The National Nuclear Security Administration (NNSA) is taking its contractors to task, but is it enough?
The NNSA, a semi-autonomous branch of the Energy Department that manages the U.S. nuclear weapons complex, finally released its 2015 contractor evaluation reports this month, and some of the reviews are less than glowing.
Of particular note is the Performance Evaluation Report for the managing contractor for the Pantex Site and the Y-12 National Security Complex, Consolidated Nuclear Security (CNS). The NNSA found CNS’ self-assessment lacking.
One of the most shocking revelations in the document, detailed in an Amarillo Globe-News article, was a mix up involving the B61-12 “smart bomb.” The NNSA found quality issues on several production units provided by CNS, “the most severe of which was the installation of an incorrect tail case.” The assembled bomb (which was just a full scale mock up and not nuclear armed) was sent to the Department of Defense for testing with the wrong tail. After the Department discovered the error, it “chose not to proceed with the flight test and returned the unit to Pantex.”
This is a major misstep for CNS. The B61-12, an upgrade of the B61-4 bomb, is the biggest modernization project the NNSA is working on right now. It’s also one of the most expensive. A 2012 Pentagon study found that the B61 Life Extension Program would cost $10 billion, plus an additional $1 billion for a brand new tail kit, to make it a precision-guided standoff weapon.
For this and other mistakes, the NNSA docked CNS’s rating in several areas (bringing them from a “Very Good” to a “Good” or “Satisfactory”) and decided to award them only 57 percent of the possible award fee. Astoundingly, that means the company still received an $11 million award fee (essentially a performance bonus) on top of their fixed fee of $31 million.
CNS is the joint venture of several big name defense contractors, including Bechtel National, Inc. and Lockheed Martin. When CNS was awarded the contract in 2013, they claimed they could save taxpayers over $3 billion by cutting redundancies and consolidating management. While this sounds good in theory, the NNSA never did the work to validate the claim and now they’re paying for it.
A Government Accountability report from last year found that the NNSA evaluation of the CNS bid “did not clearly or completely describe expected benefits and costs.” Nor was the agency able to describe the “expected benefits, how they will be achieved, or the associated uncertainties.”
The NNSA’s contractors are in charge of sites that play a vital role in U.S. national security. When they screw up, it’s the agency’s duty to hold them accountable. However, a “Satisfactory” rating and $11 million in award fees doesn’t sound like very good accountability.