the United States could begin 
disposition of its plutonium, demonstrating their commitment to dispose 
of their surplus plutonium.
    As a result, we are moving forward with construction of the U.S. 
MOX facility at the Savannah River Site this year. To prepare for this 
effort, we have already taken a number of steps to improve the 
management of the MOX facility project. These include incorporating 
performance incentives in future contract negotiations, improving 
monthly project reports, controlling contractor spending, and reviewing 
contractor performance. Now that the planned date for the start of 
construction of the MOX facility has been set, the project cost and 
schedule baseline is currently undergoing an independent review and 
validation prior to the start of construction. This will enable us to 
track project performance against the baseline and minimize the 
possibility of future cost overruns. Plans are also underway to hire a 
qualified MOX Federal Project Director and to streamline the 
organizational structure of the project.

                          RADIOACTIVE SOURCES

    Question. What is NNSA doing to ensure that both domestic and 
foreign radioactive materials are not used in a malicious manner 
against the United States?
    Answer. NNSA's Office of Global Radiological Threat Reduction works 
in both the United States and overseas to secure, consolidate and/or 
remove high powered (i.e., suitable for use in an effective 
radiological dispersal device (RDD)) and vulnerable radioactive 
materials.
    The U.S. Radiological Threat Reduction (USRTR) program, also known 
as the Off-Site Source Recovery Program, has recovered over 12,000 
excess and unwanted sources in the United States, containing over 
160,000 curies of radioactivity. In addition, the USRTR program is 
beginning a Source Security Program, which provides security 
assessments of facilities, as well as training for users of high-risk 
sources.
    The International Radiological Threat Reduction (IRTR) program 
works in over 40 countries with international and regional 
organizations to secure radioactive materials, transfer detection 
equipment, train regulators and police, and support international 
conferences and training for foreign government officials on best 
practices for security of radiological sources.
    Question. Your agency, DHS, NRC and other agencies are involved to 
some extent in the security of high-risk radioactive materials that 
could be used for RDDs. Should there be one lead agency which takes 
overall coordinating responsibility for ensuring that radioactive 
materials are not used maliciously?
    Answer. On December 13, 2003, the President issued Homeland 
Security Presidential Directive 7. Item 29 of this directive states 
that the Secretary of Homeland Security will continue to work with the 
Nuclear Regulatory Commission and, as appropriate, the Department of 
Energy, to ensure the necessary protection of nuclear (including 
radiological) materials in medical, industrial, and academic settings 
and facilities that fabricate nuclear fuel and the transportation, 
storage, and disposal of nuclear materials and waste.
    Question. What has been NNSA's budget allocation for both domestic 
and international programs for the past 3 years to address the RDD 
issues? Do you feel that NNSA has adequate, dedicated resources to 
address these issues?
    Answer.

----------------------------------------------------------------------------------------------------------------
                                                                    Fiscal Year     Fiscal Year     Fiscal Year
          Global Radiological Threat Reduction Program                 2004            2005            2006
----------------------------------------------------------------------------------------------------------------
International RTR...............................................         $27,000         $24,800         $24,078
U.S. RTR........................................................           5,400           7,540          12,750
----------------------------------------------------------------------------------------------------------------

