[Senate Hearing 111-185]
[From the U.S. Government Publishing Office]



                                                        S. Hrg. 111-185
 
               ENVIRONMENTAL MANAGEMENT STIMULUS FUNDING

=======================================================================

                                HEARING

                               before the

                    SUBCOMMITTEE ON STRATEGIC FORCES

                                 of the

                      COMMITTEE ON ARMED SERVICES
                          UNITED STATES SENATE

                     ONE HUNDRED ELEVENTH CONGRESS

                             FIRST SESSION

                               __________

                             APRIL 22, 2009

                               __________

         Printed for the use of the Committee on Armed Services



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                      COMMITTEE ON ARMED SERVICES

                     CARL LEVIN, Michigan, Chairman

EDWARD M. KENNEDY, Massachusetts     JOHN McCAIN, Arizona
ROBERT C. BYRD, West Virginia        JAMES M. INHOFE, Oklahoma
JOSEPH I. LIEBERMAN, Connecticut     JEFF SESSIONS, Alabama
JACK REED, Rhode Island              SAXBY CHAMBLISS, Georgia
DANIEL K. AKAKA, Hawaii              LINDSEY GRAHAM, South Carolina
BILL NELSON, Florida                 JOHN THUNE, South Dakota
E. BENJAMIN NELSON, Nebraska         MEL MARTINEZ, Florida
EVAN BAYH, Indiana                   ROGER F. WICKER, Mississippi
JIM WEBB, Virginia                   RICHARD BURR, North Carolina
CLAIRE McCASKILL, Missouri           DAVID VITTER, Louisiana
MARK UDALL, Colorado                 SUSAN M. COLLINS, Maine
KAY R. HAGAN, North Carolina
MARK BEGICH, Alaska
ROLAND W. BURRIS, Illinois

                   Richard D. DeBobes, Staff Director

               Joseph W. Bowab, Republican Staff Director

                                 ______

                    Subcommittee on Strategic Forces

                     BILL NELSON, Florida, Chairman

ROBERT C. BYRD, West Virginia        JEFF SESSIONS, Alabama
JACK REED, Rhode Island              JAMES M. INHOFE, Oklahoma
E. BENJAMIN NELSON, Nebraska         LINDSEY GRAHAM, South Carolina
MARK UDALL, Colorado                 DAVID VITTER, Louisiana
MARK BEGICH, Alaska

                                  (ii)

  
?



                            C O N T E N T S

                               __________

                    CHRONOLOGICAL LIST OF WITNESSES

               Environmental Management Stiumulus Funding

                             april 22, 2009

                                                                   Page

Triay, Dr. Ines R., Acting Assistant Secretary for Environmental 
  Management, Eepartment of Energy...............................     4

                                 (iii)


               ENVIRONMENTAL MANAGEMENT STIMULUS FUNDING

                              ----------                              


                       WEDNESDAY, APRIL 22, 2009

                               U.S. Senate,
                  Subcommittee on Strategic Forces,
                               Committee on Armed Services,
                                                    Washington, DC.
    The subcommittee met, pursuant to notice, at 9:33 a.m., in 
room SR-222, Russell Senate Office Building, Senator Bill 
Nelson (chairman of the subcommittee) presiding.
    Committee members present: Senators Bill Nelson, Begich, 
Sessions, and Graham.
    Committee staff member present: Jennifer L. Stoker, 
security clerk.
    Majority staff member present: Madelyn R. Creedon, counsel.
    Minority staff member present: Daniel A. Lerner, 
professional staff member.
    Staff assistant present: Kevin A. Cronin.
    Committee members' assistants present: Christopher Caple, 
assistant to Senator Bill Nelson; Lenwood Landrum and Sandra 
Luff, assistants to Senator Sessions; and Matthew R. Rimkunas, 
assistant to Senator Graham.

       OPENING STATEMENT OF SENATOR BILL NELSON, CHAIRMAN

    Senator Bill Nelson. Good morning and welcome to our 
hearing in the Strategic Forces Subcommittee.
    Our witness is Dr. Ines Triay, the acting Assistant 
Secretary of Energy for Environmental Management (EM). Dr. 
Triay is responsible for Energy's efforts to clean up the vast 
quantities of radioactive and other contamination generated 
during the Cold War.
    Under the stimulus bill, the American Recovery and 
Reinvestment Act of 2009, the Department of Energy (DOE) 
received $5.1 billion to address a substantial backlog of these 
cleanup projects, and it hopefully will meet the various 
legally binding commitments to the States and the Environmental 
Protection Agency (EPA) and accelerate the cleanup activities, 
where it is possible. In the long run, this accelerated cleanup 
ought to save money by reducing the number of sites and the 
facilities that have to be maintained.
    The funding under the stimulus bill for the EM Program is 
similar to the annual appropriation for fiscal year 2009, which 
is approximately $6 billion. Although the EM Program has been 
underfunded in the last several years, receiving the equivalent 
of a full year's appropriation is a very large amount for a 
single program to absorb and to manage. So, under the 
requirement of section 1603 of the stimulus bill, the funds 
have to be obligated by September 30, 2010.
    Because the EM Program has been underfunded in the past 
several years, the National Defense Authorization Bill from 
last year, which is this present year, fiscal year 2009, 
authorized an additional $500 million to address the shortfall 
in 2009. Additional money is needed in this program, and the 
hearing today is to ensure that these extra funds and extra 
projects will be managed to ensure that the taxpayers are 
receiving good value for their money.
    Dr. Triay, we look forward to hearing from you about how 
we're going to meet the goals that the stimulus bill laid out, 
what projects are going to be funded, how the projects will be 
managed, and the timetable for project execution.
    Senator Sessions.

               STATEMENT OF SENATOR JEFF SESSIONS

    Senator Sessions. Thank you, Mr. Chairman, and thank you, 
Dr. Triay. We appreciate your service. You certainly are 
challenged, and very few people have any idea how significant a 
financial commitment this Nation is being asked to make with 
regard to this cleanup. It's just stunning, breathtaking beyond 
most anything anybody could imagine.
    It will provide no real benefits, such as investing $100 
billion in the Department of Defense (DOD) or energy efficiency 
or productivity. It's mainly clean up a spill and an 
environmental hazard that has occurred, and so it's not a real 
benefit to us. I think--of course it's a benefit in cleaning 
up, but I'm talking about the economy and the productivity of 
the Nation is not much enhanced by this effort.
    So, I guess my fundamental concern is the cost. I raised 
that several years ago at some length in this committee, and 
remain baffled by the amount of money that we're investing 
here.
    As the chairman indicated, in addition to your $6 billion 
base budget, the stimulus bill added another $6 billion. That 
is a huge amount of money. It's difficult for me to imagine how 
it could be spent effectively in the short timeframe it's been 
suggested it would be spent. So, you're challenged, no doubt.
    The bipartisan Congressional Budget Office reports that 
only 40 percent of the emergency management recovery funding 
can be spent by the end of fiscal year 2010, which I'm sure is 
true. You would just be throwing money away, probably, to try 
to spend it faster than that, and I'd be interested as to 
whether or not you can carry the money over, even though it was 
supposed to be stimulus, in the 2 year timeframe. But, we can't 
just waste that money. It has to be productively utilized, and 
I hope that you'll have that flexibility.
    Dr. Triay, in this committee, several years ago, maybe 3--I 
think I was chairman then, or maybe just--Senator Nelson had 
just taken over--the DOE official came in and blithely told us 
that there had been an error in the computation of how much 
this cleanup cost would be, nationwide, and it wasn't going to 
be $100 or $120 billion, I think, it was going to be $180 
billion. I remember declaring in amazement that that had to be 
the largest cost overrun in the history of the Republic. 
Nothing had ever been seen like an $80 billion cost overrun 
before.
    Now I'm hearing that that's low, still. According to the 
2009 report to Congress, the estimated total outstanding cost 
to complete cleanup at all of the remaining facilities, at this 
highest, pristine standard that we're talking about, range 
between $205 billion and $260 billion. History being what it 
is, it probably will exceed $260 billion unless we can figure 
out a way to confront this problem.
    You have a tremendous challenge. I don't know how you can 
do it, but I encourage you to stand up for the American 
taxpayer. I remember, at that committee meeting, Senator 
Lindsey Graham from South Carolina talked about how they were 
able to speed up the Savannah River Site cleanup by 23 years 
and save the taxpayers $16 billion.
    So, my question and my concern is, we have to be realistic. 
How much good could we do, Mr. Chairman, with $100 billion, 
$150 billion, if we could figure out a way to do some of the 
things they did at Savannah River in South Carolina, and 
improve that cleanup, get the job done quicker, and do it at a 
cost that is going to be exceedingly high, by any standards, 
but more realistic?
    So, I'm not against cleaning up. I'm not against the 
Senators and Congressmen who want to see everything possible 
done in their States, but you're in a difficult spot, and we're 
in a difficult spot. We have to protect the treasury of the 
United States, and we have to ask, are there some alternatives 
that we can utilize, as in South Carolina, that can get the job 
done effectively, quicker, and at less cost?
    Thank you.
    [The prepared statement of Senator Sessions follwos:]

