	Background

The Spallation Neutron Source Project is, according to DOE and its scientific advisers, vitally important to the nation’s scientific community. The Congress approved the start of the construction phase in fiscal year 1999 and provided $130 million for this purpose. As this Subcommittee is well aware, DOE has not always managed large projects successfully. One reason for the cost and schedule problems associated with these projects was the lack of sufficient DOE personnel with the appropriate skills to oversee contractors’ operations. Concerns About the Project’s Leadership

In a 1997 review, DOE reported that the success of the project depends on a having a project director skilled in accelerator science and in the management of large construction projects. “It will also be a mark of  ability to execute this project that key scientific, technical, and management leadership, committed to making the  succeed, can be successfully recruited to  before the project is funded by Congress.” Despite this recognized need and the Congress’s approval of the project’s construction phase 5 months earlier (the Congress provided funding for design activities beginning in fiscal year 1996), Oak Ridge National Laboratory has just announced the hiring of an experienced project director. Other key positions remain unfilled. DOE’s independent reviewer expressed a similar concern, noting that the cost estimate in the project is based on its design and that “higher quality estimates are needed for a credible baseline.”
Of particular concern are the inadequate allowances for contingencies (unforeseen costs and delays) built into the project’s current cost and schedule estimates. In particular, integrating the efforts of five national laboratories on a project of this scope requires an unprecedented level of collaboration. Los Alamos, however, is primarily funded by DOE’s Defense Programs, a different component within DOE’s complex organizational structure.
Why GAO Did This Study

Pursuant to a congressional request, GAO discussed the Department of Energy's (DOE) management of the Spallation Neutron Source Project, focusing on the: (1) project's cost and schedule; and (2) effectiveness of the collaborating laboratories' coordination.

What GAO Found

GAO noted that: (1) the project is not currently in trouble, but warning signs in three key areas raise concerns about whether it will be completed on time and within budget; (2) DOE has not assembled a complete team with the technical skills and experience needed to properly manage the project; (3) a permanent project director was just hired last week, 5 months after Congress approved the start of construction and over a year after the project's design was approved; (4) other important positions remain unfilled, including those of a technical director and an operations manager; (5) cost and schedule estimates for the project have not been fully developed; (6) furthermore, the project's contingency allowances for unforeseen costs and delays are too low for a project of this size and scope, according to project managers and DOE; (7) DOE's approach to managing the project requires an unprecedented level of collaboration among five different laboratories, managed through DOE's complex organizational structure; and (8) coupled with DOE's history of not successfully completing large projects on time and within budget, these warning signs make the Spallation Neutron Source project a significant management challenge for DOE and suggest a need for continued close oversight.