Nuclear Weapons: NNSA Has a New Approach to Managing the B61-12 Life Extension, but a Constrained Schedule and Other Risks Remain
Released: 2016-02-04T00:00:00

Letter

Background

This background section describes (1) objectives, milestones, and management considerations in the B61-12 LEP and (2) DOE directives and NNSA policy letters and how they apply to programs such as the B61-12 LEP.

B61-12 LEP Objectives, Milestones, and Management Considerations

The B61-12 consists of two major assemblies: the bomb assembly and the tail kit guidance assembly. NNSA manages the development and production of the bomb assembly and the Air Force manages the development and production of the tail kit assembly, among other activities, as follows:

NNSA responsibilities and the bomb assembly. According to NNSA officials and documents, the bomb assembly will include reused, refurbished, and new nuclear and nonnuclear components. The design approach for the LEP maximizes reuse of existing nuclear and nonnuclear components and is intended to improve the safety and security of the weapon using proven technologies. NNSA manages the development and production of the bomb assembly under the direction of a federal program office and federal program manager located at Kirtland Air Force Base in Albuquerque, New Mexico, which is also the site of NNSA’s Sandia National Laboratories. NNSA sites and laboratories involved in the LEP include Sandia National Laboratories, the design agency for nonnuclear components, a production agency for some components, and system- level integrator of the overall weapon design; Los Alamos National Laboratory, the design and production agency for the nuclear explosive package; the Kansas City National Security Campus, the Y- 12 National Security Complex, and the Savannah River Site, the production agencies for various new or refurbished weapon components; and the Pantex Plant, where some bomb components are produced and final assembly of the bombs takes place. In addition, Lawrence Livermore National Laboratory provides independent review of Los Alamos National Laboratory’s work on nuclear components. As of September 2015, NNSA’s expected costs for its share of the LEP work were approximately $7.3 billion.

Air Force responsibilities and the tail kit assembly. According to Air Force officials and documents, the tail kit assembly will provide the B61-12 with a guided freefall capability that improves the accuracy of weapon delivery. The guided capability will enable the weapon to meet military requirements with a lower nuclear yield, allowing for the use of less special nuclear material. The B61-12 is designed to be compatible with existing dual-capable aircraft—the F-15, F-16, and PA-200—as well as the B-2 strategic bomber and planned future aircraft such as the F-35 fighter. The Air Force’s responsibilities include integrating the B61-12 with its delivery aircraft and the operational flight program software. This software is being upgraded in the F-15 and B-2 delivery aircraft so that these aircraft can work with the B61-12’s digital interface. The Air Force Nuclear Weapons Center at Kirtland Air Force Base manages technical integration, system qualification, and other LEP-related tasks required to certify and field the weapon as well as tail kit acquisition, as contracted to Boeing. As of September 2015, the Air Force’s expected costs for its share of the LEP work were approximately $1.6 billion.

Figure 1 shows the B61-12.

The joint 6.X guidance describes key high-level joint tasks and deliverables for each phase of nuclear refurbishment activities such as an LEP. Specifically, the 6.X guidance lists key milestones, such as tests and cost estimates, that a nuclear weapon refurbishment activity must undertake before proceeding to subsequent steps of the Phase 6.X process (see fig. 2).

NNSA and DOD implement the Phase 6.X process under a guidance document, Procedural Guideline for the Phase 6.X Process, which was issued in 2000 and is undergoing its first revision. This document describes the roles and functions of DOD, DOE, and NNSA in nuclear weapon refurbishment activities conducted through the Phase 6.X process. It also describes the roles and functions of two joint bodies that provide oversight and approval functions to LEPs and other nuclear weapons–related activities: the Nuclear Weapons Council and its Standing and Safety Committee. In addition, the Nuclear Weapons Council charters a Project Officers Group for each weapon system to provide a technical forum for weapon development and management activities. Each Project Officers Group is led by a project officer from either the Navy or Air Force, the two military services that maintain and operate nuclear weapons. Importantly, for more detailed requirements and guidance on program management matters, DOE and DOD each utilize their own agency-specific directives.