              Prepared Statement by Senator Jeff Sessions

    Thank you very much, Mr. Chairman. I join you in welcoming our 
witness, Dr. Ines R. Triay, the acting Assistant Secretary for 
Environmental Management at the Department of Energy (DOE).
    Dr. Triay, the Office of Environmental Management (EM) has an 
important mission. Defense-related nuclear activities during the Cold 
War led to significant volumes of nuclear waste, materials, and 
facilities. It is the responsibility of the Office of EM to complete 
the safe cleanup of contaminated DOE labs and production facilities.
    When Congress considered the stimulus bill earlier this year, there 
was broad agreement that a targeted, effective, and fiscally 
responsible economic recovery package was needed. However, by the time 
the bill reached the President's desk, it quickly became anything but 
targeted, effective, or fiscally responsible. Including billions in 
wasteful spending on permanent government programs, the final bill, at 
a staggering $1.2 trillion, is the largest single expenditure in our 
Nation's history. Every penny of which will have to be borrowed and 
repaid, with interest, by future generations.
    The purpose of this morning's hearing is to assess EM and its plan 
for obligating and spending its recovery act funding. As you are 
already aware, the legislation was especially generous to defense-
related environmental cleanup. In addition to its nearly $6 billion 
regular fiscal year 2009 appropriation, EM received an additional $6 
billion to help invigorate the economy and provide new jobs. I have a 
number of significant concerns and look forward to a constructive 
discussion regarding among others the overall funding level, and the 
speed at which EM will be able to allocate such a large infusion of 
funds in a stimulative way.
    Given reports by the bipartisan Congressional Budget Office (CBO) 
that only 40 percent of EM's recovery funding can be spent by the end 
of fiscal year 2010, I am especially troubled by the excessive level of 
this appropriation. Furthermore, CBO estimates it will take EM until 
the end of fiscal year 2012 to spend the entire $6 billion, hardly the 
immediate effect, many of the legislation's proponents advocated for.
    As noted in your 2009 report to Congress, the estimated total 
outstanding costs to complete cleanup at all of the remaining 
facilities could range between $205.43 billion and $260.53 billion. The 
last facility, Hanford, in the State of Washington, may not be cleaned 
up until as late as 2062. I remain very concerned with these escalating 
costs and schedules.
    To place this figure in context, the total general, education, and 
other funds that represent the total budget for the State of Alabama 
for fiscal year 2008 was $22.7 billion--that represents 8.7 percent of 
the $260.5 billion of the estimated costs to complete the cleanup. I 
just do not see how we can sustain this level of spending. That said, I 
am very interested in hearing your views regarding what procedures you 
will put in place and how you will ensure we contain, and more 
importantly reverse, this cost and schedule growth.
    A few years ago when this subcommittee met on the same issue of 
environmental cleanup, I recall a discussion on how Senator Graham and 
the people of South Carolina were able to speed cleanup at the Savannah 
River Site by 23 years and save taxpayers $16 billion. Section 3116 of 
the 2005 DOD Authorization Bill illustrates there are in fact vehicles 
and legislative options for reducing both cost and schedule. What is EM 
doing to address the ever-increasing growth in cost of cleanup and what 
can Congress and the executive branch do to make sure that we get the 
job done without spending such large sums of taxpayer dollars?
    Finally, in light of some recent management and performance issues, 
look forward to hearing how EM plans to avoid cost overruns and 
significant delays like those at the Hanford Waste Management Treatment 
Plant, a project to solidify approximately 54 million gallons of 
radioactive waste, that has increased in cost from $6 billion to $12 
billion and been delayed by at least 8 years.
    Dr. Triay, as you can see I have a number of concerns. Nonetheless, 
look forward to having a constructive conversation this morning and am 
eager to hear how under your leadership EM will execute this funding in 
an expedited, fiscally responsible, transparent, and stimulative way.

    Senator Bill Nelson. Okay. Let's just start right there. 
Dr. Triay, who, by the way--you have good blood in you; you 
were educated in the State of Florida. [Laughter.]
    We will, of course, put your lengthy statement in the 
record, and Senator Sessions and I are just going to start off 
with questions.
    [The prepared statement of Dr. Triay follows:]

                  Prepared Statement by Dr. Ines Triay

    Good morning, Chairman Nelson and members of the subcommittee. I am 
pleased to be here today to answer your questions on the integration of 
American Recovery and Reinvestment Act of 2009 (Recovery Act) funding 
within the Department of Energy's Office of Environmental Management 
(EM) program.
    As you are aware, in January 2009, the Department completed and 
presented to Congress a comprehensive report assessing initiatives to 
accelerate the reduction of environmental risks and challenges posed by 
the legacy of the Cold War. The report, ``Status of Environmental 
Management Initiatives to Accelerate the Reduction of Environmental 
Risks and Challenges Posed by the Legacy of the Cold War,'' was 
prepared pursuant to section 3130 of the National Defense Authorization 
Act for Fiscal Year 2008 and summarizes EM's initiatives to accelerate 
risk reduction.
    The report submitted to Congress also outlined one of EM's key 
strategic planning initiatives: to reduce the legacy footprint of the 
EM complex. Footprint reduction is accomplished by focusing cleanup 
activities on decontamination and demolition of excess contaminated 
facilities, soil and groundwater remediation, and solid waste 
disposition, all of which have proven technologies and an established 
regulatory framework. Within this rubric, EM has demonstrated that 
additional investments in the program could yield significant 
environmental cleanup progress and create jobs quickly.
    Because of its strategic planning efforts over the last 18 months, 
EM was positioned to quickly leverage additional investments in 
footprint reduction activities to help achieve national economic and 
environmental objectives of both the Recovery Act and the EM program.

                    RECOVERY ACT AND EM BASE PROGRAM

    EM's plan is to allocate the $6 billion of Recovery Act funding 
provided by Congress to support footprint reduction and near-term 
completion cleanup activities. Given the economic climate over the past 
several years, footprint reduction cleanup activities have often been 
deferred in order to fund higher-risk activities.
    At the same time, EM will remain focused on the highest risk 
activities in EM's portfolio, including the management of radioactive 
tank waste, surplus special nuclear materials (SNM), and spent nuclear 
fuel (SNF) and essential activities required to maintain a safe and 
secure posture in the EM complex. These activities comprise the 
majority of base program funding and represent the biggest challenges 
facing the EM program. EM continues to move forward and clear hurdles 
in finalizing design, constructing, and operating of three unique and 
complex tank waste processing plants to treat approximately 88 million 
gallons of radioactive tank waste for ultimate disposal. With a total 
cost estimate of $14.3 billion, investments are still needed to 
complete building and operating these necessary facilities and process 
the tank waste, which is one of the primary risk and cost drivers in 
the program. EM also faces the challenge of selecting and implementing 
disposition options needed to prepare certain types of SNM and SNF for 
ultimate disposal. These higher risk activities will continue to 
comprise a large portion of EM's annual budget request.

                   RECOVERY ACT FUNDING AND OVERSIGHT

    Since much of the Recovery Act cleanup work is associated with 
compliance milestones, EM will be better positioned to meet its 
compliance commitments going forward. This work will be accomplished 
primarily through existing contract vehicles and will create thousands 
of new jobs that require limited training.
    EM is well poised to effectively spend the $6 billion in Recovery 
Act funding because this type of cleanup is associated with:

         Proven technologies--on-the-shelf plans and projects 
        ready to be implemented
         Regulatory infrastructure in place--established 
        regulatory framework with regulator and community support
         Acquisition structure in place--flexible contract 
        vehicles allow quick expansion of environmental cleanup 
        workforces
         Project Management structure in place--ability to 
        track and measure performance

    EM has identified opportunities at 17 sites in 12 States that meet 
these Recovery Act principles. EM must be able to fully account for and 
communicate the accomplishments achieved with Recovery Act funding and 
assure that Recovery Act work scope is integrated with ongoing EM 
budgeting and planning activities to ensure seamless integration of 
Recovery Act work within existing baseline work.
    As a result, EM will segregate cleanup scope funded within the 
normal appropriation process from work funded from the Recovery Act for 
both budget execution and project performance tracking and reporting. 
EM will be able to clearly articulate between existing programmatic 
performance (base program) and the additional cleanup progress that is 
achieved as a result of the additional resources invested in the 
program. This will provide a basis to continue the optimization of 
planning scenarios that can support future funding allocation 
decisions.
    EM has chartered an integrated project team (IPT), the EM Recovery 
Act Team, to ensure proper planning and execution of Recovery Act 
funds. The IPT is led by the Chief Project Manager (CPM) who is the 
senior-most Federal official within the project chain of command and 
who has ultimate responsibility and accountability for delivering the 
project successfully. The CPM is a member of the Federal Senior 
Executive Service and possesses the executive core competencies 
required to lead the project through this period of government 
transformation. The CPM is supported by Federal Project Directors (FPD) 
who have satisfied the certification requirements prescribed in the 
Department's Project Management Career Development Program (PMCDP), and 
have been certified by the PMCDP Certification Review Board. The FPDs 
are senior Federal managers and are seasoned project directors 
certified by the PMCDP Certification Review Board at FPD Levels 3 and 
4. The IPT members are experts in the areas of safety/operational 
readiness, planning, project management, budget, contracting, 
regulatory compliance, and communications. The team is actively engaged 
with the field office sites in all elements of Recovery Act 
implementation.
    EM is in the process of assigning Recovery Act Site Representatives 
to support the field offices. These individuals will streamline 
communications and decision-making between Headquarters and the field 
sites, while facilitating the integration, rapid sharing of lessons 
learned, and compliance with Recovery Act requirements.
    As a prerequisite to receiving Recovery Act funds, the site offices 
have been required to submit to Headquarters checklist items that 
ensure each site is in a state of readiness and has implemented 
measures that prevent waste, fraud, and abuse. The checklist items 
verify that each site office has the necessary systems and processes in 
place for safety, oversight, contracting, change control, reporting, 
risk management, and regulator and stakeholder involvement.
    The Recovery Act team will maintain a project management discipline 
in accordance with DOE Order 413.3A, through the use of clear 
performance measures, project and cost reviews, frequent rigorous 
reporting, utilization of the Earned Value Management System, and Risk 
Management Plans. The Recovery Act team is in close coordination with 
the Department's Office of Engineering and Construction Management to 
ensure full compliance with project management orders and policies.
    Approximately 90 percent of the Recovery Act work scope can be 
accommodated using modifications of existing prime contracts. 
Additionally, subcontracting is expected, as well as the continued 
implementation of small business contracts. Where appropriate, EM will 
utilize the Indefinite Delivery Indefinite Quantity (IDIQ) contract 
mechanism. IDIQ contract mechanism streamlines the contract process and 
provides for an indefinite quantity of supplies or services during a 
fixed period of time. Contract actions are being supported by the EM 
Consolidated Business Center and the Army Corps of Engineers for 
independent cost estimating.
    Safety is of the utmost importance to EM. Recovery Act activities 
will be executed in full compliance with all of the Department's safety 
requirements including the Integrated Safety Management System and 
Nuclear Safety Management, 10 CFR 830. Site offices have developed 
Federal Resource Oversight Plans, Contractor Readiness Self-Assessment 
Plans, and Vulnerability Assessment and Risk Mitigation Plans. Safety 
will also be a primary focus in the ongoing site readiness evaluations 
being implemented to assess the overall project, financial, technical, 
safety, and administrative readiness.
    EM endeavored to select Recovery Act projects that had an 
established regulatory framework. EM Headquarters and site-level 
managers will continue to work with State and Federal regulators, 
Congress, tribal nations, union officials, and all other stakeholders 
on Recovery Act planning and implementation process. The EM Recovery 
Act Team has also created a public website dedicated to the Recovery 
Act, and we are providing planning and implementation documentation to 
the Department's Inspector General as requested.

