Chemical Weapons: Better Management Tools Needed to Guide DOD's Stockpile Destruction Program
Published: 2003-10-30T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: Since its inception in 1985,the Chemical Demilitarization (Chem-Demil) Program has been charged with destroying the nation's large chemical weapons stockpile. After years of planning and building new facilities, the program started destroying the stockpile in 1990. As of October 2003, the program had destroyed 26 percent of the 31,500-ton agent stockpile, and its total estimated cost to destroy the entire stockpile is more than $25 billion. This testimony summarizes GAO's September 2003 report and addresses the following issues: (1) the status of schedule milestones and cost estimates, (2) the impact of the current schedule on the Chemical Weapons Convention (CWC) deadlines, (3) the challenges associated with managing the program, and (4) the status of the Chemical Stockpile Emergency Preparedness Program (CSEPP).
section_title: What GAO Found
paragraphs: The Chem-Demil Program faces schedule delays and higher costs, but it has improved emergency preparedness in communities near the sites. In 2001, the Chem-Demil Program extended its schedule milestones and increased its cost estimates from $15 billion to about $24 billion. Since then nearly all sites have experienced delays,stemming from problems such as: plant safety issues,environmental requirements, approving emergency preparedness plans, and funding shortfalls. The program needs a risk management plan to mitigate problems affecting program schedules, costs, and safety. Program officials say the delays have raised the cost estimates by an additional $1.4 billion, to more than $25 billion as of September 2003. Based on current schedule slippages, GAO believes that costs will grow higher and further delays will occur. Because of schedule delays, the United States will not meet CWC's April 2004 deadline to destroy 45 percent of the stockpile and it risks not meeting the original 2007 deadline to complete destruction of the entire stockpile. Unless the program fixes the problems causing delays,the United States also risks not meeting CWC's deadline of 2012, if extended. The program has suffered from several long-standing management and organizational issues. The lack of sustained leadership has undercut decision-making authority and obscured accountability. The program's complex structure, with multiple lines of authority, has left roles and responsibilities unclear. It does not have an overarching, comprehensive strategy to guide and integrate its activities and monitor its performance. The Army and the Federal Emergency Management Agency have helped state and local communities become better prepared to respond to chemical emergencies. Despite these gains, CSEPP costs are rising because some states have expanded their preparedness requests beyond the approved budgets. These requests amount to $88 million for fiscal years 2004 and 2005.

section_title: Letter
paragraphs: I appreciate the opportunity to participate in this hearing today on the  Department of Defense’s (DOD) Chemical Demilitarization (Chem-Demil)  Program. Since its inception in 1985, this program has been charged with  destroying the nation’s large chemical weapons stockpile, second only to  Russia’s in terms of its size. After years of planning and building new  facilities, the program started destroying the stockpile in 1990.
As you requested, my statement focuses on the following issues: (1) the  status of schedule milestones and costs at the sites, (2) the impact that the  current schedule may have on the Chemical Weapons Convention (CWC)  deadlines, (3) the challenges associated with managing the program, and  (4) an update on the status of the Chemical Stockpile Emergency  Preparedness Program (CSEPP).
As of October 2003, the Chem-Demil Program had destroyed an estimated  8,210 tons (26 percent) of the total 31,500 tons of the original agent  stockpile stored at nine sites in the United States and the Pacific Ocean  at Johnston Atoll. Of the four sites that have begun agent destruction  operations, Johnston Atoll has destroyed all of its stockpile; Tooele, Utah,  has reduced its stockpile by about 44 percent; Anniston, Alabama, has  destroyed about 2 percent of its stockpile; and Aberdeen, Maryland, has  eliminated over 3 percent of its stockpile. Current schedule estimates  show that the Army will not complete destruction of the entire stockpile  until after the year 2012.
Since 1990, we have issued more than 25 reports on the Chem-Demil  Program. Nearly half of the reviews have raised questions about the  program’s growing costs, its inability to meet its schedule milestones,  and its management weaknesses.
