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Saturday, May 14, 2016
LLC model
Why did the LLC model for Lab contract operations not work for LANL? It
works rather well for other DOE Labs, so maybe it was the leadership of
the LLC that was the problem, not the contract model.
64 comments:
Anonymous
said...
SNL is not an LLC, and LLC model has also failed at LLNL. From this it seems like a LLC model it does not work well for a scientific laboratory. All the other DOE science labs, like ANL, ORNL, Fermi Lab and so on are not LLCs. It seems to work for plants or clean up jobs but not science labs.
Actually most of these are LLCs. Here are the DOE Lab and their operators from from the official list of FFRDC at http://www.nsf.gov/statistics/ffrdclist/
Ames Laboratory Administrator: Iowa State University
Argonne National Laboratory Administrator: UChicago Argonne, LLC
Brookhaven National Laboratory Administrator: Brookhaven Science Associates, LLC
Fermi National Accelerator Laboratory Administrator: Fermi Research Alliance, LLC
Idaho National Laboratory Administrator: Battelle Energy Alliance, LLC
Lawrence Berkeley National Laboratory Administrator: University of California
Lawrence Livermore National Laboratory Administrator: Lawrence Livermore National Security, LLC
Los Alamos National Laboratory Administrator: Los Alamos National Security, LLC
National Renewable Energy Laboratory Administrator: Alliance for Sustainable Energy, LLC
Oak Ridge National Laboratory Administrator: UT-Battelle, LLC
Pacific Northwest National Laboratory Administrator: Battelle Memorial Institute
Princeton Plasma Physics Laboratory Administrator: Princeton University
Sandia National Laboratories Administrator: Sandia Corporation, a subsidiary of Lockheed Martin Corp.
Savannah River National Laboratory Administrator: Savannah River Nuclear Solutions, LLC
SLAC National Accelerator Laboratory Administrator: Stanford University
Thomas Jefferson National Accelerator Facility Administrator: Jefferson Science Associates, LLC
While I can't speak to LANL's needs, after 25 years at LLNL in the operations side of things, the LLC model could work if the industrial partners were ditched. I really would like to see either a solely UC owned LLC like the ANL model or a UC-Battelle LLC like ORNL.
The industrial partners in LLNS have added zero value to LLNL operations, everything they do is for show no substance. Look at the turn over in top managers for ES&H, O&B, HR, Assurances, etc. The industrial partners brought in someone from another DOE site, that person screwed things up at LLNL and then leaves... turning the mess over to a long time LLNL employee to become manager and clean things up.
Actually most of these are LLCs. Here are the DOE Lab and their operators from from the official list of FFRDC at http://www.nsf.gov/statistics/ffrdclist/
The key difference is if the LLC "for profit" or for service, LLNS and LANS are "for profit:
None of the below are "for profit".
Ames Laboratory Administrator: Iowa State University
Argonne National Laboratory Administrator: UChicago Argonne, LLC
Brookhaven National Laboratory Administrator: Brookhaven Science Associates, LLC
Fermi National Accelerator Laboratory Administrator: Fermi Research Alliance, LLC
Idaho National Laboratory Administrator: Battelle Energy Alliance, LLC
National Renewable Energy Laboratory Administrator: Alliance for Sustainable Energy, LLC
Oak Ridge National Laboratory Administrator: UT-Battelle, LLC
Thomas Jefferson National Accelerator Facility Administrator: Jefferson Science Associates, LLC
In fact Sandia National Laboratories Administrator: Sandia Corporation, a subsidiary of Lockheed Martin Corp. Is not realy for profit either from what I can tell.
All of the LLCs are "for profit" in the sense that they hope to generate significant income from fees, which are shared among the partners. Otherwise there is absolutely no reason for a company like Bechtel to participate in a LLC. Same with SNL, Sandia Corp. is a subsidiary of Lockheed, which probably owns 100% of the stock and gets income from the fees. It's all about fees, which is a key difference from the old UC-managed LLNL and LANL.
It has become sort of an urban legend that NNSA "required" for-profit companies to bid on the LANL and LLNL contracts. The RFPs for these contracts contained no such requirement, NNSA only required that any bidder for the contracts be organized as a distinct, special-purpose legal entity dedicated exclusively to the performance of the contract. UC choose the LLC model because it allowed a public institution (UC) to directly share the huge contract fees with the industrial partners it felt it needed in order to win the contract competitions.
The fee earned by LANS and LLNS is distributed to the four members of the LLCs, after deducting costs of certain key personnel compensation supplements and certain other non-reimbursable costs. Slightly different fee distribution formulas are used at LANL and LLNL, as set forth in each LLC agreement:
At LLNL the net income of LLNS, consisting of the earned fee as reduced by deduction of all non-reimbursable costs, is allocated to the four members of LLNS according to a negotiated, fixed formula.
At LANL the earned fee and any non-reimbursable costs are allocated separately to the members of LANS, according to somewhat different negotiated formulas.
LANS and LLNS as LLCs, are taxed as partnerships for federal income tax purposes. This means the LLCs themselves do not pay federal income taxes, because they are treated as “pass-through entities,” and the members pay income tax only on their shares of the fees, in accordance with their particular tax circumstances. UC, as a nonprofit public research university, pays no federal income tax on its fee share and dedicates its net fee share to research and other purposes consistent with this status. The corporate partners, as for-profit organizations, are subject to income tax on their share of the net income distributed to them. This accommodation of the distinct tax statuses of UC and its partners is the primary reason UC went with the LLC structure for the partnerships.
From this it seems like a LLC model it does not work well for a scientific laboratory. All the other DOE science labs, like ANL, ORNL, Fermi Lab and so on are not LLCs. It seems to work for plants or clean up jobs but not science labs.
