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Improving the Environment: An Evaluation of the DOE's Environmental Management Program (1995)

Chapter: Part 3: Priority-setting, Timing, and Staging

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Suggested Citation:"Part 3: Priority-setting, Timing, and Staging." National Research Council. 1995. Improving the Environment: An Evaluation of the DOE's Environmental Management Program. Washington, DC: The National Academies Press. doi: 10.17226/5173.
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Part III

Priority-Setting, Timing, and Staging

Suggested Citation:"Part 3: Priority-setting, Timing, and Staging." National Research Council. 1995. Improving the Environment: An Evaluation of the DOE's Environmental Management Program. Washington, DC: The National Academies Press. doi: 10.17226/5173.
×

SUBCOMMITTEE ON PRIORITY-SETTING, TIMING, AND STAGING

EDWIN H. CLARK II (Chair), President, Clean Sites, Inc.

HUGH J. CAMPBELL, Jr., Environmental Manager, DuPont

MARY R. ENGLISH, Associate Director, Energy, Environment, and Resources Center, University of Tennessee

DONALD R. GIBSON, Department Manager, Systems Analysis, TRW Environmental Safety Systems

ROBERT E. HAZEN, Chief, Bureau of Risk Assessment, New Jersey Department of Environmental Protection

THOMAS LESCHINE, Associate Professor, School of Marine Affairs, University of Washington

ROBERT H. NEILL, Director, Environmental Evaluation Group, New Mexico

LYNNE M. PRESLO, Senior Vice President, Technical Programs, Earth Tech

ANNE E. SMITH, Principal and Vice President, Decision Focus, Inc.

MERVYN L. TANO, General Counsel, Council of Energy Resource Tribes

Staff

Robert Andrews, Senior Program Officer

Patricia Jones, Project Assistant

Suggested Citation:"Part 3: Priority-setting, Timing, and Staging." National Research Council. 1995. Improving the Environment: An Evaluation of the DOE's Environmental Management Program. Washington, DC: The National Academies Press. doi: 10.17226/5173.
×

Introduction

The Subcommittee on Priority-Setting, Timing, and Staging was established to review two areas of concern for Assistant Secretary Grumbly. The first, linked directly to priority-setting, dealt with

the process of setting priorities for environmental management activities and how the process incorporates societal values, costs, current regulations, and risks to the environment, public health, and worker safety.

The second, focusing on the issues of timing and staging, dealt with

how the environmental management program can schedule technology development and remediation and restoration efforts to maximize cost savings and minimize risks to the environment, public, and workers.

The two issues are closely related. When to undertake a particular activity and how best to organize its components—timing and staging —depend on the priority that the Department of Energy (DOE) attaches to completing the activity. Similarly, which activities should be undertaken first—priority— depends on the options, requirements, and advantages and disadvantages related to the timing and staging of the possible activities.

The subcommittee has concluded that priority-setting for DOE's Environmental Management Program has been problematic more for management reasons than for technical reasons. Important features that are essential for a sound priority-setting process at DOE, but that the subcommittee perceives as still lacking are the following:

  • Clearly stated goals that are the fundamental end point of the priority-setting decisions.

Suggested Citation:"Part 3: Priority-setting, Timing, and Staging." National Research Council. 1995. Improving the Environment: An Evaluation of the DOE's Environmental Management Program. Washington, DC: The National Academies Press. doi: 10.17226/5173.
×
  • Stakeholder involvement in the priority-setting process that is both timely and integrated between local and national levels.

  • Priority-setting that is comprehensive in scope (including intersite rankings among different geographic regions) and that goes beyond risk-ranking.

A range of organizational and cultural changes are also necessary to achieve as part of filling these gaps. Tools exist that can support most of the priority-setting needs in a technically sound manner once the management issues have been addressed, although they will need refining and adjustment to suit the specific needs. The rest of this report explains the management issues in more detail and provides some general guidance on the usefulness of different supporting tools.

Suggested Citation:"Part 3: Priority-setting, Timing, and Staging." National Research Council. 1995. Improving the Environment: An Evaluation of the DOE's Environmental Management Program. Washington, DC: The National Academies Press. doi: 10.17226/5173.
×

Current Realities and Historical Context

The subcommittee recognizes the extreme difficulty of establishing priorities in an agency as complex as DOE. DOE has a number of missions. It has a national-defense mission, an energy-security mission, an environmental-quality mission, and a basic-research mission in support of its other missions. Moreover, DOE seeks to contribute to the nation 's economic productivity by collaborating with industry wherever its established missions have provided an expertise that some industrial partner wishes to share. The programs of DOE that are undertaken in the pursuit of its missions inevitably have some goals that are inconsistent and some that are actually in conflict. In addition, DOE's priority-setting efforts will be affected by such factors as shrinking budgets; institutional relationships between DOE Headquarters, field offices, and contractors; and local and national political considerations. The subcommittee has sought to develop recommendations that will be useful and durable in the face of those disparate and changing circumstances.

DOE must and does decide what actions to take and how to spend its resources. In making its decisions and undertaking its actions, DOE is perforce establishing priorities. The subcommittee has gained, in the short time available, as much understanding as it could of the historical context and current practices for setting priorities in the DOE Office of Environmental Management (EM).

EM has its roots in a 1989 reorganization of DOE. At that time, it was apparent that the activities associated with waste management and environmental restoration were increasing in budget and complexity and that if the demands of federal and state regulators were to be met, a centralized planning

Suggested Citation:"Part 3: Priority-setting, Timing, and Staging." National Research Council. 1995. Improving the Environment: An Evaluation of the DOE's Environmental Management Program. Washington, DC: The National Academies Press. doi: 10.17226/5173.
×

process within DOE that could take into account the different situations across the entire DOE complex was needed. Before then, activities had been dictated largely by the desires of site managers, and their needs were not the principal concerns of the programmatic assistant secretaries who had responsibilities for the sites. With the creation of the Office for Environmental Restoration and Waste Management (later the Office of Environmental Management) came an attempt at more centralized planning; meanwhile DOE was continuing in its efforts to accommodate federal and state environment regulators who had only recently been given some jurisdiction over the sites.

While the 1989 reorganization was taking place, dramatic reductions occurred in the defense-related activities of DOE with the conclusion of several agreements between the former Soviet Union and the United States on reducing the number of nuclear weapons. DOE, states, and the Environmental Protection Agency (EPA) were establishing consent agreements establishing the outline of site-specific remediation efforts. It is not inconsequential that DOE has engaged in a massive environmental-remediation effort at the same time that the defense weapons complex has been declining. At some DOE sites, states and localities may see it as a high-priority matter of DOE's EM program to “fill the gap” with respect to employment and economic activity, whereas DOE and some taxpayers may see the expeditious, economic, and safe return of sites to the local communities as having high priority.

Another turn of events important for understanding the present context of the EM program was DOE's loss of some of its self-regulatory status in the environmental arena. Before 1980, DOE generally considered itself to be largely responsible for its own environmental performance. During the 1980's, however, state and federal environmental regulators gained partial jurisdiction over DOE sites—often in an atmosphere of distrust and hostility.

Today, many of the priorities in the EM program are set by the 100-odd compliance agreements that DOE has entered into with EPA and the states. These agreements have often become the primary “legal” drivers for EM budgetary decisions in DOE. Requests for funds from field sites and the later requests by DOE to the Congress for funding are driven largely by compliance with federal and state statutes and agreements.

EM developed and tested a highly sophisticated priority-setting tool for setting environmental restoration priorities called the Environmental Restoration Priority System (ERPS) from 1988 to 1991. However, the DOE discontinued the development and use of this system because of strong opposition by the states and other stakeholders who felt that the system had been developed without their input (Jenni et. al., 1995).

More recently EM established a set of 6 goals to guide its budget formulation process:

  • Urgent risks and threats.

Suggested Citation:"Part 3: Priority-setting, Timing, and Staging." National Research Council. 1995. Improving the Environment: An Evaluation of the DOE's Environmental Management Program. Washington, DC: The National Academies Press. doi: 10.17226/5173.
×
  • Workplace safety.

  • Managerial and financial control.

  • Outcome orientation.

  • Focused technology development.

  • Strong partnerships with stakeholders.

