United States General Accounting Office

GAO Report to Congressional Requesters

June 1997 ENVIRONMENTAL

CLEANUP COSTS

NASA Is Making

Progress in Identifying

Contamination, but

More Effort Is Needed

GAO/NSIAD-97-98

GAO United States

General Accounting Office

Washington, D.C. 20548

National Security and

International Affairs Division

B-276548 

June 27, 1997

The Honorable J. Dennis Hastert

Chairman

The Honorable Thomas Barrett

Ranking Minority Member

Subcommittee on National Security,

 International Affairs, and Criminal Justice

Committee on Government Reform and Oversight

House of Representatives

This report responds to the request of the former Chairman and ranking

minority member that we review the National Aeronautics and Space

Administration’s (NASA) environmental cleanup costs. The report expands

on information provided in our September 1996 testimony on NASA

infrastructure1 and provides an assessment of NASA’s (1) determination of

the extent of contamination it may be responsible for cleaning up and

progress in its cleanup program, (2) cost estimates for accomplishing

cleanup, and (3) efforts to determine whether “potentially responsible

parties” should share in cleanup costs.

Background Like other entities, including federal agencies, NASA must comply with

federal environmental laws, including the Resource Conservation and

Recovery Act (RCRA) of 1976 and the Comprehensive Environmental

Response, Compensation, and Liability Act (CERCLA) of 1980, as amended.

RCRA regulates the generation, transportation, storage, disposal, and

cleanup of hazardous wastes. CERCLA creates a framework for carrying out

cleanups, particularly for sites that have been abandoned and sites that

pose the most severe environmental threat. The Environmental Protection

Agency (EPA) administers RCRA and CERCLA, and it may authorize state

agencies to implement all or part of RCRA responsibility. To carry out its

responsibility, therefore, NASA needs to work with multiple regulators.

In our 1991 report,2

 we stated that NASA had not adequately implemented

its policy to prevent, control, and abate environmental pollution. As a

result of our 1991 report, NASA developed an environmental strategic plan

and established an Environmental Management Division at the

1

NASA Facilities: Challenges to Achieving Reductions and Efficiencies (GAO/T-NSIAD-96-238, Sept. 11,

1996).

2

Environmental Protection: Solving NASA’s Current Problems Requires Agencywide Emphasis

(GAO/NSIAD-91-146, Apr. 5, 1991).

Page 1 GAO/NSIAD-97-98 NASA’s Cleanup Costs
B-276548 

headquarters level. The environmental strategic plan includes a goal of

remediating contaminated sites to protect human health and the

environment as quickly as funds allow. To carry out this plan, NASA uses a

decentralized management approach. Its field facility directors are

responsible for day-to-day environmental matters, including remedial

activities. The Environmental Management Division is the focal point for

environmental matters. In our 1994 follow-up report,3

 we stated that NASA’s

environmental program still lacked implementation schedules and, if

funding levels at that time continued, remedial activities would take longer

than the 20 years NASA had predicted.

On the basis of its March 1996 site inventory, NASA identified 913

potentially contaminated sites at 22 of its field facilities in 10 states (see

fig. 1).4

3

Environmental Management (GAO/NSIAD-94-264R, Sept. 21, 1994).

4

The NASA March 1996 inventory of 913 potentially contaminated sites was updated in August 1996.

The update shows 919 sites. We did not believe that the increase from 913 to 919 significantly changed

the March data; therefore, our analyses are based on the March 1996 inventory.

Page 2 GAO/NSIAD-97-98 NASA’s Cleanup Costs
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Figure 1: Location of NASA Field Facilities Having Potentially Contaminated Sites

Johnson

NASA Industrial Plant

JPL-Gold Stone

JPL-Pasadena

JPL-Edwards

Dryden

Santa Susana

Ames

Ellington

Goddard

Plum Brook

Lewis

Michoud

Yellow Creek

Stennis

Marshall

Kennedy

Wallops 

Main Base 

Wallops 

Island

Langley

White Sands

El Paso

Source: NASA’s hazardous site inventory database, dated March 1996.

Appendixes I, II, and III discuss specific data on NASA’s cleanup costs at

selected facilities (1) owned and operated by NASA, (2) owned by NASA and

operated by a NASA contractor, and (3) owned and operated by a NASA

contractor.

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Results in Brief Although NASA began identifying sites nearly 10 years ago, it did not

complete a comprehensive hazardous site inventory database until 1993.

NASA officials said that they now consider their inventory of 913 potentially

contaminated sites to be about complete. However, the extent of

environmental contamination is not yet fully known, and NASA facilities

have a long way to go to effect cleanup of the contaminated sites. Figure 2

shows the percentage of potentially contaminated sites by cleanup status.

Figure 2: Percentage of Potentially

Contaminated Sites by Cleanup Status

Other

Cleaning

Investigating

No planned action

4%

3%

42%

51%

Source: NASA’s hazardous site inventory database, dated March 1996.

NASA is also in the early stages of determining what it will cost to clean up

those sites that require remediation. However, NASA needs better data

before it can reliably estimate its cleanup cost. NASA headquarters had

estimated its total cleanup costs would be $2 billion to clean up all its

potentially contaminated sites over a 20-year period. It later lowered the

estimate to $1.5 billion by eliminating sites where it believed no further

action was needed. This estimate assumed that all sites of the same type

would cost the same, regardless of variances in the extent of

contamination. At our request, NASA field facilities developed estimates of

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B-276548 

remediation costs totaling $636 million based on actual costs, local quotes,

and input from other federal facilities. However, the field facilities’

estimates excluded some of the 383 sites that had not been studied.

Neither the headquarters nor the field estimates included long-term

operation and maintenance costs5

 or considered NASA’s potential costs for

remediation at its contractor facilities. Furthermore, neither estimate

considered the potential effect of infrastructure changes that could

increase remediation cost. For example, depending on planned future use

after facility closure, regulators could require NASA to clean up to a higher,

more costly residential-use standard rather than the lower, industrial-use

standard currently being applied to NASA facilities. Although NASA’s overall

budget is projected to decline over the next few years, NASA headquarters

is projecting that environmental funding will remain about level in fiscal

year 1998, then increase somewhat over the following 4 years. However,

some field facilities indicated they were planning to request major

environmental funding increases. As a result, NASA will need to consider

how it will prioritize the various funding requests.

CERCLA allows federal agencies and other entities that carry out cleanup

activities to seek cost sharing or cost recovery from the potentially

responsible parties whom the law would hold liable, such as past owners,

operators, and contractors. CERCLA cost recovery can also be available to a

party conducting a cleanup under RCRA corrective action requirements.

Despite the availability of a cost recovery mechanism, NASA headquarters

has not had a policy for determining whether to seek contributions from

other parties. NASA is paying the remediation costs for virtually all of its

field facilities. Except for a few cases involving contractor negligence,

NASA facilities have not identified if there are opportunities for recovering

costs from potentially responsible parties. After we discussed the

preliminary results of our review with NASA officials, they reported that

they are now developing a policy statement addressing the issue of

identifying and pursuing potentially responsible parties where appropriate.

5

Subsequent to our field work, NASA headquarters used a new cost model that considers site

differences, and at least 5 years of long-term operation and maintenance costs. Using preliminary data

in the new model, NASA estimated that the future cleanup cost would be $1.4 billion for an estimated

679 sites potentially requiring remediation.

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Further Investigations

Are Needed to Fully

Determine the Extent

of Contamination and

Cleanup Is Just

Beginning

NASA officials said that their inventory of potentially contaminated sites is

now considered complete; however, further investigations are needed to

determine the extent of required cleanup for most sites. The actual

cleanup of some sites is just beginning.

Extent of Contamination Is

Not Fully Known

In 1988, NASA headquarters began efforts to identify contaminated sites at

most of its facilities.6

 However, a comprehensive hazardous site inventory

database was not completed until 1993. NASA officials said that they have

identified practically all of their potentially contaminated sites. One

exception is the NASA Industrial Plant at Downey, California. The Downey

facility was not part of NASA’s overall inventory effort because the facility

was not disposing of hazardous waste and was not a large generator of

hazardous waste. A recently completed study shows that four of the six

parcels comprising the Downey facility require no remediation. A contract

to study the other two parcels is underway. These two parcels are more

likely to contain contaminated sites, but pending the completion of the

study, the number of such sites will not be known.

Figure 3 shows NASA’s reported number of sites in the cleanup phase or

potentially requiring remediation (447) as well as the number of sites that

have no planned action (466) for each of the NASA field facilities.

6

NASA field facilities have been identifying potentially contaminated sites since the 1980s. For

example, the George C. Marshall Space Flight Center and the Michoud Assembly Facility identified

some sites in the early 1980s, and the John F. Kennedy Space Center identified 21 sites in the

mid-1980s.

