[House Hearing, 114 Congress] [From the U.S. Government Publishing Office] ENERGY AND WATER DEVELOPMENT APPROPRIATIONS FOR 2017 _______________________________________________________________________ HEARINGS BEFORE A SUBCOMMITTEE OF THE COMMITTEE ON APPROPRIATIONS HOUSE OF REPRESENTATIVES ONE HUNDRED FOURTEENTH CONGRESS SECOND SESSION _______________________ SUBCOMMITTEE ON ENERGY AND WATER DEVELOPMENT MICHAEL K. SIMPSON, Idaho, Chairman RODNEY P. FRELINGHUYSEN, New Jersey MARCY KAPTUR, Ohio KEN CALVERT, California PETER J. VISCLOSKY, Indiana CHARLES J. FLEISCHMANN, Tennessee MICHAEL M. HONDA, California JEFF FORTENBERRY, Nebraska LUCILLE ROYBAL-ALLARD, California KAY GRANGER, Texas JAIME HERRERA BEUTLER, Washington DAVID G. VALADAO, California NOTE: Under Committee Rules, Mr. Rogers, as Chairman of the Full Committee, and Mrs. Lowey, as Ranking Minority Member of the Full Committee, are authorized to sit as Members of all Subcommittees. Donna Shahbaz, Angie Giancarlo, Loraine Heckenberg, Perry Yates, and Matthew Anderson Staff Assistants _____________________________ PART 8 NATIONAL NUCLEAR SECURITY ADMINISTRATION Energy Weapons Activities and Nuclear Nonproliferation and Naval Reactors [GRAPHIC NOT AVAILABLE IN TIFF FORMAT] ______________________________ Printed for the use of the Committee on Appropriations ______________________________ U.S. GOVERNMENT PUBLISHING OFFICE 20-843 WASHINGTON : 2016 _______________________________________________________________________________ COMMITTEE ON APPROPRIATIONS ---------- HAROLD ROGERS, Kentucky, Chairman RODNEY P. FRELINGHUYSEN, New Jersey NITA M. LOWEY, New York ROBERT B. ADERHOLT, Alabama MARCY KAPTUR, Ohio KAY GRANGER, Texas PETER J. VISCLOSKY, Indiana MICHAEL K. SIMPSON, Idaho JOSE E. SERRANO, New York JOHN ABNEY CULBERSON, Texas ROSA L. DeLAURO, Connecticut ANDER CRENSHAW, Florida DAVID E. PRICE, North Carolina JOHN R. CARTER, Texas LUCILLE ROYBAL-ALLARD, California KEN CALVERT, California SAM FARR, California TOM COLE, Oklahoma CHAKA FATTAH, Pennsylvania MARIO DIAZ-BALART, Florida SANFORD D. BISHOP, Jr., Georgia CHARLES W. DENT, Pennsylvania BARBARA LEE, California TOM GRAVES, Georgia MICHAEL M. HONDA, California KEVIN YODER, Kansas BETTY McCOLLUM, Minnesota STEVE WOMACK, Arkansas STEVE ISRAEL, New York JEFF FORTENBERRY, Nebraska TIM RYAN, Ohio THOMAS J. ROONEY, Florida C. A. DUTCH RUPPERSBERGER, Maryland CHARLES J. FLEISCHMANN, Tennessee DEBBIE WASSERMAN SCHULTZ, Florida JAIME HERRERA BEUTLER, Washington HENRY CUELLAR, Texas DAVID P. JOYCE, Ohio CHELLIE PINGREE, Maine DAVID G. VALADAO, California MIKE QUIGLEY, Illinois ANDY HARRIS, Maryland DEREK KILMER, Washington MARTHA ROBY, Alabama MARK E. AMODEI, Nevada CHRIS STEWART, Utah E. SCOTT RIGELL, Virginia DAVID W. JOLLY, Florida DAVID YOUNG, Iowa EVAN H. JENKINS, West Virginia STEVEN M. PALAZZO, Mississippi William E. Smith, Clerk and Staff Director (ii) ENERGY AND WATER DEVELOPMENT APPROPRIATIONS FOR 2017 ---------- Tuesday, March 1, 2016. DEPARTMENT OF ENERGY--NATIONAL NUCLEAR SECURITY ADMINISTRATION, WEAPONS AND ACTIVITIES AND NUCLEAR NONPROLIFERATION AND NAVAL REACTORS WITNESSES FRANK KLOTZ, ADMINISTRATOR FOR NUCLEAR SECURITY, DEPARTMENT OF ENERGY ANNE HARRINGTON, DEPUTY ADMINISTRATOR FOR DEFENSE NUCLEAR NONPROLIFERATION, DEPARTMENT OF ENERGY BRIGADIER GENERAL S.L. DAVIS, ACTING DEPUTY ADMINISTRATOR FOR DEFENSE PROGRAMS, DEPARTMENT OF ENERGY ADMIRAL JAMES FRANK CALDWELL, JR., DEPUTY ADMINISTRATOR FOR OFFICE OF NAVAL REACTORS, DEPARTMENT OF ENERGY Mr. Simpson. I would like to call this hearing to order and good afternoon, everyone. Administrator Klotz, I would like to welcome you to your second appearance before the Subcommittee to testify on the budget request for the National Nuclear Security Administration, which includes programs that sustain our nation's nuclear weapons stockpile, advance U.S. nuclear nonproliferation goals, and support the nuclear Navy. Admiral Caldwell, I would like to thank you for your service to this country and welcome you to your first appearance before this Subcommittee. Since the Director of Naval Reactors serves an 8-year term, we look forward to having you this year and many years to come. You are probably going to outlast me. I am at that stage of life where 8 years is like have we got our plots ready? General Davis, I would like also welcome you and thank you for your service to the country. This is the second time you have testified before the Subcommittee, but the first in your new capacity as the Acting Director of Defense Programs. Ms. Harrington, I welcome you back. I believe we may have actually lost count of the number of times you testified before this Subcommittee. The expertise you bring to the table is incredibly valuable and we thank you for your continued dedication to the nonproliferation programs. The President's Budget Request for the National Nuclear Security Administration is $12.9 billion, an increase of $357 million, or 2.9 percent above last year's level. Since the overall budget cap set by the Bipartisan Budget Control Act are flat compared to last year's level, the increases requested for defense activities for NNSA will need to compete with other important defense programs across the federal government. Within the NNSA budget request itself, that same competition for resources is evident. The Administration's nuclear modernization plans continue to exert large pressures on available funds. Weapons Activities has increased by $357 million and Naval Reactors is increased by $45 million, while Nonproliferation activities are decreased by $132 million. We hope to hear more from you today on the prioritization in your budget request and how you intend to accomplish the modernization activities that are need to extend the life of our nuclear deterrent within a constrained budget environment. Please ensure for the hearing record that responses to the questions for the record and any supporting information requested by the Subcommittee are delivered in final form to us no later than 4 weeks from the time you receive them. I also ask that if Members have additional questions they would like to submit to the Subcommittee for the record that they please do so by close of business on Thursday. With those opening comments I would like to yield to our Ranking Member, Ms. Kaptur, for any opening comments that she would like to make. [The information follows:] [GRAPHICS NOT AVAILABLE IN TIFF FORMAT] Ms. Kaptur. Thank you very much, Mr. Chairman. Welcome. Certainly General Klotz, Admiral Caldwell, Miss Harrington, and General Davis, we appreciate your appearing before the subcommittee this afternoon. And since this subcommittee last met to review the National Nuclear Security Administration Budget, the world continues to see challenges in disparate areas of our globe. It is through that lens that we must assess our strategic future, including importantly, nuclear security. The possession of nuclear weapons bring an awesome responsibility, and no one knows that more than you do. Still nuclear weapons serve as only one component of our national nuclear strategy. The NNSA nonproliferation program also plays an essential role in securing nuclear material globally and provides a rare, though admittedly recently more limited look into the Russian nuclear program. Congress, and this subcommittee in particular, must balance the need to maintain our nuclear weapons stockpile with the importance of reducing global vulnerabilities through nonproliferation efforts. And additionally the tremendous amount of money spent on nuclear capabilities compels a sharp attention to ensuring financial responsibility. The NNSA makes up a sizeable portion of this subcommittee's bill with nuclear weapons and Naval Reactors representing 83 percent of NNSA's total budget. Mindful of the many needs of our Nation this subcommittee must ensure precious resources are provided as part of a coherent strategy. Further, the NNSA must demonstrate a continued ability to better manage projects, particularly in the weapons account. I remain concerned about repeated and astonishing cost increases and schedule delays that plague the NNSA. The nuclear deterrent is too important and resources too precious to waste funds pursuing unnecessary or unrealistic proposals. While NNSA has made progress toward more rigorous project and financial management, much work remains as you well know. We look forward to our discussion today. Mr. Chairman, I thank you for yielding the time. And thank you all for being here. Mr. Simpson. And I understand, Administrator, you have the opening statement and you are going to do one. Mr. Klotz. Yes, sir. Mr. Simpson. And the others were submitted for the record, is that correct? Mr. Klotz. Yes, sir. Mr. Simpson. The time is yours. Mr. Klotz. Okay. Thank you, sir. Chairman Simpson, Ranking Member Kaptur, and members of the subcommittee, thank you for the opportunity to present the President's Fiscal Year 2017 Budget Request for the Department of Energy's National Nuclear Security Administration. We have provided you a written statement and respectfully request that it be submitted for the record. We value this committee's leadership in national security as well as its robust and abiding support for the missions and for the people of the NNSA. Our budget request, which comprises more than 40 percent of DOE's overall budget is $12.9 billion, an increase of nearly $357 million or 2.9 percent over the fiscal year 2016 enacted level. The budget request continues the Administration's unwavering commitment to NNSA's important and enduring missions. These missions are defined in the NNSA Strategic Vision, which we released at the end of last year. They include to maintain a safe, secure, and effective nuclear weapons stockpile; to prevent, counter, and respond to the threat of nuclear proliferation and nuclear terrorism; and, to support the capability of our nuclear powered Navy to project power and to protect American and Allied interests across the globe. To succeed, NNSA must maintain cross cutting capabilities that enable each core mission, again as defined in our Strategic Vision. These cross cuts focus on advancing science, technology, and engineering, supporting our people, and modernizing our infrastructure, and developing a management culture focused on safety, security, and efficiency, adopting the best practices and use across the government and in the commercial world. If you would like, I would also be pleased to provide a copy of this document to the subcommittee for the record. [A copy of the NNSA Strategic Vision follows:] [GRAPHICS NOT AVAILABLE IN TIFF FORMAT] Mr. Klotz. The budget materials and briefings we have provided describe NNSA's major accomplishments in the calendar year 2015, as well as the underlying rationale for our budget proposal for fiscal year 2017. Let me just briefly highlight a few points here. First and foremost, the United States has maintained a safe, secure, and effective nuclear weapons stockpile without nuclear explosive testing for over 20 years. NNSA's fiscal year 2017 budget request continues a steady increase in the Weapons Activity appropriation. And in fact, this account has increased more than 40 percent since the fiscal year 2010 budget request. As a result of the funding provided by this Congress and supported by this subcommittee, and the significant improvements NNSA has made in program management over the past two to three years, all of our life extension programs are now on schedule and within budget. NNSA's science and technology base also continues to yield critical modeling and simulation data and deploy increasingly capable high performance computing in support of stockpile stewardship. Last year, for example, the National Ignition Facility at Lawrence Livermore National Laboratory in California increased its shot rate--that is the number of experiments that it does--from 191 in 2014 to 357 in 2015, almost doubling the shot rate, including the first-ever experiments at NIF using plutonium. Our budget request also supports the recapitalization of NNSA's aging research and production infrastructure. Most notably the facilities where we perform our major uranium, plutonium, tritium, and other commodity operations. Of significance, NNSA completed the first subproject, titled Site Readiness, for the Uranium Processing Facility on time and under budget. This year's request for the Defense Nuclear Nonproliferation account is 6.8 percent lower than the fiscal year 2016 enacted level for two reasons. First, prior year carry over balances are available to execute several programs in this mission space. And second, we propose terminating the mixed oxide, or MOX Fuel Fabrication Facility project and pursuing a dilute and dispose approach as a faster, cheaper path to meeting our national commitment and international agreement to dispose of 34 metric tons of excess weapons grade plutonium. The request for our third appropriations, the Naval Reactors programs, keeps pace with mission needs and continues NNSA's commitment to the three major initiatives undertaken by NR: The OHIO-Class Reactor Plant System development, the land- based S8G Prototype refueling overhaul taking place in upstate New York, and the spent fuel handling recapitalization project in Idaho. For each of these missions, NNSA is driving improvements in management and governance. For all of our programs, we have instituted rigorous analysis of alternatives, defining clear lines of authority and accountability for Federal and contractor program and project management, improved cost and scheduled performance, and ensure that Federal project directors and contracting officers have the appropriate skill mix and professional certifications to effectively manage NNSA's work. Our budget request for the fourth appropriation, that is Federal Salaries and Expenses, reflects an increasing emphasis on improving program and project management across all our mission pillars. So, in closing, the nuclear security enterprise continues to make significant progress, although as the Ranking Member pointed out, there is still work to be done. Through discipline, careful planning, consistent funding, and your continued strong support, we believe we can make smart investments to build on that progress and to meet new challenges in the future. So, again, thank you for the opportunity to appear before you today. We all look forward to answering any questions you may have. [The information follows:] [GRAPHICS NOT AVAILABLE IN TIFF FORMAT] Mr. Simpson. Thank you, Administrator Klotz. Ms. Kaptur. Ms. Kaptur. Thank you, Mr. Chairman. General Klotz, I have a question relating to weapons dismantlement. And the budget request includes a significant increase for weapons dismantlement, something you