Page 1 GAO-03-633R External Regulation of DOE

May 14, 2003 

The Honorable David L. Hobson 

Chairman 

The Honorable Peter J. Visclosky 

Ranking Minority Member 

Subcommittee on Energy and Water Development 

Committee on Appropriations 

House of Representatives 

Subject: Department of Energy: External Regulation Savings in 

Safety and Health Activities at DOE Science Laboratories

The Department of Energy (DOE) is unusual among federal agencies in 

that it regulates and inspects its own facilities to protect the safety and 

health of its workers and of the communities surrounding its vast complex 

of research laboratories. With few exceptions, all other federal facilities 

must comply with national standards set by the Nuclear Regulatory 

Commission (NRC) for nuclear safety and by the Occupational Safety and 

Health Administration (OSHA) for worker safety and health. 

DOE asserts that, for the most part, its safety and health standards meet or 

exceed those promulgated for facilities regulated by NRC and OSHA. At 

DOE’s 10 science laboratories, which are run by management and 

operating (M&O) contractors, the department and its contractors use a 

contract administration process to select standards appropriate to current 

worker hazards and public safety issues.1

Both DOE and the M&O contractors are involved in safety and health 

activities.2

 DOE’s field offices, most of which are located at the 

laboratories, provide continuous safety and health oversight of the M&O 

contractors. DOE headquarters offices provide policy guidance to the field 

offices and also conduct some oversight of the laboratories. Safety and 

 1

 These science laboratories are also known as nonmilitary energy laboratories or nondefense science laboratories. 

2

 DOE and contractor safety and health personnel are involved in emergency preparedness, 

fire protection, industrial hygiene, industrial safety, occupational medical services, nuclear 

safety, radiation safety, transportation safety, and management of oversight and reporting 

on these safety and health activities. 

United States General Accounting Office

Washington, DC 20548 
Page 2 GAO-03-633R External Regulation of DOE

health personnel working for the M&O contractors take actions to 

comply with the safety and health standards and conduct their own 

self-assessment activities. DOE’s field offices track contract compliance 

through direct observations and through the review of safety and health 

reports and other related information provided by the M&O contractors. 

Over a decade ago, DOE began considering whether to end self-regulation 

of its facilities to improve safety and public trust in the department, among 

other reasons. However, after much study, the department concluded that 

the costs of shifting to external regulation would exceed the potential 

benefits of doing so. We have taken a position different from DOE. For 

example, in a 2002 report, we observed that external regulatory agencies’ 

“greater independence, coupled with use of national nuclear and worker 

safety standards and enforcement powers, would make them more 

cost-effective regulators [than DOE].”3

 In addition, any resource savings to 

the department in shifting to external regulation could potentially be 

redirected to other mission priorities. 

The conference report accompanying the Energy and Water Development 

Appropriations Act for fiscal year 2002 directed DOE to prepare an 

implementation plan for shifting the department’s science laboratories to 

external regulation.4

 In July 2002, DOE presented a plan that was 1 month 

late and lacked important information. A subsequent committee report 

accompanying the 2003 appropriations bill criticized DOE for providing 

the “grossly inadequate” plan.5

 This report concluded that DOE “cannot be 

relied upon to provide accurate and objective information in response to 

Committee requests for information on this issue.” You therefore 

requested us to determine (1) how much DOE spends on safety and health 

activities at its science laboratories and (2) how much DOE might save 

after shifting to external regulation of these facilities. To address these 

objectives, we substantially relied on data collection instruments that we 

sent to DOE and M&O contractor officials associated with the 10 science 

laboratories. We briefed your offices on the results of our review on 

March 28, 2003, using the enclosed slides. This is report summarizes the 

results of that briefing. 

 3

 U.S. General Accounting Office, Department of Energy: Observations on Using External 

Agencies to Regulate Nuclear and Worker Safety in DOE’s Science Laboratories, GAO-02-

868R (Washington, D.C.: June 26, 2002). 

4

 H.R. Rep. No. 107-258, October 30, 2001, at 109-110. 

