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i 

22–454 2017

[H.A.S.C. No. 114–136] 

DEFERRED MAINTENANCE IN THE 

NUCLEAR SECURITY ENTERPRISE: 

SAFETY AND MISSION RISKS 

HEARING 

BEFORE THE

SUBCOMMITTEE ON STRATEGIC FORCES 

OF THE

COMMITTEE ON ARMED SERVICES 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED FOURTEENTH CONGRESS 

SECOND SESSION 

HEARING HELD 

SEPTEMBER 7, 2016 
(II) 

SUBCOMMITTEE ON STRATEGIC FORCES 

MIKE ROGERS, Alabama, Chairman 

TRENT FRANKS, Arizona 

DOUG LAMBORN, Colorado, Vice Chair 

MIKE COFFMAN, Colorado 

MO BROOKS, Alabama 

JIM BRIDENSTINE, Oklahoma 

J. RANDY FORBES, Virginia 

ROB BISHOP, Utah 

MICHAEL R. TURNER, Ohio 

JOHN FLEMING, Louisiana 

JIM COOPER, Tennessee 

LORETTA SANCHEZ, California 

RICK LARSEN, Washington 

JOHN GARAMENDI, California 

BRAD ASHFORD, Nebraska 

PETE AGUILAR, California 

(Vacancy) 

DREW WALTER, Professional Staff Member 

LEONOR TOMERO, Counsel 

MIKE GANCIO, Clerk 
(III) 

C O N T E N T S 

Page 

STATEMENTS PRESENTED BY MEMBERS OF CONGRESS 

Cooper, Hon. Jim, a Representative from Tennessee, Ranking Member, Subcommittee on Strategic Forces ............................................................................ 3 

Rogers, Hon. Mike, a Representative from Alabama, Chairman, Subcommittee 

on Strategic Forces ............................................................................................... 1 

WITNESSES 

Klotz, Lt Gen Frank G., USAF (Ret.), Administrator, National Nuclear Security Administration, accompanied by James McConnell, Associate Administrator for Safety, Infrastructure, and Operations, National Nuclear Security 

Administration ..................................................................................................... 16 

McMillan, Dr. Charles F., Laboratory Director, Los Alamos National Laboratory ........................................................................................................................ 5 

Ricciardelli, John, President, Honeywell Federal Manufacturing & Technologies, LLC ........................................................................................................ 6 

Smith, Morgan, President and Chief Executive Officer, Consolidated Nuclear 

Security, LLC ....................................................................................................... 4 

APPENDIX 

PREPARED STATEMENTS: 

Cooper, Hon. Jim .............................................................................................. 36 

Klotz, Lt Gen Frank G. .................................................................................... 67 

McMillan, Dr. Charles F. ................................................................................. 48 

Ricciardelli, John .............................................................................................. 59 

Rogers, Hon. Mike ............................................................................................ 33 

Smith, Morgan .................................................................................................. 37 

DOCUMENTS SUBMITTED FOR THE RECORD: 

NNSA slide displayed by Mr. Rogers .............................................................. 79 

Secretary of Energy letter to the Director of the Office of Management 

and Budget .................................................................................................... 80 

WITNESS RESPONSES TO QUESTIONS ASKED DURING THE HEARING: 

Mr. Cooper ........................................................................................................ 87 

Mr. Garamendi ................................................................................................. 87 

QUESTIONS SUBMITTED BY MEMBERS POST HEARING: 

Mr. Cooper ........................................................................................................ 104 

Mr. Larsen ........................................................................................................ 106 

Mr. Rogers ......................................................................................................... 91 

(1) 

DEFERRED MAINTENANCE IN THE NUCLEAR SECURITY 

ENTERPRISE: SAFETY AND MISSION RISKS 

HOUSE OF REPRESENTATIVES, COMMITTEE ON ARMED SERVICES, SUBCOMMITTEE ON STRATEGIC FORCES, Washington, DC, Wednesday, September 7, 2016. 

The subcommittee met, pursuant to call, at 3:29 p.m., in room 

2118, Rayburn House Office Building, Hon. Mike Rogers (chairman 

of the subcommittee) presiding. 

OPENING STATEMENT OF HON. MIKE ROGERS, A REPRESENTATIVE FROM ALABAMA, CHAIRMAN, SUBCOMMITTEE ON 

STRATEGIC FORCES 

Mr. ROGERS. I will call this hearing of the Strategic Forces Subcommittee of the House Armed Services Committee to order. And 

welcome all of our witnesses on this hearing titled ‘‘Deferred Maintenance in the Nuclear Security Enterprise: Safety and Mission 

Risks.’’ 

To kick off the hearing, I want to display a slide provided by 

NNSA [National Nuclear Security Administration] that encapsulates the challenges that we are dealing with here today. 

[The slide referred to can be found in the Appendix on page 79.] 

Mr. ROGERS. The enterprise has a $3.7 billion backlog of deferred 

maintenance it has accumulated over decades, and this backlog is 

now actively threatening both NNSA’s mission and the safety of its 

workers. As this slide puts it so well, quote, ‘‘Infrastructure risks 

become safety and program risks,’’ close quote. 

This slide also shows some very real impacts that infrastructure 

failures are having. Ranking Member Cooper and I have seen much 

of this firsthand during our oversight visits to these facilities. Just 

a small list of the challenges that we have seen include tarps hung 

over sensitive diagnostic equipment to prevent a leaking roof from 

destroying equipment worth tens of millions of dollars, chunks of 

concrete falling from ceilings into operational workspaces, tape and 

plastic sheeting around pipes carrying radioactive fluids, major hydraulic oil leaks, grass growing through floors. 

As this slide describes, many of these failures result directly in 

program delays and safety risks. Our witnesses highlight this in 

their written statements. For example, here in General Klotz’s 

statement, quote: ‘‘Our infrastructure is extensive, complex, and in 

many critical areas, several decades old. More than half of NNSA’s 

approximately 6,000 real property assets are over 40 years old, and 

nearly 30 percent date back to the Manhattan Project era. Many 

of the enterprise’s critical utility, safety, and support systems are 
2 

failing at an increasing and unpredictable rate, which poses both 

programmatic and safety risk,’’ close quote. 

And here is Mr. Smith, quote: ‘‘Many key facilities at both 

[Pantex and Y–12] were constructed in the 1940s and were intended to operate for as little as one decade. Many facilities and 

their supporting infrastructure have exceeded or far exceeded their 

expected life, and major systems within the facilities are beginning 

to fail,’’ close quote. 

And finally, Dr. McMillan, quote: ‘‘One of the things that keeps 

me up at night is the realization that essential capabilities are held 

at risk by the possibility of such failures; in many cases, our enterprise has a single point of failure,’’ close quote. 

Of course, these infrastructure challenges directly impact 

NNSA’s readiness to respond to new direction and military requirements. Broader defense readiness challenges have been a focus this 

year of the HASC [House Armed Services Committee], and readiness and responsiveness within NNSA has been a focus of this subcommittee for years. We must ensure not only that people and tools 

within the NNSA are ready to respond, but also infrastructure. 

On the readiness of people and tools front, this committee has 

continued to advocate the stockpile readiness program mandated 

by last year’s NDAA [National Defense Authorization Act]. On the 

infrastructure front, we continue to authorize substantial increases 

to NNSA’s infrastructure accounts. But I believe more must be 

done. We need to be looking to do more, including both tried and 

true solutions that have worked in the past as well as new innovative solutions. 

For instance, the Facilities and Infrastructure Recapitalization Program, or FIRP, was a 10-year, $2 billion effort that started in 

2002 and was successful in addressing many of the deferred maintenance challenges. But in the end, it accompanied only a portion 

of the work that ultimately needs to be done. I think we should be 

looking for a new FIRP-like program for the future. 

We should also recognize the success of recent public-private 

partnerships in addressing these challenges in innovative ways. 

The result out at Kansas City, in particular, is indicative of what 

we can do if we work together and use these kinds of creative approaches. 

I want to thank our witnesses for being here. You represent and 

lead many of the workers within our Nation’s nuclear enterprise. 

We know how hard they work and are grateful to all of you for 

your service to our country. 

Our first panel includes Dr. Charlie McMillan, laboratory director at Los Alamos National Lab; Mr. John Ricciardelli, president, 

Honeywell Federal Manufacturing & Technologies; Mr. Morgan 

Smith, president and CEO [chief executive officer] of Consolidated 

Nuclear Security. 

Following these gentlemen in our second panel of witnesses we 

will also have the Honorable Frank Klotz, Administrator of the 

NNSA, Mr. Jim McConnell, Associate Administrator for Safety, Infrastructure, and Operations, NNSA. 

My sources tell me that today it is General Klotz’s birthday, so 

happy birthday to General Klotz. I would sing to him, but that is 

pretty bad punishment, so I won’t do that. 
3 

Finally, I want to highlight the important work being done by 

the witnesses from both our panels. Under the leadership and direction of Secretary Moniz and General Klotz, you all have put a 

halt to the growth of deferred maintenance, and that is to be commended. 

You recognize that these challenges have a direct impact on your 

workers’ morale, performance, and safety, and I know you are 

working hard to deliver for all of them. The subcommittee stands 

by to assist and support you because we recognize how much more 

needs to be done. 

I now turn it over to my friend and colleague from Tennessee, 

the ranking member, for any opening statement he may have. Roll 

Tide. 

[The prepared statement of Mr. Rogers can be found in the Appendix on page 33.] 

STATEMENT OF HON. JIM COOPER, A REPRESENTATIVE FROM 

TENNESSEE, RANKING MEMBER, SUBCOMMITTEE ON STRATEGIC FORCES 

Mr. COOPER. I was hoping you would dispense without any football references, but there at the end you completely blew it. 

I too would like to welcome the witnesses, and I would like to 

ask unanimous consent that my statement be inserted for the 

record. 

Mr. ROGERS. Without objection. 

Mr. COOPER. I think the chairman has stated it very well, so I 

will not belabor the point. We need to get adequate maintenance 

to all these facilities. It is my impression that Naval Reactors on 

the whole has done a better job than NNSA. I am not faulting Admiral Klotz because I think he and Secretary Moniz are part of the 

solution, not part of the problem, but it is going to take many years 

of sustained effort to solve this problem. 

I thank the witnesses. I look forward to your testimony. 

[The prepared statement of Mr. Cooper can be found in the Appendix on page 36.] 

Mr. ROGERS. I thank the gentleman. 

Also, we are going to be interrupted for votes during this hearing. So what I would ask is that—your entire statement is going 

to be submitted for the record—if you could just take 3 minutes instead of 5 to summarize, so we could try to get both panels done 

without delaying everybody. But we will, without objection, accept 

all of your full statements into the record. 

I also want to point out that during your testimony when you are 

making your summary, we are going to be putting up slides to kind 

of complement what you are talking about, slides that you all have 

provided about your testimony. You don’t have to feel the need to 

narrate the slides. It is just something we are going to be doing 

concurrent with your comments. 

[The slides referred to are retained in the subcommittee files and 

can be viewed upon request.] 

Mr. ROGERS. And with that, we will go to the first panelist. Mr. 

Smith, you are recognized for 3 minutes. 
4 

STATEMENT OF MORGAN SMITH, PRESIDENT AND CHIEF EXECUTIVE OFFICER, CONSOLIDATED NUCLEAR SECURITY, 

LLC 

Mr. SMITH. Chairman Rogers, Ranking Member Cooper, members of the subcommittee, thank you for the opportunity to talk 

with you today about the deferred maintenance challenge facing 

both the National Nuclear Security Administration and, more importantly in my case, the plants that I represent, the Pantex Plant 

and Y–12. 

I appreciate the support of the committee and the support of 

Congress over the years of our sites and really appreciate the attention you are bringing to this very, very important matter. The 

quiet but important work that we do at our sites is essential to our 

Nation and our allies. For me, it is a privilege to work alongside 

the Federal and contractor patriots that do this work in support of 

our important mission. However, our facilities have not been immune from the progress of time and the effects of that time, similar 

to other infrastructure in the country. 

Sustaining the facilities while continuing to achieve our mission 

is a considerable challenge. Attracting and retaining a world-class 

workforce is also a challenge. The Nation ultimately would benefit 

from a better long-term approach. 

Between Pantex and Y–12, we have approximately $800 million 

in deferred maintenance currently in our books. Approximately 

$175 million of that is associated with critical facilities. At today’s 

level of funding, we will not be able to make a substantial reduction in that backlog of deferred maintenance, and the pictures that 

we are seeing are but the tip of the iceberg relative to what we 

face. 

One of the pictures you see is a ceiling deterioration that occurred from operations above it. It caused concrete to fall. Obviously, in that situation, it leads to both operational and personnel 

concerns. We have been able to repair the condition relative to the 

ceiling itself; however, we remain very limited and restricted in our 

operation of that equipment above that ceiling. 

While we will not compromise on safety and security, the backlog 

and deterioration that we are seeing does require us to deal almost 

daily with potential disruptions to our mission delivery. 

However, we do not sit idly by allowing obsolescence to occur 

with our systems. Along with eliminating excess and deteriorating 

facilities, we are embarking on the largest set of capital construction projects that we have had for both sites in decades. We also 

use public-private partnerships as we have opportunities such as 

recently occurred with the administrative support complex of 

Pantex. And then finally, we are our preserving our currently operated facilities through innovative approaches and new technologies. 

In conclusion, I believe our overall future approach must continue to, number one, provide for a robust recapitalization program; 

number two, pursue aggressive disposition of our excess facilities; 

and number three, reduce deferred maintenance issues through additional funding approaches. Each are essential to preserve the 

mission work that occurs at both sites; they are essential to ensure 

the safety of our workforce; and they are essential to help keep 
5 

Pantex and Y–12 on track to provide a safe, secure, and effective 

nuclear deterrent for the Nation. 

Again, thank you for the opportunity to speak with you today. 

[The prepared statement of Mr. Smith can be found in the Appendix on page 37.] 

Mr. ROGERS. Thank you, Mr. Smith. 

Dr. McMillan is recognized for 3 minutes. 

STATEMENT OF DR. CHARLES F. McMILLAN, LABORATORY 

DIRECTOR, LOS ALAMOS NATIONAL LABORATORY 

Dr. MCMILLAN. Chairman Rogers, Ranking Member Cooper, 

members of the committee, thank you for the invitation. I am Dr. 

Charlie McMillan. I am the director of the Los Alamos National 

Laboratory. 

We have recently marked the 20th anniversary of the Stockpile 

Stewardship Program. This program has allowed the National Nuclear Security Administration’s laboratories to certify this Nation’s 

nuclear deterrent that it is safe, secure, and effective. 

Our stewardship efforts would not have been possible without 

the strong support for significant investments in infrastructure 

from this subcommittee, Congress, and many administrations. 

Stockpile stewardship required the construction of new supercomputers, new experimental facilities, and these have helped the 

United States assure our allies and deter our adversaries. 

However, key elements of today’s nuclear weapons infrastructure 

were designed and constructed during the Cold War. Because it is 

more difficult today to bring new facilities online, we must continue 

to operate existing facilities longer than we had anticipated when 

they were originally built. And we have to do that and ensure that 

we do not place our workers, the public, or our mission at unacceptable risks. 

Just last week, I was discussing these issues with my colleagues 

at Sandia and at Livermore, and we all shared the concern that 

some of our critical facilities are being run to failure. Because infrastructure funding is a finite resource, I believe that upgrades for 

replacement activities have to be taken with a very sharp focus on 

the economics. 

To this end, staff at Los Alamos, working with our NNSA partners, have developed a modular strategy for bringing new infrastructure online. We believe that this will help both with the economics as well as with timely delivery when facilities are needed. 

These types of facilities, together with those associated with 

things like high-performance computing, our uranium facilities, 

and experimental facilities are all facilities that warrant and merit 

the greatest congressional focus. 

In your invitation, Mr. Chairman, you ask about things we might 

do to improve infrastructure. There are three things I would like 

to highlight for you. 

First of all, there is a category referred to as general plant 

projects. These allow us to use relatively small amounts of money 

focused locally to be able to address issues. 

I would highlight for you that at Los Alamos today we have trailers that were put into service 30 years ago. And in some of those 
6 

trailers we have problems with ceilings, water damage, falling in, 

we have problems with rodents in them. They need to be replaced. 

Over the last 10 years, we have been able to cut the number in 

half. We still have a long way to go. General plant projects let us 

do this. And I would recommend to you considering to index that 

money. It was last changed in 2009. 

Second, third-party financing. You mentioned that in your opening remarks. This is particularly important for my colleagues at 

Livermore and Sandia. 

Finally, innovative public-private partnerships. Today at Los Alamos we are working closely with our NNSA field office to be able 

to bring some of these projects online. We would like to be able to 

do that. 

Thank you for the invitation to speak today. 

