[House Hearing, 112 Congress]
[From the U.S. Government Publishing Office]



                      ENERGY AND WATER DEVELOPMENT
                        APPROPRIATIONS FOR 2013

_______________________________________________________________________

                                HEARINGS

                                BEFORE A

                           SUBCOMMITTEE OF THE

                       COMMITTEE ON APPROPRIATIONS

                         HOUSE OF REPRESENTATIVES

                      ONE HUNDRED TWELFTH CONGRESS

                             SECOND SESSION
                                ________

              SUBCOMMITTEE ON ENERGY AND WATER DEVELOPMENT

              RODNEY P. FRELINGHUYSEN, New Jersey, Chairman

 JERRY LEWIS, California            PETER J. VISCLOSKY, Indiana
 MICHAEL K. SIMPSON, Idaho          ED PASTOR, Arizona
 DENNY REHBERG, Montana             CHAKA FATTAH, Pennsylvania
 RODNEY ALEXANDER, Louisiana        JOHN W. OLVER, Massachusetts
 STEVE WOMACK, Arkansas             
 ALAN NUNNELEE, Mississippi         

 NOTE: Under Committee Rules, Mr. Rogers, as Chairman of the Full 
Committee, and Mr. Dicks, as Ranking Minority Member of the Full 
Committee, are authorized to sit as Members of all Subcommittees.

                Rob Blair, Joseph Levin, Angie Giancarlo,
                  Loraine Heckenberg, and Perry Yates,
                            Staff Assistants

                                ________

                                 PART 8

                NATIONAL NUCLEAR SECURITY ADMINISTRATION

                                                                   Page
 Energy Weapons Activities........................................    1
 Defense Nuclear Nonproliferation and Naval Reactors..............  127

                                   

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                                ________

         Printed for the use of the Committee on Appropriations










                      ENERGY AND WATER DEVELOPMENT
                        APPROPRIATIONS FOR 2013

_______________________________________________________________________





                                HEARINGS

                                BEFORE A

                           SUBCOMMITTEE OF THE

                       COMMITTEE ON APPROPRIATIONS

                         HOUSE OF REPRESENTATIVES

                      ONE HUNDRED TWELFTH CONGRESS
                             SECOND SESSION
                                ________
              SUBCOMMITTEE ON ENERGY AND WATER DEVELOPMENT
              RODNEY P. FRELINGHUYSEN, New Jersey, Chairman
 JERRY LEWIS, California            PETER J. VISCLOSKY, Indiana
 MICHAEL K. SIMPSON, Idaho          ED PASTOR, Arizona
 DENNY REHBERG, Montana             CHAKA FATTAH, Pennsylvania
 RODNEY ALEXANDER, Louisiana        JOHN W. OLVER, Massachusetts
 STEVE WOMACK, Arkansas             
 ALAN NUNNELEE, Mississippi         

 NOTE: Under Committee Rules, Mr. Rogers, as Chairman of the Full 
Committee, and Mr. Dicks, as Ranking Minority Member of the Full 
Committee, are authorized to sit as Members of all Subcommittees.
                Rob Blair, Joseph Levin, Angie Giancarlo,
                  Loraine Heckenberg, and Perry Yates,
                            Staff Assistants



                                 PART 8

                NATIONAL NUCLEAR SECURITY ADMINISTRATION

                                                                   Page
 Energy Weapons Activities........................................    1
 Defense Nuclear Nonproliferation and Naval Reactors..............  127



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                                ________

         Printed for the use of the Committee on Appropriations
                                ________

                     U.S. GOVERNMENT PRINTING OFFICE

 79-351                     WASHINGTON : 2012











                        COMMITTEE ON APPROPRIATIONS

                    HAROLD ROGERS, Kentucky, Chairman

 C. W. BILL YOUNG, Florida \1\           NORMAN D. DICKS, Washington
 JERRY LEWIS, California \1\             MARCY KAPTUR, Ohio
 FRANK R. WOLF, Virginia                 PETER J. VISCLOSKY, Indiana
 JACK KINGSTON, Georgia                  NITA M. LOWEY, New York
 RODNEY P. FRELINGHUYSEN, New Jersey     JOSE E. SERRANO, New York
 TOM LATHAM, Iowa                        ROSA L. DeLAURO, Connecticut
 ROBERT B. ADERHOLT, Alabama             JAMES P. MORAN, Virginia
 JO ANN EMERSON, Missouri                JOHN W. OLVER, Massachusetts
 KAY GRANGER, Texas                      ED PASTOR, Arizona
 MICHAEL K. SIMPSON, Idaho               DAVID E. PRICE, North Carolina
 JOHN ABNEY CULBERSON, Texas             MAURICE D. HINCHEY, New York
 ANDER CRENSHAW, Florida                 LUCILLE ROYBAL-ALLARD, California
 DENNY REHBERG, Montana                  SAM FARR, California
 JOHN R. CARTER, Texas                   JESSE L. JACKSON, Jr., Illinois
 RODNEY ALEXANDER, Louisiana             CHAKA FATTAH, Pennsylvania
 KEN CALVERT, California                 STEVEN R. ROTHMAN, New Jersey
 JO BONNER, Alabama                      SANFORD D. BISHOP, Jr., Georgia
 STEVEN C. LaTOURETTE, Ohio              BARBARA LEE, California
 TOM COLE, Oklahoma                      ADAM B. SCHIFF, California
 JEFF FLAKE, Arizona                     MICHAEL M. HONDA, California
 MARIO DIAZ-BALART, Florida              BETTY McCOLLUM, Minnesota
 CHARLES W. DENT, Pennsylvania           
 STEVE AUSTRIA, Ohio                     
 CYNTHIA M. LUMMIS, Wyoming              
 TOM GRAVES, Georgia                     
 KEVIN YODER, Kansas                     
 STEVE WOMACK, Arkansas                  
 ALAN NUNNELEE, Mississippi              
   
 ----------
 \1\ Chairman Emeritus    

               William B. Inglee, Clerk and Staff Director

                                  (ii)

 
          ENERGY AND WATER DEVELOPMENT APPROPRIATIONS FOR 2013

                              ----------                              

                                      Wednesday, February 29, 2012.

                DEPARTMENT OF ENERGY WEAPONS ACTIVITIES

                NATIONAL NUCLEAR SECURITY ADMINISTRATION

                               WITNESSES

THOMAS D'AGOSTINO, ADMINISTRATOR, NATIONAL NUCLEAR SECURITY 
    ADMINISTRATION
DR. DONALD COOK, DEPUTY ADMINISTRATOR FOR DEFENSE PROGRAMS, NATIONAL 
    NUCLEAR SECURITY ADMINISTRATION
BRIG. GEN. SANDRA E. FINAN, PRINCIPAL ASSISTANT DEPUTY ADMINISTRATOR 
    FOR MILITARY APPLICATION, NATIONAL NUCLEAR SECURITY ADMINISTRATION
    Mr. Frelinghuysen. Good morning. Do not want to catch you 
on your feet. This hearing will come to order. Administrator 
D'Agostino, it is good to have you back again.
    Mr. D'Agostino. Thank you.
    Mr. Frelinghuysen. This will be your sixth year I believe--
--
    Mr. D'Agostino. Yes sir.
    Mr. Frelinghuysen [continuing]. That you have testified 
before the subcommittee, which must be quite a penance to pay 
after your considerable service in our Navy.
    Mr. D'Agostino. Thank you.
    Mr. Frelinghuysen. Welcome back also, Dr. Cook. Thank you 
for being here.
    Mr. Cook. Thank you.
    Mr. Frelinghuysen. General Finan, thank you. Good to see 
you again. I want to thank you all for your service to our 
nation and we look forward to your remarks and your 
participation here this morning. I hold the nuclear security 
enterprise to be the single most important mandate of the 
Department of Energy and certainly the greatest mandate of our 
subcommittee.
    However supportive I am of your mission, it is still the 
responsibility of this committee to take apart and examine 
every budget line, scrutinize it, and ensure the taxpayers' 
dollars are well spent. Last year, that preview of process put 
us at odds with those who felt that our national security 
enterprise simply had to have a much higher level of funding. 
Our final product, however, showed that our strategic security 
could be maintained, and even strengthened with constrained 
resources. This year, as last, we need a credible and 
affordable strategy for maintaining our nuclear deterrent.
    Mr. Administrator, I do not need to remind you that the 
nuclear weapons efforts under your responsibility often entail 
billions of taxpayers' dollars.
    I want to take a moment to note the importance of the 
financial reporting requirements instituted in the fiscal year 
2012 conference report. These are intended to provide this body 
and the taxpayer with a greater level of transparency into the 
full cost of your efforts and the effectiveness of your project 
management. They are also in place to ensure that the entire 
administration, including your organization, the Defense 
Department, the Office of Management and Budget, the Nuclear 
Weapons Council, and others have come to an internal consensus 
on the requirements for your major initiatives. Properly 
followed, these requirements will help build consensus and 
confidence here in Congress. Please take them to heart as you 
and your colleagues develop your work plan for the next few 
years.
    I have heard many speak recently about potential new cuts 
or reductions to our nuclear stockpile, and these reports give 
me great pause. The goal of our nuclear force structure is 
deterrence, preventing any adversary from even thinking that 
they could minimize our attack options.
    We must take great care not to encourage our enemies to 
make foolish decisions. Most importantly, we must make sure 
that the warheads that we now have actually work and work 
reliably. And we have made it our top priority to ensure that 
you have the budgetary resources to do just this. The country 
has placed in your capable hands the responsibility to use 
these resources properly and efficiently.
    I trust today that you and your colleagues will explain to 
the subcommittee that your budget request supports this 
critical goal. Mr. Administrator, please ensure that the 
hearing record, questions for the record, and any supporting 
information requested by the subcommittee are delivered in 
final form to us no later than four weeks from the time you 
receive them.
    Members who have additional questions for the record will 
have until the close of business tomorrow to provide them to 
the subcommittee office.
    With that, I turn to my ranking member, Pete Visclosky, for 
any comments he may have.
    [The information follows:]

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    Mr. Visclosky. Thank you, Mr. Chairman. Mr. Administrator, 
I welcome you before the subcommittee as well as General Finan 
and Dr. Cook. I look forward to hearing your testimony. As you 
all know, I have been an advocate for an enduring 21st century 
strategy for our Nation's nuclear deterrence for some time. I 
was hopeful that the latest Nuclear Posture Review in the 
Section 1251 Complex Modernization Report would be the 
foundation of their strategy.
    However, recent reports indicate that the administration is 
again evaluating a range of options for restructuring our 
nuclear forces. While I support any analysis that will 
contribute to intelligent and informed decision-making, I am 
concerned that we still do not have a contemporary 
comprehensive strategy that will guide us over the next decade 
and beyond.
    Looking ahead, important and resource intensive decisions 
will be necessary regarding the recapitalization of the 
Nation's nuclear deterrence triad, decisions that will drive 
the strategic force for decades to come. I would hope that 
these decisions are driven by policy. I appreciate the work 
that you have done at NNSA. Mr. D'Agostino, in particular, your 
efforts to address the concerns of this subcommittee, you have 
been terrific to work with over the years.
    I appreciate that you have made hard choices in this budget 
request, and the subcommittee will endeavor to understand the 
implications of those choices. However, I am concerned that 
some of the choices call into question the process by which the 
needs of the complex are defined. On several fronts, there are 
changes in direction that I recall previously being an anathema 
to your mission. The Disassembly and Conversion Facility, 
Chemistry and Metallurgical Research Replacement, and the 
changes to the B61 Life Extension Program are examples.
    The challenge these changes present, even for those who 
might support them, is that after years of being told that 
there is only one alternative to address an issue, the NNSA has 
now found a way to obviate or delay the need for the 
requirements. I certainly do hope as the year proceeds that we 
can all work towards a plan for the weapons complex that meets 
the mission's needs and recognizes the challenge of our current 
budget environment.
    I certainly have confidence that you, as well as the other 
panelists, will work diligently to this goal. While this 
hearing is on the weapons program, I would be remiss if I did 
not acknowledge that you now are also responsible for the 
Environmental Management Program in addition to NNSA. That must 
be the meeting you did not attend.
    With this reorganization you now own the vast majority of 
large operating and construction projects within the 
department. And I will make a point to you that I made 
yesterday to the secretary. If strong leadership and 
fundamental management reform are not forthcoming, it will 
significantly inhibit the opportunity to exercise your mission 
as well as the department's credibility. And certainly 
predating the change in responsibility from your tenure, 
serious issues involving nuclear safety at the waste treatment 
plant have come to light, yet the department has been slow to 
accept the extent in implications of those problems.
    What began as technical and project management issues have 
festered until they now become embedded in the safety culture 
of the project. The latest report from DOE's Office of Health, 
Safety, and Security confirms the extent of the problems and 
informs us that the situation has continued to deteriorate. And 
again, most of this precedes the change in responsibility. I 
will certainly ask that you work hard to ensure that federal 
management can foster a positive nuclear safety culture.
    And with that, again, we thank you and the other witnesses. 
Thank you Mr. Chairman.
    [The information follows:]

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    Mr. Frelinghuysen. Thank you, Mr. Visclosky. Mr. 
D'Agostino, the floor is yours.
    Mr. D'Agostino. Chairman Frelinghuysen, Ranking Member 
Visclosky, members of the committee, good morning and thank you 
for having me here to discuss the President's fiscal year 2013 
request. Your ongoing support for the men and women of the NNSA 
and the work they do and your bipartisan leadership on some of 
the most challenging national security issues of our time, has 
helped keep America safe, helped protect our allies, and 
enhanced global security. Earlier this month, President Obama 
released his budget for fiscal year 2013. As you know, due in 
part to the constraints established by the Budget Control Act, 
this is a time of fiscal austerity.
    I want to assure you that the NNSA is being thoughtful, 
pragmatic, and efficient in how we achieve the President's 
nuclear security objectives and shape the future of our nuclear 
security. We have continuously improved the way we operate and 
we are committed to doing our part in this constrained budget 
environment. In April of 2009, in Prague, the President shared 
his vision for a world free from the threat of nuclear 
terrorism and united in our approach to our shared nuclear 
security goals.
    His 2013 request is $11.5 billion, which is an increase of 
536 million over the fiscal year 2012 appropriation. The 
request reaffirms our commitment to building a 21st century 
nuclear security enterprise through innovative approaches to 
some of our greatest challenges and key investments in our 
infrastructure. For example, we are continuing our critical 
work to maintain the Nation's nuclear stockpile and ensuring 
that as long as those weapons exist, that they are safe, 
secure, and effective.
    The 2013 budget provides 7.58 billion for our weapons 
activities account to implement the President's strategy in a 
coordination with our partners at the Department of Defense. 
The President continues to support our Life Extension Programs, 
including funding for the B61-12 activities. He has also 
requested increase funding for our stockpile systems to support 
the W78 and the W88 life extension study, which we discussed 
with you last year.
    Our request for investments in the science, technology, and 
engineering that supports NNSA's missions will ensure that our 
national security laboratories continue to lead the world in 
advanced scientific capabilities. For over a decade, we have 
been building the tools and capabilities needed to take care of 
the stockpile. We are now entering into a time when NNSA will 
fully utilize these analytical tools and capabilities towards 
maintaining a safe, secure, and effective stockpile, and 
performing the necessary life extension work.
    These capabilities also provide the critical base for 
nonproliferation and counterterrorism work, allowing us to 
apply our investments to the full scope of our mission. The 
budget also reflects its commitment towards completing key 
dismantlements with $51.3 million requested in 2013 to continue 
reducing the number of legacy nuclear weapons retired from the 
stockpile.
    NNSA has previously committed to completing the 
dismantlement of all warheads retired as of 2009 and completing 
this job by 2022. In fact, in fiscal year 2011, NNSA completed 
the dismantlement of the last B53 nuclear bomb, one of the 
largest ever built, ahead of schedule and under budget. We also 
eliminated the last components of the W70 warhead, which was 
originally in the U.S. Army's arsenal.
    To support our stockpile and provide us with world class 
capabilities, we need to modernize our Cold War era facilities 
and maintain our expertise in uranium processing. This budget 
includes $2.24 billion to maintain our infrastructure and 
execute our construction projects.
    As you know, our deterrent is only one part of NNSA's 
mission. 2013 will continue to see us advance the President's 
four-year goal to secure vulnerable material around the world, 
and the budget request provides $2.46 billion we need to 
continue critical nonproliferation efforts.
    This budget also gives us the resources we need to maintain 
our one of a kind emergency response capabilities, which allow 
us to respond to nuclear or radiological emergencies anywhere 
in the world, support our Navy through Naval Reactors Program, 
and anticipate the future of counterterrorism and counter-
proliferation programs.
    Now, I have told you a lot about our plans and our budget 
today, and I also want you to know that we are committed to 
being responsible stewards of taxpayer dollars. We have taken 
steps to ensure that we are building the capabilities based 
enterprise. We view this constrained budget environment as an 
additional incentive to ask ourselves how we can re-think the 
way we are operating, how we can innovate, and how we can get 
better.
    For example, as you mentioned earlier, we are adjusting our 
plutonium strategy by deferring construction of the Chemistry 
and Metallurgy Research Replacement Facility, the nuclear part 
of the project, and focusing instead on how we can meet our 
plutonium needs on an interim basis by using capabilities and 
expertise found at existing facilities. Of course this entails 
additional risk, but we feel this risk can be accepted in this 
case. Deferring the nuclear facility portion will have an 
estimated cost avoidance from 2013 to 2017 that totals over 
$1.8 billion, which will help offset the cost of other 
priorities such as life extension programs. We are not resting 
on all ideas to solve tomorrow's problems. We are shaping the 
future of our nuclear security and we are doing it in a 
fiscally responsible way.
    Budget uncertainty adds cost and complexity to how we 
achieve our goals. You have been very supportive of our efforts 
in the past. I ask you again for your help in providing 
stability. We need to do our job efficiently and effectively. I 
would also like to acknowledge that I have come before you in 
the past and talked at length about how NNSA has been working 
to change the way we do business.
    I am proud of the work the men and women of the NNSA have 
done to come together and operate as one organization. We are 
defining ourselves as a fully integrated enterprise that 
operates efficiently, is organized to succeed, and performs its 
work seamlessly, and, more importantly, speaks as one voice. 
This is a continuing challenge, but is something that we are 
focused on. We work to improve everywhere from our government's 
model to our network infrastructure, from contracting processes 
to leadership and development programs. We are improving 
business processes by implementing ISO 9001 standard and 
looking forward to the future through workforce analysis and 
improving efficiency through consolidated contracts.
    We have taken other significant steps to continue improving 
from top to bottom. For example, we have created an acquisition 
and project management organization to help institutionalize 
our commitment to improving the way we do business. This move 
will improve the quality of our work, while keeping our 
projects on time and on budget. We are also improving the way 
we work with our partners across at the Department of Energy.
    And in my role as the under secretary of energy for nuclear 
security, I have made better coordination between--with the 
Office of Environmental Management and the Office of Legacy 
Management and the NNSA, a key focal point, and I think we have 
some wonderful opportunities there to drive better integration 
across the department, and I will be happy to take questions on 
that at that point. I am proud of what we have been able to 
accomplish so far, and I am excited about what we can 
accomplish next.
    Thank you for having me today, and I look forward to your 
questions.
    [The information follows:]