5

 H.R. Rep. No. 107-681, September 24, 2002, at 133-134. 
Page 3 GAO-03-633R External Regulation of DOE

In FY 2002, DOE spent about $145 million on safety and health activities at 

its 10 science laboratories, and we believe that this spending level has not 

varied much during the last 4 years. This expenditure represented about 

16 percent of all safety and health costs department wide. Virtually the 

entire expenditure went to cover the more than 1,400 federal and M&O 

contractor personnel involved in safety and health activities—about 

95 percent of whom worked for the M&O contractors. The reported safety 

and health costs do not include any maintenance costs, which are 

accounted for separately. 

A shift to external regulation of the science laboratories could decrease 

DOE’s annual safety and health costs by up to about $41 million, or 

increase these costs up to about $5 million depending on the level of 

continued department oversight of these activities. Any potential savings 

in DOE safety and health costs, however, would likely be applied to 

reduce other costs associated with external regulation and would, 

therefore, not produce immediate overall budgetary savings. Costs would 

be incurred to bring the laboratories into compliance with national safety 

and health standards and to supplement the staffs of the external agencies 

to take on regulatory and inspection responsibilities for the numerous 

facilities at each science laboratory. In addition, both DOE and the M&O 

contractors might transfer safety and health personnel to other functional 

areas in their respective organizations rather than eliminate these 

positions to reduce overall operating costs. Further reductions in safety 

and health costs might be possible through staff reductions at DOE 

headquarters offices. However, these offices contend that personnel 

reductions are unlikely because staff will still be needed to self-regulate 

other facilities, such as the defense laboratories, and to interact with the 

external regulators. 

Any reduction in DOE safety and health costs after shifting to external 

regulation would stem from DOE altering its approach to overseeing safety 

and health activities. If DOE continues with its current oversight approach 

after regulatory authority shifts to NRC and OSHA, safety and health costs 

could actually increase up to about $5 million annually. These additional 

costs would result from DOE increasing its current safety and health 

staffing levels to interact with the external regulatory agencies, and the 

M&O contractors increasing their safety and health staffing levels to 

respond to reporting requirements and information requests from both the 

external regulators and DOE. We found that the DOE safety and health 

oversight approach, which drives staffing levels, is substantially reflected 

in the number of contractually required safety and health reports and 

frequent ad hoc information requests of the M&O contractors. Eliminating 

Summary 
Page 4 GAO-03-633R External Regulation of DOE

redundant information requests and oversight after shifting to external 

regulation could justify a reduction in or redirection of safety and health 

personnel that would lower safety and health costs. 

External regulation of the science laboratories would provide a number of 

benefits. In a 2001 report, we found that eliminating DOE self-regulation 

of safety and health activities and taking other actions would improve the 

accountability of the department.6

 For a 2002 report, our examination 

of federal and foreign laboratories comparable to DOE’s science 

laboratories suggested that “external regulators can potentially oversee 

[the laboratories] more efficiently and at less cost than DOE’s internal 

staff.”7

 In a subsequent testimony, we concluded “the issue is not should 

DOE shift to external regulation of its science laboratories, but how.”8

Shifting to external regulation of the science laboratories will entail 

federal government costs to bring the laboratories into compliance with 

national standards and annual cost increases for the regulatory agencies. 

Any potential reduction in safety and health costs within DOE and its M&O 

contractors is expected to help offset these other costs. To ascertain the 

greatest of these anticipated costs, the conference report on continuing 

appropriations for FY 2003 directed NRC and OSHA to conduct 

compliance audits of the 10 science laboratories, with funding support 

from DOE, and to cooperate with the department in preparing cost 

estimates to bring the laboratories into compliance with external 

regulations.9

 The final DOE report is due no later than April 30, 2004. 

According to DOE, the transition costs to external regulation could be 

high, depending on the flexibility of the regulators in applying their 

standards to the department’s unique facilities without compromising 

safety. We have previously reported, however, that DOE would likely 

incur many of these costs anyway if the department were to bring the 

 6

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

Needed to Address Major Mission, Structure, and Accountability Problems, GAO-02-51

(Washington, D.C.: December 21, 2001). 

