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entitled 'Nuclear Nonproliferation: Progress Made in Improving Security 
at Russian Nuclear Sites, but the Long-term Sustainability of U.S.-
Funded Security Upgrades Is Uncertain' which was released on April 2, 
2007. 

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Report to Congressional Requesters: 

February 2007: 

Nuclear Nonproliferation: 

Progress Made in Improving Security at Russian Nuclear Sites, but the 
Long-term Sustainability of U.S.-Funded Security Upgrades Is Uncertain: 

GAO-07-404: 

GAO Highlights: 

Highlights of GAO-07-404, a report to congressional requesters 

Why GAO Did This Study: 

Safeguarding nuclear warheads and materials that can be used to make 
nuclear weapons is a primary national security concern of the United 
States. Since 1993, the Departments of Energy (DOE) and Defense (DOD) 
have worked to improve security at sites housing weapons-usable nuclear 
material and warheads in Russia and other countries. In 1995, DOE 
established the Materials Protection, Control, and Accounting (MPC&A) 
program to implement these efforts. GAO examined the (1) progress DOE 
has made in improving security at nuclear material sites in Russia and 
other countries, (2) progress DOE and DOD have made in improving 
security at Russian nuclear warhead sites, and (3) efforts DOE and DOD 
have undertaken to ensure the continued effective use of U.S.-funded 
security upgrades. To address these objectives, among other things, GAO 
analyzed agency documents, conducted interviews with key program 
officials, and visited four Russian nuclear sites 

What GAO Found: 

Through fiscal year 2006, DOE and DOD spent over $2.2 billion to 
provide security upgrades and other assistance at sites in Russia and 
other countries that house weapons-usable nuclear materials and 
warheads. With regard to securing nuclear material, DOE reports to have 
“secured” 175 buildings and plans to improve security at 35 additional 
buildings by the end of 2008. However, DOE’s reported total of 
buildings “secured” does not recognize that additional upgrades remain 
to be completed at some buildings because DOE considers a building 
“secured” after it has received only limited MPC&A upgrades, even when 
additional comprehensive upgrades are planned. Further, DOE and Russia 
have developed a Joint Action Plan that includes 20 sites and details 
the remaining work to be accomplished by 2008. However, the plan does 
not include two sites containing many buildings with vast amounts of 
nuclear material where Russia has denied DOE access. 

DOE and DOD report to have improved security at 62 Russian warhead 
sites and plan to help secure 35 additional sites by the end of 2008. 
The departments have improved their coordination mechanisms since our 
2003 report, in which GAO reported that the agencies had inconsistent 
policies for installing site security upgrades at Russian warhead 
sites. Additionally, DOE and DOD are using similar approaches to manage 
large security upgrade contracts at warhead sites. DOD has used earned 
value management (EVM), which at early stages can identify cost and 
schedule shortfalls. DOE has not used EVM on its fixed-price contracts, 
but, during the course of GAO’s review, augmented its contract 
oversight to increase reporting frequency, which DOE officials consider 
a comparable alternative to EVM. 

DOE has developed broad guidelines to direct its efforts to help ensure 
that Russia will be able to sustain (operate and maintain) U.S.-funded 
security systems at its nuclear material and warhead sites after U.S. 
assistance ends and is working with Russia to develop a joint 
sustainability plan. However, DOE lacks a management information system 
to track the progress made toward its goal of providing Russia with a 
sustainable MPC&A system by 2013. DOE and DOD’s abilities to ensure the 
sustainability of U.S.-funded security upgrades may be hampered by 
access difficulties, funding concerns, and other issues. Finally, DOE 
and DOD plan to provide Russia with assistance to sustain security 
upgrades at nuclear warhead sites but have not reached agreement with 
Russia on access procedures for sustainability visits to 44 sites. As a 
result, the agencies may be unable to determine if U.S.-funded security 
upgrades are being properly sustained. 

Table: 

Category: Nuclear material (DOE); 
Progress: DOE has helped improve security at 175 of 210 buildings with 
nuclear material in Russia and other countries; Spending: $1.3 billion. 

Category: Nuclear warheads (DOE and DOD); Progress: DOE and DOD have 
completed work at 62 of 97 planned sites and provided assistance to 
improve warhead transportation security; Spending: $920 million. 

Sources: GAO analysis of DOE and DOD data. 

[End of table] 

What GAO Recommends: 

GAO recommends that DOE (1) revise the metrics it uses to track 
progress in securing buildings with weapons-usable nuclear material and 
(2) develop a management information system to track DOE’s progress in 
providing Russia with a sustainable MPC&A system by 2013. 

DOE agreed with GAO’s findings and recommendations. DOD did not provide 
written comments. 

[Hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-07-404]. 

To view the full product, including the scope and methodology, click on 
the link above. For more information, contact Gene Aloise at (202) 512-
3841 or aloisee@gao.gov. 

[End of section] 

Contents: 

Letter: 

Results in Brief: 

Background: 

Since Fiscal Year 1993, DOE Has Spent About $1.3 Billion to Provide 
Security Upgrades at Nuclear Material Sites in Russia and Other 
Countries, but DOE's Reporting of the Number of Buildings Secured May 
Be Misleading: 

DOD and DOE Have Spent About $920 Million to Help Russia Secure 62 
Nuclear Warhead Sites and to Improve Warhead Transportation Security: 

Long-term Sustainability of U.S.-Funded Security Upgrades Is Uncertain 
because Access Problems and Other Issues May Hamper DOE and DOD 
Sustainability Efforts: 

Conclusions: 

Recommendations for Executive Action: 

Agency Comments and Our Evaluation: 

Appendixes: 

Appendix I: Scope and Methodology: 

Appendix II: Time Line of Major Events in the History of U.S. Efforts 
to Secure Nuclear Material and Warheads in Russia and Other Countries: 

Appendix III: Additional Information on DOE Efforts to Secure Sites 
with Weapons-Usable Nuclear Material in Countries Other Than Russia: 

Belarus: 

China: 

Georgia: 

India: 

Latvia: 

Lithuania: 

Kazakhstan: 

Ukraine: 

Uzbekistan: 

Appendix IV: Additional Information on DOE's National Infrastructure 
and Related Programs: 

Material Consolidation and Conversion: 

Secure Transportation: 

Training and Technical Support Infrastructure: 

Russian Federation Inspection Implementation: 

Protective Forces Assistance: 

Federal Information System: 

Regulatory Development: 

MPC&A Education: 

Material Control and Accounting Measurements: 

MPC&A Security Culture: 

Taxation and Customs: 

Appendix V: Comments from the Department of Energy: 

Appendix VI: GAO Contact and Staff Acknowledgments: 

Related GAO Products: 

Tables: 

Table 1: Status of DOE Security Enhancements at Buildings with Weapons- 
Usable Nuclear Material through the End of Fiscal Year 2006: 

Table 2: DOE and DOD Progress in Helping Russia Secure Nuclear Warhead 
Sites: 

Table 3: Seven Elements of Sustainability in DOE's Guidelines: 

Table 4: DOE Spending on Crosscutting MPC&A Assistance Efforts through 
the End of Fiscal Year 2006: 

Figures: 

Figure 1: Organizational Structure of DOE's Office of International 
Material Protection and Cooperation: 

Figure 2: DOE Spending to Secure Nuclear Materials in Russia and Other 
Countries through the End of Fiscal Year 2006: 

Figure 3: U.S. Spending on Nuclear Warhead Security in Russia through 
the End of Fiscal Year 2006: 

Figure 4: Map Showing DOE Spending by Country through the End of Fiscal 
Year 2006 for MPC&A Assistance Outside of Russia: 

Abbreviations: 

DOD: Department of Defense: 

DOE: Department of Energy: 

EVM: earned value management: 

FIS: Federal Information System: 

HEU: highly enriched uranium: 

MIMS: Metrics Information Management System: 

MOD: Ministry of Defense (Russia): 

MOM: MPC&A Operations Monitoring: 

MPC&A: Materials Protection, Control, and Accounting: 

NNSA: National Nuclear Security Administration: 

OMB: Office of Management and Budget: 

Rosatom: Federal Agency for Atomic Energy of the Russian Federation: 

February 28, 2007: 

The Honorable Carl Levin: 
Chairman: 
Permanent Subcommittee on Investigations: 
The Honorable Norm Coleman: 
Ranking Member: 
Permanent Subcommittee on Investigations: 
Committee on Homeland Security and Governmental Affairs: 
United States Senate: 

The Honorable John D. Dingell: 
Chairman: 
Committee on Energy and Commerce: 
House of Representatives: 

Safeguarding nuclear warheads and nuclear materials that can be used to 
make nuclear weapons is a primary national security concern of the 
United States and Russia. The collapse of the Soviet Union left Russia 
with the largest arsenal of nuclear weapons in the world with 
unclassified U.S. estimates of the number of Russia's nuclear warheads 
at the end of the cold war ranging from 18,000 to 25,000. Russia also 
inherited an estimated 600 metric tons of highly enriched uranium and 
plutonium--materials that could be used to build nuclear 
weapons.[Footnote 1] Terrorists or countries seeking nuclear weapons 
could use as little as 25 kilograms of highly enriched uranium or 8 
kilograms of plutonium to construct a nuclear weapon. During the Soviet 
era, security systems at Soviet nuclear sites emphasized heavy 
surveillance of site workers with severe penalties imposed on those who 
violated security procedures. However, the fall of the Soviet Union and 
subsequent social, political, and economic changes in Russia and other 
former Soviet republics exposed gaps in the physical security and 
material accounting at sites containing nuclear material and revealed 
weaknesses in these countries' abilities to secure nuclear sites 
against internal and external threats of theft. 

Since the early 1990s, there has been concern that unsecured nuclear or 
radioactive material could fall into the hands of terrorists and be 
smuggled into the United States for use in a nuclear weapon or a device 
that uses conventional explosives with radioactive material (known as a 
"dirty bomb"). For example, in January 2007, international media 
reported that authorities in Georgia had seized about 100 grams of 
highly enriched uranium from a Russian citizen who was attempting to 
sell the material on the black market.[Footnote 2] Key to the United 
States' efforts to combat this threat is securing nuclear materials and 
warheads at vulnerable civilian and military sites in the former Soviet 
Union and other countries. In 1991, the Congress authorized the 
Department of Defense (DOD) to establish the Cooperative Threat 
Reduction program to help Russia, Ukraine, Belarus, and Kazakhstan 
secure and protect former Soviet nuclear weapons.[Footnote 3] Members 
of the Congress were concerned that nuclear weapons or materials might 
be lost, stolen, or sold and that nuclear scientists and technicians 
might be persuaded to sell their knowledge to nations or terrorists 
seeking to develop nuclear weapons. Between fiscal years 1992 and 2006, 
the Congress authorized about $9 billion for a variety of nuclear 
nonproliferation programs implemented by DOD and the Department of 
Energy (DOE), including efforts to help Russia and other countries 
secure sites where nuclear material and warheads are located. In 1993, 
DOE and the Russian government began working together to secure sites 
housing weapons-usable nuclear material and, in 1995, DOE established 
the Materials Protection, Control, and Accounting (MPC&A) program, 
which is now administered by the National Nuclear Security 
Administration (NNSA).[Footnote 4] Through its MPC&A program,[Footnote 
5] DOE has provided nuclear facilities in Russia and other countries 
with modern nuclear security systems that include the following, among 
other things: 

* physical protection systems, such as fences around buildings 
containing nuclear materials; metal doors protecting rooms where 
nuclear materials are stored; and video surveillance systems to monitor 
storage rooms; 

* material control systems, such as seals attached to nuclear material 
containers to indicate whether material has been stolen from the 
containers, and badge systems that allow only authorized personnel into 
areas containing nuclear material; and: 

* material accounting systems, such as nuclear measurement equipment 
and computerized databases to inventory the amount and type of nuclear 
material contained in specific buildings and to track their location. 

In 1998, DOE issued guidelines that provide a systematic approach for 
DOE program managers to develop and implement MPC&A systems that meet 
DOE's objective of helping Russia and other countries secure buildings 
with weapons-usable nuclear material and nuclear warhead storage 
sites.[Footnote 6] DOE seeks to improve security at nuclear sites in 
Russia and other countries by providing security upgrades that protect 
against threats of theft from both internal adversaries, such as 
disgruntled nuclear workers (called the "insider" threat), and external 
adversaries, such as terrorist groups. DOE conducts these site security 
upgrades in two phases known as "rapid" upgrades and "comprehensive" 
upgrades. 

* Rapid upgrades include such improvements as bricking up windows in 
buildings where nuclear material is stored; installing strengthened 
doors, locks, and nuclear container seals; establishing controlled 
access areas around nuclear material; and implementing procedures that 
require the presence of two people when nuclear material is handled 
(called the "two-person rule"). Rapid upgrades are primarily designed 
to be simple, easy to implement and maintain, and result in immediate, 
though limited, improvements to nuclear material security. Rapid 
upgrades include upgrades designed to detect and delay external 
adversaries and sometimes include basic material control and accounting 
equipment and procedures that can be implemented during a 6-to-12 month 
period. 

* Comprehensive upgrades include electronic sensors, motion detectors, 
and closed circuit television systems to detect intruders; central 
alarm stations, where guards can monitor cameras and alarms; and 
computerized nuclear material accounting systems. Comprehensive 
upgrades are designed to secure against both internal and external 
threats and are usually put in place over the 18-to-24 months after the 
rapid upgrades have been installed but can be installed concurrently in 
some cases. 

Buildings that contain nuclear material, which DOE considers to be of a 
high proliferation threat receive both rapid and comprehensive 
upgrades, and buildings with nuclear material of less concern may 
receive only rapid upgrades. In addition to providing security 
upgrades, DOE provides a variety of training to foreign officials and 
nuclear site personnel on how to operate MPC&A systems. 

In February 2006, DOE changed the metrics it uses to track progress in 
its MPC&A program from measuring the percentage of nuclear material 
secured (out of the estimated 600 metric tons of loose nuclear material 
in the former Soviet Union) to measuring the number of buildings in 
Russia and other countries with weapons-usable nuclear material that 
have been secured.[Footnote 7] DOE currently plans to secure 210 
buildings containing weapons-usable nuclear material in Russia and 
other countries by the end of 2008. 

The United States has also assisted Russia in improving security at 
nuclear warhead storage sites, both temporary sites, such as rail 
transfer points, and permanent sites containing storage bunkers. In 
1995, DOD began assisting the Russian Ministry of Defense (MOD) with 
enhancing transportation security for nuclear warheads and security at 
nuclear warhead sites. Also, in 1998, at Russia's request, DOE expanded 
the scope of its efforts with the Russian Navy from protecting naval 
reactor fuel to helping secure nuclear warheads. In February 2005, 
President Bush and Russian President Putin issued a joint statement on 
nuclear security cooperation, including enhanced cooperation on nuclear 
terrorism prevention efforts.[Footnote 8] In 2006, Presidents Bush and 
Putin reaffirmed their commitment to completing security upgrades at 
nuclear material and warhead sites in Russia by the end of 
2008.[Footnote 9] DOE and DOD plan to help Russia secure a total of 97 
nuclear warhead sites by the end of 2008. 

