    [House Hearing, 113 Congress]
    [From the U.S. Government Publishing Office]

                      DOE MANAGEMENT AND OVERSIGHT OF ITS
         NUCLEAR WEAPONS COMPLEX: LESSONS OF THE Y-12 SECURITY FAILURE

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

                                    HEARING

                                   BEFORE THE

                  SUBCOMMITTEE ON OVERSIGHT AND INVESTIGATIONS

                                     OF THE

                        COMMITTEE ON ENERGY AND COMMERCE
                            HOUSE OF REPRESENTATIVES

                        ONE HUNDRED THIRTEENTH CONGRESS

                                 FIRST SESSION

                                   __________

                                 MARCH 13, 2013

                                   __________

                               Serial No. 113-13

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

          Printed for the use of the Committee on Energy and Commerce

                            energycommerce.house.gov

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                        COMMITTEE ON ENERGY AND COMMERCE

                              FRED UPTON, Michigan
                                     Chairman
    RALPH M. HALL, Texas                 HENRY A. WAXMAN, California
    JOE BARTON, Texas                      Ranking Member
      Chairman Emeritus                  JOHN D. DINGELL, Michigan
    ED WHITFIELD, Kentucky                 Chairman Emeritus
    JOHN SHIMKUS, Illinois               EDWARD J. MARKEY, Massachusetts
    JOSEPH R. PITTS, Pennsylvania        FRANK PALLONE, Jr., New Jersey
    GREG WALDEN, Oregon                  BOBBY L. RUSH, Illinois
    LEE TERRY, Nebraska                  ANNA G. ESHOO, California
    MIKE ROGERS, Michigan                ELIOT L. ENGEL, New York
    TIM MURPHY, Pennsylvania             GENE GREEN, Texas
    MICHAEL C. BURGESS, Texas            DIANA DeGETTE, Colorado
    MARSHA BLACKBURN, Tennessee          LOIS CAPPS, California
      Vice Chairman                      MICHAEL F. DOYLE, Pennsylvania
    PHIL GINGREY, Georgia                JANICE D. SCHAKOWSKY, Illinois
    STEVE SCALISE, Louisiana             ANTHONY D. WEINER, New York
    ROBERT E. LATTA, Ohio                JIM MATHESON, Utah
    CATHY McMORRIS RODGERS, Washington   G.K. BUTTERFIELD, North Carolina
    GREGG HARPER, Mississippi            JOHN BARROW, Georgia
    LEONARD LANCE, New Jersey            DORIS O. MATSUI, California
    BILL CASSIDY, Louisiana              DONNA M. CHRISTENSEN, Virgin
    BRETT GUTHRIE, Kentucky                  Islands
    PETE OLSON, Texas                    KATHY CASTOR, Florida
    DAVID B. McKINLEY, West Virginia     JOHN P. SARBANES, Maryland
    CORY GARDNER, Colorado               JERRY McNERNEY, California
    MIKE POMPEO, Kansas                  BRUCE L. BRALEY, Iowa
    ADAM KINZINGER, Illinois             PETER WELCH, Vermont
    H. MORGAN GRIFFITH, Virginia         BEN RAY LUJAN, New Mexico
    GUS M. BILIRAKIS, Florida            PAUL TONKO, New York
    BILL JOHNSON, Missouri
    BILLY LONG, Missouri
    RENEE L. ELLMERS, North Carolina
                  Subcommittee on Oversight and Investigations

                            TIM MURPHY, Pennsylvania
                                     Chairman
    MICHAEL C. BURGESS, Texas            DIANA DeGETTE, Colorado
      Vice Chairman                        Ranking Member
    MARSHA BLACKBURN, Tennessee          BRUCE L. BRALEY, Iowa
    PHIL GINGREY, Georgia                BEN RAY LUJAN, New Mexico
    STEVE SCALISE, Louisiana             EDWARD J. MARKEY, Massachusetts
    GREGG HARPER, Mississippi            JANICE D. SCHAKOWSKY, Illinois
    PETE OLSON, Texas                    G.K. BUTTERFIELD, North Carolina
    CORY GARDNER, Colorado               KATHY CASTOR, Florida
    H. MORGAN GRIFFITH, Virginia         PETER WELCH, Vermont
    BILL JOHNSON, Ohio                   PAUL TONKO, New York
    BILLY LONG, Missouri                 GENE GREEN, Texas
    RENEE L. ELLMERS, North Carolina     JOHN D. DINGELL, Michigan
    JOE BARTON, Texas                    HENRY A. WAXMAN, California (ex
    FRED UPTON, Michigan (ex officio)        officio)

                                 C O N T E N T S

                                  ----------
                                                                       Page
    Hon. Tim Murphy, a Representative in Congress from the
      Commonwealth of Pennsylvania, opening statement................     1
        Prepared statement...........................................     3
    Hon. Diana DeGette, a Representative in Congress from the state
      of Colorado, opening statement.................................     4
    Hon. Fred Upton, a Representative in Congress from the state of
      Michigan, opening statement....................................     5
        Prepared statement...........................................     6
    Hon. Michael C. Burgess, a Representative in Congress from the
      State of Texas, opening statement..............................     7
    Hon. Henry A. Waxman, a Representative in Congress from the State
      of California, opening statement...............................     8

                                   Witnesses

    Sandra E. Finan, Brigadier General, USAF, Commander, Air Force
      Nuclear Weapons Center and Former Acting Chairman of Defense
      Nuclear Security, National Nuclear Security Administration
      (NNSA).........................................................     9
        Prepared statement...........................................    11
    Daniel B. Poneman, Deputy Secretary, U.S. Department of Energy,
      Accompanied by Neile L. Miller, Acting Undersecretary for
      Nuclear Security and Acting Administrator, NNSA................    27
        Prepared statement...........................................    29
        Answers to submitted questions...............................   181
    Richard A. Meserve, President, Carnegie Institution for Science..    56
        Prepared statement...........................................    58
        Answers to submitted questions...............................   191
    C. Donald Alston, Major General, USAF (Retired)..................    57
        Prepared statement...........................................    58
        Answers to submitted questions...............................   191
    David C. Trimble, Director, Natural Resources and Environment
      Team, Government Accountability Office.........................    83
        Prepared statement...........................................    85
        Answers to submitted questions...............................   193

                               Submitted Material

    Document binder..................................................   116

    DOE MANAGEMENT AND OVERSIGHT OF ITS NUCLEAR WEAPONS COMPLEX: LESSONS OF
                           THE Y-12 SECURITY FAILURE

                                  ----------

                           WEDNESDAY, MARCH 13, 2013

                      House of Representatives,
          Subcommittee on Oversight and Investigations,
                              Committee on Energy and Commerce,
                                                        Washington, DC.
        The subcommittee met, pursuant to call, at 10:10 a.m., in
    room 2322 of the Rayburn House Office Building, Hon. Tim Murphy
    (chairman of the subcommittee) presiding.
        Members present: Representatives Murphy, Burgess, Harper,
    Gardner, Johnson, Barton, Upton (ex officio), DeGette, Braley,
    Lujan, Tonko, Green, and Waxman (ex officio).
        Staff present: Carl Anderson, Counsel, Oversight; Charlotte
    Baker, Press Secretary; Mike Bloomquist, General Counsel; Annie
    Caputo, Professional Staff Member; Karen Christian, Counsel,
    Oversight; Andy Duberstein, Deputy Press Secretary; Kirby
    Howard, Legislative Clerk; Peter Kielty, Deputy General
    Counsel; Peter Spencer, Professional Staff Member, Oversight;
    Tiffany Benjamin, Democratic Senior Counsel; Brian Cohen,
    Democratic Staff Director, Oversight and Investigations, and
    Senior Policy Advisor; Elizabeth Letter, Democratic Assistant
    Press Secretary; and Stephen Salsbury, Democratic Special
    Assistant.

       OPENING STATEMENT OF HON. TIM MURPHY, A REPRESENTATIVE IN
             CONGRESS FROM THE COMMONWEALTH OF PENNSYLVANIA

        Mr. Murphy. Good morning. We convene this hearing to
    continue the committee's examination of Department of Energy's
    management and oversight of its nuclear weapons complex, three
    national weapons laboratories and five production and testing
    facilities. These eight sites are responsible for the
    stewardship of our Nation's nuclear weapons stockpile.
        DOE, through its National Nuclear Security Administration,
    or NNSA, spends billions of dollars each year performing
    hazardous operations to maintain and secure nuclear weapons and
    weapons materials. This work is performed by contractors at the
    Department's nuclear weapons sites under the supervision of
    federal officials and requires strict adherence to strong
    safety standards. The supremely sensitive nature of the
    materials and technologies also requires the Department to
    ensure an extraordinary level of security to safeguard these
    nuclear sites and operations.
        Our attention today will focus mainly on the lessons for
    the Department from the security and oversight failures that
    occurred last summer at the Y-12 National Security Complex, in
    Oak Ridge, Tennessee, and what DOE is doing to address these
    lessons.
        At its hearing this past September, this subcommittee began
    to examine preliminary information about the failures at Y-12.
    We learned how these failures allowed three protestors at
    around 4:20 a.m. one morning last July to penetrate security
    fences and detection systems and deface the walls of the
    facility storing highly enriched uranium. We learned about
    inexcusable maintenance problems and compensatory security
    measures to work around broken equipment and chronic false
    alarms. We learned about the inadequate response by the
    protective guard force. And most to the point of our hearing
    today, we learned about the failure of contractor governance
    and federal oversight to identify and correct the multiple
    early indicators of Y-12's security, maintenance, and
    communications systems breakdowns.
        The DOE Inspector General's testimony at that hearing
    revealed that federal site officials did not do anything to
    address security maintenance backlogs because NNSA's contractor
    governance system meant ``they could no longer intervene.''
    This perhaps is the most incomprehensible aspect of this
    troubling situation. It appears that, due to a ``hands off''
    federal contracting policy, we had ineffective federal security
    oversight at Y-12, and potentially at other sites around the
    complex.
        Information produced since September confirms that a strong
    oversight approach to security has not been paramount at DOE,
    particularly since the Department instituted certain reforms to
    its oversight in 2009 and 2010. The stated purpose of these
    reforms was to give contractors flexibility to tailor and
    implement safety and security programs ``without excessive
    federal oversight or overly prescriptive departmental
    requirements.'' Whatever the intent, the reforms in practice
    were interpreted by federal site officials to mean they
    couldn't intervene when security problems arose.
        We will discuss today the findings of a revealing Task
    Force assessment, which was commissioned in response to Y-12
    and released to the administrator in November. Led by Air Force
    Brigadier General Sandra Finan, who will testify on the first
    panel this morning, the Task Force found that issues at Y-12
    were part of a larger pattern of deficiencies in NNSA's
    security-related functions and activities across board.
    Notably, the Task Force found no clear lines of accountability
    at NNSA, and broken security policy process, an ``eyes on,
    hands off'' governance approach that weakened federal
    oversight, and a federal organization ``incapable of performing
    effective security performance assessment'' of the contractors
    operating the sites.
        We will hear testimony from GAO on our second panel that
    many of these deficiencies are identical to those identified at
    NNSA 10 years ago. It appears the Department instituted reforms
    that actually may have exacerbated the deficiencies, turning
    ``eyes on, hands off'' into eyes closed, hands off.
        Deputy Secretary Poneman and acting NNSA Administrator
    Miller I trust will explain to us today how and when the agency
    will implement the Task Force's recommendations and exactly how
    they will communicate clear and appropriate priorities for
    safety and security in their governance of the sites. Let me
    welcome you both, and General Finan.
        Our second panel provides broader perspective on security
    culture at the Department. Along with GAO, we will hear from
    General Donald Alston and former NRC Chairman Richard Meserve,
    two of three contributors to an analysis requested by the
    Secretary of Energy about the physical security structure at
    the DOE.
        The experience and perspective of these witnesses should
    help us to put the security deficiencies in the broader context
    of the oversight and management challenges confronting DOE. In
    the end we should identify a path forward for the Department to
    ensure strong oversight and zero tolerance for failures. The
    risks to millions of people, and indeed geopolitics are too
    important for anything less.
        [The prepared statement of Mr. Murphy follows:]

                     Prepared statement of Hon. Tim Murphy

        Good Morning. We convene this hearing to continue the
    Committee's examination of the Department of Energy's
    management and oversight of its nuclear weapons complex--three
    national weapons laboratories and five production and testing
    facilities. These eight sites are responsible for the
    stewardship of our nation's nuclear weapons stockpile.
        DOE, through its National Nuclear Security Administration
    (or NNSA), spends billions of dollars each year performing
    hazardous operations to maintain and secure nuclear weapons and
    weapons materials. This work is performed by contractors at the
    Department's nuclear weapons sites under the supervision of
    federal officials and requires strict adherence to strong
    safety standards. The supremely sensitive nature of the
    materials and technologies also requires the Department to
    ensure an extraordinary level of security to safeguard these
    nuclear sites and operations.
        Our attention today will focus mainly on the lessons for
    the Department from the security and oversight failures that
    occurred last summer at the Y-12 National Security Complex, in
    Oak Ridge Tennessee--and what DOE is doing to address these
    lessons.
        At its hearing this past September, this Subcommittee began
    to examine preliminary information about the failures at Y-12.
    We learned how these failures allowed three protestors at
    around 4:20 a.m. one morning last July to penetrate security
    fences and detection systems and deface the walls of the
    facility storing highly enriched uranium.
        We learned about inexcusable maintenance problems and
    ``compensatory'' security measures to work around broken
    equipment and chronic false alarms. We learned about the
    inadequate response by the protective guard force.
        And most to the point of our hearing today, we learned
    about the failure of contractor governance and Federal
    oversight to identify and correct the multiple early indicators
    of Y-12's security, maintenance, and communications systems
    breakdowns.
        The DOE Inspector General's testimony at that hearing
    revealed that federal site officials did not do anything to
    address security maintenance backlogs because NNSA's contractor
    governance system meant ``they could no longer intervene.''
    This perhaps is the most incomprehensible aspect of this
    troubling situation. It appears that, due to a ``hands off''
    federal contracting policy, we had ineffective federal security
    oversight at Y-12--and potentially at other sites around the
    complex.
        Information produced since September confirms that a strong
    oversight approach to security has not been paramount at DOE,
    particularly since the Department instituted certain reforms to
    its oversight in 2009 and 2010. The stated purpose of these
    reforms was to give contractors flexibility to tailor and
    implement safety and security programs ``without excessive
    federal oversight or overly prescriptive departmental
    requirements.'' Whatever the intent, the reforms in practice
    were interpreted by federal site officials to mean they
    couldn't intervene when security problems arose.
        We will discuss today the findings of a revealing Task
    Force assessment, which was commissioned in response to Y-12
    and released to the Administrator in November. Led by Air Force
    Brigadier General Sandra Finan, who will testify on the first
    panel this morning, the Task Force found that issues at Y-12
    were part of a larger pattern of deficiencies in NNSA's
    security-related functions and activities across board.
        Notably, the Task Force found no clear lines of
    accountability at NNSA, a broken security policy process, an
    ``eyes on, hands off'' governance approach that weakened
    Federal oversight, and a federal organization ``incapable of
    performing effective security performance assessment'' of the
    contractors operating the sites.
        We will hear testimony from GAO on our second panel that
    many of these deficiencies are identical to those identified at
    NNSA ten years ago. It appears the Department instituted
    reforms that actually may have exacerbated the deficiencies--
    turning ``eyes on, hands off'' into eyes closed, hands off.
        Deputy Secretary Poneman and acting NNSA Administrator
    Miller I trust will explain to us today how and when the agency
    will implement the Task Force's recommendations and exactly how
    they will communicate clear and appropriate priorities for
    safety and security in their governance of the sites. Let me
    welcome you both, and General Finan.
        Our second panel provides broader perspective on security
    culture at the Department. Along with GAO, we will hear from
    General Donald Alston and former NRC Chairman Richard Meserve,
    two of three contributors to an analysis requested by the
    Secretary of Energy about the physical security structure at
    the DOE.
        The experience and perspective of these witnesses should
    help us to put the security deficiencies in the broader context
    of the oversight and management challenges confronting DOE. In
    the end we should identify a path forward for the Department to
    ensure strong oversight and zero tolerance for failures. The
    risks to millions of people, and indeed geopolitics are too
    important for anything less.

