xvEPA
United States
Environmental Protection
Agency
Office of Solid EPA 542/R-92/002
Waste and Emergency Response ' April 1992
Washington DC 20460
Procuring Innovative
Treatment Technologies at
Remedial Sites:
Regional Experiences and
Process Improvements
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542/R-92/002
April 1992
Procuring Innovative Treatment Technologies at Remedial Sites:
Regional Experiences and Process Improvements
Study Produced By:
Technology Innovation Office
Walter W. Kovalick, Director
Technology Innovation Office
Office of Solid Waste and Emergency Response
U.S. Environmental Protection Agency
Washington, DC 20460
Printed on Recycled Paper
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DISCLAIMER
This document is not intended to and does not constitute any rulemaking,
policy or guidance by U.S. EPA, and cannot be relied upon to create a
substantive or procedural right enforceable by any party. Neither the
United States Government nor any of its employees, contractors,
subcontractors or their employees makes any warranty, expressed or
implied, or assumes any legal liability or responsibility for any third
party's use of or the results of such use of any information or procedure
disclosed in this report, or represents that its use by such third party would
not infringe on privately owned rights. The mention of trade names,
commercial firms, or ventures does not constitute an endorsement by U.S.
EPA.
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TABLE OF CONTENTS
: Page
Glossary iv
Chapter
I. Introduction and Background 1
II. Options in Remedial Action Contracting 3
III. Prior Efforts to Facilitate the Procurement
of Innovative Technologies . 11
IV. Summary of Findings 13
V. Remedial Site Experiences with Procuring
Innovative Technologies 17
VI. Recommendations and Concerns from Those Interviewed 37
Exhibit
1. Solicitation Options 3
2. Types of Contracts Used in the Superfund Program. 5
3. Contracting Options 7
111
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GLOSSARY
Alternative Remedial Contracting Strategy MARCS'): Prime contracts which may be used to
complete a remedial design of selected remedial alternatives, or award remedial action
subcontracts to execute the selected remedial action. One of the primary goals of ARCS is
to provide the maximum incentive for good contract performance through the use of
financial incentives. ARCS contracts are|awarded under a cpst-plus-award-fee contracting
arrangement. The base fee compensates the contractor for risk. The base fee amount does
not vary with performance, but rather is a fixed amount that will be paid to the contractor as
costs are incurred. The award fee is an award amount in addition to the base fee that may
be earned in whole or in part, based upon an evaluation of the contractor's performance.
Construction Contract: A construction contract is a contract for the construction, alteration,
or repair (including dredging, excavation, and painting) of buildings, structures, or other
real property.
Contract Acquisition Plan: A comprehensive plan which coordinates and integrates the
efforts of all personnel responsible for an acquisition. This plan outlines the process by
which the agency's need is to be fulfilled in a timely manner and at a reasonable cost. The
plan also outlines the overall strategy for managing the acquisition.
Cost Reimbursement Contract: Cost reimbursement types of contracts provide for payment
of allowable incurred costs, to the extent prescribed in the contract. These contracts
establish an estimate of total cost for the purpose of obligating funds and a ceiling that the
contractor may not exceed (except at its own risk) without the approval of the contracting
officer.
Design Specifications: Design specifications precisely state how the contract is to be
performed.
Firm Fixed Price (Lump Sum") Contract:; A firm fixed price (lump sum) contract provides
for a price that is not subject to any adjustment on the basis of the contractor's cost
experience in performing the contract. This contract type places upon the contractor
maximum risk and full responsibility for all costs and resulting profit or loss. It provides
maximum incentive for the contractor to control posts and perform effectively and imposes
a minimum administrative burden upon the contracting parties.
Indefinite Delivery/Indefinite Quantity (Unit Prices^, Contract: An indefinite
delivery/quantity (unit prices) contract provides for an indefinite quantity, within stated
limits, of specific supplies or services to be furnished during a fixed period, with deliveries
to be scheduled by placing orders with the contractor. Each supply or service is unit
priced.
Indemnification: Compensation for loss; or damage.
Invitation for Bid (IFB): An invitation for bid is a solicitation for sealed bids. Sealed
bidding is a method of contracting that employs competitive bids, public opening of bids,
and awards. The IFB includes all documents furnished to prospective bidders for the
purpose of bidding.
IV
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Negotiated Procurement: Contracting through the use of either competitive or other-than-
competitive proposals and discussions. Any contract awarded without using sealed
bidding procedures is a negotiated contract.
Performance Bond: Bonds are written instruments executed by a bidder or contractor (the
principal), and a second party (the surety or sureties), to assure fulfillment of the
principal's obligations to a third party (the obligee or Government), identified in the bond.
If the principal's obligations are not met, the bond assures payment, to the extent
stipulated, of any loss sustained by the obligee. A performance bond secures performance
and fulfillment of the contractor's obligations under the contract. An annual performance
bond is a single bond furnished by a contractor, in lieu of separate performance bonds, to
secure fulfillment of the contractor's obligations under contracts (other than construction
contracts) requiring bonds entered into during a specific Government fiscal year.
Performance Specifications: Performance specifications as defined in this report specify
the technology to be used and set goals to attain, but allow flexibility in design.
Request for Proposals (RFP): Requests for proposals are used in negotiated acquisitions to
communicate Government requirements to prospective contractors and to solicit proposals
from these contractors.
Responsible Prospective Contractor: To be determined responsible, a prospective
• contractor must have adequate financial resources to perform the contract, or the ability to
obtain them; be able to comply with the required or proposed delivery or performance
schedule; have a satisfactory performance record; have a satisfactory record of integrity and
business ethics; have the necessary organization, experiences, accounting and operational
controls, and technical skills (or the ability to obtain them); have the necessary production,
construction, and technical equipment and facilities (or the ability to obtain them); be
otherwise qualified and eligible to receive an award under applicable laws and regulations
(FAR 9.104-1).
Responsiveness of Bids: To1 be considered for award, a bid must comply in all material
respects with the invitation for bids. Such compliance enables bidders to stand on an equal
footing and maintain the integrity of the sealed bidding system (FAR 14.301).
Sealed Bidding: See "Invitation for Bid."
Service Contract: A service contract is a contract that directly engages the time and effort of
a contractor whose primary purpose is to perform an identifiable task rather than to furnish
an end item of supply.
Site-Specific Contract: A site-specific contract provides contract support tailored to the
needs of a specific site, types of sites, contaminants, or activities.
State Cooperative Agreement: A State cooperative agreement is a legal instrument which
EPA uses to transfer money, property, services, or anything of value to a State in order to
accomplish a public purpose in which substantial EPA involvement is anticipated during the
performance of the project.
Time and Materials Contract: A time and materials contract provides for acquiring supplies
or services on the basis of (1) direct labor hours at specified fixed hourly rates that include
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wageSj-overhead, general and administrative expenses, and profit and (2) materials at cost,
including, if appropriate, material handling costs as part of material costs.
Two-Step Invitation for Bid: Two-step sealed bidding is a combination of competitive
procedures designed to obtain the benefits of sealed bidding when adequate specifications
are not available. This bidding method is conducted in two steps: (1) A technical proposal
is requested, submitted, evaluated and (if: necessary) discussed. No pricing is involved.
The objective is to determine the acceptability of the supplies or services offered. (2)
Sealed price bids are submitted by those who submitted acceptable technical proposals.
These bids are evaluated and an award is made.
VI
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CHAPTER I
INTRODUCTION AND BACKGROUND
* • , •.
An innovative technology is a treatment technology for which cost or performance
information is incomplete, thus hindering routine use at hazardous waste sites. The
Comprehensive Environmental Response, Compensation, and Liability Act of 1980
(CERCLA) as amended by the Superfund Amendments and Reauthorization Act of 1986
(SARA), and the National Contingency Plan (NCP) encourage the use of innovative
treatment technology remedies if such remedies can be used: (1) at less cost; (2) with less
adverse impact; and/or, (3) to treat a site more effectively than other methods. In addition,
the EPA Administrator and the Office of Technology Assessment have urged EPA to strive
to reduce existing barriers which hinder the implementation of innovative technologies.
An action plan to deal with the barriers that impede the use of innovative
technologies to remediate soils and ground water that have been contaminated with
hazardous waste has been developed by EPA's Technology Innovation Office (TIO) based
on the recommendations of EPA staff, State agencies, professional associations, and
consulting engineers who specialize in hazardous waste remediation. This action plan
identified the procurement process as a key area which must be addressed to meet the goal
of reducing barriers to the use of innovative technologies.
Contracting for remedial action technologies, especially innovative treatment
technologies, can be difficult due to the Government and industry's lack of experience.
The experience base, both in applying the treatment technology and procuring it, is
currently being built. Innovative treatment technologies are relatively new and have often
not been applied to large clean-up projects. Because of the nature of subsurface
investigations of contamination, which must use a finite number of samples to infer
characteristics of an entire site, differing site conditions are common and inevitable once
remedial action begins. Quantities of soil and waste to be treated often vary widely from
initial calculations. Also, treatment technologies are not always construction projects, but
can be services pursuant to the definitions contained the Federal Acquisition Regulations
(FAR). Therefore, special considerations are needed in scoping the procurement of
innovative treatment technologies to ensure that both the Government and the contractor
benefit in cost, time and achievement of a successful clean-up.
In order to assist EPA Remedial Project Managers (RPMs) and Contracting Officers
(COs) with the procurement of innovative treatment technologies, TIO undertook an effort
to document case histories of existing experiences in the Superfund program with acquiring
innovative technologies. RPMs, COs, and U.S. Army Corps of Engineers (COE)
personnel were interviewed to obtain information on their experiences in procuring
innovative technologies. Remedial sites chosen for inclusion in this review were Fund-lead
sites that had started or completed the procurement of an innovative technology. The
innovative technologies which are discussed in this report include bioremediation, thermal
desorption, vacuum extraction, chemical treatment, chemical extraction, and in situ soil
flushing. The results of the interviews on the procurement of innovative technologies are
presented in this document. This report is organized into the following chapters:
• Chapter II, "Options in Contracting," presents an overview of the
contracting vehicles available to the remedial program in order to provide a
context for the results of the interviews at remedial sites
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Chapter in, "Prior Efforts to Facilitate the Procurement of Innovative
Technologies," presents the previous efforts of EPA's Procurement and
Contracts Management Division to address procurement issues, affecting the
acquisition of innovative technologies
Chapter IV, "Summary of Findings," presents the key points and issues
raised in the interviews with remedial sites on the procurement of innovative
technologies
Chapter V," Remedial Site Experiences with Procuring Innovative
Technologies," documents the experiences of remedial sites which have
procured, or are procuring, an innovative technology
Chapter VI," Recommendatioris and Concerns from Those Interviewed,"
identifies problems encountered in procuring innovative technologies, as
well as specific ideas on how the procurement process for obtaining
innovative technologies can be [improved.
