Free Supplemental Brief - District Court of Federal Claims - federal

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Defendant's Supplemental Exhibit 79

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Department of Energy
ROCKY FLATS CFFICE P.O. ~OX g2~ GCU~.N, CC~ORADO ~4024~

February 26, 1990

90-DOE~5212

Mr. Domlnlck Jo Sanchlnl Vlce Presldent, Major Programs Rockwell International Corporation Department 001, Mall Code D-37 2250 East Imperial Highway El Segundo, CA 90245

Dear Mr, Sanchlnl:
In accordance with Appendl× D of Contract DE-ACO4-76DP03553, the Department of Energy (DOE) hereby determines that Rockwell International Corporation (Rockwell) has earned an award fee of $I,241,604 for Plant and $358,035 for PRMP/PROVE, for a total of $|,579,639o The enclosed Performance Evaluation Report for the perlod April 1, 1989 throu~gh September 30, 1989, provides the basis for the DOE award fee determination. The award fee approved by the DOE for payment to Rockwell Is pursuant to an award fee plan prevlously developed to cover the perlod April 1, 1984 to September 50, 1989. This was prior to the Institution by the DOE of stronger and tougher award fee plans 1o reward Improvements In environment, safety, and health (ES&H) and substantially increase the propo~tlon of the fee attributable to ES&H performance. U~der the old contractprovlslons, however, the DOE was constrained as to the weight that might be given to ES&H performance In setting the fee for the six .month period covered. In the old award fee plan, which Includes this period, up to 20% of the total amount of fee pald could be attrlbutable to performance In the ES&H area. By reducing the award fee rating for ES&H to "Unsatisfactory," the"DOE Is Indicating to Rockwell that Its ES&H performpnce was unacceptable. In addition, by reducing the award fee rating &:x" general management to "Marginal," the DOE is Indicating to Rockwell tha~ Its general management performance was deficient. As specified In the Contract, you may, within five ~orklng days after receipt of this letter, request an opportunity to present to the DOE an analysis of your performance under the Contract. Ofherwlse, after this period we will provide you the award fee amount, plus a ba~e fee of $432,850,;f.or a total fee of $2,012,489.
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If you wish to meet with us, pleese contect thls office in order to coordlnete those arrangements fo~ you.

Robert Mo Nelson, Jr. Manager
Enclosures

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PERFORMANCE EVALUATION REPORT ROCKWELL INTERNATIONAL CORPORATION CONTRAC~ NO. DE-AC04-76DP03533 FOR THE PERIOD APRIL 1 - SEPTEMBER 30, i989

The overall performance of Rockwell International Corporation (Rockwell) was maintained at least at the level of "Satisfactory" during the period April 1 through September 30, 1989. The following are separate evaluations of the performance of Rockwell relative to the management and operation of the Rocky Flats Plant and the performance for the Plutonium Recovery Modification Project (PRMP)/Plutonium Recovery Option Verification Exercise (PROVE), in the selected Functional Performance Areas (FPA's). The first section covers Plant operations while the second section covers PRMP/PROVE. he General T Management FPA was evaluated considering performance for both areas. The selected FPA's have been evaluated in accordance with the contract Award Fee Plan, and the following summary of each FPA and resulting award fee earned reflects an integrated assessment of all factors. PLANT GEN]~RAL MANAGEMENT: There was considerable evidence of Rockwell management's inability to effectively manage this facility, and this was seen by DOE to be a serious, major deficiency. This deficiency was manifested in lack of progress in integrating safety responsibility and accountability at all working levels and also by deficient lines of responsibility, procedures, discipline/work ethic, training, on-floor supervision, and problem investigation/resolution. Numerous incidents provide evidence of the above deficiencies. A continuing lack of priority attention to safety and health, as eviden, ced by the open status of many of the safety concerns documented during the period, was a clear, indication of poor management. Additionally, despite an increase in nitrate concentrations on the 750 Pad, little action was taken to contain saltcrete after precipitation events. The preparation for the annual DOE inventory of Special Nuclear Material at Rocky Flats was unsatisfactory. ENVIRONMENT. SAFETY & HEALTH; Long term understaffing in the Health, Safety and Environment organization resulted in less than adequate attention applied to several essential projects and safety functions. Rockwell was unsuccessful in reaching their Plant Performance Goal for reeordable injuries and in reducing the total number of workplace eontamiuation incidents. Rockwell continued to have problem~ in the construction safety area. Rockwell failed to exercise an acceptable level of program management in the development of official recommendations for restart of the Building 374 evaporator. A criticality safety assessment performed in August 1989, noted many aspects of the criticality safety program which needed improvement. Rockwell failed to exercise an acceptable level of program management in dealing with pondcrete and saltcrete. Rockwell's oversight of the environmental subcontractors performing routine environmental monitoring was deficient. As identified in the DOE-HQ assessment team report, deficiencies in the RFP effluent air monitoring program may adversely affect determination cf radioactive materials released to the atmosphere. Waste shipments to Idaho and Nevada were marked by errors in manifests and contamination on waste packages, which jeopardized the future of offsite disposal plans.