May 14, 2016 at 7:54 AM
7:54 AM is typical of the LANL view of the outside world. It is full of wrong statements, spouted out as facts. When faced with the truth, in typical LANL fashion, they draw conclusions based on their incorrect views, and stick with it even after it is shown to be wrong.
In fact, most of the DOE science Labs do operate as LLCs, including the specific ones claimed by 7:45 AM to be otherwise.
There is nothing wrong with the LLC concept for a Lab; however, in order to work at LANL it will require a different parent company in the lead. UC has shown itself incapable of functioning under the LLC structure.
Bull! Domenici wanted private business because "business does everything better." The contract change was absolutely to change a not-for-profit to a for-profit. The state and local governments had been after the tax money, too. The LLC model does not work because of Bechtel and their profit driven management. They are a private company very adept at wringing huge profits out of governments it holds hostage. The LLC model works at labs that have Battelle or University consortiums running them.
The for-profit change killed about 400 jobs at LANL and a comparable number at LLNL. It costs a lot more than money and it has destroyed science at both labs.
"7:54 AM is typical of the LANL view of the outside world. It is full of wrong statements, spouted out as facts. When faced with the truth, in typical LANL fashion, they draw conclusions based on their incorrect views, and stick with it even after it is shown to be wrong."
It was pointed out to you very clearly that the LLC models for LLNL and LANL are FOR PROFIT, and most of the others are not. This is not a LANL view of the outside world it is a FACT and points to the for profit model not working not the LLC model.
"In fact, most of the DOE science Labs do operate as LLCs, including the specific ones claimed by 7:45 AM to be otherwise."
Again most of these are not "FOR PROFIT". This is is not hard to understand and I think even you understand this distinction and why it just might might make all the difference.
"There is nothing wrong with the LLC concept for a Lab; however, in order to work at LANL it will require a different parent company in the lead. UC has shown itself incapable of functioning under the LLC structure."
A non-profit might work better. We have run the for profit model experiment and it has faild in both cases of the a science lab, LLNL, and LANL. It does not follow that UC has faild, it could be that UC-Bechtel "for profit model" has failed but not UC. In fact UC seemed to work great for 60 years which implies that the UC non-profit model works. This is not rocket science and yes even a reader such as you can follow the logic.
If anyone has interest in understanding UC's official view on the LLCs, UCOP wrote an introductory guide on UC’s involvement in LANS LLC and LLNS LLC back in 2007 that is at:
"Name a single lab operating LLC that UC is part of that functions well.
May 15, 2016 at 1:32 PM"
This is hardly an argument. UC ran LBL, LLNL and LANL just fine for 60 years, now it runs LLNL and LANL with a for profit LLC leading to failure in both cases. What are the possible conclusions? (1) The for profit model LLC does not work for a science lab no matter who runs it (most likely given the evidence at hand). (2) UC could run with a non-for profit LLC model and it could work well.
A much better question to ask is "Name a single science lab operating under a for profit LLC that functions well." Once you have this answered everything will be clear for you. Again this is not rocket science and it not that hard to figure out, so are you really that confused or will just stick to your "I hate UC" no matter what the evidence stance?
It is clear that the anti-Bechtel crowd is out in full force today.
May 15, 2016 at 6:07 PM
That is your only response? You having a rather bad day, perhaps it would be better to consider actual facts and statistics and try to address the points raised.
LBL is not managed by an LLC contractor. Please, try to keep up here.
May 16, 2016 at 7:04 AM
However LBL is doing much better than LLNL and LANL which which is evidence that for profit LLC models do not work for science labs and that UC can successfully run a science lab.
UC may be able to operate a lab such as LBL that is an extension of a world-class university campus. Not so clear that UC can operate a location that builds components for nuclear weapons.
LANL and LBL have little in common. What works for one doesn't have much to do with the other.
May 16, 2016 at 12:39 PM
Perhaps, but than again UC alone worked fine for LANL and LLNL for 60 years, so we have a couple of examples where it has worked. We now have two examples of where a for profit LLC has not worked. I think the conclusion is clear.
Superficial comparisons and statistics do not address underlying causes or unknown parameters. Any "conclusion" based on them would be unfounded in the extreme. As they say, life is a little more complicated than that.
LANL and LLNL operated under dramatically different conditions in that era. They had a clear mission, focused on direct support of UGT. They had nearly unlimited budgets, and very limited oversight from the Feds. Their mission had national importance to both the uniformed military and Congress. The country had Rocky Flats as a production facility.
Under these circumstances, UC operated both locations.
Today there are drastically different conditions.
Any "conclusion" based on conditions that no longer exist is indeed unfounded in the extreme.
Superficial comparisons and statistics do not address underlying causes or unknown parameters. Any "conclusion" based on them would be unfounded in the extreme. As they say, life is a little more complicated than that.
May 16, 2016 at 2:33 PM
Than how can you keep saying UC is so bad than? You cannot have it both ways.
LANS failed. UC was in charge of LANS. Ergo, UC failed.
May 16, 2016 at 5:28 PM
Well UC did not fail for 60 years. You can say UC failed when forced to partner with Bechtel, but history shows that UC alone ran the labs well during the time when it was most important. This would lead one to believe that adding Bechtel to the mix was the key to failure not UC.
The idea that the llc model is the problem is not supported by any facts. For the poster who claims "science is dead" at LLNL and LANL , there is a lot of evidence to the contrary. For the posters comparing lbl to LLNL and LANL , the obvious difference isn't the contract structure but who they work for: lbl works for doe/sc and LANL and LLNL work for NNSA. The mission of anl, lbl, bnl, ORNL is science for its own sake. The mission of SNL, LLNL , and LANL is national security. Very different missions, and very different management philosophies on the DOE side. There is a palpable cultural issue at LANL in the middle and senior management that encourages a nearly pathological disrespect for authority, which gets conveyed to the more junior staff. Break the rules even when they make sense. That does not exist at LLNL or SNL. Bechtel is really a sideshow, and we will see a divorce soon between them and UC in the LANL recompete, which I predict UC will lose. At LLNL bechtel is not very relevant except that they pay Gioconda's salary, and I challenge anyone to argue he doesn't do a good job. Lockheed really doesn't male much of a difference at SNL either. The structure of the contract doesn't matter very much, and the fees even today are not very large. What has made a significant difference is the relationship LANL and LLNL has with UC. Before, they reported the the President of UC, and we're treated as if they ran a campus. Now, they report to a clownish regent. That part has made a difference at both labs, mainly for the bad.
