Uncertain federal budgets leave Hanford officials looking for flat budgets

By Annette Cary, Tri-City HeraldJanuary 25, 2013 

The uncertain federal budget has Department of Energy officials in the Tri-Cities looking for flat or slightly declining budgets ahead.

"Flat is the new up," said Roger Snyder, manager of the Department of Energy Pacific Northwest Site Office, at the Tri-Cities Regional Economic Outlook conference in Kennewick on Thursday.

He has prepared for budgets for Pacific Northwest National Laboratory in Richland to have a slight downward drift, he said. His DOE office oversees work at the national lab.

Hanford's budgets could continue to be around $2 billion annually in the foreseeable future with some ups and downs, said Greg Jones, DOE's Hanford chief financial officer.

Not much was said at the conference about the possibility of sequestration in March and what that would mean for federal money for Hanford and PNNL.

Federal agencies were instructed in January to make plans for a reduced budget in case Congress does not amend the law and President Obama is required to issue a sequestration order to cut about $85 billion from spending nationwide in the fiscal year that began in October.

At Hanford, employment has dropped from about 10,000 workers to around 9,000 workers during about the last year. Although employment is down, it should be stable for the near future, with the usual adjustments based on the skills that are needed, said Greg Jones, DOE's Hanford chief financial officer.

The nuclear reservation, where plutonium was produced for the nation's nuclear weapons program, should continue to provide jobs out to 2050 or 2060, as environmental cleanup continues, he said. Work is under way to shrink the contaminated portion of the 586-square-mile site to a contaminated area at its center in 2015, but significant work will need to be done in central Hanford, he said.

In 2012, DOE contractors at Hanford spent $872 million on subcontracts, with almost half of that spent in the region, he said.

"It is a big engine for the local economy and that will continue," he said.

At Pacific Northwest National Laboratory, with about 4,500 employees, 428 workers left in 2012, about half of those because of restructuring and realignment, Snyder said. At the same time, 185 new workers joined the lab, he said.

The fiscal 2012 budget was $1.032 billion, down from $1.101 billion the year before.

Throughout 2012 the lab looked at likely budget scenarios for this fiscal year and made spending and staffing adjustments based on those scenarios, said Greg Koller, spokesman for PNNL, after the conference. That left it well-positioned going into fiscal 2013 and it should remain in good shape if spending levels are maintained, he said.

"While everything looks flat, we are somewhat holding our breath to see what the budget brings," Snyder said.

The lab performs work for a wide range of agencies, including the Departments of Energy, Defense and Homeland Security. Uncertain federal budgets put customers on edge and that has a delayed effect on the lab as customers adjust spending, Snyder said.

The nation is operating on a continuing resolution through March 27 after Congress failed to pass a budget for the fiscal year that began Oct. 1.

If sequestration occurs, all agencies that receive federal funds, including the national labs, likely will be impacted, Koller said. However, it's unclear what the cuts could be or how they would be distributed across programs and projects within agencies for which PNNL provides research work, he said.

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