Todd Jacobson
NS&D Monitor
5/30/2014
Language in the Fiscal Year 2015 National Defense Authorization Act passed by the Senate Armed Services Committee last week would require the National Nuclear Security Administration to come up with cost estimates for life extension programs and major construction projects when projects are in the concept definition phase of development. The provision, which would align NNSA practices with the requirements of the Weapons Systems Acquisition Reform Act, would accelerate the creation of cost estimates for major projects and give decisionmakers an earlier sense of how much projects will cost. In recent years, NNSA projects have been plagued by massive cost overruns, drawing considerable criticism from Congress. Such an approach is designed to avoid projects that get "too big to fail" after a significant amount of work is done.
Only select details of the bill have been released, and the full bill is not likely to be publicized until the Senate returns from recess next week. The project management approach favored by the Senate Armed Services Committee would force the NNSA to examine alternatives early in the process, and to take a harder look at what the realistic cost of a project might be. Currently, the NNSA is required to come up with a cost range during the design definition and cost study portion of the project management process.
A ‘Dose of Sticker Shock’ Needed
In the case of major projects like the Mixed Oxide Fuel Fabrication Facility, Uranium Processing Facility and Chemistry and Metallurgy Research Replacement-Nuclear Facility, those cost ranges proved to be significantly less than later estimates. "At the end of the day they need to bite into the lemon early on even though they don’t have the complete data they’d like," a Senate staffer told NS&D Monitor. "You get the Army Corps of Engineers looking at UPF before it gets going, it brings some realism to the show, to have a dose of sticker shock so it doesn’t happen four years later, at the end of CD-2 [Critical Decision-2]."
The provision would be applicable to projects more than $500 million, which would include the long-range standoff weapon warhead, any interoperable warheads that are developed, as well as separate refurbishments for the W88 or W78, if the NNSA chose to go that route. It would also include the new, scaled-back approaches to UPF and CMRR-NF, which are based on using existing facilities and building smaller, modular facilities. It does not apply to projects outside of NNSA. "To the layman, they’ve gotten in this scenario spending an awful lot of money and they find out the price tag is too high and it’s almost a too-big-to-fail mode," the staffer said. The staffer said it may cost a little more and take a little more time, but the goal is to "make them ponder and think. Get outside the group think, that’s the main thing. You need a skunk at the party I guess."
Bill Increases Nonproliferation Funding
Among the other details that were released late last week is information about increased authorized funding for the NNSA’s nonproliferation account. In addition to a $145 million increase for the Mixed Oxide Fuel Fabrication Facility, the committee added $140 million in authorized funding for nonproliferation work, including an extra $40 million for the Global Threat Reduction Initiative, $30 million for the Nonproliferation Research and Development, and $70 million for International Materials Protection & Cooperation, primarily for the Second Line of Defense program.
Other provisions in the bill include:
— Language requiring U.S. Strategic Command and the Pentagon to provide Congress with information about changes to the number of B61 nuclear bombs that will be refurbished by the NNSA, an apparent response to the news that the number of refurbished W76 warheads was cut back in a surprise to Congress;
— A requirement to provide a report on the status of the air-launched cruise missile and its replacement, the long-range standoff weapon;
— Language requiring the Congressional Budget Office to update its report on what it costs to modernize the nation’s nuclear deterrent every two years; and
— A provision requiring the NNSA administrator to respond to the findings of the nuclear security enterprise governance panel within 90 days of the completion of the panel’s work.
