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Introduction

The society which scorns excellence in plumbing because plumbing is a humble activity, and tolerates shoddiness in philosophy because philosophy is an exalted activity, will have neither good plumbing nor good philosophy. Neither its pipes nor its theories will hold water.

—John W. Gardner, Saturday Evening Post, December 1, 1962

BACKGROUND

The U.S. Congress (U.S. Congress, 2001), the U.S. Government Accountability Office (GAO, 2003), the DOE Inspector General (DOE IG, 2003), and DOE management (DOE, 2004) have recognized the importance of DOE’s facilities stewardship to the department’s ability to achieve its overarching mission of “protecting national, energy, and economic security with advanced science and technology and ensuring environmental cleanup” (DOE, 2003). They have also recognized that DOE has in the past exhibited severe management challenges in the development, sustainment, recapitalization, and demolition of real property assets. Given the criticality of DOE’s mission and its extensive real property responsibilities—including 50 major facilities in 35 states with 243.57 million square feet of buildings and a replacement plant value of $73.1 billion (GAO, 2003)—DOE’s ability to manage its real property assets is important to our nation’s well-being.

In 2001, the U.S. House of Representatives Committee on Appropriations noted that:



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Intelligent Sustainment and Renewal of Department of Energy Facilities and Infrastructure 1 Introduction The society which scorns excellence in plumbing because plumbing is a humble activity, and tolerates shoddiness in philosophy because philosophy is an exalted activity, will have neither good plumbing nor good philosophy. Neither its pipes nor its theories will hold water. —John W. Gardner, Saturday Evening Post, December 1, 1962 BACKGROUND The U.S. Congress (U.S. Congress, 2001), the U.S. Government Accountability Office (GAO, 2003), the DOE Inspector General (DOE IG, 2003), and DOE management (DOE, 2004) have recognized the importance of DOE’s facilities stewardship to the department’s ability to achieve its overarching mission of “protecting national, energy, and economic security with advanced science and technology and ensuring environmental cleanup” (DOE, 2003). They have also recognized that DOE has in the past exhibited severe management challenges in the development, sustainment, recapitalization, and demolition of real property assets. Given the criticality of DOE’s mission and its extensive real property responsibilities—including 50 major facilities in 35 states with 243.57 million square feet of buildings and a replacement plant value of $73.1 billion (GAO, 2003)—DOE’s ability to manage its real property assets is important to our nation’s well-being. In 2001, the U.S. House of Representatives Committee on Appropriations noted that:

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Intelligent Sustainment and Renewal of Department of Energy Facilities and Infrastructure The Committee is aware of the continuing decline in the condition of the Department’s facilities throughout the complex and of the Department’s inability to properly evaluate and address the readiness and maintenance status of its facilities. Many of its aged, deteriorated facilities and infrastructure lack the functionality to provide adequate mission support. (U.S. Congress, 2001, p. 97) In response to this observation, the appropriations committee started facilities recapitalization funding initiatives and directed DOE to contract with the National Research Council (NRC) to evaluate the steps the department is taking to improve its facilities and infrastructure management. This report and the preceding preliminary assessment (NRC, 2004) are the products of this evaluation. The preliminary assessment letter report is included in this report as Appendix A. COMMITTEE COMPOSITION The evaluation was conducted by the Committee on the Renewal of Department of Energy Infrastructure under the auspices of the NRC’s Board on Infrastructure and the Constructed Environment. The committee’s 13 members have expertise in a variety of disciplines, including construction and project management, corporate and strategic planning, capital programming and budgeting, land use and site planning, commercial real estate, and facility engineering and management. The group incorporates experience in large-scale strategic planning in the corporate environment, as well as facility planning and management in government, higher education, and other large institutions. See Appendix B for biographies of the committee members. STATEMENT OF TASK The committee was established to address the following statement of tasks: Assess DOE’s facilities and infrastructure management practices and initiatives and provide recommendations for areas requiring additional focus; To improve life-cycle performance and mission support, identify or develop “best-practice” tools and techniques for DOE real property asset management in such areas as site planning; maintenance and recapitalization planning; space and land utilization; disposal strategies; information technology applications; and financing, cost allocation, and cost recovery strategies; Develop guidelines for deciding when to repair, renovate, or replace DOE buildings and other facilities based on factors such as agency mission objectives and return on investment; and

