March 17, 2014

LAWMAKER PRESSES NNSA TO ACCEPT GAO RECOMMENDATION ON Y-12/PANTEX

By ExchangeMonitor

The possibility that the National Nuclear Security Administration could ignore the Government Accountability’s recommendation to reopen the Y-12/Pantex procurement is starting to raise some eyebrows among industry officials and those in Congress. In the wake of the GAO’s decision to uphold protests of the $22.8 billion Y-12/Pantex contract by teams led by incumbent Babcock & Wilcox and Fluor/Jacobs, the NNSA has said it will “take some time before settling on our path forward” but officials have told NW&M Monitor that “there are good options available.” The GAO said that NNSA did not adequately vet proposed cost savings included in proposals from the three bidders for the contract, and it recommended that the agency reevaluate additional cost savings data from the bidder before making a new selection. “I believe NNSA should follow the recommendations of the GAO and move quickly to get this matter resolved,” Rep. Mac Thornberry (R-Texas), who represents the Pantex Plant, told NW&M Monitor. “We do not need to have the nation’s nuclear weapons complex in limbo over a contract dispute with so much essential work to be done, especially with sequestration still looming.”

As the main arbiter of procurement disputes, the GAO is often used to settle protests, but its recommendations are not binding. However, it’s rare that an agency ignores GAO’s recommendations completely. In Fiscal Year 2012, the GAO closed 2,371 protests, 40 cost claims and 84 requests for reconsideration, and in only three instances did an agency choose to ignore GAO’s recommendations, and each involved a Department of Veteran’s Affairs contract. An agency has 60 days to notify the GAO that it is not complying with the GAO’s recommendations. GAO, in turn, is required to inform Congress. The protesters could take their challenges to federal court in that case.

Notably, in 2009 the NNSA sought to challenge a GAO decision to sustain a protest. At issue was a contract awarded to Navarro Research and Engineering to perform cleanup work at what is now known as the Nevada National Security Site. S.M. Stoller and North Wind filed protests with the GAO over the award, though North Wind subsequently withdrew its protest prior to the GAO making a decision. In March 2009, the GAO sustained Stoller’s protest, which was then followed by an appeal from Navarro to have the agency reconsider its decision. Soon after Navarro filed its appeal, the NNSA followed suit asking the GAO to reconsider its decision to sustain Stoller’s protest. In the summer of 2009, the GAO stuck with its decision, rejecting the appeals filed by both Navarro and the NNSA. In the end, though, the matter was settled when Navarro and Stoller reached an agreement in which Stoller agreed to give up its challenge of Navarro’s win of the new contract in exchange for a subcontracting role.

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