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CHAPTER II
OPTIONS IN REMEDIAL ACTION CONTRACTING
This chapter presents an overview of the contracting vehicles available to the
remedial program in order to provide a context for the results of the interviews at remedial
sites.
The Federal Acquisition Regulations (FAR), Title 48 Code of Federal Regulations
Chapter 1, govern all executive agencies in their acquisition of supplies and services with
appropriated funds. The EPA Acquisition Regulations (EPAAR), Title 48 Code of Federal
Regulations Chapter 15 implement and supplement the FAR for EPA. The administrative
requirements for State Cooperative Agreements are outlined in Title 40 Code of Federal
Regulations Part 35. EPA Directive 1900, the Contracts Management Manual, sets forth
additional EPA policies and procedures on acquisition matters. The EPA Procurement and
D anaSement Dlvlsion has also issued guidance which supplements the FAR and
Solicitation Options
Exhibit 1 illustrates the solicitation options available in procurement In competitive
procurement, a Request for Proposals (RFP) is issued if the procurement is to be
negotiated, and an Invitation for Bid (IFB) is issued if sealed bids will be accepted If the
procurement is for an item under $25,000, a small purchase procurement is used A
relatively new approach is to prequalify bidders, and follow the prequalification with an
invitation for sealed bids (the "Two-Step" EFB).
Exhibit 1
Solicitation Options
Competitive
Sole Source
Over $25,000
2-Step IFB
Sole Source
Justification and
Negotiations
Under $25,000
RFP
Small Purchase
Key:
IFB: Invitation for Bid
RFP: Request for Proposal
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While it is difficult to use sole source contracting, the Competition in Contracting
Act of 1984 will permit an agency to limit competition if the property or services needed by
the agency are available from only one responsible source and no other type of property or
service will satisfy the needs of the agency.i In order to procure through a sole source
arrangement, a "Justification for Other than 'Full and Open Competition" (JOFOC) must be
completed. The JOFOC must include the following:
• Identification of the agency and the contracting activity, and specific
identification of the document as a JOFOC
• Nature and/or description of the action being approved
• Description of the supplies or services required to meet the agency's needs,
including the estimated value
• Identification of the statutory authority permitting other than full and open
competition
• Demonstration that the proposed contractor's unique qualifications or the
nature of the acquisition requires use of the authority cited
« Description of efforts made jto ensure that offers are solicited from as many
potential sources as is practicable, including whether a CBD notice was or
will be publicized
• Determination by the Contracting Officer that the anticipated cost to the
Government will be fair and reasonable
• Description of the market survey conducted and the results or a statement of
the reasons a market survey^was not conducted
• Any other facts supporting the use of other than full and open competition
Listing of the sources, if any, that expressed in writing an interest in the
acquisition ^ ; .
Statement of the actions, if any, the agency may take to remove or overcome
any barriers to competition before any subsequent acquisition for the
supplies or services required
• Contracting Officer certification that the justification is accurate and
complete to the best of the Contracting Officer's knowledge and belief.
In addition, the Government has to complete a price or cost analysis which ensures that the
price offered by the sole source provider accurately represents the costs of performing the
work.
The FAR does not apply if a subcontractor is providing the technology. FAR
applies to Federal agencies in the award of prime contractors. Prime contractors have to
comply with the applicable FAR subcontract clause in their contract, as explained in FAR
44.204.
A decision also has to be made as to which type of specifications to use in the
contract (design or performance). Design specifications precisely state how the contract is
to be performed. Performance specifications as defined in this report specify the
technology to be used and set goals to attaih, but allow flexibility in design.
Types of Contracts Used in the Superfund Program
The different types of contracts used in the Superfund Program are displayed in
Exhibit 2. With firm fixed price contracts, the Government pays a fixed price, which is
established before the award. This price is not subject to adjustment regardless of the
contractor's cost experience; i.e., if the contractor is unfamiliar with cost estimation and
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consents to a fixed price contract at an unrealistically low price, the fixed price of the
contract cannot be adjusted upwards due to the lack of cost estimation experience on the
part of the contractor. Fixed price contracts are usually used when the design or
performance specifications are reasonably definite, and when a fair and reasonable price
can be established at the outset. Fixed price contracts can include lump sums and/or fixed
unit prices. A lump sum contract sets out the total price for completing the work, while
fixed unit prices determine the price paid for individual items (known as partial payments)
procured under the same fixed price contracting vehicle.
Exhibit 2
Types of Contracts Used in the Superfund Program
Fixed Price
Indefinite Delivery/
Indefinite Quantity
Time and Materials
Cost Reimbursement
Cost Plus I
Award Fe
Cost Plus
Fixed Fee!
With indefinite delivery/indefinite quantity (IDIQ) contracts, orders are placed
against the contract after award. These orders, which may be for either supplies or
services,.specify the time and place of delivery, and the quantity to be delivered. IDIQ
contracts provide for a "minimum" and a "maximum" quantity. IDIQ contracts are used
when the exact time or place of delivery, or quantity required, is not known at the time of
contract award. In this way, IDIQ contracts are a subset of fixed unit prices.
With time and materials contracts, the Government pays a fixed rate for each hour
of direct labor worked by the contractor, up to a negotiated ceiling on the total price. In
addition, payments are provided for materials at cost. Indirect costs and profit are included
in the fixed hourly rates. Time and materials contracts are used for engineering and design
services, repair, maintenance or overhaul work, or in emergency situations where there are
generally unforeseen circumstances.
With cost reimbursement contracts, the Government pays for (1) reasonable,
allowable and allocable costs plus a negotiated fixed fee (cost-plus-fixed-fee) or (2)
reasonable, allowable, and allocable costs plus a base fee, that does not vary with
performance, and an award fee based on a subjective Government evaluation of the
contractor's performance. The fixed fee does not vary with actual costs, but may be
adjusted for changes in the work to be performed. Cost-plus-fixed-fee contracts are used
when the performance desired cannot be clearly specified, and when accurate cost estimates
are impossible.
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Contracting Options
Exhibit 3 illustrates the contracting options available to the Superfund remedial
program. For contracts under $15 million, there are five choices: using the Alternative
Remedial Contracting Strategy (ARCS) contract vehicle, signing a cooperative agreement
with the State to lead the project, signing an: interagency agreement with the U.S. Army
Corps of Engineers (COE), signing an interagency agreement with the Department of the
Interior's Bureau of Reclamation, or using a: site-specific contract. ARCS contracts include
remedial design of the selected remedial alternatives and award of remedial action contracts
for purposes of executing the selected remedial action.
Under a State cooperative agreement, EPA can provide funds to States, political
subdivisions, and Indian Tribes to assume responsibility as lead or support agencies for
response. States may use small purchase procedures for contracts under $25,000. For
contracts over $25,000, States must obtain the award official's approval to use a
procurement method other than the sealed bid method. Negotiated proposals are generally
used when conditions are not appropriate for the use of sealed bids. For contracts over
$25,000, States may procure by noncompetitive proposals only when the award of a
contract is not feasible under sealed bids or negotiated proposals, and a circumstance exists
•which would justify a sole source procurement. It is illegal for States to award cost-plus-
percentage-of-cost contracts. Time and materials contracts may only be used if no other
type of contract is suitable, and if the contract includes a ceiling price that the contractor
exceeds at its own risk.
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Under an EPA interagency agreement, the COE or Bureau of Reclamation becomes
involved after the ^Record of Decision (ROD|) is signed, and manages the procurement of
prime conn-acts and subcontracts in order to iclean up a site. The COE or Bureau of
Reclamation can supervise the remedial design or a design may be provided from EPA. •
The COE or Bureau of.Reclamarion can also supervise remedial construction work of these
contractors.
In addition to standard, competitively bid contracts, the COE also has preplaced "
remedial action (PRA) contracts and rapid response (RR) contracts at their disposal.- These
contracts expedite the procurement process because the solicitation is released only to
prequalified bidders. PRA contracts are cost-plus-fixed-fee contracts with a total value of
$50 million per contract with no delivery order dollar maximum. RR contracts are cost-
plus-award-fee contracts with a total value of $50 million per contract, with a $2 million
limit per delivery order. The delivery orders issued under a PRA or RR contract may be
placed on a fixed price, time and materials, or cost reimbursement basis. While the PRA
and RR basic contracts were competitively bid, the individual delivery orders are hot. For
this reason, a remedial action initiated under a PRA or RR contract may cost slightly more
than an individually procured, competitively bid, site-specific contract. COE administration
and management of these contracts is more labor intensive, thereby raising the contract
administration costs. To recover these costs; a small contract utilization fee is applied to
delivery orders in addition to and included iri the COE contract management support costs
for the specific Interagency Agreement. This fee applies to the initial delivery order and
any modification exceeding $250,000 and amounts to less, than one half of one percent of
the delivery order or change order cost. The advantage of these contracts is that the
contract is awarded to a bidder that has been prequalified to do the work, and it takes less
time to procure a technology through a PRA or RR contract than through a standard,
competitively bid contract.
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Exhibit 3
Contracting Options
r
EPA
1
J
Contract Under $15 Million
Contract Over $15 Million
Site-
Specific
Contracts
State
Cooperative j
Agreement
Bureau of
Reclamation
Interagency
Agreement
Contracts
Bureau of
Reclamation
Interagency
Agreement
Contracts
Preplaced
Remedial
Action
Contracts
Contracts
Rapid
Response
Contracts
Contracts
Key:
ARCS: Alternative Remedial Contracting Strategy
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Another option available is the use of a site-specific contract. These contracts are
awarded by the EPA CO for the purpose of obtaining specific cleanup services at a
designated site. Under a site-specific contract, EPA competitively solicits and awards the
cleanup services to a specific contractor rather than utilizing the ARCS contracting vehicle.
Under a site-specific contract, EPA takes the work on a site and bids the work directly out
to a contractor instead of using the ARCS contracting vehicle, signing an interagency
agreement with the COE or Bureau of Reclamation, or signing a cooperative agreement
with a State. The goal of these contracts is to obtain the least cost for the Government in
those situations where the time for competition is available. In order to help reduce the
necessary lead time, a strategy of technically pre-qualified contractors is currently being
established. So far, this pre-qualification strategy has been applied only to site-specific
removal contracts; however, in theory it can be applied to any type of contract. Under site-
specific contracts, the RPM is responsible for writing the statement of work, organizing
any necessary technical evaluation of the offerers, and serving as a project officer on the
contract. The CO is responsible for managing the advertisement, reviewing the bids or
proposals, conducting negotiations, and awarding the contract.