            RECOVERY ACT FUNDING ACROSS THE CLEANUP COMPLEX

Washington (Total funding $1.961 billion)
    Richland Operations Office ($1.635 billion)
    Demolish nuclear facilities and support facilities, remediate waste 
sites, remediate contaminated groundwater, and retrieve solid waste 
from burial grounds. Recovery Act funds will utilize the River Corridor 
cleanup contract to accelerate cleanup of facilities, waste sites, and 
groundwater along the Columbia River to support shrinking the active 
area of cleanup at the 586-square-mile Hanford Site to 75 square miles 
or less by 2015.
    Office of River Protection ($326 million)
    Upgrade the infrastructure and systems to transfer radioactive 
liquid waste from aging underground tanks to a waste treatment facility 
for immobilization and disposal to meet the 2019 startup date.
South Carolina (Total funding $1.615 billion)
    Savannah River Site ($1.615 billion)
    Accelerate decommissioning of nuclear facilities and contaminated 
areas throughout the site, including in-place decommissioning of two 
nuclear materials production reactors. Recovery Act work includes 
shipping more than 4,500 cubic meters of waste out of South Carolina 
and will reduce the site's industrial area by 40 percent, or 79,000 
acres, by September 2011.
Tennessee (Total funding $755 million)
    Oak Ridge ($755 million)
    At the East Tennessee Technology Park, Oak Ridge National 
Laboratory, and Y-12 sites, accelerate demolition and disposal of 
remaining uranium enrichment plant buildings, surplus Manhattan Project 
era buildings, and highly contaminated uranium processing buildings, 
and perform soil remediation to protect area groundwater. For instance, 
Recovery Act funding will allow EM to begin to address the 
environmental liability associated with the Integrated Facility 
Disposition Program, which includes removal of at risk materials and 
stabilization and deactivation of facilities. Recovery Act funding will 
also accelerate cleanup of the most significant sources of off-site 
mercury release to East Fork Poplar Creek to prevent further 
contamination of the area.
Idaho (Total funding $468 million)
    Idaho National Laboratory ($468 million)
    Accelerate demolition of excess nuclear and radiological facilities 
resulting in a footprint reduction of more than 800,000 square feet. 
Recovery Act funds will be used to leverage the efficiencies realized 
through existing decontamination and decommissioning (D&D) contracts. 
The value of the D&D work conducted at Idaho translates into $1.60 of 
work being completed for every Recovery Act dollar spent. The 
acceleration of D&D projects at Idaho will reduce project cost, and 
help to avoid surveillance and maintenance and escalation costs for D&D 
activities. Recovery Act funding will also allow for the retrieval of 
targeted waste per the Agreement with the State of Idaho and accelerate 
the shipment of waste offsite for disposal.
New Mexico (Total funding $384 million)
    Carlsbad (WIPP-$172 million)
    Accelerate completion of legacy transuranic waste shipment 
preparation and shipments to the Waste Isolation Pilot Plant repository 
from one large quantity site and seven small quantity sites. Accelerate 
shipments from four other large quantity sites.
    Los Alamos National Laboratory (LANL-$212 million)
    Demolish 35 buildings and structures across the complex, reducing 
the footprint by more than 260,000 square feet.
New York (Total funding $148 million)
    Brookhaven ($42 million)
    Demolish surplus ancillary structures associated with a nuclear 
research reactor. Remove contaminated soil and buried pipelines and 
dispose of off-site, protecting the surrounding soil and groundwater.
    Separations Process Research Unit (SPRU) ($32 million)
    Cleanup of the North Field Land Area, removal of contaminated soil 
for off-site disposal, perform sampling to confirm cleanup results, and 
regrading and reseeding the area.
    West Valley ($74 million)
    Design and construct a storage system for high-level waste 
canisters and move high-level waste canisters from the former waste 
treatment facility to the new system, allowing the former treatment 
facility to be decontaminated and demolished earlier than planned. 
Begin demolition of former process buildings and install a system to 
prevent migration of groundwater contamination. Accelerate radioactive 
waste treatment and disposal activities to shrink the area of site 
contamination.
Ohio (Total funding $138 million)
    Miamisburg ($20 million)
    Complete remediation of Operable Unit 1 (historic landfill).
    Portsmouth ($118 million)
    Demolish surplus facilities, including electrical switchyard 
structures, cooling towers, and one pump house, and cleanup 65 acres of 
contaminated soils. Remove the source of the highest contaminant 
concentration groundwater plume on site, preventing further potential 
groundwater contamination.
Utah (Total funding $108 million)
    Moab ($108 million)
    Accelerate removal of uranium mill tailings away from the Colorado 
River and dispose of an additional 2 million tons of mill tailings by 
2011, accelerating site cleanup. Recovery Act work will be accomplished 
by increasing the number of railcars and shipments.
Illinois (Total funding $99 million)
    Argonne National Laboratory ($99 million)
    Accelerate demolition of excess contaminated facilities and waste 
cleanout activities several years early.
Kentucky (Total funding $79 million)
    Paducah ($79 million)
    Remove and dispose of large process equipment and demolish surplus 
chemical processing facilities, shrinking the area of contamination.
California (Total funding $62 million)
    ETEC ($54 million)
    Provide $38.8 million for the U.S. Environmental Protection Agency 
to conduct radiological assessments necessary to complete an 
environmental impact statement and enable completion of site cleanup. 
Any additional cleanup work at ETEC will be conducted if regulatory 
approval is obtained.
    SLAC National Accelerator Laboratory ($8 million)
    Accelerate excavation and disposal of contaminated soil and 
accelerate installation of groundwater treatment systems.
Nevada (Total funding $44 million)
    Nevada Test Site ($44 million)
    Identify waste characteristics within the soil at three corrective 
action sites and install groundwater monitoring wells to provide 
additional data on groundwater contamination to support future cleanup 
work. Demolish three major facilities and two smaller structures, 
removing contaminated materials.
Multiple States (Total funding $69 million)
    Uranium Thorium Payments, Statutory Reimbursement ($69 million)
    Reimburse cleanup costs to companies that formerly processed 
uranium and thorium for sale to the Federal Government. These payments 
may allow companies to accelerate completion of site cleanup work.
Management and Oversight/Reserve at Headquarters and Sites (Total 
        funding $70 million)
    The integration, policy management, and other activities funded by 
the Recovery Act will ensure that EM's cleanup mission proceeds in a 
consistent and responsible manner.

                               CONCLUSION

    Mr. Chairman and members of the subcommittee, I would like to 
reiterate that Recovery Act funding provided by Congress will be 
utilized to support footprint reduction and near-term completion 
cleanup activities, and will be executed in a transparent manner in 
accordance with the goals and objectives of the Recovery Act. In 
addition, much of the Recovery Act funding work is associated with 
compliance milestones, which better positions EM to meet its compliance 
commitments going forward.
    EM has made long-term commitments to address its highest risks--
especially tank waste management. While the major portion of EM's 
current budget is devoted to building the capability for tank waste 
treatment and disposition, future investments will be needed to 
complete construction of these facilities and to process the tank 
waste.
    I look forward to working with this committee and Congress to 
continue to accomplish the Department's cleanup commitments. I thank 
you for your attention, and I would be pleased to answer any questions.

