Question 5: Who is responsible for monitoring the costs of the project?

Answer:

The Secretary's memorandum of September 7, 1989, establishes the basic management organization, authorities and responsibilities for the SSC project. Specifically, the Secretary has set up a management organization that is unique in the Department, with the Project Manager on-site in Texas reporting directly to the Headquarters Program Manager, and separately to the Secretary. This clear line of responsibility, authority and reporting is designed to provide for early identification of problems and to ensure their resolution in a timely manner. The costs of the project will be monitored by the Project Manager and reported directly to the Program Manager and, as appropriate, to the Secretary.

Answer:

The Secretary has authorized an on-site Project Office for SSC
to work directly with the Laboratory on a day-to-day basis to
oversee project activities and to monitor technical progress as
well as cost. The SSC Laboratory will provide periodic reports
on progress and project expenditures; the Project Manager and
Program Manager in the Office of Energy Research (ER) will
conduct periodic reviews on the status and technical "well-
being" of the project. This reporting and review process,
combined with independent reviews by ER's Office of Construction
Management and the DOE office for Independent Cost Estimating as
required by DOE Orders, will serve to provide the necessary
information for DOE to exercise its management responsibilities
in oversight of the Management & Operating (M&O) contractor,
University Research Associates.

Question:

Answer:

To whom are the results reported?

The Project Manager will monitor costs and report these to the Program Manager in Headquarters and to the Secretary as appropriate. This reporting by line management is in addition to the formal review process of the Department's Energy System Acquisition Advisory Board (ESAAB) for major projects in the Department. This process provides information on the cost, schedule and technical progress, as well as a mechanism for a formalized decision process for major acquisition milestones for the project.

Question:

Answer:

What is the process if it appears that new cost increases are occurring or may be required?

The Project Manager will first try to understand the reasons for the increase and will keep the contractor working on the problem to maintain the cost. If it appears that nothing can be done to keep the cost to the original level, the Program Manager at Headquarters, the Deputy Secretary as Acquisition Executive, and the Secretary will be informed through the Energy System Acquisition Advisory Board (ESAAB) process. Appropriate strategies will then have to be developed, such as reducing the

scope of the project or requesting an increase from OMB and the Congress.

Question 6:

Answer:

Will the next cost estimate, including the $1 and $2 billion increase, establish a new cost base line against which management will evaluate performance? If not, what is the base line for cost measurement?

The cost estimate to be developed and validated during the
summer of 1990, will be a site-specific cost estimate for the
Ellis County, Texas, site and will establish the baseline for
the design and construction to follow, against which performance
will be evaluated. Performance will be evaluated in accordance
with published DOE orders.