Page 1 GAO–02-868R External Regulation of DOE

United States General Accounting Office

Washington, DC 20548

June 26, 2002

The Honorable Sonny Callahan

Chairman

The Honorable Peter J. Visclosky

Ranking Minority Member

Subcommittee on Energy and Water Development

Committee on Appropriations

House of Representatives

Subject: Department of Energy: Observations on Using External Agencies to

Regulate Nuclear and Worker Safety in DOE’s Science Laboratories

Unlike other government and private industrial facilities in the United States, virtually

all of the Department of Energy's (DOE) vast complex of research and nuclear

facilities is not inspected or licensed by an independent external regulator, such as

the Nuclear Regulatory Commission (NRC), to help ensure safe operations. Instead,

DOE and its predecessors1

 have, since 1946, been granted legislative authority to selfregulate nuclear and worker safety in the department’s facilities. We have long

criticized DOE for weaknesses in its self-regulation of the environment, safety, and

health (ES&H) at its own facilities.

DOE recognized the need for external safety regulation in 1993, when Secretary Hazel

O'Leary announced that the department would seek external regulation for worker

safety. In 1994, legislation was proposed and hearings held on externally regulating

nuclear safety at DOE facilities. Although no legislation was enacted, DOE

responded by creating advisory groups to help formulate its policies and implement

plans to eliminate self-regulation of nuclear and worker safety in all of its facilities.

To achieve this goal, in 1996 DOE endorsed recommendations to phase out its selfregulation practices over a 10-year period. In late 1997, however, DOE took a more

cautious approach when Secretary Federico Peña embarked on a 2-year pilot program

to simulate regulation by the Nuclear Regulatory Commission and the Occupational

Safety and Health Administration (OSHA) at selected facilities.2

 The objectives of

these simulations included testing regulatory approaches and determining the cost of

 1

 DOE’s predecessor agencies are the Atomic Energy Commission and Energy Research and

Development Administration.

2

 These facilities include all or part of the Lawrence Berkeley National Laboratory in California, the

Oak Ridge National Laboratory in Tennessee, and the Savannah River Site in South Carolina. OSHA

participated in the California and Tennessee sites and had previously conducted a pilot program at

DOE's Argonne National Laboratory in Illinois.
Page 2 GAO–02-868R External Regulation of DOE

moving to external regulation. Despite NRC and OSHA conclusions from these pilots

that externally regulating DOE’s science laboratories is achievable, Secretary Bill

Richardson decided not to pursue external regulation, citing cost and other

regulatory uncertainties. In this context, we reported in 1998 (and again in

congressional testimonies in 1999 and 2000) that DOE did not have a clear strategy on

external regulation. In a subsequent overview report on DOE, we recommended that

eliminating self-regulation would, among other necessary actions, help improve the

accountability of the department.3

In its October 2001 report on energy and water development appropriations for fiscal

year 2002, the conference committee directed DOE to prepare an implementation

plan for transitioning to external regulation at the department’s 10 science

laboratories. For the purpose of preparing this plan, the conference report stated

that the department should assume that NRC would take over regulatory

responsibilities for nuclear safety and OSHA would take over regulatory

responsibilities for worker safety at these facilities. The plan was to address all

details necessary to implement external regulation, including

• estimates of additional resources NRC and OSHA would need,

• estimates of corresponding reductions in funding and staffing at the department,

• specific facilities or classes of facilities for which external regulation cannot be

implemented in a timely manner,

• necessary changes to existing management and operating contracts, and

• changes in statutory language necessary to effect the transition to external

regulation.4

The implementation plan was due to the House and Senate Appropriations

Committees by May 31, 2002. DOE has, however, not completed its plan by the date

of this report.

As part of an ongoing monitoring effort, you asked us to (1) identify current

stakeholder positions on external regulation of DOE’s science facilities, (2)

summarize the costs and benefits of using external agencies to regulate DOE nuclear

and worker safety, and (3) determine how comparable domestic and European

science facilities are regulated for nuclear and worker safety. We briefed your offices

on the results of our review on June 3, 2002, using the enclosed charts. This report

summarizes the results of that briefing.

