Nuclear Cleanup Contractors Cited for Errors, Overruns Getting Stimulus Money
Monday, May 18, 2009
A private company was being paid $300 million by the federal government to clean up radioactive waste at two abandoned Cold War plants in Tennessee when an ironworker crashed through a rotted floor. That prompted a major safety review, which ended up forcing work to an abrupt halt, and the project was shut down for months. The delay and a host of other problems caused cost estimates to rise, eventually hitting $781 million.
Now, President Obama's stimulus package is opening a bountiful stream of new funding, and the same contractor, Bechtel Jacobs, is slated to get $118 million to help complete the job.
The Energy Department has begun releasing more than $6 billion in stimulus money to clean up 18 nuclear sites from New York to California, more than doubling the typical yearly funding for the program. Contractors helped shape the stimulus package and are lined up to get the work, including many that have been cited for serious safety violations and costly mistakes.
The contracts -- along with much broader problems in the department's nuclear cleanup program -- have prompted rare, sharply worded warnings from some government officials and lawmakers who say the stimulus funding is ripe for abuse.
The cleanup program has long been plagued by cost overruns and delays and is designated by the Government Accountability Office as "at high risk for fraud, waste, abuse and mismanagement." Over the past two years, estimated cleanup costs at all 22 sites have escalated from $180 billion to $240 billion, according to the Energy Department.
"The very contractors that have been responsible for cost overruns and serious delays have proposed how to pump stimulus money back into the project," said Gerry Pollet, executive director of Heart of America Northwest, an environmental watchdog group. The companies "are set to get hundreds of millions of dollars on top of the money they've already received, for the same projects they've seriously mismanaged."
Energy Department officials, as well as the contractors, point out that nuclear cleanup work is exceedingly complex and that some problems have been unavoidable. Still, the boost in funds to a troubled federal program highlights the potential pitfalls as $787 billion in stimulus funding flows out to federal, state and local programs across the country.
In the case of the Energy Department program, private contractors do all cleanup work, and they have been involved from the beginning in shaping their piece of the stimulus. As far back as December, when it became clear that Obama would introduce a huge spending bill to create jobs, Energy Department staff members began meeting with the contractors, including representatives from Bechtel National, CH2M Hill and other large firms.
A $6.4 billion plan was devised at the sessions and carried forward by Sen. Patty Murray (D-Wash.), who incorporated the funding into the Senate bill. The House version of the bill provided for $500 million.
But Murray pushed for the larger figure, saying in an interview that hundreds of acres would be removed from the nation's "footprint of contamination" and that the projects were a perfect fit for stimulus spending because they would create jobs -- the Energy Department has estimated 13,000.
The final version of the legislation included $6 billion for nuclear cleanup, and the department said it would negotiate with current contractors, rather than conduct a lengthy competitive bidding process, to meet spending deadlines. Most work will begin in the coming months and is supposed to be completed by the end of 2011.
It is already clear that many of the same contractors whose problems have been noted in dozens of GAO and inspector general reports are once more in line for federal money.