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Management Initiatives

Question: Your budget materials only show proposed savings assigned to appropriations accounts. Do you know which programs and activities will be affected? When will you be able to advise the Committee?

Answer: The management initiatives savings targets, with the exception of financial systems reform and that part of the procurement reform initiative dealing with audits, have been distributed among the programs of the Department most likely to achieve savings, and are identified in the narrative justification. It was not possible during budget formulation, and is not possible now, to identify precisely which programs will achieve savings through deobligations and audit recoveries; these savings will be identified as they occur. Since any savings realized will be submitted to the Congress as a proposed deferral, the Committee will be advised at that time as to the programs affected.

Question: There is skepticism within DOE about achieving these savings. If savings are not achieved, how will you distribute this reduction--which amounts to a general reduction--among the individual programs?

Answer: We are confident that we can realize the management initiative savings proposed with the FY 1985 budget. However the Department has proposed appropriation language which has two significant back stops in the event the management initiative savings do not materialize. The first is that to the extent that Inspector General audit savings and deobligation savings do not occur, the appropriation language automatically adjusts the new budget authority to make up the shortage. This is particularly significant since the preponderence of the savings relate to these initiatives.

The second backstop is that we have included additional appropriation transfer authority in our proposed appropriation language. This will give us greater flexibility to achieve the management initiative savings without impacting programs.

Question: The budget allocates a $48 million reduction for management savings to the Energy Supply R&D account. If savings are not found, what prevents the Department from reducing the meager solar program, for example, by $48 million with no reductions in any of the other programs in the $2 billion account?

Answer: The Department is committed to achieving the management initiatives savings reflected in the budget without adverse impact on programs. The appropriation language proposed by the Department will enable us to insure that we take advantage of the savings we realize, while carrying out our programs at the level reflected in the budget.

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Question: It appears that there 18 $77 million in unobligated balances from FY 1984. Please explain - outline the source of these funds.

Answer: The unobligated balances being carried into FY 1984 are from a variety of sources. The sources of funding are outlined below:

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(1) Staffing & staffing related underruns.....

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(2) Revenues received in excess of originally forecasted amounts........................

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(5) Funds for GSA Forrestal move. .............


(6) Minority Loan program. ....................


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(2) Delayed capital equipment purchases.......

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Question: Your budget justification material shows about $33 million of FY 1984 budget authority unobligated and available in FY 1985. Why is this amount substantially less than the amount shown in FY 1984? What is the source of these funds? Is a similar unobligated balance expected to be available in FY 1986. Why or why not?

Answer: The reason the amount of unobligated balances being carried into FY 1985 is substantially less than being carried into FY 1984 is because a portion of these unobligated balances were deferred from FY 1983 funds into FY 1984 to finance a portion of the FY 1984 program level.

The Department has prepared a program plan for activities funded within the Departmental appropriation with the guidance contained in the FY 1984 Appropriations Bill Conference Report and as a result, use of the entire amount of prior year unobligated balances is not needed in FY 1984. Accordingly, the excess of (approximately $29M) is being deferred into FY 1985 to partially offset the FY 1985 appropriation request. The remaining $4M will be derived from prior year deobligations.

It is likely that some unobligated balances will be carried
into FY 1986, however, the magnitude will not be as large as
in the past. The Department is currently using its unobligated
balances to finance its current program level in both FY 1984
and FY 1985 thereby utilizing all remaining obligational
availability by the end of FY 1985.


Question: There is $219 million anticipated in offsetting revenues for Departmental Administration in FY 85. Can you describe in general the source of those revenues and why you expect more in FY 85 and FY 84?

Answer: The $219 million anticipated in offsetting collections represent the current estimate of collections received from the sale of products and services. The Departments estimate represents $128 million in collections to be received based upon performing $115 million in the Cost of Work program and $91 million in collections from sales of by-products that have no costs associated within the Departmental Administration Appropriation. These items are incidental by-products of activities funded from other Departmental programs.

In general, the Department's estimate of collections represents the current estimate to be collected from the sale of products and services to non-DOE customers. Examples of such items include special reactor material, isotopes, irradiation and test reactor services, and special testing activities at the Nevada Test Site.

Question: Please provide for the record a breakdown of revenues including sale of by-products for FY 83, FY 84, and FY 85.

Answer: The following table provides a breakdown of revenues including sale of byproducts for FY 83, FY 84, and FY 85 (dollars in thousands):

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Subtotal, Products Sold. ........... $ 36,741 $ 42,504 $ 28,148

Collections from Services Provided:

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o Use of DOE Pacilities........... $ 7,388

Irradiation Services and Test

Reactor Experiments............. 3,590 o Special Services and

Pabrications.................... 1,255 o Research for Protection of

Public Health and Safety ........ 5,131
Miscellaneous Services.......... 68,814

Services to foreign govern-
ments towards the Hot Dry Rock,
design, studies and analysis
of nuclear test shots; special
preparation, protection and
shipping of heavy elements;
remedial action at reactor
sites; training and technology
programs and studies; R&D on
the tagging of fuel pins;
and decontamination services.

Subtotal, Services Provided. ....... $ 86,178 $ 92,735 $100,003 Subtotal, Collections.............. $122,919 $135,239 $128,151

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Question: Please explain why the FY85 request includes $24 million for In-house Energy Management. For the record, provide a list of all projects with FY85 requirements, total estimated cost, and payback period.

Answer: The FY 1985 In-house Energy Management request for $24 million will provide funding for those projects with the greatest return on investment as well as provide survey funding to continue to identify potential retrofits for future funding. The level of funding is a decision based on our total backlog of retrofit projects and the economic return of individual projects balanced against other Departmental needs. We select projects based upon their life cycle savings rather than simple payback, since different projects have different economic lives. The following is the current tentative list of projects to be funded in FY 1985, which indicates total cost, life time savings to investment ratio, and simple payback period.

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