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    Mr. Frelinghuysen. Thank you. Anything for the record, 
General Finan?
    General Finan. No, sir.
    Mr. Frelinghuysen. Dr. Cook?
    Mr. Cook. No, sir.
    Mr. Frelinghuysen. Okay. Mr. Administrator, during the 
rollout of your fiscal year 2013 budget request, you stated 
that Congress had handed you, and I quote, ``less than half of 
the increase you need to do the job,'' end of quotation marks. 
This is not the first time we have heard complaints from the 
Administration that funding increases supported by Congress, 
developed with strong bipartisan and bicameral support within 
the Appropriations Committee, indicate that there is a lack of 
support in Congress for maintaining the stockpile.
    The truth is that the life extension programs were fully 
funded in the Conference Agreement, as were the increases 
requested for infrastructure and maintenance, construction of 
the Uranium Processing Facility, and the design of the CMRR. 
Though it now appears at least some of this investment may no 
longer be needed. The top line debate on overall spending 
levels has not been constructive with solving the real 
challenge of creating a credible and affordable plan to 
maintain an aging stockpile.
    We need to continue the process that began with the Nuclear 
Posture Review, and that is still evolving to look closely at 
our programs and make the right decisions to ensure that the 
health of this incredibly important complex. Mr. Administrator, 
does your budget request for fiscal year 2013 fully meet your 
requirements to maintain the stockpile?
    Mr. D'Agostino. Mr. Chairman, it absolutely does. It fully 
meets the requirements and we will be able to take care of the 
stockpile, do the annual assessments that we need to do, 
commence the life extension work that the Nuclear Weapons 
Council has recently approved on the B61-12, as well as take 
care of the scientific and technical infrastructure that is so 
critical in order to evaluate the surveillance data that we get 
from the stockpile. So the stockpile is safe, secure, and 
reliable.
    Mr. Frelinghuysen. So the comments that I referenced during 
the rollout were inaccurate?
    Mr. D'Agostino. No, no, that was a partial quote out of a 
much longer answer. The question that I had received at that 
time was the President does not appear to be committed to 
taking care of the stockpile because he is asking for less 
money. In fiscal year 2013, then, what we had asked for that 
was evident in the fiscal year 2012 budget and so in that case 
what we--the full answer actually was it was a reflection of 
the fact that we have an fiscal year 2012 appropriation that is 
less than what we had asked for, for our original plan.
    We have heard the voice of Congress, we have adjusted our 
plans accordingly focusing on the most important things, and it 
was a--for the broader part of that answer obviously was not--
did not make the weapons complex----
    Mr. Frelinghuysen. So you are able to meet your 
requirements to maintain the stockpile in 2012 at the levels we 
appropriated?
    Mr. D'Agostino. Absolutely.
    Mr. Frelinghuysen. For the record.
    Mr. D'Agostino. Yes, sir. Yeah, the fiscal year 2012 
appropriation, which is a significant increase and we 
recognized that the committee appropriated a significant 
increase, a 5 percent increase from the fiscal year 2011 
numbers, it was different than our original plan. We changed 
our plan accordingly and in addition to the fact that we have 
also--we are illuminated by the Budget Control Act piece of 
this, which also came into play. That is why we will see some 
significant differences between what we had presented last year 
and what we have coming out this year.
    Mr. Frelinghuysen. What assurances can you provide that 
this administration is up to the task of developing an 
affordable plan for maintaining the stockpile? And can you meet 
this challenge even in the constrained budget environment that 
we are in?
    Mr. D'Agostino. The assurance is that I feel strongly that 
we can meet the challenge as a--even in a constrained budget 
requirement. What it will do, though, it will provide us an 
opportunity to re-examine the way we are doing business. We 
know we can always get better, from a management side. We know 
there are significant opportunities that the fiscal environment 
provides very difficult problems from our original plan. So, 
the way to do the job in a constrained environment is to change 
the way you do business.
    Mr. Frelinghuysen. There were problems without the 
constrained fiscal environment.
    Mr. D'Agostino. Absolutely. We recognize there were 
problems then, but the constrained fiscal environment, frankly, 
gives----
    Mr. Frelinghuysen. Even puts more pressure on you?
    Mr. D'Agostino. Puts more pressure, and I frankly think 
that it gives me an opportunity. It provides--there is a term 
that is used in people who study how to change organizations 
called burning platform. It indicates that in order to affect 
real change in an organization, there needs to be a burning 
platform. A time constraint which basically says, you know, if 
we do not do something different we are not going to be able to 
do our job, and I believe that the fiscal challenges that the 
country is facing provides that burning platform to 
dramatically change the way we do business. And so, we are 
looking at a number of options on how we can change the way we 
do business. It does not mean we were not doing it before, sir.
    Mr. Frelinghuysen. Yes. Well, yours is a very special 
mission.
    Mr. D'Agostino. Yes, sir.
    Mr. Frelinghuysen. And one which we take very seriously, as 
I am sure you do. Mr. Visclosky.
    Mr. Visclosky. Thank you, Mr. Chairman. Mr. Administrator, 
I do appreciate the posture of your view and the proposals that 
were set forth in '10, but we are talking about adjustments 
being made looking ahead to the future.
    When do you think those decisions are going to be 
solidified?
    Mr. D'Agostino. Well, we----
    Mr. Visclosky. Recognizing the world changes tomorrow, as 
it obviously has since '10.
    Mr. D'Agostino. Right.
    Mr. Visclosky. But I put a lot of stock and appreciate the 
fact that the strategy was evolved.
    Mr. D'Agostino. Right.
    Mr. Visclosky. But in two years now we are back changing 
again.
    Mr. D'Agostino. Right. I think what we have is--let me 
answer the first question first and then I might add something. 
I would also ask if you would like, to let Don maybe add 
something, let Dr. Cook add something.
    We are going to be working very closely with the Defense 
Department on our out year program because the committee 
recognizes, we recognize that these are not just one-year 
activities. The fiscal year through 2013 request will allow us 
to do the life extension programs that we have laid out 
previously. The pace of the life extensions will be slower. We 
will slow down that pace in order to free up resources, in 
order to focus on what we believe is our most significant 
challenge, which is to take care of the B-61 and do the life 
extension on that warhead itself.
    So while there have been adjustments to the plan, the 
adjustments reflect the fact that an $88 billion investment 
over a 10-year period, given the budget control acclimations, 
will be very difficult to have authorized and appropriated, 
just given these particular challenges. So, we are working 
these changes in conjunction with the Defense Department.
    Mr. Visclosky. Is that the reason the administration was 
unable to fulfill the statutory requirement to submit to 
Congress a five-year plan?
    Mr. D'Agostino. Our budget actually presents a five-year 
layout, but what we will be following up with shortly is what 
is, you know, the 1251 report; I think the number is now 1043, 
if that is right. Is that right, Don?
    Mr. Cook. It is.
    Mr. D'Agostino. The 1251 report will be forthcoming shortly 
that lays out the five-year effort, and it will likely start 
with the commitments on the five-year effort on the Defense 
Department and will describe in detail how we are going to 
integrate the NNSA or Department of Energy piece into that.
    Mr. Visclosky. Any sense on the timeframe of that?
    Mr. Cook. The timeframe on that. I understand the DOD 
portion to be provided somewhere within the next month. The 
Department of Energy NNSA portion will be provided in a 
timescale which is about July. We have, after the decision by 
the Nuclear Weapons Council on the B-61, agreed that NNSA and 
cost assessment and program evaluation portion of DOD, CAPE as 
it is known, would do a joint study that would provide full 
support understanding of cost not only the B-61, but of key 
areas in the Weapons Activities program that we have.
    Mr. Visclosky. Given that it would be our desire to a bill 
that has been passed by the House of Representatives by then, 
what I understand that whatever elements are in that five-year 
plan are not going to have an impact on your '13 request?
    Mr. Cook. Let us see. There will not be an impact on '13. 
The work that we will do over the summer has really shaped that 
'14 through '18. That is where the focus will be. The work that 
we are doing on CAPE and the requirement associated with the 
Nuclear Weapons Council decision is that we have and set a 
formal baseline for life extensions. So it is focused 
immediately on the B-61 '12 life extension, but we have been 
comprehensively, as the administrator said, scrubbing 
everything in our program, looking at it. I am sure you will 
have questions on the plutonium strategy, the uranium strategy, 
quite a number of warhead life extension programs, as well as 
science and other infrastructure. So, nothing has been off the 
table for review.
    Mr. Visclosky. Okay. Thank you, Mr. Chairman.
    Mr. Frelinghuysen. Thank you, Mr. Visclosky. Mr. Simpson.
    Mr. Simpson. Thank you, Mr. Chairman. First, thank you for 
taking several of us to Los Alamos and Sandia and the Nevada 
test site last March. So, we appreciate it. It was very 
educational for those of us that went, and I think we learned a 
lot on the trip.
    Now for something completely different. You have taken on 
some new responsibilities as we have reorganized NNSA and it 
has now adopted the EM program. The fear was, or the concern, I 
should say, of some members was that EM would get lost within 
NNSA.
    Tell me how the reorganization is going, what you 
anticipate for EM, and how you are overseeing the EM program 
now.
    Mr. D'Agostino. Absolutely. Well, I can assure you the EM 
program is not lost. I absolutely love this additional work. I 
mean that sincerely, because it is always nice to get a fresh 
look at----
    Mr. Simpson. You are the first in the program to have said 
that.
    Mr. D'Agostino. Well, I do mean it. I think what is great 
here--first of all, let me answer your question directly so we 
can get that on the record. We have got a wonderful team. Dave 
Huizenga is heading up this effort; Tracy Mustin, who also came 
from our program. Dave and Tracy came from the EM previously. 
They have proven themselves to manage both in EM, and they have 
taken on the large challenge of securing the material 
worldwide, which they were responsible for the President and 
are back in the EM program.
    They have made a few organizational changes. The key is 
clarity of what you are supposed to do and when you are 
supposed to do it and who is supposed to do it, and this is 
always a challenge in large, complex organizations, is to 
answer those three pieces correctly. Dave and Tracy have laid 
that out.
    I spent a fair amount of time on the EM program itself and 
I can do that because I have Neile Miller as my principle 
deputy in my office. She is a Senate-confirmed, Presidentially 
appointed individual who has great experience in the nuclear 
programs and she is essentially the chief operating officer and 
insures working on the day-to-day. And additionally, I have Don 
Cook and Ann Harrington also running their respective programs 
in the NNSA side.
    So the NNSA management, even though we know we can improve 
and I have got challenges there, is fully staffed, so I can 
devote a fair amount of time to EM.
    One of the things that I am focused on is looking for 
synergistic opportunities where now that these two 
organizations are reporting to one office on how we can work 
better together. One area, a very clear example of this, is 
taking a look--Mr. Chairman, you mentioned the plutonium 
disposition capability, PDCF. We have shifted off of that 
strategy because what we have looked at doing is taking full 
advantage of the H Canyon, which is down in South Carolina. And 
so we are taking a look. We have been able to come up with a 
strategy that maximizes the use of H Canyon, maximizes the 
capabilities up at Los Alamos to get this plutonium oxide 
together, and also make changes in the MOX facility itself. And 
to do all of those things together requires fairly significant 
coordination with EM.
    Also, EM has picked up on our supply chain management 
center. The concept, this is a change where we have looked at 
bulk purchasing and bulk buying of things together within the 
NNSA. We have saved well over $300 million over the last 4 
years on this effort. EM is now coming up to speed and is going 
to start using this for its bulk purchases itself.
    So, I think it has been great. We have got a couple of 
pages of synergistic opportunities that Neile knows that I want 
to push through very much on the EM side. I would be glad to 
provide some details for the record, if you would like, on 
specific EM-NNSA synergies.
    I think it is probably important to say, for the record, 
that EM is not being subsumed within the NNSA. It is a 
completely separate organization, obviously a completely 
separate appropriation, as you know. This is not about moving 
the weapons programs, taking over that budget, and moving those 
resources in. There is a lot of work that has to happen on the 
EM side, both to meet state and local commitments, and we are 
committed to working very hard to meet those commitments.
    It does not need less resources, it needs commitment 
stability to get those things going.
    Mr. Simpson. Well, our concern has always been having 
stability within the EM program so that we had a path for 
cleanup.
    I said many times that if we do not clean up the legacy of 
the past, there will not be a nuclear future in this country. 
And so, we have to keep those commitments, and as you know we 
have agreements with states and other obligations.
    When Secretary Poneman called me and told me about that, I 
told him at the time that I had no problem with him doing a 
reorganization if they thought they could do it more 
effectively, efficiently, save money, and etc., but a lot of 
that depended on you being at NNSA. You do not have any plans 
to leave any time soon, do you? Just out of curiosity. No, I 
will not ask that.
    Mr. D'Agostino. I am not sure, but it depends on--obviously 
I have served at the pleasure of the President and he gets 
advice from many folks and I have to do the best job.
    Mr. Simpson. When you mentioned NNSA management, the 
National Academy of Science Research Council did a study on 
management issues hampering work at NNSA's nuclear weapons 
laboratories. They reported that a number of current and former 
lab employees expressed concerns about the deterioration of 
morale at the laboratories, along with ongoing or potential 
declines in the quality of science and engineering. We have now 
made considerable investments in world-class experimental 
facilities. Most recently, we are set to regain our position at 
the top of the list of the world's fastest supercomputers with 
the full-scale deployment of Sequoia at the Lawrence Livermore 
Lab this year.
    These sorts of accomplishments make it difficult to 
understand the continuing struggle that was mentioned in this 
report. What are you doing to address these issues while 
ensuring that the NNSA maintains effective oversight, and what 
can be done to improve the morale at the labs?
    Mr. D'Agostino. Okay. The report did identify that as a 
concern. It also validated our plan on shifting from a nuclear 
weapons-focused enterprise into a nuclear security-focused 
enterprise. It validated that the work for others strategy that 
we have is the right strategy. There has been a lot of 
attention on the management and the morale concerns and the 
trust piece.
    We have been working this problem for a number of years. 
Most recently within the past year with the National Lab 
Director's Council, which is a council of all the lab directors 
in the department identified 28 or so items that were of 
concern to them, what were called burdensome orders and 
directives and the like. We systematically worked our way 
through those, with the rest of the department, and took care 
of 25 of those 28. Two of them the lab directors have asked us 
to put on hold on that, and one of them we are still working. 
The key is that as things come up, we want to--that the lab 
directors, we want to address them head on. We are very 
sensitive to that.
    I know that in the NNSA side of my portfolio, I have some 
special authorities that I can use in order to help myself take 
care of these particular problems. In one particular area, in 
security--because security, obviously, is a big part of the 
NNSA mission--we looked at simplifying our physical security 
directives and our information security directives. There are a 
lots of directives in this particular realm and what we heard 
consistently from our labs and plants were that they were being 
inspected to different levels of--you know, there was a little 
bit of a moving goal line here. So with the HSS organization 
but largely based on the authority I have, we created two 
internal documents called the NAPS--NNSA Administrative 
Procedures--focused on those two things to clarify what the 
requirement sand directives were in this area.
    And as a result of that work and, in fact, as a result of 
other changes in the security budget or in the security 
program, over the last 2 years we have been able to reduce the 
security liability and the programmatic requests in the 
security area by over 10 percent, and that is very significant 
because over the previous years we were seeing a constant up-
ramp of what it takes to do security.
    Mr. Simpson. Your budgetary request this year is for a 
decrease in security money, is it not?
    Mr. D'Agostino. Yes, sir. It is for a pretty significant 
decrease, and that is a direct reflection of the programmatic 
changes, the directive changes, the reviewing of the orders, 
the clarifying of the directives that needs to happen. Not just 
in the security area now, frankly, in everything we do: 
procurement, human resources, acquisition, contract management.
    So, we are very focused on taking that model and moving it 
to other lines of our business because this will be addressing 
the specific question we are raising is, can we take care of 
the stockpile, you know, in the out-years? And also, do the 
work that is planned that the Defense Department would like us 
to do in the out-years.
    Unless we change the way we do business in all of these 
other areas, we will not have that opportunity.
    Mr. Simpson. If I could ask one more quick question, Mr. 
Chairman?
    Mr. Frelinghuysen. Fire away.
    Mr. Simpson. Since it is on that same operating procedure 
that you are going through. Of the total number of DOE pension 
costs reportedly projected for fiscal year 2013, nearly all of 
the growth over the past year is in the NNSA pensions. NNSA 
pension costs are growing faster than all other DOE programs. 
What are you doing to stem this growth? And there are a number 
of NNSA management and operating contracts up for re-
negotiation. Will you be taking the necessary contractual 
changes to make the contractor benefits less volatile and more 
cost-effective as part of those negotiations?
    Mr. D'Agostino. We will be using our opportunities provided 
us on the contract to be consistent with--to take a look at how 
we can better manage pensions. One of the things that has been 
done over the last few years that has helped stem the change 
here is taking a look at employee contributions towards 
pensions. It is very contract-dependent, so it is hard for me 
to speak in generalities, but they do not apply to all the 
contracts consistently--is to ask for and receive employee 
contributions on this and modify the benefits consistent with 
what happens in kind of, frankly, anywhere else in the country.
    We are very sensitive to making sure that people are 
grandfathered in appropriately because they came in under a 
certain view, but as new employees come in we are looking to 
make those changes. Sandia has done a wonderful job in this 
particular area on managing its pensions.
    An area that is a little bit more challenging is, you know, 
we do projections and we plan ahead with the actuarial tables. 
Sometimes early payment of a pension liability can help defray 
a big hump in the out-years and, you know, a $15 million 
payment now can help defer an $80 million payment later. But 
what we have seen is there is so much volatility in this area, 
both up and down, that in some cases it does not make sense to 
make that early payment.
    Mr. Simpson. Thank you.
    Mr. Frelinghuysen. Thank you, Mr. Simpson. Mr. Fattah.
    Mr. Fattah. Thank you, and let me thank you, Mr. 
Administrator, for your great service to our Nation. I join in 
my colleague, Mr. Simpson's remarks about the work that you are 
doing, particularly related to the nuclear labs. We did get a 
chance to visit the Sandia and Los Alamos labs.
    I want to follow up on this issue, but maybe from a 
slightly different angle. I continue to have an interest in the 
critical skills challenges that the agency is going to face 
moving forward. As you know, a large percentage of your very 
important personnel are soon going to be retirement-eligible 
and will be leaving.
    Before I came here, I just met with some of the AV students 
over at the Department of Energy's Innovation Summit over in 
Gaylord. These were very bright doctoral students pursuing a 
whole set of disciplines related to the hard sciences. But as 
you know, we have a dearth of younger people coming along that 
the baton can be passed to. Stewardship of our national 
weapons, modernization, and the nonproliferation work, all 
require American citizens with very substantial technical 
capabilities.
    Therefore I am interested in discussing how the pay freeze 
that has been put in place for multiple years has presented 
challenges to the agency in hiring and retaining needed 
personnel. I am actually taking a very different tact from my 
friend from Idaho. I think we should be rewarding employees as 
much as we need them, because we cannot afford to lose them. 
So, I actually think we should be making it more lucrative for 
them to stay versus to go at least until we can think about how 
we are going to replace them.
    So, I am interested in recruitment and whether the pay 
freeze has had any impact, number one.
    Mr. D'Agostino. Okay. The recruitment is always 
challenging. We can always find people that want to work with 
us, but we believe we have to make sure we have the highest-
caliber of individuals in this area. So, we are obviously 
competing with a wide variety of folks. Other universities, for 
example, other companies that may be able to offer more money.
    The one thing we have that they do not have, which is what 
we tend to focus on, is the mission work itself; the importance 
of the mission work, how much the country cares about it, the 
support it has in the White House--whatever President is in the 
White House--the support it has from Congress, no matter how 
the individual ups and downs go. The reality is, I think, is 
there is broad support for our Nation's security, and 
particularly the nuclear security piece itself.
    And what we find also is our scientists care about that, 
but they also care about being challenged technically with very 
difficult problems that the Nation cares about, some areas that 
are outside of pure nuclear weapons or nuclear security, but we 
use the capabilities to address this. The Macondo oil spill was 
a result of Sandia's, Los Alamos', and Livermore's efforts in 
that area. Our work in Fukushima last year on providing and 
doing the measurement data, we were there within a few days and 
we were providing real-time data on incidents on the ground. It 
is that kind of piece, that operational aspect, that tends to 
attract.
    The pay freeze or people worry about bonuses, obviously we 
want to compensate folks as well as possible, but we are in a 
situation where we recognize that the country has been under 
some very difficult challenges, and so the President had asked 
us as well to tighten our belts and I think that is consistent 
with that. Will it last many more years out into the future? I 
do not think so, but what we are going to focus on, frankly, is 
making sure that we can entice people in by the quality of the 
work that they have to do in this area.
    Mr. Fattah. Well the nuclear weapons are the central 
deterrent in our arsenal, right?
    Mr. D'Agostino. Yes, sir.
    Mr. Fattah. And we have invested billions of dollars. I 
have been told that in some cases it has been challenging for 
some of our laboratories to win the competition for some of the 
talent that is needed.
    Mr. D'Agostino. I believe that is the case, sir. Probably 
best--Don Cook who worked at one of our laboratories----
    Mr. Fattah. Yes.
    Mr. D'Agostino [continuing]. Might be able to offer some 
firsthand experience here.
    Mr. Cook. I will just try to address some of the things 
that we know and some of the things that we are worried about 
directly.
    Mr. Fattah. Okay.
    Mr. Cook. You know, when I looked at acceptance rates in 
the people we are attracting to science, where the acceptance 
rate--I mean, once an offer was made, acceptance rate would 
typically be above 90 percent, sometimes above 95 percent. That 
has actually been falling. I think we have an acceptance rate 
right now that is 80 percent, and it is continuing a bit of 
decline.
    I am not so worried about that, because 80 percent is still 
quite good. I am worried about the time when the economy really 
picks up and when newly-graduated students with bachelor's, 
master's, Ph.D., as well as technical training which is broadly 
applied through our plants and labs. You know, when the economy 
picks up then I think we are going to have difficulty 
attracting and we will see a fairly strong loss of people. So, 
that is a future event right now but one certainly on our radar 
screen.
    Mr. Fattah. To conclude this point,I think the work you are 
doing is extraordinary. I want tomake sure that the agency can 
continue to get and retain the best talent.And I think that 
this area ofinducements, salary, pensions, is an important part 
of that effort.It is obviously not the key issue as to what 
mightattract someone to work in this realm.
    But it is a needed part of this, and I do not want the 
human capital to be sacrificed as we invest so much in our 
technical capability because we do need people who know what 
they are doing in this particular regard. So, I thank you for 
your work and I look forward to continuing to work with you.
    Mr. D'Agostino. Thank you, sir. Likewise.
    Mr. Frelinghuysen. Thank you, Mr. Fattah. Mr. Womack.
    Mr. Womack. Thank you, Mr. Chairman, and thank you, Mr. 
Administrator, for your service to our country and also I want 
to personally thank you for the opportunity to take a tour not 
too long ago of your complex. And it really meant a lot to me 
and the more I toured, the more I found that I was a little bit 
over my head, as I am sure some of my colleagues are, in some 
of the subject matter we are talking about.
    I have kind of a general question and it is more along the 
lines of how the NNSA, Nuclear Weapons Council, DOD are 
interacting on some of the more strategic decisions and how 
that relationship works. And then I may have a follow-up 
question about DOD's relationship in this process on another 
angle. But can you just take a moment and kind of walk me 
through how that triad, if you will, works?
    Mr. D'Agostino. Yes, sir. I would be glad to, and thank you 
for your kind comments. If I could, I would like to start off 
and ask General Finan to add as well, since one of her main 
responsibilities is helping Don and I on our relationship and 
making sure we have the right kind of communication.
    The key structure, if you will, is the Nuclear Weapons 
Council. I am the Department of Energy and NNSA representative 
on that. It is at the under secretary level, and my 
counterparts are Under Secretary for Acquisition Frank Kendall. 
Technology and logistics is Frank Kendall in the Defense 
Department; Jim Miller, under secretary for policy; the 
strategic commander, General Kehler, as well, and Admiral 
Winnefeld, who is the vice chairman of the Joint Chiefs of 
Staff.
    Decisions are evaluated at lower levels. There are groups 
below that that are evaluated, proposed up. Don Cook works as 
the co-chair on the committee below us and brings them up for 
decision at the Nuclear Weapons Council level. Obviously, that 
is kind of the structural piece of it but the key, of course, 
is relationships between individuals, that we can trust each 
other. Because I have been working on the Nuclear Weapons 
Council for a number of years, I have testified with these 
individuals a number of times. I am in a good position to be, 
you know, very forthcoming on our program.
    The Defense Department has to have confidence that the NNSA 
can deliver on its products, and I work very hard to build upon 
that particular confidence piece.
    General Finan, if you could add to that?
    General Finan. Yes, sir. The key is trust, and while we 
have the formal structure of the Nuclear Weapons Council, SSE, 
and all the groups that work underneath it, it is the personal 
relationships that are between the NNSA personnel and the DOD 
personnel who are the advisors to the people who sit on those 
groups and can, in fact, influence what those folks see and 
think and how they view that interaction.
    So, part of what we are trying to do is engage at that 
level. We have the formal process, but to improve the 
relationships at the informal level so that if there is an 
issue between the two sides somebody can pick up the phone or 
have a meeting and say, hey, you know I heard this or, this 
bothers me, or can we talk about this, and so that 
communication flows freely. Because really, the key to building 
that trust is making sure that we are transparent and open. And 
while not everyone will always agree on decisions, that at 
least we have the level of transparency so that people know and 
understand why decisions were made.
    Mr. Cook. If I can add to this, there is a sizeable body of 
work being done by the Nuclear Weapons Council and its 
subordinate functions. Just as a reminder, we have the oldest 
stockpile we have ever had. The average life is now beyond 25 
years, and we have the smallest stockpile at any time since the 
Eisenhower Administration. That was quite a while ago.
    Now, given those two and the fact that there is a 
commitment by the President and by the House and Senate to do 
the appropriate modernization, we have a very demanding 
workload ahead.
    Looking in retrospect, the last time there was an 
authorization for full life extension program beyond Phase 6.3, 
it was the 76-1. It was done more than a decade ago, and so we 
are now at a point where we are getting what I would call the 
