The current management and operations contract for the Los Alamos National Laboratory in New Mexico has been extended for one year, to fiscal 2018, but will be up for grabs after that.
Lab Director Charles McMillan made the announcement at an all-hands meeting on Wednesday, according to an internal announcement issued Thursday.
A formal notice from the National Nuclear Security Administration, the semiautonomous Department of Energy agency that oversees the nuclear weapons and national security research site, said it had “determined to grant Los Alamos National Security, LLC (LANS) a final Award Term for performance in Fiscal Year (FY) 2015, extending the period of performance through FY 2018. No further award terms are available under the contract; therefore, it will expire on Sept. 30, 2018.”
Los Alamos National Security – a consortium of Bechtel National, BWX Technologies, AECOM, and the University of California – has held the contract since 2006, before which the university was the sole facility manager. The base contract was for seven years, and the additional terms could have extended to 2026. It is worth over $2 billion annually, along with performance fees.
The facility over the years has dealt with a host of operational, safety, and security failures, which have proven persistent. The situation was highlighted by an improperly packed container of transuranic waste that was shipped from the lab to the Waste Isolation Pilot Plant in southeastern New Mexico, where it spewed open in February 2014. The incident closed the storage site, which DOE expects to reopen in December, and ultimately led to a $74 million settlement with the New Mexico government for violation of site permits and state environmental rules.
In the wake of the WIPP radiation release, the Department of Energy split off oversight of legacy waste cleanup at the laboratory from the NNSA to the DOE Office of Environmental Management, and in September 2015 announced plans to issue a new contract for that work. Los Alamos National Security for now remains in charge of waste produced by decades of operations – including deactivation and decommissioning of defense nuclear facilities, solid waste processing, and soil and water remediation — under a bridge contract that expires no later than Sept. 30, 2017, and is worth up to nearly $310 million.
The contractor received word late last year that its M&O deal would be up by Sept. 30 of this year, with the possibility of a one-year extension. At the time, McMillan acknowledged to LANL personnel that the lab’s performance rating for fiscal 2015 — while a significant improvement over the prior year — had not been strong enough to lock in a contract continuation.
Nevertheless, “NNSA offered to grant LANS an additional term in order to facilitate the environmental cleanup programmatic changes at LANL directed by the Secretary, an orderly transition to the contract the DOE EM is competing for legacy waste cleanup at LANL, and to allow NNSA to plan and re-compete the follow-on management and operations contract for LANL,” agency spokeswoman Francie Israeli said by email Thursday.
The National Nuclear Security Administration has not yet released its fiscal 2015 performance evaluations for its contractors, including Los Alamos National Security. The performance fees each contractor earned over their contracted levels also have not been made public. Fiscal 2015 ended on Sept. 30 of last year.
In the wake of the WIPP incident, LANS for fiscal 2014 earned a $6.2 million fee, less than 10 percent of the available $63.4 million.
The NNSA did not provide details regarding the upcoming procurement process, and a LANL spokesman did not respond to a request for comment.
Jay Coghlan, executive director of Nuclear Watch New Mexico, said the contract extension comes as no surprise given the time needed to put the next contract to bid. “However, I can’t help but view it as throwing good money after bad, given LANS miserable performance and the WIPP debacle,” he said by email Thursday. “Here’s hoping that the future bid competition leads to some true reform at LANL, but I cynically doubt it. The common thread throughout the decades of Los Alamos Lab mismanagement is the University of California.”
McMillan, who is also president and CEO of Los Alamos National Security, said in his memo that the laboratory’s internal website now features a contract transitions web page that will feature news updates, memorandums, and answers to frequently asked questions.
As with the management competition for the nearby Sandia National Laboratories, for which a final request for proposals is expected this month, major DOE contractors reached Thursday weren’t ready to say if they will take a shot at the Los Alamos spot.
