Pete V. Domenici
United States Senator

Keynote Address
Energy Communities Alliance
Annual Conference
Washington, D.C.
March 4, 1999

It's a pleasure to be back with your Energy Communities Alliance again this year. Each of you represents a facility that is important to the national missions of the Department of Energy. That means that all of you are active participants in our nation's security, where I define security to encompass the broadest range of issues including environmental, military, energy or science perspectives.

I understand that this is one of the first years when representatives of some of the Russian closed nuclear cities are joining you here. I want to extend a special welcome to them. On my visit last year to Sarov, I was most interested to learn more about the challenges facing your cities. Stronger interactions between Russian and American colleagues from these very similar cities should help both nations better manage the required transitions.

Let me start with a few notes on budgets. Despite the wonderful news of continued surpluses, competition for the scarce resources of the federal government will remain fierce. The Department and its contractor organizations must earn the respect and support of the nation's taxpayers by solid performance on national goals. Each of you has a role to play in ensuring that the view of the Department improves; because as you well know, the Department is not viewed as one of the stellar performers among the federal agencies.

Secretary Bill Richardson and I are in very frequent communication to craft strategies to advance the roles of the Department and help it succeed. He has already taken on some of the tough decisions that have been languishing. But, there are still many in Congress who suggest elimination of the Department. The number of such calls and their intensity probably is trending down somewhat. But none of you should assume that the future of the Department is secure.

The Worker and Community Transition budget of the Department has been reduced over the last few years. It was $61 Million in FY1998 and $28 Million in FY1999. The President proposed a small increase for FY2000. Whether or not his number is the final answer or not, the long term trend is clear and I see no probability or strong rationale for reversing that trend. The major consolidations at the Department are largely accomplished and directions for each of the sites are fairly clear now.

For some of your sites, that direction involves cleanup and shutdown - like Rocky Flats. For others of you, your charter involves opening of key national facilities, like the Waste Isolation Pilot Plant or Yucca Mountain. Sites in these categories are under particular scrutiny in Congress. Progress at places like Rocky Flats is greatly appreciated, and the clear focus at that site on cleanup and shutdown is admirable. For some other sites, there is growing skepticism in Congress that cleanup is viewed as a long-term mission guaranteeing jobs far into the future. That sort of perception serves your sites very poorly, and undermines support in Congress.

WIPP and Yucca Mountain are sites with critical future national roles in accepting waste materials. In both these cases, technical progress has been made, yet State actions are seriously delaying opening the sites. I've publicly warned that delays within my home State are very likely to negatively impact willingness of Congress to continue strong funding. In Nevada, I've frequently questioned why the federal government is pumping about $400 Million annually into an empty hole that most of the State leadership is determined to keep empty.

As local leaders who understand the rationale for these sites and the extensive safety requirements already levied on them, you need to be as proactive as possible in helping other regional leaders understand real, not inflated, risks of operations. I know it is hard, but you can help influence the debate within your States as onerous regulations are onsidered.

For any of your sites, I know that land transfers and economic development figure prominently into your thinking. Over the past couple of years, I've helped with language that encourages appropriate transfers. The pace of these transfers is slow, frustrating to me and to you. That slowness is driven from many perspectives, including the complexity of some of the legal and environmental issues. But if transfers in your areas are being delayed by times that you view as unnecessary, you need to let me know and I'll try to help.

Before leaving land transfers, I should note that some of these transfers require environmental remediation before transfer. These will present serious funding challenges, and will be delayed until resources are identified. You have a strong role in influencing this process. As you identify future uses of land that may be transferred, you can significantly reduce remediation costs by defining and limiting options for future use. And when you see local groups trying to demand ultra-clean sites before transfer, perhaps you can seek to inject realism into the debate.