    Funding over the past 3 years has permitted the Office of Global 
Radiological Threat Reduction to accelerate recoveries of orphaned 
sources in the United States and expand our international program 
beyond Russia and the Former Soviet Republics.
    Question. What measures has NNSA taken to mitigate the consequences 
of an RDD attack and to respond to such an attack if one should occur?
    Answer. The core focus areas of the Office of Global Radiological 
Threat Reduction are: (1) improving radioactive material security at 
the ``first line of defense'', i.e., the facilities where sources 
currently reside, beyond our borders; and (2) recovering disused 
sources in the United States, so as to mitigate RDD use in an attack. 
Additionally, the program works in concert with NRC and DHS 
domestically to address security of in-use sources.
    Question. What is the relative priority you would assign to taking 
measures to ensure that an RDD attack does not occur against the United 
States?
    Answer. Reducing the threat of a radiological dispersal device 
attack is a high priority for NNSA, DOE, and the Bush administration. 
This administration has done more than any other to secure radiological 
materials against their possible use by terrorists in a radiological 
dispersal device (RDD or ``dirty bomb''). The 2003 International 
Conference on Security of Radioactive Sources highlighted the need for 
radioactive source security and DOE/NNSA's Office of Global 
Radiological Threat Reduction is a response to that need. However, the 
threat posed by weapons-useable nuclear materials in an improvised 
nuclear device is considered a higher priority than the RDD threat 
because of the dramatically greater consequences associated with a 
nuclear explosion. This does not negate the severity of the RDD threat, 
which remains a high priority for DOE/NNSA.
    Question. Given the severe social, economic and psychological 
consequences of an RDD and the greater likelihood for an RDD attack to 
occur over an attack with a nuclear explosive, what can be done to 
accelerate NNSA's efforts to protect against an RDD attack?
    Answer. The Office of Global Radiological Threat Reduction has 
qualified and dedicated Federal and national laboratory resources 
working both overseas and in the United States to address the RDD 
threat. We have established and are exercising our interagency and 
international liaisons to share best practices and the ``security 
perspective'' domestically and internationally. Current and out-year 
funding will support commitments made in over 40 established project 
countries and the United States.
    Question. In light of the mass evacuation, property damage and 
severe economic burden resulting from Hurricanes Rita and Katrina, how 
would you compare such natural disasters to an RDD attack?
    Answer. Comparing the effects of a natural disaster and those of an 
RDD attack is difficult. Just as it is difficult to predict the damage 
resulting from a natural disaster, it is equally difficult to predict 
the relative strength and dispersal patterns of an RDD attack. Some 
types of damage are likely to be similar: displaced populations, 
economic losses, environmental damage, social panic and possible 
societal breakdown. Damage from an RDD attack, however, could adversely 
impact one additional element--denial of property. Denial of property 
would last until an area could be decontaminated, potentially a 
technically and financially demanding task. Additionally, the health 
effects of an RDD attack could include substantial increases in long-
term cancer rates. Finally, the psychological impact and widespread 
fear resulting from a radiation attack can is difficult to estimate.
    Question. How do other countries perceive the consequences of an 
RDD? Should we be building more effective partnerships with these 
countries such that they take an active role to ensure that an RDD 
attack does not occur?
    Answer. The threat posed by the use of a radiological dispersal 
devise (RDD) has only recently come to the attention of the 
international community. The international community, led by the United 
States, our G-8 partners, and international organizations such as the 
IAEA, has convened three international conferences to address the 
safety and security of radioactive materials around the world. 
Fostering and maintaining partnerships with other countries is 
essential due to the widespread use of radiological materials in 
applications ranging from agriculture to oil exploration. The 
International Radiological Threat Reduction (IRTR) program has 
developed Regional Radiological Security Partnerships in Southeast Asia 
(in sponsorship with Australia) and South America and is fostering 
burgeoning relationships in Africa to address the security of 
radioactive materials in those regions.
    Question. What can be done to get other countries to allocate their 
resources to address the RDD problem?
    Answer. Recent international conferences have highlighted the issue 
of the security of radioactive materials and are key to convincing 
other countries to allocate resources to address the RDD threat. 
Additionally, the International Radiological Threat Reduction (IRTR) 
program has developed Regional Radiological Security Partnerships to 
address the security of radioactive materials worldwide. A notable 
success has been our Regional Radiological Security Partnerships that 
was developed in Southeast Asia in sponsorship with Australia. This 
partnership supports NNSA and IAEA objectives to improve the security 
of high-risk radioactive materials. Australia has committed monetary 
resources for this cooperative threat reduction effort. Furthermore, as 
an integral part of our bilateral cooperative projects, the IRTR 
program addresses sustainability of the security systems it provides 
and works with countries to ensure that security costs are integrated 
into operating budgets.
    Question. What is NNSA doing to enlist support from other 
international organizations, such as the IAEA and Europol, to address 
the RDD problem?
    Answer. Although NNSA has no interactions with Europol, we have 
developed strong cooperative relationships with both the IAEA and the 
International Criminal Police Organization (Interpol) to address the 
RDD problem.
    NNSA's International Radiological Threat Reduction (IRTR) program 
has been engaged in cooperative projects to prevent radiological 
terrorism with Interpol since 2003. This cooperation includes assisting 
Interpol to develop analytical reports that characterize the nature of 
thefts and diversions of radioactive materials, and equipping and 
training front line police officers to enable them to detect and 
mitigate radiological security threats. This training allows these 
officers to remain competent in the use of this equipment over an 
extended period of time.
    The IRTR program cooperates extremely well with the IAEA ranging 
from multinational conferences to in-country support on topics ranging 
from regulatory support to physical protection. The Office of Global 
Radiological Threat Reduction continues to provide the IAEA's Nuclear 
Security Fund significant donor support through extra-budgetary 
contributions. To date, GRTR has contributed approximately $11 million 
for our joint activities.
    Question. I am aware that NNSA has worked in over 40 countries to 
help ensure that their high-risk radioactive sources are secure. What 
is being done to ensure that these security measures will remain in use 
and effective for a period well beyond the length of the assistance 
that NNSA is providing?
    Answer. It is critical to ensure the continued operation and 
maintenance of security systems and procedures after the work of the 
Office of Global Radiological Threat Reduction is complete. One major 
aspect of our project planning and execution overseas is developing a 
sustainable physical protection system and incorporating security into 
host country practices and foreign facility operational budgets. 
Designing an effective and sustainable security system requires working 
directly with national regulators and site personnel to make sure they 
understand and evaluate the full gamut of operational considerations 
that result from the installation of a physical security system.

