Some Projects Have Met or Are Expected to Meet Their Performance Targets, but EM and NNSA Did Not Clearly Document Information Needed to Determine the Performance of Others

Of the 71 EM and NNSA nonmajor projects we reviewed that were  completed or ongoing for fiscal years 2008 to 2012, we were able to  determine performance for 44 projects. Among these 44 projects, 21 have  met or are expected to meet all three of their performance targets for the  scope of work delivered, cost, and completion date, while 23 have not  met or are not expected to meet one or more of their three targets. EM and NNSA Have Met or Are Expected to Meet All Performance Targets for Some Nonmajor Projects

Of the 71 nonmajor projects we reviewed, 44 projects—17 EM projects  and 27 NNSA projects—had documented targets for scope, cost, and  completion date, enabling us to determine their performance. These projects included a $22 million EM project to  expand an existing waste disposal facility at the Oak Ridge Reservation in  Tennessee and a $469 million NNSA project to construct chemical,  electrical, and other laboratories and workspaces at the Sandia National  Laboratories in New Mexico. These  projects included a $77 million EM project to construct two disposal units  for storing waste at the Savannah River Site in South Carolina and a  $199 million NNSA project to equip the Radiological Laboratory/Utility/  Office Building at the Los Alamos National Laboratory in New Mexico to  make it suitable for performing programmatic work. In  addition, one project did not meet any of its performance targets. First, EM and NNSA did  not consistently follow DOE requirements for documenting scope targets  and tracking these targets using DOE’s performance database. Establishing a clearly defined target for scope is critical for an agency to  accurately track and assess a project’s overall performance. Limited Documentation or Changing Performance Baselines Complicates Evaluation of 27 Projects’ Performance

We were unable to determine the extent to which 27 of the 71 nonmajor  projects that EM and NNSA completed or had under way from fiscal year  2008 through fiscal year 2012 had met their scope, cost, and completion  date targets for four reasons. Several Factors Affect EM and NNSA in Managing Nonmajor Projects

Several factors affected EM and NNSA in managing their nonmajor  projects that were completed or ongoing from fiscal years 2008 to 2012. According to our interviews with project officials, these factors included  the suitability of the acquisition strategy, contractor performance, and  adherence to project management requirements. According to project officials, the fee structure under this acquisition  strategy is relatively simple and gives the project team flexibility to tie  incentives to different performance milestones across the multiple  subprojects within the contract. For example, according to NNSA project officials at the Los  Alamos site office, the M&O contractor at the Los Alamos National  Laboratory decided to construct the Radiological Laboratory/Utility/Office  Building project using a design-build acquisition strategy with a single  prime subcontractor responsible for both design and construction. EM’s Workforce Plans Do Not Consistently Identify Mission- Critical Occupations and Skills or Shortfalls in These Areas

EM’s eight workforce plans for its federal workforce do not consistently  identify (1) mission-critical occupations and skills and (2) current and  future shortfalls in these areas. Notwithstanding the variations in terms for mission-critical occupations  and skills in EM’s workforce plans, many of the plans indicate that EM’s  federal workforce may soon face shortfalls in a number of important  areas, including project and contract management. EM officials said that they recognize the need to better identify mission- critical occupations and skills and shortfalls in these areas, and that they  have taken a number of steps to address these issues. For example,  officials in EM’s Office of Human Capital told us that they conducted a  skills assessment in 2010 that helped EM identify key occupational series  to target in its succession planning efforts. Recommendations for Executive Action

To ensure that DOE better tracks information on its nonmajor projects,  including the extent to which these projects meet their performance  targets, and that EM consistently identifies mission-critical occupations  and skills, as well as any current and future shortfalls in these areas, in its  workforce plans, we recommend that the Secretary of Energy take the  following five actions:
Ensure that the department clearly defines performance targets— including targets for scope, cost, and completion date—for each of its  projects and documents the targets in appropriate CD-2  documentation, as is required by DOE’s project management order. GAO staff who made key contributions to  this report are listed in appendix V.

