MODERNIZING THE 

NUCLEAR SECURITY 

ENTERPRISE

Observations on the 

Organization and 

Management of the National 

Nuclear Security 

Administration 

Statement of Gene Aloise, Director 

Natural Resources and Environment

Testimony 

Before the Subcommittee on Strategic 

Forces, Committee on Armed Services, 

House of Representatives

For Release on Delivery 

Expected at 3:30 p.m. EDT

Wednesday, June 27, 2012

GAO-12-867T

United States Government Accountability Office

GAO
United States Government Accountability Office

Highlights of GAO-12-867T, a testimony 

before the Subcommittee on Strategic Forces, 

Committee on Armed Services, House of 

Representatives

July 27, 2012

MODERNIZING THE NUCLEAR SECURITY 

ENTERPRISE

Observations on the Organization and Management 

of the National Nuclear Security Administration

Why GAO Did This Study

During the late 1990s, DOE had 

difficulties with a lack of clear 

management authority and 

responsibility that contributed to 

security problems at the nation’s 

nuclear weapons laboratories and 

management problems with major 

projects. In response, Congress 

created NNSA as a separately 

organized agency within DOE under 

the NNSA Act. NNSA is responsible for 

managing nuclear weapon- and 

nonproliferation-related national 

security activities in laboratories and 

other facilities, collectively known as 

the nuclear security enterprise. GAO 

continues to identify problems across 

the nuclear security enterprise, from 

projects’ cost and schedule overruns to 

inadequate oversight of safety and 

security at NNSA’s sites. With NNSA 

proposing to spend tens of billions of 

dollars to modernize its facilities, it is 

important to ensure scarce resources 

are spent in an effective and efficient 

manner.

This testimony addresses (1) NNSA’s 

early experiences organizing and 

operating as a separately organized 

agency within DOE and (2) NNSA’s 

efforts to correct long-standing 

management deficiencies. It is based 

on prior GAO reports issued from 

January 1995 to March 2012.

DOE and NNSA continue to act on the 

numerous recommendations GAO has 

made to improve NNSA’s 

management. GAO will continue to 

monitor DOE’s and NNSA’s 

implementation of these 

recommendations.

What GAO Found

After the enactment of Title 32 of the National Defense Authorization Act for 

Fiscal Year 2000 (NNSA Act), the Department of Energy (DOE) and the National 

Nuclear Security Administration (NNSA) struggled to determine how NNSA 

should operate as a separately organized agency within the department. A 

number of factors contributed to this. First, DOE and NNSA did not have a useful 

model to follow for establishing a separately organized agency in DOE. Several 

federal agencies were suggested as models, such as the National Oceanic and 

Atmospheric Administration in the Department of Commerce. However, GAO 

reported in January 2007 that agency officials GAO interviewed did not consider 

their agency to be separately organized or believed that their agency’s 

operational methods were transferable to NNSA. Second, DOE’s January 2000 

plan to implement the NNSA Act did not define how NNSA would operate as a 

separately organized agency within DOE. Internal DOE opposition to the creation 

of NNSA led the department to fill virtually every significant statutory position in 

NNSA with DOE officials (i.e., having DOE officials contemporaneously serve in 

NNSA and DOE positions). As GAO testified in April 2001, this practice of “dualhatting” caused considerable concern about NNSA’s ability to independently 

function. Also, lack of formal agreement between DOE and NNSA in a number of 

key areas such as, among others, budgeting and procurement, led to 

organizational conflicts that inhibited effective operations. Even where formal 

procedures were developed, interpersonal disagreements hindered effective 

cooperation. For example, a January 2007 GAO report described the conflict 

between NNSA and DOE counterintelligence offices, which led to Congress 

subsequently amending the NNSA Act to consolidate the counterintelligence 

programs of DOE and NNSA under DOE.