                                    #  #  #

        Mr. Murphy. I would now like to recognize Ranking Member
    Diana DeGette for her opening statement.

     OPENING STATEMENT OF HON. DIANA DEGETTE, A REPRESENTATIVE IN
                  CONGRESS FROM THE STATE OF COLORADO

        Ms. DeGette. Thank you, Mr. Chairman.
        Mr. Chairman, as you said, a little over 7 months ago, an
    82-year-old nun and two middle age men breached the security
    perimeter surrounding the highly-enriched uranium facility at
    the Y-12 National Security Complex in Oak Ridge, Tennessee. In
    the wake of that incident, this committee had a hearing toward
    exactly how such an absurd and dangerous breach of security
    could happen. Today, I want to thank you for having this
    follow-up hearing to learn what has happened to address the
    security breakdowns that resulted in the breach, and to make
    sure that something like that never happens again.
        I want to thank you, Mr. Chairman, for continuing our
    longstanding bipartisan interest in this subcommittee in
    ensuring that our nuclear facilities are safe and secure.
        Our past oversight over the nuclear complex has made a
    significant difference, raising standards for worker safety,
    ensuring lab safety, ensuring security standards remain
    accountable to those who work within the labs and who live
    nearby, and forcing NNSA to make significant changes when
    things go awry. But I got to tell you, as I have told you
    before, both on and off the record, every few years we go
    through this same thing. There is an incident, there is an
    aggressive response from NNSA, time passes without an incident,
    and everybody begins to relax. Labs start to complain about
    overly burdensome paperwork and oversight. In response,
    expectations and rules are relaxed, and then, of course,
    without fail, another incident occurs. I am tired of this
    pattern and we should all be tired of this pattern, because it
    really does affect our national security.
        Today, I am hoping to hear how NNSA and DOE have responded
    to last year's call to action, not just at Y-12, but across the
    NNSA complex. But more importantly, I want to hear what they
    are doing to ensure that we don't have to have any more
    hearings about security breaches or safety incidents at these
    sites. I guess my view is, it is time to break this pattern.
        I want to commend the agencies for acting promptly to
    address the issues exposed at Y-12 in the wake of the July 28
    breach. However, I continue to be deeply concerned about
    oversight within NNSA. Last month, GAO again released its high
    risk list, identifying agencies and program areas that are at
    high risk due their vulnerabilities to fraud, waste, abuse, and
    mismanagement. Just as it has been since 1990, contract
    management at NNSA is on this list. Assessments conducted after
    last year's security breach show that NNSA dubious honor is
    well-deserved. A February, 2013, DOE Inspector General report
    described a ``eyes on, hands off'' approach to contractor
    oversight, meaning federal employees felt they could monitor
    but not intervene in contractor activities, even if they
    suspected an issue. Recent assessments conducted by DOE's
    Office of Health, Safety, and Security showed contractor
    communication problems, both between different contractors at
    the Y-12 site, and between the contractor and federal employees
    at Y-12, and other independent experts observed a Y-12 culture
    that completely failed to adequately focus on security.
        As terror effects become more real, and as our enemies
    become more sophisticated, we just can't afford to take this
    ``eyes on, hands off'' approach to security. Tens of thousands
    of people work at these labs and facilities, and we owe it to
    them and to the communities around the facilities and the
    American people to ensure that they are safe and secure. To do
    that, we have got to closely examine and monitor the nuclear
    complex, promote transparency when it comes to how DOE and NNSA
    are using their resources, and demand accountability from
    everybody involved. We have to insist that standards are simply
    never relaxed because people don't like filling out paperwork.
    In short, we have to demand more.
        There has been no shortage of assessments of what should be
    done for the complex, and in the coming months, I am sure we
    can expect more of these. As we move forward, we have to
    continue to make sure that DOE and NNSA are keeping nuclear
    safe sites safe and adapting and responding to the ever-
    changing security challenges at the nuclear complex.
        So Mr. Chairman, I am happy that you are continuing the
    grant tradition of this subcommittee in oversight of DOE and
    NNSA, and I look forward to working with you as we move along
    in the future. I yield back.
        Mr. Murphy. I thank the Congresswoman from Colorado.
        I now recognize the chairman of the full committee, Mr.
    Upton, for an opening statement.

       OPENING STATEMENT OF HON. FRED UPTON, A REPRESENTATIVE IN
                  CONGRESS FROM THE STATE OF MICHIGAN

        Mr. Upton. Well thank you, Mr. Chairman.
        Today's hearing represents another important step in this
    committee's ongoing oversight to ensure that the Department of
    Energy's management of nuclear security enterprise can
    successfully protect taxpayer dollars, ensure public health and
    worker safety, and in fact, safeguard our national security
    assets. We know from our past work, as well as from the recent
    and very troubling security failures at Y-12, that management
    reform is necessary to ensure safe and secure operations. The
    challenge has been learning the right lesson from past
    failures, and then successfully implementing the right fixes.
        Time and again over the last 14 years, we have witnessed
    dramatic failures in safety and security, as well as taxpayer
    waste across the nuclear complex. Despite that poor track
    record, in '09 DOE proposed increased economy and less
    oversight as the appropriate corrective actions. We know,
    though, from past experiences and the Y-12 breach that strong
    and consistent federal management bolstered by truly
    independent oversight is, in fact, necessary. DOE leadership
    must be clear that safety and security come first. They go hand
    in hand. This is the lesson that we have learned from the
    civilian nuclear industry. As safety improves, so does
    performance. Absent an imbedded safety culture, there is
    erosion of safety practices, leading to outages, delays, and
    other operational impacts. The same is true for security.
        The Y-12 security breach demonstrated not only a failure at
    the site, but also a failure of DOE and NNSA management. We can
    trace some of that failure to the initiative launched by DOE
    leadership 3 to 4 years ago to rely more on contractor's self-
    assessments and define success as productivity gained.
    Secretary Chu himself wanted DOE to be viewed as a ``partner
    and asset,'' his words for the contractors, sending the signal
    that oversight of these contractors would not be a priority.
    Members on this committee warned the Secretary in 2010 that
    such initiatives, however well-intentioned, were
    misinterpreting the lessons and the past and could, in fact,
    backfire, and that track record speaks for itself.
        As this committee, with oversight responsibility for DOE,
    we must ensure that current and future DOE leadership learns
    the right lessons. That starts today when we hear about the
    plans to fix and sustain improvements in safety and security
    oversight.
        I yield the balance of my time to Dr. Burgess.
        [The prepared statement of Mr. Upton follows:]

                 Prepared statement of Hon. Chairman Fred Upton

        Today's hearing represents another important step in this
    committee's ongoing oversight to ensure the Department of
    Energy's management of the nuclear security enterprise can
    successfully protect taxpayer dollars, ensure public health and
    worker safety, and safeguard our national security assets.
        We know from both our past work, as well as from the recent
    and very troubling security failures at Y-12, that management
    reform is necessary to ensure safe and secure operations. The
    challenge has been learning the right lessons from past
    failures and then successfully implementing the right fixes.
        Time and again over the past 14 years, we have witnessed
    dramatic failures in safety, security, and taxpayer waste
    across the nuclear complex. Despite this poor track record, in
    2009 DOE proposed increased autonomy and less oversight as the
    appropriate corrective actions.
        We know, though, from past experience and the Y-12 breach
    that strong and consistent federal management, bolstered by
    truly independent oversight, is necessary. DOE leadership must
    be clear that safety and security come first.
        Safety and performance go hand-in-hand. This is the lesson
    we've learned from the civilian nuclear industry. As safety
    improves, so does performance. Absent an embedded safety
    culture, there is erosion of safety practices, leading to
    outages, delays, and other operational impacts. The same is
    true for security.
        The Y-12 security breach demonstrated not only a failure at
    the site, but also a failure of DOE and NNSA management. We can
    trace some of this failure to the initiatives launched by DOE
    leadership three and four years ago to rely more on contractor
    self-assessments, to reduce ``burdensome'' oversight, and to
    define success as productivity gains. Secretary Chu himself
    wanted DOE to be viewed as a ``partner and asset'' for the
    contractors, sending a signal that oversight of these
    contractors would not be a priority.
        Members on this committee warned the Secretary in 2010 that
    such initiatives--however well-intentioned--were
    misinterpreting the lessons of the past and could backfire.
    DOE's track record speaks for itself.
        As the committee with oversight responsibility for DOE, we
    must ensure that current and future DOE leadership learn the
    right lessons. This will start today, when DOE/NNSA explains
    that it has serious plans for fixing and sustaining improvemes
    in safety and security oversight.

                                    #  #  #

    OPENING STATEMENT OF HON. MICHAEL C. BURGESS, A REPRESENTATIVE
                  IN CONGRESS FROM THE STATE OF TEXAS

        Mr. Burgess. I thank the chairman of the full committee--
    chairman of the subcommittee for calling this important
    hearing. This is an important follow-up on the committee's work
    in the last Congress into the astonishing security lapses that
    occurred at one of our most important, and purportedly most
    secure nuclear weapons facilities in the country.
        You know, you look at the continuum, the range of failure
    and it goes from totally unacceptable to an abject failure, and
    this is at one of our country's most important facilities that
    stores highly enriched uranium for our defenses and for our
    national security. At last September's hearing, I voiced my
    concern over the lack of accountability. We need to know who at
    Department of Energy was held accountable. Who lost their job?
    Who lost their job because of this epic failure of security and
    oversight?
        Now, General Finan's task force, I think, has put it very
    succinctly that there is a pervasive culture of tolerating the
    intolerable and accepting the unacceptable. I fear that
    statement has really become the operational motto of the
    Executive Branch, where failure after failure is met with a
    shrug and not much more. Had this incident been perpetrated by
    someone with more sinister motives, the break-in could have had
    catastrophic results for that region and for our Nation. So I
    continue to be concerned that our security at our Nation's most
    critical facilities is not being given the priority that it
    deserves.
        Chairman Murphy and I met with General Finan, and I thank
    you, General, for taking the time for that meeting--this was a
    month ago--to discuss some of the observations that her task
    force has made in the security lapses and the oversight
    failures at NNSA. So certainly, we look forward to hearing from
    you this morning as to where the NNSA stands in its oversight
    of these facilities.
        This investigation is a prime example of the good work that
    this committee can do when it works in a bipartisan manner. The
    security of our Nation's weapons facilities is not an issue
    that divides or should divide along party lines. We are all in
    favor of safe, secure areas where our nuclear stockpiles can be
    held, ready to protect our Nation, and safe from predators.
        With that, Mr. Chairman, I will yield back.
        Mr. Murphy. Thank the gentleman. I will now recognize for 5
    minutes the ranking member of the full committee, Mr. Waxman.

    OPENING STATEMENT OF HON. HENRY A. WAXMAN, A REPRESENTATIVE IN
                 CONGRESS FROM THE STATE OF CALIFORNIA

        Mr. Waxman. Thank you, Mr. Chairman, for recognizing me and
    for holding this hearing.
        The Y-12 incident was embarrassing for DOE and NNSA, the
    National Nuclear Security Administration. It exposed serious
    issues within the security organization at NNSA. I appreciate
    our witnesses being here today, and I hope they will help us
    identify and address these concerns.
        The security concerns we will hear about today must be
    addressed. We cannot let our nuclear facilities become targets
    for our foreign enemies and terrorists. We need to invest in
    the safety and security of these facilities, both financially
    and by ensuring they have a culture that is focused on keeping
    our nuclear legacy materials and the people who work with them
    safe and secure.
        I appreciate DOE's actions in the wake of the Y-12
    incident. The Department has taken this incident seriously and
    developed a thoughtful approach to addressing concerns that
    have been identified, but there is still more work left to be
    done. DOE needs to ensure that it exercises strong oversight
    over both its contractors and its federal employees at NNSA
    sites, and as noted by General Finan today, DOE needs to ensure
    that there is a clear line of authority from the Secretary down
    to the contractor, security guards at every site.
        Over the years, many people have advocated many different
    structures for NNSA, but the assessments made after the Y-12
    incident show that the problem is not too much DOE efforts
    oversight, it is too little. The problem is that contractors
    didn't take their responsibilities to the government or their
    workers seriously. The federal employees failed to exercise
    appropriate authority over the contractor counterparts, and
    that NNSA's culture didn't adequately focus on security.
        These problems can be resolved by effective oversight by
    DOE by requiring that contractors become accountable and
    transparent, and by ensuring that the federal officials who
    oversee these contractors take a hands on approach to
    oversight.
        In the past year, some have suggested that NNSA needs more
    autonomy. In fact, last year's House-passed National Defense
    Authorization Act included language stripping DOE's authority
    over some NNSA sites. Given what we have seen in the last 7
    months, that approach makes absolutely no sense. The Y-12
    breach made it abundantly clear that NNSA is not doing enough
    on its own. All the findings and recommendations that have come
    from independent evaluators of the Y-12 breach, including
    NNSA's own task force, show that NNSA needs more oversight, not
    less. NNSA sites house some of our most dangerous nuclear
    assets. We need vigorous oversight by DOE to ensure that these
    nuclear materials are appropriately protected.
        Mr. Chairman, again, thank you for holding this hearing. I
    look forward to more opportunities to check in on NNSA's
    progress. I yield back the balance of my time.
        Mr. Murphy. The vice chairman yields back, and now we will
    go over our witnesses today.
        With us today is Brigadier General, United States Air
    Force, Sandra Finan. I hope I am pronouncing that right. I
    believe I am, right? Thank you for being here. She is the
    Commander of the Air Force Nuclear Weapons Center and former
    Acting Chief of Defense Nuclear Security, National Nuclear
    Security Administration.
        Also joining her is Daniel B. Poneman, Deputy Secretary,
    U.S. Department of Energy. Thank you so much for being with us
    today, sir, and also accompanied by Neile Miller, the Acting
    Administrator of NNSA. I hope I have all the title correct.
        As you know, the testimony you are about to give is subject
    to Title XVIII, Section 1001 of the United States Code. When
    holding an investigative hearing, this committee has a practice
    of taking testimony under oath. Do you have any objections to
    testifying under oath?
        The chair then advises you that under the rules of the
    House and rules of the committee, you are entitled to be
    advised by counsel, if you desire to be advised by counsel
    during your testimony today. OK, they all say no.
        Then in that case, if you would please rise and raise your
    right hand, and I will swear you in.
        [Witnesses sworn.]
        Mr. Murphy. Thank you. Noting for the record that all the
    witnesses responded in the affirmative, I now call upon each of
    them to give a 5-minute summary and their written statement.
        Starting off with you, General Finan, thank you for being
    here today.