My testimony today draws heavily from our most recent report, which was  issued in September 2003. In summary, we found the following:
While the Chem-Demil Program has revised its schedule milestones and  increased its cost estimates several times, with the latest revision in 2001,  the program still cannot meet them. According to current Army schedules  for destruction, five sites will miss their 2001 schedule milestones, less  than 2 years after they were reset. The other four sites have not yet missed  schedule milestones, but they too have experienced delays. Most of the  substantial delays have stemmed from problems that DOD and the Army  have been unable to anticipate or influence. These include plant safety  issues, difficulties in meeting environmental permitting requirements,  public concerns about emergency preparedness plans, and funding  shortfalls. Neither DOD nor the Army has adopted a comprehensive risk  management approach that could help mitigate potential problems that  affect program schedules, costs, and safety by anticipating problems and  developing mitigation plans. Army officials told us they are now  developing such an approach. According to program officials, the delays  that have occurred since the 2001 schedule revisions, along with the  resolution of emergency preparedness issues, have raised the program’s  cost estimates by $1.4 billion, to a current total of more than $25 billion.  We expect this amount will grow substantially before the destruction of  the stockpile is complete if these delays continue.
Because of schedule delays, the United States will not meet CWC’s  April 2004 deadline to destroy 45 percent of the chemical stockpile. The  United States recently asked the governing body of the convention for an  extension beyond the April 2004 deadline. If the delays that the program  has experienced continue, the United States also risks not meeting the  2007 deadline to destroy 100 percent of the stockpile. Unless the  Chem-Demil Program is able to fix the problems that have caused these  delays, the United States also risks not meeting CWC’s deadline, if  extended to 2012, to destroy the entire stockpile. The CWC allows  extensions of up to 5 years to the 2007 deadline.
Despite recent efforts to improve the management and streamline the  organization of the Chem-Demil Program, the program has suffered from  several long-standing and unresolved leadership, organizational, and  strategic planning issues. The program has lacked sustained leadership at  both the upper levels of oversight and at the program-manager level,  which undercuts decision-making authority and obscures accountability.In addition, the program’s complex management structure, with multiple  lines of authority within the Army and the separation of program  components among the Army, DOD, and the Federal Emergency  Management Agency (FEMA), has left roles and responsibilities for the  different parts of the program unclear. FEMA manages the emergency  preparedness program (CSEPP) for communities near the storage sites.  Finally, the absence of an overarching, comprehensive strategy has  resulted in a program without a clear road map to closely guide and  integrate all of its activities and monitor its performance.
Since our 2001 report, the Army and FEMA have helped state and local  communities become better prepared to respond to chemical emergencies.  Based on the states’ self-assessments and FEMA’s reviews, all of the states  with nearby chemical storage sites are considered close to being fully  prepared for emergency issues. However, despite these accomplishments,  CSEPP costs continue to rise because some state and local communities  have expanded their emergency preparedness requests beyond their  approved budgets, exceeding them by $88 million for fiscal years 2004 and  2005, especially as they move closer to agent operations phase. FEMA and  the Army have implemented a number of recommendations we made to  improve technical assistance and guidance, training, and compliance  measures to assess preparedness.
subsections: section_title: Most Sites Will Miss Schedule Milestones due to Program’s Inability to Anticipate and Influence Issues
paragraphs: Despite several revisions to schedule milestones since the program’s  inception, the Chem-Demil Program still is unable to meet these  milestones because of unanticipated delays. Most incineration sites have  missed important milestones established in 2001. Delays at Anniston,  Umatilla, and Pine Bluff have already resulted in their missing the  2001 schedule milestones to begin chemical agent destruction operations  (operations phase). Johnston Atoll has missed its schedule milestone  for shutting down the facility (closure phase). Although Tooele has not  missed any milestones since the 2001 schedule was issued, the site has  undergone substantial delays in destroying its stockpile primarily because  of a safety-related incident in July 2002. If additional delays occur at the  Tooele site, it could also exceed its next milestone as well. Table 1 shows  the status of the incineration sites that will miss 2001 schedule milestones.
