Army ponders contract changes

Incentive deals sought to curb costs of cleanups

Officials expect to save 15%

Watchdog groups worry about lack of oversight

November 30, 2003|By Lane Harvey Brown | Lane Harvey Brown,SUN STAFF

The Army is considering broad, cost-conscious changes in how environmental cleanup contracts are written at Aberdeen Proving Ground, Fort Detrick, Fort Meade and three other bases in the Maryland-Washington area.

In the multibillion-dollar world of military base remediation, Army officials say 15 percent of cleanup costs could be saved by using "performance-based" contracting, which relies on incentives, fixed prices - and less government prescription - to get the job done.

Army officials say $5.2 billion has been spent on cleanup; by 2011, they expect to spend another $3.4 billion, not including closed sites.

Officials hope that by 2007, 80 percent of the 109 sites in the Army's remediation program will use performance-based contracting. Today, they say, that figure is just shy of 10 percent.

The six capital area sites - which also include Phoenix Military Reservation, a former Nike missile site in Baltimore County, and Walter Reed Army Medical Center and Fort McNair in the District of Columbia - are dealing with a host of ills, from chemical-contaminated ground water to unexploded ordnance and medical, chemical and nuclear waste.

"Each installation will be reviewed to see if performance-based contracting can be applied," said Robert DiMichele, spokesman for the Army Environmental Center, the command based at the proving ground that is overseeing the nationwide shift.

DiMichele said where current contracts are written by the government very specifically, the new contracting method would give the contractor more flexibility. In performance-based contracting, "we tell them, `move to conclusion,'" he said. "How they get there through the regulatory procedure is more flexible."

That leeway has sparked concerns from the community and some local base officials.

Ted Henry of the APG restoration advisory board - a group of regulators, Army officials and the community that watches cleanup projects - said the move appears to be a purely business decision. From the board's perspective, he said, not much thought has been given to how the new system will affect community input, field investigations and regulatory oversight.

"Right now, the community has some leverage over a government entity, because taxpayers have a role," Henry said. "There won't be that kind of leverage over a contractor."

He added: "Who's going to watch the process? How are you going to avoid cutting corners and corruption?"

When a decision on how to clean up a site has been reached, and the directive is clear, Henry said, fixed-price and performance-based contracting might work. But if a site's contamination is being assessed, he said of private contractors, "the less they find, the more money they make."

Avoiding `cost creep'

Randy Cerar, director of cleanup for the Army Environmental Center, said the new system will not allow contractors to circumvent state and federal regulations on cleanup but it will permit them to get work done without the "cost creep" and inefficiencies that have hampered cleanup efforts in many places.

"Some of those documents seem to go on forever," he said of comments taken from regulators and the community as projects progress. The question for the AEC, he said, is "how do we get through them faster for the Army, regulators and community?"

He said the move will motivate private contractors to accept responsibility for completing cleanup work quickly and encourage companies to put their best teams on the job because they - not the military - will assume the primary risk for jobs not getting done on time and properly.

But critics see the potential for contractors - who offer low prices but lack expertise in dealing with sticky military base remediation - to become overwhelmed by complex cleanups and end up cutting corners.

The move is also likely to spark environmental staff cuts at some bases, such as the proving ground, a Superfund site.

"We don't know where this is going to go," said Ken Stachiw, chief of the restoration program at the proving ground. Stachiw said 160 to 170 sites in the Edgewood and Aberdeen areas are active cleanup sites.

Cerar said for a complex site such as the Edgewood area of the proving ground, where so much uncertainty about contamination remains, a more flexible approach may be needed.

But DiMichele noted, even as the Army pumped some $48 million into APG cleanup from 2001 to 2003, the estimated overall remediation cost there rose from $292.4 million to $308.1 million as a result of cost growth and overruns.

Oversight concerns

Currently, Stachiw said, he has a staff of seven overseeing cleanup sites. But within two years, he said, his staff is projected to drop to two.

Oversight of contractors, he said, to protect the military's interest is critical. "Someone's got to be the government's advocate on this," Stachiw said. "EPA is relying on our oversight. They're trusting [us] to say the work is done."

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