After completing the installation of site security upgrades, DOE and 
DOD provide ongoing technical and financial support to help ensure that 
U.S.-funded security upgrades continue to reduce the risk of theft at 
foreign nuclear sites. These efforts are known as sustainability 
activities. Sustainability support is necessary to ensure that U.S.- 
funded security upgrades are properly maintained and continue to 
support risk reduction goals as intended. However, security of nuclear 
material and warheads in Russia and other countries ultimately depends 
on these countries' ability to sustain the continued operation of U.S.- 
funded security upgrades after U.S. funding ends. In 2002, the Congress 
directed DOE to work with Russia to develop a sustainable MPC&A system 
to be solely supported by Russia no later than January 1, 
2013.[Footnote 10] 

As agreed with your offices, this report addresses U.S. efforts to 
secure nuclear material and warheads in Russia and other countries by 
assessing: (1) the progress DOE has made in helping Russia and other 
countries secure weapons-usable nuclear material, (2) the progress DOE 
and DOD have made in helping Russia secure its nuclear warhead sites, 
and (3) the efforts undertaken by DOE and DOD to ensure the 
sustainability and continued use of U.S.-funded security upgrades at 
sites that house nuclear materials and warheads in Russia and other 
countries. 

To address these objectives, we analyzed documentation from DOE and its 
contractors at Los Alamos, Oak Ridge, and Sandia National Laboratories; 
DOD; and DOD contractors. We conducted interviews with key program 
officials at each of these agencies and at the Department of State. We 
also discussed the implementation of DOE and DOD's programs with 
Russian officials. However, the Federal Agency for Atomic Energy of the 
Russian Federation (Rosatom), which is responsible for the production 
of all nuclear materials in Russia and the development, testing, and 
production of Russian nuclear weapons, denied our request for access to 
facilities under its control. We were able to complete our audit 
objectives by visiting four Russian nuclear facilities--civilian, 
educational, and research institutes not under Rosatom's control--where 
DOE installed MPC&A upgrades. We discussed security issues and the 
sustainability of MPC&A upgrades with officials at these sites. In 
addition, we analyzed cost and budgetary information from DOE and DOD 
on U.S. efforts to help Russia and other countries secure nuclear 
materials and warheads. We interviewed knowledgeable DOE and DOD 
officials on the reliability of these data, including issues such as 
data entry, access, quality control procedures, and the accuracy and 
completeness of the data. We determined these data were sufficiently 
reliable for the purposes of this report. More details on our scope and 
methodology can be found in appendix I. We conducted our review from 
April 2006 to February 2007 in accordance with generally accepted 
government auditing standards. 

Results in Brief: 

From fiscal year 1993 through fiscal year 2006, DOE spent about $1.3 
billion to provide security upgrades and other related assistance to 
sites with buildings that house weapons-usable nuclear material in 
Russia and other countries, and the agency reports to have "secured" 
175 buildings containing about 300 metric tons of weapons-usable 
nuclear material. However, the number of secured buildings does not 
fully present the extent and nature of upgrades made and work remaining 
to be completed because DOE considers a building to be "secure" after 
it has received only limited MPC&A upgrades (rapid upgrades), even when 
additional comprehensive upgrades have yet to be completed. 
Specifically, 51 of the 175 buildings DOE reported to have "secured" by 
the end of fiscal year 2006 do not have completed MPC&A upgrades. While 
DOE officials told us that rapid upgrades offer a measure of risk 
reduction against some threats, they also noted that rapid upgrades do 
not meet all of DOE's risk reduction goals for most buildings with 
weapons-usable nuclear material. Further, in response to terrorist 
actions and rising threat levels in Russia, DOE is examining the impact 
of an increased design basis threat for its MPC&A program and providing 
additional assistance to protective forces at Russian nuclear sites. 
Finally, DOE and Rosatom have developed a Joint Action Plan that 
includes 20 civilian and nuclear weapons complex sites housing 
buildings with weapons-usable nuclear material. While the plan details 
the remaining scope of work to be accomplished by 2008, it does not 
include two key sites involved in manufacturing of Russian nuclear 
warheads that contain many buildings with hundreds of metric tons of 
weapons-usable nuclear material. Because of the sensitive nature of the 
work conducted at these sites, Rosatom has denied DOE's proposals for 
upgrading the sites, including proposals with less intrusive access 
requirements, and informed DOE that it is not interested in pursuing 
MPC&A cooperation at these sites. 

Since 1995, DOE and DOD have spent about $920 million to help Russia 
improve security at 62 nuclear warhead sites, and the agencies plan to 
help Russia secure 35 additional sites by the end of 2008. Through the 
end of fiscal year 2006, DOE spent about $374 million to help Russia 
secure 50 nuclear warhead sites, while DOD spent about $546 million to 
secure 12 nuclear warhead storage sites and to improve security for the 
transportation of Russian warheads. DOE plans to provide security 
upgrades at 23 additional sites, and DOD plans to provide upgrades at 
12 additional sites by the end of 2008. Coordination between DOE and 
DOD has improved since 2003, when we reported that the agencies had 
inconsistent policies for installing site security upgrades at Russian 
nuclear warhead sites. For example, DOE and DOD have now jointly 
developed common designs for security upgrades at similar Russian 
warhead sites in order to ensure a level of consistency in the 
assistance provided to these sites. We also found that DOE and DOD use 
similar approaches to managing large contracts to provide security 
upgrades at Russian nuclear warhead sites. DOD has used an earned value 
management (EVM) system to identify cost and schedule variances on 
contracts to provide security upgrades at Russian nuclear warhead sites 
so they can be addressed in a timely manner. DOE does not require its 
contractors to implement EVM systems on its fixed-price contracts for 
installing security upgrades at Russian warhead sites. However, during 
the course of our review, the department augmented its contract 
oversight mechanisms, and DOE officials believe that their improved 
oversight system constitutes a comparable alternative to an EVM system. 

As DOE and DOD near the completion of their security upgrade programs, 
the sustainability of U.S.-funded nuclear security upgrades in Russia 
and other countries has become increasingly important for ensuring that 
the substantial investment of U.S. funds over the past 15 years is not 
wasted. To this end, DOE has developed broad guidelines to direct its 
efforts to help ensure that Russia will be able to sustain (operate and 
maintain) U.S.-funded security systems at its nuclear material and 
warhead sites after U.S. assistance ends and is working with Rosatom to 
develop a joint U.S.-Russian sustainability plan. However, DOE lacks a 
management information system to assist MPC&A management in tracking 
the progress being made toward its goal of providing Russia a 
sustainable MPC&A system by 2013, similar to the system DOE uses to 
track the number of buildings and sites where it has installed security 
upgrades. Further, access challenges and other issues could impact DOE 
and DOD's ability to prepare Russia to sustain U.S.-funded security 
upgrades on its own. In 2002, the Congress directed DOE to work with 
Russia to provide a sustainable MPC&A system to be solely supported by 
Russia no later than January 1, 2013. In response, DOE issued interim 
guidelines in May 2004 to direct its efforts to create a sustainable 
MPC&A system in Russia and finalized these guidelines in December 2006. 
DOE's sustainability guidelines include seven key elements, such as a 
site MPC&A operational plan and preventative maintenance program. 
However, access difficulties, sites' financial ability to maintain 
equipment, and other issues could impact DOE's ability to prepare 
Russia to sustain security upgrades at nuclear material sites. For 
example, at one facility where DOE completed upgrades in 1998, DOE 
officials were denied access from 1999 through 2002 and, upon returning 
to the facility, found the security upgrades were in a severe state of 
disrepair. As a result, DOE had to spend about $800,000 to correct 
problems resulting from the site's inability to properly maintain the 
security upgrades DOE had provided. Finally, DOE and DOD also plan to 
provide Russia with assistance to sustain U.S.-funded security upgrades 
at nuclear warhead sites, but access difficulties may prevent the 
agencies from carrying out their plans. Specifically, neither DOE nor 
DOD has reached an agreement with the Russian Ministry of Defense on 
access procedures for sustainability visits to 44 permanent warhead 
storage sites. Site access or alternative means of verification are 
necessary to ensure that U.S. funds are being used to help Russia 
maintain security upgrades at these sites. If DOE and DOD cannot reach 
an agreement with the Russian Ministry of Defense on access procedures 
for sustainability activities at these 44 sites, the agencies will be 
unable to determine if U.S.-funded security upgrades are being properly 
sustained and may not be able to spend funds appropriated for these 
efforts. 

To strengthen program management and the effectiveness of DOE's efforts 
to improve security at nuclear material and warhead sites in Russia and 
other countries, we are recommending that the Secretary of Energy, 
working with the Administrator of NNSA, (1) revise the metrics used to 
measure MPC&A program progress to better reflect the level of security 
upgrade completion at buildings reported as "secure" and (2) develop a 
management information system to track DOE's progress in providing 
Russia with a sustainable MPC&A system by 2013. 

We provided a draft of this report to DOE and DOD for comment. DOE 
generally agreed with our findings and recommendations. DOD had no 
written comments on our report. DOE provided additional information 
about the metric it uses to track progress in the MPC&A program, its 
reasons for not using EVM on fixed-price contracts, and on its efforts 
to work with Rosatom on sustainability issues. DOE and DOD also 
provided technical comments, which we incorporated, as appropriate. 

Background: 

In 1993, DOE and the Russian government began working together to 
secure sites housing weapons-usable nuclear material and, in 1995, DOE 
established the MPC&A program, which is now administered by NNSA. DOE's 
Office of International Material Protection and Cooperation, within 
NNSA, consists of five offices whose collective efforts contribute to 
enhancing the security of nuclear material and warheads in countries of 
concern and to improving the ability to detect illicit smuggling of 
those materials (see fig. 1). Four of these offices implement DOE's 
MPC&A program, which, among other things, provides security upgrades at 
nuclear sites in Russia and other countries, and the fifth office, the 
Office of the Second Line of Defense, works to improve detection of 
illegal nuclear trafficking activities at border crossings and 
seaports.[Footnote 11] 

Figure 1: Organizational Structure of DOE's Office of International 
Material Protection and Cooperation: 

[See PDF for image] - graphic text: 

Source: DOE. 

[End of figure] - graphic text: 

The Office of Nuclear Warhead Protection works with the Russian 
Ministry of Defense, including the 12TH Main Directorate--the Russian 
Defense Ministry's organization for nuclear munitions, the Strategic 
Rocket Forces, and the Navy to install security upgrades at nuclear 
warhead storage sites. The Office of Nuclear Warhead Protection also 
oversees DOE's security upgrades work at naval nuclear fuel sites. The 
Office of Weapons Material Protection upgrades MPC&A systems at sites 
within the Rosatom nuclear weapons complex and also oversees DOE 
efforts to sustain U.S.-funded security upgrades at nuclear sites 
within the former Soviet Union that are not in Russia, such as 
facilities in Ukraine and Uzbekistan. The Office of Material 
Consolidation and Civilian Sites works to install MPC&A upgrades at 
nonmilitary nuclear facilities throughout Russia and oversees efforts 
to consolidate nuclear material into fewer buildings and to convert 
excess weapons-usable nuclear material into less attractive forms. The 
Office of Material Consolidation and Civilian Sites also manages DOE's 
efforts to provide nuclear security assistance to countries outside of 
the former Soviet Union. The Office of National Infrastructure and 
Sustainability manages a variety of crosscutting programs, including 
transportation and protective forces assistance, and oversaw the 
development of guidelines for DOE's efforts to help ensure that Russia 
can sustain the operation of U.S.-funded security systems at its 
nuclear sites after U.S. assistance ends. 

DOD has also assisted Russia in securing nuclear warhead storage sites, 
both temporary sites, such as rail transfer points, and permanent sites 
containing storage bunkers. In 1995, DOD began assisting the Russian 
Ministry of Defense with enhancing transportation security for nuclear 
warheads and security at nuclear warhead sites. DOD's efforts to help 
Russia secure its nuclear warhead storage sites and to improve the 
security of warheads in transit are implemented by the Defense Threat 
Reduction Agency. Oversight and policy guidance for this work is 
provided by DOD's Office of the Undersecretary of Defense for Policy. 
Additional information on the history of U.S. efforts to help Russia 
and other countries secure nuclear material and warheads can be found 
in appendix II. 

Since Fiscal Year 1993, DOE Has Spent About $1.3 Billion to Provide 
Security Upgrades at Nuclear Material Sites in Russia and Other 
Countries, but DOE's Reporting of the Number of Buildings Secured May 
Be Misleading: 

DOE spent about $1.3 billion between fiscal year 1993 and fiscal year 
2006 to provide security upgrades and other related assistance to 
facilities that house weapons-usable nuclear material in Russia and 
other countries and reports to have "secured" 175 buildings containing 
about 300 metric tons of weapons-usable nuclear material in Russia and 
the former Soviet Union. The number of buildings that DOE reports as 
secured, however, does not recognize that additional upgrades remain to 
be completed at some buildings because DOE considers a building to be 
"secure" after it has received only limited MPC&A upgrades (rapid 
upgrades), even when additional comprehensive upgrades have yet to be 
completed. Further, in response to terrorist actions and rising threat 
levels in Russia, DOE is examining the impact of an increased design 
basis threat it uses to measure the adequacy of security upgrades 
provided to Russian nuclear facilities and providing additional 
assistance to protective forces at Russian nuclear sites. Finally, DOE 
and Rosatom have developed a Joint Action Plan that includes 20 
civilian and nuclear weapons complex sites housing buildings with 
weapons-usable nuclear material. While the plan details the remaining 
scope of work to be accomplished by 2008, it does not include two key 
sites involved in manufacturing of Russian nuclear warheads that 
contain many buildings with hundreds of metric tons of weapons-usable 
nuclear material where DOE has been denied access. 

Through the End of Fiscal Year 2006, DOE Spent About $1.3 Billion for 
Security Upgrades and Other Related Assistance at Nuclear Material 
Sites in Russia and Other Countries: 

From fiscal year 1993 to fiscal year 2006, DOE spent about $1.3 billion 
to enhance security at buildings that house weapons-usable nuclear 
materials in foreign countries. The majority of these buildings are 
located in Russia and fall into three categories: Rosatom weapons 
complex sites, civilian sites, and naval fuel sites. DOE has also 
helped to secure buildings with weapons-usable nuclear material in nine 
other countries.[Footnote 12] Figure 2 shows a breakdown of DOE's 
spending on MPC&A efforts. 

Figure 2: DOE Spending to Secure Nuclear Materials in Russia and Other 
Countries through the End of Fiscal Year 2006: 

[See PDF for image] - graphic text: 

Source: GAO analysis of DOE data. 

Note: Figure does not include program management expenses, and amounts 
have been rounded. 

[End of figure] - graphic text: 

As figure 2 shows, DOE spent about $684.7 million to provide security 
upgrades to civilian, naval fuel, and Rosatom weapons complex sites 
with weapons-usable nuclear material in Russia and an additional $131.5 
million to provide security upgrades to sites located outside of 
Russia. DOE also spent about $493.9 million on additional and related 
MPC&A efforts in Russia, such as assistance for transportation 
security, providing equipment for protective forces at nuclear 
facilities, and efforts to consolidate nuclear material into fewer 
buildings and sites. According to DOE officials, these efforts are 
important to increasing the overall security of nuclear materials in 
Russia and other countries, and they support DOE's goal of enhancing 
the security of vulnerable stockpiles of weapons-usable nuclear 
material. For example, because DOE believes that nuclear materials are 
most vulnerable while they are in transit, the department has provided 
Russia with specialized secure trucks, armored escort vehicles, and 
secure containers--called overpacks--to improve the security of nuclear 
material transported within and between nuclear sites in Russia. 
Further, DOE's assistance to protective forces at Russian nuclear 
sites, which includes such items as bulletproof vests, helmets, and 
response vehicles, helps ensure that guards at those sites are properly 
equipped and trained so that they can quickly respond to alarms. 
Additional information on other DOE efforts to improve security at 
sites with weapons-usable nuclear materials can be found in appendix 
IV. 