Many of the recent delays at the incineration sites have resulted from  operations incidents, from environmental permitting problems,  community protection concerns, and funding issues—a trend that we  identified in previous reports on the program. Among the events that have  caused delays at incineration sites since 2001 are the following:
Incidents during operations. At Tooele, a chemical incident involving a  plant worker who came into contact with a nerve agent while performing  routine maintenance led to the suspension of agent destruction operations  from July 2002 to March 2003. An investigation attributed the incident to  inadequate or poorly followed worker safety procedures, and a corrective  action plan, including an improved safety plan, was instituted before  operations resumed. Since operations restarted in March 2003, Tooele has  experienced several temporary shutdowns.
Environmental permitting. Several environmental permitting issues have  delayed the start of agent destruction operations at sites at Umatilla and  Anniston. At Umatilla, the delays stemmed from several unanticipated  engineering changes related to reprogramming software and design  changes that required permit modifications and to a shutdown by state  regulators because furnaces were producing an unanticipated high amount  of heavy metals during surrogate agent testing. At Anniston, delays  occurred because state environmental regulators did not accept test  results for one of the furnaces because the subcontractor did not follow  state permit-specified protocols.
Community protection. Concerns about emergency preparedness for  local communities have led to additional delays at Anniston. These  concerns included the inadequacy of protection plans for area schools and  for special needs residents (e.g., elderly and disabled individuals) who  would have difficulty in an evacuation. Although we reported on this issue  in July 1996 and again in August 2001, and a senior DOD official identified  it as a key concern in September 2001, the Army had difficulty  satisfactorily resolving the issue with key state stakeholders. As a result,  operations did not begin until August 2003.
Funding. Delays at Pine Bluff and Johnston Atoll occurred because  DOD redirected fiscal year 2002 destruction program funds to acquire  $40.5 million worth of additional emergency protection equipment for  Anniston. To cover this unfunded budget expense, the Army reduced  Pine Bluff’s budget by $14.9 million and Johnston Atoll’s budget by  $25.1 million, leading to systemization and closure milestone slippages,  respectively, at these sites. Program officials told us that the total cost of  this schedule slip would ultimately be $116 million due to the extended  period before closure. The program is likely to face unfunded  requirements as programwide funding requests continue to exceed  budgeted amounts. As of October 2003, according to preliminary  estimates from FEMA, unfunded CSEPP requirements for all sites are  expected to amount to $39.4 million and $49.0 million for fiscal years 2004  and 2005, respectively.
Unlike the incineration sites, the two bulk-agent only sites, Aberdeen and  Newport, have experienced delays but have not breeched their schedule  milestones. In 2002, DOD approved using an alternative technology  (neutralization), instead of incineration, at these two sites. This technology  is expected to accelerate the rate of destruction at these two sites. The  Army estimated that this process would reduce the scheduled end of  operations at both sites by 5 years, from 2008 to 2003 at Aberdeen and  from 2009 to 2004 at Newport. However, Aberdeen has encountered  unanticipated problems with the removal of residual agent from bulk  containers and has extended its planned completion date by 6 months,  from October 2003 to March 2004. In addition, Newport has faced  construction delays and community resistance to offsite treatment of  waste byproducts. As a result of these delays, Newport has extended its  planned start date for agent operations by 5 months, from October 2003 to  February 2004.
At two sites, Pueblo, Colorado, and Blue Grass, Kentucky, no milestones  were set in the 2001 schedule because DOD had not yet selected a  destruction technology. DOD has now selected a destruction technology  for these sites, but it made decisions several months later than estimated.  More importantly, DOD has set initial schedule milestones for these  two sites that go beyond the extended April 2012 CWC deadline.  According to DOD officials, these milestones are preliminary and will be  reevaluated once contractors finish initial facility designs.