basic machinery back in place. The B-61 authorization to 
consolidate 4 families, the B-61 to improve safety and 
security, and give the beginning of Phase 6.3, which is full-
scale engineering development that was granted by the Nuclear 
Weapons Council.
    Other elements are proceeding. The W-78 and 88, what I 
would call the common, interoperable, and adaptable study, that 
is proceeding. And so, the body of work is coming ahead, as the 
Administrator and as General Finan have said.
    There is not only a lot of work, but a great deal of 
importance is given to relationships and relationships are best 
functioning when they become regularized. So, I would say we 
are at a reasonable beginning of a very strong demand.
    Tying back to the earlier comment that Mr. Fattah made 
about the people. People are most engaged when they are doing 
real work, and there is really challenging work that has to be 
done on cost, on schedule, and we must make the improvements 
that we need to in safety and security.
    Mr. Womack. This is kind of a follow up. Is there general 
agreement or disagreement over a science-based stewardship 
program and a life extension model?
    Mr. Cook. Let us see. There is developing agreement, is the 
way I would say it. There have been impressions by some that--
--
    Mr. Womack. Sounds like something we would say.
    Mr. Cook. You know, warheads--well, I could say warheads 
are more important than science, but, you know, I am not 
characterizing that as a broad view. We know that we need to 
now modernize. I will always say appropriately modernize and 
improve safety and security.
    You know, science when it is thought of, science is one 
thing. But when we think of science as the underpinning ability 
of the lab directors to do annual assessment of the stockpile 
we have, then that has an entirely different feel, and yet that 
is mostly what we mean about science today: application of 
high-performance computing, high-energy densities, 
hydrodynamics, material science, and I could go on and on.
    The more we have discussion and the more we talk about why 
we have this piece of the program in place and how it is used, 
then the more it is understood.
    Mr. D'Agostino. We did check on this because it is 
something--we use the word ``science'' and we do not always 
recognize it. One person sees science as a sandbox. We see 
science as directly applicable to the technical underpinning 
and actual work on the stockpile.
    We did a quick study of our science campaigns, which is a 
category and budget line, and we found out that about 88 
percent of those resources had direct application. We are doing 
an experiment on a component that was going to go into a 
nuclear weapon or run a calculation code or the like. The other 
12 percent had to do with the relationship with the 
universities to provide the--do scientific work with--
unclassified work that allows a pipeline of technical talent to 
come into our laboratories.
    So what we have to do is, our end, be very careful on how 
we use the word science and make sure that it is science with 
kind of the mission in mind, if you will, which is a phrase 
that gets used sometimes.
    Mr. Womack. Thank you. I want to thank you again for your 
service. Mr. Chairman----
    Mr. Visclosky. Can the gentleman yield for a moment?
    Mr. Womack. Yes.
    Mr. Visclosky. In response to the gentleman's question, the 
term appropriate modernization was used a couple of times. 
Could you define that as to the definition of military 
requirements and your resources?
    Mr. Cook. I would be pleased to. When I say ``appropriate 
modernization,'' what I mean is the focus is on improving 
safety and security, especially, and understanding that we have 
no new military requirements, nor do we have a military need 
for a newly designed nuclear weapon. So, the devil is in the 
details. Newly manufactured of existing design is my view of 
appropriate modernization.
    The administration is committed to using the wide range of 
refurbishment of reuse of existing components and of 
replacement through, you know--re-manufacture might be 
considered reuse, but that is what I meant when I am saying 
that.
    Mr. Visclosky. Thank you, Mr. Chairman.
    Mr. Frelinghuysen. Thank you, Mr. Womack and Mr. Visclosky.
    Mr. Womack. I will say this, Mr. Chairman, my next town 
hall meeting when somebody says, are you guys getting anything 
done, I am going to say we have a developing relationship.
    Mr. Frelinghuysen. Good. The devil is in the details, but 
not all science is benign.
    Mr. Womack. That is correct.
    Mr. Frelinghuysen. I want the committee to focus, and my 
questions will focus on a lot of talk in the media about 
further reducing our stockpile. By some accounts there are some 
pretty drastic reductions being considered, and you are some of 
the key players in that decision-making process.
    So can you tell me what we are doing and you are doing 
since you represent the military and institutional civilians. 
What is your role in this new sort of upgraded nuclear posture 
review implementation study? Did we not just finish a nuclear 
posture review?
    Mr. D'Agostino. Yes, Mr. Chairman.
    Mr. Frelinghuysen. Is this an add-on? Or what is going on 
here?
    Mr. D'Agostino. No, Mr. Chairman, it is not an add-on. The 
nuclear posture review is basically--took the exact same 
nuclear policy that the country has had before, since the early 
part of the last decade, and laid out a vision and some 
challenges. It also clearly stated that the country is also 
going to conduct a follow-on review.
    Mr. Frelinghuysen. So, we just finished a review. And so, 
how often do we do those reviews?
    Mr. D'Agostino. Typically they get done, you know, once 
every four to eight years, frankly.
    Mr. Frelinghuysen. So this is a stepped-up, accelerated 
review?
    Mr. D'Agostino. Consistent with the NPR that asked for a 
follow-on look. We are advisors into an interagency process, of 
course, that looks at, you know, how do we look at our 
stockpile.
    Mr. Frelinghuysen. So, how are we looking at our stockpile 
here? Can you confirm that the Administration is considering 
additional reductions, having been mentioned? We have the 
smallest stockpile in our history. We have the oldest 
stockpile. Can you confirm that you are taking a look at 
reducing it further?
    Mr. D'Agostino. Right now, what I will confirm is that 
there is very clearly the administration knows that it has to 
take care of the existing stockpile for the next 10 years for 
it to work. To get us to the START 2 Treaty levels in seven 
years is our plan of action, if you will. And that plan of 
action talks about 1,550, a total of 1,550 operationally 
deployed warheads----
    Mr. Frelinghuysen. But there is talk of actually more 
substantial reductions, and I assume you have been involved in 
those discussions?
    Mr. D'Agostino. I have not been involved in talking about 
reductions publicly, no, sir.
    Mr. Frelinghuysen. But you have been involved in 
discussions surrounding the size of our nuclear stockpile. I 
assume that is done on a fairly regular basis.
    Mr. D'Agostino. Particularly as it comes to advising on 
what it takes to have 1,550 operationally deployed warheads, 
the number of weapons we feel we need to maintain for a hedge, 
particularly as we look at the current state of our stockpile--
--
    Mr. Frelinghuysen. So if we are going to be reducing our 
stockpile, that is cutting them in half. Where is the hedge 
here?
    Mr. D'Agostino. I prefer not to deal in speculation, 
actually, Mr. Chairman.
    Mr. Frelinghuysen. All right. So, we are not moving ahead 
with talk about further reductions?
    Mr. D'Agostino. I know that it is in the press, but I am 
not doing that internally, inside the administration.
    Mr. Frelinghuysen. Is any of this being driven by 
constraints on your budget?
    Mr. D'Agostino. Absolutely not. None of these are involved 
in any constraints on our budget. The President is very 
clearly, the administration very clearly is asking for the 
resources it needs to take care of the 1,550 deployed stockpile 
plus the hedge warheads we need in order to maintain those 
1,550 deployed. So, that is very clear. I have very strong 
support kind of on that front.
    There will always be policy discussions that happen at 
various levels, both classified and unclassified. Everybody has 
a view on the size of a stockpile. I think the most important 
thing----
    Mr. Frelinghuysen. But if things are shifting here, I think 
we need to be part of the equation. I assume there is something 
going on here, and I think Congress needs to be included in the 
mix.
    Mr. D'Agostino. I think congressional input is very 
important, and in my discussions with my colleagues, 
congressional input is going to be sought.
    Mr. Frelinghuysen. So what is this add-on to the relatively 
recently completed NPR implementation review?
    Mr. D'Agostino Well, there is a view that there is a new 
NPR coming out. That is absolutely not the case. Every 
President since I have been in this program, and I have been 
for many years, every President evaluates the stockpile it 
needs in order to implement the policies that it has laid out 
in front of itself. That was no different than the previous 
President I worked with, who, frankly, did a unilateral 50 
percent reduction in the size of the stockpile. However, in 
this case, as Don mentioned, we have the oldest stockpile and 
we have the smallest one since the Eisenhower administration, 
and from that standpoint, our responsibility, Don's and my 
responsibility, are to advise the secretary, first of all, also 
my colleagues second, in potential changes that can be made.
    Mr. Frelinghuysen. Yes, we have often invoked, you invoked 
and I think highly of all of you, the words ``trust'' and 
``confidence,'' but some of us are concerned about some strong 
suggestions that the stockpile be reduced. I mean, one of the 
things that gives us confidence as a nation is the ability to 
have a nuclear deterrent, and if there are some plans afoot to 
substantially reduce our stockpile, I think we ought to know 
about it.
    Mr. D'Agostino Right.
    Mr. Frelinghuysen. Yes, I am all for modernization that we 
are proceeding on but----
    Mr. D'Agostino Right.
    Mr. Frelinghuysen. But we need to keep that nuclear 
deterrent and if the secretary of energy needs to sign off on 
the reliability of it.
    Mr. D'Agostino Absolutely.
    Mr. Frelinghuysen. Yes?
    Mr. Cook. Yes, if I could----
    Mr. Frelinghuysen. Now I am going to go to Mr. Nunnelee, 
who was here earlier, and I apologize. Go ahead.
    Mr. Cook. I just wanted to add a somewhat salient point. We 
are implementing the Nuclear Posture Review and key parts of 
that review involved infrastructure and it involved science, it 
involved Life Extension Programs. It is a reasonable thought 
that as we succeed with modernization efforts that in parallel 
with that, we look especially at the technical hedge.
    So, I am going to separate the two issues. There is 
geopolitical hedge that might mean how the world develops in 
the future and the technical hedge. We are certainly looking at 
the technical hedge all the time because as for W76-1 warheads, 
for example, as we continue to build those at the rate planned 
and we are achieving the rate planned, then there might be an 
opportunity not to have to spend as much money on technical 
hedge as the need goes down. Instead apply that money to more 
of a life extension. That is just a part of the----
    Mr. Frelinghuysen. Respectfully, Mr. Cook, I just got back 
from Japan and Korea and the scientists that I am referring to 
are not denying. There are things happening in North Korea, 
there are thing happening in China, things happening in Iran, 
and they directly relate to the reliability and the size of our 
nuclear stockpile.
    I know where you are coming from here, but we need to 
remember that there are scientists out there who are working 
night and day on creating nuclear weapons and I think we need 
to be prepared for those challenges. I mean, that is basically 
why you guys exist, why we exist here.
    Mr. Cook. Sure.
    Mr. D'Agostino Absolutely.
    Mr. Frelinghuysen. And you do good work, but we need to 
continue to understand that a deterrent is important and 
modernization is fine, but let us understand that there are 
enemies that are working on their own version of nuclear 
weapons and we need to be prepared to meet those types of 
challenges.
    Mr. Nunnelee.
    Mr. Nunnelee. Thank you, Mr. Chairman.
    I understand the Navy has recently expressed a concern with 
your request to change how it would fund the W76 Life Extension 
Program. If you could just explain your changes in the budget 
request and does that assume the Navy's concern and impact it 
would have on our strategic defense?
    Mr. D'Agostino. Okay, Sandra.
    General Finan. Yes, the Navy does have a couple concerns 
specifically with the 76. The biggest concern is as we have 
looked at how to restructure programs in order to support all 
the programs and specifically the B61, what has happened we 
have eliminated the margin. So, if there are any issues with 
the schedule, the Navy's nervousness comes from the fact that 
our ability to absorb issues that may arise, essentially, we 
have accepted more risk in the program. And so, they are 
uncomfortable with that level of risk.
    They are aware of that level of risk and we have talked 
about that and we are aware of their concerns are we are 
looking at all their information. We are trying to make sure 
that we understand all of their concerns so that we can 
adequately address each one as they come up, but we are each 
aware of the concerns and really it boils down to margin. I 
think the program is executable as it is right now, but the 
margin is down to nothing.
    Mr. Cook. If I can just add a point, in the recent Nuclear 
Weapon Council decision, looking at all of the Life Extension 
Programs, not one at a time, but all of them together, we 
believe that it was most appropriate to get the 61 Life 
Extension Program underway, on schedule, and to implement the 
Nuclear Posture Review. And in times of constrained budgets and 
because there were some I will just say unanticipated cost 
estimates, that the costs are accurate, but it has been a very 
long time since this nation did a life extension on a bond.
    We have done the 76, which is a warhead and bombs tend to 
be more complex. Given that, we then decided to propose a 
strategy with the Life Extension Programs that would meet the 
President's intent, meet the military needs, and one element of 
that was since we have achieved a build rate at Pantex and all 
of the supply chain for the 76s, we suggested that we could 
build the technical hedge for the 76-1s after we complete all 
operational requirements.
    So, let me restate that differently. We will support all 
operational requirements of the Navy. Rather than build the 
hedge in parallel, we proposed a plan that would say we add 
three years to that program, we build the hedge during 2020 and 
'21, and if we did that, because there are 6 years from '13, 
this budget request through '18, we would be able to sustain 
the current build rate that we have, keep it going for 3 more 
years, but not ramp that up and put the 61 at a disadvantage.
    So, it was a trade space, but almost entirely devoted to 
Life Extension Programs. No increase for science. In this area, 
no increase for infrastructures, strictly with LEPs.
    Mr. Frelinghuysen. Alan.
    Mr. Nunnelee. Thank you. Thank you, Mr. Chair.
    Mr. Frelinghuysen. Mr. Nunnelee, Mr. Visclosky, we are 
talking about infrastructure, right?
    Mr. Visclosky. Yes.
    Mr. Frelinghuysen. Maybe?
    Mr. Visclosky. I do not know. That is a second question.
    General, you seem like such a good person. How did you end 
up at USC?
    General Finan. (inaudible)
    Mr. Visclosky. I am just asking.
    Mr. Simpson. [Good] football team.
    Mr. Visclosky. I will stop while I am ahead.
    In that vein, General, talking about the synchronization of 
DOD and NNSA Modernization Programs, for example, on the W-78 
warheads, NNSA is on a track for 2021 and the Air Force is on a 
track of 2030 for the minuteman. Can you talk to me about the 
funding and the synchronization and why the nine-year gap? What 
am I missing on the outside looking in?
    And as far as other modernization programs relative to the 
delivery system and the warhead, are there other differences as 
far as the timeframes and why do those differences exists and 
what are the financial impacts?
    General Finan. Right. Of course, we coordinate all the time 
on their doing the delivery platforms and us producing the 
weapons. So, that is ongoing. Specifically with the 78, 
actually, the new date for us is 2023 versus 2021.
    Mr. Visclosky. Okay.
    General Finan. We pushed it back two years. Part of that 
was it would align a little bit better with the follow-on for 
the Minuteman if the Air Force goes down that route. The other 
issue with that particular weapon is that we are going down a 
path with DOD in which we are looking at a common or adaptable, 
depending on what terminology you use, but we want to start 
looking at the stockpile so that we can use these weapons in 
different aero shells. And so, as we look at this 78, which 
will go initially on the minuteman, we want to also make it 
adaptable or common with the 88.
    And so, we want to try and bring those programs so we have 
an Air Force, Navy, and we can actually do some hedging with 
those weapons to hedge each other so it helps with the hedging 
strategy. But the 78 is initially for the minuteman weapon 
system and the negotiations that are going on is to make sure 
that whatever we do is also compatible with whatever the Air 
Force decides to do with the follow-on.
    Mr. Visclosky. Well, you had mentioned that if the Air 
Force goes down that road, is part of the pushback to 2023, 
waiting to see what the ultimate decision of the Air Force is 
relative to the delivery system?
    General Finan. In this case, that was not the driver. We 
were looking at how to align with the B61, how to align all the 
LEP programs, and so, it made more sense to push that to 23. In 
this case, the Air Force was supportive because it did come 
closer to aligning with when they would be looking at doing 
things with the follow-on missile.
    Mr. Visclosky. Why did you say ``if the Air Force?''
    General Finan. Well, because I do not know what path the 
Air Force will ultimately decide they are going to down on the 
follow-on missile, and I am not in on the details of Air Force 
positions, so.
    Mr. Visclosky. Okay, okay. On infrastructure, and my mind 
was read by my colleague, committing to maintaining our 
infrastructure was one of the recommendations in the posture 
review. And as I understand the budget request for 2013, the 
request proposes the end to the congressionally-mandated 
facilities and Infrastructure Recapitalization Program a year 
early. The program has addressed hundreds of millions of 
dollars of deferred maintenance, but it has not kept up with 
the continued deterioration of the legacy of facilities.
    How does your budget request adequately address the problem 
we have as far as maintaining that infrastructure?
    Mr. Cook. Yes, if I could answer, within the details of the 
budget, you can see the justification and description of 
recognizing that we have a basic capability and we have a 
complex that is much more characterized by its capability than 
its capacity. Then the intent on infrastructure is to move from 
the situation where the attention was on reducing the backlog 
of deferred maintenance, repairing roofs, keeping the things 
that we had in place and going to a strategy in which we focus 
on those capabilities that are actually required. So, 
capabilities, facilities, and infrastructure--capability based 
facilities and infrastructure is where we are headed, and, once 
again, and as much as you might, then we are aligning those 
capabilities, the facilities along with the workload that we 
have for the Life Extension Programs and for annual assessment 
of the deterrent. So, it is a somewhat subtle shift, but it 
puts the focus more on just focusing the capabilities that we 
needed rather solely on deferred maintenance.
    Mr. Visclosky. That is the first question. If you want to 
follow-up.
    Mr. D'Agostino Well, I wondered if I could add, there is 
deferred maintenance in our enterprise. No question about it. 
What we have done, though, is, just like in most people's 
homes, people have not maybe replaced the air filter on it 
every six months. Hopefully, they do it at least once a year.
    Mr. Visclosky. Every three years.
    Mr. D'Agostino Every three years, all right, sir. But the 
key for us is we have taken a survey of all of our facilities, 
we have designated certain of our facilities as mission-
critical facilities and some other facilities are mission 
support and then there is a third category of just maybe office 
buildings, if you will. Not that the office buildings are not 
important, but when we have limited resources, we said we want 
to make sure our mission-critical facilities, that deferred 
maintenance is low and we use an industry metric and the 
building's industry uses this, called a Facility 
Characterization Index and which is really a ratio of deferred 
maintenance to replacement plan value. And if you get it below 
5 percent for your most important facilities, that is 
considered best in class, and that is where we are in the NNSA 
is for our mission-critical facilities. FCI essentially, is 
below that 5 percent level.
    So, we are very confident that the most important stuff is 
getting taken care of. It is always a challenge in wanting to 
do more.
    Mr. Visclosky. Is it in the budget request, and I am not 
seeing it, closures of certain buildings and things that may 
not be critical?
    Mr. Cook. It may not be specifically in the budget request, 
but I believe you understand the strategy. There are some 
things which we no longer need and continuing to carry on the 
books every year, they get older, and we have an increased 
deferred maintenance log. What we are saying, just as the 
Administrator said, those facilities we really believe are 
important and critical. We are going to pay more attention to 
those that we want to get ultimately decommissioned, 
dismantled, disassembled, and removed, disposed, are ones which 
we are going to put in a separate category. So, in the past we 
have looked at there were some gradations, but the key tagline 
was deferred maintenance. In the future, it is going to be----
    Mr. Visclosky. Facility closure.
    Mr. Cook. [continuing]. Is the capability needed and what 
is its condition? Yes.
    Mr. Visclosky. Can closure of facilities that are no longer 
needed potentially reduce some of your security operations 
(inaudible).
    Mr. Cook. That is also correct.
    Mr. D'Agostino Absolutely.
    Mr. Visclosky. Thank you, Mr. Chairman.
    Mr. Frelinghuysen. Thank you, Mr. Visclosky.
    Mr. Womack.
    Mr. Womack. Just one final question. We are 75 minutes into 
this discussion, and I do not think the word ``sequestration'' 
has come up yet. So, let me break the ice. Random thoughts on 
the impacts of what happens under a sequestration?
    Mr. D'Agostino We do not have a sequestration plan. We are 
not out trying to plan that there will be a sequestration. 
Obviously, a sequestration, which we hope does not happen, 
would result in dramatic changes, obviously, across the 
government. This is something that obviously presents very 
significant additional challenges in this area. I think we do 
not want to presume how things will end up, but what I will say 
is the administration, we are very committed, we know work 
needs to happen. I believe we understand the priorities and we 
are going to press on in that way.
    Mr. Womack. Thank you, sir.
    Mr. Frelinghuysen. Glad you raised the issue. I mean, I 
think it is important for everyone on the Hill to be aware of 
what the consequences would be of that policy being put into 
effect.
    Mr. D'Agostino Yes, sir.
    Mr. Frelinghuysen. I would like to focus a little more on 
the B-61 Life Extension Program. We received only vague details 
of the administration's decisions that have been made on how to 
extend its life. We have no greater detail than we did last 
year at this time, yet, you are requesting $369 million for 
this program at an increase of $146 million. No cost estimates 
have been provided to the committee, yet you are asking to move 
out on work and begin development of various components. Last 
year, you stated the cost study would be completed in September 
of 2011. It is now five months later with no finished cost-
study and no additional insight.
    Why have there been such significant delays?
    Mr. Cook.
    Mr. Cook. Yes, I appreciate the question. I will take the 
first part and then, perhaps, go to General Finan. In the 
Nuclear Weapon Council processes, we have run through a range 
of options. They were considered from the time that we had 
completed this 62 study in the 6X process. 62A is in costing 
the alternatives. Because of the size of the cost, we went 
through a deliberate process within Nuclear Weapon Council just 
about each month through the late summer and, certainly, in 
November, a lengthy meeting in December, a lengthy meeting in 
January, two meetings. In all of that time, the Nuclear Weapon 
Council was still considering which option to take. It is only 
recently that the decision was finally made and that the 
decision was written by the Nuclear Weapon Council. I think we 
have offered to the committee----
    Mr. Frelinghuysen. So, you have actually completed your 
cost estimates?
    Mr. Cook. We have completed the cost estimate at a level 
sufficient for the Nuclear Weapon Council to make a decision. 
Now we have further cost-estimating going on that draws at the 
subsystem level, component level, gets the precision of that 
cost estimate to a greater level.
    If I could say there is an equivalent, it would be in 
construction projects. It is not an exact parallel, but in 
construction projects, we said we would not set a baseline for 
the project until we are at 90 percent of full-scale 
engineering design. In Life Extension Projects, we actually set 
a baseline before that point, but we do not want to set a 
baseline too early when the costs are surely going to change, 
and, so, very early In our comments I mentioned that NNSA was 
undertaking a study with GAO and DOD, looking first at the 61-
12 Life Extension Program----
    Mr. Frelinghuysen. Indicate being part of a----
    Mr. Cook. It is part of the Department of Defense.
    Mr. Frelinghuysen. Allow different players at the table.
    Mr. Cook. That is right. And so what the Nuclear Weapon 
Council required before a final baseline is set is that this is 
looked through in detail, and that is what we will conclude in 
about July. As far as making the request for 2013, we are on 
solid ground. We know where we intend to do the work. We are 
shaping up, as I mentioned earlier, our budgets and the 
President's request for 2014-2018. We will provide information 
to the committee that at your request has asked what options 
were considered. We will go through the briefing. That is now 
available on----
    Mr. Frelinghuysen. So the cost study is a work in progress 
here?
    Mr. Cook. Yes, yes it is.
    Mr. Frelinghuysen. With a likely date of----
    Mr. Cook. July.
    Mr. Frelinghuysen. July, okay. You stated that now you are 
pushing back against a start date for the first production 
unit. Why are you now unable to meet the 2017 date that was 
stated in the nuclear posture review?
    Mr. Cook. 2017?
    Mr. Frelinghuysen. Yeah.
    Mr. Cook. At the time that it was stated, and while the 
nuclear posture review was developed was consistent with, the 
time that we required to do the work. We had some delays at the 
front end of the project. It may have been that the backend, 
the FPU, was somewhat aggressive already. Without looking at 
where we encountered the delays, we encountered a delay of 
about a year and a half.
    Mr. Frelinghuysen. But delays are directly related to the 
whole issue of reliability here, right? Your ability to--there 
is a link here, is there not?
    Mr. Cook. The delays were getting the authorization to 
proceed with a full nuclear scope was a key delay. We had 
gotten the authorization to proceed with non-nuclear elements 
about a year before that, but there was a delay in getting 
authorization. So once we got there and the end date had not 
changed when we seriously looked at what the required first 
production unit date was, it was the components in the existing 
families that I mentioned we would consolidate, the 3, 4, 7, 
and 10 families, the B61.
    We tasked the labs of doing some work. Sandia with part of 
the work on neutron generators, and we ultimately came to a 
judgment that the first production unit in 2019 would be an 
executable path forward as well as a path where we could really 
mature the engineering, make the best improvement, cost 
constrained on safety and security that we could and take on a 
substantial level of work. But it was the military's minimum 
requirement--the Air Force for this--was to consolidate 
families 3, 4, 7, and 10. And to do that work, we said we could 
get that done by 2019, but we could not do that amount of work 
by 2017.
    General, I could turn to you if you have any additional 
comment.
    General Finan. The only additional comment is we were on a 
path for which the original development of the B61LEP was 
essentially financially unconstrained. And all of a sudden it 
became obvious that we were financially constrained. You 
cannot----
    Mr. Frelinghuysen. It was out of control somewhat.
    General Finan. The wish list had gotten huge. Everything 
was added in. And for whatever reason we decided that was the 
set of options we were going to look at, and that is what they 
did the detail cost estimate on. When we looked at that----
    Mr. Frelinghuysen. Well, that was a little bit of 
encouragement from us.
    General Finan. Right. It was unrealistic to look at that 
much money----
    Mr. Frelinghuysen. Financial constraints.
    General Finan [continuing]. To refurbish this weapon. And 
so as we looked at that, that is what has caused all this last-
minute, you know, we have got to redo the cost analysis. We 
have come up with another, a whole other option that did not 
exist at the time we did the original studies. It is one of the 
things that we need to look at doing better is, you know, when 
we do our studies, allow it to be a buildup so that we can make 
some choices as we go through that process rather than you can 
have this or you can have nothing, which is essentially what we 
got to the choices. We did not have viable choices. When the 
final thing was done, there were not any real choices to be 
made.
    Mr. Frelinghuysen. Of course, the other issue here is we 
are not the only people who are counting on this work, right?
    General Finan. Right.
    Mr. Frelinghuysen. We have some allies that are, you know, 
counting on us to continue to provide one of those----
    General Finan. Right, absolutely. And it gets back to the 
transparency----
    Mr. Frelinghuysen. So over in Japan--I mean in Korea, I 
mean, this is all about a nuclear deterrent here.
    General Finan. Right. And so that really kind of put us in 
a pickle. And so that is one of the processes that is changing.
    Mr. Frelinghuysen. So there will be gaps in meeting what we 
need to do relative to our allies or not?
    General Finan. No, there will not.