To address these objectives, we asked DOE, NRC, OSHA, and the major science

laboratory contractors for their current position on external regulation. We obtained

cost and benefit information from these officials and visited major DOE science

laboratories. We also obtained pertinent information on domestic facilities similar to

DOE, but externally regulated, and comparable facilities in Belgium, the United

Kingdom, France, and Switzerland.

 3 U.S. General Accounting Office, Department of Energy: Fundamental Reassessment Needed to

Address Major Mission, Structure, and Accountability Problems, GAO-02-51, (Washington D.C. Dec.

21 2001).

4

 H.R. Rep. No. 107-258, Oct. 30, 2001, at 109-110.
Page 3 GAO–02-868R External Regulation of DOE

We did not verify the costs and benefits reported by these sources, but we did review

the reasonableness of their claims. We conducted our review from November 2001

through May 2002 in accordance with generally accepted government auditing

standards.

In summary:

The positions of DOE and its potential regulators—NRC and OSHA—are essentially

unchanged since the 1999 congressional hearing held on the results of simulated

inspections at several DOE facilities.5 DOE officials told us that (1) the department’s

current position on external regulation is “neutral” because the Secretary has

insufficient information on which to make a decision, (2) another study is needed to

develop data on the costs and benefits of making the transition to and operating

under external regulation, and (3) a realistic implementation plan cannot be

developed until the study is completed, which DOE estimates will take 6 to 9 months.

On the other hand, NRC and OSHA report that they are currently prepared to begin

regulating the department’s 10 science laboratories, given adequate resources to do

so. The two safety regulators are familiar with most of the facilities they would

regulate and are already regulating parts of DOE where the Congress has given them

specific authority. The laboratory contractors that we spoke with—representing

most of DOE’s science work—were unanimous in their support for external

regulation under certain conditions, primarily that DOE will reduce its current level

of nuclear and worker safety oversight once NRC and OSHA assume these

responsibilities.

Data from past regulatory simulations, and ongoing work by DOE, NRC and OSHA,

show that shifting to external regulation of science laboratories would not be

prohibitively expensive. For example, NRC’s and OSHA’s estimates to regulate the 10

science laboratories are potentially less than DOE expenditures to regulate itself in

terms of personnel costs. The cost of upgrading DOE facilities to regulator standards

is less certain, but may not be significant for a variety of reasons: (1) NRC concluded

from its simulations that few, if any, changes to DOE facilities are needed to meet

NRC’s licensing requirements; (2) NRC stated that it would be flexible in applying its

standards to DOE’s unique facilities without compromising safety; and (3) OSHA

concluded from its simulations that DOE deficiencies are similar to levels found in

the private-sector (DOE has adopted OSHA-like standards). DOE needs to make

several decisions that will affect costs, the most important of which is determining

what the role of its field staff will be under external regulation. These and other

decisions form the assumptions upon which an implementation plan must be based,

but have not been made.

The potential benefits of external regulation have been widely reported. A 1996 DOE

task force concluded that externally regulating DOE facilities would improve safety,

eliminate the inherent conflict of interest from self-regulation, achieve consistency

with current domestic and international safety management practices, and gain

 5 External Regulation of DOE Facilities: Pilot Project Results, Hearing before the Subcommittee on

Energy and Environment of the Committee on Science, House of Representatives, Serial No. 106-29,

July 22, 1999.
Page 4 GAO–02-868R External Regulation of DOE

credibility and public trust.6 Potential cost-saving benefits were also noted. For

example, the task found that seven large contractors regulated by NRC and OSHA

employed substantially fewer dedicated ES&H staffs than were found at DOE

facilities. More recently, DOE's major science laboratory contractors told us that

they could reduce their ES&H staff by up to 30 percent if DOE relinquished its

oversight to external regulators. DOE’s largest science contractor, Battelle Memorial

Institute,7

 reported that it spends one-half to one-third less (as a percent of total

costs) on ES&H in its externally regulated private sector laboratories.8

 DOE found

similar results in a recent study comparing the management of its Lawrence Berkeley