The Chem-Demil Program has faced continued delays with the program  largely because DOD and the Army have not yet developed a risk  management approach to proactively anticipate and address potential  problems that could adversely affect program schedules, costs, and safety.  Such an approach could also leverage knowledge of potential problems  gained at other sites. Instead, according to a DOD official, the program has  used a crisis management approach, which has forced it to react to, rather  than control, issues. The program had drafted a plan in June 2000 that was  intended to address these issues. However, according to a program  official, this plan was never approved or implemented because of a change  in management in 2001.
The delays and schedule extensions have contributed directly to program  cost growth, according to program officials. As a result, DOD’s total  program cost estimate grew from $15 billion to $24 billion between 1998  and 2001. (See fig. 1.) Because of delays encountered since the 2001  revisions, the Army is now in the process of developing new milestones  that will extend beyond those adopted in 2001. According to an Army  official, the program will use events that have occurred since 2001 in  presenting new cost estimates to DOD for preparation of the fiscal year  2005 budget submission. Program officials told us that they estimate new  costs had increased by $1.4 billion as of October 2003, and this estimate is  likely to rise further as additional factors are considered.
section_title: Schedule Delays Jeopardize Ability of Program to Meet CWC Deadlines
paragraphs: Although the United States met the first two chemical weapons treaty  deadlines, the continuing delays jeopardize its ability to meet the final  two deadlines. (See table 2.) Since reaching the 2002 deadline to destroy  20 percent of the stockpile in July 2001, the Chem-Demil Program has been  able to destroy only an additional 3 percent of the stockpile. In order to  meet the April 2004 CWC deadline to destroy 45 percent of the stockpile,  the program would have to eliminate an additional 22 percent of the  stockpile within the next 6 months. Because the program will likely not be  able to achieve this rate of destruction, the United States has asked for an  extension of the 2004 deadline.
According to current destruction schedules, the United States will not  meet the 2007 deadline to eliminate 100 percent of the stockpile. As a  result, the United States will likely have to ask for an extension of the 2007  deadline to complete the destruction of the entire stockpile. The CWC  allows extensions of up to 5 years beyond the 2007 deadline. Unless the  program fixes the problems that are causing schedule delays, the United  States also risks not meeting this deadline, if extended to 2012.
section_title: Long-standing Management and Organizational Weaknesses Hamper Program Progress
paragraphs: Despite recent efforts to improve the management and streamline the  organization of the Chem-Demil Program, the program continues to falter  because several long-standing leadership, organizational, and strategic  planning weaknesses remain unresolved. The lack of sustained leadership  has undercut decision-making authority and obscured accountability. The  program’s complex structure, with many lines of authority, has left roles  and responsibilities unclear. Finally, the program lacks an overarching,  comprehensive strategy to guide and integrate its activities and monitor  performance.
subsections: section_title: Leadership Shifts Affect Continuity in Decision Making
paragraphs: The Chem-Demil Program’s lack of sustained leadership above the  program level is underscored by the multiple shifts in oversight  responsibilities that have occurred three times between DOD and the  Army during the past two decades. The most recent change took place in  2001 when oversight responsibility for the program shifted back to DOD’s  Office of the Secretary of Defense. Table 3 summarizes the changes.
These shifts in oversight responsibilities affected the continuity of  program decision making and obscured accountability. As a different  office assumed major decision authority, the program’s emphasis  shifted and initiatives that had been started were often not completed.  For example, when the Army had oversight responsibility for the program,  it established a memorandum of understanding with FEMA to clarify each  of their roles and responsibilities related to CSEPP. However, after DOD  assumed the program’s oversight responsibilities in 2001, DOD did not  follow the protocols for coordination that had been established in the  memorandum, according to FEMA and DOD officials. As a result, DOD  provided funds for emergency preparedness items without having  adequate plans for distribution, which delayed the process. This shift in  oversight responsibilities from the Army to DOD also left state and local  community officials and other stakeholders uncertain as to the credibility  of federal officials. According to FEMA and Army officials, coordination  between the two agencies has improved in the last few months and efforts  are being made to repair relationships with community and state  stakeholders.