In the B61-12 LEP’s current phase—6.3, development engineering— NNSA coordinates with the Air Force to conduct experiments, tests, and analyses to develop and validate the selected design option. Key steps that have not yet taken place in Phase 6.3 of the B61-12 LEP include formally developing a program cost baseline—a more mature cost estimate than is currently in use—and finalizing the design definition. Program officials told us they expect to issue the baseline cost report, which will formalize the program’s cost baseline, and to approve the baseline design in the third quarter of fiscal year 2016. According to program officials, the LEP is on schedule to enter Phase 6.4 (production engineering) in the fourth quarter of fiscal year 2016.

The B61-12 LEP is one of several LEPs or refurbishments that NNSA and DOD have plans to undertake or have already started. Other LEPs or refurbishments include the ongoing LEP for the W76 warhead, an alteration to the W88 warhead, and planned LEPs for the cruise missile and interoperable warheads. Some of these activities are or will be taking place concurrently, and several have had their completion dates revised over the years, as shown in table 1. In addition, NNSA plans to move important production operations into new or modified facilities during this time period. Because of overlapping LEPs and new infrastructure, NNSA and DOD officials told us that they recognize the need to continue to improve coordination and management of the nuclear security enterprise.

Earned value management is a project management tool developed by DOD in the 1960s to help managers monitor project risks. Earned value management systems measure the value of work accomplished in a given period and compare the measured value with the planned value of work scheduled for that period and the actual cost of work accomplished. Earned value management’s intended purpose is to integrate a project’s cost, schedule, and technical efforts for management and provide reliable data to decision makers.

DOE Directives, NNSA Policy Letters, and Their Applicability to Programs

DOE’s Departmental Directives Program, defined and established through a DOE order, classifies directives into several types. These directive types include orders and guides, which the Departmental Directives Program describes as follows:

Orders. Orders establish requirements and should include detailed instructions describing how requirements are to be implemented.

Guides. Guides provide information on how to implement the requirements contained in orders. They are a nonmandatory means for complying with these requirements and cannot be made mandatory by reference in other DOE directives.

The National Nuclear Security Administration Act, through which Congress established the NNSA, also gives the NNSA Administrator the authority to establish NNSA-specific policies, unless disapproved by the Secretary of Energy. NNSA does so through the issuance of policy letters. These policy letters take the form of NNSA policies, supplemental directives, and business operating procedures.

DOE manages the B61-12 LEP as a program. The department makes distinctions between programs and projects and uses different directives to prescribe the management approach for each, as follows:

Programs. According to NNSA officials, no DOE order exists that provides management requirements for program activities, such as LEPs. As we found previously in our November 2014 report on DOE and NNSA cost estimating practices, for example, DOE and NNSA programs were not required to meet any cost estimating best practices. NNSA officials stated at that time that NNSA cost estimating practices for programs were limited, decentralized, and inconsistent, and were not governed by a cost estimating policy or single set of NNSA requirements and guidance. According to these officials, each NNSA program office used different practices and procedures for the development of cost estimates that were included in the NNSA annual budget.

Projects. NNSA’s management of projects is governed by DOE Order 413.3B (DOE’s project management order). The order applies to capital asset projects above a certain cost threshold. It provides management direction for NNSA and other DOE offices, with the goal of delivering projects within the original performance baseline that are fully capable of meeting mission performance and other requirements, such as environmental, safety, and health standards. The order specifies requirements that must be met, along with the documentation necessary, to move a project past major milestones. It provides requirements regarding cost estimating (and, in some cases, the preparation of an independent cost estimate), technology readiness assessments, independent project reviews, and the use of earned value management systems, among other requirements. As we have previously found, DOE’s project management order applies to programs only in conjunction with a program’s acquisition of capital assets.

