Category Archives: Savannah River Site

The Rent-Free SRNL Offsite Alternative

by Don Moniak
January 8, 2024

As reported in One-Year Lease After One-Year Lease, the U.S. Department of Energy’s Savannah River Site (DOE/SRS) has only authorized its Savannah River National Laboratory’s (SRNL) management and operating contractor to negotiate one-year, renewable leases for space in the proposed $20 million, publicly-funded “Mixed-Use” office building in downtown Aiken now under development by the Aiken Corporation.

A more suitable option for the $20 million effort is to have the City of Aiken complete the project, and then gift the building to the the State of South Carolina’s University system—which is a party in the management and operating contract. This option would satisfy the state’s contractual commitment for its major Universities to invest in the SRNL contract, which was the primary justification for the $20 million allocation from the state’s plutonium settlement allocation to pay for the project.

The Rent-Free Alternative

Monday evening’s regular Aiken City Council meeting agenda includes a Public Hearing of the “First Reading of an Ordinance to Amend the 2023-24 Budget to Include $20 Million from the Plutonium Funds for the Mixed-Use Building in the Downtown.” 

The supporting memorandum for the ordinance states, in part:

The Department of Energy [DOE] gave the Savannah River National Lab (SRNL) conditional approval to begin discussion with Aiken Corporation on a lease to occupy a portion of a mixed-use building in Aiken to be built on a currently vacant lot on the 100 block of Newberry Street NW.”

The Newberry Steet, NW, property is currently owned (1) by the Aiken Corporation (ACorp), which hopes to develop and own the “mixed-use” office building that will require at least $20 million of public funds obtained by the City of Aiken (COA) from the State of South Carolina’s plutonium settlement.

The current managing and operating contractor for the DOE-owned SRNL, the Battelle Savannah River Alliance (Battelle), has a five-year, multibillion dollar contract with DOE/SRS; with an option for a five-year extension.  The Alliance includes the state’s major Universities: Clemson, South Carolina State, and the University of South Carolina. 

As reported in 45,000 Square Feet Without a Tenant, the future of the $20 million plus “mixed-use” facility is entirely dependent upon ACorp reaching an agreement with Battelle for a long-term lease for use of a “portion of the building;” with subsequent approval by the Department of Energy’s Savannah River Site (DOE/SRS). 

In fact, the COA’s Economic Development department warned twice in its most recent monthly reports that the ACorp Board “has made it clear that no further steps can or will take place until DOE/SRNL has offered an unambiguous, albeit contingent, commitment to lease the proposed facility….At this point, an MOU, LOI, draft lease, or some other instrument, even one with significant contingencies and hard outs for each party, is essential. Without one by year’s end, the chances of the project moving forward become less likely.

Yet, ACorp is moving forward on a Request for Proposals for architectural design services with an estimated cost of up to $2 million; all without any contract with Aiken City Council to do so.

In actuality, the $20 million allocated by the South Carolina legislature was not for a “Mixed-Use Building in the Downtown” that would be owned by a private organization. The state legislature in 2023 specifically allocated $20 million for “Off-site infrastructure improvements for SRS/National Lab, including the Aiken Technology/Innovation Corridor.” This line item in the plutonium settlement disbursement contained no provision for rent payments from the federal budget to any public body or private organization.

The allocation, if implemented as written, actually satisfies the state’s required investment commitment for the Universities to participate in the SRNL management and operating contract. As reported in Offsite Infrastructure, the Universities are contractually obligated to invest in the contract and the only specified deliverable in that contract provision is a “workforce development” facility. (2)

The City of Aiken’s “Savannah River Litigation Settlement Fund Request Form” (Figure 1), submitted one year ago, contained no mention of a “Mixed-Use Facility.” The proposal was for a building devoted to a “Workforce Development facility” for SRNL; to be built on city-owned property. The funding request, which also contained no mention of the Aiken Corporation, defined the purpose as:

Construction of workforce development center, shared event/exhibition space and office space for the Savannah River National Lab to be located within the incorporated limits of the City of Aiken on property under the control of the City of Aiken.”

The City of Aiken does not control Aiken Corporation property.

Figure 1: City of Aiken request for $20 million SRNL project funds. (Click to enlarge)


The allocation granted by the SC legislature in response to this funding request was for off-site infrastructure, with no strings attached in terms of future leases or revenues. The funding did not specifically allow for a commercial building to be constructed on behalf of any private organization that would subsequently earn rental revenues from a federal government contractor. Given these facts, could the City of Aiken be involved in a misappropriation of state funds by allowing Aiken Corporation to own the building on its own property?

There is an alternative to avoiding any real or perceived appearance of a misappropriation, and the current pathway that has already involved arduous and costly long-term lease negotiations between Battelle and ACorp—which so far have yielded only a commitment to negotiate for a series of one-year leases. Should such an agreement ever emerge between the two, it would still have to be approved by the DOE/SRS contract administrator.

The alternative, which has been presented to State Senators Tom Young and Shane Massey (3), is as follows:

1. Since the justification for the $20 million in state funding resulted from South Carolina’s commitment for the Universities’ participation in the Battelle contract, the facility should be built for the Universities; not for any private, rent-seeking organization. Since the City of Aiken controls the funds, its procurement department could be tasked with the design and construction process.

2. After completion of the facility, the property and/or building could be donated to a state Universities member, such as the University of South Carolina at Aiken (USCA); which would then provide the office space to the current SRNL contractor at no cost—as originally intended. The contractor would only be responsible for the utility and maintenance costs.

If a new contractor emerges in five to ten years that chooses to forego its use, the office facility could remain in the hands of the Universities and continue to provide the long-sought connectivity between USCA and downtown Aiken. Or it could revert back to the City for its use or sale.

One caveat would have to be that any Battelle-led consortium could not claim the workforce development facility as an asset in future contract bids; the option to continue to occupy the building on a rent-free basis would have to be made available to any future bidder.

This option not only removes the costly and difficult process of DOE and SRNL representatives negotiating a long-term lease with a publicly funded, private entity, it also removes the necessity of relying upon annual federal funding to pay the lease. The building would still be occupied by some SRNL employees and the intended “rotating group of university faculty, students and researchers.” There would just be no rent expected from a federal contractor whose budget is subject to the whims of Congress and DOE.

As for the Aiken Corporation’s Newberry Street, NW, property, part of the $20 million could be used by COA to buy that property. The City could still select another property, such as a portion of the nine acres of the County-owned “old hospital” property (Figure 3) currently under contract to the Turner Development company. After all, City Council has yet to approve the ACorp’s Newberry Street location as the location for the $20 million project. 

(Note: For further background on the plutonium settlement disbursement process and the rent-free alternative, see Footnote 2)

Figure 3: The “Old Hospital” property at 828 Richland Avenue, West, was the most popular choice for a future SRNL Workforce Development office building.


A Project Gone Awry.

 The SRNL/“Mixed-Use” project to date has mimicked the practices that ultimately contributed strongly to the failure of Project Pascalis: secret proceedings leading to a decision, with public input of any kind allowed only after the decisions were made. The project also evolved into an unrecognizable version from the original publicly presented proposal, during which Aiken City Council oversight was lacking.

As described in Three Missing Pages, following the cancellation of Project Pascalis, city staff surreptitiously recruited the Aiken Corporation to pursue the project by using property owned by the Aiken Municipal Development Commission (AMDC). On December 9, 2022, ACorp President Buzz Rich signed a city staff-approved contract with the architectural firm of McMillan Pazdan and Smith (MPS) to begin work on the project. The AMDC had no involvement in the decision to utilize its properties in this manner.

Aiken City Council then met in two closed-door Executive Sessions to discuss the project, and subsequently withheld its very existence and its proposed location on disputed Project Pascalis properties during two public meetings in January 2023. Council finally choose to inform the public of their decisions at then-Mayor Rick Osbon’s January 23, 2023 “State of the City” address. The SRNL downtown project announcement came one week after Council made promises to pursue a “reset” and fresh start on a path forward for the Pascalis project properties during a special-called meeting.

The role of the Aiken Corporation was not even hinted at during the “State of the City” address (Figure 2) despite its existing contract with MPS. Its role as the probable developer and building owner was not revealed until March 13, 2023–four full months after being silently recruited to tackle the task.

Aiken City Council’s unofficial delegation of the project to the third-party Aiken Corporation was made months before deliberation and approval of the $250,000, no-bid contract. Council’s decisions caused a one-year delay in pursuing a final path for the Hotel Aiken and other Pascalis properties. 

In the end, the contract eventually led to a recommendation by Aiken Corporation to use state-obtained funds legislatively allocated to Aiken County and passed on to the COA to locate the project on ACorp property for the benefit of ACorp. Aiken City Council has yet to officially validate this self-serving recommendation beyond unofficially failing to object to it.