        TESTIMONY OF SANDRA E. FINAN, BRIGADIER GENERAL, USAF,
     COMMANDER, AIR FORCE NUCLEAR WEAPONS CENTER AND FORMER ACTING
    CHAIRMAN OF DEFENSE NUCLEAR SECURITY, NATIONAL NUCLEAR SECURITY
    ADMINISTRATION (NNSA); AND DANIEL B. PONEMAN, DEPUTY SECRETARY,
      U.S. DEPARTMENT OF ENERGY, ACCOMPANIED BY NEILE L. MILLER,
         ACTING UNDERSECRETARY FOR NUCLEAR SECURITY AND ACTING
                          ADMINISTRATOR, NNSA

                      TESTIMONY OF SANDRA E. FINAN

        General Finan. Chairman Murphy, Ranking Member DeGette,
    distinguished members of the committee, thank you for the
    opportunity to discuss the study I conducted on the National
    Nuclear Security Administration's federal security
    organization----
        Mr. Murphy. Could you pull your mike closer to yourself
    there, if it is on, too?
        General Finan. Is that better?
        Mr. Murphy. Yes, much better. Thank you.
        General Finan. OK.
        Thank you for the opportunity to discuss the study I
    conducted on the National Nuclear Security Administration's
    federal security organization and assessment model. Although I
    am no longer assigned to the NNSA, I am pleased to share our
    observations based on our 90-day study.
        In the aftermath of the July 28, 2012, security incident at
    the National Nuclear Security Administration's Y-12 National
    Security Complex, the leadership of the NNSA and the Department
    of Energy took action to address the security failures at Y-12.
    The initial information gathered revealed that the issues at Y-
    12 were part of a larger pattern of security program management
    deficiencies within NNSA. These security issues prompted the
    NNSA administrator to commission a task force to analyze the
    current federal NNSA security organizational structure and
    security oversight model and recommend possible improvements.
    The NNSA Administrator directed the Task Force to analyze the
    current NNSA security organizational structure and recommend
    possible improvements, and to analyze the current NNSA security
    oversight model and mechanisms to determine what seams existed
    and what structures could be implemented to better ensure that
    the issues are found and fixed before they become problems.
        While other reviews were aimed at diagnosing the root
    causes of the Y-12 event, the NNSA administrator's direction
    called for this Task Force to focus on the a path forward
    within the federal NNSA organization. Under my leadership, the
    task force consisting of NNSA, DOE, and military specialists
    conducted extensive document reviews and interviewed federal
    managers and staff as well as a selection of contractor
    security managers and others across the NNSA security
    organization. The task force collected and analyzed
    information, identified issues, and suggested a revised
    organizational structure and assessment model.
        While we highlighted negative aspects of the NNSA security
    organization and assessment model, the task force found many
    great people on the NNSA security staffs. They are clearly
    dedicated, skilled, and hard-working and want to get the
    security mission done right. Unfortunately, NNSA security
    personnel have seen themselves thwarted by lack of management
    support and feel obstructed by some of their peers. Their
    difficulties were compounded by the absence of a workforce
    strategy to recruit, retain, and develop a cadre of talented,
    knowledgeable and experienced security professionals. Thus, it
    is all the more encouraging that these personnel, almost
    without exception, genuinely care about doing good work. Their
    continued strong desire to build a successful security
    organization is a hopeful sign for the future.
        Mr. Chairman, with your permission, I will submit the
    remainder of my testimony for the record. It contains the
    findings of the task force.
        [The prepared statement of General Finan follows:]

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        Mr. Murphy. Thank you. I appreciate that.
        Mr. Poneman?

                     TESTIMONY OF DANIEL B. PONEMAN

        Mr. Poneman. Chairman Murphy, Ranking Member DeGette, and
    members of the subcommittee, thank you for the invitation to
    appear before you today to provide the subcommittee details on
    the actions the Department has taken or will take to strengthen
    the security of the Nuclear Weapons Complex in the wake of the
    July, 2012, Y-12 incident. We appreciate the interest and
    engagement of this committee and recognize the important
    oversight role that you fulfill. The Secretary and I recognize
    the severity of the problem that led us to this point, and we
    have acted swiftly to identify and address the issues it
    revealed.
        Since the Y-12 incursion, several major actions have taken
    place to improve security immediately and for the long term.
    Let me tell you about a few of them.
        We restructured the contracts at Y-12 to integrate security
    into the line of command at the M&O contractor. The protective
    force contractor was terminated, and a new M&O contractor has
    been selected to manage the Y-12 site, providing an opportunity
    for new leadership and to improve the Y-12 security culture. We
    held accountable both the senior federal and contractor
    management personnel at headquarters and the site, removing
    them from their positions. The Department's Chief of Health,
    Safety, and Security conducted an independent security
    inspection of Y-12 security operations, which include rigorous
    force-on-force performance testing, as well as no notice and
    short notice limited scope performance testing activities as
    directed by the Secretary. HSS will be conducting a follow-up
    review in April to examine the status of the implementation of
    corrective actions. The Secretary also directed HSS to conduct
    immediate extent of condition assessments of all sites in
    Category I nuclear materials across the DOE complex, to
    identify any immediate security issues and to follow up with a
    full security inspection, including force-on-force exercises to
    assure effective security measures are being implemented at
    those sites.
        NNSA conducted an immediate after-action report to identify
    causes, issues to be addressed and recommended action, and you
    just heard very eloquently summarized the findings of those
    reports.
        In order to address these institutional problems that have
    been revealed, we are continuing to embrace and implement the
    findings of General Finan's report, which you just heard her
    describe.
        Because we believe that we need fresh perspectives from
    disinterested parties to consider broader and long-term
    responses to this incident, Secretary Chu requested three
    independent experts in this area to conduct a strategic review
    of the entire DOE security architecture, with a particular
    emphasis on Y-12, and I see that you are joined by two of the
    three of these eminent experts here today. Each of them
    provided thoughtful advice on the DOE's nuclear security
    structure, specifically, all Category I nuclear facilities. We
    are now reviewing and discussing their advice on how to improve
    security at Y-12, and across the nuclear enterprise.
        The series of personnel and management changes I have
    described today were made to provide effective security at the
    Y-12 site, and across the DOE complex. We are also working to
    carry out the structural and cultural changes required to
    secure all Category I nuclear materials at this and all other
    DOE and NNSA facilities, and in this respect, I welcome the
    comments of--in your opening remarks from members of this
    subcommittee about the need to introduce cultural changes so
    that we are not back in the same situation again. That is
    absolutely critical, and I think as we get into the discussion,
    what you hear in terms of what we are implementing from General
    Finan's report will put us in the right direction in that
    respect.
        Our management principles hold that our mission is vital
    and urgent. Nowhere is that more true than here. The security
    of our Nation's nuclear material and technology is a core
    responsibility of the Department, in support of the President
    and in defense of the Nation. The incident at Y-12 was
    unacceptable and served as an important wakeup call for our
    entire complex. The Department is taking aggressive actions to
    ensure the reliability of our nuclear security programs across
    the entire DOE enterprise and will continue to do so.
        In that effort, the Department looks forward to working
    with this subcommittee to ensure the security of the Nation's
    nuclear materials. I would be pleased, of course, to answer any
    questions from members of this subcommittee, and request the
    balance of my statement be submitted for the record.
        Thank you, Mr. Chairman.
        [The prepared statement of Mr. Poneman follows:]

