As the trillion dollar “modernization” of U.S. nuclear forces moves forward, note how hollow the Department of Energy infrastructure is because of contractor greed, incompetence and waste. While that alone won’t win the day for us, I do expect it to limit the scale and timing of “modernizing” the DOE nuclear weapons complex (“modernization” means the indefinite preservation of the nuclear weapons stockpile and its supporting research and production infrastructure, contrary to official U.S. policy that endorses a future world free of nuclear weapons). This includes Life Extension Programs that give existing nuclear weapons new military capabilities despite denials at the highest levels of the U.S. government, and new production facilities such as the Uranium Processing Facility at the Y-12 Plant near Oak Ridge, TN and plutonium facilities at Los Alamos which face constant cost overruns.
There could also possibly be developments in the first quarter of next year related to its illegal lobbying activities that would shake up Lockheed Martin’s grip on the Sandia Labs (the Sandia contract is also scheduled to be put up for bid). In short, 2016 could be a very fluid and unstable year for the DOE nuclear weapons complex, even as it seeks to put the B61-12 smart nuclear bomb into production and move forward aggressively on a nuclear warhead for a new first-strike air-launched cruise missile.
Jay Coghlan, Executive Director
LANL contract up for bid after 2017
By Mark Oswald / Albuquerque Journal Staff Writer
Friday, December 18th, 2015 at 11:40pm
SANTA FE – The National Nuclear Safety Administration has informed
Congress that the Los Alamos National Laboratory contract will be put
out for competitive bidding sometime after 2017, the Journal has learned.
It would be only the second time the contact has been put out to bid
since the lab was created to develop the atomic bomb during World War II.
LANL’s most recent federal government performance evaluation is better
than last year’s, but not good enough for the lab’s private-sector
operator to earn the award of an extra year on its contract, the lab’s
director informed LANL workers this week.
And continuation of Los Alamos National Security LLC holding the
contract was contingent on it being granted the “award term.”
LANL director Charles McMillan said in his Thursday email to lab
employees that he was “deeply disappointed that we did not meet NNSA’s
expectations in a manner sufficient to net another year of award term”
on the contract that runs through fiscal year 2017.
“Nevertheless, the federal government has offered Los Alamos National
Security, LLC (LANS) an extension to the contract to manage the
Laboratory beyond FY17; I will provide additional details about that at
a later date after there has been more discussion between the federal
government and LANS,” McMillan said in a copy of his message obtained by
An extension as described by McMillan is not the same thing as the
merit-based award of an additional contract year that LANS missed out on
this year. It’s unclear from McMillan’s statement whether the extension
he mentioned is intended as merely a holding pattern but, under its
contract, LANS needed to earn an award year this time around to keep the
The contract with LANS provides for vacating the contract, awarded in
2006, if the consortium doesn’t earn a series of one-year term awards.
Last year, the Department of Energy – NNSA’s parent organization –
warned that LANS was under the gun to earn an award term for its work in
“Having failed to earn contract term extensions for fiscal years 2013
and 2014,” and with the revocation of a previous extension, “LANS must
earn (an) award term in every future performance period to keep the
contract in force beyond fiscal year 2017,” said a statement provided by
the DOE last December.
On Friday, an NNSA spokeswoman said, “We do not comment on ongoing
Contract over $2 billion
LANS – a consortium that includes the Bechtel corporation, the
University of California, Babcock and Wilcox, and URS Energy and
Construction – won the LANL contract in 2006. The contract now amounts
to about $2.2 billion a year, plus a fee based on performance.
The University of California, on its own, had previously held the Los
Alamos contract since the lab’s beginnings developing the atomic bomb
during World War II. The contract was put out for competition about a
decade ago after a series of security and property management problems
at the lab.
Last year, LANS also didn’t earn an “award term” and even lost a year it
had previously been granted as NNSA hit the lab hard for failures that
led to a radioactive leak at the nation’s nuclear waste repository near
Carlsbad from a drum packaged at Los Alamos. The Waste Isolation Pilot
Plant has been shut down since the leak in February 2014.
The federal government cut the performance-based management fee for LANS
by nearly 90 percent, down to $6.25 million, for fiscal 2014. That
compared with $59 million-plus paid to the LANS consortium the previous
two years. No information on the 2015 fee award has been released.
McMillan’s Thursday message to employees said that, in order to earn an
award year, the lab had to score better than “satisfactory”in all of
six evaluation categories. “We did not accomplish this,” McMillan said,
despite getting high scores in four of the six areas.
NNSA rated LANS only satisfactory for operations and infrastructure, the
same category in which the lab got a crucial “unsatisfactory” grade last
year. LANS this year was rated “very good” in two categories – its
missions to manage nuclear weapons and reduce global nuclear security
threats – and excellent in two others, missions for science technology
and engineering, and for a “DOE and Strategic Partnership Project.” The
NNSA rated LANS’s leadership as “good.”
Despite his disappointment over failing to net an award term, McMillan
wrote, “I am pleased to note that our federal partners once again
acknowledged our strong performance in the areas of mission and science.
