[CPEO-MEF] Fixed Price Contracting and "Remedy in Place"

[Lenny Siegel <lsiegel@cpeo.org>]

The following internal Army memo concludes that the signing of a
Guaranteed Fixed Price Remediation Contract covering a site is not
equivalent to a Remedy in Place or Response Complete for accounting
purposes - that is, internal Army records AND reports to Congress.
However, when cleanup is "privatized" or otherwise transferred to a
third party through an Environmental Services Cooperative Agreement, it
may be counted as Remedy in Place once the agreed upon payments have
been made to the third party under that agreement.

Note: The internal accounting that a site has achieved a remedy in place
or response complete is not equivalent to regulatory sign-off.

Lenny Siegel 


***


Action Requested:

RIP/RC has to be physically achieved at the site level.
-When Army (Active/Excess/BRAC/FUDS) is managing the cleanup
-Site level RIP/RC cannot be claimed in the database until achieved.
-Sites cannot be collapsed for PBC accounting.

Exception
-When cleanup is transferred to a third party (e.g. Environmental
Services Cooperative Agreement, privatization)
-Sites level RIP/RC can be claimed when all funds have been transferred
to the third party.

This course of action is effective with the Fall 2003 data call due to
OSD on 7 Nov 03. For BRAC, any PBC work done in FY 2002 and prior does
not have to be changed in the database.

Database modifications

AEC and USACE need to take action to update AEDB-R and FUDSMIS, as
required, to track PBC contract award at the site level. If multiple
site phases are funded simultaneously, phase start and completion dates
must reflect the time period the work is actually performed. The
database must be able to show a future phase work when a cost to
complete (CTC) estimate is not required. For example, a design/build
concept would have remedial design and remedial action (construction)
(RA(C)) phases funded at the same time, but the start of the RA(C) might
be a year or more in the future. CTC for the RA(C) phase would not be
required and the phase would be shown as future.

Background

A contracting meeting among ESOH, ODEP, and AEC was held on 30 Oct 03.
As part of the meeting, the tracking of site progress when a
performance-based contract (PBC) is awarded was discussed. AEC indicated
that progress towards remedy in place/response complete (RIP/RC)
increased based upon the award of five Guaranteed Fixed Price
Remediation Contracts (GFPRs). Site progress had been achieved by
collapsing open sites into one site to track the GFPR contract. A follow
on meeting on 4 Nov 03 between ESOH and ODEP was held. Based upon the
follow on meeting, the following course of action in the Army will be taken.

-- 


Lenny Siegel
Director, Center for Public Environmental Oversight
c/o PSC, 278-A Hope St., Mountain View, CA 94041
Voice: 650/961-8918 or 650/969-1545
Fax: 650/961-8918
<lsiegel@cpeo.org>
http://www.cpeo.org

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