NNSA has made considerable progress resolving some of its long-standing 

management deficiencies, but significant improvement is still needed especially 

in NNSA’s management of its major projects and contracts. GAO reported in 

June 2004 that NNSA has better delineated lines of authority and has improved 

communication between its headquarters and site offices. In addition, NNSA’s 

establishment of an effective headquarters security organization has made 

significant progress resolving many of the security weaknesses GAO has 

identified. Nevertheless, NNSA continues to experience major cost and schedule 

overruns on its projects, such as research and production facilities and nuclear 

weapons refurbishments, principally because of ineffective oversight and poor 

contractor management. In some areas, NNSA can be viewed as a success. 

Importantly, NNSA has continued to ensure that the nuclear weapons stockpile 

remains safe and reliable in the absence of underground nuclear testing. At the 

same time, NNSA’s struggles in defining itself as a separately organized agency 

within DOE, and the considerable management problems that remain have led to 

calls in Congress and other organizations to increase NNSA’s independence 

from DOE. However, senior DOE and NNSA officials have committed to 

continuing reform, and DOE’s and NNSA’s efforts have led to some management 

improvements. As a result, GAO continues to believe, as it concluded in its 

January 2007 report, that drastic organizational change to increase 

independence is unnecessary and questions whether such change would solve 

the agency’s remaining management problems.

View GAO-12-867T. For more information, 

contact Gene Aloise at (202) 512-3841 or 

aloiseg@gao.gov.
 

Page 1 GAO-12-867T 

Chairman Turner, Ranking Member Sanchez, and Members of the 

Subcommittee:

We are pleased to be here today to discuss the creation and 

implementation of the National Nuclear Security Administration (NNSA)—

a separately organized agency within the Department of Energy (DOE).

As you know, NNSA is responsible for the management and security of 

the nation’s nuclear weapons, nuclear nonproliferation, and naval reactor 

programs at research and development laboratories, production plants, 

and other facilities known collectively as the nuclear security enterprise.1

During the late 1990s, DOE experienced management difficulties with its 

nuclear weapons program that contributed to security problems at the 

nation’s nuclear weapons laboratories and significant cost overruns on 

major projects. According to a June 1999 report by the President’s 

Foreign Intelligence Advisory Board, DOE’s management of the nuclear 

weapons laboratories, while representing “science at its best,” also 

embodied “security at its worst” because of “organizational disarray, 

managerial neglect, and...a culture of arrogance.” The board urged 

Congress to create a new organization that, whether established as an 

independent agency or a semiautonomous agency within DOE, would 

have a clear mission, streamlined bureaucracy, and drastically simplified 

lines of authority and accountability. Responding to the board’s 

recommendations, Congress created NNSA under Title 32 of the National 

Defense Authorization Act for Fiscal Year 2000—the NNSA Act.2

The NNSA Act established NNSA as a “separately organized agency” 

within DOE. The act established the position of DOE Under Secretary for 

Nuclear Security, who was also designated as the Administrator of NNSA. 

The Secretary of Energy and the Deputy Secretary of Energy were 

allowed to establish policy for NNSA and to give direction to NNSA 

through the Administrator; however, other DOE employees were 

 

1 Specifically, NNSA manages three national nuclear weapon design laboratories—

Lawrence Livermore National Laboratory in California, Los Alamos National Laboratory in 

New Mexico, and Sandia National Laboratories in New Mexico and California. It also 

manages four nuclear weapons production plants—the Pantex Plant in Texas, the Y-12 

National Security Complex in Tennessee, the Kansas City Plant in Missouri, and the 

Tritium Extraction Facility at DOE’s Savannah River Site in South Carolina. NNSA also 

manages the Nevada National Security Site, formerly known as the Nevada Test Site. 

2 Pub. L. No. 106-65, 113 Stat. 512, 953 (1999). 

 
 

Page 2 GAO-12-867T 

prohibited from directing the activities of individual NNSA employees. In 

addition, the NNSA Act required that, among other things, NNSA develop 

a planning, programming, and budgeting process to ensure that NNSA 

operated under sound financial management principles. Using this 

planning, programming, and budgeting process, NNSA is also required to 

annually submit to Congress a Future Years Nuclear Security Program 

(FYNSP) plan that details NNSA’s planned expenditures for the next 5 

years.