    Senator Bill Nelson. What is it that you're cleaning up, 
and why is it necessary to spend all this money?
    Dr. Triay. First off, Senator Nelson and Senator Sessions, 
I share your concerns on behalf of the money and the taxpayers 
who are footing the bill for this cleanup. So, you have the EM 
Program's commitment and the DOE's commitment that we're going 
to be good custodians of the taxpayers' dollars.
    With respect to what are we going to clean up, the National 
Defense Authorization Act for Fiscal Year 2008 requires us to 
send a report, as you are aware, that delineated the life-cycle 
costs of the cleanup and also delineated strategic planning 
business cases that we put together in order to do exactly what 
you have talked about this morning, which is to try to come up 
with ways of accelerating the cleanup and reducing the cost of 
the cleanup.
    Those strategic planning business cases dealt with 
footprint reduction and near-term completions. As a matter of 
fact, as Senator Sessions mentioned, some of the acceleration 
at Savannah River Site came from being able to close areas at 
the site and clean them completely up.
    We came up with a business case so that, by 2015, we would 
reduce the footprint, that is, the contaminated active area, of 
the EM legacy complex by 90 percent by 2015. Based on that 
business case----
    Senator Sessions. Could I interrupt?
    Dr. Triay. Yes, please.
    Senator Sessions. At Savannah River by 90 percent, or the 
other sites you were talking about?
    Dr. Triay. The entire EM complex and, in particular, 
Savannah River Site, I believe, by 87 percent, and our Hanford 
Site, which is the other very large cleanup--those are the two 
major cleanups of the EM complex--also by 90 percent.
    So, we wanted to come up with a way to reduce the complex 
only to its highest-risk priorities--those are tank waste, 
special nuclear materials, and spent nuclear fuel--and do the 
majority of the cleanup for the remainder of the portfolio of 
EM--transuranic waste, low-level waste, soil and groundwater 
remediction, and the decontamination and demolition of excess 
facilities.
    When the President, as well as Congress, started looking at 
options for the Recovery Act, these particular business cases 
became part of the discussion. The business case that we have 
put forth essentially has us completing the footprint--the 
reduction of the footprint at both Savannah River Site and our 
Richland operation--in other words, the Hanford Site--by 45 to 
55 percent; essentially half of what we had analyzed in the 
report that we sent Congress in January 2009. We would do that 
by 2011. I would like to also mention that the activities in 
the Recovery Act funding that I have mentioned before--
transuranic waste, low-level waste, soils and groundwater, and 
excess facilities decontamination and demolition--are 
activities that, by and large, the EM Program has done well.
    As a matter of fact, this morning, I have the honor, 
actually, to introduce you to some of my colleagues that are 
with me--not only Cynthia Anderson, who's the Program Manager 
for recovery funding, but we also have Frazier Lockhart, who's 
a Federal Project Director certified at the highest level that 
the DOE certifies Federal Project Directors.
    The reason I bring this up is, Mr. Lockhart was the Federal 
Project Director when we finished the Rocky Flats cleanup. I 
would like to mention, just along the same lines that both of 
you have discussed this morning, that the Rocky Flats cleanup 
finished 50 years ahead of the originally scheduled completion, 
and that the Rocky Flats cleanup finished $20 billion under the 
original cost that was estimated. Similar figures are also 
available for the Fernald cleanup.
    Even though I completely understand your concern, and, as a 
matter of fact, the EM Program has been heavily criticized for 
issues associated with project management, we have selected the 
activities in this portfolio for the recovery funding to play 
to our strengths. Even though we have had issues in other areas 
of the program, or in specific projects dealing with these four 
areas that we have delineated for this recovery funding, we are 
ready to be extremely effective when it comes to the activities 
in the Recovery Act funding portfolio.
    Senator Bill Nelson. Can you share with us how you 
determined what the cleanup level would be?
    Dr. Triay. The EM Program has a regulatory framework that 
is based on Comprehensive Emergency Response Compensation 
(CERCLA) and Resource Conservation and Reconvery Act (RCRA), as 
well as our own authority under the Atomic Energy Act. So, the 
majority of those cleanup levels are the result of agreements 
between the EPA, the States, and the DOE.
    In addition to that, we have stakeholders, such as the 
communities, and we have Tribal Nations that we have 
responsibility to consult with. So, these are negotiated 
cleanup standards that are agreed to for the particular 
cleanup.
    Senator Bill Nelson. That's how you come to the percentage 
cleanup that you're going to achieve?
    Dr. Triay. That's correct.
    Senator Bill Nelson. The timetable in which you're going to 
do it, that's negotiated, as well?
    Dr. Triay. The timetable is also negotiated, and it depends 
on the funding profile that is assumed. It depends on the 
degree of maturity of the technology. But, yes, the timetables 
are also negotiated among all of those parties.
    Senator Bill Nelson. All right. Of the material remaining, 
how do you go about accounting for all of that, of what you're 
not going to clean up?
    How are you going to manage those sites to account for the 
remaining material?
    Dr. Triay. We have--for instance, for nuclear materials, we 
are consolidating all of our nuclear materials at the Savannah 
River Site from our Hanford Site, as well as Los Alamos 
National Laboratory, Lawrence Livermore National Laboratory, as 
well as other parts of the complex. We have very strict 
controls associated with safeguards and security for ensuring 
the security of those nuclear materials that are being 
consolidated at the Savannah River Site.
    With respect to the radioactivity that, when we clean up, 
we may leave behind because we have not done 100 percent 
cleanup, in terms of not leaving the site at pristine 
conditions, we do surveillance and maintenance monitoring to 
ensure the protection of the environment with respect to the 
level of cleanup that we have agreed to with the State and the 
EPA and other parties.
    Senator Sessions. I would like to follow up on these 
agreements. Agreements made many years ago--when were these 
agreements, some of the major agreements, and when were they 
entered into?
    Dr. Triay. Some of them, decades ago.
    Senator Sessions. I've seen it, for example, in agreements, 
consent--confirmed by Federal judges, like in desegregation 
cases; after 20, 30 years, it becomes not a feasible thing. 
Those things can be amended. So, I guess my first question 
would be, if you have provisions in those agreements that don't 
make sense for the taxpayers of America, have you undertaken 
any evaluation to see to what extent they can be amended to 
accomplish the goal and also to contain these incredibly 
surging costs?
    Dr. Triay. Senator, these agreements have been amended many 
times. As a matter of fact, on an annual basis, the majority of 
the agreements are discussed with our regulators and the 
communities where we actually have the cleanup agreements. As I 
was describing before, we have significantly amended the 
agreements and delayed some of the completion of the cleanups.
    Senator Sessions. When you say that, does it have to be 
done with the consent of all the parties to the agreement?
    Dr. Triay. That is correct, sir. That's right.
    Senator Sessions. But, now, of course, if I had signed an 
agreement, I might find it politically difficult to agree to 
any modification that reduced spending, reduced employment in 
my area, and would even minutely reduce the pristine nature of 
the cleanup. So, if we're dependent completely on the consent 
of the local people who have an agreement, sometimes you have 
to go--how do you--have you considered legal avenues of 
amending that, in light of changed circumstances?
    Dr. Triay. Senator, one of the main things that we do in 
the EM Program, is to try to find a balance between the degree 
of the cleanup and a balance that is respectful of the 
taxpayer. So, notwithstanding the fact that the agreements 
started many decades ago--as I was saying, the States, as well 
as the regulators, EPA, as well as State regulators, Tribal 
Nations, local communities--have negotiated with us and agreed 
to delay many of the completions, as well as the degree of the 
cleanup.
    Senator Sessions. Okay, you've made some progress here, and 
I think that happened at Savannah River. I think local people 
agreed to a speedier cleanup and a less expensive cleanup. But, 
do you agree--where did this $210- to $260-billion figure come 
from? Is that what we now expect to do under the existing plans 
that you have at Energy? Is that your number?
    Dr. Triay. Yes, the numbers are $205 to $260 billion and we 
have published in the report that was sent to Congress. Those 
numbers came from that report.
    Let me just elaborate a little bit on these life-cycle 
costs. Scope, cost, and schedule are difficult to calculate for 
cleanups that are going to take decades. So, what we do is, we 
present a range, which is the range that you have quoted this 
morning. The reason for the proposal that we made, or the 
concept that we presented in this particular report to 
Congress, was to tackle those large total project costs--total 
program costs, life-cycle costs, as well as the duration of the 
cleanup. We think that economies of scale, being able to have 
ability to accelerate the decontamination and decommissioning 
of some of these facilities that are deteriorating and, once 
that they deteriorate, they become even more expensive to clean 
up, was one of the ways to actually reduce the life-cycle cost 
and reduce the amount of time of the cleanup. So, that was, 
indeed, the reason for the concept that was presented in the 
report that we sent to Congress in January 2009.
    Senator Sessions. But, you would admit that, just a few 
years ago, the high-side estimate for the cleanup was $180 
billion, I believe, and now the high-side estimate is $260 
billion. That is an incredibly huge overrun of just an estimate 
of a few years ago. Am I wrong about that?
    Dr. Triay. Senator, let me address that. The Government 
Accountability Office (GAO) has been very critical of EM's 
project management, has said that in the cleanup projects the 
two main reasons for the issues were, number one, the fact that 
the assumptions that were used were very aggressive, and number 
two was lack of reality in the funding profile that we used for 
the life-cycle cost.
    Of that life-cycle cost, an increase of $70 billion; 40 
percent of that was because we rebaselined the entire program 
to recalculate the life-cycle costs based on a funding profile 
that was more realistic, which was, essentially, around $6 
billion as an assumption--per year--in terms of how we were 
going to conduct the cleanup. When some of those agreements 
were signed, the annual budget that was assumed for some of 
those agreements went from $7.5 billion to $8 billion. So, by 
coming up with realism associated with the funding profile 
based on economic realities that we have in the country, 40 
percent of that increase in the life-cycle cost was simply a 
matter of delaying the cleanup and moving it to the right so 
that, per year, we could be on the order between $5.5 billion 
and $6 billion per year. Another 40 percent of that increase in 
the life-cycle cost came from unrealistic assumptions, such as 
the amount of waste that we were going to be able to leave, for 
instance, in underground tanks; for instance, assumptions such 
as the nuclear materials portfolio of the DOE was not going to 
be part of the EM cleanup, but was going to be transferred out 
of the EM Program. There's no question that some of that life-
cycle cost increase is due to performance of our contractors. 
But, the vast majority of that life-cycle cost increase was 
because of assumptions that were too aggressive and lack of 
reality in the funding profile.
    In addition to that, this particular report that we're 
talking about that was sent to Congress in January 2009, 
delineated the excess facilities that were not part of our EM 
portfolio, and were delineated by other programs, such as 
Nuclear Energy, the National Nuclear Security Administration, 
and the Office of Science, where there are facilities that were 
no longer needed and also needed to be cleaned up, 
decontaminated, and demolished. Those facilities in that report 
to Congress, we reported that the range of that particular 
amount of money to deal with those facilities, was between 
almost $4 billion and $9 billion. So, about 15 percent of that 
life-cycle cost increase came from the excess facilities that 
were transferred to the EM portfolio as late as this year and 
excess facilities that are part of the liability of the DOE.
    Senator Bill Nelson. Senator Begich, I need to get through 
just a few questions here, and then I'm going to have to excuse 
myself momentarily to go make a presentation in another 
committee. So, if you will indulge me, let me just go on and do 
that, and then I'll call on you.
    With regard to what you're addressing to Senator Sessions, 
part of the growth that we've been talking about is growth in a 
number of projects. So, while there has been the growth in cost 
of individual projects, there have been, also, a lot more 
projects that have been added to the EM Program. Then in the 
