Office of Inspector General report on audit of the contractor incentive program at the Nevada Operations Office
As a result of recommendations in the 1994 report, Making Contracting Work Better and Cost Less, the Department of Energy (Department) has adopted performance-based contracting for the management and operation of its major facilities. Under this approach, contractor performance is to be evaluated against performance measures which are clearly stated, results-oriented, and established prior to performance. The performance measures, which reflect the Department`s expectations of the contractor, are the basis for rewarding superior contractor performance through the use of incentive fees. The purpose of the audit was to determine whether performance-based contracting, as incorporated in the Bechtel Nevada Corporation (Bechtel) contract for the management of the Department`s Nevada Test Site and associated activities, conformed to these principles. The audit disclosed that the performance measures associated with the Bechtel contract did not conform to requirements set forth in the Contract Reform Team report and the Bechtel contract. The Nevada Operations Office (Nevada) established measurement milestones after the work had actually been completed by Bechtel. Further, many of the performance measures were vague and non-specific and, as a result, Nevada rewarded performance that could not be objectively validated. These problems were attributable to the general difficulties in transitioning to the new contracting concept. As a result, the success of the effort to implement performance-based contracting at Nevada was at risk.
- Research Organization:
- USDOE Office of Inspector General, Albuquerque, NM (United States). Western Regional Audit Office
- Sponsoring Organization:
- USDOE Office of Inspector General, Washington, DC (United States)
- OSTI ID:
- 541849
- Report Number(s):
- DOE/IG-0412; ON: TI98000752; NC: NONE; TRN: AHC29723%%68
- Resource Relation:
- Other Information: PBD: 20 Oct 1997
- Country of Publication:
- United States
- Language:
- English
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