Than how can you keep saying UC is so bad than? You cannot have it both ways.
May 16, 2016 at 4:09 PM
I didn't say that. That was some other jerk. I just said that no reasonable or rationally supported conclusion can be made based on the "data" being promulgated on this thread. The situation is more complicated than that. If you aren't willing or able to do more research into the situation, you will be unable to support any conclusion by logic or by facts.
To the poster who claims that UC did the llc for tax reasons, that is false and also doesn't make sense. They did it because they wanted shared risk. Otherwise they could have just hired Bechtel and the others as subcontractors.the poster who calims this was domenici is wrong. The push came from the House, and cong Hobson of Ohio.
The idea that the llc model is the problem is not supported by any facts.
Where have you been in the last 10 years? Why do you think this blog and the LANL bogs existed? Do you we need to go through the list again? We did it already. The LLC "FOR PROFIT" model has been a failure, even NNSA, Vic Reis, and DOE say so, there is no denying it now.
"There is a palpable cultural issue at LANL in the middle and senior management that encourages a nearly pathological disrespect for authority, which gets conveyed to the more junior staff. Break the rules even when they make sense. "
Oh Jesus, you gave yourself away to easily with this. There is absolutely no evidence for this, none, and you dam well know it. You have some very dull ax to grind with LANL and UC which is obviously very personal with you. You refuse to provide evidence, you ignore arguments, you lie, deny, conceal, avoid and above you will not and cannot listen to any form reason. You come across like a crazed maniacal religious zealot in your all consuming hatred which has obviously blinded you. When it comes to something being pathological, well you have that one down cold. You are one seriously messed up person, I mean seriously. I think you already know how sick you are but you just don't care anymore and will be happy to sit your personal cesspool of filth and pollute the world with spewing bile.
8:37 has not a clue. The mismanagement at LANL runs deep. You cannot fix it by scapegoating innocents, paying high salaries to Bechtel cronies, or with super VUCA mission statements.
Well 10:20 pm just proved 8:37 pm's point. There are some really strange people working at LANL.
May 16, 2016 at 10:55 PM
How is that?, 10:20 pm did not have any particular point and certainly had no data to back any of it up. 10:20 pm did not have show any pathological disrespect for authority but simply pointed out that 8:37 pm has an obvious agenda against LANL. In anything 8:37 pm's utterly irrational hate towards LANL is what is strange an certainly pathological.
"LANL and LLNL operated under dramatically different conditions in that era. They had a clear mission, focused on direct support of UGT. They had nearly unlimited budgets, and very limited oversight from the Feds. Their mission had national importance to both the uniformed military and Congress. The country had Rocky Flats as a production facility.
Under these circumstances, UC operated both locations.
Today there are drastically different conditions.
Any "conclusion" based on conditions that no longer exist is indeed unfounded in the extreme.
May 16, 2016 at 3:09 PM"
This could be a valid point however it is not clear that some of conditions that existed previously actually existed as you claim and some of the other conditions that claim no longer exist can be argued to still exist. If so than one could still reasonably infer that it was the for profit LLC model that failed and not UC. Also you keep saying it is the "LLC" model and that other DOE labs are LLC models, however there is a clear distinction between a for profit LLC and and a service oriented LLC, a distinction you seem to keep deliberating ignoring.
Pattiz is the Chairman of the Board for LLNS-LANS. While he probably is a nice guy, and a successful media / entertainment executive, he hasn't shown himself to be much of an asset to the laboratories. He picked Charlie for LANL Director, over the strong objections of DoE, and everyone can see how that has worked out. He fired Parney as LLNL Director for making the right call on Moses, and meddled where he was not needed.
This could be a valid point however it is not clear that some of conditions that existed previously actually existed as you claim and some of the other conditions that claim no longer exist can be argued to still exist.
May 17, 2016 at 5:57 AM
If you want to be taken seriously, be specific and provide data and references to support your claims.
Yes UC could have "hired" Bechtel as a subcontractor, but UC as a state entity trying to pass on to them potentially half of the LANS fee would not have worked. Read UC's whitepaper on the contracts and their reasons for the specific LLC model.
No one cares if you take them seriously, 6:29 am. This is a blog, not a technical journal, where humans talk like humans. You know, those two-legged things that walk around and interrupt your math problems.
How, 8:37 pm sounds like an incoherent rant with sweeping generalizations and speculation. That is not the usual definition of "getting it" if you get what I mean.
Hate Bechtel, love UC. Hate LLCs, love UC. Hate UC, love Bechtel. UC has failed. The LLC model has failed. And I can prove it! Look, if you add up all my unsupported opinions, you obviously have to come to my unfounded conclusion! What's wrong with you people??? Make LANL Great Again!!
Excuse me but what where the specifics, data and references to support your initial claims? It goes both ways.
May 17, 2016 at 7:43 AM
All interested followers of the health of the National Laboratories should have ample references easily at hand, and most of them have had numerous threads on this blog.
Rocky Flats is historical fact, and the other claims from whoever made the earlier post are very well documented in any number of the studies on the National Laboratories in the past decade.
UC was a good steward for the lab workers that accomplished heroic efforts to win the Cold War, but those were different times, and in life there is not much that remains stagnant for 60 years.