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Intelligent Sustainment and Renewal of Department of Energy Facilities and Infrastructure Define performance metrics that integrate budget with expected outcomes and ensure accountability. COMMITTEE EVALUATION PROCEDURES The committee’s evaluation is based on briefings by DOE headquarters staff in August and December 2003 and in March 2004. In October and November 2003, the committee also conducted site visits, which included briefings by DOE and contractor staff, at the Lawrence Berkeley, Lawrence Livermore, Oak Ridge, Sandia, and Los Alamos National Laboratories, as well as at the National Nuclear Security Administration Y-12 site and the Savannah River site. The committee reviewed DOE’s departmental policies and procedures including Order O 430.1B (Real Property Asset Management), the Condition Assessment Survey, and the Facilities Information Management System database. The committee also reviewed guidance from the DOE program secretarial offices, including the National Nuclear Security Administration, the Office of Science, and the Office of Environmental Management, which are responsible for 95 percent of DOE’s real property assets. Site-specific procedures for 10-year site plans and facility management tools were also reviewed. A list of briefings to the committee is provided as Appendix C. In addition to drawing on its broad experience, the committee investigated the policies and procedures used by other federal agencies and private industry through briefings, interviews, and document reviews. These organizations included the Department of Veterans Affairs, the National Aeronautics and Space Administration, the Office of the Deputy Under Secretary of Defense for Installations and Environment, the Naval Facilities Engineering Command, the Navy Shore Installations Command, the Coast Guard, and E.I. du Pont de Nemours and Company. The committee appreciates the cooperation and support of the Office of Engineering and Construction Management and of the DOE program offices, site offices, and site contractors as well as the support of all organizations referred to above in providing background information and facilitating the site visits. The committee recognizes that these facilities management professionals contributed significant time, effort, and enthusiastic support, thus enabling the committee to address its assigned tasks. ORGANIZATION OF THIS REPORT The committee’s preliminary assessment (NRC, 2004) noted that “DOE has issued policies that if adequately and consistently supported by meaningful practices and procedures will improve the quality of facility management and will lead to better allocation of resources for the effective support of DOE’s missions.” The committee also noted that its final report would address opportunities

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Intelligent Sustainment and Renewal of Department of Energy Facilities and Infrastructure and methods to facilitate implementation of improved DOE policies and procedures consistently across DOE programs and sites. The committee has addressed its assigned tasks in three chapters. Chapter 2, “Infrastructure Management Practices and Organization,” discusses the opportunities for creating a DOE culture that fosters life-cycle facilities stewardship, including issues of leadership and delegation of authority. The role of the department’s strategic plan is emphasized and an example is provided of effective life-cycle stewardship in industry. Options for increasing the opportunities for process improvement through organizational change and through investment in human capital and knowledge management are also discussed. Chapter 3, “Infrastructure Management Challenges and Opportunities,” discusses the actions needed to achieve the objectives of DOE’s Real Property Asset Management order. The committee endorses the order but notes that additional detailed guidance is needed for its implementation and for the effective application of DOE’s Condition Assessment Survey, Facilities Information Management System, and 10-year site plans. Opportunities to improve DOE’s facilities and infrastructure planning and budgeting process are presented using Dupont and the new Department of Defense procedures as examples to be considered. Because DOE facilities are government owned but contractor operated, the committee emphasizes the federal oversight role and the need for clear accountability, consistent oversight and quality control, and appropriate performance incentives. Chapter 4, “Infrastructure Management Performance Measures,” discusses the importance of performance measures for management planning and budgeting as well as for process improvement. The committee identifies the qualities of effective metrics and describes the sets of metrics used by successful organizations in industry, education, and government. A construct for an integrated facilities management system based on metrics used by DOE and additional metrics developed by the committee is also described. Chapter 5, “Conclusion,” reviews and updates the assessment in the committee’s February 2004 letter report and further defines actions that DOE should take to improve its F&I stewardship. The appendixes include the full text of the February 2004 letter report, biographies of the committee members, and a list of the briefings to the committee. REFERENCES DOE (U.S. Department of Energy). 2003. The Department of Energy Strategic Plan; Protecting National, Energy, and Economic Security with Advanced Science and Technology and Ensuring Environmental Cleanup. Washington, D.C.: U.S. Department of Energy. DOE. 2004. FY2006–FY2010 Planning Guidance. Washington, D.C.: U.S. Department of Energy. DOE IG (U.S. Department of Energy Office of Inspector General). 2003. Planning for National Nuclear Security Administration Infrastructure. Washington, D.C.: U.S. Department of Energy. GAO (General Accounting Office). 2003. Major Management Challenges and Program Risks in the Department of Energy (GAO-03-100). Washington, D.C.: U.S. General Accounting Office.

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Intelligent Sustainment and Renewal of Department of Energy Facilities and Infrastructure NRC (National Research Council). 2004. Preliminary Assessment of DOE Facility Management and Infrastructure Renewal. Letter report. February. Washington, D.C.: National Academies Press. U.S. Congress, House of Representatives, Committee on Appropriations. 2001. Energy and Water Development Appropriations Bill, 2002. House Report 107-112. Washington, D.C.: U.S. Congress.