LIFE-CYCLE BASELINE POINTS THE WAY TO
ACCELERATED CLOSURE OF ROCKY FLATS
Larry Murphy
Kaiser-Hill Company, L.L.C.
Life Cycle Planning Division
P.O. Box 464
Golden, Colorado 80402
Phone: 303-966-3274
Fax: 303-966-6029
Allen Schubert
Kaiser-Hill Company, L.L.C.
Strategic Planning Division
P.O. Box 464
Golden, Colorado 80402
Phone: 303-966-5251
Fax: 303-966-6029
Elizabeth Jordan
U. S. Department of Energy
Rocky Flats Field Office
Planning & Integration Division
P.O. Box 928
Golden, Colorado 80402
Phone: 303-966-8057
Fax: 303-966-4775
ABSTRACT
The Department of Energy (DOE) and Kaiser-Hill Company, L.L.C. (Kaiser-Hill) have embarked upon one of the most significant and challenging environmental cleanups in the history of the United States. The cleanup of the Rocky Flats Environmental Technology Site (Rocky Flats or Site), a former integral part of the DOE nuclear weapons complex, had been previously estimated (Baseline Environmental Management Reports I and II) to take approximately 50 years and cost at least $30 billion. The challenge, as identified in DOE's Draft 2006 Plan, is for DOE and Kaiser-Hill to accomplish the cleanup in as little as ten years but no more than fourteen years, at a cost between $6.5 and $8.0 billion.
Much of the groundwork for cleanup is in place. The Site has a breakthrough regulatory cleanup agreement (Rocky Flats Cleanup Agreement, or RFCA, July 1996) between DOE, the Colorado Department of Public Health and the Environment, and the U.S. Environmental Protection Agency. This agreement aligns and promotes the cleanup and closure mission. The preamble to the cleanup agreement delineates potential future land uses following cleanup. Interim radioactive and chemical action levels for the cleanup of contaminated soils and downstream surface water standards have also been established. A performance based contract is in place with specialty subcontractors on-board to accomplish the many facets of the cleanup task at hand, and Kaiser-Hill has developed a closure project life-cycle baseline (LCB) which has been approved by RFFO.
As the closure plan was developed, the life-cycle planning effort at Rocky Flats engaged the Site's management and planning personnel. A comprehensive LCB with over 27,000 scheduled activities and over 80,000 integrated resource records, each with a full basis of estimate, was developed. When the final database consolidation is completed in February 1998, all planning, scheduling, and budgeting (funding-constrained execution year budgets and out-year plans) will reside in a single database. This multi-platform LCB, which is undergoing full validation, will provide a single integrated information and planning system that supports DOE and community goals and objectives for closure of the Rocky Flats Site.
This paper describes the accomplishments to date on developing the LCB and defines the challenges facing DOE and Kaiser-Hill regarding the planning and execution of the cleanup and closure of Rocky Flats.
INTRODUCTION
When production of nuclear weapons components ended at Rocky Flats, the Site's mission changed to one of cleanup and closure. "To manage waste and materials, clean up and convert the Rocky Flats site to beneficial use in a manner that is safe, environmentally and socially responsible, physically secure, and cost effective," became the Site's new charge. Attention is now focused on the activities necessary to stabilize and consolidate hazardous materials and ship them off-site, deactivate and decommission facilities, clean up contaminated sites, and disposition more than one-half million pieces of property and millions of classified documents. A significant feature of the new approach at Rocky Flats involves "projectizing the work - treating the closure as a project with a discrete end - and taking the steps to achieve the goal. In the past, the contractor kept the plant operating and/or maintained the facilities. Today, the Rocky Flats Closure Project means cleaning up the Site, closing it down, and leaving it in a safe condition for other uses.