The Management Approach for the B61- 12 LEP Informed a New NNSA Program Management Policy for Defense Programs, but Potential Challenges Remain

The B61-12 LEP’s program managers have developed a management approach that was then used to inform a new NNSA policy that applies to NNSA defense program management. In addition, NNSA and DOD have identified some potential management challenges in the program; the new management approach and policy may help NNSA address these challenges, but it is too soon to evaluate the likelihood that they will adversely affect the program.

The B61-12 LEP Is Using a Management Approach That Informed New NNSA Policy for Defense Program Management

The B61-12 LEP’s program managers have developed, documented, and are using program management practices and tools for the LEP to help identify and avoid cost and schedule overruns and technical issues. As noted above, we have found in past reports that NNSA and DOD experienced program management challenges in LEPs, including the B61-12 LEP and the ongoing LEP for the W76 warhead. We made recommendations related to NNSA’s budget assumptions, cost tracking methods, and risk management plans and continue to monitor NNSA’s response. Since we issued those reports, the B61-12 LEP’s program managers developed a management approach for the program that draws on DOE directives and other sources, including our Cost Guide. For example, we found in our November 2014 report on NNSA project and program management that the B61-12 LEP’s managers used our Cost Guide, as well as direction under the Phase 6.X process and DOE’s project management order and cost guide, to develop their approach for developing cost estimates.

Several officials from both NNSA and DOD characterized the B61-12 LEP’s overall program management approach as improved over the approaches used in previous LEPs. This approach includes the following practices and tools: Improved management capability and authority. The B61-12 LEP’s program office has taken steps to improve management capability and authority. According to NNSA officials, the LEP successfully requested that the department enlarge its federal program office staff to provide more management capability. Specifically, the program office had 3 full-time equivalent (FTE) staff at the beginning of the program; as of October 2015, it has 8 FTEs, augmented by contractor staff of about 12 FTEs, according to program officials. Moreover, since 2014, the federal program manager said that he has successfully requested contingency and management reserve funds of $983 million over the life of the program—about 13.5 percent of NNSA’s estimated $7.3 billion total project cost—which he has authority to use to help manage the effects of realized risks or changes in funding, such as a continuing resolution.

An earned value management system. According to NNSA and DOD officials we interviewed, the B61-12 LEP is the first LEP to use earned value management, a tool that may help NNSA ensure that its work progresses on budget and on schedule. Each participating NNSA site is responsible for reporting earned value data monthly against the scope, schedule, and budget baselines established for each site’s activities. According to NNSA officials involved with the LEP, earned value management identifies schedule variances as they happen so that the program is aware of any work that may be progressing more slowly than expected and could go on to affect key milestones. Integrated master schedules. According to NNSA officials we interviewed, the B61-12 LEP is also the first NNSA defense program to summarize details from site schedules into a summary NNSA Integrated Master Schedule (NIMS) for work at the participating NNSA sites. The B61-12 LEP also has developed a top-level schedule that all program participants use, the Joint Integrated Master Schedule (JIMS). In past LEPs, according to the officials we interviewed, NNSA did not fully reconcile and integrate its individual sites’ schedules, which may have contributed to program delays and cost increases. The JIMS and other integrated master schedules are key tools in the B61-12 LEP’s schedule and risk management strategy, according to officials we interviewed. Integrated cost estimates. An official from NNSA’s Office of Cost Policy and Analysis told us that the B61-12 LEP is the first NNSA defense program to issue a cost estimate that integrates all participating sites’ costs into a single program cost estimate. In past LEPs, according to the official, NNSA did not integrate its individual sites’ cost estimates, which contributed to baseline costs being underestimated. Independent cost estimate. The official from NNSA’s Office of Cost Policy and Analysis told us that the office annually prepares and publishes an independent cost estimate for the NNSA portion of the B61-12 LEP to help inform the cost estimate prepared by the B61-12 LEP program manager. This estimate is prepared without reference to the program manager’s estimate and uses a different method. The estimate can then be compared to the program manager’s estimate to further refine it as the program develops the formal baseline cost estimate known as the baseline cost report, one of the key steps preceding the transition to Phase 6.4. As we found in our November 2014 report on NNSA cost estimating practices, having an independent entity conduct an independent cost estimate and compare it to a project team’s estimate provides an unbiased test of whether the project team’s cost estimate is reasonable.

