Contracting methods and management systems of remedial action contracts within the U.S. Navy's installation restoration program.

248 Pages·2.4 MB·en_US

by  Banaji, Darius.

CONTRACTING METHODS AND MANAGEMENT SYSTEMS
OF REMEDIAL ACTION CONTRACTS WITHIN THE U.S. NAVY'S
INSTALLATION RESTORATION PROGRAM
by
Darius Banaii
B S. Civil Eng., Univ. ofWashington
(1986)
Submitted to the Department of Civil and Environmental Engineering
in Partial Fulfillment ofthe Requirements for the Degree of
MASTER OF SCIENCE
in Civil and Environmental Engineering
at the
MASSACHUSETTS INSTITUTE OF TECHNOLOGY
September 1993
©1993 Darius Banaji
All rights reserved
The author hereby grants to MIT permission to reproduce and to distribute publicly paper
and electronic copies ofthis thesis document in whole or in part.

CONTRACTING METHODS AND MANAGEMENT SYSTEMS
OF REMEDIAL ACTION CONTRACTS WITHIN THE NAVY'S
U.S.
INSTALLATION RESTORATION PROGRAM
by
Darius Banaji
Submitted to the Department ofCivil and Environmental Engineering
on July 23, 1993 in partial fulfillment ofthe
requirements for the Degree ofMaster ofScience in
Civil and Environmental Engineering
ABSTRACT
To date, Department ofDefense (DoD) officials have identified over 17,660 potentially
hazardous waste sites at nearly 2,000 DoD installations. Some DoD experts estimate the
total cleanup bill to exceed $24 billion over the next 20 years. To date, the Navy itselfis
responsible for the cleanup ofsome 2,500 potential sites at nearly 300 Navy and Marine
Corps installations. The Navy estimates their cleanup costs will exceed $3 billion.
To meet the challenges ofthe next century, the Navy should carefully investigate those
areas ofits Installation Restoration Program that can be improved. Key components of
the program include: Comprehensive Long-term Environmental Action, Navy (CLEAN)
contracts already in place for activities from site investigation through remedial design;
and a relatively new and evolving component, Remedial Action Contracts (RACs),
charged with site remediation.
This thesis analyzes the contract framework and management system for Navy RACs, and
assesses the following:
1.) The evolution ofthe pilot RACs;
2.) The effectiveness ofthese contracts for timely site remediation;
3.) Recommended improvements required for future RACs.
The two "most" suitable contracting methods for Navy Remedial Action Contracts are,
General Contractor or Design-Build Team, both on a reimbursable basis. All eight pilot
RACs were written for a general contractor on a cost-plus-fixed-fee basis, with
competitive source selection. Contractors are responsible for site remediation by
predominant contaminant type at any Navy/Marine Corps installation throughout the U.S.
and its territories. The second generation ofRACs are also being written for a general
contractor through competitive source selection, but on a cost-plus-award-fee basis, with
each contract being geographic specific, and requiring that the contractor be generally
capable ofremediating all contaminant types.

The Navy has selected an appropriate contract organization, type, and award method for
environmental restoration contracting. However, to date, only a few sites have been
cleaned up. The process has been slower than anticipated. An immediate partial solution
would be to modify the pilot RACs and those contracts pending award, to include the
concept ofpartnering.
As the Navy's program matures and additional contracts are written, the Navy should
consider the distinct advantages ofadopting a design-build contract (on a
cost-plus-award-fee basis). In addition, the Navy should consider the combination ofa
"cost type" contract with unit prices for tasks that can be quantified. This would reduce
the financial risk to the Navy, increase control over contractor productivity, and reduce
the administrative burdens ofa purely "cost type" contract.
Finally, the success ofthe program will not be determined solely by the choice ofan
innovative contracting method, but by the individuals tasked to provide technical,
contractual, and daily site monitoring. A more aggressive training program should be in
place before awarding any future remedial action contracts.
Thesis Supervisor: Dr. Fred Moavenzadeh
Title: Director, Center for Construction Research and Education