[The prepared statement of Dr. McMillan can be found in the Appendix on page 48.] 

Mr. ROGERS. Thank you, Dr. McMillan. 

We have been called for votes. We have 7 minutes to get across 

the street. So we are going to suspend the hearing while we go and 

vote. We should be back in almost exactly 60 minutes. So I apologize for the inconvenience, but they don’t ask me when to call us 

for votes. 

With that, we will recess briefly. 

[Recess.] 

Mr. ROGERS. I call this hearing back to order. 

Mr. Ricciardelli, I know you have been anxiously anticipating 

this. The floor is yours. 

STATEMENT OF JOHN RICCIARDELLI, PRESIDENT, HONEYWELL FEDERAL MANUFACTURING & TECHNOLOGIES, LLC 

Mr. RICCIARDELLI. Thank you, Chairman Rogers, Ranking Member Cooper, and members of the subcommittee, for inviting me to 

testify before you today. I am John Ricciardelli, and I am the president of Honeywell’s Federal Manufacturing & Technologies, which 

has a proud history of serving as the prime contractor to the Department of Energy’s Kansas City National Security Campus 

[KCNSC] for nearly 70 years. 

The KCNSC is a 1.5 million square foot multimission engineering and manufacturing facility that supports the NNSA’s national 

security mission. Our primary focus is modernization of the Nation’s nuclear stockpile using the latest technologies to deliver a 

safe, secure, and reliable nuclear deterrent. 

It is an exciting and challenging time in the nuclear security 

enterprise with several life extension programs being addressed 

through their development phases simultaneously. Our facility is 

witnessing growth this year to support these important objectives. 

And while it is an exciting time at the KCNSC, we have had 

similar challenges to my colleagues next to me. About 10 years ago, 

we were faced with increasing pressure on defense budgets and 

growing deferred maintenance costs at Kansas City’s aging facility. 

Honeywell was challenged to help the Federal Government continue its mission in the most cost-effective way possible. 

The aging infrastructure at the Bannister location made installation of modern equipment difficult, expensive, and hazardous to the 
7 

mission as well as the personnel. Further, significant time and 

money was being spent on emergency repairs and facility upgrades 

for the emerging programs. 

Honeywell implemented a responsive infrastructure strategy to 

address these challenges. As a result, we now have a newly constructed state-of-the-art facility that features a flexible manufacturing design and 50 percent lower energy consumption, and we 

are also delivering over $150 million of savings to the taxpayers 

annually. 

Today, we are more agile in adapting to changing mission requirements. We are better positioned to recruit and retain the next 

generation of scientists and engineers. Safety hazards have been 

greatly reduced at the new facility as well, as evidenced by our 

safety performance. And, in fact, we just celebrated 3 million hours 

without a lost-time injury. 

The new campus utilized a third-party lease agreement for several reasons. The annual lease costs of the new facility were much 

more economical than the annual maintenance costs of the old 

building. A private developer was used and was able to build it 

more efficiently, assemble tax credits and financing. And finally, 

the campus can be used for other purpose if the government no 

longer needs it or if the government can buy it at any point for fair 

market value. 

While Honeywell used commercial best practices to deliver on the 

responsive infrastructure strategy, I would also like to elaborate on 

the importance of contractor oversight reform and how that has 

played an important role in the successful operation. 

Today, Honeywell and NNSA created the Kansas City Governance Model, a revolutionary reform of government oversight that 

reorients how Americans see performance in the government. The 

shift overall reduces costs without sacrificing public trust and utilizes a simpler governance model that capitalizes on private sector 

enterprise. 

To apply this model at other sites, the NNSA’s operating partners must do what Honeywell does daily: focus on getting results 

in a sustainable way while eliminating costs. We are committed to 

assisting the transformation through ongoing collaboration and 

best-practice sharing with our NNSA site partners. 

However, our work is not done yet. NNSA continues its effort to 

ensure that the old Bannister property be redeveloped in an efficient, safe, and environmentally responsible manner and not be left 

as a blight on the community. By funding the transfer of the Bannister facility in fiscal year 2017, the government will eliminate 

most of the future environmental liabilities through third-party 

demolition and remediation and could save approximately $650 

million. 

So once again, thank you, Mr. Chairman, for allowing me to address this committee. We are all connected through a shared goal 

of keeping our great Nation safe and secure. 

[The prepared statement of Mr. Ricciardelli can be found in the 

Appendix on page 59.] 

Mr. ROGERS. Thank you. And I thank all the witnesses for their 

opening statements. I know it takes a lot of time to prepare for 

this, and I appreciate that. 
8 

I will start off by recognizing myself for questions. 

You all heard my opening statement and some of the things, the 

infrastructure challenges that I described throughout your facilities. Ranking Member Cooper and I, as you know, have visited several of these facilities and seen some pretty shocking examples of 

the problems that you face in these very highly secure facilities. 

But I would like for each of you, if you could, to take a moment 

and describe for me in detail some of the infrastructure failures 

that you have seen and the consequences they have for your facility. 

We will start with you, Mr. Smith. 

Mr. SMITH. One of the pictures that you had up that I noted in 

my opening remarks was the ceiling failure that occurred as a result of Kathene leakage from Kathabars above, which the impact 

of that is the Kathene eats away the reinforcing bars, which greatly weakens the floor. 

At this point, we can only allow two people into that area where 

you have tons and tons of equipment at a time to do any work, and 

it is just a systematic failure. But when that equipment goes down, 

we have no ability then to go process the materials in that particular facility because that facility requires a very, very dry environment to safely and appropriately process the materials. 

So that is one example. Another example on the same site, I was 

at work not more than about a month ago on a Sunday morning, 

and I had just left to go to church with the intent to come back 

when I received a page that one of my utility workers, doing a 

rather routine task over a pit—and this pit was basically grating 

over top of it with end supports on each end and a center beam in 

the middle, and as she was doing that work, the structural steel 

holding up the grating on one end failed. And as you can imagine, 

you are on the wrong end of the seesaw at that point and you go 

down. 

In that case, fortunately, she sustained only a very minor injury, 

which I think was a grace-of-God moment in that case, but a very 

real facility issue with a person just doing a routine job. 

I had another one of those a couple months before that where a 

forklift drove onto what looked to be a pad. It was actually an extension of a basement. The structural steel in that area due to environmental attack over the years, salt and so forth that you use 

for the weather conditions, had led to that structural steel failing 

to the point where we had a collapse and a buckling of the concrete 

or a depression in the concrete and a failure of the structure, but 

not something that led to an injury as well. 

At Pantex, we deal with fire lead-ins to our bays and cells. We 

are on a major replacement program that will take another 10 

years. But when they fail, and they fail without warning, you can 

lose bays or cells. We recently had one where we lost a number of 

bays and cells and the ability to use it until we can go in and do 

the repair. And that just leads to an inherent unreliable condition 

and set of services. 

And I can probably go on, but that is probably sufficient. Give 

others time to comment. 

Mr. ROGERS. Yes. 

Dr. McMillan. 
9 

Dr. MCMILLAN. Mr. Chairman, let me just give you an example 

from last weekend. We had the air conditioning system in one of 

our vaults for one of our classified computers fail, and when that 

went down it took down the computing equipment that is needed 

to support our experimental work. That is a recent example. 

Let me say a few things about things we are acting on, but they 

illustrate the problem. Both we and our colleagues at Lawrence 

Livermore Laboratory are replacing major parts of our electrical infrastructure. Same kind of problem. If we have electrical failures, 

our computers go down, the work that we do to support the stockpile we can’t do. Our accelerators go down if we don’t have power. 

Third area, again, that we are taking action on, but it is overdue: 

The steam plant for the laboratory is finally on the verge of replacement, good public-private partnership on that one. But if we 

lose our heating systems in the wintertime, it is cold in Los Alamos. And sensitive scientific equipment does not do well when it 

freezes, nor do our buildings. 

And so those are the kinds of things that they are very fundamental infrastructure issues, they don’t have high profile, but if we 

don’t take care of those kinds of really basic things, we are not 

going to be able to serve the mission. And it affects, as my colleague said, not only the mission but also the safety of the people. 

I would offer as a final comment, when I talk to my craft people, 

the folks who have their hands on things like our electrical and our 

plumbing systems, one of the problems that they are dealing with 

day in and day out is how old these systems are. So if they were 

working on a modern strip mall, things would be uniform. When 

they go into one of my switch gears, they are dealing with stuff 

that was built in 1960, and they have to figure out how to make 

it work. And not only is that a maintenance problem, it is a safety 

problem. 

Thank you. 

Mr. ROGERS. Mr. Ricciardelli. 

Mr. RICCIARDELLI. We are lucky because in the new facility, obviously, we don’t have the same issues as my colleagues. But as you 

saw from the pictures, the Bannister facility, which we are still 

maintaining, even to this day, has about 45 people there that are 

just maintaining the HVAC [heating, ventilation, and air conditioning] system, the electrical systems, all of the infrastructure 

that still has to be kept up. 

And you can imagine back many years ago with that kind of 

aging system, with 6,000 people working that facility, how hazardous it was at that point. 

So with the new facility, we actually have 10 percent of our lease 

goes into maintaining the facility, and that will ensure that deferred maintenance will never be a problem. But, again, once we 

get the funding we can get rid of the Bannister and take care of 

a lot of that issue that we are still dealing with even to this day. 

Mr. ROGERS. Okay. You all heard me make reference to the fact that there is across the NNSA $3.7 billion in deferred maintenance. 

Let me ask this question. At the pace that you have been addressing deferred maintenance—and this will be really for Mr. Smith 

and Dr. McMillan—at the pace you have been addressing deferred 

maintenance over the last 5 years, when will you ever or will you 
10 

ever be able to catch up and have completed the deferred maintenance obligation that you have before you? 

Mr. Smith. 

Mr. SMITH. Mr. Chairman, we have had success in reducing it 

over time. I believe that there are several points that need to be 

taken into consideration when you answer that question. One is we 

have to continue to retire the old facilities and tear them down. 

That is one of the ways that we reduce the deferred maintenance. 

The next is continue to find innovative ways to do it, use tools like 

BUILDER. 

But in the end I would say, absent additional funding and given 

the trajectory we are on, we will never reduce it to zero, as you 

would envision it, because some of these systems just have to be 

replaced in the end. 

Mr. ROGERS. Dr. McMillan. 

Dr. MCMILLAN. Mr. Chairman, as I look at the list that we have 

at Los Alamos, there are a couple of things I would note. One, we 

have been working very closely with the NNSA to better estimate 

what the numbers are. And I think within a year or so we will be 

in a better position to give you updated numbers. And I look forward to what Frank Klotz has to say on that, because I know he 

is very aware of the work we are doing. 

As I look at the list at Los Alamos, there are several big items 

that when we are able to actually take them off the list, as my colleague said, they will make substantial reductions. A good example 

of that is the chemistry and material research facility. When we 

are finally able to retire that system and then take the building 

completely down, that will take down a big chunk. Similarly, I 

mentioned earlier our steam plant, another big chunk when we can 

get that done. 

And for most of the work that we have, we have plans in place 

and we are off working on those plans. My estimate is that it is 

roughly a decade of work to work that off, assuming, of course, we 

continue to get stable funding and we are able to spend it. So it 

is on the order of a decade. 

Mr. ROGERS. At the clip that you have been addressing this issue 

you think in a decade you will have addressed all the issues that 

are on your current list. What about the issues that are arising 

over the next decade? 

Dr. MCMILLAN. That depends again on funding, Mr. Chairman. 

Mr. ROGERS. That is the whole point. My argument is this: You 

are never going to resolve these deferred maintenance issues at the 

pace we have been addressing them. That is how we got this $3.7 

billion backlog. It is not going to happen. You are being overly optimistic if you think that we are going to be able to address this. 

I understand it is your job to be optimistic. It is my job to be realistic. And I am very frustrated. And this is the Congress’ fault, 

not yours, that the Congress has not more aggressively tried to get 

ahead of these maintenance issues. 

Dr. MCMILLAN. Well, and if I could look backwards, something 

that has helped over the last decade was the Facility and Infrastructure Recapitalization Program, what is called FIRP, and you 

mentioned that in your opening remarks. The big deal with that 

was that it put new dollars on the table. 
11 

† The specific fluid is Kathene, not caffeine. 

Mr. ROGERS. Right. 

Dr. MCMILLAN. It was new dollars coming into the laboratories 

and across the whole system. And as those dollars came in, we 

were able to prioritize them, we worked at a national level to do 

those priorities, and that made a difference. When the FIRP dollars 

went up, the deferred maintenance came down. 

Mr. ROGERS. So those are gone? 

Dr. MCMILLAN. Yeah, they are gone, but there is no magic in 

this. It is dollars. 

Mr. ROGERS. I completely agree. 

With that, I yield to the ranking member for any questions he 

may have. 

Mr. COOPER. Thank you, Mr. Chairman. 

Mr. Smith, did I hear in your testimony the word ‘‘caffeine’’ when 

you talked about the collapsed roof? 

Mr. SMITH. Yes, sir. 

Mr. COOPER. So caffeine from above dripped down and weakened 

the structural steel and the concrete? 

Mr. SMITH. Yes, sir. 

Mr. COOPER. Whence did this caffeine come? 

Mr. SMITH. It comes out of the Kathabar system. It is a dehumidification system that is used to treat and control the atmosphere 

in that particular facility. And over the years, leakage occurred, 

various conditions set that up. This goes back quite a period of 

time ago. 

Mr. COOPER. So this isn’t caffeine like coffee? 

Mr. SMITH. No, sir. It is a specific fluid used for purposes of dehumidification.† 

Mr. COOPER. Presumably, massive amounts of caffeine? 

Mr. SMITH. Yes, there are big units. 

Mr. COOPER. Was this leak of industrial caffeine not detected? 

Mr. SMITH. I honestly could not tell you exactly what happened 

years and years ago when it occurred. I really don’t have that history. I just know the consequence of what happened. 

Mr. COOPER. Second type of question, and it may be for Mr. 

Ricciardelli more than for anyone else. You mentioned in the lease 

agreement a 10 percent set-aside for future maintenance. I am almost wondering if it is budgeting malpractice in Congress if for any 

new project we do not set aside funding for future maintenance, because everything has to be maintained. And if we have funding for 

capital projects without that future maintenance, then we are 

blinding ourselves to the obvious. 

Mr. RICCIARDELLI. It is one of the benefits of the private-public 

agreement that we have in there. Not only did we reduce the cost 

of operation from $120 million a year down to $60 million a year, 

we got rid of $238 million worth of deferred maintenance that was 

left at the Bannister plant. And, in fact, all the maintenance is now 

done by the developer, and they set aside 10 percent of our lease 

payment to make sure that over the 20 years that they continue 

to maintain the facility at the current conditions. 

Mr. COOPER. I know that is specific to your lease agreement, but 

in any budget, you could set aside money. I think sometimes it is 
12 

called a sinking fund or amortization. There are various ways of 

describing it. But when we just appropriate money for a project 

and think that is it, we are generally leery of cost overruns and 

construction of the project, but we have given little thought to the 

maintenance needs that are likely to happen, in fact, inevitably 

going to happen in the future. 

Right now, we are repairing the Capitol dome for the third or 

fourth time in American history, and we will probably need to do 

that again in the next 30 or 40 years. It is just one of those inevitable things. 

Mr. RICCIARDELLI. And I think if you use good project management, planning the move from the old facility to the new facility 

will demonstrate that you could actually do it ahead of schedule 

and under cost. We did it for about $18 million less than we 

thought we would spend. And, again, that could be used for some 

of that deferment or for the maintenance in the future as well. 

Mr. COOPER. Mr. Smith and I were just in Oak Ridge for the uranium processing facility, one of the early steps there, a $6 billion 

facility. So have we set aside money for the maintenance of that? 

Mr. SMITH. At this point, I am unaware that we have, sir. But 

I need to take that as a takeaway and go do some reflection on 

that. 

[The information referred to can be found in the Appendix on 

page 87.] 

Mr. COOPER. Might be a good idea, at least for your successor’s 

successor’s successors. 

Mr. SMITH. Yes, sir. 

Mr. COOPER. Thank you, Mr. Chairman. 

Mr. ROGERS. I thank the gentleman. Don’t you find it interesting 

that in the public-private partnerships we require them to set aside 

money for deferred maintenance but yet we don’t do it in our own 

budgeted project items? You are right, it is malfeasance. 

Mr. COOPER. Hello—— 

Mr. ROGERS. The gentleman from California, Mr. Garamendi, is 

recognized for 5 minutes. 

Mr. GARAMENDI. Thank you. I am trying to catch up. My apologies for not being here earlier today. I am missing some of the 

opening statements, so I will try to play catch-up here. 