Figure 2: SRNL’s Director Dr. Vajid Mahiji addressing the crowd during the State of the City address, January 23, 2023. At the time, the word “Mixed-Use” was absent from the discussion.


Summary

The original purpose of the $20 million was not to build a private “mixed-use” office building. It was not to further subsidize the City of Aiken nor its private partner the Aiken Corporation with an annual flow of federal financing that could be better put to other purposes.

The legislative intent was to construct “off-site infrastructure” for an institution whose operating contractor includes the state’s university system. The only justification for awarding plutonium settlement funds for use by one of the Defendant’s institutions, SRNL, was that the state had committed to an investment in the Battelle-led alliance with state Universities. That commitment specifically included a workforce development facility from the Universities and for the alliance.

The Universities, in their role as alliance members, should be the ultimate recipient of this funding

Aiken City Council should recognize that its decisions, coupled with a lack of adequate oversight, in downtown redevelopment efforts have only caused delays in the redevelopment of the Hotel Aiken as well as an updated Aiken County judicial system infrastructure, divided the Aiken area community, and disrupted the lives of numerous small downtown business owners.

Council could take an entirely different path of in-house management of any developments on city property by ceasing to farm out vital tasks to third-party intermediaries. It could also do the right thing by eventually gifting the $20 million workforce development office building to its intended owner, the state’s University System, and stop describing it as a generic “mixed-use” building.

Twenty million dollars of federal treasury funds is at stake in this process. Beyond maybe selling property for project use, should any private organization whose by-laws fail to identify the COA or Aiken County as “shareholders” be allowed to profit from this publicly-funded project? Should $20 million be spent without any future restrictions on the use of the building should SRNL stop renting space? Or should the money be spent for the common good, in support of higher education? 

The County legislative delegation and the City of Aiken still has time to reverse their support for the current private, rent-seeking alternative and choose to make the facility a true public asset.

Footnotes:

(1) Details of the Aiken Corporation’s purchase of its Newberry Street, NW property is contained in Aiken’s Cousin Problem. 

Not reported in that story was the probable collateral for the Newberry Street property; a 25-acre parcel of land between North York Street and Kershaw Street, NE, that is now owned by Aiken Corporation. According to Aiken Corporation meeting minutes from November 2021, the original owner of that property wished to donate it to the City of Aiken, but instead city staff opted to allow Aiken Corporation to accept the land donation.

According to a City of Aiken Economic Development Department monthly reports, at the time of the Aiken Corporation’s $650,000 Newberry Street property purchase, the 25-acre parcel was under contract for $625,000; enough to pay off the entire loan.

By the end of 2022, that contract with the Auben Company was cancelled. In June of 2023, the ACorp Board voted to accept an offer of $437,500, which closely corresponded to the appraisal conducted to quantify the size of the donation for IRS reporting purposes. 

The property is currently proposed for single family housing and commercial use by High Brass Development, LLC. The Aiken Corporation sale will be executed after City Council approval of the High Brass concept plan. ACorp would then be able to pay off two-thirds of its $650,000 loan.

(2) The following is an updated summary of information first reported in Offsite Infastructure.

Further Background on the Plutonium Settlement Disbursement Process and the Rent-Free SRNL Project Alternative.

On August 30, 2020, the State of South Carolina reached its landmark, $600 million settlement with the U.S. Department of Justice. 

Now commonly referred to as “The Plutonium Settlement,” the action was the result of the Department of Energy (DOE) failing to meet the terms of Amendments made to Defense Authorization Acts that mandated the removal of one ton of plutonium per year from SRS if a planned Plutonium/Mixed Oxide Fuel Fabrication Facility (MFFF) was not operational by 2016. Failure to remove the plutonium triggered upwards of $160 million per year in fines to be paid by the federal government to the State of South Carolina.

DOE now has until 2037 to remove surplus plutonium brought to SRS from other nuclear weapons complex sites, a process that complied with DOE’s 1997 legal decision to consolidate all “non-pit” surplus plutonium at SRS.

Following the settlement, SC Attorney General Alan Wilson immediately granted $75 million of the funds to three law firms (later reduced to two) managing the litigation leading up to the settlement.  A legal challenge to that decision currently remains in state courts, but the first decision was favorable to the AG’s office.

As described in Off-Site Infrastructure, intense competition for the remaining $525 million in funds followed the settlement, with a final ldecision not reached until the end of the 2023 legislative session.

The competition included one of the Defendant’s institutions, the Savannah River National Laboratory (SRNL), lobbying for a lion’s share of the funds. The justification for that lobbying effort was the SRNL operating contract between DOE and Battelle Savannah River Alliance (Battelle).

On December 20, 2020, DOE awarded the Battelle-led alliance the $1.9 billion, five year contract to manage and operate SRNL, with an option to extend the contract to ten years. The alliance is comprised of the Battelle corporation, which operates, or assists in operations at, numerous other national laboratories; and five regional universities: the University of South Carolina, Clemson University, South Carolina State University, Georgia Institute of Technology, and the University of Georgia. 

One contract provision involved investments by the various BSRA partners. The State of South Carolina, on behalf of its University system, committed to making “a substantial investment to support DOE and SRNL,” that included a “possible infrastructure investment colocated with SRNL to support workforce development.” (Section J-14 of the contract).

One year later, Governor Henry McMaster was happy to oblige that wish. In a December 9, 2021, letter, to House speaker Jay Lucas and Senate President Thomas Alexander, Governor McMaster presented his proposal for ensuring “the communities surrounding SRS be the prime beneficiaries of these settlement funds.”

Governor McMaster proposed spending twenty percent of the total plutonium settlement on SRNL, writing:

The one-time investment of $120 million will be used over the next five years by the alliance to hire scientists, grant scholarships, and upgrade equipment at SRNL, as well as for the construction of a new facility to house the alliance at SRNL.” 

The state legislature was clearly reluctant to invest one-fifth of the settlement on the Defendant, but eventually settled on an allocation of $20 million for “SRS/National Laboratory Off-Site Infrastructure and Innovation District.” This allocation more than met the state’s commitment in the BSRA contract.

The allocation was for off-site infrastructure, with no strings attached in terms of future leases or revenues. The funding did not specifically allow for a commercial building constructed on behalf of any private organization that required a lease arrangement with a federal government contractor. The only justification for the allocation was to meet obligations made by the state on behalf of its major universities.

(3) On September 15, 2023, I emailed a letter to Senators Tom Young and Shane Massey, asking them, in part, the following:

It is increasingly evident that the $20 million allocation from SRS/plutonium settlement funds that was awarded to the City of Aiken is no longer specifically for an SRNL facility. How is this not a misappropriation of funds?”

There was no formal response to the letter.

A subsequent, October 3, 2023 letter outlined a case against the Aiken Corporation being tasked with the project, arguing, in part, that an organization mostly involved in six-figure projects should not be suddenly tasked with an eight-figure project. 

These letters are available on this page.

One Year Lease After One Year Lease… for the New, $20 Million, City-Funded Aiken Corporation Office Building.

The Department of Energy’s Savannah River Site (DOE/SRS) has only authorized the Savannah River National Laboratory’s (SRNL) management and operations contractor to pursue a series of one-year leases for space in the proposed $20 million “Mixed Use” office building that is currently under predevelopment by the Aiken Corporation.

While the publicly-funded downtown project keeps shrinking in size while costing the same, Aiken City Council is allowing Aiken Corporation to pursue further development before city staff has even prepared another no-bid contract for Council approval.

By Don Moniak
January 7, 2024

Aiken City Council is scheduled twice to discuss the proposed $20 million “Mixed Use” office building, also known as the “SRNL project,” during its January 8th regular meeting, The first, and more important, discussion is scheduled to occur behind closed doors during an Executive Session. The second discussion is a public hearing much later in the meeting. Both agenda items involve the relationship between the City of Aiken (COA) and the Aiken Corporation (ACorp) as it pertains to the SRNL project.

In March 2023, Aiken City Council signed a no-bid, $250,000 contract with the Aiken Corporation for predevelopment work on a proposed Savannah River National Laboratory (SRNL) “workforce development” office building.  The scope of work for that contract was reportedly completed with the issuance of a “feasibility report” and a site location recommendation by Aiken Corporation. 

The contract also authorized ACorp to negotiate lease agreements with “third parties.” The only known third party at this time is SRNL, which is fully owned by the U.S. Department of Energy, but managed and operated through a contract with the Battelle Savannah River Alliance (Battelle).  Both DOE/SRS and Battelle must reach a mutual agreement for any facility leases.