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Figure 3: Breakdown of the Number of Sites in the Cleanup Phase or Potentially Requiring Remediation and of Sites Having

No Planned Action Marshall Kennedy

Lewis

Dryden

Johnson

Stennis

Yellow Creek

White Sands

Pasadena

Santa Susana

Ames

Michoud

Edwards

Langley

Goddard

Wallops Main Base

Plum Brook

Wallops Island

Industrial Plant

Ellington

 El Paso

Goldstone

0

50

100

150

200

161

109

78

63 63 61

51

42 41 35 33 33 32 25 23 22 15 12 7 4 2 1

Number of sites

Potential remediation No planned action

Source: NASA’s hazardous site inventory database, dated March 1996.

NASA’s potentially contaminated sites were often identified through various

activities. For example, at the John F. Kennedy Space Center in Florida,

one of the contamination problems was discovered when workers became

ill while digging holes for telephone poles during the late 1980s. At the

Santa Susana Field Laboratory in California, groundwater contamination

Page 7 GAO/NSIAD-97-98 NASA’s Cleanup Costs
B-276548 

problems were discovered during an investigation of site water supply

wells in 1984. At the Langley Research Center in Virginia, contamination of

a creek bed was discovered during a 1988 study of marine life in the area.

Some NASA sites are on the National Priorities List of highly polluted sites

established by EPA under CERCLA. NASA’s Dryden Flight Research Center in

California, the Langley Research Center in Virginia, and the George C.

Marshall Space Flight Center in Alabama have been placed on the list and

are jointly listed with collocated Department of Defense (DOD) sites. The

Jet Propulsion Laboratory in Pasadena, California, is also on the list. The

national priorities designation requires that these sites follow the CERCLA

process during remediation. Other NASA facilities had the choice of

following either CERCLA or RCRA processes to clean up contaminated sites.

NASA states that because the facilities that are being cleaned up have RCRA

permits, RCRA is the cleanup authority it will use.

Cleanup Is in Early Stages

and Estimates for

Completion Are Unreliable

The status of NASA’s potentially contaminated sites is summarized in 

table 1.

Table 1: Status of NASA’s Potentially

Contaminated Sites Status Number Percent

No planned action

Closed without need for remediation 57 6

No further action planneda 200 22

Need inspection upon closure 209 23

Subtotal 466 51

Potential remediation

Remediated or being remediated 31 3

Classified as “other” 33 4

Needing investigation/being investigated 383 42

Subtotal 447 49

Total 913 100

aNASA’s August 1996 update shows that 35 of the 200 sites requiring no further action were

placed in categories requiring further action, therefore reducing the 200 to 165.

The sites with no planned action (466) were sites where there was thought

to be some contamination; however, preliminary reviews of the sites

showed no contamination or a level of contamination within EPA’s

Page 8 GAO/NSIAD-97-98 NASA’s Cleanup Costs
B-276548 

acceptable limits. For example, one site identified from an aerial

observation at the Langley Research Center proved to be simply an area

where vehicles had been washed and not a site containing contamination.

Of the sites NASA classifies as potentially requiring remediation (447), a

large number of sites (383) still require investigating or are being

investigated to evaluate the extent of contamination and the need for

cleanup. NASA headquarters officials said that these investigations are not

scheduled to be completed until the end of 1997, but some field facilities

expect the investigations to be completed later. For example, the Marshall

Space Flight Center is slated to complete its investigations in mid-1998, the

Michoud Assembly Facility in Louisiana does not plan to complete its

investigation until 1999, and the Kennedy Space Center does not expect to

complete its investigation until the end of 1999. Until these investigations

are completed, the type and extent of contamination and the need for

cleanup are uncertain.

Although NASA headquarters estimates a 20-year period for cleaning up

contaminated sites, it is not well-supported. For example, neither it nor its

field facilities have a detailed time schedule for accomplishing the

cleanup. Only 31 contaminated sites, or 3 percent, have been or are being

remediated.

Field facility officials cited other reasons, in addition to the relatively slow

start, for not being further along in the remediation process. For example,

there have been difficulties in dealing with multiple federal and state

agencies and getting them to agree on the level of cleanup necessary. The

Langley Research Center, in its attempts to get concurrence on the level

and method of cleanup required for one of its sites, has been giving data to

a number of different regulators and has been responding to questions

relative to this cleanup for over 8 years. A chronology of correspondence

shows that the regulators and Langley have exchanged over 100

documents during this period.

Page 9 GAO/NSIAD-97-98 NASA’s Cleanup Costs
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Better Data Are

Needed Before

Reliable Cleanup Cost

Estimates Can Be

Made

NASA field facilities reported spending $117 million through fiscal year 1995

for remedial activities, not including management costs.7

 Most of these

funds were used for precleanup activities. Making accurate estimates of

NASA’s additional cleanup cost is not possible because the extent of

contamination for most sites that may require remediation has not been

determined. At the time of our field work, NASA headquarters estimated

that remediation would cost $1.5 billion.8 NASA field facilities provided

estimates totaling $636 million. However, the two estimates are not

comparable. The headquarters’ estimate considers all sites of the same

type to cost the same, regardless of variances in extent of contamination,

and the field facilities’ estimates do not include all potential sites such as

those still being studied. Neither estimate includes all long-term operations

and maintenance costs nor any costs for NASA’s potential remediation

liability at its contractor facilities. The estimates also do not consider

potential effects of infrastructure changes. Any of these costs could

significantly increase the potential remediation cost. Accordingly, it is

likely that NASA will have to make priority decisions on cleanup

expenditures.

Past Expenditures Were

Predominantly for

Precleanup Activities

Rather Than Cleanup

Most of the $117 million spent to date on remedial activities ($83 million)

has been spent on such preliminary activities as investigations or studies.

For example, information provided by the Pasadena facility showed that

all of its expenditures ($11 million) had been spent on precleanup

activities, and information provided by the White Sands Test Facility in

New Mexico showed that virtually all of its expenditures ($28 million) had

been spent on precleanup activities. Only three field facilities—Ames

Research Center in California, Lewis Research Center in Ohio, and

Michoud Assembly Facility in Louisiana—spent more on cleaning up than

on conducting studies and investigations.

7

Management costs include NASA’s cost for personnel who manage the remediation program. DOD

designates such costs as remediation costs, while NASA cannot accurately break out or identify these

costs as remediation.

8

Subsequent to our field work, NASA headquarters, using a new cost model that considers site

differences, estimated that the future cleanup cost would be $1.4 billion for an estimated 679 sites

potentially requiring remediation.

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Accurate Estimates of

Future Cost Are Not

Possible Without Better

Data

NASA’s site inventory, which is maintained by headquarters and updated by

the field facilities, should list cleanup cost estimates developed by each

facility for each of its sites. However, NASA’s inventory contained

site-specific cost estimates for only 19 percent of the sites9

 that may

require remediation because the process of developing such data is in the

early stages at most facilities. Moreover, many of the cost estimates are

only for the early stages of the remediation process and may not include

the total cleanup cost.

Using parts of a DOD cost model, which involved an average cleanup cost

of 17 separate classes of environmental problems, NASA headquarters

developed the remediation estimates used at the time of our field work.

The average cost of the specific class was multiplied by the number of

sites within the class. For example, one contamination class was

“contaminated sediment,” which had an average remediation cost of

$2.7 million per site. Therefore, the model required multiplying the number

of NASA’s contaminated sediment sites by the $2.7 million. NASA said that

the model may have overstated its remediation estimate because most DOD

sites were larger and probably more polluted than NASA sites. According to

NASA officials, the DOD model was the best available approach in 1993.

NASA’s estimate of $1.5 billion was a reduction of $500 million from its

original estimate of $2 billion. The reduction resulted from a NASA

headquarters’ decision to eliminate all sites that are classified as requiring

no further action from the original cost estimate. This reduction appeared

appropriate based on available data.

NASA recognizes that some classes of sites, such as landfills and water

treatment facilities, may require annual operation and maintenance

expenses; however, such costs were not included in NASA headquarters’

estimate of $1.5 billion.10 An example is contaminated groundwater that

may be remediated through a process known as “pump and treat,” where

contaminated water is extracted from the ground, treated, and then

reinjected. This process can be continued for decades, thereby requiring

continued operations and maintenance expenditures. For these sites,

significant post-cleanup costs could last indefinitely. DOD has found that

9

Subsequent to our field work, a NASA headquarters’ contractor, using a new cost model, updated the

site cost estimates to include all sites that NASA expects to clean up. NASA believes that this new

model, when fully implemented, will provide significantly improved cost estimates for its cleanup

costs.

10Included in NASA’s new cost model is an estimate for at least 5 years of operation and maintenance

for those sites that NASA currently projects will require such activities.

Page 11 GAO/NSIAD-97-98 NASA’s Cleanup Costs
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annual operation and maintenance costs can be as high as 25 to 30 percent

of cleanup costs.

To determine if a more reliable cost estimate could be developed, we

visited a number of NASA field facilities and sent requests for data to other

facilities. From data that the field facilities provided, we compiled a total

cost estimate of $636 million for past ($117 million) and future

($519 million) remediation costs.