It appears as though we are looking at specific facilities on these 

campuses. And I am curious what the overall program is for the 

totality of the campus. I noticed that there are certain buildings 

that have been replaced, the Kansas City facility, for example, 

some public-private partnerships at Y–12, all of which seem to 

work good. I am familiar with some of the things that have gone 

on at Livermore. 

Do we have an overall plan on what needs to be done in the various facilities? The chemistry building at Los Alamos, obviously, in 

play here, but there is also the plutonium facility and the like. Yes, 

we know there is a problem. We can look at pictures as well as 

anybody else. But what is the overall program. Let’s just take Los 

Alamos, since you happen to be here, Dr. McMillan, and share with 

me and the rest of us what needs to be done in the various facilities and then the associated cost. 
13 

Dr. MCMILLAN. So, yes, we have a 10-year site plan that we look 

across all of the facilities on the site, not just individual ones, as 

you have rightly recognized, Congressman. Let me talk a little bit 

about some of the things that emerged from that plan that I think 

can help address your question. 

As I mentioned in my testimony, we are hiring approximately a 

third of our 10,000-person workforce over the next 5 years. A consequence of that is that we need space for uncleared employees 

first. And then as they get their clearances, which is a time-consuming process right now, we need space to be able to convert that 

space into cleared space so that they can do classified work in that 

space. 

So in our 5-year site plan, we have taken that kind of progression into account to ensure that we will be able to have the people 

that the Nation needs, and that as they are cleared, they have 

spaces to work in. 

As we look at our oldest facilities, we are using our overhead 

money to retire some of the oldest facilities. And then what we are 

often doing is taking shells—so the concrete is still in pretty good 

shape for many of our buildings—and then we are putting in new 

air conditioning systems, new plumbing systems, new air handling 

systems for being able to do light lab space. 

So we are trying to do things as efficiently as we can to provide 

the space for our workers. But we have a 10-year site plan and 

then we work down that plan. 

Mr. GARAMENDI. I assume you have made that information available to this committee? 

Dr. MCMILLAN. We have made it available to NNSA. We can certainly make it available to the committee if you would like to see 

it, yes. 

Mr. GARAMENDI. Yeah. I, for one, would like to see the overall 

plan that you have. 

[The information referred to can be found in the Appendix on 

page 87.] 

Mr. GARAMENDI. You did raise an interesting question—I assume 

there is a very good answer to it—and that is the—actually, you 

seem to be having to double the space as new people come in and 

then clearance? 

Dr. MCMILLAN. No. 

Mr. GARAMENDI. Did I misunderstand you? 

Dr. MCMILLAN. No, we aren’t doubling the space. We need space 

that is initially available for people without clearances. 

Mr. GARAMENDI. So that is separate from the—— 

Dr. MCMILLAN. From the cleared space, but that we can then 

convert into cleared space so that we will be able to have them— 

we are not doubling the space, absolutely not. We can’t afford to. 

Mr. GARAMENDI. That caught my attention. 

Dr. MCMILLAN. Yeah, no, we can’t afford to. 

Mr. GARAMENDI. So you recycle it and use it as secured space 

later. 

Dr. MCMILLAN. Absolutely. And then we can convert it into secured space. Because, no, we can’t afford to double space. There is 

no way. 

Mr. GARAMENDI. That is, I am sure, true. 
14 

You know that I have got problems with this, the size of the plutonium facility, and that is another question. I know that there was 

some question about whether it really needs to be rebuilt or not, 

whether you can repurpose it, as you just described, with those 

other facilities that have good concrete. And so I would like to see 

more detail about that. 

The other question, and this goes to Mr. Ricciardelli. You talked 

about the reduction in operating cost. Could you describe why that 

happened? 

Mr. RICCIARDELLI. So our operating cost in an old facility at Bannister, just keeping ahead of operations, was about $120 million a 

year. Through the private-public relationship with the developer, 

we basically built a $653 million facility, and we agreed to a lease 

rate of $60 million a year for 20 years. 

Mr. GARAMENDI. And they are responsible for the maintenance 

and upkeep during that 20-year period? 

Mr. RICCIARDELLI. They are responsible for all of the maintenance. The only thing that we maintain in the building is the capital equipment. But all the facilities, all the infrastructure, the 

parking lots, the landscaping, everything is done by the developer. 

Mr. GARAMENDI. That is another question—I have got 10 seconds. No, I have no seconds. 

I yield back. Thank you. 

Mr. ROGERS. I wanted to follow up with Mr. Ricciardelli and Mr. 

Smith. 

At both your sites you have had successful public-private partnerships to deal with some of your infrastructure challenges. Can 

you tell us a little bit about why those were successful and just describe what else you think we could use that model to address? 

I will start with you, Mr. Smith. 

Mr. SMITH. I believe they have been successful because it is an 

opportunity to essentially gain access to a significantly sized facility that enables us to house our workers and accomplish the mission in space that, again, will be maintained through that lease arrangement so it does not deplete your resources on the site and it 

enables you to get out of much older facilities that have legacydeferred maintenance issues on it. And thus far, we have been able 

to find developers who are very interested in doing it. They like 

working with our sites, and they give us very favorable rates for 

those leases. 

Mr. ROGERS. Is there another infrastructure challenge that you 

face that you think that would be a good model for us to use to address it? 

Mr. SMITH. There are a number of areas that we need to look at. 

One of the alternatives being looked at for a new lithium facility 

would be a public-private partnership. That would impact Y–12. 

You need to find facilities that you could repurpose as the lessor 

someday to other use. Engineering development could be an aspect 

of that. Warehousing can be an aspect of that. There may be a 

number of things. It somewhat depends on where you need be relative to the security fence as well. 

Mr. ROGERS. Okay. 

Mr. Ricciardelli. 
15 

Mr. RICCIARDELLI. Yes, sir. I think the private developer has the 

ability to bring in the funds that the government doesn’t have access to. So in our case, they went through private bond financing, 

they got local tax incentives from the municipal areas as well. And 

they were able to get money to fund these programs. And again 

over 20 years it will be a profitable program for them and they 

were willing to invest in that. 

I think in order to replicate it, to your point, we are going to 

probably have to look at some of the rules that limits the amount 

of private building on public lands, because in order to recapitalize 

it, in our case it is on public land, private land, and they can take 

it over if we decide to vacate it and turn it into an engineering or 

a manufacturing source. 

So I think in order to replicate it at some of the sites that are 

owned by the government, we may have to look at some of the 

rules that limit the ability to bring in private developers. 

Mr. ROGERS. Lastly, Dr. McMillan, I know you have talked about 

the—not today, but previously—your challenges in replacing your 

workforce, and it has been a monumental effort as baby boomers 

start to retire. Talk a little bit about the impact of these infrastructure challenges on the people you are trying to recruit into your 

workforce and the kind of people you are having to compete with, 

briefly. 

Dr. MCMILLAN. Yeah. Thank you, Mr. Chairman. 

As I mentioned in my oral testimony, we are hiring approximately a third of the laboratory. 

Mr. ROGERS. Which is how many people? 

Dr. MCMILLAN. It will be about 3,000 people. The total laboratory today there are about 10,000 people at work today. And we are 

having to put many of those people into what is unquestionably 

substandard space. I mentioned problems with ceilings. We have 

had ceilings fall in in some of our trailers. Fortunately, no safety 

problems. We take care of that. 

Mr. ROGERS. What kind of candidates are we talking about? 

Dr. MCMILLAN. We are talking about Ph.D.s, Mr. Chairman. 

Ph.D.s, master’s students. 

Mr. ROGERS. Engineering? 

Dr. MCMILLAN. These are people in physics, engineering, chemistry, hard sciences. 

Mr. ROGERS. What is the reaction you get when you bring those 

people in and show them where they will be working? 

Dr. MCMILLAN. I have had some of them to my house for dinner, 

and they are appalled. When their comparison is what is happening in Silicon Valley, we aren’t even in the same league. Now, 

maybe we shouldn’t be in the same league with Silicon Valley, but 

at least it ought to be a safe and—let me say it this way: We are 

hiring the next generation of the stewards of the stockpile today. 

That is what we are doing. We need space that is worthy of their 

service to the country. 

Mr. ROGERS. Well, and we need them to be able to come and 

work for us. That is my concern, is that if you bring in these people 

who have a lot of options, they are well educated and in highdemand careers, I think it demonstrates we don’t value them, their 
16 

work, if we are going to put them in a building that has got grass 

growing through the cement floor. 

Dr. MCMILLAN. That is right. It needs to be worthy of their service to the country. 

Mr. ROGERS. Yeah. 

With that, I yield to the ranking member for any additional questions he may have. 

Mr. COOPER. I have no more questions, Mr. Chairman. 

Mr. ROGERS. The gentleman from California. 

Mr. GARAMENDI. Once we get those documents about your overall 

plan, there won’t be any questions. 

Mr. ROGERS. With that, I will tell the panelists, we thank you 

for your testimony, your presence here today, and we will adjourn 

this panel and bring in the second panel. 

Mr. RICCIARDELLI. Thank you. 

Dr. MCMILLAN. Thank you. 

Mr. ROGERS. All right. We will call the second panel to order and 

recognize our witnesses, General Frank Klotz, Administrator of 

NNSA. 

Happy birthday. 

General KLOTZ. Thank you, sir. 

Mr. ROGERS. And Mr. Jim McConnell, Associate Administrator 

for Safety, Infrastructure, and Operations at NNSA. 

And I understand that only General Klotz has an opening statement for the record. So you are recognized to summarize your 

statement. 

STATEMENT OF LT GEN FRANK G. KLOTZ, USAF (RET.), ADMINISTRATOR, NATIONAL NUCLEAR SECURITY ADMINISTRATION, ACCOMPANIED BY JAMES McCONNELL, ASSOCIATE 

ADMINISTRATOR FOR SAFETY, INFRASTRUCTURE, AND 

OPERATIONS, NATIONAL NUCLEAR SECURITY ADMINISTRATION 

General KLOTZ. Okay. Thank you, Mr. Chairman. And I hope because it is my birthday you will indulge me. I take great pride in 

starting on time and ending on time, but I may take an extra minute or two in the opening statement. 

Mr. ROGERS. If you want extra time, go ahead. 

General KLOTZ. Thank you, sir. 

Chairman Rogers, Ranking Member Cooper, members of the subcommittee, thank you for the opportunity to discuss the challenges 

and the steps taken by the Department of Energy’s National Nuclear Security Administration to address deferred maintenance and 

the risks associated with aging infrastructure. 

I am pleased today to be joined, as you said, by Jim McConnell, 

who is NNSA’s Associate Administrator for Safety, Infrastructure, 

and Operations, a new position, by the way, that we have created 

in the past 2 years specifically to focus like a laser beam on these 

issues. 

Let me emphasize at the outset that the success of the Nation’s 

nuclear security enterprise and its workforce depends upon safe, 

reliable, and modern infrastructure at our laboratories and at our 

production plants. 
17 

Although the role of nuclear weapons in our national security 

strategy is widely understood and enjoys broad bipartisan support, 

the link between nuclear deterrence and the infrastructure that 

supports it is less well appreciated. 

While much has been accomplished over the past two decades to 

construct the new experimental facilities and high-performance 

computing capabilities required to certify annually the nuclear 

weapons stockpile without nuclear explosive testing, investment in 

infrastructure has generally not kept pace with the growing need 

to replace Cold War-era facilities. 

I can think of no greater risk to NNSA’s multiple and vital missions than the current state of our aging infrastructure. We are 

long overdue to build a modern, safe complex that will meet military requirements, keep the deterrent safe, secure, and effective, 

and enhance worker and public safety. 

At the end of fiscal year 2015, as you have already pointed out, 

Mr. Chairman, the backlog of deferred maintenance at NNSA sites 

totaled approximately $3.7 billion. As one of his major management 

initiatives, Secretary of Energy Moniz directed that the infrastructure investment across all of the Department of Energy, including 

the NNSA, be requested at levels sufficient to halt the growth of 

deferred maintenance starting in fiscal year 2016. 

Accordingly, NNSA’s fiscal year 2016 budget request, subsequently supported by this Congress, will halt the growth of deferred maintenance in the current fiscal year, and NNSA’s fiscal 

year 2017 budget request, plus this committee’s mark, if similarly 

supported by the full Congress, will actually begin to decrease the 

backlog in NNSA’s deferred maintenance in the coming fiscal year. 

I would like to highlight a few of the steps NNSA is currently 

taking to reduce deferred maintenance. Now, these are described in 

greater detail in our written statement. 

But in sum, first, we are increasing funds for recapitalization 

and maintenance efforts. Second, we are also deploying innovative, 

best-in-government project management tools to make risk-informed investment decisions to reduce deferred maintenance. 

Third, we are prioritizing recapitalization projects with deferred 

maintenance reduction as a key criterion. Fourth, we are increasing buying power by expanding efforts to strategically procure common building systems across the enterprise, such as roofs and 

HVAC systems. Fifth, in close consultation with this subcommittee, 

we are completing a site condition review of the physical security 

systems at all NNSA facilities to develop a security refresh strategy over a 10-year period. And six, we continue to make progress 

in disposing of excess facilities. 

On that front, the administration’s fiscal year 2017 budget request includes $200 million to dispose of the 3 million square foot 

Bannister Federal Complex in Kansas City that you have already 

discussed in the previous panel. The plan for this project, which involves transferring the property to a private redeveloper, will save 

the taxpayer as much as $500 million when compared to the government’s cost to complete the decommissioning if we were to do 

it directly. Congress has supported this effort, and it is vitally important that the full funding be available in early 2017 to execute 

this project as planned. 
18 

Finally, NNSA is recapitalizing its infrastructure using traditional line item capital construction projects as well as a number 

of innovative approaches. You have already heard about one of 

those. Again, the Kansas City National Security Campus, which we 

dedicated in 2014. 

This magnificent facility allowed us to move out of the antiquated Bannister Federal Complex, cut our footprint in Kansas 

City in half from 3 million square feet to 1.5 million square feet, 

enhance the productivity and morale of our workforce, and reduce 

operating and maintenance costs, as you heard, by $100 million per 

year. Significantly, the new facility was constructed by a private 

developer using third-party financing made available to the NNSA 

through a GSA [General Services Administration] lease. 

And just last month, NNSA broke ground on the administrative 

support complex at Pantex, which also uses an alternative financing approach. This project will allow roughly 1,000 employees to 

move out of 1950s-era buildings into a modern, energy-efficient 

workspace. It will also eliminate approximately $20 million in deferred maintenance at Pantex. 

We strongly believe the greater use of such approaches to recapitalizing our aging infrastructure should continue to be explored. 

Although we have made important progress in tackling deferred 

maintenance and recapitalizing our infrastructure at all of our 

sites, a great deal of work, in my opinion, still remains to be done. 

The strategy, the plans, the processes, and many of the tools for 

arresting the growth of deferred maintenance, disposing of 

unneeded facilities, and improving infrastructure management are 

in place. 

At the end of the day, however, it ultimately comes down to the 

level of resources made available, and I would submit now is the 

time to invest in them and for the years to come. 

With that, I look forward to answering any questions you and the 

subcommittee may have. 

[The prepared statement of General Klotz can be found in the 

Appendix on page 67.] 

Mr. ROGERS. Thank you for that. I think that we can’t help but 

take note of—you said a lot of important things, but one particular 

statement, and that is that there is no greater risk to our nuclear 

enterprise than this deferred maintenance. To ignore that, I think, 

would constitute congressional malfeasance. And I appreciate your 

candor in making that statement. 

One question I asked the panelists before you was, at the pace 

that we have been taking deferred maintenance dollars and putting 

them against this challenge, do you believe that we will ever be 

able to get ahead of the maintenance issues that face the NNSA? 

General KLOTZ. Let me be perfectly honest about this. I spent a 

number of years, as you know, in the military, and every year you 

operate under a set, relatively constrained budget. That budget 

may go up a few percentage points as a result of inflation or new 

missions, but for the most part, it is a fairly stable amount of funding that you get unless you are in a crisis or some other emergency. 

Right now, the NNSA has a lot of very, very important missions, 

whether it is life extension programs, stockpile stewardship, or our 

programs to reduce nuclear dangers around the world, Naval Reac-
19 

tors. So within that particular set of missions that we have to do, 

there is not a lot of additional funding to spend on deferred maintenance. 

The experience I had in the military was the first dollar always 

goes to the mission, to the pointy end of the spear; the next dollar 

goes to the people who have to employ that spear; and then, if 

there is money left over, then it goes into infrastructure and deferred maintenance. 

And every year commanders would make the decision: I have to 

pay for mission, I have to pay for people, I will take risk this year 

on deferred maintenance or recapitalization and hope that I get additional money next year. And then 1 year becomes 2 years, becomes 5 years, becomes 10 years. 