    Mr. Cook. There were a range of options taken. At the high 
end, it was all bells and whistles. And, in fact, there were 
three different variations of that. At the middle end there was 
an option, but that option had not been completely fleshed out. 
At the low end there was only replace the limited life 
components that caused the problem right now. And then surely 
by about five years or seven years from now, we would have to 
do a life extension. We would be starting later and the systems 
would be in worse shape and not yet consolidated. In the end we 
took a middle option. It was formed up sufficiently well to 
have credibility in both NNSA, the Air Force, the Nuclear 
Weapons Council, and U.S. Strategic Command agreed on that 
option. So that is----
    Mr. Frelinghuysen. And we have all the costs related to the 
middle option or will----
    Mr. Cook. We have all the costs. We have all the items, but 
they are not yet at a level of precision that will allow us to 
set a formal baseline and then hold labs and plants accountable 
for execution of that.
    Mr. D'Agostino. And this is what we will work with the 
Defense Department, on that level of precision, over the next 
few months because we know it is important for the committee. 
It is important for us to have that insight, not just for 
fiscal year 2013, but it is actually the out-years piece 
because that out-year piece on the most important work that we 
have to do helps us inform us on what might need to change if 
anything on how we look at our resources in the out years. So 
having that baseline----
    Mr. Frelinghuysen. There may be other changes, and I 
reference some of those, but we will see what happens. Mr. 
Visclosky.
    Mr. Visclosky. Thank you, Mr. Chairman. The department has 
announced that you are indefinitely delaying the construction 
of the CMRR nuclear facility, one of the major new projects 
that was also identified in the 2010 posture review. Could you 
explain the decision-making process that led to that decision, 
and are there other options that are also being considered?
    Mr. Cook. Let me address the first layer. We did make a 
decision ultimately to not indefinitely defer, not cancel, but 
to defer for a period of at least five years the CMRR nuclear 
facility. I will just try to capture quickly what went into 
that decision. It involved the Life Extension Programs. It 
involved other infrastructure. It certainly involved uranium 
and plutonium capabilities that are strongly tied to the weapon 
life extension programs.
    The situation that we faced is today we make the second 
recomponents in Building 9212 at Y-12, the Y-12 plant in 
Tennessee. We make the primary components actually not in the 
present CMR or would be in CMR. We make them in plutonium 
facility number 4 in tech area number 55 at Los Alamos.
    But CMRR is planned--I did not say was, I said is planned--
to have the capability for a plutonium storage for materials 
characterization with large samples of plutonium and then for a 
lot of work of actinide chemistry. So part of the decision that 
went here is for uranium, we are in a building that is a very 
old building. It is used up, and we need to get out of it. 
There is not a secondary path, another path.
    Mr. Visclosky. 9212?
    Mr. Cook. 9212, right. And there we need the uranium 
processing facility to take on those activities. I will come 
back to that in a minute.
    With regard to PF-4, we have the capability to make pits 
today. It is a capability that we continue to invest in, in 
infrastructure. PF-4 is 34 years old, but CMR, without the two, 
is 60 years old. So we need to have a defined plan to get out 
of the rest of CMR and close it down. Much of what was done in 
CMR was analytic chemistry and materials characterization. So 
now some of why we made the decision on the plutonium side was 
another part of the CMRR project, not the nuclear facility, is 
this thing we call the radiological laboratory and utility 
office building, RULAB for short.
    Mr. Visclosky. Who comes up with these names?
    Mr. Cook. I am still trying to find out.
    Mr. Visclosky. That one I think I am probably guilty.
    Mr. Cook. Okay.
    Mr. Frelinghuysen. So RULAB----
    Mr. Cook. RULAB, we call it RULAB.
    Mr. Visclosky. It is the radiological laboratory, sir.
    Mr. Cook. It is sort of impossible to say RLAUOB, and so we 
go with a different name.
    Mr. Visclosky. I appreciate your dropping the other R.
    Mr. Cook. Yeah, okay. So now the good thing about RULAB is 
it is a brand new building. It is a year ahead of schedule. It 
is under budget. And it is now giving beneficial occupancy and 
now we are moving equipment in.
    Another part related with this, you know, the highest turn 
rate, things we need to do are analytic chemistry. When we make 
one pit, we take about 200 material samples. And we do the 
chemistry round to ensure that we have basically the right 
stuff in the pits. That work can be done in RULAB. We are very 
close to full utilization now. And we sought ways and 
ultimately succeeded in expanding the level of plutonium work 
that could be done with the latest dose conversion factors, 
international standards, and the administrators issued 
supplemental guidance that increases our ability to do 
plutonium work in RULAB by a full factor of four. So that was 
an ameliorating effect.
    With regard to storage, we have capabilities that were 
analyzed----
    Mr. Visclosky. Just so I am clear in understanding, that is 
not the uranium processing facility.
    Mr. Cook. No, this is plutonium, so just talking strictly 
about CMRR. And I am attempting to state the conditions that 
went into a decision to defer for at least five years how we 
could do that and why we could do it. So the key functions of 
CMRR were plutonium storage--if I misspoke before, I am sorry--
plutonium storage, materials characterization, and analytical 
chemistry. So for analytical chemistry, RULAB is going to help 
us a great deal with. Materials characterization requires what 
we call hazard category 2 space. PF-4 is one of those 
facilities. We will continue materials cat work there.
    Also the plutonium facility at Livermore is one of those. 
Superblock is its name. At Superblock, we are meeting our 
commitment to deinventory all security category 1 and category 
2 nuclear materials that will be complete on schedule at the 
end of this year. We had always planned to continue to have 
abilities within Superblock. They would be done at security 
category 3, but hazard category 2. And it is certainly a much 
newer building than CMR is. And so the workload on materials 
characterization, the larger samples, would be shared between 
PF-4 and Superblock.
    When it comes to storage, we have the device assembly 
facility in Nevada. We have expended money and work to get that 
facility into proper shape, improve fire control, fire 
response, and it is a very secure facility. So we are exploring 
the option of whether we could have a longer term material 
storage for plutonium in that. I am not saying we will not need 
a future plutonium facility. I believe we will. But when we 
look at when we would have had CMRR, it was 2023 as you can see 
in the SSMP and the 12-51 reports. So this decision means that 
we will not have a new plutonium capability until 2028 rather 
than 2023.
    Given that decision, we have accelerated now what we can do 
with plutonium. Again, in order to do the best we can with 
plutonium, we are cleaning up the day vault in PF-4. Without 
going into any more details there, I will say that allowed us 
on the uranium strategy to actually achieve the build of the 
uranium processing facility faster. And so you will see in the 
President's request moving from $160 million to $340 million.
    Mr. Frelinghuysen. Go ahead.
    Mr. Visclosky. Since you mentioned the uranium processing 
facility and getting out of building 9212, I have an estimate 
of $3.5 billion for the processing facility that apparently is 
outdated, one for $6.5 billion, and then one for $8 billion. 
Why the range as far as the cost for that facility? What does 
the administration believe it will cost today?
    Mr. Cook. The administration, we in NNSA, formerly took the 
step when we were 45 percent of the way through full 
engineering design for UPF to update the cost. We determined 
that the cost range was 4.2 to $6.5 billion, and we wrote that 
down and it shows up in our reports. The difference in those 
two is a 50 percent confidence and an 85 percent confidence in 
the formal methodology of how cost assessments are done. There 
is no magic number. They are always weighted by confidence. 
Higher estimates have----
    Mr. Frelinghuysen. If the gentleman will yield, so this 
process was started and then you sort of reevaluated it again? 
Is this a confidence level issue here?
    Mr. Cook. There was an earlier estimate for UPF that was 
done several years ago. I would say over five years ago.
    Mr. D'Agostino. Yeah, in 2009. In 2009, I think it was a 
$3.5 billion point estimate. There was a range associated with 
that. That estimate came with certain assumptions. That we 
would start right away on construction. That was just before 
the Deputy Secretary's new project management policy, which 
says we are not going lock down, ask for construction, or get 
the construction going until we are done with 90 percent of 
design.
    There were a number of assumptions on that $3.5 billion 
estimate that says let us really wait until we have got this 
thing at the 90 percent level before we establish a baseline. 
Because of that and the shift into ``now we are going to make 
this a priority,'' we did not start on construction on that 
facility when we thought we were, when the estimate was first 
pulled together; therefore, that got us to this middle number 
that you just described.
    The higher numbers are--I believe the Army Corps of 
Engineers came out with a number and that is for the fully 
scoped uranium processing facility. What we believe will happen 
in this case is the most important work is what you just 
described, sir, which is 9212. The original UPF was going to do 
a lot more than 9212, but Don has decided to focus only on 
getting out of that building, moving those capabilities over. 
And so we believe that is going to drop the number back down. 
It is not going to be that higher number.
    Mr. Cook. That is correct. We have not changed the 
footprint, and we do need to get out of 9212. So portions of 
the uranium facility that we are accelerating are the main 
structural building itself. We will also accelerate the 
movement of uranium casting capabilities, I will say in an 
unclassified level, from 9212 into UPF, and we now plan to 
begin that migration in 2019. So from the 2013 budget, that is 
just six years away. We will still retain the estimate, the 
range estimate of cost. We have seen nothing that says that 
should be different. So we will still be 4.2- to $6.5 billion, 
but by focusing time scale, accelerating in the construction 
profile, that will tend to drive the cost down. We are not 
going to set a new single-point cost estimate until we have the 
basis to do that.
    But in the President's request, you will see we had the 
costs of all the life extension programs, most notably the B61. 
And we were attempting to do two major construction projects in 
parallel, but in a constrained fiscal environment, decided that 
we could not do all three at one time. We have to get out of 
9212. We need to do the 61 Life Extension Program. And we found 
an effective way to take a deferral for at least five years in 
the plutonium strategy.
    Mr. Frelinghuysen. Thank you. Mr. Nunnelee, thanks for your 
patience.
    Mr. Nunnelee. Well, thank you, Mr. Chairman. I did not 
intend to have a question, but the response to Mr. Womack's 
question on sequestration caused me to have a question.
    Let me characterize my takeaway from that answer, and these 
are my words, not yours. When Mr. Womack asked about 
sequestration, the response was well, we do not want to cause 
undue alarm, and we hope that sequestration is not going to 
take place so we are not making any plans. If anything, my 
exposure to folks in the military has taught me that the 
attitude in general in the military is so much just part of the 
culture--to hope for the best and plan for the worst--and I 
would certainly like to believe that that is the case with 
those in charge of the nuclear bombs of this nation. So I want 
to give you the opportunity to either clarify my understanding 
of your plans for sequestration and its impact on this agency 
or on the alternative, if you have not made any plans and you 
tell me sequestration is going into effect in ten months, when 
do you intend to make plans?
    Mr. D'Agostino. I did not mean to be so flippant in my 
answer. Since I have spent many years in the military, we 
always do as you say, hope for the best, plan for the worst. 
You know, when I think of plans, I think of, well, particularly 
maybe in the context I think of a written-down document, you 
know, that has been approved in the organizations of, well, if 
this happens, we are going to implement Plan X, Y, and Z over 
here. I do not have that written-down document.
    We understand clearly our priorities, what it takes to do 
to take care of the stockpile. You know, number one, of course, 
is to make sure that today's stockpile, the one we have out 
there in the fleet right now, is safe, secure, and effective. 
There are surveillances going on on that particular stockpile. 
We are dealing with known problems and, of course, we do have 
problems in the stockpile, and that is why, unfortunately, I 
mean, it costs so much money to take care of it, to deal with 
those problems, so that this President and the next President 
has a stockpile that can do that.
    If we are in a situation where there is a dramatic drop-
off, if you will, 10 months from now and we will be in the 
position to identify the tradeoffs, if you will, and as we 
discussed this internally in the administration on what it 
would take, obviously we clearly do not want to have that to 
happen. But I know not only off the top of my head, but have a 
sense of structure on how we would go about and tackle this 
particular problem. But the last thing to come off the table is 
taking care of the weapons that we have in the stockpile today 
and making sure those get taken care of.
    But I do not want to leave you with the impression that I 
have kind of a written-down, dated, you know, or one ready to 
be dated and signed plan. We do not have that particular plan.
    Mr. Nunnelee. Mr. Chairman, maybe I could just request, I 
share your optimism that we are going to deal with this issue 
of sequestration, and I am going to be doing everything I can 
to make sure it does not happen. But as we get closer to that 
date it may be appropriate to have some type of forum to find 
out what is the plan in the event it does take effect on this 
very important agency.
    Mr. Frelinghuysen. The administrator, I think, spent a good 
portion of his eight years in the Navy on submarines, so I am 
sure there is a Plan B in the offing.
    Mr. Nunnelee. All right. Yes, sir. Thank you.
    Mr. Frelinghuysen. Thank you, Mr. Nunnelee. I just want to 
make sure that we are not--I think Mr. Visclosky and I have a 
few other questions. We should never have a hearing unless we 
talk a little bit about security here. And I want to obviously 
talk about in this setting what is appropriate.
    There has been over the years a focus of security at our 
labs and at times there were some concerns and some 
revelations. And also, we have obviously the added issue of 
cyber warfare.
    Mr. D'Agostino. Right.
    Mr. Frelinghuysen. Can you make some general comments about 
what you are doing?
    Mr. D'Agostino. Absolutely.
    Mr. Frelinghuysen. And we have this unified command in 
front of me to give us some assurances. We happened to have 
Secretary Chu in yesterday and we asked about a lot of the good 
talent that we had at our laboratories and we talked about, 
protecting intellectual property. And I think there was an 
admission that a lot of the good things we come up with in 
terms of ingenuity and ingeniousness and so forth, that 
sometimes it is pretty difficult to keep some of that from 
migrating----
    Mr. D'Agostino. Yes, sir, absolutely.
    Mr. Frelinghuysen [continuing]. Abroad. And I just wondered 
what you are doing----
    Mr. D'Agostino. Okay.
    Mr. Frelinghuysen [continuing]. These days----
    Mr. D'Agostino. Absolutely.
    Mr. Frelinghuysen [continuing]. In a world where we are 
under constant cyber attack and other things of concern to us.
    Mr. D'Agostino. Thank you, Mr. Chairman. A couple of things 
and I love this topic, so, hopefully, I will not take too long 
in the answer.
    If I can start off with the plan we put into effect about 
five years was just the idea of having less nuclear material in 
fewer sites across the country. It does two things for us. 
First of all, and most importantly, if you have less nuclear 
material spread around your country it is easier to secure and 
it is, therefore, more secure because you can focus your time 
and energy in fewer geographic locations. Second of all, it is 
a lot cheaper that way because instead of having to have lots 
of guards and guns spread out over multiple places, you can 
focus them.
    And the poster child on that, there are two of them 
actually, but the big one for us is the Lawrence Livermore 
Laboratory de-inventorying these high category quantities of 
nuclear material out of the laboratory. And we said we were 
going to get that done in 2012, and this is 2012 and we are 96 
percent of the way towards that goal of de-inventorying that. 
When that goes into effect, we will be in the position of being 
able to save $30 million a year on our security budget. And, in 
fact, the requests here that we have before the Committee 
reflects that adjustment. That is why you see the numbers going 
down in security. That is not because we care less about it. It 
is because we are doing it more efficiently.
    Mr. Frelinghuysen. You are referring mostly, I assume, to 
physical security.
    Mr. D'Agostino. Physical, right. So that vision we are 
going to push. I am pushing that on the environmental 
management side as well. I am aware of a couple of incidents 
where if we move a very small quantity of material from one 
geographic location to another, recognizing that there are 
local and regional political challenges associated with that, 
well, I can save money. So I am going to keep working the 
physical security side of it.
    On the cyber security side, which you asked about, first of 
all, there is an increase requested in the budget on cyber 
security for the chief information officer. We have 
consolidated the resources into one line that is in the request 
here and it goes up. The reason we have the increase is because 
we recognize that we need an architecture in place which we did 
not have before, not as robust as we could have had, where we 
are actually monitoring our overall network, not just the 
network of each of our geographic locations, which is what we 
had before where we were monitoring traffic between that 
network. And it is what the information experts term a cloud of 
clouds type of an approach.
    And we have a new chief information officer. His name is 
Bob Osborn that we brought from TRANSCOM that has been able to 
integrate the TRANSCOM information flow in a way to ensure the 
integrity of the movement of DOD materials around the world. 
Now we have got him working for us to apply that same principle 
on the security of the actual material itself.
    It is a huge problem. It is a very significant challenge. 
The Secretary is right that the laboratories have unique 
capabilities in this area and, in fact, a significant part of 
the work for others' work that happens, for other federal 
agencies, it is supporting those other agencies in this area. 
What we want to do is actually implement some of those benefits 
we are telling these other agencies about, which are usually 
very--they are highly classified, special access type programs, 
and take advantage of how we are helping other agencies and 
doing it so that we are ensuring that those tools are applied 
on our own structures.
    Now, you would normally think that that would happen 
naturally, but many of the agreements that we--these programs 
are so well compartmentalized that we want to try to flush out 
those left hand/right hand problems. You know, we are solving a 
problem with our left hand, but we are not actually applying it 
on the right hand.
    Mr. Frelinghuysen. So you are telling us basically that the 
enterprise is addressing this issue, you can give us some 
pretty strong assurance that across the board, no matter how 
many stovepipes there may be in laboratories, that you have, 
you know, a system here where you are dealing with the issue.
    Mr. D'Agostino. We are dealing with the issue. The question 
that I do not know the answer to, frankly, is whether it is 
adequate. What I do not know--I know that it is a very dynamic 
situation, the cyber security threat to our Nation overall. And 
I do not presume, frankly, for a minute that we know about all 
of the threats in this area, so that is why it requires 
constant attention.
    Mr. Frelinghuysen. Right. I hope you avail yourself of 
obviously other parts of, the federal workforce, but also 
people from the outside----
    Mr. D'Agostino. Yes, sir.
    Mr. Frelinghuysen [continuing]. You know, that can provide 
some information to you as well.
    Mr. D'Agostino. Okay. We will do that.
    Mr. Frelinghuysen. Thank you. Mr. Visclosky.
    Mr. Visclosky. Thank you, Mr. Chairman. Dr. Cook, it 
appears that prospects of achieving ignition at NIF in 2012 are 
not great. If we do not achieve ignition in 2012, what will 
happen as far as restructuring program plans to advance 
stockpile stewardship goals?
    Mr. Cook. The schedule for completion of the National 
Ignition Campaign was to complete that work by the end of '12. 
You are correct it was an objective in that program to achieve 
ignition and it is a very difficult task. There are still a 
number of months left, so, on the one side, someone could say, 
well, it is not possible, but, on the other side, I do not know 
of many people who would say, well, you know, it is assured. It 
is just not reasonable. It is a very demanding scientific 
challenge.
    It has been and it will remain our desire to utilize the 
National Ignition Facility as a facility for stockpile 
stewardship science, not solely limited to those areas of 
ignition, in '13 and beyond. So our plan is to use about two-
thirds of the time for stockpile stewardship science 
experiments. We will still retain about a third of the shop 
time on NIF for ignition work. I have given you a direct 
answer.
    There are many areas of stockpile stewardship science we 
have not been able to use NIF for, simply because it was 
devoted to achieving ignition at the earliest possible time.
    Do you have a follow-up question?
    Mr. Frelinghuysen. If the gentleman--we refer to this as 
the NIF Campaign, right?
    Mr. Cook. It is the National Ignition Campaign.
    Mr. Frelinghuysen. Yeah, I----
    Mr. Cook. Yeah, it is an enhancement----
    Mr. Frelinghuysen. When I was out there it was not working, 
but is it working now or where are we? Maybe you can answer 
that.
    Mr. Cook. On technical progress?
    Mr. Frelinghuysen. Yeah.
    Mr. Cook. Technical progress--we have closed the gap from 
where we were about two years ago to where we are now. I would 
say at one time it was an order factor of 100--I am sorry, of 
500. And so a factor of 50 of that gap has now been closed, a 
factor of 10 still remains. And often, you know, it is the last 
parts that are harder. The easier parts might be easy. So I am 
encouraged the big factor has been closed, but we still have 
the----
    Mr. Frelinghuysen. You are smiling a little bit.
    Mr. Cook. I just think this is an exceptional challenge and 
one of the reasons I am smiling is I know the people on the 
team. And there is nothing that brings smarter people and 
smarter minds to important work than a very hard problem. 
Achievement of ignition is a very hard problem.
    Mr. Frelinghuysen. So the campaign goes on.
    Mr. Cook. Oh, the effort to get ignition will absolutely go 
on. We will not have an enhanced management campaign for a 
period beyond the end of '12 into '13 because it was scheduled 
to be at the end of '12. And, frankly, I see some key 
advantages for stockpile stewardship science that will not 
undertake at the beginning of '13.
    Mr. Frelinghuysen. Mr. Visclosky, thank you for yielding.
    Mr. Visclosky. Yeah. Is there a doubt that they will 
achieve ignition someday at the National Ignition Facility?
    Mr. Cook. I supposed somebody could have doubts. I believe 
that good time and effort will get us to ignition on NIF in the 
course of time. Scheduling scientific breakthroughs, you know, 
while I might say it is impossible, it could look good on--it 
is just difficult.
    What is being achieved is real learning. So we have learned 
that our predictive codes for this work are not predicting 
adequately the experimental data. Now, that is actually a good 
thing because we are learning here. If we had not applied the 
engineering effort to get a vast suite of diagnostics in place 
to get precise data, we could not draw that conclusion. But now 
the diagnostics are in place and the code improvement effort 
has started, it will take some time to work through that.
    I believe that we will get ignition on NIF at some point 
and I think something that is going to be really important in 
getting there is also the team that is very talented in 
thinking having some time to think more. Right now because they 
are under the gun to do as much as they can by the end of '12, 
then they are doing a great deal of preparation for the next 
shot and less thinking about what they might need to do than I 
would say is optimal.
    Mr. Visclosky. I have been mistaken then in believing that 
you needed ignition at the facility as a component to ensure 
the success of stockpile stewardship.
    Mr. Cook. I would say that is not--I do not----
    Mr. Visclosky. No, I mean, I am wrong all the time.
    Mr. Cook. Yeah, I do not have that view. I do not wish to 
say you are mistaken. I will just say I do not have that view.
    Mr. Visclosky. I have been called worse today.
    Mr. Cook. There is a broad range of effort. You know, the 
effort that we----
    Mr. Visclosky. No, that was my impression.
    Mr. Cook. Okay.
    Mr. Visclosky. So I should disabuse myself of that.
    Mr. Cook. Well, I would say it is a key component.
    Mr. Frelinghuysen. I share his view. I mean, I am----
    Mr. Cook. It is a key component and not the only thing. 
When we can achieve burning plasma in the lab, then we can use 
the spectrum of a burning plasma which has a spectrum much like 
the output of a nuclear weapon to do some things that we could 
not do without that. Short of that, however, in NIF we have 400 
trillion watts of power. We have an ability to shape the 
spectrum to do work on things like radiation effects. We can do 
shock breakout. We do hydrodynamics. My view is that work that 
we can do to improve our codes that we use for weapon design is 
important aside from whether ignition is achieved or not. I am 
not saying ignition is not important.
    Mr. Visclosky. No, and I----
    Mr. Cook. I am just saying it is not the totality of the 
work.
    Mr. Visclosky. Okay. And I do not mean to----
    Mr. Frelinghuysen. Yield on that? I represent and shall we 
say look after, although I used to do a better job than I can 
do now, the Princeton Plasma Physics Lab and I hear obviously 
some of the same arguments here. But your area of 
responsibility is more important towards the nuclear 
enterprise, so I was of the opinion that the NIF was an 
essential part of your obligation towards modernization. I 
somewhat share sort of Mr. Visclosky's view as he described it.
    Mr. Visclosky. And I do not----
    Mr. D'Agostino. Yeah, I was just going to say NIF, the 
facility itself, the experimental work that goes on there, the 
code validation work that happens is absolutely essential to 
stockpile stewardship. We could not do stockpile stewardship 
without NIF. The ignition element of it, you know, achieving 
that very scientific milestone, is important as well, but we 
can do a tremendous amount and we are doing a tremendous amount 
of work on our stockpile even without achieving that ignition 
point. But the ignition point does drive the scientists. It 
provides a very clear kind of up or down check on achieving 
that and we want to get to the point where we would be able to 
use this facility as kind of the surrogate test site, if you 
will, you know, assuming 20 years from now how things go, to 
make sure that we maintain a cadre of people that are able to 
take care of that stockpile 20, 30 years from now when all of 
the test experience kind of is gone from all of us.
    Mr. Visclosky. I appreciate the chairman's indulgence. Just 
one other quick question on contractors and data on how NNSA 
evaluates their performance and awards fees. Traditionally, the 
department has not provided that evaluation. It appears that 
that practice is reversed and there is an indication that that 
information will be released. Do you have a timeframe for that, 
Mr. Administrator?
    Mr. D'Agostino. That is absolutely correct, we have 
reversed the decision. We are going to be providing more 
information. What we are working on right now is a consistent 
approach within the department. The Office of Science's 
approach is to provide a one-page summary, post that on the 
web, if you will, and then provide a link if an individual 
would like to get the next level of detail down to their 
particular side office.
    We are negotiating between kind of all of the elements of 
the department on how do we get that consistent approach. I 
would like to get this out within the next couple of months and 
make sure that it is actually out there kind of on the web in 
that consistent way.
    Mr. Visclosky. I appreciate it and I think it is very 
important because one of the concerns, as you know, I have is 
the issue of contract management. I talked about it in my 
opening remarks.
    Mr. D'Agostino. Yes.
    Mr. Visclosky. I do not want to belabor it. I will just 
say, as I told the secretary yesterday, he is now the seventh 
Secretary of Energy I have had the conversation with and I am 
tired of being on a GAO watch list. I really do respect your 
management skills and your determination to do a job, and just 
encourage you in that regard as well as the other issue I 
raised and that is the nuclear safety culture at Hanford.
    For too many years the department has passed that off as a 
disgruntled employee from time to time. I am heartened and 
appreciate that the department has conducted its own study and 
said there is a problem. So that, again, I appreciate----
    Mr. D'Agostino. Sure.
    Mr. Visclosky [continuing]. That steps are being taken and 
would encourage you in that regard. And again, I thank the 
chair for their indulgence.
    Mr. Frelinghuysen. Thank you.
    Mr. D'Agostino. Thank you.
    Mr. Frelinghuysen. Let me associate my remarks with Mr. 
Visclosky on the contracting as well as Hanford as well.
    Mr. D'Agostino. Yes, Mr. Chairman.
    Mr. Frelinghuysen. And it is almost high noon, so we are 
going to adjourn the meeting. And I want to thank you and the 
general and Dr. Cook for being here. I thought it was a very 
valuable hearing.
    We stand adjourned. Thank you very much.
    Mr. D'Agostino. Thank you, Mr. Chairman.