The field facilities’ estimates were significantly lower than the

headquarters’ estimate. For example, for one of the facilities with the most

potentially contaminated sites (Kennedy Space Center), the headquarters’

estimate of $379.6 million significantly exceeds the facility’s estimate of

$86.2 million. According to Kennedy officials, their estimates are based on

actual costs, local quotes, input from other federal facilities, and

information from the Remedial Action Engineering and Requirements

System, which is an environmental cost estimating system based on

site-specific data. Although the Kennedy estimate may be more accurate

than the headquarters’ estimate for the sites investigated to date, Kennedy

has not yet completed cleaning up any of its sites or investigating many of

its sites and the facility’s estimate only includes sites that are projected for

cleanup through 2002, although remediation is not expected to be

completed until 2008.

Two facilities with fewer sites than Kennedy that are further along in

studying contaminated sites also show a much lower estimate than the

headquarters’ estimate. The Langley Research Center shows a projected

total cleanup cost of $6.2 million compared to the headquarters’ estimate

of $29.3 million, while the Ames Research Center shows a total projected

cleanup cost of $19.6 million compared to the headquarters’ estimate of

$44.2 million.

Although NASA field facilities currently estimate future remediation will

cost $519 million, some facilities are negotiating with federal and/or state

regulators on the extent of cleanup needed. The results of such

negotiations will affect the amount needed for cleanup. For example, the

Langley Research Center has been negotiating with EPA for years on the

level of cleanup for one of its sites. Depending on the level agreed to,

Langley’s cleanup cost for this one site could range from $2 million to

$100 million.

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Figure 4 shows the amount of money that selected field facilities spent

through fiscal year 1995 compared to the amount they expect to spend in

the future.

Figure 4: Amount of Money Spent Through Fiscal Year 1995 Compared to Projected Expenditures

Edwards

Kennedy

Marshall

Pasadena

0 20 40 60 80 100 120

2.5

2.7

3.8

11.2

78

83.5

83.7

92.8

Millions of dollars

Past cost Future cost

Source: NASA’s hazardous site inventory database, dated March 1996.

Potential Costs for

Cleanup at Contractors’

Facilities Could Be

Significant

Other costs not captured in NASA’s remediation cost estimates need to be

considered. For example, NASA has not determined how much it is or could

be paying through overhead charges to clean up contaminated facilities

owned and operated by its contractors or what its potential future cleanup

costs are at contractor-owned sites. To develop such estimates, we sent a

request to 20 of NASA’s largest contractors and asked for (1) NASA payments

to them during the past 2 years for their cleanup costs and (2) their

estimates of future cleanup costs at their facilities.

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Of these 20 contractors, 16 responded. NASA has paid $22 million to clean

up environmental contamination at these contractor plants during the past

2 years through reimbursing contractors’ overhead charges. In terms of

future cleanup costs, these contractors expected such costs to be over

$1 billion. This estimate, however, did not include the costs for NASA’s

largest contractor because it did not provide future costs. That contractor

has NASA contracts worth over $35 billion.

Cost Impact of Potential

Infrastructure Changes Is

Uncertain

An additional uncertainty regarding NASA’s future remediation cost is the

potential impact if any field facilities are closed and cleanup is to a higher

land-use standard. In our September 1996 testimony on NASA

infrastructure,11 we stated that the impact of environmental cleanup

requirements on NASA’s property disposal decisions is not yet well known.

CERCLA requires that the government clean up property before selling or

transferring it to others. Typically, this requires that the future use of the

property be established and cleanup be done in accordance with the

planned use. Most NASA facilities are currently used for industrial activity.

As might be expected, the cleanup standard for industrial use property is

lower than what would be required for residential use. NASA officials

believe that if the agency chooses to dispose of a property, regulators

could require NASA to clean up to a residential use as opposed to an

industrial-use standard. Although field facilities had not prepared actual

cost estimates, about half of the facilities contacted believed that if their

facilities were closed, cleanup costs would increase significantly. For

example, the White Sands Test Facility estimated costs could nearly

double; the Marshall Space Flight Center believed they could triple; and

the Lewis Research Center believed they could quintuple. However,

ultimately the effect of closures on cleanup costs would have to be

decided on a case-by-case basis.

Future Funding Will

Require Priority Decisions

on Cleanup

According to the NASA fiscal year 1998 budget estimate to the Congress,

NASA’s overall budget is projected to decline by nearly 4 percent over the

next 5 years. This decline is even more dramatic when the projected

available funds are adjusted for inflation. In terms of 1997 dollars, the

decline is projected to be over 20 percent over the 5-year period. NASA’s

environmental budget line, which is $33 million for fiscal year 1997, is

currently projected to remain at about the same level in fiscal year 1998,

11NASA Facilities: Challenges to Achieving Reductions and Efficiencies (GAO/T-NSIAD-96-238,

Sept. 11, 1996).

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then increase to an average of about $50 million over the following 4 years.

Considering inflation, this amount will be worth less in later years.

NASA does not separately identify remediation in its environmental budget.

In fiscal years 1993 and 1994, remediation was about 50 percent of the

environmental budget. By 1996, remediation had grown to about 65

percent, and it is expected to remain at that level in the future. Since

NASA’s two facilities with the greatest number of contaminated

sites—Kennedy Space Center and Marshall Space Flight Center—are

intensifying their remediation efforts, it is likely that NASA will have to

prioritize environmental remediation expenditures as remediation efforts

intensify. This is further demonstrated by NASA’s change in the projected

environmental budget for the year 2000, or a decline from $70 million in its

fiscal year 1996 estimate to $52 million in its fiscal year 1998 estimate.

Policy Is Needed to

Determine Whether

Other Parties Should

Be Sharing Cleanup

Costs

Although CERCLA allows NASA to recover cleanup costs from past and

present owners and operators and from other potentially responsible

parties, NASA headquarters has not yet developed an overall policy relating

to determining the potential for recovery of costs. To date, NASA field

facilities have only made limited efforts to determine whether there may

be opportunities to recover cleanup costs. Except for other federal

agencies and a few contractor negligence situations, NASA generally has not

identified whether potentially responsible parties should be sharing costs.

However, field facility officials said that opportunities for doing so may

exist.

Cost Recovery Policy Has

Not Been Developed

Two federal environmental laws, RCRA and CERCLA, require remedial action

to clean up property contaminated with hazardous substances that pose a

threat to health or the environment.12 Both RCRA and CERCLA impose a

responsibility for cleanup on the owner and/or operator of a facility. Under

CERCLA, the party carrying out a cleanup may seek cost reimbursement

from other persons whom the law would hold liable. Persons include past

owners, operators, contractors, and a broad range of other potentially

responsible parties. CERCLA cost recovery can also be available to a party

conducting a cleanup under RCRA.

13

12Which law governs depends on the circumstances, including whether the site is on the National

Priorities List.

1342 U.S.C. 9607(a)(4)(A) allows a federal agency to recover cleanup costs for removal or remedial

actions “not inconsistent with the National Contingency Plan.” EPA regulations on cost recovery are

found in 40 C.F.R. § 300.700(c).

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Despite the potential for cost recovery, NASA has not issued a policy or

guidance to field facilities to govern the recovery of cleanup costs where

appropriate. However, the agency is in the process of drafting a policy

statement requiring the identification of potentially responsible parties

from whom contributions might be sought.

Cost Recovery Efforts to

Date

We noted two situations where NASA identified contractor negligence

resulted in contamination requiring cleanup. In these cases, NASA

recovered some of the cost from the contractors involved. One situation

occurred at the Ames Research Center in 1992. A contractor left a fueling

operation unattended and spilled about 2,500 gallons of jet fuel. NASA

pursued the contractor for negligence and negotiated a recovery of

$204,000 of the cleanup cost from the contractor. In the second situation, a

support services contractor at the Lewis Research Center dumped lead

paint on the ground, resulting in a cleanup bill for Lewis of $100,000. The

entire sum was withheld from the contractor’s payment on its support

services contract.

Another situation where NASA’s cleanup cost is likely to be shared involves

groundwater treatment at NASA’s Ames Research Center. NASA, as a named

party in a record of decision that EPA issued in 1989, is in the process of

finalizing an agreement with other potentially responsible parties,

including private companies operating on adjacent property, that would

require NASA to pay the companies $1.4 million of the estimated

$5.5 million cleanup costs. Thereafter, the private firms, and not NASA,

would pay for and conduct the groundwater cleanup.

NASA Is Paying Costs of

Ongoing Cleanups

During our review, we found a number of other situations in which NASA

has paid or is paying to clean up contamination that involved other parties.

In one example, a 1966 spill of 16,000 gallons of trichloroethylene at the

Michoud Assembly Facility seeped into groundwater and created

significant contamination. NASA has historical records to identify the

contractor that operated the facility at the time of the spill as well as other

contractors on the property at the time. However, a 1993 search of

contract and insurance records from the 1960s did not produce any

contractual documentation. According to Michoud officials, because of the

lack of documentation and because the contamination occurred during the

1960s, NASA will probably not try to recover costs from the past

contractors.