Kaiser-Hill Company, L.L.C., the Integrating Management Contractor (IMC) for Rocky Flats, has reconfigured and accelerated the Rocky Flats Closure Project. The cleanup of Rocky Flats had been previously estimated (Baseline Environmental Management Reports I and II) to take approximately 50 years and cost at least $30 billion. Kaiser-Hill and the DOE Rocky Flats Field Office (RFFO) reshaped the cleanup into a fourteen year, $7.3 billion closure project, saving approximately $22 billion. This plan is being implemented using fundamental project management strategies. The DOE and the American Taxpayer are realizing significant savings, which have been and are being validated. Based upon the success of the Site in making physical progress toward closure coupled with life-cycle baseline (LCB) planning efforts, the House Energy and Water Appropriations Subcommittee placed all of the Rocky Flats fiscal year 1998 funding into an accelerated closure account, calling the project "a worthy investment." In the words of Energy Secretary Federico Pena on August 7, 1997, "Rocky Flats deserves to be singled out as an Accelerated Closure Pilot because of the precedent-setting efforts that have been made here in performance-based contracting and regulatory reinvention."
The Site's LCB and performance based contract are key components to the accelerated cleanup and closure of the Site. RFFO and Kaiser-Hill are working together to link the performance based contract structure to critical closure activities ensuring that the contractor is incentivized to complete key closure activities with the optimum influence to improving project cost and schedule.
A key outcome of the Site's planning effort was the development of a technical critical path. This critical path shows that the general steps to achieving cleanup and closure of the Site must focus on Special Nuclear Material (SNM) stabilization and offsite shipment in the early years; followed by significant nuclear facility deactivation, decontamination and demolition (D&D); radioactive waste treatment and disposal; and environmental restoration in the later years. Of particular note is the technical critical path shows that early removal of SNM from Rocky Flats is key to accelerating the closure of the Site by four years in order to reach the ambitious goal of cleanup by the end of fiscal year 2006.
PLANNING THE ROCKY FLATS CLEANUP AND CLOSURE
Preparation of an initial Rocky Flats Closure Project life-cycle cost estimate and integrated schedule (LCB) was the most important planning activity that occurred in FY 1997. The LCB, which spans from the present until post-closure monitoring, will direct updates to the Site Closure Plan, preparation of out-year budget call information for DOE, and annual Work Authorization Documents. On-going refinement of the LCB is essential to establishing the integrity of Site planning and allowing effective implementation of work scope and completion of performance metrics (table I). This effort also supports the DOE Headquarters (HQ) initiative for development of a complex-wide integrated baseline.
Table I. Rocky Flats Closure Project Metrics
Planning the Work
The life-cycle baseline (LCB) describes all Site work leading up to the achievement of the RFCA Site Vision, and is the overall integrated closure planning tool at Rocky Flats. The Site's LCB is consistent with the principles and execution requirements of the Rocky Flats Cleanup Agreement and other enforceable agreements, the assumptions in the Site's draft 2006 Plan, and other guidance provided by DOE. If the LCB cannot support an element of one of these items, a detailed explanation of the rationale for the variance(s) is provided in the draft 2006 Plan until such a time as the LCB is formally revised through the Site's Change Control Process. The objective that has been set for the LCB is to obtain a cost accuracy of +40%/-25% for the overall closure project, with considerably greater accuracy (budget quality) for FY98 and FY99. Each year, the budget quality baseline will be extended one additional year, maintaining a biannual detail budget baseline.
Various parts of the LCB are used to communicate Site strategy and detailed planning to stakeholders and regulators. This is a critical step in generating confidence in the Site's ability to plan work and establish baseline controls. The LCB also serves as a diagnostic tool for comparing alternatives and scenarios for Site closure and for preparing updates to the Focus on 2006 Plan.
Most important, however, is the connection between the LCB and funding for the Site. As DOE Headquarters and oversight agencies gain confidence in Site estimates and the ability to perform planned work, Rocky Flats' likelihood of receiving higher sustained funding is significantly enhanced, thus enabling accelerated cleanup.
Creating The Life Cycle Baseline
The development of the LCB was based on the current Site Work Breakdown Structure (WBS), organization, and assigned responsibilities. The final baseline is organized according to Project Baseline Summary (PBS), with WBS activity detail organized according to Work Authorization Document (WAD). In 1997, WADs were updated based on information gathered for the LCB effort. Once completed, the LCB was placed under formal change control, and PBSs/WADs updated to reflect the approved Site baseline for FY 1998.
