DOE awards $887M contract to Isotek Systems for U-233 disposition and building planning
Contract Overview
Contract Amount: $887,279,962 ($887.3M)
Contractor: Isotek Systems, LLC
Awarding Agency: Department of Energy
Start Date: 2003-10-09
End Date: 2028-12-31
Contract Duration: 9,215 days
Daily Burn Rate: $96.3K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 2
Pricing Type: COST PLUS FIXED FEE
Sector: Other
Official Description: U-233 DISPOSITION AND BUILDING 3019-PLANNING AND DESIGN (PHASE I) FOR PROCESSING OF MATERIAL, BUILDING SHUTDOWN (PHASES II AND III)
Place of Performance
Location: OAK RIDGE, ANDERSON County, TENNESSEE, 37830
Plain-Language Summary
Department of Energy obligated $887.3 million to ISOTEK SYSTEMS, LLC for work described as: U-233 DISPOSITION AND BUILDING 3019-PLANNING AND DESIGN (PHASE I) FOR PROCESSING OF MATERIAL, BUILDING SHUTDOWN (PHASES II AND III) Key points: 1. The contract focuses on the disposition of U-233 material and planning for processing facilities. 2. Isotek Systems, LLC is the sole awardee under a full and open competition. 3. The contract spans nearly 10 years, indicating a long-term commitment to the project. 4. The significant value suggests a complex and critical undertaking for the Department of Energy.
Value Assessment
Rating: questionable
The contract type is Cost Plus Fixed Fee, which can lead to cost overruns if not managed carefully. Benchmarking against similar complex material disposition contracts is difficult due to the unique nature of U-233.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
Despite being awarded under full and open competition, the long duration and specific nature of the work may limit future competitive opportunities. The fixed fee component provides some cost control, but the cost-plus nature requires diligent oversight.
Taxpayer Impact: Taxpayer funds are committed to a long-term, complex project involving hazardous material disposition, with potential for cost escalation under the CPFF structure.
Public Impact
Ensures progress on critical nuclear material disposition, enhancing national security and environmental safety. Supports specialized technical expertise and infrastructure development within the nuclear services sector. Long-term project may create stable employment opportunities in Tennessee. Potential for unforeseen technical challenges and cost increases inherent in nuclear material handling.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost Plus Fixed Fee contract type carries inherent risk of cost overruns.
- Long contract duration increases exposure to changing regulations and technological advancements.
- Disposition of U-233 is a complex and potentially hazardous undertaking.
- Lack of small business participation noted.
Positive Signals
- Awarded under full and open competition, suggesting a robust initial selection process.
- Addresses a critical national security and environmental mandate.
- Long-term planning indicates a strategic approach to a complex problem.
Sector Analysis
This contract falls within the 'Other Support Services' sector, specifically related to government facilities and environmental remediation. The value is substantial for this type of service, reflecting the complexity and criticality of nuclear material disposition.
Small Business Impact
The data indicates no small business participation in this contract. Given the specialized nature and large value, it's possible that large, experienced firms are best suited, but opportunities for subcontracting to small businesses should be explored.
Oversight & Accountability
The Cost Plus Fixed Fee structure necessitates rigorous oversight from the Department of Energy to ensure cost control and adherence to project milestones. Regular performance reviews and audits will be crucial.
Related Government Programs
- All Other Support Services
- Department of Energy Contracting
- Department of Energy Programs
Risk Flags
- Cost overrun potential due to CPFF structure.
- Long-term contract duration risks obsolescence or changing requirements.
- Complexity and inherent hazards of U-233 disposition.
- Lack of small business involvement.
- Potential for schedule delays in complex technical projects.
Tags
all-other-support-services, department-of-energy, tn, definitive-contract, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Energy awarded $887.3 million to ISOTEK SYSTEMS, LLC. U-233 DISPOSITION AND BUILDING 3019-PLANNING AND DESIGN (PHASE I) FOR PROCESSING OF MATERIAL, BUILDING SHUTDOWN (PHASES II AND III)
Who is the contractor on this award?
The obligated recipient is ISOTEK SYSTEMS, LLC.
Which agency awarded this contract?
Awarding agency: Department of Energy (Department of Energy).
What is the total obligated amount?
The obligated amount is $887.3 million.
What is the period of performance?
Start: 2003-10-09. End: 2028-12-31.
What are the specific milestones and deliverables for each phase of this multi-year disposition project, and how will performance be measured against them?
The contract likely outlines detailed milestones for planning, design, building shutdown, and material processing. Performance will be measured through adherence to schedules, quality of deliverables (e.g., design documents, safety reports), and effective management of U-233 material according to stringent regulatory requirements. The fixed fee is contingent upon meeting these defined objectives.
What risk mitigation strategies are in place to address the unique hazards associated with U-233 material handling and disposition?
Mitigation strategies would include robust safety protocols, specialized containment facilities, extensive personnel training, emergency response plans, and compliance with all relevant nuclear safety regulations. Isotek Systems must demonstrate comprehensive expertise in handling radioactive materials, with contingency plans for spills, contamination, or unexpected reactions.
How does the fixed fee component of this CPFF contract ensure cost-effectiveness given the potential for unforeseen technical challenges in nuclear material disposition?
The fixed fee provides an incentive for the contractor to control costs beyond a certain point, as they retain a portion of any savings. However, the 'cost-plus' aspect means the government covers allowable costs. Effectiveness relies on clear definition of 'allowable costs' and rigorous DOE oversight to prevent unnecessary expenditures, especially when unforeseen technical issues arise.
Industry Classification
NAICS: Administrative and Support and Waste Management and Remediation Services › Other Support Services › All Other Support Services
Product/Service Code: MAINT, REPAIR, ALTER REAL PROPERTY › MAINT, ALTER, REPAIR NONBUILDINGS
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Offers Received: 2
Pricing Type: COST PLUS FIXED FEE (U)
Contractor Details
Parent Company: Groupe Snc-Lavalin Inc
Address: 700 S ILLINOIS AVE, OAK RIDGE, TN, 37830
Business Categories: Category Business, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $1,091,846,419
Exercised Options: $1,091,846,419
Current Obligation: $887,279,962
Actual Outlays: $297,201,017
Contract Characteristics
Multi-Year Contract: Yes
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Timeline
Start Date: 2003-10-09
Current End Date: 2028-12-31
Potential End Date: 2028-12-31 00:00:00
Last Modified: 2026-04-02
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