The subcommittee defined its task as providing recommendations to DOE for improving its priority-setting system so that it allocates its available resources at its facilities to manage wastes, restore degraded environments, and otherwise protect the public's health and welfare in a cost-efficient and credible manner.

Suggested Citation:"Part 3: Priority-setting, Timing, and Staging." National Research Council. 1995. Improving the Environment: An Evaluation of the DOE's Environmental Management Program. Washington, DC: The National Academies Press. doi: 10.17226/5173.
×

An Inclusive System

Priority-setting is often thought of in a limited sense, for instance, as applied to deciding which of many items on an agenda should be undertaken first or how much of an available budget should be spent. In the context of DOE, it can be used for screening activities, intra-site ranking of similar projects, intra-site ranking of projects in different areas, site-to-site ranking, etc.

To be successful, a priority-setting system1 should be comprehensive in scope, addressing all forms of EM decisions and activities and addressing all DOE sites as a group. It must be technically sound, but it also needs to be rooted in the organization 's basic visions about its purpose and goals. At the same time it is important to note that DOE does not require a sophisticated system to identify the highest-risk cases first; we recommend that DOE continue to act immediately to identify high-risk cases.

The subcommittee believes that priority-setting, timing, and staging are comprehensive planning activities that must take place within an organized and effective management context. Organization and management set the context for achieving progress in priority-setting, timing, and staging decisions. Progress in such decisions cannot be achieved simply through application of new or improved tools and analytical techniques. DOE requires a fundamental and pervasive change throughout the organization.

1  

The subcommittee uses the term “priority-setting system” as opposed to “priority-setting process” to emphasize that we believe that priority-setting must extend in many ways throughout many aspects of the DOE organization, and cannot be limited to a specific process that functions independently of these other parts of the system. The term “system” should not be taken to mean a specific tool or methodology.

Suggested Citation:"Part 3: Priority-setting, Timing, and Staging." National Research Council. 1995. Improving the Environment: An Evaluation of the DOE's Environmental Management Program. Washington, DC: The National Academies Press. doi: 10.17226/5173.
×

This is not a trivial undertaking. Indeed, EM has a particularly daunting assemblage of sometimes inconsistent and even conflicting responsibilities and activities that it needs to harmonize if it is to establish an effective and efficient priority-setting system. EM must deal with:

  • A need to balance fairness against efficiency and optimization.

  • Substantial differences in what is perceived to be acceptable risk for workers, the general public, and the environment.

  • Missions that range from the correction of environmental releases and the prevention of releases to safeguarding nuclear materials vital to the nations defense.

  • A large variety and number of sites and contractors.

  • Multiple regulatory requirements in DOE, EPA, Occupational Safety and Health Administration, state, and multiple-party agreements.

  • Different beliefs of affected parties regarding the goal of ultimate land use.

All government organizations have to deal with such conflicts and justify their actions and requests for funds to fulfill their responsibilities. EM, however, faces a particularly great challenge because of its poor record of environmental restoration, the extremely high costs of carrying out its responsibilities (cost estimates for the cleanup alone exceed $230 billion dollars), and the absence of yardsticks to measure progress (DOE, 1995a).

EM recognizes its problems and has made initial attempts to improve the way in which it makes and implements decisions. The recent Report to Congress, Risks and the Risk Debate: Searching for Common Ground (DOE, 1995d), is a step toward recognizing that funding and other constraints will preclude complete environmental restoration and preservation to everyone's satisfaction. The subcommittee did not review the report and cannot endorse its specific methodology or accuracy. Although the report and the recently adopted changes in the DOE budget process demonstrate an initial effort to resolve the conflict between limited resources and unlimited wishes, future attempts at evaluating risks in relation to budget priorities should give more consideration to the optimum utilization of quantitative techniques and of outside peer-review panels, verify the values assigned to different elements of the risk assessment, and provide stakeholders with assurance of the quality of the analyses. It will also be important to include stakeholders earlier if the process is to serve as a means of consensus-building for setting priorities (NRC, 1994a). DOE has taken a step in this direction by initiating the Consortium for Risk Evaluation with Stakeholder Participation (CRESP) to provide independent peer review and structured interactions with stakeholders.

Although they constitute an improvement, the actions that the agency has already taken are only a start, and EM has not yet achieved a comprehensive and inclusive priority-setting system that will provide direction and guide the decisions that the agency must make in the coming years. Only when

Suggested Citation:"Part 3: Priority-setting, Timing, and Staging." National Research Council. 1995. Improving the Environment: An Evaluation of the DOE's Environmental Management Program. Washington, DC: The National Academies Press. doi: 10.17226/5173.
×

DOE has established a more-comprehensive system will it be able to spend money wisely to manage risks to workers, the public, and the environment and to instill confidence in the public and Congress that it is doing so. Only by establishing a more-coherent system of priority-setting will DOE be able to break out of the incrementalism that characterizes its current decisions and prevents true priority-setting from taking place.

The agency needs to define what it is about in a coherent set of statements and processes that extend from the general and abstract to the specific and measurable, from defining its role to the specific steps that it will take to implement that role. It needs to define EM's mission, vision, goals, and objectives.

  • Mission. Congress usually specifies an agency's mission in the legislation that defines its programs and activities. These are the work programs that allow the organization to achieve its vision. Are they consistent with the agency's vision? Are they consistent with one another? Do they define what the agency has to do to arrive at the state it has defined in its vision? How much flexibility does the agency have to modify these statements to make them consistent with its vision?

  • Vision. The vision provides the agency, its staff, and the public an integrated look at the organization's future state. What does the agency want to accomplish? How does it want to view itself? How does it want the public to view it?

  • Goals. Goals are targets for components within the mission, i.e., what the organization is trying to achieve in the short and long term. For example, is EM trying to maximize the amount of DOE land that will be available for public use? Is it trying to contain waste and contamination and restrict land use to the greatest possible extent to minimize costs? Is it going to have a comprehensive technology-development program to reduce costs of waste management and environmental restoration activities? EM must establish specific goals (both short-term and long-term) to implement a priority-setting system. After national goals have been established, sites should be allowed to develop alternatives in consultation with stakeholders and Headquarters. Sites, with strong input from local stakeholders, should relate each activity to national goals or their corresponding site-specific objectives. However, this should be done according to standard protocols, guidance, and formats developed by EM Headquarters to permit inter-site comparisons. Open reviews should be held at the local and national levels for site priority-setting. Revised priorities that result from stakeholder or EM review should be communicated to all parties.

  • Objectives. Objectives are more-specific, short-term, and quantifiable measures of accomplishment in pursuit of the agency's goals, mission, and vision. Goals can pertain to many facilities or activities; objectives generally

Suggested Citation:"Part 3: Priority-setting, Timing, and Staging." National Research Council. 1995. Improving the Environment: An Evaluation of the DOE's Environmental Management Program. Washington, DC: The National Academies Press. doi: 10.17226/5173.
×

pertain to single facilities or activities. Objectives provide answers to such questions as these: What parts of each installation will be cleaned up with the intent of release to public use? What types of wastes will be accepted for storage or treatment at each installation? What will be the role of repositories as part of the long-range management of risks? What backup plans are made? Where will the repositories be, and what volumes of waste will they be able to accommodate? What areas of the current complex will retain long-term access restrictions? What types of risks will be managed through long-term DOE stewardship rather than complete remediation?

The success of a priority-setting system ultimately depends upon how well it is actually implemented. For example, will the vision for EM be achieved by dismantling all or selected DOE production facilities? Should EM establish regional waste repositories for ultimate disposal of certain wastes? Should EM target technology-development activities for the most-costly problems or problems with no current technical solution?