DOE’s and NNSA’s management of the nuclear security enterprise has 

been the subject of much criticism. The department’s problems are longstanding. For example, we first designated DOE’s management of its 

contracts as an area at high risk of fraud, waste, abuse, and 

mismanagement in 1990 because of the department’s record of 

inadequate management and oversight of its contractors. In January 

1995, we reported that DOE’s laboratories did not have clearly defined 

missions that focus their considerable resources on accomplishing the 

department’s changing objectives and national priorities.3

NNSA’s creation, however, has not yet had the desired effect of fully 

resolving these management problems. Progress has been made, but 

NNSA and DOE’s Office of Environmental Management remain on our 

high-risk list.

Noting that the 

laboratories have made vital contributions to the nation’s defense and 

civilian science and technology efforts, we reported that DOE had not 

coordinated these laboratories’ efforts to solve national problems but had 

instead managed each laboratory on a program-by-program basis. The 

establishment of NNSA as a semiautonomous agency within DOE in 

2000 was intended to correct these long-standing and widely recognized 

DOE management problems, which had been underscored by significant 

cost overruns on major projects and security problems at the national 

laboratories.

4

 

3 GAO, Department of Energy: National Laboratories Need Clearer Missions and Better 

Management, 

Furthermore, we continue to identify problems across the 

nuclear security enterprise, ranging from significant cost and schedule 

overruns on major projects to ineffective federal oversight of safety and 

GAO/RCED-95-10 (Washington, D.C.: Jan. 27, 1995). 

4 GAO, High-Risk Series: An Update, GAO-11-278 (Washington, D.C.: February 2011). 
 

Page 3 GAO-12-867T 

security at NNSA’s sites.5

In January 2007, we testified before this Subcommittee on the extent to 

which NNSA has taken steps to improve security at its facilities, improve 

its management practices, and revise its organizational structure.

Concerns have also been raised by national 

laboratory and other officials that DOE’s and NNSA’s oversight of the 

laboratories’ activities has been excessive and that the safety and 

security requirements the laboratories’ are subject to are overly 

prescriptive and burdensome, which has resulted in a negative effect on 

the quality of science performed at these laboratories.

6

Similarly, in February 2012, we testified before this Subcommittee on 

NNSA’s management of the nuclear security enterprise.7 My testimony 

today, which is based on these and other reports and testimonies we 

have issued since NNSA’s creation, discusses (1) NNSA’s early 

experiences organizing and operating as a separately organized agency 

within DOE and (2) NNSA’s efforts to correct long-standing management 

deficiencies. Detailed information about scope and methodology can be 

found in our issued reports. We conducted the performance audit work 

that supports this statement in accordance with generally accepted 

government auditing standards. Those standards require that we plan 

and perform audits to obtain sufficient, appropriate evidence to provide a 

reasonable basis for our findings and conclusions based on our audit 

objectives. We believe that the evidence obtained provides a reasonable 

basis for our findings and conclusions based on our audit objectives.

 

5 GAO, Department of Energy: Views on the Progress of the National Nuclear Security 

Administration in Implementing Title 32, GAO-01-602T (Washington, D.C.: Apr. 4, 2001); 

GAO, NNSA Management: Progress in the Implementation of Title 32, GAO-02-93R

(Washington, D.C.: Dec. 12, 2001); and GAO, Department of Energy: NNSA Restructuring 

and Progress in Implementing Title 32, GAO-02-451T (Washington, D.C.: Feb. 26, 2002). 

6 GAO, National Nuclear Security Administration: Security and Management 

Improvements Can Enhance Implementation of the NNSA Act, GAO-07-428T

(Washington, D.C.: Jan. 31, 2007). 

