Energy Secretary Ernest Moniz has yet to use a special authority given to the position two years ago by Congress to prohibit procurements from potentially risky nuclear-weapon component suppliers, the Government Accountability Office (GAO) found in a report released last Thursday.
The fiscal 2014 National Defense Authorization Act outlined an enhanced procurement authority allowing the energy secretary to exclude certain suppliers from procurements in the interest of national security, the report said, noting that “the U.S. government is concerned about the trend toward a non-domestic supply chain for nuclear weapons components, and the increasing sophistication of adversaries.”
The authority is intended to mitigate supply chain risks, which could involve adversaries’ sabotage or subversion of the design, integrity, and operation of nuclear-weapon components and nonproliferation and counterproliferation programs, the GAO said. The Department of Energy currently manages supply chain risk in part through its contractors’ lists of approved component suppliers and the department’s own intelligence and counterintelligence activities.
However, the energy secretary has not used the enhanced authority as of this May, the GAO found, nor has the Energy Department developed processes for employing the power, such as risk analyses and assessments, “as it had not fully assessed the circumstances under which the authority might be useful.”
“Some DoE and [National Nuclear Security Administration] officials and M&O contractor representatives expressed uncertainty about whether the authority was needed,” the GAO said, noting that contractors are unlikely to request the procurement authority be used because they are “generally not required to disclose security-related reasons to explain why a particular supplier was not selected.”
Department officials also noted that federal agencies can via the Federal Acquisition Regulation already bar suppliers that could threaten their supply chain, the GAO said.
The report recommended the NNSA administrator work with the DoE’s Office of Intelligence and Counterintelligence to examine whether the procurement authority should be used in certain situations and, if so, establish processes for its application. Congress could then use this information to determine whether to extend the authority past its current June 2018 termination date, the report said. NNSA agreed to complete these activities by the end of this year.
The report also noted that the Kansas City National Security Campus and the Sandia National Laboratories lead NNSA supply chain risk management activities. The GAO said the National Security Campus makes or procures over 100,000 components each year and has increasingly purchased non-nuclear components from external suppliers.
NNSA spokeswoman Francie Israeli confirmed by email that the agency has not used the enhanced procurement authority.
“NNSA agrees with the auditor’s recommendations to evaluate situations that might warrant the use of the enhanced procurement authority and, should specific circumstances be identified to require use of the authority, develop a process for its use, including an assessment of resources supporting the process,” Israeli said.