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                                            Tuesday, March 6, 2012.

  DEPARTMENT OF ENERGY--NUCLEAR NONPROLIFERATION AND NAVAL REACTORS, 
        NATIONAL NUCLEAR SECURITY ADMINISTRATION FY 2013 BUDGET

                               WITNESSES

THOMAS D'AGOSTINO, ADMINISTRATOR, NATIONAL NUCLEAR SECURITY 
    ADMINISTRATION
ANNE HARRINGTON, DEPUTY ADMINISTRATOR FOR DEFENSE NUCLEAR 
    NONPROLIFERATION, NATIONAL NUCLEAR SECURITY ADMINISTRATION
ADMIRAL KIRKLAND DONALD, DIRECTOR, NAVAL REACTORS, NATIONAL NUCLEAR 
    SECURITY ADMINISTRATION
    Mr. Frelinghuysen. Good morning. I would like to call the 
meeting to order. Administrator D'Agostino, last week we heard 
from you and your nuclear weapons representatives. Today we 
will receive testimony from the NNSA's Naval Reactors and 
Nonproliferation Programs. I would like to take this 
opportunity to welcome back all three of you to the committee.
    The programs and professionals you each represent are 
critically important to the national security of our country, 
and we thank you all for your work. I would also like to take a 
moment to recognize Admiral Donald for his extraordinary 
service to our Nation.
    Admiral Donald. Thank you, sir.
    Mr. Frelinghuysen. The post of Naval Reactors is an eight-
year assignment unique in the Navy for its length and its truly 
formidable responsibility. This is the final year of your 
eight-year tour and, therefore, the final time you will testify 
before this subcommittee as the head of Naval Reactors.
    I would also like to personally thank you for your 37 years 
of active duty service to this Nation, and for these past 8 
years, working tirelessly to assure the vitality of the Naval 
Reactors Program. I am sure that you have met the high 
standards that Admiral Rickover demanded, because I am sure 
that you were one of those that he tapped after a very vigorous 
examination. If he objects to what I have to say, I am sure we 
would hear from him. But I am sure he does not. So all of us 
are very proud of your work.
    Admiral Donald. Thank you very much.
    Mr. Frelinghuysen. Mr. Administrator, the breadth of 
programs that NNSA oversees is truly impressive. You maintain 
the nuclear weapons that provide a strategic umbrella for us 
and our allies. You run the programs around the world to keep 
fissile material out of the hands of those who would do us 
harm. You work with the Navy to ensure our submarines excel at 
their role as the silent leg of our triad. And you provide the 
science and analysis to protect us against strategic surprises.
    Last year, this committee showed that our Nation's 
strategic security could be maintained and even strengthened 
within the constrained resources. And as I said last week, the 
task before you is to demonstrate to us, to the American 
people, that these funding levels, while constrained, will 
ensure our country's strategic security.
    It is obvious to me as I look through the budget request 
that many hard decisions had to be made this year to work 
within constrained resources. The Naval Reactors' request is 
only $8.6 million above fiscal year 2012, a significant change 
from the steep escalation we were facing last year. Because of 
that escalation, Admiral Donald, the subcommittee asked you to 
take a hard look at your requirements and it is clear that you 
have brought back a very reasonable request for funding this 
year. I do thank you for your diligence, but understand there 
are still some difficulties in developing a path forward that 
will meet all the Navy's requirements in the out years. We will 
be interested to hear how these budget constraints may be 
affecting the needs of the operating fleet. That is important 
to us.
    For instance, the administration has announced that it will 
push back the OHIO Class Submarines Replacement Program by two 
years. This subcommittee has worked hard over the years in a 
bipartisan fashion to ensure adequate funding to support the 
development of the new reactor for this program.
    Submarines are an indispensable part of our strategic 
triad, and we are looking forward to hearing more on the 
changes to the OHIO Replacement Program and what other 
decisions could be around the corner that may impact our 
strategic posture. With respect to NNSA's nonproliferation 
activities, the funding requested for core nonproliferation 
activities is actually decreasing after taking into account the 
request to start a uranium enrichment development program and 
the cost growth in operations associated with the MOX program.
    For instance, the budget request would cut funding for 
megaports, part of the Second Line of Defense Program, by 65 
percent. That is an incredible cut to a program which just last 
year the administration was defending as a critical part of our 
Nation's effort to fight illicit trafficking of nuclear and 
radiological materials across international borders.
    I expect you will be able to offer a good explanation of 
why you are taking a different approach this year. Given the 
budgetary challenges facing this Nation, we must at all times 
take a look at our programs in whole new ways, seeking new 
efficiencies, innovation, and inspiration.
    Mr. Administrator, I think the laboratories under your 
jurisdiction can be an important source of new ideas, but 
tapping into that resource will require real improvements to 
the effectiveness of NNSA's federal oversight activities. 
Please keep this committee informed as you decide on what, if 
any, changes are needed to improve this situation.
    Mr. Administrator, please ensure that the hearing record, 
questions for the record, and any supporting information 
requested by the subcommittee are delivered in final form to us 
no later than four weeks from the time you receive them.
    Members who have additional questions for the record will 
have until the close of business tomorrow to provide them to 
the subcommittee office.
    So with that, I turn to Mr. Olver for any comments he may 
have.
    [The information follows:]