If the contract is anticipated to be greater than $15 million, EPA still has the option
of signing a cooperative agreement with the 'State to lead the project. However, if the
project is to remain under Federal lead, the contract must be managed by the COE or the
Bureau of Reclamation. 1
A number of different contracting mechanisms have been used to procure
innovative technologies. Once EPA signs a 'contract, interagency agreement, or cooperative
agreement with the prime contractor (the COE, an ARCS firm, a State, or the Bureau of
Reclamation), the prime contractor can either provide the innovative technology, or hire a»
construction company. Large construction companies tend to subcontract with a vendor for
the specific innovative technology needed at a site; however, the construction company
.could itself provide the innovative technology. ,
Bonding Requirements for
Construction and Service Contracts - ,; ,
Bonds are written instruments executed by a bidder or contractor (the principal),
and a second party (the surety or sureties), to assure fulfillment of the principal's
obligations to a third party (the obligee or Government), identified in the bond. If the
principal's obligations are not met, the bond( assures payment, to the extent stipulated, of
any loss sustained by the obligee. The most commonly used types of bonds include:
• Bid bond: A bond which assures that the bidder will not withdraw a bid
within the period specified for acceptance, and will furnish required bonds
within the time specified in the bid.
• Payment bond: A bond which assures payments as required by law to all
persons supplying labor or material in the performance of the work
provided for in the contract.
• Performance bond: A bond which secures performance and fulfillment of
the contractor's obligations under the contract.
The Miller Act (40 U.S.C. 270a- 270f) requires performance and payment bonds
for any construction contract exceeding $25,000. This requirement may be waived (1) by
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the Contracting Officer for as much of the work as is to be performed in a foreign country
upon finding that it is impracticable for the contractor to furnish such bond, or (2) as
otherwise authorized by the Miller Act or other law. The contractor is required to furnish
all bonds, including any necessary reinsurance agreements, before receiving a notice to
proceed with the work or being allowed to start work. Under the Miller Act, the
Contracting Officer may reduce the amount of the performance bond based upon the risk to
the Government.
For service contracts, or any contracts other than construction contracts,
performance and payment bonds are generally not required. However, if it is determined
by the CO that a service contract contains elements of construction activity that are
substantial enough to be segregated from the overall contract, two separate contracts must
be awarded -- one for the service work and one for the construction work If the
construction activity exceeds $25,000, the Miller Act applies to the construction contract,
and the CO must make a determination as to the required level of bonding. For further
information, please refer to "Superfund Guidance on the Applicability and Incorporation of
the Davis Bacon Act/Service Contract Act and Related Bonding."
Performance bonds may be required when necessary to protect the Government's
interest. Payment bonds are required only when a performance bond is required and if the
use of a payment bond is in the Government's interest. If it is determined that performance
and payment bonds are needed for a non-construction contract, the contractor must furnish
all bonds before receiving a Notice To Proceed with the work. In addition, no bond shall
be required after the contract has been awarded if it was not specifically required in the
contract, except as may be determined necessary for a contract modification.
Progress Payments
Progress payments, based on a percentage of work completed or stage of
completion, are authorized for use as a payment method for contracts or subcontracts for
construction. For all other fixed price contracts, progress payment provisions are based on
costs, except if authorized by EPA's Procurement and Contracts Management Division.
Liquidated Damages
Liquidated damages are usually assessed on a per-day basis for failure to deliver
hardware or supplies. Liquidated damages have to reflect actual loss or damages from
delay in performance, and can be difficult to apply unless they can be exactly specified
Therefore, they are usually not used for services.
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CHAPTER III
PRIOR EFFORTS TO FACILITATE THE PROCUREMENT
OF INNOVATIVE TECHNOLOGIES
This chapter presents the previous efforts of EPA's Procurement and Contracts
Management Division (PCMD) to address procurement issues affecting the acquisition of
innovative technologies.
The Management Review of the Superfund Program (the "90 Day Study"), as it
relates to innovative technologies, revealed that current implementation of the Federal
Acquisition Regulations (FAR) decreases the flexibility of the Superfund program in
procuring innovative treatment technologies. Items #36A and #36B identified specific
constraints to the procurement of innovative technologies, and suggested solutions to these
constraints. Item #36B is discussed first, since the report which responded to this item
was the first to be released.
Constraints to Treatability Testing
Item #36B of the 90 Day Study found that the primary issue with respect to
procedures to permit greater flexibility in performing treatability studies is the reluctance of
contractors to sell patent rights or offer licensing agreements to other vendors, including
EPA contractors. The 90 Day Study recommended that procedures be developed to permit
more flexibility in conducting treatability studies and in defining "proprietary" technologies
for the purposes of these regulations.
In an effort to implement this recommendation, PCMD convened a workgroup of
EPA personnel. This workgroup published a report in February 1989 entitled,
"Procedures to Permit Greater Flexibility in Performing Treatability Tests,'1 which further
developed the findings in the 90 Day Study, and identified the steps to be taken in order to
implement recommendation #36B. A Memorandum of Understanding was signed by the'
Director of PCMD and the Director of EPA's Office of Emergency and Remedial Response
in August 1990. This Memorandum of Understanding defined responsibilities and .
procedures on the use of basic ordering agreements (BOAs) for the procurement of
treatment technologies. A BOA is a written agreement of understanding (which is not a
contract) that contains the terms and clauses which will apply to future contracts between
EPA and the vendor. The use of BOAs is designed to address the problem of obtaining
license rights to treatment technologies by establishing the terms and clauses that will apply
to future contracts between the owner of a treatment technology and EPA or contractors
operating on EPA's behalf. Although a BOA is not itself a contract and does not obligate
the Government to make any purchases, by entering into a BOA the owner of a treatment
technology indicates a willingness to later contract with EPA or contractors acting on
EPA's behalf.
Constraints on Contractors
Item #36A of the 90 Day Study examined FAR section 36.02 requiring special EPA
approval when the contract for construction of a project is to be awarded to the same firm
that designed the project in order to avoid inherent conflicts of interest. As a result, it was
found that many companies were reluctant to participate in treatability tests if their
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participation would preclude them from later bidding on the construction contract. The 90
Day Study recommended'that EPAmodify the EPA Acquisition Regulations (EPAAR) to
clarify the applicability of FAR constraints related to contractors conducting treatability
tests.
In an effort to implement this recommendation, PCMD once again convened a
workgroup of EPA personnel. This workgroup published a report in January 1990
entitled, "Constraints to the Procurement of Treatment Technologies," which further
developed the findings in the 90 Day Study, and identified the steps to be taken in order to
implement recommendation #36A. On November 27,1990, the EPAAR was amended to
clarify the applicability of the FAR's provisions on construction contracts with architect-
engineer firms regarding their applicability to subcontractors. Under this rule,
subcontractors performing treatability studies will not be prohibited from award on the
construction of a project. Other subcontractors will also not be prohibited from award on
the construction of a project unless their work substantially affects the course of the design.
For prime contractors, and subcontractors whose input substantially affects the course of
the design work, approval by the Responsible Associate Director in PCMD is necessary
before they may be awarded the construction contract.
• _ The workgroup also found that the "Limitations on Future Contracting" clause
which is included in many contracts restricts a contractor from working for both EPA and a
responsible party at the same site. While this policy is designed to prevent conflicts of
interest, it is not designed to preclude responsible parties automatically from using EPA
contractors that perform treatability tests. This is especially true at sites where there is a
cooperative effort between EPA and responsible parties. As a result of this finding, the
EPA Contracting Officer (CO) is now permitted to waive the requirements of the
"Limitations on Future Contracting" contract iclause for contractors working for Jboth EPA
and a responsible party at the same site.
12
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CHAPTER IV
SUMMARY OF FINDINGS
This chapter presents the key points and issues raised in the interviews with RPMs,
COs, and COE personnel on the procurement of innovative technologies at remedial sites.
The Fixed Price Procurement Process
While many respondents indicated that the fixed price contracts were rigid and not
as flexible in procuring innovative technologies, every respondent indicated that a fixed
price contract was used at their site to procure the technology. It was noted that the key to a
successful fixed price contract is a good specification package which minimizes change
orders. Moreover, those contracts which incorporated performance specifications and/or a
combination of lump sums and fixed unit prices for work that was still undetermined, were
able to incorporate flexibility into the fixed price procurement process without sacrificing
the protection against risk which fixed price contracts afford. Unit pricing works well
because as additional volumes (than previously estimated) are added, the unit pricing can be
applied to the new volumes. However, if the quantity varies significantly from the contract
estimate, it may be beneficial to negotiate a change of the unit price for that line item. Unit
prices were used for such items as excavation, clearing, backfilling, well installation and
•treatment. Excavation and treatment were most often based on cubic yards, and not on
weight due to problems in weighing soil.
EPAAR Clarification
FAR section 36.02 requires special EPA approval when the contract for
construction of a project is to be awarded to the same firm that designed the project in order
to avoid inherent conflicts of interest. As a result, it was found that many companies were
reluctant to participate in treatability tests if their participation would preclude them from
later bidding on the construction contract. It was found that many EPA RPMs, COs, and
COE personnel were unaware of the modification to the EPA Acquisition Regulations
(EPAAR) which clarifies the applicability of EAR constraints related to contractors
conducting treatability tests. In addition, while most EPA and COE personnel were under
the impression that this EPAAR clarification does not apply to procurements led by the
COE, one COE respondent indicated that the COE has language similar to the EPAAR
clarification which allows the FAR restriction to be interpreted to allow subcontractors who
perfprm treatability tests during the remedial design to bid on the remedial construction.
Some of those interviewed found the clarification to be confusing. Others indicated that
they never considered that those involved with treatability studies, other than primes and
their pool subcontractors, could not bid on remedial action work.
Contract Clauses
Including a clause which indicates that the contract can be terminated for
convenience if the contractor's pilot test fails ensures that payment will not be made for a
technology that fails to work on the site.
Providing for optional years in a service contract can avoid reprocurement in the
future. In addition, it was noted that contract ceilings should be high enough to cover the
13
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total amount of waste that could possibly be found:at the site. For construction contracts,
contract modifications can be used to avoid future reprocurements.
Service Contracts
The Davis-Bacon Act and the Service Contract Act require that all work be analyzed
to determine which elements are construction and which are service. The contract is then
awarded based upon the preponderance of the work. Most remedial action contracts are a
combination of service and construction work. Since most remedial action treatment work
can be considered service work, much of this work can be accomplished by using a service
contract. Since there are differences in payment rates and bonding when a service contract
is used instead of a construction contract, these differences should be taken into account in
the procurement and in the management of the contract.
Records of Decision
It was noted that specifying the exact brand of an innovative technology to be used
as the remedy for a site in the ROD can create problems with receiving adequate
competition and obtaining a good price. It was noted that it is a good idea to make the
remedy in the ROD general if a treatabilityi study has not been completed, if a patent is
under question, or if there is uncertainty as to whether the technology will work on the site.
It was noted that it is a good idea to make the remedy in the ROD specific (even to the point
of specifying the specific type of technology system) if it is certain that this system is die
only one that can successfully perform the work at the site. It was also noted that it is a
good idea to identify an established technology as a contingent remedy in the ROD if an
innovative technology is identified as the remedy, in order to alleviate community and State
concerns, and to avoid having to formally amend the ROD if a change in technologies is
needed.
