HENDERSON, Nev. — The U.S. Energy Department’s Office of Environmental Management and the vendors that provide it with nuclear remediation services are reasonably satisfied with the “end state” approach to contracting — although some lingering issues remain.
That was the message shared Tuesday by the No. 2 official at the nuclear cleanup office, Todd Shrader, along with an agency procurement director and the executive vice president of a cleanup contractor, at the ExchangeMonitor’s annual RadWaste Summit.
The contracting philosophy, rolled out in 2018, is a move away from the more cost-based approach to contracting and toward greater reliance on single-award, indefinite delivery/indefinite quantity (IDIQ) awards.
The end-state model, launched in 2018 during the tenure of former Assistant DOE Secretary for Environmental Management Anne Marie White, is designed to provide the department with more flexibility to work with “partner” contractors to accelerate remediation. The agency can offer fees of up to 15% for top performers, as opposed to single-digit amounts currently.
As end-state contracts evolve, the Energy Department is abandoning its approach of drawing up task orders and cost estimates years in advance of a solicitation, and some work plans will be hashed out after a contractor is selected.
“End states is a bit of a misnomer,” said Shrader, DOE principal deputy assistant secretary for environmental management. It does not necessarily mean a job is complete, but rather that significant defined progress is being made toward final remediation under a given contract.
The Office of Environmental Management’s job is not “an enduring mission,” Shrader said. “EM’s job is to clean it up” and prepare land for other uses – from a business park to a wildlife refuge. Hopefully, the map of DOE EM projects 10 years from now won’t show the same 16 Cold War and Manhattan Project sites currently undergoing remediation, he added.
New indefinite-delivery/indefinite-quantity contracts are awarded based on experience, key personnel, and plans for very specific tasks during the early going, said Tamara Miles, procurement director for the department’s Cincinnati-based Environmental Management Consolidated Business Center.
After the initial award, under a payment guarantee as low as $500,000, the Energy Department and its selected vendor use the 60-day transition period to agree upon work plans for up to 10 years of task orders, Miles said. This new approach is being pursued for new contracts at the Hanford Site in Washington state and the Nevada National Security Site, along with future awards for the Idaho National Laboratory and the West Valley Project in New York state.
If DOE and the winning vendor cannot agree on reasonable prices and performance, the new procurement model offers an “off ramp” with no termination liability for the agency after the minimum guaranteed number of task orders is satisfied, Miles said.
The end-state model enables DOE to first select a partner and then “openly negotiate” milestones toward completion of the contract, Miles said.
The “jury is still out” on the second step of the process, said Cathy Hickey, executive vice president for Navarro Research and Engineering. Energy Department contractors tend to believe a 60-day window is insufficient to hammer out the bulk of a 10-year business agreement that could amount to billions of dollars, she added. Look for the Energy Department to expand the transition phase from 60 days to 90 or 120 days in future solicitations, Miles said.
Hickey based her presentation on a study done by the Energy, Technology, and Environmental Business Association (ETEBA). The organization provided a “blind” survey to its members and received 29 responses, nine from large businesses and 20 from smaller firms. The ETEBA members were asked about what they did and did not like about the new approach to procurement.
More than half of the respondents participated in requests for proposals for one of the various Hanford contracts, which suggests the companies have some familiarity with the end-state approach.
In addition, many in the contracting community want “more pages” to explain why their approach to a project distinguishes them from their competitors, Hickey said. The end state model currently calls for a 25-page limit in most solicitations.