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Another example involves the Kennedy Space Center. Until our review,

Kennedy had not searched for contractors or other responsible parties to

contribute to costs. According to Kennedy officials, the conventional view

has been that, as the owner and operator of its facility, NASA oversees

contractor operations and is, therefore, responsible for any contamination.

As a result of our inquiries, Kennedy’s legal office and Environmental

Management Office officials said that they plan to be more aggressive in

determining whether there are cost recovery opportunities. For example,

Kennedy officials believe that they may be able to obtain reimbursement

for cleanup costs attributable to the actions of a former landowner that

operated a private business on the site that contaminated groundwater.

Kennedy has constructed a water treatment facility ($265,000) that pumps

and treats contaminated groundwater, and it is paying for the operation

and maintenance of the facility ($168,000 a year since 1991). Kennedy

officials said they plan to continue the present cleanup strategy until

contamination is reduced to acceptable levels and, following treatment,

they will attempt to determine whether to pursue the former landowner. In

another case, Kennedy plans to clean up fuel oil contamination that

occurred when a storage tank leaked gasoline or diesel fuel at its visitor’s

center. Cleanup involves removing and aerating soil at the site. At the time

of the contamination, a private company leased the visitor’s center.

Kennedy officials believe that the lessee had control of the situation and

should be held responsible. According to Kennedy officials, the lessee paid

for the remedial investigation at the site before Kennedy assumed control

of the cleanup. Kennedy took over the cleanup because another lessee

now occupies the center. Kennedy’s projected remediation cost for the

visitor’s center is $3.5 million. After the cleanup is completed, Kennedy

will decide whether the former lessee should be asked to reimburse the

government.

The Santa Susana Field Laboratory is another situation where NASA

officials need to decide whether it should pursue cost sharing. NASA owns

some of the land at Santa Susana, but most of the facility is a

contractor-owned and -operated plant. The major problem at the Santa

Susana facility is groundwater contaminated with trichloroethylene. The

contamination, according to a NASA-funded study, occurred primarily in the

1950s as a result of contractor rocket testing for the Air Force. That testing

was carried out by the same contractor that still owns the facility and most

of the land. NASA has paid for groundwater treatment on its property, and it

has tried over the past few years to get the Air Force to pay more of the

cleanup costs. To date, the Air Force has refused, pointing to the

Page 17 GAO/NSIAD-97-98 NASA’s Cleanup Costs
B-276548 

contractor as the party principally responsible for the contamination.

While the debate continues over who should contribute and how much,

NASA is paying the largest portion of the groundwater treatment costs.

Recommendations We recommend that the NASA Administrator

• establish facility-based, implementation schedules for completing cleanup

of contaminated sites;

• estimate probable future costs by (1) identifying all site-specific costs,

including operation and maintenance costs, for sites believed to require

remediation, (2) requesting contractors’ remediation cost estimates for

cleaning up contamination at contractor facilities that could represent

future costs for NASA and taking any necessary contract action to require

such estimates in the future, (3) identifying infrastructure changes, such as

planned property use and applicable cleanup standards that are consistent

with requirements for the Annual Accountability Report, and documenting

the impact of facility closure decisions on environmental cleanup costs;

• prioritize the application of environmental funds in its cleanup efforts; and

• issue a policy statement concerning potentially responsible parties and

cost recovery.

Agency Comments

and Our Evaluation

NASA generally concurred with our recommendations, except for questions

in two areas—(1) requiring contractors to provide remediation cost

estimates for cleaning up contamination at contractor facilities that could

represent future costs for NASA and (2) identifying infrastructure changes,

such as planned property use and applicable cleanup standards, and

documenting the impact of facility closure decisions on environmental

cleanup costs.

NASA said that estimates of contractor cleanup costs that would be

allowable and allocable under future contracts would be speculative. We

agree that such estimates would not be firm, but we believe that even a

preliminary estimate of the total amount NASA could be paying to

contractors in the form of indirect costs would help to provide a more

complete picture of its environmental cleanup costs. As we note in the

report, NASA’s remediation cost estimates do not show the amount that it is

paying through overhead charges to clean up contaminated contractor

facilities or its potential future costs at such facilities. NASA also stated that

it is not clear if it can require contractors to estimate the costs of future

cleanup at contractor facilities. To the extent that existing contracts do

Page 18 GAO/NSIAD-97-98 NASA’s Cleanup Costs
B-276548 

not support such a requirement, we believe that, when an opportunity

arises, NASA should include in its contracts the authority to require

estimates of future cleanup costs. In the meantime, NASA at least needs to

ask contractors for such estimates. All but one of the contractors

responding to our survey provided that information to us, and contractors

also have provided environmental cost estimates to DOD. We have modified

our recommendation accordingly.

NASA agreed that environmental costs need to be identified as soon as

possible but believed our recommendation to identify infrastructure

changes and costs go well beyond requirements to identify costs for its

Annual Accountability Report, using best available data. Our

recommendation did not intend to recommend identifying cost impacts

where changes are not yet planned, so we modified our recommendation

to clarify our intent.

NASA comments are reprinted in full in appendix V. NASA also provided

suggested editorial and technical changes and supplied updated

information. We have incorporated this additional information in the

report where appropriate.

We performed our review from October 1996 through May 1997 in

accordance with generally accepted government auditing standards. The

scope and methodology for our review are discussed in appendix IV.

Unless you publicly announce its contents earlier, we plan no further

distribution of this report until 30 days after its issue date. At that time, we

will make copies available to interested congressional committees; the

Administrators, National Aeronautics and Space Administration and the

Environmental Protection Agency; and the Director, Office of Management

and Budget. We will also make copies available to others on request.

Page 19 GAO/NSIAD-97-98 NASA’s Cleanup Costs
B-276548 

If you have any questions on this report, please call me on (202) 512-8412.

Major contributors to this report are listed in appendix VI.

David R. Warren, Director

Defense Management Issues

Page 20 GAO/NSIAD-97-98 NASA’s Cleanup Costs
Page 21 GAO/NSIAD-97-98 NASA’s Cleanup Costs
Contents

Letter 1

Appendix I 

John F. Kennedy

Space Center

24

Background 24

Extent of Contamination 25

Cost to Clean Up Contamination 27

Cost Sharing Efforts 28

Appendix II 

Michoud Assembly

Facility

30

Background 30

Extent of Contamination 31

Cost to Clean Up Contamination 32

Cost Sharing Efforts 34

Appendix III 

Santa Susana Field

Laboratory

35

Background 35

Extent of Contamination 38

Cost to Clean Up Contamination 40

Cost Sharing Efforts 41

Appendix IV 

Scope and

Methodology

43

Appendix V 

Comments From the

National Aeronautics

and Space

Administration

45

Appendix VI 

Major Contributors to

This Report

51

Tables Table 1: Status of NASA’s Potentially Contaminated Sites 8

Table I.1: Remediation Status of Kennedy’s Sites 26

Page 22 GAO/NSIAD-97-98 NASA’s Cleanup Costs
Contents

Table I.2: Kennedy’s Projected Remediation Costs for Fiscal

Years 1996 Through 2002

28

Table III.1: Remediation Status of NASA-owned Sites 39

Table IV.1: Locations and Organizations Responding to Our Data

Request

44

Figures Figure 1: Location of NASA Field Facilities Having Potentially

Contaminated Sites

3

Figure 2: Percentage of Potentially Contaminated Sites by

Cleanup Status

4

Figure 3: Breakdown of the Number of Sites in the Cleanup Phase

or Potentially Requiring Remediation and of Sites Having No

Planned Action

7

Figure 4: Amount of Money Spent Through Fiscal Year 1995

Compared to Projected Expenditures

13

Figure I.1: Location of the Kennedy Space Center 24

Figure II.1: Location of the Michoud Assembly Facility 30

Figure III.1: Location of the Santa Susana Field Laboratory 36

Abbreviations

CERCLA Comprehensive Environmental Response, Compensation,

and Liability Act

DOD Department of Defense

EPA Environmental Protection Agency

NASA National Aeronautics and Space Administration

RCRA Resource Conservation and Recovery Act

Page 23 GAO/NSIAD-97-98 NASA’s Cleanup Costs
Appendix I 

John F. Kennedy Space Center

Background

Site Description and

Mission

The John F. Kennedy Space Center is a government-owned,

government-operated facility located on the east coast of Florida on

Merritt Island near the Cape Canaveral Air Force Station (see fig. I.1).

Kennedy contains the Merritt Island wildlife preserve and the Cape

Canaveral National Seashore.

Figure I.1: Location of the Kennedy

Space Center

Kennedy

Miami

Jacksonville

Tallahassee

Source: NASA Real Property Locations by Accountable Reporting Installations.