Pre-Award Surveys
Pre-award surveys are evaluations by a surveying activity of a prospective
contractor's capability to perform a proposed contract. Pre-award surveys can be of use in
determining the responsibility of the low bidder or selected offerer. These surveys are
completed before the award of the contract, and are used to determine the financial
capability as well as the physical and technical resources of the low bidder or selected
offerer. I
Specifications
The procurement of innovative technologies worked the best in situations where
performance specifications were used. Since performance specifications specify the
cleanup goals without specifying exactly how the site is to be cleaned up, EPA has to pay
for only what is cleaned up to these performance standards. Performance specifications are
especially good to use when dealing with proprietary processes and/or materials, because
corporations will not have to release their proprietary designs.
Clarity in Solicitation Package
^
It was noted that it is extremely important to ensure that the solicitation package is
clear in order to avoid problems and protests later. Any special requirements or clauses
should be carefully worded and highlighted. ,
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Limitations on Future Contracting Clause
It should be noted that, while the EPA CO can waive the "Limitations on Future
Contracting Clause," there may be situations where the CO does not believe it is
appropriate to waive this clause at a particular site. Since this clause does not allow a
vendor to contract with a potentially responsible party in the same EPA region, this will
limit the number of bids received, even if there are no viable PRPs at the specific site.
Patent Issues
It was learned that it is important to investigate patent issues before soliciting bids,
and to involve the CO early in the process if patent problems are anticipated. The RFP/IFB
should point out that the technology is patented, and how this issue will be handled in the
procurement. If a Waiver of Indemnity Clause is included in the contract, the Government
bears the liability if a patent is accidentally infringed upon.
Several sites ran into difficulties when subcontractors or vendors were switched
and this change affected the results of the treatment on the site. This is especially
problematic with technologies which are patented. One contractor had specified a
subcontractor holding the patent to a process proven effective through testing at the site in
their bid but had no binding agreement. Once the award was made, the two companies
"could not come to an agreement and an alternate process had to be used, which created
difficulties with the final treated material. • Another site which also has tested a patented
technology which proved to be effective at their site has made the decision to procure the
innovative technology through a sole source agreement through a State Cooperative
Agreement and to competitively procure any other necessary work at the site (e.g.,
excavation or construction). This will require two contractors to work closely together.
Treatability Testing
It was noted that treatability studies should also be completed in the remedial
investigation/feasibility study phase or the remedial design phase in order to avoid
problems with nonperformance later. Several RFPs/IFBs required a demonstration that the
technology would be effective at the site. This has resulted in bidders performing
treatability studies at their own expense prior to bidding on the site. One bid request
required a pilot study to be performed prior to implementation of the technology at the site,
with conditions of successful performance for payment of the pilot study.
State-Lead Procurements
1$
It was noted that State-lead procurements take longer to complete, and are 'difficult
in that EPA does not have direct control of the site, but is still ultimately responsible for the
cleanup of the site. While State-lead procurements do not follow the Federal Acquisition
Regulations, section 35.6595 of the Code of Federal Regulations ("Contract Provisions of
Subpart O") lists required flow-down clauses and provisions for State contracts.
COE-Lead Procurements
While COE preplaced contracts facilitate the procurement of innovative technologies
through prequalification, COE administration and management of these contracts is more
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labor intensive. The labor intensive nature of these contracts raises COE's contract
administration costs. • .
Contractor Experience
Some technologies have a limited|number of vendors which are qualified to bid on
the RFP/IFB for an innovative technology. Therefore, there is a possibility that bids from
unqualified vendors will be received. AIL qualifications should be stated in the solicitation.
Deviation^ from the EPAAR
i
It is possible to obtain a deviation !from the EPAAR for a particular procurement.
The request for deviation must be submitted to the Director of EPA's Procurement and
Contracts Management Division for approval. The request should cite the specific part of
the EPAAR from which a deviation is requested, the nature of the deviation, and a
justification for the deviation. The CO at 'one removal site indicated that a deviation from
the EPAAR was obtained which allowed a negotiated procurement without submittal of
technical proposals. The EPAAR has since been changed to allow this for fixed price
contracts without a deviation.
Bonding Issues
If the contractor pledges private assets in lieu of obtaining a bond from a bonding
company, each asset must be evaluated, which will lengthen the procurement process.
Contractors cannot be required to obtain bonds from bonding companies, and are allowed
to pledge private assets to meet contractual bonding requirements. Although the contractor
is not required to pledge bonds through a1 surety, the actual amount and means of pledging
the bond must be acceptable to the CO prior to award of the contract. The CO must make a
.-determination based upon, and consistent with, the type of contract,, the estimated cost and
the associated risk, and balance these against the need to protect the Government's interest.
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CHAPTER V
REMEDIAL SITE EXPERIENCES WITH
PROCURING INNOVATIVE TECHNOLOGIES
This chapter describes the experiences of remedial sites that have either begun or
completed the procurement of an innovative technology. The EPA and COE Project
Managers and Contracting Officers who were involved in the procurement at these sites are
pioneers both in the use and procurement of innovative treatment technologies. Their
experience will help regions avoid delays in future contracting for treatment technologies
and educate EPA management on the difficulties encountered and what procurement
methods actually worked best. A summary of the information on each site is presented in
both a narrative and a tabular format. The chapter is organized by type of innovative
technology; it presents first a description of the technology and then the experiences at sites
where that technology was procured.
BIOREMEDIATION
Description of Technology
Bioremediation technologies involve enhancing biodegradation of contaminants
through the stimulation of indigenous soil a'nd groundwater microbial populations or the
addition of proprietary, natural microbial species. Natural biodegradative processes are
enhanced by optimizing conditions necessary for microbes to grow and complete metabolic
processes. Bioremediation is applicable only for treating organic contaminants.
Contaminants chosen for treatment include BTEX, PAHs, PCP, chlorinated organics,
phenols, and pesticides.
.Special Contracting Needs
Excavation and stockpiling of soil, and construction of a land treatment unit
can be completed with a construction contract. Operation of the land
treatment unit and the biodegradation process can be completed with a
service contract.
• Land treatment technologies work well when vendors are experienced;
however, it takes time for vendors to establish a track record.
Old Inger Oil Refinery
A bioremediation (land treatment) technology is being procured at the Old Inger Oil
Refinery remedial site (EPA Region 6) under an EPA cooperative agreement with the State
of Louisiana. The procurement for construction of the land treatment unit began in
November 1988 and was completed five months later in January 1989. The procurement
for the operation of the land treatment unit was planned to begin in December 1991.
17
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oo
SITE INFORMATION
Site:
Old Inger Oil Refinery
Louisiana
Region 8
Contact:
Mr. Paul Sieminski
RPM
(214)655-6710
(FTS) 655-6710
Ms. Sandra Greenwich
State of Louisiana
(504) 765-0487
Technology:
Bioremediation
(Land Treatment)
CONTRACT INFORMATION
Procurement Lead: State of Louisiana under EPA cooperative agreement
Contractors): Westinghouse - HAZTECH
Procurement Started/Completed: Construction of land treatment unit: 9/88-1/89 (5 months)
Operation of land treatment unit: Planned start December 1991
Number of Bids: 5
Phase of Procurement: Procurement for construction phase is completed; procurement for operation of
land treatment unit is in presolicitation phase
Method of Solicitation: Sealed bid for construction; undecided for operation
Type of Contract: Combination of fixed price and lump sum. Lump sums used for mobilization,
demobilization, and construction. Unit prices were used per cubic yard for excavation. .
Protests/Claims: None
Change Orders: Differing site conditions raised the contractor's prices from the initial estimate.
Special Clauses Used in RFP/IFB/Contract: None
Bonding Requirements: Bonding required for construction
Patent Issues: None :
Prequalified Bidders: No
Type of Specifications: Design specifications for construction; performance specifications for operation
Sole Source Issues: Not applicable, competitive procurement
Treatability Studies: Completed as part of the design
EXPERIENCES ENCOUNTERED
RESOLUTION/
OUTCOME
WHAT WORKED WELL/ADVICE
•Amount of time it took the contractor to
provide cost documentation was problematic.
•Old Inger was one of the first sites at which
land treatment was attempted. It was not
realized that a no migration petition needed
to be completed until after the design was
completed.
• Waiting for the cost
documentation
slowed down the
procurement.
• Completing the no
migration petition also
slowed down the
procurement.
•Where there are uncertainties in the extent of
contamination, it works well to use unit prices per cubic
yard.
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Westinghouse — HAZTECH is the contractor constructing the land treatment unit.
The contract for the land treatment unit was procured through sealed bids. A fixed price
contract was used, which included both lump sums for mobilization, demobilization, and
construction; and, fixed unit prices (per cubic yard) for excavation. Design specifications
were used in the construction contract, and performance specifications will be used in the
contract for operation of the land treatment unit.
Differing site conditions raised the contractor's price from the initial estimate.
Initially, it took the contractor an unanticipated amount of time to provide cost
documentation, which slowed the procurement. Using unit prices per cubic yard worked
well at this site, since there was uncertainty as to the extent of the contamination, and unit
prices could be applied to the new volumes.
In addition, Old Inger was one of the first sites at which land treatment was
attempted. It was not realized that a no migration petition needed to be completed until after
the design was completed. A no migration variance allows land disposal of restricted
wastes not meeting the land disposal restrictions treatment standards in a specific unit.
Completing the no migration petition also slowed down the procurement, because to obtain
a no migration variance, site managers must demonstrate to a reasonable degree of certainty
that there will be no migration of hazardous constituents from the disposal unit or injection
zone for as long as the waste remains hazardous.
THERMAL DESORPTION
Description of Technology
Thermal desorption technologies consist of varied processes that vaporize volatile
and semi-volatile organics from soil and sludge. These processes are designed to avoid
combustion of the contaminants in the soil and sludges. After desorption, the volatized
organics may be subsequently treated in an afterburner or condensed for reuse or
destruction. '
Special Contracting Needs
Special contracting needs to be considered in procuring a thermal desorption
technology include:
» Many different thermal desorption technologies are available.
One type of thermal desorption technology, the "hot oil thermal screw"
technology, is patented. However, the Federal Government has the rights
to use this technology since the Government provided the patent holder with
the research and development funds to develop this technology.
• The thermal desorption treatment process can be acquired with a service
contract, while the other work at the site (such as excavating, building
roads, pads, etc.) can be acquired with a construction contract.