So I think absent some dedicated resources for dealing with the 

deferred maintenance process, we are going to be able to do some 

of the things that we have done under Secretary Moniz’s leadership 

to sort of halt the growth, but to really turn it around and make 

a huge dent in it is going to require investment over a long period 

of time specifically devoted to this. 

Mr. ROGERS. So at the pace we have been meeting that challenge, will we ever accomplish it without additional money? 

General KLOTZ. In my opinion, sir, no. 

Mr. ROGERS. General Klotz, we have discussed the topic of this 

hearing many times in the past, and I want to thank you and Secretary Moniz for your engagement and personal leadership on this 

issue. I think we are getting traction now, but we both know we 

need a lot more to do. 

To that end, how can we all ensure that regardless of who the 

next President is, the attention, focus, and funding needed for 

NNSA’s infrastructure and deferred maintenance challenges continue into the next administration? 

General KLOTZ. Well, thank you. That is, I think, an extraordinarily important question. I think there is a general consensus 

within the Department of Energy [DOE], including the professional 

civil service, who will continue to work through any transition in 

NNSA, and as you heard, from our M&O [management and operating] partners at the laboratories and the production plants, as 

well as in Congress and in this committee, that NNSA’s infrastructure presents a risk to our strategic deterrent and has to be addressed with some urgency and with resources and with focus. 

Now, as I mentioned in introducing or alluding to the fact that 

Jim McConnell was also here, we created a position within or an 

organization within NNSA specifically to deal with that—we call it 

the Office of Safety, Infrastructure, and Operations—back in January 2015 to make sure that we had the focus on this issue. We 

have also, and Jim can talk about this in greater detail, set up a 

number of processes and tools within the NNSA to help us understand, analyze, and keep focus on this. 

And then at the broader DOE level, under Secretary Moniz’ leadership, we have established key groups, again, predominantly senior career service professionals, to sustain the effort, such as the 

Laboratory Operations Board, the Infrastructure Executive Committee, and others. And Jim, by the way, who is a career senior executive in the civil service, is a member of all of those groups. 
20 

So I think we have put in place the foundation to continue that 

work as we transition to a new administration and a new Congress. 

And, oh, by the way, one of the first things I will tell the transition 

teams when they come in after the election is the importance of 

keeping a focus on this. 

Mr. ROGERS. I appreciate that. I am concerned that as Secretary 

Moniz has outlined in a letter to OMB [Office of Management and 

Budget] last December, which I will introduce for the record, 

NNSA’s outyear funding levels are, quote, ‘‘still only half of the 

$2.8 billion needed to address infrastructure in the future,’’ close 

quote. 

[The letter referred to can be found in the Appendix on page 80.] 

Mr. ROGERS. How do we ensure that this new administration recognizes this shortfall and requests appropriate funding from the 

Congress? 

General KLOTZ. Well, again, Mr. Chairman, we have laid out, 

both in our internal documents as well as reports that we have 

sent up to the Congress on our infrastructure needs, our recapitalization plans, our use of, our ideas on using third-party financing. 

I think we have built a good series of documents and a case which 

will be clearly one of those things that we pass on to the transition 

teams as they come in. 

Also, one of the things we do, we also, as you know, every year 

put out the Stockpile Stewardship Management Plan, and we have 

our other plan on countering and preventing and responding to nuclear dangers across the world, which also lay out the infrastructure that is required to underpin those critical missions, and our 

Naval Reactors folks as well send forward similar reports. 

Mr. ROGERS. Mr. McConnell, does NNSA have a plan for how to 

tackle this backlog of deferred maintenance, and how much will 

that plan cost us in the near term to make a significant dent in 

this problem? 

Mr. MCCONNELL. Yes, sir, we do. You heard from the first panel 

that on a site-by-site basis we construct something called a 10-year 

site plan, which is an integrated assessment of what each site 

needs to support its part of the mission. As you know, there are 

eight sites that have to come together in an integrated whole to 

satisfy our mission. They go out 10 years, is about as far as the 

planning horizon starts to get too fuzzy. 

What we have done very recently is create a master asset plan, 

which is five-eighths of the way through development, that takes 

those individual site plans and then brings them up and connects 

them one level higher as an enterprise level to make sure that we 

can balance risk and investment needs not only to 10 years, but 

out to hopefully 25 years at an enterprise level so that we can connect the infrastructure conditions to its risk posed to the mission 

and then be able to make prioritized investments across the entire 

enterprise to optimize our success and to minimize our risk. 

Now, that gives us an integrated list of what to do when. The 

question of how long it will take gets back to the resources applied 

to it. So as you indicated, and as the Administrator indicated, we 

didn’t get into this problem in a short amount of time. It will take 

us time to get out of it. But with the concerted resources that the 

Secretary and the Administrator have requested and that thank-
21 

fully were actually exceeded in the last two cycles of appropriations, we will start to turn that curve and actually reduce deferred 

maintenance. It will take a long time, two decades, unless there is 

a very significant increase in investment. 

Mr. ROGERS. What do you consider a very significant increase in 

investment that would get that clip down to a decade earlier? 

Mr. MCCONNELL. The history that we have that we can rely on 

is the 10 years where the Facilities and Infrastructure Reinvestment Program, FIRP, was in place. FIRP had at its higher points 

was between $200 million and $300 million a year, and that had 

a noticeable effect. 

Mr. ROGERS. Okay. With that, I will recognize the ranking member for any questions he may have. 

Mr. COOPER. Thank you, Mr. Chairman. 

First, General Klotz, I apologize for your having to spend your 

birthday this way. If you check, it may be a violation of the Geneva 

Conventions for this to happen. 

I couldn’t help but notice in your testimony and in your statement the remarkable statement that if Congress comes through 

and provides $200 million this year to close down Bannister, that 

could save the government $500 million. Whoa. That is pretty 

amazing. We should do stuff like this all day long. 

But I would ask you, and it may be more appropriate for the 

record, and maybe Mr. McConnell can pitch in here, I think the 

public would be very interested in knowing what causes a $300 

million delta like that. Is the government that inefficient, or are 

these facilities so prehistoric or government regulations so cumbersome that just by turning it over to the private sector we can save 

this fantastic amount of money? That is significant. 

[The information referred to can be found in the Appendix on 

page 87.] 

Mr. COOPER. It would also be important to see if we could do this 

elsewhere as well, because this is what is sometimes called lowhanging fruit. Why not pluck this from the branches while it is 

available? 

Mr. MCCONNELL. Sir, I would be happy to. The unique situation 

of the Bannister Federal Complex just inside the Kansas City beltway, it is very valuable from a redevelopment perspective. So when 

we can sell it to this private redeveloper, they can develop it purposefully for the next use, an industrial use. If we as the Federal 

Government have to D&D, deactivate and decommission the facility, we have to take it to standards that would be acceptable for 

any use, which is a cleaner, more intense level of remediation. And 

so that accounts for the significant price difference. The government’s constraints are a little bit more rigid than the private sector 

would have. 

Mr. COOPER. So we would have to make it, say, playground safe 

for children so they could eat the dirt if they wanted to? 

Mr. MCCONNELL. Yes. 

Mr. COOPER. And you are allowing it to be dirtier for an indus- trial use. So we save $300 million by letting it be more polluted. 

Mr. MCCONNELL. Well, to getting it to a point where it still 

meets standards. It will still meet all the standards for its purpose. 

But since the developer will have a specific purpose and the gov-
22 

ernment doesn’t have any specific purpose when it is getting ready 

to clean it, it is a different standard. If we were to repurpose it for 

our own use, we would clean it up to the same standard as this 

private developer, but that is if we were planning to reuse it for 

an industrial activity. 

Mr. COOPER. So government regulations require it to be retrofitted for any purpose, including the most stringent, the cleanest, 

and a private developer can just find a use for it that could be a 

landfill or something. It doesn’t have to be that clean. 

General KLOTZ. In our discussions with the developer, their actual use for it has not come up. That is part of their business 

model. 

Mr. COOPER. I think it is interesting for people to understand 

what causes this incredible arbitrage, you could call it, between two 

types of developers. 

Mr. MCCONNELL. That is the primary difference. There are probably others as well. 

Mr. COOPER. Others, yes. 

Anecdotally at least, I have come to the conclusion that Naval 

Reactors has done a better job of maintaining its facilities than the 

others. I don’t want to pass final judgment on that, but it has led 

me to the thought that with the traditional non-naval military rotation, 2, 3 years in a job, move on, that makes it very tempting 

to leave maintenance problems to your successor. It is kind of built 

in the job because as you put it, first is the mission, the pointy end 

of the spear, then the personnel, and then if there is money left 

over, we maintain things. 

But Naval Reactors and the whole Rickover tradition was you 

were there for the long haul, whether it is an 8-year tour now, it 

can be longer. That gives you a much different perspective than 2 

or 3 years in, 2 or 3 years out sort of point of view. 

So I am also wondering if in addition to the failure for Congress 

to appropriate money for maintenance in some sort of sinking fund 

or amortization or depreciation, that we have a structural issue in 

our military where you are not going to get anything else but ignoring maintenance when you are only there for 2 or 3 years. It 

is almost like the old joke about the envelope in the drawer for 

your successor. Why don’t we figure out a plan at least for these 

ultrasensitive facilities that takes a longer-term perspective. 

General Klotz. 

General KLOTZ. Thank you very much for that comment. You 

raise a very interesting point. First of all, I am glad to hear you 

say that in your opinion Naval Reactors is doing well in this regard 

because, as you know, we have some responsibility for Naval Reactors. The director of Naval Reactors essentially wears two hats, one 

with the Navy and one with the Department of Energy, NNSA. 

And they do have their challenges. I have visited most of their 

major facilities, their laboratories, and there are some buildings 

there which, quite frankly, date back to the early days of the Cold 

War, back to the early Rickover era, and are in need of replacement. In particular the spent fuel handling facility at Idaho where 

they have a large pool where they bring spent naval reactor fuel 

from aircraft carriers and submarines is starting to show some real 
23 

signs of age and needs to be recapitalized, and with the support of 

Congress we are on the track to do that. 

But you raise a good question. In the military and among the political appointees, there is a turnover, and I think that speaks to 

the importance of making sure that—or what we have tried to do 

in NNSA and DOE over the last couple years is to make sure that 

we have clearly articulated, defined, and written down the roles, 

responsibilities, authorities, and accountability of the various activities that take place within the Department of Energy and within the NNSA and then to put in place career senior executives who 

are experienced and experts in this particular field so that as transitions take place they know what they need to do and they have 

the authorities and the game plan to actually carry those things 

out. 

So we have worked very, very hard to make sure that is in place. 

It may not be as satisfactory as an 8-year term for the head of 

Naval Reactors or the head of the Navy’s Strategic Systems Program who also has a longer fixed term, but it is how we have tried 

to address that particular issue. 

Mr. MCCONNELL. If I may add one other aspect. One of the challenges that I have seen that has been faced is how to balance risk 

decisions between short-term programmatic needs and longer-term 

infrastructure risk. And one of the things that we have done recently in NNSA, over the course of the last 2 or 3 years, that has 

been very beneficial both in terms of that decision and how to carry 

this forward, is created a system that more objectively analyzes 

and communicates the risk that infrastructure poses to the mission, so that decisionmakers like Administrator Klotz and the Secretary have a better understanding now than perhaps their predecessors had of what the risk tradeoff actually is between the present and the future. 

The future was always a little fuzzy, and so the decisions tended 

to favor shorter-term risk at the expense of infrastructure. We now 

have a better way of explaining to the Administrator what might 

happen if we either do or don’t invest in infrastructure, and that 

allows for a better risk-informed decision which produces a slightly 

different balance. And I think that has resulted in some hard decisions that have actually gone to increase investment in infrastructure. 

Mr. COOPER. To put this in a more understandable context for 

average citizens, we had a Treasury Secretary once who said that 

nobody in the history of the world has ever washed a rental car, 

because if you don’t think like an owner, you don’t care, you’re not 

going to keep it clean. And anybody that has ever rented an apartment knows that if you don’t keep it clean, you are going to lose 

your security deposit. And the landlord requires that security deposit because they want a Sword of Damocles hanging over your 

head as an incentive to turn it over clean. 

So I wonder in the promotion boards if we are paying adequate 

attention to the state of the facilities that were under a command 

when the commander goes up for a promotion. If they leave it in 

worse shape than they found it, if it is a dump, if they didn’t push 

through the Pentagon bureaucracy for more money to keep it up, 

then maybe that should be a black mark on their career. Because 
24 

otherwise it is just too easy, in and out 3 years, punch your ticket. 

Move on. 

Thank you, Mr. Chairman. I think my time has expired. 

Mr. ROGERS. I thank the gentleman. 

The Chair now recognizes the gentleman from California, Mr. 

Garamendi, for 5 minutes. 

Mr. GARAMENDI. First, Mr. Chairman and Ranking Member, 

thank you for this really important hearing, which we probably 

don’t spend enough time on overall in Congress on these kinds of 

things. And it really comes down to, and I am really pleased that 

you brought up this issue of succession and the like. When I was 

over at the Department of Interior some decades ago now, there 

were what we knew as the Weebees. I see Mr. McMillan knows 

what I am talking about. It is the ‘‘we be here when you are gone.’’ 

And indeed that is part of the discussion we are having here. 

I think that we also are responsible for making choices here, and 

in some respects we have not required the information that we 

need to make the choices, in part because we really have two different operations here. We have got the Department of Energy, and 

then we have got the rest of the military with the nuclear enterprises on the other side, and the budgets are split, the committees 

are split, and the responsibility is also. 

But when taken in totality, the entire nuclear enterprise is really 

dependent upon what goes on here and in NNSA. But you don’t 

have the fancy missiles or the stealth bombers and other kinds of 

things that are part of our responsibility. And so I think it is important for us to be fully aware of this particular issue of not deferred maintenance, but the ability of these facilities to function for 

the purpose of national defense. In other words, in this case the 

bombs themselves. 

And so I need more information, and I would suspect that perhaps my colleagues do too. And if you could provide some of the 

information that apparently has been made available from the laboratories to NNSA, I would like to see at least a synopsis of that 

in the overall context and really how each of these facilities meet 

the essential, I want to emphasize that, the essential role of the totality of the nuclear security system. 

General KLOTZ. Yes, sir, we would be more than happy to provide that. 

[The information referred to can be found in the Appendix on 

page 87.] 

Mr. GARAMENDI. That is a long conversation, and it is, frankly, 

a lot of hard work on at least my part to understand how all this 

fits together, and I will take the time to do that. Because one-off, 

okay, we need a new pit facility. Fine. How does that fit into the 

overall picture of this whole maintenance? 

And I think that my colleague here is quite correct about the incentives in the system, and we be, we all be gone, or we won’t. So 

I think that fits it. 

I am going to let it go at that and look forward to additional information. 

Okay. Thank you. 

General KLOTZ. If I could, sir, I would like to publicly thank you 

for coming over to the Department of Energy and NNSA a few 
25 

weeks ago. A visit of a Member of Congress, as both Congressman 

Rogers and Congressman Cooper know, goes through an organization like wildfire, and it is really a boost to the morale of the people 

who do this work and don’t often get a lot of recognition and appreciation and care for what they do. So thank you, sir, for that. 

Mr. GARAMENDI. The visit was most informative, and I will come 

back whenever there is another opportunity to learn along the way. 

Thank you. 

Mr. ROGERS. I thank the gentleman. 

The Chair now recognizes the gentleman from Colorado for 5 

minutes. 

Mr. LAMBORN. Thank you, Mr. Chairman. Thanks for having this 

hearing. I want to thank the witnesses for being here. 

I don’t have any specific question, but I just want to say that I 

have been to Los Alamos, and I have seen some of the buildings 

right on the fault line. And I have been to Pantex, and I have seen 

some of the decrepit conditions there. And I agree with you, some 

of the deferred maintenance really needs to be addressed. And I 

want to be supportive, working in a responsible and effective way, 

efficient way, to overcome these problems. So thanks for highlighting those and for being here today. 

And, Mr. Chairman, that is all I have, and I yield back. 

Mr. ROGERS. I thank the gentleman. 

Mr. McConnell, can you describe for us some of the various approaches you have employed to deal with some of these infrastructure challenges? And in particular I am thinking about line item 

construction, public-private partnerships, FIRP-like programs, 

other approaches. Give us some idea about what is working, what 

is not working, and what you would like to do. 

Mr. MCCONNELL. Thank you very much. 

First and foremost, as I described a second ago, we start with a 

more objective analytical basis for identifying on an asset-by-asset, 

individual facility basis what each facility’s contribution or a system’s contribution to our mission is. Combining that with an appreciation of the condition of that facility, how likely it is to fail, we 

have the ability to assess risk on a facility-by-facility basis that 

gives us a rationale for prioritization of what infrastructure investments are required. 