The point that science is dead at LANL is certainly supportable. Read the science that is touted in the yearly report on LANL and then check out how many of the founders of those research areas at LANL are still working there. The best scientists have pretty much all left. Sure some of them retired or went on change of station or whatever but the truth is they would have stayed if they hadn't been harassed and punished for being tops in their fields.
The problem is that even though LANS gets a percentage of WFO regardless of their poor performance, they hate science and WFO because they consider it a financial risk. Putting any old thing in a WIPP barrel is good work because it is guaranteed to pay for years. You even get paid for cleaning up the messes you make.
How much does the average NIF shot cost, and what percentage of NIF shots are declared procedural failures (forgot to turn on/off equipment X, left hardware in shot chamber, etc.)? Are these human failures folded into the annual LLNS evaluations?
DOE/NNSA also hates WFO, always have. Other agencies freeloading and competing for pre-existing infrastructure and sometimes causing unplanned hiring of people who will have to be RIF'ed once the WFO program ends (and they all do.)
UC was a good steward for the lab workers that accomplished heroic efforts to win the Cold War, but those were different times, and in life there is not much that remains stagnant for 60 years.
May 17, 2016 at 9:45 AM
I am not sure what you point is, but another way to look at it is that during the cold war people thought the labs where important enough and that the risks where high enough that they should be managed well and run well. After the cold war it was thought that they the labs could be compromised for short term political gain and corporate profit since the lab mission was not as vital as before. Of course this is playing Russian roulette however nut after the cold war the odds seem good enough that loss of lab capabilities and excellence for short term profit was worth the risks. This of course could end very very badly and history has shown how often such thinking works out.
Just look at it this this way, during the cold war it would be considered utter madness and recklessness to let a for profit LLC run the labs. The same actually holds true today but perception of risk is not deen as high enough to have the labs run well, hence what we have today. There is no, UC is bad, no cowboy scientists, no pathological LANL staff, it is simply about corporations getting more money at the expense of our safety and security.
You might come off as a little more respectable of you proofread before you posted. Your grammatical, spelling, and simple typo errors indicate that you don't really care how your posts look; why should anyone else care about them? Education shows and is respected. Pretension to education also shows.
If you want to play the spelling and grammar aficionado, at least apply it to yourself as well.
May 18, 2016 at 8:21 AM
To hell you all, I hate LANL and you should too, cowboys, arrogance, culture and any other dam thing. I am sick you people pretending that everything is an equation, its not and never will be, it is also about feelings and my feeling count as much as yours if not more so. LANL is a cesspool full of pathological people, every last one of them, Bechtel could fight and win war in Iraq and rebuild the place at the same time yet the crazies filled with arrogance of LANL are too much for even them to overcome. Unbelievable, am I the only one who can see the obvious..? Just in the latest Santa Feian it says how LANL will get more money, my God the world has gone insane, insane I tell, you the cowboy culture of arrogance has now infested even the nether regions of the Universe itself. LANL cowboys, imprisoning me, all that I see, absolute horror. Some say that maybe LANL is not to blame for my problems, that there are no cowboys at LANL and there never was any cowboys. If that is true than maybe I have have some kind of personal issues as implied by the rabble on this blog, but I refuse to accept that, I cannot and will not accept that, the problems in my life are due to LANL and LANL alone and no amount or reason, facts, or knowledge will sway me of this ever, ever I tell you.
the problems in my life are due to LANL and LANL alone and no amount or reason, facts, or knowledge will sway me of this ever, ever I tell you.
May 18, 2016 at 8:54 PM
No, the problems in your life are yours and yours alone, and no one will ever deal with them but you. And obviously, that will never happen since you are a "victim." As long as you see yourself as such, you cannot accept personal responsibility for your life, as every child should be taught by age 10. You never learned it. Blame your parents, and maybe your teachers, since you seem to be a product of the failed education system in the US.
Personally, I just wish you would seek help, because you are obviously clinically insane, but I more fervently wish you would just stop posting here, since you must know that as much as you hate LANL, everyone on this blog hates you. Go away.
64 comments:
SNL is not an LLC, and LLC model has also failed at LLNL. From this it seems like a LLC model it does not work well for a scientific laboratory. All the other DOE science labs, like ANL, ORNL,
Fermi Lab and so on are not LLCs. It seems to work for plants or clean up jobs but not science labs.
Actually most of these are LLCs. Here are the DOE Lab and their operators from from the official list of FFRDC at http://www.nsf.gov/statistics/ffrdclist/
Ames Laboratory
Administrator: Iowa State University
Argonne National Laboratory
Administrator: UChicago Argonne, LLC
Brookhaven National Laboratory
Administrator: Brookhaven Science Associates, LLC
Fermi National Accelerator Laboratory
Administrator: Fermi Research Alliance, LLC
Idaho National Laboratory
Administrator: Battelle Energy Alliance, LLC
Lawrence Berkeley National Laboratory
Administrator: University of California
Lawrence Livermore National Laboratory
Administrator: Lawrence Livermore National Security, LLC
Los Alamos National Laboratory
Administrator: Los Alamos National Security, LLC
National Renewable Energy Laboratory
Administrator: Alliance for Sustainable Energy, LLC
Oak Ridge National Laboratory
Administrator: UT-Battelle, LLC
Pacific Northwest National Laboratory
Administrator: Battelle Memorial Institute
Princeton Plasma Physics Laboratory
Administrator: Princeton University
Sandia National Laboratories
Administrator: Sandia Corporation, a subsidiary of Lockheed Martin Corp.
Savannah River National Laboratory
Administrator: Savannah River Nuclear Solutions, LLC
SLAC National Accelerator Laboratory
Administrator: Stanford University
Thomas Jefferson National Accelerator Facility
Administrator: Jefferson Science Associates, LLC
While I can't speak to LANL's needs, after 25 years at LLNL in the operations side of things, the LLC model could work if the industrial partners were ditched. I really would like to see either a solely UC owned LLC like the ANL model or a UC-Battelle LLC like ORNL.
