The final Request for Proposals for the new Idaho Cleanup Project (ICP) Core contract contains “a fairly balanced incentive plan,” Jack Surash, deputy assistant secretary for acquisition and project management in the Department of Energy’s Office of Environmental Management, said yesterday. In response to industry concerns, DOE modified the proposed fee approach to allow the winner to earn some final fee over the five-year course of the contract while keeping some fee from being final until the end to incentivize performance, Surash said in remarks at this year’s Waste Management conference, held in Phoenix. “I await to see what the market response to that is,” Surash said.
When DOE issued an initial draft RFP for the new Idaho contract last fall, nearly all potential bidders made it clear that they could not bid on the contract as then outlined 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 to industry concerns, DOE subsequently modified the draft RFP to remove a provision that would have made contractors responsible for all costs going forward once the target cost for the new contract had been exceeded by $150 million. DOE later announced plans to reduce the amount of fee that would be considered “provisional” and subject to potential clawback. The final RFP for the new Idaho contract, issued late last week, included another round of changes to the fee structure.