future, as the weapons complex reduces, those excess facilities 
that are no longer needed are themselves going to have to 
transfer to EM to decontaminate and to tear them down. Is that 
correct?
    Dr. Triay. Correct.
    Senator Bill Nelson. Okay. Now, let me ask you, on the 
stimulus bill projects, how did you decide what projects were 
going to be funded?
    Dr. Triay. First, projects that had an established 
regulatory framework, the reasons that both you and Senator 
Sessions have been talking about, where we don't have 
established regulatory framework becomes very difficult to be 
effective in the cleanup.
    Second, proven technologies. In other words, we have had 
issues, serious cost and schedule issues, in the EM Program, 
when we are doing first-of-a-kind projects. We made sure that 
the activities in the portfolio had proven technologies 
associated with the cleanup.
    Number three, cost, schedule, and scope. Those plans had 
already been delineated by the EM Program so that we 
essentially had shovel-ready activities that could be started 
as soon as we received the funding.
    Senator Bill Nelson. Are any of the stimulus funds used for 
ongoing construction projects?
    Dr. Triay. No funds in the Recovery Act portfolio are used 
for construction projects. All of the funding is for 
transuranic waste, low-level waste, soils and groundwater 
remediation, and decontamination and decommissioning of excess 
facilities. There is one exception, which is $300 million that 
has been given to the Office of River Protection in Hanford, to 
improve the tank farm infrastructure to be ready for when the 
waste treatment plant becomes operational in 2019.
    Senator Bill Nelson. So, when you use the term ``shovel-
ready,'' you're talking about the projects you've just 
described.
    Dr. Triay. Absolutely.
    Senator Bill Nelson. All right. Now, are the projects that 
are going to be funded first with the stimulus bill money, is 
this addressing the high-risk and the most cost-effective 
projects?
    Dr. Triay. The highest risks of the EM Program are, indeed, 
tank waste, special nuclear materials, and spent nuclear fuel. 
Because the rules of engagement of the activities that we were 
going to put in the portfolio of the Recovery Act funding were 
established regulatory framework, proven technologies, and 
cost, scope, and schedule baselines that were already 
established, we did not put any activities in the Recovery Act 
funding associated with tank waste, special nuclear materials, 
or spent nuclear fuel, which actually are the highest-risk 
activities of the EM Program.
    The reason for that, Senator, is that, as you were 
describing in your opening remark, over the years, because the 
EM Program has been assigning their base program--in other 
words, the annual appropriated funds--to those highest-risk 
priorities, we have been deferring transuranic waste, low-level 
waste, soils and groundwater remediation, and decontamination 
and decommissioning, to the point that some of our excess 
facilities have become deteriorated so that when our workers 
try to go in to clean them up, they are at risk, and then all 
that happens is, the cleanup takes all that much longer and it 
costs all that much more. So, that is the reason why the 
Recovery Act funding is associated with the part of the 
portfolio that is not the highest risk.
    Senator Bill Nelson. Senator Begich, I'm going to call on 
you, and Senator Sessions will chair the meeting until I can 
get back.
    Senator Begich. Thank you very much, Mr. Chairman.
    I want to hone in on a couple of things regarding--I've 
just been scanning the report that was delivered in January, 
but let me walk through the contractor lay of the land, and 
that is--make sure I understand it.
    You now have double your capacity, in dollars, $6 billion 
to $12 billion. The contractors that you currently have, your 
goal is to modify 90 percent or so of those to do that 
additional work in those locations. What is the current status 
of those modifications of those contracts? Have you done that? 
Or, when do you anticipate those contract modifications to be 
completed?
    Dr. Triay. We have established an internal deadline for 
those modifications. Let me explain a little bit about how the 
process works.
    The first thing that is done is the Government does an 
independent government estimate that is based on all the work 
that we have done on cost, schedule, and scope--baselines that 
I was describing a moment ago. So, then we put a modification 
to the contractor that is what we call ``undefinitized,'' 
meaning that the Department and the contractors have not agreed 
on how much the work is going to cost and how long it's going 
to take, so essentially, all the scope is in that 
modification--that is not definitized, but the schedule and the 
scope are then negotiated. Those negotiations, based on the 
independent government estimates, are going to take on the 
order of 3 months.
    Senator Begich. So, you anticipate that, from today, maybe 
midsummer, you'll have those modifications completed.
    Dr. Triay. That's correct.
    Senator Begich. Okay. Now let me ask you a couple of 
questions on those. The 90 percent, these contractors that you 
have, of the contracting world that deals in this industry, or 
this area, how much of the capacity will you consume? All of 
it?
    Or, let me ask it another way. I'm sorry.
    Dr. Triay. Yes.
    Senator Begich. Are there contractors that are out there, 
that are not going to be part of this new equation because 
they're not current contractors, that could do this work?
    Dr. Triay. Part of what we were trying to accomplish with 
the Recovery Act funding was, indeed, to have contract vehicles 
that were in the ready so that we could move forward with the 
work. In some cases, we have what is called a contract that we 
have already awarded, in terms of the contractors that are 
capable of doing work. It's like a task-order contract that--
where we can compete those tasks among the contractors that 
have already been preselected. Some of the funds--like, for 
instance, all of the funds associated with the Oak Ridge 
National Laboratory decontamination and decommissioning of 
facilities in the laboratory--will be competed through those 
task orders. The majority, however, just like you have 
delineated, is going to go to contracts that are already in 
place, where the contractor has already been selected.
    In terms of the capacity, are we going to use all the 
capacity? We have required our contractors to heavily utilize 
subcontractors, especially small-business subcontractors, and 
in addition to that, with respect to the capacity, the amount 
of individuals that are out there looking for work, every day 
we have people coming in to look for work, working for either 
the subcontractors or the prime contractor, we have a factor of 
10 higher interest than the people that we need. For instance, 
at Oak Ridge we had 76 jobs that were being competed for, and 
1,000 people showed up for 76 jobs. At Hanford, 4,000 
individuals showed up to get the jobs that were available. 
South Carolina, Savannah River Site, thousands of workers in 
the union halls and a tremendous success, in terms of the 
people who want to work in this area. So, with respect to 
whether we can staff this work, I think that what the data that 
we have shows that we are going to be able to do that.
    Senator Begich. Let me ask you, if I can, just a couple 
more quick ones on the budget process, because I think, Senator 
Sessions, you brought up an interesting point of escalation. 
You mentioned independent cost estimates. Do you have something 
that you could at least share with me--I don't know if other 
committee members would be of interest in this--but, when 
you've done these cost estimations, what the final outcome is, 
based on that? I'm guessing, here. I come from being a city 
mayor. They're never right, the estimations, and the costs are 
much more. The danger I worry about here is, you're using--I 
understand the timetable, but rushing, which then is costing us 
more money, is somewhat dangerous. Why I say that is, these 
contractors know they're getting the business. It's a 
guarantee. You're going to do the work with them. So when 
you've exceeded the cost of independent government estimates, 
what has been the penalty for those contractors? Or, have you 
just assumed that cost with a negotiated--because I understand 
everything is negotiated. We do that a lot, when I was in the 
city government, and you end up paying, still, but you 
negotiate, and they work that into their costs on the front 
end, because that's how they do the business. Now, do you have 
something you could share, if it's the last 2, 3, 4 years of 
work, that you have had a cost estimate before the work is 
done, what the final work is done, and what did the contractor 
pay or not pay?
    Then on top of that, are there any of these contractors 
that are currently under any cloud with the Federal Government 
in any other work they do with your agency or any other agency? 
What I mean by that is, are there contractors that have issues 
with the Federal Government on cost overruns in any other 
business they do with the Federal Government?
    Dr. Triay. Senator, let me answer the question and tackle 
the serious issues that you have raised.
    With respect to how we have analyzed the original cost and 
the actual cost, we do have some data indicating that, since 
2004, the actual projects that were completed--we completed 19 
projects, and, of those, 85 percent had cost success, meaning 
within 10 percent; 95 percent had schedule success; and all of 
them completed all of the scope.
    Having said that----
    Senator Begich. Can I ask you a quick question?
    Dr. Triay. Yes. Yes.
    Senator Begich. What was the total value of those projects?
    Dr. Triay. Over 6----
    Senator Begich. Does that mean----
    Dr. Triay. --way over $6 billion.
    Senator Begich. So, 10 percent is a big number.
    Dr. Triay. Not for each one of them. I mean, the total.
    Senator Begich. Gotcha.
    Dr. Triay. They ranged from $11 million all the way to $6 
billion, individually.
    As I have already stated, the EM Program has had serious 
issues with schedule delays and increase of costs. So, let me 
also tell you what we're doing to ensure that this doesn't 
happen, moving forward.
    First off, even though we have obligated 80 percent of the 
funds to the States, 80 percent of the $6 billion to the sites 
that we have in the different States, we have only authorized 
them to spend 30 percent of that 80 percent. In other words, 24 
percent of the $6 billion is the only thing that is going to be 
authorized for costing.
    In addition to that, every time that we go from that 24 
percent all the way to, hopefully, the 100 percent, meaning the 
$6 billion, every 20 percent increment has to be authorized, 
not only by the office of Cynthia Anderson, who's the Program 
Manager for the Recovery Act funding, but also by the Chief 
Financial Officer of the DOE. The Office of the Chief Financial 
Officer also has to, independently from the EM Program, sign 
off on that 20 percent interval authorization.
    Let me tell you how we're going to decide whether the next 
20 percent is going to be allocated or not. It's going to be 
based on cost performance index and schedule performance index. 
What that means is that we are going to require that those 
contractors that--the site--our field sites are asking for the 
additional--the next interval--are going to be at a cost and 
schedule between .9 and 1 or, of course, above. We're going to 
require that performance is there, based on rigorous earned-
value-management system, which means that we know how are they 
doing with respect to the plan that was put in place, and the 
initial cost estimates that the government has recorded.
    So, it's not even a matter of what's going to happen after 
something happens, because it's not going to happen, to start 
with. If there is a nonperforming contractor at a particular 
site, we're going to evaluate whether the problem can be 
resolved; if it cannot be resolved, we're going to go to the 
next project on that site, and, if not, the money may very well 
have to be moved from one site to another one that is 
performing. This is about, of course, job creation, but also 
about performance for the cleanup.
    Senator Begich. Very good. Thank you very much.
    Thank you, Senator Sessions.
    Senator Sessions [presiding]. Just one question. How many 
contractors in the last 4 years, to your knowledge, have been 
terminated for nonperformance or failure to performance--
perform on time?
    Dr. Triay. We have not terminated a contractor for 
nonperformance in the last 4 years; we have taken other 
contractual actions. We have taken scope work from the 
contracts that, that contractor is no longer going to do a part 
of the work, and we have competed, then, a particular part of 
the scope that was in the contract.
    Senator Sessions. Senator Graham?
    Senator Begich. Senator Graham, I apologize. There is that 
other part of the question, and you just triggered me, and if I 
could just ask, to make sure we're clear.
    Can you provide to me, or to the members of the committee 
who are interested, if any--again, these contractors that are 
currently doing the business, and will be doing the business, 
if any of them have any issues in front of the Federal 
Government in regards to costs or other types of issues, maybe 
with your agency or any other agency, could you provide that?
    Dr. Triay. Absolutely.
    Senator Begich. I apologize, Senator Graham.
    Dr. Triay. We will provide that information, absolutely.
    [The information referred to follows:]