Technology and manufacturing readiness assessments.

According to B61-12 program officials, the B61-12 program management team uses NNSA business practices to assess technology and manufacturing readiness levels for the LEP. The officials told us that all weapon components are maturing as planned with respect to their technology or manufacturing readiness. Officials also told us that they were conservatively applying NNSA business practices and noted that some components that have been in use for years may be assessed at lower readiness levels to account for other design changes in the B61-12. In addition, NNSA is in the process of planning for a technology readiness review later in 2015 by a group of Sandia National Laboratories experts that are not otherwise part of the B61-12 LEP. We have found in previous work that such independent peer reviews can identify important technology issues.

Peer review of the nuclear explosive package. Nuclear weapons designers at Lawrence Livermore National Laboratory, which is not otherwise involved in the LEP, provide peer review of the nuclear explosive package components being designed at Los Alamos National Laboratory—a practice in keeping with past LEPs. Since the United States ceased nuclear explosive testing in 1992, DOE and NNSA have relied on, among other things, national laboratory peer reviews to help ensure the continued safety, reliability, and effectiveness of U.S. nuclear weapons without explosive testing. According to the official in charge of the peer review, no significant issues with the nuclear explosive package have emerged in the peer review.

About 4 years after the B61-12 LEP began, NNSA incorporated elements of the B61-12 LEP management approach into a new policy for defense program management. Specifically, in August 2014, NNSA issued its Defense Programs Program Execution Guide (Program Execution Guide) regarding program management practices in NNSA defense programs, including LEPs. It applies to all ongoing and planned LEPs, including the B61-12 LEP. NNSA officials told us that the B61-12 LEP’s program management approach served as a model for many of the management practices and tools established in the Program Execution Guide. These practices include the use of earned value management systems, integrated master schedules, and risk management systems. NNSA officials told us that the name of the Program Execution Guide has created some confusion, and that it is not a DOE Guide—which provides nonmandatory means for meeting DOE requirements—but rather an NNSA policy letter. To allay the confusion, the officials told us, NNSA is in the process of renaming the document the Defense Programs Program Execution Instruction. As noted above, DOE does not have an order that provides requirements for the management of programs more generally; the Program Execution Guide applies only to those programs and projects managed by NNSA’s Office of Defense Programs.

The B61-12 LEP Faces Potential Management Challenges, but It Is Too Soon to Evaluate How They May Affect the Program

In undertaking its new management approach, NNSA has taken steps to address some of our prior recommendations, including drawing on our Cost Guide, but the B61-12 LEP still faces potential challenges regarding program management. The LEP’s new management approach, along with practices outlined in the Program Execution Guide, may help NNSA address these challenges, but it is too soon to evaluate how the challenges may affect the LEP.

Potential challenges NNSA and DOD have identified include the following:

Limited management capability and authority. According to an NNSA official, even with the increase in federal staff, NNSA needs two to three times more personnel in the federal program manager’s office to ensure sufficient federal management and oversight. As noted above, the NNSA federal program office employs about 20 people—8 federal FTEs and about 12 FTE-equivalent contractors—to manage NNSA activities. In contrast, the Air Force office employs about 80 federal FTEs and contractors to manage Air Force activities. In addition, the November 2014 report of the Congressional Advisory Panel on the Governance of the Nuclear Security Enterprise raised issues about the sufficiency of NNSA program managers’ authority. Specifically, the report states, “Although NNSA designates government program managers for each major program, their authorities have been very limited. Most importantly, they have lacked control over resources necessary to exercise needed leadership. In practice, they could more accurately be described as program coordinators than as program managers.” Similarly, in our March 2009 report, we found that NNSA’s program manager for the W76 LEP did not have sufficient authority over the construction or operation of a facility that was critical to the LEP, which played a role in resulting cost and schedule overruns.