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        Mr. Murphy. And so will the balance of your statement will
    be submitted for the record.
        We understand, Ms. Miller, you do not have an opening
    statement, so we will go right into some questions. I will
    recognize myself for 5 minutes.
        First of all, let me just say that I appreciate your
    candor. Nothing is better for leaders than to step forward and
    say mistakes have been made, taking full responsibility, and
    taking definitive action. I thank you for that. We are
    certainly hoping this never happens again, and we hope that the
    report and recommendations are going to be fully implemented
    and continue to be reviewed.
        So let me start with you, General Finan. Your task force
    identified the serious weaknesses in the federal capability to
    evaluate contractor performance at the Nuclear Weapons Complex.
    The NNSA administrator commissioned your report. I am correct
    in that?
        General Finan. Yes, sir.
        Mr. Murphy. It is also correct that the recommendations are
    directed at the administrator, not the Secretary of Energy, am
    I correct?
        General Finan. That is correct. It was all NNSA-focused.
        Mr. Murphy. Thank you. I just want to make sure we are
    following the right chain here.
        Mr. Poneman, as Deputy Secretary of Energy, you and the
    Secretary set high level policy direction and safety and
    security standards for NNSA's mission, but it is the
    responsibility of the NNSA to arrange a structure to accomplish
    these goals. That is up to the administrator, am I correct?
        Mr. Poneman. It is up to the administrator, of course,
    subject to, as you just said, the leadership of the Secretary
    and the Deputy Secretary.
        Mr. Murphy. And something you will continue to monitor as
    well?
        Mr. Poneman. Absolutely.
        Mr. Murphy. Thank you.
        Ms. Miller, you are now the NNSA Acting Administrator.
        Ms. Miller. That is right.
        Mr. Murphy. Is it correct that you were Principal Deputy
    Administrator at NNSA as it implemented its safety and security
    reform efforts in 2010?
        Ms. Miller. I became the Principal Deputy Administrator in
    August of 2010.
        Mr. Murphy. OK. Do you agree with the findings of General
    Finan's report?
        Ms. Miller. I completely agree with them.
        Mr. Murphy. Thank you.
        General Finan states that NNSA must clearly and
    consistently emphasize the importance of security. Do you agree
    with her statement?
        Ms. Miller. I absolutely agree with them.
        Mr. Murphy. Thank you.
        Do you believe that NNSA's leadership has been inconsistent
    in the message it sends to the field about security emphasis?
        Ms. Miller. I believe it has been inconsistently
    communicated, yes. Absolutely.
        Mr. Murphy. Were you aware of the inconsistent messages on
    security prior to Y-12?
        Ms. Miller. I would say that I was aware that because the
    chief of Defense Nuclear Security, as well as the chief of
    Defense Nuclear Safety reported directly to the administrator
    and not to me. I would say I was aware of the difficulty and
    the inconsistencies in communicating policy and decisions for
    security and many other areas from the headquarters
    organization to the field offices.
        Mr. Murphy. Well yes, and since part of the purpose of this
    Committee on Oversight is to make sure that we are
    understanding lessons learned, but what you don't measure, you
    can't manage. What you don't admit, you can't act on. Were
    there some lessons you learned from this, some things that you
    should do differently in terms of the process as we move
    forward?
        Ms. Miller. Mr. Chairman, I would say two things. First of
    all, there were lessons I had been learning prior to this
    incident that caused us to announce a few weeks before this
    incident, the end of July, that we were changing the way we
    governed our sites. And that is to say, we took the sites from
    within defense programs, our large weapons program, where they
    had been reporting for a number of years and had them now
    directly report to the administrator through an associate
    administrator peer level, the senior management, so that we
    could start to drive accountability and consistency across our
    sites. So that was a measure that I had come to the conclusion
    that organization absolutely had to make to address what I said
    before, which was concern about inconsistencies all over the
    place.
        With regard to post-Y-12 incident, in particular with
    security, I was fortunate to be able to draw upon General
    Finan's recommendations and work with her, as she was part of
    the organization at the time, and others to change the way we
    operate security, both at headquarters and in the field.
        Mr. Murphy. Thank you.
        Last month on February 5 at NNSA, associate administrator
    for management and budget disputed the Inspector General's
    report that Y-12 oversight was ineffective because of the
    ``eyes on, hands off'' oversight approach. The officials said
    that the ``eyes on, hands off'' policy never applied to
    security matters and that this was a misperception by some
    federal officials. Ms. Miller, why is an NNSA senior official
    continuing to dispute the impact of the ``eyes on, hands off''
    policy?
        Ms. Miller. I think the issue is not to dispute the impact.
    I think the point is that we certainly did not set out--and
    again, this predates me, but no one set out to say that
    oversight should not be conducted, that your proper role is not
    to be overseeing all aspects of the contractor's performance.
    What I would say is that, as you yourself mentioned, driving
    that message through a very large organization from the
    administrator through every individual in every layer at every
    site is the big challenge. It is the challenge in security, it
    is the challenge all over the place. It is not a new issue. As
    the ranking member mentioned, we need to break the pattern, and
    that is definitely what the organization is about right now.
        Mr. Murphy. Thank you. Hopefully you will communicate that
    through solidly, because of the extreme concerns about what
    happened.
        I recognize each member for 5 minutes as we go through.
    Next is Ms. DeGette.
        Ms. DeGette. Thank you, Mr. Chairman.
        Secretary Poneman, I was intrigued when--first of all, let
    me say, I am impressed and encouraged by the commitment the
    agency has made to not having to come back here next year or
    the year after with some new crisis. I am, both in these
    hearings and some of our off--our side conversations, I do
    believe you have that commitment.
        Secretary Poneman, I wanted to ask you, because you just
    said in your testimony that you are committed to implementing
    some of the aspects of the General's report to make sure that
    we are not back here in a year or two. I wonder if you could
    briefly tell us--if you could give us the highlights of what
    those things are?
        Mr. Poneman. Gladly, Congresswoman DeGette.
        The critical, I think, finding that General Finan's report
    showed was that we had a lack of clarity of line of management
    control and accountability. So what we have done is, under her
    recommendation implemented by Acting Administrator Miller and
    fortunately, before General Finan left us, she was the acting
    head of defense nuclear security, to get this started. We have
    now made sure that under this organization that Ms. Miller just
    introduced of the operations and infrastructure that the
    responsibility to direct security at the site flows down from
    the administrator through that office to the site. The other
    office that had been doing security policy, so-called NA-70,
    had been actually exercising some apparent line management
    authority, which was creating confusion. That function has been
    stripped away. Any line authority has been stripped away from
    NA-70.
        Ms. DeGette. So you think that is the key, having a clear
    chain of--that is the number one? What else?
        Mr. Poneman. Number two is the staff function that that new
    organization--that NA-70 must perform, they need to promulgate
    the policies and perform independent evaluations so it is not
    just the site checking itself.
        Ms. DeGette. OK, independent evaluations. Those are the two
    key things.
        Mr. Poneman. Yes, oversight and a line management.
        Ms. DeGette. Now, another issue--I don't have--we might do
    another round, but--so I want to just go into this other issue
    that I care a lot about, which complaints that the committee
    has heard about overly burdensome oversight stifling the work
    being done at NNSA labs and sites. And what we think--I was
    talking to the chairman about this--is that federal officials
    need to conduct strict oversight of the contractors, or serious
    security problems can fall through the cracks.
        So what I wanted to ask you, General Finan, in your review,
    did you find that the problems you saw within NNSA were caused
    by overly burdensome congressional oversight?
        General Finan. The issues that I found were not caused at
    all by oversight. It was actually caused by lack of oversight,
    and I mean oversight at every level.
        Ms. DeGette. Right, right. So what was the----
        General Finan. It was impacting everything.
        Ms. DeGette. We need to have clear oversight from the top
    down, and as Mr. Poneman says, independent oversight, right?
        General Finan. The burden was actually--when you--we
    created a system that required a whole bunch of paperwork, and
    the paperwork is burdensome, but what we lost in security was
    the ability to see security performance. It was paperwork.
        Ms. DeGette. Yes, there was a bunch of paperwork, but it
    was irrelevant to the core task, right?
        General Finan. Correct.
        Ms. DeGette. Mr. Poneman, do you want to comment on that?
        Mr. Poneman. I thought it was a very apt finding, and the
    misinterpretation of that 2010 reform is exactly on this point.
    We were trying to strip away the excessive paperwork and get to
    the performance testing.
        Ms. DeGette. Right, but did any of the auditor's
    assessments conducted in the wake of the Y-12 incident find
    that it was caused by too much congressional oversight of the
    Y-12 contractors?
        Mr. Poneman. No, ma'am.
        Ms. DeGette. OK. The reason I bring this up is because some
    people try to say oh, we have too much oversight. It seems to
    me when we have these problems over and over again, the problem
    is not too much oversight. The problem is too little effective
    oversight and accountability. Ms. Miller, you are nodding your
    head. Would you agree with that?
        Ms. Miller. Yes, I would definitely agree. It is about
    effectiveness.
        Ms. DeGette. Now, let's see.
        General Finan, can you tell us about the findings of the
    task force with respect to improved oversight of NNSA security
    contractors? You touched on it just very briefly.
        General Finan. Right. The recommendation we are making is
    that we create an NNSA oversight function, because right now,
    in the system as I looked at it a couple of months ago, NNSA
    did not have any oversight capability. They depended on onsite
    federal personnel to analyze contractor performance. But again,
    they were applying the ``eyes on, hands off'' concept and so
    that was varied from site to site. And what happened is that
    you lacked--there was no sense of criticism in this assessment,
    right?
        Ms. DeGette. Right.
        General Finan. You had onsite people who were your really
    only federal ability to look at contractor performance. Well,
    those folks onsite grew up there, they lived there, you know,
    they spent their whole time. They identified with the mission
    and they were really not a very good source of independent
    oversight as to contractor performance.
        Ms. DeGette. Thank you.
        Mr. Poneman and Ms. Miller, do you agree with that?
        Mr. Poneman. Absolutely----
        Ms. Miller. Yes.
        Mr. Poneman [continuing]. And the reforms we described I
    think reflect that finding.
        Ms. DeGette. Thank you.
        Ms. Miller, do you agree with that?
        Ms. Miller. I do.
        Ms. DeGette. Thank you.
        Mr. Murphy. Thank you. Gentlelady yields back.
        I now recognize the gentleman from Ohio, Mr. Johnson, for 5
    minutes.
        Mr. Johnson. Thank you, Mr. Chairman.
        Mr. Poneman, in her testimony, General Finan states that
    NNSA must clearly and consistently emphasize the importance of
    security. Unfortunately, here is the consistent message that
    the DOE, NNSA organizations, and contractors were hearing. In
    March of 2010, Secretary Chu stated his vision that he wanted
    DOE to be viewed as a valued partner and asset to contractors.
    He went on to suggest that safety could be ensured with a
    skeleton crew of health and safety experts. Also in March of
    2010, Mr. Poneman, you wrote in the Department's safety and
    security reform plan that success will be measured through
    near-term relief from specific low-value burdensome
    requirements, as well as longer term streamlining of
    requirements that will lead to measurable productivity
    improvements. I note that safety and security did not factor
    into this definition of success. Would you agree that
    statements like these send mixed signals about the Department's
    commitment to safety?
        Mr. Poneman. Congressman, the portion of the document read
    from my document, the genesis of that was to set out a set of
    safety and security objectives, so in fact, that particular
    sentence is out of documents that are precisely intended to
    maximize safety and security. What is unfortunate, what has
    happened is the misinterpretation of that. What we were trying
    to do, sir, is to get rid of the checkbox mentality, just
    looking at paperwork and creating paperwork, get back to
    performance testing, so we could be better, safer, and more
    secure. That is absolutely our objective.
        Mr. Johnson. What are you doing today to ensure consistent
    and clear emphasis on safety importance from the headquarters
    on down?
        Mr. Poneman. Number one, we are, on both safety and
    security, assimilating all of the learnings from reports such
    as General Finan's. Number two, because we have found safety
    culture issues as well as security culture issues, we have
    regular meetings where we assemble the top leadership in the
    Department to check on a continuing basis that this is being
    messaged consistently throughout the complex. One of the major
    challenges, Congressman, that we have found is--as you heard
    with this talk about ``eyes on, hands off''--is the
    misinterpretation, like a kid's game of Telephone, is a
    terrible problem. So it is not enough to promulgate a good
    policy. You have got to continually stay on it, message it, and
    work with your leadership and work with the people in the
    field.
        Mr. Johnson. OK, thank you.
        Ms. Miller, a week or so before the Y-12 incident in July
    of 2012, Mr. Don Cook, NNSA Deputy Administrator for Defense
    Programs, made the following remarks, and I quote, ``With
    regard to the relationship that we have and where we are
    between NNSA and its labs and plants--I didn't say my labs and
    plants, but you can tell I feel that way--getting to the point
    where we have oversight on these, which is eyes on, hands off
    oversight, has been my aspiration for several years and it
    remains so. It was my aspiration when I worked on the lab side
    for many years. General Finan completed that ensuring that the
    right leadership is in the right position is absolutely
    critical to success.'' What are you going to do to make that
    happen, ensure that leadership is sending the right message
    about the importance of safety and security?
        Ms. Miller. Mr. Johnson, sending the right message, in my
    view and after many years of looking at the NNSA mostly from
    outside of it, is a challenge that is not achieved just by
    making sure that people at the top level know what the message
    means. But it is difficult to make sure that every single
    person in the 10,000 people at a given lab or 30,000 throughout
    our complex understand what we are talking about. If we--what
    we are doing at NNSA is working to be able to communicate and
    train and talk to people at every single level to make sure it
    is not going to be misunderstood. We recently changed all of
    our M&O contracts. The performance measures in those contracts
    are all now connected to safety and security so that it is not
    possible to believe that you have performed according to the
    terms of a contract in an area like nuclear weapons if you have
    not also met the performance plans for safety and security. It
    just isn't going to happen.
        So this is a step-by-step throughout the organization. It
    is not just at the top level.
        Mr. Johnson. OK, good.
        One final question, General Finan. First of all, as a 26\1/
    2\ year veteran of the Air Force myself, thank you for your
    service and what you have done here.
        A troubling finding in your report is that potentially
    critical management information is not being reported clearly
    to the appropriate decision makers. Would you elaborate on what
    you mean by this?
        General Finan. Yes, sir. As we interviewed people and took
    a look at what was happening, we found out at the lower levels,
    there were people who knew what issues existed out there and
    knew the significance of those issues. But as they attempted to
    rise those issues up to senior levels, they were being
    suppressed. Management at mid levels would suppress it, and so
    in many cases, critical decision information was not making its
    way to the top of the organization.
        Mr. Johnson. OK, thank you for that, and with that, Mr.
    Chairman, I yield back. Thank you.
        Mr. Murphy. OK, gentleman's time is expired, and I will now
    recognize Mr. Tonko for 5 minutes.
        Mr. Tonko. Thank you, Mr. Chair.
        General Finan, you state in your testimony that the
    findings of this task force were very similar to those numerous
    prior reports by other review teams, so my question is, what
    happened to the recommendations of the prior review teams? Were
    they ever implemented? Was the implementation insufficient, or
    is there a larger problem that still needs to be identified?
        General Finan. There is a cultural issue. Those findings,
    as you look at them, you go back to see what people did, you
    will find that there are some actions that were put in place,
    but there was a check the box mentality that said we want to
    get rid of the findings as fast as we can. So they do whatever
    they could to say yes, I have responded to this finding and it
    is gone. And so the things that they changed didn't stick. It
    was just a matter of taking action, checking the box, closing
    the finding, and going on to the next thing. And so what needs
    to happen is all those things need to be taken in aggregate, we
    need to create a roadmap, and then we need to change the
    culture so that we continuously evaluate those things and go
    back and make sure that we don't, year after year, make the
    same mistake and that we are not interested in checking the box
    off, we are interested in changing the way we do business so we
    do it the right way.
        Mr. Tonko. Thank you. There seems to be a theme that runs
    through a number of the task force's observations that cost
    control was a bigger concern for many of the people managing
    the program, the security program, than performance of the
    security mission. This implies there is a real or perceived
    lack of resources to support the security mission fully. Which
    is it, real or perceived?
        General Finan. It is a combination of both. What happened
    was that management had overwhelmingly started to figure out--
    they wanted to reduce the cost of security, and so in doing
    that, what they did is they lost sight of the requirements of
    security, and because the two were mixed together, the people
    who determined requirements and the budget were the same
    people. What happened was that they were no longer looking at
    the actual requirements for security. They lost sight of what
    was required in order to adequately secure these materials and
    these sites, and moreover, they lost visibility on the
    important aspect of protecting our operational capability and
    our people. And those items actually got no visibility at all
    and were completely ignored. They thought that if they could do
    the big war, if they could fight the terrorists, they could do
    all the lesser includeds, therefore, they never needed to look
    at lesser includeds. Well, lesser included happened to be a
    protest event, and Y-12 proved that lesser includeds do not--
    you cannot do lesser includeds just because you can fight the
    larger issues. So it was a combination of wanting to reduce the
    budget, which is a good thing. We ought to always be efficient,