DOE Considers Buildings "Secure" After Only Limited or "Rapid" Upgrades 
Have Been Installed, Even When More Comprehensive Upgrades Are Planned: 

At the end of fiscal year 2006, DOE reported to have "secured" 175 
buildings containing about 300 metric tons of weapons-usable nuclear 
material in Russia and the former Soviet Union, but 51 of the 175 
buildings DOE reported to have "secured" as of the end of fiscal year 
2006 do not have completed MPC&A upgrades. These 51 buildings are 
located at sites in the Rosatom weapons complex. In its program 
metrics, DOE defined a building to be "secure" after it has received 
only limited MPC&A upgrades (called rapid upgrades), even when 
additional comprehensive upgrades, which would further improve 
security, have yet to be completed.[Footnote 13] 

The buildings with weapons-usable nuclear material where DOE is working 
to improve security fall into four categories: Rosatom weapons complex, 
civilian, naval fuel, and sites outside of Russia. As table 1 shows, 
all planned upgrades have been completed at naval fuel sites and sites 
outside of Russia. The vast majority of remaining buildings that have 
not yet received security upgrades are in the Rosatom weapons complex, 
where DOE has historically had access difficulties, including being 
denied access to key sites and buildings housing weapons-usable nuclear 
material. 

Table 1: Status of DOE Security Enhancements at Buildings with Weapons- 
Usable Nuclear Material through the End of Fiscal Year 2006: 

Site type: Rosatom weapons complex[A]; 
Number of buildings DOE reports as "secured" 92; 
Number of buildings where DOE has not installed security upgrades: 32; 
Total number of buildings where DOE plans to install security upgrades: 
124. 

Site type: Civilian; 
Number of buildings DOE reports as "secured" 47; 
Number of buildings where DOE has not installed security upgrades: 3; 
Total number of buildings where DOE plans to install security upgrades: 
50. 

Site type: Naval fuel; 
Number of buildings DOE reports as "secured" 21; 
Number of buildings where DOE has not installed security upgrades: 0; 
Total number of buildings where DOE plans to install security upgrades: 
21. 

Site type: Outside of Russia; 
Number of buildings DOE reports as "secured" 15; 
Number of buildings where DOE has not installed security upgrades: 0; 
Total number of buildings where DOE plans to install security upgrades: 
15. 

Site type: Total; 
Number of buildings DOE reports as "secured" 175; 
Number of buildings where DOE has not installed security upgrades: 35; 
Total number of buildings where DOE plans to install security upgrades: 
210. 

Source: DOE. 

[A] At some sites in the Rosatom weapons complex, DOE counts individual 
material storage or handling areas (material balance areas) within 
large buildings separately in its program performance measurements in 
an attempt to more accurately reflect the amount of work involved. 
According to DOE, the work that would go into securing a material 
balance area of this size would be commensurate to the work that goes 
into securing a smaller building. 

[End of table] 

While DOE officials told us that rapid upgrades offer a limited measure 
of risk reduction against some threats, they also noted that rapid 
upgrades fall short of meeting all of DOE's risk reduction goals for 
buildings with weapons-usable nuclear material. For example, rapid 
upgrades generally include only limited measures designed to address 
the insider threat of theft, such as establishing a two-person rule and 
providing certain types of tamper indication devices that would set off 
alarms at guard stations in the case of an unauthorized attempt to 
access nuclear materials. According to NNSA, which implements the MPC&A 
program at DOE, the greatest threat DOE faces in its effort to help 
Russia secure nuclear materials is the threat of insider theft. 
However, the majority of measures to address the insider threat at 
Russian nuclear material sites, such as computerized nuclear material 
inventory databases and barcoding of nuclear material containers, are 
provided in the comprehensive upgrades phase. 

DOE Is Examining the Impact of an Increased Design Basis Threat for Its 
MPC&A Program: 

In response to terrorist actions and rising threat levels in Russia, 
DOE recently analyzed the implications of an increased design basis 
threat it uses to measure the adequacy of security upgrades provided to 
Russian nuclear facilities. The design basis threat is defined as the 
attributes and characteristics of potential adversaries (a group or 
groups of armed attackers) against which a facility's physical 
protection systems are designed and evaluated. According to DOE, the 
design basis threat is critical to determining an MPC&A system's 
effectiveness. In 2005, DOE began examining the impact of increasing 
the number of adversaries against which Russian sites with U.S.-funded 
security upgrades should be able to defend themselves. DOE is currently 
reassessing the effectiveness of the security upgrades it has provided 
through the MPC&A program and has increased its emphasis on providing 
assistance to the protective forces at Russian nuclear material sites. 
Specifically, DOE is currently working with a number of sites to 
relocate guard forces closer to the target nuclear material to improve 
their response times to an incident. For example, at all four of the 
nuclear material sites we visited in Russia, Russian officials told us 
that they were working with DOE to relocate guard forces closer to 
buildings that contain weapons-usable nuclear material at their sites. 
However, DOE is limited in the scope of assistance it can provide to 
protective forces at nuclear facilities in Russia and other countries. 
For example, DOE is neither allowed to provide weapons or ammunition to 
these forces, nor is it allowed to pay the salaries of protective 
forces at these sites. According to DOE officials, the department has 
provided assistance to the protective forces at all nuclear material 
sites where the department has access and agreement to work, including 
helmets, winter uniforms, radios, and other equipment intended to 
improve their effectiveness in responding to alarms and their 
survivability against potential adversaries. 

DOE Plans to Complete All Security Upgrades Work by the End of 2008 but 
Lacks Access or Agreement to Work at Two Key Sites That Contain Vast 
Amounts of Nuclear Material: 

Historically, DOE has had difficulty obtaining access to some sensitive 
sites in Russia, especially within the Rosatom weapons complex. For 
example, we reported in 2003 that DOE's lack of access to many 
buildings that store weapons-usable nuclear material in the Rosatom 
weapons complex was the greatest challenge to improving nuclear 
material security in Russia. DOE requires access to these buildings to 
validate Russian security system designs and to confirm the 
installation of equipment as intended. DOE signed an access agreement 
with the Russian Ministry of Atomic Energy (now called Rosatom) in 
September 2001 that described administrative procedures to facilitate 
access, such as specifying which DOE personnel are allowed to make site 
visits and the number and duration of those visits. We reported in 2003 
that this access agreement had done little to increase DOE's ability to 
complete its work at many key sites in the Rosatom weapons complex. 
Since that time, DOE has worked with Rosatom through a Joint 
Acceleration Working Group and other mechanisms to develop alternative 
access procedures, such as the use of remote video monitoring, that 
have allowed work to progress at some sensitive buildings and sites 
that had previously been inaccessible to DOE project teams. In June 
2005, DOE and Rosatom signed a Joint Action Plan detailing the 
remaining scope of work to be completed by the 2008 deadline. Rosatom 
and DOE are using this plan to guide cooperative activities and to 
develop a multiyear budget for DOE's MPC&A program. DOE officials told 
us that they have been granted access to almost all of the sites and 
buildings covered in the plan and that all security upgrades should be 
completed, as scheduled, by the end of 2008. DOE plans to spend about 
$98 million to complete its planned security upgrades at 210 buildings 
containing weapons-usable nuclear material in Russia and other 
countries by the end of calendar year 2008. 

The DOE-Rosatom Joint Action Plan covers 20 Russian civilian and 
nuclear weapons complex sites. However, the Joint Action Plan does not 
include two key sites in the Rosatom weapons complex where Russian 
nuclear weapons are assembled and disassembled. Because of the nuclear 
weapons manufacturing work conducted at these sites, DOE believes these 
two sites contain many buildings with hundreds of metric tons of 
weapons-usable nuclear material. According to DOE officials, the 
department has offered numerous alternative access proposals to try to 
obtain access to install security upgrades at these two sites. For 
example, in November 2004, DOE provided senior Russian officials with 
access to some of the most sensitive sites in the U.S. nuclear weapons 
complex, including the Pantex nuclear weapons plant in Texas, which is 
the only U.S. nuclear weapons assembly and disassembly facility. 
However, Rosatom has refused to grant DOE officials reciprocal access 
to analogous Russian sites. Because of the sensitive nature of the work 
conducted at these sites, Rosatom has denied DOE's requests for access, 
rejected DOE offers to provide assistance without access, and informed 
DOE that it is not interested in pursuing MPC&A cooperation at these 
sites. DOE officials expressed very little optimism that Rosatom would 
allow DOE to help improve security at these facilities in the near 
future. 

DOD and DOE Have Spent About $920 Million to Help Russia Secure 62 
Nuclear Warhead Sites and to Improve Warhead Transportation Security: 

Through the end of fiscal year 2006, DOE and DOD spent about $920 
million to help Russia improve security at 62 nuclear warhead sites. 
The agencies plan to help Russia secure a total of 97 nuclear warhead 
sites by the end of 2008. Coordination between DOE and DOD has improved 
since 2003, when we reported that the agencies had inconsistent 
policies toward providing security assistance to Russian nuclear 
warhead sites. In addition, DOE and DOD are currently taking similar 
approaches to managing large contracts to provide security upgrades at 
Russian nuclear warhead sites. DOD has used EVM to identify cost and 
schedule variances for its contracts to install security upgrades at 
Russian warhead sites at early stages so they can be addressed in a 
timely manner. DOE has not used EVM on its fixed-price contracts to 
install security upgrades at Russian nuclear warhead sites, but, during 
the course of our review, the department augmented its contract 
performance management system to include additional reporting 
mechanisms to identify and address schedule variances, which DOE 
officials believe constitute a comparable alternative to an EVM system. 
DOE believes the benefits of EVM techniques do not justify the 
additional costs to implement them on fixed-price contracts. 

DOE and DOD Helped Russia Improve Security at 62 Nuclear Warhead 
Storage Sites and Provided Assistance to Improve Security of Warheads 
in Transit: 

Through the end of fiscal year 2006, DOE had spent about $374 million 
to improve security at 50 Russian nuclear warhead sites and plans to 
install security upgrades at 23 additional sites by the end of 2008. 
Additionally, DOD spent approximately $546 million to help Russia 
secure 12 warhead sites and to provide security for nuclear warheads in 
transit.[Footnote 14] DOD plans to complete security upgrades at 12 
additional sites by the end of 2008. Figure 3 shows a breakdown of U.S. 
funding to improve security of Russian nuclear warheads through the end 
of fiscal year 2006. 

Figure 3: U.S. Spending on Nuclear Warhead Security in Russia through 
the End of Fiscal Year 2006: 

[See PDF for image] - graphic text: 

Source: GAO analysis od DOE and DOD data. 

Note: DOD spending for nuclear warhead site security efforts includes 
spending on related DOD efforts, such as the development of an 
Automated Inventory Control and Management System for Russia's nuclear 
warhead stockpile, a personnel reliability program and training 
equipment for guard forces at nuclear warhead sites, an emergency 
response capability, and a variety of training for site personnel. 
DOE's program also includes training for site personnel and the 
development of a personnel reliability program for those Russian 
nuclear commands not supported by DOD. Percentages do not total 100 due 
to rounding. 

[End of figure] - graphic text: 

DOE plans to provide security upgrades at 23 additional sites, and DOD 
plans to provide upgrades at 12 additional sites by the end of 2008. 
DOE and DOD gained authorization and access to work at 15 of these 
sites as a result of an agreement reached at the summit between 
President Bush and Russian President Putin in Bratislava, Slovakia, in 
February 2005. After this summit, Russia offered access to 15 
additional nuclear warhead sites of which DOE has agreed to install 
upgrades at 7 sites, and DOD will help secure the remaining 8 sites. 
Table 2 provides an overview of DOE and DOD's progress in improving 
security at Russian nuclear warhead sites. 

Table 2: DOE and DOD Progress in Helping Russia Secure Nuclear Warhead 
Sites: 

Site type: Permanent warhead sites; 
DOE sites complete: 8; 
DOD sites complete: 9; 
Total sites completed: 17; 
DOE sites remaining: 14; 
DOD sites remaining: 10; 
Total sites remaining: 24. 

Site type: Temporary warhead sites; 
DOE sites complete: 42; 
DOD sites complete: 3; 
Total sites completed: 45; 
DOE sites remaining: 9; 
DOD sites remaining: 2; 
Total sites remaining: 11. 

Site type: Total; 
DOE sites complete: 50; 
DOD sites complete: 12; 
Total sites completed: 62; 
DOE sites remaining: 23; 
DOD sites remaining: 12; 
Total sites remaining: 35. 

Sources: GAO analysis of DOE and DOD information. 

[End of table] 

Despite the agencies' optimism that all sites within this scope will be 
secured by the end of 2008, they face challenges in meeting this goal. 
For example, DOE and DOD officials stated that work in Russia involves 
extensive bureaucracy, changing requirements to meet Russian demands 
and, at times, difficult relationships and coordination with Russian 
subcontractors. DOD officials told us that there have been performance 
issues with a certain Russian subcontractor, but finding alternatives 
is difficult because there are only a limited number of Russian 
subcontractors qualified for this type of work and cleared by the 
Russian MOD to work at nuclear weapons sites. Additionally, the harsh 
environmental conditions at some remote sites have caused delays in the 
installation of security upgrades. Specifically, DOD officials stated 
that adverse weather conditions delayed the installation of security 
upgrades at four Russian warhead sites by about 1 month. 

In addition, DOD spent over $125 million through the end of fiscal year 
2006 to improve the security of nuclear warheads during transportation 
by rail to consolidation and dismantlement sites. According to DOD 
officials, security experts consider nuclear warheads to be highly 
vulnerable to theft during transport. DOD has attempted to address this 
threat by providing the Russian MOD with security enhancements for 
railcars, hardened shipping containers for nuclear warheads to protect 
against small arms fire and other threats, and payment of railway 
tariffs associated with transporting nuclear warheads to consolidation 
and dismantlement sites. Since 1995, DOD has supported maintenance on 
200 specialized, secure railcars for transporting nuclear weapons and 
provided 15 armored railcars for guard forces protecting shipments of 
nuclear weapons. DOD is in the process of procuring up to 100 
additional nuclear warhead transport railcars for use by the Russian 
MOD. 

Coordination between DOE and DOD's Nuclear Warhead Security Efforts in 
Russia Has Improved: 

DOE and DOD have mechanisms for sharing information and avoiding 
duplication of effort. Coordination between the agencies has improved 
since 2003, when we reported that the agencies did not have consistent 
policies toward providing security assistance to Russian nuclear 
warhead sites. We recommended in 2003 that the departments work 
together to develop a standardized approach to improving security at 
Russian nuclear warhead sites. Since our 2003 report, DOD and DOE have 
expanded their efforts to share information about their work at Russian 
nuclear warhead sites. 

Specifically, the departments coordinate their efforts through an 
interagency working group, which reports to the National Security 
Council.[Footnote 15] According to DOE and DOD officials, this group 
was instrumental in coordinating the U.S. response to proposals for 
security upgrades at additional Russian nuclear warhead sites stemming 
from the summit between Presidents Bush and Putin at Bratislava, 
Slovakia, in 2005. In addition, DOE and DOD participate in joint 
coordinating groups that include key representatives from DOE, DOD, and 
the various branches of the Russian MOD. All of these groups meet 
regularly to discuss ongoing work at Russian nuclear warhead sites and 
resolve problems or issues that arise in this effort. Furthermore, DOE 
and DOD have jointly developed common designs for security upgrades at 
similar Russian warhead sites to ensure a level of consistency in the 
assistance provided to these sites. DOD officials stated that having a 
standardized design between the two agencies allows DOE and DOD 
leverage with the Russian MOD, to deny requests if they are made for 
items not in the site design plan of either agency. Further, DOE and 
DOD seek to present a united image to Russian officials by writing 
letters jointly on common issues and answering Russian site proposals 
together. 

