Mike Nartker
WC Monitor
5/1/2015
Warning that the Department of Energy’s current contracting approaches are “increasingly insupportable,” local officials near DOE sites expressed concern this week over the Department’s procurement policies. “Our concern is that DOE is departing from the most successful contract mechanisms and past practices that cleaned up Rocky Flats, Fernald and the Hanford River Corridor,” Energy Communities Alliance Chairman and Aiken County, S.C., Councilmember Chuck Smith wrote in April 27 letter to acting DOE cleanup chief Mark Whitney. “Instead, the latest procurement approaches replace incentives structures with punitive liabilities. The results have discouraged competition and small business integration. Tier 1 engineering firms are reluctant if not openly avoiding the latest round of DOE procurements. Good contractors are key to good outcomes and we feel that DOE’s current approach is driving industry away.”
The ECA letter appears to be referencing DOE’s efforts to find a new cleanup contractor for the Department’s Idaho site. Initially, as many as four teams were believed to have formed to compete for the new Idaho Cleanup Project (ICP) Core contract. While the new Idaho contract represents one of the few major near-term business opportunities in the DOE cleanup program, there have been questions as to how many companies would choose to actually bid on the job since DOE issued an initial draft Request for Proposals that was met with concern from potential bidders. Nearly all potential bidders made it clear that they could not bid on the contract as outlined in the initial draft RFP 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. In apparent response, DOE made several changes to the planned contract, including modifications to the fee structure. As a result, it appears now that two teams are bidding for the work—one led by Fluor and one by AECOM.
Are Locals Being ‘Drowned Out’ in Contracting Decisions?
In its letter, the ECA also said it was concerned about an apparent lack of local input into DOE contracting decisions. “Historically communities have served as vital partners with the DOE field offices and contractors. Now DOE seems to be focusing instead on centralizing the process, relying on the influence of DOE-HQ and thus, is becoming increasingly deaf to local needs and site-specific issues. Instead of empowering field offices to be more involved, the latest procurements seem to decouple contract decisions from local knowledge, insight and sensitivity to community needs,” Smith wrote.
He went on to add, “Contracts do not appear to reflect the importance of contractors engaging with their host communities. The voice of the community, DOE Field Offices, and knowledgeable contractors seems to be drowned out. Short contract performance periods no longer line up with site-specific milestones or terminate just as die contractors finally come up to speed. Contract mechanisms no longer seem to align well with the scope of work being sought. ECA believes DOE has become overly risk-averse, loading contracts with risk and liabilities that discourage – rather than reward -innovation and creativity.” The DOE Office of Environmental Management did not respond to a request for comment on the ECA letter this week.
