Todd Jacobson
NS&D Monitor
1/10/2014
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 this week 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 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 on the project, which was designed to link new buildings, fences, barriers, sensors, cameras, lighting and software around the lab’s plutonium facility. 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.
IG Details Inconsistent Feedback on Project
At the same time that Los Alamos’ CAS was reporting “satisfactory project performance,” NNSA and DOE assessments indicated the project was in jeopardy. “We found that this inconsistency was directly tied to LANL’s choice of using performance targets that were easily achievable and/or did not predict or satisfactorily address emerging problems,” the IG said. “NNSA officials told us they were aware of the inconsistencies in the project performance reports; however, data inaccuracies prevented them from knowing the extent of the problems.” A revised acquisition strategy and favorable bids also led lab officials to reduce the project’s funding baseline from $245 million to $213 million in 2011, a move that would come back to haunt the project.
The IG report detailed for the first time a host of problems encountered on the project, including plans for a retaining wall that had to be changed because designers didn’t realize the wall would have blocked a buried radioactive waste line. Workers also had to rebuild a road after it was determined employees would have had to walk through traffic to reach the entry of a security badge reader, and ductwork that was to carry fiber optic cables connecting was installed incorrectly.
Funding Dries Up in Late 2012
The problems came to a head in the fall of 2012 when the project was slated to be finished. The problems with the system prevented it from working correctly, but the lab lacked funding to complete the work, and it stopped work on the project for three months. In December of 2012, it said it needed an additional $41 million to complete the project, and in an agreement with the NNSA to restart the project, the lab agreed to foot $10 million of the bill and brought in new leadership for the project, including Ty Troutman, the construction functional manager for Bechtel Systems and Infrastructure.
The lab said construction was completed on the project Nov. 15 and activation and testing of the system will continue until February when the project is expected to be closed out. The first portion of the Entry Control Facility is in use, and the estimate-at-complete is $239.7 million, $4.5 million less than the project’s $244.2 million budget.
Lab: Improvements Made
The NNSA and lab agreed with the IG’s findings, and in a statement, Los Alamos spokesman Fred deSousa said broad changes have been implemented at the lab. “We’ve acknowledged that there were deficiencies and we’re committed to correcting them, not only in the specific ways mentioned in the Inspector General’s report but in a broader sense on project management lab-wide,” deSousa said. “In fiscal year 2013 we achieved official project completion (CD-4) on five projects, each on or ahead of schedule and under the agreed costs. That’s what the government expects and that is our goal on each project.”
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.