The LCB is comprised of the technical scope, cost, and schedule requirements necessary to achieve the closure project objectives, and is the product of hundreds of contributors and represents an important milestone in Site planning and integration. This 45,000 page plan (schedule, scope, estimate and basis of estimate) identifies over 27,000 activities and 80,000 resource records necessary to achieve Site closure. Indicative of the level of detail in the LCB, some activities are as short as several weeks and cost only several thousands of dollars. Including escalation and contingency, the total project cost is $7.3 billion.
Revision 0 of the LCB was completed in March 1997. Two updates have occurred, with Revision 1 being issued in May 1997 and Revision 2 in September 1997. Revision 0 represented a total bottom-up scheduling and estimating approach; this effort concentrated on ensuring all necessary closure activities were identified and captured in the baseline. Subsequent to the release of Revision 0 a critical analysis of the LCB was performed. The primary purpose of Revision 1 was to incorporate baseline changes resulting from disposition of comments generated during the critical analysis. Revision 2 was the initial integration of the bottom-up baseline with top-down planning developed as a part of the Ten Year Plan (TYP) effort. Revision 3 is scheduled for release in February 1998 and will fully integrate life-cycle planning with the Focus on 2006 Plan effort. Once Revision 3 is complete, the LCB will become the single data source for producing Field Budget Submission, Focus on 2006 Plan, and Annual Work Plan documentation, schedules, and cost estimates/budgets.
The documentation comprising the Rocky Flats LCB has been subdivided into two categories: RFFO controlled baseline documentation, and IMC controlled baseline documentation. The RFFO controlled baseline documentation includes:
Life-cycle baseline documentation controlled by the IMC includes:
This information is captured in an interlaced database structure that includes Primavera© Project Scheduler© (P3), MicroFrame© Project Manager© (M*PM), and three Microsoft© Access© databases: the Work Proposal Document (WPD) database, Life-Cycle Estimating Database (LCES), and the Basis of Estimate Software Tool (BEST97). Also included in an integrated Oracle© database containing the WBS and all related inter-module data tables.
Using The Estimating Software Tools
The Basis of Estimate Software Tool (BEST97) and the Life-Cycle Estimating System (LCES) bridge the gap that exists between conventional project scheduling and control systems, their allocated or assigned resources, and the set of assumptions (basis of estimate) that correlate resources and activities. Having a documented and auditable basis of estimate (BOE) is necessary for budget validation, work scope analysis, change control, and a number of related management control functions. For biannual budget details BEST97 is used; LCES handles BOE information for the outyears. Although two different databases are used to store LCB information, this difference is not apparent to the user. Data entries are made into a common input screen, and reports are generated from a common reporting menu. (Full integration of the two databases is scheduled for fiscal year 1998.)
At Rocky Flats scheduling is performed by line and project organizations using Primavera©. Schedule data (activity ID, start/finish dates, description, WBS element, duration, activity type) is downloaded directly into BEST97/LCES. For each of these activities BEST97/LCES provides data entry fields to capture activity scope and strategy, streamlining/benchmarking assumptions and results, cost/risk information, hazards identification, B&R/line item code, FCRS/FMSIC identifier (for U.S. DOE applications), responsible organization identifier, identification of the project manager and estimator, change status, and resource estimating line items. For each resource estimating line item data entry fields for performing organization, resource skill code, basis of estimate, line item description, and resource quantity/cost are provided. Expanded text fields for scope definition, basis of estimate narrative, identification of regulatory drivers, and authorization basis status are also provided.
A unique feature in BEST97 is the provision for the identification of "unfunded" items. This permits development of a full cost estimate and basis of estimate, without regard for current or anticipated funding status. As funding decision are made the user is able to "flag" an item as unfunded if it is expected or known that budget authorization approval will be withheld. For each activity, both funded and unfunded costs are shown in the activity resource report.
Unfunded work is prioritized and placed into a master list for use by the Site Change Control Board (SCCB) in allocating management reserve or undistributed budget. As work progresses during the execution year, "unused" contingency is assessed monthly along with management reserve and undistributed budget to determine if a portion should be reallocated to higher priority work. As shown in Figure 1, funding made available through reductions in support costs have been used to invested in mission-related cleanup activities.
