No cuts foreseen at laboratory

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Budget > Uncertainty remains the watch word

By John Severance

As far as the budget and economy is concerned, Congress continues to kick the can down the road.

In the past week, the House of Representatives and Senate approved a new stop-gap measure to continue funding the federal government for the remainder of this fiscal year. President Barack Obama made it official Tuesday afternoon, signing the bill.

So how will the continuing resolution affect the Los Alamos National Laboratory?
Lab Director Charlie McMillan shed some light on the subject at a community leader’s breakfast meeting at Ohkay Owingeh Casino Tuesday.

But there still was quite a bit of uncertainty on how the numbers will play out.
McMillan said he expects that sequestration will result in reduction to lab funding, ranging between $100 million and $120 million.

“Having said that,” McMillan said, “this is not a surprise because we did not expect 2013 to be a big budget year for the lab. We have managed our budgets in the past year to minimize the cuts this year.”

He expects to see challenges in the cybersecurity front as well as in plutonium conversion. McMillan also foresees some possible cuts in the environmental program.

But he also said it could be worse.

He said the actions taken by the lab in 2012 to control spending have given it some flexibility to deal with budget uncertainties in 2013.

“As you know, 2012 was a difficult one for the lab,” McMillan said.

He said the lab finished 2012 with $383 million less in funding than 2011. The 2011 reductions include $183 million for operations and maintenance and $200 million for construction. Since 2011, the lab’s budget has dropped about $500 million. But 2011 was a high water mark for the lab because it received more than $350 million in stimulus money from the American Recovery and Reinvestment Act.

In addition, the lab tightened its belt as McMillan said the lab finished 2012 with 1,295 fewer employees than the previous year.

Of the 1,295 employees that left the lab, 557 departed under the voluntary separation program last spring.

McMillan said the other numbers could be attributed to contactor cuts, normal attrition and slightly fewer students.
He said procurements are down by nearly $200 million from FY 11. In September of that year, the lab racked up $894 million in procurements compared to $696 million in FY12.

McMillan has said that workforce reduction is not a viable option in 2013 and the lab will continue to control spending and limit its procurements. He did not address the possibility of furloughs.

“We have been controlling our procurements and spending since November of 2011 and the actions we have taken has prepared us for uncertainty,” McMillan said.

He also made the following three points to the community leaders in attendance.
• The lab will continue to work with NNSA to provide technical answers to reform policy decisions.
• Must look at long-term impacts when considering short-term solutions.
• And McMillan urged employees to focus on safety, security and mission execution.

Acting Los Alamos Site Office manager Juan Griego said from a federal perspective, the NNSA is doing the best it can in dealing with the budget uncertainty.

“The continuing resolution will allow us to operate,” Griego said. “We just have to find out what the numbers are. There continues to be a lot of uncertainty.”

He hopes things might get clearer when the administration presents its FY14 budget in April.

Griego also detailed what is happening in the Department of Energy leadership chain.

Steven Chu announced his resignation and Obama tapped Ernest Moniz, a MIT scientist, to fill the post.

Confirmation hearings for Moniz will begin April 9.

Currently, Neile Miller is the acting National Nuclear Security Administration secretary following the retirement of Thom D’Agostino. NNSA is looking to fill leadership spots at LASO as well. Griego is the acting manager but he has been slated for assignment for a two-year stint with the New Mexico National Guard. Griego took over for Kevin Smith, who left late last year to take a spot as the Manager of the Office of River Protection in Washington State.

“The Secretary of Energy will make those selections,” Griego said.