Kennedy is the National Aeronautics and Space Administration’s (NASA)

main facility for launching space vehicles, and it also serves as a landing

site. Kennedy’s role in the space program includes the assembly, checkout,

and launch of payloads and space vehicles. Currently, it is focused on the

Page 24 GAO/NSIAD-97-98 NASA’s Cleanup Costs
Appendix I 

John F. Kennedy Space Center

space shuttle and on preparing for the integration and launch of space

station elements.

Regulatory Process In the 1980s, Kennedy began its remediation process by determining if any

contamination posed hazards to human health or the environment, as

required by the Comprehensive Environmental Response, Compensation,

and Liability Act (CERCLA). Kennedy officials said, however, at that time

there was little or no focus on cleaning up sites. In 1986, Kennedy elected

to proceed with cleanup under the Resource Conservation and Recovery

Act (RCRA) corrective action process. RCRA regulates hazardous waste from

its origin through its ultimate treatment, storage, or disposal.

The Environmental Protection Agency (EPA) and Florida’s Department of

Environmental Protection are responsible for monitoring Kennedy’s

compliance with environmental law. Kennedy works with the concerned

regulatory agency to reach agreements on the types of remediation

activities and on the dates they will be carried out.

Extent of

Contamination

Within NASA, Kennedy has the second largest inventory of potentially

contaminated sites. According to Kennedy officials, their site inventory

should be about complete, and they expect to complete site remediation

by 2008 and operation of water treatment facilities by 2015.

Contaminated Sites In performing its mission, Kennedy has generated waste that includes

petroleum, metals, solvents, adhesives, and sandblast residues. This waste

is considered to be ignitable, corrosive, and/or toxic. It has contaminated

the soil and groundwater and may be a danger to human health.

Contamination usually results from improper disposal, leaks, or spills.

Although NASA headquarters’ March 1996 inventory of potentially

contaminated sites shows that Kennedy has 109 sites, Kennedy records

show that it has 127 sites. According to a Kennedy official, the disparity

occurred because Kennedy included all potential release sites in its

inventory. It will not report some of these sites to headquarters as

potentially contaminated sites until it conducts further investigations.

Seven of the sites are on the Cape Canaveral Air Force Station where

Kennedy has operated in the past. Kennedy’s sites were identified (1) by

routine sampling, (2) at areas where spills were not completely cleaned

Page 25 GAO/NSIAD-97-98 NASA’s Cleanup Costs
Appendix I 

John F. Kennedy Space Center

up, or (3) in response to a concern voiced by an employee or a regulatory

agency. Kennedy officials believe that all potential sites have been

identified.

Cleanup Status and

Schedule

The remediation status of Kennedy’s 127 potentially contaminated sites is

shown in table I.1.

Table I.1: Remediation Status of

Kennedy’s Sites Status Number

Cleanup in progress 1

Risk assessment completed 6

Being investigated 20

No further action contemplated 31

Need to be investigated 69

Total 127

The only contaminated site that Kennedy is currently cleaning up is the

Wilson Corners site. The Wilson Corners site was where a previous

landowner operated a component cleaning facility from the late 1950s

through 1963. Kennedy purchased the site in 1963, and according to

Kennedy officials, the prior landowner continued to operate the cleaning

facility until 1965 when all operations ceased. According to Kennedy

officials, most of the contamination occurred before Kennedy purchased

the site. The contaminants are trichloroethylene and its degradation

products. Kennedy started remediation in 1989 when it constructed a

water treatment system. Remediation now entails pumping groundwater

from 23 recovery wells and treating it. Kennedy monitors the influent,

treated effluent, and the recovery wells. The cleanup completion for this

pump and treat procedure usually takes years and sometimes is not

completely successful. The site is now vacated and surrounded by a fence.

According to Kennedy officials, by 1991, hazardous waste releases causing

contamination stopped. They said that current schedules project

remediation, on an average, of nine projects a year, and they estimate

remedial actions may be completed at all sites by 2008. They said,

however, water treatment facilities may need to be operated for about 

7 additional years. Thus, Kennedy’s cleanup effort may be completed by

2015.

Page 26 GAO/NSIAD-97-98 NASA’s Cleanup Costs
Appendix I 

John F. Kennedy Space Center

Cost to Clean Up

Contamination

NASA headquarters estimates that it will cost $379.6 million to clean up

Kennedy’s contaminated sites. This estimate was derived from selected

portions of a Department of Defense (DOD) cost model that multiplies the

average cost for a type of cleanup by the number of sites estimated to

require cleanup of that type. Kennedy’s estimate of $86.2 million is much

less than NASA headquarters’ estimate and is based on site-specific data.

Kennedy’s estimate, however, only includes sites that are projected for

cleanup through 2002, while the headquarters estimate includes all sites

potentially requiring cleanup.

Historical Costs Kennedy spent a total of $2.7 million through fiscal year 1995 from NASA’s

construction of facilities funds and from Kennedy’s program mission

support funds on remediation. According to Kennedy officials, NASA’s

construction of facilities funds for environmental remediation can be held

and spent in any year, and local annual program mission support funds can

be used during the budget year, as needed, for remediation activities such

as site investigations and long-term operations and maintenance.

For fiscal years 1990 through 1995, NASA headquarters authorized about

$5.5 million from its environmental construction of facilities funds for

remediation at Kennedy. From these funds, Kennedy has spent $1.6 million

through fiscal year 1995 on remedial investigations. It has not spent any

construction of facilities funds on remedial design or remedial action

projects. For the one site being cleaned up (Wilson Corners), Kennedy is

using its local program mission support funds. Thus far, the cost of this

remedial action has been about $1.1 million. It consists of the construction

of a water treatment facility ($265,000) and the facility’s operations and

maintenance ($168,000 annually since 1991). Kennedy officials said plans

to use authorized construction of facilities funds have been delayed

because of slow regulatory reviews.

In regard to off-site contamination, Kennedy has not been involved in the

cleanup of any contractor-owned or third-party contaminated sites.

Additionally, officials said that they are not aware of any overhead charges

being added to their contracts because of environmental cleanups at

contractor facilities.

Future Costs Kennedy estimates that it will spend $83.5 million for fiscal years 1996

through 2002 on 42 contaminated sites (see table I.2). According to

Kennedy officials, the remaining sites (85) have not been investigated

Page 27 GAO/NSIAD-97-98 NASA’s Cleanup Costs
Appendix I 

John F. Kennedy Space Center

enough to estimate remediation costs or, moreover, to determine if they

require cleanup.

Table I.2: Kennedy’s Projected Remediation Costs for Fiscal Years 1996 Through 2002

Fiscal year

Dollars in millions

Remediation phase 1996 1997 1998 1999 2000 2001 2002 Total

Investigation $3.8 $4.6 $2.5 $1.0 $0.2 0 0 $12.1

Design 0.1 0.8 1.1 0.7 1.0 $0.2 0 3.9

Action 1.1 5.4 14.1 15.5 12.8 15.9 $2.7 67.5

Total $5.0 $10.8 $17.7 $17.2 $14.0 $16.1 $2.7 $83.5

Kennedy has not projected remediation costs beyond 2002, although the

cleanup is not expected to be completed until 2015. Kennedy officials said

they will not have complete and accurate cost estimates until 1999. To do

this, they will have to obtain data on the amount and type of

contamination at each site and determine the risks associated with the

location, amount, and contaminant types.

Cost Sharing Efforts Neither NASA headquarters nor Kennedy has developed any definitive

guidance in terms of pursuing potentially responsible parties to share

cleanup costs. To date, Kennedy has not pursued any potentially

responsible parties.

Cost Sharing Policy CERCLA allows a party conducting a cleanup to recover cost from

potentially responsible parties. These parties may include present and past

owners, operators, and contractors, among others.1 NASA headquarters,

however, has not yet provided any written guidance to Kennedy on sharing

remediation costs. Accordingly, Kennedy has not issued a written policy

on recovering of remediation costs from potentially responsible parties.

Kennedy’s Chief of the Environmental Management Office said that

potentially responsible parties should be pursued in appropriate cases and

believes that the potentially responsible party issue needs to be resolved at

the NASA headquarters level. When a potentially responsible party can be

found, Kennedy’s stated policy is to conduct the cleanup and then decide

whether to seek reimbursement.

1

A federal agency conducting a RCRA corrective action can qualify for CERCLA cost recovery if its

cleanup actions are “not inconsistent with the National Contingency Plan.”

Page 28 GAO/NSIAD-97-98 NASA’s Cleanup Costs
Appendix I 

John F. Kennedy Space Center

Cost Sharing Practices NASA has always considered environmental contamination on Kennedy’s

property to be the result of its activities because NASA operates its facility

and oversees its contractors. According to Kennedy officials, however,

contractors should assume some responsibility for their actions and

should participate in cost sharing agreements for remediation because

contractors perform the vast majority of industrial operations at Kennedy.