At a relatively high level then, we make a decision about the totality of the infrastructure investment that is appropriate at any 

given time. And then we get down to the nuts-and-bolts level of 

what is the specific system or facility or component that needs to 

be fixed and decide whether it is a maintenance-type activity or a 

replacement activity or if it is a major construction activity. And 

that is how we then bin into the various tools that we have at 

hand. 

When it comes to major construction, when we have a large item 

that needs to be replaced, tens, hundreds of millions of dollars, 

there is a very rigorous process, as I am sure you are well aware, 

and one of the first steps in that is to do an analysis of alternatives. We figure out what all the ways we could satisfy the need 

are and then do an analysis of each alternative to figure out which 

one makes the best sense and the best value for the government. 
26 

We go into that, again, very objectively, data driven, without the 

preconceived notions, and then identify which alternative works 

best. 

Two classic recent examples. In Amarillo, for the Pantex administrative support complex, we went through that analysis and determined that the public-private partnership route was the best option and the best value. We have for the Federal staff a need for 

a new facility in Albuquerque, New Mexico. We went through the 

same process. That time the answer that came back was normal 

traditional line item capital construction. 

So we are driven by the data, we are driven by the results to pick 

the option that is best, and it is good to have all of those tools in 

our toolbox because then we can get pretty specific on how to optimize our resources and apply them to the best way. 

Mr. ROGERS. Well, we have heard some examples today from Mr. 

Ricciardelli and Mr. Smith about successful public-private partnerships, and it is no secret I am a big proponent of public-private 

partnerships. And you all just had a real success, or you started 

a real success at Amarillo by taking on a portion of the deferred 

maintenance challenge at the Pantex complex with a public-private 

partnership. 

Where else, is there another challenge on deferred maintenance 

that comes to mind where you think a public-private partnership 

would be the right approach? 

Mr. MCCONNELL. As I said, in every time that we need to deal 

with acquiring a new capital asset, we look at all the aspects, and 

public-private partnership, third-party financing is always, unless 

there is some very unique situation, one of the alternatives that 

we—— 

Mr. ROGERS. But there hasn’t been a project that you are facing 

where you have already done that analysis and you have decided 

if we had the money a public-private partnership would be the solution? 

General KLOTZ. There are other areas that we are currently 

working through. I think when we came up and briefed you or had 

a hearing on third-party financing and public-private partnerships 

we mentioned Livermore, two facilities out there. 

There are two laboratories at Livermore, Lawrence Livermore 

Laboratory and Sandia Livermore. They both have projects which 

are designed not so much to deal with deferred maintenance, although it will, but they are designed to get at another objective 

that the Congress has and that the DOE and NNSA has, and that 

is to create the opportunity for these labs, which are essentially engines of scientific technology and engineering innovation, to be able 

to work better with local industry and local universities and colleges in a collaborative space. 

So at Livermore, again at both labs, we are pursuing buildings 

which would allow the scientists from the national laboratories 

there to mix with people from the outside to advance innovations 

in high-performance computing, for example. So to us that looks 

like a good candidate for a public-private partnership. 

We have been working very, very closely between the headquarters and the two laboratories on this. They have been taking very, 
27 

very careful notes from our experience in getting the Pantex deal 

closed. 

So we are still working the numbers to make sure that we can 

satisfy the requirements of the various OMB circulars, as well as 

the rules that have been put in place by the Congress and will be 

adjudicated by the Congressional Budget Office when it comes to 

scoring. 

Mr. ROGERS. Thank you. I appreciate what you have been doing, 

and I want to pledge to you that I am going to do all I can to work 

with the ranking member to help convince our colleagues that we 

need to meet this challenge more aggressively because the risk to 

our nuclear enterprise is completely unacceptable at present. 

With that, I will yield to the ranking member. Any closing remarks? Has none. 

Gentleman from Colorado? 

With that, I thank you very much for your service to our country, 

and this hearing is adjourned. 

[Whereupon, at 5:47 p.m., the subcommittee was adjourned.] 

A P P E N D I X 

SEPTEMBER 7, 2016 

PREPARED STATEMENTS SUBMITTED FOR THE RECORD 

SEPTEMBER 7, 2016 

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DOCUMENTS SUBMITTED FOR THE RECORD 

SEPTEMBER 7, 2016 

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Note: This image was altered to remove photos that did not reproduce clearly. The original 

slide, with four photos illustrating facilities failures, is retained in the subcommittee files. 
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WITNESS RESPONSES TO QUESTIONS ASKED DURING 

THE HEARING 

SEPTEMBER 7, 2016 

(87) 

RESPONSES TO QUESTIONS SUBMITTED BY MR. COOPER 

Mr. SMITH. Any time a project has an extremely long execution phase there must 

be a comprehensive plan for the maintenance of equipment and systems prior to the 

point at which these items are turned over to the end users for testing and then 

production. As part of the UPF project, we will budget for and implement plans to 

perform this execution phase maintenance. Once the facility is turned over to Y– 

12 operations, maintenance of UPF will become part of the site’s overall maintenance program and be covered by other budgeting mechanisms (as the project will 

have completed at that point). To that end, the UPF-generated Concept of Operations plan provides guidance and expected staffing needs and the UPF-generated 

maintenance analyses outlines preventative maintenance programs and anticipated 

corrective maintenance needs. Those will be combined into anticipated maintenance 

staffing needs for operation that are outside the Future Years Nuclear Security Plan 

(nine years away), but they are being identified for future budgeting that will come 

from the facility’s operating funds. However, without intentional focus and budgeting, the situation can occur where budget tradeoff decisions will lead to less than 

optimal maintenance of the new facility as new facilities do not have a commensurate long-term maintenance funding profile in the same manner as they have for 

new construction. [See page 12.] 

General KLOTZ and Mr. MCCONNELL. The Fiscal Year (FY) 2017 President’s Budget Request includes $200 million for NNSA to transfer the Kansas City Bannister 

Federal Complex to a private developer for demolition, remediation, and redevelopment. The private developer has a significant advantage over NNSA in that it can 

assume responsibility of the property and remediate to a specific, industrial end-use. 

If NNSA were to maintain ownership of the property, NNSA would be required to 

return the property to a much higher level of remediation suitable for any future 

use, due to a lack of intended end-use of the property. Estimates suggest it would 

take NNSA more than a decade to achieve this more intensive level of remediation 

and would cost roughly $1 billion. Therefore, the estimated savings to the government in transferring the property on-time could be as much as $700 million. [See 

page 21.] 

RESPONSES TO QUESTIONS SUBMITTED BY MR. GARAMENDI 

Dr. MCMILLAN. Yes, I would be happy to brief you and your staff on our comprehensive infrastructure plans. NNSA has a new process and system for development of the Future Years Nuclear Security Plan (FYNSP) and that new process 

should produce a product in the beginning of the next calendar year. I would be 

happy to provide that information to you once it has been finalized. [See page 13.] 

General KLOTZ. As requested, NNSA is providing copies of the most recent TenYear Site Plans (TYSP) that were completed in Fiscal Year (FY) 2015 by each of 

NNSA’s eight sites. The TYSPs are created by the M&O contractor at each of 

NNSA’s eight sites to convey the site’s current and future infrastructure needs. 

Starting in FY 2017, the TYSPs will be replaced by a new, enterprise-wide, integrated, strategic infrastructure planning document called the Master Asset Plan 

(MAP). During Calendar Year 2016, NNSA is conducting Infrastructure Deep Dives 

at each NNSA site. The MAP and Deep Dives identify program requirements, infrastructure gaps and risks to meeting those needs, and proposed solutions to accomplish the long-term infrastructure vision. As of September 30, 2016, six of eight 

Deep Dives have been completed. The final two will be completed by early November. The first MAP is scheduled for release in March of 2017 in conjunction with 

the FY 2018 President’s Budget Request. [See page 24.] 

QUESTIONS SUBMITTED BY MEMBERS POST HEARING 

SEPTEMBER 7, 2016 

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QUESTIONS SUBMITTED BY MR. ROGERS 

Mr. ROGERS. Please provide the committee unclassified pictures of the most significant infrastructure challenges and degradations at your sites. 

Mr. SMITH. [No answer was available at the time of printing.] 

Mr. ROGERS. Please describe the impacts of your sites’ infrastructure challenges 

on your ability to attract, retain, and motivate workers? What are the impacts to 

morale? 

Mr. SMITH. There’s no doubt that attracting and retaining the next generation of 

great workers becomes more challenging in facilities that are in a deteriorated state. 

Our workers experience the infrastructure challenges every day and are vigilant in 

their efforts to perform to the highest standards while often working in facilities 

that are less than ideal and are the subject of frequent repairs and outages. Furthermore, many of our workers have had life-long careers at the sites and for them, 

keeping the sites going is truly a service to the nation with a knowledge of the past 

difference these sites have made. Projects like the Jack Case Center and New Hope 

Center at Y–12, the Highly Enriched Uranium Materials Facility at Y–12, and the 

Administrative Support Complex and the High Explosives Pressing Facility at 

Pantex go a long way toward addressing morale issues, but it is no doubt a challenge to recruit top talent while competing against industries that can provide better facilities with modern safety, security, and work environment amenities. Still, 

the excitement at the groundbreaking for the Pantex Administrative Support Complex in August was palpable, and it’s very apparent that employees are excited to 

work in a state-of-the-art facility that is commensurate with the importance of their 

jobs to national security. 

Mr. ROGERS. If provided increased top-line funding to support it, would you favor 

a new FIRP-like program aimed specifically at dealing with deferred maintenance 

and infrastructure challenges? How would you suggest such a program set priorities? 

Mr. SMITH. Significant reductions in deferred maintenance will not be realized 

without continued investment strategies. We are actively establishing priorities and 

addressing deferred maintenance to continue mission work, but that is not enough. 

The Facilities and Infrastructure Recapitalization Program had a lot of success reducing deferred maintenance at Pantex and Y–12, and similar to the FIRP Program, 

a significant additional annual investment above current funding levels is required 

to reduce deferred maintenance at both sites. Until this is done, there will be periodic disruptions to mission accomplishment while unplanned emergent items are 

dealt with and impacts on production are subsequently addressed through recovery 

schedules and worker overtime whenever possible. Current funding levels presently 

allow us in many areas only to treat the symptoms of age rather than address the 

fundamental degradation. Such a program could set priorities using guidelines that 

are already used at both sites: How essential is a given capability for the site. Because of limited funding, we are already forced to make very difficult decisions every 

single day about where to devote funding, and examining how essential a given capability is helps to prioritize where to spend money. While all capabilities are important, certain capabilities are more inextricably linked to mission requirements 

and should be prioritized over other functions, with those considered mission critical 

at the top of the list. Fortunately, along with Lawrence Livermore National Laboratory, Pantex and Y–12 have piloted a software program for the NNSA designed to 

better track and manage building infrastructure maintenance that will help us 

make better prioritization decisions. The sites were designated as BUILDER Centers of Excellence in 2013 by NNSA and are in the process of implementing the U.S. 

Army Corps of Engineers’ BUILDER Sustainment Management System. The program will work with existing management tools like G2 and is designed to let managers proactively respond to infrastructure maintenance needs, and when complete, 

Pantex’s 620 facilities and Y–12’s 345 buildings will be integrated in the program. 

Mr. ROGERS. Please provide the committee unclassified pictures of the most significant infrastructure challenges and degradations at your lab. 

Dr. MCMILLAN. [The photos are retained in the subcommittee files.] 
92 

Mr. ROGERS. Do you believe we currently have a ‘‘responsive infrastructure’’ in 

our nuclear security enterprise? How would you define this term? If given direction 

and resources by the President and Congress, do you believe that NNSA’s enterprise 

produce and deploy to the military a nuclear weapon in 5 years? In 10 years? 

Dr. MCMILLAN. Some elements of the current Nuclear Security Enterprise (NSE) 

infrastructure are responsive, but there are others that are not. I define responsive 

infrastructure as how well the infrastructure we have can respond to new scope/mission deliverables. For this definition, responsiveness is measured in terms of the 

time required to respond. Responding to new scope/mission deliverables would involve execution across three essential elements: facilities, technical/scientific tools, 

and people. Facilities: NNSA has significant efforts underway to invest in critical 

infrastructure for the future of the Enterprise, in particular with efforts for the Uranium Processing Facility (UPF) at Y–12 and the Plutonium Strategy at Los Alamos. 

To create a truly responsive infrastructure, it will be essential for Congress and the 

Administration to continue support for these and other critical capabilities over the 

next decade. Technical/scientific tools: For the Enterprise to succeed, it will require 

significant investments to build upon the success of the first 20 years of Stockpile 

Stewardship. As a nation, we need to build upon our earlier success to establish the 

next generation of both experimental and computing tools so that we can continue 

to certify the stockpile. People: The infrastructure and tools are irrelevant without 

the right people with the right experience; their expertise and state of readiness to 

perform certain types of work is dependent on the degree to which their skills have 

been exercised in critical and necessary areas. It takes more than a decade to ‘‘grow’’ 

design expertise and this expertise must be exercised and challenged constantly to 

retain competency. NNSA and the labs are exercising these people today through 

the Life Extension Programs and other efforts such as the Foreign Nuclear Weapons 

Intelligence program. Despite this body of work, gaps do remain and we will need 

to continue to work to exercise the full set of skill sets across the Enterprise. To 

your question of being able to produce and deploy a weapon, I believe that given 

today’s Enterprise, with military requirements and focused application of NNSA resources, it would be technically possible for the NNSA Enterprise to produce the 

first production unit of a nuclear weapon that is essentially equivalent to those in 

the existing stockpile within 10 years. It is important to note, however, that this 

statement is true today only because the Enterprise has had nearly 15 years of ongoing exercise through the Life Extension Programs. This state of responsiveness 

was not the case in the mid-to late-1990s when significant atrophy of capability had 

occurred. The W88 Alt. 370, although limited in scope, is an example of the Enterprise’s ability to respond relatively quickly to a stockpile interest. Again, this was 

made possible by the fact that the Enterprise was able to build upon capabilities 

and expertise developed and honed through the execution of the W76 and now the 

B61–12 LEPs. With the Alt. 370, Los Alamos and the Enterprise had to quickly respond to a new set of expanded requirements in a compressed timeframe. On the 

one hand, the Alt. 370 shows we can be responsive, but it also suggests that the 

Enterprise would be very challenged to produce weapons in significant quantities 

(the question asks about producing one), or weapons that are different from those 

in the stockpile. Additionally, it is unknown how the Enterprise would respond if 

this new requirement was simply overlaid on top of the work that is already in 

progress since several areas of the Enterprise are fully committed to the program 

of record. Additionally, I would highlight for the Committee the unique challenges 

of nuclear components where response time to bring new infrastructure online is 

routinely measured in decades. 

Mr. ROGERS. Please describe the impacts of your lab’s infrastructure challenges 

on your ability to attract, retain, and motivate workers? What are the impacts to 

morale? 

Dr. MCMILLAN. The Laboratory works hard to attract and retain the best and 

brightest workforce, and we are mindful that we are recruiting in a very challenging 

environment, competing against other laboratories and tech giants in Silicon Valley 

and elsewhere. We typically succeed when we can demonstrate how recruits will be 

able to work on complex scientific and technical challenges, and have access to 

state-of-the-art experimental and supercomputing tools. Workers can become 

demotivated quickly, however, as a consequence of residing in spaces that are in 

poor condition, buildings with systems that break down frequently, and areas in 

which repairs are protracted or take a long time to commence. When I testified before the Committee, I talked about the challenges of recruiting new postdocs and 

scientific staff to subpar space—just recently a postdoc relayed his frustration about 

the air conditioning in his office not working in the heat of the summer. Even some 

of our most distinguished scientists work in subpar environments every day. In the 

weeks following the hearing, I was visiting one of our senior scientists in his labora-
93 

tory space. The researcher had just been named the winner of the prestigious American Physical Society (APS) Herman Feshbach prize, a significant and highly prestigious recognition from the international scientific community. I was troubled to see 

when I sat in his conference room that the ceiling tiles were stained from water 

leaks and as I took a phone call in his administrator’s office, I saw rodent traps deployed. Staff morale is also impacted by the pace at which infrastructure upgrades 

can be made. Los Alamos works to efficiently invest funds from NNSA and our internal site support budgets to address infrastructure issues. At the same time, the 

scale of the Laboratory, and the age of our facilities makes it impossible to get to 

everything at the pace that we would like to. 

Mr. ROGERS. If provided increased top-line funding to support it, would you favor 

a new FIRP-like program aimed specifically at dealing with deferred maintenance 

and infrastructure challenges? How would you suggest such a program set priorities? 

Dr. MCMILLAN. Yes, if new top-line funding were made available to support a new 

FIRPlike program, we would agree that it would be a good thing for the Enterprise. 

Priorities should be set following the NNSA approach: elimination of unneeded facilities; and improved maintenance for facilities that support all mission sets at the 

national security laboratories, plants, and the Nevada National Security Site. 