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    Mr. Olver. Thank you, Mr. Chairman. Mr. Administrator, it 
is good to see you again. And Ms. Harrington and Admiral 
Donald, welcome. Thank you all for being here. We too, at least 
now, maybe more, are interested in hearing your testimony, and 
being able to ask some questions of you on these important 
national security issues.
    Admiral Donald, I have just heard that this is probably 
your last appearance before this subcommittee and I think we 
all in the Congress wish you the best in the next chapter in 
your life, and thank you for your long service to our country.
    I am serving here in a deep utility position on these 
issues. So I am going to simply read a short statement that was 
prepared by and for the real ranking member, the real spokesman 
for this subcommittee on our side of the aisle who could not be 
here today. And so the word ``I,'' the utterance ``I'' in what 
I have to say really is coming from Mr. Visclosky, and we will 
have some questions along the way.
    The threat of nuclear terrorism is one of the greatest 
national security threats we face today. In its report, the 
bipartisan 9-11 commission found that, and I quote, ``The 
greatest danger of another catastrophic attack on the United 
States will materialize if the world's most dangerous 
terrorists acquire the world's most dangerous weapons.''
    Secretary of Defense Robert Gates, who served under both 
Presidents Bush and Obama, stated, and again I quote, ``Every 
senior leader when you are asked what keeps you awake at night, 
it is the thought of a terrorist ending up with a weapon of 
mass destruction, especially nuclear.''
    In April 2009, the President committed to an aggressive 
nonproliferation agenda to secure all vulnerable nuclear 
materials worldwide in four years, an objective that I wholly 
support. The 2013 budget request professes to support this 
commitment by proposing $2.5 billion for the nonproliferation 
account, an increase of $163 million over the 2012 enacted 
level. However, this increase is not to the core program. 
Rather, it is due to the inclusion of $150 million for the U.S. 
Enrichment Corporation and an increase to the Fissile Materials 
Disposition Program, neither of which contributes to securing 
vulnerable materials.
    Mr. Administrator, at your appearance before the 
subcommittee last week, I applauded the hard choices NNSA made 
in its budget request regarding nuclear weapons. However, I 
cannot do the same today. I have yet to be provided with any 
compelling reason for including the funding for USEC within 
nonproliferation. Further, I must point out that the increase 
in the account of USEC roughly corresponds to the drastic 
reduction in the Second Line of Defense Program. I cannot 
fathom an explanation that will be satisfactory for these 
changes given the importance of this mission, but I am here to 
listen to your justification.
    Admiral, the 2013 funding request for Naval Reactors 
funding is flat compared to the 2012 enacted levels. This 
represents a significant change of $144 million below the 
projected needs outlined in your budget last fiscal year. I 
understand this reduction is enabled by the Navy's decision to 
defer the OHIO Replacement by two years.
    I look forward to your insights regarding the modified 
program schedule as well as more details on how this initiative 
has changed since last year. Thank you, Mr. Chairman. I yield 
back.
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    Mr. Frelinghuysen. You did a great job for Mr. Visclosky. 
And let me just say to those of you who are wondering why there 
are so few members in the room. Chairman Rogers made it quite 
clear to all committee members that we were going to get our 
appropriations bills out on time. Sometimes people view 
Congress as being somewhat dysfunctional. We want to make sure 
that the appropriations process moves ahead as it did pretty 
well last year.
    To ensure this, we are modeling the process so there are a 
lot of committee meetings going on and members have other 
commitments, so there will be people drifting in and out of 
here. But thank you for pitching in for the ranking member. You 
did an excellent job.
    Mr. Administrator, the floor is yours. Thank you for being 
here, and also Secretary Harrington and Admiral Donald.
    Mr. D'Agostino. Thank you, Mr. Chairman, Mr. Olver. Good 
morning again, and thank you for having me back to discuss the 
President's fiscal year 2013 budget request. As I said last 
week, your ongoing support for the men and women of the NNSA 
and the work they do and your bipartisan leadership an some of 
the most challenging national security work has kept the 
American people safe, helped protect our allies, and enhance 
global security.
    As you know, earlier this month President Obama released 
his 2013 budget. I again want to assure you that NNSA is being 
thoughtful, pragmatic, and efficient in how we achieve the 
President's nuclear security objectives and shape the future of 
nuclear security. We have continuously improved the way we 
operate and we are committed to doing our part in this 
constrained budget environment.
    2013 is a critical time for us as we continue to work on 
some of our most important missions, which is supporting the 
President's commitment to secure the most vulnerable nuclear 
material across the globe. Our accomplishments in securing 
plutonium and highly enriched uranium around the world have 
made it significantly more difficult to acquire and traffic 
materials required to make improvised nuclear devices.
    And I am proud to say that we are on track to meet our 
goals to remove or dispose of 4,353 kilograms of highly 
enriched uranium and plutonium in foreign countries, and equip 
approximately 229 buildings containing weapons usable material 
with state of the art security upgrades by the President's 
fiscal year deadline.
    The defense nuclear nonproliferation budget request 
provides $2.46 billion to continue these and other critical 
nonproliferation and nuclear security efforts. Our continued 
focus on innovative and ambitious nonproliferation security 
efforts is vital. The threat is not gone and the consequences 
of nuclear terrorism and state proliferation would be 
devastating. Detonation of a nuclear device anywhere in the 
world would lead to a significant loss of life and overwhelming 
economic, political, and psychological consequences.
    We must remain committed to reducing the risk of nuclear 
terrorism and state-placed proliferation. The President's 
leadership on nuclear security issues and the funding he has 
requested for 2013 has sent a clear message around the globe. 
Just two years ago here in Washington, D.C., President Obama 
along with leaders from 47 nations began work on one of our 
most ambitious global security efforts of our time. They 
committed to the shared nuclear security responsibility and 
mission to keep materials out of the hands of terrorists. Later 
this month, the President and those world leaders will again 
reconvene in Seoul, South Korea, to review progress two years 
after the first summit and to recommit themselves to the shared 
mission, and to prevent nuclear proliferation, essentially to 
evaluate what has happened over the past two years and the 
challenges that they have laid out before us.
    This funding level request represents the American 
leadership, our piece of that work, working with other 
countries around the world. And it sends a signal, I believe, 
that it is a priority for this country and that our work is 
vital.
    But we know there is no silver bullet solution to this 
problem, and that is why we are looking forward to a 
multilayered strategy to strengthen security of nuclear 
material around the world by removing or eliminating it when we 
can, consolidating it and securing it if elimination is not an 
option, reducing the civilian use of highly enriched uranium, 
particularly for research and medical isotope productions where 
low enrichment options exist or can be developed, and 
maintaining our commitment to detecting the smuggling material 
around the world and movement of material around the world.
    We will continue to do research and development to advance 
our technologies to detect this material, as well as being able 
to track nuclear detonations should they occur. We will provide 
technical support and leadership to our interagency colleagues 
during the negotiation and implementation of arms control 
treaties as we did with New START. And we will expand our 
ongoing efforts to strengthen the capabilities of our foreign 
partners to implement international nonproliferation and 
nuclear security norms such as export control, verification, 
and all the training that is required in this particular area, 
and continue to work with the International Atomic Energy 
Agency.
    The President's budget request also keeps focus on our 
commitments to eliminate U.S. excess weapons material, and 
supports the Mixed Oxide Fuel Fabrication Facility and waste 
solidification building at the Savannah River site in South 
Carolina. The resources committed to the MOX and related 
activities this year will lead to the permanent elimination of 
enough plutonium for at least 8,500 nuclear weapons, which will 
be matched by similar commitments by the Russian Federation.
    As I said last week, we are not resting on old ideas to 
solve tomorrow's problems. We are shaping the future of nuclear 
security and we are doing it in a fiscally responsible way. We 
have eliminated the line item for the Pit Disassembly and 
Conversion Facility for the MOX program, opting instead for a 
preferred alternative approach to provide feedstock for this 
facility by utilizing existing facilities at the Savannah River 
site and the Los Alamos National Laboratory.
    This approach saves money, but it also represents ways in 
which we are finding efficiencies with the Department of 
Energy's Office of Environmental Management. We are also here 
this morning to discuss the President's budget request for 
NNSA's Naval Reactors Program, as Admiral Donald will detail 
for you in a minute.
    NNSA has helped American sailors reach destinations around 
the world safely and reliably for decades. And the $1.1 billion 
request for Naval Reactors will support the effort for OHIO 
class submarine replacement and looking at starting the 
modernization effort on key facilities and infrastructure. I 
will leave it to Admiral Donald to explain the specifics on 
this area for the U.S. Navy.
    Thank you again. I am proud of what we have done, and if I 
could request, Mr. Chairman, Admiral Donald provide a few words 
as well and an opening statement.
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    Mr. Frelinghuysen. Absolutely. I just want to find out 
whether, Madam Secretary, are you going to put your oar in the 
water here, too? I want to make sure that you----
    Ms. Harrington. I will defer to the expert.
    Mr. Frelinghuysen. Okay. Admiral Donald, the floor is 
yours. Thank you.
    Admiral Donald. Chairman Frelinghuysen, Mr. Olver, thank 
you very much for the opportunity to testify before you today 
on the Naval Reactors fiscal year 2013 budget request. I would 
also like to thank you for your support in allowing your 
committee members to recently visit our facilities in New York 
to see some of the work done firsthand by our laboratories and 
training facilities.
    My budget request is for $1.1 billion and the funding 
provides the resources required for the day-to-day work 
associated with a safe and reliable operation of 104 nuclear 
reactor plants, plants which provide power to more than 40 
percent of the U.S. Navy's major combatants, 11 aircraft 
carriers, 72 nuclear-powered submarines, including the most 
survivable leg of our nuclear deterrent, 14 ballistic missile 
submarines.
    The fiscal year 2013 budget also reports the President's 
national security strategy with continued development of the 
OHIO class replacement submarine and stewardship of our naval 
nuclear infrastructure. As you know, the Department of Defense 
has decided to delay the OHIO replacement submarine by two 
years. Our fiscal year 2013 request reflects that shift and 
supports the Navy's revised ship-building schedule while 
ensuring the continuity of our sea-based strategic deterrent.
    The budget further provides funding for the land-based 
prototype refueling overhaul, a critical aspect to the 
development of the life of the ship core for the OHIO class 
replacement. Core manufacturing, development and demonstration 
for a life of the ship core will be performed as a part of this 
project. By constructing the replacement core for the prototype 
with technologies planned for the OHIO class replacement, we 
will mitigate technical cost and schedule risk to that vitally 
important ship construction program.
    And finally, resources are requested for the 
recapitalization of the aging nuclear spent fuel handling 
infrastructure at the Naval Reactors Facility in Idaho. As you 
have recalled from previous testimony, we remain in compliance 
with the 1995 Idaho Settlement Agreement for movement of fuel 
from wet storage to dry storage, and ultimately for disposal. 
While working to meet this commitment to the people of Idaho, 
that aging infrastructure must also support the demands of a 
very challenging refueling schedule for the nuclear-powered 
fleet, including the refueling of the NIMITZ class aircraft 
carriers.
    Mr. Chairman, the Naval Reactors' budget request for fiscal 
year 2013 is consistent with the control set out in the Budget 
Control Act of fiscal year 2011. However, funding in the out 
years between fiscal year 2014 to 2017 is less than the Naval 
Reactors' validated requirements. Within these constraints, my 
first priority must be to safely sustain Naval Reactors' fleet 
support and regulatory oversight mission within our baseline 
funding, followed by the continued progress on three major 
projects: OHIO replacement, land-based prototype refueling 
overhaul, and recapitalization of the program's Spent Nuclear 
Fuel Handling Facility. Within the Budget Control Act funding 
constraints I cannot deliver these very important projects and 
maintain the proven standards of oversight and technical 
support that will continue to ensure nuclear fleet safety and 
effectiveness.
    Given the vital importance of our nuclear ships, the 
growing challenges of both a high operational tempo and an 
aging fleet, and the grave consequences of even the perception 
of eroding day-to-day standards and support, I must apply 
limited available resources to sustaining today's nuclear 
fleet, which prevents me from progressing on new projects 
absent some additional funding. As a result, the fiscal year 
2013 budget will maintain the land-based prototype overhaul to 
be executed in 2018.
    It will not support the recapitalization of the spent fuel 
handling infrastructure in time to support the existing plan of 
record for the refueling of CVN 73 USS George Washington. We 
are currently reviewing options as workarounds but all options 
will include some additional cost and risk. I will keep the 
committee apprised of that analysis.
    In addition, I am forced to further defer maintenance and 
facilities work, plus some decontamination and decommissionings 
across my laboratories. I have made these decisions with a full 
understanding of the impacts, and I judge them to be prudent in 
the current fiscal environment. And I sit here today before 
you, recognizing that this subcommittee must write its bill 
under some daunting fiscal constraints, more so than in 
decades.
    Prior to initiating the new projects in 2010, I embarked on 
a large-scale strategic alignment of funding as well as 
significant initiatives that have streamlined our support 
infrastructure and gained cost savings and efficiencies such as 
combining the maintenance and operations contract for my two 
laboratories. As you consider the many competing priorities 
before your subcommittee, I respectfully ask that you consider 
the contributions our program makes every day to our national 
security, and be required to make well into the future to meet 
our strategic objectives.
    Before I close, I would like to note an important milestone 
for Naval Reactors in the nuclear-powered Navy. This year marks 
the final deployment of the world's first nuclear-powered 
aircraft carrier, USS Enterprise. Commissioned in 1961, 
Enterprise will deploy for the very last time starting this 
month. No other ship better illustrates the success and 
evolution of the nuclear-powered Navy like Enterprise.
    Over her service life she has been a part of history from 
the Cuban missile crisis to Vietnam, from Operation Joint 
Endeavor in Bosnia and Southern Watch in the Persian Gulf, to 
Operation Enduring Freedom in 2001. More recently, Enterprise 
deployed to the Persian Gulf and Mediterranean supporting 
operations against Somali pirates and enforcing the No Fly Zone 
over Libya. After her final deployment, Enterprise will begin 
her inactivation in November of 2012.
    As you commented earlier, this is likely my last time to 
testify before your subcommittee since this year I will 
complete my tour as the director of Naval Reactors. It has been 
my privilege to work with you and I thank you and your members 
of your committee for all that you have done for Naval 
Reactors. Any success that we have enjoyed has been in part a 
result of your support and your stewardship of what we have 
done. So I thank you personally for all that you have done for 
the program.
    A written statement has been submitted along with 
Administrator D'Agostino's for the record, and I look forward 
to responding to any questions that you may have.
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    Mr. Frelinghuysen. Okay. Thank you very much, Admiral. 
Madam Secretary, any comments?
    Ms. Harrington. No, thank you.
    Mr. Frelinghuysen. We not only salute you, obviously we 
salute the Enterprise and all those sailors that manned her for 
decades. A remarkable contribution to our national security. 
And both Mr. Visclosky and I serve on another committee and 
there are eight reactors on it.
    Admiral Donald. That is correct.
    Mr. Frelinghuysen. And I understand, although this is not 
in my question script, but this decommissioning is going to 
take five years. Is it a five-year plan?
    Admiral Donald. Yes, sir, for the defueling part it.
    Mr. Frelinghuysen. Yes, defueling. But there is a lot of 
work to be done. Somebody asked me, and actually Mr. Dicks, 
who, unfortunately, has announced his retirement, did pose this 
question to our Defense Appropriations Committee because we had 
the CNO there as well as the substitute for the Marine 
Commandant. Why does it take five years, and how complex is the 
disassembling of that remarkable ship?
    Admiral Donald. Yes, sir.
    Mr. Frelinghuysen. Five years? Is this normal?
    Admiral Donald. Well, it is hard to characterize it as 
being normal since this is the first one that we have----
    Mr. Frelinghuysen. Is that what you would anticipate?
    Admiral Donald. It is. It is if you look at what needs to 
be done for the defueling portion of it, and that goes from 
fiscal year 2012 until fiscal year 2017, the preparations to 
get the plant ready for the defueling operation on eight 
reactors, and then the actual removal of the fuel itself in 
preparation for tow to the West Coast.
    We have a detailed schedule, a resource-loaded plan. That 
planning is well underway now and five years is the right time 
to be able to do all of that work.
    Mr. Frelinghuysen. It is quite a lot of money up front as I 
remember.
    Admiral Donald. Yes, sir.
    Mr. Frelinghuysen. Why is that?
    Admiral Donald. Over the course of the----
    Mr. Frelinghuysen. Because normally if you are going to do 
it over five years, you spread it over five years.
    Admiral Donald. Normally when we contract for something 
like that, a contract for the defueling, it is a single 
contract for the five years and we pay it, you know, all the 
money up front as a part of the defueling program. And if you 
are looking over the total of the program for that 5 years, it 
is about $1.3 billion all totaled to do that.
    Mr. Frelinghuysen. Yes, the comment was made and I am 
getting very tired of the expression, ``constrained 
resources.''
    Admiral Donald. Yes, sir.
    Mr. Frelinghuysen. We have got to come up with something a 
little better, ``fiscal climate'' or something.
    Admiral Donald. Certainly.
    Mr. Frelinghuysen. Since you have never done this before, 
is it out of the ordinary to put that much money up front, the 
whole load, as opposed to spreading it over five years? And 
given the environment that you are in----
    Admiral Donald. Sure.
    Mr. Frelinghuysen [continuing]. Why would those resources 
be spread over five years instead of up front to begin with?
    Admiral Donald. I would say two things. It is in keeping 
with what we have traditionally done for such large-scale 
programs as refueling overhauls of the aircraft carriers, which 
are large cost items, and that you issue a contract and you pay 
for that contract at the time of issuance and then you execute 
the work.
    The other thing that I would say is that we want to make 
sure that once we start into this that we can continue to 
progress with dispatch. You do not want to necessarily have to 
stop in the middle of the evolution when you have fuel being 
removed from this aircraft carrier. Once you start, you need to 
run it to completion.
    So whether that funding is up front or done in some other 
fashion, once you start it, you have to finish it, and then be 
ready to move the ship to its final----
    Mr. Frelinghuysen. Thank you for clarifying that. Admiral, 
previously you projected your needs to grow $150 million this 
year for the development of the OHIO replacement reactor 
systems. This year, your budget request instead includes a 
$31.6 million decrease. As you know, this program has been a 
shared priority between this subcommittee and your program for 
years.
    I understand that the Department of Defense has decided to 
delay, as has been mentioned on many, many occasions, the first 
ship procurement by two years. What are the reasons for the 
delay? And will this delay, and I think most importantly, 
result in any temporary gaps in our deterrence posture or the 
operational availability of our submarine fleet?
    Admiral Donald. Yes, sir, the delay really reflects an 
overall Navy review of the ship-building programs and overall 
acquisition programs, whether they be ship-building or 
aviation. And it was balancing the available resources to the 
strategic needs of the Navy, certainly as seen through the lens 
of the strategic review that was conducted by the Office of the 
Secretary of Defense and it was an attempt to balance those 
resources, recognizing that there was going to be some risk in 
many different programs. This happens to be one where 
determined that some risk could be taken and could be mitigated 
if you get out into the further use.
    Mr. Frelinghuysen. It is a risk that you personally have 
reviewed.
    Admiral Donald. Yes, sir, I have.
    Mr. Frelinghuysen. And, obviously----
    Admiral Donald. Yes, sir.
    Mr. Frelinghuysen [continuing]. They sought your input.
    Admiral Donald. Yes, sir.
    Mr. Frelinghuysen. I mean, there were a lot of things----
    Admiral Donald. Yes, sir.
    Mr. Frelinghuysen. Should we say, I will not put it on the 
chopping block, there are a lot of things that have been 
delayed sometimes because of cost overruns and----
    Admiral Donald. Yes. Yes.
    Mr. Frelinghuysen [continuing]. Issues relating to the 
littoral combat ship issue.
    Admiral Donald. Sure.
    Mr. Frelinghuysen. But this is something which you have had 
your hands on, obviously, the administrator has, and----
    Admiral Donald. Yes, sir.
    Mr. Frelinghuysen. There is nothing here that weakens our 
posture or the ability of our submarine fleet to operate the 
way it should be.
    Admiral Donald. I believe we are going into this with eyes 
wide open. And if you want to characterize the risk associated 
with it, the delay of two years will result in a period of time 
in the 2029 to 2041 timeframe when the force structure, the 
numbers of ships for the OHIO class, and the strategic 
deterrent will drop below what the combatant commander's 
requirements are. What the numbers are or the Navy's numbers 
are for the numbers of platforms, 12 is what the specified 
number for ships are to meet the combatant commander's 
requirements. We will drop below that number during that period 
of time. It would be about 10 ships during that period of time.
    Again, it is recognized that there will be some challenges 
associated with operation availability during that time, not 
unlike what we are seeing today with the exception that it will 
be an older fleet at that time, but that is something we 
understand. We understand the importance of sustained 
maintenance on those ships to ensure that they are ready to 
meet that mission, that we preserve them so they got their full 
life extension, the number of years of life. So, again, we 
understand what it is we have bought into, we understand that 
there are risks and we are putting measures in place to make 
sure that risk is mitigated.
    Mr. Frelinghuysen. We are counting on you. We are all too 
familiar with that expression the ``tyranny of distance''.
    Admiral Donald. Yes, sir.
    Mr. Frelinghuysen. And I must say when we had the CNO in 
and his Marine counterpart the other day, we were not, I think, 
as well reassured as we should have been that we are going to 
have the fleet that we need.
    Admiral Donald. Yes, sir.
    Mr. Frelinghuysen. Not only surface, but submarine, the 
silent fleet.
    Admiral Donald. Yes.
    Mr. Frelinghuysen. And so, we hope that this has been 
thought out and you are giving us assurance it has been thought 
out.
    Admiral Donald. It has been, and, again, it is not----
    Mr. Frelinghuysen. A lot of territory to cover.
    Admiral Donald. Not without risk, that is----
    Mr. Frelinghuysen. I know sometimes people say that the 
Chinese, it will take generations for them to catch up to us, 
but if they are mending a lot of submarines, maybe not with our 
capability, sometimes numbers in the overall equation do 
matter.
    Admiral Donald. Numbers do matter.
    Mr. Frelinghuysen. They do matter.
    Okay, Mr. Olver. Thank you.
    Admiral Donald. Yes, sir.
    Mr. Olver. Well, my impression is that you may have a good 
many more questions about the OHIO replacement issue, so, I 
will leave that mainly to you, but I cannot help but comment--
no, maybe I will make a couple of comments. When you----
    Mr. Frelinghuysen. You are the ranking. You can say 
anything you want. [Laughter.]
    Mr. Olver. When you, Mr. Chairman, are questioning the 
five-year decommissioning, is that likely to be a five-year 
decommissioning for each one of these nuclear power plants that 
we have to deal with or is that only going to be for the 
aircraft carriers?
    Admiral Donald. This particular program is unique to 
ENTERPRISE, which is one of a kind. It is an eight-reactor 
plant ship and the five years reflects that particular ship.
    Submarines, we have a long history of inactivation of 
submarines and those are much shorter, and so----
    Mr. Olver. Okay, all right. I was going to comment that in 
the utility industry, the decommissioning seems to go on 
forever. In the weapons system, in the defense system, you have 
places that you park the radioactive materials pretty 
automatically. They have been created over time. We have not 
quite figured out what to do with it, and, so, the first of the 
nuclear reactors for the utility purposes was in my district.
    Admiral Donald. Yes, sir.
    Mr. Olver. And was decommissioned back in the early 1990s, 
and they still have the waste material, the highly radioactive 
waste material sitting onsite.
    Admiral Donald. Yes, sir.
    Mr. Olver. Because we have not been able to figure out 
where to put it. So, this decommissioning process in its 
totality to actually deal with where the waste is going to be, 
it takes a lot longer time and we will have to figure out 
exactly where over that long time the naval reactor high-level 
waste will go, as well, will we not?
    Admiral Donald. Well, our spent nuclear fuel, when we 
remove it from the ships, its rail shipped to Idaho and the 
expended core facility, the expended core facility 
recapitalization project refers to that location where we take 
that.
    We are under obligation to the State of Idaho to move that 
spent fuel out of wet storage, where most of it is today, into 
dry canister storage, which we are doing as we speak, and it 
ultimately moves out of Idaho. But the plan as we go, yes, sir, 
we have a long-term plan to comply with the Idaho agreements. 
However, it is well understood absent Yucca Mountain or some 
other land repository for the ultimate disposal of this fuel, 
it will remain in the dry storage and in the Idaho facility 
until we come to a resolution on that. So, we do have an issue 
at the end of Idaho agreements in 2035 as to where that spent 
fuel will actually go, but it is in a safe and secure location 
right now.
    Mr. Frelinghuysen. Mr. Olver, will you yield just for a 
minute?
    Mr. Olver. Yes.
    Mr. Frelinghuysen. I want to assure you that Mr. Simpson 
will be here shortly. [Laughter.] I can hear a drum beat out in 
the hall.
    Mr. Olver. I should not have raised the question.
    Mr. Frelinghuysen. No, I think it is absolutely 
appropriate. I mean, these are agreements that need to be 
examined, and I am sure that if you do not, he will. Thank you 
for yielding.
    Mr. Olver. All right. I do not know what the timeframe here 
is given you and I; we seem to be having quite a good 
conversation already. But I will go on to a different thing, 
Mr. Administrator.
    Last year, your budget request indicated you would continue 
to ramp up the Second Line of Defense program in spending by 
nearly $1.8 billion over the 5-year period. This year, you have 
adopted a huge cut and I think probably it was the subcommittee 
itself that urged you to do something like this in part there. 
You have adopted a huge cut to this program, cutting the 
request by 65 percent and providing only $317 million over the 
5-year planning period. This is an abrupt and major change in 
direction.
    I look at the 5-year items and now it looks as if we are 
talking about $50 million to $60 million a year or thereabouts, 
whereas it was previously talked about as somewhere between 
$250 million and $500 million per year. So, why have you 
proposed such a major shift in the strategy and give us some 
insight into what activities you will conduct this year as you 
are shifting that strategy?
    Mr. D'Agostino. Mr. Olver, that is a great question and 
happy to answer it. I would also, with your permission, ask 
Anne Harrington, Ms. Harrington, to add on after I am done, if 
I could, please.
    I want to assure you, the committee, and our folks out that 
are implementing our Second Line of Defense Program that it is 
and remains an important component of our overall strategy. I 
mentioned in my opening statement about the idea of 
multilayering. That is not just good enough to secure material 
and protect it and account for it at all times, it is important 
for us to be able to detect the transfer of the material 
around, and the Second Line of Defense Program is an important 
element of that.
    We are not abandoning Second Line of Defense Program. We 
are taking the opportunity in this very difficult budget 
environment to set back, take an opportunity and refocus, and 
take a look at our program in making sure that we have the 
right strategy and that we are implementing it correctly with 
the Department of Homeland.
    What we are going to do with the resources we are 
requesting in fiscal year 2013 is to make sure that we have the 
right sustainability efforts and the get the right operational 
characteristics on our program. The program has been widely 
successful. It has implemented radiation-detection equipment in 
hundreds and hundreds of locations around the world, land, 
water crossing, seaports, and airports. And instead of just 
pressing forward to get large numbers of detectors out there, 
we are taking this opportunity to pause and look and making 
sure things are integrated and see how things move forward. We 
also in this constrained budge environment want to make sure we 
focus on getting the job done with respect to the President's 
commitment with his global leaders on securing material.
    I will ask Anne to add to my question because she runs the 
actual program itself in great detail.
    Ms. Harrington. Yes. Mr. Olver, thank you very much for the 
question.
    So, as the administrator said in his opening remarks, we do 
believe in a multilayered strategy. Right now, we are extremely 
focused on what we consider first line of defense: getting to 
the material at its origin or removing it and bringing it back 
here or to Russia. So, that is the four-year effort.
    Mr. Olver. Well----
    Ms. Harrington. The Second Life of Defense, yes?
    Mr. Olver. You say you still believe in the multilayered 
program.
    Ms. Harrington. Correct.
    Mr. Olver. Now, last year, you were talking about a program 
that would be completely in place at some 650 border sites and 
100 megaports by the year 2017. Now, either you changed how 
many megaports and how many border sites you really want to do 
or the multilayered program means that there are different 
kinds of things that you want, that you thought you wanted to 
do, and are now thinking that some of these are not as 
effective as others.
    Can you give us some insights as to what is somehow being 
knocked out or is it both a reduction in the total number of 
sites, megaports and border sites, or do you intend to do only 
parts of the multilayer, how ever many layers there are, and do 
only some of them, which you have somehow assessed to make sure 
that those are the ones that are most effective at succeeding 
with what your goal is?
    Ms. Harrington. Correct. We are trying to both address the 
vulnerable material to secure, remove, eliminate that material. 
That is the four-year effort. So, some of the shift is due to 
ensuring that we have the funding available for those 
activities because we believe that that is the primary pathway 
to reducing risk to the United States of terrorists ever 
securing that material and using it in a weapon.
    The second line of defense, of course, is aimed at reducing 
the risk from nuclear trafficking. So, much of our attention 
for the past 10+ years has been on Russia because Russia is 
where much of the materials that could be vulnerable is 
located. So, last year, toward the end of the year, we 
completed 383 air, sea, and land border crossings with 
radiation-detection equipment in Russia, helped them establish 
a consolidated control system, as I say, full partnership with 
Russia. We have both contributed in equal shares to the 
project. They have now taken full control as of the end of next 
year of sustainability for this project. This has gone very 
well.
    We have also worked on the countries surrounding Russia, 
but we thought it was appropriate at this point to take a step 
back and reassess where we are going to work next, how we are 
going to do that, and what kinds of partnerships, and 
particularly with what technologies. There are new technologies 
that may become available in the not too distant future, one of 
which has actually caused quite a bit of excitement in the 
scientific community. It comes out of Lawrence Livermore 
Laboratory, and if it is commercially-producible, if it is 
something that can be produced on industrial scale, it could be 
a game-changer in this field, which may mean we do not have to 
go with these big, very obvious detectors that we tend to 
install. We could be much more subtle. We could, perhaps, 
deploy systems in a way that make it more difficult for someone 
trying to evade a system to do so.
    We are looking at mobile systems, we are looking at hand 
detectors, we are looking at a variety of technologies and 
working in partnership with our other agencies and 
international partners to assess what combination of customs, 
border security, law enforcement do we need to engage to make 
these efforts work to the absolute maximum effect for the 
minimum amount of money. We will do a number of significant 
things in 2013 under that program.
    Mr. Olver. Well, I can relate somewhat to that because 
there used to be computers that took up the size of this room.
    Ms. Harrington. Exactly.
    Mr. Olver. And we now have far greater power in a laptop--
--
    Ms. Harrington. Correct.
    Mr. Olver [continuing]. Than was in those original 
computers. So, this technology can be moving very quickly.
    Ms. Harrington. Yes.
    Mr. Olver. Well, I am glad then to see that you are 
reassessing. We will see where we go next.
    Ms. Harrington. Right, and we are looking at an opportunity 
where we might have been able to install tens of detectors, 
with this new technology, perhaps hundreds. So, again, it could 
be a game-changer. But I also want to point out that we have 
not yet defined the 2014 to 2018 project trajectory for this 
program that will be done during the course of this year as we 
do this evaluation and determine what the best future path will 
be.
    Mr. Olver. I think I have in front of me a list of what it 
may be, but that may be subject to substantial change.
    Ms. Harrington. Correct.
    Mr. Olver. Because that is what you are saying.
    Ms. Harrington. Correct.
    Mr. Olver. Okay.
    Mr. Frelinghuysen. I think Mr. Olver and I would like to 
both get back into this after Mr. Alexander has had an 
opportunity.
    Mr. Olver. Okay.
    Ms. Harrington. Okay. Yes.
    Mr. Frelinghuysen. Mr. Alexander, thank you for being here.
    Ms. Alexander. Thank you, Mr. Chairman, and good morning.
    Mr. Frelinghuysen. Good morning.
    Mr. Alexander. I just wanted to make a statement that I 
would just like to take a moment to recognize that good work 
that Ms. Harrington is doing with NNSA. She has been to our 
office on occasions to talk to my staff and me about different 
things and upgrade us on the MOX project. We appreciate you 
giving us that knowledge. I would particularly like to thank 
two of your associates, Pete Hanlon and Kelly Cummins. They 
have been to see us and have brought us up to speed. We 
appreciate the way that they conduct their business and 
overall, we are happy with the progress that is being made at 
the MOX project, and we are confident in the direction that you 
are taking that project. And we hope that you will continue 
keeping the lines of communication open, let us know what we 
can do to help facilitate that and look forward to working with 
you and your staff. Thank you.
    Ms. Harrington. Thank you, sir.
    Mr. Frelinghuysen. Compliments are always welcome, I think. 
[Laughter.] I am sure they are well-earned.
    Now, I want to get back with Mr. Olver and he can jump 
right in, as well, to the issue here, and I know you have an 
interesting portfolio. I was intrigued by your comment about 
Russia stepping up to the plate. Now, we have made substantial 
investments.
    Ms. Harrington. Yes.
    Mr. Frelinghuysen. Considerable investments. Have the 
Russians matched those?
    Ms. Harrington. They have in several different areas.
    Mr. Frelinghuysen. In terms of dollars and cents?
    Ms. Harrington. Yes.
    Mr. Frelinghuysen. Yes.
    Ms. Harrington. Yes, in terms of personnel, purchasing 
equipment, installation, and real sustainability, and I have 
been to visit this consolidated response center that they have 
set up and it is very impressive. And they are professional----
    Mr. Frelinghuysen. It has been a few years since I was over 
there, but, initially, we put quite a lot of largess into these 
projects, and I was not sure whether they had substantially 
done the same type of investments.
    Mr. D'Agostino. I would say----
    Mr. Frelinghuysen. Mr. Administrator?
    Mr. D'Agostino. Mr. Chairman, if I could also add----
    Mr. Frelinghuysen. You have the floor.
    Mr. D'Agostino. In at least my recent visits in Russia, 
Anne's folks have done a remarkable job and our Russian 
colleagues, as well. Fifty-fifty cost share arrangements on 
detector equipment. We help with the installation, of course, 
but they have committed to the sustainability of these all on 
their own, out of their own security programs. We find strong 
support by the people that run the security facilities to 
maintain, sustain these facilities. It is not enough just to 
install the detectors, you actually have to operate them, use 
them, maintain them, and it does require resources. They have 
committed to doing that and they are full partners in this 
area.
    Mr. Frelinghuysen. So, you can assure us that the cost-
sharing can actually be validated, that they are actually----
    Mr. D'Agostino. It is----
    Mr. Frelinghuysen. I mean, sometimes people claim----
    Mr. D'Agostino. Right.
    Mr. Frelinghuysen [continuing]. Under the best of 
circumstances that they are doing things.
    Mr. D'Agostino. We have arrangements, different 
arrangements with different agencies. The federal----
    Mr. Frelinghuysen. There are different sites.
    Ms. Harrington. Correct.
    Mr. Frelinghuysen. From evaluations.
    Mr. D'Agostino. Right.
    Mr. Frelinghuysen. And so, we are taking a look at----
    Ms. Harrington. Correct.
    Mr. Frelinghuysen [continuing]. What they are claiming to 
do for us.
