March 17, 2014

DOE IG: DRIVERS OF BOTCHED LANL SECURITY UPGRADE ‘ANALOGOUS’ TO Y-12 BREACH

By ExchangeMonitor

Los Alamos National Laboratory’s Contractor Assurance System (CAS) did not adequately alert lab or National Nuclear Security Administration management to problems on a botched nuclear security upgrade project at the lab’s Technical Area 55, according to a report released yesterday by the Department of Energy’s Inspector General that suggested the CAS problems at Los Alamos were “analogous” to CAS issues that contributed to the 2012 security breach at the Y-12 National Security Complex. The IG report released yesterday includes a scathing critique of the management problems that plagued phase two of the Nuclear Materials Safeguards and Security Upgrades Project (NMSSUP), highlighting a host of management problems that led to a $41 million increase in the cost of the project and more than a year delay in its completion. The problems with the lab’s Contractor Assurance System were particularly notable considering that similar issues led to the security breach at Y-12 just months before the NMSSUP project was put on hold.

According to the IG report, target metrics derived by Los Alamos for cost, schedule, risk and quality did not provide “proactive indicators of risk” in those areas. In fact, the IG report said that CAS data leading up to the realization that the project was in jeopardy of breaching its funding generally indicated that the project was on track, incorrectly suggesting that the lab had enough contingency funds to complete the project and that it would meet its cost and schedule performance indicators. “In contrast, NNSA and Departmental officials who provided monthly project status commentary assessed project performance as red, indicating concern that NMSSUP was not being completed as planned,” the IG said, noting that LANL revised its CAS reporting data in January 2013.

Despite many changes and corrective actions on the project, a peer review and Earned Value Management System review last year continued to reveal data quality concerns, the IG said. “Both reviews determined that the LANL schedule was unrealistic and/or unexecutable, and that officials continued to forecast optimistic future schedule performance despite repeated and significant delays,” the IG said. In September, continuing problems forced the lab to push back the completion date of the project from December 2013 to February 2014. “Continued, sustained effort is necessary to address the project management weaknesses that exist within NNSA,” the IG said.

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