Lipari Landfill
Remediation services for Operable Unit 3 (OU3) of the Lipari Landfill cleanup in
New Jersey (EPA Region 2) will be competitively procured by the U.S. Army Corps of
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SITE INFORMATION
Site:
Lipari Landfill
(Operable Unit 3)
New Jersey
Region 2
Contact:
Mr. Thomas Graff (COE)
Project Manager
(816)426-5832
Ms. Joanne Chapman (COE)
Contract Specialist
(816)426-5832
Technology:
Thermal Desorption
(Low Temperature)
CONTRACT INFORMATION
Procurement Lead: U.S. Army Corps of Engineers
Contractor(s): Contractor(s) not yet selected
Procurement Started/Completed: A six month procurement time frame is anticipated
Number of Bids: Not applicable, in presolicitation phase •
Phase of Procurement: Presolicitation
Method of Solicitation: Competitive 2-step invitation for bid is anticipated
Type of Contract: Fixed unit price and lump sum; construction and service
Protests/Claims: Not applicable, in presolicitation phase
Change Orders: Not applicable, in presolicitation phase x
Technical Requirements in RFP/IFB/Contract: Anticipate requiring: (1) minimum daily production rate; (2)
temperature constraints to maintain "low temperature"; (3) type of treatment and equipment to be used; (4) length of
availability of equipment; (5) due to limited space on site, will specify equipment size.
Bonding Requirements: Will require bonding on portion of work that is under a construction contract. Service
contract work will not need bonding.
Patent Issues: While some thermal desorption technologies are patented, no patent issues are anticipated
Prequalified Bidders: Not applicable, in presolicitation phase
Type of Specifications: Performance
Sole Source Issues: Not applicable, competitive procurement
EXPERIENCES ENCOUNTERED
RESOLUTION/
OUTCOME
WHAT WORKED WELL/ADVICE
• Potential problem with not allowing bidders to conduct
bench scale studies.
• When ROD was written, it specified that rotary kiln
thermal treatment should be used and indicated the
temperature constraints associated with the rotary kiln
technology. Since the ROD was written, the thermal
treatment technology has further developed, and the
ROD is constraining the potential number of bidders.
1 COE is doing a bench scale
study through a research
company, and will release
the results to potential
bidders.
• EPA is writing an
Explanation of Significant
Differences to allow bids on
any type of thermal
treatment, and to expand
the temperature range.
• For thermal desorption, state in the ROD the generic term for the
technology. Do not be specific in order to encourage as many vendors
as possible to bid on the contract.
• Use performance specifications in contracts for innovative technologies
in order to give contractors flexibility.
• Use unit prices for cost per ton of treating soil and for cost per cubic yard
of excavation and restoration.
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Engineers (COE). OU3, which is in remedial design, will involve the use of low .
temperature thermal desorption to process soil that will be excavated from a contaminated
marsh. The COE is developing a contract acquisition plan that will outline the appropriate
contracting mechanism and justification. The COE anticipates issuing a Two-Step
Invitation for Bid (IFB) in February 1992. The procurement is scheduled to be completed
within six months or by July 1992.
When the ROD was written in July 1988, it specified that a specific type of thermal
treatment known as rotary kiln would be used and noted the corresponding temperature
constraints. However, since the ROD was written, thermal desorption technology has
developed further and the original temperature constraints and limitation to a specific type
of thermal treatment are no longer applicable. To correct this situation, EPA is writing an
Explanation of Significant Differences to permit bids on any type of thermal treatment, and
to expand temperature constraints.
COE is anticipating problems with the procurement of the thermal desorption
technology. The cleanup criteria allow the contractor to specify the specific type of thermal
desorption treatment to be used on the site. However, logistical, legal, and timing concerns
will prevent samples from being released for bench scale testing. Bench scale tests are
being conducted through a research company who will release the results of this test to
potential bidders. The bidders will not be able to conduct their own treatability studies.
In an effort to avoid additional potential problems, COE intends to use performance
specifications, which will give the contractor the flexibility to make equipment adjustments
to meet cleanup goals. COE plans to use unit prices for the cost per ton of treating the soil
through thermal desorption, and cost per cubic yard for the cost of excavation and,
restoration and analytical services. The remainder of the work will be paid for qn a lump t
sum basis.
VACUUM EXTRACTION
Description of Technology
The vacuum extraction system utilizes a series of extraction wells to create air flows
through the vadose zone and induce the volatilization of chemicals from soil and pore
water. The vapor-laden air is withdrawn often with entrained water, by application of a
vacuum at the recovery well. The contaminated air is then treated using an emission control
system, such as activated carbon or catalytic oxidation. The process is generally applicable
to volatile and moderately volatile organic compounds. This technology is also applicable
for removal of volatile light non-aqueous phase liquids floating on the water table or
entrained on the capillary fringe. This process is limited to volatile compounds. . • •
Special Contracting Needs,
Special contracting needs to be considered in procuring a vacuum extraction
technology include:
• Treatment can take years and it is difficult to predict when final clean-up will
occur.
• Vacuum extraction process is patented.
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» Treatment operation is a service. Installation of wells and equipment is
construction.
« Non-qualified bidders are a potential problem. The RFP/IFB should
specify that the contractor have prior experience in using this technology.
Verona Well Field
Procurement of vacuum extraction (soil vapor extraction) at the Verona Well Field
site in Michigan (EPA Region 5) began in March of 1987 and ended seven months later in
September. CH2M Hill was the ARCS prime contractor who subcontracted with Terra Vac
for the vacuum extraction technology. This technology was competitively procured
through a Two-Step IFB.
The contract took three months longer to be awarded than originally anticipated
because the State of Michigan and the community were hesitant about using soil vapor
extraction on the site. The community preferred incineration; however, due to the high
levels of contamination on the site, incineration was not a feasible option. Although the
community initially supported using soil vapor extraction, after the IFB was released, the
community pulled back its support for the use of this technology and EPA had to negotiate
for several months. Once EPA agreed tq perform extensive sampling to ensure that the
technology would work, the community was persuaded to allow the use of soil vapor
extraction on the site. It was learned that| it is important to identify a contingent remedy in
the ROD when an innovative technology I is selected as the remedy in the ROD so that the
community will know the option available if the selected remedy is unsuccessful.
The IFB required a demonstration that the technology would be effective at the site.
In order to meet this requirement, Terra Vac did a pilot study after the contract was
awarded. This avoided future problems because the technology was proven to work on a
small scale before it was implemented on a large scale.
Both performance and design specifications were used in the contract. Design
specifications were used for construction^, excavation, and tank removal. Performance
specifications were used for the cleanup goals which Terra Vac had to reach in using the
soil vapor extraction technology-design ^specifications could not be used for the innovative
technology since a lot of Terra Vac's design work is proprietary. It was learned that
performance specifications are especially good to use when a technology or components of
a technology are considered proprietary by a contractor.
Another problem encountered in |the procurement process involved indemnification.
Terra Vac did not have the insurance that it needed to perform the soil vapor-extraction
technology on the site. Eventually, EPA igave Terra Vac a special case indemnification
which allowed them to do the work.
Terra Vac had difficulty acquiring a performance bond which they were required to
•submit. After a lengthy period of time they were able to obtain a letter of credit from a
bank.
In September of 1990, the contract was switched from a Remedial Planning (REM)
IV contract to an Alternative Remedial Contracting Strategy (ARCS) contract. Since there
are different requirements under ARCS, CH2M Hill rebid the subcontract/ When the
subcontract was rebid under ARCS, CH^M Hill wrote a sole source justification for Terra
22
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SITE INFORMATION
N)
U>
Site:
Verona We!! Fisid
Michigan
Region 5
Contact:
Ms. Margaret Guerriero
RPM
(312)886-0399
(FTS) 886-0399
Technology:
Vacuum Extraction
(Soil Vapor Extraction)
CONTRACT INFORMATION
Procurement Lead: Subcontract through REM contract I
Contractors): ARCS: CH2M HILL; Subcontract: Terra Vac
Procurement Started/Completed: 3/87-9/87 (7 months)
Number of Bids: 4 bids received on initial procurement; sole source justification when REM switched to
ARCS
Phase of Procurement: Contract Administration
Method of Solicitation: Competitive, 2-Step IFB; sole source when REM IV switched to ARCS
Type of Contract: Fixed unit price and lump sum
Protests/Claims: None
Change Orders: (Information unavailable)
Special Clauses Used in RFP/IFB/Contract: None
Bonding Requirements: Performance bond
Patent Issues: Terra Vac holds patent on vacuum extraction
Prequalified Bidders: Yes (informally)
Type of Specifications: Both performance and design
Sole Source Issues: Not applicable, competitive procurement
EXPERIENCES ENCOUNTERED
RESOLUTION/
OUTCOME
WHAT WORKED WELL/ADVICE
•After the contract was awarded and work had
begun, the contracting vehicle for site
remediation changed from REM IV to ARCS.
This required the subcontract to be
renegotiated.
•Terra Vac did not have the necessary
insurance to perform soil vapor extraction on
the site.
•After the IFB was released, the community and
the State became concerned that soil vapor
extraction would not be effective. This concern
delayed the procurement for three months.
• When the subcontract was
rebid, the prime contractor
wrote a sole source
justification for Terra Vac
to continue work.
• EPA gave Terra Vac a
special case
indemnification.
EPA performed extra
sampling to ensure
effectiveness of
technology.
• Use a unit price contract with extra year options.
This will eliminate the need for future procurements
if the clean-up takes longer than anticipated.
• In the IFB, require that bidders demonstrate that the
technology will be effective at the site.
• Use design specifications for construction and
excavation, and use performance specifications for
the vacuum extraction treatment. Performance
specifications are especially good to use when a
technology or components of a technology are
considered proprietary by a contractor.
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Vac to continue the work. This transition from a REMIV to an ARCS contract proceeded
smoothly since CH2M had anticipated the change.
The contract pays on the basis of the amount of work performed through unit
prices, and the contract also provides for optional years to anticipate the need for further
procurements in the future. This has enabled EPA to easily negotiate additional work, and
has afforded protection from price escalation.
Commencement Bav. Well 12-A
At the Commencement Bay, South Tacoma Channel, Well 12-A, Operable Unit
One site in Oregon (EPA Region 10), a vacuum extraction technology was procured
through the U.S. Army Corps of Engineers (COE). The COE used a preplaced contract to
acquire this technology, and the procurement began in November 1988 and ended one
month later in December 1988 (see Chapter II for a discussion of preplaced contracts). For
this procurement, three sealed bids were received from the pool of prequalified contractors
who only needed to submit a one page bid which indicated their price for the work to be
done at the site. The COE preplaced contractor who won the contract was Hunter-ES&E
(Gainesville), and the subcontractor was AWD. Preplaced contracts worked well for
procuring vacuum extraction; however, they are more labor intensive than contracts which
are not procured through the preplaced prequalification process. The labor intensive nature
of these contracts raises COE's contract administration costs. Prequalification reduces the
probability of receiving bids from nonqualified bidders. Although the procurement took
only one month, several months elapsed between EPA's procurement request and the
release of the solicitation.