have not typically supported, at least at this level. And I understand that some of this increase is due to Secretary Kerry's announcement to accelerate dismantlement by 20 percent. What benefits does this increase bring to the budget, to the workforce, and are there benefits beyond simply dismantling more weapons? Mr. Klotz. Thank you. That is an extraordinarily good question. We have all along been continuing a dismantlement program to dismantle all those weapons that were retired prior to the year 2009 by the year 2022. Last year, for instance, in fiscal year 2016 the Congress enacted $52 million to continue dismantlement activities which take place both at the Pantex Plant in Amarillo, Texas and at Y-12 in Oak Ridge, Tennessee. As you rightly pointed out, Secretary Kerry committed the Administration to seeking a 20 percent increase in the funding that we do for dismantlement, therefore our request for 2017 is roughly $69 million. So a significant increase. In addition to allowing us to complete or meet our pledge to dismantle all those weapons that were retired before the year 2009, it will allow us to do that a year earlier. But in addition to doing that, it will allow us to hire more staff at Pantex. We estimate that we will need to hire between 35 to 40 people at Pantex to do this increased workload. We will also need to hire an additional 10 people we estimate, at Y-12 to do this work. So once we have these people on board at both of those sites, they have gotten their security clearances, they understand how to the processes work at both plants, if the need arises elsewhere at Pantex or Y-12 for other work that we do, and we do work for all three of our mission pillars, particularly at Y-12, then those individuals will be ideally suited. So we also see it as a way of starting to build that next generation of workforce, both at Pantex and Y-12. Did you want to add anything to that? General Davis. No, sir. I will just simply add that these weapons will never be returned to the field in their current condition so dismantling them also gives us some strategic materials that we can use in our other life extension programs. So it also provides that role. Mr. Klotz. Even though a weapon has been retired, we continue to have to ensure the safety and security of those retired weapons. So I used to be in the same uniform as General Davis, and the last thing as a commander you want to do is have things sitting around your base that you do not need anymore. Ms. Kaptur. Do you have an estimate of the numbers of those weapons that will be dismantled? Mr. Klotz. We would have to tell you the specific numbers in a different setting. We would be happy to do that. Ms. Kaptur. Thank you. Mr. Klotz. Yes, we do have a chart that lays all that out. So we will share that with you. Ms. Kaptur. Thank you. And just one other question on domestic uranium enrichment, General. Your fiscal year 2016 budget request included $100 million to continue operating uranium enrichment centrifuges that were constructed as part of a joint demonstration with the United States Enrichment Corporation, or USEC, now known as CENTRUS. You now do not believe that this effort is worth supporting, so I have three little questions. What changed in the intervening year, when will we require a domestic capability for tritium needs, and thirdly, I understand that given the time horizon you are now considering you may look at technologies beyond ACP to achieve a domestic enrichment capability. How will you make a determination on which technology to use? Mr. Klotz. Thank you for the question. And if I forget to answer one of them, please remind me. Ms. Kaptur. First, what changed in the intervening year? You now believe that the effort is not worth supporting. Mr. Klotz. Well, there is a number of things that were done over the past several years. one, in accordance with congressional direction, and also direction within the executive branch interagency, we embarked upon a very serious accounting of the current and future availability of low- enriched uranium, highly enriched uranium, and tritium to meet our defense needs. We also took a look at analysis of the various types of technology there were to produce all three of these commodities. And then we also took a look at the preliminary cost and schedule estimates of what it would take to build--the Secretary referred to it this morning--as a national security train of centrifuges at Piketon. One of the things that was revealed as we did this inventory of uranium is we were able to find additional uranium that could be used to meet our defense needs, whether it is in the production of tritium or for Naval Reactors or for the weapons program. So the need that we had-- -- Mr. Simpson. Would the Ranking Member yield for just a second? Ms. Kaptur. I would be very happy to. Mr. Simpson. When you say you were able to find extra amounts of this material, is this just laying around? Don't we keep track of this? Mr. Klotz. Yes. There are various types of uranium that are in a form which might not be readily usable in the way in which we have traditionally done it. For instance, leftover materials that we are using at Y-12, if you are doing a cost analysis of whether you want to build a whole capability enriched uranium, or invest the money in taking this uranium that might otherwise have been uneconomical to use for these purposes, the cost curves drive you to the point it might be less expensive to develop the capability to use that uranium. Mr. Simpson. So it is not that you found this uranium in the back of the shed---- Mr. Klotz. No, sir. Mr. Simpson [continuing]. That you did not know was there? Mr. Klotz. No, sir. Mr. Simpson. Okay. Mr. Klotz. And so there is cost associated with that. And in the out years, we will show those costs of what it takes to develop that uranium and downblend it for the purposes that we need to use it for. So in any event, given the fact that the need for this uranium--or the need for it to have to use or develop a capability of using only U.S. technology to enrich uranium got pushed out to roughly 2040. So we used the cascade, the 100-120 large centrifuges that were in Piketon, for several years to basically do a proof of concept to do the research and development for these large centrifuges which are there. In our assessment, we have now obtained all the data that we need on how to at this point from the facility at Piketon. There is still work that we will continue to do on the large centrifuges at Oak Ridge in Tennessee and the K1600 facility that is there, another facility located in Oak Ridge. And we feel that will allow us to continue to learn what we need to learn until such time as we need to build out a large national security train to do domestic uranium enrichment with U.S. only technology. In the meantime, we have also---- Ms. Kaptur. You are saying it is after 2040? Mr. Klotz. That is when we will have the need for that, so we would have to--and I would have to get you the specific dates when we would have to start thinking about developing that. And you are right, now that we have the opportunity to do that we also want to consider the possibility of using smaller centrifuges to get to the same objective. And we will do that work at Oak Ridge as well. Ms. Kaptur. Thank you, Mr. Chairman. Mr. Simpson. Mr. Fleischmann. Mr. Fleischmann. Thank you, Mr. Chairman. And I want to thank each and every one of the witnesses for being here today and for your outstanding service to our great Nation. General Klotz, it is always good to see you, sir. Before I begin my questions I do think congratulations are in order for the entire NNSA team. It was reported I believe last week that the completion of the dismantlement of the retired W69 warhead at Y-12 is complete. Thank you very much. That is the way it is supposed to work. My first question to you is usually about the same subject, this Uranium Processing Facility. The UPF at Y-12 is obviously very important to me and I think to our country and its national defense. Will you please give an update on the status of the design process and any details that you can give us on the status of the project as we ramp up for construction? And, specifically, what do you plan to accomplish in fiscal year 2017, sir? Mr. Klotz. Thank you very much. And I think the Secretary showed you a chart this morning in the course of the hearing which lays out, I think, in great detail the approach that we are taking for constructing a uranium processing facility, the objective of which is to get us out of Building 9212, which you visited many times, sir, at the Y-12 complex by the year 2025 at a cost cap of $6.5 billion. So what we have done, again, at one point we were thinking about building a big box to house everything that was in that facility and move it in. And as a result of ideas that were conceived in the NNSA and DOE and thoroughly studied by a red team, chaired by Dr. Thom Mason, who is the director of Oak Ridge National Laboratory, we have now come up with what is known as the modular approach, where we are segregating various activities that need to be performed to process uranium by hazard category and by security category, placing them in different buildings. And of course, there is a different cost structure associated with the level of security and the level of safety that you have to achieve. The first subproject under the redesigned approach was called the Site Readiness subproject. I had the great pleasure of joining you when we cut the ribbon on the completion of that last year. Again, as I said in my opening statement, under budget and on time. We are now in the midst of work related to the site infrastructure and services subproject, which will continue to prepare us for the actual construction of the UPF facility once we are ready to do that. The project is actually under way, will cost about $78 million, and we expect to complete that in April of 2018. So a lot of the work in 2017 will be devoted to that. We are also continuing the process of the design for the three main facilities, two of which are nuclear facilities, the mechanical and electrical building, the salvage and accountability building, and the main process building. So that will also continue over the course of the next several years. And we will also be getting ready to do the next two major subprojects, one called Electrical Substation and also one called Site Preparation and Long Lead Procurement. Mr. Fleischmann. Thank you, sir. I would like to ask you a question about high-risk facilities. I was pleased to see that NNSA's budget request increased funding for the high-risk excess facilities. Would you please explain what can be accomplished over the next few years, especially and specifically at Alpha 5, at Y- 12, described as the worst of the worst? Mr. Klotz. Well, one of the things that we do have in this budget, Congressman, is we put in some additional funding to ensure the safety and security of Alpha 5 as well as Beta 4, two major facilities at Y-12 which are no longer in use. However, they still exist. Our employees have to go in there from time to time to make sure that they are safe and secure and there are risks associated with them doing that, risks from fire, contamination, water intrusion, and so on. So we had asked for additional money in this particular budget specifically going to carry out a very structured, disciplined approach to making sure that we have done the work that is necessary to sustain those buildings for the long-term. As I think the Secretary testified this morning, one of his directives that we are carrying out, not only at NNSA, but at the other parts of the DOE, is to arrest the growth of deferred maintenance. One of the things I learned in my time in the military is in an era of constrained budgets, the first dollar will always go to mission and to people. And the dollars that are necessary to sustain infrastructure, to do repairs, whether it is roads or facilities, always gets pushed to the right; it gets deferred. And there is a tendency to want to take risk in that area. Well, at some point you can only take risk for so long until you get to a tipping point, and literally, at places like Y-12, the ceiling starts to cave in which will shut down operations for extended periods of time. So with the support of the Congress, last year in the 2016 enacted budget, we were able to basically hold the level of growth in NNSA's deferred maintenance to level. And then there will be a slight downturn in the overall level of deferred maintenance which quite frankly right now is at $3.7 billion for the NNSA. Mr. Fleischmann. Thank you. Mr. Chairman, I will yield back to round two. Mr. Simpson. Mr. Frelinghuysen. Mr. Frelinghuysen. Gentleman and Miss Harrington, we had Secretary Mabus in this morning and Admiral Richardson, CNO, and so I would like to get some sort of updates on your characterization of where we stand, Admiral Caldwell, with the OHIO-class subs. This Committee makes substantial investments, and obviously they are matched on the Department of Defense side. Where are we? Admiral Caldwell. Yes, sir. First off, sir, thanks for the question and thanks for the great support that Naval Reactors has enjoyed from this subcommittee. It has enabled us to be successful and it will be important to our future success. My responsibility for OHIO-Class replacement is the design and the way ahead in the engine room and the reactor plants. The simple answer is we are on a great track. We are on track to support the Navy's goals. And the Navy's goals are to start construction of that national asset in 2021, to complete that construction in 2028, and send that ship to sea in 2031. Now that is a fairly aggressive timeline for construction. We are building a ship that is about two and a half times the size of Virginia, and we are going to do it in seven years, the same time span to build the first VIRGINIA-class submarine. On the Naval Reactors side, this year and with the support of the subcommittee's past support to us, we are moving forward on the system component and equipment designs, and final designs that will allow us to do heavy equipment procurement in fiscal year 2019. Two other big portions in this are the development of the electric drive system, which we will get to a full-scale testing at the end of fiscal year 2017. That will be a very important milestone. And then the other big component in OHIO- Class replacement is the life of the ship fuel. That ship will be loaded with fuel once and will last over 40 years without ever refueling. And we are on a great track to do that and start manufacturing the core in about fiscal year 2019. And it will take about five years to develop that core. So, again, thanks to