7

 GAO-02-868R. 

8

 Department of Energy, Observations on Externally Regulating Nuclear and Worker 

Safety in DOE’s Science Laboratories, GAO-02-974T (Washington, D.C.: July 25, 2002). 

9

 H.R. Rep. No. 108-10, February 12, 2003, at 898-899. 

Background 
Page 5 GAO-03-633R External Regulation of DOE

laboratories into compliance with DOE’s own safety and health standards. 

The annual costs after transition are primarily associated with increasing 

NRC and OSHA staffs to assume regulatory responsibilities for the science 

laboratories. In a DOE implementation plan for external regulation 

submitted to the Congress in July 2002,10 these agencies anticipated they 

would need an additional $6.9 million annually for this purpose.11

In FY 2002, DOE spent $145.3 million on safety and health activities 

associated with its 10 science laboratories. DOE data indicate that this 

level of spending has not changed much in the previous 4 years.12 This 

expenditure represented about 16 percent of total department spending on 

safety and health activities in FY 2002, compared to the 35 percent spent at 

National Nuclear Security Administration sites and the 45 percent spent 

at DOE environmental management sites.13 The reported expenditure 

does not include corrective maintenance for the repair of failed or 

malfunctioning equipment. 

Of the safety and health costs for the science laboratories, the portion 

spent on DOE oversight was about $8.6 million. This $8.6 million covered 

primarily the cost of the approximately 74 full-time equivalent (FTE) 

employees involved in safety and health policy development and oversight 

of the laboratories, most of whom (approximately 89 percent) were 

located in field offices. 

The M&O contractors, however, incurred the vast majority of the 

$145.3 million in safety and health costs. The cost of their safety and 

health activities in FY 2002 was $136.7 million. For the most part, this 

expenditure supported the nearly 1,334 FTEs involved in these activities, 

comprising 3 to 9 percent of the laboratories’ workforces. As reported to 

us, expenditures on safety and health activities by the M&O contractors 

represented about 3 percent of their total budgets. 

 10 Department of Energy, Implementation Plan for External Regulation of Non-Defense 

Science Laboratories. (Washington, DC: July 1, 2002). 

11 The regulatory agencies anticipate the need for an additional 24 full-time employees at 

NRC and an additional 19 at OSHA. 

12 Based on data obtained from DOE’s Functional Cost Report of 30 Major DOE Contractor 

Sites, the variation in safety and health costs since 1998 has been less than a 5 percent. 

13 The remaining small percentage of total safety and health costs went to miscellaneous 

activities. 

DOE Spends About 

$145 Million Annually 

on Safety and Health 

Activities 
Page 6 GAO-03-633R External Regulation of DOE

Table 1 summarizes the safety and health FTE levels and costs for DOE 

and the M&O contractors and compares these costs with overall budgets. 

Table 1: Safety and Health FTEs and Costs in Fiscal Year 2002 

Dollars in millions 

Location 

Safety and 

health FTEs 

Safety and 

health costs 

Overall 

budget 

Percent of 

budget 

DOE field 

offices 65.3 $7.5 $137.5 5.4 

DOE 

headquarters 8.5 1.1 98.3 1.1 

M&O 

contractors 1,333.8 136.7 4,201.3 3.3 

Total 1,407.6 $145.3 $4,437.2a

 3.3 

Source: Figures for safety and health FTEs and costs were derived from responses to data collection instruments sent to cognizant 

managers in these organizations. The overall budget figure for the DOE headquarters offices is based on their program direction

funding in fiscal year 2002. The budget figures for the DOE field offices affiliated with the 10 science laboratories and their M&O 

contractors came from responses to our survey. 

a

Total does not add up because of rounding. 