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OUALITY: The plant-wide implementation of DOE non-weap0ns quality assurance requirements did not progress at the accelerated rate expected.. . . The Rockwell Final Product Acceptance gr6up performed effectively after on!y one year 0f having the responsibility for most product acceptance. Lot rejects and Final Product Acceptance observations decreased during the second half of FY89. COST MANAGEMENT." Rockwell provided excellent support to both the Environmental Restoration and Waste Management Five-Year Plan and to the Modernization Study. Rockwell did an extraordinary job of collecting information, categorizing and documenting the large number of new funding requirements created by the FBI/EPA investigation, the DOE Tiger teams, and the DOE/CDH Agreement. All validated construction line item projects were included in the Department's 1991 budget request. PRODUCTION OPERATIONS: The processing of procured finished machined products was consolidated within Building 460 to reduce overall process times and decrease costs. Rockwell was effective in reducing halogenated solvent usage, and continued to make progress with its new scheduling philosophy which was designed to minimize work-inprocess inventories by managing bottlenecks. The self-appraisal program instituted in all Production Operations buildings, an adaptation of the. Building 771 Restart Criteria, did not receive sufficient management attention or "own6rship" and was ineffective. CHEMICAL OPERATIONS: Plutonium Recovery Operations and Production Operations worked in conjunction to develop the Nuclear Facility Operation Manual, which was to establish the standard of excellence for operations of Rocky Flats facilities. As a result of the deliverables that Rockwell had to complete before Building 771 restart approval was grant~d, a number of procedures were changed or developed and implemented. This implementation was successful, and the building management team continued to develop and irriplement improvements to those procedures. Rockwell's management controls and directives in areas such as recovery operations planning, work breakdown structure and scheduling systems, and cost control systems result.in implementation/installation/operation delays and other problems. There continued to be a failure to establish performance goals for process operations and to measure process performance; therefore, operations were not baselined to provide for improved performance.
PRMP/PROVE

PROJECT MANAGEMENT; Rockwell took an active role in establishing Los Alamos National Laboratory technical personnel as a part of the PRMP structure. Provisional agreement was reached by the Senior Management Review Board on the baseline PRMP process technologies. Rockwell did not provide an adequate system to produce timely and accurate project control information, integration of an essential, computerized, three-dimensional Plant Configuration Model into the overall PRMP design strategy has been slow.