The industrial partners in LLNS have added zero value to LLNL operations, everything they do is for show no substance. Look at the turn over in top managers for ES&H, O&B, HR, Assurances, etc. The industrial partners brought in someone from another DOE site, that person screwed things up at LLNL and then leaves... turning the mess over to a long time LLNL employee to become manager and clean things up.
Why didn't the LLC model work?
"Follow the money, follow the money…."
Charlie McMillan, LANS President, LANL Director
Actually most of these are LLCs. Here are the DOE Lab and their operators from from the official list of FFRDC at http://www.nsf.gov/statistics/ffrdclist/
The key difference is if the LLC "for profit" or for service, LLNS and LANS are "for profit:
None of the below are "for profit".
Ames Laboratory
Administrator: Iowa State University
Argonne National Laboratory
Administrator: UChicago Argonne, LLC
Brookhaven National Laboratory
Administrator: Brookhaven Science Associates, LLC
Fermi National Accelerator Laboratory
Administrator: Fermi Research Alliance, LLC
Idaho National Laboratory
Administrator: Battelle Energy Alliance, LLC
National Renewable Energy Laboratory
Administrator: Alliance for Sustainable Energy, LLC
Oak Ridge National Laboratory
Administrator: UT-Battelle, LLC
Thomas Jefferson National Accelerator Facility
Administrator: Jefferson Science Associates, LLC
In fact
Sandia National Laboratories
Administrator: Sandia Corporation, a subsidiary of Lockheed Martin Corp. Is not realy for profit either from what I can tell.
All of the LLCs are "for profit" in the sense that they hope to generate significant income from fees, which are shared among the partners. Otherwise there is absolutely no reason for a company like Bechtel to participate in a LLC. Same with SNL, Sandia Corp. is a subsidiary of Lockheed, which probably owns 100% of the stock and gets income from the fees. It's all about fees, which is a key difference from the old UC-managed LLNL and LANL.
It's all about fees, which is a key difference from the old UC-managed LLNL and LANL.
May 14, 2016 at 11:15 PM
and the old AT&T managed Sandia (for $1/yr)
It has become sort of an urban legend that NNSA "required" for-profit companies to bid on the LANL and LLNL contracts. The RFPs for these contracts contained no such requirement, NNSA only required that any bidder for the contracts be organized as a distinct, special-purpose legal entity dedicated exclusively to the performance of the contract. UC choose the LLC model because it allowed a public institution (UC) to directly share the huge contract fees with the industrial partners it felt it needed in order to win the contract competitions.
The fee earned by LANS and LLNS is distributed to the four members of the LLCs, after deducting costs of certain key personnel compensation supplements and certain other non-reimbursable costs. Slightly different fee distribution formulas are used at LANL and LLNL, as set forth in each LLC agreement:
At LLNL the net income of LLNS, consisting of the earned fee as reduced by deduction of all non-reimbursable costs, is allocated to the four members of LLNS according to a negotiated, fixed formula.
At LANL the earned fee and any non-reimbursable costs are allocated separately to the members of LANS, according to somewhat different negotiated formulas.
LANS and LLNS as LLCs, are taxed as partnerships for federal income tax purposes. This means the LLCs themselves do not pay federal income taxes, because they are treated as “pass-through entities,” and the members pay income tax only on their shares of the fees, in accordance with their particular tax circumstances. UC, as a nonprofit public research university, pays no federal income tax on its fee share and dedicates its net fee share to research and other purposes consistent with this status. The corporate partners, as for-profit organizations, are subject to income tax on their share of the net income distributed to them. This accommodation of the distinct tax statuses of UC and its partners is the primary reason UC went with the LLC structure for the partnerships.
From this it seems like a LLC model it does not work well for a scientific laboratory. All the other DOE science labs, like ANL, ORNL,
Fermi Lab and so on are not LLCs. It seems to work for plants or clean up jobs but not science labs.
May 14, 2016 at 7:54 AM
7:54 AM is typical of the LANL view of the outside world. It is full of wrong statements, spouted out as facts. When faced with the truth, in typical LANL fashion, they draw conclusions based on their incorrect views, and stick with it even after it is shown to be wrong.
In fact, most of the DOE science Labs do operate as LLCs, including the specific ones claimed by 7:45 AM to be otherwise.
There is nothing wrong with the LLC concept for a Lab; however, in order to work at LANL it will require a different parent company in the lead. UC has shown itself incapable of functioning under the LLC structure.
UC has shown itself incapable of functioning under the LLC structure.
May 15, 2016 at 10:23 AM
Speaking of "wrong statements, spouted out as facts"... Evidence, please (facts, not opinions).
Bull! Domenici wanted private business because "business does everything better." The contract change was absolutely to change a not-for-profit to a for-profit. The state and local governments had been after the tax money, too. The LLC model does not work because of Bechtel and their profit driven management. They are a private company very adept at wringing huge profits out of governments it holds hostage. The LLC model works at labs that have Battelle or University consortiums running them.
The for-profit change killed about 400 jobs at LANL and a comparable number at LLNL. It costs a lot more than money and it has destroyed science at both labs.
"7:54 AM is typical of the LANL view of the outside world. It is full of wrong statements, spouted out as facts. When faced with the truth, in typical LANL fashion, they draw conclusions based on their incorrect views, and stick with it even after it is shown to be wrong."
It was pointed out to you very clearly that the LLC models for LLNL and LANL are FOR PROFIT,
and most of the others are not. This is not a LANL view of the outside world it is a FACT and points to the for profit model not working not the LLC model.
"In fact, most of the DOE science Labs do operate as LLCs, including the specific ones claimed by 7:45 AM to be otherwise."