We discussed cases in which Kennedy will pay cleanup costs, and

Kennedy officials said that they may pursue cost sharing in two. These

cases involved a former landowner and a former lessee. In regard to the

former landowner, Kennedy officials said that they will consider action

against the former landowner of the Wilson Corners site, which involves

groundwater contamination. To date, Kennedy has spent $1.1 million

remediating this site and will spend $168,000 per year to pump and treat

for the foreseeable future. In the case involving the former lessee,

Kennedy plans to spend about $3.5 million to clean up fuel oil

contamination at its visitor’s center (Spaceport USA). Cleanup involves

removing and aerating soil at the site. At the time of the contamination, the

visitor’s center was operated by a lessee. A storage tank leaked gas or

diesel fuel and contaminated the soil. Kennedy officials believe that the

lessee had control of the situation and should be held responsible.

However, there is currently no cost sharing agreement in place. According

to Kennedy officials, the former lessee paid for the remedial investigation

at the site before Kennedy assumed control of the cleanup. Kennedy

officials said that they took over the cleanup of the site because the lessee,

which had operated the visitor’s center, lost the lease to another company

now operating the center. After the cleanup is completed, Kennedy will

decide whether the former lessee will be asked to reimburse the

government.

Page 29 GAO/NSIAD-97-98 NASA’s Cleanup Costs
Appendix II 

Michoud Assembly Facility

Background

Site Description and

Mission

The Michoud Assembly Facility is a government-owned,

contractor-operated component of the George C. Marshall Space Flight

Center. The facility has been owned by NASA and operated by a contractor

since its acquisition by NASA in 1961. Michoud is located in New Orleans,

Louisiana, on about 830 acres of government-owned land (see fig. II.1).

Figure II.1: Location of the Michoud

Assembly Facility

Michoud

New Orleans

Baton Rouge

Shreveport

Source: NASA Real Property Locations by Accountable Reporting Installations.

Page 30 GAO/NSIAD-97-98 NASA’s Cleanup Costs
Appendix II 

Michoud Assembly Facility

Michoud’s mission is to support the continuing development and

operations of the NASA space shuttle program. Specifically, Michoud

provides the design and assembly of the external tank for the space

shuttle.

Regulatory Process Contaminated sites at Michoud are being addressed under the RCRA

corrective action process. On January 23, 1995, the remediation program,

including all decision-making authority, was transferred to the state of

Louisiana because the state received authorization from EPA to implement

the RCRA program. EPA’s current responsibility is to provide oversight to the

state and to monitor the groundwater program.

Extent of

Contamination

Contaminated Sites As a manufacturing facility, past waste management disposal practices and

accidents have contaminated Michoud’s soil, surface water, and

groundwater with trichloroethylene, volatile organic compounds, metals,

diesel fuel, and other contaminants. According to Michoud officials and

the operating contractor, it appears the vast majority of contamination

resulted from NASA’s Apollo program after the site was transferred to NASA

in 1961. According to Michoud and the operating contractor,

trichloroethylene in the groundwater presents the greatest risk, and the

likely major cause of the groundwater contamination was a 16,000-gallon

trichloroethylene spill that occurred in 1966. The contamination appears

to be limited to the upper 45 feet of groundwater and soil in only a few

areas.

The operating contractor first discovered environmental contamination at

Michoud in November 1982. The RCRA facility assessment in August 1986

identified 57 potentially contaminated sites. According to the operating

contractor, more detailed evaluations by the state and EPA determined 46

of these sites required no further action. The remaining 11 sites, plus two

additional ones identified and 10 petroleum-related sites added by the

regulators, comprise the 23 potential sites being investigated. NASA

headquarters’ March 1996 inventory of sites lists 33 sites for Michoud.

Twenty of these are already closed sites (13); nonleaking, above-ground

active petroleum storage tanks (4); or sites recommended for no further

Page 31 GAO/NSIAD-97-98 NASA’s Cleanup Costs
Appendix II 

Michoud Assembly Facility

action (3). The operating contractor was unable to reconcile individual

differences between the NASA headquarters’ inventory of sites and the 23

sites it is currently investigating.

Cleanup Status and

Schedule

A phase II RCRA facility investigation report was sent to regulators for

review and approval. A phase III and phase IV RCRA facility investigation

will finish delineating the extent of contamination at areas not covered by

the phase II RCRA. Phases III and IV may extend through 1999 and could

include actions that range from implementing corrective measures that

result in clean closure to monitoring contaminants to ensure containment

within Michoud’s boundaries. A corrective measures study will then be

performed to identify cleanup alternatives and could be completed in 2001

or 2002. According to Michoud officials, they cannot estimate when

remediation will be completed until they have negotiated cleanup

standards with the state and EPA.

All of the areas suspected of being contaminated have been evaluated;

therefore, the inventory for Michoud should be complete. The operating

contractor does not currently plan to completely clean up about half of

Michoud’s contaminated areas because of the technical and/or economic

impracticability of cleaning the contaminated groundwater to pristine

condition. This plan is due to Michoud’s dense nonaqueous phase

groundwater contamination.1

 According to the operating contractor, a

significant portion of the released trichloroethylene will remain in the soil

at the end of all remediation activities. The operating contractor’s cleanup

strategy is subject to state approval.

Cost to Clean Up

Contamination

NASA headquarters estimates that it will cost $54 million to clean up

Michoud’s contaminated sites, not including operations and maintenance.

Michoud’s operating contractor estimates it will cost $16.5 million, not

including long-term operations and maintenance or costs prior to 1988.

Different estimating methodologies were used to develop the estimates. If

all Michoud sites were required to be cleaned to the highest standard, the

operating contractor noted it could cost over $800 million.

Historical Costs For fiscal year 1988 through fiscal year 1995, Michoud received

$6.5 million in construction of facilities funds for remediation activities, of

1

According to EPA, dense nonaqueous phase liquids often are difficult to locate and remove from the

subsurface. Their ability to sink through the water table and penetrate deeper portions of aquifers is

one of the properties that makes them very difficult to remediate.

Page 32 GAO/NSIAD-97-98 NASA’s Cleanup Costs
Appendix II 

Michoud Assembly Facility

which $1.9 million was used for investigations or studies and $4.6 million

was used for cleanup activities. All remediation and related projects since

1988 have been funded out of NASA’s construction of facilities budget and

have been directly charged to Michoud’s operations contract. According to

the operating contractor, NASA’s external tank operations budget was used

to fund all remediation activities from 1982 to 1988 and costs associated

with these activities cannot be segregated in accounting records.

Future Costs The operating contractor’s total cost estimate of $16.5 million is about 70

percent lower than NASA headquarters’ estimate of $54 million. According

to a Michoud official, NASA headquarters’ estimate could be overstated

because it was developed using parts of a DOD cost model that treats

contaminated sites at different locations the same regardless of their size

or extent of contamination.

From fiscal year 1996 to fiscal year 2003, the operating contractor

estimates that remediation activities will cost $10 million, but this amount

does not include long-term operations and maintenance costs. According

to the operating contractor, operation and maintenance of all remedial

systems will continue throughout the external tank program at Michoud

and costs cannot be accurately estimated. However, the operating

contractor’s risk-based assumptions used in preparing the estimates were

all subject to state approval.

It is unknown whether future funding levels will be a problem, according

to the operating contractor. Requirements and cleanup standards are

currently unclear and will likely result in increased funding needs.

According to a Michoud official, the estimated cost to complete

remediation will depend heavily on the results of the RCRA facility

investigation, the corrective measures study, the corrective measures plan,

and the mandated cleanup standards.

In addition to remediation costs, Michoud reimburses the state of

Louisiana for the cost of regulating its hazardous and solid waste, as well

as its groundwater program. Michoud paid the state $28,500 in 1995 for a

total of approximately $200,000. EPA is not reimbursed for its work.

Because off-site contractors have not worked for Michoud, it will not incur

any additional costs for cleanup at contractor-owned locations.

Page 33 GAO/NSIAD-97-98 NASA’s Cleanup Costs
Appendix II 

Michoud Assembly Facility

Cost Sharing Efforts There are no cost sharing agreements in place for cleanup activities at

Michoud. According to Michoud officials, remediation efforts are primarily

addressing contamination from government activities from the early 1960s.

To determine the potential of recovering environmental remediation costs

(either from contractors or insurance companies), Michoud officials

searched for copies of contracts and insurance policies for three

contractors that operated at Michoud during the 1960s. At the time the

16,000-gallon trichloroethylene spill occurred, Michoud officials said that

the Boeing Corporation was the operating contractor. An April 1993

memorandum shows that Michoud could not find the contracts or

insurance policies. NASA has not conducted similar searches for the current

production contractor because the majority of the contamination existed

before the contractor came on site.

Page 34 GAO/NSIAD-97-98 NASA’s Cleanup Costs
Appendix III 

Santa Susana Field Laboratory

Background

Site Description and

Mission

The Santa Susana Field Laboratory occupies about 2,700 acres in the

southeast corner of Ventura County, California, about 29 miles northwest

of Los Angeles near the crest of the Simi Hills (see fig. III.1).