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COST MANAGEMENT: Rockwell took positive action to reduce the cost of A-E services, including reducing overhead, requirirtg the A-E to meet commitments; and upgrading control measures over the scope of A-E work. " The Cost and Schedule Reduction Precursbr activity incurred over $1.001000 cost without any visible or deliverable product~ which indicates an unacceptable lack of cost controls. " SCHEDULE PERFORMANCE: The PROVE test schedule was prepared as an integrated effort between Plutonium Operations and PROVE engineering. Detailed schedules were developed for activities preliminary to PRMP consrxuction to provide a base for performance measurement. Schedule reports were not provided in a form which ensured timely reporting and accuracy to the overall project schedules. SUBCONTRACT MANAGEMENT: Rockwell took positive action to develop an A-E Statement of Work which provided for their required services .at an appropriate level of detail. Inadequate Quality Assurance/Quality Control oversight of the glovebox subcontractor resulted in extra costs and delivery delays to the Government. DESIGN OUALITY: PRMP Technical Baseline documentation was of unacceptable qualit~t and behind schedule. TECHNICAL PRODUCTOUALITY: Rockwell did not require periodic, independent audit of NQA-1 compliance and Non.-Conformance Report actions to ensure that quality actiohs were completed without prejudice. A QA plan for PRMP, required prior to start of the full design effort and Tide I activities, was not completed.

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Defendant's Supplemental Exhibit 80

United States Government

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memorandum
REPLY TO

Rocky Fiats Office

ArrN ~:

ADM:TA:7679
Review of Rockwell Wriuen and Oral Presentations in Response to the AFDO Demrminadon of 2/26/90, Contract DE-AC04-76DP03533, Evaluation Period 4/1/89 - 9/30/89

SUBJECT:

Robert M. Nelson, Jr., Manager
TO:

At your request, I assembled a team of RFO employees knowledgeable about Rockwell's performance during the evaluation period of April 1 - September 30, 1989. This team has reviewed the material presented by Rockwell in their written comments of May 3 and June 7, 1990, as well as their oral presentation comments of July 10, 1990.

An Executive Summary and an analysis of Rockwell's position are attached for your review.
I recommend, based on the conclusions reached by the team, that the award fee decision of February 26, 1990 remain the same. A change is not wan'anted by the substantive arguments put forth by Rockwell or by any other matters arising from Rockwell's operation of the facility during this period.

¯

tor,

"nisr~tion Division

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EXECU
Background:

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A Y
July 17, 1990

FINAL FEE RECOMMEDA~ON
To: Robert M. Nelson, Jr., Manager, Rocky Flats Office

Under Contract DE-AC04-76DP03533 with Rockwell International (Rockwell) for the award fee period 4/1/89 9/30/89, your award fee determination was issued February 22, 1990. In response to that decision, Rockwell was allowed, under the Contract, to present written and oral arguments which you are required to consider before rendering a final decision. Marshall Bishop was tasked to review the Rockwell comments. The final award fee decision must be transmitted to Rockwell no later than July 24, 1990. Review of Rockwell Comments: A team was assembled to review the Rockwell written and oral comments and met on July 13 and 16, 1990. The team participants and their organizations were: Robert Ostmeyer Gary Huffman Thomas Lukow Shirley Olinger Frazer Lockhart Tod Anderson William Rask The analysis of the Rockwell comments is attached. Conclusion: No data has been presented, nor have subsequent events changed the overall award fee determination. Individual elements may have been influenced by knowledge gained subsequent to the determination of 2/26/90; however, the overall determination adequately accommodated the pluses and minuses. Paramount issues were the filter testing intervals and employment and funding shortfalls. The filter issue was partially addressed in John Tuck's S-3 to S-2 memo of 2/22/90 and the Stephen Wakefield, OGC, memo reviewing the Rockwell management of the filter tests and releases to the environment. Further, the employment ceilings and lack of funding which Rockwell alleged to be the cause of its management problems are only symptoms of the root cause and were assessed appropriately in the AFDO'determination of 2/26/90. Occupational Safety Branch Waste Management Branch Waste Management Division Safety Division Plutonium Recovery Modification Project Quality Assurance Division Production Division

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The following is ~ analysis of the written ~d oral comments from Rock-well in connection with their appeal to the AFDO to reconsider his fee determination made February. 26, 1990 covering the evaluation period April i - September 30, 1989. It was compiled using wording from the three-page evaluation summary comments attached to the AFDO decision of 2/'26/90; Rockwell comments from their letters of May 3 and June 7, 1990 and/or oral arguments of July 10, 1990; and the RFO suggested position was compiled from both written and oral comments from RIO staff during their 7/16/90 analysis of the Rockwell
comrflents.