Again most of these are not "FOR PROFIT". This is is not hard to understand and I think even you understand this distinction and why it just might might make all the difference.
"There is nothing wrong with the LLC concept for a Lab; however, in order to work at LANL it will require a different parent company in the lead. UC has shown itself incapable of functioning under the LLC structure."
A non-profit might work better. We have run the for profit model experiment and it has faild
in both cases of the a science lab, LLNL, and LANL. It does not follow that UC has faild, it could be that UC-Bechtel "for profit model" has failed but not UC. In fact UC seemed to work
great for 60 years which implies that the UC non-profit model works. This is not rocket science and yes even a reader such as you can follow the logic.
If you follow the screeds in the last few posts, it is clear that the posters are Bechtel-hating, bitter folks.
If you follow the screeds in the last few posts, it is clear that the posters are Bechtel-hating, bitter folks.
May 15, 2016 at 12:27 PM
If you follow the screeds in the last few posts, it is clear that the posters are UC-hating, bitter folks.
If anyone has interest in understanding UC's official view on the LLCs, UCOP wrote an introductory guide on UC’s involvement in LANS LLC and LLNS LLC back in 2007 that is at:
http://senate.universityofcalifornia.edu/reports/ac.labguide.0807.pdf
UC has shown itself incapable of functioning under the LLC structure.
May 15, 2016 at 10:23 AM
Speaking of "wrong statements, spouted out as facts"... Evidence, please (facts, not opinions).
May 15, 2016 at 11:08 AM
Name a single lab operating LLC that UC is part of that functions well.
"Name a single lab operating LLC that UC is part of that functions well.
May 15, 2016 at 1:32 PM"
This is hardly an argument. UC ran LBL, LLNL and LANL just fine for 60 years, now it runs LLNL and LANL with a for profit LLC leading to failure in both cases. What are the possible conclusions? (1) The for profit model LLC does not work for a science lab no matter who runs it (most likely given the evidence at hand). (2) UC could run with a non-for profit LLC model and it could work well.
A much better question to ask is "Name a single science lab operating under a for profit LLC that functions well." Once you have this answered everything will be clear for you. Again this is not rocket science and it not that hard to figure out, so are you really that confused or will just stick to your "I hate UC" no matter what the evidence stance?
It is clear that the anti-Bechtel crowd is out in full force today.
It is clear that the anti-Bechtel crowd is out in full force today.
May 15, 2016 at 6:07 PM
It is clear that the anti-UC crowd is out in full force today.
It is clear that the anti-Bechtel crowd is out in full force today.
May 15, 2016 at 6:07 PM
That is your only response? You having a rather bad day, perhaps it would be better to consider actual facts and statistics and try to address the points raised.
Oh here comes the LANL sociopath again, interacting with everyone like a professor with IBS biting the heads off his students.
Still no evidence that UC has screwed anything up as part of the LLC's. Bechtel, well that is evident to everyone.
Name a single lab operating LLC that UC is part of that functions well.
May 15, 2016 at 1:32 PM
LBL. Now go back to being a Bechtel cheerleader.
"Oh here comes the LANL sociopath again, interacting with everyone like a professor with IBS biting the heads off his students.
May 15, 2016 at 9:26 PM"
One person is trying to use logic and you are calling them a sociopath? It would seem that you are the one with mental issues.
Name a single lab operating LLC that UC is part of that functions well.
May 15, 2016 at 1:32 PM
LBL. Now go back to being a Bechtel cheerleader.
May 16, 2016 at 5:37 AM
Wrong.
LBL is not managed by an LLC contractor. Please, try to keep up here.
LBL is not managed by an LLC contractor. Please, try to keep up here.
May 16, 2016 at 7:04 AM
However LBL is doing much better than LLNL and LANL which which is evidence that for profit LLC models do not work for science labs and that UC can successfully run a science lab.
UC may be able to operate a lab such as LBL that is an extension of a world-class university campus. Not so clear that UC can operate a location that builds components for nuclear weapons.
LANL and LBL have little in common. What works for one doesn't have much to do with the other.
Bechtel, well that is evident to everyone.
May 15, 2016 at 9:54 PM
In your mind, maybe this is evident; however, not so to others.
LLNL was technically a division of LBNL until the early 1970s. There are still pretty strong operational and business ties between the two labs.
LANL and LBL have little in common. What works for one doesn't have much to do with the other.
May 16, 2016 at 12:39 PM
Perhaps, but than again UC alone worked fine for LANL and LLNL for 60 years, so we have a couple of examples where it has worked. We now have two examples of where a for profit LLC has not worked. I think the conclusion is clear.
Superficial comparisons and statistics do not address underlying causes or unknown parameters. Any "conclusion" based on them would be unfounded in the extreme. As they say, life is a little more complicated than that.
Mr. "UC worked for 60 years" is back.
LANL and LLNL operated under dramatically different conditions in that era. They had a clear mission, focused on direct support of UGT. They had nearly unlimited budgets, and very limited oversight from the Feds. Their mission had national importance to both the uniformed military and Congress. The country had Rocky Flats as a production facility.
Under these circumstances, UC operated both locations.
Today there are drastically different conditions.
Any "conclusion" based on conditions that no longer exist is indeed unfounded in the extreme.
Superficial comparisons and statistics do not address underlying causes or unknown parameters. Any "conclusion" based on them would be unfounded in the extreme. As they say, life is a little more complicated than that.
May 16, 2016 at 2:33 PM
Than how can you keep saying UC is so bad than? You cannot have it both ways.
LANS failed. UC was in charge of LANS. Ergo, UC failed.
LANS failed. UC was in charge of LANS. Ergo, UC failed.
May 16, 2016 at 5:28 PM
Well UC did not fail for 60 years. You can say UC failed when forced to partner with Bechtel, but history shows that UC alone ran the labs well during the time when it was most important. This would lead one to believe that adding Bechtel to the mix was the key to failure not UC.