Page 35 GAO/NSIAD-97-98 NASA’s Cleanup Costs
Appendix III 

Santa Susana Field Laboratory

Figure III.1: Location of the Santa

Susana Field Laboratory

Santa Susana

Los Angeles

San Francisco

Source: NASA Real Property Locations by Accountable Reporting Installations.

Page 36 GAO/NSIAD-97-98 NASA’s Cleanup Costs
Appendix III 

Santa Susana Field Laboratory

Most of the land adjacent to the Santa Susana facility is undeveloped

mountainous land. The nearest residential developments are located about

a mile from the facility. There are a few acres of avocado orchards and one

apiary; both are on private property immediately adjacent to the facility.

Since 1947, Santa Susana activities have included research, development,

and testing of rocket engines, water jet pumps, lasers, liquid metal heat

exchanger components, nuclear energy, fossil fuel projects, and related

technologies. The principal activity has been the testing of large rocket

engines. Six major liquid rocket engine test areas operated simultaneously

in the late 1950s and early 1960s.

Organization Rockwell International Corporation, Seal Beach, California (formerly

North American Aviation), has been the sole-operating contractor at Santa

Susana since the facility was established. It currently operates the facility,

primarily for NASA.

Since 1958, the federal government, first the Air Force and since 1972 NASA,

has owned a portion of the facility. NASA’s Marshall Space Flight Center is

responsible for overseeing the environmental remediation activities on the

NASA-owned property at Santa Susana. Rockwell, as part of its operating

contract with NASA, is responsible for

• preparing environmental work plans;

• negotiating with the California Department of Toxic Substances Control

and EPA regulators;

• preparing overall status and groundwater monitoring reports;

• awarding subcontracts to perform studies and interim corrective

measures;

• overseeing subcontractor performance; and

• maintaining all cleanup-related records, including cost records for the

NASA-owned property at Santa Susana.

Rockwell subcontracts studies and investigations, interim corrective

measures, and water sampling and maintenance of monitoring wells.

Rockwell deals with environmental issues related to the property it owns

as well. Environmental expenses related to its property are passed to NASA

as well as other customers—primarily DOD and the Department of

Energy—through overhead charges on contracts it has with them.

Page 37 GAO/NSIAD-97-98 NASA’s Cleanup Costs
Appendix III 

Santa Susana Field Laboratory

Regulatory Process Santa Susana is subject to the RCRA corrective action process. Under RCRA,

EPA has authorized the California Department of Toxic Substances Control

to manage the hazardous waste and corrective action programs in

California. Since Santa Susana is an operating site, the Department of

Toxic Substances Control has the lead agency role in regulating the site,

and it reviews and approves the work plans for the proposed investigation

and remediation procedures. The Los Angeles Regional Water Quality

Control Board is also involved on an advisory basis.

Extent of

Contamination

Contaminated Sites Environmental contamination was first identified at the Santa Susana

facility when Rockwell found trichloroethylene during an investigation of

site water wells in 1984. Rockwell notified the water board about the

detected groundwater contamination, and the board requested that

Rockwell further investigate the water quality and hydrogeologic

conditions at Santa Susana. In response, Rockwell initiated a phased

investigation. Based on Rockwell’s preliminary characterization efforts,

the board recommended implementing interim remedial measures for the

contaminated groundwater.

EPA conducted a RCRA facility assessment in 1990 of the entire Santa

Susana facility and identified a number of potentially contaminated sites.

The Department of Toxic Substances Control issued a stipulated

enforcement order to Rockwell on November 12, 1992, requiring that it

prepare a draft RCRA facility investigation work plan. Rockwell submitted a

work plan to the Department of Toxic Substances Control for its review in

March 1995.

Santa Susana has a number of specific potentially contaminated sites, but

the overriding contamination problem is the trichloroethylene

contamination of the groundwater that encompasses a large portion of the

facility. The RCRA facility investigation work plan, dated March 1995,

identifies 82 potentially contaminated sites and areas of concern for all

areas of Santa Susana. NASA headquarters’ March 1996 inventory for the

NASA-owned property lists 2 petroleum sites and 33 contaminated sites.

The remaining sites (47) are on Rockwell-owned property.

Page 38 GAO/NSIAD-97-98 NASA’s Cleanup Costs
Appendix III 

Santa Susana Field Laboratory

Historically, the principal use of trichloroethylene was to decontaminate

the large engines to prevent the risk of explosion during testing. About

97 percent of the trichloroethylene was released from 1954 through 1961.

In 1961, Rockwell began reclaiming trichloroethylene. Most

trichloroethylene has been reclaimed at all large test areas. Except for one

test area, the use of trichloroethylene at the site was discontinued in 1977.

A reclamation system for used trichloroethylene is currently maintained at

this test area. DOD was Rockwell’s principal customer prior to 1961 with

such programs as the Navaho, Atlas, Jupiter, and Thor rocket engines. A

1993 records search and trichloroethylene release assessment report

prepared by a contractor for NASA stated that 530,358 gallons of

trichloroethylene were released to the ground at Santa Susana.

Cleanup Status and

Schedule

The current remediation status of the 35 NASA-owned sites at Santa Susana

is shown in table III.1.

Table III.1: Remediation Status of

NASA-owned Sites Status Number

Investigating 14

No further action 11

Monitoring 5

Closed 2

Other 3

Total 35

The Department of Toxic Substances Control has not yet agreed to the no

further action decision for the 11 sites. Rockwell officials were not sure

whether additional sites will be identified. Some of the groundwater

contamination migrated off site to the north and northeast, and Rockwell

is monitoring and will decide what actions are required.

While Santa Susana has soil and surface water contamination, the

groundwater contamination is the major concern and, accordingly, is the

focus of Rockwell’s efforts. After detecting trichloroethylene in water

samples from water supply wells in 1984, a phase I investigation was

conducted to develop a plan for field investigations. Field investigations,

including well construction, water sampling, photogeologic assessment,

and well testing, were conducted in the phase II groundwater

investigation. Groundwater conditions at the facility were evaluated based

on data compiled from 231 wells that included 202 monitoring wells

Page 39 GAO/NSIAD-97-98 NASA’s Cleanup Costs
Appendix III 

Santa Susana Field Laboratory

constructed at or adjacent to the facility, 13 facility water supply wells,

and 16 private off-site wells and springs.

A groundwater reclamation system began operating at the facility in 1987

to extract degraded groundwater and to minimize the off-site movement of

degraded water by modifying and controlling groundwater gradients. A

contractor report stated that about 138 gallons of volatile organic

compounds (mostly trichloroethylene) were removed through

groundwater treatment operations for fiscal year 1988 through the first

quarter of 1996.

After Rockwell completes the RCRA facility investigation, it plans to

perform a corrective measures study to recommend the final corrective

action(s). A Rockwell official estimates that the corrective measures study

will begin in late 1997 to early 1998.

Cost to Clean Up

Contamination

Historical Costs Through fiscal year 1995, a total of $21.1 million—$15.6 million by NASA

and $5.5 million by others, including DOD—had been spent or authorized to

clean up Santa Susana through direct and indirect overhead charges. NASA

pays either directly for cleanup costs on the property it owns or through

overhead charges for the property owned by Rockwell.

For direct charges, NASA headquarters authorized $6.2 million in

construction of facilities funds for remediating groundwater in the

NASA-owned portion for fiscal years 1990 through 1995. In addition, it

authorized $1.5 million of construction of facilities funds that were

designated as RCRA corrective action for (1) soil cleanup and closure and

(2) decontamination of surface impoundments in area II and the

NASA-owned portion of area I.

For fiscal years 1983 through 1995, Rockwell included $13.4 million in

overhead charges for study and remediation costs primarily for

groundwater in areas I and III. NASA paid $7.9 million of this total, DOD paid

$1.7 million, and others, including the Department of Energy, paid the

remainder.

Page 40 GAO/NSIAD-97-98 NASA’s Cleanup Costs
Appendix III 

Santa Susana Field Laboratory

For fiscal year 1996, NASA authorized $1 million in construction of facilities

funds for groundwater remediation and $900,000 for RCRA corrective action

of soil and surface impoundments.

Future Costs Based on the portions of the DOD cost model that NASA used to project

cleanup costs, NASA headquarters estimates that it will cost $93 million to

clean up the contaminated sites on the NASA-owned property at Santa

Susana, exclusive of the operations and maintenance cost to run the pump

and treat system for groundwater remediation. In contrast, Rockwell

estimates cleanup costs at $11.1 million, of which $9.6 million has already

been obligated or spent. Neither estimate includes the operation and

maintenance costs of the groundwater reclamation system for fiscal years

1997 through 2037, which NASA estimates at $58.5 million.

Rockwell estimates it will pass on $7.2 million through overhead charges

for the portion of Santa Susana that it owns. Based on current contracts,

NASA expects to pay $4.4 million, or about 60 percent, of this total.

However, Rockwell will not estimate costs beyond the year 2000,

significantly understating the amount NASA will have to pay through

overhead charges.

