POGO Letter to Energy Secretary Abraham recommending immediate competition of management contract of Los Alamos

The Honorable Spencer Abraham

Secretary

U.S. Department of Energy

1000 Independence Avenue, SW

Washington, DC 20585

Via facsimile: (202) 586-4403

Dear Secretary Abraham,

Senator Pete Domenici recommends that the Los Alamos National Laboratory (LANL) contract should be allowed to run to term ending 2005, and then be competed. However, we understand from sources that you feel that the University of California (UC) management failures uncovered so far are so serious that change is needed now to protect the nation's interests. We agree.

First, in 2005, it is likely the Congress and the press will have moved on to new interests, and you may well not be Energy Secretary to ensure the implementation of your plan. We remember former-Secretary Richardson's order to de-inventory LANL's TA-18 Site because it could not be protected, and move the Special Nuclear Material to the Nevada Test Site Device Assembly Facility by 2003. The Department of Energy (DOE) bureaucracy simply out-waited him, and now the Department is talking about moving the materials beginning in 2007.

In addition, Senator Domenici believes that making such a decision will end the revelations of irresponsible management by UC at LANL. We assure you that the revelations are not over. In fact, scandals that have already been publicized are far more serious than reported.

For example, earlier this month LANL was hit with another new series of safety violations. DOE issued a tepid press release late on Good Friday that downplayed the seriousness of these violations. In fact, the publicly released version of the April 10, 2003 letter from National Nuclear Security Administrator Linton Brooks to Los Alamos Director Vice Admiral Nanos redacted the mention that it was plutonium that contaminated seven workers. Airborne plutonium is one of the most carcinogenic substances known, even in very small amounts. What the unredacted letter describes is that in 2002, workers at the TA-55 plutonium facility cut a copper pipe while not following safety procedures, sending plutonium airborne and exposing seven lab workers to "significant plutonium contamination" with the most dangerous plutonium isotope - PU-238. The Brooks letter minimizes the event, stating "...the actual uptakes of radioactive material for the workers were minimal..." Microscopic particles, especially of PU-238 are particularly lethal and should not have been minimized. I have attached the two versions of the same letter for your review. (Click here for the letter, Click here for the redacted letter)

This has happened before at TA-55. In 2001, a hose to a glove box came loose, and seriously contaminated several lab employees with major doses of plutonium. General Gordon, then head of NNSA, described that incident as "one of the ten worst contaminations" in the 60-year history of the nuclear weapons program. In a March 20, 2003 report, the DOE Inspector General (IG) found that UC Lab Management falsified the Occurrence Report relating to this incident by failing to inform the DOE about the contamination of the workers. After each of these safety debacles, UC assured DOE that they have made improvements and that these incidents won't happen again. However, history keeps repeating itself.

The "fine" for the recent violations was $385,000, which as you know, is forgiven because UC is a non-profit. However, knowledgeable sources tell POGO that DOE was initially going to "fine" UC $1.5 million given the seriousness of the violations and the fact that they have occurred before. UC successfully lobbied DOE to dramatically reduce the fine to avoid further embarrassment for the lab.

The recent situation of the unauthorized nuclear facility created at PF-185 containing large amounts of plutonium with no required safety analysis, is further indication that UC/LANL is not serious about compliance with nuclear safety standards. This comes at a high cost to the health and safety of the workers, as well as the taxpayers.

UC has also not distinguished itself in the management of major programs. The National Ignition Facility ( NIF) at Livermore has been a cost, schedule and technical nightmare for years, and UC seriously mislead then-Secretary Richardson claiming that the program was on schedule and below budget when neither was true. Los Alamos' Dual Axis Radiographic Hydrodynamic Test facility, (DARHT), has also had cost, schedule and technical problems. And just last week, UC put out a good news press release that after seven years, Los Alamos has finally produced their first untested pit (the plutonium trigger for the W-88 warhead). This after spending over $1 billion, and Los Alamos will not be able to produce a single certified or deployable pit until 2007. This is hardly impressive, given that by 2001 Los Alamos was expected to be producing 10 pits each year. Each of these programs are critical for stockpile stewardship and the readiness and safety of our nuclear weapons.

In addition, the full extent of the financial scandal at LANL has not fully played out. Peter Bussolini and Scott Alexander still have not been prosecuted. There remain significant unanswered questions: What were they up to? Who knew what, when at the lab? What was the full extent of the cover-up and obstruction of justice, which are still under investigation by the FBI and US Attorney?

In addition to the already revealed financial scandal, the Inspector General just issued a report finding that the University of California had charged $14.6 million of unallowable costs to the taxpayers for meals, lodging and travel, in violation of federal regulations. The most shocking finding of the report is that the University of California is much more careful with its own funds than they are with taxpayer funds. "We noted that meals paid for with University funds must be approved two supervisory grade levels higher than those paid for with government funds... We could not reconcile this inconsistency," wrote the Inspector General.[1] A pure double standard. The IG sensibly recommended that the DOE recover this money. One would think DOE would be outraged at this double standard. Instead, DOE's comments in the back of the report praise UC, stating "it is important to note in the report the progress that has been achieved by the University of California."

Where are the over 260 stolen or missing computers identified by former Office of Security inquiries Director Glenn Walp before he was fired for doing his job? What national security information was stored on them? LANL claims there was no classified or sensitive information on these computers. However, there is no way they can make such a statement. As the DOE Inspector General wrote in a report released just yesterday, "Because of the weaknesses identified, specifically those relating to computers used for processing classified data, we do not believe that Los Alamos can provide adequate assurance that classified, sensitive, or proprietary information is appropriately protected."[2] During this investigation, the IG found Los Alamos could not account for its classified laptop computers, and "unlocated" laptops were written-off without formal inquiry. Even the guard force was missing four laptops. Incredibly, employees were not even held financially responsible for the loss of these computers. In yet another example of LANL's arrogant foot-dragging, the cyber-security upgrades mandated after the Wen Ho Lee debacle to prevent such security breaches in the future have not yet been implemented. This is the same Lab that also brought us the disappearing highly-classified hard drives, only to reappear behind a copy machine. About six months ago, yet another classified hard drive was missing and never found.

Red herrings have circulated that scientists and other workers at LANL would lose their jobs if the management changed hands. This is a cynical attempt to stir up fear among those who bear no responsibility for UC's management failures at the Lab. As you know, the management contracts at other sites in the DOE weapons complex have changed hands, for example, at the Pantex Plant, Sandia National Laboratory, Oak Ridge Y-12 Facility, and the Hanford Site, with only the senior management positions turning over.

We strongly encourage you to compete the contract for management of Los Alamos immediately, rather than waiting until the end of the existing contract. Historically, the Department of Energy has made excuses for UC's mammoth failures. It is time to hold the managers of our national labs accountable. If the University of California is the best competitor for the job, it will win the contract again. After 60 years, and an accelerating rate of publicly embarrassing and irresponsible behavior, it is high time to reevaluate whether the University of California is the best entity with which to entrust billions of tax dollars as well as our nation's national security.

Sincerely,

Danielle Brian

Executive Director

1. "University of California's Costs Claimed and Related Internal Controls for Operation of Los Alamos National Laboratory." DOE/IG-0596. April 2003. p 3.

2. "Inspection of Internal Controls Over Personal Computers at Los Alamos National Laboratory." DOE/IG-0597. April 2003. Letter of Transmittal.