The most significant difficulty encountered in acquiring the vacuum extraction
technology at this site related to patent rights. The patent is held by the President of Terra
Vac. Terra Vac is fully licensed under the patent to use and market vacuum extraction;
most other companies using the technology, including AWD, are not licensed. The
company holding the patent on vacuum extraction (Terra Vac) claimed that it is entitled to
15 percent of all site-related payments. However, the site costs which are most directly
related to the vacuum extraction technology are those associated with the remedial action
construction payments. Moreover, the cost effectiveness of using vacuum extraction is
quickly lost if 15 percent of all site-related payments are paid to the patent holder.
In order to avoid limiting the competition as a result of the patent claim, the IFB
included a patent infringement clause which informed the bidders that the Government
would bear the liability for patent infringement at this site. This prompted an effort by EPA
to negotiate patent rights to Terra Vac's process, since this issue affects all sites interested
in procuring a vacuum extraction technology. A COE attorney is negotiating with Terra
Vac on behalf of EPA. EPA is currently in the process of compiling.a proposal to send to
Terra Vac which would give Terra Vac 15 percent of all remedial action construction
payments as opposed to 15 percent of all site-related payments.
24
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SITE INFORMATION
to
Site:
Commencement Bay,
South Tacoma
Channel,
Well 12-A
Washington
Region 10
Contact:
Mr. Kevin Rohlin
RPM
(206)553-2106
(FTS) 553-2106
Technology:
Vacuum Extraction
CONTRACT INFORMATION
Procurement Lead: U.S. Army Corps of Engineers (COE) preplaced contract
Contractor(s): COE Preplaced Contractor: Hunter ES&E; Subcontract: AWD
Procurement Started/Completed: 11/88-12/88 (1 month)
Number of Bids: 3
Phase of Procurement: Contract Administration
Method of Solicitation: Competitive ~ sealed bid to preplaced COE contractors
Type of Contract: Fixed unit price and lump sum
Protests/Claims: None so far
Change Orders: (Information unavailable)
Special Clauses Used in RFP/IFB/Contract: A patent infringement clause was included in the IFB stating
that the Federal Government would bear the liability for patent infringement
Bonding Requirements: Contractor had to obtain a $1 million bond, and show proof of effectiveness
Patent Issues: Terra Vac's patent requires 15% of all site-related payments. COE patent attorney is currently
negotiating nationwide patent rights with Terra Vac on behalf of EPA.
Prequalified Bidders: Bids were solicited from a pool of prequalified contractors under a COE preplaced
contract
Type of Specifications: Design
Sole Source Issues: Not applicable, competitive procurement
EXPERIENCES ENCOUNTERED
RESOLUTION/
OUTCOME
WHAT WORKED WELL/ADVICE
•A fixed price, lump sum contract does not
work well because of changes involved in
implementing the remedial action.
•The design took longer than anticipated to
complete because the first design that was
solicited was inadequate to clean up the site.
•Although the procurement took only one
month, several months elapsed between
EPA's procurement request and the release
of the solicitation.
• Using fixed unit prices
in the contract (since
the total amount of
material to be treated
was unknown) helped
alleviate some of the.
uncertainties.
Second design relied
on a pilot study.
•COE preplaced contracts facilitate procurement of
innovative technologies and keep non-qualified bidders out
of the competition; however, bids are more costly.
• Unit prices are useful when the total amount of material to
be treated is unknown.
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CHEMICAL TREATMENT
(DECHLORINATION)
Description of Technology
Chemical treatment technologies are used to remove hazardous substances from
soils through the application of a chemical, or a combination of chemicals, to the soil. The
most common type of chemical treatment currently in use at Superfund sites is the Alkaline
Metal Hydroxide/Polyethylene Glycol (APEG) dehalogenation technology. The APEG
technology uses glycolate reagent generated from an alkaline metal hydroxide and a glycol
to remove halogens (e.g., chlorine, bromine, fluorine, etc.) from halogenated aromatic
organic compounds in a batch reactor. KPEG (potassium hydroxide/polyethylene glycol)
is the most commonly used type of APEG reagent. Another variation of the reagent is
potassium hydroxide, or sodium hydroxide/tetra-ethylene glycol (ATEG). APEG
processes involve heating and physical mixing of contaminated soils, sludges, or liquids
with the chemical reagents. During the reaction, water vapor and volatile organics are
removed and condensed. Carbon filters are used to trap volatile organic compounds that
are not condensed in the vapor. The treated residue is rinsed to remove reactor by-products
and reagent and then dewatered before disposal. The process results in treated soil and
wash water. APEG processes are potentially effective in detoxifying specific types of
aromatic organic contaminants, particularly dioxins and polychlorinated biphenyls.
Special Contracting Needs
i
• A number of chemical treatment processes are patented.
• Even though there are a number of dechlorination technologies available,
not all may be applicable'to a specific site.
• Treatment of soil using dechlorination is a service. Other activities such as
construction of pads, roads, etc. are construction.
• Nonqualified bidders are a potential problem.
• There are only a small number of vendors who are qualified to perform this
technology.
Wide Beach Development
At the Wide Beach Development remedial site in New York (EPA Region 2), an
APEG dechlorination technology was competitively procured through sealed bids by the
COE as a subcontract through a prime contract. The procurement began in May 1989 and
was completed six months later in October 1989.
The ROD for this site specified that KPEG, a form of the APEG dechlorination
technology, would be used to treat and process contaminated soil at the site. The remedy
selected in the ROD was based on the results of a treatability study performed by Galson
Remediation, the company which holds ;a patent on the KPEG process, during the remedial
design. The prime contractor who won the contract for the remedial action (Kimmins) had
indicated in their bid that Galson would be the subcontractor for the KPEG treatment.
26
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SITE INFORMATION
Site:
Wide Beach
Development
New York
Region 2
Contact:
Mr. Herb King
RPM
(212)264-1129
(FTS) 264-1129
Technology:
Chemical Treatment
(APEG Dechlorination)
CONTRACT INFORMATION
Procurement Lead: U.S. Army Corps of Engineers
Contractor(s): Kimmins; Subcontract: Soil Tech
Procurement Started/Completed: 5/89-10/89 (6 months)
Number of Bids: Two bids, one of which was unresponsive
Phase of Procurement: Contract administration
Method of Solicitation: Initially procured as a sealed bid, then negotiated cost with sole responsive bidder
Type of Contract: Fixed price/lump sum
Protests/Claims: None
Change Orders: Approximately 25
Special Clauses Used in RFP/IFB/Contract: KPEG as the technology to be used at this site
Bonding Requirements: Kimmins pledged private assets
Patent Issues: Many different dechlorination processes are patented technologies
Prequalified Bidders: No
Type of Specifications: Design
Sole Source Issues: Not applicable, competitive procurement
EXPERIENCES ENCOUNTERED
RESOLUTION/OUTCOME
WHAT WORKED WELL/ADVICE
•After the award of the contract,
Kimmins could not reach an
agreement with subcontractor
(Galson) specified in their
proposal for the KPEG
treatment. Kimmins submitted a
value engineering study to have
another contractor (Soil Tech)
use APEG treatment instead.
•When private assets are used
for bonding, each asset has to
be evaluated by the awarding
Agency.
• Since the contract award was based on
original contractor's success with KPEG,
EPA required that a successful
demonstration be run before accepting
Kimmins' value engineering submission.
EPA paid for a successful demonstration.
However, after full-scale implementation,
unanticipated changes occurred in the
soil structure due to the high heat
involved in the substituted process. The
soil was not able to be used as backfill
on-site.
• The COE had to spend considerable time
completing this process for the contract
award.
• The original design was based around a patented
technology. When the contractor could not obtain
the services of the subcontractor in the proposal, an
alternate decholorination process had to be
substituted and the original design was not used. If
performance specifications had been used in the
contract, it would have been easier to make this
substitution.
• Allowing for wider competition or substitution among
dechlorination processes may not be suitable unless
full-scale demonstrations are performed first.
Fixed price, lump sum contracts lead to a lot of
change orders if there are differing site conditions.
-------
However, after the award of the contract, Kimmins could not reach an agreement with
Galson, and submitted a value engineering proposal to have another subcontractor (Soil
Tech) use the more generic chemical treatment, APEG, on thejite.
Since both the remedial design and the award of the contract to Kimmins were
based on Galson's success in treating the soil using KPEG in the treatability study, EPA
required Soil Tech to run a demonstration before the value engineering proposal would be
accepted. EPA would pay for the demonstration'only if the demonstration was successful.
Soil Tech ran a successful demonstration on the site, and the proposal was accepted.
However, since the APEG technology uses a much higher temperature to treat the soil than
the KPEG treatment, the structural characteristics of the soil have been altered, and die soil
can no longer be used to support a road as originally planned. It was learned that it is
important to look not only at how the contaminants are affected, but also at how the soil is
affected by the treatment process. It was|also learned that it is important to do everything
possible during the procurement process to determine whether the prime contractor has
reached agreement with the subcontractor(s) bid in their original proposal.
Specifying KPEG in the IFB reduced the number of bidders. Two bids were
received in response to the IFB; however, one was determined to be unresponsive, since
the vendor did not have the necessary experience with the KPEG technology. Therefore,
the COE wound up negotiating the price !of the work with the sole responsive bidder
(Kimmins). These negotiations were difficult because limited data on the technology
existed which could be compared against the subcontractor's cost and pricing estimates.
The COE did complete their own estimates which were used as a basis for comparison with
the subcontractor's estimates. However,! the COE's estimates and the subcontractor's
estimates were substantially different, anid the subcontractor was required to provide data to
back up their estimates.
i
The subcontract for the KPEG technology was a fixed price, lump sum contract.
However, using this type of contract has iled to the submission of approximately 25 change
orders since the subcontractor claims that site conditions are different than assumed in the
proposal. If the change orders are approved, they would double the cost of the work since
the initial award of the contract. EPA is evaluating these change orders.
The subcontract used design specifications which were based on the Galson KPEG
process; if performance specifications had been used, it would have been easier to made the
transition from the KPEG to the APEG process, and time would not have been lost
completing design specifications that were not used.
Bonding issues were also problematic at this site, in that Kimmins had pledged
private assets for the bond, and the COE iwas required to go through the time consuming
process of evaluating each asset after the contract was awarded. It was learned that
bonding requirements should be discussed with the contractor before the award is made so
that bonding issues will not hold up the rpmedial construction:
CHEMICAL EXTRACTION
(SOLVENT EXTRACTION)
Description of Technology
i
Solvent extraction is a method of separating hazardous organic contaminants from
oily-type wastes, soils, sludges, and sediments using an organic solvent, thereby reducing
28
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the volume of hazardous waste that must be treated. In general, a fluid that preferentially
removes hazardous orgariics is placed in contact with the contaminated media. Chemical
extraction does not destroy wastes, but is generally used as one in a series of unit
operations, and can reduce the overall cost of cleaning up a particular site. The process
separates the waste into three constituent fractions: oil (with organics), solids, and water.
Special Contracting Needs
Several solvent extraction technologies are patented, including CF Systems
and BEST.
Proprietary information may be involved.