Suggested Citation:"Part 3: Priority-setting, Timing, and Staging." National Research Council. 1995. Improving the Environment: An Evaluation of the DOE's Environmental Management Program. Washington, DC: The National Academies Press. doi: 10.17226/5173.
×

Attributes of a Priority-Setting System

An effective priority-setting system has several key attributes which must be manifest both in the system's development and in its implementation. Without them, systems can be developed but will have little impact and not last long. The attributes are important for priority-setting in any organization, but they are particularly important in systems intended to influence decisions in organizations that are as complex and subject to such diverse and changing pressures as EM. Although the subcommittee observed encouraging signs in some attributes—such as stakeholder involvement, work is needed in all of the following key attributes:

  • Permanence and consistency. The subcommittee has observed a lack of consistency in EM's efforts to state its goals. Budget documents and other official pronouncements often began (rightly) with a statement of the organization 's goals, but the statement commonly differed from those in other documents issued at the same time. Such deviations and inconsistency will substantially inhibit the effectiveness of a new priority-setting system. EM is attempting to modify substantially the operations of a large, complex organization that is known more for its inertia and rigidity than for its agility. To make such a change requires consistency in statements about where the organization should be headed. The subcommittee recommends that the priority-setting system be established through a careful process that involves substantial opportunity for input from the full range of stakeholders. The subcommittee also recommends that once established, the priority-setting system be described and implemented consistently.

  • Clarity and transparency. The entire process, its development, exposition,

Suggested Citation:"Part 3: Priority-setting, Timing, and Staging." National Research Council. 1995. Improving the Environment: An Evaluation of the DOE's Environmental Management Program. Washington, DC: The National Academies Press. doi: 10.17226/5173.
×

and implementation, should be as clear and transparent to affected stakeholders as possible. Unfortunately, DOE has engendered a substantial legacy of suspicion and mistrust because of decades of operating secretly. It has made much progress already in reducing this mistrust. A clear, transparent priority-setting system will reinforce this trend and should encourage the early exchange of concerns to foster common conclusions.

  • Simplicity. The simpler the priority-setting system and its tools are, the more likely it is to be followed and trusted. Although the associated methods should be scientifically defensible, they must also be understandable to affected parties. Because many of the criteria to be rated require subjective judgment and the inventories of toxic materials are incompletely defined, it is not always possible to establish scientific certainty. Hence, the system should not be so complex as to require elaborate analyses and consume an unreasonable amount of time to prepare, especially when the data to support great detail are not available. As more data become available or as the need for greater precision in estimating risks, costs, or benefits arises, then more complex analytical approaches are justified.

  • Stakeholder involvement. The legacy of low public trust in and credibility of DOE originated in the need for secrecy in some programs and authorities assigned by Congress for self-regulation. The Secretary has taken steps to involve people affected by DOE's actions in the decision-making process. This has been successful and should be continued formally. Stakeholders do not have authority to determine funding, but they should participate in and understand the basis of funding decisions. The inclusion of state and local stakeholders in this process for FY 1997 is laudable. DOE's experience, and the experience of other organizations in similar circumstances, suggest that regulators and public stakeholders need to participate to the greatest extent feasible in priority-setting that leads to DOE budgetary decisions. (This point is similar to that made in the National Research Council's Building Consensus report (NRC, 1994a) with respect to DOE's use of risk assessment in its environmental remediation program.) However, public and stakeholder interest is strongly aligned with the interests of specific sites, and DOE's current mechanisms for public involvement appear to do a better job of promoting the budgetary stakes of particular sites than of facilitating intersite budgetary tradeoffs. Thus, while allowing for public participation, DOE must also fundamentally alter its budget-allocation process to allow for more-centralized setting of overall goals that promote the national interest. EM should apply the following principles related to stakeholder involvement:

  • For stakeholder involvement in priority-setting to be knowing and intelligent DOE must provide stakeholders with all appropriate planning and budgeting guidance.

  • Stakeholder involvement in priority-setting must occur at the installation

Suggested Citation:"Part 3: Priority-setting, Timing, and Staging." National Research Council. 1995. Improving the Environment: An Evaluation of the DOE's Environmental Management Program. Washington, DC: The National Academies Press. doi: 10.17226/5173.
×

level, the field-office level, and the Headquarters level. Therefore, DOE should tailor stakeholder involvement to specific priority-setting requirements, such as different types of stakeholder representatives and different types of stakeholder training.

  • Stakeholder involvement in different EM program components—e.g., Community Leaders Network, the Military Toxics Project (a network of community groups concerned with environmental justice), Transportation External Coordinating Committee, Environmental Management Advisory Board, and State and Tribal Government Working Group (STGWG)—should be integrated into the overall priority-setting effort.

  • Stakeholder involvement in priority-setting must be effective in helping EM to establish and resolve conflicts in field office and installation priorities and Headquarters priorities. Therefore, EM should annually evaluate stakeholder priority-setting efforts. The exercise should not be a one-time effort but should be an iterative process that encourages accountability of DOE field management and contractors.

Suggested Citation:"Part 3: Priority-setting, Timing, and Staging." National Research Council. 1995. Improving the Environment: An Evaluation of the DOE's Environmental Management Program. Washington, DC: The National Academies Press. doi: 10.17226/5173.
×

Implementation of a Priority-Setting System

The most carefully conceived and well-thought-out priority-setting system will bring little improvement if it is not implemented coherently and comprehensively for all the activities that take place in the DOE EM Program.

It is often said that the primary function of priority-setting is to help an organization decide what it will not do. In the case of EM, for instance, three groupings of activities can be made as follows:

  • Activities that provide a measurable benefit for the Program as defined on the basis of cost, risk management or risk reduction, and schedule.

  • Activities that support a measurable benefit.

  • Activities that do neither of those.

Activities in each of these groups are affected by different factors. The term used by EM is “driver.” Those activities can be classified according to their drivers, specifically:

  • Required drivers that necessitate a particular activity, such as triparty agreements, consent orders, and the Code of Federal Regulations.

  • Voluntary drivers that support the activities of DOE's overall mission of increased efficiency, such as infrastructure needs and risk-reduction or risk-management needs.

Suggested Citation:"Part 3: Priority-setting, Timing, and Staging." National Research Council. 1995. Improving the Environment: An Evaluation of the DOE's Environmental Management Program. Washington, DC: The National Academies Press. doi: 10.17226/5173.
×

Table 1 and Figure 1 depict the inter-relationships and overlaps of the three groups of EM activities and their drivers. The most basic goal of EM's priority-setting system should be to distinguish those activities that have or support measurable benefits from those that are extraneous and have no cost-or risk-reduction benefits. For example, activities that are either voluntarily or driven by regulation and provide a measurable benefit should be maintained and evaluated further to determine their exact priority, timing, and staging. Activities that neither provide nor promote or sustain measurable benefits and yet are voluntarily implemented should be eliminated. Those activities that are driven by regulation or law and that are identified as having no measurable benefits or do not support or sustain other beneficial activities, should be the subject of an effort by DOE to have those regulations modified or laws amended. Twenty-three state attorneys general have expressed a willingness to renegotiate previous commitments for environmental cleanups. DOE should aggressively explore these opportunities with the goal of reaching agreements that will result in faster and greater risk reduction, lower expenditures, and implementation plans that are more in accord with scientific and budgetary realities.

RELATIONSHIP OF OTHER MANAGEMENT SYSTEMS TO PRIORITY-SETTING

More must occur than the definition of mission, vision, goals, and objectives. DOE must also build an entire management structure in which the prioritysetting system must function. This management system should include the following:

TABLE 1 EM Activities

 

Measurable Benefit

Supports Measurable Benefit

Neither

Drivers Required by:

     

DOE Order

     

Other Regulation

X

X

seek changes

Compliance

     

Agreement

     

Law

     

Voluntary Drivers

X

X

cease activity

NOTE: X = Evaluate risk, cost, and benefit for priority-setting, timing, and staging.

Suggested Citation:"Part 3: Priority-setting, Timing, and Staging." National Research Council. 1995. Improving the Environment: An Evaluation of the DOE's Environmental Management Program. Washington, DC: The National Academies Press. doi: 10.17226/5173.
×

FIGURE 1 Activity Groupings

Suggested Citation:"Part 3: Priority-setting, Timing, and Staging." National Research Council. 1995. Improving the Environment: An Evaluation of the DOE's Environmental Management Program. Washington, DC: The National Academies Press. doi: 10.17226/5173.
×
  • Annual Budget formulation system.

  • Personnel system.

  • Contracting system.

Each of these systems will be discussed briefly. The key features which they must have to permit the effective implementation of the priority-setting system will then be described. There are three elements which should be common among all those systems: incentives, measures of performance, and feedback mechanisms to improve performance.