    There is one contractor that has cost or business-related issues in 
front of the Office of Environmental Management:

         In Office of Inspector General (OIG) Audit Report No. 
        DOE/IG-0811, Washington Savannah River Company, LLC, Internal 
        Audit Function, the OIG identified problems with the internal 
        audit function at Washington Savannah River Corporation, LLC, 
        which led to some questioned costs not being brought to the 
        attention of the applicable Federal contracting officer for 
        adjudication of cost issues. This contract is transitioning to 
        subsequent awardees and will not be receiving any Recovery Act 
        funding.

    Senator Begich. That was kind--you triggered me on that 
one.
    Senator Graham. Thank you. Thank you for your willingness 
to do this job.
    I represent South Carolina, and obviously Savannah River 
Site's a big issue for the State. We've been through a couple 
of administrations, and I think the overall theme of the 
hearing, here, is that we seem to be spending a lot of money on 
cleanup and not advancing the cleanup agenda as much as 
everyone would like. So we have a new chance here to start 
over.
    As far as the stimulus money goes, whether it be Savannah 
River Site or any other site, can you assure us that you're not 
taking one-time money and creating new programs with it?
    Dr. Triay. I can assure you of that, Senator. This work is 
work that was already clearly delineated in the report that the 
DOE sent to Congress in January 2009. There are not going to be 
future liabilities associated with starting any particular 
program or construction or anything of that nature. We are 
committed to use the taxpayers' dollars wisely.
    Senator Graham. So, the bottom line is that the stimulus 
money, which is a 2-year funding stream, is not going to be 
used to create a program that has a funding stream past 2 
years.
    Dr. Triay. Absolutely, that's a correct statement.
    Senator Graham. Okay. That's good.
    Now, when it comes to energy independence, which is a 
laudable goal, bipartisanly pursued here, the national 
laboratories, I think, can be very important pieces of that 
puzzle. What's your game plan to improve the infrastructure of 
the national labs? I think the newest national lab is Savannah 
River Site, and--can you tell me, just briefly, where do you 
see the national labs going, in terms of the funding from DOE?
    Dr. Triay. We are very committed to the Savannah River 
National Laboratory's capabilities and the EM Program. Coming 
back to some of the comments made by Senator Sessions on the 
daunting task part of the cleanup, the high-level radioactive 
waste and underground tanks are something that need to be 
aggressively pursued. Savannah River National Laboratory, my 
intent is for them to become the premier chemical separations 
laboratory in the world. I think that they completely have the 
tools and the type of people.
    Senator Graham. Right. Yes.
    Dr. Triay. So, we are going to invest in technology 
development in--not only at the Savannah River National 
Laboratory, but where the talent is across the complex. But, 
for chemical separations, clearly a lot of the talent is there 
at the Savannah River National Laboratory.
    Senator Graham. Two quick areas. One of the things we're 
doing at Savannah River Site National Lab in the community is 
research on the use of hydrogen to fuel cars. I know that's 
going to be part of the energy mix, is try to have vehicles 
fueled by hybrid--hydrogen. So, I'll talk to you about that 
later on, more privately.
    H-Canyon. As you are, I'm sure, aware of, Savannah River 
Site was chosen by the Clinton administration to be the MOX 
fuel facility, where it would take 36 tons of weapons-grade 
plutonium excess to our defense needs, and the Russians would 
take a like amount, and take the plutonium pits that are 
nuclear bullets and turn them into plow shares to create 
commercial fuel. South Carolina has agreed to be a receiving 
site for this plutonium, so you could consolidate it there, 
save a lot of money, and eventually turn it into commercial-
grade fuel, taking what would have been a nuclear-weapon-grade 
material down to commercial fuel level. We're way behind in 
construction there, and I know that's a different bailiwick.
    But, the material that we receive from the weapons 
complexes that can't be MOX'd, turned into commercial fuel, the 
goal was to run it through H-Canyon and vitrify it. H-Canyon, 
to me, is a national treasure. In 2001, we passed the National 
Defense Authorization Act, that said that H-Canyon would be 
required to maintain a high state of readiness. What is your 
view of H-Canyon?
    Dr. Triay. We're committed to H-Canyon. We're committed to 
the high state of readiness. We, as we have discussed on some 
occasions with your staff, are always looking for ways to be 
efficient and effective, including H-Canyon. That's a 50-year-
old facility and we always are looking for improvements to the 
life-cycle cost of that facility. We have had GAO questions 
with respect to H-Canyon, and our plan is to continue to use H-
Canyon for excess plutonium processing, but in addition to 
that, trying to accelerate the plutonium processing any way we 
can for the obvious reasons.
    Senator Graham. One final question. If you close Yucca 
Mountain, which apparently is the game plan now, under the law 
that created Yucca Mountain, high-level defense waste would 
have priority. A lot of the DOE sites have legacy materials 
from the Cold War, spent fuel is obviously a problem. The goal 
was to take our spent fuel from commercial reactors and store 
it in Yucca Mountain. But, what has not been talked about 
nearly as much is high-level waste from the DOE complexes and 
DOD complexes that helped us win the Cold War.
    In terms of timelines for disposition, if Yucca Mountain is 
no longer available, how does that change the timelines to 
dispose of this high-level waste? What do we do with it?
    Dr. Triay. With respect to the timelines associated with 
the EM Program, Yucca Mountain is not part of the 
responsibilities of the EM Program.
    Senator Graham. But, it is a place you would send the 
materials.
    Dr. Triay. Of course. So, with respect to the EM Program 
activities themselves, we're a long ways away for the Yucca 
Mountain decision or potential repository to change any of our 
plans. We are constructing the Salt Waste Processing Facility 
at the Savannah River Site to get on with the treatment of the 
tank waste and vitrification of that waste. Because you have 
visited all of these facilities and have been a leader for us 
for this work, we have the facility that vitrifies the waste 
and is vitrifying sludge today, and has been for some time. So, 
we actually are going to continue with our plans and put all of 
the waste--we're going to vitrify all of the high-level waste. 
That is a very robust waste form that affords a tremendous 
amount of protection to the environment.
    Senator Graham. Right.
    Dr. Triay. With respect to what happens after that, we are 
going to rely on the blue ribbon commission that Secretary Chu 
is----
    Senator Graham. But, you don't see the timelines being 
changed because of the decision to close Yucca Mountain.
    Dr. Triay. I don't see the timeline of vitrifying the waste 
being changed in any way because of that decision, no.
    Senator Graham. Okay, thank you. I look forward to working 
with you.
    Senator Sessions. On that question, if Yucca Mountain is 
not open, what impact does that have on you? Could that even 
drive up the cost of cleanup even more?
    Dr. Triay. As I was saying to Senator Graham, we are 
decades away from any impact to the EM Program.
    Senator Sessions. So, it's going to be decades before you--
but, your ultimate plan was to transmit this waste to Yucca, 
correct?
    Dr. Triay. That is correct. But, right now----
    Senator Sessions. What would you do with it if you didn't?
    Dr. Triay. We are going to vitrify it, if it is high-level 
waste. If it is spent nuclear fuel, it's going either into dry 
storage or to a Savannah River Site to be reprocessed through 
H-Canyon and also vitrified. Those are very protective waste 
forms. Clearly dry storage for spent nuclear fuel is very 
protective of the environment.
    Senator Sessions. I understand all that, but----
    Dr. Triay. We're committed, we're committed.
    Senator Sessions. It has impact if we don't use Yucca, 
because--frankly, I share your view that the storage, in dry 
cask storage on site, is not a danger. Unless someone goes and 
sits on it, it's not going to blow up, it's not a threat to the 
safety, if it's well-managed, and it can stay there for 
decades. I have no doubt of that. But, in this political world 
we're in, most folks feel that's a unacceptable long-term 
solution. The long-term solution was to move it to Yucca. A 
decision to cancel Yucca alters your long-term plan for the 
disposal of that waste. Yes or no? If we cancel Yucca, doesn't 
that alter your long-term plan for disposal of this waste?
    Dr. Triay. As I was saying, for the next 20 years, we were 
committed to get the waste into glass or into dry storage for 
spent nuclear fuel. So, for the next two decades, it doesn't 
impact the EM Program. Whether it affects it for the longer 
term----
    Senator Sessions. Was the plan to transfer it, at some 
point in the future, to a national storage center, which has 
been generally considered to be Yucca? Is that correct?
    Dr. Triay. That is correct.
    Senator Graham. Can I just----
    Senator Sessions. Yes.
    Senator Graham. The reason this is important is because 
we've always wanted a pathway forward. When Savannah River Site 
agreed to take the 36 tons of weapons-grade plutonium, the 
Democratic Governor at the time--this was during the Clinton-
Bush years--threatened to lay down in the road. I got a statute 
passed that put penalties on the Federal Government if they 
didn't hit their timelines, because we made a leap of faith, 
here, that we're going to take this material--and I told people 
in South Carolina it's going to, the pits are going to be 
disassembled, it's going to create good jobs, we're going to 
vitrify what can't be MOX'd, and there'll be a pathway forward, 
either through MOX, vitrification, Yucca Mountain. I guess what 
Senator Sessions is saying is that we need to reassure people 
that, 20 years from now or whatever, that there's going to be a 
pathway forward out. Because if we don't do that, then sites 
are going to be very reluctant, in the future, to embrace 
change.
    We also, with Senator Sessions' help, came up with a plan, 
when it came to tank-waste storage in South Carolina. The State 
of South Carolina and the DOE and the last administration--to 
leave some material in the heel of the tank that would save $16 
billion, instead of scraping it all out and sending it to Yucca 
Mountain to just fill the place up quickly with stuff that you 
could leave in South Carolina. We made a bold decision at the 
time to leave some of this waste in the tank, save a lot of 
money; wouldn't hurt South Carolina. We're behind schedule 
there.
    So, I know you're new here, you get a chance to start over, 
and I really do want to work with you. But, the one thing we're 
going to have to do is to assure these States and sites that 
are willing to do things differently, they're not going to get 
stuck, and that's the point. There's a lot of concern now that 
if Yucca Mountain is taken off the table, have we been left 
holding the bag, here, 20 years from now, or 15 years from now 
? This agreement to leave the tank waste behind in South 
Carolina, if it's behind schedule, were we smart to do it? So 
help us work through these issues, because I think we can save 
a lot of money if we'll just look at this whole stuff anew.
    Dr. Triay. We are completely committed to meeting our 
commitments to the States to have a path out for high-level 
waste, as well as the spent nuclear fuel. As Secretary Chu has 
shared with you, we're looking at the blue ribbon commission to 
ensure that we have those options that are viable, that will 
meet our commitments to the States.
    Senator Graham. Thank you.
    Senator Sessions. I know you don't want to get into a 
political fray, here. I'll just do it. There are a lot of 
ramifications for not proceeding with Yucca. It's not just 
commercial-reactor spent fuel, it's nuclear Cold War residue, 
fuels like this. If we don't do Yucca after all we've spent on 
it, I don't know what we're going to do. There's no plan out 
there. Maybe this blue ribbon commission can solve it, but 
we've gone from having a plan to having no plan. That's what 
Senator McCain has complained about, and I think he's correct.
    Nuclear power is a part of our reality, and nuclear weapons 
are going to be part of our reality, as long as I'm on this 
Earth, I assume. It's just a problem that I'm worried about.
    Senator Begich, did you want a turn?
    Senator Begich. I do, yes.
    Senator Sessions. Interject right now, if you'd like.
    Senator Begich. If I could, thank you very much.
    Because I'm new to this whole process here, let me make 
sure I understand this right. When you say that, for 2 decades, 
you're--approximately 2 decades--could be more, could be--but, 
that you feel very secure that you have ability to move the 
waste and put it properly away. It's a question of after that, 
that you're now planning for, but not yet definitive of where 
that is.
    Is that correct?
    Dr. Triay. That is exactly correct. However, committed to 
finding a path out.
    Senator Begich. I understand that. Now, when I look at--and 
I have to look at the name of this report, and I think this is 
the same one you referenced a couple of times, the January 2009 
report.
    Dr. Triay. Correct.
    Senator Begich. I've been just flicking through it real 
quick, here, but on page 79--it's in your summary--it's not the 
appendix that has all the detail by each project within the 
projects, but it's a pretty good summary, and it shows the 
remaining costs in 2008. I have a high and low number on that, 
and then you have ``planned completion date'' date range. When 
I did a quick check here, a lot of these projects will be done 
within the 20 years. Right? There are some big ones that 
aren't. I recognize that. But, help me understand, just so I 
get the connection between these ``project completed,'' the 
concern that Senator Sessions has, and Senator Graham, are we 
talking about the remaining projects that I've checked off that 
are, in some cases, 75 percent complete at that stage--but, are 
they--what's the----
    Dr. Triay.--we only have high-level waste and spent nuclear 
fuel with respect to the projects that are listed here on page 
79. Three sites.
    Senator Begich. Which ones are those, just so I'm clear?
    Dr. Triay. The Hanford Site, Savannah River Site, and the 
Idaho site.
    Senator Begich. Where is the last one? I'm sorry.
    Dr. Triay. Savannah River Site, Hanford Site, and the Idaho 
site.
    Senator Begich. Oh, Idaho, okay.
    Dr. Triay. So, those are the three sites that we are 
committed to delineating a solution for a path out for the 
spent nuclear fuel and the high-level waste. As you can see, 
those sites have a longer period for completion. In Idaho, in 
particular, the agreement that we have with the State in one of 
the negotiated agreements is for 2035.
    Senator Begich. 2035, okay.
    Let me end on that, but I'll go back--I have some other 
questions, but they're a separate issue.
    Senator Sessions. All right. Just to note that this $6 
billion increase in funding was a stimulus package bill that 
DOE projects would create 13,000 jobs. But, to give an 
indication of how much money $6 billion is, that averages, just 
by mathematics, $461,000 per job. So, I want to say, first of 
all, in terms of a pure jobs package, this is not--it can only 
be considered as a--money to get this job done, an advance 
payment to you, the DOE, to perhaps accelerate it and keep up 
with where we need to be with regard to cleanup.
    Dr. Triay. Senator Sessions, that figure that you quoted, 
of course, we would have to divide that by the amount of years, 
because obviously we don't want to hire somebody and then fire 
them. In other words, we would hire one person for 2\1/2\ 
years.
    So, having said that, let me just address your concern----
    Senator Sessions. First of all, I know you're going to have 
to buy technology, equipment, and machinery, all of which makes 
the cost per employee go up. I'm just saying, as a pure jobs 
bill, this is not a big winner, in terms of jobs per dollar 
invested. But, it does create jobs, no doubt.
    Second, what I want to stress with you, as I stressed with 
Secretary Bodman and your predecessors, is that I consider the 
amount of money we're talking about unacceptable. $260 billion 
is unacceptable. We're paying you to do something other than 
business as usual.
    Now, are you bringing in experts, thoughtful people who can 
help you do some of the things that were done in Savannah River 
that got the project quicker, saved $16 billion, and got us on 
the right track in a better way?
    We need to save this money. If you took $1 billion, $2 
billion a year, and used it to incentivize windmills or hybrid 
cars or other things that could benefit this country, research 
and development in clean coal, and things of that nature, it 
would be huge over the next 20 years. It would be huge.
    So, right now we're spending it on a cleanup program that 
continues--it's indisputable to go up in dramatic fashion. It 
was $120 billion, as I recall, just a few years ago. Then it 
was announced, in this subcommittee, that it was $180 billion, 
and now you announce in January, with your report, that it's 
$220 billion to $260 billion. It just continues to go up. 
Somehow we have to get off this treadmill.
    Are you looking creatively and are you demanding of every 
employee under you that they are thinking on how we can do this 
project in an effective way?
    It may require some renegotiation of contracts and 
agreements. I understand that's driving some of this. But, if 
an agreement no longer makes sense--Senator Graham worked with 
you to make that change that seemed to be effective. Are you 
thinking in that way?
    Dr. Triay. Absolutely, Senator Sessions. The reason I 
brought up the strategic planning that led to footprint 
reduction and near-term completions is because that strategic 
planning, as delineated in this report, also talks about tank 
waste, which is half of that life-cycle cost, and in addition, 
talks about spent nuclear materials and spent nuclear fuel. We 
are looking at every possible opportunity, but in particular, 
at transformational technologies and concepts.
    Secretary Chu has talked to me, in no uncertain terms, 
about his expectations of us looking at those transformational 
technology development or concepts that are actually going to 
dramatically--could dramatically reduce tank waste, spent 
nuclear materials, and--
    Senator Sessions. Let's just follow what Senator Graham 
suggested, that, as I understand it--I may be wrong, but, as I 
understand, the South Carolina agreement was that you get 90 
