Under the LLRW Policy Act of 1980, as amended, the federal government is responsible for the disposal of LLRW owned or generated by DOE. DOE defines LLRW as all radioactive waste that does not fall within other classifications, such as spent (used) nuclear fuel and other high-level waste. Mixed waste is LLRW with hazardous components, such as lead and mercury. LLRW can include material of varying levels of radioactivity, from barely contaminated soil and debris to LLRW with enough radioactivity to require remote handling. LLRW can include items such as contaminated equipment, protective clothing, rags, and packing materials and is managed at multiple sites under a variety of contractors. (See app. I for a list of DOE sites that disposed of the majority of LLRW in fiscal years 2004 and 2005.) DOE sites typically dispose of LLRW at (1) on-site facilities, if suitable capacity is available, (2) DOE’s regional disposal facilities at the Hanford Site or the Nevada Test Site, or (3) a commercial facility. The selection of the disposal facility is based partly on the facility’s waste acceptance criteria. These criteria specify the allowable types and amounts of radioactive materials, and types of containers acceptable at the disposal facility. In 2000, we reported that DOE had not developed full life-cycle costs for its disposal facilities or established guidance to ensure that its contractors base their disposal decisions on departmentwide considerations of cost- effectiveness, among other things. We also reported in 2001 that cost analyses concerning the use of DOE’s on-site disposal facilities should be periodically updated to take into account changing economic conditions. Subsequently, the House Committee on Appropriations directed DOE to prepare an objective analysis of the life-cycle costs of LLRW disposal for various federal and commercial disposal options. The committee was concerned that DOE needed to include in its life-cycle cost analysis certain cost elements, such as packaging, transportation, disposal, and postclosure maintenance and surveillance. In response, in its 2002 report to Congress on life-cycle cost analysis of LLRW disposal, DOE listed among its next steps for EM sites to consider the cradle-to-grave costs as they make LLRW management decisions. On July 18, 2002, EM issued guidance directing each site office to develop the mechanisms necessary to ensure that contractors’ LLRW disposal decisions include the best estimate of full cradle-to-grave costs and analysis of alternatives. Several other documents on life-cycle cost analyses are also available. For example, DOE has a cost-estimating guide, developed in the mid-1990s, that provides a chapter dedicated to life-cycle cost analysis, including definitions, processes, limitations, common errors made in life-cycle cost analysis, methods, examples, and diagrams. In addition, although not directly applicable to LLRW management, guidance and manuals prepared by other federal agencies for other DOE programs may be useful to the sites in explaining life-cycle cost analysis methods. For example, the National Institute of Standards and Technology has published two documents on life-cycle cost analysis that are applicable to DOE’s Federal Energy Management Program. DOE sites prepare various types of cost analyses in making LLRW management decisions, but these analyses do not consistently use complete, current, or well-documented life-cycle cost analysis to ensure that the lowest-cost LLRW management alternatives are identified. As a result, the decisions the sites make may not take into account the most cost-effective alternative. These inconsistencies have occurred, in large part, because DOE’s guidance lacks necessary detail and its oversight of contractor practices is weak. Complete life-cycle cost analysis is cradle to grave and includes all costs associated with the management and disposal of LLRW. As DOE’s 2002 report to Congress explained, the costs preceding disposal vary greatly and can be significantly greater than the actual cost of disposal. As a result, DOE concluded it is essential to consider pre-disposal costs as well as disposal costs. Table 1 shows the cost elements of a complete life-cycle cost analysis, according to DOE’s 2002 report. DOE LLRW generator sites we visited did not always include all life-cycle costs—including the postclosure costs of long-term maintenance and surveillance of the disposal site—and did not always consider alternative actions when deciding on how to manage and dispose of LLRW. For example, despite DOE’s guidance to include all disposal costs in its life- cycle cost analyses, DOE contractors at two sites—Rocky Flats, Colorado, and Paducah, Kentucky—did not consistently consider postclosure costs in the analyses supporting their LLRW disposal decisions for fiscal year 2004. In contrast, the contractor at Fernald, Ohio, prepared a life-cycle cost analysis that included estimated postclosure costs for both the Nevada Test Site and for Envirocare of Utah, a