The idea that the llc model is the problem is not supported by any facts. For the poster who claims "science is dead" at LLNL and LANL , there is a lot of evidence to the contrary. For the posters comparing lbl to LLNL and LANL , the obvious difference isn't the contract structure but who they work for: lbl works for doe/sc and LANL and LLNL work for NNSA. The mission of anl, lbl, bnl, ORNL is science for its own sake. The mission of SNL, LLNL , and LANL is national security. Very different missions, and very different management philosophies on the DOE side. There is a palpable cultural issue at LANL in the middle and senior management that encourages a nearly pathological disrespect for authority, which gets conveyed to the more junior staff. Break the rules even when they make sense. That does not exist at LLNL or SNL. Bechtel is really a sideshow, and we will see a divorce soon between them and UC in the LANL recompete, which I predict UC will lose. At LLNL bechtel is not very relevant except that they pay Gioconda's salary, and I challenge anyone to argue he doesn't do a good job. Lockheed really doesn't male much of a difference at SNL either. The structure of the contract doesn't matter very much, and the fees even today are not very large. What has made a significant difference is the relationship LANL and LLNL has with UC. Before, they reported the the President of UC, and we're treated as if they ran a campus. Now, they report to a clownish regent. That part has made a difference at both labs, mainly for the bad.
Than how can you keep saying UC is so bad than? You cannot have it both ways.
May 16, 2016 at 4:09 PM
I didn't say that. That was some other jerk. I just said that no reasonable or rationally supported conclusion can be made based on the "data" being promulgated on this thread. The situation is more complicated than that. If you aren't willing or able to do more research into the situation, you will be unable to support any conclusion by logic or by facts.
To the poster who claims that UC did the llc for tax reasons, that is false and also doesn't make sense. They did it because they wanted shared risk. Otherwise they could have just hired Bechtel and the others as subcontractors.the poster who calims this was domenici is wrong. The push came from the House, and cong Hobson of Ohio.
Domenici had the clout to shut it down if he wanted to. Some unknown congressman would have had no say in it.
The idea that the llc model is the problem is not supported by any facts.
Where have you been in the last 10 years? Why do you think this blog and the LANL bogs existed? Do you we need to go through the list again? We did it already. The LLC "FOR PROFIT" model has been a failure, even NNSA, Vic Reis, and DOE say so, there is no denying it now.
"There is a palpable cultural issue at LANL in the middle and senior management that encourages a nearly pathological disrespect for authority, which gets conveyed to the more junior staff. Break the rules even when they make sense. "
Oh Jesus, you gave yourself away to easily with this. There is absolutely no evidence for this, none, and you dam well know it. You have some very dull ax to grind with LANL and UC which is obviously very personal with you. You refuse to provide evidence, you ignore arguments, you lie, deny, conceal, avoid and above you will not and cannot listen to any form reason. You come across like a crazed maniacal religious zealot in your all consuming hatred which has obviously blinded you. When it comes to something being pathological, well you have that one down cold. You are one seriously messed up person, I mean seriously. I think you already know how sick you are but you just don't care anymore and will be happy to sit your personal cesspool of filth and pollute the world with spewing bile.
Well 10:20 pm just proved 8:37 pm's point. There are some really strange people working at LANL.
8:37 has not a clue. The mismanagement at LANL runs deep. You cannot fix it by scapegoating innocents, paying high salaries to Bechtel cronies, or with super VUCA mission statements.
Well 10:20 pm just proved 8:37 pm's point. There are some really strange people working at LANL.
May 16, 2016 at 10:55 PM
How is that?, 10:20 pm did not have any particular point and certainly had no data to back any of it up. 10:20 pm did not have show any pathological disrespect for authority but simply pointed out that 8:37 pm has an obvious agenda against LANL. In anything 8:37 pm's utterly irrational hate towards LANL is what is strange an certainly pathological.
"LANL and LLNL operated under dramatically different conditions in that era. They had a clear mission, focused on direct support of UGT. They had nearly unlimited budgets, and very limited oversight from the Feds. Their mission had national importance to both the uniformed military and Congress. The country had Rocky Flats as a production facility.
Under these circumstances, UC operated both locations.
Today there are drastically different conditions.
Any "conclusion" based on conditions that no longer exist is indeed unfounded in the extreme.
May 16, 2016 at 3:09 PM"
This could be a valid point however it is not clear that some of conditions that existed previously actually existed as you claim and some of the other conditions that claim no longer exist can be argued to still exist. If so than one could still reasonably infer that it was the for profit LLC model that failed and not UC. Also you keep saying it is the "LLC" model and that other DOE labs are LLC models, however there is a clear distinction between a for profit LLC and and a service oriented LLC, a distinction you seem to keep deliberating ignoring.
8:37 PM gets it.
Pattiz is the Chairman of the Board for LLNS-LANS. While he probably is a nice guy, and a successful media / entertainment executive, he hasn't shown himself to be much of an asset to the laboratories. He picked Charlie for LANL Director, over the strong objections of DoE, and everyone can see how that has worked out. He fired Parney as LLNL Director for making the right call on Moses, and meddled where he was not needed.
This could be a valid point however it is not clear that some of conditions that existed previously actually existed as you claim and some of the other conditions that claim no longer exist can be argued to still exist.
May 17, 2016 at 5:57 AM
If you want to be taken seriously, be specific and provide data and references to support your claims.
May 16, 2016 at 8:43 PM
Yes UC could have "hired" Bechtel as a subcontractor, but UC as a state entity trying to pass on to them potentially half of the LANS fee would not have worked. Read UC's whitepaper on the contracts and their reasons for the specific LLC model.
http://senate.universityofcalifornia.edu/reports/ac.labguide.0807.pdf
No one cares if you take them seriously, 6:29 am. This is a blog, not a technical journal, where humans talk like humans. You know, those two-legged things that walk around and interrupt your math problems.