your success we are on a great path to meet the Navy's timeline and our fiscal year 2017 budget submission allows us to continue that path. Mr. Frelinghuysen. This Committee under Chairman Simpson, and certainly on the defense side, we are supportive, but there are some pretty extraordinary costs involved here. How do you stay on top of some of those costs and what is the estimate for the first OHIO-class Replacement sub? It is pretty high. Admiral Caldwell. Well, the first will be on the order of about $9 billion and follow up about $5 billion. Those figures are being, you know, looked at closely. In regards to the design work that I am responsible for, the total bill is about $1.7 billion on the DOE side, and that enables me to do all of this design that gets the electric drive to provide the stealth that we need to operate this class out into 2080, and allows us to do the detailed design work to develop this life of the ship core. That is not a trivial undertaking. But we are on an excellent path with periodic program updates to meet. My staff is out providing the regulatory oversight and the management oversight to make sure that these projects are on track. We are very involved. And I think, again, thanks to the support of the Committee, the fiscal year 2017 budget is going to allow us to continue that. So we are exactly where we need to be on the Naval Reactors side. Mr. Frelinghuysen. A few years ago--and I do not include you in the group--people were rather dismissive of what the Russians are doing and the Chinese are doing, like whatever they had in the way of subs could never match our capabilities. But in reality we find in open sources Russians ginning up their game. They have, you know, some pretty extraordinary capabilities. I assume the Chinese are not slowing down their building of subs, both nuclear and diesel. Any observations besides, obviously, the Navy's view that you will always have overwhelming superiority? Is there any recognition, especially since we made two VIRGINIA subs every year? We want to continue that. But the end product we are looking at in terms of the replacement, whether that will be a match for the future, for future situations. Admiral Caldwell. A couple of thoughts on that, sir. First off, I think what you are seeing in Russia and China is the understanding that a Navy brings value to their national interest, a strong Navy in particular. And they have also seen the advantage of an undersea Navy. You see Russia developing highly capable submarines in smaller numbers, and you have certainly seen China develop larger numbers of submarines. Our responsibility in the Navy is to understand the capabilities that are out there in the world and to make sure that our capabilities are overmatched, or that we overmatch that capability. And I think we are on a great path to do that with the VIRGINIA-class submarines and the ability to modernize those throughout their life. The OHIO-Class replacement design was undertaken with understanding the challenges that she will face over her life, including stealth weapons requirements, the reliability, the endurance, all of those things factored in. And, again, I think we are on a great path to deliver exactly what the Nation needs on schedule. Mr. Frelinghuysen. Thank you for exuding that confidence. Maybe just put in a plug, I understand that the Washington Carrier group is out there on maneuvers. Is that right? Was that the aircraft carrier we were going to retire? So now it is up and running? Admiral Caldwell. It is back on the East Coast, sir, and it will be refueled starting next year. We were able to, due to some great work with support by our DOE labs, and Naval Reactors which enabled a carrier swap that positioned the Ronald Reagan as the forward deployed carrier in Japan. Mr. Frelinghuysen. We have got to get moving on the forward too. Thank you. Admiral Caldwell. And we already are, sir. Mr. Frelinghuysen. Okay, good. Thank you, Mr. Chairman. Mr. Simpson. I hate to do this, but we have nine minutes to vote. We have started actually trying to constrain it to the time allowed so the first vote doesn't go on for 45 minutes. So we are going to have to leave for just a minute, if you could stay around. I think we have two votes, is that right? We have two votes and will be back right after that. I would encourage Members to come back as soon after that second vote as we can so that we don't have these ladies and gentlemen sitting around all day when they have important work to do. We will be recessed for a few minutes. [Recess.] Mr. Simpson. We will be back in order. Representative Roybal-Allard. Ms. Roybal-Allard. Deputy Administrator Harrington, last year you spoke to the merits of the Nuclear Smuggling Detection and Deterrence program, which is at the core of our strategy to deter, detect, and interdict illicit international trafficking in special nuclear and other radioactive materials. In the fiscal year 2016 budget hearing you explained that the reason for the roughly 6 percent decrease in a funding cut from fiscal year 2015 was due to the success of the program and the ability for our partners to be self-sustainable and take responsibility of their own operations and maintenance. This year's request is nearly level to the fiscal year 2016 enacted level even as there have been reported cases of radiological material going missing in recent years, including most recently in Iraq. Are you confident that the current funding levels will reinforce our global nuclear security infrastructure in the face of today's threats? And how does the NNSA help ensure that its self-sustainable partners are preserving the high standard for detecting radioactive materials that the NNSA holds? Ms. Harrington. Thank you very much for your question. Yes, the Nuclear Smuggling Detection and Deterrence program is key to our counter-nuclear smuggling efforts. We have a high degree of confidence in the capabilities of the program, in part because we continually are reviewing and realigning where necessary. We have gone through two strategic reviews in the last 4 years. And one of the conclusions from those reviews is that depending on the geographic and other considerations that we have to take into account, diversifying the technologies, not just the fixed detectors, but mobile vans, backpacks, handheld detectors, have to be designed as part of an overall suite of capabilities. Included in that suite of capabilities is our collaboration with both the law enforcement communities in the countries where we work as well as intelligence communities, all of which contribute to a multilayered defense. You talked about sustainability. That is absolutely key and, if anything, it is the dog and not the tail of this whole effort because it is the ongoing commitment with each of these countries, their ability to work effectively with their neighbors and within their regions that actually builds the global ring of security. So we pay a great deal of attention to that. And what we never intend to do is simply build a capability and then drop it and walk away. We build networks to sustain professional interaction among these capabilities and to provide continuing education, if you will, training, and updating, both of skills and equipment. We are moving more into doing a variety of tabletop and field exercises to really push the limits even more. I hope that answers your question. Ms. Roybal-Allard. How do you prioritize which countries to work with and what sorts of factors do you look at when considering new partnerships? And what new countries do you expect to partner with in fiscal year 2017? Ms. Harrington. So the prioritization of countries I can speak about generally, but as you surely appreciate, a number of our considerations would be classified, but we could give you a more detailed briefing on what some of those considerations are. Clearly, the presence of established smuggling routes, the presence of nuclear and radiological materials, the stability of the country or regions in which we see these materials, and other elements are part of a package of considerations that we take into account in our selection process. Ms. Roybal-Allard. Okay, thank you. Administrator Klotz, the Stewardship Science Academic Alliances Program and the site stewardship Minority Serving Institutions Partnerships Program were consolidated into one program in fiscal year 2016. This action was taken to improve the effectiveness of these programs and to encourage additional partnerships among minority-serving institutions. Can you please provide an update on how this restructuring is doing, how the program is specifically working with Hispanic-serving institutions to get the next generation of Hispanic youth excited about the STEM fields, and if you have seen an increase in the partnerships of minority serving institutions? Mr. Klotz. Thank you very much for that question and let me take the specific response in terms of the numbers for the record, if I could. But just let me underline just how important it is to us in the areas in which we have reached out in all regions of the United States to bring minority serving institutes into our programs for internships, for small activities, but also support to various academic institutions in building curriculum and providing scholarships and work opportunities for people in minority serving institutes. Just last year, we developed a program for training students from minority serving institutes, largely in the Southeast United States for cybersecurity, which we think is going to be one of the most important fields not only for NNSA and for the Department of Energy, but also for the government and commercial operations in general. Everywhere I go I make a point when I visit our sites to meet with the people who support those programs and it is something we are absolutely committed to. Ms. Roybal-Allard. Do I have time for another question? Mr. Simpson. Yes. Ms. Roybal-Allard. NNSA's Radiological Security subprogram works to secure certain radioactive sealed sources located in soft target sites such as hospital or universities. And this work reduces the risk of terrorists acquiring radioactive material that could be used to make a dirty bomb. The NNSA states that fiscal year 2016 funding will be used to complete security upgrades for 95 domestic buildings containing radiological material. For fiscal year 2017 your budget request includes funding for only 45 buildings. There are 225 additional buildings planned to complete security upgrades between fiscal year 2018 and 2021. Why does the funding request include only 45 buildings and how do you plan to complete the 225 remaining requests between fiscal year 2018 and 2021? Ms. Harrington. Thank you. So, radiological security is a high priority for us. The schedule that we have is one that we believe is realistic and what we need to emphasize is that all of these buildings in the United States meet Nuclear Regulatory Commission requirements for licensing these sources in the first place. So this is an augmentation above and beyond those baseline commitments. Part of the shift in funding is an increase in the amount of funding that we are putting into what we call our alternative technologies program. And this is a pathway to permanent risk reduction because there are alternative technologies available, for example blood irradiators are often found in hospitals and other organizations and could be replaced by x-ray-based technology, so you do not even have to have the source in the facility in the first place. So we are trying to encourage both new technology development as well as greater utilization of existing technologies to eliminate some of these classes of radiological sources altogether. Ms. Roybal-Allard. Thank you. Mr. Simpson. Mr. Valadao. Mr. Valadao. Thank you, Chairman. Thank you for your time today. I have a couple of questions. Ms. Harrington, negotiations on the Joint Comprehensive Plan of Action, JCPOA, have concluded and the Department of Energy is expected to play some kind of role in implementing a program. However, your responsibilities for implementation are unclear. Is there any funding in your budget request to support the nuclear agreement with Iran? I'm asking the wrong person the question, I'm assuming. And, B, what is the role of DOE going forward and why should Congress support these particular DOE activities? Mr. Klotz. Thank you for that question. It is an extraordinarily good question. And I believe, as Secretary Moniz testified this morning, there are a number of ways in which the Department of Energy and NNSA are associated with the Joint Comprehensive Plan of Action. Probably the most important way in which we are involved is our continuing close relationship with the International Atomic Energy Agency, which is headquartered in Vienna. As you know, under the JCPOA they have the lion's share of the responsibility for monitoring Iranian compliance with every provision of that agreement. As I said, we have a long association with them. We provide training to their inspectors. In fact, as the Secretary mentioned this morning, every IAEA inspector since 1980 has taken a course in nuclear material measurement at Los Alamos Laboratory in addition to professional continuing education and a whole host of areas. We also provide technology, electronic seals, tamperproof cameras. There is also a piece of equipment that is being deployed for the first time in Iran as part of the JCPOA called the OLEM, the Online Enrichment Monitor, which you can fit around a pipe and actually measure the enrichment level of uranium gas which is flowing through that pipe to ensure that it is not being enriched beyond the levels that are permitted under the JCPOA. In terms of specific additions to the budget, for the NNSA budget, in addition to that work which we continue to do anyway in international safeguards, there is an additional 13 million that we are requesting. That will largely go to pay salary and travel for those people who are involved in the redesign of the ARAK reactor, A-R-A-K reactor, to ensure that it meets our nonproliferation goals and cannot be used to produce plutonium, and that we also have some additional work in other areas. Mr. Valadao. I am glad you brought up the IAEA. The Government Accountability Office recently released a report that states the International Atomic Energy Agency, the IAEA, the agency responsible for verifying and reporting back to the international community on Iran's compliance, the quote is, ``faces an inherent challenge to detecting undeclared nuclear materials and activities.'' Do you believe the verification measures that exist will be sufficient for the IAEA to monitor compliance with the agreement? And what will be the greatest