National Laboratory with two other federal agencies that use externally regulated

contractors to manage their laboratories—the National Atmospheric and Space

Administration’s (NASA) Jet Propulsion Laboratory and the National Science

Foundation’s (NSF) National Center for Atmospheric Research.9

 Contractors

operating these laboratories had a smaller ratio of ES&H staff to total workers than

exists in DOE’s Berkeley lab contractor. In addition, NASA and NSF were able to rely

on far fewer staff to oversee ES&H responsibilities at their laboratories. For

example, while there was only 1 ES&H person out of 23 NASA site office personnel at

its Jet Propulsion Laboratory, there were 5 dedicated ES&H personnel out of 15 at

DOE’s Berkeley site office.10 On average, we found that DOE dedicated about 30

percent of its site office staffs to ES&H oversight, not including technical staffs at the

operations offices and several offices at headquarters.

Experiences from foreign governments and their laboratories provide additional

evidence that external regulation is feasible and beneficial. The United Kingdom,

France, Switzerland, and Belgium all have science facilities operated by contractors

on behalf of sponsoring government agencies. These governments have long

traditions of using external regulators; essentially none of them self-regulate nuclear

and worker safety. All told us that external regulation is valuable and necessary to

ensure safety and public credibility. Two countries, the United Kingdom and France,

also use external regulators to oversee parts of their nuclear defense research and

development establishment. The United Kingdom, after transferring its two nuclear

defense research facilities to private sector contractors, shifted much of the oversight

of the facilities to external safety regulators within a 2-year period. United Kingdom

officials told us that the shift to external regulation not only increased safety and

improved public credibility but also provided greater freedom to voice worker safety

concerns.

 6

Report of Department of Energy Working Group on External Regulation, DOE/US-0001, December

1996, p.1-1.

7

 Battelle Memorial Institute is DOE’s management and operating contractor for the Pacific Northwest

National Laboratory, and manages Brookhaven National Laboratory (in partnership with the State

University of New York at Stonybrook), and for the Oak Ridge National Laboratory (in partnership

with the University of Tennessee).

8

 Battelle has also concluded that the aggregate hazards associated with the R&D activities at these

institutions cannot account for these cost differences.

9

DOE Best Practices Pilot Study, Berkeley Lab, LBNL/PUB-865, February 2002.

10 We were not able to disaggregate department staff overseeing environmental issues from those

involved in safety and health.
Page 5 GAO–02-868R External Regulation of DOE

Overall, growing evidence suggests that external regulators can potentially oversee

DOE science laboratories more effectively and at less cost than DOE’s internal

staff.We believe that their greater independence, coupled with use of national nuclear

and worker standards and enforcement powers, will also make them more effective

regulators. Ultimately, shifting to external regulation should allow DOE and its

contractors to potentially re-direct ES&H resources to other mission priorities. We

also believe that DOE has had ample time to develop an implementation plan to

externally regulate its 10 science laboratories.

_ _ _ _ _

We met with DOE officials and provided them with a draft of our briefing charts for

comment. The department offered several clarifying changes, which we have

incorporated as appropriate. DOE officials told us that the Secretary needs more

cost and other information before making a decision on external regulation and

completing an implementation plan.

As agreed with your offices, we will make copies of this report available to others

upon request. This letter will also be available at no charge on GAO’s Web site at

http://www.gao.gov.

If you have any questions or need additional information, please contact me at (202)-

512-3464 or Gary Boss, Assistant Director, at (202) 512-6964. Major contributors to

this letter include Charles Egan, Thomas Laetz, and Michael Sagalow.

(Ms.) Gary Jones

Director, Natural Resources

 and Environment

Enclosure
Page 6 GAO–02-868R External Regulation of DOE

Enclosure

BRIEFING PRESENTED ON JUNE 3, 2002

1

Observations on Using External Agencies to 

Regulate Nuclear and Worker Safety in DOE’s 

Science Laboratories

Prepared for the Subcommittee on Energy and Water 

Development, House Committee on Appropriations

June 3, 2002

2

GAO’s Objectives

Identify current stakeholder positions on external regulation of

DOE’s science facilities

Summ arize the costs and benefits of using external agencies 

to regulate DOE nuclear and worker safety 

Determ ine how com parable dom estic and European science 

facilities are regulated for nuclear and worker safety
Page 7 GAO–02-868R External Regulation of DOE

3

Scope and Methodology

For our review, we

• interviewed DOE, NRC and OSHA officials and

examined past studies;

• visited major DOE science laboratories (Lawrence

Berkeley, Stanford, Argonne, and Oak Ridge);

• obtained information on other domestic facilities; and

• visited comparable facilities in Belgium, the United

Kingdom, France and Switzerland, and interviewed

government agencies, contractors, and regulators.