We continue to provide strong value to the national security missions
and Los Alamos continues to be regarded highly for the quality of its
“Our federal partners made it clear that shortcomings in our work
planning and work controls related to safety events, project
performance, cybersecurity, the earned value management system (EVMS)
and continued weaknesses in criticality safety all weighed heavily in
the evaluation of our performance. These are areas we must – and will –
improve going forward,” said McMillan.
He also wrote, “I remain committed to the long-term sustainability of
the Laboratory and to each of you. I am scheduling an all-employee
meeting shortly after the New Year to hear and address your thoughts,
concerns, and questions. Los Alamos will continue to have a valued role
in protecting the nation and the world. It is incumbent upon us during
the remainder of the contract period to deliver mission success through
operational effectiveness and scientific excellence.”
Jay Coghlan of the Nuclear Watch New Mexico watchdog group said the
situation as described by McMillan, with LANS getting an extension
despite failing to earn an award term, was “deja vu all over again,”
similar to a later-rescinded waiver that granted LANS an award year for
fiscal 2012, although it hadn’t met all the performance criteria. “It
seems awfully premature for director McMillan to indicate there’s going
to be a contract extension before it’s actually finalized by the U.S.
government,” Coghlan said. “He’s putting the cart before the horse,
maybe putting on a happy face for his employees before they leave for
Feds won’t renew contract for private LANL operator
Posted: Friday, December 18, 2015 9:30 pm | Updated: 10:24 pm, Fri Dec 18, 2015.
By Justin Horwath
The New Mexican | 0 comments
The private consortium that runs Los Alamos National Laboratory will not have its contract renewed after it ends Sept. 30, 2017, The New Mexican has learned. The consortium is currently in negotiations with the federal government that could extend the $2.2 billion annual contract beyond 2017, even as the contract is put back up for bid, according to a person familiar with the discussions.
The decision not to renew the contract follows a blistering series of federal investigations and performance evaluations involving the lab’s safety record after a drum from the lab burst and leaked radiation at the Waste Isolation Pilot Plant in February 2014 near Carlsbad, shutting down the nation’s only underground nuclear repository indefinitely.
The Department of Energy notified staffers with the New Mexico congressional delegation about the decision to put the contract up for bid on Friday, according to the person, who spoke on condition of anonymity because he was not authorized to discuss the matter. Members of the delegation were not available for comment Friday evening.
Lab officials did not immediately return calls seeking comment Friday evening.
The lab has been run since 2006 by Los Alamos National Security, which took over operations after years of accounting scandals, security lapses and other management issues. The company is made up of a partnership between the University of California, Bechtel Corp., Babcock & Wilcox Co., URS Corp. and AECOM.
But the consortium repeatedly has run into its own problems over the past several years. In 2013, the National Nuclear Safety Administration, the arm of the Department of Energy that oversees the lab’s contract, denied LANS a one-year extension of its contract to operate the lab because it fell short of its goals for repairing and reopening some weapons facilities. Still, the NNSA awarded LANS about $52 million in performance fees, or 87 percent of the full amount possible in 2013.
Then, last December, the NNSA issued a stinging performance evaluation in the wake of the WIPP leak. In that evaluation, the lab received grades of “unsatisfactory” in key areas that cost the consortium a year on its contract and about $57 million in incentives.
The lab has received the results of its latest performance evaluation for 2015, according to an internal memo obtained byThe New Mexican. The results, though better, were not good enough to earn a “unilateral” addition of another year in what is known in the contract as an “award term.”
“While I am deeply disappointed that we did not meet NNSA’s expectations in a manner sufficient to net another year of award term, I am extremely proud of our accomplishments,” lab Director Charles F. McMillan wrote in the Thursday, Dec. 17, memo to lab employees.
In the memo, McMillan focuses on the positives and does not mention that the contract will be up for renewal, but the language underscores the gravity of the situation.
“Understandably, this news is sure to generate questions for each of you,” McMillan wrote. “Nevertheless, I once again express my deeply held belief that the Laboratory’s greatest asset continues to be its people.”
A few paragraphs later, he writes, “I am scheduling an all-employee meeting shortly after the New Year to hear and address your thoughts, concerns, and questions.”
The new evaluation is not expected to be released publicly for a few weeks. But the memo purports to show substantially better results than in 2014. The memo says the lab received high scores in four of six categories, including management of the nuclear weapons mission and its mission of reducing global nuclear security threats. But it received only a “satisfactory” in the category of “operations and infrastructure.”
The lab needed to receive better than “satisfactory” in all six categories to qualify for an additional year in its contract.
“We did not accomplish this,” McMillan wrote. He added, however, that the NNSA has offered the consortium an extension. “I will provide additional details about that at a later date after there has been more discussion between the federal government and LANS,” he wrote.
“Our federal partners,” he added, “made it clear that shortcomings in our work planning and work controls related to safety events, project performance, cybersecurity, the earned value management system (EVMS), and continued weaknesses in criticality safety all weighed heavily in the evaluation of our performance,” McMillan wrote. “These are areas we must — and will — improve going forward.”
Justin Horwath can be reached at 986-3017 [email protected].