challenges, and are there any opportunities to improve the limitations of current nuclear verification techniques? Mr. Klotz. I do believe that the verification measures that have been put in place through the JCPOA are absolutely right for the agreement. And, in fact, to be perfectly honest, when we came out with the agreement, many of us were very surprised and very impressed with the level of verification that was written into that particular agreement. It goes well beyond any other agreement that we have struck with the IAEA has. As the Secretary mentioned this morning, we essentially will monitor every aspect of the Iranian fuel cycle from the mining and milling of uranium all the way to its disposition in the end. If there is diversion of material to other uses, that is how it will become obvious when you see that in how the fuel cycle flows beyond onsite inspections, beyond all the technological monitoring that we talked about. Again, as the Secretary said, it is always a challenge to find those areas which are at undeclared facilities in large, open spaces. We also have very capable American and allied intelligence capabilities that will also be paying attention to that. Mr. Valadao. And just one more on cybersecurity. Mr. Administrator, as you know, the Department of Energy has experienced a number of data breaches in the past. The data breach last summer which involved files held by the Office of Personnel Management was a huge failure for the Federal Government. The performance measures in your budget request consistently say the cyber program is effective. What are you doing to protect employees and obviously, most importantly, our national security information? Do you believe that the measures put in place thus far are sufficient? Mr. Klotz. This is one of the greatest challenges I think the Federal Government faces, whether it is on the executive branch or the legislative branch, and also commercial industry faces, and that is maintaining the security of its cyber networks and its databases. It seems like we always have to work to get one step ahead of what the state of the art is for those who would try and penetrate our systems. We take this very, very seriously, one for the protection of our people and their personal identifying information, to guard against the risk of that being compromised and leading to identity theft, but also we guard some of the most important secrets that the U.S. Government has in the nuclear area. So there is always more that can be done. Mr. Valadao. Thank you. Thank you, Chairman. Mr. Klotz. I might add to that, if I could, one of the initiatives that Anne Harrington, I think, has actually spearheaded both for the U.S. Government and the international community is to draw that connection between the physical protection of nuclear facilities, including civil nuclear plants, and protecting their vulnerability to cyberattack. And she has led the charge in getting that onto the international agenda of concerns. Mr. Simpson. Mr. Fortenberry. Mr. Fortenberry. Thank you, Mr. Chairman, good afternoon. I want to return to some of the questioning that I had interacted with and posed to the Secretary this morning regarding just the architecture of our nonproliferation efforts. You have a slight decrease in the budget. I need to hear some explanation for that please but more than that, is the current construct, the current ecosystem multiagency effort to share information, to think critically, to project out what the emerging threats will be in this regard so that we are all working toward increasing the probability as close to zero as possible of some incident in this regard? Are those efforts ongoing? The Secretary and I, as well as the chairman had spoken about following up to the March report, perhaps with you in another setting to review some of the finer points in that regard but in terms of generalities, is the current ecosystem of nonproliferation, the cross-agency cooperation, our ability to think critically about emerging trends in this regard? Are we doing enough? Are we safe? To me, everything else that we are doing in the building is inconsequential if we do not get this right, frankly. Mr. Klotz. Thank you and I did watch with rapt attention through the miracle of modern communication technology this morning and of course, we cannot hold a candle to the Secretary in articulating in a clear, concise and compelling way this but let me try. On the issue of interagency coordination and you and I have discussed this before and we certainly need to have additional discussions. I think at the moment, my personal view is that we have very good interaction at the interagency level between the various agencies which are responsible for nonproliferation. DOE, State Department, Homeland Security, the Intelligence Committee, the Department of Defense coordinated by the National Security Council which is, by the 1947 law, that is their responsibility to do that. But I think there is also something that is unique about the current situation. The President made a speech in 2009 in which he clearly stated that securing nuclear materials and dealing with the threat of nuclear proliferation and the threat of nuclear terrorism was a national priority. That sort of galvanizing guidance, I think, has seized all of us who work in this particular area so we know we should and we can work together on that. In terms of setting up formal structures, I have often thought that communities of interest in which people are drawn together because they share a common goal, a common objective, or a common need to pool resources is one of the greatest motivators in terms of making people work together. Did you have any---- Ms. Harrington. I would just add very briefly that not only do we have a very vibrant interagency process, and one that I would have to say works. I was recently involved in an issue that in fact involved two separate interagency policy groups and so the White House said: ``This is silly, everybody get together in one room. Let's figure out whether we can come to consensus.'' We came to the consensus at the Assistant Secretary level which means that we do not have to now bother all the deputies and principals with a decision because we were able to broker that at our level and that really is the point, to get that engine going and real communication on substantive issues, but we also work individually. For example, the Defense Threat Reduction Agency has been a long time partner of ours. Ken Myers will be retiring soon, stepping down as the director of that agency. He was in my office yesterday so that we could, as our last act together, sign an MOU between our two organizations on how they will work together into the future and coordinate specifically. Mr. Fortenberry. Let me ask you this, one of the challenges of holding a congressional seat, of being in public office and yours as well is to take the legacy of what has been done and try to retranslate it in order to meet emerging needs, creativity, entrepreneurship. Have there been gaps identified in the current construct of our nonproliferation efforts, as they exist across basically six agencies or are there duplications that, you referenced one there, that do not make sense that can be informally addressed? This is what I worry about and again, I look forward into going deeper into the report that you have appropriately issued last year and that may better answer, but to the degree that you can address this, I would appreciate it. Ms. Harrington. Well I think that one of the issues that we would like to come back, for example, and discuss more is emerging technologies and some of the other things that we believe we have to be prepared to meet flexibly and responsibly in the future. Mr. Fortenberry. Yes, there are enrichment technologies, for instance, that are emerging that would make this quite simpler than the vast infrastructure that is now required and things of this type is exactly what I am talking about. Ms. Harrington. Correct. Mr. Klotz. Additive manufacturing is another area that both has enormous promise for allowing us to do a lot of our activities less expensively, faster, by cutting down how long it takes to develop a prototype, but by the same token, there is another side of that coin which we can discuss when we get together. Mr. Fortenberry. The Secretary proposed, and I gave this example, that with the advent and the movement towards small modular reactors that this technology is suddenly smaller, scalable, duplicatable more readily. Now he, you know how he is, he is very respectful and polite and he countered the argument by suggesting that that actually takes away the need for advanced enrichment capabilities that could be diverted toward more improper purposes but nonetheless, it is the broader problem of advancing technology without there being any singular controlling entity, I think leaves us vulnerable. Ms. Harrington. I was actually really happy that you raised that question. Mr. Fortenberry. Oh, good. Ms. Harrington. Because we have a very close working relationship with the Nuclear Energy Office, which, as you know, has the lead for advancing small modular reactor competitiveness and design in the United States so in 2014, we sat down and looked at these reactors and said: ``Well that is great, but why do we not do a study on the implications for safeguards and security of these new designs?'' And so we have that study and we would be happy to share it with you and the good news out of the study is that it does not create additional problems compared to existing reactors and in some cases, particularly for the models that are intended for placement underground, subsurface designs, it actually adds to the security so we would be happy to---- Mr. Fortenberry. Yes, please. Ms. Harrington. But we tried to, within the Department, to bring all those streams together and do the thinking as a group. Mr. Fortenberry. One more quick question, Mr. Chairman. In that regard, who drives that narrative? You rightly pointed out the President's projection of policy, his vision and I completely agree. In fact, I was one of about 15 members who were invited to the White House very early on, we all rode on a bus and we could not figure out what was the binding narrative between us because it was people from all types of philosophical dispositions. We finally figured it out, in fact Senator Markey told me because he was on the bus, that this is everyone who voted against the India Civil Nuclear Trade Deal so there was only a handful of us. So I want to commend the President for this because this was important work to reestablish this ideal for the international community that at least gathering loose, unsecured material was something that we could all do and then it is a gateway to the broader considerations about nuclear security worldwide. But in terms of specific emerging technology and who drives the culture of the policy discussion on that? Do you do it? Does the National Security Council do it? Does it happen organically, informally? Is there a hierarchy of process here? I am curious so--should I do it? Mr. Klotz. The answer to all of that is yes, all of the above. It is a community of interest; there truly is a community of interest that involves not just those agencies of which we are a part of that have an abiding interest in these issues. It involves interested members of Congress and their staff. It involves the Non-Governmental Organizations, the NGOs, some of whom are sitting here who drive the thinking, the thoughts, the ideas forward in ways in which we can make the world a safer place with respect to nuclear proliferation and terrorism. Mr. Fortenberry. And you are satisfied that that collaborative process, without a strict hierarchy, if you will, actually is the right, proper, robust mechanism by which the spectrum of emerging threats or the ability to think constructively and creatively about what we are doing that is leaving us potentially vulnerable, what could be updated, what could be let go of, what could be created is actually occurring, you are confident with this process? Ms. Harrington. Yes. Mr. Fortenberry. All right, thank you. Mr. Simpson. Before I forget, could you get a copy of that report to all the members of the Committee? Mr. Klotz. This report here? Mr. Simpson. Yes, sir. Mr. Klotz. Yes, sir. I am happy to do that. Mr. Simpson. Thank you. Admiral Caldwell, your budget request reports that the Legacy Spending Fuel Facility will have to operate for another 5 to 12 years after the new facility comes online in order to provide spending fuel examination capabilities. Why were the examination capabilities not included in the design of the new facility? Naval Reactors was working with the Office of Nuclear Energy on a partnership for the new spent fuel examination facility, those plans have not been advanced. What is the status of this effort and could a joint project meet the needs of both programs? Admiral Caldwell. I will answer the first part, sir, and then I might come back to just drill in a little bit on the second one so that I am clearly answering your question. The Spent Fuel Handling Project is designed to replace a 55-year- old facility in the extended core facility that is out in Idaho. That facility is aging, it has some infrastructure challenges there. It could limit our ability to do what the Navy needs in terms of receiving, packaging, and interim storage of spent fuel and additionally, it cannot accommodate the longer fuel that we processed that comes out of the NIMITZ- Class carriers so we are on a steady drumbeat of refueling the NIMITZ-Class carriers so that they can get out to their roughly 50 year lifetime. So we have been trying to do this for a number of years but due to budget shortfalls, we were never able to undertake it. Now thanks to the support of this subcommittee, we have been able to move out on the plan to recapitalize that expended core facility and we decided to do that in phases. The phasing was necessary to fit within the budget constraints that we had to deal with. I think it is important also to understand that there are several aspects of work that go on at the expended core facility today. One is that receipt, handling and packaging of spent naval fuel for interim storage. The other is to take expended cores from reactor plants and go do analysis. That analysis is very important because it allows us to prove and understand whether all of our design considerations play out exactly the way we wanted them to. We learned a lot essentially. We also do examinations of materials that are tested in the advanced test reactor. We have materials that we want to use in future cores. We eradiate them in a flux reactor and we analyze what