We did not verify the costs and benefits reported by federal

agencies, contractors, or foreign officials we interviewed, but

we did review the reasonableness of their claims.

4

Background

DOE is the only federal agency whose facilities are essentially exempt 

from regulation by NRC for nuclear safety and OSHA for worker protection

History of DOE External Regulation Activities

1989: Significant workplace safety and health problems found in its 

facilities (Tiger Team reviews).

1992: OSHA and DOE formalize relationship for technical 

assistance and consultation.

1993: Energy Secretary announces intention to end DOE self-regulation 

of worker safety and health.

1994: Legislation proposed requiring NRC licensing of all new DOE 

nuclear facilities.

1995: DOE blue ribbon panel recommends, “essentially all aspects of 

safety at DOE nuclear facilities should be externally regulated.”

1996: DOE sets a 10-year timetable for ending self regulation.

1996: OSHA conducts simulated inspections at DOE’s Argonne Lab.
Page 8 GAO–02-868R External Regulation of DOE

5

Background

 1997: NRC and OSHA to conduct simulated inspections at several 

DOE facilities.

 1998: Appropriations conference report directs DOE to build new nondefense nuclear facilities (2000 and beyond) to NRC 

standards.

 1999: Energy Secretary decides to continue self-regulation, citing cost 

and regulatory uncertainties.

 2001: GAO recommends DOE end self-regulation to improve its 

accountability

6

Background

The 2001 Appropriations Conference Report directed DOE to 

prepare a plan to implement external regulation that

• includes only its 10 science laboratories (see appendix)--

defense facilities are excluded,

• addresses all details necessary to implement external 

regulation,

• estimates additional resources NRC and OSHA need 

and corresponding reductions in DOE staff, and

• identifies contractual and legislative changes needed to 

effect the transition to external regulation.

Plan was due May 31, 2002.
Page 9 GAO–02-868R External Regulation of DOE

7

DOE officials told us that their current position on external 

regulation is “neutral” because the Secretary has insufficient information with which to make a decision on external 

regulation; a 6 to 9 month study is planned to develop the 

cost and other information he needs.

DOE’s potential regulators--OSHA and NRC-- support new responsibilities, assuming resources are available and new 

authority is granted.

Contractor directors representing 6 of DOE’s 10 science 

laboratories (and nearly 90 percent of DOE’s 10-lab budget) told us they support external regulation if they hold the 

license and DOE substantially reduces its safety oversight 

(other directors were not contacted).

Stakeholder Positions

8

Stakeholder Positions

NRC and OSHA interact with DOE in several areas 

specifically authorized by the Congress, thus giving DOE 

valuable experience operating under external regulators. 

NRC:

• is participating in over 20 DOE sites and activities in 

which it licenses, certifies or consults. For example, NRC 

regulates the:

• high-level waste repository (Yucca Mountain),

• gaseous diffusion plants,

• uranium mill tailings sites,

• Independent Fuel Storage Facility at Fort St. Vrain, 

and

• West Valley Demonstration Project.

• participated in DOE studies of external regulation at 

several laboratories.
Page 10 GAO–02-868R External Regulation of DOE

9

Stakeholder Positions

OSHA:

• regulates non-Atomic Energy Act sites (e.g., power 

administrations, technology office, and petroleum 

reserves),

• regulates the gaseous diffusion plants leased by DOE 

to a private sector company, and

• participated in early DOE studies of external 

regulation and was part of the late 1980s DOE 

inspection teams (Tiger Teams).

NRC and OSHA, however, have no regulatory presence at 

the 10 science laboratories.

10

Cost Issues

External regulatory costs cannot be reasonably ascertained 

until DOE benchmarks its facilities against regulatory 

standards, decides on license holder, and defines its roles and 

responsibilities.