    but when you lose sight of the requirements, what happened is
    senior leaders at NNSA did not get to make the decision. Do I
    want to fund that requirement or do I want to take the risk?
    The risk was being assumed at lower levels by default rather
    than being made at the senior decision maker level at NNSA.
        Mr. Tonko. Deputy Secretary Poneman--and I thank you for
    that answer--but Deputy Secretary, how much of DOE's budget is
    spent on contractors, your area of the budget?
        Mr. Poneman. The vast majority. I think it is well over 80
    percent, and we can get you a precise number. I think it is on
    the order of 85 percent.
        Mr. Tonko. With that amount, the agency then, is it fair to
    say, is relying on private contractors to implement many key
    security and safety goals?
        Mr. Poneman. Yes, Congressman, going back to the origins of
    the Department, back to shortly after World War II, Atomic
    Energy Commission, this whole model of the so-called management
    and operating contractor, the M&O contractor model puts most of
    the programmatic and security burdens in the hands of
    contractors who were exercising that authority under federal
    oversight.
        Mr. Tonko. So do the contractors then have a conflicting
    bid of incentives here when carrying out their duties?
        Mr. Poneman. There is a risk, Congressman, and in that
    respect, again, one of the many fine findings of General
    Finan's report, I think, shows the way we need to address that
    is the contractor must own and take responsibility for
    security, and in the first instance, must evaluate that under
    their own self-analysis, but that then needs to have a double
    check, first from the headquarters so there is not the onsite
    cozy relationship, so there is some difference and the federal
    oversight is effective, and secondly, from an independent
    organization, the HSS organization, to effectively ensure you
    have a disinterested third party look to make sure that that
    security is being well executed and there are not conflicts of
    interest, and to hold the contractor accountable if they do not
    self-disclose problems in security that they, in fact, find in
    their own forces.
        Mr. Tonko. General Finan, is it possible that contractor
    concerns over cutting costs could have been one of the causes
    of the Y-12 incident at Oak Ridge?
        General Finan. It could have been, and it may have been
    that they had cut back some of their maintenance personnel in
    order to cut costs, and therefore had misprioritized actions,
    so it could be a contributing factor.
        Mr. Tonko. Thank you. With that, I yield back.
        Mr. Murphy. Gentleman's--thank you very much.
        The chair recognizes the chairman emeritus of the committee
    from Texas, Mr. Barton, for 5 minutes.
        Mr. Barton. Thank you, and I appreciate the courtesy of
    letting me ask questions out of order, since I wasn't here at
    the beginning. I appreciate that of my junior members.
        I want to refresh the subcommittee's memory a little bit.
    We have had repeated security incidences at the weapons
    complexes in the national laboratories over the last 20 years.
    We have had tapes lost, we have had materials lost. This latest
    incident, which has been sanitized to call the Y-12 incident,
    three nuns, I think, one fairly elderly, penetrated to the
    deepest security of our weapons complex. A nun, oK, nuns. They
    showed up at one of our hearings and they were in the audience,
    and these were not ninja warrior, flat belly, skulking people.
    These were just ordinary folks who wandered in, so to speak. So
    we have, once again, another task force that is going to try to
    rectify the problems.
        Now, I want to get the players straight. General Finan, you
    are not in the normal chain of command at the Department of
    Energy, is that correct?
        General Finan. I am no longer assigned to the Department of
    Energy. I am back in the Air Force. I was always in the Air
    Force, but----
        Mr. Barton. This report that you have helped to prepare was
    done at the request of DOE, at the request of the then
    administrator, but you were kind of an outside, fresh look
    person, is that correct?
        General Finan. Well, I guess I would call myself an inside
    outsider. By that time, I had been assigned to NNSA for 18
    months, but I was always an Air Force asset. My reporting chain
    runs through the Air Force. I was always an Air Force member,
    but I was assigned to NNSA for 2 years.
        Mr. Barton. OK, now the report that you testified on has
    been presented to the Department of Energy, is that correct?
        General Finan. Yes, sir.
        Mr. Barton. Now I want to go to Deputy Secretary Poneman.
    It used to be the Deputy Secretary is the number two person at
    DOE. Is that still the case?
        Mr. Poneman. Yes, sir.
        Mr. Barton. Are you the chief operational officer at DOE?
        Mr. Poneman. Yes, sir.
        Mr. Barton. OK. So you have read the report----
        Mr. Poneman. Yes, sir.
        Mr. Barton [continuing]. That has been prepared? I have
    read a summary of it. It is fairly damning, but it is pretty
    clear cut in its recommendations. So the bottom line question
    is what are you going to do about it? Are you going to accept
    the recommendations and act on them, or are we going to
    pontificate and fiddle faddle around and not do anything?
        Mr. Poneman. Yes, sir, it is a fine report. It is
    excellent. It is insightful. We embrace it and not only have we
    already accepted and put into practice the recommendations, but
    while we still had the benefit of General Finan's service in
    the Department, we made her Acting Chief of Defense Nuclear
    Security to oversee the beginnings of the implementations.
        Mr. Barton. So she gets to implement the recommendations?
        Mr. Poneman. She had that started, and as she just
    indicated, been reassigned and we are carrying forward from
    that.
        Mr. Barton. One of the recommendations is that you
    eliminate this multiple diverse authority. Is that going to be
    done, centralizing the one line of authority? That is one of
    the primary----
        Mr. Poneman. That, sir, already has been done and the
    further clarification of the role of the other security
    organizations is also underway. We are, as was indicated, also
    taking into account more widely the recommendations from what
    we call the Three Wise Experts about--from whom you will hear
    directly, but the parts that you have heard from General Finan,
    we are already putting into effect.
        Mr. Barton. OK. Now this concept of ``eyes on, hands off''
    oversight, there seems to be some misunderstanding about that.
    I don't see how that would work anyway.
        Mr. Poneman. I don't either, and I think it is a terrible
    thing that anyone ever thought that that made sense or was the
    policy of the Department. It is absolutely the wrong way to
    think about it.
        Mr. Barton. So we can assume, since you are the number two
    person, that whatever that concept was, it is no longer in use?
    It is gone?
        Mr. Poneman. Yes, we have tried and we will continue,
    because you can't repeat these messages often enough, to be
    very, very clear that the federal oversight is critical and it
    needs to be active and performance-based, and it cannot be
    ``eyes on, hands off.'' That would never work.
        Mr. Barton. OK, now my final question, can we be--can you
    assure the committee that the actual security of the weapons
    complex is a first-degree, primary function and it is not
    subject to cost issues? I mean, we want these facilities and
    materials and the people that are operating within those
    facilities to be secure, period, and not secondary to the cost
    of maintaining the security.
        Mr. Poneman. Let me be very clear, Congressman. There is
    nothing more important than the safety and the security of the
    complex. That is our top priority. We will always, as you would
    expect, make sure that we are good stewards of the taxpayer
    resources and not waste money. I don't think that is the
    implication of your question, but we will always make sure that
    we never compromise security for any other derivative
    objective, and the security of that material is paramount.
        Mr. Barton. Thank you, and thank you, Mr. Chairman and the
    other members. I yield back.
        I would love to have a hearing within the next year or two
    where we can pat these people on the back and say you have
    actually done what you said. Things are working. There are
    improvements. Now, I am a skeptic. I doubt we will have that
    hearing, but I certainly hope that we can and I especially want
    to commend Congresswoman DeGette. She has been fighting these
    fights almost as long as I have, and with the same degree of
    fervor and intensity, and I am sure that with Dr. Murphy's
    added vigilance, we might actually get something done. Thank
    you.
        Mr. Murphy. Thank you. We all share sentiments. Gentleman
    yields back.
        Now recognize the gentleman from New Mexico, Mr. Lujan, for
    5 minutes.
        Mr. Lujan. Thank you very much, Mr. Chairman.
        Mr. Poneman and Ms. Miller, before I ask some questions on
    Y-12, I want to speak about something that is very important in
    New Mexico. With the concerns in Washington State where tanks
    at Hanford are leaking radioactive and hazardous waste, I
    understand the Department is considering sending millions of
    gallons of highly radioactive waste to New Mexico to be stored
    at the Waste Isolation Pilot Plant, or WIPP. I would like to
    get your commitment here today that you will work closely with
    the New Mexico delegation, state and local officials, and
    concerned citizens, as you explore whether such a transfer will
    take place and under what conditions?
        Mr. Poneman. Congressman, I can assure you, A, that we
    always take all critical health, safety, environmental issues
    into account, certainly with respect to the 54 million gallons
    and their disposition at Hanford, and we will gladly continue
    to work very closely with this committee and with other members
    of the Congress to make sure what we do is in full consultation
    with you.
        Mr. Lujan. So Mr. Poneman, that is a commitment to work
    with the New Mexico delegation on this issue?
        Mr. Poneman. We will work with this committee and with all
    members of Congress, and any affected state----
        Mr. Lujan. I will interpret that as a yes. I appreciate
    that, sir.
        Has there been discussions that have begun with the State
    of New Mexico on this issue?
        Mr. Poneman. I will defer to Ms. Miller.
        Ms. Miller. The acting Assistant Secretary for
    Environmental Management, Dave Huizenga, has ongoing
    discussions with representatives from the State of New Mexico.
    I recently met with a number of representatives from the State
    of New Mexico, local representatives as well as the governor.
    We did not discuss this issue because this is a pretty new
    development, as you know, but we are in good, close contact
    with the delegation, both locally and certainly as Deputy
    Secretary Poneman said, very willing to work and look forward
    to working with you and the other members of the congressional
    delegation.
        Mr. Lujan. I appreciate that, Ms. Miller. I am one of the
    representatives as well that represents New Mexico, and so I
    would appreciate that very much. I appreciate that.
        And finally, I hope that this will not happen at the
    expense of cleaning up existing sites in New Mexico. I don't
    want to see a slowing down or a decrease in funding in
    environmental management funding. If anything, it should be
    increased to allow more rapid cleanup, especially in Los
    Alamos. And you know, with the true waste issue in New Mexico,
    it is ready to be cleaned up and ready to go, and I hope that
    we can work with you and get a commitment to see what we can do
    to plus up those accounts. I know sequestration is hitting us,
    but it is something that is very important to us.
        Mr. Poneman. Congressman, sequestration is a huge challenge
    for all of us. We have legal, contractual, and moral
    obligations to the state. We take them very, very seriously. I
    have been there several times myself. We will continue to take
    that seriously.
        Mr. Lujan. I appreciate your commitment, Mr. Poneman.
        Mr. Poneman, isn't your head of Health, Safety, and
    Security, or HSS, the person you and the Secretary rely on for
    developing and coordinating security policy and providing
    independent oversight and enforcement?
        Mr. Poneman. That is true.
        Mr. Lujan. Wasn't this a colossal failure as a part of HSS
    in failing to identify and correct the specific security
    weaknesses that were obviously present at Y-12?
        Mr. Poneman. Sir, there were a number of failures. There
    was a January, 2009, report from HSS which, in fact, identified
    some of the deficiencies which you have heard later described
    which, in fact, facilitated this terrible episode on July 28.
    There should have been, as HSS has acknowledged, more rigorous,
    vigorous, and repeated follow-up from those findings, and they
    have--in the consequences in terms of lessons learned from this
    episode, redoubled their commitment under the direction of the
    Secretary to make sure that they follow up on all such findings
    in future. So when they do identify a problem, they stick with
    it until it is resolved.
        Mr. Lujan. With that being said, Mr. Poneman, aren't those
    on the second panel, including reviewers like General Finan,
    who are identifying systemic security problems and recommending
    improvements, doing the job that HSS was supposed to have done?
        Mr. Poneman. Well, it is always good after an episode like
    this to get fresh eyes, and General Finan, because she had this
    unique perspective of being in the system but somewhat apart
    from these specific events, had a unique and invaluable
    perspective. In fact, her own report recommends that in this
    three-layer oversight review, that the HSS is, in fact, that
    third layer of disinterested third party oversight. We will
    hopefully continue to benefit from outside expertise of this
    character, but also make sure we maintain some independence
    within the Department to ensure you don't have conflict of
    interest in overseeing security.
        Mr. Lujan. I appreciate that.
        Mr. Poneman, in your earlier comments made before similar
    hearings, you stated that no federal employees have been
    terminated as a result of the Y-12 breach, that such
    terminations are subject to due process. Since there were
    contract employees that were terminated for cause, the response
    seems to suggest that contract employees don't have the same
    due process protection under the law. Is there any truth to
    that?
        Mr. Poneman. This is--I am glad you asked this question,
    Congressman. Let me clarify this. There was accountability on
    both the federal and the contractor's side. On the federal
    side--and we had to act swiftly and effectively to remove
    anybody who had an involvement in this episode from the chain
    of command. On the federal side, the top three nuclear security
    officials in headquarters were removed from those
    responsibilities. In addition, three members at the site from
    the federal team were either reassigned or removed from their
    positions. And then on the contractor's side, we held
    accountable by making clear to the contractor that they had
    lost our confidence. The three senior--three of the senior
    people on the protective force subcontract and three of the
    senior people on the M&O contractor, we then folded the
    subcontract for security under the M&O contract, made it clear
    we lost confidence in the contractor, and that contractor was
    terminated full stop.
        Now there are additional actions that can be taken with
    respect to individuals that are disciplinary in nature. Our
    first responsibility, as the chairman and ranking member have
    emphasized, is to protect the material, so the first thing we
    did is get anybody who had anything to do with this out of the
    way of possibly protecting material that we now needed to make
    sure we had new people and new processes to effectuate. Other
    disciplinary processes have been underway. Some are still
    continuing, and those are the processes, sir, that I was
    referring to where the due process protections apply to these
    individuals who, like any American, are entitled to due process
    when it comes to termination.
        Mr. Lujan. Thank you. Mr. Chairman, as I yield back, I know
    time is expired, but I appreciate the concerns and the
    statements associated with new culture and leadership and
    changes, and what that means coming forward as we look at the
    future. Thank you, Mr. Chairman.
        Mr. Murphy. Thank you, Mr. Lujan. I let that go on because
    it was a particularly important answer, too. We thank you for
    that answer.
        Now recognize the gentleman from Mississippi, Mr. Harper,
    for 5 minutes.
        Mr. Harper. Thank you, Mr. Chairman, and welcome to each of
    you on what is a very important topic, not only to you, but to
    everyone in Congress. We appreciate the look you are taking at
    this, and of course, how do you convey that security is
    everybody's concern, and always in that situation where you are
    looking, it seems that it was somebody else's responsibility,
    so you have to create that culture that everyone is
    responsible, regardless of their position, and do you feel like
    you are moving things in that direction with NNSA?
        Mr. Poneman. Yes, sir, and your comment, I think, ties in
    well with when the chairman said at the beginning, if you don't
    measure it, you don't manage it. What we have done since the Y-
    12 episode is to make sure that in the performance evaluation
    plans for all contracts that safety and security is made a
    constituent part of every programmatic deliverable. So you are
    not actually performing the job if you do it, but you don't do
    it safely or you don't do it securely. So that is how we
    measure and hold people accountable, and so not only are we
    trying to do this through all the cultural teaching that we are
    telling you about, but we are trying to build into the
    structure of the contracts. That is how we hope to avoid keep
    coming back, as Ms. DeGette has suggested, by really building
    it into our system.
        Mr. Harper. And I guess one of the issues would be how do
    you make these security changes or improvements, how do you
    sustain those? You know, I will go back, DOE did a major--a
    comprehensive study back in 2008, and it looked like that was
    great. If those things had perhaps really been sustained, maybe
    we wouldn't have had the Y-12 incident. So I guess what
    confidence should we have and do you have that these changes,
    as a result of this very extensive 90-day evaluation and study,
    will be sustained?
        Mr. Poneman. Congressman, as General Finan's report makes
    clear, even if we have put all the structures in place to be
    successful in a way that we have not succeeded so far, absent
    leadership, it is not going to succeed. So the first way to
    sustain it, sir, is by sustained leadership attention, and I
    can commit to you that that is what we are providing.
        The second thing I would say is, it is not enough simply to
    promulgate this and announce it. We have to continue to work
    with people in the complex at the sites and have a continuous
    flow of information back and forth.
        And the third thing is, people have to feel comfortable
    throughout the site. If they actually have concerns, they have
    to feel free to step forward without any fear of retribution.
        Mr. Harper. Thank you.
        Do either of the other witnesses have anything that you
    care to add? General, anything that you see of how this study--
    how you believe it would be sustained in the future? It looks
    great today, and we believe we have done that, but do you see
    anything else, other than what Mr. Poneman has added, that you
    believe would show that we could sustain it?
        General Finan. The key is the leadership, just the Deputy
    Secretary stated, and a culture. Everyone in the organization
    has to understand that each and every one of them are a part of
    security, and that security is a part of the NNSA mission. It
    is not a support item, it is essential to the mission. So it is
    culture and leadership.
        Mr. Harper. Mr. Poneman, the safety and security reform
    plan, if I could read this, stated that the Department's
    contractors maintain an assurance system that provides reliable
    measurement of the effectiveness of their safety management
    systems and facilitates timely corrective actions to systems or
    performance weaknesses. And the same direction was given for
    security systems. The task force found that NNSA relied
    overwhelmingly upon contractor-provided data rather than
    effectively reviewing performance itself. Given the broken
    equipment, security cameras, excessive false alarms at Y-12,
    clearly the contractor did not correct performance weaknesses
