Facilities Modernization At Y12 National Security Complex

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Facilities Modernization At Y-12
National Security Complex
The legacy of an aging Cold War plant sized to
meet Cold War needs is directly related to Y-12s
facility and infrastructure cost over the next
ten years.
2
53 of the Y-12s total floor space was
constructed before 1953 These buildings have
been in continuous use and reuse for more than 50
years.
Gross Square Feet (GSF)
ORNL
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Y-12 has a significant amount of aging floor
space . . . Even when compared to other DOE
sites.
Savannah River
INEEL
Los Alamos
33 GSF gt 35 years
50 GSF gt 24 years
50 GSF gt 30 years
Lawrence Livermore
Nevada Test Site
Y-12
70 GSF gt 50 years
54 GSF gt 30 years
60 GSF gt 31 years
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• Problem
• Y-12s aging infrastructure is impacting our
  ability to fulfill our mission.
• NNSA has charged BWXT Y-12 with addressing
  aging infrastructure by 2006.

Solution

• Integrated Financing Program
• Line Item funding for mission-related
  improvements
• FIRP funding for deferred maintenance reduction /
  recapitalization / facility removal
• Alternate (private sector) financing for
  reconfigurable laboratory and technical support
  space

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New PIDAS
MMSC
HEUMF
EU Reno
Visitors Center Badging
DU Relocation
Admin/Tech
Café / Med Prototype
QE Relocation
Records Storage
Vehicle Mgmt
Fire Station
Beryllium
Materials Mgmt
NMAA Storage
Upgrade Steam Plant
Purification Plant
PSS / EOC / TOC on South Ridge
Committed Line Item Projects Proposed Line Item
Projects Proposed Line Item Renovations
FIRP / GPP Funded Projects
Alternate (Private) Financed Projects
Excess Facilities
Construction and renovation of these line item,
FIRP, and privately financed projects will allow
old, expensive floor space to be vacated,
declared excess, and either demolished or moved
to EM.
Discrete, freestanding projects that support
mission-essential functions are the most
appropriate use of FIRP funds. These may include
Weapons Records Storage, Fire Station, Vehicle
Management, and Materials Management.
The most appealing projects to attract private
financing are commercial labs, light
manufacturing, and technical support space in a
multi-use complex large enough to generate
significant rental income. NNSA and DOE support
alternative financing.
NNSAs limited line item funds should be applied
to projects that are mission-essential major
science and manufacturing facilities and
infrastructure
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Line Item Projects

• To improve operating efficiency
• To reduce health and safety risk of operations
• To maintain Y-12s ability to fulfill its
  mission

Committed Line Item Projects
Purification Plant 10,000 GSF Highly Enriched
Uranium 103,000 GSF Manufacturing
Facility
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FIRP Projects Purpose

• To refurbish the aging nuclear weapons complex
• To reduce deferred maintenance by removing
  excess facilities
• Projects are limited to a maximum of 5M

Possible FIRP Projects
Medical Facility 25,000 GSF Material
Management 20,000 GSF Records Storage (2) 40,000
GSF Fire Station 25,000 GSF Vehicle Management
Facility 25,000 GSF
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Alternate Funding

• To give NNSA access to private financing
• To take advantage of commercial financing and
  construction practices more able, agile,
  and affordable
• ORNLs experience indicates 50 construction
  cost savings
• PNL, LANL, INEEL, all implementing or
  assessing alternate finance projects

Alternate Funding Candidate Components
Prototyping Laboratory Manufacturing Materials
Research Engineering and Science Offices ESH
Offices Management Offices Occupational Health
Facilities Employee Interface Cafeteria,
Conferencing
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Integrated Financing 5 -Year Plan
Project Construction Schedule
Aggressive, integrated financing program allows
revitalization of mission-essential and technical
support facilities within a 5-year period.
FY03
FY04
FY05
FY06
FY07
FY08
Records
FIRP
Office
Alternate Financing
Line Item
Fire Station
Vehicle Management
Materials Management
Materials Manufacturing Science Center
Visitors Center
Purification
HEU Materials Facility
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Alternate Financing Preliminary Planning Schedule
FY04
FY03
Develop Feasibility Study / Business Case
Prepare EOI Package
Select Qualified Bidders
Prepare RFP Package
Select Finance/ Design/ Build/ Lease Developer
EA FONSI Issued
Establish Non-Profit Holding Company
CERCLA Covenant Deferral Request Approved
Transfer Quitclaim Deed
Start Private Sector Construction
We Are Here
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Y-12 National Security Complex
Alternate Financing Preliminary Program
Candidates for Replacement with Alternate Funded
Project(s)
Building Groups Total GSF Total Pop Avg.
Age Current Major Occupants Administrative
Office Buildings 290,000 364 50 YAO, FIS,
ESH, PA, FBM, SS Engineering Office Buildings
329,700 525 56 BS, PPI, PM, FIS,
ESH Critical Support Buildings
85,000 82 55 ET, ESH, FIS, BS Research
Development Buildings 459,300 241 49 Mfg, ET,
QA TOTALS / Average 1,164,000 1,212 53
Key
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Basic Programming Needs