Up to about $41 million annually in DOE’s safety and health cost savings 

might accrue after the department shifts to external regulation, depending 

on the level of continued departmental oversight of safety and health 

activities. However, if DOE does not alter its oversight approach, 

especially through a reduction of contractual reporting requirements and 

ad hoc information requests of the M&O contractors, shifting to external 

regulation might require additional safety and health personnel, potentially 

increasing annual DOE safety and health costs by up to about $5 million. 

Our data collection instruments included three scenarios that asked DOE 

and M&O contractor safety and health managers how staffing levels might 

change under various levels of DOE oversight after NRC and OSHA begin 

regulating and inspecting the science laboratories. We developed a fourth 

scenario to provide an independent assessment of potential safety and 

health staff reductions for both DOE and its M&O contractors based on 

the experiences of another federal agency and its science laboratory 

which is already externally regulated. We selected the Jet Propulsion 

Laboratory, owned by the National Aeronautics and Space Administration 

(NASA), as a performance benchmark because DOE had already identified 

it as a federally funded research and development center comparable to its 

science laboratories. DOE has used the NASA interaction with the Jet 

Propulsion Laboratory contractor to identify best management practices 

for improving the overall efficiency and cost-effectiveness of its 

Annual Safety and 

Health Savings of 

Up to $41 Million 

Possible, Depending 

on Level of 

DOE Oversight 
Page 7 GAO-03-633R External Regulation of DOE

laboratories.14 The Jet Propulsion Laboratory concentrates its research on 

unmanned space operations, including solar system exploration, space 

and earth observing systems, robotic technology for space exploration, 

computational sciences for assimilation of large databases, and advanced 

instrumentation. The laboratory contractor holds all safety and health 

licenses with external regulators, and DOE considers this laboratory’s 

safety levels to be similar to that of its Lawrence Berkeley National 

Laboratory. In comparison to the Berkeley Lab and some other DOE 

science laboratories, however, the Jet Propulsion Laboratory has a small 

radioactive materials program, and it has no accelerator. On the other 

hand, the laboratory has about 30 percent more employees (about 

5,200 employees mostly at three sites in southern California) and over 

twice the operating budget (about $1.4 billion in fiscal year 2002) 

compared to the largest DOE science laboratory. 

The four scenarios of DOE oversight are: 

• Scenario 1: DOE holds all applicable licenses and permits with external 

regulators, eliminates the M&O contract requirements that duplicate those 

of the external regulatory agencies, but retains its current approach to 

contract performance oversight. 

• Scenario 2: The same as the first scenario, but the M&O contractor, 

instead of DOE, holds any licenses and permits issued by external 

regulatory agencies. 

• Scenario 3: The same as the second scenario, but DOE changes its 

approach to contract performance oversight, relying instead on best 

industry practices and norms for safety and health risk management. 

• Scenario 4: DOE adopts the safety and health management approach 

used by NASA at its Jet Propulsion Laboratory. This approach is 

essentially NASA’s application of scenario 3. 

Table 2 provides estimated changes in annual safety and health costs 

under the four scenarios for DOE oversight. The first scenario resulted in a 

projected increase in safety and health costs, while the other scenarios 

produced decreases in these costs through anticipated reductions in safety 

and health FTEs. Any reduction in annual DOE safety and health costs, 

however, might not produce overall budgetary savings, in part because the 

external agencies would need to supplement their staffs to regulate and 

inspect the science laboratories. In addition, there might not be immediate 

 14 Berkeley Lab. DOE Best Practices Pilot Study, LBNL/PUB-865 (Berkeley, CA: 

February 2002). 
Page 8 GAO-03-633R External Regulation of DOE

savings to DOE, given the transition costs to bring the laboratories into 

compliance with national safety and health regulations, irrespective of 

their present conditions relative to DOE’s own standards. Further, both 

DOE and the M&O contractors might transfer safety and health personnel 

to other functional areas in their respective organizations rather than 

eliminate these positions to reduce overall operating costs. Nevertheless, 

any savings in DOE safety and health personnel costs might be transferred 

to NRC and OSHA to help defray their increased costs, and reducing the 

safety and health personnel now required to meet the significant 

information needs of DOE might allow the M&O contractors to shift some 

of these resources to more science mission work or to needed 

maintenance and infrastructure upgrades. 