percent of the waste removed and then you have a tank that has 
some residue, minor residue, that's not easily recoverable, 
except by digging up the entire tank and treating the entire 
tank as a nuclear waste, and they agreed that you get every bit 
of it out the tank that's possible, and they agreed that you 
could leave the remainder there to gradually decay over the 
years, in years to come. Is our plan, at the other sites, the 
complete, pristine removal of the tanks? Is that a factor in 
the higher cost at the other sites?
    Dr. Triay. No, sir. We don't have plans at other sites to 
remove the tanks. But, just so that I can tell you, Senator 
Sessions, I was the lead technical assistant to Congress from 
the DOE on section 3116 of the National Defense Authorization 
Act for Fiscal Year 2005, which I believe is the section that 
you're talking about, where we were able, as a result of that, 
to leave waste, after consultation with the Nuclear Regulatory 
Commission, as low-level waste as part of the tanks. So, we are 
completely committed to making sure that we look at these 
transformational technologies and concepts that can reduce the 
cost, especially in the area of tank waste, spent nuclear fuel, 
and special nuclear materials.
    You have my commitment for the EM Program to work with this 
subcommittee and ensure that we work collaboratively, but 
expeditiously, to reduce the life-cycle cost and reduce the 
amount of time that this cleanup is going to take. You are 
completely right about the fact that we need to look very 
creatively at how to deal with this cleanup.
    Senator Sessions. Thank you. Nothing comes from nothing. 
The money spent should compete with other energy environmental 
concerns. $260 billion is a lot of money that could, I think, 
if we did this thing right, reduce that cost and save $100 
billion, and that $100 billion could be better used in other 
ways to improve the environment, would be my thinking. I 
certainly hope that we're not locked into some sort of 
agreement we made 30 years ago, or a mindset in energy that 
does not look for these new, creative ways to deal with it. I'm 
glad to hear you're committed to that. I did talk to Dr. Chu 
about it, and I think he understands the immensity of the money 
that this cleanup program costs, and it provides an opportunity 
to do better things with limited dollars, if we can save them.
    Dr. Triay. Yes.
    Senator Sessions. Thank you, Mr. Chairman, and thank you 
for your good leadership. I do have to make another 
appointment. I know you're pleased with the new FEMA director 
from your State. You had to go introduce him at the committee 
hearing today. I hear good things about him.
    Senator Bill Nelson [presiding]. Indeed, and thank you for 
your continued leadership, Senator Sessions. It's a pleasure to 
work with you. We have a lot of work to do in this 
subcommittee.
    Senator Sessions. Yes, we do. I look forward to working on 
a time with you to discuss your trip to Eastern Europe.
    Senator Bill Nelson. Thanks.
    Following up on this, Dr. Triay, EM was going to focus on a 
number of sites that could be cleaned up and closed much more 
quickly. Rocky Flats was one of those, and Congress went along 
with that, on the condition that when Rocky Flats was finished, 
the savings would be applied to accelerate cleanup at other 
sites. With the accelerated cleanup at Rocky Flats, there were 
substantial savings, but those savings were not used to 
accelerate cleanup at other sites. What are you going to do 
with the stimulus money to accelerate cleanup?
    Dr. Triay. The stimulus money will be used to deal with 
those deferred projects that constituted the portfolio of 
accelerated cleanup at some of these other sites. We are going 
to ensure that we reduce the footprint at our two largest 
sites--Hanford as well as Savannah River Site--by between 45 
and 55 percent. We are going to ensure the disposition of 
thousands of cubic meters of transuranic waste and low-level 
waste. In addition to that, we are going to deal with some of 
the main issues associated with contaminated soil and 
groundwater.
    In my testimony, in particular, I talk about Idaho, Oak 
Ridge, Savannah River Site, and Hanford. If you actually look 
at the majority of our life-cycle costs, it deals with Savannah 
River Site, Hanford, Idaho, and Oak Ridge. At the Savannah 
River Site, we are going to be closing major contaminated areas 
and two nuclear reactors. We also think that it is imperative 
that, if we are able to reduce the footprint, we will see 
reductions to our surveillance and maintenance costs. In other 
words, the cost of opening the doors every morning and being 
able to maintain the complex in a safe and secure posture.
    So, I believe, Senator, that you're not going to be 
disappointed with the dramatic amount of decontamination and 
decommissioning that is going to be done with the Recovery Act 
funding and with the amount of waste that is going to be 
dispositioned.
    Senator Bill Nelson. Back on the jobs, do you have an 
estimate of the new jobs that are created by the stimulus bill, 
how many are going to be Federal and how many in the private 
sector?
    Dr. Triay. With respect to the Federal jobs, we are going 
to be hiring on the order of 90 individuals, 90 employees, into 
the Federal workforce. The rest of up to the 13,000 jobs are 
going to be in the commercial sector.
    Senator Bill Nelson. Now, after the stimulus bill money is 
over, which is in a couple of years, what happens to those 
jobs?
    Dr. Triay. What we had in mind was to partner with the 
energy sector of the DOE. So, essentially--part of our vision 
in proposing this dramatic decrease in the footprint was to 
have vast tracts of land that would be cleaned up and would 
become an asset to that particular community. We in the EM 
Program are focused on the cleanup; however, there are other 
parts of the DOE that are focused on energy, and other parts 
that are focused on other missions, like science, like other 
parts of defense. So, we thought that, by cleaning up these 
vast tracts of land, we would then be able to put this resource 
on the table for ideas, such as, for instance, energy parks in 
the different sites that now those lands we're in, and then 
ready for beneficial reuse. So, our thought was, by doing that 
amount of footprint reduction, we would be able to give the 
communities the opportunity to use the infrastructure, very 
well-trained workforce, as well as the ability, based on a lot 
of geohydrological characterization of those sites over the 
years, to explore, even within the Department or outside the 
Department, in a totally commercial venture, the opportunity to 
continue with those jobs past the 2\1/2\ years, because then 
those vast cleaned-up tracts of land will become an asset to 
the community.
    Senator Bill Nelson. Okay. Now, at the same time that 
you're dealing with the stimulus money, you have to handle and 
manage your own regular cleanup activities. How are you going 
to do both of them together?
    Dr. Triay. We have stood up an office for the Recovery Act 
funding. As a matter of fact, the Program Manager, Cynthia 
Anderson, was a Federal Project Director at South Carolina, as 
I was saying; Frazier Lockhart was Federal Project Director of 
Rocky Flats. So, we have very good talent. But, in addition to 
that, the EM Program, in 2007, was at 1,370 employees. Today we 
have hired and extended more offers so that we increased our 
employees essentially by 300, to 1,680. That doesn't count the 
90 individuals that we're going to hire specifically for 
economic recovery. So, we're going to have an increase on the 
order of 400 employees between 2007 and today.
    We believe that we are going to be very demanding customers 
of these economic recovery activities, and that we're well-
poised--we have high-level individuals in the areas of science 
and engineering, but also acquisition and project management. 
In the area of project management and contract management, in 
particular, we essentially have increased by 116 employees. In 
addition to the Federal employees, we have partnered with the 
U.S. Army Corps of Engineers so that they can also provide 
augmentation to the Federal employees that are in the EM 
Program. We have over 50 individuals deployed from the U.S. 
Army Corps of Engineers and their contractors, so that we can 
strengthen project management and contract management, in 
addition to the strengthening that we have done of our own 
Federal staff.
    Senator Bill Nelson. It's your intention to obligate the 
rest of this money within the next 5 months, and to have the 
work completed in 2\1/2\ years, by the end of 2011. Yet, we've 
seen that's what's gotten us into a fix in the past, where we 
do these accelerated projects. So, what is your plan to develop 
realistic baselines or milestones for each of these stimulus 
bill projects?
    Dr. Triay. Cost, scope, and schedule baselines have been 
developed for 90 percent of the portfolio before the Recovery 
Act. As part of this increase of 300 employees in the EM 
Program, we have stood up a cost estimating group in our 
Consolidated Business Center for Independent Government 
Estimates, and we're going to have the Office of Engineering 
and Construction Management continue to perform independent 
audits of all of our baselines, including the baselines that 
are associated with this work.
    As I was saying before, in this case, in addition to having 
realistic baselines to start the work, we're going to have 
independent verifications before we allow the contractors to 
cost work at 20 percent intervals. That will require not only 
the EM Program, but the Office of the Chief Financial Officer. 
We are extremely aware of the fact that we need to perform, 
that we have to ensure that we use this money effectively, and 
the baselines that are going to be put in place are going to be 
realistic, they're going to have independent auditing of their 
degree of integrity, and we're going to have risk management 
plans so that we identify the vulnerabilities that we have 
associated with the work, and that we are vigilant about 
dealing with those risks before we commit further dollars that 
can be costed against the Recovery Act activities.
    Senator Bill Nelson. Thank you, Dr. Triay.
    Senator Begich, will you adjourn the meeting when you're 
through with your questions?
    Senator Begich. That would be fine, Mr. Chairman.
    Senator Bill Nelson. I'm going to slip out to another 
appointment.
    Dr. Triay, thank you. You came very well-prepared. I want 
to commend you. If you would, go ahead and introduce your 
colleagues that you said you wanted to, and we'll make it part 
of the record.
    Dr. Triay. Thank you, sir.
    Cynthia Anderson is the program manager for the Recovery 
Act, and she was a Federal Project Director from South 
Carolina, from the Savannah River Site. Frazier Lockhart was 
the Federal project director that pushed closure of Rocky 
Flats, highest-level certification from the DOE. I would also 
like to introduce Merle Sykes, who's the Deputy Assistant 
Secretary responsible for the life-cycle cost as well as the 
strategic planning associated with the EM Program.
    Senator Bill Nelson. Okay, thank you.
    Senator Begich.
    Senator Begich [presiding]. Thank you very much, Mr. 
Chairman. I'll be brief, I just have a couple of quick 
questions.
    I might have missed this, so if you could clarify this, if 
I got the number right. With the stimulus bill, in the 11,000 
to 12,000 or so, private contractor employees, there's about 
90, give or take a few, that will enter your agency as agency 
employees. Is that correct?
    Dr. Triay. Yes. Ninety additional Federal employees.
    Senator Begich. Okay. Right. So, as the stimulus winds 
down, in 2-plus years--2, 2\1/2\ years--these 90 employees are 
intended to stay on, because you believe there's additional 
responsibilities and work for them in the future. Is that what 
I understand? Or, potentially could be?
    Dr. Triay. Potentially. The National Academy of Public 
Administration published a report in 2007 indicating that the 
EM Program needed to increase their staff, from 1,370, by 200, 
immediately. They had done some benchmarking on comparable 
industries, such as the National Aeronautics and Space 
Administration, being one of the main comparable industries to 
the EM type of projects. They indicated that, at some of those 
other agencies, we would have two to six times the oversight 
that we have in the EM Program.
    So, the EM Program really has, in the past several years, 
been understaffed when it comes to oversight. GAO, other 
bodies, have heavily criticized our performance in our 
projects, and, in particular, the oversight that we have 
provided to project management and contract management. We 
think that those 90 individuals would probably have an 
opportunity to continue to work in EM.
    Senator Begich. So, you anticipate--would it be the 2011 or 
2012 budget that you would see an increment in order to provide 
continual funding for those 90? Because, in theory, the 
stimulus money runs out; these people are temporary full-time, 
by definition.
    But, your point is that they could be utilized in the 
future, so you would see an increment in 2012?
    Dr. Triay. In terms of program direction, which is the 
account where those monies would come from, as I was stating 
before, we have augmented our Federal staff from other 
agencies, such as--the U.S. Army Corps of Engineers has over 50 
individuals that, through their own contractors, have been part 
of our efforts to improve our projects and our contracts. So, 
in terms of a bottom-line increase of the dollar amount, that 
is not a given. In other words, we can't, within the account, 
make sure that we mentor some of our own Federal employees to 
take over, that assistance that is being provided to us from 
others that have had more success and are more experienced in 
project management and contract management.
    Senator Begich. I understand. But, in order to do that--and 
I would just give you a cautionary flag on the Corps, because 
we do a lot of business in Alaska with the Corps; they have $4+ 
billion in the stimulus bill that they have to manage. I have 
concerns over their capacity to manage that. They're taking 
similar steps, as you of managing existing projects, they don't 
want to create new projects, and so forth, which I commend them 
for that. It's very specific in the stimulus bill how we 
detailed how the Corps could do projects, or not, with the 
stimulus money. So, a little flag of caution there, only 
because their capacity is in question.
    But, saying that, when you mentor up your folks to then 
supplant what the Corps was doing, I guess my question is, is 
it 2011 or 2012 that you have to have an increment; you can't 
just--90 people added to your payroll, it comes from somewhere.
    Dr. Triay. Right.
    Senator Begich. That's all I'm saying.
    Dr. Triay. All I was trying to say is that it may not be 
necessarily straight math, that we need to add 90 individuals 
times $140,000 per year and that that is a straight math of how 
the program direction dollars are going to increase in 2012. 
Obviously it would be in 2012.
    Senator Begich. Understood. But, 2012 is approximately?
    Dr. Triay. Yes, it's approximate, yes.
    Senator Begich. Okay.
    Dr. Triay. Yes.
    Senator Begich. Then, two quick ones. On the chart on page 
79, which is a great summary, when I look at the high and low, 
just so I understand how you've done this, over the life span 
of the project, then those are inflation-adjusted or are they 
in today's dollars?
    Dr. Triay. The life-cycle cost is escalated, the ones that 
are here on page 70.
    Senator Begich. Okay.
    Dr. Triay. Just so that you know, in terms of the ranges of 
the years--some of them that you were reading the ranges of the 
funding, the life-cycle cost funding, it goes from a 50 percent 
confidence level to 80 percent confidence level.
    Dr. Triay. That range comes from that.
    Senator Begich. That's great. What I just wanted to make 
sure, what has the greatest bearing on this number, on these 
numbers, is if you got additional increments above what you've 
projected, which is $5.5 to $6 billion, this number has a 
potential of going to the lower spectrum. I just want to make 
sure we're on the same page.
    Dr. Triay. Absolutely.
    Senator Begich. Okay.
    Dr. Triay. Absolutely. That is why I was telling, I 
believe, Senator Sessions----
    Senator Begich. Senator Graham.
    Dr. Triay. --that 40 percent----
    Senator Begich. Yes, Sessions and Graham.
    Dr. Triay. --over the life-cycle cost was when we adjusted 
the funding per year down to about between $5.5 and $6 billion, 
we had to move the activities to the right, and therefore, the 
escalation of the dollars caused 40 percent of the increase in 
life-cycle.
    Senator Begich. In that life-cycle change, that 40 percent 
number that you've identified--and I might have not heard you 
correctly earlier--the old estimate was $7.5 billion, $8 
billion per year? Is that right? Am I right, in that range?
    Dr. Triay. That is correct.
    Senator Begich. So, the increment of $1.5 to $2 billion has 
an impact of 40 percent. Let me rephrase that--$1.5 billion to 
$2 billion per year has an increment increase of 40 percent on 
these projects.
    Dr. Triay. That is correct.
    Senator Begich. Am I saying that right? I just want to make 
sure I get it right.
    Dr. Triay. That is exactly correct.
    Senator Begich. I'm trying to keep the math as simple as I 
can manage it, dealing with nuclear energy and so forth. So, 
I'm just trying to keep it in my mind.
    That helps a lot, because what it argues is, if you can 
adjust up the budget over time, back to that number, making it 
more realistic, the amount of money, potential savings, is 
huge. I mean, in theory.
    Dr. Triay. That is true, in theory.
    Senator Begich. Yes.
    Dr. Triay. Of course you know, Senator, that there are 
economic realities----
    Senator Begich. Sure.
    Dr. Triay. --and that we need to do our part to allow other 
parts of the Federal Government to do their job effectively, as 
well.
    Senator Begich. I appreciate that. I thank you.
    The last question--or, actually, two quick ones. You 
mentioned, with the contractors, you have a lot of small-
business component--or potential small-business component. Do 
you keep track of your disadvantaged business enterprises 
(DBE), or your disadvantaged business percentage on these 
contracts and what participation? If so, could I get that, at 
some point? I don't need that right now, but--of the contracts 
that you have--that are going to be extended, let me put it 
that way--stimulus only. The ones that will be added to and 
modified for the purpose of stimulus, what percentage of DBE, 
or disadvantaged business, or minority-owned businesses, have 
part of that business? Can you get that to us?
    Dr. Triay. Absolutely. We will definitely do that. We keep 
track of it. The EM Program is very successful, actually, in 
having small business do a major part of our work. So, we will 
definitely give you that information.
    [The information referred to follows:]

