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Background. This report, which is one in a series requested by the Deputy Secretary of Defense, evaluates DoD management of the fissile material storage project and the chemical weapons destruction project under the Cooperative Threat Reduction (CTR) program. This report also discusses Inspector General of the Department of Defense (IG DoD) Report No. D-2002-154, "Cooperative Threat Reduction Program Liquid Propellant Disposition Project," September 30, 2002, and IG DoD Report No. D-2003-131, "Cooperative Threat Reduction Program: Solid Rocket Motor Disposition Facility Project," September 11, 2003. The objectives of the CTR program are to destroy chemical, nuclear, and other weapons; to transport, store, disable, and safeguard weapons until their destruction; and to establish verifiable safeguards against proliferation of weapons of mass destruction.
For the fissile material storage project, DoD agreed to assist Russia with the storage of fissile material from dismantled nuclear weapons to ensure that the destruction of nuclear weapons was not interrupted. The fissile material storage facility can store 25,344 containers of fissile material. For the chemical weapons destruction project, DoD agreed to assist Russia in creating a facility to destroy Russian nerve agents, along with the munitions in which they are contained. After the nerve agents are neutralized, Russia plans to encase the neutralized chemicals in a type of asphalt called bitumen for long-term storage.
Results. In IG DoD Report No. D-2002-154, we reported that Russia will not use the liquid propellant disposition facility because Russia stated that it had used the liquid propellant for commercial space launches. In IG DoD Report No. D-2003-131, we reported that Russia stated that it had stopped the solid rocket motor disposition facility project because Russia could not obtain the land allocation. The United States spent $95.5 million to assist Russia in converting liquid propellant into commercial products and $99.7 million to assist Russia in designing and constructing the solid rocket motor disposition facility.
Similar to the situation with the liquid propellant disposition facility project, there are risks that Russia may not fully utilize the fissile material storage facility. Also, similar to the situation with the solid rocket motor disposition facility project, there are risks that Russia will rescind land allocation for the chemical weapons destruction facility. There are also risks that delays in obtaining design approvals for the chemical weapons destruction facility will cause the construction schedule to slip and increase costs, that Russia will not use the designed bituminization building, and that construction and operation of the facility will be suspended or terminated because of environmental laws. As of July 2003, DoD has spent $372.8 million for containers and to design and construct the fissile material storage facility and $203.9 million for the chemical weapons destruction facility, but Russia may not fully utilize those items to store fissile material and destroy chemical weapons. DoD could have better managed the risks associated with those projects had it negotiated implementing agreements that better defined Russia's requirements, thus making Russia more responsible for the storage and elimination of Russian weapons of mass destruction. (See the Finding section of the report for the detailed recommendations.)
We reviewed the management control program of the Defense Threat Reduction Agency and identified material management control weaknesses within the CTR Program as defined by DoD Instruction 5010.40. Management controls over the CTR Program were not adequate to ensure that facilities constructed to aid Russia in the storage and destruction of weapons of mass destruction were used for their intended purpose.
Management Comments and Audit Response. Comments from the Deputy Under Secretary of Defense (Technology Security Policy and Counterproliferation) were partially responsive. The Deputy Under Secretary needs to readdress the recommendation to obtain an agreement with the Ministry of Defense outlining the types and quantities of fissile material to be provided for storage in the Fissile Material Storage Facility. The Deputy Under Secretary needs to address the recommendations to obtain an agreement with the Russian Munitions Agency to resolve concerns over the transportation of chemical weapons to the Chemical Weapons Destruction Facility and obtain an agreement with the Russian Munitions Agency committing Russia to the bituminization process. The Deputy Under Secretary also needs to comment on the revised recommendation to obtain all design package approvals before obligating more than 40 percent of anticipated project costs. The revised recommendation was based on Public Law 108-136, "National Defense Authorization Act for FY 2004." In addition, the Deputy Under Secretary needs to provide a copy of the signed transparency agreement with the Ministry of Atomic Energy. We request that the Deputy Under Secretary provide comments to the final report by January 20, 2004. Comments from the Director, Defense Threat Reduction Agency were responsive. See the Finding section of the report for a discussion of management comments and the Management Comments section of the report for the complete comments.
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