Between the March 2023 COA/Acorp contract agreement and the September 25th site location recommendation, the proposed facility size shrunk from 45,000 square feet to 36,000 square feet, the project was rebranded as a generic “Mixed Use” spec building, while the estimated cost remained at $20 million. Now, ten months later, ACorp has only managed to obtain a commitment to negotiate a series of one-year leases; but has yet to report the signing of any Memorandum of Understanding.

Aiken City Council is presently allowing ACorp to move forward on the next stages of the $20 million project that is being funded with South Carolina’s plutonium settlement funds. Yet, Council has not approved the recommended facility location, nor does it have have a contract with ACorp to continue further development work.

The Closed Door Session

The first discussion is scheduled as a closed-door Executive Session to “to discuss a proposed contractual arrangement with the Aiken Corporation regarding the Savannah River National Laboratory (SRNL) downtown building project.” The justification for closing the doors is that the discussion involves “negotiations incident to a proposed contractual arrangement.” 

South Carolina’s Freedom of Information Act allows for this vague exemption, but also allows public bodies the freedom to discuss these issues openly and in full public view. If City Council chooses to close the doors Monday evening, it will be opting to privately discuss the expenditure of millions of public monies on a publicly funded, private organization (ACorp) that, in turn, will seek to extract hundreds of thousands of dollars of rental revenue from a federal contractor subject to the vagaries federal budget shaving.

According to two letters in the meeting agenda documentation, there is no proposed contract, only a commitment to negotiate a contract. Battelle is only authorized by DOE/SRS to pursue a base one-year lease with options for up to nine one-year renewals with ACorp. The lease renewals are obviously dependent upon the availability of funds in DOE/SRS/SRNL annual budget.

In a December 14, 2023 letter, DOE/SRS granted Battelle  “preliminary approval to move forward with the procurement action in support of real property leased space from the Aiken Corporation.”

The DOE/SRS approval letter was in response to a December 11, 2023, letter (Figure 1) from Battelle requesting:

Programmatic Approval to move forward with a procurement action in support of real property leased space from the Aiken Corporation for a one (1) year base period lease estimated at $375,000 (to) $425,000 per year, with nine (9) additional (1) year option periods. The request is for approximately 25,000 square feet of office/collaborative space located in a future building in downtown Aiken with a projected cost of $15-$17 (per square foot). “

By comparison, the Amentum Company presently has a three-year lease at $20,500 per month ($246,000/year) for 20,000 square feet of office space in the ACorp’s Newberry Street building adjacent to the Aiken Performing Arts Center. Amentum’s square foot rate per year is $12.30, nearly one-third less than the upper rental rate under consideration by Battelle.

Battelle’s December 14th letter also contained the company’s first public reference, since the project was announced last year, that it is contractually obligated to provide an office building focused on workforce development (1):

This future building was identified in BSRA’s proposal to manage and operate SRNL.”

Figure 1: Letter from Battelle Savannah River Alliance to DOE/SRS



The Public Hearing

The second discussion towards the end of the meeting will be a public hearing on the “First Reading of an Ordinance to Amend the FY-2023-24 Budget to Include $20 million of SRS Settlement Funds.”

The supporting memorandum (Figure 2) for the ordinance describes DOE’s, “conditional approval (for Battelle) to begin discussion with Aiken Corporation on a lease to occupy a portion of a ‘mixed use’ building in Aiken to be built on a currently vacant lot on the 100 block of Newberry Street, NW.”

As stated earlier, the ACorp’s Board has only recommended building the office building on its Newberry Street vacant lot. Aiken City Council has yet to act upon that recommendation which contradicted the originally specified location.

The memorandum goes on to state that, “City Staff is working with Aiken Corporation on an agreement that will be before Council at a future meeting in February.”

By that time, Aiken Corporation is expected to have chosen a firm for the million dollar plus job of designing this proposed $20 million “Mixed Use” facility; for which it only has one potential tenant that is unwilling to commit to more than a one-year lease.

Figure 2: Supporting Memorandum for the $20 million budget amendment ordinance



Aiken City Council’s Cycle of Private Permission and Public Forgiveness

The existing situation is strikingly similar to the early stages of the project in December of 2022, when Aiken City Council met behind closed doors with ACorp and SRNL representatives. That meeting occurred after the ACorp had already signed its contract with the architectural firm of McMillan Pazdan and Smith to begin project work.

Council then withheld the existence of the updated project for more than a month.It’s contract with ACorp was not approved until three months after it secretly sanctioned the ACorp/MPS contract; that approval also allowed for reimbursement of project work during the three months preceding the COA/ACorp contract.

Today, Aiken Corporation is moving forward on a Request for Proposals for Architectural Design Services, even though the organization has no contract with the City of Aiken to pursue such services which are expected to easily exceed a million dollars.

Within a span of thirteen months, Aiken City Council has twice allowed ACorp to race ahead of Council’s official decision-making process; the latest example of this public body granting permission to a “partner” before seeking public approval, or forgiveness, of its decisions. 

When it comes to downtown, Aiken Corporation continues to set the agenda, while Aiken City Council keeps following. The difference today is that instead of hundreds of thousands of dollars being involved, $20 million is at stake.

Footnote:

(1) Details of this contractual provision and the subsequent lobbying of plutonium settlement funds can be found in Offsite Infrastructure .

Driving Around Pantex. The Little Nuclear Weapons Plant on the Prairie.

A look at Savannah River Site’s weapons production colleague.

by Don Moniak
January 1, 2024

The Pantex Plant in the Texas Panhandle is about one-twelfth the size of the Savannah River Site (SRS) but stores five times more plutonium. Most of this plutonium is tentatively scheduled to be shipped to SRS over the next twenty to fifty years. Any major accident at Pantex could accelerate that ever evolving schedule.

The U.S. Department of Energy’s (DOE) Pantex nuclear weapons assembly and disassembly plant in the Texas Panhandle has been the sole endpoint in the nation’s nuclear weapons complex for nearly fifty years. After the first Cold War ended, the cessation of plutonium production, coupled with the abrupt termination of of Rocky Flats plutonium (Pu) pit production left Pantex as both the beginning and the end of the weapons complex. Or, as DOE puts it, All Roads Lead to Pantex.

Pantex is also the home for the nation’s supply of primary nuclear explosive “triggers”—quaintly known as plutonium pits—that have been removed from the nuclear weapons stockpile. Each pit is estimated to contain an average of three kilograms of plutonium-gallium alloy.

Although the approximate number of pits stored at Pantex is now classified, it is estimated there is anywhere between 17,000 and 20,000 currently stored in WWII-era bunkers. An estimated 11,000 to 13,000 are surplus to military needs; thousands more are in a strategic reserve and categorized as “national security assets.”

The future of SRS plutonium operations begins at Pantex. First, the renewed plutonium pit production mission, currently planned for SRS and Los Alamos National Laboratory (LANL), is reliant on the strategic reserve pits. Second, the 35-40 tons of plutonium in surplus pits remains tentatively scheduled for shipment to SRS for disposition into various waste forms, as it has since 2000. (1)

The difference between Pu at Pantex and SRS is four-fold. First, at 200,000 acres, SRS is twelve times larger in area than the relatively tiny, 16,000 acre Pantex plant. An accident at Pantex would have bad consequences for neighbors, especially since all the neighbors are farmers and even the rumor of crop contamination can have a disastrous economic affect. SRS has a miles-wide buffer between its high-consequence radiochemical operations and materials storage and the nearest residents.

Second, the plutonium-gallium alloy contained in pits is considered the most stable phase of plutonium, whereas SRS has what is essentially the Cold War’s Pu dregs; which require a more rigid level of monitoring, and are more difficult to process.

The only time Pantex has processed loose plutonium was in response to an accident. This well known fact once led former SC Senator Strom Thurmond to foolishly refer to Pantex worker as “amateurs.”

Third, Pantex sits on the dry, windswept prairie of the Texas Panhandle, (Figure 1) not hidden within humid and dense southeastern forests.

Finally, the State of Texas has accepted the long-term mission of storing sixty plus tons of plutonium in a small area of the Texas Panhandle for up to fifty years; whereas the State of South Carolina objected to its essential long-term storage role, but only after it was no longer tied to the long-term and lucrative production job called MOX fuel fabrication.

Figure 1. Pantex Nuclear Weapons Plant and surrounding high prairie farmland. Neighbors farmed “right up to the fence.” Google Earth)

On the Llano

The Southern Great Plains of Texas consist of a broad plateau known as the Llano Estacado. The LLano sits above the Southern Ogallala Aquifer and is often referred to as the “world’s flattest mountain.”

The Llano has a steady undulation imperceptible to newcomers. It is dissected in the South by canyons of various depths, the most notable being Palo Duro Canyon. The natural vegetation is mid-grass and tall-grass prairie. (Figure 2)

It is dotted by shallow depressions containing ephemeral to intermittently-occurring bodies of water known as playas (Figure 3). The playas attract large flocks of migratory waterfowl and can get deep and full enough to water ski.