DOE and DOD Use Similar Systems to Manage Large Contracts to Improve 
Security at Russian Nuclear Warhead Sites: 

In their efforts to provide security upgrades at Russian nuclear 
warhead sites, DOE and DOD are taking similar approaches to managing 
large contracts. Generally, OMB requires federal agencies to use 
EVM[Footnote 16] or an alternative performance management system on 
major acquisition contracts to identify cost and schedule variances at 
early stages so they can be addressed in a timely manner.[Footnote 17] 
DOD has used EVM to evaluate its contracts to install security upgrades 
at Russian warhead sites. DOE does not require its contractors to 
implement EVM to evaluate its contracts to install security upgrades at 
Russian warhead sites, but, during the course of our review, augmented 
its contract performance management system to include additional 
reporting mechanisms for identifying and addressing schedule variances, 
which DOE officials believe represent a comparable alternative to an 
EVM system. 

DOD officials stated that EVM is one of many tools that provide 
empirical data to validate testimonial information about the status of 
security upgrades provided in its contractors' monthly and quarterly 
reports. Additionally, EVM enhances program management capabilities by 
providing an early warning system for deviations from plans and 
quantifies technical and schedule problems in terms of cost. This 
provides DOD with an objective basis for considering corrective action. 
DOD officials told us that their use of EVM allowed them to identify 
schedule variances due to poor contractor performance at one Russian 
nuclear warhead site where the department is installing security 
upgrades. DOD officials stated that this early detection allowed them 
to reassign the work to a different Russian subcontractor and formulate 
a plan to make up for the lost time and work in order to meet their 
scheduled completion date and critical path milestones. 

Similarly, DOE recently proposed requirements that its large contracts 
for security upgrades at nuclear warhead sites be managed with a system 
similar to EVM. In September 2006, DOE initiated security upgrades at 
four large nuclear warhead storage sites in Russia.[Footnote 18] Until 
January 2007, DOE managed these fixed-price contracts according to the 
NNSA Programmatic Guidelines, which do not require the use of EVM or an 
alternative system to assess contract performance for cost and schedule 
variances. In part, as a result of our inquiry into its contracting 
practices, DOE altered its oversight mechanisms for these contracts in 
January 2007 and will now require monthly reports and other measures to 
more accurately ascertain the progress of contracted items, including 
the identification of schedule variances due to inclement weather and 
other unforeseen events and, subsequently, the development of recovery 
plans. According to DOE officials, these new reporting mechanisms 
represent a comparable alternative to an EVM system and will give DOE 
project managers additional opportunities to identify potential 
schedule slippages and enable appropriate management intervention to 
take place in a timely manner.[Footnote 19] 

Long-term Sustainability of U.S.-Funded Security Upgrades Is Uncertain 
because Access Problems and Other Issues May Hamper DOE and DOD 
Sustainability Efforts: 

DOE has developed sustainability guidelines to help Russia prepare to 
take financial responsibility for maintaining U.S.-funded security 
upgrades at nuclear material and warhead sites without DOE assistance 
by 2013 as the Congress mandated. DOE and Rosatom are developing a 
joint sustainability plan that will provide an agreed-upon framework to 
guide DOE's sustainability efforts at nuclear material sites in Russia. 
However, DOE's ability to ensure that U.S.-funded security upgrades at 
nuclear material sites are being sustained may be hampered by access 
difficulties, funding concerns, and other issues. Finally, access 
difficulties at some Russian nuclear warhead sites may also prohibit 
DOE and DOD from ensuring that U.S.-funded security upgrades are being 
properly sustained. 

DOE Issued Guidelines to Direct Its Efforts to Help Russia Prepare to 
Maintain U.S.-Funded Security Upgrades without DOE Assistance: 

In May 2004, DOE issued interim guidelines (referred to as 
Sustainability Guidelines) to direct its efforts to assist Russia in 
developing sustainable MPC&A systems at Russian nuclear material and 
warhead sites by 2013 as the Congress mandated. In December 2006, DOE 
issued a final version of its Sustainability Guidelines for the MPC&A 
program. These guidelines require DOE program managers to develop 
assessments of each site's existing capabilities to sustain MPC&A 
systems and to identify requirements that should be met before a site 
transitions from DOE support to full Russian responsibility. According 
to DOE, these assessments will be used to develop site-specific 
sustainability plans that detail the remaining cooperative activities 
required to address each of the seven elements of sustainability. The 
guidelines also require DOE project teams to develop site-specific 
transition plans, which would detail how sustainability activities will 
be funded as the sites move toward transition to full Russian 
responsibility by 2013. 

DOE's Sustainability Guidelines set forth seven key elements of a 
sustainable MPC&A program at sites receiving MPC&A upgrades, such as 
the development of site operating procedures, which form the foundation 
for all of DOE's sustainability activities at nuclear material and 
warhead sites in Russia and other countries where DOE has provided 
security upgrades. DOE uses a variety of sustainability indicators for 
each of the seven elements to determine the degree to which the 
individual elements are being addressed at Russian sites. Table 2 shows 
the seven elements of sustainability outlined in DOE's Sustainability 
Guidelines and some of the indicators DOE uses to assess the degree to 
which each element of sustainability is being met at a given Russian 
site. 

Table 3: Seven Elements of Sustainability in DOE's Guidelines: 

Element: Site MPC&A organization; 
Definition: Site MPC&A operations plans establish management 
structures, assign staff responsibilities that support MPC&A 
operations, identify how site actions reduce risk, and identify how the 
site will allocate human and financial resources to effectively operate 
the MPC&A systems; 
Select sustainability indicators: 
* Site has an established and documented MPC&A organization with clear 
roles and responsibilities; 
* Site has conducted MPC&A sustainability planning; 
* Site has a budget for MPC&A operations and personnel. 

Element: Site operating procedures; 
Definition: MPC&A systems require a set of procedures to direct site 
personnel in the proper operation of equipment. Site operating 
procedures help staff operate systems consistently and effectively in 
conformance with Russian national regulations; 
Select sustainability indicators: 
* Site has written procedures covering all key MPC&A operations; 
* Site procedures are consistent with regulations; 
* Site has a mechanism for modifying procedures. 

Element: Human resource management and site training; 
Definition: A human resource management system is designed to provide 
qualified and well-trained MPC&A professionals to perform assigned 
MPC&A duties; 
Select sustainability indicators: 
* Training requirements for each MPC&A position have been identified; 
* The site has a mechanism to track corrective actions from inspections 
and offers retraining to staff. 

Element: Operational cost analysis; 
Definition: Operational cost analysis helps sites to plan and allocate 
resources for MPC&A operations throughout the system's life cycle by 
estimating the costs associated with long-and short-term maintenance of 
MPC&A systems; 
Select sustainability indicators: 
* Site has identified life cycle costs, capital equipment replacement 
costs, etc; 
* Site has established a budget for MPC&A operation, which covers the 
site's system requirements. 

Element: Equipment maintenance, repair, and calibration; 
Definition: Preventative maintenance, repair, and equipment calibration 
should be governed by a formal maintenance and repair process to ensure 
that malfunctioning equipment is promptly repaired, spare parts are 
available, and equipment is properly calibrated; 
Select sustainability indicators: 
* Site has documented maintenance requirements, strategy, and schedule, 
prioritized based on relative importance of the components; 
* Site has adequate resources to maintain or repair MPC&A systems; 
* Site has a documented calibration plan. 

Element: Performance testing and operational monitoring; 
Definition: Performance testing and operational monitoring allows site 
MPC&A organizations to assess the effectiveness of MPC&A components and 
systems and to take corrective actions when deficiencies are 
identified; 
Select sustainability indicators: 
* Site has an internal or external review system to evaluate MPC&A 
system performance; 
* Site has evidence of identifying and correcting MPC&A deficiencies. 

Element: MPC&A system configuration management; 
Definition: MPC&A systems operate as part of the overall nuclear 
operations at a site. Configuration management systems are designed to 
ensure that changes in site operations do not compromise the 
effectiveness of the site's MPC&A systems; 
Select sustainability indicators: 
* Site has a configuration control plan or similar document; 
* Changes to configuration are reviewed by appropriate staff to verify 
that system effectiveness is not degraded. 

Source: DOE. 

[End of table] 

According to DOE, the Sustainability Guidelines provide general 
criteria for DOE project teams to follow when working with their 
Russian counterparts in developing sustainability programs for sites 
where DOE has installed MPC&A systems. DOE officials noted that some 
sites may not require assistance to address issues in each of the seven 
categories. For example, many sites that store naval nuclear fuel are 
administered by the Russian Navy, which has its own human resource 
management system and would not require DOE assistance to address the 
human resource management and site training sustainability element. 

In addition, DOE and Rosatom are currently developing a joint 
sustainability plan that is intended to govern sustainability 
activities at the sites under Rosatom's control where DOE has installed 
MPC&A systems. DOE officials told us that this joint sustainability 
plan may be completed in March 2007. DOE officials believe that this 
plan will be an important step in gaining Rosatom's buy-in to the 
concepts of sustainability and will lead to a specific path forward and 
detailed plan for funding sustainability activities for DOE, while 
transitioning to full Russian responsibility in 2013. According to DOE 
officials, the plan will be based largely on DOE's Sustainability 
Guidelines and will include the seven key elements of sustainability 
outlined in those guidelines. DOE anticipates spending about $437.8 
million to provide sustainability support to sites in Russia and other 
countries between fiscal year 2007 and fiscal year 2013. 

While DOE's Sustainability Guidelines provide a framework for the 
department's approach to sustainability implementation, the guidelines 
do not call for a tracking system to assist MPC&A management in 
assessing the progress being made toward DOE's goal of providing Russia 
a sustainable MPC&A system by 2013. Currently, DOE's Metrics 
Information Management System (MIMS) contains data detailing the 
department's progress in implementing the MPC&A program by tracking the 
number of buildings and sites where DOE has installed security 
upgrades, among other things. DOE also uses MIMS to track some measures 
of progress in their sustainability efforts, such as the development of 
site-specific plans that document how MPC&A site management will plan, 
budget, direct, monitor, and evaluate all MPC&A systems. DOE managers 
use MIMS as a tool in their oversight of the MPC&A program. However, 
DOE officials acknowledged that the current MIMS data do not provide an 
accurate picture of the department's progress toward its goal of 
preparing Russia to take full responsibility for funding the 
maintenance and sustainability of U.S.-funded upgrades by 2013. 
Expanding MIMS to include tracking for all sustainability elements 
could give DOE managers an improved tool for monitoring the MPC&A 
program's progress toward the goal of preparing Russia to take full 
responsibility for funding the maintenance and sustainability of U.S.- 
funded upgrades by 2013. Further, DOE officials told us that improved 
tracking of sustainability implementation would be useful to allow the 
department to provide more accurate information to the Congress on 
DOE's progress in its sustainability efforts. 

DOE's Ability to Ensure That U.S.-Funded Security Upgrades at Nuclear 
Material Sites Are Being Sustained May Be Hampered by Access 
Difficulties, Funding Concerns, and Other Issues: 

Several challenges could impact DOE's ability to prepare Russia to 
sustain security upgrades on its own at sites that house weapons-usable 
nuclear material, including: (1) access difficulties at some sites, (2) 
the limited financial ability of some Russian sites to maintain DOE- 
funded MPC&A equipment, (3) the lack of certification of some DOE- 
funded MPC&A equipment, and (4) delays in installing the MPC&A 
Operations Monitoring (MOM) system at Rosatom facilities. 

* According to DOE officials, Russia has denied DOE access at some 
sites after the completion of security upgrades, making it difficult 
for the department to ensure that funds intended for sustainability of 
U.S.-funded upgrades are being properly spent. For example, at one 
facility where DOE completed upgrades in 1998, DOE officials were 
denied access from 1999 through 2002. DOE officials told us that after 
commissioning the MPC&A system at this facility, the department had not 
developed specific plans for sustaining the U.S.-funded security 
equipment. Upon returning to the facility in September 2002, DOE 
officials found that the U.S.-funded security upgrades were in a severe 
state of disrepair. As a result, DOE has had to spend about $800,000 to 
correct problems resulting from the site's inability to properly 
maintain the U.S.-funded security upgrades. According to DOE officials, 
these security upgrade replacement efforts are scheduled to be 
completed in fiscal year 2007. 

* Despite improvements in the Russian economy, some sites may not be 
financially able to maintain DOE-funded security upgrades. The Russian 
economy has improved since the collapse of the Soviet Union in 1991 and 
the financial troubles of the late 1990s.[Footnote 20] In September 
2006, the Deputy Head of Rosatom stated that Russia is no longer in 
need of U.S. assistance and that it is easier and more convenient for 
Russia to pay for its own domestic nuclear security projects. However, 
during our visit to Russia, officials at three of the four civilian 
nuclear research institutes we visited told us that they are concerned 
about their sites' financial ability to maintain U.S.-funded security 
upgrades after U.S. assistance ends. Some of these sites do not receive 
regular funds from the Russian government to support the operation and 
maintenance of their MPC&A systems. As a result, Russian site officials 
told us that, after DOE financial support ends in 2013, they will 
likely face difficult choices about how to pay for maintenance of the 
security upgrades DOE has provided. 

* Some U.S.-funded MPC&A equipment is not certified for use at Russian 
facilities, which means that the Russian government may not pay for its 
maintenance. Certification is a mandatory Russian regulatory 
requirement designed to ensure the functionality, safety, and security 
of specific equipment, products, and technology used in Russian nuclear 
sites. Certification of U.S.-funded MPC&A equipment must be obtained 
before it can be legally used at Russian nuclear sites. DOE has 
historically maintained that certification is a Russian responsibility, 
and current DOE policy generally precludes funding for certification of 
equipment. Despite repeated attempts to persuade Russia to fund 
equipment certification, DOE is paying for some equipment to be 
certified on a case-by-case basis. According to DOE officials, some 
sites have equipment or MPC&A systems that are not fully certified for 
use. For example, at eight sites that house weapons-usable nuclear 
material, DOE-funded equipment used to make accurate measurements of 
the type and quantity of nuclear material stored at these sites has not 
been certified for use. Unless this equipment receives certification in 
the near future, DOE may be forced to pay for maintenance longer than 
it intends. Rosatom and DOE also have established a Joint Certification 
Working Group that is developing a joint plan to certify key equipment 
items. DOE developed the Equipment Certification and Vendor Support 
project in 1998 to provide DOE project managers with accurate 
information on the Russian certification process. DOE spent $23.6 
million on this project through the end of fiscal year 2006. 