Mr. ROGERS. Have you noticed any impact on your ability to attract, retain, and 

motivate workers since the move to your new facility? To morale? Do you have any 

concrete data on this that you can provide to the committee? 

Mr. RICCIARDELLI. One of the most exciting, and most visible, aspects of our transformation was our new state-of-the-art LEED® Gold-rated manufacturing and engineering facility. The Kansas City National Security Campus’s (KCNSC) unique design features give this building a high-tech look with an environmentally-friendly 

presence. The award winning design establishes a workplace that inspires and encourages collaboration, while celebrating our manufacturing and engineering culture. 

A comprehensive Culture and Motivation communications plan was deployed to 

ensure employees were informed and engaged throughout the move. Engagement 

survey results showed 71% felt change was important to our success. Following the 

move, a survey was conducted and 97% of respondents agreed that overall, they 

were satisfied with their move experience. Employee engagement survey scores increased 13% from 2012 to 2014 (there was no survey conducted in 2015). Honeywell 

also conducts positive employee relations surveys annually, and the Kansas City location scores have increased on 19 of 20 questions since 2013 with some of the biggest increases in pride (up 6%) and job security (up 11%). 

Significant time and effort has been invested in our talent pipeline and recruiting 

the critical skills needed to accomplish the NNSA mission. We are confident the new 

facility creates an atmosphere in which people feel valued and inspired. Although 

the attrition rate at KCNSC has remained fairly constant overall, we have been experiencing lower professional/managerial turnover since moving into the building 

than we did in the year leading up to it. 

Mr. ROGERS. Please describe the process that your company and NNSA went 

through to build the new Kansas City National Security Campus. This was a pretty 

unique project for NNSA in that it was both a public-private partnership and it totally replaced an NNSA site, moving it to a new building and an entirely new location. What lessons were learned during this process? How are you helping NNSA 

share and apply these lessons across the enterprise? 

Mr. RICCIARDELLI. The process used was a combination of the DOE O 413.3B 

process for the acquisition of capital assets and the GSA government lease process 

using third-party financing as shown below. 
94 

Key in this process was cooperation between NNSA and GSA where project approval was granted by NNSA through Critical Decision-1 (CD–1) of the DOE O 413 

process in combination with OMB and Congressional approval through the GSA prospectus process. The requirements for the site were assembled by NNSA in the Program of Requirements document and those requirements were bid by private developers through the GSA Solicitation for Offer. Not shown in the diagram above is 

the National Environmental Policy Act process requirements that were followed in 

parallel. This process currently cannot be used on federally owned real estate due 

to federal statutes. Because the project assets are privately owned, the new site produces property tax revenues and therefore local tax incentives were sought and applied. 

The construction and occupancy projects were largely separated. Although occupancy wasn’t technically a capital acquisition project, DOE O 413 provided the process framework and was used to provide program controls to execute the entire occupancy project which had little direct GSA involvement. Tenant improvements at the 

site were also separated with some being provided as part of the lease according 

to GSA standards, while tenant improvements unique to NNSA’s mission were funded directly by NNSA outside of the lease. 

The project team captured nearly 300 lessons learned from the eight year project 

and continues to share these lessons with other major projects within NNSA including the Uranium Process Facility at Y–12 and the Administrative Office Building 

at Pantex that are currently in work. Perhaps the most significant lesson learned 

is that NNSA can use its own real estate and third party financing authority to accomplish similar projects without complex integration that is needed to partner with 

GSA. 

Mr. ROGERS. Do you believe we currently have a ‘‘responsive infrastructure’’ in 

our nuclear security enterprise? How would you define this term? If give direction 

and resources by the President and Congress, could NNSA’s enterprise produce and 

deploy to the military a nuclear weapon in 5 years? In 10 years? 

General KLOTZ. A responsive nuclear infrastructure is one that reflects the resilience of the nuclear enterprise to unanticipated challenges or emerging threats, and 

the ability to anticipate innovations by an adversary and to counter them before our 

deterrent is degraded—all while continuing to carry out the day-to-day activities in 

support of the stockpile. Elements of a responsive infrastructure include the people, 

the science and technology base, and the facilities and equipment needed to support 

a right-sized nuclear weapons enterprise designed to maintain a safe, secure, and 

effective nuclear weapons stockpile. The 2010 Nuclear Posture Review identified key 

capabilities required of a responsive nuclear infrastructure. NNSA’s Uranium Strategy and Plutonium Strategy were developed to address several of these key capabilities, including plans to address infrastructure issues. A number of critical investments, including the Uranium Processing Facility (UPF) and the Chemistry and 

Metallurgy Research Replacement (CMRR) Project, are currently underway to sup-
95 

port the continued execution of these key capabilities. Both projects will move operations from degraded facilities into newer buildings, increasing the responsiveness 

of the enterprise. Additionally, investments in other capability areas such as tritium, lithium, and microelectronics production are either planned or budgeted. 

Alongside these production capabilities, NNSA also invests in nuclear weapon research, development, testing, and evaluation (RDT&E). Initiatives like Exascale 

computing will advance predictive modeling of weapon systems, aiding in qualification and experimental design. These capabilities support continuing stockpile certification and support responsiveness by enabling certification of changes to the stockpile. Much of NNSA’s infrastructure is old and brittle and we are making key investments to ensure the complex is able to be responsible to its national security 

missions. More than 50 percent of NNSA’s facilities are over 40 years old, nearly 

30 percent date to the Manhattan Project era, and failures are increasing in frequency, severity, and unpredictability. These failures require funding for correct 

maintenance that could otherwise be invested in infrastructure modernization activities to further improve the responsiveness of NNSA’s infrastructure. There are, 

however, a number of investments that are underway to address key infrastructure 

requirements. Current and future support to readiness and responsiveness is provided through NNSA investment in vital general purpose infrastructure projects 

such as the TA–3 Substation Replacement project at Los Alamos National Laboratory. The project, which began in FY 2016, will replace a degraded and increasingly 

unreliable system with a modern, reliable, and more robust system that is easier 

and more cost effective to maintain and operate. The new substation will reduce deferred and emergency maintenance, improve safety, and upgrade and increase 

power import capacity to support new programs. By 2025, NNSA will have developed and deployed to the military three life-extended warhead systems (W76–1, 

B61–12, and W88 Alt 370.) The average time from NWC authorization of Phase 6.2/ 

6.2A (Feasibility Study and Option Down-Select/Design Definition and Cost) to First 

Production Unit (FPU) has been between 9–11 years for these programs, with design complexity, funding, administrative regulations, and technical challenges driving the time range. The actual time to complete a program depends on the complexity of the work, the quantity to be produced, and the amount of funding appropriated. Although each of these programs has experienced delays due to funding and 

scope alterations, the enterprise has shown an improving trend in execution. Continued investment in infrastructure and equipment is needed to increase this trend. 

The 2010 Nuclear Posture Review states: ‘‘The United States will not develop new 

nuclear warheads. Life Extension Programs will use only nuclear components based 

on previously tested designs, and will not support new military missions or provide 

for new military capabilities.’’ However, should a scenario arise where a new mission or capability was required, coupled with National will, Executive backing, and 

Congressional funding, the time to produce a weapon would likely be significantly 

reduced. Without continued and predictable modernization investment, NNSA’s ability to meet the challenges of unanticipated world events will be reduced. 

Mr. ROGERS. How does the state of NNSA’s infrastructure impact its readiness 

and responsiveness to react to changes in programs and mission needs? 

General KLOTZ. A responsive nuclear infrastructure is one that reflects the resilience of the nuclear enterprise to unanticipated challenges or emerging threats, and 

the ability to anticipate innovations by an adversary and to counter them before our 

deterrent is degraded—all while continuing to carry out the day-to-day activities in 

support of the stockpile. Elements of a responsive infrastructure include the people, 

the science and technology base, and the facilities and equipment needed to support 

a right-sized nuclear weapons enterprise designed to maintain a safe, secure and effective nuclear weapons stockpile. As stressed in the 2010 Nuclear Posture Review, 

NNSA’s infrastructure must be able to not only support the work we currently have 

planned, but respond to technical challenges and geopolitical surprises. Following 

Congressional direction provided in the National Defense Authorization Act for Fiscal Year 2016, NNSA is carrying out a Stockpile Responsiveness Program in order 

to identify, sustain, enhance, integrate, and continually exercise all capabilities required to conceptualize, study, design, develop, engineer, certify, produce, and deploy nuclear weapons. This program looks for potential future gaps in the deterrent 

in conjunction with the DOD and exercises everything from design to testing in a 

substantially compressed timescale. NNSA continues to maintain a safe, secure, and 

effective nuclear weapons stockpile while being responsive to the nation’s current 

nuclear security needs. That said, more than 50 percent of NNSA’s nuclear infrastructure includes facilities that are over 40 years old, and almost 30 percent date 

to the Manhattan Project. Life Extension Programs and weapons dismantlement, 

coupled with the normal stockpile stewardship activities, have increased the demand placed upon this infrastructure. Without significant, sustained, and predict-
96 

able modernization investment, the risk to NNSA’s ability to meet the challenges 

of unanticipated world events while maintaining the nuclear weapons stockpile safe, 

secure, and effective will increase. Further, in order to sustain the nuclear deterrent 

over the long-term, NNSA requires reliable and modern programmatic, security, and 

general purpose infrastructure that not only provides for today’s capabilities, but allows for the opportunity to expand future capacities. 

Mr. ROGERS. What is your view of the impact of sites’ infrastructure challenges 

on NNSA’s ability to attract, retain, and motivate highly-skilled workers? What are 

the impacts to morale? 

General KLOTZ. To attract and retain a workforce capable of performing NNSA’s 

missions to the highest standards, NNSA must compete with companies and universities that have state-of-the-art facilities, the latest technologies, and modern work 

environments. Recruitment is a challenge with degraded, and in certain places obsolete infrastructure and equipment. NNSA facilities continue to experience infrastructure related failures (e.g., power outages, inadequate heating/cooling, and deficient IT/communication services). This results in workforce disruptions and personnel moves to perform infrastructure upgrades or repairs to restore the basic necessities. NNSA workers often work through infrastructure and equipment deficiencies in order to meet today’s mission deliverables. However, if infrastructure improvements are not demonstrated across the NSE to attract and retain highlyskilled workers and improve working conditions and efficiencies, then NNSA is at 

risk of being unable to meet national security requirements in the future. NNSA 

has implemented a project prioritization methodology that identifies the most pressing infrastructure investments that reduce the highest risks including workforce 

ability to deliver mission. 

Mr. ROGERS. What projects not currently underway is NNSA considering that 

could leverage public-private partnerships? 

General KLOTZ. As part of our improved project management initiatives, NNSA 

implements a comprehensive Analysis of Alternatives (AOA) process to identify the 

most cost- effective approach for each mission need. NNSA uses public-private partnerships when an AOA determines it appropriate. Currently, Los Alamos National 

Laboratory, Lawrence Livermore National Laboratory and Sandia National Laboratories are seeking new facilities including high-performance computing facilities and 

experimental facilities. 

Mr. ROGERS. If provided increased top-line funding to support it, would you favor 

a new FIRP-like program aimed specifically at dealing with deferred maintenance 

and infrastructure challenges? How would you suggest such a program set priorities? 

General KLOTZ. The establishment of the Office of Safety, Infrastructure, and Operations in January 2015 along with our current budget structure—approved by 

Congress for Fiscal Year (FY) 2016—provides NNSA with flexibility necessary to respond to emergent needs. Within the Office of Safety, Infrastructure, and Operations, NNSA has two FIRP-like programs that address deferred maintenance: 

• Maintenance and Repair of Facilities; and 

• Recapitalization: Infrastructure and Safety. 

Sustained, predictable, and increased investments in these two programs are 

needed to improve the condition of NNSA infrastructure and reduce deferred maintenance. NNSA has a project prioritization methodology that prioritizes annual investments by evaluating key criteria. Criteria evaluated include deferred maintenance reduction, program requirements, safety and programmatic risk reduction, 

and increases in operational efficiency and/or productivity. 

Mr. ROGERS. How does NNSA measure its backlog of deferred maintenance? What 

metrics are used and how is the term defined? Does NNSA have a rigorous and 

well-documented means of measuring this? 

Mr. MCCONNELL. NNSA determines deferred maintenance based on condition assessment surveys. Deferred maintenance is defined by the Federal Accounting 

Standards Advisory Board (FASAB) as: Maintenance and repairs that were not performed when they should have been or were scheduled to be and which are put off 

or delayed for a future period. The determination of acceptable condition may vary 

both between entities and among sites within the same entity. Management shall 

determine what level of condition is acceptable. NNSA has worked with representatives from NNSA sites to amplify guidance to standardize reporting of deferred 

maintenance across all NNSA sites. The implementation guidelines are documented 

and released annually in the Office of Safety, Infrastructure, and Operations’ Program Management Plan (PMP). NNSA continuously seeks to improve its information on deferred maintenance to ensure accuracy and consistency across NNSA’s enterprise. In 2016, NNSA is using this standardized approach to revalidate information on the condition of infrastructure and the assessment of deferred maintenance 
97 

and repair needs to ensure accuracy and consistency across NNSA’s enterprise. The 

results will not be available until after the fiscal year ends, but NNSA expects that 

this will result in some amount of deferred maintenance being reclassified as other 

repair needs, so there will be a one-time administrative reduction to the current deferred maintenance total. 

Mr. ROGERS. NNSA’s budget request says it will halt the growth of the $3.7 billion 

backlog of deferred maintenance across the nation’s nuclear security enterprise, 

which is an improvement on decades of increasing backlog. But for the second year 

in a row it would not decrease that backlog. What are the risks to safety and to 

NNSA’s mission of continuing to operate in these facilities? 

Mr. MCCONNELL. In Fiscal Year (FY) 2016, NNSA will halt the growth of deferred 

maintenance, and the FY 2017 budget request, if fully supported, will allow NNSA 

to begin reducing deferred maintenance and arresting the decline of infrastructure 

by: 

• Increasing funds for recapitalization and maintenance efforts; 

• Disposing of excess facilities; 

• Increasing buying power via strategic procurement of common building systems 

across the enterprise (e.g., roofs, HVAC); and 

• Improving project management capabilities to make risk informed investment 

decisions. 

NNSA’s capability to achieve its programmatic goals is dependent upon safe and 

reliable infrastructure. However, much of NNSA’s infrastructure is degraded and 

the condition of nearly two-thirds of NNSA’s infrastructure is less than adequate to 

meet mission needs. As a result, infrastructure failures are increasing in frequency, 

severity, and unpredictability. This poses an increasing safety and programmatic 

risk to NNSA. Facility and equipment failures either impact the mission directly or 

impact our ability to ensure safe and secure operations. In the latter case, NNSA 

and our M&O contractors take action to put operations in a safe and secure condition. This usually includes suspending operations, which results in mission impacts. 

Mr. ROGERS. Does NNSA have metrics or ways to measure the inefficiencies or 

costs that are being borne because of these old buildings and this large backlog of 

deferred maintenance? Please provide a rough order of magnitude estimate. 

Mr. MCCONNELL. NNSA is investigating new measures to give greater insight into 

the costs and inefficiencies caused by the declining state of infrastructure. 

Mr. ROGERS. How does NNSA prioritize between preventative maintenance and 

recapitalization? How does it judge when to continue preventative maintenance 

versus when a building requires demolition and a full-rebuild? 

Mr. MCCONNELL. NNSA is deploying a number of new management tools to improve our ability to make data-driven, risk-informed investment decisions to address 

infrastructure challenges. One such tool, BUILDER, is a web-based software developed by the U.S. Army Corps of Engineers that enables decisions concerning when, 

where, and how to best maintain, repair, and recapitalize infrastructure. The tools 

and processes serve as a guide and are not intended to replace expert analysis informed by program integration. A primary consideration of when a building requires 

demolition and replacement is when a facility can no longer house the intended capability or mission need. 

Mr. ROGERS. Please provide the committee a comprehensive list of currently unfunded infrastructure and deferred maintenance projects that NNSA could execute 

in the next several years, if provided increased resources. 

Mr. MCCONNELL. As requested, NNSA is providing a list of currently unfunded 

Recapitalization projects that NNSA could execute in the next several years should 

additional resources be available. The list provided is unconstrained and builds from 

the project list included in the NNSA Fiscal Year 2017 President’s Budget Request. 