First the Functional Performance Area ('FPA) is identified, then the i~~ue is quoted from the three-page evaluation summary, then the Rock-well position is followed by an RFO assessment. Where more than one argument was made within an FPA, the issues are numbered and relate to the same numbered Rockwell position and RFO assessment. PLANT FPA: GENERAL MANAGEMENT

Issue from 3-page DOE Evaluation Summary: 1) There was considerable evidence of Rockwell management's inability to effectively manage this facility, and this was seen by DOE to be a serious, major deficiency. This deficiency was manifested in lack of progress in integrating safety responsibility and accountability at all working levels and also by deficient lines of responsibility, procedures, discipline/work ethic, training, on-floor supervision, and problem investigation/resolution. Numerous incidents provide evidence of the above deficiencies.

2) A continuing lack or priority attention to safety and health as evidenced by the open status of many of the safety concerns documented during the period.
3) The preparation for the annual DOE inventory of SNM at Rocky Flats was unsatisfactory.
Rockwell's Position:

1) "There is overwhelming evidence to the contrary, which is ignored by the award fee evaluation. See general comments above."
CT'he general comments referred to argue that Rockwell faced a great challenge just in keeping the plant operating with no significant injuries or releases and at the same time meet the overwhelming demands .of various outside investigators; that Rockwell was a very responsive contractor, that DOE management underwent a great change during the period and that Rockwell. was the only thread of continuity; that there were multiple demandsYrom senior DOE HQ management in temtxn'ary residence; that Rockwell had to support the DOE Criticality Safety Review Team; that Rockwell developed a Management Plan for Rocky Flats Plant Operation Improvements; that Rockwell achieved a reduction of TRU waste generation; and that after each review team departed, DOE would publicly state that no unsafe conditions at Rocky Flats affecting the employees, the ¯ plant or the surrounding community had been found.) In their oral presentation, Rockwell alleges that due to the circumstances surrounding the period under evaluation and the task of managing a plant in such an atmosphere, Rockwell had their finest hour in the General Management area. 1 of 8
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2) RockweLl efforts to close safety concerns were impacted during this period by the audits and investigations that n:u:luired staff attention. However, Rockwell still managed to dose an additional 18 of the approximately 230 TSA Findings, ix'inging the total closed to 163. Many of these action items related to specific recommendations in RockweLl's "Management Plan for Rocky Fiats Plant Olxtation Improvements."

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3) (Rockwell position is lengthy and takes the position that only 2 of 65 SNM MBA's wen: not prepared for the inventory, and that Rock'well cooperated in getting the two problem MBA's inventoried, and that the inv~tory results were favorable.)
RFO Assessment:
¯ 1) The Management Plan for Rocky Flats Plant Operation Improvements was not the masterpiece Rockwell would have us believe. The plan should have been given much more thought and attention by RockweLl in its preparation and was a poor product typical of Rockwell plans. Ther~ was a reduction in TRU waste generation which could have been recognized by DOE in a positive manner. However, the operational status of the Plant for the period reduces the magnitude of the Rockwell claim. Concerning any DOE public statement about the conditions at Rocky Flats after a review team departed; the public statement does not diminish the fact that there are lots of indicators of safety problems and DOE never said that the margin of safety was acceptable.

The other situations cited by Rockwell were a direct result of previous Rockwell management inattention to various issues that had become compounded and then come to a he..ad and had to be addressed all at once due to that previous inattention.

2) The fixes that Rockwell touts wen: often superficial and that real fixes should

have been identified and completed much earlier if Rockwell management had been attentive and commie~i

3) The mot cause was poor coordination by RockweLl management in preparing for the SNM inventory.
PLANT FPA: ENVIRONMENT, SAFETY AND HEALTH

Issue from 3-page DOE EvaluationSummary:
1) Long term ufiderstaffing in the Health, Safety and Environment organization result~ in less than adequate attention applied to several essential projects and safety functions. 2) Rockwell failed to exercise an acceptable level Of program management in dealing with pondcrete and saltcrete.