    Ms. Harrington. And the border crossings----
    Mr. D'Agostino. Yes.
    Mr. Frelinghuysen [continuing]. For themselves, I should 
say, and for----
    Ms. Harrington. Yes. Yes.
    Mr. Frelinghuysen [continuing]. Nuclear security worldwide.
    Ms. Harrington. Yes. Well, the border crossings are fairly 
transparent because you can physically see----
    Mr. Frelinghuysen. Yes.
    Ms. Harrington. And we know what we have paid for and we 
know what they have paid for.
    Mr. Frelinghuysen. But there are other sites----
    Mr. D'Agostino. We have Ministry of Defense sites.
    Mr. Frelinghuysen. Substantial, yes.
    Mr. D'Agostino. We have worked with the Russian Ministry of 
Defense. I have had the opportunity personally to review the 
Ministry of Defense sites. Because of the sensitivity of these 
sites, we rely on different ways to confirm that they are being 
maintained, but everything that we have seen so far is----
    Mr. Frelinghuysen. So, some have described this situation 
as trying to determine exactly what they are contributing as a 
challenge.
    Ms. Harrington. Yes.
    Mr. Frelinghuysen. You are saying there have not been 
issues of challenging their contributions?
    Mr. D'Agostino. In fairness, I mean, there are different 
challenges depending on which agency we are talking about. 
Mostly, the challenges, I mean, this is not a matter of just 
United States walking in any particular time saying----
    Mr. Frelinghuysen. Right, yes, access is rather limited as 
I remember.
    Ms. Harrington. Yes.
    Mr. D'Agostino. Absolutely.
    Mr. Frelinghuysen. Considering what we have put down on the 
table and assisted them.
    Mr. D'Agostino. Right.
    Mr. Frelinghuysen. And there are obviously other sites 
where they are doing things where we have no access at all.
    Ms. Harrington. Yes.
    Mr. D'Agostino. Right.
    Mr. Frelinghuysen. Just one comment and then I will go to 
Mr. Olver because it has taken a little bit of his space in his 
question.
    I serve on the Homeland Security Subcommittee, and 
sometimes I really wonder how you interact. You talked about 
multilayers. Maybe you have multilayers, but we have a huge 
bureaucracy here. There seem to be many hands on the deck here.
    Ms. Harrington. Yes.
    Mr. Frelinghuysen. I am not sure those hands are 
particularly well-linked, but I happened to have a briefing, 
and can you assure me that the Department of Homeland Security 
is wedded to whatever you are doing and that systems are 
talking to one another around here?
    Ms. Harrington. We have a very close relationship with 
Homeland Security and particularly with DNDO. We----
    Mr. D'Agostino. That is Domestic Nuclear Detection 
Organization.
    Ms. Harrington. Domestic Nuclear Detection Organization.
    Mr. Frelinghuysen. Yes. There is some sort of a 
directorate, is there?
    Ms. Harrington. There is.
    Mr. D'Agostino. Yes.
    Ms. Harrington. Yes. But we coordinate both on the 
detection issues as well as on radiological source security, 
training, and across a broad area.
    Mr. Frelinghuysen. I have a degree of discomfort. I just 
want to make sure that everybody is of working together here.
    Ms. Harrington. Yes.
    Mr. D'Agostino. Yes.
    Mr. Frelinghuysen. Yes.
    Mr. D'Agostino. If I could add----
    Mr. Frelinghuysen. Give me a little higher level of 
reassurance.
    Mr. D'Agostino. General Bob Kehler as a strategic command 
in Omaha has----
    Mr. Frelinghuysen. I am focused somewhat more on obviously 
the domestic-ish issue of how you----
    Ms. Harrington. Yes.
    Mr. D'Agostino. Well, I want to describe his responsibility 
for combatting weapons of mass destruction, and in this effort, 
he has brought together the Department of the Energy, the 
Department of Homeland Security, the Department of Defense 
Organizations, because there are more than one that works in 
this particular area. And we are looking very closely at making 
sure that--Warren Stern runs the Domestic Nuclear Detection 
Office in DNDO. He is an active participant in this group, and 
we are keenly focused on the fact that we do not want to 
duplicate efforts across departments because, obviously, that 
does not make any sense. We do not want to compete with each 
other on this wide breadth of work because we have to make sure 
that it all makes sense.
    So, Bob Kehler has worked very hard to help pull together 
kind of a framework on this front. We have had a number of 
sessions already at the leadership level and Ann does the same 
thing with her colleagues at Defense Reduction Agency and will 
be bringing in the DHS organization into that effort. We had 
what we call bridging meetings to bridge these organizations 
together.
    Mr. Frelinghuysen. I am all for bridging.
    Ms. Harrington. Right.
    Mr. Frelinghuysen. I want to make sure that----
    Mr. D'Agostino. Yes.
    Mr. Frelinghuysen [continuing]. You have your money and 
Homeland Security has its money.
    Mr. D'Agostino. Yes.
    Mr. Frelinghuysen. That somehow we are taking a look at----
    Ms. Harrington. Right. Right.
    Mr. Frelinghuysen [continuing]. Making sure we do not 
duplicate technology and things of that nature.
    Mr. D'Agostino. Right.
    Ms. Harrington. Correct.
    Mr. Frelinghuysen. Mr. Olver.
    Mr. Olver. Well, I guess I will take the bait----
    Mr. Frelinghuysen. Yes.
    Mr. Olver [continuing]. And continue this one for a bit.
    Ms. Harrington. Okay.
    Mr. Olver. I also serve on the Homeland Security 
Subcommittee, and we just had a hearing the other day where 
these issues of border-crossings and ports of entry came up 
there, and, clearly and obviously, in greatly different 
contexts. They are all border crossings across our borders into 
the U.S. and I was thinking of these 650 border sites and 100 
megaports. That was the goal. But I think what I understand is 
that you had 383 sites, was not that the number you mentioned?
    Ms. Harrington. That is just in Russia.
    Mr. Olver. I realize that.
    Ms. Harrington. Yes.
    Mr. Olver. That is just in Russia.
    Ms. Harrington. Just in Russia.
    Mr. Olver. Those are just sites in Russia.
    Ms. Harrington. Correct. So, our work is----
    Mr. Olver. Now, does that include some border sites and 
megaports?
    Ms. Harrington. Our work is all outside the United States.
    Mr. Olver. All outside the United States.
    Ms. Harrington. Outside of the United States, correct.
    Mr. Olver. Okay.
    Ms. Harrington. So, we are trying to keep material from 
moving into the United States.
    Mr. Olver. So, the definition of megaports, how many 
megaports are seaports and how many megaports are airports in 
your planning mode?
    Ms. Harrington. Currently, megaports only covers seaports.
    Mr. Olver. Then what are you doing with the airports? Are 
they just viewed as border sites?
    Ms. Harrington. They are. Currently, they are.
    Mr. Olver. How many of those sites are airports in Russia? 
How many of those 383 are airports in Russia?
    Ms. Harrington. I would have to get the count. It would 
cover any airport that has international connections. So, I 
would need to get the exact number, but, certainly, the ones in 
Moscow and St. Petersburg, et cetera.
    Mr. Olver. So, they are border sites in the sense that 
their----
    Mr. D'Agostino. Move out.
    Ms. Harrington. Right, that people could leave from there 
and come to the United States.
    Mr. Olver. Okay, okay.
    Ms. Harrington. Yes.
    Mr. Olver. So, they may be.
    Ms. Harrington. Yes.
    Mr. Olver. Ah, well, that is helping me a good deal in 
understanding what we are talking about here if I know that it 
is all outside the country.
    Ms. Harrington. Correct. Homeland Security does domestic 
issues and we----
    Mr. Olver. But you must have a bunch of megaports.
    Ms. Harrington. Yes.
    Mr. Olver. If you had 100 megaports, they are all over the 
place. How many of those are in place?
    Ms. Harrington. Correct. Right now, I believe it is 42 are 
in place.
    Mr. Olver. Forty-two?
    Ms. Harrington. Yes.
    Mr. Olver. Of the 100 that have been identified.
    Ms. Harrington. That were originally identified, right.
    Mr. Olver. Okay. Well, now, does this program as you are 
now conceiving it, does this then in its reduction, does that 
mean you are going to not go up from the 42 that are already 
there and completely implement them and the sites in Russia? 
How many sites are there outside Russia? I am thinking here the 
other major danger place for nuclear materials has to be 
Pakistan. How do you deal with Pakistan?
    Ms. Harrington. Well, Pakistan is its own special case. One 
could also argue that Iran is another source.
    Mr. Olver. Yes, but they do not yet have nuclear materials.
    Ms. Harrington. Well, they do have----
    Mr. Olver. Not weapon grade materials.
    Ms. Harrington. Not that we know.
    Mr. Olver. We hope.
    Ms. Harrington. Not that we know.
    Mr. D'Agostino. Yes, if I could mention just Pakistan. I 
think the Pakistanis are very serious about nuclear security. 
Anne's folks work very closely with their counterparts on 
detecting the illicit trafficking of nuclear technologies and 
nuclear and radiological materials. Anne's folks have also 
implemented a program with the Pakistanis in the Port of Kazan. 
It was what we call a secure freight initiative port, which is 
putting radiation detectors there. So, they take nuclear 
security very seriously and they are partners in this 
particular effort to detect the illicit trafficking.
    You had asked earlier about kind of the ratio. I did not 
ask for the ratio specifically, but how many in Russia and how 
many in other countries? Of the 420 sites or so that have been 
completed internationally, about 260 were in Russia and about 
161 I have in my notes are in other countries. So, the work in 
Russia was the initial slice of work that was started and that 
is essentially finishing up due to the cooperation. Now the 
effort is to kind of expand these----
    Mr. Olver. You realize that you have contradicted by about 
120 sites what Ms. Harrington was saying was the number of 
sites in Russia, which was 383.
    Ms. Harrington. Right.
    Mr. D'Agostino. Was that 300----
    Ms. Harrington. Yes.
    Mr. D'Agostino. Okay.
    Ms. Harrington. Total.
    Mr. D'Agostino. Total. Oh, total, total sites.
    Ms. Harrington. Yes.
    Mr. D'Agostino. I was talking about the land border 
crossings. So, this is a sub-element of the total.
    Ms. Harrington. Yes. Right.
    Mr. Olver. All right. Do we assume that we do not have a 
problem with any leakage of nuclear materials out of France and 
England? And then how do you deal with India and China?
    Mr. D'Agostino. I think that every country that takes 
nuclear security responsibly and very seriously, which I know 
the French and the UK does, never assumes that we have got the 
problem solved. We do not assume that we have the problem 
solved here.
    Mr. Olver. Do we have any sites in those nations?
    Mr. D'Agostino. There are----
    Mr. Olver. Or do we not feel we need sites in those 
nations?
    Mr. D'Agostino. We work very closely with the French and 
the British. They have radiation detector equipment installed, 
and I believe also the UK partnered with the United States for 
a Secure Freight Initiative port in their seaport in 
Portsmouth, as well, a number of years ago with the Department 
of Homeland Security. So, that was a joint effort between the 
Department of Homeland Security and the NNSA to work on the 
Secure Freight Initiative port in the UK.
    But, you know, I can assure you and the committee that I 
have regular contact with my counterparts in these other 
countries, and we are very clear about the kind of work we do. 
They are very clear about the kind of work they do. We are very 
confident that they have a robust program and take this as 
seriously as we do, as with the Russians that have come up to 
speed and have really demonstrated their resolve in this 
particular area.
    But anybody that does this kind of work for a living, 
whether it is in the Naval Reactors Program, whether it is part 
of my organization that deals with the weapons activities, 
whether it is on the civilian side, knows that this is an area 
of constant vigilance. And so we do not assume that we have it 
all solved, but that is why we keep going after it.
    Mr. Olver. Well, Mr. Chairman, I think I have explored 
almost more than I ever wanted to know.
    Mr. Frelinghuysen. Well, that is one of the benefits of 
being a ranking member, is that you are not going to be 
constrained by time limitations.
    Mr. Olver. But I do want to say there is some numerical 
difference between what the two of you are saying.
    Mr. D'Agostino. Yes. I was probably talking about a subset 
of what Ann was talking about, but we would be glad to provide 
details for the record on the actual numbers themselves, the 
650 and the 100, as you described earlier, and what we have 
done towards the 650 and the 100 ports.
    Mr. Olver. Well, then, one last question on this point. How 
many does this new budget direction anticipate you are actually 
going to deploy from this old goal of 650 and 100 megaports? 
Have you any idea about that or is that still up in the air, in 
flux?
    Ms. Harrington. Right now we need to finish the analysis 
that we are conducting right now. It will most likely be a 
reduced number, but that reduced number will be backed by some 
serious thinking.
    Mr. Olver. Okay. Thank you.
    Mr. Frelinghuysen. Great. We will get back, since we have 
the benefit of Admiral Donald here, to this institutional 
memory. And of course, the Department of Defense is taking a 
look at a lot of its procurement programs and high classes of, 
obviously a top priority. And I think the committee in a 
bipartisan way has been supportive, and we are still trying to 
get the cost down to, what is it, $4.9 billion per boat? Is 
that right?
    Admiral Donald. Yes, sir.
    Mr. Frelinghuysen. Yeah.
    Admiral Donald. That is the target.
    Mr. Frelinghuysen. That is the target. With the delay and, 
your having to somewhat contribute to the bottom line here, do 
you foresee any fundamental reconsideration of the requirements 
by the delay?
    Admiral Donald. No, sir. Not as a result of the delay 
itself.
    Mr. Frelinghuysen. Yeah. Instinctively, when you put 
something off for two years new technology, new bells and 
whistles, things that are important to our national security 
emerge.
    Admiral Donald. Yes, sir. From the perspective of Naval 
Reactors, we worked very hard in the concept development phase 
to try and identify those specific areas that we considered to 
be the most fruitful from a point of view of inserting new 
technology, and those were really in two areas. It was in the 
life of the ship core because we not only saw that as helpful 
in minimizing the amount of time that these valuable platforms 
spend in port for their maintenance, for their refueling, and 
the importance to the nation that they have the operational 
availability resulting from that. That was one.
    The second one was from a stealth point of view, which is 
one of the important security aspects of this platform. Being 
at sea, undetectable. If you look at the long-term or the 
future, what can we do today to best ensure that this ship 
remains essentially invulnerable its life? And the most 
important area we saw and we still believe this to be true 
today is to make sure that that ship is as quiet as it can 
possibly be. Technology that you have to build in up front, and 
that is where we focus, for instance, on the electric drive 
system to go into this ship.
    So, other than those two areas we continue to evaluate are 
there other things we want to do? And the answer to that is no. 
We are satisfied where we are. We are focused on trying to 
drive the cost of the propulsion plant in areas that were not 
advancing from a technology point of view, leveraging what we 
have learned off of VIRGINIA and the FORD class and 
complementing that with the advanced technologies in those two 
specific areas.
    So, I feel very comfortable that we have got the right 
areas targeted. Now, we have got to execute and drive the cost 
out to the extent that we can.
    Mr. Frelinghuysen. It will be remarkable when it is 
launched, I am sure.
    Admiral Donald. Yes, sir.
    Mr. Frelinghuysen. But we deal with the Department of 
Defense as set for a lot of programs, and this is one we 
support. Certain cost reduction goals----
    Admiral Donald. Yes, sir.
    Mr. Frelinghuysen. And it is almost like DOD/OMB.
    Admiral Donald. Yes, sir.
    Mr. Frelinghuysen. I mean, there is almost an Office of 
Management and Budget requirement that, certain goals be met. 
What happens, if those goals cannot be met and would that, in 
fact, figure into the fundamental reconsideration of the 
requirements that you have somewhat outlined?
    Admiral Donald. Yes, sir. If you look at the range of the 
OHIO class replacement, the cost that we are talking about per 
platform that we have been challenged to meet is between $5.6 
billion and $4.9 billion per platform.
    Now, over the life of the ship, it would take into 
consideration a learning curve as you build more of these 
things that become more proficient at it, to try and achieve 
more cost savings, but again I get back, we feel reasonably 
confident and by the time we go to construction on this ship--
--
    Mr. Frelinghuysen. So when you talk about construction, 
what is the timeline here? It seems to be a little bit fluid 
here, to say the least.
    Admiral Donald. Yes, sir. But two-year delay implies a 2021 
authorization for the first ship. What that means, if you back 
that up, is that I have to start purchasing the long-lead 
equipment, the heavy equipment for the reactor plant, not later 
than 2019, typically two years in advance. You back up from 
there, we have got the design work that has to go into building 
those components and the integration into a propulsion plant--
--
    Mr. Frelinghuysen. And then you have, obviously, what you 
referred to earlier. And this is true with a lot of ships, 
surface and submarine operations and maintenance?
    Admiral Donald. Yes, sir.
    Mr. Frelinghuysen. I assume the submarine has what we call 
a tail, right?
    Admiral Donald. Yes, sir. Absolutely.
    Mr. Frelinghuysen. Which you have got to know, like an 
aircraft, how much it is going to cost to maintain.
    Admiral Donald. Absolutely. Yes, sir. That is a part of the 
up-front design, to try and minimize the amount of maintenance 
that the ship needs over its life, to make sure that it can 
meet the commitments that it has to. All of that goes into it, 
and again I believe that from a point of view of technical 
feasibility from achievability based on what we have learned 
through the VIRGINIA program, which has been a successful 
program.
    Mr. Frelinghuysen. Well, the VIRGINIA program was supposed 
to put out two VIRGINIA class subs every year.
    Admiral Donald. Yes, sir.
    Mr. Frelinghuysen. This year, is it one?
    Admiral Donald. In fiscal year 2011 it was two, fiscal year 
2012 it is two. It remains at two per year, with the exception 
of fiscal year 2014.
    Mr. Frelinghuysen. Yeah.
    Admiral Donald. We go down to one that year, and that 
ship--
    Mr. Frelinghuysen. Why is that?
    Admiral Donald. That was, again, part of the overall 
consideration of the ship-building plan, resources----
    Mr. Frelinghuysen. That is sort of the gist of my question 
here, are there any upcoming milestones or decisions for the 
larger ship reduction that might impact your planning and 
resource requirements? I mean, there are a lot of moving parts 
here, yours being one that we are particularly focused and 
interested in.
    Admiral Donald. No, sir. I mean, we----
    Mr. Frelinghuysen. Pushing forward.
    Admiral Donald. The ship-building plan as it exists today, 
I mean, you know, it can certainly, with fiscal constraints and 
such things as sequestration and issues of that sort, could 
have some impact on it. Obviously----
    Mr. Frelinghuysen. Would have a pretty catastrophic impact.
    Admiral Donald. Yes, sir. It would, but absent that the 
program as it exists today, again, I am confident we can 
execute that. It is certainly not without challenge to be able 
to deliver that ship at that cost, but we understand what the 
challenge is and we are working as hard as we can to make sure 
that we meet it.
    Mr. Frelinghuysen. There have been a few people who have 
suggested we have a whole array of programs, but yours is 
pretty essential. This nuclear deterrent is something that we--
--
    Admiral Donald. Yes, sir.
    Mr. Frelinghuysen [continuing]. Strongly believe in.
    Admiral Donald. Yes, sir.
    Mr. Frelinghuysen. And we are supportive of and you have 
devoted your lives to. There has always been some talk, which I 
think worries me, about canceling the program. That is not 
going to happen, I hope.
    Admiral Donald. No, sir.
    Mr. Frelinghuysen. That is not something that we want to 
see here. So, what you want----
    Admiral Donald. No, sir. And to my knowledge, that has not 
been discussed in an official form.
    Mr. Frelinghuysen. Okay. There has been some talk in that 
regard.
    Admiral Donald. Yes, sir.
    Mr. Frelinghuysen. But the subs that we have now, you know, 
we cannot keep them going forever. This is something we need to 
get working on right now.
    Admiral Donald. Right. Yes, sir. In my view that would be 
catastrophic.
    Mr. Frelinghuysen. Correct.
    Admiral Donald. Yes, sir.
    Mr. Frelinghuysen. Okay. Mr. Olver, are you ready for some 
more?
    Mr. Olver. Well, you have opened another question, you went 
back to it, and so now I am ready to delve into it here. 
Because now I am a little bit confused.
    How many OHIOs are there?
    Admiral Donald. The OHIO class consisted of 18 ships 
originally.
    Mr. Olver. And how many are left?
    Admiral Donald. Four of those, the first four, have been 
converted from their strategic deterrent mission to become 
guided missile-shooting submarines. SSGNS as we call them. 
Those are no longer a part of the strategic deterrent.
    Mr. Olver. So there are only 14 left?
    Admiral Donald. Fourteen are left. That is correct, sir.
    Mr. Olver. Okay, that is fine. How many VIRGINIAs have been 
authorized?
    Admiral Donald. Well, authorized we have, let us see, we 
have delivered eight, with a ninth coming up here this year. We 
started in fiscal year 2011, two per year. And how many were 
authorized again? I would have to--let me get a specific 
answer. I think it is 12.
    Mr. Olver. Total?
    Admiral Donald. So far, yes, sir. It is a 30-ship class.
    Mr. Olver. A 30-ship class?
    Admiral Donald. Yes, sir.
    Mr. Olver. Total 30. That is the planning horizon on the 
part of the Navy?
    Admiral Donald. That is correct. Yes, sir.
    Mr. Olver. Thirty, okay.
    Admiral Donald. And those replace the ships that are 
retiring.
    Mr. Olver. When you say two, one was delivered last year in 
2011, did you say?
    Admiral Donald. That is correct.
    Mr. Olver. One VIRGINIA class?
    Admiral Donald. We had one delivered last year, the USS 
CALIFORNIA was delivered last year. Two were authorized for the 
2011 budget.
    Mr. Olver. There is a planning horizon, but then an 
authorization with specific numbers, the sum total, at least in 
your planning horizon, is at the 30 level?
    Admiral Donald. It is a 30-ship class, that is correct, 
sir.
    Mr. Olver. Okay. Let me just ask you, the ones that were 
authorized last year, when will they be commissioned? Is that a 
long period of time? Five to eight years?
    Admiral Donald. Five years.
    Mr. Olver. Five years at least?
    Admiral Donald. Yes, sir. Our target right now is a 60-
month cycle from commencing construction with authorization 
until delivery. The most recent ship delivered in 64 months, I 
believe it was, and we are moving towards 60 months now.
    Mr. Olver. I will get confused in my own numbers, 
eventually here. But in the case of the OHIOs, when was the 
first commission? And when was the last commissioned?
    Admiral Donald. The first one was around 1979, 1980. The 
last one was commissioned in the mid-1990s, I think it was 
1996.
    Mr. Olver. So from 1980 to 1995, say, is roughly right?
    Admiral Donald. Yes, sir.
    Mr. Olver. If any of this--I mean, hopefully nobody is 
taking notes about that.
    Mr. Frelinghuysen. Well, actually they are. They take 
plenty of notes, yeah. No, I think these are questions that 
need to be examined. Would you yield to me?
    Mr. Olver. Sure.
    Mr. Frelinghuysen. Is the administration considering 
further reducing the size of our ballistic missile submarine 
fleet because of this environment we are in here?
    Admiral Donald. The program of record right now calls for 
12 SSBNs, with the OHIO replacement going from 14 to 12. There 
is a period of time during the transition when the OHIOs are 
coming offline and the new class are coming online when we will 
dip below 10, but that is a recognized risk associated with the 
2-year delay. But right now, the plan still remains at 12 
SSBNs.
    Mr. Frelinghuysen. So if you will continue to yield here, 
if the Naval Reactors is not able to get the performance 
improvements it needs out of its new reactor designs to provide 
for a life of the ship core, does this drive back the number of 
replacement submarines that will need to be procured by the 
Navy?
    Admiral Donald. The rationale from going from 14 to 12 was 
that we would deliver on a life of the ship core, and 
eliminating the refueling that would occur in the midlife that 
occurs today on the OHIO class.
    Mr. Frelinghuysen. This is because of the design?
    Admiral Donald. That is correct, and that would imply that 
more ships would be necessary to meet the requirement for 
having ships at sea and ships available for the strategic 
mission. Yes, sir.
    Mr. Frelinghuysen. Mr. Olver, excuse me. Thank you for 
yielding.
    Mr. Olver. Well, that just opens up a different question on 
my part, which is we started with 18 of the OHIOs, which are 
now down to 14. We did not need the other four, we already 
converted them to some other purpose.
    Admiral Donald. Correct.
    Mr. Olver. We have 14 left. We have at most only 8 or 9 of 
the VIRGINIAs in place, so the total fleet is something like 
23. There may have been a time when the VIRGINIAs were already 
coming online before or at about the same time we were 
converting some of the OHIOs.
    Do you think we still are thinking about building a total 
of 30 VIRGINIAs? And, at the same time, going on and building 
another 12 of a more modern fleet? Are we in a worse military 
position now than we were when this whole business started out 
toward the middle of the Cold War, toward the end of the Cold 
War?
    There was the build up of the OHIOs, it was during the 
Reagan Administration.
    Admiral Donald. Right. If you look at fleet size right now, 
and I think what is missing from the conversation so far is the 
fact that while we are building VIRGINIA class submarines, 
older classes, the LOS ANGELES class submarines, are coming 
off----
    Mr. Olver. But they are not nuclear?
    Admiral Donald. Yes, sir. They are.
    Mr. Olver. Oh, really?
    Admiral Donald. Yes, sir.
    Mr. Olver. We have older submarines than the OHIOs?
    Admiral Donald. Yes, sir. The LOS ANGELES class started 
coming on service in 1973, with the last one of those built in 
1995. If you go back and look at the end of the Cold War in the 
1990 timeframe, when we were at our peak, we had approximately 
100 attack submarines and 41--no, there were already 40 or so 
SSBNs. Today, we have 54 attack submarines and 14 SSBNs.
    If you go out and look as the LOS ANGELES class----
    Mr. Olver. But the 100 that you had that long ago were much 
less capable than any of the----
    Admiral Donald. They, in fact, were less capable, that is 
true. The ships we are building today are better.
    Now, if you project out to 2026 timeframe, as a result of 
the older submarines coming offline and the VIRGINIAs coming 
online--older ones coming off faster because we built them 
faster, the new ones coming online slower because we are 
building them slower--the SSN force structure will get down to 
39 ships in around 2026.
    Mr. Frelinghuysen. Will the gentleman yield?
    Mr. Olver. Sure.
    Mr. Frelinghuysen. And then all the while where we are 
doing what we are doing----
    Admiral Donald. Yes.
    Mr. Frelinghuysen [continuing]. The Russians are developing 
a new submarine class, are they not?
    Admiral Donald. The Russians have a new----
    Mr. Frelinghuysen. And when we talk about capabilities 
here----
    Admiral Donald [continuing]. Ballistic missile submarine on 
service, and they have a new attack submarine that has just 
come on service, and the Chinese continue to build submarines 
at an aggressive rate.
    Mr. Frelinghuysen. A pretty aggressive rate.
    Admiral Donald. An aggressive rate, correct.
    Mr. Frelinghuysen. Yes, and they have some nuclear, right?
    Admiral Donald. They do, yes, sir.
    Mr. Frelinghuysen. But most of them are diesel.
    Admiral Donald. Most are diesels, but they are bringing 
nuclear onboard.
    Mr. Frelinghuysen. The sheer number is the issue here.
    Admiral Donald. Correct.
    Mr. Frelinghuysen. It should cause a fairly high degree of 
anxiety. Mr. Olver, excuse me. Thank you for yielding.
    Mr. Olver. Should it cause great anxiety on the part of 
China and Russia and the U.S., all of us. What about others? 
The oldest of the LOS ANGELES, now--I was trying to draw myself 
a list of what is in the fleet.
    Admiral Donald. Right.
    Mr. Olver. But I did not realize that there were much older 
ones than the ones that--are still operating. Are you still 
replacing their reactors?
    Admiral Donald. The----
    Mr. Olver. Or are those sort of going out of business as 
their fuel cycle is complete?
    Admiral Donald. The LOS ANGELES class, the first of half of 
that class, they did not have what we call a life of the ship 
core. So, most of those--many of those----
    Mr. Olver. But all the new ones are supposed to have a life 
of ship core.
    Admiral Donald. The second half of the class, the 31 ships 
in the second half of the class, all had life of the ship 
cores. So, those are just continuing to deplete and their life 
is determined by their hull life, which is 33 years. So, they 
retire at the 33-year point and, typically, they are typically 
running low on fuel. So, it works that both of them--that is 
when they reach obsolescence.
    Mr. Olver. What is the hull life of the OHIOs?
    Admiral Donald. The OHIOs right now is 42 years, 42 to 44, 
it depends on the operational life of the ship. That was 
extended from about 35 years based on some additional analysis.
    Mr. Olver. So those that were built in the middle 1990s 
have a hull life that goes on until at least 2030?
    Admiral Donald. They start coming offline in 2027.
    Mr. Olver. 2027. So they are going to be there; they are 
beginning to come offline in 2027.
    Admiral Donald. Correct, right.
    Mr. Olver. Which sort of fits with the idea that you have 
authorization for the replacements, the platforms at 2021, and 
commissioning is some years later.
    Admiral Donald. Correct. Yes, sir.
    Mr. Olver. It still is a possibility. So, the two years 
have not lost you anything because the lifetime of the OHIOs 
still goes--they must start to come offline by late 2020s.
    Admiral Donald. 2027, that is correct.
    Mr. Olver. Okay. Now for replacement of nuclear reactors, 
for refueling of nuclear reactors, those that are not lifetime, 
we do not have any yet that are online that are lifetime. Is 
that right?
    Admiral Donald. No, sir. We have the----
    Mr. Olver. VIRGINIAs are lifetime?
    Admiral Donald. Quick summary. The LOS ANGELES class that 
are in the fleet today all have life of the ship cores. The 
SEAWOLF class, there are three of those. They have life of the 
ship cores. The OHIO class have a midlife refueling, so at 
approximately the 20-year point or so they go in and have a 
midlife refueling. The VIRGINIA class are life of the ship 
cores for 33 years.
    Mr. Olver. Okay. I do not think I need a total----
    Mr. Frelinghuysen. You do not need any more encouragement.
    Mr. Olver. I was done anyway.
    Mr. Frelinghuysen. Mr. Olver.
    Mr. Olver. You want your turn?
    Mr. Frelinghuysen. Okay. Well, thank you. Since Ms. 
Harrington is here, I want to focus on North Korea. There have 
been reports that North Korea has agreed to stop nuclear tests, 
uranium enrichment, long-range missile launches, and allowed 
checks by nuclear inspectors, and to resume disarmament talks. 
These are encouraging developments. I have heard the Secretary 
of State weigh in, and obviously with a note of caution.
    NNSA has previously performed work in North Korea, 
verifying the shut-down of nuclear facilities there. How did we 
leave it when we left? And how would you characterize where we 
are now? When you left Dodge, when you left North Korea, where 
were you?
    Mr. D'Agostino. Maybe I will start. When we left we had 
taken down the cooling tower with the North Koreans. That was 
the tower that provided the cooling for their reactor. This was 
the reactor that was involved in production materials, 
obviously for a particular program. And also, you know, we just 
had a few people there working with the North Koreans in this 
particular effort, and then there was a period of time. The 
exact year escapes me. It was a few years ago, when we were 
told to leave and we left, of course.
    Since that time, just the recent news of course is very 
encouraging. Previously in our budget request we had 
resources--we had requested resources to be able to put 
together containers and the right tooling because there was 
going to be the question after you shut down the reactor and 
you want to de-fuel it, and then the fuel has to go somewhere. 
And it is a very involved process, and Ms. Harrington and folks 
do this and work with other countries and do this regularly. 
So, we were called to assist in that effort.
    Because there was this pause, we have not asked for those 
resources in the fiscal year 2013 request. The recent 
developments, of course, happened after our budget was 
submitted and proposed and was released publicly three or four 
weeks ago. So, if things progress we will obviously have to be 
nimble on our feet here and work with the committee on that.
    Mr. Frelinghuysen. We need to be realistic here. I served 
on the committee during the Clinton administration and we, you 
know, agreed to follow the direction of, the administration and 
the State Department. There were some lessons to be learned, 
but we need to think positively.
    Mr. D'Agostino. Right.
    Mr. Frelinghuysen. And I think any outreach must take into 
consideration all the talk about what the new leader might do 
to establish his reputation. This is not a bad signal coming 
from North Korea.
    Ms. Harrington. Correct, and we are in very tight 
coordination with our colleagues at the State Department. Rose 
Gottmoeller, who is now Acting Under Secretary, my counterpart 
Tom Countryman, Madelyn Creedon at the Defense Department, 
about how we will move forward. I think we are all in agreement 
right now that we are at the end of a beginning. The 
negotiation of the food package is underway.
    We have a very long way to go before we would, I think, be 
on the ground for nuclear issues again, but we have offered the 
full resources that we can provide to our colleagues at the 
State Department for technical backup on this, and we are ready 
to go back in if necessary.
    Mr. Frelinghuysen. Well, thank you. I want to shift gears. 
No hearing would be beneficial without talking about the MOX 
fuel fabrication facility. So, here we go.
    So, your five-year plan shows almost a billion dollars in 
operating costs for the MOX facility, not including project 
start-up costs for the facility that are funded as ``other 
project costs'' in the construction project.
    Buried in the project details, we have noticed a major 
change in the estimated annual costs of operating this 
facility. Your reported annual operating costs have ballooned 
to $500 million a year, over 2\1/2\ times the cost projected 
just 2 years ago when you stated they would be only $185 
million per year. To make matters worse, your request states 
that the current estimates ``should be considered 
preliminary.''
    Can you explain what is driving these costs up so 
substantially? And what do you think the ultimate cost will be?
    Mr. D'Agostino. These earlier presidential budget requests 
provide a projection out to the future on what we think the 
annual operating costs will be. These were done in advance of 
the construction experience that we have had, the understanding 
of the complexities associated with getting the right kind of 
people to operate the facility. The environment and the nuclear 
environment in this country has changed dramatically over the 
last few years. In many respects, what we have realized is that 
a nuclear-qualified operator is a precious commodity. Admiral 
Donald knows this, because of many of the folks, frankly, that 
end up in a commercial side end up being trained under the 
program.
    Mr. Frelinghuysen. We know that the Naval Reactors trains a 
lot of remarkable people that go into the private sector.
    Admiral Donald. And the public sector.
    Mr. D'Agostino. Yeah, I was one that did not make it into 
the private sector. Yes, sir.
    Mr. Frelinghuysen. We thank you, too, for many years, more 
than six years.
    Mr. D'Agostino. Thank you.
    Mr. Frelinghuysen. It is the longest-standing 
representative.
    Mr. D'Agostino. Thank you, sir. The challenge we have with 
these projections is that we are still projecting five years 
from now what it will cost to operate this facility. The MOX 
facility, as early as 2013 will begin looking at kind of some 
cold start-up operations, which is not really full-up 
operations, and then begin hot operations in the 2016 to 2018 
timeframe. So, we are still projecting out five years from now.
    But one thing we have learned is that we are going to have 
to compete very severely, very strongly to get the right kind 
of people to operate this facility.
    Mr. Frelinghuysen. Getting the right people to operate the 
facility is related to controlling the cost growth or does that 
fall into your shop?
    Mr. D'Agostino. Well, I am competing in the market for 
these people. It does not fall completely under my shop. There 
is recently a construction project just across the river at 
Plant Vogtle, which is drawing a lot of talent. We are 
competing to retain our people on the MOX project itself.
    Mr. Frelinghuysen. I think many of us are happy with what 
is going on over there. I think that is a good endorsement. I 
am pleased that the administration was there to endorse that.
    Mr. D'Agostino. I agree----
    Mr. Frelinghuysen. Basically, and a new generation of 
reactors, you know.
    Mr. D'Agostino. Yes, sir. A new generation of reactors and 
a new generation of operators for the resurgent nuclear 
industry.
    We happen to be on the front end of that, leading with 
respect to what essentially I would call the non-military side 
of the equation. This is why these costs are--we believe some 
of these costs are going up.
    I do not believe that is the full extent of the increase in 
dollars that we have in our budget. I will have to get back to 
you, because you described multi-hundred to 500 million dollars 
a year on operating costs, and I think maybe what we can do----
    Mr. Frelinghuysen. You have not challenged my figures, but 
I think----
    Mr. D'Agostino. Right.
    Mr. Frelinghuysen. There are some challenges here. I think 
the basic question is, if we have these challenges, you know, 
inherent in this project, why are you proceeding full speed 
ahead with start-up plans?
    Ms. Harrington. We can provide you with a detailed breakout 
of where these projections came from and why there have been 
some changes in the figures, and I think that will help you 
understand where we are going in the future.
    Mr. Frelinghuysen. Because there even have been issues 
like, there was some incident with people sent for training 
before--some people were sent abroad to be trained. Is that 
right?
    Ms. Harrington. No, that has not happened.
    Mr. Frelinghuysen. That has not happened? So there is 
nothing here. And is it true that the Navy pays $1 million to 
fully train a fighter pilot who must--oh, excuse me. There was 
talk of sending 90 employees to train in France before the 
facility was operational?
    Ms. Harrington. There will be training at the reference 
facilities in France prior to operations so that those people 
can come back and become the onsite trainers for all additional 
personnel who will work in the facility. But they have to be 
trained at the reference facilities.
    Mr. Frelinghuysen. So they are going or not going?
    Ms. Harrington. They will go at some point in the future, 
but at a time when it is appropriate.
    Mr. Frelinghuysen. When the challenges are further 
examined?
    Ms. Harrington. Correct.
    Mr. Frelinghuysen. Yeah. The Navy pays $1 million to fully 
train a fighter pilot who must serve for eight years of active 
duty. If we are investing $1 million per person, will these 
workers have any contractual obligation to remain employed at 
the facility through startup, assuming it ever starts up, and 
operation for 2017 and beyond?
    Ms. Harrington. I do not believe we are paying $1 million 
per person to train them. I think it is $1 million to train the 
90 people in France.
    [The information follows:]