• Costs are dependent on the regulatory flexibility applied 

by NRC to DOE’s unique facilities. For example, NRC

• gives exemptions and waivers, as its did when it 

waived its seismic requirements at a DOE-licensed 

facility in Idaho, saving $7 million.

• reports it will waive it decommissioning and 

decontamination (D&D) requirements for DOE 

facilities.

• says that applying regulatory flexibility would not 

compromise safety.

• NRC simulated inspections found few facility changes 

needed to meet its standards.
Page 11 GAO–02-868R External Regulation of DOE

11

Cost Issues

OSHA simulated inspections identified a level of deficiencies 

only slightly above national averages.

OSHA noted that the cost of correcting “legacy” hazards (i.e., 

facilities that were built to older standards) is substantial, and 

needs to be addressed independent of external regulation 

decisions.

Continued substantial DOE oversight under external 

regulation would result in costly dual regulation.

12

Cost Issues

NRC estimates to regulate DOE’s 10 science laboratories 

Transition Period: 

• FY 2003 -- 42.1 FTEs, $6.8 million total costs

• FY 2004 – 41.0 FTEs, $6.4 million total costs

• Steady State or Annual: 22.1 FTEs, $4.5 million total costs

• Six Labs: Ames, Berkeley, Fermi, Thomas Jefferson, Princeton Plasma 

and Stanford require only one license for each site

• Transition per year -- 0.2 FTEs per site & $30 thousand travel

• Steady state per year -- 0.2 FTEs per site & $20 thousand travel 

• Oak Ridge (most complex): Requires three separate licenses 

• Transition per year -- 15 FTEs, $0.7 million in FY 2003 & $0.5 

million in FY 2004) 

• Steady state per year -- 5 FTEs annually, $0.1 million including a 

resident inspector.

• Incremental cost to include accelerators: 7.3 FTEs in FY 2003 ($1.4 

million), 5.8 FTEs in FY 2004 ($1.0 million), and 1.5 FTEs steady state 

($0.3 million)
Page 12 GAO–02-868R External Regulation of DOE

13

Cost Issues

KEY assumptions for NRC estimates

• All DOE facilities would be licensed in 2 years (ORNL a 

possible exception).

• Management and operating contractor is the licensee.

• NRC D&D requirements would be suspended.

• Estimates are based on experience in similar facilities, 

and pilot results.

• DOE facilities are generally in safe condition.

14

Cost Issues

OSHA estimates to regulate DOE’s 10 science laboratories 

(provided to DOE)

• Transition costs: $445,000 to create a special office to 

inspect DOE sites.

• Annual costs: $2.13 million and 19 FTEs.

• Other costs: $6.35 million to develop revised standards 

for ionizing radiation, spread over 5 years.

Key assumptions:

• Estimates are based, in part, on its OSHA simulated 

inspection of Argonne in 1997.

• OSHA would inspect DOE science laboratories in the 

same way it inspects any other facility.
Page 13 GAO–02-868R External Regulation of DOE

15

Benefits

DOE’s 1996 Working Group on External Regulation, which 

included DOE and other federal executives, said external 

regulation would:

• improve safety,

• eliminate the inherent conflict of interest from selfregulation,

• become more consistent with current domestic and 

international safety management practices, and

• gain credibility and public trust.

16

Benefits

Stronger NRC and OSHA enforcement powers should lead to 

improved safety culture (1999 hearings):

• NRC: “external oversight...provides an increased 

assurance of safety in the long run.”

• OSHA: “it appears that there is room for improvement in 

safety and health at DOE sites.”
Page 14 GAO–02-868R External Regulation of DOE

17

Other Potential Savings Could Offset Some Costs

• Reduction/redirection of DOE staff.

• DOE’s 2002 Best Practices study found that NASA 

and NSF required fewer resources than DOE to 

oversee their contractor-operated facilities.

• About 30 percent of staff at the 4 major site offices we 

visited are dedicated to ES&H oversight (excluding 

significant staff in operations and headquarter offices). 