One of the key issues on these transfers involves the Ahow clean is clean enough@ debate. Frequently this involves application of risk evaluations for low doses of radioactivity. There are many scientists who seriously question if we are drastically over-stating the risks of low doses of radiation. If they are right, today's cleanup standards are far too tight, we are spending far too much on cleanup, and we are taking far too long to accomplish the cleanup. I've established a program to examine the cellular and molecular basis for evaluation of these radiation risks. As this program returns information, the nation may be able to refine these standards. If the present standards are thus determined to be too strict, your land transfers might be simplified.

Economic development is another area of great interest for your communities, independent of your site's future. I hope that each of you recognizes the vital role for diversification of your regional economies. One approach to this concern has been the encouragement that I and other Congressional leaders have provided to ensure that regional economic development is now built into each operating contract. That economic development can take various forms, from creation of spin-off companies to requirements that major contractors and subcontractors play strong roles in economic diversification. In New Mexico, I've seen good examples of how these approaches are working.

Last year I introduced the Partnerships Enhancement Act, which was included in the final Defense Authorization legislation. That Act provided guidance to the Secretary of Energy to encourage partnerships among DOE facilities, universities and industry. It offers a number of opportunities for enhancing interactions that your sites should be exploiting.

Last year, I also introduced legislation to reform the Research and Experimentation Tax Credit, usually called the R&D Credit. The original idea for this Credit was to encourage innovative research , but for a variety of reasons, it has not been working well. I proposed making this credit permanent plus a suite of critical changes. This year, I've agreed to re-introduce similar legislation with Senator Bingaman as co-sponsor.

If the R&D Credit is permanent, U.S. industry can develop long term research strategies. My bill encourages industrial research with small businesses, universities, and national laboratories. Your communities should study the opportunities that might be provided with this bill. You may see interesting ways to encourage better utilization of the technical capabilities of your facility and also leverage that use into interesting economic development benefits for your region.

I've also recently announced that I'm developing a new program to explore potential health science applications of technologies developed within DOE programs. I'll be working to establish this new program this year in both DOE and NIH legislation, and it should provide some exciting new opportunities for your facilities and for regional economic development.

One trend within the Department's budget, which I've recently questioned, is their continuing interest in cutting back and eventually killing the Technology Partnership Program or TPP. That program encourages and funds partnerships between labs and industry. The cutbacks proposed by the Department have a chilling effect on the willingness of researchers to explore industrial collaborations. I feel very strongly that our mission contributions are optimized when the labs and plants have access to the best technology, whether within their walls or in universities or industry. Furthermore, the TPP has been an important source of funding for small business programs, and these are frequently the efforts that best help to diversify regional economies. My Appropriations Subcommittee will be very carefully reviewing these proposed cuts.

Let me direct a few comments specifically to your Russian guests. Our two nations now have a unique opportunity to create a foundation for global stability. I've been associated with programs for many years that help stabilize your research institutes and keep your scientists at their institutes. I have worried that the economic uncertainties in your great nation could force some scientists to explore options outside of Russia. I feel very strongly that it is in Russia's interest, as well as the best interests of the rest of the world, that your weapon scientists stay in Russia and, wherever possible, begin to transition to commercial work. Programs like Initiatives for Proliferation Prevention or IPP have had some limited successes in this stabilization. And the new Nuclear Cities Initiative or NCI should provide additional opportunities to address the special problems found in your closed cities.

When I visited Sarov last year, I was struck by the extreme difficulties that you face in developing commercial opportunities in your nuclear cities. The difficulty of access, both from transportation and security perspectives, impedes your success. You need to work diligently to relax these constraints. Your tax system is another major drawback, since it undermines many incentives for entrepreneurs. The current serious financial disarray only further complicates the willingness of foreign companies to invest in Russian opportunities.

I know that many of you share my concerns with these challenges and are working to overcome them. For my part, I will be trying to protect the funding for programs like IPP and NCI and to convince my colleagues that these programs are strongly in our mutual best interests. At the same time, I recognize the immense difficulties you face in achieving commercial success in these cities and you have my best wishes for your continued progress.

Again, thank you for the invitation to join you again here today. Your Energy Communities Alliance plays an important role in supporting the facilities that underpin many of our nation's security objectives.