happens to those and that allows us to build things for the future. A great example there is the OHIO-Class replacement fuel. All of that research and study is validated by what happens and what we see in those test samples so the bottom line, sir, is that we approach this in a phased approach and the phase most important to us is to be able to process this NIMITZ-Class fuel because we did not want to impact the Navy's ability to operate the fleet. We had to be able to bring the carriers in, offload the fuel and through a steady drumbeat, bring that fuel out and process it so we are on a path to recapitalize just that one aspect of it first, the spent fuel handling, and now we will go, we will start the construction in 2019 and we will start doing the operations with that longer fuel from the NIMITZ- Class in 2024 and then we are also working on the next phases of this to go recapitalize those expended core analyses and also the work that we need to do in hot cells and the work that we need to do to examine samples that we test in the advanced test reactor. So that is a fairly complicated set of things that we have to do but the spent fuel handling is only one phase of it and we are on a path to do that. Now your other question I believe was is there a partnership and I think you mentioned the INL. I just want to make sure that I understand that before I launch off on an answer. Mr. Simpson. You were looking at one time with the Office of Nuclear Energy on a partnership for a new spent fuel examination facility, but those plans seem to have not progressed. Admiral Caldwell. Well, what we did, sir, we looked at what other facilities were around which included some of the facilities out at the INL and fundamentally, when we got done with it and doing the analysis of different courses of action, this was the best course of action for us, because there would be too many modifications required to existing facilities. Mr. Simpson. And that goes to the difference in fuel? Admiral Caldwell. The difference in fuel, the difference in terms of the amount of things that we have to process. There is a lot that goes into it and the existing facilities just could not do what we needed to do in terms of production capacity and so this is the best course based on the budget that we had and based on the outcome we needed to be able to service the Navy's needs. Mr. Simpson. Okay. Naval Reactors continues to spend approximately $130 million per year, approximately 30 percent of your infrastructure budget on the spent fuel management program. The Idaho Settlement Agreement requires Naval Reactors to transfer all of its spent fuel to dry storage by 2023 and to move all spent fuel out of the State by 2035. Since DOE's overall spent fuel strategy is no longer valid, it has changed substantially over the years and the State seems supportive of Nuclear Reactors continued presence, there may be value in updating the agreement between the State of Idaho and the Navy sooner rather than later. What are your plans or do you have plans to approach the State of Idaho about renegotiation of the settlement agreement. Admiral Caldwell. First off, Mr. Chairman, we are in-- everything that I can control within my program is tracking to meet our agreement with the State of Idaho. Mr. Simpson. But it is what you cannot control. Admiral Caldwell. That's right, sir, the challenge is the National Repository for spent fuel and therein lies the challenge. We have a program now that takes our spent fuel, prepares it and packages it and puts it in interim dry storage which is safe and secure. Also, we are in close discussions, at various times throughout the year, reporting to the governor and the State of Idaho that we are meeting our responsibilities in terms of our agreement. We are going to have to just keep working on that as we go forward. At the same time, I think the Nation needs to deal with how we are going to handle this spent fuel and until we get there, my responsibility is to do that work safely. If you approve my budget request the money that you are giving me in fiscal year 17 will allow me to do what I need to do safely to store that in an interim manner, while we try to figure out how we are going to go in the long run. Mr. Simpson. Well, I appreciate that. To tell you the truth, I think that the people of Idaho are very supportive of what Naval Reactors is doing and I do not hear any complaints, and frankly, that is kind of unusual in my line of work and in yours probably. Admiral Caldwell. Sir, no doubt we get great support from the State of Idaho and we are very thankful for that and we aim to keep it that way. Mr. Simpson. Well, you do a good job out there and we appreciate that, but at some point and time, this settlement agreement that was done, I cannot remember how many years ago, 1995---- Admiral Caldwell. 1995. Mr. Simpson. So it is what now? Twenty years old, 21 years old? Who knows what the future is going to be 20 years from now, you know what I mean? You do the best you can and circumstances change and at some point in time, the State of Idaho, and I suspect all of the States that have had agreements with DOE that are older, are going to have to sit down and say, ``Okay, now what do circumstances require that we do and still meet the demands of the State and the needs of the Federal Government and the Navy and others?'' And that is always a tough thing to do because the people in Idaho are insisting that we follow the governor's agreement to the letter of the law. They are the ones who took the governor to court trying to overturn that agreement to start with, and now they insist that we follow it to the letter and we are down the road 20 years and circumstances have changed; that is the reality. We know they will change over the next 20 years, but I appreciate the work that you have done out in Idaho and you do a great job and we look forward to working with you and to complete your mission. General Davis, the GAO previously found that because NNSA took an extended period of time to prepare a valid cost estimate for the B-61 Life Extension Program, that life extension program now has a little margin in the schedule left to ensure the U.S. commitments to NATO will be met. The new scope for the W-88 refurbishment was approved by the Nuclear Weapons Council in November 2014 and the Subcommittee still has not been provided the cost estimate. What improvements have been made to the way that you estimate life extension programs? Why has it taken so long to prepare a valid cost estimate for the W 88 and will the extended time it has taken to verify the cost have an impact on the refurbishment schedule? And do you anticipate the W 88 cost to rise significantly above the original cost estimates of $.4 billion. General Davis. Thanks for that question, Congressman. First, with regard to the B61-12, that program is currently completing its last year of full-scale engineering and development and we are on schedule and on budget to produce our first production unit in March 2020. This year was a good year for the B61-12. We conducted three drop tests and we also did compatibility testing with the F15, F16, B-2, and F35. In fact, I was able to actually witness the first full-scale integration test of the B61-12 out in Tonapah and it went very well and while I cannot get into specifics, I will tell you that right now we are very happy with where that program is as is the Air Force so that is with the B61-12. With regard to the W88, essentially through our surveillance program, we identified an issue with the conventional high explosive where it was not aging as we expected to. In order to make sure that that weapon continued to meet its military requirements, we made the decision, working through the Nuclear Weapons Council that we need to replace that conventional high explosive. Obviously that was something that just happened in the last about a year. Going through our discipline process, we will come up with a new cost estimate, our first cost estimate for that program in September of this year and then we will match up the existing Alt 370 Program, which was working to put a new arming, fusing, and firing capability into that weapon along with the conventional high explosive refresh and we will match up those programs in March of 2017 in Phase 6.4 which is our production engineering. Mr. Simpson. In order to make sure that a more affordable design that meets military requirements was not overlooked, the fiscal year 2016 Committee directed the NNSA to conduct an independent validation of the alternatives. The NNSA selected for the long-range standoff warhead which is in the early stages of development. When do you expect the results of that independent validation to be available? How many alternatives did you consider? And were there any that were less expensive than the preferred alternative you are now developing? And do you believe that the process the NNSA uses to analyze refurbishment alternatives is mature and comprehensive? General Davis. Sir, with regard to the legislation, it actually asked us to have a JASON-like organization take a look at that. We approached the JASONs, they did not feel like this work was in their wheelhouse so they directed us to some other folks. We are currently in conversations with the MITRE Corporation to perform that analysis for us. We expect that to being hopefully later this summer. In terms of the program, I think we, over the last several years, have put a lot of discipline into it. When NNSA first stood up, the real issue that they had was to figure out how to do this stockpile stewardship program. How do we do the hard science to make sure that the stockpile is working as it is supposed to without having to run testing. Our first life extension program was the W76 which is now just over 60 percent complete so we are now taking that same rigor that we put into the science part of NNSA and we are putting it to the program management part. To that end, we recently hired, although we have not announced the candidate yet, a program executive officer that will oversee all of our life extension programs to continue to bring rigor to that process. Mr. Simpson. Thank you, and thanks for the work that you do in all of this. I know it is very complicated and important work. Ann, your budget request and there are many people on the floor who will look at a budget and that is the determination of your commitment to a particular subject matter. Your budget request is down, how much was it, $132 million from last year. That means $132 million less commitment to nonproliferation, according to some people. Mr. Simpson. Tell me why it is down, why the request is down, and what the implications of that are in terms of nonproliferation so that we can answer those questions on the floor. Ms. Harrington. Okay, thank you. The fact that we have dropped a few percentage points in the amount of money in the budget does not reflect at all any less commitment to nonproliferation by the Secretary, by the Administrator, by me, or anybody else in the organization. But, as you know, we have proposed a different path forward for the Mixed Oxide Fuel Fabrication Facility in South Carolina, a dilute disposed option. Mr. Simpson. I think I may have heard something about that this morning. Ms. Harrington. I would be surprised if you did not, but that is a difference of $70 million right there. And then trying to be good custodians of our budget, we have some prior year funds, which we have not been able to spend out as quickly as we had hoped. In our line of business, a lot depends on your foreign partners and their ability to absorb money at the pace that we hoped that they can. The funds that are in the budget will fully fund the activities that we believe we can deliver in 2017, and we have restored in the out-years the funding for the program that is implementing slower than we had hoped because we fully intend to be able to fulfill those commitments. So I think, on balance, we have a good pathway forward. We are not worried about being able to execute during 2017 with the funds that we have requested. Mr. Klotz. Could I just add a little bit to that? Mr. Simpson. Sure. Mr. Klotz. Everything Anne said is absolutely right. The good news for us last year was that Congress voted an appropriations bill for fiscal year 2016, and, of course, we are your biggest cheerleaders to get an early appropriations bill this year. Mr. Simpson. We are going to try. Mr. Klotz. You have no stronger supporters, Chairman, than for that. But there still were budget caps we had to write to build the fiscal year 2017 budget. We have a big portfolio that covers a lot of different interests and with strong stakeholders behind it. No one is more passionately committed to the nonproliferation activities that we do than myself, than Anne, than the Secretary, but we had to make a hard-headed business decision. We had to be able to cash-flow everything at fiscal year 2017. When we looked across the portfolio, we saw we had these uncosted balances, as the Secretary and Anne have mentioned already, and it just made business sense to us to use the money that was in the bank to fund these projects in 2017 until we can tackle the fiscal year 2018 and beyond as we build the next budget. Mr. Simpson. Well, I appreciate that and I appreciate the important work that you do. And probably nobody appreciates it more than Congressman Fortenberry, who has worked on this very dedicatedly, and not just from the perspective of looking at the exact budget that we have each year to look at, but in the long-range overall view of how we address this issue and are we looking at it in the right way. I am glad that there is somebody on the Committee that takes a real interest in looking at that, so I appreciate that, Congressman. And Congresswoman Kaptur. Ms. Kaptur. Thank you, Mr. Chairman. General Davis, what is Defense Programs doing in the area of additive manufacturing? General Davis. Well, ma'am, additive manufacturing is a great opportunity for Defense Programs in terms of future technologies, especially in terms of fabricating pieces and parts at our Kansas City National Security Campus. In the past, we would have to send stuff out to be manufactured. It would take several months to turn around. With additive manufacturing at that location, we can now change the forms in a matter of weeks, so it is a great opportunity for us to reduce costs. I can tell you, out at Lawrence Livermore, they are also doing some groundbreaking work in additive manufacturing in terms of how we can use it within the actual design of actual components that would go within the nuclear weapons as opposed to the nonnuclear components as well. Ms. Kaptur. All right, so those would give