commercial disposal facility. Nevada Test Site officials told us they do not include these future costs in their disposal fees because they operate on an annual appropriated funds basis. Nevada Test Site officials estimated that if they were to include postclosure costs in their fee, these costs would add an additional $2.38 per cubic foot of waste to the fee. Envirocare of Utah, on the other hand, includes the estimated postclosure costs in its disposal fees, as required by the state of Utah. Costs for certain LLRW activities vary widely among disposal sites and should be considered in preparing life-cycle cost analysis. For example, EM’s 2002 report to Congress found that costs for one predisposal cost element—waste characterization—can be higher for wastes shipped to the Nevada Test Site and the Hanford Site for disposal than for wastes sent to Envirocare of Utah. Waste characterization costs for the two DOE sites ranged from $130 to $2,400 per cubic meter, while these same costs ranged from $30 to $880 per cubic meter at Envirocare of Utah. The major factors contributing to this cost differential are (1) required procedures for accepting, handling, and disposing of LLRW with higher levels of radioactivity at the Nevada Test Site and Hanford and (2) the higher cost to the generator of characterizing wastes that are shipped in containers to the Nevada Test Site and Hanford Site for disposal. Although waste characterization is an important element in life-cycle cost analysis, the Rocky Flats contractor did not include the costs of these activities in its cost analysis. In addition, waste generators do not always include potential lower-cost alternatives when making LLRW decisions. For example, in fiscal year 2004, the Paducah contractor shipped 600 cubic meters of LLRW in trucks to Envirocare of Utah. Although in its preliminary analysis, the site contractor believed that using rail could save 25 percent in transportation costs, contractor officials indicated they did not validate these preliminary assumptions or complete a formal cost analysis of the rail option. DOE contractors’ cost analyses are not always current. Despite DOE’s 2002 recommendation that cost estimates should be revisited periodically, one DOE waste generator disposed of large volumes of LLRW in fiscal year 2004 on the basis of cost studies completed several years earlier. Specifically, the contractor at Fernald acknowledged shipping over 100,000 cubic meters of LLRW to Envirocare of Utah in fiscal year 2004, using a cost analysis completed in 1994. This analysis, while considering all life- cycle cost elements, had not been updated during this 10-year period to account for any changes that might have occurred in cost elements, such as changes in disposal rates, costs for packaging, treatment, or transportation. For example, disposal rates charged by Envirocare of Utah can change from year to year, based on price discounts offered for larger LLRW disposal volumes. We also found that three of the five DOE sites that had expanded on-site facilities since 2002 did not complete an analysis comparing the life-cycle costs of on-site and off-site disposal alternatives. A 2001 congressional conference report requires DOE to perform such an analysis “before proceeding with any new on-site disposal cell.” DOE asserts that the report language does not apply to ongoing facility development or expansion. Officials at two sites indicated they did not believe they needed to complete such a life-cycle cost analysis because the expansion of their on-site disposal facility was already accounted for in the initial facility design, completed before 2002. The third site completed a life-cycle cost analysis of LLRW waste streams for its on-site facility. However, site officials did not complete a life-cycle cost analysis of off-site disposal because they assumed that the costs of off-site transportation and disposal would be significant enough to preclude the off-site option. Although the remaining two sites completed life-cycle cost studies comparing on-site and off-site disposal costs, these studies were not submitted to the congressional appropriations committees. DOE contractors’ cost analyses are not always well documented. In some cases, we could not determine how contractors incorporated cost analyses into their disposal decisions because documentation was incomplete. According to DOE and contractor site officials at Rocky Flats, disposal decisions were at times based on noncost factors, such as schedule or safety. For example, a 2003 cost study determined that using trucks to transport building debris to a nearby rail loading area less than 1 mile away would be more cost-effective than extending a rail line to the building. However, contractor officials told us they decided to build a rail extension to the building being demolished because the extra traffic at the site caused by trucks hauling the LLRW to the rail line could endanger the health and safety of the workers. This decision, however, was not documented.