7 GAO, National Nuclear Security Administration: Observations on NNSA’s Management 

and Oversight of the Nuclear Security Enterprise, GAO-12-473T (Washington, D.C.: Feb. 

16, 2012).
 

Page 4 GAO-12-867T 

DOE is responsible for a diverse set of missions, including nuclear 

security, energy research, and environmental cleanup. These missions 

are managed by various organizations within DOE and largely carried out 

by contractors at DOE sites. According to federal budget data, NNSA is 

the largest organization in DOE, overseeing nuclear weapons, nuclear 

nonproliferation, and naval reactors missions at its sites. With a $10.5 

billion budget in fiscal year 2011—nearly 40 percent of DOE’s total 

budget—NNSA is responsible for, among other things, providing the 

United States with safe, secure, and reliable nuclear weapons in the 

absence of underground nuclear testing and maintaining core 

competencies in nuclear weapons science, technology, and engineering. 

Ensuring that the nuclear weapons stockpile remains safe and reliable in 

the absence of underground nuclear testing is extraordinarily complicated 

and requires state-of-the-art experimental and computing facilities, as well 

as the skills of top scientists in the field. Over the past decade, the United 

States has invested billions of dollars in sustaining the cold war-era 

stockpile and upgrading the laboratories and, in 2011, the administration 

announced plans to request $88 billion from Congress over the next 

decade to operate and modernize the nuclear security enterprise and 

ensure that base scientific, technical, and engineering capabilities are 

sufficiently supported, and the nuclear deterrent in the United States can 

continue to be safe, secure, and reliable.

Under DOE’s long-standing model of having unique management and 

operating (M&O) contractors at each site, management of its sites has 

historically been decentralized and, thus, fragmented. Since the 

Manhattan Project produced the first atomic bomb during World War II, 

NNSA, DOE, and their predecessor agencies have depended on the 

expertise of private firms, universities, and others to carry out research 

and development work and efficiently operate the facilities necessary for 

the nation’s nuclear defense. DOE’s relationship with these entities has 

been formalized over the years through its M&O contracts—agreements 

that give DOE’s contractors unique responsibility to carry out major 

portions of DOE’s missions and apply their scientific, technical, and 

management expertise.8

 

8 M&O contracts are agreements under which the government contracts for the operation, 

maintenance, or support, on its behalf, of a government-owned or -controlled research, 

development, special production, or testing establishment wholly or principally devoted to 

one or more of the major programs of the contracting federal agency. Federal Acquisition 

Regulation, 48 C.F.R. § 17.601. 

Background 
 

Page 5 GAO-12-867T 

Currently, DOE spends 90 percent of its annual budget on M&O 

contracts, making it the largest non-Department of Defense contracting 

agency in the government. The M&O contractors at DOE’s NNSA sites 

have operated under DOE’s direction and oversight but largely 

independently of one another. Various headquarters and field-based 

organizations within DOE and NNSA develop policies, and NNSA site 

offices, collocated with NNSA’s sites, conduct day-to-day oversight of the 

M&O contractors and evaluate the contractors’ performance in carrying 

out the sites’ missions.

NNSA focused considerable attention on reorganizing its internal 

operations; however, it and DOE have struggled with establishing how 

NNSA should operate as a separately organized agency within the 

department. Several factors contributed to this situation. First, DOE and 

NNSA did not have a useful model to follow for establishing a separately 

organized agency in DOE. The President’s Foreign Intelligence Advisory 

Board’s June 1999 report suggested several federal agencies, such as 

the National Oceanic and Atmospheric Administration in the Department 

of Commerce, which could be used as a model for NNSA. However, as 

we reported in January 2007, none of the agency officials we interviewed 

considered their agency to be separately organized or believed that their 

agency’s operational methods were transferable to NNSA.9

 