* There have been delays installing the MOM system at some Rosatom 
facilities. In February 2001, we recommended that DOE develop a system, 
in cooperation with Russia, to monitor, on a long-term basis, the 
security systems installed at the Russian sites to ensure that they 
continue to detect, delay, and respond to attempts to steal nuclear 
material.[Footnote 21] In response to this recommendation, DOE 
developed the MOM system, consisting of off-the-shelf video cameras and 
other equipment designed to allow Russian officials to ensure that 
MPC&A systems are properly staffed, personnel are vigilant, and key 
security procedures are enforced. DOE officials told us in 2002 they 
anticipated that the MOM system would be an integral part of DOE's 
sustainability assistance to Russian sites. However, through the end of 
fiscal year 2006, only five sites with weapons-usable nuclear material 
where DOE installed security upgrades had the MOM system.[Footnote 22] 
While DOE also plans to install equipment at two additional sites in 
fiscal year 2007, none of the seven sites where DOE has installed or 
plans to install MOM systems is controlled by Rosatom. Rosatom has been 
unwilling to allow DOE to install MOM systems at sites under its 
control.[Footnote 23] Unfortunately, DOE was unable to anticipate 
Rosatom's resistance to the MOM system and, in 2002, the department pre-
purchased MOM equipment for use at Rosatom facilities. As a result, DOE 
has had to pay for storage and upkeep of 367 MOM cameras and other 
equipment since 2002. DOE officials told us that if Rosatom decides not 
to allow MOM equipment at its sites, the excess equipment may be used 
by other DOE programs, such as the Second Line of Defense program, 
which works with Russia to combat nuclear smuggling by installing 
radiation detection equipment at key border crossings. Through fiscal 
year 2006, DOE had spent a total of $20.5 million on the MOM project, 
including about $270,000 to pay for storage and upkeep of unused MOM 
equipment that has been in storage since 2002. 

Access Difficulties at Some Russian Nuclear Warhead Sites May Prohibit 
DOE and DOD from Ensuring That Security Upgrades Are Being Sustained: 

DOE and DOD plan to provide Russia with assistance to sustain security 
upgrades at nuclear warhead sites, but access difficulties may prevent 
the agencies from carrying out their plans. Specifically, neither 
department has reached an agreement with the Russian MOD on access 
procedures for sustainability visits to 44 permanent warhead storage 
sites where the agencies are installing security upgrades. Site access 
is needed to ensure that U.S. funds are being used to help Russia 
maintain security upgrades at these sites. If DOE and DOD cannot reach 
an agreement with the Russian MOD on access procedures for 
sustainability activities at these 44 sites, or develop acceptable 
alternatives to physical access, the agencies will be unable to 
determine if U.S.-funded security upgrades are being properly sustained 
and may not be able to spend funds allotted for these efforts. 

DOE and DOD have formed an informal working group to more effectively 
coordinate their efforts on sustainability of security upgrades at 
Russian nuclear warhead sites. DOE and DOD have agreed in principle 
that the seven elements of sustainability outlined in DOE's 
Sustainability Guidelines will be applied to the agencies' efforts to 
help the Russian MOD sustain security upgrades at nuclear warhead 
sites. DOE and DOD's joint plan to address sustainability at Russian 
nuclear warhead sites uses a three-phased approach, (1) addressing 
processes and procedural issues, (2) establishing regional training and 
maintenance centers, and (3) providing site-level assistance, such as 
warrantees and spare parts. 

* First, DOE is assisting the Russian MOD with the development of 
regulations, operating procedures, and an independent inspections 
process to help ensure that security systems continue to operate as 
intended. Similarly, DOD has supported the development of a personnel 
reliability program for the 12TH Main Directorate of the MOD and DOE is 
planning to support a similar program for the Russian Navy and 
Strategic Rocket Forces. 

* Second, DOE and DOD have funded the construction of regional training 
and maintenance centers. For example, DOE recently completed 
construction of the Kola Technical Center, near Murmansk, Russia, which 
serves as the centralized training and maintenance facility for all 
Russian MOD sites in the Murmansk region, both naval nuclear fuel sites 
and nuclear warhead storage sites.[Footnote 24] The Kola Technical 
Center was commissioned in fall 2005, and Russian MOD officials told us 
that the facility will help them prepare to assume full financial 
responsibility for maintenance and sustainability when U.S. assistance 
ends. 

* Finally, at the site level, once DOE and DOD come to agreement with 
the Russian MOD on verification of sustainability assistance, they will 
assist in sustaining the upgraded security systems with a focus on 
training and developing the Russian MOD's capability to maintain the 
modernized systems. Initially, DOE and DOD will rely on contractor 
support for repair of failed security systems while the Russian MOD's 
capability is being developed, gradually transitioning to full Russian 
system support. 

Although DOE and DOD are working closely to provide sustainability 
assistance at Russian nuclear warhead storage sites, differences exist 
in the length of time DOE and DOD intend to fund sustainability 
activities at these sites. Specifically, DOE intends to fund 
sustainability until 2013, while DOD plans to halt funding in 2011. 
This has the potential to cause difficulties for the Russian MOD when 
it comes to funding sustainability earlier at sites where DOD installed 
security upgrades. In addition, DOD plans no further support with 
respect to sustainability for warhead transportation upgrades it has 
provided to the Russian MOD, because, according to DOD officials, the 
Russian MOD has not requested assistance for this activity. 

Conclusions: 

DOE and DOD have made significant progress in helping Russia and other 
countries improve security at vulnerable sites housing weapons-usable 
nuclear material and nuclear warheads. Since our 2003 report, DOE has 
worked with Russia to resolve many of the access difficulties that we 
reported, especially at sites within the Rosatom weapons complex. 
However, in our view, DOE's current metric for reporting progress on 
the number of buildings secured by its MPC&A program provides the 
Congress with a potentially misleading assessment of the security at 
these facilities. Specifically, DOE should not report to the Congress 
that buildings with weapons-usable nuclear material in Russia and other 
countries are "secure" until all DOE risk reduction goals have been 
achieved, and all planned upgrades at those buildings are completed. 
Currently, DOE considers buildings to be "secured" after only limited 
MPC&A upgrades (rapid upgrades) are installed, even when additional 
comprehensive upgrades are planned. Rapid upgrades do not include the 
majority of measures DOE uses to address the threat of insider theft at 
Russian nuclear sites, which DOE considers to be one of its most 
pressing concerns. DOE provides most upgrades designed to address the 
insider threat during the comprehensive upgrades phase. Further, DOE 
officials told us that comprehensive upgrades are necessary to achieve 
all risk reduction goals at buildings with nuclear material, calling 
into question DOE's decision to report buildings without such upgrades 
completed as "secure." 

As DOE nears the completion of its security upgrade work in its MPC&A 
program, the sustainability of U.S.-funded nuclear security upgrades in 
Russia and other countries has become increasingly important for 
ensuring that the substantial investment of U.S. funds over the past 15 
years is not wasted. DOE and Rosatom have been cooperating to develop a 
joint sustainability plan for the majority of sites where DOE has 
installed MPC&A upgrades. We believe this is a critical step in gaining 
agreement on what remains to be done before DOE transfers full 
responsibility for sustainability of MPC&A upgrades to Russia in 2013. 
While DOE uses its Metrics Information Management System to track some 
measures of progress in its sustainability efforts, DOE officials 
acknowledged that the current MIMS data do not provide an accurate 
picture of the department's progress toward its goal of preparing 
Russia to take full responsibility for funding the maintenance and 
sustainability of U.S.-funded upgrades by 2013. Creating a new 
management information system for sustainability or expanding MIMS to 
include tracking for all sustainability elements could give DOE 
managers an improved tool for monitoring the MPC&A program's progress 
on sustainability and would aid the department in providing the 
Congress with a more accurate assessment of the progress made toward 
DOE's goal of providing Russia with a sustainable MPC&A system by 2013. 

Recommendations for Executive Action: 

To increase the effectiveness of U.S. efforts to secure nuclear 
material and warheads in Russia and other countries, we recommend that 
the Secretary of Energy, working with the Administrator of NNSA, take 
the following two actions: 

* revise the metrics used to measure progress in the MPC&A program to 
better reflect the level of completion of security upgrades at 
buildings reported as "secure;" and: 

* develop a sustainability management system or modify the Metrics 
Information Management System to more clearly track DOE's progress in 
developing a sustainable MPC&A system across all sites where it has 
installed MPC&A upgrades, including evaluations of progress for each of 
the seven key elements of sustainability outlined in DOE's 
Sustainability Guidelines. 

Agency Comments and Our Evaluation: 

DOE generally agreed with our findings and recommendations. DOD had no 
written comments on our report. DOE and DOD also provided technical 
comments, which we incorporated, as appropriate. 

In its comments, DOE provided additional information about the metric 
it uses to track progress in the MPC&A program, its reasons for not 
using EVM on fixed-price contracts, and on its efforts to work with 
Rosatom on sustainability issues. DOE agreed that the current metric it 
uses to track progress in the MPC&A program may be confusing. DOE wrote 
that it is changing the metric to one that more accurately identifies 
the level of completion for upgrades. Similarly, DOE officials told us 
in January 2007 that they were taking steps to modify the progress 
metric. However, in February 2007, DOE issued its Fiscal Year 2008 
Budget Request, which did not include modifications to clarify the 
confusions DOE agrees are present in its progress metric. As a result, 
DOE's most recent budget justification continues to present the 
Congress with an unclear picture of the progress made in improving 
security at buildings with weapons-useable nuclear material in Russia 
and other countries because DOE's progress metric does not recognize 
that additional upgrades remain to be completed at some buildings that 
the department lists as being "secure." 

As agreed with your offices, unless you publicly announce the contents 
of this report earlier, we plan no further distribution until 30 days 
from the report date. At that time, we will send copies of this report 
to the Secretaries of Energy and Defense; the Administrator, National 
Nuclear Security Administration; the Director, Office of Management and 
Budget; and interested congressional committees. We also will make 
copies available to others upon request. In addition, this report will 
be made available at no charge on the GAO Web site at [Hyperlink, 
http://www.gao.gov]. 

If you or your staff have any questions about this report, please 
contact me at (202) 512-3841 or a [Hyperlink, aloisee@gao.gov] 
loisee@gao.gov. Contact points for our Offices of Congressional 
Relations and Public Affairs may be found on the last page of this 
report. The GAO contact and staff acknowledgments are listed in 
appendix VI. 

Signed by: 

Gene Aloise: 
Director, Natural Resources and Environment: 

[End of section] 

Appendix I: Scope and Methodology: 

We performed our review of U.S. efforts to assist Russia and other 
countries in securing nuclear materials and warheads at the Departments 
of Energy (DOE), Defense (DOD) and State (State); the National Nuclear 
Security Administration (NNSA) in Washington, D.C; the Defense Threat 
Reduction Agency in Fort Belvior, Virginia; Oak Ridge National 
Laboratory in Oak Ridge, Tennessee; Los Alamos National Laboratory in 
Los Alamos, New Mexico; and Sandia National Laboratories in 
Albuquerque, New Mexico. We visited Russia to discuss the 
implementation of U.S. nuclear material and warhead security assistance 
programs with Russian officials. We also spoke with officials from the 
U.S. embassy in Moscow, DOE's Moscow office, and the DOD's Defense 
Threat Reduction Office in Moscow. 

While in Russia we met with officials from the Federal Agency for 
Atomic Energy of the Russian Federation (Rosatom), Rostekhnadzor (the 
Russian nuclear regulatory authority), and the Ministry of Defense 
(MOD)--including representatives from the 12TH Main Directorate, Navy, 
and Strategic Rocket Forces. We requested visits to the Institute of 
Nuclear Materials, Institute of Physics and Power Engineering, 
Interdepartmental Special Training Center, Russian Methodological 
Training Center, and All-Russian Scientific Research Institute of 
Technical Physics (also known as Chelyabinsk-70 and Snezhinsk), but 
Rosatom denied us access to all facilities under its control, including 
these. In fact, we were denied access to some Russian sites GAO 
officials had visited during past reviews of U.S. nonproliferation 
programs. Rosatom officials told us that because our names were not on 
the list of 185 individuals provided by DOE for access under the terms 
of a 2001 access arrangement, we would not be allowed to visit any 
Rosatom facilities. Rosatom officials did not deny our request for 
access until we had already arrived in Russia to begin our fieldwork 
for this review. In addition, the Russian MOD denied our request to 
visit a naval nuclear fuel facility, Site 49, and a naval nuclear 
warhead facility near Murmansk, Russia, due to military exercises 
scheduled near these sites during the time of our visit. 

We were able meet our audit objectives by visiting four sites-- 
civilian, educational, and research institutes that are not under 
Rosatom's control--where DOE had provided security upgrades through 
NNSA's Materials Protection, Control, and Accounting (MPC&A) program: 
Karpov Institute for Physical Chemistry, Kurchatov Institute, Joint 
Institute for Nuclear Research, and Moscow State Engineering and 
Physics Institute. During our visits to these sites, we discussed the 
implementation of the MPC&A program, sustainability of U.S.-funded 
MPC&A upgrades, and the future of DOE cooperation with Russian 
officials. In addition, we visited a training facility near Murmansk, 
Russia, built with DOE funds to provide training to Russian MOD 
personnel in the Murmansk region. 

To assess the progress DOE has made in helping Russia and other 
countries secure nuclear material, we had discussions with officials 
from NNSA's MPC&A program, DOE's contractors at Oak Ridge, Los Alamos, 
and Sandia National Laboratories, and experts from nongovernmental 
organizations that specialize in nuclear nonproliferation. We reviewed 
various program documents, including the MPC&A Programmatic Guidelines, 
MPC&A Program Management Document, project work plans, and the DOE- 
Rosatom Joint Action Plan. We also analyzed financial information 
detailing program expenditures, projected costs and schedule estimates, 
and contract data for expenditures of the MPC&A program through the end 
of fiscal year 2006. To assess the reliability of these data, we 
questioned key database officials about data entry access, internal 
control procedures, and the accuracy and completeness of the data, 
following up with further questions, as necessary. Although any caveats 
and limitations to the data were noted in the documentation of our 
work, we determined that the data we received were sufficiently 
reliable for the purposes of this report. 

To assess the progress DOE and DOD have made in assisting Russia with 
securing nuclear warheads, we reviewed documents and had discussions 
with officials from NNSA's MPC&A program, DOE's contractors at Oak 
Ridge and Sandia National Laboratories, DOD's Office of the 
Undersecretary of Defense for Policy, and the Defense Threat Reduction 
Agency. We spoke with officials from the Russian MOD and visited a 
training facility near Murmansk, Russia, built with DOE funds to 
provide training to Russian MOD personnel. We analyzed financial 
information detailing program expenditures, projected costs and 
schedule estimates, and contract data from both DOE and DOD through the 
end of fiscal year 2006. To assess the reliability of these data, we 
questioned key database officials about on data entry access, internal 
control procedures, and the accuracy and completeness of the data, 
following up with further questions, as necessary. Although any caveats 
and limitations to the data were noted in the documentation of our 
work, we determined that these data were also sufficiently reliable for 
the purposes of this report. 