you locations? General Davis. Well, I would say throughout the NNSA enterprise, additive manufacturing is being used and, certainly, we are pairing all of those labs and plants together to leverage what they are learning at the different locations to get the maximum effect. Ms. Kaptur. Theoretically, in the future, could additive manufacturing actually serve to compromise security in any way? General Davis. Well, certainly one of the challenges with additive manufacturing is that, right now, it takes a lot of skill and expertise to build certain components within the weapons that we use. Once you get additive manufacturing, really the secret sauce is in the design, and those designs are held on computers, so certainly cybersecurity is an important element to protecting those in the future, so there is certainly some hard science that still goes into the work. Certainly protecting the cyber elements of the design is important, and then also there is some unique technologies that NNSA is developing in this area. Ms. Kaptur. Yes, please, Ms. Harrington. Ms. Harrington. So it might not surprise you that General Davis' group and my group are working together on this issue, looking at how to maximize the utilization of this important emerging technology but still protect it, develop classification guidance so that we know within the complex how we can responsibly use it. So we are, again, very focused on those issues and have a great team working together to come up with a solution. Ms. Kaptur. Without getting into too much detail, I would assume the areas of technology that you are particularly interested in, you prefer not to say. Ms. Harrington. We could come back and talk about that. Ms. Kaptur. Okay. All right, thank you. Admiral Caldwell, could you give us an update on the study of the feasibility of using low-enriched uranium in naval reactors that was required in the fiscal year 2016 Defense Authorization bill and funded at a level of $5 million in the appropriations bill? Admiral Caldwell. Yes, ma'am. We completed an initial report over a year ago that just laid out the high-level concerns or things that we would have to deal with in a low- enriched uranium type program, and as directed in the NDAA for 2016, we have a draft, conceptual study to answer Congress' question about this particular issue. That report is in routing for approval, and I can give you some sense of where we are on that. I think the first thing I would tell you is that from a strictly military standpoint, the application of low-enriched uranium is problematic because, fundamentally, what you are doing is you are removing the amount of available energy that you are putting into the core. Now, we have decades of experience in using highly enriched uranium that allow us to operate these reactors for longer and longer time periods. Again, a great example is the OHIO-Class replacement core, which will last over 40 years. Now, from the U.S. perspective, though, a low-enriched uranium core, or pursuit of such things, offers us the chance to take a leadership role. It also offers, within the Naval Reactors Program, a chance to balance out the demand signal on our technical community because, as we come through the OHIO- Class replacement design, we are going to taper off in the demand signal. So to sustain that workforce, pursuing an advanced fuel system, which would be required for a low- enriched uranium, would keep that team working, which is important to us as we get to the next generation submarine. Now, the conceptual study, we looked at what it would take to develop the low-enriched uranium core and what it would take to deploy. The development we estimate would take about 10 to 15 years. It would take an advanced fuel system because you are trying to figure out how to load more fuel because it has less energy. And it would take, again, 10 to 15 years and it would be on the order of about $1 billion. Any work that we put towards that would be of value to the Naval Reactors Program because, again, advanced fuel-cell systems, we could leverage that and even use highly enriched uranium. The conceptual plan has several off-ramps. I talked before about irradiated samples that allow us to examine materials. The plan lays out several phases of irradiated materials that we would take and look at, and over those 10 to 15 years, it would allow us to take some off-ramps to decide whether it was appropriate to pursue the low-enriched uranium core. The conceptual study examines going after a potential use in a carrier core. That is a bigger core than a submarine, and it is not practical today to go do that in a submarine core. So, again, success could not be assured in this effort; 10 to 15 years just to develop the fuel system and probably another 10 years or so to actually deploy the fuel system, that means to construct it and deploy it in a ship. So we are several generations away, but the conceptual plan lays out this opportunity. And if that is the path that we end up going down, it would take money above what we currently have in our budget because we could not do it at the expense of the work that we are doing today to support today's fleet and the OHIO-Class replacement and so forth. So the plan lays out a conceptual plan starting in fiscal year 2018, I hope that answers your question, ma'am. Ms. Kaptur. Yes, thank you very much. All right, General Klotz, could you tell me, does NNSA need to produce any pits to support the current and planned life extension programs? Mr. Klotz. Current, no; future, yes, and so that is the path that we are on. The major demand signal for being able to manufacture pits will be when we get into what we call the Interoperable Warhead 1, which will most likely start off addressing the Air Force's need to do a life extension program for the current W78 warhead. In the meantime, however, we do not have a capability to produce pits and in great number, so we are in the process of doing some significant work at Los Alamos National Laboratory in repurposing existing facility space in a building called PF-4 and another building called Irradiation Laboratory. This year, we will begin analysis of alternatives, on what is known as the modular approach to building additional capacity at Los Alamos to begin to develop pits on the schedule, which the Congress has directed us to do in subsequent National Defense Authorization acts. Ms. Kaptur. Thank you, and I had one follow-up to---- Mr. Klotz. Yes, ma'am. Ms. Kaptur [continuing]. An earlier issue, and that is dismantlements. In addition of your earlier points, is not work leveling at Pantex also a benefit to increasing the rate of dismantlements? Mr. Klotz. Well, with additional people, of course, obviously, that gives you the opportunity to level the work between the dismantlement and the life extension work that has to go on because the skill sets, in many respects, are the same, so with the additional 30 to 40 to 45 people at Pantex and the additional people at Y-12, that gives you a great deal more flexibility. General Davis. I would say, normally, we do use dismantlements to work to balance a workload at Pantex. In this case, the folks we bring on to accelerate those will be dedicated to that effort until that is complete. Ms. Kaptur. I have a final question of each of you. In general terms, is there any unmet scientific horizon or necessary workforce capability that you consider primary to conducting your responsibilities more ably? So science and workforce development. Mr. Klotz. Well, I will go ahead and start. The biggest challenge that we are facing at the moment, of course, is the graying--and I can say that, at my age--of our workforce, both on the Federal side, but, more importantly, in our laboratories and our production facilities. In many places we have a high number of people who are now eligible to retire. Many of them will not because they love what they are doing or they have got personal financial reasons why they want to continue to work, but they are certainly eligible to do that. So we need to make sure, both, again, on the Federal side and the laboratory side, that we are doing all the things that we need to do to recruit the next generation of leadership in this particular endeavor. So that is one of our greatest challenges by the way, in fields, STEM fields, which there is very high demand in the commercial sector for right now, so I would say that is one of the key things that we need to address. Ms. Kaptur. Thank you. Ms. Harrington. So I would add to that that some of the challenges that we face now, many of the challenges, for example, that we have seen in Iran, have monitoring a really unique arrangement to limit their nuclear activities to peaceful ones only, has made us really, I think, through what are all of the things within the nuclear fuel cycle that we need to be more aware of, how would we have more comprehensive monitoring, especially as countries continue to move forward with their nuclear power programs. So that is an area that really is of concern and, very clearly, how would we possibly detect any terrorist acquisition or intent to utilize nuclear radiological materials and, again, getting down to smaller quantities, more difficult movements to detect. So those are the sorts of things. But, again, reinforcing what the administrator said, being able to link some of these activities to universities, being able to draw talented young students into these programs, for example, through our university consortia, has provided both a unique pathway for us to get new talent, but it also helps universities identify areas of research that are really relevant to our mission. So we will continue to pursue those programs, but I have no doubt we will see new challenges in the future and we will have to go back to our labs and test their capabilities on a regular basis. Ms. Kaptur. Thank you. General? General Davis. Yes, so for Defense Programs, I would say it is probably exascale computing. There was a time, certainly, when NNSA drove advanced supercomputing and, basically, industry provided us everything we need. Now we are not the primary user for advanced supercomputing and exascales. So, as we go to exascales, it is important that we are involved, so we can make sure that our codes continue to run. Obviously, our modeling simulation is key to continuing to certify the stockpile and making sure that we understand exactly what is going on with those weapons to keep them safe, secure, and reliable. Ms. Kaptur. Thank you. Admiral? Admiral Caldwell. Ma'am, I would say that the singularly most important thing to enable the success of Naval Reactors' programs is our technical base. This is the funding that goes towards our Naval Reactors' operations and infrastructure to our Naval Reactors' development and to our program direction. That money really goes to support what I call the flywheel, the linchpin, the center of gravity for everything that we do. It supports the infrastructure of the labs and facilities. It pays for the salaries, for my folks to do the oversight and meet our regulatory responsibilities. It pays for the scientists, the engineers, and technicians that do everything that we do in the program from research, design, construction, operation, fleet support, and dealing with disposal at end of life of the core. That technical base, in fiscal year 2017 budget, the request is for $949 million. I could not do what I need to do to support today's fleet, tomorrow's fleet, to recapitalize the tools, the infrastructure, the equipment that I need to be able to ensure the safe, reliable operation of reactor plants. I will not go into it now, but there is a litany of things that that technical base has enabled, all the research and development that eventually goes into reactor plant design. The electric drive on OHIO-class replacement is a product of all that technical base work over the last several decades. The OHIO-class replacement life of the ship fuel is also a result of decades of work in that technical base. Every day that technical base responds to requests from the fleet on the order of 4,000 requests per year for technical assistance that keeps our fleet operating. So your support to fund that technical base is absolutely essential to what I do. Ms. Kaptur. Thank you. Thank you very much for your testimony today. Mr. Chairman? Mr. Simpson. Thank you. Mr. Fleischmann [presiding]. Thank you. Mr. Klotz, I have a question about security, sir. This committee has long been concerned and acted on those concerns about security funding at NNSA sites for several years. There has been an increased workload placed on life extension programs at NNSA's production facilities in next year's budget. Is there a corresponding need to increase the security budget or the security budget to accommodate those increases, and how will that be accomplished, sir? Mr. Klotz. Thank you very much for that question, and of course, safe, secure, and effective security ranks up there in the very top of what we have to do in order to protect these assets, as well as the people who work around them. One of the things, since we came into the position a couple of years ago, that we have stressed is first of all making sure we had the right people in the right positions throughout our security apparatus. We had a lot of vacancies. We had a lot of people who were in acting positions, and we have placed great stress on getting highly qualified people into key positions both at headquarters here in Washington, DC as well as at our site offices, and also making the same stress on the M&O partners that we work with. The other thing we called for was development of a security roadmap. This was another idea that came out of the Congress, and that has been produced. If you do not have a copy of that, also in addition to making copies of that document available, I would be very delighted to make that available as well. We are also again at the direction of the Congress taking a look at sort of a 10-year plan for how we refresh all of our sites. A lot of the perimeter intrusion detection alarm systems, the PIDAS, such as the one we have at Y-12, are beginning to age out in terms of sensors, the cameras, other aspects of that. So, we are working with the CSTART--please do not ask me what that acronym stands for. It is an operation that we have that Sandia National Laboratories spearheads for all of our sites in cooperation with DOD. Again, another product of congressional direction, which is yielding a lot of benefits in terms of how we go forward in terms of that security. At the end of the day though, it boils down to making sure we have, you know, the people, and the good people to do that work, and so we have asked for some additional money in that area to