3) As identified in the DOE-HQ Assessment Team Report, deficiencies in the RFP effluent air monitoring program may adversely effect determination of radioactive materials r~leased to the atmo~here.

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4) Waste shipments to Idaho and Nevada were marked by errors in manifests and contamination on waste packages which jeopardized the future of off site disposal plans.

Rockwelrs Position: 1) (RockweLl position is lengthy and takes the position ~at the HS&E organization was increased 28% during FY89, in spite of fact that in the late 80's DOE had imposed staffing ceilings and was directing the contractors t~operate with fewer people and on a constant or reduced budget; that Rockwell al~ increased wast~ management and RCRA Program staffs from 161 to 208 personnel; that only after the June 1989 raid did DOE show interest in increasing staffing at the Plant to acceptable levels, but personnel in the ES&H field cannot be found easily who are willing to work here after all the public statements and Government actions in connection with the Rocky Fiats Plant.) 2) Attached lerter~, Sanchini/Goldburg of July 12, 1989, Sanchini/Whiteman of October 3, 1988 and Iierree/Whiteman of December 19, 1988 speak for themselves on this issue. In spite of Rockwelrs earlier requests, it was not until the fh-st quarter of FYg0 that DOE made funds available to provide for the purchase of temporary shelters for pondcrete and saltcrete. 3) Radionuclide emissions from DOE facilities have been controlled under EPA regulation contained in 40 CFR 61 since Feb. 5, 1985. Compliance reports for Rocky Flats have been provided to EPA, through DOE, since 1985. Data contained in these reports demonstrate that emissions attributable to R.F operations represent a small fraction of those allowed under the regulation. Furthermore, radioactive ea'nissions to the atmosphere from RF operations have never exceeded DOE's Derived Concentration Guides (DCG). Of the eleven specific recommendations for improvements made as pan of the audit, Rockwell responded by implementing some changes immediately or developing a plan to respond when funds are provided by DOE. The recommendations covered a broad spectrum from writing procedures to addition of new sampling ports to purchasing new, expensive sampling equipment. These improvements, for items such as purcha~g isokir~tic sampling devices are extremely ex~nsive and beyond the funds that DOE had previously elected to provide for this area. None of the audit findings of the assessment Team were based upon identified va'olations of applicable air quality regulations. (See "Audit Findings-Legal Considmations" submitted with Rockwelrs Environmental Assessment Action Plan on November 8, 1989.)

4) Dm'ing the subject time period Rocky Flats shipped 276 trailer loads and 12 milears of waste. One bill of lading and three labeling errors were recorded on the.~ shipments, for a total percentage of error that is miniscule (.001%).
The one case of a contaminated waste package was, on investigation, found to have been caused by an employee at the Idaho National Energy Lab (INEL), who ptmemred a box with a forklift mack and did not properly report it to management.

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RFO Assessment:

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1) DOE had to resort to staffing-level management due to Rockwelrs failure to manage costs, and this was the way DOE attempted to force Rockwell to manage better. 2) Upon receipt of the Jdy 12, 1989 memo from Sanchini to Goldberg, Waste Management was directed to write a memo to Rockwell indica..ting that they were to fund the temporary shelters (tents) with $3.6M from FY89 fu(a..ds. That memo was issued in early August and ha late August Waste Management was informed the tents would be on-site in October 1989. In October it was learned that the tents had not even been ordered and another memo was written asldng that a "Ca'isis Management Team" be assembled to deal with the ponderete issue. Very little progress was made until January 1990 due to a lack of Rockwell management support and deliberate indecisiveness on the part of Rockwell management. There may be some blame on DOE's part for requiring the material to be held at Rocky Flats so long, but the packaging problems were the fault of Rockwell 3) This issue was appropriately addressed in the AFIX)'s determination of 2/26/90. Additionally, Stephen Wakefield's, HQ GC-1, memo of 6/25/90 (attached) addresses a further aspect of this deficiency. Our review of this issue did not support a further reduction to the award fee, nor an inerease as suggested by Rockwell. 4) Our records are incomplete, so the number of incidents will be accepted as stated. However, neither NTS or the transtxxmtion laws provide for an aoceptable level of error. An audit was performed which was not formally transmitted, but the f-mdings were clear and the need was clearly communieatecL There was almost a complete lack of quality assurance system with respect to loading and shipping, compounded by inadequate procedures and training. [It should be noted that some of the errors that occurred (e.g., the bill of lading) were reviewed by other groups and the errors were still missed.] These issues were reviewed with Rockwell. management on several occasions and met with resistance for implementing a change. PLANT FPA: QUALITY