In addition, we reviewed guidance on government contracting, including 
the Office of Management and Budget (OMB) Circular No. A-11, DOD Earned 
Value Management (EVM) Implementation Guide, and DOE Order 
413.3A.[Footnote 25] After reviewing this guidance, we requested copies 
of DOE and DOD's ongoing contracts valued over $20 million for work to 
help Russia and other countries secure nuclear material and warheads. 
To determine how DOE's large contracts were being managed, we reviewed 
contract documents and identified a requirement for quarterly reporting 
in the contracts. We contacted the Contracting Officers identified in 
the contracts to request information on how the contracts are managed 
in respect to applicable criteria required by OMB and DOE directives. 
Additionally, we reviewed DOD's large contracts for installing security 
upgrades at Russian nuclear warhead sites and reviewed documentation 
from DOD's contractors, Bechtel National, Inc., and Raytheon Technical 
Services. After analyzing these contracts and other related 
documentation, we determined that both of DOD's contracts reflected an 
EVM system. DOD provided us with certification documentation for 
Bechtel and Raytheon's EVM systems, a requirement called for by federal 
guidance for all EVM systems. Since the scope of work within the 
Bechtel contract was at or near completion, we evaluated only the 
contract performance management for Raytheon, in order to determine how 
DOD was executing and managing its large contracts for security 
upgrades at Russian warhead sites. DOD provided Raytheon's cost 
performance reports which GAO contracting experts assessed for cost and 
schedule variances in contracted work. After review of Raytheon's cost 
performance reports, we determined that shortfalls in scheduled work 
were resulting in a schedule variance equivalent to around $13 
million.[Footnote 26] 

To assess the efforts undertaken by DOE and DOD to ensure the 
sustainability and continued use of U.S.-funded security upgrades, we 
had discussions with officials from NNSA's MPC&A program; DOE's 
contractors at Oak Ridge, Los Alamos, and Sandia National Laboratories; 
DOD's Office of the Undersecretary of Defense for Policy; and the 
Defense Threat Reduction Agency. We analyzed program documents, 
including DOE's May 2004 interim Sustainability Guidelines, DOE's 
December 2006 final Sustainability Guidelines, DOE-DOD Joint 
Sustainability Task Force documents, DOE-Rosatom Joint Sustainability 
Working Group documents, and project work plans. We interviewed program 
officials responsible for the development of DOE's Sustainability 
Guidelines and program managers responsible for implementing them. We 
also discussed the sustainability of U.S.-funded upgrades with Russian 
officials at sites we visited. 

We performed our review from April 2006 to February 2007 in accordance 
with generally accepted government auditing standards. 

[End of section] 

Appendix II: Time Line of Major Events in the History of U.S. Efforts 
to Secure Nuclear Material and Warheads in Russia and Other Countries: 

[See PDF for image] - graphic text: 

Source: GAO. 

[End of figure] - graphic text: 

[End of section] 

Appendix III: Additional Information on DOE Efforts to Secure Sites 
with Weapons-Usable Nuclear Material in Countries Other Than Russia: 

From fiscal year 1993 through fiscal year 2006, DOE spent a total of 
$131.5 million on efforts to help countries outside of Russia secure 
facilities with nuclear material (see fig. 4). Responsibility for 
managing DOE's MPC&A efforts in countries outside of Russia has shifted 
among a number of offices within DOE and NNSA.[Footnote 27] 
Responsibility for sustainability of upgrades at sites in the former 
Soviet Union now rests with the Office of Weapons Material Protection 
within the Office of International Materials Protection and Cooperation 
in NNSA. The Office of Materials Consolidation and Civilian Sites 
within the Office of International Materials Protection and Cooperation 
in NNSA is responsible for implementing MPC&A efforts outside of the 
former Soviet Union, such as DOE's efforts in China and India. 

Figure 4: Map Showing DOE Spending by Country through the End of Fiscal 
Year 2006 for MPC&A Assistance Outside of Russia: 

[See PDF for image] - graphic text: 

Sources: GAO analysis of DOE data and map Resources (map). 

Note: In addition to the spending illustrated in the above figure, DOE 
also spent $33.7 million on miscellaneous MPC&A efforts outside of 
Russia through the end of fiscal year 2006. Also, all dollar amounts 
are rounded, and dollars are in millions. 

[End of figure] - graphic text: 

Belarus: 

DOE provided security upgrades to two buildings at one facility--the 
Sosny Scientific and Technical Center (now known as the Joint Institute 
of Power and Nuclear Research-Sosny)--in Belarus. DOE began work at 
this site in April 1994, and the initial phase of MPC&A upgrades was 
completed in December 1997. After this, DOE was unable to conduct 
additional work in the country due to sanctions the United States had 
placed on Belarus.[Footnote 28] However, in May 2003, the Department of 
State modified its position and allowed a team from DOE to visit Sosny 
solely to review the status of the MPC&A systems provided with U.S. 
funds. The DOE team visited the site in June 2003 and noted several 
security deficiencies that required immediate improvement. Shortly 
thereafter, DOE received approval from the Department of State to 
return to Belarus to perform a comprehensive vulnerability assessment 
at the Sosny site. According to DOE officials, the Department of 
State's Nonproliferation and Disarmament Fund allocated $250,000 for 
design work and $1.6 million for further upgrades in 2003 and 2005, 
respectively. Since there is currently no government-to-government 
agreement between the United States and Belarus, the project is being 
administered via the International Scientific and Technical Center's 
Partners Program. However, no funding has been spent yet because the 
Belarusian government suspended the project due to concerns over 
sharing information with a foreign entity. In the fall of 2006, Belarus 
indicated that it was again ready to move forward with the project. DOE 
sent a team to Sosny in December 2006 and was able to re-establish 
relations, as well as, develop a statement of work for the design of a 
communications system for the site and a project work plan for material 
control and accounting. Additional trips are planned for February and 
April 2007. DOE hopes to complete a second phase of MPC&A upgrades at 
the site in fiscal year 2008. In total, DOE spent about $3.6 million 
through the end of fiscal year 2006 to provide MPC&A assistance to 
Belarus. 

China: 

DOE has a cooperative engagement program with China on issues related 
to nuclear material security. The purpose of the engagement is to 
increase awareness of our respective approaches to nuclear security 
issues, as well as MPC&A methodologies and applicable technologies, and 
to work cooperatively to improve security in these areas when and where 
appropriate. DOE is pursuing this objective through dialogue and 
technical collaboration with the China Atomic Energy Authority in 
China's civilian nuclear sector and is attempting initial engagements 
with the China Academy of Engineering Physics in China's defense 
nuclear sector. 

DOE is pursuing bilateral cooperation with the Chinese civilian nuclear 
sector under the Statement of Intent signed with the China Atomic 
Energy Authority in January 2004 and the DOE-China Atomic Energy 
Authority Peaceful Uses of Nuclear Technology Agreement. In February 
2004, DOE and the China Atomic Energy Authority agreed to conduct a 
Joint Technology Demonstration on integrated nuclear material 
management in Beijing. The purpose of this demonstration project was to 
promote the adoption of modern security practices and technologies at 
civilian nuclear facilities by demonstrating established physical 
protection, nuclear material control and accounting, and international 
safeguards technologies that provide a first line of defense against 
nuclear material theft, diversion, and sabotage. The Joint Technology 
Demonstration took place in Beijing in October 2005. Following the 
completion of the technology demonstration project, DOE is currently 
discussing ideas for future bilateral work with the China Atomic Energy 
Authority and the Chinese Institute of Atomic Energy. Through fiscal 
year 2006, DOE had spent about $4.7 million on MPC&A cooperation with 
China. 

Georgia: 

DOE provided security upgrades at one facility in Georgia, the 
Andronikashvili Institute of Nuclear Physics in Tbilisi. Work began at 
this site in January 1996 and was completed in May 1996, at a cost of 
about $0.2 million. All fresh and spent nuclear fuel was transferred 
from the facility to a secure nuclear site in Scotland in April 1998 
under a multinational effort known as Operation Auburn Endeavor. DOE's 
MPC&A program currently has no ongoing work in Georgia. 

India: 

DOE's cooperative security engagement program with India is in its 
initial stages. DOE is investigating near-term opportunities to engage 
India on issues related to nuclear material security with the intent of 
initiating a cooperative program with India on nuclear security best 
practices. Potential issues for discussion include the theoretical 
framework for developing and implementing a design basis threat; the 
methodology for designing effective physical protection systems; a 
vulnerability assessment methodology; regulatory infrastructure for 
material control and accounting, and physical protection; and general 
nuclear security culture. DOE spent about $100,000 on MPC&A cooperation 
with India through the end of fiscal year 2006. 

Latvia: 

DOE provided security upgrades at one facility in Latvia, the Latvian 
Academy of Sciences Nuclear Research Center (also known as the Latvian 
Institute of Nuclear Physics at Salaspils). Work began at this site in 
July 1994 and was completed in February 1996. Since fiscal year 1994, 
DOE has spent about $900,000 to install and maintain security upgrades 
at this facility. In May 2005, 2.5 kilograms of fresh highly enriched 
uranium (HEU) fuel were removed from the Salaspils reactor and returned 
to Russia. According to the Federal Agency for Atomic Energy of the 
Russian Federation (Rosatom), the HEU fuel will be downblended into low-
enriched uranium nuclear fuel for use in civilian nuclear power plants. 
DOE's MPC&A program currently has no ongoing work in Latvia. 

Lithuania: 

DOE provided security upgrades at one facility in Lithuania, the 
Ignalina Nuclear Power Plant. Work began at this site in October 1995 
and was completed in August 1996. Since fiscal year 1996, DOE has spent 
about $900,000 to install and maintain security upgrades at this 
facility. DOE counted one building at this facility as secure in its 
progress metric for the MPC&A program that tracks the number of 
buildings with weapons-usable nuclear material secured, even though the 
facility never possessed such material.[Footnote 29] During the course 
of our review, we brought this to the attention of DOE management, and 
they agreed to remove the facility from the progress report in DOE's 
fiscal year 2008 budget justification document. DOE's MPC&A program 
currently has no ongoing work in Lithuania. 

Kazakhstan: 

DOE provided security upgrades to four sites in Kazakhstan: the 
Institute of Atomic Energy-Kurchatov, the Institute of Nuclear Physics 
at Alatau, the BN-350 breeder reactor at Aktau, and the Ulba 
Metallurgical Plant. In total, DOE spent about $45.3 million from 
fiscal year 1994 through fiscal year 2006 to provide MPC&A assistance 
to Kazakhstan. 

Institute of Atomic Energy-Kurchatov: 

The Institute of Atomic Energy-Kurchatov, formerly called Semipalatinsk-
21, is a branch of the Kazakhstan National Nuclear Center. Two nuclear 
research reactors are located at the site. DOE began providing both 
physical security and material control and accounting upgrades to the 
site in October 1994, and the site was commissioned in September 1997. 
The perimeter security system at the site was commissioned in July 
1998. DOE plans to continue to assist the Institute of Atomic Energy-
Kurchatov with spare parts, extended warranties, and training to 
sustain its MPC&A systems in fiscal year 2007. 

Institute of Nuclear Physics: 

The Institute of Nuclear Physics is a branch of the Kazakhstan National 
Nuclear Center located in the town of Alatau. The site operates a 10- 
megawatt research reactor used to manufacture radioisotopes as a 
radiation source for industrial and medical use, among other 
activities. DOE began work at the site in September 1995 and completed 
upgrades in October 1998. DOE plans to continue to assist the Institute 
of Nuclear Physics at Alatau with extended warranties and training to 
sustain its MPC&A systems in fiscal year 2007. 

BN-350 Reactor at Aktau: 

DOE provided upgrades to two buildings at the BN-350 reactor site at 
Aktau. MPC&A upgrade work began in September 1994 and was completed in 
December 1998. In May 2002, HEU fuel was transferred from the BN-350 
breeder reactor in Aktau to the Ulba Metallurgical Plant with the 
assistance of a nongovernmental organization involved in 
nonproliferation efforts--the Nuclear Threat Initiative. The HEU fuel 
will be downblended into low-enriched uranium nuclear fuel for use in 
civilian nuclear reactors. 

Ulba Metallurgical Plant: 

The Ulba Metallurgical Plant contains a low-enriched uranium fuel 
fabrication facility, among other resources. The fuel fabrication 
facility produces nuclear fuel pellets with a capacity of 1,000 metric 
tons per year. Security upgrades work began in September 1994 and was 
completed in September 1997. DOE plans to continue to assist the Ulba 
Metallurgical Plant with extended warranties and spare parts to sustain 
its MPC&A systems in fiscal year 2007. 

In addition, on November 21, 1994, 581 kilograms of HEU was transferred 
from the Ulba Metallurgical Plant to the United States in a highly 
secret project code-named "Sapphire." The project was carried out with 
cooperation from the Kazakhstani government and DOE and DOD.[Footnote 
30] The large stockpile of HEU, reportedly left over from the Soviet 
Union's secret Alfa submarine program, had been stored at the Ulba 
Metallurgical Plant in unsecured and unsafeguarded facilities without 
electronic means of accounting. Experts estimate the nuclear material 
was sufficient to make 20-25 nuclear bombs. The HEU was downblended 
into low-enriched uranium for use in civilian nuclear power plants in 
the late 1990s. 

Ukraine: 

DOE provided MPC&A assistance to four sites in Ukraine: Kharkiv 
Institute of Physics and Technology, Kiev Institute of Nuclear 
Research, Sevastopol National Institute of Nuclear Energy and Industry, 
and South Ukraine Nuclear Power Plant. In total, DOE spent about $37.7 
million from fiscal year 1993 through fiscal year 2006 to provide MPC&A 
assistance to Ukraine, including installation of security upgrades, 
maintenance of installed MPC&A systems, and training for site 
personnel. 

Kharkiv Institute of Physics and Technology: 

The Kharkiv Institute of Physics and Technology conducts nuclear fuel 
cycle research and has important experimental physics facilities 
including a number of electron and ion accelerators. DOE provided 
upgrades to one building at this site. Security upgrades work began in 
May 1995 and was completed in January 1999. DOE plans to continue to 
assist the Kharkiv Institute of Physics and Technology with extended 
warranties and training to sustain its MPC&A systems in fiscal year 
2007. 

Kiev Institute of Nuclear Research: 

The Kiev Institute of Nuclear Research was established in 1970 and is 
operated by the Ukrainian Academy of Sciences. The institute's primary 
function is to perform research in low-and medium-energy nuclear 
physics. Security upgrades work began at one building at this site in 
December 1993 and was completed in October 1997. DOE plans to continue 
to assist the Kiev Institute of Nuclear Research with extended 
warranties and training to sustain its MPC&A systems in fiscal year 
2007. 

Sevastopol National Institute of Nuclear Energy and Industry: 

The Sevastopol National Institute of Nuclear Energy and Industry's 
mission is to support Ukraine's nuclear power industry by training 
nuclear power plant personnel. The facility operates a 200-kilowatt, 
light-water cooled, research reactor. Security upgrades work began at 
one building at this facility in May 1996 and was completed in January 
1999. DOE plans to continue to assist the Sevastopol National Institute 
of Nuclear Energy and Industry with extended warranties and training to 
sustain its MPC&A systems in fiscal year 2007. 

South Ukraine Nuclear Power Plant: 

In addition to these facilities, DOE provided MPC&A upgrades to a 
fourth site that does not possess weapons-usable nuclear material, the 
South Ukraine Nuclear Power Plant. DOE began security upgrades work at 
this site in August 1994 and completed its upgrades work in January 
1999. DOE counted this facility as secured in its progress metric for 
the MPC&A program, even though the facility never possessed such 
material. During the course of our review, we brought this to the 
attention of DOE management, and they agreed to remove the facility 
from their progress report in DOE's fiscal year 2008 budget 
justification document. According to DOE officials, no further MPC&A 
assistance is planned at this site. 

Uzbekistan: 

In Uzbekistan, DOE's project goal is to continue to enhance 
capabilities and commitment to operating and maintaining security 
improvements at two institutes: the Institute of Nuclear Physics in 
Tashkent and the Foton facility. In total, DOE spent about $4.4 million 
from fiscal year 1995 through fiscal year 2006 to provide MPC&A 
assistance to Uzbekistan. 