It is the kind of place where darkness can be viewed to the east before the sun sets in the west. Smoke from wildfires in native prairie and conservation reserve grasslands appear deceptively close, when it is actually very distant. Grain silos are visible from miles away and act as landmarks.

The country is predictably laid out in square grids. Drive around a square enough times and it seems circular. It is only a twenty-mile drive around Pantex—twenty minutes if in a hurry, or an hour while sightseeing.

Figure 2. Conservation Reserve Grasslands on the Texas Panhandle. USDA photo.
Figure 3: Aerial view of ephemeral ponds known as Playas. (Photo by TNRCC)

Pantex Plant

The windswept, dry, open prairie is surprisingly not a bad place to mask the presence of a nuclear weapons assembly plant. Unlike grain silos, the low physical profile of the Pantex Plant makes it unnoticeable from long distances and even unobtrusive from its barbed wire fences.

The primary tasks at Pantex are disassembly of retired nuclear weapons and reassembly of existing models in the nuclear arsenal.

The latter includes utilization of fresh canisters of SRS-produced tritium gas which boosts the destructive power of primary nuclear explosives ten to twenty-fold; highly enriched uranium subassemblies from Oak Ridge which are necessary for secondary nuclear explosions; and hundreds of replacement nonnuclear parts from the Kansas City plant.

Development, testing, and fabrication of high explosives weapon components constitute another militarily critical role at Pantex. Pit storage and monitoring is perhaps the most passive task.

Pantex’s origin was obtrusive and controversial to many. Just as thousands were displaced from Aiken, Barnwell, and Allendale Counties to make way for Savannah River Plant, Pantex was founded on land seized from mostly German immigrant farmers to construct a World War II munitions plant.  Many of the WW II bunkers remain at Pantex, stocked with pits and used for temporary weapon storage.

The seized Pantex lands were not returned after the war, fostering a lingering resentment by the dislocated families that endured for at least half a century. The munitions plant was converted in 1951 to a nuclear weapons assembly site with a major high explosives testing and development role.

Proctor and Gamble was Pantex’s first operating contractor, and many locals came to believe it was a detergent plant. P&G reportedly left after five years to avoid its family friendly products from being associated with the bomb, and was replaced for nearly the next half-century by the Mason and Hangar Company.

Pantex is the only plant in the U.S. nuclear weapons production complex where an inadvertent nuclear explosion can occur, though it is such a remote possibility that it was deemed as “beyond credible” until the turn of this century.

Figure 4: Early scene from The Plutonium Circus

The Perimeter Tour: Cells, Bays, Firing Sites, Center Pivots, and Pits.

The best starting point for a drive around Pantex is also the closest point from the Amarillo airport, the nearby maximum security prison (where the inmate population was not considered in Pantex radioactive exposure analyses for years), and an IBP meat processing plant. The airport sits only miles away and the risk of an aircraft crash into pit and weapon storage bunkers was a fierce and persistent subject of debate for years.

Huge industrialized pig farms emerged as a major industry in the 1990s in counties north of the plant. Though these farms are visually unobtrusive in the landscape, their all-encompassing stench is most certainly not. In early 2000, a truck carrying dead pigs too far gone for rendering stopped suddenly at a traffic light west of the plant, causing its cargo to fly over the top of the cab onto the highway, a comical confluence of three economic mainstays of the Amarillo area—plutonium, prisons, and pigs.

The route around Pantex, heading west to east at the start, involves three left turns. Jim Hightower, the former Texas Agricultural Commissioner turned pundit, is credited with the saying, “As my mother used to tell me, two wrongs don’t make a right. But I soon figured out that three left turns do make a right.’

The west-to-east route on the southern boundary is also the route used in the motorcycle scene of the locally famous docu-comedy The Plutonium Circus. (Figure 4)

The 160-640 acre farm parcels on the south side of the road are interrupted only by the historic Peace Farm, a ten-acre tract where members gathered for years to bear witness to weapons transports.

A few miles further east is the first left turn. The first farm site on the right was once owned by Lee Cockrell. In the early 1990’s, Lee was one of the few farmers who supported a Pantex expansion that included a plutonium pit production role, and criticized neighbors who did not. The situation changed later in the decade when a plume of groundwater contaminated with hexavalent chromium polluted his drinking water well and he started breaking out in hives.

Within two years Pantex officials alienated Mr. Cockrell. He became a persistent, formidable critic who always carried a sheaf of his documents. Soon Department of Energy officials, who for years had claimed the contamination would never migrate “off-site,” ended any remaining fondness for Lee.

Catty-corner from Cockrell’s old place is DOE headquarters, the only building with public access, and one of the few facilities easily visible from the road. (Figure 5)

Figure 5: Pantex Headquarters. (Google Earth/Street Scapes)

A mile or so further north, the main plant with its array of “cells” and “bays” enters the view, but still remains inconspicuous. There are six cells in Zone 12, five of them operational. (Figure 6)

The cells, also known as “gravel gerties,” are host to the most sensitive and delicate weapons assembly and disassembly work. The ~115-pound high explosive package is “mated” onto the plutonium pit during assembly, and removed during disassembly. On rare occasions, there can be issues like one in 2005 when there was an “unexpected cracking of a high explosive main charge during disassembly.”

Numerous detonators and actuators that are removed during disassembly and replaced during reassembly are also sensitive to everything from static electrical discharges to more powerful electrical surges during lighting storms.  Any component involved in the detonation process that “functions as designed” is an unwelcome occurrence.

The operations involve a three-person crew of production technicians (PTs). One technician serves as a procedure reader, and the other two follow each thoughtfully-produced procedure to perform the warhead assembly or disassembly according to plan. (Figure 7)

Not following the procedure, or the discovery that a procedure needs adjusting, can result in a work stoppage, where the weapon is placed in a safe configuration and an investigation ensues to chart a path forward.

In earlier days the high explosives were more sensitive, meaning a dropped package of 115 pounds of advanced high explosives were more sensitive to fire and could more easily explode on impact. The cells are designed to collapse during such an event to trap as much of the plutonium and other resulting radioactive debris as possible, and the three workers inside would never be found.

No such event has happened, but in 1978 three workers were killed and never found when a much smaller amount of high explosives detonated during a machining operation in a test facility.

Figure 6: Aerial view of the array of weapons disassembly and assembly cells and bays. The cells are the conical-shaped buildings . (DOE Stock Photo)

Figure 7: View of the three-person rule in place during Pantex production work. State of Texas Archive Photo.

In 1988, a major accident in a cell did happen and rendered the facility useless for decades. During disassembly, a small electrostatic discharge caused a non-nuclear part that releases tritium gas from its container to “function as designed.” Four grams of tritium with 40,000 curies of radioactive beta particles were released in the small space, and then vented to the outside environment. DOE did not notify Pantex neighbors of the release.

In 2010, another previously unthinkable event happened when heavy rains created a half-foot of standing water in nuclear explosives facilities. Earlier Pantex safety analyses had found that flooding was not a “potential event initiator.” No accidents occurred, but the event caused a major reexamination of previous safety assumptions and analyses.

Bays

Bays are additional assembly/disassembly areas focused on the array of components and parts found in any weapon. Violations of nuclear explosive procedures or the need for new procedures is as common in bays as they are in cells.

One of the more extreme accidents in a bay was the destruction of a weapon, meaning it was rendered useless. In 1997, during disassembling a B61 Mod 3 nuclear warhead, the procedure for a different weapon modification was used. When it came time to remove one component, technicians heard a loud boom, saw smoke, and smelled an acrid odor. The Pantex public relations department minimized the experience by describing it as a ‘pop and an odor.”

The cause remains classified, but by 2000 reports of “destroyed weapons” emerged. DOE would not confirm or deny that the loud boom, smoke, and acrid odor were the result of a “weak link” functioning as designed. Weak links are weapon parts designed to disable and render a weapon useless when unauthorized energy is introduced into the system.

Eight years later, there was a “disassembly abnormality” in a cell when, during “separation of a weapon subassembly, a component snapped and the tooling applied a force to a main charge in excess of the procedural limit.” The initial report included the fact that a detonator cable had been accidentally pulled out of a detonator assembly. In yet another report, the problem was further refined as, “high explosive main charges separat(ing) at an unexpected step in the disassembly process.” Two months passed before progress was made on final disassembly. There were later public reports that the incident could have led to an accidental nuclear detonation, but DOE would never publicly confirm such a scenario.

Figure 8: The former Osborn family farm. (Google Street Scapes)

After passing the receiving area known as Building 16-12 is another left turn. 