Untested earned value management. NNSA and DOD officials we interviewed noted that NNSA’s earned value management system will be useful only insofar as good data are entered into the system and the system is used to inform program management. We have similarly noted in our Cost Guide that using earned value management represents a culture change and requires sustained management interest, as well as properly qualified and trained staff to validate and interpret earned value data. According to the officials we interviewed, the system is too new for them to determine conclusively whether the data are accurate and the earned value management system is being used effectively. The officials said that work to validate the data in the system is ongoing, with formal reviews to assess the quality of the system planned for 2016.

Cost estimating requirements and practices that have not followed best practices. In our November 2014 report, we found that NNSA defense programs generally, and the B61-12 LEP specifically, were not required to follow cost estimating best practices. For example, in that report, we found that the B61-12 LEP’s team- produced guidance for the program cost estimate did not stipulate that NNSA program managers or its contractors must follow any DOE or NNSA requirements or guidance to develop the B61-12 cost estimate. We recommended in the report that DOE revise its directives that apply to programs to require that DOE and NNSA and its contractors develop cost estimates in accordance with best practices. DOE agreed with this recommendation and, in June 2015, the Secretary of Energy issued a memorandum directing the heads of all department elements to use established methods and best practices, including practices identified in our Cost Guide, to develop, maintain, and document cost estimates for capital asset projects. We note that the memorandum pertains to departmental policy related to project management, not to program management. In the area of programs, NNSA officials described actions that it had begun taking to address our recommendation regarding cost estimating practices. We continue to monitor DOE’s response to our recommendation.

Guidance on technology readiness that has not followed best practices. An NNSA business practice requires technology readiness reviews for LEPs, but it does not specify technology readiness requirements for entering into first production—Phase 6.5 of the 6.X process. Best practices followed by other federal agencies suggest and our prior recommendations state that new technologies should reach TRL 7—the level at which a prototype is demonstrated in an operational environment, has been integrated with other key supporting subsystems, and is expected to have only minor design changes—at the start of construction. In our November 2010 report, we recommended that the Secretary of Energy evaluate where DOE’s guidance for gauging the maturity of new technologies is inconsistent with best practices and, as appropriate, revise the guidance to be consistent with federal agency best practices. DOE generally agreed with our recommendation. Concerning projects, in his June 2015 memorandum, the Secretary of Energy directed that critical technologies should reach TRL 7 before major system projects— those with a total cost of greater than $750 million—receive approval of their performance baselines. Concerning programs, NNSA officials told us they recently issued technology readiness assessment guidance that was not used in the B61-12 LEP but will be used in the W80-4 and Interoperable Warhead LEPs.

The new management approach that the B61-12 LEP’s program managers have implemented, along with the new Program Execution Guide, may help NNSA address the potential management challenges that NNSA officials and others have identified with previous LEPs, but it is too soon to determine whether this will be the case.

NNSA and the Air Force Have Risk Management Plans for the B61-12 LEP, but Managing Future Risks May Be Challenging Because the LEP Schedule Is Constrained

NNSA and the Air Force have instituted a process to identify risks within the B61-12 LEP and develop plans to manage those risks. However, a constrained development and production schedule—driven by the aging of legacy B61 bombs and the need to start work on other LEPs, among other factors—could complicate risk management efforts.

