October 2006 The Hush-Hush Effect Long-overdue attention is paid to Y-12’s building infrastructure By Alexei Smirnov
When an internal report at the nation’s premiere nuclear weapons plant says that “activity is already underway between buildings 9201-1 and 9204-1,” it could mean so many things. But one should not be afraid to ask—it’s not 1943 anymore.
For an institution that for decades was steeped in top-level secrecy, the Y-12 National Security Complex in Oak Ridge is quite upfront about its mission these days. In an effort to realign priorities and reduce operating costs—a headache faced by many a government entity amid tightening budgets—top management at Y-12 went as far as to employ corporate-style financing to underwrite its construction expenditures. So, “activity” only means construction work in this instance. What a relief.
But hiring a private developer and contractor is a big step for a plant that makes nuclear weapons components, stores bomb-grade uranium and supplies nuclear goods for American submarines.
In large part because of the sensitive work that goes on there, Y-12 has been long overdue for an overhaul of its infrastructure. Take, for instance, administration building 9704-2, which was built out of wood in the mid-1940s by the U.S. Army and was demolished only two years ago. When nuclear technologies company BWXT of Lynchburg, Va., took over the management contract at Y-12 in 2000, its balance sheet featured 700 disparate houses and barns scattered across the 800-acre lot. “We have torn down well over one million square feet of space in the past couple of years,” says Randy Spickard, national security programs director at Y-12. “It was inefficient and costly to manage.” Indeed, maintenance costs for 1940s-vintage buildings were going through the roof, while navigating the Y-12 campus was no easy task. (Imagine trying to remember that building 9720-8 is equipment storage and 9610 is an electrician’s shop.)
Having calculated that Y-12 would save money on demolition and new construction, Spickard, who is in charge of supplying nuclear fuel to the Tennessee Valley Authority and the U.S. Navy, spent the last two years convincing the U.S. Department of Energy to sign off on a 25-year, $125 million private sector financing of the new construction project at Y-12.
“It’s very creative,” says Wayne Roquemore, president of Knoxville commercial development company Lawler-Wood, of the financing structure for Y-12’s two new buildings, which are slated for completion next fall. Lawler-Wood won the Request for Proposal (RFP) for the development contract and became the first private developer hired by the National Nuclear Security Administration under an alternative financing program that puts the land under the two buildings on the Oak Ridge and Anderson County tax rolls. There are no government guarantees and no government leases on the 500,000 square feet of space under construction, yet Lawler-Wood was able to secure a AAA rating—the highest—for its $154-million bond issue. Perhaps the bond insurer knows a thing or two about the value of national security. Lawler-Wood will manage and lease the buildings, leading to what the government estimates will amount to hundreds of millions of dollars in savings during the next several years.
Consolidating 1,500 employees from 40 buildings into two also made sense logistically. “As people working at Y-12 say, at any given time, a good number of folks are out on the street walking,” Roquemore quips. While fitness in the workplace is commendable, carrying nuclear components from one shop to another does not seem like such a great idea. Spickard adds that given the numerous efficiency studies underway and how the nation’s top nuclear plants always compete for business, it’s a good idea for Y-12, one of the largest manufacturing facilities in Tennessee with 4,700 employees, to get ahead of the curve on infrastructure upgrades.
In another blow for meaningful naming conventions, the new buildings will actually have names instead of alphanumerics. One is dedicated to the longest surviving manager of Y-12, Jack Case, while the other is named in honor of the local community that built uranium-235 for the atomic bomb that was dropped on Hiroshima, Japan.
Who knows? Maybe even the staid appellation of Y-12 itself won’t be safe from a name change.
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