Bids Due By May 12
Mike Nartker and Todd Jacobson
WC Monitor
3/20/2015
With the procurement for the new Idaho Cleanup Project (ICP) Core contract ramping up with the recent release of a final Request for Proposals, acting Department of Energy cleanup chief Mark Whitney said this week that he is “comfortable” with the expected level of competition for the contract. “I think today we would say we have a level of competition that we’re comfortable with, that gives the government and the taxpayer the best value,” Whitney told the House Energy and Water Appropriations Subcommittee. “With the release of the RFP … and the proposals anticipated within the next 60 days we hope the final RFP is structured in a way to encourage as much competition as possible,” he said, adding that “we think that is how you get value for the government, the more competition the better.”
The new ICP Core contract is intended to replace the two current cleanup contracts at the Idaho site that are currently set to expire in September—one held by CH2M-WG Idaho that is responsible for the bulk of the cleanup work at the site; and one held by Idaho Treatment Group, LLC, to manage the Advanced Mixed Waste Treatment Project. The contract represents one of the few major near-term business opportunities in the DOE cleanup program, and is anticipated to be worth approximately $1.5 billion over five years.
Currently, Fluor appears to be the most likely to lead a bid for the new Idaho contract, and is believed to have assembled a team that includes CH2M Hill. It remains to be seen which other, if any, DOE contractors also choose to pursue the job; Bechtel has reportedly suspended major work on a bid but is believed to have not entirely ruled out participating in the competition. Bids for the new contract are due by May 12, and DOE plans to hold a pre-proposal conference and site tour March 31-April 1.
EM Procurement Chief: ‘I Am Happy With How This Ended Up’
Initially, as many as four teams were believed to have formed to compete for the new contract, but after DOE issued an initial draft RFP last fall, nearly all potential bidders made it clear that they could not bid on the contract as then outlined because of concerns over provisions that would make the winning contractor liable for costs above the target cost combined with uncertainties in the work scope to be performed. Since then, DOE has made several changes to the planned fee structure for the new contract in response to industry concerns. “For the Idaho contract we had a lot of discussion and one of the reasons we engaged so much with industry when we came out with draft info on the proposed contract and then with the draft RFP in December was to get their feedback and so we spent a lot of time meeting with them, doing site tours, doing individual sessions, to try to understand what the contract terms would mean for that competition and we would have a level of competition,” Whitney said.
DOE has moved from an approach that largely kept all potential fee for the new Idaho contract from being final until the end of the job, to one that ties a “substantial portion” of fee to schedule milestones that if completed on time, becomes final and not subject to potential clawback, with some cost incentive fee still to be kept from being final until the end of the contract, according to Jack Surash, deputy assistant secretary for acquisition and project management in the DOE Office of Environmental Management. The final RFP contains “a fairly balanced incentive plan,” Surash said in remarks during this year’s Waste Management conference, held this week in Phoenix. “I await to see what the market response to that is.” Surash later said, ““I am happy with how this ended up.”
DOE May Publicly Release Number of Bidders Post-Award
Surash also said DOE may publicly announce how many proposals were ultimately received for the new Idaho contract after an award decision is made. “I typically don’t run around—because I’ve only got so many brain cells—trying to memorize how many proposals we got on different things,” he said. “If that’s useful, maybe I can consider that.”