Table 2: Estimated Savings in Annual Safety and Health Costs 

Dollars in millions 

Location Scenario 1 Scenario 2 Scenario 3 Scenario 4

DOE field offices ($1.1 to $1.2) $0.2 $0.2 to $0.8 $5.9

M&O contractors (2.9 to 4.0) 0.4 to 0.8 7.4 to 8.7 35.2

Total ($4.0 to $5.2) $0.6 to $0.9a $7.6 to $9.5 $41.2a

Source: Negative or positive savings estimates were derived from responses to data collection instruments sent to cognizant managers 

in these organizations. DOE headquarters offices indicated no staffing changes for the first three scenarios and we did not estimate 

them in the fourth scenario. 

Note: Dollar values were derived by multiplying the number of FTEs (either projected safety and 

health position increases in scenario 1, or position decreases in the other scenarios) by the average 

cost of an FTE as reported for each location. 

a

Totals do not add up because of rounding. 

Projected changes in safety and health costs for the first three scenarios 

were derived from responses to our survey of DOE field offices and M&O 

contractors. Headquarters offices did not project any staffing changes 

under the first three scenarios. For scenario 4, we calculated changes in 

DOE’s field staff by applying NASA’s safety and health staffing approach 

(i.e., reducing safety and health field FTEs to one per laboratory). In 

calculating potential changes for M&O contractor staff, we determined 

that the Jet Propulsion Laboratory’s safety and health staffing levels were 

about 28 percent less than at DOE’s Lawrence Berkeley National 

Laboratory, even after DOE had adjusted staffing figures downward to 

account for differences in personnel functions at the two laboratories.15

 15 In the DOE Best Practices Pilot Study report, DOE adjusted the safety and health 

staffing figure downward from 150 to 41 at the Berkeley Lab and from 50 to 40 at 

Jet Propulsion Laboratory. 
Page 9 GAO-03-633R External Regulation of DOE

For example, DOE excluded its own safety and health personnel involved 

in radiation safety and environmental radiation monitoring, health 

services, and fire protection because it was determined that these 

functions were not performed by the safety and health personnel at the Jet 

Propulsion Laboratory. We then applied the 28 percent reduction to each 

of the 10 DOE science laboratories to estimate potential savings, although 

the potential for this reduction would vary among the laboratories, 

depending on the circumstances presented. We did not calculate any staff 

changes for DOE headquarters. 

Implementing scenario 4 could potentially provide the greatest savings to 

offset the transition costs and the annual cost increases anticipated for 

additional NRC and OSHA personnel under external regulation. 

Implementing this scenario, however, would also require the most 

dramatic changes in DOE’s oversight culture, particularly in contract 

administration and the responsibilities placed on safety and health 

personnel. Our analysis suggests that, to a large extent, the safety and 

health staffing levels across DOE field offices and the M&O contractors 

are driven by the need to monitor and respond to the numerous safety and 

health contractual reporting requirements and ad hoc information 

requests. Eliminating unnecessary information requests after shifting to 

external regulation could justify a reduction or redirection of safety and 

health personnel that would lower safety and health costs. 

DOE has recognized the need to fundamentally change its contract 

administration process to improve contractor efficiency and effectiveness 

and to enhance accountability. In April 2002, DOE formulated principles to 

guide the development of pending contracts with three science 

laboratories.16 The management practices at NASA’s Jet Propulsion 

Laboratory were used to support these principles. One of the principles 

calls for reliance on national standards to establish contractor 

requirements and performance criteria, while minimizing the use of DOE 

orders and directives that place administrative and operational 

requirements on the contractor. Applying this principle alone, in 

conjunction with adopting external regulation, would help to move DOE 

toward the potential safety and health savings projected in scenario 4. 

 16 Memorandum for Heads of Departmental Elements, the Under Secretary of Energy, 

Robert G. Card, Principles for Office of Science Laboratory Contracts, Department of 

Energy: April 30, 2002. 
Page 10 GAO-03-633R External Regulation of DOE

We provided a draft of this report to DOE for its review and comments. 

