Nuclear Cleanup:

Preliminary Results of the Review of the Department of Energy's Rocky Flats Closure Projects

GAO-05-1044R: Published: Sep 22, 2005. Publicly Released: Sep 22, 2005.

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For about 40 years, the Department of Energy's Rocky Flats site, near Denver, served as a production facility that made plutonium triggers, or "pits," for nuclear weapons. That role resulted in radiological and chemical contamination of many of the site's buildings and its soil and water. Cleanup of the site, which commenced in 1996, has been a monumental undertaking. The cleanup is being conducted under the Rocky Flats Cleanup Agreement, which is the legally binding agreement that provides the framework for the cleanup effort. The cleanup agreement specifies the roles of the Department of Energy (DOE) and the two regulatory agencies for the site: the Environmental Protection Agency (EPA) and the Colorado Department of Public Health and Environment (Colorado). In February 2001, when GAO last reported on DOE's project to clean up and close the Rocky Flats site, the project was slightly over cost and behind schedule. The vast amount of work remaining to be done at that time, along with various major challenges facing the cleanup contractor, made it doubtful that the contractor could achieve its December 2006 closure goal. But now the contractor hired by DOE (Kaiser-Hill Company, L.L.C.) plans to complete the physical cleanup portion of the work early and under budget. The regulatory agencies' final decision on the adequacy of the cleanup will take another year or so after completion of the physical cleanup, and the majority of the planned wildlife refuge will not open to the public for at least 5 years. In this context, Congress asked us to determine (1) the key factors that contributed to the progress of the Rocky Flats cleanup; (2) when the Rocky Flats cleanup is scheduled to be completed, and at what total cost, including long-term stewardship costs; and (3) what measures DOE and the regulatory agencies are taking to determine that the cleanup will achieve a level of protection of public health and environment consistent with the cleanup agreement.

According to DOE, the contractor, and the regulatory agencies, four key factors contributed to the cleanup's progress to date. These key factors are as follows: (1) The cost-plus-incentive-fee contract provided Kaiser-Hill with strong profit incentives to complete the work quickly and safely; (2) EPA's Superfund accelerated cleanup process allowed cleanup actions to proceed much more quickly and collaboratively than would have happened under the traditional Superfund process; (3) A confluence of site-specific events--climatic, geologic, chemical, and structural--aided the cleanup effort by confining both its scope and its complexity; and (4) The major challenges facing the contractor at the time of our last report have been resolved, except for safety, which has since improved but nonetheless will remain a concern as long as work goes on at the site. The contractor plans to finish the physical completion portion of the cleanup at Rocky Flats in late October 2005. "Physical completion" means that the contractor has met all contractual requirements, which include, for example, removing all buildings, waste, vehicles, and signage from the site and remediating contamination to the appropriate levels. After the contractor finishes its cleanup work, a number of regulatory and land-transfer events must occur before the Rocky Flats National Wildlife Refuge will open to the public. The cleanup project will cost about $7 billion (since 1995), according to DOE, which includes an approximately $510 million incentive fee to the contractor. DOE estimates additional long-term surveillance and maintenance costs of at least $7 million per year; this estimate is for fiscal years 2007 through 2011, although some of these costs may continue indefinitely. For contractor employees at Rocky Flats, DOE's pension and postretirement benefits liability in fiscal year 2004 amounted to nearly $100 million. DOE expects to continue paying between $64 million and $110 million per year for such benefits; the actual amount paid will fluctuate within this range depending on market and actuarial conditions and is expected to decrease after about 25 years. This estimate of benefit costs does not include up to an additional $15 million expected to be funded to cover additional payments for contractor employees whose benefits would be affected by the cleanup's physical completion a year ahead of schedule. Additional costs associated with Rocky Flats include pending legislation that proposes authorizing up to $10 million to purchase some privately held mineral rights at Rocky Flats, and a growing number of claims under the Energy Employees Occupational Illness Compensation Program Act of 2000 for harmful beryllium exposure at the site. Numerous measures have been and are being taken to provide assurance to DOE and the regulatory agencies that the cleanup will achieve a level of protection of public health and the environment consistent with the cleanup agreement. These measures include EPA's and Colorado's regulatory approvals of interim and final cleanup actions, DOE-initiated cleanup verification reviews, and independent reviews by scientific organizations and contractors.

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