Chapter 5 Path Forward

The Department has already made significant progress in improving its materials management and accelerating the disposition of some materials in inventory. However, more action is needed to ensure that the Department's inventories of materials are appropriate for planned programs and activities, and that unneeded materials are identified and dispositioned promptly to avoid the accumulation of large amounts of surplus items. To achieve this progress and to reflect its current mission, the Department needs to modify management practices that have been carried over from former missions.

Findings and Recommendations

This chapter explains the MIN Initiative's overall findings and recommendations. Chapters 2 through 4 of this report presented observations about inventory priorities, management practices, and disposition options and barriers associated with materials in inventory. The Department presents several findings from these observations. For each of these findings, the Department can take actions to address problems and improve materials management. The next steps for some of these actions are apparent; others will require further evaluation. Many of the MIN teams also presented material-specific options in the team reports. Evaluating these options may require extensive discussions between the Department and stakeholders. Some of these material-specific options are included below as examples, where appropriate, to illustrate how the Department might implement changes to improve materials management.

Finding 1: The Department's inventories of materials exceed current mission needs.

Recommendation 1a: Continue initiatives to align inventories of materials with Department missions. The Department is in the process of defining its future missions and does not yet know all of its future materials needs. As it defines these missions, now and in the future, the Department needs to adjust its materials inventories to make them consistent with its mission needs.

Examples from the team reports:

• The Lead Team recommends that the Department develop a mechanism for identifying lead needs for all existing, new, and planned facilities.

• The Lithium Team reports that the Department is in the process of selling its virgin and depleted lithium at the K-25 and Portsmouth sites, but intends to retain its strategic enriched lithium. Some amount of strategic lithium will likely be needed for the Department's new tritium production facility. The exact amount of lithium needed will depend upon the technology chosen.

Recommendation 1b: Fill gaps in the Department's knowledge of inventory quantities, characteristics, and vulnerabilities. For some materials, the Department is not able to assess easily the amount and condition of materials currently in inventory, which makes it very difficult to align inventories with missions. This is particularly true for equipment, scrap metal, and chemicals. In some cases, a better understanding of the physical condition and contamination levels of materials is needed before it will be possible to disposition them. In addition, the Department's lack of centralized, integrated knowledge about various management practices and storage conditions throughout the complex often impedes proper and expeditious resolution of issues associated with materials in inventory. In cases where additional information may change an overall action, the Department needs to identify, prioritize, and fill information gaps, both for specific materials and for its materials management systems as a whole.

An example from the team reports:

• The Depleted Uranium Team recommends that the Department conduct additional surveys to determine the adequacy of DU storage containers and buildings.

Recommendation 1c: Expedite plans to convert materials in inventory to stable, suitable forms to facilitate disposition. Many materials in inventory are currently in forms that pose vulnerabilities, require unnecessarily expensive management, and prevent implementation of the best disposition option. Converting these materials to a different form will often reduce risks and costs in the long-term and will increase disposition rates. Significant work has already been done through Implementation Plans for Defense Nuclear Facilities Safety Board (DNFSB) Recommendation 94-1, which are aimed at stabilizing nuclear materials.[39]

Recommendation 1d: Prioritize and implement characterization of materials to facilitate disposition. Some materials in inventory are not sufficiently characterized to allow planning for proper management and disposition. The Department needs to identify these materials and plan carefully to ensure their cost-effective characterization and subsequent disposition.

Finding 2: Inventory information and materials management systems vary greatly across material types and sites.

Recommendation 2a: Establish consistent and compatible inventory information structures nationwide, including consistent terminology. Department regulations allow sites and programs to create and maintain their own inventory information structures and to identify excess or surplus materials. This site-specific approach makes inter-site and inter-program discussions and disposition decisions difficult. More consistent national systems would also reduce the need for sites to expend substantial resources on multiple information requests from Headquarters or on independently developing systems that may already exist at other sites. However, such an undertaking would require a great deal of planning to ensure that the benefits outweigh the expense of creating information systems that require maintenance, care, and updating.

Recommendation 2b: Evaluate and, where necessary, change outdated materials management systems that result in unnecessary costs. The Department is still using management techniques that were appropriate for production processes, but that have not changed to reflect new missions and requirements. For example, when the Department was producing nuclear weapons, most spent nuclear fuel was stored only for short periods of time until it was chemically separated in reprocessing canyons. As a result of the halt in reprocessing, spent nuclear fuel designed for short-term storage now has been in storage for many years. Sites currently use the same facilities and management practices that were used when the fuel was being reprocessed. These facilities and practices were not designed for long-term storage. For several materials, the Department needs to develop management systems that are suited and appropriately scaled to new Department missions.

Finding 3: The Department does not have clear and effective organizational structures for inventory management and disposition for some materials in inventory.

Recommendation 3a: The Department should evaluate the merits of a centralized management structure for all aspects of managing materials in inventory. Currently, multiple program offices and landlord organizations, contractors, oversight organizations, and Headquarters offices share responsibilities for materials management. This shared responsibility often leads to situations in which final authority for specific materials management decisions is unclear. Because of this fragmentation, few parties managing materials have incentives or requirements to identify excess materials and encourage their disposition. The Department needs to evaluate all options for creating an effective management structure, including using existing organizations as well as creating cross-program planning and implementation teams.

Recommendation 3b: Increase communication among sites to facilitate disposition. Increased communication among sites would streamline the development and implementation of Department-wide disposition plans.

Examples from the team reports:

• The Lead Team recommends developing a DOE lead network, including electronic communication, to facilitate inter-site communication about lead transfer and reuse possibilities.