9 GAO, National Nuclear Security Administration: Additional Actions Needed to Improve 

Management of the Nation’s Nuclear Programs, 

Second, 

DOE’s January 2000 implementation plan, which was required by the 

NNSA Act, did not define how NNSA would operate as a separately 

organized agency within DOE. Instead, reflecting the opposition of the 

then DOE senior leadership to the creation of NNSA, the implementation 

plan “dual-hatted” virtually every significant statutory position in NNSA 

with DOE officials (i.e., having DOE officials contemporaneously serve in 

NNSA and DOE positions), including the Director of NNSA’s Office of

Defense Nuclear Counterintelligence and General Counsel. As we 

testified in April 2001, this practice caused considerable concern about 

NNSA’s ability to function with the independence envisioned in the NNSA 

GAO-07-36 (Washington, D.C.: Jan. 19, 

2007). We interviewed agency officials from the Department of Commerce’s National 

Oceanic and Atmospheric Administration, the Defense Advanced Research Projects 

Agency, the Defense Threat Reduction Agency, and the Department of Transportation’s 

Federal Aviation Administration.

DOE and NNSA 

Struggled to 

Determine How 

NNSA Should Operate 

as a Separately 

Organized Agency
 

Page 6 GAO-12-867T 

Act.10 Dual-hatting was subsequently forbidden by an amendment to the 

NNSA Act.11

A lack of formal agreement between DOE and NNSA in a number of key 

areas—budgeting, procurement, information technology, management 

and administration, and safeguards and security—resulted in 

organizational conflicts that inhibited effective operations. Even where 

formal procedures were developed, interpersonal disagreements 

hindered effective cooperation. For example, our January 2007 report 

described the conflict between NNSA and DOE counterintelligence 

offices.12 Specifically, NNSA and DOE counterintelligence officials 

disagreed over (1) the scope and direction of the counterintelligence 

program, (2) their ability to jointly direct staff in the headquarters 

counterintelligence program offices, (3) the allocation of 

counterintelligence resources, (4) counterintelligence policy making and 

(5) their roles and responsibilities in handling specific counterintelligence 

matters. Subsequently, Congress amended the NNSA Act to consolidate 

the counterintelligence programs of DOE and NNSA under the 

Department of Energy.13

These persistent challenges defining NNSA’s role as a separately 

organized agency have led to calls in Congress and other organizations 

to enhance NNSA’s ability to operate independently of DOE. For 

example, the Defense Science Board proposed in 2006 that a completely 

independent nuclear weapons agency be created.14

 

10

DOE’s Office of 

Inspector General has also recently questioned the relationship between 

DOE and NNSA. Specifically, in November 2011, DOE’s Office of 

Inspector General reported that NNSA, as a result of its separately 

GAO-01-602T 

11 Pub. L. 106-398, § 3157 (2000) (codified at 50 U.S.C. § 2410).

12 GAO-07-36. 

13 Section 3117 of the John Warner National Defense Authorization Act for Fiscal Year 

2007 contained provisions to temporarily consolidate the counterintelligence programs of 

DOE and NNSA under the Department of Energy. Pub. L. No. 109-364, § 3117 (2006). In 

2009, Congress made this consolidation permanent. Pub. L. No. 111-84, § 3121 (2009).

14 The Defense Science Board provides the Department of Defense with independent 

advice and recommendations on matters relating to the department’s scientific and 

technical enterprise See Defense Science Board Task Force, Nuclear Capabilities

(Washington, D.C.: December 2006).
 

Page 7 GAO-12-867T 

organized status, maintains a costly set of distinctly separate overhead 

and indirect cost operations that often duplicate existing DOE functions.15

For example, NNSA retains separate functions in areas such as, among 

others, congressional affairs, general counsel, human resources, 

procurement and acquisition, and public affairs. According to this 

November 2011 report, these redundant operations are costly and can 

complicate communications and program execution. There have been 

continuing calls for removing NNSA from DOE and establishing it as a 

separate agency. We reported in January 2007 that former senior DOE 

and NNSA officials with whom we spoke generally did not favor removing 

NNSA from DOE; we concluded that such drastic change was 

unnecessary to produce an effective organization.16

Since its creation, NNSA has made considerable progress resolving 

some of its long-standing management deficiencies. For example, we 

reported in June 2004 that NNSA had better delineated lines of authority 

and improved communication between NNSA headquarters and its site 

offices.17

 

15 DOE Office of Inspector General, Special Report: Management Challenges at the 

Department of Energy, DOE/IG-0858 (Washington, D.C.: November 2011).

