The contractor managing the nuclear weapons laboratory at Los Alamos, N.M., was slapped with a $57-million reduction in its fees for 2014, largely due to a costly nuclear waste accident last year.
The contractor, Los Alamos National Security, saw its fee reduced 90% because of the accident, in which a 55-gallon drum packaged with plutonium waste from bomb production erupted after being placed in a 2,150-foot underground dump in the eastern New Mexico desert.
The Department of Energy determined that the contractor had a “first-degree performance failure” and cut its fee to $6.25 million — a pittance compared with the $63.4 million that the contractor could have earned if it had met all of its 2014 contract incentives.
“The size of the cut was astounding,” said Jay Coghlan, director of Nuclear Watch New Mexico, a group that scrutinizes operations at Los Alamos National Laboratory. “It is a step in the right direction.”
Coghlan said the Energy Department also reduced the duration of the management contract by one year for the consortium, which was selected in 2007 to help restore order to the lab’s operations after more than a decade of security lapses, management errors and accounting scandals.
The consortium includes San Francisco-based Bechtel Corp., the University of California, Charlotte, N.C.-based Babcox & Wilcox Co. and San Francisco-based URS Corp.
New Mexico’s Environment Department fined the lab $36.6 million in early December, finding it had violated two dozen rules and regulations. Late last week, the U.S. Energy Department and the Los Alamos consortium asserted that the state lacks legal jurisdiction to issue the fine.
Don Hancock, director of the nuclear waste program at the environmental watchdog group Southwest Research and Information Center, said the refusal to pay the fines amounts to a serious political confrontation between New Mexico’s Republican Gov. Susana Martinez and Energy Secretary Ernest J. Moniz.
Martinez hand-delivered notice of the fine to Moniz, Hancock said. “It tells you that the Energy Department and the contractor don’t believe they have to comply with laws and permits,” Hancock said.
While watchdog groups applauded the tough sanctions, some nuclear weapons scientists said it was an overreaction.
“As long as you don’t lick the walls, you can’t get any radiation down there. Why are we treating this like Fukushima?” he said, referring to the 2011 nuclear reactor disaster in Japan.