Written comments are presented and evaluated below and are reprinted in 

enclosure II. In commenting on our report, the Deputy Secretary of Energy 

expressed several concerns about our analysis and the need to shift to 

external regulation. For example, DOE commented that because our cost 

estimates were not independently verified, they are not “decision-quality 

information.” Other comments pertained to our estimates of department 

savings in safety and health costs after shifting to external regulation of 

the science laboratories. For example, DOE questioned our calculation of 

potential reductions in safety and health costs and the level of information 

necessary to monitor these activities. Finally, DOE raised some concerns 

about transition costs and other potential costs associated with shifting to 

external regulation. While we agree that our assessment of safety and 

health costs for the department was hindered by limitations in the 

availability of budget quality data, our method of estimating these costs 

was reasonable. Further, given the uncertainties about future roles, 

responsibilities and interactions among DOE and its M&O contractor 

safety and health personnel after shifting to external regulation, providing 

a range of savings estimates based on a combination of survey responses 

from the individuals responsible for these activities and our own 

calculations, make us confident that our assessment is independent and 

credible. Finally, while we were not asked to assess the transition costs 

and other potential costs and benefits of shifting to external regulation in 

this report, we have discussed these issues in previous reports. At this 

point, with the analysis undertaken on this issue over the years, it seems to 

us that philosophical opposition rather than data limitations is the main 

stumbling block to the department’s shift to external regulation. Our 

specific comments to each of the concerns raised by DOE are in 

enclosure II. 

To obtain information on the cost of safety and health activities and on the 

potential for reductions under different DOE oversight scenarios, we 

relied for the most part on data collection instruments that we sent to 

DOE and M&O contractor officials associated with the 10 science 

laboratories. We also visited NASA’s Jet Propulsion Laboratory, a federally 

funded research and development center that we selected because it is 

comparable to DOE’s science laboratories and because the department 

has already used it as a performance benchmark. In addition, we obtained 

safety and health cost data from centralized data systems to compare with 

our survey data. We did not independently verify the accuracy of the selfreported data, nor did we undertake an independent study of the current 

and proposed safety and health staffing levels for DOE and its contractors, 

Agency Comments 

Scope and 

Methodology 
Page 11 GAO-03-633R External Regulation of DOE

or of the proposed additions to NRC and OSHA staffs. We did, however, 

compare responses among the laboratories and follow up with 

respondents when necessary. We also encouraged narrative explanations 

of the responses. To obtain additional information, we spoke with DOE 

headquarters and field office officials. We conducted our work between 

August 2002 and March 2003 in accordance with generally accepted 

government auditing standards. 

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

others upon request. In addition, the report will be available at no charge 

on the GAO Web site at http://www.gao.gov. 

If you or your staff have any questions about this report, please contact me 

at (202) 512-3841 or Dan Feehan, Assistant Director, at (303) 572-7352. 

Major contributors to this report include Joel Grossman, Thomas Laetz, 

Mehrzad Nadji, Cynthia Norris and Michael Sagalow. 

Robin Nazzaro 

Director, Natural Resources 

 and Environment 

Enclosure 
Enclosure I: Briefing Slides 

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Enclosure II: Comments from 

the Department of Energy 

Page 35 GAO-03-633R External Regulation of DOE

Enclosure II: Comments from the 

Department of Energy 

Note: GAO comments 

appear at the end of this 

appendix. 
Enclosure II: Comments from 

the Department of Energy 

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Enclosure II: Comments from 

the Department of Energy 

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the Department of Energy 

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the Department of Energy 

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Enclosure II: Comments from the Department of Energy 

Page 40 GAO-03-633R External Regulation of DOE

The following are GAO’s comments on the Department of Energy’s letter dated 

April 28, 2003. The number associated with each of our comments corresponds to the 

numbered DOE statement in this enclosure. 