If you want to be taken seriously, be specific and provide data and references to support your claims.
May 17, 2016 at 6:29 AM
Excuse me but what where the specifics, data and references to support your initial claims? It goes both ways.
8:37 PM gets it.
How, 8:37 pm sounds like an incoherent rant with sweeping generalizations and speculation. That is not the usual definition of "getting it" if you get what I mean.
Hate Bechtel, love UC. Hate LLCs, love UC. Hate UC, love Bechtel. UC has failed. The LLC model has failed. And I can prove it! Look, if you add up all my unsupported opinions, you obviously have to come to my unfounded conclusion! What's wrong with you people??? Make LANL Great Again!!
Excuse me but what where the specifics, data and references to support your initial claims? It goes both ways.
May 17, 2016 at 7:43 AM
All interested followers of the health of the National Laboratories should have ample references easily at hand, and most of them have had numerous threads on this blog.
Rocky Flats is historical fact, and the other claims from whoever made the earlier post are very well documented in any number of the studies on the National Laboratories in the past decade.
UC was a good steward for the lab workers that accomplished heroic efforts to win the Cold War, but those were different times, and in life there is not much that remains stagnant for 60 years.
The point that science is dead at LANL is certainly supportable. Read the science that is touted in the yearly report on LANL and then check out how many of the founders of those research areas at LANL are still working there. The best scientists have pretty much all left. Sure some of them retired or went on change of station or whatever but the truth is they would have stayed if they hadn't been harassed and punished for being tops in their fields.
The problem is that even though LANS gets a percentage of WFO regardless of their poor performance, they hate science and WFO because they consider it a financial risk. Putting any old thing in a WIPP barrel is good work because it is guaranteed to pay for years. You even get paid for cleaning up the messes you make.
How much does the average NIF shot cost, and what percentage of NIF shots are declared procedural failures (forgot to turn on/off equipment X, left hardware in shot chamber, etc.)? Are these human failures folded into the annual LLNS evaluations?
May 17, 2016 at 12:05 PM
DOE/NNSA also hates WFO, always have. Other agencies freeloading and competing for pre-existing infrastructure and sometimes causing unplanned hiring of people who will have to be RIF'ed once the WFO program ends (and they all do.)
UC was a good steward for the lab workers that accomplished heroic efforts to win the Cold War, but those were different times, and in life there is not much that remains stagnant for 60 years.
May 17, 2016 at 9:45 AM
I am not sure what you point is, but another way to look at it is that during the cold war people thought the labs where important enough and that the risks where high enough that they should be managed well and run well. After the cold war it was thought that they the labs could be compromised for short term political gain and corporate profit since the lab mission was not as vital as before. Of course this is playing Russian roulette however nut after the cold war the odds seem good enough that loss of lab capabilities and excellence for short term profit was worth the risks. This of course could end very very badly and history has shown how often such thinking works out.
Just look at it this this way, during the cold war it would be considered utter madness and recklessness to let a for profit LLC run the labs. The same actually holds true today but perception of risk is not deen as high enough to have the labs run well, hence what we have today. There is no, UC is bad, no cowboy scientists, no pathological LANL staff, it is simply about corporations getting more money at the expense of our safety and security.
May 17, 2016 at 7:53 PM
You might come off as a little more respectable of you proofread before you posted. Your grammatical, spelling, and simple typo errors indicate that you don't really care how your posts look; why should anyone else care about them? Education shows and is respected. Pretension to education also shows.
Pretension to education also shows.
May 17, 2016 at 9:04 PM
Yes. Indeed it does.
You might come off as a little more respectable of you proofread before you posted.
May 17, 2016 at 9:04 PM
If you want to play the spelling and grammar aficionado, at least apply it to yourself as well.
If you want to play the spelling and grammar aficionado, at least apply it to yourself as well.
May 18, 2016 at 8:21 AM
To hell you all, I hate LANL and you should too, cowboys, arrogance, culture and any other dam thing. I am sick you people pretending that everything is an equation, its not and never will be, it is also about feelings and my feeling count as much as yours if not more so. LANL is a cesspool full of pathological people, every last one of them, Bechtel could fight and win war in Iraq and rebuild the place at the same time yet the crazies filled with arrogance of LANL are too much for even them to overcome. Unbelievable, am I the only one who can see the obvious..? Just in the latest Santa Feian it says how LANL will get more money, my God the world has gone insane, insane I tell, you the cowboy culture of arrogance has now infested even the nether regions of the Universe itself. LANL cowboys, imprisoning me, all that I see, absolute horror. Some say that maybe LANL is not to blame for my problems, that there are no cowboys at LANL and there never was any cowboys. If that is true than maybe I have have some kind of personal issues as implied by the rabble on this blog, but I refuse to accept that, I cannot and will not accept that, the problems in my life are due to LANL and LANL alone and no amount or reason, facts, or knowledge will sway me of this ever, ever I tell you.
the problems in my life are due to LANL and LANL alone and no amount or reason, facts, or knowledge will sway me of this ever, ever I tell you.
May 18, 2016 at 8:54 PM
No, the problems in your life are yours and yours alone, and no one will ever deal with them but you. And obviously, that will never happen since you are a "victim." As long as you see yourself as such, you cannot accept personal responsibility for your life, as every child should be taught by age 10. You never learned it. Blame your parents, and maybe your teachers, since you seem to be a product of the failed education system in the US.
Personally, I just wish you would seek help, because you are obviously clinically insane, but I more fervently wish you would just stop posting here, since you must know that as much as you hate LANL, everyone on this blog hates you. Go away.
I am sick you people....
May 18, 2016 at 8:54 PM
You made another typo, cretin. You really should proofread your posts, I just stopped reading when I hit this one.
Maybe it wasn't a typo but an admission.
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