Appendix I: Scope and Methodology

To determine the extent to which the Department of Energy’s (DOE)  Office of Environmental Management (EM) and National Nuclear Security  Administration (NNSA) nonmajor projects have met their scope, cost, and  completion date targets, we obtained performance information on 71  nonmajor projects. Therefore, we obtained data on project scope, cost, and schedule  directly from EM and NNSA officials. To evaluate the extent to which EM’s workforce plans identify mission- critical occupations and skills and any current and future shortfalls in  these areas, we examined EM’s strategic workforce plans for its  headquarters and site office staff, DOE’s corrective action plan for  contract and project management, and the Office of Personnel  Management’s Human Capital Assessment and Accountability  Framework.
Why GAO Did This Study

As of February 2011, EM and NNSA remained on GAO's high-risk list for contracting and project management. These two offices manage numerous construction and cleanup projects that each cost less than $750 million and are called nonmajor projects. DOE requires its program offices to establish performance targets for the expected scope, cost, and completion date of each project before starting construction or cleanup. GAO has encouraged federal agencies to use strategic workforce planning to help them meet present and future mission requirements. Two key elements of workforce planning are to identify mission-critical occupations and skills and any current and future shortfalls in these areas. GAO was asked to examine the (1) extent to which EM and NNSA nonmajor projects have met their scope, cost, and completion date targets, (2) factors affecting EM's and NNSA's management of nonmajor projects, and (3) extent to which EM's workforce plans identify mission-critical occupations and skills and any current and future shortfalls in these areas. GAO reviewed DOE documents and project data, examined EM workforce plans, toured selected DOE facilities, and interviewed DOE officials.

What GAO Found

Of the 71 nonmajor projects that the Department of Energy's (DOE) Office of Environmental Management (EM) and National Nuclear Security Administration (NNSA) completed or had under way from fiscal years 2008 to 2012, 21 met or are expected to meet their performance targets for scope, cost, and completion date. These projects included a $22 million EM project to expand an existing waste disposal facility at the Oak Ridge Reservation in Tennessee and a $199 million NNSA project to equip a radiological laboratory and office building at the Los Alamos National Laboratory in New Mexico. Another 23 projects did not meet or were not expected to meet one or more of their three performance targets for scope, cost, and completion date. Among these, 13 projects met or are expected to meet two targets, including a $548 million NNSA project to shut down a nuclear reactor in Russia for nonproliferation purposes; 8 projects met or are expected to meet one target; 1 project did not meet any of its targets; and 1 project was cancelled. Of the remaining 27 projects, many had insufficiently documented performance targets for scope, cost, or completion date, which prevented GAO from determining whether they met their performance targets. EM and NNSA often did not follow DOE requirements for documenting these performance targets, making it more difficult for GAO and DOE to independently assess project performance.
Several factors affected EM's and NNSA's management of their nonmajor projects that were completed or ongoing from fiscal years 2008 to 2012. These factors included the suitability of a project's acquisition strategy, contractor performance, and adherence to project management requirements. For example, EM officials managing an ongoing project to remediate soil and water at the Idaho National Laboratory used an acquisition strategy that tied incentives for the contractor to different performance milestones across the multiple subprojects within the contract, which will help the project meet its performance goals, according to EM officials. In contrast, NNSA encountered problems meeting its performance goals for a project to build an office building and radiological laboratory at the Los Alamos National Laboratory partly due to its acquisition strategy. According to NNSA project officials at the Los Alamos site office, the project team should have hired one contractor to design the project and solicited bids from other contractors to build the project rather than using the same contractor for both activities. The former strategy might have resulted in a more mature project design and more time to evaluate various contractors' qualifications to construct the project, according to the NNSA project officials.
EM's workforce plans do not consistently identify mission-critical occupations and skills and current and future shortfalls in these areas for its federal workforce. In addition, many EM workforce plans indicate that EM may soon face shortfalls in a number of important areas, including project and contract management. EM officials said that they recognize these issues and have taken a number of steps to address them, including conducting a skills assessment to identify key occupational series to target for succession planning. However, the inconsistent terms used to describe mission-critical occupations and skills in EM's workforce plans make it difficult for GAO and DOE to understand EM's most critical needs regarding its workforce. GAO recommends that EM and NNSA clearly define, document, and track the scope, cost, and completion date targets for each of their nonmajor projects and that EM clearly identify critical occupations and skills in its workforce plans. EM and NNSA agreed with GAO's recommendations.

What GAO Recommends

GAO recommends that EM and NNSA clearly define, document, and track the scope, cost, and completion date targets for each of their nonmajor projects and that EM clearly identify critical occupations and skills in its workforce plans. EM and NNSA agreed with GAOs recommendations.