INCENTIVES, METRICS, AND FEEDBACK

There are a number of institutional barriers and disincentives to the effective setting of priorities that can be readily observed, and which several workshop participants noted. These barriers must be addressed. Doing so might require changes in how EM is organized and operates. Incentives will have to be created in a way that allows centralized goals to be achieved through decentralized decisions. Accountability, using accurate measures of performance, is key to aligning progress to DOE's vision. Particular examples of disincentives are as follows:

  • Lack of accountability for progress. The current system appears to have no clear measures of progress and does not hold project or site managers accountable for achieving the progress desired. It is important to note that all too often progress is seen as meeting the nearest point in a schedule rather than moving toward an objective in an organized and rational way. All too often the pressures to meet the schedules are so important that consideration cannot be given to innovative technology, innovative approaches to the process, or any other change that might be desirable in the big picture.

  • Self-perpetuation as a goal. Self-perpetuation seems to be a strong, if unexpressed, goal driving the system. Progress in cleaning up is often in conflict with this goal and often appears to lose in the conflict.

  • Costs as a “good,” risks as an “asset.” Because the funding allocated to a site is often influenced by the magnitude of the risks at the site and the estimated cost of cleaning up its contamination, there is a strong incentive to overestimate both risks and costs to increase the amount of money available and the salaries, responsibility, attention, and employment that typically result from large budgets.

As already noted by DOE, fundamental values of the organization might have to be altered, and a new culture might have to be instilled so that the changed values are spread throughout the organization. For example, increasing budgets might be valued now as a sign of success, but would be antithetical to an EM program in which success were defined as continuously improving

Suggested Citation:"Part 3: Priority-setting, Timing, and Staging." National Research Council. 1995. Improving the Environment: An Evaluation of the DOE's Environmental Management Program. Washington, DC: The National Academies Press. doi: 10.17226/5173.
×

the productivity of the program. At DOE facilities, contractors and workers have a strong incentive to make work take as long as possible; it guarantees them a job, eliminates relocation problems, and so on. DOE needs to develop incentives that will strongly counter that inherent inertia. If, for instance, it wants to reduce its workforce and complete the cleanup job early, it might provide large bonuses and relocation allowances to workers who achieve those goals. It should also be noted that such changes might extend to the participating public as well and might require an adjustment of expectations regarding the public's inclusion in the DOE decision-making process.

Effective implementation of a priority-setting system and its companion management systems requires constant evaluation of how well the systems help to accomplish the vision, mission, goals, and objectives on which it is based. Without a way to evaluate that, managers will be unable to evaluate the effectiveness of the department's operations and make corrections when they begin to diverge from their goals.

Thus, it is essential that DOE's managers and contractors be required to measure what was accomplished for the funds spent and to quantify future improvements for the funds requested. The general perception in recent years has been that public funds for environmental restoration have not been well spent, but there are no concrete measures of progress to substantiate this perception. The number of facilities decontaminated or removed from a status where monitoring is necessary and the relative cost per square foot of building space are better measures than the number of reports filed with a regulatory agency. Hence, progress must be measured in such terms as reduction in a radionuclide or chemical concentration in an aquifer or the effect of preventing a release of an aerosol or effluent from a source, not in the traditional government terms of, e.g., the frequency of inspections or the number of hours of stakeholder consultation.

A very useful metric is periodic “benchmarking” comparison with the best of the private-sector efforts. EM should calculate the cost of common environmental-management efforts undertaken by the department and compare them with those for equivalent activities in the private sector. Examples include low-level waste disposal at Chem-Nuclear in South Carolina, Envirocare in Utah, and U.S. Ecology in Washington; mixed-waste management subject to RCRA; and use of soil covers to minimize leachate problems. Such comparisons will indicate whether spending is out of line with the private sector.

Other mechanisms might include

  • A national stakeholders review panel to review results of analyses.

  • Technical evaluation of the validity of the analyses by a contractor.

  • Red-team or inspector general evaluations.

The final step required for a successful management system, including a priority-setting system, is a feedback mechanism that allows corrections in

Suggested Citation:"Part 3: Priority-setting, Timing, and Staging." National Research Council. 1995. Improving the Environment: An Evaluation of the DOE's Environmental Management Program. Washington, DC: The National Academies Press. doi: 10.17226/5173.
×

the system when it is deviating from the vision, mission, goals and objectives that the department has established. The effectiveness of this feedback system will depend substantially upon the accuracy and relevance of the metrics incorporated in it.

BUDGETING

In the budget process the role of Headquarters is to set general policy guidance and secure funding through Congress. The sites have the specific knowledge of those activities with the highest potential for harm, those that can be delayed in implementing remedial action, and those with the best potential for risk reduction. EM management at Headquarters understands the overall budget constraints placed on the Program. The product of the interaction between the sites and Headquarters—the budget request—should reflect their mutual understanding and the input of stakeholders.

EM's primary mechanism for implementing priority-setting across its entire program is its internal budgeting process. The priority-setting system and the budget system are interconnected, since projects and programs must be prioritized for funding. For FY 1997, under a directive of Assistant Secretary Grumbly, the program justifications of specific projects and programs were developed with reference to four priorities:

  • Protection of worker and public health and safety and the environment.

  • Safety, security, and stabilization of special nuclear materials.

  • Compliance with federal, state, and local regulations and statutes, related enforceable compliance and cleanup agreements, and DOE orders.

  • Compliance with other agreements to which DOE is a signatory (memorandum, Asst. Secretary Grumbly to Distribution, Feb. 13, 1995).

In addition, high priority was given to those investments which significantly drive down future costs as well as those that stabilize nuclear materials and facilities. This is a departure from earlier DOE priorities. At the outset of the EM Program the extent of the remediation task and its total costs were poorly understood. DOE was under attack on all fronts as being insufficiently aware of and responsive to its environmental problems. Reducing future costs was lower in priority than immediate regulatory compliance. These priorities have changed, and this change has contributed to the difficulties experienced by DOE employees and contractors.

As we understand it, FY 1997 development of the budget proceeded as follows:

  • National (DOE Headquarters) direction was provided to each of DOE 's site offices and apparently was focused on funding targets.

  • Sites set priorities for their work and submitted them to DOE Headquarters.

Suggested Citation:"Part 3: Priority-setting, Timing, and Staging." National Research Council. 1995. Improving the Environment: An Evaluation of the DOE's Environmental Management Program. Washington, DC: The National Academies Press. doi: 10.17226/5173.
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  • After discussions between the sites and management, the sites modified some priorities.

  • A national meeting was held (involving all DOE sites and Headquarters) at which Mr. Grumbly made decisions regarding the site and Headquarters priorities.

  • Those decisions were later shared with stakeholders, and stakeholder questions regarding both the process and the resulting priorities were answered.

  • A “lessons learned” meeting was held to discuss the process and make appropriate changes.

These last three steps are unique to the DOE EM Program and special permission was given by the Office of Management and Budget for this new process of including stakeholders in the budget formulation process. Further modifications, intended to make the process more transparent to stakeholders, are being developed by EM for FY 1998.

One problem that the subcommittee noted in the resulting 1997 budget-formulation process is inappropriate “bundling.” All priority-setting schemes rely to some extent on the assumption that the objects being compared are roughly similar. “Bundling” is the process of lumping dissimilar things into packages that are then thought of as constituting a single activity. In the case of DOE's Environmental Remediation Program, bundles of proposed remedial actions might be made up of elements that if examined individually, would be seen to pose different types of risks or to require different kinds of processing from an engineering and technical standpoint. Such bundling can erode the ability of priority-setting systems to make useful distinctions, inasmuch as the benefits of reducing the risks associated with high-risk components are offset in risk-benefit comparisons by the added costs of taking care of costly but lower-risk elements in the same package.