NNSA and the Air Force Have Instituted a Process to Identify and Manage Risks

According to NNSA and Air Force officials, the B61-12 LEP risk analysis and management approach uses the program’s integrated master schedules in conjunction with a risk register, the Active Risk Manager database. Specifically, the LEP’s 48 product realization teams (PRT)—the groups of scientists, engineers, and subject-matter experts that perform the ground-level project work on B61-12 components and subassemblies—are responsible for identifying risks. Most risks are managed at the PRT level, but risks that have the potential to affect top- level schedule milestones or the program’s ability to deliver a weapon that meets performance requirements are presented to joint review boards for inclusion in the Active Risk Manager database. These higher-level risks— referred to as joint risks—are categorized according to the likelihood of their occurrence and the consequences should they occur. Joint risks with the highest likelihood and consequence are color coded as “red” risks, with successively lower-likelihood and –consequence risks labeled as “yellow” and “green,” respectively. Program officials develop risk management steps for each joint risk, document and make time for these steps in both the Active Risk Manager database and the relevant integrated master schedules, and brief the Nuclear Weapons Council on the status of joint risks. Additionally, NNSA identifies and documents opportunities—program areas with the potential to realize saved time and cost.

According to NNSA and Air Force officials, some of the joint risks identified through this process have already been successfully managed. For example, NNSA officials told us that they were able to avoid the risk of a shortage of a type of glass necessary for electrical connections by procuring the glass for the entire program in advance. NNSA estimates that avoiding this risk prevented a program delay that could have lasted for more than a year and increased program costs by more than $2 million.

Other joint risks may affect later stages of the B61-12 LEP, so it is too soon to tell if plans to manage them will be effective. Joint risks in the “red” category (i.e., high risk) include risks related to the compatibility of the B61-12 with the still-developing F-35 aircraft, the risk of temperature- related component failures in certain flight environments, and schedule risks related to the hydrodynamic testing of certain changed nonnuclear components. In November 2015, the federal program manager for the LEP reported that these risks remain “red” but are “trending” in a positive direction. Based on our discussions with program officials and our review of NNSA and Air Force documentation, the steps necessary to manage these and other risks will occur over several years.

Agencies’ Management of Future Program Risks May Be Complicated by the LEP’s Constrained Schedule

Complicating efforts to manage future LEP risks—especially if risks are realized or new ones materialize—is a constrained development and production schedule. NNSA and DOD officials acknowledged the schedule’s constraints, which they say are driven by factors including delays in starting the B61-12 LEP because of a lengthy design study, the effects of sequestration, and the need to complete work on the B61-12 LEP to enable NNSA to start work on planned future LEPs. In testimony given to the Strategic Forces Subcommittee of the Senate Committee on Armed Services in March 2015, the Nuclear Weapons Council characterized the B61-12 LEP’s schedule as having “little, if any, margin left.” DOD officials have testified before Congress that the B61-12 LEP must be completed on the current schedule to ensure that the aging of B61 legacy bombs does not affect the United States’ ability to maintain its commitments to NATO, and DOE officials have testified that the LEP must be completed to ensure that DOE can effectively manage other ongoing and planned LEPs and stockpile stewardship activities. These activities are set to intensify in the coming years. For example, according to NNSA documents, NNSA plans to execute at least four LEPs per year simultaneously in fiscal years 2021 through 2025—along with several major construction projects, including efforts to modernize NNSA’s uranium and plutonium capabilities. Figure 3 shows the schedules for NNSA’s planned LEPs and major alterations.

Given NNSA’s past problems in executing LEPs, and a schedule with little room for delays, NNSA and Air Force may face challenges in the future in ensuring that risks are not realized and do not affect the program’s schedule, its cost, or the performance of the B61-12. We will continue to assess the B61-12 LEP as it passes through later stages of the Phase 6.X process, in keeping with the Senate report provision that gave rise to this report.

Agency Comments and Our Evaluation

We are not making new recommendations in this report. We provided a draft of this report to DOE and DOD for review and comment. In its written comments, reproduced in appendix II, DOE generally agreed with our findings. DOD did not provide formal comments. Both agencies provided technical comments that we incorporated, as appropriate.

We are sending copies of this report to the appropriate congressional committees, the Secretary of Energy, the Secretary of Defense, and other interested parties. In addition, the report is available at no charge on the GAO website at http://www.gao.gov.