Fig. 1. DOE's Functional Support Cost Reporting System Data Demonstrate Cost Reduction in Overhead and Support Costs
By combining output from the scheduling system with BEST97/LCES reports users are able to compile a single-point source document for cost/schedule validation, budget review, and management analysis. Using the data base features, users may produce topical reports to evaluate cost risk, activity hazards, streamlining assumptions, and cost of uncertainty.
PERFORMANCE BASED CONTRACTING
AND THE LIFE-CYCLE BASELINE
Solid work plans are in place at Rocky Flats to bring the Site to closure by 2010 at a cost of around $7.3 billion. RFFO and Kaiser-Hill are refining the IMC performance based contracting structure to provide for improved incentives based on discrete measurable performance that contributes directly to the 2010 closure baseline. Thus, Kaiser-Hill performance measures are tied directly to the Site cleanup baseline as shown in Figure 2.
Fig. 2. Performance Measures Have a Direct Link to the Site Closure Strategy
As structured at Rocky Flats, performance measures provide the following benefits:
ACCELERATING CLOSURE
Early closure of Rocky Flats will benefit the American Taxpayer by returning billions of dollars to the treasury, reducing long-term liabilities, and eliminating safety hazards early. Early investment is critical for a chance at success, as is joint DOE Headquarters/RFFO commitment. Although truly a daunting challenge, closure by 2006 is possible if all contingencies can be successfully managed.
The LCB and the resultant technical critical path are helping to point the way to achieving DOE and Kaiser-Hill's goal of accelerating the cleanup of Rocky Flats four years earlier than the current baseline plan, while saving a projected $1.3 billion (Figure 3).
Fig. 3. Accelerating the Rocky Flats Closure Project
Making up the four-year difference will require accelerated funding, maintaining maximum efficiencies, making shipments as scheduled, and implementing directives and standards as envisioned. Planning and performance have been stable for the last 24 months - cost escalation is being managed, the end state vision has remained consistent, LCB and 2006 Plan integration are occurring, and the schedule has been accelerated for the same scope of work. Key regulatory and labor agreements are in place, special nuclear material repositories have been or will soon be identified, the Kaiser-Hill team's abilities have been demonstrated, and stakeholders are involved and supportive. Funding remains the primary uncertainty.
The LCB derived critical path has helped focus RFFO and Kaiser-Hill on how some of this acceleration could be achieved. The removal of the majority of the Site's 14 tons of plutonium two years earlier than currently planned (i.e., 2002 instead of 2004) could permit deactivation and decommissioning acceleration in the nuclear facilities. This acceleration could result in achieving closure at least two years earlier (i.e., 2008). Further analysis is needed to plan and implement additional acceleration activities, and the critical path indicates that additional breakthroughs (technology, treatment alternatives, shipping strategies, mortgage reduction, decommissioning methodologies, etc.) will be needed.
CONCLUSION
Kaiser-Hill and RFFO face many challenges in Site closure. Most notable are continued improvement in safe operations and the full incorporation of a safety culture at the Site, efforts to decrease the amount of money spent on support and mortgage costs and increasing the amount of money available for mission work, the availability of sites to receive waste and special nuclear material, and the ability to secure adequate funding levels to support accelerated closure. These challenges cannot be met without concentrated efforts to use fully the talent of the Rocky Flats work force, to listen and address stakeholder issues and concerns, and to work in concert with DOE Headquarters and other sites.
Rocky Flats' goal is to achieve an accelerated, cost effective, and safe closure of the Site. This mission represents a complex transition from production-oriented facilities to a site closure project with an environmental management based focus. This challenge mandates a disciplined approach to planning, integration, and control of work activities. To facilitate this disciplined approach, the Site has undergone a paradigm shift in baseline development and implemented a site-wide activity based cost estimate for the life-cycle of the project.
Projectizing the work and using the LCB as a management tool to complement refined contractor incentives and productivity efficiencies, Rocky Flats will expend all efforts required to achieve its goal to accelerate cleanup and closure by the end of 2006.
REFERENCES