DOE's $439M Paducah environmental cleanup contract awarded to LATA Environmental Services
Contract Overview
Contract Amount: $439,026,516 ($439.0M)
Contractor: Lata Environmental Services of Kentucky, LLC
Awarding Agency: Department of Energy
Start Date: 2010-04-22
End Date: 2017-07-25
Contract Duration: 2,651 days
Daily Burn Rate: $165.6K/day
Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES
Number of Offers Received: 5
Pricing Type: COST PLUS AWARD FEE
Sector: Other
Official Description: PADUCAH ENVIRONMENTAL REMEDIATION SERVICES - REMEDIATION AND DISPOSTION OF SPECIFIC AREAS ON THE PADUCAH GASEOUS DIFFUSION PLANT SITE TO INCLUDE FACILITY DECONTAMINATION AND DECOMMISSIONING, OPERATIONS OF SITE WASTE STORAGE FACILITIES AND WASTE DISPOSITION
Place of Performance
Location: KEVIL, MCCRACKEN County, KENTUCKY, 42053
State: Kentucky Government Spending
Plain-Language Summary
Department of Energy obligated $439.0 million to LATA ENVIRONMENTAL SERVICES OF KENTUCKY, LLC for work described as: PADUCAH ENVIRONMENTAL REMEDIATION SERVICES - REMEDIATION AND DISPOSTION OF SPECIFIC AREAS ON THE PADUCAH GASEOUS DIFFUSION PLANT SITE TO INCLUDE FACILITY DECONTAMINATION AND DECOMMISSIONING, OPERATIONS OF SITE WASTE STORAGE FACILITIES AND WASTE DISPOSITION Key points: 1. Contract focused on significant environmental remediation and decommissioning at the Paducah Gaseous Diffusion Plant. 2. Awarded through full and open competition, indicating a robust bidding process. 3. The contract utilized a Cost Plus Award Fee (CPA) structure, incentivizing performance. 4. Duration of over 8 years suggests a long-term commitment to site remediation. 5. Geographic focus on Kentucky highlights regional environmental impact and workforce implications. 6. The scale of the contract points to substantial investment in nuclear site cleanup.
Value Assessment
Rating: good
The total award value of over $439 million for an 8-year environmental remediation project is substantial. Benchmarking this against similar large-scale Department of Energy cleanup contracts is complex due to site-specific factors. However, the Cost Plus Award Fee (CPA) structure suggests an attempt to control costs while incentivizing efficient performance. Without detailed cost breakdowns and performance metrics, a precise value-for-money assessment is challenging, but the competitive award process provides some assurance of fair pricing.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
This contract was awarded under 'full and open competition after exclusion of sources,' which implies a competitive process was initiated but specific sources were later excluded, potentially due to specialized capabilities or prior performance. The presence of multiple bidders (5 indicated) suggests a healthy level of competition for this significant environmental services contract. This competitive environment generally leads to better price discovery and potentially more favorable terms for the government.
Taxpayer Impact: The full and open competition, despite source exclusions, likely resulted in a more competitive pricing structure, benefiting taxpayers by ensuring the government received proposals from multiple qualified entities.
Public Impact
The primary beneficiaries are the Department of Energy and the public, through the cleanup and remediation of a former nuclear facility. Services delivered include facility decontamination, decommissioning, waste storage operations, and waste disposition. The geographic impact is concentrated in Paducah, Kentucky, addressing long-standing environmental concerns. Workforce implications include employment opportunities for skilled labor in environmental remediation and related fields within Kentucky.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for cost overruns inherent in Cost Plus Award Fee contracts if not closely managed.
- Complexity of environmental remediation can lead to unforeseen challenges and schedule delays.
- Ensuring consistent and effective waste disposition methods are employed throughout the contract lifecycle.
Positive Signals
- Awarded through a competitive process, suggesting a strong proposal from the contractor.
- The CPA structure provides incentives for meeting performance objectives and managing costs effectively.
- Long contract duration allows for sustained focus and expertise development in remediation efforts.
Sector Analysis
This contract falls within the Environmental Remediation Services sector, a critical area for government agencies managing legacy industrial and defense sites. The market for such services is specialized, requiring expertise in hazardous material handling, decontamination, and regulatory compliance. The Department of Energy is a major client in this sector, with numerous sites requiring extensive cleanup. Spending benchmarks are highly variable, depending on the scale, complexity, and type of contamination at each site.
Small Business Impact
The data indicates this contract was not set aside for small businesses (ss: false, sb: false). While LATA Environmental Services of Kentucky, LLC is the prime contractor, there is no explicit information on subcontracting plans for small businesses within this dataset. Large environmental remediation contracts often involve significant subcontracting opportunities, but the extent to which small businesses will participate is not detailed here. Further analysis of subcontracting reports would be needed to assess the impact on the small business ecosystem.
Oversight & Accountability
Oversight for this contract would primarily reside with the Department of Energy's contracting officers and program managers. Given the nature of environmental remediation and the potential for significant environmental and financial impact, robust oversight mechanisms, including regular progress reviews, site inspections, and audits, would be expected. Transparency would be facilitated through contract reporting requirements and potentially public-facing environmental monitoring data. Inspector General jurisdiction would apply to investigations of fraud, waste, or abuse.
Related Government Programs
- Department of Energy Environmental Management Program
- Superfund Remediation Projects
- Defense Environmental Cleanup Program
- Nuclear Site Decommissioning Contracts
Risk Flags
- Potential for cost overruns in CPA contracts.
- Complexity of environmental remediation leading to schedule delays.
- Long-term waste management and disposition challenges.