A variety of forces, ranging from the internal dynamics of DOE's budgeting process to DOE compliance agreements with states and federal regulators, appear to be creating this bundling problem. A prominent example of such bundling occurred in the Tank Waste Remediation System (TWRS) at Hanford. Originally, in the Hanford site's 1987 environmental-impact statement, the contents of the single- and double-shell tanks at the site were assigned to different disposition sequences. The contents of the double-shell tanks were to be retrieved, treated, and disposed of, but action on the single-shell tank contents was to be deferred (DOE, 1991). In the 1989 Tri-Party Agreement with the state of Washington and EPA, however, all tanks were bundled into the common retrieval, treatment, and disposal path that became TWRS. The planned TWRS retrieval and processing sequence gave rise to a single “high public safety” risk data sheet in the recent DOE document Risks and the Risk Debate: Searching for Common Ground (DOE, 1995b), June 1995, Appendix C, with a projected 5-year cost of nearly $400 million. Even

Suggested Citation:"Part 3: Priority-setting, Timing, and Staging." National Research Council. 1995. Improving the Environment: An Evaluation of the DOE's Environmental Management Program. Washington, DC: The National Academies Press. doi: 10.17226/5173.
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though most double-shell tanks at Hanford probably pose much lower risk to the public than do leaking single-shell tanks and tanks on Hanford's “watch” list, all are treated in the same way, and all costs are counted against high-priority risk reduction in DOE's Common Ground document.

DOE should address such bundling problems by re-examining how disparate projects and program elements are grouped for budgeting purposes with an eye to regrouping those that pose similar risks. The subcommittee believes that that could be done by a central audit (either by Headquarters or by an external independent party) that sets a target of examining perhaps 10% of the activities listed on the risk data sheets per year. An alternative might be to set a threshold on projected cost and examine all activities above the threshold. If inappropriate bundles are identified, they should be disaggregated and reranked. DOE should also establish some process for rewarding units that bundle activities properly and penalizing units that do not. The result of such an audit, however conducted, would increase the number of activities in the budgeting process in such a way that the costs associated with individual activities would, on the average, be lower —in some cases, the subcommittee believes, by a considerable amount.

The Appendix includes one approach to budgetary priority-setting that meets these requirements and satisfies the attributes listed in the previous section.

PERSONNEL

Budgeting is only one of the elements of management that drive how the DOE operates. The personnel system is another, and it might have an even greater impact on how effectively EM implements its priority-setting system.

Government personnel systems are notoriously unresponsive, and the DOE system is notorious among government systems. Such an unresponsive system can substantially inhibit the implementation of needed changes. Staff both at Headquarters and in the field should be encouraged to develop innovative approaches to solve problems, rewarded if successful, and not penalized if unsuccessful. If the personnel system is not changed to reflect or incorporate these changes, the implementation of new priorities will be much more difficult and, unless substantial pressure is continuously applied, is likely to revert gradually back to its former shape with its former priorities.

Another subcommittee has addressed the problems associated with the current personnel system in greater detail and has made some recommendations regarding how it could be made more responsive. If that is not done and if the personnel system is not made to conform to the new priority-setting system, the implementation of the priority-setting requirements is likely to be seriously retarded.

Suggested Citation:"Part 3: Priority-setting, Timing, and Staging." National Research Council. 1995. Improving the Environment: An Evaluation of the DOE's Environmental Management Program. Washington, DC: The National Academies Press. doi: 10.17226/5173.
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CONTRACTING

Much of the work undertaken under the DOE's auspices is done by contractors, not employees. It is perhaps even more important to modify the contracting system than it is to modify the personnel system. The former contracting system, established primarily on a “cost-plus” basis, rewarded input rather than output, effort rather than accomplishment. The subcommittee recognizes that EM has begun to make some important changes in its contracting system—most notably in the Rocky Flats performance-based contracts that were recently awarded. Those are important changes, and we applaud them.

Another subcommittee has dealt in more detail with the contracting system. We point out that basing contracts only on performance rather than on effort and providing rewards to contractors for achievement are crucial to the success of the changes that EM is attempting to implement in priority-setting. To do so properly, however, requires the completion of the process of defining a vision, missions, goals, and objectives described above. Only then can the department be sure that the performance measures incorporated in the contracts accurately reflect and incorporate the goals of the department.

Suggested Citation:"Part 3: Priority-setting, Timing, and Staging." National Research Council. 1995. Improving the Environment: An Evaluation of the DOE's Environmental Management Program. Washington, DC: The National Academies Press. doi: 10.17226/5173.
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Criteria for Setting Priorities

Perhaps the most important step in establishing an effective priority-setting system is identifying, defining, and selecting priority-setting criteria. It is rarely an easy task, particularly in an organization as complex and with as many divergent goals as EM. The subcommittee recommends that the DOE undertake the identification, definition, and selection carefully and deliberately, with substantial input from all the stakeholders who have to accept the final process if it is to succeed.

The first step should be to identify the full list of factors that should be taken into account in setting priorities. We suggest that the DOE consider developing and utilizing the full list of factors through a “bottom-up” approach. That is, stakeholders at the individual facilities would be asked to review an initial list of criteria developed by EM and recommend modifications or additions to it. A good starting place for developing this list would be the extensive list of evaluation criteria developed for and incorporated into the ERPS model (see Figure 2). The reviews and suggestions would be aggregated through the field offices and combined at Headquarters. A process of consolidation and redefinition would follow. The goal of this process would be to derive a manageable set of priority factors that are inclusive and clearly defined so that they are interpreted consistently by everyone involved in the EM priority-setting system, from Headquarters staff to local advisory panels and other stakeholders.

To ensure that the process is comprehensive and the criteria clear, the DOE might want to consider involving any of the following groups in the winnowing and defining:

Suggested Citation:"Part 3: Priority-setting, Timing, and Staging." National Research Council. 1995. Improving the Environment: An Evaluation of the DOE's Environmental Management Program. Washington, DC: The National Academies Press. doi: 10.17226/5173.
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FIGURE 2 ERPS Criteria

SOURCE: Lee Merkhofer, Applied Decision Analysis, Inc. Presentation at the National Academy of Sciences, June 27, 1995.

NOTE: Dashed lines below “New risks” and “New impacts” indicate subobjective structures similar to those under “Risk reduction' or impact seduction,” respectively.

Suggested Citation:"Part 3: Priority-setting, Timing, and Staging." National Research Council. 1995. Improving the Environment: An Evaluation of the DOE's Environmental Management Program. Washington, DC: The National Academies Press. doi: 10.17226/5173.
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  • A national stakeholders panel.

  • Focus groups, which can identify issues that need to be considered in the priority-setting system.

  • Site-specific stakeholder advisory groups, which can help to ensure that site-specific considerations are duly integrated into a more centralized system of priority-setting.

  • Technical review panels, which can assess the adequacy of information being generated and help to identify analytic or information gaps and shortcomings.

Although it is important to identify and define the full set of relevant criteria, the actual process of establishing priorities is likely to be driven by only one to three of them, and the department must get agreement on which, from the full list, are the most-important priority-setting factors. That should be done at the Headquarters level with the full involvement of the Assistant Secretary and Secretary.

The primary factors should demonstrate two characteristics: they can be quantified on a scale that allows activities to be ranked from most important to least important, and the factor metric, i.e., the means of estimating the extent to which each activity satisfies these factors, is determined consistently for all the activities. The value placed on the primary-factor metrics must be independent of where an activity would occur and free of any rater biases. Two criteria that are now treated as primary factors and that would probably retain this pre-eminence in any priority-setting system are risk and regulatory considerations.

USING RISK

Some measure of risk or risk reduction associated with an activity is likely to be and should be a primary factor. Examples of possible primary factors related to risk are the risks that would exist were the activity not undertaken, the reduction in risk that would result from undertaking the activity, and the risk reduction per dollar of expenditure that would be associated with undertaking the activity.

The subcommittee recommends that, to the extent possible, a single set of general methodological guidelines for risk assessment be applied to all sites and proposed activities. We recognize that establishing such a set of guidelines may be difficult. Currently, there is no consistent methodology for assessing risks at DOE sites (NRC, 1994a). Unfortunately, some of these inconsistencies are imposed on the DOE by different regulatory agencies demanding different degrees of rigor in risk assessments (NRC, 1994a). However, without some consistency in conducting risk assessments, it will be very difficult to set priorities coherently.