help build up our capabilities. Mr. Fleischmann. Very good, sir. Thank you. I have a question about lithium, and whomever would like to answer that. The Government Accounting Office and the Department of Energy's own Inspector General's reviews highlighted a shortage of lithium for use in refurbishing nuclear weapons, saying the demand had risen and could lead to a lithium shortage at Y-12 by 2018. Could you discuss your plans to respond on how it will affect life extension programs, and does the budget request indicate a 2-year delay in replacing the lithium facility? General Davis. Congressman Fleischmann, thanks for that question. As you know, lithium is an important material used in U.S. nuclear weapons. The GAO did do a report and said that the existing supply of lithium would be used up in 2018. The key word there really is the ``existing'' supply. NNSA does have a plan to create enough useable lithium to get out to 2028 by doing two things. First of all, we will convert lithium from dismantled weapons, and we also have an existing feedstock of lithium that will convert into the proper type of lithium for the life extension programs. Of course, we will need to sustain the current lithium production capability at Y-12 until a replacement facility does come on line. To that end, we started an analysis of alternatives using the NNSA's process last month. We expect that to be done by the end of this fiscal year. That will examine essentially all the options that are available, everything from recapitalizing the current capabilities at Y-12 to perhaps looking at the potential for commercial providers to provide this capability. So, we plan to have that capability on line no later than 2025, giving us 3 years of cushion in between the time that capability comes on line and we expect to run out of the existing supply of lithium. Mr. Fleischmann. Thank you, sir. I would like to talk about Y-12's alarm response training. Ms. Harrington, before I ask you that question, I want to thank you. You came to Oak Ridge and actually spoke at our ETEC meeting, were very warmly received, and I really appreciate your coming in there. That is a group that meets every Friday at Oak Ridge, and it is DOE, business people. It is just a great group of contractors, and many of you have been there. We get a lot done in that forum, and thank you for attending. Y-12 has been called the ``Fort Knox of highly enriched uranium.'' How are you using Y-12's expertise in securing our Nation's highly enriched uranium to secure sensitive nuclear or radiological sites around the globe? How do you see an increased role for Y-12's alarm response training that trains personnel responding to civilian nuclear and radiological security alarms? Ms. Harrington. Thank you, Congressman. It was truly my pleasure to come down and spend time with ETEC. It is a remarkably energetic and terrific group. There is just such a sense of community there, you should be very proud. Mr. Fleischmann. Thank you. Ms. Harrington. So, our alarm response training program, I think, is a terrific example, number one, of utilization of excessed buildings. I think we are now in our second excessed building. The first one, we outgrew. It was the old clinic at Y-12, and we identified it as being suitable for the type of training that we do there. Our new facility, and I was there for the ribbon cutting on that one, is even better because it provides us a more diverse set of scenario's within the building, as well as a very nice training area with monitors where you can see the simulated attacks and response, how a response force would actually have to respond. So, it is as close to real life as you can get with blue and red plastic guns, but it is a really effective way to train emergency responders, local police forces, university police forces on how to respond and keep their communities safe. So, it has been a terrific opportunity, and we have trained thousands of people from across the United States already. We are also using it to bring our international participants not only to have them go through the training, but to help them see how they can set up similar training facilities themselves, particularly in areas where there is higher risk for this kind of intrusion. So, it has been a terrific test bed for us. It has really paid off to communities all across the United States. We are in the process, as I said, of expanding both how we use it for international guests, but particularly as a model for how to do this well. Mr. Fleischmann. Thank you. General Davis, I have a final question for you, sir, on the Supply Chain Management Center. Members of the small business community have discussed with me rather at length the challenges with NNSA's Supply Chain Management Center, and more specifically, the enterprise-wide procurement agreements. I have been told that NNSA is aware of these concerns. Are there plans to address these issues to give small businesses a more level playing field to compete on procurements, sir? Mr. Klotz. Can I take that? Mr. Fleischmann. Yes, sir. Mr. Klotz. Just 2 weeks ago, I joined all the members of the New Mexico congressional delegation for a first ever industry day that the Supply Chain Management Center has held in New Mexico or anywhere else for that matter, in order to address the concerns of small businesses. Four hundred people signed up, 300 people showed up. They heard from the congressional delegations. They heard from the manager of the Supply Chain Management Center. What the Supply Chain Management Center is--it is located in Kansas City at our operation there, but it is a strategic sourcing center which basically serves as a facilitator for companies all over the United States to become a supplier of commodities to not just NNSA's eight sites, but many Environmental Management, EM sites, as well. The purpose of the get-together there was to address the very concerns which small businesses in the State of New Mexico, particularly northern New Mexico, have expressed about the Supply Chain Management Center, to tell them how it actually works. We do not direct--NNSA and the Department of Energy do not direct people to use the Supply Chain Management Center. We created it as an opportunity for our M&O partners to reduce costs by buying strategically. But it is also a great opportunity for small businesses in New Mexico, but elsewhere too in fact, to do business with DOE and with NNSA, and in some cases, to actually expand beyond the local regional areas in which they may do business now to nationwide. So, we gave them an opportunity to learn how the Supply Chain Management Center works. We gave them an opportunity to talk face-to-face with the commodity managers from Kansas City and also the procurement officers from each of our sites, which are part of the M&O contractors, and we are in the process of collecting data which we will share with the New Mexico delegation as well as you, sir, and this committee as to how many people responded and what the feedback was to that. We have also changed a little bit of our processes and procedures. We set this thing up 10 years ago. As a former boss of mine used to say, when you are talking about fallible human beings working in complex organizations, there is 100 percent chance we do not get 100 percent right 100 percent of the time. So, we know there are some adjustments. We have put in a provision whereby instead of being a national supplier, you can be a regional supplier. In fact, we have had one New Mexico company that has very successfully taken advantage of that change. Mr. Fleischmann. Thank you, sir. Appreciate that, and appreciate your endeavors in that regard. My final comment would be to Admiral Caldwell. I want to thank you for taking the time to come to my office to meet with me to go over naval reactors in detail. I knew your predecessor. He did a great job as well. I just wanted to convey from the Oak Ridge community how much we and I cherish the relationship with the Navy, and all that you do for our country, and we hope we will be able to continue on into the future to provide the much needed fuel as the Navy goes forward, sir. Admiral Caldwell. Thank you, sir. We value that relationship. As I think I told you in your office, I endeavor to enhance and strengthen that relationship going forward. Mr. Fleischmann. Thank you, sir. With that, Congressman Fortenberry, do you have any questions? Mr. Fortenberry. Yes, briefly, Mr. Chairman. Thank you. As Chairman Simpson had alluded to earlier and you all gave a good forthright answer about your commitment to nonproliferation, but as it is showing up in budgetary matters, it is sending a signal that you are going to need to explain what you very well did. One of the complaints about government is agencies spin down monies they have in order to build upon baseline for more expenditures in the previous year--in the next year, rather. So, in this regard, you are to be very much commended for again being frank that there was an absorption capacity problem with other partners. You had some leftover funds. You were living under caps, that is a reality, so you are effectively turning money back to the government, or directing it anyway. That creates the problem for next year. You better hope all of us are still here when you come back and show an added expenditure above a new baseline. I think we ought to make an asterisk and note for the record in that regard. Two other quick issues. One is you mentioned the graying workforce problem, graying personnel problem that you are having. I have raised this with the Nuclear Threat Initiative as well, the idea of the next generation of academic experts, of scientists, nonproliferation persons who willingly cast themselves into the strategic thinking of nonproliferation, military and nonmilitary. Where are we in this regard? Are we treading water? I do not see much enthusiasm frankly for this field among the next generation, and that worries me. The second question is regarding the International Atomic Energy Agency. I raised some of this earlier with the Secretary. I think they grow in relevance, they grow in prominence as again whatever architecture we are going to have for the next 100 years to assure that civilization is not under grave threats from nuclear annihilation. That entity grows in its potential impact to keep us safe. Are you comfortable with, again, our shaping of that institution's culture? We have, I think, an excellent director general. That continuity of process is essential, and that is harder to control in international environments. So, those two questions, please. Mr. Klotz. Let me start, and Anne has some thoughts on this as well. You are right. There was a period of time where strategic studies, nuclear studies, defense studies in general--there were more opportunities in various academic institutions across the United States, including the ones when I attended, and that sort of fell off with the end of the Cold War. I think there has been sort of a resurgence of interest, a lot of it fueled not so much by the nuclear strategic force side of things, but the nonproliferation, the nuclear security field. We have had a number of programs in which we have tried to draw upon that expertise, one of them is the NNSA graduate fellows program, where we bring in some of the best and brightest out of recent graduate programs and undergraduate programs to work with us at NNSA for a year, and then hopefully stay or go on to the laboratories. We have had a very, very good success rate in terms of-- Mr. Fortenberry. Are there Centers of Excellence in this regard across the country that you primarily turn to or is it coming from multiple disciplines? Ms. Harrington. Well, there is a group of targets, universities, for example--I hate to keep picking on you, sir, but the University of Tennessee. Mr. Fleischmann. Bless you for that. Ms. Harrington. Howard Hall runs a super program there, but he is not the only one to have recognized that we need first- rate university based programs that not only look at the technical issues but blend those with the international relations and policy issues. We would love to bring some of our fellows to meet you. Mr. Fortenberry. You could place one in my office if you like. We have more than we can handle. Ms. Harrington. We cannot say that too loudly around our folks because they are eager and they are talented, and they are extremely bright. Some of them actually end up going to the IAEA as junior professional officers. We have a lot of young talent that feeds into the IAEA like that. They will go over, they will spend a couple of years in a junior position doing regular staff work, learning an enormous amount, but carrying with them all of the things they have learned working with us. Mr. Fortenberry. So, segue that into my question about the IAEA. Mr. Klotz. It is a very important question, and I think with the JCPOA and as we move into the post-Nuclear Security Summit world with the Nuclear Security Summit that President Obama will host at the end of March, beginning of April of this year, the IAEA and other international organizations will likely have an even larger role and more important role to play in that process. The United States has been intimately involved with the IAEA since its creation in the 1950s. I think we know the organization very, very well. As I said earlier, we provide training. We provide technology. We help them develop their concepts. Now, it is not just a U.S.