The National Nuclear Security Administration (NNSA) said Monday it expects this month to release the final request for proposals (RFP) for management and operation of the Sandia National Laboratories (SNL).
The agency has been seeking feedback on draft solicitation documents for the contract competition that it released in March. Last week, the NNSA offered a site tour of SNL and one-on-one meetings with potential bidders. A source familiar with industry attendees at the site visit said NNSA representatives indicated at that time that the final RFP would be released no later than the end of June. An agency spokesperson on Monday offered the tighter schedule.
Lockheed Martin subsidiary Sandia Corp. currently operates SNL, with an operating budget that has been valued at roughly $2.6 billion annually for the last few years. The contractor’s period of performance will expire on April 30, 2017, and the follow-on contract is expected to feature a four-month transition and five-year base period, along with options of up to five additional years.
The contest is still in the early stages, with NNSA preparing a draft request for proposals with input from potential applicants. Agency contract officers accepted access documentation by potential applicants, both large and small, before the cutoff date of April 20. Last week, the qualified participants attended a two-hour introductory briefing at Kirtland Air Force Base adjacent to SNL, followed by a tour of Sandia’s 13,000 acres of land and facilities in southeast Albuquerque. Questions were not allowed during the tour, although they could be written on a 3×5 card to be answered later, when many questions that have accumulated will be posted on a website.
The group included representatives of identifiable businesses, as well as a number of consultants who were possibly representing businesses that did not want to tip their hand now in that environment. One participant jotted down an unofficial list of attendees that included Boeing, Fluor, Booz Allen Hamilton, Battelle, Lockheed Martin, Innovative Technology Partnerships, Los Alamos Technical Associates, and BWX Technologies.
While Lockheed has indicated its intention to recompete for the bid, other potential players are keeping their cards close to their corporate vests.
“The Sandia contract is one of many that we are watching with interest as we evaluate our options for continued management and operations of DOE and NNSA sites,” Jud Simmons, spokesman for BWX Technologies, said by email on Wednesday. “We believe that a number of our core capabilities would be a good fit for the Sandia mission should we decide to engage in a proposal effort.”
Battelle is “considering options” but otherwise has no comment, spokeswoman Katy Delaney said on Tuesday. Bechtel is also studying the opportunity but has not determined whether it will participate, said spokesman Fred deSousa. Fluor spokeswoman Annika Toenniessen also said the company could not comment.
There was no immediate comment from major Department of Energy contractors Honeywell, AECOM, and CH2M.
Meanwhile, the majority of New Mexico’s delegation to Congress on Tuesday said they had called on the NNSA to ensure that small business participation is a key component of the next management and operations contract for Sandia.
In an April 27 letter to NNSA Administrator Frank Klotz, the four lawmakers thanked the agency for mandating small business involvement in the contract, noting that the laboratory spends 39 percent of contract-related funds in the state, with more than $258 million directed to New Mexico small businesses. “We request that NNSA evaluate the contractor on annually negotiated local contracting goals,” says the letter, signed by Democratic Sens. Martin Heinrich and Tom Udall and Reps. Ben Ray Lujan and Michelle Lujan Grisham.
“We need to make sure that the laboratories, Los Alamos and Sandia and really the NNSA labs writ large, are in functional ecosystems that support them effectively,” Heinrich said Thursday during a visit to Los Alamos. “That means we have to have strong relationships with local businesses that really are the support base for those institutions.”
The Congress members also cited four other areas that should be sustained or augmented in the request for proposals:
- Workforce recruitment and retention, including requiring “contractors to consider diversity and workforce retention when proposing any changes to compensation and benefits packages, and to be open to innovative benefits available in the private sector, such as paid family leave.” The contract should also not open the door for companies to “renege on obligations to employees,” and all labor union agreements should be sustained, the lawmakers said;
- Technology transfer, including evaluating the contractor substantively on transfer of lab-produced technology into the marketplace. That should encompass use of “laboratory generated technology by small and medium sized businesses and regional job creation and retention,” according to the letter.
- Promoting lab collaborations with universities in the region, with incentives in the RFP for bringing such institutions into the contractor leadership group; and
- Encouraging support for charitable contributions and STEM (science, technology, engineering, and mathematics) education.
“I think that in the chase for efficiency sometimes we make penny wise, pound foolish decisions,” Heinrich said, “and so that letter is an effort to move back in the right directions; and to make sure these things exist in the context of local communities and having these communities strong is in our security interest and in the interest of having strong and effective labs.”
The NNSA has not yet responded to the lawmakers’ letter.
The role of small businesses, as indicated by the N.M delegations concerns, was definitely a concern to participants in the contractor tour of the lab. One of them read the initial information as effectively requiring a large, extremely well-known entity to run SNL, although a junior partner of one of the larger current partnerships that can demonstrate relevant experience managing a lab might have a shot.
One person questioned the recommended ceiling of 1 percent on fixed fees and .5 percent on award fees and suggested that such a low fee structure might well drive out some of the larger companies: “They drove a stake in the ground,. I think, to see what kind of reaction they would get,” this person said. “Anything less than 4, 4.5 percent – forget about it. It’s just not worth it to us.”