              LABORATORY DIRECTED RESEARCH AND DEVELOPMENT

    Question. What does the budget propose in for the LDRD account?
    Answer. Although LDRD levels are not proposed specifically in the 
annual budget requests, the NNSA supports continuing funding for the 
LDRD programs at its National Laboratories.
    In accordance with guidance in the Conference Report to accompany 
the Energy and Water Development Appropriations Act, 2006, (H. Rept. 
No. 109-275 (2005)), and departmental policy, NNSA required its 
Laboratories to modify cost accounting procedures and apply overhead 
charges to the LDRD program. Implementing these changes while 
sustaining the historical funding levels for LDRD requires a funding 
rate of up to 8 percent. Our objective is to sustain the funding that 
is applied directly to scientific and technical work so the changes 
described above should not decrease the effective level of research 
conducted under the LDRD program or increase the cost of DOE programs 
or work for non-DOE customers.
    The NNSA continues to believe the recommendations of the Packard 
Commission and Galvin Commission that a robust LDRD program is 
essential to the scientific and technical vitality of the National 
Laboratories and their long-term contributions to national security.

              LABORATORY DIRECTED RESEARCH AND DEVELOPMENT

    Question. Does the budget contemplate any reforms to this program?
    Answer. The NNSA and the National Laboratories have implemented the 
changes required to apply all Laboratory overhead charges to the LDRD 
program in fiscal year 2006. There is no specific initiative under way 
that would result in further changes to the LDRD program to be 
implemented in the near future. The NNSA and its National Laboratories 
regularly review the LDRD program, how it operates, and the science and 
technology it produces, to improve the program and its value to the 
Nation. If this process identifies beneficial reforms within the 
current constraints for the LDRD program, then the NNSA would work with 
the Laboratories to implement them.

                         CONCLUSION OF HEARINGS

    Senator Domenici. We stand recessed until the Chair calls 
another meeting.
    [Whereupon, at 3:08 p.m., Thursday, April 6, the hearings 
were concluded, and the subcommittee was recessed, to reconvene 
subject to the call of the Chair.]
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