LANL scrutinizes costs, spending

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Lab: Top official creates financial stewardship council

By Carol A. Clark

Los Alamos National Laboratory Director Charlie McMillan has announced a plan to establish the Laboratory Integrated Stewardship Council (LISC) in response to the uncertainties of operating in FY12 under a Continuing Resolution through Dec. 16.

“This leaves us in a financial position that is filled with uncertainty, since the timeframe for a completed budget is unknown,” McMillan said in an organization-wide memo. “While we have already implemented a number of cost savings measures at the laboratory, we must do more given the financial uncertainty facing us.”

Will there be layoffs at the lab?

“Aside from the management committee to review our expenditures and hiring, it’s premature to speculate about any further actions,” said LANL spokesperson Fred deSousa Friday. “Charlie has pledged to keep our workforce informed as soon as we know more. As Charlie’s memo says, the lab is taking action now to accommodate what we expect will be an approximately $200 million reduction in our budget from fiscal year 2011 to fiscal year 2012. Overall, that’s about an 8 percent cut.”

Even though the budget is not yet final, deSousa said that the director believes that it’s prudent to take these actions now.

“We’ll do this without compromising worker safety, security or our critical missions for the nation,” deSousa said. “And the sooner we do this, the better position we’ll be in when the budget picture becomes clearer.”

The LISC will be charged with ensuring that resources are managed in a consistent and appropriate fashion throughout the laboratory, McMillan said in his memo.

“This council will be chartered to make financial decisions and approvals (staffing and spending) in order to keep laboratory spending in line with the budget realities we are facing,” McMillan said. “The council will report progress to me on a weekly basis. I anticipate the group will function through the end of FY12, at which time I will consider whether it is still needed.”

More specifically, McMillan said the LISC will become the decision point for all hiring actions and procurement actions over $100,000.

The director appointed LANL Executive Director Rich Marquez to lead the council with Principal Associate Director of Global Security Terry Wallace, Principal Associate Director of the Weapons Program Bret Knapp, Principal Associate Director of Operations & Business Carl Beard, Principal Associate Director of Science, Technology and Engineering Alan Bishop and Principal Associate Director of Capital Projects Paul Henry. Individuals from several laboratory offices will staff the LISC.

“The LISC is tasked with bringing prudent financial management to our current budget situation while at the same time ensuring that we continue to meet our national security mission and research and development assignments,” McMillan said. “The LISC will also over see our ongoing efforts to meet the President’s executive order to reduce spending in the areas of travel, IT, paper usage and the vehicle fleet.”

While McMillan said that he realizes this will require master management staff to start making harder choices in their spending actions, he said it is necessary in light of the current economic climate.

“We must be more aggressive in our management of costs early in the fiscal year to avoid having to take more dramatic actions later,” he said. “It will take the efforts of the entire laboratory to realize cost savings and manage our affairs within our current budgets.”   

McMillan encouraged master management staff to share ideas for cost savings opportunities with their directorate management.

He added that the LISC will be providing more specific guidance on hiring and spending requirements in order for LANL to meet its FY12 financial goals.