The first farm on the right is the former home of Jim and Jeri Osborn. (Figure 8). The couple lived amiably with Pantex as a neighbor, even when large chunks of metal from outside explosives testing landed in their fields. Jim used to show off the heavy chunks to visiting journalists.

Visible in the short distance is the small “firing range’ where larger experimental explosions are performed. Much smaller experimental explosions occur within an indoors testing facility, where high-tech monitoring devices generate detailed images of the explosions. Also nearby are the old burning grounds, where about fifty tons of high explosives were annually burned in open pits for various reasons—declassification of shape, demilitarization, and hazard reduction. Exposure to neighbors were minimized by Pantex PR officials for decades.

The always tenuous relationship among farm families who predated Pantex intensified when DOE proposed plutonium processing missions. Unlike SRS, Rocky Flats, Hanford, and Los Alamos, Pantex had only handled plutonium contained within the sealed pits. The only time it was handled as a powder was when a pit accidentally cracked during disassembly. (2)

The Osborns’ relationship worsened in 1994 when Pantex set off a massive explosives charge less than a mile from their home during an emergency drill. The blast was far more powerful than the normal window-rattling tests which the family was accustomed to enduring. The explosion damaged the foundation and strew paintings and kitchenware around the house. The event was widely perceived as an act of reprisal for the Osborns’ outspokenness.

Due to the combination of DOE’s refusal to accept responsibility, and the lack of attorneys willing to take on the gargantuan national security bureaucracy and its arcane information classification system, the Osborns were forced for several years to argue their case in the court of public opinion. The couple began ending public comments to DOE with the phrase, “if their lips are moving, they’re lying.”

Then it was discovered that the explosion happened during an emergency drill in which a neighbor was hypothetically impacted, but the drill was only supposed to involve a miniscule explosives charge. A previous Lawrence Livermore National Laboratory report was also discovered that described the maximum safe charge at a one-mile distance from a home as about one-eighth the power of the emergency drill explosion. Enough information had accumulated to compel DOE to finally settle, though only for a pittance and without an admission of culpability.

West of the Osborn place is a short, small rise. A health researcher from the humid east, fresh off the plane and already confused by the big sky and long horizons, once incredulously looked at it and asked his hosts ‘WHAT RISE?” as if it was a joke.

At the top of the rise further west is a farm where a young family once lived and farmed. Their well water was contaminated by high explosive residues and solvents. That too was never supposed to happen.

Plant officials had long claimed that a ‘perched aquifer with high levels of explosives and solvents contamination was isolated and not connected to the Ogallala Aquifer. As neighboring farmers had informed DOE for years, that was not the case. To make matters worse, DOE and state regulators failed to publicly disclose the findings for three months.

The Scenic Pit Storage View

Just west of the rise is one of the better, though still limited views (Figure 9) of the physically low profile weapons and plutonium storage bunkers. Over a small playa is Zone 4, where the plutonium that is scheduled to someday head to SRS remains in seventy to eighty-year old storage bunkers that largely lack temperature and humidity controls.

The DOE’s Record of Decision (ROD) opting for long-term (up to fifty years) storage of surplus pits at Pantex was made in January of 1997. The same ROD included selection of Savannah River Site (SRS) for long-term (up to fifty years) consolidated storage of surplus non-pit plutonium metals and powders.

SRS’ candidacy for long-term surplus pit storage ended with that decision, in large part because thousands of non-surplus “national security assets” were also to be stored at Pantex.

Problems with pit storage have been documented since the 1990’s. Most bunkers are of WW-II origin, and many of them (Figure ) have no humidity or temperature controls, this in a region with staggering climate extremes. They are also even prone to flooding.

Until the early 2000’s the pits were not stored in sealed containers, contrary to the directives of National “design agency” Laboratories which specified that, “no pit should be stored an appreciable period of time in these (unsealed) containers.”

In 1999 the Defense Nuclear Facilities Safety Board issued Recommendation 99-1, Safe Storage of Fissionable Material Called Pits.
The Board emphasized the need for storage in sealed containers to prevent corrosion of pit cladding; in addition to thermal monitoring to avoid excessive, damaging temperatures in the bunkers, and improved facility storage for the thousands of strategic reserve pits that had accumulated by 1999, and have continued to accumulate to this day. The Board wrote the following about the investment and existing value of the militarily critical pits:

Pits in the strategic reserve at Pantex have great value to national defense. These pits, manufactured at great cost and great effort by the Department of Energy and its forebears, are probably only second in importance to nuclear weapons in the military stockpile. In the nuclear weapons defense system, they are effectively irreplaceable. Their assured safe protection should be a vital component of national defense.

Thus, a cabinet agency that constantly tried to justify the need for new pits retained a policy of substandard care of potential replacement pits.

Figure 9. Plutonium pit storage bunkers on the low horizon. Google Street View
Figure 10. Pantex Zone 4 Bunkers where plutonium pits are stored and some weapons are staged pending disassembly, monitoring, or reassembly.

Recommendation 99-1 was closed in 2005 after Pantex managed to repackage more than 97 percent of the pits into sealed containers, and improved thermal monitoring was implemented.

But by 2022, as the inventory increased another ten percent over 2014 levels, up to fourteen percent of all pits were described as being in unsealed containers. If the pit storage limit of 20,000 has been reached, that means that upwards of 3,000 pits are stored in substandard conditions.

Still, despite the difficulties, there is no outcry from the State of Texas demanding early removal of the pits. This contrasts with South Carolina, where fears of plutonium storage at the most experienced site in the country were exploited by political leaders to extract a $600 million settlement from the federal treasury; and also foist some materials upon less prepared nuclear weapons reservations like the Nevada Test Site. 

If DOE begins to depopulate Pantex of its pits, well-equipped SRS will face some of the same difficulties.  It will have to accommodate pits with high heat production or whose cladding is not fire resistant—a substantive concern if pit disassembly ever reaches SRS.

Figure 11. Plutonium pit containers and schematic of storage. From Pantex Pit Inventory.


Two more miles, past a group of center pivots, is the final left turn. The second farm on the right, with Pantex on the left, is owned and operated by Doris and Phil Smith.

Doris and Phil Smith were at time’s Pantex’s biggest nightmare—life long third-generation farmers, solid citizens, and knowledgeable, formidable speakers. Phil’s thundering but steady voice reverberated through meeting rooms, especially as he described DOE’s chronic arrogance towards the people. Doris would recite technical issues about groundwater, plutonium, and tritium before often ending with “We grow food for the world, you build weapons to destroy it.” In 2017, she told the Amarillo Globe-News, “(Pantex) didn’t necessarily lie to you — they just didn’t tell you the whole truth.”

Doris was also a promiment local artist, whose “Midnight Mass” painting of their beloved St. Francis of Assissi Church adorned many homes across the Panhandle and beyond. The original hung in the entrance way of the church. Adjacent to the church is the community center where semi-annual dances were held.

A former pastor of St. Francis, Bishop Leroy Mathiessen, once urged Pantex workers to leave their weapons jobs, and offered assistance in finding new work. In 1998, on the same day that Bishop Matthiessen received an award in Washington D.C. from an alliance of nuclear weapons plants neighbors, somebody lit the church on fire and it burned to the ground. The arsonist was never found.

A few miles to the west of the plant’s southwest corner, where the drive around Pantex ends, the new St. Francis of Assissi church stands on its original ground. No money from the Pantex contractor was accepted for the reconstruction.

Footnotes

(1) Originally, pit plutonium was to be processed into a plutonium/mixed oxide fuel (MOX), a mission which devolved into a prime example of a failed mega-project. Now, plans are for processing the 27 to 34 tons of surplus pit plutonium into a less complicated waste form, simply labeled as “dilution.”

As described in Plutonium is Not for Amateurs, this planning began in the mid-1990s and has yet to progress past the pilot stage. SRS currently processes about 0.3 tons/per year at its K-Area plutonium waste production area. Although it must be noted that the current slow rate is influenced by prioritization of the most difficult materials, it could still take up to more than 30 years to finish processing the ~11 tons of plutonium presently stored in K-Area.

While South Carolina political leaders cried foul in the mid 2010’s over the continued presence after fifteen years of a mere eleven to twelve tons of plutonium at SRS, the much larger plutonium stockpile at Pantex has continued to grow for the past twenty years due to continued weapons disassembly work dictated by nuclear weapons treaties with the former Soviet Union.

(2) The cracked pit was a Livermore National Laboratory-designed pit. Livermore had a reputation for designing weapon components that were more difficult to disassemble because they were only designed to be used.

Notes

Texas Monthly’s Disarmed and Dangerous is the best long-form journalism about Pantex in the 1990’s, the “boosters” and the “bashers,” and living near daily explosions.

