GAO Releases More Details on Contested Y-12/Pantex Contract

Questionable procurement decisions at the National Nuclear Security Administration have emerged with the release of a ruling on a contested contract awarded for management of the Y-12 and Pantex sites.

Babcock & Wilcox currently oversees the sites and was among the bidders that challenged the award to a Bechtel-led consortium called Consolidated Nuclear Security in January. The Government Accountability Office, which hears appeals of federal contract decisions, announced its recommendation to reopen the contract process earlier but only recently released its detailed reasoning for doing so.

Y-12. Source: DOE via WikipediaIn its ruling, the GAO stated, "We sustain the protests based on the agency’s failure to reasonably evaluate the feasibility and size of the offerors’ proposed cost savings, as required by the terms of the solicitation."

It noted that the source selection authority – the official in charge of picking the winning bidder – changed days before the award. Earlier, NNSA staff evaluated the likelihood that cost savings proposed in each bid would actually be realized. But, the GAO said, the new SSA "acknowledged that he did not perform any independent cost savings analysis, and further testified that he was unaware that various portions of the proposed cost savings had been evaluated by the CSAC (the agency’s own 'financial management specialists') as 'not reasonable,' 'partially reasonable,' or 'cannot determine.'"

The amounts of the questionable savings associated with each bid were redacted from the ruling released to the public. Nonetheless, the GAO said NNSA should have considered them and sought additional information where appropriate.

In its conclusion, the ruling read, "We also recommend that, based on that evaluation, the agency make a
new source selection decision taking into consideration the relative size of the offerors’ feasible cost savings."

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