Cost Sharing Efforts At this time, no final arrangements have been made for the current and

past owners or operators of Santa Susana to share costs. The portion of

Santa Susana that NASA currently owns is considered a “formerly used

defense” site. Therefore, the Corps of Engineers, Omaha District, tried to

determine how the liability for environmental cleanup should be divided

among NASA, Rockwell, and DOD.

In April 1989, Rockwell requested authorization for a defense

environmental restoration project that would be funded through the DOD

defense environmental restoration program. The Corps of Engineers is

representing DOD in evaluating Rockwell’s request, and it used a contractor

to investigate the environmental contamination at the facility. The study

concluded that Rockwell was responsible for 92 percent of the

groundwater contamination, while the Air Force and NASA were each

responsible for 4 percent. In a January 7, 1990, memorandum to Rockwell,

the Corps concluded that Rockwell activities at the site failed to comply

with the applicable requirements of the national oil and hazardous

substances pollution contingency plan. Therefore, the Corps decided any

Page 41 GAO/NSIAD-97-98 NASA’s Cleanup Costs
Appendix III 

Santa Susana Field Laboratory

past or future costs incurred by Rockwell cannot be reimbursed from

DOD’s defense environmental restoration program.

Since the Corps of Engineers’ decision, Rockwell, NASA, and the Corps

have been discussing the cleanup situation and potential liability, and NASA

has been paying the cleanup costs on the NASA-owned property. A

NASA-funded study concluded that most of the groundwater contamination

could be attributed to DOD. The NASA study showed that 88 percent related

to DOD and 12 percent related to NASA. In a November 9, 1994, letter, NASA’s

counsel said that NASA disagreed with the Corps. NASA believes it has been

paying a much larger portion than is fair and equitable. Also, NASA believes

DOD should have a larger share of the liability.

In a March 3, 1995, memorandum to NASA, the Corps stated that although

NASA and DOD support a three-party agreement, it is not confident that

Rockwell is willing to participate in an agreement. Further, the Corps

stated that if Rockwell is unwilling to either enter into such an agreement

or provide adequate assurances that it will not seek cost sharing later, it is

appropriate for NASA as a current landowner to take the legal action to

involve Rockwell in the agreement.

Corps officials said that they have not recently discussed the cost sharing

issue with NASA. Marshall Space Flight Center officials, who are

responsible for managing the NASA parcels of the Santa Susana facility, said

that they elevated further negotiations to NASA headquarters in a March 21,

1995, letter. NASA headquarters has reviewed the case and given some input

to Marshall relative to the case. Marshall requested NASA’s Inspector

General to review the case, and the Inspector General is in the process of

conducting a review.

Page 42 GAO/NSIAD-97-98 NASA’s Cleanup Costs
Appendix IV 

Scope and Methodology

We reviewed applicable laws and regulations, but we did not

independently determine compliance with laws or the merits of cost

sharing at individual facilities. We also reviewed policies, procedures, and

documents, including NASA databases on potentially contaminated sites.

We used NASA’s March 1996 inventory to determine the extent of

contamination and the status of cleanup. While there was an update during

our field work, we did not believe the update significantly changed the

March 1996 data.

We also interviewed officials and reviewed supporting documentation at

NASA and EPA headquarters in Washington, D.C., and at selected NASA field

facilities throughout the country to obtain data on cleanup costs. The field

facilities visited were

• Ames Research Center, Moffett Field, California;

• George C. Marshall Space Flight Center, Huntsville, Alabama;

• Jet Propulsion Laboratory, Pasadena, California;

• John C. Stennis Space Center, Mississippi;

• John F. Kennedy Space Center, Florida;

• Langley Research Center, Hampton, Virginia;

• Michoud Assembly Facility, New Orleans, Louisiana;

• NASA Industrial Plant, Downey, California; and

• Santa Susana Field Laboratory, Ventura County, California.

To obtain supplemental information, we sent data collection instruments

to the other NASA field facilities and 20 of NASA’s largest contractors. Table

IV.1 lists the NASA facilities and the 16 contractors that responded to our

request.

Page 43 GAO/NSIAD-97-98 NASA’s Cleanup Costs
Appendix IV 

Scope and Methodology

Table IV.1: Locations and

Organizations Responding to Our Data

Request

Location Organization

NASA Dryden Flight Research Center, Edwards, California

Goddard Space Flight Center, Greenbelt, Maryland

Lewis Research Center, Cleveland, Ohio

Lyndon B. Johnson Space Center, Houston, Texas

Wallops Flight Facility, Wallops Island, Virginia

White Sands Test Facility, Las Cruces, New Mexico

Private contractor Allied Signal, Inc., Morriston, New Jersey

BAMSI, Inc., Titusville, Florida

Boeing Company, Seattle, Washington

CAE Link Corporation, Binghamton, New York

Computer Sciences Corporation, El Segundo, California

EG&G Florida, Inc., Florida

General Electric Company, Inc., Fairfield, Connecticut

GM Hughes Electronics Company, Los Angeles, California

Lockheed Martin Corporation, Bethesda, Maryland

Loral Corporation, New York, New York

McDonnell Douglas Corporation, Saint Louis, Missouri

Northrop Grumman Corporation, Los Angeles, California

Rockwell International Corporation, Seal Beach, California

Thiokol Corporation, Odgen, Utah

TRW, Inc., Cleveland, Ohio

United Technologies Corporation, Hartford, Connecticut

Starting in fiscal year 1998, federal accounting standards will require

liability estimates for hazardous materials such as mission equipment

rockets, launchers, and space exploration equipment. We did not examine

NASA’s potential liabilities for such mission equipment in this review.

Page 44 GAO/NSIAD-97-98 NASA’s Cleanup Costs
Appendix V 

Comments From the National Aeronautics

and Space Administration

Note: GAO comments

supplementing those in the

report text appear at the

end of this appendix.

See pp. 18-19.

See pp. 18-19.

Page 45 GAO/NSIAD-97-98 NASA’s Cleanup Costs
Appendix V 

Comments From the National Aeronautics

and Space Administration

Now on pp. 10-12.

See comment 1.

Now on pp. 4 and 6.

See comment 2.

Now on p. 8.

See comment 2.

Now on p. 11.

See comment 1.

Now on p. 11.

See comment 3.

Now on p. 42.

See comment 4.

Page 46 GAO/NSIAD-97-98 NASA’s Cleanup Costs
Appendix V 

Comments From the National Aeronautics

and Space Administration

See pp. 18-19.

See pp. 18-19.

See pp. 18-19.

See comment 5.

Page 47 GAO/NSIAD-97-98 NASA’s Cleanup Costs
Appendix V 

Comments From the National Aeronautics

and Space Administration

See pp. 18-19.

See comment 6.

Page 48 GAO/NSIAD-97-98 NASA’s Cleanup Costs
Appendix V 

Comments From the National Aeronautics

and Space Administration

See pp. 18-19.

See pp. 18-19.

Page 49 GAO/NSIAD-97-98 NASA’s Cleanup Costs
Appendix V 

Comments From the National Aeronautics

and Space Administration

The following are GAO’s comments on NASA’s letter dated May 16, 1997.

GAO Comments 1. Our report recognizes that NASA has updated the information on cleanup

costs by using a new cost model that includes a cost for each site believed

to require cleaning up. The cost information developed using the new

model, however, is not complete because 90 additional sites are to be

added. Also, most sites are still being investigated by the NASA field

facilities. Because the new model’s interim cost data total only about

10 percent less than the prior cost data and additional sites will be added,

we did not change the cost information in the report. Cost information

shown in our appendixes was gathered directly from NASA’s field facilities

and was not related to either the new or old model.

2. We revised our report to more clearly identify NASA’s actions and status.

3. We included footnote 10 in the report text to recognize that the new cost

model will include at least 5 years of long-term operation and maintenance

costs for applicable sites.

4. We updated the information in appendix III to reflect the most current

status of the Santa Susana case.

5. We modified the recommendation to state that NASA should obtain the

necessary information.

6. NASA’s stated position is consistent with the intent of our

recommendation. We do not go beyond the requirement stated by NASA to

identify remediation cleanup liabilities for reporting. We recommended

identifying infrastructure changes and associated cost impact, such as for

changes planned at the Downey facility. We did not intend to recommend

identifying changes that are not planned, so we modified our

recommendation to make this distinction clear.

Page 50 GAO/NSIAD-97-98 NASA’s Cleanup Costs
Appendix VI 

Major Contributors to This Report

National Security and

International Affairs

Division, Washington,

D.C.

Brad Hathaway

Charles I. Patton, Jr.

Uldis Adamsons

Denver Field Office Patricia Foley Hinnen

Norfolk Field Office Edwin J. Soniat

Johnnie Phillips

Raul S. Cajulis

Dallas Field Office David P. Marks

R.E. Erdman

Los Angeles Field

Office

Gary W. Kunkle

(709215) Page 51 GAO/NSIAD-97-98 NASA’s Cleanup Costs
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