• The Sodium Team suggested that the Department replace individual sales negotiations at several sites with a single negotiation strategy for all of MIN sodium, thereby coordinating its efforts more efficiently and potentially obtaining higher prices.

Recommendation 3c: Continue to create mechanisms to identify and prevent orphan materials and create incentives and requirements to ensure that programs maintain ownership of these materials until properly dispositioned. Materials are sometimes "orphaned"--neither retained by the previous owner nor accepted by another owner--when projects are terminated. Without an attentive steward, these orphan materials are often not dispositioned in a timely manner. Some sites have programs and policies in place to address these situations. For many sites, the costs of orphan materials are carried in overhead or indirect cost accounts where they often are not seen as "costs" to a program. Programs need to be held fiscally accountable for materials they no longer need and for managing them once a project ends.

An example from the team reports:

• The Chemicals Team recommends that all sites with chemicals fully implement comprehensive chemical life-cycle management systems. Inventory systems that are capable of tracking chemicals from procurement to disposition will minimize the accumulation of excess/surplus chemicals and reduce the number of orphaned chemicals. Ultimately, these systems will greatly reduce both management costs and vulnerabilities associated with chemicals.

Finding 4: The Department lacks policies to require or encourage its programs to identify and disposition materials that are no longer needed.

Recommendation 4a: Create incentives and requirements for programs and sites to identify and disposition unneeded materials. For most non-nuclear materials, no requirements exist for identifying and dispositioning unneeded materials. In some cases, such as for nuclear materials, DOE Orders require planning and forecasting of annual material needs. However, these Orders do not address what should be done with materials that are not required to meet these forecasted needs. Currently, storage is often an easier management path for many materials in inventory even if it is not the least expensive solution for the Department in the long run. To the extent possible, programs and sites need requirements and incentives to disposition materials. These incentives could include allowing sites to keep any revenues that are generated through disposition or rewarding contractors explicitly through contractual mechanisms for reducing inventories.

Recommendation 4b: Establish policies regarding how long to retain materials in anticipation of a potential future use. The Department does not have a clear requirement for programs to identify materials they must retain and those they no longer need. Materials with only slight chances of future use often remain in storage just in case they are needed. Plans to use or disposition the materials are made and are then dropped while the materials themselves remain in storage. Programs need guidelines to justify, on an annual basis, the continued retention of materials and to identify contingency plans to ensure timely disposition of those materials that are no longer needed by the Department. This guidance must reflect the fact that the Department does not have production capabilities or sources to repurchase some materials, such as some nuclear materials.

Guidance on how long to retain materials would have been helpful at Hanford in 1967, when the Department acquired 34,300 gallons of slightly radioactive sodium for use in planned upgrades to the Fast Flux Test Facility (FFTF). The upgrades never took place. Other uses for the material were planned but never occurred. As a result, the sodium remains at the site today. A Department policy limiting the amount of time materials may be retained in anticipation of a potential future use could have enabled disposition of this sodium years ago.

Finding 5: Policy and legal barriers hinder disposition of materials in inventory.

Recommendation 5a: Develop Department-wide guidance for implementing the "no radioactivity added" policy. Two barriers identified most often in the team reports as hindering timely disposition of materials are the implementation of the Department's "no radioactivity added" policy and the lack of external regulations on residual radioactivity. The Department's "no radioactivity added" policy, as currently implemented, impedes disposition because it is easier and cheaper in the short term to assume materials are contaminated than it is to survey and verify their condition. Sites implement the Department's "no radioactivity added policy" in many different ways. These different approaches discourage consolidation of materials among sites and make multi-site sales of materials more difficult. The Department needs system-wide implementation guidance that both addresses the safety concerns and ensures materials are dispositioned in a timely manner.

Recommendation 5b: The Department needs to continue to work with EPA and NRC to expedite the establishment of appropriate release criteria and procedures. Without a standard to determine whether materials can be released from the Department for some outside use, disposition of contaminated, or potentially contaminated, materials is difficult.

Finding 6: The Department does not understand sufficiently the costs of managing most materials in inventory, resolving vulnerabilities, and disposal as compared with other management options.

Recommendation 6a: Assign the costs of inventory management to the programs responsible for the materials. Costs for managing many materials in inventory are often included in site-wide, "indirect cost" accounts since no single program is responsible for them. As a result, the costs are spread across programs and specific programs are not held financially accountable. To increase accountability and visibility of actual costs, the Department needs to develop a way to identify the costs of managing materials in inventory. The most effective way to do this is to assign financial responsibility to the program for which the materials are stored or used. This, as well as other options, must be examined.

Recommendation 6b: Establish a policy that requires programs to develop disposition plans at the time of purchase of materials, identify disposition costs, and evaluate contingencies for these plans. The Department exhibits a tendency for ending programs without fully considering materials management issues. By merely leaving materials in place, the Department has created significant cleanup and materials management issues that could have been avoided with better initial planning. Every project should have contingency plans and schedules for shutting down prematurely or unexpectedly, as well as when the project is complete.

Recommendation 6c: Establish guidance on disposition decisionmaking to require consideration of life-cycle costs. The Department does not have guidance on how to account for life-cycle cost for materials. Materials management and disposition decisions are often made on the basis of site- or program-specific concerns that do not result in the best decisions for the Department as a whole.

Material-specific Team Options

In addition to these Department-wide findings and recommendations, the MIN team reports include material-specific options about decisions, policies, or actions the Department should take. This report does not analyze these team-specific options in-depth; however, they merit attention and follow-up. Material-specific options appear in Table 5-1, Path Forward Options for Each MIN Team.