Treatment of soils is service work. Other site work may be construction.
United Creosoting
A solvent extraction technology is currently being procured at the United
Creosoting site in Texas (EPA Region 6) through an EPA cooperative agreement with the
State of Texas. The State began the procurement negotiations in April 1991, and is
proceeding with a sole source procurement for the innovative technology. Two separate
procurements are being used - one for the innovative technology, and one for the
remainder of the site work. The non-innovative technology portion of the work on the site
will be competitively bid.
The ROD at this site specified the vendor (CF Systems) for the innovative
technology portion of the work as well as the technology (critical fluid extraction). This
facilitated the procurement since it was previously demonstrated through a pilot study that
- this technology would work on the site, and that CF Systems was the only vendor who
could provide the technology. The ROD specificity avoided opening up the procurement to
other vendors when it was known that other vendors may not be able to successfully
perform the work. However, the RPM at this site stated that it is important to'make the
remedy in the ROD general if a treatability study has not been completed, if a patent is
under question, or if there.is uncertainty as to whether the technology will work on the site.
»
In general, State-lead procurements take longer to complete. The State does not
have to follow the Federal Acquisition Regulations (FAR), and there is less paperwork and
approvals that are required. Instead, States must follow 40 Code of Federal Regulations
Part 35 for procurements under EPA cooperative agreements and their own State
procurement requirements. Since at this site, there is only one vendor who can provide the
needed'service, the State is not required to write a sole source justification.
Patent issues are not expected to arise since CF Systems holds the patent on the
specific type of chemical extraction to be used on this site. Problems would arise only if
other vendors wanted to use this technology. Furthermore, the Government does not
expect to pay royalties since the patent holder is the contractor.
29
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SITE INFORMATION
Site:
United Creosoting
Texas
Region 6
Contact:
Ms. Deborah Griswold
RPM
(214)655-6715
(FTS) 255-6715
Technology:
Critical Fluid Extraction
(Solvent Extraction)
CONTRACT INFORMATION
Procurement Lead: State lead under EPA cooperative agreement
Contractors): CF Systems
Procurement Started/Completed: 4/91-present (sole source negotiations)
Number of Bids: Not yet determined
Phase of Procurement: Presolicitation
Method of Solicitation: Innovative technology procured through sole source arrangement while rest of
project will be procured competitively (planned)
Type of Contract: Anticipate using fixed unit prices
Protests/Claims: None foreseen at this time
Change Orders: Not yet determined
Special Clauses Used in RFP/IFB/Contract: Not yet determined
Bonding Requirements: Not yet determined
Patent Issues: CF Systems holds a patent on their chemical extraction technology
Prequalified Bidders: No
Type of Specifications: Design
Sole Source Issues: ROD specified both the vendor and the technology
EXPERIENCES ENCOUNTERED
RESOLUTION/
OUTCOME
WHAT WORKED WELL/ADVICE
'State-lead procurements appear to take more
time due to a number of factors, including
State administration.
•State commissioners have to authorize funds
for the contract.
• State-lead
procurements are
advantageous in that
States do not have to
follow the FAR.
• Pilot study was done at the site using CF Systems' solvent
extraction and therefore it was specified by name in the
ROD. Being specific when a technology is known to work at
a site makes it easier to perform a sole source procurement.
•Sole source procurements must go through a price analysis
to ensure that the government is not overcharged.
• It is anticipated that total work at site will be done through
two separate procurements. One will be sole source to CF
Systems, and the other will be a competitive bid for
construction work to be done at the site.
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Pinette's Salvage Yard
At the Pinette's Salvage Yard site in Maine (EPA Region 1), a solvent extraction
technology was competitively procured as a subcontract through the ARCS contractor
(EBASCO). The initial procurement began in April 1990 and was completed six months
later in October 1990. Sevenson Environmental Services is the subcontractor and GET
Sanivan Group was the vendor Sevenson initially contracted with to perform the solvent
extraction. The subcontract for the solvent extraction technology used a combination of
fixed unit prices and lump sums, and a combination of design and performance
specifications. Fixed unit prices worked well on the site, as more soil was excavated and
incinerated than originally expected.
The ROD for this site specified that solvent extraction would be used to treat and
process soil at the site. EBASCO wanted to broaden the technology to be procured in the
RFP specifications, so that bids on soil washing could also be received. However, they
were precluded from doing so due to the specificity of the ROD language. While
specificity in the language of the ROD did limit the solicitation process, the goals of the
ROD were achieved.
The major procurement problem at this site occurred because the solicitation
package indicated that at the pre-bid conference, bidders were required to provide EPA with
their Toxic Substances Control Act (TSCA) identification number and a treatability
variance. Only two companies came to the pre-bid conference with the necessary letter,
making them the only two companies that were eligible to bid on the contract.
As part of the .proposal process, the bidders were required to demonstrate that their
technology could meet EPA clean-up levels at the site. In order to demonstrate that the
• technology would be effective at the site, some bidders conducted treatability studies at
their own expense with soil samples provided by EPA, and provided the results of the
studies to EPA. This demonstration enabled EPA to select a vendor that was capable of
doing solvent extraction, and have confidence in the technology at the bench scale level.
In procuring this technology, Sanivan claimed tharthe solvents they use are
proprietary. Sanivan did not, however, have a patent on these solvents. This claim
hampered the contract negotiations because Sanivan did not want to release information on
these solvents, and EPA needed to ensure that the treated waste which resulted from the
solvent extraction procedure was not a RCRA hazardous waste. Sanivan provided the
necessary information only when the contract award was dependent upon the release of this
information.
However, Sanivan was bought out by another company soon after starting work on
the site, and stopped work on the site in October 1991. In January 1992, Terra Kleen
emerged as a new vendor able to provide the solvent extraction technology, and Sevenson
is currently in the process of reviewing Terra Kleen's subcontract proposal. It is projected
that Terra Kleen's contract will be finalized by May 1992, and that mobilization will begin
in May. Terra Kleen is also required to demonstrate that their technology can meet EPA
clean-up levels at the site.
31
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SITE INFORMATION
Site:
Pinette's Salvage Yard
Maine
Region 1
Contact:
Mr. Ross Gilleland
RPM
(617) 573-5766
(FTS) 883-5766
Technology:
Chemical Extraction
(Solvent Extraction)
CONTRACT INFORMATION
Procurement Lead: Subcontract through ARCS contract
Contractors): ARCS: EBASCO; Subcontractor: Sevenson Environmental Services; Subcontractor/vendor to
Sevenson for solvent extraction: initially GET Sanivan Group, now Terra Kleen
Procurement Started/Completed: Sevenson (Sanivan): 4/90-10/90 (6 months); Sevenson (Terra Kleen): 1/92-5/92
(4 months)
Number of Bids: 2
Phase of Procurement: Contract Administration
Method of Solicitation: Competitive, negotiated
Type of Contract: Fixed unit price and lump sum
Protests/Claims: None
Change Orders: Several due to changing site quantities and conditions
Special Clauses Used in RFP/IFB/Contract: TSCA identification number and treatability variance were required in
RFP
Bonding Requirements: Yes
Patent Issues: None, although Sanivan claims its solvents are proprietary and was reluctant to release necessary
information to EPA (some types of solvent extraction are patented) . ' -
Prequalified Bidders;-No
Type of Specifications: Both performance and design
Sole SnnrcA Issues; Mnt applicahlp mmpptitivp prnnnrprnptnt _ :
to
EXPERIENCES ENCOUNTERED
RESOLUTION/
OUTCOME
WHAT WORKED WELL/ADVICE
•Bid package required bidders to produce at
pre-bid conference a TSCA ID number and a
treatability variance. Only two bidders were
aware that they needed to provide a treatability
variance at pre-bid conference.
•EPA required release of proprietary information
on the solvents used in the process in order to
ensure that the treated waste did not become a
RCRA hazardous waste.
•Sanivan was bought out and stopped work.
Only two companies
came with letters and
were eligible to bid.
'Contract award was
made dependent on-the
release and Sanavan
provided the
information. -
• Terra Kleen emerged as
a new solvent extraction
technology vendor and a
new subcontract is
being negotiated.
•Contract for site layout work used design specifications. All
other work was performance based.
•Use performance specifications in order to hold contractors to
meeting the cleanup goals outlined in the ROD.
•Do not specify brand of technology in ROD if treatability studies
have not been completed, but do not be so general that you do
not obtain desired technology.
•As part of the proposal process, bidders to be considered
responsive had to demonstrate that their technology could meet
EPA cleanup levels at the site. To meet this requirement, some
bidders performed treatability tests on soil samples provided by
EPA at their own expense.
•Used unit prices on excavation. .
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IN SITU SOIL FLUSHING
Description of Technology
In situ soil flushing is a technology designed to accelerate the movement of a
contaminant through unsaturated materials. The power to produce an effect is related to
two processes: (1) the increase in hydraulic conductivity that accompanies an increase in
water content of unsaturated soil and (2) the engineering of treatment solutions to the
composition of contaminants and the contaminated medium. A treatment solution is applied
to the soil and allowed to trickle downward and interact with contaminating chemicals.
Contaminants are mobilized and moved downward to a saturated zone where they are
pumped to the surface.
Special Contracting Needs
• Soil flushing is standard construction work. Operation of the system could
be considered service.
• Additional well installation and adjustments to the system are often needed
once remediation begins.
United Chrome Products
An in situ soil flushing technology was used on the United Chrome Products site in
Oregon (EPA Region 10). This technology was originally procured as a subcontract
through a REM IV contract which was later converted to an ARCS contract. The ARCS
contractor is-CH2M Hill. There'are two subcontracts: Wastewater Treatment Systems
(WTS) provided hardware and is constructing the treatment plant; and Riedel built the -
containment unit and infiltration galleries, and is installing the wells. In addition the -
potentially responsible party (PRP) is the city of Corvalis, who is operating and
maintaining the treatment plant. .The procurement for the treatment plant began in October
1987 and ended five months later in February 1988. The procurement for the well
installation began in September 1987 and ended four months later in December 1987.
The two subcontracts were competitively procured through sealed bids. The
bidders were required to submit a technical proposal, cost proposal, their corporate health
and safety program, their equipment, and their subcontractors. Seven bids were received
for the treatment plant contract, and the second lowest bidder won the contract. The lowest
bid was considered too low to include operation and maintenance costs, and CH2M Hill
wrote a formal justification for why this bidder was excluded from further consideration.
Both contracts used a combination of firm fixed prices (lump sums) and unit prices.
The RPM at the site noted that the Riedel contract has been flexible enough to allow
for change orders, which were critical to accomplish the work. For example, since the
remedial investigation underestimated the amount of contamination in the plume, more
wells were added through change orders. This was possible because the wells were unit
priced in the contract. In addition, the contract had originally anticipated that only a section
of the building on the site would be demolished; when the plans changed, it was possible
through change orders to have Riedel demolish the entire building. The RPM stated that he
was able to save several hundreds of thousands of dollars by using change orders.