    in a timely fashion. And I know you have gone over this, but I
    want to make sure, you believe that relying on contractors to
    provide measurements of their effectiveness is still a sound
    approach?
        Mr. Poneman. I think the system must start because they
    have the line management responsibility with contractor
    reporting and self correcting, but it then needs exactly the
    oversight that General Finan recommended, number one, from the
    nuclear security operation inside NNSA, which is not at the
    site and therefore it is not prone to the coziness that has
    been a source of some concern, and then secondly, with a third
    party independent oversight from the HSS organization.
        Mr. Harper. Each of you, do you believe that today would
    such a breach at Y-12 that occurred in July of 2012, do you
    believe that would occur today?
        Mr. Poneman. No, sir, I do not, and one thing that we did
    immediately, the Secretary directed an extent of condition
    review to be done very quickly to ensure that no similar
    problems existed at any of the other sites that have Category I
    nuclear material in the complex.
        Mr. Harper. I yield back.
        Mr. Murphy. The gentleman yields back.
        The gentleman from Texas is recognized for 5 minutes.
        Mr. Green. Thank you, Mr. Chairman.
        Mr. Murphy. The gentleman Mr. Green from Texas is
    recognized.
        Mr. Green. Different member from Texas.
        I know there was some contract restructuring in 2007, and I
    guess what got my attention on Y-12 and also the Pantex site,
    since that is in north Texas, was that contract restructuring
    ever completed to have one contractor for both sites?
        Mr. Poneman. Yes, sir, we have finished the contract
    consolidation. There is another piece that is optional with
    respect to folding the tridium operations at Savannah River,
    but that part has not----
        Mr. Green. I know on a regular occasion, Pantex--there are
    protesters up there, but it is a long way to get there from
    most urban areas in north Texas, but there has never been any
    similar incidents like at Y-12 at Pantex, has it?
        Mr. Poneman. Not that I am aware of, sir, and in fact, we
    were impressed when we looked after the Y-12 incident at,
    frankly, the contrast and we brought some expertise from Pantex
    to Y-12 to help instill some best practices. For example, the
    practice of repairing cameras very quickly, that was already
    institutionalized at Pantex, and now I am happy to say, all the
    cameras are fixed and our average time to repair cameras now at
    Y-12 is 6.5 hours. So there were some best practices that we
    ported over from Pantex.
        Mr. Green. OK. I worry about impacts on NNSA due to the
    sequester. Deputy Secretary Poneman, can you talk about the
    impacts that sequestration may have on federal and contractor
    personnel at NNSA?
        Mr. Poneman. Yes, I will let Acting Administrator Miller
    offer more detail, but top line is it is a significant effect
    involving personnel and operations as well, but I can assure
    you, Congressman, is that the directive from the President is
    to do everything that we can and must do to protect our core
    functions. But I will ask Ms. Miller if she has got
    elaboration.
        Ms. Miller. I would just add to that. It starts with of
    course, we will protect the material, of course, we will do
    things safely. As long as we are allowed to operate, that is
    exactly how we will run things. Having said that, I think
    people have a tendency to look at sequestration in terms of
    numbers of people who might be furloughed or dollar numbers
    that might be missing. It is--what is a deeper concern at this
    point is the ongoing disruption to activities that will take
    projects and programs and make them difficult, if not
    impossible, to actually execute anywhere near to the plan and
    to the price and the need that has already been described. It
    is that ongoing uncertainty disruption, and then lack of
    ability to plan.
        Mr. Green. And I know that is impacting your agency, but it
    is also impacting----
        Ms. Miller. Everybody.
        Mr. Green [continuing]. Everybody.
        Have you already notified employees or contractors on they
    could face personnel actions?
        Ms. Miller. Contractors, their own organizations are
    responsible for talking directly to their employees, because
    they operate in general off of the money they are getting for
    us. We have, of course, worked with them to try to plan and
    program dollars so that they have some sense of what it is
    going to look like going forward month by month, and they are
    making plans and doing notifications accordingly, and I know
    our contractors have done that.
        As far as the federal workers are concerned, I sent a note
    out to our federal workers 2 weeks ago, almost 2 weeks ago, to
    let them know that we will do everything we can, but I cannot
    guarantee that it is not going to affect them either.
        Mr. Poneman. And I would only add, Congressman, that I have
    notified all the affected governors, and we will also work with
    the states in the same vein.
        Mr. Green. OK, thank you, Mr. Chairman.
        Mr. Braley. Would the Texas gentleman yield?
        Mr. Green. Sure.
        Mr. Braley. Mr. Chairman, Ms. Miller, a number of reports
    observed a culture within NNSA of prioritizing costs, cutting
    costs above the needs of security. As a follow-up to the
    question Mr. Barton asked, have M&O contractors throughout the
    complex been told to cut their security costs?
        Ms. Miller. They certainly have not been told to cut their
    security costs as any means of a policy, but I would say there
    is definitely messages that get communicated that when money is
    tight, people are looking for ways to cut costs and within an
    individual organization, a contractor organization are working
    with federal people, they may, as General Finan said, start to
    make decisions at very low levels on what their interpretation
    is of the need to cut costs.
        Mr. Braley. So it sounds like they could have been cut, so
    as a follow-up, have security funding allocations been reduced
    in recent years before the incident?
        Ms. Miller. Security allocations have come down over the
    last several years, that is right.
        Mr. Braley. Mr. Chairman, this is a concern I think that we
    had. Mr. Barton asked a similar question, and hopefully it is
    something that we can pursue. You know, I would be interested
    if security funding has been increased after the incident as
    well, but I think we will find that out later.
        Thank you, Mr. Chairman.
        Mr. Gardner [presiding]. Thank you. Gentleman yields back.
        Gentleman from Texas, Dr. Burgess, is recognized for 5
    minutes.
        Mr. Burgess. Well on the GAO report that was supplied for
    this hearing, there is a table, table one on page nine of the
    report, and you know, it is interesting in light of the last
    question that was just asked about the funding levels. I mean,
    this is a comparison of a GAO study done in May of 2003 and
    then the security task force in February, 2013, so essentially
    a decade worth of NNSA oversight. And you look at the various
    things that are listed there, the last one being allocating
    staff. In 2003, the GAO found NNSA had shortfalls in its site
    offices in number and expertise of staff, which could make it
    more difficult for site offices to effectively oversee security
    activities. OK, that sounds like a real problem identified by
    the GAO. So what did General Finan find 10 years later? The
    NNSA security function is not properly organized or staffed. It
    sounds like the same problem to me, stated another way.
        So you know, as interesting as this chart is, it really
    shows that the General Accountability Office's review of the
    NNSA security organization, when you look at it and go down the
    list and see the problems with defining clear roles and
    responsibilities, assessing site security activities,
    overseeing contractor activities, allocating staff in each and
    every case.
        So General Finan, you know, it begs the question, it is
    almost every problem that was identified 10 years ago, you
    encountered on your task force 10 years later. So what do you
    think? Are these longstanding cultural problems that are
    ingrained in the organization, or are these things that can be
    corrected?
        General Finan. Clearly they are long-term cultural basic
    issues that need to be fixed. And what happens over the years,
    as we looked at each one of those, reports would come out and
    people would check the box and say yes, I took care of the
    findings. What happened was people were nibbling around the
    edges, you know, they would put a body or two--oK, you have a
    shortage, so a body or two would change. You know, that would
    just create a shortage someplace else. They didn't ever stop
    and take a look at the overall system. How are we going to fix
    this long term? So by nibbling around the edges, instead of
    getting at the core issues, they just perpetuated the issues
    for a decade, and probably even longer than that, but every
    report that we looked at had striking similarities to what we
    found.
        Mr. Burgess. So let me just ask you this. This is a basic
    question. How is putting more money into a structurally
    deficient system, how is it going to make it better? I mean any
    amount of money--I agree that, you know, it is reasonable to
    look the funding levels, but for crying out loud, we have known
    about this stuff for 10 years and you haven't fixed it.
        General Finan. And fundamentally, you know, that is why I
    propose a change in the organization and change in the
    assessment model. Now I think that there are minor increases in
    budget that might be required, but we are not talking about,
    you know, hey, let's add a billion dollars to the security
    budget, because the issues that surfaced at Y-12 were
    structural within the organization and structural within the
    assessment model. Now there are other technical aspects of why
    the guard didn't respond properly, a whole bunch of things like
    that that are training related and things like that, but we
    are--when we are talking about the organizational structure, we
    are talking about some bodies. Yes, there is a shortage of
    security professionals, so you are talking a small number of
    additional bodies, and with the assessment model, you are
    talking about beefing up and changing the assessment model, but
    you are not talking about a massive influx of dollars.
        Mr. Burgess. Well, Chairman Upton in his opening statement
    said we need to learn the right lessons from past mistakes. I
    now certainly thank you for the effort that you have put into
    this. I just pray that 10 years from now another Congress is
    not having another hearing over the same sorts of failures.
        So Secretary Poneman, let me ask you. Back in 2010,
    Chairman Emeritus Barton was ranking member. He and I wrote to
    the Secretary expressing our concerns that the safety and
    security reform initiative would weaken outsource by
    outsourcing safety and security. We requested the General
    Accountability Office to evaluate--actually Chairman Waxman,
    who was chairman at the time and Ranking Member DeGette did
    join in that letter, so given the troubled history of safety
    and security in the complex, NNSA's problems of implementing
    its own security program, what was the Department's
    justification for embarking on this project?
        Mr. Poneman. It was clear at the time, Congressman, that we
    needed to focus, and you know the old saying, ``If you don't
    know where you're going, any road will take you there.'' So
    when I arrived at the Department, there were many people saying
    many different things. We said let's sit down and figure out
    what are we doing to be safe, what are we doing to be secure?
    That was the genesis of that reform. Our management principles
    say we will only succeed by continuous improvement. This was
    part of that process so it wouldn't just be mindlessly
    continuing to check the box, but being vigorous and aggressive
    and saying how do we be safe? I couldn't agree more with you,
    Congressman, in your premise that it ain't just throwing
    dollars at it, it is a deeply cultural thing, and that reform,
    which I know people have had some concerns about, was intended
    to be exactly part of the process that you are advocating in
    terms of a self-vigorous analytical process to get safe and to
    make people wake up, think, and be active about it.
        Mr. Burgess. Well, Mr. Chairman, I have got additional
    questions. I will submit those in writing. I thank you for the
    indulgence, and I will yield back.
        Mr. Gardner. Thank you. Gentleman yields back and the chair
    recognizes himself now for 5 minutes.
        General Finan, a question to you. In your testimony, you
    write that the NNSA is structurally inadequate to address
    security needs. You have made your recommendations. What
    percentage of those recommendations have either been
    implemented or on their way to implementation? Just give me a
    number, if you could.
        General Finan. At the time I left the organization, all of
    the recommendations were in process of being implemented.
        Mr. Gardner. Thank you.
        Additional questions to Ms. Miller, and this question was
    referenced earlier. The statement that Mr. Don Cook, NNSA
    Deputy Administrator for Defense Programs had made earlier, he
    said with regard to the relationship that we have and where we
    are between NNSA and its labs and plants, the statement was
    made ``eyes on, hands off.'' And I think one of the concerns
    that we have is this isn't just about management; this is about
    leadership, a culture of safety and security. And I am very
    concerned when it comes to the approach that NNSA, when they
    talk about ``eyes on, hands off,'' that this is actually a
    management style that is failing to provide the kind of
    leadership we need in safety and security. Would you agree or
    disagree with that?
        Ms. Miller. I think what is failing and what has failed is
    something I spoke a little bit about earlier, and that is it is
    one thing for people at a very senior level to talk at a very
    senior level and come out with phrases that they perfectly
    understand and they may be able to explain to the seven or
    eight people they talk to all the time about it. That is a very
    different thing if you are the person six, seven, eight layers
    down to understand what does that mean for the job you do every
    day?
        Mr. Gardner. And so you can see how that kind of creates a
    culture, though, that doesn't focus--that focuses more on
    management and less on leadership of a culture that is truly
    about safety and security.
        Ms. Miller. I think what happens is it leads everybody to
    focus whatever way they can to cope with what they think the
    person at the top is trying to tell them.
        Mr. Gardner. So what are you going to do to make that that
    is different?
        Ms. Miller. So as you know, right now I am acting
    administrator. What we have already begun in NNSA is a change
    in both the way we talk to staff and our contractors from the
    lower levels all the way up through the very top levels to be
    able to allow people to understand how they do--how they are
    meant to do what they do in a safe and secure way, and to
    understand that safety and security is not the job of the
    people--it is not just the job of the people in the uniforms or
    the guys who can discuss criticality safety in depth, it is
    everybody's job. It is what you do every day as part of what
    else you do every day.
        Mr. Gardner. Recognize it is about the leadership, not just
    management.
        Ms. Miller. Absolutely.
        Mr. Gardner. General Finan, in your testimony, you talked
    about tension between security and the conduct of operations,
    stating that the events at Y-12 illustrate how far the pendulum
    has swung too far in the wrong direction, and that NNSA must
    clearly and consistently emphasize the importance of security.
    Do you believe the tension between security and operations is
    inescapable, or do you think that strong safety and security
    culture can facilitate improved operations performance, given
    committed leadership?
        General Finan. I absolutely believe that safety and
    security can make operations better, and depending on how they
    are integrated, you will have a better operation. But it is a
    cultural change and it is a difficult cultural change.
        Mr. Gardner. Is the agency right now on the way to that
    cultural change?
        General Finan. They are trying to make that cultural
    change. Again, it is a long term. It will take years and
    constant pressure, constant attention.
        Mr. Gardner. Adequate progress, in your mind?
        General Finan. They are making early steps. Early steps. It
    is going to take a long time.
        Mr. Gardner. But adequate process not quite ready to say
    that?
        General Finan. I am not quite ready to say that.
        Mr. Gardner. Ms. Miller, do you agree with General Finan
    that there has been a culture of compromise at NNSA?
        Ms. Miller. Yes.
        Mr. Gardner. And what are you doing to eliminate that
    culture?
        Ms. Miller. That is a culture that I think not
    intentionally, but definitely effectively, has permeated both
    the contractor and the federal side of it, and that is a
    question of leadership making clear what the expectations are
    for all concerned.
        Mr. Gardner. And you believe you have taken the sufficient
    steps so that your senior managers understand that there must
    be consistent messaging on security?
        Ms. Miller. I think through a number of actions that have
    been taken, including the shakeup in management of security,
    that message has been very clearly communicated as to what is
    expected of everyone.
        Mr. Gardner. And can you tell the committee today, all of
    us on the committee, that the head of defense programs, the
    head of the budget, the federal site managers, your managers,
    all are now singing from the same hymnal, so to speak?
        Ms. Miller. I can tell you that they know they better be. I
    can't swear for another person, but I believe it to be the
    case.
        Mr. Gardner. And have you committed--this information that
    you are talking about now, you have communicated it simply--
    supply the committee with memoranda or other communications
    instituting your policy for emphasizing that security?
        Ms. Miller. Yes.
        Mr. Gardner. Thank you. I appreciate your time, and with
    that, I don't see any other witnesses, so I will give the gavel
    back to the chairman.
        Mr. Murphy. Thank you.
        We are going to dismiss this panel and move on to the next
    one. I do want to thank you all for your candid and thorough
    response, and this is extremely important to see leadership
    being honest with us. So we look forward to working with you
    more and talking with you more, and General, a special thanks
    to you for your report. Good luck over there, keep that Air
    Force in line. Thank you, ma'am.
        We will wait for the next panel to come forward.
        Ms. DeGette. Chairman, maybe we can just put her in charge
    of everything.
        Mr. Murphy. Well ma'am, I am Navy so we will have to
    discuss that.
        Well, while this next panel is getting ready, I will start
    off by introducing them in the interest of time as we move
    forward. We have with us Mr. C. Donald Alston, Major General,
    United States Air Force (retired), and former commander of the
    20th Air Force Global Strike Command, and Commander Task Force
    214 U.S. Strategic Command, Francis E. Warren Air Force Base in
    Wyoming. We also have Mr. Richard Meserve--am I pronouncing
    that right, sir?
        Mr. Meserve. Meserve.
        Mr. Murphy. Meserve, thank you, President of the Carnegie
    Institution for Science, and former Chairman of the U.S.
    Nuclear Regulatory Commission from 1999 to 2003. We also have
    Mr. David Trimble, the Director of Natural Resources and
    Environment Team, Government Accountability Office. Welcome
    here today.
        As you know, the testimony you are about to give is subject
    to Title XVIII Section 1001 of the United States Code. When
    holding an investigative hearing, this committee has a practice
    of taking testimony under oath. Do you have any objection to
    testifying under oath?
        They all agree to testify. The chair then advises you that
    under the rules of the House and rules of the committee, you
    are entitled to be advised by counsel. Do you desire to be
    advised by counsel during your testimony today?
        They all decline counsel.
        In that case, if you would please rise, raise your right
    hand, and I will swear you in.
        [Witnesses sworn.]
        Mr. Murphy. Thank you. I note for the record all the
    witnesses have answered in the affirmative.
        You can now give a 5-minute summary of your written
    statement. We will start with you, Dr. Meserve.