• Provide office/technical space for approximately
  900 employees
• GSA recommends average 200 Usable Square Feet
  (USF) per employee
• Many in this population are engineers or senior
  managers who require more space therefore, use
  225 USF/person
• Assume 85 building efficiency

Admin/Technical Space
900 Employees _at_ 225 USF/person 202,500
USF 202,500 USF _at_ 85 efficiency
240,000 GSF Say, 240,000
GSF
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Basic Programming Options

• Provide agile laboratory and prototyping space
  for approx. 240 employees
• Advanced Machining and Technology
• Basic Weapons Materials Science
• Prototyping, Deployment, Test Beds, and
  Technology Development
• Nuclear Nonproliferation Conferencing and
  Classrooms

Prototyping Facility
Reconfigurable light labs and high-bay
prototyping space Classrooms, meeting rooms, and
offices Assume, 175,000 GSF
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Basic Programming Needs

• Current cafeteria is 55 years old and serves
  460 meals per day
• Current medical facility is 55 years old and
  does 3,000 physicals/year
• Y-12 lacks meeting and networking space that
  would encourage interaction, information
  exchange, and integration of functions

Support Interface Space
Cafeteria 15,000 GSF Occupational
Health 15,000 GSF Conferencing Collaboration
Space 20,000 GSF Say,
50,000 GSF
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Facilities Modernization At Y-12
National Security Complex
Alternate Financing Preliminary Program
MMSC Alternate 1
MMSC Alternate 2
Excess facilities
Manufacturing Materials Science Complex (MMSC)

• Finance/Design/Build/Leaseback allows NNSA to
  avoid capital outlay
• 1.2M GSF of inefficient, unsafe, and costly
  space can be excessed
• And replaced with 465,000 GSF of able, agile,
  affordable space

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Annual Costs, Cost Savings Avoidances
Total annual lease payments on 465,000 GSF _at_
22.75/GSF
10,600,000 Based on ORNLs negotiated lease rate
Annual Costs
1. Maintenance and utility cost
avoidance 4.50/GSF -- 8.00 / GSF 5,200,000
-- 9,300,000 2. Deferred maintenance cost
avoidance per year for 10 years 2,600,000 --
2,600,000 3. Renovation cost avoidance 1.2M
GSF _at_ 75 -- 120 / GSF spread over 10
years/year 8,700,000 -- 14,000,000 4.
5 -- 20 staff efficiency 6,000,000 --
24,000,000 Net Annual Savings
22.5M to 50M Annual cost avoidances less
annual costs
Annual Cost Savings Avoidances
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Cost and Savings Graph over 25-year Life
Cumulative Cost Savings 382,000,000 --
965,000,000
Cumulative Lease Payments 254,400,000 --
254,400,000
Net Savings over 25 Years 127,600,000 --
711,000,000
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Deed / Lease Process per ORNL
Deed/lease arrangements are designed to access
private capital in response to a government need
Quitclaim Deed
NNSA
Ground Lease
Deed bare land to private sector non-profit
Facility Lease
Lease bare land to selected design/build/ lease
developer
Operating Lease (Approved by NNSA)
Lease facility back to non-profit
Private Sector
MO Contractor BWXT Y-12
NNSA has option to purchase facility at nominal
cost at prescribed time
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Three Basic DOE / NNSA Questions

• Financial risk
• How is the long-term financial risk for private
  sector construction addressed?
• Fairness of price
• How is the government assured that costs will be
  at fair market prices?
• Cost to NNSA
• Will this approach involving private sector
  construction result in higher costs to NNSA?

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Financial Risk

• To Investors
• Convince potential investors that NNSA has
  a long-term mission
• Convince them that Y-12 is an integral part of
  that long-term mission
• Convince them that the proposed complex is
  an essential part of the long-term mission
• To NNSA
• MO contractors sublease will have a 12-month
  cancellation provision, so NNSAs risk would
  never be more than 12 months lease cost

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Fairness of Price

• To NNSA
• Use competitive procurement procedures for
  finance/design/build/leaseback developer
• MO contractors sublease will require NNSA/DOE
  approval
• Lease cost/SF used in this proposal is based on
  ORNLs recently negotiated rate, which was
  reviewed against current regional costs
• Some variation in cost is expected depending on
  the final site locations attractiveness to the
  private sector and site preparation issues

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Cost to NNSA

• Avoids capital outlay
• Avoids or reduces operating costs
• Maintenance
• Utilities
• Deferred maintenance
• Facility renovations
• Improves operational and staff efficiency
• Preliminary cost/benefit analysis shows potential
  savings to NNSA of
• 127M to 711M
• over the 25-life of the complex

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Architects Concept of MMSC
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Architects Concept of MMSC -- Alternate 1
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Architects Concept of MMSC -- Alternate 2
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Candidates for Replacement with MMSC
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Cost Avoidance Savings Analysis
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MMSC Square Foot Need Analysis
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MMSC Lease Cost Analysis
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25-Year Cost/Benefit Analysis