Similar problems have also occurred within the Army as program  leadership has changed. Three different officials at the Assistant Secretary  level have held senior leadership positions since December 2001. In  addition, five officials have served as the Deputy Assistant Secretary of the  Army (Chem-Demil) during that time. From April 2002 to February 2003,  the program manager’s position remained vacant for nearly 1 year, before  being filled. However, after only 4 months, the program manager resigned  and the Army named a replacement.
Frequent shifts in key leadership positions have led to several instances  where the lack of continuity affected decision making and obscured  accountability. For example, in June 2002, a program official promised to  support future funding requests for emergency preparedness equipment  from one community, but his successor did not fulfill this promise. Other  communities viewed the agreement with one community as an opportunity  to substantially expand their own funding requests. The lack of sustained  leadership makes it unclear who is accountable when program  commitments are made and not fulfilled. Moreover, when key leaders do  not remain in their positions to develop the needed long-term perspective  on program issues and effectively implement program initiatives, it is  difficult to maintain program progress and ensure accountability for  leadership actions.
section_title: Program Management Structure Remains Complex
paragraphs: As our 2003 report documents, the Army recently reorganized the  program. But this change in management structure has not streamlined  the program’s complex organization nor clarified roles and  responsibilities. The establishment of the Chemical Materials Agency  (CMA) in January 2003 has left the Director reporting to two different  senior Army organizations, which is one more than under the previous  structure. This divided reporting approach is still not fully developed,  but has the potential to adversely affect program coordination and  accountability. The reorganization has also divided the responsibility  for various program phases between two offices within CMA. One  organization, the Program Manager for the Elimination of Chemical  Weapons, will manage the first three phases (design, construction, and  systemization) for each site, and a newly created organization, the  Director of Operations, will manage the final two phases (operations and  closure). This reorganization changes the cradle-to-grave management  approach that was used to manage sites in the past and has blurred  responsibilities for officials who previously provided support in areas  such as quality assurance and safety. Moreover, the reorganization did  not address two program components—Assembled Chemical Weapons  Alternatives (ACWA) program and community-related CSEPP. DOD will  continue to manage ACWA separately from the Army, as congressionally  directed. In addition, the Army will continue to manage CSEPP jointly  with FEMA.
section_title: Program Lacks Strategy and Implementation Plan
paragraphs: While DOD and the Army have issued numerous policies and guidance  documents for the Chem-Demil Program, they have not developed an  overarching, comprehensive strategy or an implementation plan to guide  the program and monitor its progress. This is contrary to the principals  that leading organizations embrace to effectively implement and manage  programs. Some key aspects of an approach typically used to effectively  manage programs include promulgating a comprehensive strategy that  includes a clearly stated mission, long-term goals, and methods to  accomplish these goals. An implementation plan that includes annual  performance goals, measurable performance indicators, and evaluation  and corrective action plans is also important. According to DOD and Army  officials, the Chem-Demil Program has relied primarily on guidance and  planning documents related to the acquisition process. However, in  response to our recent recommendation that they prepare such a strategy  and plan, DOD stated that it is in the initial stages of doing so and  estimates completion in fiscal year 2004.
