By Frank Munger, The Knoxville News-Sentinel, Tenn.
Sep. 28--OAK RIDGE -- The U.S. Department of Energy has approved a private financing plan for two major facilities at the Y-12 nuclear weapons plant, and groundbreaking is expected before year's end.

The government's contractor, BWXT Y-12, proposed the $100 million project using outside financing to speed modernization of the plant and, ultimately, save money. Instead of funding the capital project through the federal budget process, the buildings will be privately built and leased back to the Y-12 contractor on a year-to-year basis.

The project -- adding 500,000 square feet of office and lab space -- initially was scheduled to begin early this year, but it was delayed while the federal Office of Management and Budget and DOE reviewed the alternative financing.

Congressional committees still must review and approve the plan. Officials in Oak Ridge and Washington indicated that shouldn't be a problem, although the process could take up to 60 days.

"We're hopeful Congress will get a little proactive on this one," Y-12 general manager Dennis Ruddy said.

"We've found no reason to believe there would be any resistance from the part of Congress on it, and obviously the entire Tennessee delegation is behind it and understands it," Ruddy said.

BWXT has begun making preparations for the project, although construction won't start until there's a nod from Washington, he said.

If work begins before the end of the year, the project should be completed in the summer or fall of 2007, the Y-12 boss said.

The largest of the new buildings, the Production Interface Facility, will provide office space for about 1,200 to 1,400 employees at Y-12. It will become home to the plant's administrative and engineering staffs.

The other, smaller facility will be built at Y-12's entrance on Scarboro Road. It will serve as a visitor center with a museum and small auditorium. There also will be about 20,000 square feet of lab space there.

Ruddy said the new facilities will allow BWXT to relocate employees from more than 50 buildings at the site, and about 30 of those old buildings will be demolished -- saving money on maintenance and utilities.

When BWXT announced the plan last year, Lawler-Wood of Knoxville was named as developer, with Bank of America providing the financing. Turner Universal is the construction manager, with design by Susman Tisdale Gayle -- an architectural firm with offices in Nashville and Austin, Texas.

Ruddy said the project team is still intact.

The Y-12 project is modeled after a successful venture at Oak Ridge National Laboratory, where UT-Battelle used private financing for a three-building complex a couple of years ago.