DOE's $653M Uranium Disposition Services Contract Awarded to Uranium Disposition Services, LLC
Contract Overview
Contract Amount: $653,564,512 ($653.6M)
Contractor: Uranium Disposition Services, LLC
Awarding Agency: Department of Energy
Start Date: 2002-08-29
End Date: 2011-03-28
Contract Duration: 3,133 days
Daily Burn Rate: $208.6K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 2
Pricing Type: COST PLUS INCENTIVE
Sector: Other
Place of Performance
Location: LEXINGTON, FAYETTE County, KENTUCKY, 40513
State: Kentucky Government Spending
Plain-Language Summary
Department of Energy obligated $653.6 million to URANIUM DISPOSITION SERVICES, LLC for work described as: Key points: 1. Contract awarded via full and open competition, suggesting a competitive bidding process. 2. The contract type is Cost Plus Incentive Fee, which can incentivize cost control but also carries inherent risk. 3. The duration of the contract was substantial at 3133 days, indicating a long-term service requirement. 4. The contract was awarded by the Department of Energy, a key agency for nuclear materials management. 5. The North American Industry Classification System (NAICS) code 561210 points to facilities support services. 6. The contract was awarded in August 2002 and expired in March 2011, indicating historical spending. 7. The contract value of $653,564,512.40 represents a significant investment in nuclear material disposition.
Value Assessment
Rating: fair
Benchmarking the value of this contract is challenging without specific performance metrics and detailed cost breakdowns. The Cost Plus Incentive Fee structure means actual costs could vary significantly from initial estimates. Comparing it to similar uranium disposition contracts would require access to proprietary pricing data and performance outcomes. However, the substantial award amount suggests a high-value, complex service requirement.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under 'full and open competition,' indicating that all responsible sources were permitted to submit bids. The presence of two bids (no: 2) suggests a degree of competition, but the exact number of interested parties and the rigor of the evaluation process are not detailed. A competitive process is generally expected to yield better pricing and value for the government.
Taxpayer Impact: A full and open competition aims to ensure that taxpayer dollars are used efficiently by fostering a competitive environment that drives down costs and improves service quality.
Public Impact
The primary beneficiaries are likely the Department of Energy and its mission to manage and dispose of nuclear materials safely and securely. The services delivered involved the disposition of uranium, a critical component of nuclear material management. The contract was performed in Kentucky (st: KY, sn: KENTUCKY), indicating a specific geographic focus for these services. The contract supported specialized workforce needs related to nuclear material handling and disposition.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost Plus Incentive Fee contracts can lead to cost overruns if not managed tightly.
- The long duration of the contract (3133 days) increases the risk of scope creep or evolving requirements.
- Limited information on the specific performance metrics makes it difficult to assess the contractor's effectiveness fully.
Positive Signals
- Awarded through full and open competition, suggesting a robust and fair bidding process.
- The contract addressed a critical national security and environmental need for uranium disposition.
- The contractor, Uranium Disposition Services, LLC, was specifically formed or designated for this purpose, implying specialized expertise.
Sector Analysis
This contract falls within the broader sector of government contracting for specialized environmental and facilities support services, particularly related to nuclear materials. The market for such services is highly specialized, often dominated by a few firms with the necessary security clearances, expertise, and infrastructure. The Department of Energy is a primary client for these types of contracts, managing significant legacy nuclear materials.
Small Business Impact
The provided data indicates that small business participation (sb: false) was not a specific set-aside requirement for this contract. Therefore, the direct impact on small businesses through set-asides is likely minimal. However, the prime contractor may have engaged small businesses as subcontractors, though this information is not detailed in the provided data.
Oversight & Accountability
Oversight for this contract would have been primarily managed by the Department of Energy's contracting officers and program managers. Given the nature of the work involving nuclear materials, stringent oversight and compliance with safety and security regulations would be expected. Inspector General jurisdiction would apply to potential fraud, waste, or abuse.
Related Government Programs
- Nuclear Materials Management
- Environmental Remediation Services
- Defense Nuclear Facilities
- Department of Energy Operations
Risk Flags
- Cost Plus Incentive Fee contract type carries inherent cost risk.
- Long contract duration increases potential for scope creep and evolving requirements.
- Nuclear materials handling requires stringent safety and security oversight.
- Limited public data on specific performance metrics hinders full value assessment.