National Nuclear Security Administration 

Infrastructure and Safety 

Over Target FY 2017 Recapitalization Projects–October 2016 

Rank Site Project Name Total Project 

Cost ($K) 

1 LLNL Site 300 Electric Utility Display System Upgrade $7,000 

2 LANL LANSCE Sector A Tunnel Fire Suppression System Installation $3,000 

3 LLNL B132N HVAC System Variable Air Control Replacement $5,000 
98 

National Nuclear Security Administration—Continued 

Infrastructure and Safety 

Over Target FY 2017 Recapitalization Projects–October 2016 

Rank Site Project Name Total Project 

Cost ($K) 

4 Y–12 Bldg 9204–2E Wet Pipe Systems 1&2 50 Year Sprinkler Head Replacement $5,500 

5 Y–12 Bldg 9995 Air Handling Unit (AHU) 2000 Replacement $6,000 

6 Y–12 Area 5 15 kV Underground Cable Replacement $5,000 

7 KCP Kirtland Ops NC–135 Site Disposition $4,900 

8 LLNL Bldg 175 Characterization $1,500 

9 Y–12 Bldg 9204–2 Ceiling Concrete and Steel Inspection and Replacement $6,000 

10 PX Bldg 12–84E Generator Replacement $2,000 

11 KCP Bldg 2 Specialty Welding Applications Capital Equipment Replacement & 

Upgrade $1,200 

12 LANL PF–4 Vault Storage Renovation $7,500 

13 LLNL Utility Safety Upgrades to Plating Shop, B322 $2,500 

14 SNL C914 Seismic Upgrades to Achieve Code Compliance $9,720 

15 LLNL Bldg 292 Characterization $2,000 

16 LLNL Site 200 and 300 Transition and Disposition of 48 Trailers $2,500 

17 SNL SNL-Hawaii Mt. Haleakala Disposition of 3 Facilities $934 

18 LLNL Site-Wide Low Conductivity Water System Station/Cooling Tower Replacement $6,000 

19 LLNL S200 Failing Underground Utility Valves & Water Distribution Piping Replacement $5,000 

20 PX Building 12–84E Generator Replacement $2,000 

21 SNL C912 Major Building Renovation, Phase 3 $5,000 

22 LLNL B131 Engineering’s Cornerstone Office Building Upgrade $7,500 

23 KCP Product Testing Area Capital Equipment Replacement $2,490 

24 SNL Substation 5 Loop Upgrade, Redundant Feeder Installation $5,000 

25 Y–12 9204–04 Deinventory $8,000 

26 PX Bldg 12–24E Chiller Replacement $2,000 

27 LANL Small Improvement Project in 3 Facilities (53–003,22–0005, 03–0039) $1,300 

28 LLNL B805 Classified Machine Shop Infrastructure Renovation $3,500 

29 LANL CMR Initial Facility Closure, Wing 2,3,5 and 7 Clean Up $1,500 

30 LLNL B327 Non-Destructive Evaluation Laboratory Renovation $2,500 

31 LLNL B391 HVAC Water Temperature Control Upgrade $3,000 
99 

National Nuclear Security Administration—Continued 

Infrastructure and Safety 

Over Target FY 2017 Recapitalization Projects–October 2016 

Rank Site Project Name Total Project 

Cost ($K) 

32 Y–12 Re-line Failing Sections of Sitewide Potable Water Distribution Piping $8,000 

33 LANL TA–03–0102 Component Manufacturing Virtual Vault Type Room Installation $1,599 

34 KCP Production Area Renovations for Floor Space Optimization $2,143 

35 LLNL Disposition of Buildings B326, B221, & B221 Retention Tanks $2,000 

36 SNL C911 Renovation to Convert Office to Lab Space $5,000 

37 PX Bldgs 12–85 and 12–96 UPS Replacements $2,250 

38 PX Bldg 12–44 UPS Replacement & Equipment Room Reconfiguration $3,000 

39 PX Bldg 11–51 Generator and UPS Replacement $2,250 

40 PX Bldgs 12–98E1 and E2 UPS and Generator Replacement $3,000 

41 LANL Weapons Engineering Tritium Facility Glovebox and Systems Renovation $8,250 

42 Y–12 Bldg 9720–82 (HEUMF) VESDA Installation $5,000 

43 Y–12 9204–2E Criticality Accident Alarm System (CAAS) $4,500 

44 LANL D&D of the 100,000 gallon Single Walled Storage Tank (TA–50–90) $2,500 

45 NNSS Atlas Machine Removal $3,500 

46 SNL Coyote Test Field, Twin Tanks Piping Replacement $173 

47 SNL NM High Voltage System, Overhead Switch- SW–390 Replacement $153 

48 SRS HAOM Tritium Grab Sample Capability move to TEF $1,400 

49 SNL Natural Gas System, Tech Area I, Piping Replacement $1,194 

50 LLNL B332 Diesel Generator Replacement Project $1,500 

51 SNL Bldg 960 Chilled Water System Upgrade $2,950 

52 LANL PF–4 Fire Wall Upgrades $7,000 

53 SRS HANM Obsolete Oxygen Monitor Replacement in Loading Line 6 Glovebox 

(L6–O2) $1,815 

54 SRS HANM Obsolete Oxygen Monitor Replacement in Finishing Line 6 (F6–O2) 

Glovebox $1,815 

55 LLNL B806/B810 High Explosives Machining/Assembly—HVAC and Electrical 

DM reduction and recapitalization $4,773 

56 SNL NM Tech Area III/V, 14′′ Water Main Replacement $4,140 

57 KCP Bldg 2 Specialty Welding Applications Equipment Replacement and Upgrade $1,136 

58 NNSS Water/Wastewater Systems—CP Hill Water Line Replacement $7,000 

59 Y–12 Bldg 9212 50 Year Sprinkler Head Replacement (Wet Pipe System 009) $4,400 
100 

National Nuclear Security Administration—Continued 

Infrastructure and Safety 

Over Target FY 2017 Recapitalization Projects–October 2016 

Rank Site Project Name Total Project 

Cost ($K) 

60 Y–12 Bldg 9204–02E Transformer, Interrupter, Switches & Underground Cable 

Replacement $2,000 

61 SNL Bldg 1012—Battery Test Facility $8,000 

62 PX Bldg 12–104A Blast Door Interlock Programmable Logic Controller Replacement $2,000 

63 Y–12 Bldg 9215 50 Year Sprinkler Head Replacement (Wet Pipe System 004) $1,700 

64 KCP Bldg 2 Special Application Machining and Welding Area Renovations $2,143 

65 LANL RLWTF Ground Water Permit Discharge Regulatory Requirements Mitigation (Zero Liquid Discharge Liner Replacement & Room 60 Configuration) $8,000 

66 NNSS New Mercury Consolidated Operations Complex Building 1 (23–460) $9,000 

67 SRS Workplace Improvements $500 

68 LLNL B321/B322 HVAC & Electrical Replacement $5,725 

69 Y–12 Bldg 9212 Room 1022A Ventilation System Installation $1,000 

70 LLNL Site-wide Mechanical Utility Valves and Water Distribution Piping Replacement $5,000 

71 Y–12 Bldg. 9212 302 Steam Supply Station and SF–302 Steam Coil Replacement $1,700 

72 LLNL B132/B321A/B451 Fire Protection Systems Replacement (DM) $4,360 

73 SNL SNL/CA Sanitary Sewer Replacements $7,000 

74 NNSS U1a Shaft Wood Lagging Replacement $8,100 

75 LANL PF–4 Fire Water Loop Component Replacements $7,395 

76 NNSS U1a Public Address System Replacement $3,000 

77 KCP Metal Tooling and Production Additive Manufacture Installation $9,000 

78 SRS HAOM to HANM Reservoir Assessment Relocation $6,200 

79 Y–12 Bear Creek Road 13.8 kV Electrical Distribution Installation $8,600 

80 KCP Bldgs 2 & 3 Analytical Testing and Controls Capital Equipment Replacement and Upgrade $2,878 

81 Y–12 Bldg 9204–02 Elevator #2 Replacement $3,000 

82 SNL NM High Voltage Power System, Substation 5 Loop Redundant Feeders 

Upgrade $3,180 

83 NNSS DAF Automated Energy Management System (AEMS) Replacement $6,700 

84 LLNL B222A Nuclear Explosives Package Device Component Engineering Laboratory $9,900 

85 SNL Bldg 878 (Process Development Lab) Renovation $8,500 
101 

National Nuclear Security Administration—Continued 

Infrastructure and Safety 

Over Target FY 2017 Recapitalization Projects–October 2016 

Rank Site Project Name Total Project 

Cost ($K) 

86 Y–12 Bldg 9204–02 50 Year Sprinkler Head Replacement (Wet Pipe System 

005) $3,800 

87 Y–12 Bldg 9995 Chilled Water and Steam Condensate Piping Replacement $3,000 

88 Y–12 Bldg 9212 50 Year Sprinkler Head Replacement (Wet Pipe System 007) $5,800 

89 Y–12 Bldg 9215 Switchgear 253 Replacement $4,000 

90 LLNL B322 Plating Shop Utility Safety Upgrades $2,500 

91 LLNL B332 iCAM Alarm System Upgrade $1,000 

92 Y–12 Bldg 9204–02 Stab-Lok and Fused Electrical Panel Replacement $1,900 

93 LLNL B131 High Bay HVAC Replacement $4,390 

94 Y–12 Fire and Potable Water Replacement of 9 Laterals to Nuclear Facilities $3,000 

95 LANL SM–39 Classified Machine Shop Upgrade $4,000 

96 Y–12 Demineralized Water Delivery System Replacement $7,500 

97 Y–12 Bldg 9995 Supply Fan Replacement/Refurbishment $5,000 

98 LLNL B805 S300 Classified Machine Shop Ventilation & Utility Renovation $3,500 

99 LANL PF–4 Fire Water Loop Component Replacements (Pumps & Boiler Replacement) $7,105 

100 SRS Analytical Lab Relocation From 234–H to 264–H $3,000 

101 LLNL Site 300 Storm Water Safety Improvements & Erosion Control (Elk Ravine) $4,925 

102 NNSS DAF Domestic Water System Upgrade $4,700 

103 NNSS U1a Lightning Protection Upgrades $1,900 

104 LANL TA–16–0303 Renovation for Crystal Lab Relocation $3,000 

105 PX Bldg 12–31 HVAC and DH Replacement $4,500 

106 NNSS DAF Electrical Substations Upgrade $5,500 

107 PX Bldg 12–85 and 12–96 UPS Replacement and Generator Installation $2,000 

108 PX Bldg 12–126 HVAC Replacement $4,500 

109 KCP Bldg 2 Assembly, Electrical & Fabrication (AEF) Capital Equipment Replacement and Upgrade $2,079 

110 LLNL B151 Renovation of 4 High Level Radiochemistry Laboratories (Anteroom 

renovation) $4,655 

111 KCP Bldgs 2 & 3 Non-destructive Testing Capital Equipment Replacement and 

Upgrades $2,490 

112 KCP Bldg 2 Paint and Heat Treat Capital Equipment Replacement $2,575 

113 LLNL Sustainable Chilled and Heating Hot Water Systems Modernization $3,000 
102 

National Nuclear Security Administration—Continued 

Infrastructure and Safety 

Over Target FY 2017 Recapitalization Projects–October 2016 

Rank Site Project Name Total Project 

Cost ($K) 

114 PX Lightning Protection System Upgrade for 10 MAA Facilities $8,000 

115 KCP Bldgs 2 & 3 Special Materials Production and Rubber and Plastics Capital Equipment Replacement and Upgrade $2,986 

116 PX Bldg 12–98 UPS Replacement and Generator Installation $3,000 

117 KCP Bldgs 2 & 3 Environmental Testing and Controls Capital Equipment Replacement and Upgrade $2,754 

118 LANL TA–53–0003 (LANSCE) Fire Suppression System in Accelerator Tunnel Installation $5,800 

119 LLNL B170 Upgrade Classified Computing and Communications $2,500 

120 PX Bldg 11–55 UPS & Generator Replacement $2,000 

121 KCP Bldgs 2 & 3 Paint & Heat Treat and Rubber and Plastics Area Renovations $1,654 

122 LANL Firing Sites Confinement Vessel Building Construction $8,750 

123 PX Bldg 12–104A Uninterruptible Power Supply Replacement $1,500 

124 KCP Bldgs 2 & 3 Assembly, Electrical & Fabrication and Environmental Testing Area Renovations $2,289 

125 PX Bldg 12–99 UPS Replacement $1,500 

126 PX Bldg 12–94 UPS Replacement $1,500 

127 KCP Bldgs 2 & 3 Process Marking and Printing Applications Capital Equipment Replacement and Upgrade $2,785 

128 PX Bldg 12–121 OMI & BDI Controller Replacement $4,000 

129 PX Bldg 12–104 Blast Door Interlock PLC Replacement $4,000 

130 PX Bldg 12–86 Uninterruptible Power Supply Replacement $1,500 

131 PX Bldg 12–130 Generator and UPS Replacement $1,500 

132 PX Bldg 12–121 UPS Replacement $1,250 

133 NNSS Mercury Sewer Lines Replacement $8,450 

134 LLNL Bldg 28XX Complex Disposition of 4 trailers $2,500 

135 Y–12 Bldg 9201–05 Deinventory $20,000 

136 Y–12 Bldg 9202–04 Deinventory $1,000 

137 LANL TA–16–0306 Characterization $2,000 

138 NNSS Mercury Bldgs 23–517 & 23–B, 23–C, 23–D Disposition $2,000 

139 NNSS Mercury Disposition of 10 facilities $2,400 

140 SRS Bldg 236–H shutdown $2,000 
103 

National Nuclear Security Administration—Continued 

Infrastructure and Safety 

Over Target FY 2017 Recapitalization Projects–October 2016 

Rank Site Project Name Total Project 

Cost ($K) 

141 PX Bldg 11–029 Shutdown $2,600 

142 LLNL Bldg 363 Biomedical Laboratory Disposition $1,000 

143 NNSS Area 6 Disposition of 5 facilities $1,000 

Mr. ROGERS. Please provide us a summary of the FIRP program, what it accomplished, and how much it cost. How did FIRP set priorities? Why was FIRP terminated? 

Mr. MCCONNELL. NNSA successfully completed the Facilities and Infrastructure 

Recapitalization Program (FIRP) in 2013. FIRP was created to reduce a substantial 

accumulation of backlogged facility maintenance, repair, and demolition projects 

across NNSA’s eight sites. Among its achievements, FIRP: 

• Executed nearly 800 projects throughout the NNSA enterprise; 

• Eliminated $900 million of baselined deferred maintenance and brought the 

overall condition of the enterprises’ essential facilities up to industry standards; 

• Managed 625 recapitalization projects ($1.2 billion) that refurbished laboratory 

and production facilities, repaired or replaced electrical and mechanical equipment, utility lines, fire protection, power and lighting systems, roofs, roads and 

other vital infrastructure; and 

• Oversaw 145 disposition projects which removed 3.5 million square feet of excess footprint, opened many acres of space for redevelopment, shrank security 

perimeters and reduced deteriorated condition. 

In total, FIRP was funded over $2 billion to address NNSA infrastructure needs 

(averaging about $160 million per year). FIRP was terminated in 2013 in accordance 

with its sunset date of the initial legislation. However, the Office of Safety, Infrastructure & Operations maintains authorities of FIRP. 

Mr. ROGERS. Can you quantify for us how much of the $3.7 billion backlog in deferred maintenance must get fixed directly, and how much is attached to facilities 

that will be torn down? How does NNSA delineate between real, concrete requirements for deferred maintenance dollars at enduring facilities versus requirements 

at excess facilities? 

Mr. MCCONNELL. As of the end of Fiscal Year (FY) 2015, NNSA’s deferred maintenance on operating facilities totaled approximately $2.8 billion. The remaining balance is deferred maintenance on excess facilities and facilities to be excessed within 

ten years. A breakout is provided below. 

NNSA Deferred Maintenance (DM) as of FY 2015 

(dollars in thousands) 

Total DM $3,667,183 

DM on excess facilities $497,216 

DM on facilities to be excess in 10 years $354,920 

Once a facility becomes excess, the majority of deferred maintenance is removed 

because NNSA no longer needs to conduct that maintenance as the facility is no 

longer needed for mission work. However, deferred maintenance will remain and/ 

or accumulate on any systems required to maintain the facility in a safe, shutdown 

condition, such as fire suppression systems. 

Mr. ROGERS. How does NNSA allocate its general maintenance funding? Does it 

choose particular projects, or does it allocate based on a site’s deferred maintenance 

backlog figure? 

Mr. MCCONNELL. To support the annual budget request process, NNSA conducts 

a disciplined programming process by integrating budgets across portfolios to ensure 

maintenance investments are consistent with, and support the other programmatic 

work of the NNSA enterprise. The majority of NNSA’s maintenance work consists 

of recurring day-to-day activities to sustain operations and is therefore not project-
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ized. However, as part of NNSA’s annual planning process, M&O contractors are required to submit requests for maintenance funding, which include: a description of 

the work to be accomplished, including major mission deliverables and programs 

supported; a description of any key work not accomplished and any remaining risk; 

workforce impacts (total FTEs/year); and annual funding requirements. NNSA evaluates these requests, adjusts the annual funding requested as determined by subject 

matter experts, and develops a proposed maintenance allocation for each site. The 

site allocations are subject to change based on decisions made to balance maintenance investments with programmatic priorities during the NNSA programming 

process. 