Furthermore, our January 2007 report contained 21 

recommendations to the Secretary of Energy and the Administrator of 

NNSA that were intended to correct deficiencies in five areas—

organization, security, project management, program management, and 

financial management. DOE and NNSA have taken important steps to 

address most of these recommendations. For example, to improve 

security, we recommended that the Administrator of NNSA, among other 

things, implement a professional development program for security staff 

to ensure the completion of needed training, develop a framework to 

evaluate results from security reviews and guide security improvements, 

and establish formal mechanisms for sharing and implementing lessons 

learned across the weapons complex. NNSA’s establishment of an 

effective headquarters security organization has made significant 

progress implementing these recommendations by performing security 

16 GAO-07-36

17 GAO, National Nuclear Security Administration: Key Management Structure and 

Workforce Planning Issues Remain as NNSA Conducts Downsizing, GAO-04-545

(Washington, D.C.: June 25, 2004).

NNSA Has Made 

Considerable 

Improvements, but 

Deficiencies Persist, 

Especially in 

Management of Major 

Projects and 

Contracts 
 

Page 8 GAO-12-867T 

reviews, developing security performance measures, and instituting a 

security lessons-learned center.

Nevertheless, NNSA continues to experience significant deficiencies, 

particularly in its management of major projects and contracts. As we 

testified in February 2012, a basic tenet of effective management is the 

ability to complete projects on time and within budget.

18 However, for 

more than a decade, NNSA has continued to experience significant cost 

and schedule overruns on its major projects, principally because of 

ineffective oversight and poor contractor management. We have reported 

that NNSA’s efforts to extend the operational lives of nuclear weapons in 

the stockpile have experienced cost increases and schedule delays, such 

as a $300 million cost increase and 2-year delay in the refurbishment of 

the W87 nuclear warhead and a $70 million cost increase and 1-year 

delay in the refurbishment of the W76 nuclear warhead.19 Furthermore, 

we reported that the estimated cost to construct a modern Uranium 

Processing Facility at NNSA’s Y-12 National Security Complex 

experienced a nearly sevenfold cost increase from between $600 million 

and $1.1 billion in 2004 to between $4.2 billion and $6.5 billion in 2011.20

We also reported in March 2012 that NNSA’s project to construct a new 

plutonium research facility at Los Alamos National Laboratory—the 

Chemistry and Metallurgy Research Replacement Nuclear Facility—

would cost between $3.7 billion and $5.8 billion—nearly a sixfold increase 

from NNSA’s original estimate.21

NNSA’s planning, programming, and budgeting process has also 

experienced a setback, which raises questions about the process’s 

NNSA’s February 2012 decision to defer 

construction of this facility for at least 5 years will result in a total delay of 

between 8 and 12 years from its original plans.

 

18 GAO-12-473T. 

19 GAO, Nuclear Weapons: Improved Management Needed to Implement Stockpile 

Stewardship Program Effectively, GAO-01-48 (Washington, D.C.: Dec. 14, 2000) and 

GAO, Nuclear Weapons: NNSA and DOD Need to More Effectively Manage the Stockpile 

Life Extension Program, GAO-09-385 (Washington, D.C.: Mar. 2, 2009).

20 GAO, Nuclear Weapons: National Nuclear Security Administration’s Plans for Its 

Uranium Processing Facility Should Better Reflect Funding Estimates and Technology 

Readiness, GAO-11-103 (Washington, D.C.: Nov. 19, 2010).