Don Moniak worked for Serious Texans Against Nuclear Dumping (STAND) of Amarillo for four years. STAND was an informational and advocacy group monitored current and proposed work at the Pantex Plant and provided assistance to other communities affected by proposed radiochemical dumping plans. STAND also worked with PANAL and Peace Farm to produce The Nuclear Examiner, a monthly newsletter with a mailing list of 3,500 interested parties.







Humana or Humana?

Savannah River Mission Completion (SRMC) heralded Medicare open season enrollment with letters announcing major health insurance changes to hundreds of SRS retirees.

By Don Moniak

October 19, 2023

In early 2022, a newly formed company called Savannah River Mission Completion (SRMC) was awarded a ten-year contract worth up to $21 billion to process dozens of tons of unstable “liquid” radioactive wastes stored in massive underground “tanks” up to seventy years old at the Department of Energy’s (DOE) Savannah River Site (SRS) into a more stable, manageable solid form for long-term storage and disposal.

SRMC is a consortium composed of three major partner: BWXT Technical Services Group, Inc.; AECOM Energy & Construction, Inc., an Amentum company; and Fluor Federal Services. Both BWXT and Amentum maintain corporate offices in downtown Aiken, and Amentum’s name graces the marquee of the Aiken Performing Arts Center.

SRMC succeeded Savannah River Remediation (SRR), a consortium of Bechtel, BWXT, and AECOM; so SRMC could be viewed as SRR with Fluor instead of Bechtel. SRMC inherited SRR’s pension and healthcare obligations to retirees, an obligation which includes a Health Reimbursement Account (HRA) stipend of $2500 per year for the purchase of additional medicare insurance and other medical needs. The stipend was implemented in 2012 during the last round of major changes in healthcare benefits.(1)

In addition, contractually speaking, SRMC and other SRS contractors are obligated to maintain benefits programs that “support at reasonable cost the effective recruitment and retention of a highly-skilled, motivated, and experienced workforce.” (H-6(B)(1)(b) of the SRMC contract).

A highly skilled and experienced workforce is an essential element for a safety culture necessary in any high consequence-operations; meaning a single major accident can have severe to catastrophic economic and/or environmental, safety, and health repercussions. BWXT proudly boasts of “twelve-high consequence sites managed for the government” on its website homepage.

All DOE major site contractors also are contractually obligated to maintain “Community Commitment” programs involving educational outreach, regional purchasing programs, community support such as charitable giving, and workforce and economic development.

SRMC typically articulates its Community Commitment through a steady stream of news releases from its public relations department. So far this year, the company has issued thirty-three DOE-approved news releases that pertain to community commitment programs— while only dedicating only twelve to technical issues and accomplishments.

SRMC executives such as President Dave Olsen are often shown amidst recipients of SRMC largesse which ultimately derives from federal funding.

SRMC President Dave Olson (left) posing for a Community Commitment photo-op to commemorate scholarship donations to Denmark Technical College.


Changes to SRMC Retiree Health Plans

Missing from SRMC’s news page is the recent revelation to hundreds of its retirees that their upcoming open Medicare season is being marked by a major change in benefits and coverage, a change that also includes Savannah River Remediation retirees. There is no photo of Mr. Olson smiling with a retiree as part of a public announcement of the big changes to come—in large part because retirees and their families are generally not smiling about the changes, which for many are the second benefits disruption in twelve years.

An August 31st letter from SRMC’s Human Resources Director Ted Myers to company retirees, publicly available on the SRMC website home page, outlines serious changes to health insurance plans. SRMC chose to replace both its insurance broker and HRA agent and to compel retirees under its health coverage system to enlist in a Humana Medicare Advantage Plan or Supplemental Plan in order to keep their stipend. The choices of Advantage Plans are twofold—high deductible Humana or low deductible Humana.

The letter itself is contradictory, starting off with:

SRMC was notified in late April that Right Opt and HealthEquity would no longer service our contract as of September 27, 2023. Given the short time frame for SRMC to vet and select another provider, we needed to find one of equal or greater quality and service.”

Several paragraphs later, Mr. Myers wrote that both Health Equity and Right Opt were leaving the arena entirely:

With our current partners (RightOpt and Health Equity) leaving this line of benefit service, SRMC evaluated the options and has selected Via Benefits as our new retiree healthcare partner. Via Benefits is the nation’s oldest and largest private Medicare marketplace and has helped more than 2.3 million retirees evaluate their healthcare options to find coverage that’s right for them.”

However, Health Equity is still in business and boasts of being the “#1 Health Savings Account Administrator;” and according to a similar letter sent to retirees covered by the Savannah River Nuclear Solutions (SRNS) and Battelle Savannah River Site (BSRA) health coverage systems, Health Equity will continue to administer and service their retirees’ HRA accounts.

As a result, retirees covered under both the SRNS and BSRA system are only experiencing the minor difficulty of a change in insurer brokers; and are not being compelled to change to Humana-only plans in order to retain their stipends. They are able to keep their existing plans, and not fret about whether a new insurer’s coverage extends to their medical providers. The SRNS and BSRA approach can be viewed in the SRNS August 23, 2023 letter to retirees on this page.

SRMC retirees impacted by the changes, on the other hand, were invited to attend informational meetings at the Amentum Performing Arts Center on October 4th to further learn how to navigate their upcoming health benefits changes from Humana and Via Benefits representatives; changes induced, in part, by consortium partner Amentum.



According to the SRS Retirees Association’s Facebook Group, many retirees never received the letter that included notification of the meeting, and a predictable level of discontent and confusion about the health benefits changes is prevalent.

“Notifications are not too good about benefits right now,” wrote one retiree, who also described having to cancel long-held insurance plans after his family’s Humana enrollment kicked in unexpectedly early.

When WFXG-FOX news in Augusta attempted to report on the meeting, their reporter was ushered out of the building. WFXG‘s report did contain subsequent interviews with departing retirees which further illustrated their level of discontent and anxiety:

One man says he is being made to choose a new insurance plan, a different one from what he has had for nearly a decade. Another says he isn’t sure why things are changing, but change isn’t easy when it comes to healthcare decisions for himself and his wife.”

WFXG also obtained information from SRMC communications director Dean Campbell, who reportedly minimized the impact by describing “hundreds of former employees” as “a small sector.” Campbell also told WFXG that he was “ unable to share which (benefits) company is leaving and which one will be replacing it,” even though that information is publicly available in the letter to retirees on SRMC’s website.

The treatment afforded retirees contrasts sharply with the images presented in SRMC public relations efforts that portray its Community Commitment in a perennially positive light. SRMC’s public relations has not self-reported on its own efforts to assist retirees in navigating the Medicare maze that is familiar to fellow retirees across the nation.

The necessary assistance for navigating the SRMC changes is being handled much more by the SRS Retirees Association than by the company. Since 2014, the Association has maintained a Resource Center staffed with volunteers who receive Medicare counseling accreditation from the Lower Savannah Council of Governments. While SRMC officials describe the affected parties as a “small sector,” the Resource Center has reportedly “been overwhelmed with calls and emails.”

While it is easy to pin blame on SRMC for its questionable decision to pursue a different path than its SRS contractor colleagues SRNS and BSRA, the U.S. Department of Energy (DOE) has the ultimate responsibility of overseeing these changes. Every year DOE contract administrators review contractor performance to determine the level of bonuses, known as Award Fee Determinations, earned by contractors.

Will DOE find SRMC’s approach to maintaining strong relationships with retirees, which in turn affects the workforce recruitment and retention programs, acceptable, or even desirable due to cost reductions; or will it find a way knock a point or two off the awards fee rating? Does taking care of retirees within the community play any role in the “Community Commitment” contract provision?

The 2022 Annual Health Insurance Enrollment Period notice shows a uniform approach by all three primary SRS operational contractors. After the departure of Right Opt as the insurance broker, SRR successor Savannah River Mission Completion (SRMC) pursued a different path than SRNS and BSRA, resulting in substantial changes to health insurance plans for upwards of 700 retirees.


Footnote

(1) The First Round of Retiree Benefit Changes

In 2012 DOE allowed its SRS contractors to terminate the generous practice of continuing employee health care benefits for SRS employees following their retirement.

This highly controversial move was covered by the exclusive $2,500 per year trade publication Weapons Complex Monitor. According to its January 13, 2012 report, in 2011 SRS contractors announced plans that “would drop retirees from the site’s standard health plan and instead provide them an unspecified stipend to partially pay for individual health coverage.”

Retirees and their Association fought this effort long and hard, consistently contending that “at the time of retirement they were promised more complete health coverage.” The issue grew to the point of involving U.S. Senator Lindsey Graham and Congressman Joe Wilson.

SRS contractors accustomed to long-time employee loyalty experienced the unpleasant task of explaining the changes to a nearly packed audience of unhappy retirees at USCA’s Etherridge Center. Shortly after, one former worker later captured the mood in a brief Aiken Standard letter to the editor:

They offered an early retirement package to me, and many others, to reduce the workforce. The carrot was medical coverage. Now they are turning their backs on us. 