-driven thing. We have some great international partners who also believe this is an important organization and also commit resources and talent to the effective operation of the IAEA. We also have a lot of Americans over there serving, as Anne suggested, in a variety of leadership positions as well as early career positions in the IAEA. As the Secretary said this morning, it is something we are going to have to pay attention to as one of the member nations of the IAEA to make sure they have the funding they need, either through voluntary contributions or through regular annual budgets, to take on the increased workload that we have called upon them to take. I share your sentiment. I think the leadership, not just at the level of the director general, but among the number of the deputy director generals and throughout the staff, is absolutely first rate. I guess the bottom line is our sense is the IAEA is a very serious, very sober, and very professional organization, and one in which we feel very confident in working closely with as well as other member nations through this international organization to deal with issues of nuclear security that we have talked about. Mr. Fortenberry. Thank you all very much. Mr. Fleischmann. Thank you. Mr. Visclosky, do you have any questions, sir? Mr. Visclosky. I do. Perhaps you can go to Ms. Kaptur first. Mr. Fleischmann. I will recognize Ms. Kaptur first. Ms. Kaptur? Ms. Kaptur. Yes, as the afternoon wears on, you know we get more creative. In listening to your plea for follow-on staff, filling the bench that is coming forward, it reminded me--I will just tell you the world I live in, from Toledo, Ohio to Cleveland, with lots of universities and lots of young people thinking about what their future is going to be. I recently spoke with the new head of the Berkeley Lab, Mike Witherell. I said one of the things we need, whether you are the man or we find somebody--when I was growing up there was something called ``Mr. Wizard.'' Mr. Wizard used to be on TV, and I watched that. That was a really good show. You are too young. I said we need a Mr. Wizard out there somewhere. I was thinking about two science centers that I represent, one in Toledo called Imagination Station, and one in Cleveland called the Great Lakes Science Center. Thousands of children go through there every year. They have no clue who you are or what you do or even that you exist. We have no lab in our part of the country. We have great engineering schools, great scientists, but the Federal Government does not really meet in my region very effectively. A couple of years ago we had Sailor of the Year from Toledo, Ohio, but you cannot get one of your subs up the St. Lawrence Seaway, I guarantee you that, Admiral. Admiral Caldwell. You never know where we show up. Ms. Kaptur. I am waiting. My point is your budget is quite sizable, and there are lots of funds spent on communication and messaging. You may not be the proper place in the Federal Government to do this, Ms. Harrington, but I really want to push you a little bit to think about the assets that you do have, and how one would develop broadcasting a programming that would link to our science centers. You must have old collections. You must have very interesting materials stored in warehouses all over the place. I am not the only representative who has these incredible institutions in their communities trying to help raise the next generation and trying to find a way to engage them. Now, there is a man that broadcasts, and I have no investment in his company or I do not even know if he has a company or if it is a nonprofit, named Bob Ballard, who goes and finds all the ship wrecks. He works for National Geographic some of the time, and the kids are, you know, this is really a big deal. We had an old tanker that went down in Lake Erie many decades ago. Just getting all the oil out of that thing and doing it in the right way, virtually showing it on a big screen in these science centers. The kids get really interested. I know you work at such a different level, but there just might be a way of bringing some individuals in from these science centers and just talking to them, do a convening from places like I represent across the country, and link to them and the teachers that are taking these thousands of kids, can you imagine what that is like, school lunches, everybody has to have boots on, and you have to take them down there, and they go through these exhibits. Can you imagine whatever you could draw from the nuclear Navy, what you might have there, and these kids would be interested. General Davis, whether it is additive manufacturing, we have some of these platforms and these science centers, but what you might bring to it, and from the science arena, Ms. Harrington, what you must have that you cannot communicate to us here but maybe something in there, is finding somebody like a Bob Ballard. I am not pushing him but he knows how to reach the public. I think you could really be a force, you could really be a force out there, and I do not even like the name ``STEM.'' I always say ``STEAM,'' because if you do not have the arts, the rest of it does not really work. So, I always talk about STEM, not STEAM. You have to have the other half of the brain there, too. I just think we shortchange our children, especially from Washington, because we seem so far away, but I just urge you to think about a mechanism to draw in--you know, General Klotz, you can think of a way to do this, particularly the Department of Energy is far removed from the ordinary person compared to something like the SBA, you know. That is on the ground and they have agents and all these other things going around, or the FBI. I would just urge you to consider that. You might have something to offer, and I thank you. Admiral Caldwell. Can I offer a comment on that? I think you might be surprised if you were to go around to naval institutions around the United States, and I would venture to say even Army, Air Force, Marine Corps institutions, that you would find in the public a lot of military members involved in their communities in advancing STEM and probably STEAM to some extent. There are a variety of programs out there, things from robotics to developing undersea vehicles. I know some folks in my headquarters have been involved in things they are interested in, and helping students learn about science, and even the labs have folks they have sponsored and brought in that pursued science. So, there is a lot of that that goes on at various levels across the United States with service members and people who are in the Federal Government that are interacting with folks on a human level and developing interest in science. Ms. Kaptur. Thank you, Admiral. I was thinking of a man that works for our court system in one of the counties I represent. He takes children that have been through the court system--he is actually a parole officer--but one of the projects that they involved hundreds of children in is building ships, seaworthy vessels to go out on the Great Lakes. Can you imagine that? These kids are just into it. We have not lost anybody yet. I am hearing what you are saying, but I am thinking if you could create a spot for it inside the department, and we did not have a chance to mention that to the Secretary this morning. By the way, I have to say yesterday the Medal of Honor was presented to a wonderful member of our Armed Forces who was born in Toledo, my home, and grew up in Grand Rapids, Ohio, which I used to represent and do not any longer, but we are very honored by his service. Mr. Fleischmann. I want to thank the ranking member for her comments. Thank you very much. Mr. Visclosky? Mr. Visclosky. Thank you very much, Mr. Chairman. Mr. Administrator, a recent National Academy of Sciences' report recommended a clean slate approach to building new nuclear weapons and building prototypes in order to exercise design and production skills. Do you agree with the recommendation, and do you believe NNSA and the labs should be focused on building prototypes, and if so, do you have any sense on the cost and how it compares with other priorities you have today? Mr. Klotz. Thank you, Congressman. That is a very important question. I think within the NNSA and within the DOE, we certainly recognize the importance of exercising our capability to do the whole range of activities associated with nuclear weapons from cradle to grave, design, development, manufacturing, prototype building, and testing. Now, there was a letter sent from each of the laboratory directors that were sent at the request of the Senate Armed Services Committee which addressed the importance of all this, but the sense I took from that is a lot of the work associated with that kind of chain of activities is already being done in the very robust scientific and technical work that is done in support of the stockpile stewardship program and life extension programs. There was a report that was recently rendered that talked about the possibility of prototyping, and there is some congressional language that directs that, I think in the NDAA. That language was passed relatively late in the year, in December 2015, of course. So, we have been looking at how we would operationalize that, recognizing there is costs associated with that, that there are a lot of other priorities within the NNSA portfolio, that if we are going to do a program in this particular regard, we need to vet it as a program that would require the Nuclear Weapons Council blessing of it as well as appropriation authorization from the Congress to do that. Well before this congressional language came down, General Davis' folks had already established a thing called the ``Defense Program Advisory Committee,'' and that is one of the things we specifically asked them to take a look at, and they are expected to report out in the early part of this year. So, this is something under active consideration. I think we are actually doing more in this area than we often recognize we are or are given credit for. Mr. Visclosky. If I could ask, on the interoperable warhead, how much work is slated to be done in 2017, if any at all, and how much capability are you retaining to support the interoperable warhead, which was deferred at least 5 years from 2015 to 2020? General Davis. Sir, within the actual program for the W78- 1, there is no money asked for in fiscal year 2017. Within the RDT&E program, we will be doing some work that will prepare for certification of that system, and to make sure that we understand the challenges with certifying a system that will have a common nuclear explosive package. Mr. Visclosky. Okay. Mr. Klotz. On some of the work that was done, there was a 120-day study after that work terminated to make sure we fully captured and archived the work that had been done up to that particular point. As General Davis indicated, the timing of that was moved to the right because of other priorities within the budget and a question of when do we need that kind of capability, and as I mentioned earlier, it comes up with the need to do a life extension program or do something with the W78 warhead. Mr. Visclosky. Okay. Right before we broke for votes earlier in the hearing, you had talked about deferred maintenance, and I think the backlog was $3.7 billion. I also understand that reportedly by 2019, NNSA may have up to 600 excess facilities. Closing facilities, despite people's assumption that it is easy to do, I appreciate that it is not, but also to the extent you can save money on deferred maintenance on facilities that are no longer needed by the United States of America, it is a savings. Where is the administration on that and what difficulties are you facing? Is it a question of money or any help that the committee can give to you? I do not diminish the problem of closing anything. Mr. Klotz. There are two major problems. The most important one is, of course, money to do that. As I mentioned earlier in a constrained budget environment, the first dollar always goes to the mission and to the people who perform that particular mission. These other things get deferred. To actually give you the numbers, at the end of fiscal year 2015, which just passed, we had 421 excess facilities in NNSA, 90 of which we identified as high-risk facilities. Now, the other problem, of course, is some of our facilities are contaminated, so before we either demolish them or turn them over to Environmental Management to do the demolition and disposition of it, we have to do some remediation associated with that. That also is both technically challenging and costly. But we are ramping up the things that we want to do in the area of disposition. One of the most important things, in this particular budget, is we just opened up, a year or so, a new facility in Kansas City. We got out of a 3.2 million square foot World War II-era production facility into one half the size, a lot less expensive to operate, far more efficient, and we are asking for money in 2017 to disposition that by turning it over to a private developer, which can disposition that facility for about $200 million, where we estimated it would cost the Federal Government $900 million. That will take a lot of our square footage out. Mr. Visclosky. Taking Kansas City as an example, is there much as far as job loss in communities that are attached to some of these excess facilities or is it simply a question of they are not efficient for other uses at that location, they are simply not being used for the purposes of NNSA? I assume at some point there are considerations of potential job loss in communities. Mr. Klotz. No, sir. I would have to go back and dig into that. My initial reaction is no. Mr. Visclosky. That is not part of it? Mr. Klotz. It is not part of it, because we move those people into other facilities as we build other facilities. In every facility, for instance, if we create a new facility to do a particular type of operation, the facility that people leave to go into that, we take a look at it and say could this be repurposed, could it be used for other purposes, or is the condition of the facility such that it is time to get rid of it. Mr. Visclosky. Okay. Mr. Klotz. We used to have a rule when I was in the Air Force to build a building, tear a building down, unless you had some other purpose for it. That is an aspiration that is not always backed up by the funds to do it. Mr. Visclosky. One final point and more of a point having worn a number of hats on this subcommittee, and remembering conversations and directives from the committee on lab directed research, looking at my notes for the hearing, I understand there are new accounting rules that went into effect in October. I also understand that the Laboratory Commission made certain recommendations, and I hope after all of these years we are making some progress on that. Mr. Klotz. I am not the expert---- Mr. Visclosky. Overhead. deja vu here. Mr. Klotz. Yes, I know that came up in the testimony earlier with the Secretary, and it is something I am not the expert on in terms of that, other than to say---- Mr. Visclosky. You need to be. Mr. Klotz. I know. There has been some legislation that set a floor of no less than 5 percent, no more than seven percent on that. I will tell you when I talk to the laboratory directors and the plant directors for plant directed research and development, they say this is one of the most important tools they have in terms of recruitment, in terms of retention of qualified individuals, and in terms of actually doing some leading edge science. Mr. Visclosky. I would not argue that point, but there are limitations. Thank you. Thank you, Mr. Chairman. Mr. Fleischmann. Thank you, Mr. Visclosky. I believe we will conclude our hearing today. I want to thank each and every one of you for your service to our country and for performing the vital tasks that NNSA does for our great Nation. With that, we will gavel out. Mr. Klotz. Thank you, sir. [GRAPHICS NOT AVAILABLE IN TIFF FORMAT] [all]