Bechtel National (BNI) is under new federal restrictions on issuing subcontracts and making large purchases in the wake of a routine audit of its purchasing systems by the Pentagon’s Defense Contract Management Agency. On July 20, Bechtel issued an internal “Procurement & Subcontracts Compliance Bulletin” with the subject head “Disapproval of BNI Purchasing System” for its employees at the Hanford Site’s Waste Treatment Plant.
The bulletin said that without an approved purchasing system, Bechtel National is required to receive consent from the Department of Energy Office of River Protection contracting officer for key purchases at Hanford. Those include fixed-price agreements valued at $150,000 or more and all flexibly priced agreements, such as those in which expenses are reimbursed based on labor hours or costs.
“An audit this past February identified concerns with procedures for documenting purchases from subcontractors and notifying the government in a timely way, among others,” said Bechtel spokesman Fred deSousa. “We completed the requested updates to our procedures in April, but there has been a delay in accumulating enough sample data to validate the changes to the government’s satisfaction.”
Bechtel National continues to add documentation to purchases and is working with the government to resolve validation concerns, deSousa said.
The audit covered all Bechtel National government subcontracting, including subcontracting at chemical weapons destruction sites in Colorado and Kentucky. Bechtel’s work at the Waste Treatment Plant appears to be the only DOE project affected by the disapproval of BNI purchasing systems, however.
Consolidated Nuclear Security – the management contractor for the Y-12 National Security Complex in Oak Ridge, Tenn., and the Pantex Plant in Amarillo, Texas — is led by Bechtel but does not use a Bechtel purchasing system. Bechtel National also holds a subcontract under Consolidated Nuclear Security for construction of the Uranium Processing Facility on the Y-12 grounds but has received no direction on restrictions to its subcontracting requirements there.
“We anticipate no detrimental impacts to ongoing work at the Waste Treatment Plant or any other project,” deSousa said.