33
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U)
SITE INFORMATION
Site:
United Chrome
Products
Oregon
Region 10
Contact:
Mr. Loren McPhillips
RPM
(206) 553-4903
(FTS) 399-4903
Technology:
In Situ Soil Flushing
CONTRACT INFORMATION
Procurement Lead: Subcontract through ARCS contract
Contractor(s): ARCS: CH2M HILL; Subcontracts: Wastewater Treatment Systems (WTS) and Riedel;
Operation and Maintenance: Responsible Parties
Procurement Started/Completed: Riedel contract: 9/87-12/87 (4 months); WTS contract: 10/87-2/88
(5 months)
Number of Bids: 7
Phase of Procurement: Contract Administration
Method of Solicitation: Competitive, sealed bid
Type of Contract: Fixed unit price and lump sum
Protests/Claims: None
Change Orders: 6
Special Clauses Used in RFP/IFB/Contract: Required corporate health and safety program; required small
business participation; required technical proposal for WTS
Bonding Requirements: Performance and payment bonds
Patent Issues: None
Prequalified BJdders: No
Type!0f Specifications: RieaeTcohtract: de^gnrWTS contract: perfbrmance
Sole Source Issues: Not applicable, competitive procurement
EXPERIENCES ENCOUNTERED
RESOLUTION/
OUTCOME
WHAT WORKED WELL/ADVICE
With WTS contract, filter press could
not handle amount of sludge needed
to operate effectively.
Lowest bidder on treatment plant
was not considered because of poor
record of equipment which would
have led to excessive operation and
maintenance costs.
Since contract had
performance specifications,
CH2M HILL was able to
withhold payment until
subcontractor provided
equipment capable of
handling necessary amount
of sludge.
Prime contractor had to
write formal justification
explaining why this bidder
was not responsive.
Unit prices were used for excavation and well installation. When
additional wells were needed due to differing site conditions, unit
prices on wells easily allowed the changes.
The technology in the ROD was generic and allowed flexibility to
accomodate a design tailored to site conditions.
Use of performance specifications required subcontractor to
provide correct equipment (instead of what was specified in the
subcontractor's design) to perform job at their cost.
Two separate bids were let ~ one to construct the soil flushing
system (e.g., infiltration galleries and wells) and another to build
a wastewater treatment system to treat the elutriate.
Soil flushing is standard construction type work.
-------
Problems were avoided by using performance based specifications for the WTS
contract. For instance, the first treatment unit which WTS provided contained a filter press
that was inadequate for the amount of sludge it was expected to handle. Since the contract
with WTS utilized performance specifications, CH2M Hill was able to withhold payment
until WTS provided more expansive equipment which was capable of handling the
necessary amount of sludge.
The ROD for this site was one of the first RODs ever written in EPA Region 10.
The description of the remedy in the ROD was general, and only stated that a pump and •
treat technology would be used. Therefore, the ROD did not limit the remedy to one
specific type of technology. The flexibility of a nondetailed, nonspecific ROD enabled the
contracts with CH2M Hill, Riedel, and WTS also to be flexible.
, Riedel was required to have performance, bid, and payment bonds. Riedel went to
a bonding company to obtain these bonds. They did not encounter any bonding difficulties
since they had previously performed work at Superfund sites.
Lipari Landfill
For the remediation of Operable Unit 2 (OU2) at the Lipari Landfill site in New
Jersey (EPA Region 2), an in situ soil flushing technology was competitively procured
through sealed bids by the COE as a subcontract through a prime contractor. The
procurement began in April 1989 and was completed four months later in July 1989.
BECHTEL Environment, the prime contractor for this site, received eight bids, and
awarded the subcontract to CDM. In procuring this technology, COE did not encounter
any problems; there were no patent issues and no protests or claims. To minimize potential
problems, COE used a complete design package, which prescribed the total treatment
system and hence, minimized the need for decisions on the part of the contractor.
The subcontract for the in situ soil flushing technology was a fixed price contract,
using a combination of fixed unit prices and lump. sums. Unit prices were used for well
installation, extraction, injection wells, and discharging the water to a publicly owned
treatment works because it was difficult to ascertain the exact volume of material to be
remediated at this site, and even a small difference in the projected volume (as opposed to
actual volume) would result in a large cost difference. Both parties hedged their risk by
using a combination of lump sums and unit prices in that, the contractor is fairly
compensated if there is more soil to be treated than originally anticipated, and the
Government does not lose money if there is less soil to be treated than expected.
35
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ON
SITE INFORMATION
Site:
Lipari Landfill
(Operable Unit 2}
New Jersey
Region 2
Contact:
Mr. Thomas Graff (COE)
Project Manager
(816)426-5832
Ms. Joanne Chapman
(COE)
Contract Specialist
(816)426-5832
Technology:
In Situ Soil Flushing
CONTRACT INFORMATION
Procurement Lead: U.S. Army Corps of Engineers
Contractor(s): BECHTEL Environmental; Subcontract: COM
Procurement Started/Completed: 4/89-7/89 (4 months)
Number of Bids: 8
Phase of Procurement: Contract Administration
Method of Solicitation: Competitive, sealed bid
Type of Contract: Fixed unit price and lump sum
Protests/Claims: None
Change Orders: Several
Special Clauses Used in RFP/IFB/Contract: None
Bonding Requirements: 100% bonding was required
Patent Issues: None
Prequalified Bidders: No
Type of Specifications: Design
-Sole Source Issues: Not applicable, competitive procurement -
EXPERIENCES ENCOUNTERED
RESOLUTION/
OUTCOME
WHAT WORKED WELL/ADVICE
None
(Not applicable)
•Unit prices were used for well installation, extraction and
injection.
•Lump sums were used for construction and operation and
maintenance.
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CHAPTER VI
RECOMMENDATIONS AND CONCERNS
FROM THOSE INTERVIEWED
This chapter identifies problems encountered in procuring innovative technologies,
as well as specific ideas on how the procurement process for obtaining innovative
technologies can be improved.
EPA/CPE Liaison Issues
Both the COE and EPA at several sites felt they were at a disadvantage in procuring
an innovative technology because neither had the background necessary to fully evaluate
bids or proposals for innovative treatment technologies. It was suggested that persons with
education arid experience in subjects such as biology and chemical engineering would be
helpful additions to the COE/EPA staff evaluating bids or proposals for innovative
treatment technologies.
In addition, it was noted that, in order to protect against leaks to bidders, the COE
does not share the bid financial information with any person or agency, including EPA.
Since EPA is not able to know the bidders' price quotes, it is then difficult for EPA to make
the necessary decisions between technical quality and cost in negotiated acquisitions when
evaluating bids for innovative treatment technologies. It was suggested that COE share
bidders' cost estimates with EPA in the initial phases of the procurement.
It was also suggested that COE make a similar clarification to their acquisition .
regulations and procedures as EPA has made to the EPAAR so that subcontractors who
perform a treatability study at a particular site can participate in the construction at that site.
COE preplaced contracts expedite the procurement process; however, these
contracts run about 25% higher in costs than competitively bid contracts. It was also noted
that, while there is an option to acquire innovative technologies through nonstandard
contracting mechanisms, the COE tends to focus primarily on using fixed price (lump sum)
contracts.
Contracting Options
It was suggested that procuring an innovative treatment technology with a level of
effort contract rather than a fixed price contract will lead to fewer change orders during the
contract administration phase of the project. Due to the inherent uncertainties with using an
innovative treatment technology, combined with the difficulty of accurately predicting site
conditions during the remedial investigation, fixed price contracts can lead to a large
number of change orders.
It was also suggested that if the solicitation process was made a part of the remedial
design phase, the cost of using an innovative technology on a particular site would be
known prior to developing a budget for the remedial action phase.
37
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State-Lead Projects
For State-lead projects, all communication to the contractor has to be from the State,
since the State is responsible for the contractor's actions. However, this situation creates
complexity for EPA RPMs in managing the cleanup of the site, since the RPM cannot
communicate with the contractor directly. This is compounded by the fact that the EPA
RPM is ultimately responsible for the cleanup of the site. Therefore, it is essential for
RPMs to provide constant oversight and guidance to States on State-lead projects. In
addition, it should be taken into account that it may take longer to procure an innovative
technology under State-lead projects. ;
Patent Issues
i
For patented innovative technologies, it was suggested that EPA Headquarters take
the lead in negotiating patent rights with the patent holder. EPA Headquarters is in the
position of being able to negotiate nationwide patent rights, so that when any EPA region
needs to procure a patented innovative technology, these rights would apply. One site ran
into difficulties when patent issues arose, and had to use a COE patent attorney to negotiate
on behalf of EPA because EPA Headquarters was not able to provide a patent attorney.
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Bonding Issues
It was noted that it is important toidiscuss bonding requirements with the
Contracting Officer before the contract award so that bonding issues will not delay the
remedial construction. Contractors cannot be prevented from pledging private assets to
meet bonding requirements. If private assets are pledged for a bond, each asset must be
evaluated, which is a time consuming process and will lengthen the time needed for
procurement.
Contractual Requirements
It was noted that since innovative treatment technologies can be more complex to
procure, it can be difficult to know the next step to take in the procurement process. Thus,
it is essential to meet with the EPA CO tojreview the EFB/RFP and the contract to ensure
that the requirements are not ambiguous. ;It was also suggested that all standards which the
contractor must meet should be set out in ithe contract. Then, if problems arise, the
standards can be used to document the extent of any deficiencies in the contractor's
performance.
Several sites ran into difficulties when the prime contractor used a different
subcontractor than was bid in the original proposal. This resulted in different materials and
processes being used on the site, which led to different results on the site. It was
recommended that, before the contract is awarded, the prime contractor should be required
to use the subcontractor(s) which were bid in the original proposal/bid, since their
bids/proposals are evaluated on the basis of these subcontractor(s). The FAR clause on
subcontracts (FAR 52.244) specifies when CO consent to any new subcontracts is
required. In addition, a specific clause can be included in the contract that EPA must be
informed when changes are made in subcontractors or materials. It should be noted that
there may be extenuating circumstances where a change in subcontractors is unavoidable.
At one site, the switch in treatment methods used by the subcontractor resulted in a change
in the structural characteristics of the treated soil itself, and the soil was not able to be used
as originally planned. It was noted that it is important to look not only at how the treatment
38
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technology affects the contaminants, but also how the soil is affected by the treatment
process. ,
It was also noted that it is difficult to achieve competition in the procurement
process when there are only one or two vendors which are qualified to provide the
technology.
Treatability Studies
It was suggested that remedial sites always complete a treatability study in order to
determine how the innovative treatment technology will work on the site. It is difficult to
rely on information on how a technology worked on another site, because innovative
treatment technologies (particularly in situ technologies) will work differently on different
sites.
39 &U.S. GOVERNMENT PRINTING OFFICE: I»92 - C48-003/41837
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