Tags
department-of-energy, uranium-disposition, facilities-support-services, cost-plus-incentive-fee, full-and-open-competition, kentucky, nuclear-materials, long-term-contract, historical-spending, government-contracting
Frequently Asked Questions
What is this federal contract paying for?
Department of Energy awarded $653.6 million to URANIUM DISPOSITION SERVICES, LLC. See the official description on USAspending.
Who is the contractor on this award?
The obligated recipient is URANIUM DISPOSITION SERVICES, LLC.
Which agency awarded this contract?
Awarding agency: Department of Energy (Department of Energy).
What is the total obligated amount?
The obligated amount is $653.6 million.
What is the period of performance?
Start: 2002-08-29. End: 2011-03-28.
What was the specific nature of the uranium disposition services provided under this contract?
The contract for Uranium Disposition Services, LLC, awarded by the Department of Energy, focused on the disposition of surplus or excess uranium materials. This typically involves processes such as stabilization, packaging, and long-term storage or disposal of nuclear materials to ensure safety and security. The exact technical processes would depend on the form and isotopic content of the uranium, and the specific requirements outlined in the contract's statement of work. The goal is to manage these materials in a way that mitigates proliferation risks and environmental hazards.
How did the Cost Plus Incentive Fee (CPIF) structure impact the final cost and contractor performance?
A Cost Plus Incentive Fee (CPIF) contract allows the contractor to recover allowable costs plus a negotiated fee that is adjusted based on performance against pre-determined targets. For this contract, the fee would have been adjusted based on factors like cost savings, schedule adherence, or specific performance milestones related to uranium disposition. While CPIF aims to incentivize efficiency, it also means the final cost could deviate from the initial estimate. Without detailed performance reports, it's difficult to quantify the exact impact of the incentive structure on the final $653 million expenditure. Effective government oversight is crucial to ensure the incentives align with desired outcomes and taxpayer value.
What were the key risks associated with this uranium disposition contract?
Key risks associated with this contract likely included technical challenges in handling and processing radioactive materials, potential cost overruns due to the CPIF structure, and ensuring strict adherence to safety and security protocols. The long duration (over 8 years) also presented risks related to evolving regulations, material degradation, and maintaining specialized workforce expertise. Furthermore, the sensitive nature of nuclear materials necessitates robust security measures to prevent diversion or unauthorized access, posing a significant risk if not managed properly. Environmental risks, such as potential contamination, would also be a primary concern.
How does this contract compare to other federal spending on nuclear materials management?
This contract, with an award value of approximately $653 million over its lifespan, represents a significant but not extraordinary expenditure within the broader context of federal nuclear materials management. The Department of Energy manages a vast inventory of nuclear materials, and disposition activities are a long-term, costly undertaking. Annual federal spending on nuclear non-proliferation, environmental cleanup, and materials management often runs into billions of dollars across various agencies. This specific contract likely addressed a particular subset of uranium disposition needs, and its scale is commensurate with the complexity and volume of materials involved.
What was the historical spending trend for uranium disposition services by the Department of Energy around the time of this contract?
Historical spending data for uranium disposition services by the Department of Energy prior to and during the period of this contract (2002-2011) would likely show a consistent, substantial investment. The DOE has been responsible for managing and reducing the inventory of surplus nuclear materials resulting from decades of defense programs and civilian nuclear energy activities. Spending in this area is driven by long-term stewardship requirements, international agreements (like those concerning highly enriched uranium), and the need to address legacy environmental issues. While specific figures for 'uranium disposition' as a distinct category might fluctuate, overall spending on nuclear materials management and cleanup has been a significant and ongoing budgetary item for the DOE.
Industry Classification
NAICS: Administrative and Support and Waste Management and Remediation Services › Facilities Support Services › Facilities Support Services
Product/Service Code: OPERATION OF GOVT OWNED FACILITY › OPERATE GOVT OWNED BUILDINGS
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Offers Received: 2
Pricing Type: COST PLUS INCENTIVE (V)
Contractor Details
Address: 1009 COMMERCE PARK DR # 101, OAK RIDGE, TN, 03
Business Categories: Category Business, Foreign-Owned and U.S.-Incorporated Business, Not Designated a Small Business, Special Designations
Financial Breakdown
Contract Ceiling: $685,088,806
Exercised Options: $685,088,806
Current Obligation: $653,564,512
Actual Outlays: $61,974
Timeline
Start Date: 2002-08-29
Current End Date: 2011-03-28
Potential End Date: 2011-03-28 00:00:00
Last Modified: 2013-01-22
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