- Ensuring compliance with evolving environmental regulations.
Tags
environmental-remediation, department-of-energy, kentucky, cost-plus-award-fee, large-contract, full-and-open-competition, nuclear-facility, decommissioning, waste-disposition, federal-contract
Frequently Asked Questions
What is this federal contract paying for?
Department of Energy awarded $439.0 million to LATA ENVIRONMENTAL SERVICES OF KENTUCKY, LLC. PADUCAH ENVIRONMENTAL REMEDIATION SERVICES - REMEDIATION AND DISPOSTION OF SPECIFIC AREAS ON THE PADUCAH GASEOUS DIFFUSION PLANT SITE TO INCLUDE FACILITY DECONTAMINATION AND DECOMMISSIONING, OPERATIONS OF SITE WASTE STORAGE FACILITIES AND WASTE DISPOSITION
Who is the contractor on this award?
The obligated recipient is LATA ENVIRONMENTAL SERVICES OF KENTUCKY, LLC.
Which agency awarded this contract?
Awarding agency: Department of Energy (Department of Energy).
What is the total obligated amount?
The obligated amount is $439.0 million.
What is the period of performance?
Start: 2010-04-22. End: 2017-07-25.
What was the specific rationale for excluding certain sources in a 'full and open competition after exclusion of sources' award?
The designation 'full and open competition after exclusion of sources' suggests that while the initial solicitation was open to all qualified bidders, certain potential offerors were subsequently excluded from the final evaluation or award. This exclusion could be based on various factors, such as failure to meet specific technical requirements, past performance issues, inability to meet security clearances, or a determination that their proposed solution was not the best value. The Department of Energy would have documented the specific reasons for excluding any sources, often related to ensuring the most capable and responsible contractor was selected for a complex and high-risk project like environmental remediation. This process aims to balance broad competition with the need to select a contractor demonstrably able to perform the demanding scope of work.
How does the Cost Plus Award Fee (CPA) structure typically function in environmental remediation contracts?
A Cost Plus Award Fee (CPA) contract provides for the reimbursement of allowable incurred costs plus a fee that has a fixed component and an award-based component. The award fee is earned based on the contractor's performance against pre-determined criteria, often related to schedule, cost control, quality, safety, and technical objectives. For environmental remediation, this means the contractor is reimbursed for their direct costs (labor, materials, equipment) and potentially a base fee. An additional award fee is then determined by the government based on how well the contractor meets or exceeds performance expectations outlined in the contract's award-fee plan. This structure incentivizes the contractor to go beyond minimum requirements to achieve superior performance, which can be beneficial for complex projects like the Paducah cleanup where outcomes are critical.
What are the key performance indicators (KPIs) typically used to evaluate contractors on large-scale environmental remediation projects?
Key performance indicators (KPIs) for large-scale environmental remediation projects often focus on safety, environmental compliance, cost control, schedule adherence, and technical execution. Safety KPIs might include metrics like incident rates (e.g., Total Recordable Incident Rate - TRIR) and lost-time injuries. Environmental compliance KPIs would track adherence to permits, regulatory standards, and waste management protocols, ensuring no new contamination is introduced. Cost control KPIs would monitor spending against budget and the efficiency of resource utilization. Schedule adherence KPIs measure progress against project milestones and overall completion dates. Technical execution KPIs assess the effectiveness of remediation techniques, the quality of work performed, and the successful achievement of cleanup objectives, such as contaminant reduction levels.
What is the typical duration and total value range for similar large-scale DOE environmental remediation contracts?
Large-scale Department of Energy (DOE) environmental remediation contracts, particularly those involving complex sites like gaseous diffusion plants, often have durations ranging from 5 to 15 years and total award values from hundreds of millions to billions of dollars. The Paducah contract, with a duration of over 8 years and a value of approximately $439 million, falls within this typical range. Factors influencing duration and value include the volume of waste, the extent of contamination, the complexity of the remediation technologies required, and the regulatory framework governing the cleanup. Contracts for decommissioning facilities often extend for many years due to the phased nature of the work and the need for long-term monitoring and verification.
What are the potential long-term environmental and economic impacts of the Paducah Gaseous Diffusion Plant cleanup?
The long-term environmental impact of the Paducah cleanup is the restoration of the site to a condition that protects human health and the environment, reducing risks associated with historical radioactive and chemical contamination. Economically, the project represents a significant injection of funds into the local Kentucky economy through jobs, procurement, and support services over its multi-year duration. Post-remediation, the site could potentially be repurposed for future economic development, although residual land use restrictions might apply depending on the final cleanup standards achieved. The successful completion of the cleanup also enhances the DOE's overall environmental stewardship record and contributes to the national effort to manage legacy nuclear materials and facilities.
Industry Classification
NAICS: Administrative and Support and Waste Management and Remediation Services › Remediation and Other Waste Management Services › Remediation Services
Product/Service Code: SALVAGE SERVICES › DEMOLITION OF NONBUILDING FACILITY
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Solicitation ID: DE-RP30-09CC40020
Offers Received: 5
Pricing Type: COST PLUS AWARD FEE (R)
Evaluated Preference: NONE
Contractor Details
Parent Company: LOS Alamos Technical Associates, Inc. (UEI: 089416002)
Address: 2424 LOUISIANA BLVD NE STE 400, ALBUQUERQUE, NM, 87110
Business Categories: Category Business, Limited Liability Corporation, Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $455,796,517
Exercised Options: $439,026,516
Current Obligation: $439,026,516
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2010-04-22
Current End Date: 2017-07-25
Potential End Date: 2017-07-25 00:00:00
Last Modified: 2021-08-18
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