                Additional Response From Ms. Harrington

    Because this is the first plutonium facility licensed by the NRC in 
the United States, the training includes providing direct hands-on 
training at the reference plants for operators in support of starting 
up and operating the MOX Fuel Fabrication Facility (MFFF). The design 
of the MFFF is based on two successfully operating plants in France. 
The reference plants are the La Hague facility, the reference plant for 
the Aqueous Polishing processes in the MFFF, and the MELOX facility, 
the reference plant for the Fuel Manufacturing processes in the MFFF.
    This funding includes a number of activities, including:
           Development of the training curriculum and all training 
        materials to be used by all operators at the MFFF;
           Development, translation and delivery of over 5,000 
        operating procedures to be used by all operators at MFFF; and
           Training of 93 personnel at the reference plants, who 
        will become the trainers for the remaining operators at MFFF.
    The 93 personnel that will receive training at the reference plants 
cover 45 different positions in the MFFF operations organizations and 
include a mix of senior management, mid-level managers/supervisors, 
operators, lab technicians, and maintenance and process subject matter 
experts. This represents approximately 20% of the eventual MFFF 
operators. The personnel will receive hands-on, on-the-job training in 
a plutonium environment on equipment similar to that being installed in 
MFFF. The training will be based on a tutoring system, where senior 
AREVA operators will act as tutors and be fully dedicated to train the 
MOX Services personnel. Training will be conducted on a one-on-one 
basis.
    The Department is also working with MOX services to develop a 
retention plan to ensure that the investment in the trained staff is 
fully capitalized.

    Mr. Frelinghuysen. Well, if we do train them, I think from 
our math it comes out to that figure. Mr. Olver?
    Mr. Olver. Thank you. Since you started now talking about 
MOX, Mr. Administrator, you mentioned in your testimony that we 
were on track to dispose of some 8 or 10 tons of highly 
enriched uranium and plutonium. But we do not have the MOX up 
and ready to go, so what are we doing to dispose of that now?
    Mr. D'Agostino. The uranium that we bring back, repatriate 
if you will because this is U.S.-flagged material that we are 
bringing back from reactors that we converted.
    Mr. Olver. But the MOX is not yet functional?
    Mr. D'Agostino. No, sir, the MOX is only dealing with the 
plutonium piece of the equation. We handle the uranium and 
plutonium a bit differently.
    Mr. Olver. The tonnage, then, is of both the uranium and 
plutonium?
    Ms. Harrington. No. We have a bilateral agreement with 
Russia under which we will each dispose of 34 metric tons of 
excess weapons plutonium. So that is the material that is 
subject to the MOX program. We also have an additional, 
approximately 9.4 tons of other plutonium that we could process 
through that plant should we choose.
    Mr. Olver. So then when the administrator spoke of 
removing, disposing of 4,000 kilograms, which would be a bit 
over 8,000 or 9,000 pounds or something, that gave me the 
tonnage that I mentioned.
    Ms. Harrington. Right. That is material outside the United 
States, yes. We have different amounts of material in and out 
of the United States.
    Mr. Olver. All right, but in your testimony you said that 
that was matched by the Soviets. Now the difference is, though, 
that the Soviets are burning the plutonium in a breeder 
reactor. We are intending under the MOX to make it into a dry 
oxide somewhere.
    Mr. D'Agostino. Yes, sir.
    Ms. Harrington. And they will do the same.
    Mr. Olver. Oh?
    Ms. Harrington. Yes.
    Mr. D'Agostino. Yes, the Russians----
    Mr. Olver. Ultimately?
    Ms. Harrington. Yes.
    Mr. Olver. But we are not using a breeder reactor process, 
so we are not actually using that for utility purposes?
    Ms. Harrington. Yes. Under the agreement, the 34 metric 
tons of weapons plutonium that the Russians will disposition 
also will not be in a reactor that breeds. It will only burn, 
and it will burn MOX fuel. But that is a condition of the 
agreement.
    Mr. Olver. I am beyond my----
    Mr. D'Agostino. I think the biggest change, sir, is in the 
past, in the original plan, the material would be both burned 
in light water reactors, both in the United States and in 
Russia. The amended plutonium management disposition agreement 
allowed for the Russians to not burn it in light water reactor, 
but burn it in a fast reactor. And burn it in a fast reactor 
such that they are not breeding additional plutonium. That is 
the key difference that happened. And you are absolutely right, 
there is that change that some would argue that says, well, you 
have walked away from the original agreement.
    Mr. Olver. They have walked away from the original 
agreement?
    Mr. D'Agostino. No, we do not believe they have walked 
away.
    Mr. Olver. The agreement was they were going to do one and 
we were going to do the other.
    Mr. D'Agostino. Yes, sir.
    Ms. Harrington. Yes.
    Mr. Olver. Oh.
    Mr. D'Agostino. It is confusing in that way.
    Ms. Harrington. And the Russians are well on track to meet 
the date by which we have agreed to both begin disposition and 
have, in fact, invested several billions of dollars into the 
construction of a new reactor for this.
    Mr. Olver. To do that.
    Ms. Harrington. Correct.
    Mr. Olver. Are we at the same level of progress for 
bringing the MOX on line?
    Ms. Harrington. We are at this point perhaps slightly 
behind the Russians.
    Mr. Olver. Okay. I will quit here whenever you want to give 
time to Mr. Womack, but otherwise I will go on.
    Mr. Frelinghuysen. Let us give Mr. Womack a chance to have 
a few words, if that is all right for a minute? Mr. Womack, 
thank you for being here.
    Mr. Womack. Thank you, Mr. Chairman, and look, I am going 
to be very brief because I have been in another hearing, and I 
came in to hear the tail end of this one. I just want to say, 
Mr. Chairman, what a great honor it is to be a member of 
Congress and be represented in the agencies by the panel that 
is before us today. Mr. D'Agostino, Admiral Donald, and Ms. 
Harrington have all been very gracious, just absolutely 
splendid cooperation in taking people with a very little 
working knowledge of the subject matter here and helping me 
achieve that learning curve. So I just want to say publicly, 
Admiral, Mr. D'Agostino, and Ms. Harrington, what a true 
pleasure it is to work with you through these issues and to be 
able to help your agency help America. So thank you so much.
    And I would be more than pleased to yield some of my time 
to the distinguished gentleman down to my right.
    Mr. Frelinghuysen. He must be talking about you. I would be 
happy to hook into that, but take the floor and then I have 
some questions and we may move towards some sort of a 
conclusion here.
    Mr. Olver. Well, I want to follow one other line, though I 
probably kind of jumped between my discussions enough. My 
understanding is that the U.S. Enrichment Corporation, which 
produces our enriched uranium for both utility purposes and for 
military reactor purposes, the Naval Reactors, is that correct? 
The enriched uranium for both of those purposes comes from that 
site?
    Admiral Donald. On the Naval Reactors side, no, sir, not 
today. The fuel stock for ours comes through dismantled 
weapons, and that work is done at Oak Ridge for us. But no, 
sir.
    Mr. Olver. All of the Naval Reactors' fuel is done at Oak 
Ridge.
    Admiral Donald. Correct, from dismantled weaponry.
    Mr. Olver. All right. Well, let me follow then with the 
administrator this line I am thinking here. Is the Paducah 
Plant slated to terminate this year, to end operation this 
year?
    Mr. D'Agostino. Well, the Paducah Plant is operated by the 
United States Enrichment Corporation, which is facing some 
significant challenges. We have proposed in our 2013 requests 
for a $150 million line item. Your comments in your opening 
statement, sir, described a section of the increase associated 
with nonproliferation is offset by this $150 million request. 
So actually the increase was not--the core work is not really 
this change; absolutely correct from that standpoint. What we 
believe is that it is very important for the United States to 
maintain an indigenous U.S. capability to enrich fissile 
material. It is important on a number of fronts. One of the 
fronts ultimately is to provide the material that Admiral 
Donald--people that follow on in the Naval Reactors program 
will absolutely need in order to keep our submarines and 
aircraft carriers operating because in order to--the other 
reason it is important is in order for me to have unencumbered, 
domestically produced, low enriched uranium so that I can 
continue to have tritium for our nuclear stockpile.
    But it is important on other fronts as well, particularly 
we believe that in order to avoid or want to discourage the 
unnecessary spread of enrichment technology, that other 
countries need to have confidence in the uranium enrichment 
market to be able to supply its needs. And that having a 
domestic U.S. capability, the country that, frankly, invented 
this technology in its infancy and developed this technology in 
its infancy, that confidence is absolutely important to market 
stability.
    But there is more. There are other reasons that Ann 
Harrington could talk about with respect to the 
nonproliferation benefits associated with having a domestic and 
indigenous capability in this country. That is why we feel it 
is important that we do not focus necessarily on USEC, the 
United States Enrichment Corporation, but we focus on what is 
the most promising technology to date to maintain an indigenous 
U.S. capability. And we believe that the technology that USEC 
has developed provides that opportunity.
    Ann, Ms. Harrington, if you would like to add to that, 
maybe some of the nonproliferation benefits associated with an 
indigenous capability would be helpful.
    Ms. Harrington. Or did you have another specific question 
there? I just want to underline----
    Mr. Olver. Why do you place it under nonproliferation if we 
are talking about the tritium material, and the tritium 
production is under Defense programs?
    Ms. Harrington. Yes, let me explain that. It might seem 
logical to put it there, but the R&D office that I have in my 
small universe is our resident repository of expertise on 
centrifuge technology. It is an area that we look at in terms 
of foreign weapons programs and so forth. So we have a fair 
amount of knowledge.
    We also have an extremely close working relationship with 
our colleagues in the Nuclear Energy Office at the Department 
of Energy, which also has interests here. We work very closely 
on this issue. But the main discussion of this issue has been 
on the NNSA side over the past year to 18 months, which is why 
it seemed logical to manage this next piece of the portfolio 
out of an R&D office that actually has the experience in 
running and assessing R&D projects.
    Mr. Olver. Okay. I think one could argue it either all 
belongs in one or the other, and maybe it is one of those cases 
where there needs to be internal cooperation----
    Ms. Harrington. Very much.
    Mr. Olver [continuing]. Along the way, so I will accept 
that one. Does the utility industry get its nuclear refueling 
supply all from this plant as it presently operates? If that is 
the only one that is U.S. owned that is making super enriched--
not super enriched, but----
    Ms. Harrington. No, there are a number of power plant fuel 
providers.
    Mr. Frelinghuysen. Would you just provide--they are based 
here, but would you just give Mr. Olver a view of the landscape 
here a little bit please?
    Ms. Harrington. Right. USEC is the only one that we can 
consider indigenously American and, therefore, appropriate to 
produce material that we would use for defense purposes.
    Mr. Olver. So the 100, plus or minus, utility power plants 
are buying from them or from others?
    Ms. Harrington. Or from other fuel providers.
    Mr. Olver. Do you know what fuel proportion is bought from 
USEC?
    Ms. Harrington. The material that comes out of USEC 
particularly, for example, USEC is a partner with the Russians 
in our HEU blend-down program where we have taken 500 metric 
tons of surplus Russian military highly enriched uranium and 
down-blended it in this country for use in our own power 
plants. One out of every 10 light bulbs in the United States is 
powered with that fuel. So they have a reasonable share of the 
market, but it is not a monopoly position in the United States. 
There is a uranium fuel market in the United States, and we can 
give you more information on that if you wish.
    Mr. Olver. I have a hard time measuring what the relativity 
is here on that scale.
    Mr. Frelinghuysen. I may jump in for a few more general 
questions, if I could. I just want to get back. I have been a 
little bit OHIO class-centric here. I am concerned about the 
billion dollars taken out of your five-year planning estimates.
    And in terms of you, Admiral, you are responsible for the 
prototype refueling project. You are responsible for the things 
occurring at Idaho. How is that going to impact your work in 
those areas?
    Admiral Donald. Yes, sir. Just one quick one, to correct 
one statement I made earlier about the number of authorized 
VIRGINIA class submarines. It is 16 through 2012.
    Yes, sir, if you look at the three major projects that we 
had discussed for the last couple of years, the funding that is 
in the budget for fiscal year 2013 supports continuing the 
land-based prototype core. It reflects the two-year slip in 
Ohio, which we have talked about. The one we have not touched 
on is the recapitalization of the expended core facility in 
Idaho.
    Mr. Frelinghuysen. For that you are requesting $50 million 
more.
    Admiral Donald. That is $28.6 million this year.
    Mr. Frelinghuysen. That is why----
    Admiral Donald. And it is less than what we----
    Mr. Frelinghuysen. Last year you had indicated you were 
going to be requesting $50 million more.
    Admiral Donald. Yes, sir. And where we stand with that one 
is that money, the $28.6 million this year, allows us to 
continue with the conceptual design of the new facility and it 
also allows us to continue the environmental protection, NIPA, 
the environmental protection assessment that we have to do. But 
the out-year funding does not support delivering the facility 
that we had discussed last year by the 2020 timeframe.
    Mr. Frelinghuysen. So is that why there is nothing in this 
request?
    Admiral Donald. We have some action to take to go back in 
and work with OMB to first evaluate options for fitting that 
project within existing top-line budgets and also to come back 
to OMB to provide some alternatives if that does not 
necessarily work.
    Mr. Frelinghuysen. But the projects needed it.
    Admiral Donald. It is absolutely needed. And it is factual 
that the facility as we envision it today, that bill will not 
fit underneath our top line in the out years if we continue to 
do the work we need to do for the fleet and support the fleet 
and others. So, we have a lot of work to do.
    Mr. Frelinghuysen. How would you characterize the 
robustness of the design that you have at this point?
    Admiral Donald. We are in the very early stages of the 
concept design work right now. So we have defined the facility, 
what we think it needs to do, and working on the specific 
location for the facility. But we are in the early design 
stages of that right now.
    Mr. Frelinghuysen. You will be requesting funding?
    Admiral Donald. Yes, sir.
    Mr. Frelinghuysen. For a design and construction?
    Admiral Donald. Yes, sir, we will.
    Mr. Frelinghuysen. And how much would you anticipate?
    Admiral Donald. I think it is early to answer that question 
right now given the work that we have to do with OMB over the 
next several months.
    Mr. Frelinghuysen. Admiral, shifting to the--I know that 
the administrator has environmental cleanup and management 
under his purview this year. Can you talk about the cleanup 
project in KAPL? You have $24 million requested.
    Admiral Donald. This is the SPRU?
    Mr. Frelinghuysen. Yes, the SPRU cleanup project.
    Admiral Donald. What I would recommend is I will give you 
the overview with respect to where Naval Reactors stands with 
that, and then it might be best for Mr. D'Agostino to answer 
the specifics of it.
    Mr. Frelinghuysen. There is $24 million requested in here, 
in part of this budget, in environment management?
    Admiral Donald. EM?
    Mr. Frelinghuysen. Mr. D'Agostino, in your shop?
    Mr. D'Agostino. I do not remember the exact number for 
SPRU. There are hundreds of projects that we fund, but I am 
actively involved in the SPRU project itself from the 
standpoint of getting this thing back on track. We had a 
problem about a year and a half ago or so with one of the 
subcontractors to our contractor on this particular project. As 
a result of that particular problem, some contamination was 
spread. As a result of that contamination spread, we had lost 
some confidence with our state regulator. So I have called in 
literally the leadership of the contract organization on this 
particular project, and we are holding each other to our 
commitment to get this thing done.
    I will take for the record what our exact number is, and we 
will get that submitted to the committee.
    Mr. Frelinghuysen. We are dealing with the issue 
satisfactorily?
    Admiral Donald. Yes, sir. We have a lot of work left to do. 
Just to be clear, the SPRU facility is on the Knolls Atomic 
Power Laboratory property, but it is not a part of the Knolls 
Atomic Power Laboratory. It is a separate facility, and the 
dividing lines are Naval Reactors, we are responsible for the 
capital facility. Knolls Atomic Power facility and EM is 
responsible for the SPRU. We obviously have a vested interest 
in this since the adjacent nature and also the engagement with 
the New York state regulators on this, and we are paying close 
attention to it.
    Mr. Frelinghuysen. It is being dealt with?
    Admiral Donald. Yes, sir.
    Mr. Frelinghuysen. Good. Mr. Olver, anything?
    Mr. Olver. Thank you, Mr. Chairman. I will be relatively 
brief here. I think we may have to have some additional 
conversation. I am told now by staff that USEC only provides 
about 20 percent of the enriched uranium that goes to our 
domestic power industry, which means there is a lot that the 
domestic power industry is getting from other places which I do 
not have any sense of. If you can enlighten me on where that 
is, either in writing or maybe even just a briefing of some 
sort, that would be fine.
    But this $150 million for some time, they have been trying 
to, and we have funded early on, really some eight years or so 
ago, started the funding of a different plan, using a different 
technique rather than gas diffusion to go to a different 
mechanism and a totally new plan. And I am curious on that 
because now that I know much of the industry is already getting 
it from other sources and seems to have figured out how to do 
that, and most of our domestic industry operates on the basis 
of long-term contracts for the enriched uranium that goes into 
those power plants, I am wondering why it is so important that 
we get into this whole new building of a program, which seems 
to be quite troubled if it was started in 2003, to build the 
plant in Ohio. Why are we headed forward on that one? It seems 
like one that is troubled and quite expensive.
    Mr. Frelinghuysen. Very expensive.
    Mr. D'Agostino. Our desire is, my desire, is to maintain a 
domestic or indigenous U.S. capability in enriching fissile 
material for national security purposes. I think it is 
critically important as we mentioned briefly earlier. On the 
tritium side, it is critically important on our ability to 
assess foreign countries' progress in enrichment technologies 
because we can do the types of R&D work on enrichment 
technologies that help essentially develop expertise in this 
area so we can advise intelligence agencies and others within 
the administration and future administrations on the progress 
of other countries that are making it in this area, whether 
they are making progress to advance their weapons programs 
counter to their obligations on treaties and the like. So I am 
thinking of it just from a personnel development standpoint and 
from a research and development capability alone, it is 
important for the U.S. to maintain this indigenous capability.
    You referenced this plant, I think, this activity, a 
research project activity, currently managed by the United 
States Enrichment Corporation. We believe not--I am not talking 
about United States Enrichment Corporation. We believe the 
technology that is developed is the closest and best 
opportunity for the U.S. to maintain a capability for national 
security purposes. It has the--for the reasons Ann mentioned, 
for the reasons I mentioned, and we did not get an opportunity 
to talk about the advantages that it provides to the Naval 
Reactors program in the out years. So we believe this is not 
$150 million to USEC per se. This is $150 million to develop an 
R&D program that the nonproliferation program will work with 
any on the structure of that particular program.
    We would be happy, of course, to meet with you on some of 
the specifics. And we do know that we will be providing the 
committee some additional information on some questions that we 
had received earlier prior to the hearing. So we would be glad 
to provide those, make sure you have those as well.
    Mr. Olver. I think I recognize that this is a much more 
complicated question than I thought it was.
    Mr. D'Agostino. Yes, sir.
    Mr. Frelinghuysen. It is complicated.
    Mr. Olver. I will quit there. Maybe we should have a 
briefing.
    Mr. Frelinghuysen. Yes. And it is almost high noon. The 
last word will go to Admiral Donald. There have been some 
manning issues. Would you comment on some of those?
    Admiral Donald. Yes, sir. I think one of the things as I 
come to the close of this tour I have been involved in, the 
thing that I take the greatest sense of reward about is the 
people that are associated with the program, those who are 
currently in and who have been associated with it in the past 
and what they do on a day-to-day basis. If you look at the 
enterprise--not the ship, but the nuclear propulsion 
enterprise--we are going through a unique time in our history 
in that the demographic shift that is in progress at our 
laboratories and our shipyards where our older workers are 
starting to move into well-deserved retirement. We have a large 
number of very bright young folks coming in at the beginning of 
the program. And we have been very fortunate over the last 
several years. The recruiting environment has been very good; 
maybe the economy not so good, but from a recruiting point of 
view, very good. We brought very good people in. Now the 
challenge before us is to keep those good young people in, 
continue to hire to replace the folks who are retiring, and 
transfer the knowledge from the senior folks to the junior. 
That is in progress as we speak right now and why it is 
important that we keep the hiring and training and retention 
programs in place that we have right now.
    Mr. Frelinghuysen. This is a part of our industrial base 
and we obviously pay tribute to other parts of our industrial 
base, which, you know, there has been erosion which I think is 
important that you emphasize.
    Admiral Donald. Yes, sir. We pay close attention to this. 
Yes, sir.
    Mr. Frelinghuysen. We have some remarkable people that work 
for you and all of you, and we pay tribute to them. Their work 
is essential, and again we want to thank you for your many 
years in service to our nation.
    And with that, we stand adjourned. Thank you very much.

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