If you or your staff members have any questions about this report, please contact me at (202) 512-3841 or trimbled@gao.gov. Contact points for our Offices of Congressional Relations and Public Affairs may be found on the last page of this report. GAO staff who made major contributions to this report are listed in appendix III.

Appendix I: Objectives, Scope, and Methodology

This report assesses (1) the Department of Energy’s (DOE) National Nuclear Security Administration’s (NNSA) management approach for the B61-12 Life Extension Program (LEP) and (2) the extent to which NNSA and the Air Force are managing risks in the LEP.

To assess NNSA’s management approach for the B61-12 LEP, we reviewed the program-developed documents that establish cost and schedule goals and track the program’s progress toward those goals. These documents included the program’s Joint Integrated Project Plan, Joint Top-level Schedule, Master Schedule, and Selected Acquisition Reports. In addition, we reviewed other program-developed guidance documents that the program management team prepared for the B61-12 LEP. These included the Integrated Phase Gate Implementation Plan, Project Controls System Description, Systems Engineering Plan, Quality Plan, and Configuration Management Plan. We also reviewed the Procedural Guideline for the Phase 6.X Process, which describes the roles and functions of DOE, the Department of Defense (DOD), and the Nuclear Weapons Council in nuclear weapon refurbishment activities such as the B61-12 LEP. In addition, we examined DOE and DOD directives and NNSA policy letters to understand departmental requirements for the management of the LEP. For DOE, these included DOE Order 251.1C, Departmental Directives Program; DOE Order 413.3B, Program and Project Management for the Acquisition of Capital Assets; DOE Guide 413.3-4A, Technology Readiness Assessment Guide; and NNSA’s Defense Programs Program Execution Guide. For DOD, these included DOD Instruction 5000.02, Operation of the Defense Acquisition System, and DOD Instruction 5030.55, DoD Procedures for Joint DoD-DOE Nuclear Weapons Life-Cycle Activities. For information on the management of the B61-12 LEP in the broader context of joint DOE-DOD stockpile stewardship activities, we also reviewed documents such as DOD’s Nuclear Posture Review Report of 2010 and DOE’s Stockpile Stewardship and Management Plan.

To assess the extent to which NNSA and the Air Force are managing risks in the LEP, we reviewed the documents described above. In addition, we visited NNSA’s Sandia National Laboratories and Los Alamos National Laboratory to view systems that track project activities, cost and schedule information, and the execution of risk management steps, as well as to meet program officials responsible for the design and production of the B61-12 and see some of the components under development. The systems we reviewed included the B61-12 LEP’s Active Risk Manager database and the systems holding classified elements of project plans and schedules.

For both objectives, in the course of our site visits to the laboratories named above, we interviewed federal officials and contractors involved with the B61-12 LEP. We also interviewed officials in NNSA offices responsible for providing guidance, oversight, and program review for the B61-12 LEP and other such defense programs. For criteria and context, we used the GAO Cost Estimating and Assessment Guide and our past reports on LEPs and NNSA cost estimating practices. Throughout our work, we coordinated with a team from DOE’s Office of Inspector General, which is conducting its own review of the B61-12 LEP and plans to issue a classified report.

We conducted this work from July 2014 to January 2016 in accordance with generally accepted government auditing standards. Those standards require that we plan and perform the audit to obtain sufficient, appropriate evidence to provide a reasonable basis for our findings and conclusions based on our audit objectives. We believe that the evidence obtained provides a reasonable basis for our findings and conclusions based on our audit objectives.

Appendix II: Comments from the Department of Energy

Appendix III: GAO Contact and Staff Acknowledgments

GAO Contact

Staff Acknowledgments

In addition to the individual named above, Jonathan Gill (Assistant Director), Antoinette C. Capaccio, Penney Harwell Caramia, Pamela Davidson, Dan Feehan, Alex Galuten, Jennifer Gould, Rob Grace, Alison O’Neill, Tim Persons, Ron Schwenn, Sara Sullivan, and Kiki Theodoropoulos made key contributions to this report.