section_title: Emergency Preparedness Program Is Improving, but Costs Are Rising
paragraphs: Since our 2001 report, the Army and FEMA have assisted state and  local communities to become better prepared to respond to chemical  emergencies. Based on the states’ self-assessments and FEMA’s reviews,  all 10 states with chemical storage sites located within them or nearby are  now considered close to being fully prepared to respond to a chemical  emergency. This is a marked improvement from the status we reported in  2001 when 3 states reported that they were far from being prepared. Now,  6 of the 10 states are reporting that their status is fully prepared and the  remaining 4 are close to being fully prepared. However, these statuses are  subject to change because the states and communities themselves can  revise or expand their agreed-upon emergency preparedness needs. They  can make these changes because the “maximum protection” concept that  governs CSEPP is open to interpretation. As a result, they can appear to be  less prepared than before. For example, Oregon certified that it was fully  prepared, but now has requested additional emergency equipment. This  request has changed Oregon’s self-reported preparedness status from fully  prepared to incomplete.
Despite these accomplishments, CSEPP costs continue to rise because,  according to Army and FEMA officials, state and local communities may  add to their emergency requirements beyond approved requests. Army and  FEMA officials explain that the states often identify and expand their  requirements, especially as destruction facilities move closer to the start  of the operations phase. For example, the states of Colorado, Alabama,  and Oregon have all requested funds for infrastructure, including roads  and bridges. In June 2002, Oregon certified that its community readiness  was adequate and recommended permit approval to allow test burns at  Umatilla. Since that time, Oregon has asked for additional emergency  preparedness support that exceeds its CSEPP budget. This request follows  a pattern of substantially increasing funding requests at the start of the  operations phase, as occurred at Anniston in 2001 when it received  $40.5 million for additional CSEPP items. Programwide, new requirements  continue to exceed approved CSEPP funding levels. FEMA has little  control over the additional funding requests made by the states. As of  October 2003, FEMA had identified $39.4 and $49.0 million in unfunded  requirements for fiscal years 2004 and 2005, respectively. (See table 4.)
In our August 2001 report, we recommended that the Army and FEMA  (1) provide technical assistance, guidance, and leadership to the three  states (Alabama, Indiana, and Kentucky) with long-standing emergency  preparedness issues to resolve their concerns; (2) provide all states and  their communities with training and assistance in preparing budget and  life-cycle cost estimates and provide guidance and plans on reentry; and  (3) establish specific measures of compliance with the benchmarks to  more evenly assess performance and to correctly identify requirements.  The Army is continuing to provide assistance to CSEPP states and  communities as requested by FEMA. FEMA now participates more often  in local community CSEPP activities and sponsors an annual CSEPP  conference in an effort to improve its working relationships. FEMA  has also provided software to simplify development of CSEPP financial  reporting documents and has published a Reentry and Recovery  Workbook. The workbook fills a void in state and local guidance for  emergency responders to follow in the event of a chemical emergency.  Lastly, FEMA expanded its capability assessment readiness tool to assist  local communities in quantifying benchmark scores.
section_title: Agencies’ Actions to Implement Prior GAO Recommendations
paragraphs: We recommended in our September 2003 report that the Secretary of  Defense direct the Under Secretary of Defense for Acquisition,  Technology and Logistics, in conjunction with the Secretary of the Army,  to (1) develop an overall strategy and implementation plan for the  chemical demilitarization program and (2) implement a risk management  approach that anticipates and influences internal and external factors that  could adversely impact program performance. DOD concurred with our  recommendations. It said that it was in the initial stages of developing an  overall strategy and implementation plan and estimated that it would be  completed in fiscal year 2004. It also said that CMA will review the  progress of an evaluation of several components of its risk management  approach within 120 days and then that DOD would evaluate the results  and determine any appropriate action. In our 2001 report, we  recommended that the Army and FEMA make improvements to the  program, and they have implemented those recommendations.
Mr. Chairman, this concludes my statement. I would be pleased to respond  to any questions that you or members of the Subcommittee may have.
For future questions regarding this testimony, please contact me at (202)  512-4300. Individuals making key contributions to this testimony include  Donald Snyder, Rodell Anderson, Bonita Oden, John Buehler, Nancy  Benco, and Mike Zola.
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