Institute of Nuclear Physics: 

Founded in 1956 as part of the Uzbekistan Academy of Sciences, the 
Institute of Nuclear Physics operates a 10-megawatt research reactor. 
Often described as the largest facility of its kind in central Asia, 
the site has an ambitious program to become the primary nuclear 
research and isotope production facility for the region. The facility 
maintains fresh and irradiated nuclear fuel storage facilities to 
support continued reactor operations. Security upgrades at the site 
began in June 1995 and were provided by a joint team from the United 
States, Australia, Sweden, and the United Kingdom. Australia and Sweden 
agreed to provide assistance in the area of material control and 
accounting, while the United States and United Kingdom agreed to 
provide physical protection upgrades. Upgrades were provided in two 
phases. Phase I upgrades were completed in August 1996. After the 
attacks of September 11, 2001, DOE began to work with the facility to 
develop a plan to further improve its security system. Additional 
upgrades focused on the facility perimeter and included the 
installation of new fencing and exterior intrusion detection sensors. 
In addition, the Department of State provided about $0.6 million in 
fiscal year 2002 through its Nonproliferation and Disarmament Fund to 
supply cameras and lighting for the facility's perimeter. All Phase II 
upgrades were completed in September 2002. A commissioning ceremony was 
held in October 2002. In 2006, DOE announced the removal of 63 
kilograms of HEU in the form of spent nuclear fuel from the facility. 
The HEU spent fuel was returned to Russia through DOE's Global Threat 
Reduction Initiative. DOE plans to continue to assist the Institute of 
Nuclear Physics with extended warranties and training to sustain its 
MPC&A systems in fiscal year 2007. 

Foton Facility: 

The Foton facility has a small research reactor containing less than 5 
kilograms of HEU. MPC&A upgrades at the site began in January 2005 and 
were completed in May 2005. Physical security upgrades at the Foton 
facility focused on the research reactor building and included such 
things as intrusion detection sensors, improved access controls, and a 
central alarm station. DOE plans to continue to assist the Foton 
facility with extended warranties to sustain its MPC&A systems in 
fiscal year 2007. 

[End of section] 

Appendix IV: Additional Information on DOE's National Infrastructure 
and Related Programs: 

In addition to DOE's efforts to provide security upgrades at sites with 
weapons-usable nuclear material and warheads in Russia and other 
countries, the department implements other crosscutting efforts to 
support the efforts of its MPC&A program, such as assistance for 
transportation security, equipment for protective forces at nuclear 
facilities, and efforts to consolidate nuclear material into fewer 
buildings and sites. According to DOE officials, these efforts support 
DOE's goal of improving security of vulnerable stockpiles of weapons- 
usable nuclear material by contributing to the overall security systems 
at nuclear materials sites in Russia and other countries. As table 4 
shows, through the end of fiscal year 2006, DOE spent about $493.9 
million on these efforts. 

Table 4: DOE Spending on Crosscutting MPC&A Assistance Efforts through 
the End of Fiscal Year 2006: 

Dollars in millions. 

Material consolidation and conversion; 
Spending: $128.8. 

Secure transportation; 
Spending: 88.1. 

Training and technical support infrastructure; 
Spending: 63.6. 

Russian Federation inspection implementation; 
Spending: 43.1. 

Protective forces assistance; 
Spending: 30.2. 

Federal Information System; 
Spending: 29.1. 

Regulatory development; 
Spending: 27.0. 

Certification[A]; 
Spending: 23.6. 

MPC&A operations monitoring[A]; 
Spending: 20.5. 

MPC&A operations/sustainability[A]; 
Spending: 13.9. 

MPC&A education; 
Spending: 13.4. 

Material control and accounting measurements; 
Spending: 10.8. 

MPC&A security culture; 
Spending: 1.3. 

Taxation and customs; 
Spending: 0.5. 

Total; 
Spending: $493.9. 

Source: GAO analysis of DOE data. 

[A] The certification, MPC&A operations monitoring, and MPC&A 
operations/sustainability projects are discussed in the body of this 
report. Dollar amounts are rounded. 

[End of table] 

Material Consolidation and Conversion: 

DOE's Material Consolidation and Conversion project supports the 
transfer of HEU from Russian sites where it is no longer needed in 
order to secure locations within Russia for eventual conversion to low- 
enriched uranium. According to DOE, consolidation and conversion 
efforts significantly reduce the requirements and costs of securing 
material. For example, in 2006, DOE announced the completion of a 2- 
year cooperative effort to remove HEU from the Krylov Shipbuilding 
Research Institute, a Russian research facility located near St. 
Petersburg. DOE teams worked with their Russian counterparts to 
validate the inventory of nuclear material and confirm that it was 
securely packaged for transport. DOE paid for the HEU to be shipped to 
another facility in Russia where it will be converted (downblended) to 
low-enriched uranium, which will eliminate it as a proliferation 
concern. Through the Material Consolidation and Conversion project, DOE 
has also supported the secure storage and conversion of Russian-origin 
HEU that has been returned to Russia from countries such as Bulgaria, 
the Czech Republic, Latvia, Serbia, and Uzbekistan. DOE reported in 
July 2006 that more than 8,000 kilograms of HEU had been downblended 
into low-enriched uranium under the project. Through the end of fiscal 
year 2006, DOE had spent about $128.8 million on the project. 

Secure Transportation: 

In the aftermath of the September 11, 2001, terrorist attacks, DOE 
increased funding for its efforts to secure nuclear material during 
transit. By providing upgraded security for transport and guard 
railcars, specialized secure trucks and escort vehicles, and secure 
containers--called overpacks--DOE seeks to reduce the risks of theft 
and sabotage of nuclear material transported within and between nuclear 
facilities in Russia. The goal of the Secure Transportation project is 
to reduce the risk of theft or diversion of material or warheads during 
transportation operations in Russia by improving security for railcars 
and trucks, Russian nuclear material and warhead transport 
infrastructure, and communications interface with response forces. 
Through fiscal year 2006, DOE had spent about $88.1 million to improve 
the transportation security of nuclear material in Russia, by providing 
76 cargo trucks, 86 escort vehicles, as well as 66 cargo railcars, 25 
guard railcars, and 283 security overpacks. This included 54 
refurbished cargo railcars, 25 new manufactured guard railcars, 12 new 
manufactured cargo railcars, and approximately 78 cargo trucks and 89 
escort trucks to support both on-site and off-site nuclear material 
shipments. 

Training and Technical Support Infrastructure: 

DOE provides a variety of training and technical support to both the 
Russian Navy and Rosatom to help these entities operate and maintain 
U.S.-funded security upgrades and MPC&A systems. One of the primary 
accomplishments of the project was the construction of the Kola 
Technical Center near Murmansk. The facility was designed and 
constructed by DOE to be a central training and maintenance center to 
support naval nuclear fuel and warhead sites in the Murmansk region. 
DOE completed construction of the Kola Technical Center in June 2005 at 
a cost of $24 million.[Footnote 31] We visited the facility during our 
trip to Russia. Russian officials told us that the Kola Technical 
Center is critical to help the Russian MOD transition to full financial 
responsibility for sustainability after U.S. funding ends. 

In addition, DOE provides support to Rosatom's regional training 
facilities through the Rosatom Training and Technical Support 
Infrastructure project. These facilities, such as the Interdepartmental 
Special Training Center and the Russian Methodological and Training 
Center, seek to train specialists and guard forces to safeguard 
materials at Russian nuclear sites. Additionally, these centers seek to 
assist Rosatom by providing effective and sustainable training and 
technical support infrastructures. To date, DOE has spent $42.5 million 
on the establishment of these training and technological support 
centers. 

Russian Federation Inspection Implementation: 

The Russian Federation Inspection Implementation project seeks to 
enhance nuclear material inspections by establishing a sustainable 
infrastructure with sufficient resources to enforce MPC&A regulations 
through federal and industry oversight. Under this project, DOE 
provides inspection support to Rostekhnadzor, Rosatom, and other 
Russian ministries and agencies. The project enhances MPC&A nuclear 
material inspections at the ministerial, agency, and site-level by 
providing comprehensive training, inspection, and technical assistance, 
as well as sufficient information technology to aid inspectors in 
conducting systematic inspections. For example, DOE assists Russian 
organizations in developing a systematic inspection approach that 
assures the MPC&A objectives are met and assists organizations in 
defining the inspection program by benchmarking proposed inspection 
methodologies against U.S. and other inspection approaches. Through 
fiscal year 2006, DOE has sponsored 83 inspections by Rosatom and 
Rostekhnadzor, and 980 Russian personnel have attended inspection 
courses. DOE's goal for the project is to maintain a cadre of about 125 
trained inspectors. DOE had spent about $43.1 million on this project 
through the end of fiscal year 2006. 

Protective Forces Assistance: 

The objective of the Protective Force Assistance project is to ensure 
that a sufficient number of organized, equipped, and trained response 
forces are present and able to protect against threats to highly- 
desirable nuclear material at Russian and Ukrainian sites and during 
transit. The project includes efforts in Russia and Ukraine, although 
the bulk of the efforts and money are spent in Russia. As of fiscal 
year 2006, DOE spent about $26.7 million to purchase a variety of 
equipment, such as bulletproof vests, helmets, response vehicles, and 
cold-weather uniforms for use by the forces that protect sites that 
store weapons-usable nuclear material in Russia. As of fiscal year 
2006, DOE spent about $3.4 million to purchase the same type of 
equipment for Ukrainian sites. 

Federal Information System: 

The Federal Information System (FIS) is a computerized management 
information system designed to track the location and movement of 
nuclear material between organizations throughout Russia. The FIS 
provides information on the quantity of nuclear material located at 
facilities that report to Rosatom. The system is centralized and 
automated to ensure that information can be received, tracked, and 
monitored by Rosatom. The development of the FIS is important to the 
MPC&A program because, prior to its development, Russian nuclear 
facilities generally used paper-based systems to track nuclear material 
inventories. The FIS will allow the Russian government to maintain an 
accurate and complete inventory of its weapons-usable nuclear material. 
As of fiscal year 2006, DOE reported that 21 organizations and 
facilities throughout Russia report to the FIS. Through the end of 
fiscal year 2006, DOE had spent about $29.1 million to develop the FIS. 

Regulatory Development: 

The purpose of the Regulatory Development project is to assist Russian 
regulatory and operating agencies and services in developing a 
sustainable MPC&A regulatory system for civilian nuclear materials site 
security and to also provide assistance to regulatory agencies in 
Ukraine and Kazakhstan. The regulatory framework establishes legal 
requirements for MPC&A activities for relevant ministries, agencies, 
services, operating organizations, and facilities. DOE works with 
Rosatom, Rostekhnadzor--Russia's civilian nuclear regulatory authority, 
and other agencies to develop consistent MPC&A requirements across 
ministries, operating organizations, and facilities. In doing so, DOE 
aims to create incentives for effective MPC&A procedures and sanctions 
for noncompliance with regulations in order to foster a strong MPC&A 
culture and help sustain U.S.-funded security upgrades. Through the end 
of fiscal year 2006, the project has achieved enactment of 67 
regulations, which is 35 percent of the total planned. In addition, DOE 
has worked with the Russian MOD to develop a comprehensive regulatory 
base that ensures MPC&A practices are implemented consistently 
throughout all branches and services of the Russian MOD. DOE spent 
about $27 million through fiscal year 2006 on its regulatory 
development projects. 

MPC&A Education: 

The MPC&A Education project supports efforts in Russia to train 
existing and future MPC&A experts. The project consists of two 
educational degree programs at the Moscow Engineering Physics Institute 
and one degree program at Tomsk Polytechnic University. The first 
educational degree program is the MPC&A Graduate Program available only 
at the Moscow Engineering Physics Institute. DOE worked with both the 
Moscow Engineering Physics Institute and Tomsk Polytechnic University 
to develop an undergraduate engineering program, focusing on more 
technical, hands-on aspects of nuclear security. For each of these 
degree programs, DOE works with the two universities to develop 
curriculum; identify and acquire training aids; develop and publish 
textbooks; and strengthen instructor skills. In addition, DOE works 
with the Monterey Institute of International Studies[Footnote 32] to 
support the instruction of nontechnical nonproliferation courses at 
universities and high schools located outside of Moscow. Through the 
end of fiscal year 2006, DOE had spent about $13.4 million on the 
project. 

Material Control and Accounting Measurements: 

The Material Control and Accounting Measurements project provides 
support to Russia for developing a national system of reference 
materials (standards), nuclear material measurement methods, 
instruments, and infrastructure to support the accurate measurement and 
accounting of weapons-usable nuclear material at Russian facilities. 
Reference materials, measurement methods, and instruments are needed to 
accurately measure the quantity and isotopic composition of nuclear 
material during inventories and transfers for input into accountability 
databases. Accurate material control and accounting measurements are 
key components to any MPC&A system. Through fiscal year 2006, DOE had 
spent about $10.8 million under this project and has purchased and 
distributed transportable equipment that allows for the testing of 
uranium and plutonium. 

MPC&A Security Culture: 

The MPC&A Security Culture project supports the overall MPC&A goal of 
assisting Russia with enhancing its capabilities and strengthening its 
commitment to operating and maintaining improved nuclear security by 
fostering the development of training centers and developing an 
outreach strategy to enhance partner countries' awareness and 
understanding of MPC&A benefits, e.g., an MPC&A security "culture." The 
main objective of this project is to establish an infrastructure that 
emphasizes the importance of MPC&A and increase the commitment 
throughout Russia to operate and maintain MPC&A systems with minimal 
U.S. support by reinforcing the necessary attitudes and beliefs 
required to instill a strong MPC&A culture. Accomplishments under this 
project include training 1,800 staff in security culture and initiating 
a pilot security culture coordinator project at nine sites. Through the 
end of fiscal year 2006, DOE had spent about $1.3 million on the MPC&A 
Security Culture project. 

In addition to its efforts to improve the security culture at Russian 
nuclear sites, DOE recently conducted a series of workshops for Russian 
officials on MPC&A best practices at U.S. nuclear sites. The workshops 
included presentations by U.S. MPC&A experts. In conducting this 
workshop series, DOE intends to further enhance the security culture at 
Russian sites by working to educate Russian site officials on the 
methods used at U.S. facilities, so that these best practices can be 
applied at Russian sites. 

Taxation and Customs: 

The MPC&A Taxation and Customs project began in 1999 to meet a 
congressional mandate that U.S. nuclear safety and security programs 
not pay taxes in Russia. The MPC&A program must obtain a certified tax 
exemption when providing technical equipment and services. The Taxation 
and Customs project assists DOE project teams' understanding of 
taxation and customs issues and ensures compliance with Russian laws. 
The project stays abreast of Russian taxation and customs legislation, 
as well as guidance on bureaucracy and requirements for tax exemption, 
by holding workshops for Russian sites; tracking the tax-exemption 
process; and maintaining a taxation Web site for DOE project teams. 
Through the end of fiscal year 2006, DOE had spent about $0.5 million 
on the project. 

[End of section] 

Appendix V: Comments from the Department of Energy: 

NNSA: 
National Nuclear Security Administration: 
Department of Energy: 
National Nuclear Security Administration: 
Washington, DC 20585: 

February 21, 2007: 

Mr. Gene Aloise: 
Director: 
Natural Resources and Environment: 
Government Accountability Office: 
Washington, DC: 

Dear Mr. Aloise: 

The National Nuclear Security Administration (NNSA) appreciates the 
opportunity to review the Government Accountability Office's (GAO) 
report, "Nuclear Nonproliferation: Progress Made in Improving Security 
at Russian Nuclear Sites, but the Long-Term Sustainability of U.S.- 
Funded Security Upgrades is Uncertain." We understand that this report 
was done at the request of the Chairman, House Energy and Commerce 
Committee, and the Chairman and Ranking Member of the Senate's 
Permanent Subcommittee on Investigations, Committee on Homeland 
Security and Governmental Affairs. 