Suggested Citation:"Part 3: Priority-setting, Timing, and Staging." National Research Council. 1995. Improving the Environment: An Evaluation of the DOE's Environmental Management Program. Washington, DC: The National Academies Press. doi: 10.17226/5173.
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Risk assessment methodology need not depend upon sophisticated quantitative models and analytical techniques. Indeed, it is appropriate that the degree of complexity of risk assessments varies from site to site depending on the amount of data available and the purpose for which the risk assessment is being done. The view that a risk assessment process is absolutely essential for dealing effectively with the risks at DOE facilities must be tempered by the need to draw from existing data, which sometimes cannot support an exhaustive risk assessment (NRC, 1994a). In the early stages of priority-setting, a simpler, less quantitative risk assessment may be sufficient for managers to make preliminary decisions as to whether further assessment is necessary. The subcommittee believes that using these screening-level (possibly judgmental or qualitative) risk assessments is possible. As appropriate (i.e., where it is essential for the decision-maker and where sufficient data exist), more quantitative analyses should be utilized. EM should not be deterred from making priority-setting decisions where there are limitations in data and knowledge. These limitations should be noted explicitly as EM pursues its obligation to make decisions. A note of caution in the use of screening-level risk assessments: because they are often quite conservative and may overstate risk, their use is most appropriate for decisions about whether there is no any potential for significant risk or whether more analysis is needed.

Future land-use assumptions can have a profound effect on the estimation of risk. Sites that will be occupied in the future pose many more exposure opportunities than sites that will be left uninhabited. Local stakeholders must have a significant voice in decisions about future land-use. However, EM must ensure that these decisions are reasonable and that the exposure assumptions associated with the selected land-uses assumptions are consistent across sites and facilities sharing the same future land-use scenario. One might also wish to present the range in the risks by assuming perpetual isolation and unrestricted residential use, in addition to each site's selected land-use scenario.

Socioeconomic factors affecting stakeholder groups and Indian tribes may also be important to incorporate in risk assessments. A key to the successful identification and treatment of these factors is the early involvement of the interested parties in these efforts (NRC, 1994a).

Suggested Citation:"Part 3: Priority-setting, Timing, and Staging." National Research Council. 1995. Improving the Environment: An Evaluation of the DOE's Environmental Management Program. Washington, DC: The National Academies Press. doi: 10.17226/5173.
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Tools

In this section, we describe the range of types of priority-setting tools that might be considered for adoption as part of a re-engineered DOE and EM budget allocation process. This is kept brief, and is intended only to highlight the range of acceptable approaches that may be useful. An earlier NRC committee report, Ranking Hazardous Waste Sites For Remedial Action (NRC, 1994b) provides a synopsis of the qualities of good tools, and reviews of three specific existing tools that could be of relevance here. Rather than repeat such discussion, a section of that report describing the characteristics of a good priority-setting tool is reproduced as an appendix to this subcommittee's report.

Use of any tools in a priority-setting system should have the same attributes identified earlier in this report as desirable for the entire system, such as providing substantial opportunity for input from stakeholders on their values and concerns and input from technical experts on complex technical issues. Priority-setting tools generate alternatives for action and evaluate alternatives and combinations of alternatives against clearly articulated, consciously weighted decision criteria.

The main concern in selecting a tool is that the content be aligned with and supportive of an institution's goals. Choosing the right tool to support a priority-setting system involves some balancing. Tools that are attractive on process grounds might not necessarily lead to good outcomes. Formal, mathematical tools that are easy to use and understand might fail to embody sound decision logic or, in their reliance on subjective judgments, lead to results that are unstable in the face of small changes in the circumstances

Suggested Citation:"Part 3: Priority-setting, Timing, and Staging." National Research Council. 1995. Improving the Environment: An Evaluation of the DOE's Environmental Management Program. Washington, DC: The National Academies Press. doi: 10.17226/5173.
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under which they are applied. The DOE needs to consider these and other process-related characteristics as it develops or selects tools to support its priority-setting system.

In all cases, it is important to emphasize that the output of decision-aiding tools should not be the end points of the priority-setting system. Once specific options or strategies have been identified, analyzed, and assessed, decisions must still be made by accountable decision-makers regarding which options to take, and appropriate institutional and procedural enabling actions must still be taken.

The subcommittee is of the opinion that many tools that meet the DOE's needs for effective priority-setting are already available. As emphasized above, the greater barriers to more effective priority-setting are in creating an organization that allows difficult decisions to be confronted and tradeoffs to be made. Once those organizational issues have been addressed, existing priority-setting tools and approaches should provide many useful options consistent with the types of decisions that need to be made. We do not feel that trying to develop new tools would add significant value. Any system-development efforts should be targeted to improving the credibility and usefulness of tools already available in the field, either by addressing specific technical issues that have been identified in the tools or by tailoring existing systems to the goals of the DOE-EM process.

There is an important distinction to keep in mind between tools that support site-ranking and tools that support actual priority-setting. Site-ranking can place a number of risky situations in an order of risk, but such ranking does not indicate how to allocate dollars to a range of possible cleanup activities. Priority-setting, by contrast, may involve consideration of many other criteria, such as costs and incremental risk reduction. Site-ranking considering only risk can be useful for setting priorities for site assessment but not be efficient or effective for setting priorities for cleanup activities themselves. Site-ranking tools can range from strictly qualitative check-list approaches, through such scoring systems as EPA's Hazard Ranking System (HRS), to quantitative risk-assessment tools.

True priority-setting techniques, in contrast, provide enough information to assess whether to take action and what types of action to take. They are able to assist in identifying reasonable tradeoffs across sites and across activities. Thus, priority-setting tools require:

  • Activity-specific information.

  • Incremental information (e.g., how much change in risk is associated with an action).

  • Explicit recognition of the multiple goals that an institution is trying to address.

A priority-setting system can be qualitative or quantitative. One concern

Suggested Citation:"Part 3: Priority-setting, Timing, and Staging." National Research Council. 1995. Improving the Environment: An Evaluation of the DOE's Environmental Management Program. Washington, DC: The National Academies Press. doi: 10.17226/5173.
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with the usual quantitative approaches is that they are “black boxes” and that the fundamental nature of differences among alternatives is lost when all the decision criteria are collapsed into a single numeraire, such as utils or dollars. (Thus, they are weak in transparency and to some extent in the clarity with which facts are distinguished from values from the observer's perspective.) It is not necessary, however, to address the multicriteria tradeoffs required in priority-setting through strictly quantitative techniques, such as Multi-Attribute Utility Analysis (MAU). All that is required of a priority-setting tool is that it explicitly recognize the nature of tradeoffs inherent in specific choices of actions. Alternative multicriteria approaches that avoid focusing on a single score or value estimate might also be useful.

The drawback of such approaches is that information about multiple criteria can be voluminous and difficult for decision-makers to assimilate if not summarized into comparable (unimetric) units. It is possible, however, to devise visual displays in a variety of formats that assist interested parties and decision-makers in mentally processing and understanding the tradeoffs embodied in multicriteria information. Such approaches avoid the step of having the system produce specific rankings, or “recommended” actions; they leave such conclusions to be drawn by each person viewing the results, but they provide the basis for justifying one's own conclusions.

In addition to greater transparency, nonaggregating multicriteria approaches have the advantage of using neither a single person's preferences nor a highly uncertain representation of societal preferences, so they avoid potential concerns with bias. Nonaggregating approaches also allow exploration of alternative viewpoints in a format that is more conducive to consensus-building: the process helps people to visualize the perspective that other interested parties have with respect to a particular choice.2

At the site and facility levels, a number of formal priority-setting tools appear to be in use for setting budget and other priorities. One example is the Laboratory Integration and Prioritization System (LIPS), which is a multiattribute utility-based approach that was developed at Los Alamos National Laboratory and used in demonstration applications at a number of DOE sites (B. Anderson at the subcommittee 's workshop of June 26–27, 1995). The subcommittee did not review LIPS and cannot provide an overall evaluation, but we believe that LIPS should be carefully considered for its alignment with DOE's goals, once DOE's overall priority-setting system is more effectively structured. LIPS might not be readily applied to the intersite

2  

An example of such an approach is EPA's multicriteria decision-support system developed for setting priorities among strategies for adapting to global climate change, called the Adaptation Strategy Evaluator. EPA's experience in initial applications of this approach is that it is particularly useful for identifying strategic directions without the detailed analysis required of CBA, for gaining insight into why some strategies appear to meet goals better than others, and for building consensus.

