Performance Based Contracting A USACE Perspective Presented by

Performance Based Contracting A USACE Perspective Presented by Michael W. Sydow, PE Chief, Environmental and IIS Management Branch USAED Savannah 30 Nov 00 same. ppt 1

Why PBC l l l Government Performance and Results Act of 1993. Federal Acquisition Streamlining Act of 1994. Utilized successfully in private sector since the 70’s. DOD Business Initiatives Council adopts concept in 2002. ACSIM/ODEP deploy PBC as a matter of Army policy in 2003. – Defense Planning Guidance – Army Environmental Strategic Cleanup Plan – FUDS Program Policy (ER 200 -3 -1) (3) 30 Nov 00 same. ppt 2

Why PBC l Current process employed to date is inherently phase focused and process driven. – Not viewing the problem in a holistic manner. l PBC is based on achieving an Exit Strategy – Incorporates Life Cycle Project Management. – Incorporates future land use planning. – Affords greater flexibility in meeting changing project requirements. (3) 30 Nov 00 same. ppt 3

What PBC Does Not Do! l l l Does not change applicable laws or regulations. Does not relieve DOD of it’s liability. Does not negate Federal Facilities Agreements or Cooperative Agreements. Does not eliminate the Partnering Concept. Does not mean the contractor is turned loose with no technical or administrative oversight. It is simply a new Business Process! (3) 30 Nov 00 same. ppt 4

PBC Defined l Objective is to define the “What” not the “How” – Focus on the End Point and not the Process. l Army Policy – Fixed Price Contracts only. – Incentives and Insurance may be applied based upon the amount of risk and uncertainty. – Competitive bid process with a minimum of three qualified vendors. – Can be used for all project phases, from RI through RAO and LTM. (3) 30 Nov 00 same. ppt 5

FUDS Programmatic Goals l l (3) 30 Nov 00 same. ppt Funds Obligation – FY 05 7. 5% – FY 06 15% – FY 07 25% – FY 10 50% DPG Goals for Responses in Place (RIP) and Response Complete (RC) – FY 07 High Relative Risk Sites – FY 11 Medium Relative Risk Sites – FY 20 Low Relative Risk Sites 6

FUDS Challenges l Budget Limitations – Averages $250 M per FY. – Number of States and Territories competing for funds. – Number of eligible sites competing for funds. l Private Property Owners l Potentially Responsible Party (PRP) Issues l Competition for Regulatory Agency resources l New Business Process (3) 30 Nov 00 same. ppt 7

USACE Initiatives l l Developed and deployed PBC Training Established USACE Contract Acquisition Working Group – – l l (3) 30 Nov 00 same. ppt Developing national contract strategies. Share Lessons Learned. Leverage resources from across USACE. Obtained Industry input. Developing After Action Reports for established contracts Participate in Interagency Forums 8

How Do We Make It Work? l Proper Project Planning – Site selection. – Sound Performance Work Statement with Measurable Performance Standards. – Development of Transition Plan from current contract actions to PBC. l Engage the Regulatory Community – Includes Planning and Contract Acquisition phases. l Educate the entire Team – What changes, what doesn’t, and what are the impacts? – Roles and Responsibilities. (3) 30 Nov 00 same. ppt 9

How Do We Make It Work? l Communication must be open and continuous – Need a well developed Project Management Plan that clearly identifies Exit Strategies and Major Milestone Dates. – May require frequent Project Meetings and/or Teleconferences. – Allows all Team Member organizations to determine and plan resource requirements. l Seek process efficiencies – – – (3) 30 Nov 00 same. ppt Number, type and format of submittals. Concurrent reviews. Authority for approval. 10

Questions? 30 Nov 00 same. ppt 11