Alissa Tabirian
NS&D Monitor
8/7/2015
The National Nuclear Security Administration’s (NNSA) 2015 long-term budget estimate for its nuclear arms modernization programs has increased by $17.6 billion since last year, according to a Government Accountability Office (GAO) report released yesterday. The report says NNSA’s 2015 estimate of $293.4 billion over 25 years represents “an increase of $17.6 billion (6.4 percent) from the $275.8 billion in estimates provided in 2014.”
The audit, which comes on the heels of a GAO report last week highlighting discrepancies in NNSA’s budget reporting, found that for life extension programs, a subset of the modernization program, the budget estimate decreased by 31 percent due to “delayed production schedules and changes in estimating methodologies.” The report notes that “NNSA’s near-term budget estimates to refurbish its B61 bomb and W88 warhead align with its plans,” but the estimate for the cruise missile life extension program requires an additional $150 million to reflect the “$850 million midpoint” of the cost range.
NNSA’s 2015 estimates also include a 71 percent increase in “infrastructure budget estimates for construction projects,” a 10 percent increase from last year in the science, technology, and engineering budget over 25 years, a 20 percent increase in weapons activities including “nuclear weapon security and transportation,” and a 37 percent increase in stockpile services. The budgetary changes are largely attributed to “changes in program scope and budgetary structure” and more complete estimates from the agency this year, the report says.
NNSA also “has not established a firm cost, schedule, and scope baseline for either the Chemistry and Metallurgy Research Replacement-Nuclear Facility (or its alternative) [at Los Alamos National Laboratory in New Mexico] or the Uranium Processing Facility [at the Y-12 National Security Complex in Tennessee],” the audit says, which prevents the GAO from assessing the budget estimates of these “multibillion dollar construction projects.”
The audit found that NNSA’s $3.6 billion deferred maintenance backlog for its nuclear facilities is likely to grow. While the agency’s yearly maintenance budget is expected to be “at least 2 percent of a site’s replacement plant value in order to keep facilities in good working order,” the 2015 budget materials fall short by an average $224 million annually, based on DOE guidelines. Delaying maintenance of aging facilities “can reduce the overall life of federal facilities, lead to higher costs in the long term, and pose risks to safety and agencies’ missions,” the report says.
The GAO recommended the NNSA “identify the amount of the shortfall in its budget materials” and its impact on program costs, schedules, and objectives. The audit also recommended “improving the transparency of future budget materials by identifying potential risks to the achievement of program goals if budget estimates are lower than plans suggest are necessary.” For example, NNSA identified 40 percent of the deferred maintenance backlog, worth $1.4 billion, as “not mission dependent” and therefore “unlikely to be addressed.” This, the report says, is “not useful for budget estimating.”
NNSA agreed with the recommendations and said it will include “statements in future Stockpile Stewardship and Management Plans on the effect of funding [a life extension program] effort at less than suggested by a planning estimate cost range.” In its response to GAO, NNSA also said the agency “is developing methods and approaches to enhance cost estimating capabilities to inform planning and budgeting estimates.”