QUESTIONS SUBMITTED BY MR. COOPER 

Mr. COOPER. What is the cost and safety risk of deferring problems and maintenance, and what are you doing to incentivize addressing and funding routine maintenance before small problems become big problems? 

Mr. SMITH. The primary concern with knowingly deferring maintenance is that a 

major, unforeseen failure could occur. Our top non-negotiables—we call them our 

imperatives—are safety and security. We will protect our people, our communities, 

the materials we are entrusted with, and the environment in which we and our 

friends, neighbors, and communities live. We cannot, and will not, compromise safety and security. Our nation, however, also relies on us to deliver our mission with 

the highest quality products and services. Keeping our facilities and working conditions safe, secure, and operating properly requires ever-increasing operations and 

maintenance funding because the potential disruption to operations and mission 

deliverables is a real concern, as is the likelihood for a substantial increase in costly 

repairs. Additionally, as discussed during my testimony, there are occasional facility 

conditions that place and individual or a group of individuals in a higher risk posture than we would like despite our best efforts to find and correct these conditions. 

Mr. COOPER. What is the cost and safety risk of deferring problems and maintenance, and what are you doing to incentivize addressing and funding routine maintenance before small problems become big problems? 

Dr. MCMILLAN. We manage our infrastructure portfolio centrally at the Laboratory to prioritize investments that minimize risk while accomplishing the mission. 

For example, the safety of our workforce and the public are prioritized over risks 

to mission and schedule. Members of our workforce are strongly committed to the 

national mission, and they can become frustrated if their ability to execute their 

work in support of Laboratory missions is affected by unfortunate or unforeseen infrastructure issues. We plan our maintenance work to emphasize predictive and preventive maintenance in order to limit the need for corrective maintenance within 

the budgets that we are provided by NNSA and our internal site support funds. On 

average, the Laboratory spends 45–50% of our maintenance budget on preventive 

maintenance and the balance on corrective maintenance. The incentive for this approach is simple. We minimize disruptions to work when we can by carefully planning maintenance activities, and coordinating outages at the Laboratory with mission requirements. Corrective maintenance, by definition, is performed after there 

are equipment failures that create disruptions and impacts to the mission. However, 

when maintenance is deferred due to lack of funding, it is just a matter of time before equipment or system failures occur. 

Mr. COOPER. What is the cost and safety risk of deferring problems and maintenance, and what are you doing to incentivize addressing and funding routine maintenance before small problems become big problems? 

Mr. RICCIARDELLI. At the legacy Bannister facility, between 250 and 300 electricians, millwrights, janitors, and laborers were employed full time to maintain the 

1940s vintage facility. Even with that level of effort, deferred maintenance remained 

constant at about $130M. Because facility maintenance projects are largely ‘‘one-ofa-kind,’’ the safety risk is much higher than routine, repeatable production work. 

The plant had good safety performance overall, but the majority of the OSHA-reportable injuries originated from maintenance projects. 

Under the new KCNSC lease model, facility maintenance costs are largely included in the lease payment and an escrow fund is in place to address big ticket 

maintenance needs that will emerge as the facility ages. NNSA provides no labor 

resources to maintain the facility or grounds which is solely the responsibility of the 

landlord. The private owner is incented to maintain the value of the property and 

preserve their overall capital investment independent of our tenancy. 

Mr. COOPER. How does NNSA evaluate the cost-benefit of public-private partnerships over the lifetime of the facility? What lifetime is assumed? 
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General KLOTZ. NNSA evaluates the proposals for compliance with OMB Circulars A–11 and A–94. The lifetime assumed is based on the Government’s planned 

use of the building. 

Mr. COOPER. The total amount of NNSA’s deferred maintenance backlog includes 

maintenance that NNSA does not plan to address for a variety of reasons (i.e., excess facilities). What amount of the deferred maintenance backlog does NNSA actually plan to address over the next five years? What factors are used to determine 

what deferred maintenance will or will not be addressed? 

General KLOTZ. The Fiscal Year (FY) 2017 President’s Budget Request will enable 

NNSA to continue to halt the growth of deferred maintenance. NNSA has a project 

prioritization methodology that prioritizes annual investments by evaluating key 

criteria. Criteria evaluated include deferred maintenance reduction, program requirements, safety and programmatic risk reduction, and increases in operational 

efficiency and/or productivity. 

Mr. COOPER. Is the balance between recapitalization and maintenance appropriate? How do you balance necessary investments for maintenance with requirements to focus and invest in programmatic priorities including life-extension programs? 

General KLOTZ. The balance between maintenance and recapitalization is currently appropriate. NNSA has improved its infrastructure investment strategy by 

using the new budget structure approved by Congress, and enhancing decision-making through the implementation of new program management tools. NNSA also 

began requesting increased funding for Recapitalization and Maintenance projects 

starting in FY 2015. These funding increases are essential steps in decreasing deferred maintenance, arresting the declining state of infrastructure, increasing enterprise productivity, improving safety, eliminating costly compensatory measures, and 

shrinking the NNSA footprint through the disposition of unneeded facilities. To balance maintenance investments with programmatic priorities, NNSA conducts a disciplined programming process integrating budgets across portfolios to ensure maintenance investments are consistent with, and support, the other programmatic work 

of the NNSA enterprise. 

Mr. COOPER. Naval Reactors also has a majority of its facilities dating back to 

Cold War-era with nearly 60% of its facilities now over 50–70-plus years old, however these facilities are not in such a state of disrepair as some of the nuclear complex facilities are. To what do you attribute this difference? 

General KLOTZ. The role of nuclear weapons in our national security strategy is 

widely understood. However, the link between our nation’s nuclear deterrence and 

the NNSA infrastructure that supports it is less well appreciated. As a result, investment in NNSA’s infrastructure has generally not kept pace with the growing 

need to replace Cold War era facilities. Every year, NNSA works to balance the 

needs of all our vital missions with the need to maintain and modernize our infrastructure. Naval Reactors (NR) oversees four government-owned contractor-operated 

Department of Energy sites: Knolls Atomic Power Laboratory; Bettis Atomic Power 

Laboratory; Kenneth A. Kesselring Site; and the Naval Reactors Facility. These facilities’ sole purpose is to support the nuclear Navy and NR provides Federal oversight for all aspects of the sites’ operations. The single mission focus helps NR reconcile priorities and react accordingly when problems emerge due to the state of facilities and infrastructure. NR weighs facility and infrastructure resource decisions 

using the same rigorous process used for making technical resource decisions. NR 

reassesses its resource needs semi-annually and prioritizes these needs so that the 

sites’ facility and infrastructure provide the necessary foundation on which technical 

work can be accomplished to support the nuclear fleet of today and tomorrow. However, NR is not immune to the effects of degrading facilities and infrastructure. For 

example, NR needs to replace the Expended Core Facility in Idaho, which is over 

55 years old, does not meet current standards, and requires recapitalization. Over 

the past 10 years, NR has had to increase management attention and resource allocation to facilities and infrastructure and the trend is expected to continue. 

Mr. COOPER. What incentives does NNSA provide for its M&Os to sufficiently invest in maintenance? Are the proper incentives in place to avoid facilities falling 

into such disrepair until a new facility is required? 

General KLOTZ. As part of our Contractor Performance Evaluation Process 

(CPEP), NNSA incentivizes Management and Operating (M&O) contractors’ performance via award fee. The CPEP process is a uniform, corporate process for evaluating NNSA M&O contractors’ performance. The Fee Determining Official’s (FDO) 

award fee determination is a unilateral decision made solely at the discretion of 

NNSA. M&O contractors are evaluated on maintaining, operating, and modernizing 

DOE/NNSA facilities, infrastructure, and equipment in an effective, energy efficient 

manner as part of the annual CPEP process. Starting in Fiscal Year (FY) 2016, 
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M&O contractors are also evaluated on their progress to halt the growth of deferred 

maintenance and to disposition of unneeded infrastructure and excess hazardous 

materials. The same performance evaluation will continue in FY 2017. 

Mr. COOPER. What improvements in management and safety culture are necessary to avoid some of the problems we are now seeing, with parts of the ceiling 

falling down in some facilities? How did we get to this point? What is the plan to 

ensure that billions of dollars in new investment to recapitalize nuclear complex facilities do not suffer the same fate from lack of maintenance? 

General KLOTZ. NNSA is making improvements in management and safety culture and focusing attention and investments to sustain infrastructure by: 

• Deploying new, risk-informed, data-driven management tools; 

• Increasing funding for maintenance and recapitalization; and 

• Linking award fees to safety and infrastructure performance. 

There is consensus amongst Department of Energy and NNSA stakeholders that 

the current state of NNSA’s infrastructure presents a risk to our strategic deterrent 

and must be addressed with urgency, resources, and focus. To that end, NNSA established the Office of Safety, Infrastructure and Operations in January 2015 to ensure NNSA’s infrastructure needs are adequately represented and necessary investments are made. At the Departmental level, the Secretary of Energy has established 

key groups comprised predominantly of senior career service professionals to sustain 

our current efforts. These groups include: 

• The Laboratory Operations Board (LOB); 

• The Infrastructure Executive Committee; and 

• The Excess Contaminated Facilities Working Group. 

QUESTIONS SUBMITTED BY MR. LARSEN 

Mr. LARSEN. DOE’s Real Property Asset Management contains infrastructure investment benchmarks for maintenance and recapitalization activities. To what extent does NNSA’s fiscal year 2017 budget request and associated Future Years Nuclear Security Program meet these benchmarks? If NNSA’s budget request does not 

meet these benchmarks, please describe why. 

General KLOTZ. The Fiscal Year (FY) 2017 President’s Budget Request is adequate for funding 2017 infrastructure-related activities. 

DOE uses findings from the National Academy of Sciences, Key Performance Indicators for Federal Facilities Portfolios: Federal Facilities Council Technical Report 

Number 147 (Washington, D.C.: 2005). The findings suggest that 2% of Replacement 

Plant Value (RPV) should be invested annually for infrastructure in good condition. 

However, for infrastructure in poorer condition annual investments should be closer 

to 4% of RPV. NNSA’s requested increase in Maintenance and Recapitalization 

funds for FY 2017 would put NNSA’s investment at 3.1% of RPV (up from 2% in 

FY 2015 and 2.5% in FY 2016). During times of constrained budgets, NNSA must 

balance budget limitations and risk across all its vital programs to optimize mission 

results. Although lower than the benchmark, NNSA’s FY 2015 and FY 2016 Maintenance and Recapitalization prioritized infrastructure needs across the NNSA enterprise and invested in numerous, critical infrastructure improvements. The yearover-year investment increase from FY 2014 enabled infrastructure investment 

planning and integration with operations 

The FY 2017 President’s Budget Request will allow NNSA to: 

• Increase investments in recapitalization and maintenance efforts to reduce safety and programmatic risk 

• Transfer the Kansas City Bannister Federal Complex to the private sector for 

redevelopment (this will eliminate 2.93 million square feet of excess facilities) 

• Increase buying power via strategic procurement of common building systems 

across the enterprise (e.g., roofs, HVAC) 

The FY 2017 President’s Budget Request provides a balanced approach to continued NNSA infrastructure investments, as infrastructure is but one consideration in 

a broader portfolio of NNSA programmatic requirements. 

Mr. LARSEN. NNSA is currently taking action to improve data needed to better 

prioritize infrastructure investment. Please describe the current implementation 

status of the BUILDER system NNSA is using to prioritize infrastructure investments. When fully implemented, please describe how the BUILDER system will 

allow NNSA to prioritize and oversee deferred maintenance investments while also 

allowing management and operating contractors the ability to complete needed work 

in a timely manner. 

General KLOTZ. NNSA’s deployment of BUILDER is a three-year effort, occurring 

from FY 2015–FY 2018. It involves data for approximately 6,000 assets which will 
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include more than one million systems, components and sub-components. Progress 

to date includes: 

• Migration of all current inventory and condition data; 

• A peer review of all migrated data to ensure quality and consistency; and 

• Development of an NNSA-specific Functionality Module, which measures a 

building’s suitability to function as intended and required for the mission. 

By early 2018, NNSA will complete the following activities: 

• Conduct physical assessments of remaining systems to populate inventory and 

condition data gaps; 

• Perform Functionality Assessments; 

• Integrate BUILDER into the infrastructure planning process; 

• Calculate Deferred Maintenance, Repair Needs, and Replacement Plant Value 

using BUILDER and develop business rules; 

• Develop an online NNSA BUILDER training; and 

• Initiate the integration of BUILDER with site computerized maintenance management systems. 

Full implementation and sustainment of BUILDER will be achieved by early 

2018. Upon full implementation, NNSA will continue working to integrate each 

site’s computerized maintenance management system with BUILDER to achieve 

long-term sustainment. BUILDER is a web based software tool to help decide when, 

where, and how to best maintain, repair, and recapitalize infrastructure. Developed 

by the U.S. Army Corps of Engineers, BUILDER has been recognized by the National Academy of Sciences as a best-in-class practice for infrastructure management. BUILDER uses preexisting engineering data to predict facility and component 

conditions, prioritize maintenance work, and support analysis of different spending 

scenarios. BUILDER is the center of our risk-informed, data-driven infrastructure 

investment strategy. Our plan is to use BUILDER to: 

• Describe the condition of NNSA’s infrastructure, the gaps in NNSA’s infrastructure, and the risk to programs; 

• Document the resources needed to restore and then sustain NNSA infrastructure; 

• Determine the right projects to execute; 

• Guide site maintenance plans; and 

• Help to identify AMPs Asset Management Programs (AMP) like the Roof AMP 

(RAMP) and the Cooling and Heating AMP (CHAMP). 

Mr. LARSEN. What does NNSA spend annually on surveillance and maintenance 

of excess facilities that will be transferred to EM in the future for D&D? How are 

these costs incorporated into NNSA’s estimate of deferred maintenance? 

General KLOTZ. In Fiscal Year (FY) 2016 NNSA invested roughly $30 million on 

the surveillance and maintenance of excess facilities that are known or suspected 

to meet the criteria for transfer to DOE’s Office of Environmental Management 

(EM). Investments in surveillance and maintenance are made to address deferred 

maintenance and prevent deferred maintenance from accumulating. Once a facility 

becomes excess, the majority of deferred maintenance is removed from the backlog 

because NNSA no longer needs to conduct that maintenance as the facility is no 

longer needed for mission work. However, deferred maintenance will remain and/ 

or accumulate on any systems required to maintain the facility in a safe, shutdown 

condition, such as fire suppression systems. 

Mr. LARSEN. How does NNSA decide which excess facilities to transfer to EM 

first? Are risks and costs prominently factored into such decision-making so that annual maintenance costs, as well as lifecycle cleanup costs, can be minimized? 

General KLOTZ. NNSA has evaluated its excess facilities to determine those that 

pose the greatest risk and have identified several higher risk facilities we believe 

meet EM’s conditions for transfer. However, EM is currently facing many competing 

regulatory and other compliance obligations, and performance challenges in some 

areas. As a result, EM is unable to D&D all of the excess facilities already transferred from other Program Secretarial Offices (PSOs) in a timely manner or to take 

in additional excess contaminated facilities from other PSOs in the foreseeable future. Until EM accepts an excess contaminated facility into its portfolio, the PSO 

is responsible for maintaining the excess facility in a safe condition. The information 

gathered by NNSA informed the recent effort by the Excess Contaminated Facilities 

Working Group (ECFWG) which is finalizing a report to Congress on its work, the 

Plan for Deactivation and Decommissioning of Nonoperational Defense Nuclear Facilities report to Congress. NNSA’s highest risk facilities are being prepared for 

transfer, but are not ready yet. NNSA’s primary concern continues to be the risk 

posed by these facilities to the public, workers, and the mission. Minimizing that 

risk in these facilities requires continual surveillance and maintenance. 
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Mr. LARSEN. What is the status of DOE’s Excess Contaminated Facilities Working 

Group, and what are the key findings/recommendations from the group? 

General KLOTZ. The Excess Contaminated Facilities Working Group (ECFWG) developed and executed an enterprise-wide data collection effort to obtain updated cost 

and risk assessments to deactivate, decontaminate, decommission, and demolish excess facilities. The updated data from the working group was used to define the 

scope of the challenge and to identify options for how DOE may better prioritize excess facilities. The ECFWG is developing policies to institutionalize a corporate approach, and updating and validating data gathered by the working group’s efforts. 

The group also is finalizing a report to Congress on its work, the Plan for Deactivation and Decommissioning of Nonoperational Defense Nuclear Facilities. 

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