While we generally concur with the findings in the report, we have a 
number of comments for clarification. 

Regarding the metric reporting the number of buildings secured, we 
agree that the metric as currently applied may be confusing, but we are 
already changing the metric to one that more accurately identifies the 
level of completion for upgrades. In addition, we would like to point 
out that important risk reduction activities, including additional 
delay at the target, two-person rule for access to material, and the 
confirmation of rapid base-line inventories, occur during rapid 
upgrades, which significantly reduce the risk of theft by both an 
outside adversary and a facility insider. We would also like to point 
out that during our upgrades process there is no sharp delineation 
between the completion of rapid upgrades and the beginning of 
comprehensive upgrades. In most situations comprehensive upgrades begin 
before rapid upgrades are completed, and in the 51 buildings identified 
in the GAO report, comprehensive upgrades are already underway, and are 
in varying stages of implementation. 

Regarding earned value management, we do not require our contractors to 
implement earned value management (EVM) systems for firm fixed price 
contracts such as the ones used by the Department to upgrade security 
on Russian nuclear weapon storage sites. DOE Policy P 413.1 and DOE 
Order O 413.3A instruct program managers to utilize EVM for the 
acquisition of capital assets for Departmental use, but specifically 
exclude projects conducted under cooperative agreements. The 
Department's Office of Engineering and Construction Management has 
confirmed that EVM is not required for projects at sensitive Russian 
military facilities, where day-to-day management of events could not be 
directly monitored by U.S. personnel. While EVM may be appropriate for 
contracting methodologies used by DOD --which feature "cost-plus-award 
fee" mechanisms and are executed through various task orders - our 
Laboratories negotiate fixed-priced contracts directly with Russian 
integrating contractors. Since we negotiate all costs upfront prior to 
commencing the upgrades, and these costs include all equipment and 
installation prices, there is zero-cost variance during the period of 
performance, for which EVM would otherwise be appropriate. We 
concentrate on managing possible schedule variances due to force 
majeure or unforeseen technical challenges that may arise during the 
period of performance, and have therefore implemented a system for 
managing large contracts, which combines classical milestone/work 
breakdown structure methodologies with those principles of EVM 
appropriate for assistance work in Russia. This system includes 
stringent periodic reporting requirements, institutionalized In- 
Progress Review meetings with contractors, and detailed laboratory 
analyses. This system helps us ensure that upgrades are installed in 
accordance with the established milestones, the conceptual designs 
agreed to between NNSA and the Russian MOD, and the site-specific 
designs required by the contracts. 

Regarding sustainability, as the report correctly points out, in the 
Bob Stump National Defense Authorization of 2003, the Congress directed 
us to transfer a sustainable MPC&A system to sole Russian support no 
later than January 1, 2013. To carry out this mandate, the Department 
has been actively engaged with the Russian Federal Atomic Energy Agency 
(Rosatom) to develop a program to transition full support to the 
Russian Federation. Rosatom and NNSA established a Joint Sustainability 
working group that has met on six occasions since January 2005 to 
develop a joint Russian-U.S. sustainability plan which identifies 
sustainability requirements that need to be met by each site before a 
full transition to sole Russian support can take place. We expect that 
a final plan will be presented to the Joint Coordinating Committee at 
its next meeting in April 2007. We have developed and recently updated 
our programmatic guidelines for sustainability that provide 
standardized criteria for sustaining MPC&A upgrades, and a list of 
sustainability indicators that we currently use to track progress at 15 
sites. We will extend the use of these metrics to all sites as they 
complete the MPC&A upgrades and incorporate the reporting into a 
sustainability management system as called for in the report. 

Should you have any questions related to this response, please contact 
Richard Speidel, Director, Policy and Internal Controls Management, or 
me. 

Sincerely, 

Signed by: 

Michael C. Kane: 
Associate Administrator for Management and Administration: 

cc: Deputy Administrator for Defense Nuclear Nonproliferation: 

[End of section] 

Appendix VI: GAO Contact and Staff Acknowledgments: 

GAO Contact: 

Gene Aloise, (202) 512-3841, or a [Hyperlink, aloisee@gao.gov] 
loisee@gao.gov: 

Staff Acknowledgments: 

In addition to the individual named above, R. Stockton Butler, Jeffery 
Hartnett, Lisa Henson, and Jim Shafer made significant contributions to 
this report. Other assistance was provided by John Delicath, Jennifer 
Echard, Brandon Haller, Gregory Marchand, Keith Rhodes, and Karen 
Richey. 

[End of section] 

Related GAO Products: 

Nuclear Nonproliferation: Better Management Controls Needed for Some 
DOE Projects in Russia and Other Countries. GAO-05-828. Washington, 
D.C.: August 29, 2005. 

Cooperative Threat Reduction: DOD Has Improved Its Management and 
Internal Controls, but Challenges Remain. GAO-05-329. Washington, D.C.: 
June 30, 2005. 

Weapons of Mass Destruction: Nonproliferation Programs Need Better 
Integration. GAO-05-157. Washington, D.C.: January 28, 2005. 

Weapons of Mass Destruction: Additional Russian Cooperation Needed to 
Facilitate U.S. Efforts to Improve Security at Russian Sites. GAO-03-
482. Washington, D.C.: March 24, 2003. 

Nuclear Nonproliferation: Security of Russia's Nuclear Material 
Improving; Further Enhancements Needed. GAO-01-312. Washington, D.C.: 
February 28, 2001. 

Nuclear Nonproliferation: Limited Progress in Improving Nuclear 
Material Security in Russia and the Newly Independent States. RCED/ 
NSIAD-00-82. Washington, D.C.: March 6, 2000. 

Weapons of Mass Destruction: Effort to Reduce Russian Arsenals May Cost 
More, Achieve Less Than Planned. NSIAD-99-76. Washington, D.C.: April 
13, 1999. 

Nuclear Nonproliferation: Status of U.S. Efforts to Improve Nuclear 
Materials Controls in Newly Independent States. NSIAD/RCED-96-89. 
Washington, D.C.: March 8, 1996. 

Soviet Nuclear Weapons: Priorities and Costs Associated with U.S. 
Dismantlement Assistance. NSIAD-93-154. Washington, D.C.: March 8, 
1993. 

(360674): 

FOOTNOTES 

[1] Weapons-usable nuclear materials are uranium enriched to 20 percent 
or greater in uranium-235 or uranium-233 isotopes and any plutonium 
containing less than 80 percent of the isotope plutonium-238 and less 
than 10 percent of the isotopes plutonium-241 and plutonium-242. These 
types of materials are of the quality used to make nuclear weapons. 

[2] We recently reported on U.S. efforts to combat nuclear smuggling. 
For additional information see GAO, Combating Nuclear Smuggling: 
Corruption, Maintenance, and Coordination Problems Challenge U.S. 
Efforts to Provide Radiation Detection Equipment to Other Countries, 
GAO-06-311 (Washington, D.C.: Mar. 14, 2006) and GAO, Preventing 
Nuclear Smuggling: DOE Has Made Limited Progress in Installing 
Radiation Detection Equipment at Highest Priority Foreign Seaports, GAO-
05-375 (Washington, D.C.: Mar. 31, 2005). 

[3] In 1991, the Congress passed the Soviet Nuclear Threat Reduction 
Act of 1991, popularly referred to as the Nunn-Lugar Act, authorizing 
U.S. threat reduction assistance to the former Soviet Union, due to 
concerns about the safety and security of Soviet nuclear weapons. Pub. 
L. No. 102-228, 105 Stat. 1691 (codified at 22 U.S.C. § 2551 note). The 
legislation authorized funding to assist the former Soviet Union with 
its efforts to (1) destroy nuclear, chemical and other weapons; (2) 
transport, store, disable and safeguard weapons in connection with 
their destruction; and (3) establish verifiable safeguards against the 
proliferation of such weapons. As a result of this assistance, Belarus, 
Kazakhstan, and Ukraine returned all Soviet nuclear weapons on their 
territories to Russia in the early 1990s. 

[4] NNSA is a separately organized agency within DOE that was created 
by the National Defense Authorization Act for Fiscal Year 2000, Pub. L. 
No. 106-65 (2000), with responsibility for the nation's nuclear 
weapons, nonproliferation, and naval reactors programs. 

[5] We reported on U.S. efforts to secure nuclear material and warheads 
in Russia, including DOE's MPC&A program, most recently in 2003. See 
GAO, Weapons of Mass Destruction: Additional Russian Cooperation Needed 
to Facilitate U.S. Efforts to Improve Security at Russian Sites, GAO- 
03-482 (Washington, D.C.: Mar. 24, 2003). 

[6] DOE, Programmatic Guidelines for Material Protection, Control, and 
Accounting Upgrades at Russian Facilities (first published December 
1998, revised September 2001 and December 2005). 

[7] DOE, Department of Energy Fiscal Year 2007 Congressional Budget 
Request, National Nuclear Security Administration, vol. 1, 514, 
February 2006. 

[8] Joint Statement by President Bush and President Putin on Nuclear 
Security Cooperation, February 24, 2005. 

[9] Joint Statement by President George W. Bush and President V. V. 
Putin, July 17, 2006. 

[10] Bob Stump National Defense Authorization Act for Fiscal Year 2003, 
Pub. L. No. 107-314, § 3156(b)(1) (codified at 50 U.S.C. § 2343). 

[11] The Office of the Second Line of Defense is composed of two 
programs: the Second Line of Defense-Core program and the Megaports 
Initiative. We recently reported on these efforts, which are not 
discussed in this report. For additional information, see GAO-06-311 
and GAO-05-375. 

[12] Additional information on DOE's MPC&A efforts in countries outside 
of Russia can be found in appendix III. 

[13] DOE officials noted that comprehensive upgrades work is in 
"varying stages of implementation" at these 51 buildings. 

[14] DOE and DOD differ somewhat in their definition of what 
constitutes a "site." For example, some temporary nuclear warhead 
storage sites controlled by the Russian Navy, where DOE installed 
upgrades, consist of one or more piers where submarines are berthed, 
which are generally smaller than permanent warhead storage sites. 

[15] We reported in 2003 that DOE and DOD did not have consistent plans 
to balance nuclear warhead security improvements against the 
possibility of enhancing the operational capability of Russia's nuclear 
forces. In January 2003, the National Security Council issued 
guidelines that generally prohibited assistance to operational sites 
due to concerns that U.S. assistance might enhance Russia's military 
capability. As a result of these guidelines and other internal policy 
decisions, DOE plans no further assistance to 21 nuclear warhead sites 
where the department had installed rapid upgrades and one additional 
site where DOE had installed both rapid and comprehensive upgrades. 

[16] An EVM system compares the value of the work accomplished during a 
given period with the value of the work scheduled to be accomplished 
during that period. Differences from the scheduled work plan are 
measured in both cost and schedule variances. For example, program 
activities that are completed ahead of schedule would be reported as 
positive variances, while activities that are completed behind schedule 
would be reported as negative variances. Similarly, the EVM system 
tracks whether completed activities are costing more or less than 
expected. A negative cost variance would indicate that activities are 
costing more than expected, while a positive cost variance would mean 
activities are costing less than expected. 

[17] Office of Management and Budget, Office of Management and Budget 
Circular No. A-11, Part 7, Planning, Budgeting, Acquisition, and 
Management of Capital Assets (June 30, 2006). 

[18] Two of these fixed-price contracts are managed by Sandia National 
Laboratories, and two are managed by Oak Ridge National Laboratory. 

[19] Since DOE negotiates fixed-price contracts for its work to improve 
security at Russian nuclear warhead sites, an EVM system would only 
track schedule variances, rather than cost and schedule variances. As a 
result, DOE has elected to monitor schedules with comparable, but less 
expensive alternatives to EVM. 

[20] For example, in 1999, Russia's foreign debt amounted to about 96 
percent of its gross domestic product, but in 2006, it fell to about 9 
percent. Russia's economy was expected to grow about 6 percent in 2006. 

[21] GAO, Nuclear Nonproliferation: Security of Russia's Nuclear 
Material Improving; Further Enhancements Needed, GAO-01-312 
(Washington, D.C.: Feb. 28, 2001). 

[22] In addition, two other sites that do not contain nuclear material 
had been provided with MOM systems--the Interdepartmental Special 
Training Center, where Russian officials are trained on MPC&A systems, 
and the Information Security Center, which performs certification 
activities for MOM equipment. 

[23] DOE and Rosatom have agreed to install a pilot MOM system in 
Rosatom's Situation and Crisis Center in Moscow. Although this facility 
does not have nuclear material, it functions as a technical center 
authorized by Rosatom to evaluate the feasibility of using the MOM 
system at Rosatom sites. DOE officials are hopeful that Rosatom will 
allow the installation of MOM equipment at its facilities in the near 
future. 

[24] DOD's Security Assessment and Training Center, which was completed 
in fiscal year 2003 at a cost of $25.9 million and is located near 
Moscow, serves a similar purpose for sites located in the Moscow 
region. DOD is also funding the construction of a third facility, the 
Far East Training Center, to support sites in the Russian Far East, 
including the Russian Navy's Pacific Fleet. DOD expects the facility to 
be completed in 2009 at a cost of $16.9 million. 

[25] DOD and DOE's guidance in these directives requires the use of EVM 
on contracts valued over $20 million. 

[26] We followed up with DOD program managers who stated that they had 
identified this same variance through use of their EVM system. DOD 
officials stated that this schedule variance had been addressed with a 
plan to recoup lost work and, in any case, the variance did not affect 
the critical path forward. They remained confident that they would 
complete upgrades within their scope by the 2008 deadline. 

[27] From fiscal year 1993 through fiscal year 2006, DOE's MPC&A 
projects in Belarus, Georgia, Latvia, Lithuania, Kazakhstan, Ukraine, 
and Uzbekistan were managed by four separate offices within NNSA and 
one task force. Program activities in these countries included work on 
physical protection, material control and accounting, International 
Atomic Energy Agency safeguards requirements, and other nuclear 
security issues. Funding noted here reflects the total level of effort 
in this region, though the majority of funds cited relate to the MPC&A 
activities on which this report focuses. 

[28] The Department of State's Selective Engagement Policy prohibits a 
variety of U.S. assistance to Belarus and was applied to that country 
beginning in 1997. 

[29] We reported in 2000 that DOE improved the security at the Ignalina 
Nuclear Power Plant because the nuclear security systems would assist 
the site in implementing the International Atomic Energy Agency 
safeguards. Safeguards are systems designed to limit the risk of 
proliferation through the diversion of nuclear materials and assist 
efforts to reduce global nuclear weapons stockpiles. See GAO, Nuclear 
Nonproliferation: Limited Progress in Improving Nuclear Material 
Security in Russia and the Newly Independent States, GAO/RCED/NSIAD-00- 
82 (Washington, D.C.: Mar. 6, 2000). 

[30] The costs of this project are not readily available and, as a 
result, are not included in our total of DOE spending on MPC&A 
assistance in Kazakhstan. 

[31] Prior to fiscal year 2003, funding for this project derived from 
DOE's Office of Nuclear Warhead Protection. From fiscal year 2003 
through fiscal year 2006, funding for the project came from the budget 
of DOE's Office of National Infrastructure and Sustainability, which 
spent $21.2 million on its construction. 

[32] Founded in 1955, the Monterey Institute of International Studies 
is located in Monterey, California, with a mission of improving 
international understanding through education in languages, cross- 
cultural communications, and a detailed study of the complex relations 
between nations and peoples. 

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