21 GAO, Modernizing the Nuclear Security Enterprise: New Plutonium Research Facility at 

Los Alamos May Not Meet All Mission Needs, GAO-12-337 (Washington, D.C.: Mar. 26, 

2012). 
 

Page 9 GAO-12-867T 

capability and flexibility. Specifically, NNSA’s modernization and 

operations plans are detailed and annually updated in the agency’s 

Stockpile Stewardship and Management Plan (SSMP), which provides 

details of nuclear security enterprise modernization and operations plans 

over the next two decades. In addition, as discussed above, the NNSA 

Act requires NNSA to annually submit to Congress an FYNSP—a budget 

document approved by the Office of Management and Budget that details 

NNSA’s planned expenditures for the next 5 years. Furthermore, Section 

1043 of the National Defense Authorization Act for Fiscal Year 2012 

requires the Department of Defense and NNSA to jointly produce an 

annual report that, among other things, provides a detailed 10-year 

estimate of modernization budget requirements. NNSA neither submitted 

an FYNSP based on “programmatic requirements”22 nor the Section 1043 

annual report with its fiscal year 2013 budget submission. In addition, 

NNSA has yet to release an updated SSMP. According to the Secretary 

of Energy, the August 2011 Budget Control Act created “new fiscal 

realities” that have caused the agency to revise its long-range 

modernization and operations plans and budget.23

In conclusion, producing a well-organized and effective agency out of 

what was widely considered a dysfunctional enterprise has been a 

considerable challenge. In some areas, NNSA can be viewed as a 

success. In particular, NNSA has successfully ensured that the nuclear 

An NNSA official told 

us that the revised plans, which will include the FYNSP, Section 1043 

annual report, and updated SSMP should be completed in July 2012. We 

are currently reviewing NNSA’s planning, programming, and budgeting 

process in response to a request from the Subcommittee on Energy and 

Water Development, Senate Committee on Appropriations, and we 

expect to issue a report on this work in the next few months.

 

22 The NNSA fiscal year 2013 budget submission said that future year funding levels 

based on actual programmatic requirements will be produced a later date. 

23 The Budget Control Act of 2011, amending the Balanced Budget and Emergency Deficit 

Control Act of 1985, establishes limits on discretionary spending for fiscal years 2012 

through 2021. In addition, the act specifies additional limits on discretionary spending and 

automatic reductions in direct spending because legislation was not enacted that would 

reduce projected deficits by at least $1.2 trillion by the end of fiscal year 2021. Among 

other things, the Budget Control Act requires the Office of Management and Budget to 

calculate, and the President to order, a sequestration of discretionary and direct spending 

on January 2, 2013, to achieve reductions for that fiscal year. See GAO, Agency 

Operations: Agencies Must Continue to Comply with Fiscal Laws Despite the Possibility of 

Sequestration, GAO-12-675T (Washington, D.C.: Apr. 25, 2012). 
 

Page 10 GAO-12-867T 

weapons stockpile remains safe and reliable in the absence of 

underground nuclear testing, accomplishing this complicated task by 

using state-of-the-art facilities, as well as the skills of top scientists. As we 

testified in February 2012, maintaining government-owned facilities that 

were constructed more than 50 years ago and ensuring M&O contractors 

are sustaining critical human capital skills that are highly technical in 

nature and limited in supply are both difficult undertakings. Careful federal 

oversight over the tens of billions of dollars NNSA proposes to spend to 

modernize nuclear facilities will be necessary to ensure these funds are 

spent in as an effective and efficient manner as possible, especially given 

NNSA’s record of weak management of its major projects.

Over the past decade, we have made numerous recommendations to 

DOE and NNSA to improve their management and oversight practices. 