And, in an oped by the Aiken Standard, which has chosen to not cover this latest development, the editorial board wrote:

The unfortunate thing about the situation was that it took more than a year for these retirees to get these answers, leaving them only a few months to attempt to plan for what could have a significant impact on their future incomes.”

Ultimately, the changes went forth, but with the annual stipend being the latest promise for the future.


Gathering on the Rooftop Terrace

The downtown “Mixed Use” building feasibility report: Weak cost estimates, data free analysis, and continued use of public relations criteria in site selection. Is this a VIP Entertainment Center or a Workplace Development Center? And where is the lab?

by Don Moniak
September 14, 2023

The long overdue downtown Savannah River National Laboratory (SRNL) office building project (1) draft feasibility study was released this week, just two days prior to the project’s first “public input session” in seven months. Nine months in the making, the underwhelming report has the hallmarks of a few people casually sitting around an office one afternoon generating a list of evaluation criteria and project pros and cons.

The report was released just two months after great uncertainty over SRNL’s role in, and commitment to, the project emerged. The draft feasibility study does little to quell that uncertainty, at different points referring to a “proposed office tenant,” “prospective tenant,” or “future tenant.”

The acronym SRNL is actually absent from the report, replaced by the vague category of “Mixed-Use” that was first adopted four months ago.

Progress Report On: Aiken Corporation Mixed Use Feasibility Study,” begins with this historically inaccurate claim:

At the time (late 2022), the Aiken Corporation was attempting to attract a $20 million investment in the form of a grant from the PU Settlement Fund from the South Carolina General Assembly.” (2)

As reported in Off-Site Infrastructure and Three Missing Pages, the historical reality is very different:

  • The now defunct Aiken Municipal Development Commission (AMDC) courted SRNL officials for the first half of 2022, in anticipation of a $20 million allocation for which the AMDC itself had originally lobbied. 
  • The $20 million for “SRS/National Laboratory Offsite Infrastructure” was allocated in mid-2022 by the General Assembly. 
  • The AMDC and  SRNL had agreed to a proposed, never-disclosed location by June 2022.
  • Aiken Corporation’s late 2022 involvement consisted of being contacted by the City of Aiken  “with the goal of having the Developer (Aiken Corporation)  engage various experts to perform certain services.” 
  • The City of Aiken requested the $20 million in project funds in January 2023. 
  • The City of Aiken did not approve its $250,000, no-bid “pre-development” contract with the Aiken Corporation until March 13, 2023. At this time, the Aiken Corporation remains a “pre-development” contractor.

    With that kind of pat-oneself-on-the-back opening, profound insights should be unexpected, and the report does not disappoint.

    A Convenient Cost Estimate

    Among the underwhelming findings is a “rough order of magnitude cost estimate” of precisely $20 million and zero cents ($20,000,000.00). The breakdown of costs also remains nearly identical to the City’s January 2023 estimate, with two notable exceptions:
  • The construction cost estimate for a 36,000 square foot building are $1.2 million higher than for a 45,000 square foot building. 
  • Contingency cost estimates are reduced from nearly 15% ($2.7 million) to only five percent ($1.0 million).

    Deficiencies and Inconsistencies

    The study purports to have evaluated five locations for locating the facility. The cost options are identical for each option.

    At least one notable deficiency exists for each alternative, and, looked at across the board, inconsistency reigns: 

  • The former Public Safety building on North Laurens Street, which is a two-minute walk from the business district, and directly across from the very busy downtown Post Office, is considered to have “limited pedestrian activity.” 
  • The Chesterfield Street option adjacent to the new Municipal Building is said to have “no opportunity for green space,” despite being across the street from one of Aiken’s revered tree-lined Parkways.
  • The Newberry Street option, located on vacant lots purchased by Aiken Corporation in July, 2022,  has as a negative “adjacent to existing residential uses,” although the same can be said of every site but the Pascalis properties. 
  • At the Pascalis properties site on Richland Avenue, a “Courtyard/Plaza (that) adds green space,” is identified as a benefit, although the area in question is the small dead-end alley between the McGhee Building and Warneke Cleaners.
  • The Old Hospital site at 828 Richland Avenue, which has the most existing green space, received no credit for that green space. Ironically, the project’s main authors, McMillan Pazden and Smith (MPS), was the design firm hired by WTC Investments in 2019 to help with a failed effort to redevelop that property. MPS, which had no qualms about demolishing and clearcutting the entirety of the 828 Richland Avenue property four years ago, has since taken a liking to the mature trees there and does not identify the absence of demolition requirements as a site advantage. (3)

    Corporate Entertainment Criteria or Workforce Development Criteria?

    Key criteria identical to those leading to the original Pascalis properties siting decision, none of which are cost-related, appear to continue to disproportionately drive the current evaluation. These criteria are best summarized as “visibility” and “accessibility to downtown.”

    During the January 23, 2023, State of the City Address where the project announcement was made, SRNL Director Dr. Victor Majidi emphasized that visibility was “most important:”

    Most importantly this building is the community face of the laboratory…This  building…brings the Savannah River National Laboratory into the heart of the Aiken community.”

    During a subsequent February 6th public forum (the only one to date), MPS moderator K.J. Jacobs described the site selection process:

    The national lab folks were very interested in a site with a high degree of visibility…they wanted to be at sort of the Main and Main Street location in Aiken so that they could have maximum visibility. They want to be a part of the community. They want their folks to be able to leverage walking downtown easily and being able to go eat in a restaurant.

    Walkability was important and and their interest in having access to amenities in downtown…the other part of that is the Amentum theater and ideally having close proximity to that. Just like Newberry Hall, there’s no point going and creating a bunch of catering facilities if you have the opportunity to leverage existing relationships next door.

    So those (criteria) were the framework around the decision to focus on this site. As you all know the City of Aiken controls this site so putting that criteria together with this site has led us to this conversation.” 

    These non-cost factors of walkability, visibility, and accessibility remain driving factors for site selection, and the two obvious throw-in alternatives, the Old Hospital and former Public Safety Building sites, both received negative reviews for these non-cost criteria.

    Visibility is obviously a public relations factor. DOE contracts contain a standard provision titled “Community Commitment,” which can be summed up as “maintain a positive image” and “win hearts and minds.” The looming presence of a seemingly benign science laboratory office headquarters in downtown Aiken will certainly help provide a positive filter to offset the glare of expanded nuclear weapons materials production at the Savannah River Site, as well as the fact that the heavily contaminated 310 square-mile area will remain off-limits to public use for the foreseeable future.

    The inherent cynicism of the other two non-cost criteria—walkability and accessiblity—is symbolized by one feature in the “Conceptual Building Floor Plans: the third floor’s “Covered Terrace.”

    This rooftop terrace concept was first identified in the scope of work in the Aiken Corporation’s March 13, 2023 contract:

    There is a desire for a rooftop gathering and event space.”

    A common refrain justifying the “nearby amenities and dining” argument is that the lab is just wanting to treat its workers well.

    This workplace environment chorus is a ruse. The Department of Energy no longer even provides a cafeteria for well over one-thousand lab employees at its worn down, seventy-year old lab complex. Many employees remain in mobile offices, as if they are working on a temporary construction site.

    The idea that DOE/SRNL and its operating contractor Battelle Savannah River Alliance (BSRA) might be locating fewer than ten percent of the lab’s workforce amidst the amenities of downtown Aiken as a means of workplace betterment is comical on its face.

    The desire for nearby amenities and a rooftop gathering place clearly have a more utilitarian purpose: wowing visiting University system dignitaries, colleagues from other National Laboratories, technology transfer partners, and any other number of professional and political luminaries. Meetings following a long day of nuclear nonproliferation training or nuclear weapon-parts simulations can end with a trip to unwind on the rooftop terrace or a walk to the nearest fine dining establishment. The opportunities for photo-ops that will further enhance the image of the lab and thus SRS will be plentiful.

    By all indications to date, the SRNL offsite office complex building is being designed more for a combination of public relations, image enhancement, and an entertainment center for DOE’s corporate contractors, and much less for the more tedious task of workforce development. Thus, $20 million of plutonium settlement funds resulting from the Department of Energy’s bureaucratic incompetence and misleading promises is likely being put to the cabinet agency’s use to enhance its own image and those of its nuclear weapons production and cleanup contractors.

    That is, if DOE/SNRL is even interested.

Conceptual Plan for Third Floor of the “Mixed Use” Building. “Covered Terrace” is to the right.
“Mixed Use Facility” Site Alternatives. Walking Distance is from Laurens Street and Richland Avenue. This approach discounts the presence of shops and restaurants on North Laurens and West Richland, as well as proximity of Old County Hospital Site to Rose Hill Estate. This map contains the only site selection data set in the report, an indication that “walkability” is more important than cost.

