Mike Nartker
WC Monitor
2/14/2014
LATA Environmental Services of Kentucky, LLC, the cleanup contractor for the Paducah site, earned approximately 90 percent of its available Fiscal Year 2013 fee, according to information the Department of Energy released this week. In total, LATA Kentucky earned $3.02 million out of an available $3.37 million, including $1.80 million for completing 89 percent of a set of Performance Based Incentives, according to a Feb. 6 award fee determination letter from Bill Murphie, head of the Department of Energy’s Portsmouth/Paducah Project Office. LATA Kentucky also received approximately $1.22 million out of an available $1.35 million in fee tied to subjective categories of performance, for which the contractor also received an overall rating of “very good,” according to the letter.
LATA Kentucky has seen continual improvement in its fee performance since Fiscal Year 2011 (its first full year at Paducah), when it earned only one-third of its available fee (WC Monitor, Vol. 23 Nos. 13&14). In FY 2012, however, LATA Kentucky made a significant improvement in performance and earned approximately 80 percent of its available fee (WC Monitor, Vol. 24 No. 14). The DOE Portsmouth/Paducah Project Office declined to provide additional comment on LATA Kentucky’s FY 2013 fee evaluation this week. LATA Kentucky Program Manager Mark Duff praised the contractor’s workforce and management team late this week, telling WC Monitor that they “demonstrated a real dedication to safety because that’s the first element. … We’re not perfect by any means, but we had two really, really good years with no recordables while we’re doing hazardous work. If you can get that down, what it really means is people are embracing your culture and your expectations relative to procedures and relative to performance.” He added, “Once you get those things down, it starts falling into place and that’s how it’s been for us.”
Projects Completed ‘Ahead of Schedule,’ On Cost
In his letter, Murphie praised LATA Kentucky for completing several projects “ahead of schedule” and within allocated costs. “LATA Kentucky provided excellent project management and cost control for many of the projects (e.g., SWMU 4, C-340 Demolition and Southwest Plume). However, LATA Kentucky has opportunities for improvement in project management, including improving cost control, project estimating, and ensuring efficient utilization of Government Furnished Services and Information,” Murphie wrote.
Murphie also highlighted LATA Kentucky’s strong safety performance in FY 2013. “LATA Kentucky completed the year without any Total Recordable Cases or Days Away, Restrictions and Transfers cases, for the second year in a row, and completed 2.3 million work hours without a lost work day due to job-related injury or illness. This was accomplished in spite of several challenges, including reductions in the work force, and the hazardous nature of the work activities,” he wrote. “LATA Kentucky’s process improvement initiatives related to the implementation of the safety management programs have been effective in meeting the DOE Environmental Management goals.”
Contract in a State of ‘Overrun’
Murphie did note in his letter that LATA Kentucky’s contract “continues to be in an overrun condition,” adding, “LATA Kentucky is encouraged to implement sound cost savings measures to limit the effects of the overrun.” According to DOE, the overrun is $63.6 million on a contract value of approximately $363.5 million. Duff said LATA Kentucky has submit a revised baseline proposal to DOE for approval. “By Earned Value Management System definition, we’re over the bid that we submitted. But when you consider changed conditions, when you consider REAs [Requests for Equitable Adjustment] and those kinds of things, and when you consider the fact that we had some projects that were underestimated … when you consider all of those changes and submit a new baseline that lines up with reality, once that gets approved we’ll be on track,” he said.
Focus on Project Controls Improvements This Year
Duff declined to say what specific projects LATA Kentucky plans to pursue this fiscal year at Paducah, but did say the contractor would look to continue to make improvements in project controls. “If I had to focus on one area that frustrates our client more than anything, it’s focused on project controls and the element of project controls associated with planning,” Duff said. “We still find ourselves getting surprises on performance. … We constantly have surprises. Sometimes you can manage them with no impact and other times there’s impacts. I’d have to say if there’s any technical area that we need to improve on, that’s the top of the list—being able to see the impacts before we get there and being able to manage them to minimize them.”