1. We agree that any reductions in safety and health costs under the first three 

oversight scenarios would at best offset anticipated increases in staffing at NRC 

and OSHA. However, we disagree that these estimates are questionable. Our 

estimates were derived directly from survey responses provided to us by DOE and 

M&O contactor safety and health managers who are in the best position to 

provide these data. The fourth scenario, which did not rely on survey responses 

conditioned by DOE’s oversight culture, yielded much higher potential reductions 

in safety and health costs. These savings would go well beyond offsetting 

increases in NRC and OSHA costs, but only if they are not shifted to other 

functional areas of the department and its M&O contractors. 

2. We agree with the two propositions extracted by DOE from our report that are 

behind the potential savings of up to $41 million calculated in scenario 4. We 

believe that these propositions are reinforced by DOE’s current policy guidance 

for developing new science laboratory contracts. This guidance underscores the 

use of national standards to establish contractor requirements and performance 

criteria, while minimizing the use of DOE orders and directives as mechanisms for 

placing administrative and operational requirements on the contractors. 

3. We agree that our report did not include any specific examples of “unnecessary” 

DOE reporting requirements. However, we disagree that there was no analysis to 

support our claim that these requirements and ad hoc information requests drive 

the apparent high levels of safety and health staffing. We compared the number of 

information requests from NASA to its Jet Propulsion Laboratory with those from 

DOE to its 10 science laboratories. The Jet Propulsion Laboratory had 

significantly fewer information requests than the DOE laboratories because NASA 

essentially relies on the information requested by external regulators, and their 

oversight, as well as the Jet Propulsion Laboratory’s self-assessments for safety 

assurances. If this laboratory’s total information demand equaled the information 

requested of DOE’s M&O contractors, one would expect that the number of staff 

necessary to respond to these requests would be similar. However, the Jet 

Propulsion Laboratory and the NASA Management Office at this laboratory have 

far fewer safety and health personnel as a proportion of their workforces than at a 

comparable DOE science laboratory and its associated field offices. 

GAO Comments 
Enclosure II: Comments from the Department of Energy 

Page 41 GAO-03-633R External Regulation of DOE

4. DOE’s concern that three entities (DOE, NRC, and OSHA) will each request 

information under external regulation gets at a root concern expressed by most of 

the M&O contractors that the department will not fundamentally alter its 

oversight approach even with the presence of external regulators. Scenario 4 

shows that the Jet Propulsion Laboratory is able to respond to the information 

requests of its external regulators and NASA overseers with 28 percent fewer 

safety and health personnel than a comparable DOE science laboratory, even after 

significantly reducing the number of pertinent DOE laboratory personnel (i.e., 

from 150 to 41) to account for differences in the types of hazards overseen in the 

respective laboratories. And, as reported by DOE, the Jet Propulsion Laboratory 

does this while maintaining comparable levels of safety to its Lawrence Berkeley 

National Laboratory. 

5. We agree that DOE can address to some extent the issue of “unnecessary” 

information requests under existing self-regulation. However, we disagree that 

shifting to external regulation is “far from the most plausible mechanism through 

which unnecessary information requests may be eliminated.” (See response to 

comment 6.) 

6. We disagree that shifting to external regulation will make it harder rather than 

easier to eliminate unnecessary information requests. Shifting to external 

regulation should help clarify what DOE reporting requirements and other 

information requests are duplicative of the information needs of external 

regulators. Applying a NASA-type oversight approach will also help uncover those 

administrative mechanisms to ensure a safe and healthy work environment that 

are unnecessary given the presence of external regulators. 

7. We pointed out in our report that the potential for a 28 percent reduction in safety 

and health personnel would vary among the laboratories, depending on the 

circumstances presented. That is, for some laboratories a higher percent 

reduction in M&O contractor safety and health personnel might be achieved, and 

for other laboratories a lower percent reduction would be possible. Applying this 

percentage to reduce safety and health costs across the 10 laboratories is actually 

more conservative than the 30 percent reduction in costs estimated by DOE’s 

major M&O contractors in one of our previous reports. We were told that this 

latter estimate is only achievable if DOE relinquishes its oversight to external 

regulators. It also takes into consideration the Oak Ridge National Laboratory, 

which would likely have the greatest regulatory presence of NRC under external 

regulation. 