         TESTIMONY OF RICHARD A. MESERVE, PRESIDENT, CARNEGIE
    INSTITUTION FOR SCIENCE; C. DONALD ALSTON, MAJOR GENERAL, USAF
     (RETIRED); AND DAVID C. TRIMBLE, DIRECTOR, NATURAL RESOURCES
         AND ENVIRONMENT TEAM, GOVERNMENT ACCOUNTABILITY OFFICE

                    TESTIMONY OF RICHARD A. MESERVE

        Mr. Meserve. Mr. Chairman, Ranking Member DeGette, and
    members of the subcommittee, I am very pleased to appear before
    you this morning to testify of the security at DOE complex.
        My involvement with this issue, and I believe General
    Alston's as well, arose as the result of a request that was
    made by Secretary Chu that we, as well as Dr. Norm Augustine,
    undertake an evaluation of basically the structure for the
    management of security at DOE. We undertook a study that
    involved visiting sites, reviewing documents, interviewing
    people, and as a result of all of that effort, we submitted
    three separate letters to the Secretary on December 6 of 2012,
    and we have submitted copies of those letters for the record as
    our testimony.
        We did not purport to investigate the factual circumstances
    surrounding the Y-12 institute. Our reports focused on
    management-related issues, and I hasten to add that our report
    was a snapshot in time. I was learning a lot about what has
    happened at DOE since we conducted our interview from the very
    informative testimony that we have all benefitted from earlier
    this morning.
        There are a couple of points from my letter that I think I
    would like to emphasize that I see as clear issues that DOE
    should confront. I believed that on December 6, and I believe
    they are confronting them. One, and I think a critical one, is
    to make sure you have a management structure in place that
    assigns clear authority and responsibility for security. One of
    the underlying factors at the Y-12 incident is there was a
    division of responsibility and without anyone being truly in
    charge until you had a situation with a contractor responsible
    for the guards and a different contractor responsible for the
    security-related equipment and the cameras, and they weren't
    communicating well and a lot of the equipment was out of
    service and each could point at the other.
        I also came to the conclusion--and I will let General
    Alston speak for himself--that the federal oversight needed to
    be improved. It was--serious security issues existed before
    this episode and no one at DOE that we saw was really on top of
    detecting them and correcting them.
        There was issues associated with the protective force,
    ensuring appropriate training. There was an issue associated
    with the, obviously, the behavior of the first responder. There
    were many issues associated with the protective force that need
    to be addressed. We need to find a clear trajectory for these
    people. We need to make sure that they have a sense that they
    are an important part of the team and integrated with the team.
        I think that all of us came to the view--and this has been
    emphasized this morning--that one of the things needs to change
    is the culture. There has to be a security culture that places
    both safety and security as highest priorities, and that
    management by its word and deed reinforces that, and that
    everyone at the site realizes that it is their individual
    responsibility to assure security, and that clearly is
    something that has been failing.
        And finally, I think what I would add is a need for
    balance. Clearly, this episode reflected issues associated with
    physical security, but there are other security issues that
    confront the Department, and in order to recognize, you need a
    balance. There are cybersecurity issues, there are personnel
    security issues, all of which need to be functioning, and one
    ought to not, because it was an episode of physical security,
    focus solely on that.
        My views are explained more fully in the letter that was
    submitted as part of the record, and I welcome the opportunity
    to talk to you this morning.
        Mr. Murphy. Thank you. General, I promised you I would have
    you go first. I apologize for the confusion there, but you are
    recognized now for your opening statement.

                     TESTIMONY OF C. DONALD ALSTON

        General Alston. Mr. Chairman, Ranking Member DeGette,
    members of the subcommittee, I would only briefly amplify what
    my colleague has so well described as Mr. Augustine's, Dr.
    Meserve's, and my efforts on behalf of Dr. Chu and the
    Department of Energy. I would only amplify one particular
    point, and that would be the culture piece.
        We have talked this morning--the first panel engaged you in
    conversation using some of the expressions that we found to be
    of concern, ``eyes on, hands off'' for example, and that
    expression is something that came out of just the last couple
    years of policy changes. But as has been reinforced over and
    over again, the recurring challenges, the similar recurring
    challenges, go beyond the ``eyes on, hands off'' policy
    emphasis that had occurred over the last years, and I think
    that at the center of the challenge for the Department is the
    cultural change. And one aspect of the cultural change that
    is--that feeds the cultural challenges is the distributed
    management, the way the Department distributes its management
    across its labs, and the labs prefer and are very successful in
    their pursuit of the distance between the headquarters and the
    labs themselves, and the freedom of movement that they have,
    and this has great value, I would concede, on the science
    piece, but I think that that contributes--the security, in
    fact, needs to have more central--management central emphasis,
    common standards, and what I have observed is that you see
    people talk about mission, which I read as science. People talk
    about safety, and there is more of a pervasive safety culture,
    if you will. But security is not everybody's responsibility,
    and it is as if mission, safety, and security are in a trade
    space where when there is an emphasis on security because of an
    episodic failure, the other elements of mission and safety see
    the focus on safety as to be marginally at the expense of the
    other parts of the mission, as opposed to looking at it as an
    enterprise challenge, and that, in fact, they don't share trade
    space with each other, but in fact, are all essential every day
    to mission success.
        And with that, I thank the committee for the opportunity to
    have dialogue this morning.
        [The joint prepared statement of General Alston and Mr.
    Meserve follows:]

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        Mr. Murphy. Thank you very much.
        Mr. Trimble, you have a chance for an opening statement.

                     TESTIMONY OF DAVID C. TRIMBLE

        Mr. Trimble. Thank you, Chairman Murphy, Ranking Member
    DeGette, members of the subcommittee. My testimony today
    discusses DOE's and NNSA's management of the nuclear security
    enterprise, and will focus on security, safety, and project and
    contract management.
        Multiple investigations into the security breach at Y-12
    identified significant deficiencies in NNSA's security
    organization, oversight, and culture. In response to the Y-12
    security incident and the findings of these reports, DOE and
    NNSA have taken a number of actions, including repairing
    security equipment, reassigning key security personnel, and
    firing the Y-12 protective force contractor. More recently, DOE
    and NNSA's leadership committed to additional actions, such as
    revamping the security oversight model. We have not evaluated
    these recent actions but will examine them as part of our
    ongoing review on security reform for this committee.
        The key question underlying this work will be whether DOE's
    actions to address the security breakdowns at Y-12 will produce
    sustained improvements in security across the nuclear security
    enterprise.
        DOE has a long history of security breakdowns and an
    equally long history of instituting responses and remedies to
    fix these problems. The recent testimony the leader of the NNSA
    security task force examining the Y-12 incident identified
    problems at NNSA's federal security organization, including
    poorly defined roles and responsibilities for its headquarters
    and field staff, inadequate oversight and assessments of
    secured activities, problems ensuring that security
    improvements are implemented, and failing to ensure adequate
    staffing. Notably, in 2003, we reported on these same problems,
    problems which have persisted or resurfaced, notwithstanding
    numerous DOE initiatives to fix or address them.
        In examining the security incident at Y-12, it is also
    important to remember that NNSA's security problems have not
    been limited to Y-12. In March of 2009, we reported on numerous
    and wide-ranging security deficiencies at Livermore,
    particularly in the ability of Livermore's protective forces to
    ensure the protection of special nuclear material and the
    laboratory's protection control of classified material. We also
    identified Livermore's physical security systems, such as
    alarms and sensors, and its security assurance activities as
    areas needing improvement. Weaknesses in Livermore's contractor
    self-assessment program and the Livermore site office's
    oversight of the contractor contributed to these security
    deficiencies at the laboratory.
        Los Alamos experienced a number of high profile security
    incidents in the '90s that were subject to numerous
    congressional hearings, including some held by this committee.
    Subsequently, security evaluations through 2007 identified
    other persistent systemic security problems, including
    weaknesses in controlling protecting classified resources,
    inadequate controls over special nuclear matter, inadequate
    self-assessment activities, and weaknesses in the process Los
    Alamos uses to ensure that corrects identified security
    deficiencies. In October of 2009, we found weaknesses at Los
    Alamos in protecting the confidentiality, integrity, and
    availability of information stored on and transmitted over its
    classified computer network.
        Regarding safety, in September of 2012, we testified before
    this subcommittee, noting that DOE's recent safety reforms may
    have actually weakened independent oversight. Notably, since
    this recent testimony, reports by DOE and the safety board have
    continued to identify safety concerns at Y-12, Pantex, and Los
    Alamos.
        Regarding project management, DOE has made progress in
    managing the costs and scheduled non-major projects, those
    costing less than $750 million, and in recognition of this
    progress, GAO has narrowed the focus of our high risk
    designation to major contracts and projects. Major projects,
    however, continue to pose a challenge for DOE and NNSA. In
    December of 2012, we reported that the estimated cost to
    construct the waste treatment and immobilization plant in
    Hanford, Washington, had tripled to $12.3 billion since its
    inception in 2000, and the scheduled completion date had
    slipped nearly a decade to 2019. Moreover, we found that DOE
    had prematurely rewarded the contractor for resolving technical
    issues and completing work. We have reported on similar
    problems with the CMR facility at Los Alamos, the EPF project
    at Y-12, and the MOX project at Savannah River.
        In conclusion, over a decade after NNSA was created to
    address security issues, the Y-12 security incident has raised
    concern that NNSA has still not embraced security as an
    essential element of its mission. The numerous actions that DOE
    and NNSA are taking to address its security problems will
    require effective implementation across the complex. Without
    this and strong and sustained leadership, these recent reforms,
    like past efforts, may not have a lasting impact on the
    security, performance, or culture of the agency.
        Thank you. I would be pleased to answer any questions you
    may have.
        [The prepared statement of Mr. Trimble follows:]