Suggested Citation:"Part 3: Priority-setting, Timing, and Staging." National Research Council. 1995. Improving the Environment: An Evaluation of the DOE's Environmental Management Program. Washington, DC: The National Academies Press. doi: 10.17226/5173.
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priority-setting step, but it can readily be used for priority-setting among the many activities possible at a given location. An intersite priority-setting tool could then be applied with such site inputs as LIPS might be able to produce.

ERPS is a detailed application of the MAU approach that is tailored explicitly to deal with the many unique features of DOE's EM organization in the process of allocating budgets among sites. Although questions have been raised on particular technical points, its main limitations are that it had poor stakeholder involvement during its development and depends excessively on judgments made by the model builders rather than reflecting widespread stakeholder consensus; it is perhaps too ambitious in attempting to incorporate all values, no matter how subjective and qualitative, into a single quantitative metric; and, as a result it failed to meet the objectives of clarity, transparency, and simplicity.

This subcommittee has not reviewed ERPS in detail and so cannot make any comprehensive evaluation of it. Nevertheless, it stands as a major contribution toward an MAU-based priority-setting tool. It is unlikely that any other MAU-based tool would substantially improve on the foundations that exist in ERPS, and we recommend that the DOE allocate tool-development resources to improving the usefulness of ERPS rather than trying to develop a new MAU model to replace it. Improvement of a system that has already been heavily funded is generally more appropriate than starting from the beginning on a new system.

It must be recognized that the budget-allocation process that DOE faces is extremely complex, and MAU-type analyses, which combine all ranking criteria according to a system of weights, will probably be essential for obtaining a system wide sense of priorities. However, DOE might wish to consider using techniques that keep individual priority-setting factors separate in conjunction with those that merge priority-setting factors. In this way DOE can focus on generic priority-setting issues, such as technology development versus immediate cleanup, and also provide better communication and interaction with interested parties as DOE goes through its priority-setting system.

Suggested Citation:"Part 3: Priority-setting, Timing, and Staging." National Research Council. 1995. Improving the Environment: An Evaluation of the DOE's Environmental Management Program. Washington, DC: The National Academies Press. doi: 10.17226/5173.
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Conclusions

Establishing a robust priority-setting system for an organization as diverse and complex as EM is clearly not a simple task. The subcommittee has focused more on the attributes and characteristics of an effective priority-setting system than on the specific tools or criteria that it might employ. The organizational environment in which such a system is established and implemented may well be as important as the system itself. This organizational environment will probably be more important than the specific tools or criteria the system employs, and it will also help to determine whether the system satisfies the attributes of permanency, consistency, clarity, transparency, simplicity, and stakeholder involvement that the subcommittee recommends.

An effective priority-setting system is more than just a process of making budget decisions. It needs to incorporate specific goals and objectives so that progress can be measured. It needs to include metrics for measuring how much progress is truly being made towards accomplishing these goals and objectives. It needs to incorporate feedback mechanisms that will stimulate corrections in the decision-making process if the metrics demonstrate inadequate progress. It needs to be reflected in all of the personnel, contracting, and other administrative and decision-making processes in EM, not just in the budget process. It must be accompanied by a clear series of incentives and disincentives that reflect goals and reinforce the system. It needs to demonstrate that decisions in all these areas, both within DOE sites and across sites, are being made consistently.

Again, establishing such a system is not a simple task. It will require substantial effort and input by Headquarters and site personnel, technical

Suggested Citation:"Part 3: Priority-setting, Timing, and Staging." National Research Council. 1995. Improving the Environment: An Evaluation of the DOE's Environmental Management Program. Washington, DC: The National Academies Press. doi: 10.17226/5173.
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experts, regulators at the state and federal level, elected officials, the general public, and other stakeholders. The subcommittee believes, however, that this is an investment that should be made. The decisions EM is making will affect the allocation of tens of billions of dollars, determine how significant human health and environmental risks are addressed, affect the jobs of hundreds of thousands of workers, determine the future use of millions of acres of land, affect local and regional economies throughout the nation, and have an impact on national and international security. Clearly, these are decisions that need to be made carefully and correctly. Clearly, the investment is worth it.

The subcommittee does not want to suggest that all decision-making be put on hold until this investment is completed. Decisions must be and will be made regardless of whether an adequate priority-setting system exists. Certainly the DOE has some potentially high-risk situations that it must address. It does not require a sophisticated system to address these worst cases first, and we recommend that it do so. We also recommend that, in the interim, EM postpone those actions that do not significantly reduce risks or save money, and that are not required by current laws. Even when there appear to be current legal requirements, if the action is not addressing a significant risk, we recommend that the agency “push back” on the regulatory drivers. Ultimately, in this period of tight federal budgets, everyone will benefit if the agency can demonstrate that it is efficiently spending its resources on the most serious problems.

In short, there is plenty to do and there is a need to do it right. We believe that EM has taken some useful first steps, but it has many more to go.

Suggested Citation:"Part 3: Priority-setting, Timing, and Staging." National Research Council. 1995. Improving the Environment: An Evaluation of the DOE's Environmental Management Program. Washington, DC: The National Academies Press. doi: 10.17226/5173.
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References

DOE (U.S. Department of Energy). 1991. Tank Waste Disposal Program Redefinition. Prepared for the US DOE Office of Environmental Restoration and Waste Management. WHC-EP-0475. Rev.0. Washington, D.C.

DOE (U.S. Department of Energy). 1995a. Estimating the Cold War Mortgage: The 1995 Baseline Environmental Management Report. Volume I, March 1995. U.S. Department of Energy, Office of Environmental Management, Washington, D.C.

DOE (U.S. Department of Energy). 1995b. Risks and the Risk Debate: Searching for Common Ground “The First Step”. The U.S. Department of Energy, Office of Environmental Management Washington, D.C.

Jenni, Karen E., Miley W. Merkhofer and Carol Williams. The Rise of a Risk-Based Priority System: Lessons from DOE's Environmental Restoration Priority System. Accepted for publication by Risk Analysis. April 10, 1995.

NRC (National Research Council). 1994a. Building Consensus Through Risk Assessment and Risk Management in the Department of Energy's Environmental Remediation Program. National Research Council, Washington, D.C.

NRC (National Research Council). 1994b. Ranking Hazardous-Waste Sites for Remedial Action. National Academy Press. Washington, D.C.

Suggested Citation:"Part 3: Priority-setting, Timing, and Staging." National Research Council. 1995. Improving the Environment: An Evaluation of the DOE's Environmental Management Program. Washington, DC: The National Academies Press. doi: 10.17226/5173.
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Appendix ONE APPROACH

During the subcommittee's deliberations, one member was tasked with developing an approach to priority-setting that would incorporate the various characteristics and attributes that the subcommittee believed were important. This appendix contains the result of that effort.

The proposal stimulated some controversy. Some subcommittee members thought it was a useful contribution which would clearly improve the budget formulation and other priority-setting processes. Other members and reviewers considered it naive, academic, infeasible, and bureaucratic. Because of time constraints, the subcommittee was unable to perfect the proposal in response to these comments.

Thus the original proposal is included in this appendix, without the subcommittee's modification or endorsement, in the belief that it may contain some concepts that would be of interest and value to the Department.

The proposed framework builds upon the existing budgeting process and incorporates substantial involvement at the local level although leaving the decision-making ultimately at the national level. The framework begins with the clear articulation of DOE's priorities for EM expenditures and, proceeding through a nine-step process, finally gives some leeway to the local stakeholders to make a final choice about the priorities which best suit them.

Define Priorities: The proposed process would begin with EM, with substantial input from its various stakeholders, identifying the full list of factors that should be taken into account in setting priorities.

Suggested Citation:"Part 3: Priority-setting, Timing, and Staging." National Research Council. 1995. Improving the Environment: An Evaluation of the DOE's Environmental Management Program. Washington, DC: The National Academies Press. doi: 10.17226/5173.
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We suggest that DOE consider developing the full list of factors through a “bottom-up” approach. In such a process, the stakeholders at the individual facilities would be asked to review an initial list of factors and recommend modifications or additions to it.

These reviews and suggestions would be aggregated through the regional offices and combined at Headquarters. They would then undergo a process of consolidation and redefinition.

The goal of this process would be to come up with a manageable set of priority factors which are inclusive and clearly defined so that they are interpreted consistently by everyone involved in the EM priority-setting system, from Headquarters staff to local advisory panels and other stakeholders. DOE might want to consider involving a national stakeholders panel in this winnowing and definition process to ensure that the criteria of inclusiveness and clarity are met.