Benefits

18

Benefits

• Reduction/redirection of contractor staff

• Lab directors representing DOE’s five multi-program 

science labs told us they could reduce or redirect their 

ES&H staff by up to 30 percent under external 

regulators (assuming DOE reduced its oversight).

• Battelle, manager of 3 of these science labs, told us 

that it spends one half to one third less (as a percent 

of total costs) on ES&H at its externally regulated 

private-sector labs.

• DOE’s 1996 report found that 7 large companies 

used from 47 to 92 percent fewer ES&H staff per 1000 

employees than DOE.
Page 15 GAO–02-868R External Regulation of DOE

19

Comparison of ES&H Staff across Three 

Government Laboratories

Source: DOE Best Practices Pilot Study (February, 2002)

Benefits

20

Comparison of ES&H Staff Across DOE &

Seven Private Sector Companies

Source: DOE Working Group on External Regulation (December, 1996)

Benefits
Page 16 GAO–02-868R External Regulation of DOE

22

Belgium, the United Kingdom, France, and Switzerland value 

the benefits of external regulation

• All research facilities have been licensed and inspected 

by independent regulators for some time--most are 

variations of government-owned and contractor-operated 

sites.

• Public concerns for nuclear safety and radiation 

exposure have been forces behind recent legislative 

changes to establish even more layers of independence.

Other Experiences

21

Benefits

• Contractors told us they can be more efficient:

• external regulators are more consistent and 

predictable than DOE, making planning easier 

and improving efficiency;

• reducing ES&H staff time could redirect 

scientists to mission work; and 

• working to NRC and OSHA standards allows 

consistency with other research facilities, 

making DOE labs more competitive and user 

friendly.
Page 17 GAO–02-868R External Regulation of DOE

23

Other Experiences

Foreign government funding agencies and laboratory 

contractors cite several benefits of external regulation:

• Increasing safety

• Improving credibility with the public

• Leveraging funds for infrastructure improvements

• Fostering more efficient organizations

24

The United Kingdom and France use external regulators to 

oversee safety in many defense facilities. 

• The United Kingdom has an independent external 

regulator for defense R&D facilities shared with the 

civilian side, but uses an internal regulator for warheads 

and naval nuclear propulsion.

• These facilities made the transition from internal to 

external regulation in just 2 years.

• Only minor facility upgrades were needed.

• France has an independent external regulator for 

defense R&D facilities, parallel to the civilian side, but 

shares a common technical advisory agency. 

Other Experiences
Page 18 GAO–02-868R External Regulation of DOE

(360238)

25

Observations

External regulation would help improve public confidence and credibility in 

DOE, enhance the safety culture in its facilities, and provide DOE and its 

contractors with an opportunity to redirect their resources to important 

mission work.

Growing evidence shows that external agencies could potentially regulate 

DOE more effectively and at less cost than DOE’s internal staff.

Experiences from research facilities in comparable domestic and European 

laboratories provide additional evidence that external regulation is feasible 

and has many benefits.

DOE has had ample time to develop an implementation plan to externally 

regulate its10 science labs. NRC and OSHA, as DOE potential external 

regulators, have provided DOE with the cost and implementation data 

necessary for developing a plan.

26

Appendix: DOE’s 10 Science Labs

Multi-program

1. Argonne National Laboratory-East, Argonne, IL (University of Chicago)

2. Brookhaven National 

Laboratory, Upton, NY (Brookhaven Science 

Associates)

3. Lawrence Berkeley National Laboratory, Berkeley, CA (University of 

California)

4. Oak Ridge National Laboratory, Oak Ridge, TN (UT-Battelle, LLC)

5. Pacific Northwest National 

Laboratory, Richland, WA 

(Battelle Memorial Institute)

Single-purpose

1. Ames Laboratory, Ames, IA 

(Iowa State University)

2. Fermi National Accelerator 

Laboratory, Batavia, IL 

(University Research 

Association)

3. Princeton Plasma Physics Laboratory, Princeton, NJ 

(Princeton University)

4. Stanford Linear Accelerator 

Center, Menlo Park, CA 

(Stanford University)

5. Thomas Jefferson National 

Accelerator Facility, Newport News, VA (Southeastern 

Universities Research 

Association)