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        Mr. Murphy. Thank you. We will go through these quickly.
        I want to start off. Dr. Meserve, one of the messages from
    your work and General Alston's work is the lack of an embedded
    security culture from DOE headquarters on down through the
    various nuclear weapons complex facilities. As a former
    chairman of the Nuclear Regulatory Commission, you have
    experience with embedded safety culture. Am I correct on that?
        Mr. Meserve. That is correct.
        Mr. Murphy. And the lessons--what lessons, from your
    experience of NRC regulation of the civilian nuclear industry
    can apply to establishing strong security culture at DOE's
    facilities and operations? Can you give us an example?
        Mr. Meserve. Well, let me say that I think that perspective
    of the NRC has been that a safety culture is the critical
    foundation for ensuring the safe operations of the plants. That
    without that commitment, you have a problem that in regardless
    of how detailed the requirements are, ultimately you have to
    demand the people fulfill their obligations and take
    responsibility, and the safety culture, which is something that
    affects everyone in the plant, is the foundation.
        So I came to this project with that perspective, and I
    think that, as has been mentioned, and General Alston
    emphasized this in his remarks, is that culture is the critical
    ingredient, and that is something that has to change to have
    something that will be sustained over time. People see this as
    responsible as their clear responsibility at every level at the
    facility and at headquarters.
        Mr. Murphy. And that is the same as sustained training for
    security personnel, I am assuming?
        Mr. Meserve. It means sustained training. It means a
    responsibility of everyone in the plant, when they see a
    problem, to raise that issue up. If their immediate supervisor
    doesn't take it up, it means going above that person. It means
    having a system in place so that no one is--faces any
    discipline or discrimination as a result of the fact that they
    have raised an issue like that. It is people to be rewarded if
    they take initiative to respond. And that is the sort of thing
    you need in the security area as well.
        Mr. Murphy. Thank you.
        General Alston, you stated in your report that nuclear
    weapons sites leverage their unique missions and geography to
    justify a preferred, what you called ``alone and unafraid''
    mantra, and that DOE and NNSA headquarters has employed a
    largely hands off response. What do you mean by ``alone and
    unafraid?''
        General Alston. Mr. Chairman, at Y-12 specifically, earlier
    in the year, earlier in calendar year 2012, the site security
    apparatus had upgraded their security system, and they--there
    was a multi-$100 million option, and this was still a very
    expensive option of, I can't remember, $60 to $70 million. And
    so they went forward with this $60 to $70 million modification
    to their overall security capability at the site, but when they
    deployed that capability early in the year, it had flaws that
    needed to be worked out, and that was widely known, but they
    operated anyway, generated hundreds of alarms, false alarms or
    nuisance alarms a month, conditioned the force, I would argue,
    to not respond with urgency because they were being conditioned
    that the alarms are systemic shortcomings. There was--they
    moved towards the accounting for the alarms and less running to
    the sounds of the guns, which I think was manifested on the
    morning of July 28, because of the delayed response, because it
    was another false or nuisance alarm, if you will. And in that
    whole effort, though, was--from my perspective--was Y-12 saw a
    way to improve its security, and in my view, I saw evidence
    they conceived, designed, developed, and deployed this
    capability at Y-12, defending their unique geographical
    challenges to secure that facility, and in making their, if you
    will, one off approach to this, to be dominant between the
    relationship between Y-12 and the headquarters. And so there
    was not evidence of a strong, disciplined, central management
    of security modifications so that the field can, soup to nuts,
    take a look at what they determined to be shortcomings, and
    then worked the solution set on their own without what I think
    is more appropriate, a good operational test evaluation program
    where someone is accountable in the headquarters for the next
    gate you go, and that nobody lives with a sub-optimized system
    that is not operating perfectly on day one.
        Mr. Murphy. Is this systemic across NNSA?
        General Alston. Well, we found a different approach at
    Pantex. I can't tell you the current state of this, so maybe
    Dr. Meserve can amplify this, but the ARGOS system, and I can't
    tell you what the acronym stands for, but it is a comprehensive
    security approach that is present at all of their sites. But
    depending on how you manipulate part of the overall ARGOS
    architecture at your particular site, they may not be precisely
    identical at each one of the facilities. So as these folks were
    trying to integrate the changes to their security apparatus and
    blend in to this ARGOS concept, there is so much freedom of
    movement at each one of the sites that I think there is great
    opportunity being missed trying to centralize common standards
    and force a common approach and making the sites defend being
    different than the common approach, as apposed to right now,
    which is give them the benefit of the doubt that they need to
    support the one off approach and that the common standards get
    subordinated to the unique approach. I don't know if I said
    that right.
        Mr. Murphy. Thank you. That helps a lot, but as this goes
    through, I can't help, as I am hearing these stories about
    security issues, too, of the people watching the radar on Pearl
    Harbor on December 7 said oh, pay no attention to those blips,
    that is just probably our planes coming over, or on 9/11. These
    things continue on, and hope that the security force is not
    going to just look past these things. I mean, to recognize a
    situation like this, as Mr. Meserve, you put in your letter
    that sometimes training of terrorists is to look
    nonthreatening, and you have to be ready for deadly force, and
    this could have ended up in a deadly situation, and we are
    hoping these things are avoided in the future.
        I am out of time. I am going to go Ms. DeGette now from
    Colorado.
        Ms. DeGette. Thank you very much, Mr. Chairman.
        Mr. Trimble, when you were reciting the whole litany of
    problems that we have had with the various labs, it was like I
    was reliving my congressional career. So I want to ask you,
    have you read General Finan's report?
        Mr. Trimble. Yes, I have.
        Ms. DeGette. And what is your opinion of her
    recommendations?
        Mr. Trimble. You know, all the recommendations sound sound.
    We have not done a full evaluation or anything of that nature.
    I think our reaction to the reports, as well as the actions DOE
    has already taken is sort of the proof is in the pudding.
        Ms. DeGette. Yes, so you think it is a good direction, but
    you want to make sure it gets implemented?
        Mr. Trimble. Yes, and I think even more than that, it would
    be where is the implementation plan?
        Ms. DeGette. Right.
        Mr. Trimble. So we have got a lot of oK, we are going to do
    this, we are going to do that, but where is the DOE summary of
    all of these efforts saying hey, this is our assessment of all
    this good work these people have done, and here is our plan
    with metrics and dates and who is accountable going forward.
        Ms. DeGette. OK. And General, have you read General Finan's
    report?
        General Alston. No, ma'am, I have not.
        Ms. DeGette. OK.
        General Alston. Her report was in draft while we were
    essentially commissioned by Secretary Chu.
        Ms. DeGette. Are you familiar with her recommendations?
        General Alston. I am familiar with a lot of them. I
    couldn't recite them for you.
        Ms. DeGette. I am not asking you to. Good news, I only have
    5 minutes.
        So my question, though, is do you think she is going in the
    right direction with her recommendations, based on your
    assessments?
        General Alston. I do. Where I was encouraged particularly
    by her approach was trying to certainly recognize the field
    shortcomings, but the headquarters chain----
        Ms. DeGette. Right.
        General Alston [continuing]. Needs to be fixed, and it
    needs a solid focus on it.
        Ms. DeGette. It needs to be clarified, right?
        General Alston. Absolutely.
        Ms. DeGette. Yes, what about you, Dr. Meserve?
        Mr. Meserve. My response would be the same.
        Ms. DeGette. OK. Now every few years--I alluded to this in
    my previous questioning. Every few years, some in Congress
    suggest that NNSA should be autonomous. From oversight last
    year, the House passed the National Defense Authorization Act
    that included a provision providing additional autonomy from
    oversight by this committee, for example, for NNSA. Luckily,
    this language was not in the final law and part of our job is
    to make sure that we have adequate oversight, so we are glad it
    wasn't in the final law. I think, and all of us on this
    committee think, the Y-12 security breach shows that the NNSA
    is simply not ready for that level of autonomy that the
    National Defense Authorization Act contemplated.
        So General, I want to ask you and Mr. Meserve, were any of
    the issues you identified caused by a lack of autonomy for
    contractors and those who worked for Y-12? Were they caused by
    a lack of autonomy?
        General Alston. I would say that the consequence of the
    relationship between the semi-autonomous nature of NNSA and the
    Department of Energy did cause a conflict in ambiguity for
    policy, and so, the NNSA was dependent upon Department of
    Energy apparatus for independent inspection by HSS and the
    Inspector General properly so.
        Ms. DeGette. So what you are saying is the autonomy that
    they had actually caused some of the problems?
        General Alston. That they didn't have sufficient autonomy
    for them to be exclusively accountable for the failure.
        Ms. DeGette. OK, and that was because they were partially
    reporting to DOE?
        General Alston. Because the field would look up the chain
    of command, and there were limits to how beholden they were to
    the NNSA because certain policy elements were the purview and
    domain of organizations in the headquarters that were outside
    the----
        Ms. DeGette. So it was because it wasn't fish or fowl, they
    were semi-autonomous, right?
        General Alston. Yes, ma'am, and Dr. Meserve may have a
    better way to say this from our perspective.
        Ms. DeGette. Dr. Meserve?
        Mr. Meserve. I think that part of the problem was not the
    autonomy of NNSA but the fact that there is a very confusing
    structure.
        Ms. DeGette. Within the agency.
        Mr. Meserve. If something was simplified and then clear
    lines of authority and responsibility is what is necessary.
        Ms. DeGette. Right.
        Mr. Meserve. That could be done with an autonomous NNSA. It
    could be done with the current structure, but having clear
    guidelines of who is in charge of what.
        Ms. DeGette. The problem wasn't--yes, I got you. The
    problem wasn't whether it was autonomous or not, the problem
    was there wasn't a chain of command.
        I want to ask you very quickly, Mr. Trimble, do you think
    that--does the GAO believe that NNSA's issues can be solved
    through a simple structural change?
        Mr. Trimble. We have previously testified that we do not.
    We think the issues that need to be addressed can be done with
    the current structure, and again, it is cultural changes,
    sustained effort.
        Ms. DeGette. Thank you.
        Mr. Murphy. The gentlelady yields back.
        Now recognize the gentleman from Ohio, Mr. Johnson, for 5
    minutes.
        Mr. Johnson. Thank you, Mr. Chairman, and gentlemen, thank
    you for being with us today.
        Dr. Meserve, if the Department of Energy office responsible
    for independent oversight is subjected to political retaliation
    for conducting that oversight, how would that impact their
    ability to remain objective and independent, in your view?
        Mr. Meserve. Well I mean, the obvious danger is that if
    they are being criticized for doing their job that they will
    then back off doing what they are supposed to be doing. And so
    I think that that would be unfortunate, that if they didn't
    have a clear view of what their obligations were and their
    mission is.
        Mr. Johnson. OK. General Alston, what is your view of the
    importance of independent oversight?
        General Alston. I think that it is appropriately integrated
    in a mosaic of sensors and indicators to tell you how sturdy
    your readiness, or in this case, the quality of the security. I
    think that if you move too much towards depending on
    independent inspection and evaluation, you are missing great
    opportunity to have--to defend yourself against crisis. You are
    focused on defending against crisis and ultimate failure, but
    you are not taking advantage of building routine relationships
    and seeing whether or not your organization has the capacity to
    recognize failure when the conditions begin to present
    themselves. If you need someone outside to tell you how ready
    you are, you may not have the skill yourself to know yourself.
    So I believe it needs to be a mosaic of inputs that are
    converging at the right level to give the leadership at the
    local, intermediate, and the higher levels the competency and
    the confidence in just what the quality of the performance of
    the unit is.
        Mr. Johnson. I couldn't agree with you more, and it is
    analogous to--I know in my 26\1/2\ year career in the Air
    Force, you have your unit mission, you have standards and
    evaluation who are the internal looks, eyes, and ears to make
    sure that you are following those rules, but you also have the
    Inspector General who takes a look from the outside, and both
    are very, very important.
        Back to the issue, though, of political retaliation. To
    both of you, what impact would political retaliation have on
    safety and security, the culture of safety and security? You
    mentioned, Dr. Meserve, that people would just stop.
        Mr. Meserve. Well, you need to have a system that
    reinforces the priority that is to be given for safety and
    security, and that anything that interferes with the capacity
    for people to have a willingness to confront those issues
    honestly and to address them thoroughly is a detriment to
    achievement of safety and security. And that could be through
    political process, through fear of retaliation by a superior,
    there is any number of things that could affect it, but the
    point here is to keep your eye on the ball and anything that
    distracts you from that is a negative factor.
        Mr. Johnson. Sure.
        Mr. Meserve. And I couldn't agree more with General Alston
    is that one ought not to anticipate that you are counting on
    oversight function as your primary means to prevent shortfalls.
    That responsibility has to be in the line organization that is
    responsible for the job, and they should be held accountable
    for it. The oversight is a protective mechanism to make sure
    that they are fulfilling their function adequately and
    appropriately.
        Mr. Johnson. Absolutely.
        General Alston. And sir, I would add just one point, and
    that is if you don't have at a grass roots level the kind of
    environment where the folks will come forward to expose
    weakness and challenge, you are not going to get to the self-
    critical culture--the level of self-critical culture that you
    really need in this business where the stakes are so high.
        Mr. Johnson. Yes, I couldn't agree with you more.
        General, given the site's, I quote, ``alone and unafraid''
    posture, how important, in your opinion, are standardization,
    benchmarking, and best practices to achieving and sustaining
    high security levels?
        General Alston. Sir, clearly they feed every day. When you
    can, on a routine level, have the lines of communication
    sufficiently open where there is collaborative process, and
    standards don't have to be issued from above, there can be
    collaboration. It builds trust, it builds flow of information
    up and down the chain. Myself and Mr. Augustine came to the
    conclusion that the federalization of the correct protective
    force should be given serious consideration, and the reason--I
    am a unity of command guy, and that creates a seam with the
    operator, who is enriching uranium or whatever the other part
    of the mission would be, and so it is a little odd for me to
    have come down on this side. But for precisely the reasons of
    standardization and more centralized control and impact that I
    felt that that would be one means by which that could be
    achieved.
        Mr. Johnson. Well thank you. Mr. Chairman, I actually do
    have one more question, if it would please the chair that I
    could ask it, otherwise I will yield back.
        Mr. Murphy. We will give you an additional minute.
        Mr. Johnson. OK.
        General Alston, one final question. General Finan's task
    force noted a distinct bias against finding and stating
    performance criticisms. You stated your belief that one of the
    attributes of a security organization is, and I quote, ``an
    absolute intolerance for shortfalls, deficiencies, outages 1
    minute longer than necessary.'' What must happen for NNSA to
    transition from General Finan's assessment to the attribute
    that you describe?
        General Alston. I played an active role as the Air Force
    was recovering from its epic failures. I was required to
    produce a road map, and there were a lot--obviously we were on
    fire, and there were a lot of activities that had to go on
    there. But one of the things that we instituted was to find
    structural mechanisms to prove leadership commitment, and so
    the Chief and Secretary created a nuclear oversight board that
    met quarterly, and it was a forum where everyone with nuclear
    equities at the senior level would meet. But it was a forum
    where you could expose whatever level of detail that you wanted
    to expose, and in the case of the failure that we saw at Y-12,
    it wouldn't require so much the senior levels at NNSA, but
    there needs to be a process where the connection is reinforced
    so that you are tracking outages to the right level, and for
    example--or equipment shortages, and that there is a recurring
    forum so that routine interaction can fortify commitment to the
    security part of the enterprise.
        Mr. Johnson. Thank you, General.
        Mr. Chairman, I yield back.
        Mr. Murphy. All right, now recognize the gentleman from New
    York, Mr. Tonko, for 5 minutes.
        Mr. Tonko. Thank you, Mr. Chair.
        The obvious major part of NNSA's work is security, but
    equally important is providing their employees with a safe
    working environment. The consequences of safety failures are
    serious and for example, in October of '07, GAO reported that
    nearly 60 serious accidents or near-misses had occurred at
    NNSA's national labs since 2000. Just to give one example, GAO
    described a 2004 accident where a student working at the NNSA
    facility at Los Alamos was blinded in a laser accident.
        Mr. Trimble, you had indicated in your testimony that GAO
    has been conducting assessments of safety at NNSA for quite
    some time, and while I heard some of the results being
    mentioned here, I am more--I would like to know, more
    importantly, how the agency is fairing. Are they getting better
    at addressing safety concerns?
        Mr. Trimble. I would like to say yes, but as of now, I
    can't say that our work is showing that. I think one of the
    things that is relevant to the discussion today that ties into
    the safety and security reform initiatives from 2010 is we have
    previously reported that those initiatives did not address our
    concerns previously expressed regarding the safety culture at
    NNSA and specifically, we noted that some of those reforms we
    viewed weakened federal independent oversight by making HSS's
    role sort of more of a ``Mother, may I'' in terms of being able
    to come in and inspect facilities. And I think in our testimony
    as well, we note since our last testimony on these matters in
    the fall, there have been numerous other safety incidents that
    have been reported. So our concerns necessarily continue.
        Mr. Tonko. Thank you. You also made mention, and I will
    quote, that ``they have not demonstrated sustained improvements
    in terms of their safety reforms.'' Can you tell us about
    NNSA's recent efforts to reform those measures in terms of
    safety protocols?
        Mr. Trimble. I don't know about protocols, per se. I think
    the 2010 safety initiative, the reform initiative, you did a
    lot to--there is a lot of good in there in terms of
    consolidating or rationalizing directives, et cetera. Again, as
    I noted, we saw problems with it, but as with security, the
    issue is one of sustainment. You go through these same periods
    of an accident happens, it gets attention, you have remedial
    measures, and then attention wanes and you go through the same
    cycle once again.
        Mr. Tonko. So then what should the agency do or be doing to
    promote or improve worker's safety?
        Mr. Trimble. Well, I think again it is--one, it is a
    continued and sustained effort in addressing sort of a cultural
    issues that have crept in. I think you see, just as in security
    where you have the divide between headquarters and the field
    units, there is a divide there in terms of the importance and
    differing perceptions, perhaps, of the level of importance this
    sort of mission holds.
        Mr. Tonko. And in terms of any oversight protections?
        Mr. Trimble. In terms of oversight? Well, independent--
    clearly, we haven't been on the record in terms of having
    robust independent oversight, much like in the security realm,
    so bolstering the role of HSS in that regard I think is
    essential.
        Mr. Tonko. OK. I will yield back, Mr. Chair.
        Mr. Murphy. Thank the gentleman, and I want to say that for
    all the panelists, I thank you today, both panels. I also want
    to note that certainly at times like this when we have hearings
    about security issues, security breaches, there are those who
    want to see where weaknesses are. They certainly take note of
    the comments made, and we recognize a lot of the things are
    being done for security remain certainly in the classified
    levels. But in a situation like this, I think it gives the
    ranking member and I and members of both sides of the Aisle
    confidence to know that actions are being taken, because in a
    world where terrorists on any level may take action against our
    interests at site such as this or other ones, that our Nation
    will be strong and stand up and prevent problems in the future
    with this. And so we thank you for your comments and good
    Americans to help us with that security.
        I ask unanimous consent that the contents of the document
    binder and all the Majority memos be introduced into the
    record, and authorize staff to make appropriate redactions.
    Without objection, the documents will be entered into the
    record with any redactions the staff determines appropriate.
        [The information appears at the conclusion of the hearing.]
        Mr. Murphy. And in conclusion, again, thank you to all the
    witnesses. I remind members they have 10 business days to
    submit questions for the record, and I ask all the witnesses
    agree to respond promptly to the questions.
        This committee is now adjourned. Thank you.
        [Whereupon, at 12:15 p.m., the subcommittee was adjourned.]
        [Material submitted for inclusion in the record follows:]

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