The Project On Government Oversight has launched its updated Federal Contractor Misconduct Database (FCMD), which catalogues penalties, warnings, and other oversight actions between the government and its contractors. This data offers unprecedented insights into the history of waste, fraud, and abuse by federal contractors, including those that manage and operate the U.S. nuclear weapons complex.
This complex encompasses the military research, testing, and production facilities that sustain America’s nuclear arsenal. It is managed by the National Nuclear Security Administration (NNSA), a semi-autonomous agency within the Department of Energy (DOE). NNSA’s mission is expansive, expensive, and scientifically demanding.
POGO’s FCMD is a compilation of misconduct and alleged misconduct committed by the top federal government contractors from 1995 to the present. We don’t claim to have identified every instance of actual or alleged misconduct involving the contractors in the FCMD. The total number of misconduct instances and penalty amounts might be understated due to the fact that the terms of settlements are often undisclosed. Such instances generally feature an “unknown” or “undisclosed” designation or a zero ($0) monetary penalty.
Nonetheless, the FCMD complements conventional oversight tools. Reports produced by Inspectors General or the Government Accountability Office typically focus on a specific issue, such as poor procurement controls or a lack of strategic planning for new construction. NNSA’s internal performance evaluations are notoriously uncritical and focus mostly on the national security aspects of lab operations. With the FCMD, it’s possible to evaluate weapons activities, personnel, and environmental practices at the same time, and have a more complete picture of key contractors’ performance.
As the FCMD helps show, the contractors responsible for the nuclear mission have made frequent, and at times dangerous, mistakes. Since 1995, NNSA contractors have been cited 53 times for problems ranging from employee discrimination to explosions of radioactive waste, and they have lost over $190 million through fines, settlements, and docked award fees. The most frequent offenders are Los Alamos National Lab (LANL), Lawrence Livermore National Lab (LLNL), and the Savanah River Site (SRS).
The FCMD is unambiguous in the contrast between NNSA performance and the rest of DOE. There are 17 labs in the national laboratory system; the 3 managed by NNSA—Lawrence Livermore National Lab, Sandia National Lab, and Los Alamos—have accounted for over 50 percent of the total financial penalties levied against the entire system over the last 20 years. Most of the non-NNSA penalties—about 90 percent—come from a single contract dispute at a single DOE lab.
The largest single penalty against the weapons labs came in 2015 when DOE cut Los Alamos’ award fee by 90 percent—$57 million—for a radiological incident at the Waste Isolation Pilot Plant (WIPP). In February 2014, staff at the lab incorrectly packed nuclear waste for storage, leading to an explosion, fire, and radiation leak. The plant has not reopened. The second largest fine was a 2007 age-bias lawsuit against LLNL, worth about $37.25 million.
The fines would be even more skewed if NNSA had the backbone to punish its contractors by more frequently withholding award fees for misconduct. In theory, contractors receive these fees—typically tens of millions of dollars—in return for good performance; in practice, unsatisfactory performance typically goes unpunished. For example, Lockheed Martin, which owns and operates Sandia, has illegally lobbied the government using taxpayer dollars on multiple occasions, but its fees have never been docked, despite clear and egregious misconduct. As the Inspector General wrote after the last incident, “Given the specific prohibitions against such activity, we could not comprehend the logic of using Federal funds for the development of a plan to influence members of Congress and federal officials to, in essence, prevent competition.”
Another way of illustrating the problems with nuclear weapons contractors is by expanding the definition of the nuclear weapons complex to include current and former weapons sites. While NNSA is in charge of current nuclear weapons work, cleaning up the Cold War plants that manufactured weapons material—namely the Hanford Site, the Rocky Flats Plant, and the Fernald Production Center—falls entirely to another department within DOE. However, many of the contractors are the same, and by taking that into account, we get a much clearer picture of systemic waste, fraud, and abuse.
For example, over 20 percent of our misconduct entries for DOE name Bechtel or conglomerates where Bechtel is a partner as the offending contractor. Bechtel is currently part of management at LANL, LLNL, Y-12, and Pantex, and has, over time, done work at most of the labs and cleanup sites. Most notably, it is the primary contractor at the Hanford Site in Washington State where the U.S. manufactured plutonium for nuclear weapons during the Cold War. The plant is gone, but much of its radioactive waste remains.
Hanford is the most frequently cited DOE location in our database, and the most contaminated nuclear cleanup site in the world. DOE has spent $19 billion over 25 years there without treating any nuclear waste. In 2012, engineering problems brought a halt to construction of the main treatment plant. Despite clear management failures and whistleblower reprisals, DOE stuck with contractors Bechtel and URS. The Department then authorized an additional treatment plant as a workaround, but a recently leaked report has shown that plant isn’t expected to work either, due to “fundamental weaknesses and breakdowns” in management.
The Hanford Site is also a useful model for the FCMD as an oversight tool. The cleanup is a complex problem, made more complicated by government, as well as contractor, mismanagement. This database makes it possible to parse oversight problems, at the Hanford site or elsewhere, into their constituent parts. In this way, the FCMD helps identify contractors that are part of the problem, and allows policymakers, watchdogs, and citizens to better explore solutions.
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