DOE and NNSA have acted on many of these recommendations and 

have made considerable progress. Nevertheless, enough significant 

management problems remain that prompt some to call for removing 

NNSA from DOE and either moving it to another department or 

establishing it as a separate agency. As we concluded in January 2007, 

however, we do not believe that such drastic changes are necessary, and 

we continue to hold this view today. Importantly, we are uncertain 

whether such significant organizational changes to increase NNSA’s 

independence would produce the desired effect of creating a modern, 

responsive, effective, and efficient nuclear security enterprise. In light of 

the substantial leadership commitment to reform made by senior DOE 

and NNSA officials, and the significant improvements that have already 

been made, we believe that NNSA remains capable of delivering the 

management improvements necessary to be an effective organization, 

and we will continue to monitor NNSA’s progress making these 

improvements.

Chairman Turner, Ranking Member Sanchez, and Members of the 

Subcommittee, this completes my prepared statement. I would be 

pleased to respond to any questions you may have at this time.

If you or your staff members have any questions about this testimony, 

please contact me at (202) 512-3841 or aloisee@gao.gov. Contact points 

for our Offices of Congressional Relations and Public Affairs may be 

found on the last page of this testimony. GAO staff who made key 

contributions to this testimony are Allison Bawden, Ryan T. Coles, 

GAO Contact and 

Staff 

Acknowledgments 
 

Page 11 GAO-12-867T 

Jonathan Gill, and Kiki Theodoropoulos, Assistant Directors, and Patrick 

Bernard, Senior Analyst.

(361431)
This is a work of the U.S. government and is not subject to copyright protection in the 

United States. The published product may be reproduced and distributed in its entirety 

without further permission from GAO. However, because this work may contain 

copyrighted images or other material, permission from the copyright holder may be 

necessary if you wish to reproduce this material separately.
The Government Accountability Office, the audit, evaluation, and 

investigative arm of Congress, exists to support Congress in meeting its 

constitutional responsibilities and to help improve the performance and 

accountability of the federal government for the American people. GAO 

examines the use of public funds; evaluates federal programs and 

policies; and provides analyses, recommendations, and other assistance 

to help Congress make informed oversight, policy, and funding decisions. 

GAO’s commitment to good government is reflected in its core values of 

accountability, integrity, and reliability.

The fastest and easiest way to obtain copies of GAO documents at no 

cost is through GAO’s website (www.gao.gov). Each weekday afternoon, 

GAO posts on its website newly released reports, testimony, and 

correspondence. To have GAO e-mail you a list of newly posted products, 

go to www.gao.gov and select “E-mail Updates.”

The price of each GAO publication reflects GAO’s actual cost of 

production and distribution and depends on the number of pages in the 

publication and whether the publication is printed in color or black and 

white. Pricing and ordering information is posted on GAO’s website, 

http://www.gao.gov/ordering.htm. 

Place orders by calling (202) 512-6000, toll free (866) 801-7077, or 

TDD (202) 512-2537. 

Orders may be paid for using American Express, Discover Card, 

MasterCard, Visa, check, or money order. Call for additional information.

Connect with GAO on Facebook, Flickr, Twitter, and YouTube. 

Subscribe to our RSS Feeds or E-mail Updates. Listen to our Podcasts. 

Visit GAO on the web at www.gao.gov. 

Contact:

Website: www.gao.gov/fraudnet/fraudnet.htm

E-mail: fraudnet@gao.gov

Automated answering system: (800) 424-5454 or (202) 512-7470

Katherine Siggerud, Managing Director, siggerudk@gao.gov, (202) 512-

4400, U.S. Government Accountability Office, 441 G Street NW, Room 

7125, Washington, DC 20548

Chuck Young, Managing Director, youngc1@gao.gov, (202) 512-4800

U.S. Government Accountability Office, 441 G Street NW, Room 7149 

Washington, DC 20548

GAO’s Mission

Obtaining Copies of 

GAO Reports and 

Testimony 

Order by Phone

Connect with GAO

To Report Fraud, 

Waste, and Abuse in 

Federal Programs

Congressional 

Relations 

Public Affairs

Please Print on Recycled Paper.