Footnotes

(1). During the January 23, 2023 State of the City address, Aiken City Councilman and Mayor Pro Tem Ed Woltz announced a proposal to construct a $20 million “Workforce Development Center” on behalf of the Department of Energy’s (DOE) Savannah River National Laboratory (SRNL) in downtown Aiken.

Project funding is from the $20 million allocation from the State of South Carolina’s 2020 settlement with our federal government, commonly referred to as plutonium settlement.

The proposed location was on properties obtained by the now defunct Aiken Municipal Development Commission (AMDC) for the purpose of the $100 million plus downtown demolition and redevelopment endeavor known as Project Pascalis. There was no discussion of alternative sites.

Project History from November 2022 to May 2023

The full timeline of known events since the cancellation of Project Pascalis on September 29, 2022 is as follows: 

December 9, 2022. AMDC Chairman Keith Wood and Chris Verenes resigned in protest due to the failure of City Council to meet with them regarding the causes of the Project Pascalis failure.  

December 12, 2022. Aiken City Council met in closed-door Executive Session to discuss: 

  • “Potential purchase of real property located in downtown Aiken.”
  • “A proposed contractual arrangement to lease property in downtown Aiken.  

In regard to the latter topic, City Council was discussing, and probably negotiating for, rental of property owned by the AMDC and not the city. 

Mayor Rick Osbon recused himself because the “discussion might involve one of his direct competitors.” (Warneke Cleaners is the competitor, and the property it leases is part of the SNRL project). 

Attendees included Chamber of Commerce President and AMDC commissioner David Jameson, attorneys Daniel Plyler and Gary Smith, Tim O’Briant, Buzz Rich, SRNL Director Dr. Vahid Majidi, and SRNL Assistant Director Sharon Marra. 

December 14, 2022David Jameson resigned  from the AMDC, citing South Carolina’s simple Community Development Law as the root cause of the Pascalis project failure. 

January 9, 2023: City Council held another closed-door Executive Session involving the same property purchase and lease arrangements at the December 12, 2022, Executive Session. Absent from list of attendees is SRNL’s leadership and Buzz Rich. 

The same day, at the regular City Council meeting, Council “continued” a motion to establish itself as the governing body of the AMDC. 

January 17, 2023. Despite the expressed wishes of all but two citizens to dissolve the AMDC, City Council unanimously voted to appoint itself as governing body of the AMDC; in order to transfer AMDC properties and assets to the City of Aiken. 

January 25, 2023: The SRNL lab project is announced at the “State of the City” jamboree. With Mayor Osbon continuing to recuse himself, Mayor Pro-Tem Ed Woltz described the project in identical terms as the December 9th Aiken Corporation/MPS agreement, and stated: “This is not a done deal.” (Cou

SRNL Director Majidi also addressed the crowd and assured them that no chemical or radiological operations would take place; but also described the facility as a “nonproliferation training center.” According to the SRNL website, this aspect of its mission involves U.S. intelligence agencies. (His transcribed comments are in footnote 2 here.)

January 28, 2023:  The City of Aiken announced it would hold a public forum. No mention of the Aiken Corporation was in the announcement. 

February 6, 2023:  The “City of Aiken Public Input Session” was held at the African American center. Aiken Corporation CEO Buzz Rich opened the session and described it as “focus meeting.”  MPS “Principal” K.J. Jacobs moderated the meeting, which he later described as a “listening session.” No mention was made of the existing agreement between Aiken Corporation and MPS. 

Present in the audience, but not taking part in the discussion or answering questions, was the SRNL leadership. SRNL has yet to engage with concerned citizens in a public forum, and has been absent from discussions involving the parking garage proposed as a key part of the lab project. 

The initial cost estimate of the parking garage, euphemistically referred to by city officials as a “structured parking solution,” is estimated to be $7 million. Two identified sources of funding are hospitality tax funds and plutonium settlement funds from the city’s $25 million share of the plutonium settlement allocated for “Downtown and Northside Redevelopment.”

The garage was not a part of the February 6th discussion. 

In addition to the statements mentioned in the body of this article, Mr. Jacobs also provided an email address for comments and promised to establish a website to chronicle “appropriate” comments. The latter is also a requirement in the March 13th contract. The email addressed failed to work for five days, and the website has yet to appear.

February 8, 2023: The Aiken Corporation approved two items: 

a. As reported in The Agenda Setting Aiken Corporation, signed an agreement with the City of Aiken to share in the cost of hiring McMillan, Pazdan & Smith Architecture.” 

b. The hiring of attorney Tracy Green at a fee of $400 per hour to “look at the current by-laws, Freedom of Information Act issues, and other legal matters.” Other legal matters includes negotiating leases with “third parties” such as SNRL. (The by-laws were updated and approved in May 2023).

City Council members Lessie Price and Gail Diggs were listed as present in the attendee list, acting as “ex-officio” voting members of the Aiken Corporation. 

March 7, 2023: The Design Review Board (DRB) held a public “work session” to discuss the design of a ~$7 million parking garage, termed a “structured parking solution,” proposed to accommodate the influx of lab employees. During the pre-decisional meeting citizen comments were prohibited—reducing them to spectators while developers and city officials were participants.

March 8, 2023: The Aiken Corporation approved a motion to “to accept the proposed Professional Services Agreement with the City of Aiken.” City Councilwoman Lessie Price was listed as an attendee. 

March 13, 2023. Aiken City Council convened as the governing body of the AMDC. After the issue arose of potential conflicts of interest due to the status of the two Council members on the Aiken Corporation Executive Committee, Council as AMDC tabled the motion to transfer AMDC properties and assets to the City of Aiken. A decision was made instead for a Council public hearing to dissolve the AMDC as a means to transfer the properties and assets—-since dissolution would automatically trigger the transfer. 

Later, during its regular meeting, Aiken City Council approved the $250,000, no-bid professional services agreement with the Aiken Corporation; which was deemed “The Developer” in the contract. As already stated, the December 9, 2022 Aiken Corporation agreement with MPS was incorporated into the contract. 

Aiken City Council approved a contract for pre-development work on property the City of Aiken did not own, and which only controlled via its dual-role existence on the AMDC. 

March 27, 2023. Aiken City Council approved, on First Reading, the dissolution of the AMDC. Both Councilman Ed Woltz and Mayor Rick Osbon recused themselves from the discussion—due to Woltz’s ownership of land adjacent to AMDC properties, and Osbon’s “friendly competitor” Warneke Cleaners occupying part of the lab project property. 

After the issue of a potential conflict of interest involving that status of the two Council members on the Board of the Aiken Corporation, the two committed to resigning from the Board. Subsequently the motion passed unanimously on the First Reading. 

March 28, 2023: Councilmembers Lessie Price and Gail Diggs resigned from the Board of the Aiken Corporation. 

April 10, 2023. Aiken City Council deferred the Second Reading of the vote to dissolve the AMDC, with City Attorney Gary Smith stating he would request an informal opinion on the ethics issues regarding the 

April 13, 2023. Smith submitted his request, and added a request pertaining to Ed Woltz and Rick Osbon. 

April 27, 2023. The staff of the Ethics Commission issued its informal opinion, stating that no member of Council had to recuse themselves from the vote to dissolve the AMDC. 

In regard to the Council members of Aiken Corporation’s board, the informal opinion cited formal opinions of the Commission from 2000 and 2001 that exempted elected officials from conflict of interest laws if they serve as members of Boards of organizations which were created by, and exist at the discretion of, the elected officials’ governing body. In the absence of this exemption, the March 28th resignations would apply to any future votes. 

In regard to Mayor Osbon and Councilman Woltz, the staff’s informal opinion cited the lack of financial gain from dissolving the AMDC because vote to dissolve was not a direct vote to transfer AMDC properties and assets. 

Meanwhile, little discussion of the lab project has occurred. It might be held up by the failure of Council to transfer the properties to city control, and/or the identified closed-door meetings with “key stakeholders” is ongoing.  

Meanwhile, the date for the draft “feasibility study” schedule is now two weeks overdue. No website is up and running to share citizen comments. 


(2) The correct binomial for plutonium is Pu, not PU.

(3) McMillan, Pazden, and Smith’s 2019 conceptual plan for 828 Richland Avenue, W, the Old County Hospital. An apartment complex requiring removal of forest canopy was planned where the “Mixed-Use” lab facility is now proposed by Turner Development. (top building, from page 84 of the October 28, 2019 Aiken City Council meeting agenda information packet.)

MPS cited “Partially wooded site will require removal of mature trees” as a disadvantage for this Mixed-Use facility.