    As we implement the American Recovery and Reinvestment Act 
(Recovery Act), the Office of Environmental Management's (EM) objective 
is to meet or exceed existing socioeconomic goals of 4.8 percent for 
prime contract obligations to small businesses. For work subcontracted 
by our prime contractors, an additional goal is to have 5 percent 
subcontracted to small disadvantaged businesses. Our experience is that 
many prime contractors will subcontract work to small businesses, 
generally in excess of 20 percent of our total contract dollars; and, 
given the nature of Recovery Act work, this percentage could be higher. 
Our fiscal year 2008 results support these projections: total small 
business funding was in excess of $1.4 billion (26.2 percent of EM's 
procurement base), including prime small business prime contract 
funding of $327 million (6.1 percent) and small business subcontract 
funding of approximately $1.1 billion (20.6 percent).

    Senator Begich. That'd be great.
    The last question, and then I'll close off the meeting, and 
that is, of the amounts that you get on the--again, now let's 
put stimulus aside--the $5.5 to $6 billion, that you roll 
through on an annualized basis--of that--not what is obligated, 
but what is actually expended in work per year--do you have a 
number that you could share with me now, or maybe, again, at a 
later time, the last 4 years of--not what was obligated, but 
actually expended in actual completion work? Is there such a 
number that you might have available?
    Dr. Triay. I'm having Merle Sykes identify herself and come 
to the table, but I believe that that number is 80 percent. 
But, by all means, Merle, please.
    Senator Begich. About 80 percent. So, about $4.8 billion, 
give or take a little bit there, because your number may vary--
is actually expended on contractual and/or work completed 
regarding--or in relation to these projects. Then 20 percent is 
obligated for work that may occur 12, 14, 16, 18 months out, or 
whenever that obligation period is.
    Dr. Triay. That is correct.
    Senator Begich. Okay. Great. Thank you very much. As a new 
member, I appreciate allowing me to ask a few questions, some 
of them very naive, but learning a little bit more about the 
process.
    I need to adjourn the meeting, but I want to make sure it's 
noted for the record that the record will remain open until 
Monday night for additional questions for the record.
    I just want to, again, thank you and your staff for all the 
work you've done.
    Dr. Triay. Thank you, Senator.
    Senator Begich. This meeting is adjourned. Thank you.
    [Whereupon, at 11:13 a.m., the subcommittee adjourned.]

                                 
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