Select Primary Factor: The second step would be for DOE to select from among this list what it considers to be the most important priority-setting factor. This should be done at the Headquarters level with the full involvement of the Assistant Secretary and Secretary.

The primary factor would most likely be related to the risk associated with an activity. Examples of possible primary factors related to risk would be the risk that would exist were the activity undertaken, the reduction in risk that would result from undertaking the activity, or the risk reduction per dollar spent that would be associated with undertaking the activity.

It is important that the primary factor demonstrate two characteristics. One is that it can be quantified on a scale that allows activities to be ranked from most important to least important. The second is that the factor metric, i.e., the means of estimating the extent to which each activity satisfies this factor, be determined consistently across all of the activities. The value placed on the primary factor metric must be independent of where the activity would occur and free of any biases that the rater might have. Assuming that risk or risk reduction is a component of the primary factor, this second criterion suggests the advantage of having risk assessments carried out by a neutral third party.

Appoint Trustees for Other Factors: The third step would be to designate trustees to represent each of the other priority-setting factors. These trustees should be Headquarters employees, probably assigned to the budget office. Their responsibility would be to help EM achieve the best possible priority-setting result by ensuring that the issue for which they are the trustee is given adequate consideration in this process.

Their primary loyalty must be to the DOE, not to the issue. Their goal should be to ensure that EM's budget and other priority-setting systems reflect rational, efficient, and equitable weighing of all of the DOE's priorities. Their responsibility would be to see that their factor is given due consideration.

Suggested Citation:"Part 3: Priority-setting, Timing, and Staging." National Research Council. 1995. Improving the Environment: An Evaluation of the DOE's Environmental Management Program. Washington, DC: The National Academies Press. doi: 10.17226/5173.
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This does not mean maximum consideration. They should not operate as representatives of particular interests who try to maximize the resources dedicated to these interests. They should operate as trustees of these interests who ensure that the interests are given fair and adequate consideration.

This is a subtle but important distinction. It is to clarify their role as trustees rather than representatives that argue for them being employed in the Headquarters budget office. Another mechanism for discouraging them from taking on a representational rather then a trustee role would be to periodically reassign factors among the trustees.

To fulfill their responsibility they should learn as much as possible about why local stakeholders may have ranked various activities as very important according to their factor. In many cases this importance would be communicated to them by the stakeholders most concerned about this factor. If this communication does not occur naturally, the trustee would have a responsibility to obtain such information by talking to the local interests after reviewing the activity summary sheets described below.

Activity Summary Sheets: The budgeting or other priority-setting system should be based upon activity summary sheets similar to those DOE is apparently using at present. The summary sheets should include a terse description of the activity and a rating of the importance of the activity with respect to each of the priority-setting factors. To the extent possible, the rating for the primary factor should be quantitative on a cardinal scale. The ratings for the other factors would also benefit from reasonable quantification, but a qualitative indication of relative importance would suffice as well.

The development of these summary sheets should begin at the local level and be fully informed by review and contributions of local advisory panels and other stakeholder input. There may be a need to modify the ratings as the summary sheets are reviewed at the regional and national level in order to improve their commensurability, but the reasons for such modifications should be indicated and be part of the public record.

These summary sheets would provide the basis for, and a public record of, the priority-setting system.

Initial Ranking: The activities would be initially ranked, from most important to least important, according to the primary factor. If the evaluation of this factor across activities has met the criteria of objectivity and consistency, this initial ranking would be a straightforward tabulation of the information on the summary sheets.

The results of this initial ranking would then be distributed to the trustees and possibly throughout the system including the local stakeholder groups, in preparation of the re-ranking process.

Re-Ranking: During the re-ranking process the trustees would argue for activities to be raised or lowered in the ranking because of the importance of the factor for which they are the trustee.

Suggested Citation:"Part 3: Priority-setting, Timing, and Staging." National Research Council. 1995. Improving the Environment: An Evaluation of the DOE's Environmental Management Program. Washington, DC: The National Academies Press. doi: 10.17226/5173.
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For example, the trustee representing cultural values might argue for a particular activity to be raised in the ranking because of the extent to which this activity would satisfy a strong tribal, cultural, or spiritual value in spite of the activity's relatively low impact on human health risks.

The trustee representing the cost reduction priority might argue that certain activities be lowered in the ranking because they address risks that would be attenuated naturally if nothing were done. A containment and wait strategy might result in significant cost savings in such a case over the long run.

The trustee representing compliance requirements, on the other hand, might argue that the same activity be raised in the ranking because it is explicitly identified in a tri-party agreement, and failing to undertake this activity could result in a strong enforcement action by the applicable regulatory agency.

The trustee representing EM's innovative technology priority might argue that a particular innovative technology activity be raised in the ranking and several clean up activities be lowered, because the innovative technology activity promises to achieve significant cost savings in these types of cleanups in the future. If such a re-ranking were agreed upon, the individuals responsible for those cleanup activities would have an incentive to ensure that the technology development activity achieved that goal.

To the extent possible, re-ranking decisions would be made by a consensus of the trustees and the individual responsible for presenting the ranking to the Assistant Secretary (usually the budget director). Where consensus is not reached, the disagreement would be noted for final resolution by the Assistant Secretary.

In order to satisfy the objective of transparency, the reasons for any reranking decisions should be made explicit, written down on the activity summary sheet, and made part of the public record of the priority-setting exercise.

Proposed Final Ranking: The proposed final ranking would be presented to the Assistant Secretary along with a summary of the disputes that could not be resolved by the re-ranking committee. If there were an unreasonably large number of unresolved disputes, each of the trustees might be limited to identifying one or two disputes that the particular trustee wanted raised to the Assistant Secretary's level. The ranking would not be changed for those disputes that were not raised.

If a large number of disputes resulted from disagreement among the trustees about the relative importance that should be accorded particular priority factors, this question should be raised to the Assistant Secretary for guidance before the re-ranking is completed. The goal would be to have only the most important issues raised to the Assistant Secretary's level.

Final Ranking: The Assistant Secretary would make decisions regarding the disputes raised to his or her level to create EM's final ranking.

Depending upon the priority-setting system that is being undertaken, EM's

Suggested Citation:"Part 3: Priority-setting, Timing, and Staging." National Research Council. 1995. Improving the Environment: An Evaluation of the DOE's Environmental Management Program. Washington, DC: The National Academies Press. doi: 10.17226/5173.
×

final ranking will usually undergo further reviews and modifications before it becomes truly final. Depending upon the rules that the DOE, the Office of Management and Budget, or others might have imposed upon this process, it may not be possible to make the final EM ranking or subsequent modifications public.

Nevertheless, at some point there will be a final “ranking” of some sort which will be public. In the case of the budget, the form of this final ranking will be a list of those activities which are included in the budget. The more public this process is, the more it will satisfy the criteria of transparency and credibility that are important for a priority-setting system.

A Possible Final Local Review: The process described has substantial local involvement in defining and rating the importance of the activities. However, the ranking and re-ranking are carried out, albeit informed by this local information and assessment, predominately at the national level.

The DOE may, if it is allowed to do so, want to provide the local level with a final opportunity to modify the ranking. This could be done by allowing the local site-specific advisory group to propose the substitution of a local activity that is below the cutoff line (e.g., unfunded in the budget) for another local activity of equivalent cost that is above the cutoff line. The presumption would be that such a substitution would be allowed as long as it was not unreasonably inconsistent with national priorities, particularly the primary priority factor.

Suggested Citation:"Part 3: Priority-setting, Timing, and Staging." National Research Council. 1995. Improving the Environment: An Evaluation of the DOE's Environmental Management Program. Washington, DC: The National Academies Press. doi: 10.17226/5173.
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This book addresses remedial action and waste management problems that the DOE and the nation are now facing that are the result of 50 years of nuclear weapons development and testing—problems that require a reengineering of systems and a reexamination of the scientific, engineering, and institutional barriers to achieving cost-effective and safe stewardship of the nation's resources. Improving the Environment evaluates the DOE's environmental management program in four areas: regulatory measures, organization and management, priority-setting, timing and staging, and science and technology.

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