8. We agree that safety and health cost information is based primarily on responses 

to our data collection instruments. We relied on survey data because DOE does 

not have budget quality information on safety and health costs. We disagree with 

DOE that our cost information does not represent decision-quality information; 

given the steps we took to determine the reasonableness of the data, including 
Enclosure II: Comments from the Department of Energy 

Page 42 GAO-03-633R External Regulation of DOE

making cost adjustments where necessary based on follow-up conversations with 

respondents. 

9. We agree that it would be difficult to determine how much of the transition costs 

to bring the laboratories into compliance with NRC and OSHA standards could be 

attributable to upgrading these laboratories to meet DOE’s own standards. DOE 

stated that there was no basis for assuming that much of the transition costs 

would be needed to meet the department’s own standards and that any such 

determination could not be verified. DOE also contends that its safety and health 

standards meet or exceed those of NRC and OSHA, but that it achieves acceptable 

levels of safety by means other than those that would be imposed under external 

regulation. We acknowledge that the full cost of transitioning to external 

regulation cannot be ascertained until the completion of comprehensive 

compliance audits involving DOE, NRC, and OSHA for the 10 science laboratories. 

However, based on previously reported information, we believe that some of the 

transition costs will be associated with complying with DOE’s own regulations. 

DOE even stated in its Implementation Plan for External Regulation of the NonDefense Science Laboratories that some of the transition costs would be 

necessary to cover the backlog of preventive facility maintenance that presumably 

are in noncompliance with its own standards. 

10. A review of DOE’s Integrated Safety Management System was beyond the scope 

of our report. We note, however, that officials at the Jet Propulsion Laboratory 

told us that they also have an established integrated safety management system 

operating within the context of external regulation. We believe that the 

reasonable application of regulations to reflect activities and hazards associated 

with a particular work environment is appropriate and not automatically 

eliminated with external regulation, as seen at the Jet Propulsion Laboratory. We 

have also reported that NRC claims it would be flexible in applying its standards 

to DOE’s unique facilities without compromising safety, and OSHA has concluded 

that any deficiencies identified at the laboratories would be similar to levels found 

in the private sector and, therefore, manageable. 

11. We agree that characterizing the laboratories under the stewardship of DOE’s 

Office of Science as military or nonmilitary does not fully capture the scope of 

research taking place at them. However, we provided the questioned footnote to 

clarify for some readers that the science laboratories have been referred to in 

other ways. For example, the current version of H.R. 6 – The Energy Policy Act of 

2003, uses the phrase “nonmilitary energy laboratories.” However, because DOE 

has itself referred to the science laboratories as “nondefense” science laboratories 

in its implementation plan for external regulation, we have further clarified the 

footnote by adding “nondefense science” laboratories. 

12. We did not perform a cost benefit analysis of shifting to external regulation of the 

science laboratories in this report, and we still question the need to do so. As we 
Enclosure II: Comments from the Department of Energy 

Page 43 GAO-03-633R External Regulation of DOE

previously reported, in our view “DOE has sufficient information and has had 

ample time to move forward on external regulation.” At this point, it appears to us 

that philosophical opposition rather than data limitations is the principal 

impediment to a shift to external regulation. Besides, while some costs and 

potential beneficial savings are reasonably quantifiable, others are not. For 

example, attempting to quantify the cost of any potential decrease in our national 

security by shifting to external regulation would be as difficult as trying to 

quantify the benefits of increased public trust in DOE that might be gained by 

eliminating self-regulation of safety and health functions. As to national security 

concerns, we would add that we previously reported that officials at comparable 

foreign defense and nondefense laboratories, all of which accept the presence of 

external regulators, indicated that they do not share DOE’s concern that external 

regulation poses a threat to their national security. In addition, our present report 

identifies at least one oversight scenario that might yield significant savings in 

safety and health costs that could potentially help support additional research to 

enhance our national security. 

(360257) 
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