Issue from 3-page DOE Evaluation Summary:
The plant wide implementation of DOE non-weapons qu~llty assurance requirtmx:nts did not progress at the accelerated rate expected. Roekwelrs Position: The RIO QuaLity Assmance Requirements Specification (QARS) was never released by RFO and submitted to Rockwell. The QARS was to provide detailed guidance on how the requirements of the Quality Assurance document, RFO Order 5700.6, were to be implemented at the Rocky Fiats Plant. In addition, RIO Order 5700.6 was never released and given to Rockwell until the end of September 1989. Therefore, it is incorrect for the DOE to criticize Rockwell for not implementing the Non-Weapons Quality Assurance Program at the accelerated rate expected when the RFO did not release the necessary Requirements document for guidance. It should be noted that during the Award Fee Period, Rockwell did make considerable

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progress in the im.plementarion of the Non-Weapons Quality Assurance program as reported to the DOE in RockweLl's SeLf-Analysis.

RFO Assessment:
The existence of an RFO Order is not the issue. Compliance was still required by the HQ order. An RFO Order would not change the basic requirements. However, it should be noted here that RFAO/RFO did not put a high pri,ority on NQA-1 either. PLANT FPA: PRODUCTION OPERATIONS

Issue from 3-page DOE Evaluation Su~:
The self-apt:n-aisal program instituted in all Production Operations buildings, an adaptation of the Building 771 Restart Criteria, did not receive stffficient management attention or "ownership" and was ineffective. Rockwell's Position:

The self-appraisal program instituted in all Production Operations was implemented to the maximum extent possible within the limits of available funding and manpower. The management time required in support of the aforementioned audits and investigations resulted in some implementation delays. However, the major buildings in Pu Operations were essentially completed with the exception of areas such as clothing control, and clean-up/decontamination which were consn'ained by the facility physical configuration and funding availability. In the Production Operations, the main building, 707, and buildings 44.4 and ~47 were essentially completed with constraints similar to those in Pu Operations. A complete listing of each building and the status of implementation is attached.
RFO Assessmenc Rockwell refuses to acknowledge the fundamental issue here: that Rockwell did not and still does not understand theimportance of management self appraisals. They may have went through some of the motions of a self-appraisal, but there was no evidence that Rockwell management really supported the program and they cgrtairdy did not implement the program to the maximum extant possible. PRMP/PROVE FPA: PROJECT MANAGEMENT

Issue from 3-page DOE Evaluation Summary:
Rockwell did n& provide-an adequate system to produce timely and accurate l:n'oject control information. Integration of an essential computerized, three dimensional plant configuration model into the overall PRMP design strategy has been slow.

Rockwell's Position:
1) All monthly cost and schedule performance reports were accurate, delivered on schedule, and correctly reflected project performance in the areas of schedule and cost. This is demonstrated in September 1989 issues of the PRMP and PROVE project reports.

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2) The intel~ation of the three-dimensional plant configta'adon model was successfully completed in this time period when DOE approved incorporating the r~ufirements into the A&E statement of work. Implementation of the model was to begin af~ re_solution of program studies and decision to either modify Building 371 and!or build an annex. These studies are still in process. RFO Assessment: 1) Overall project management was not responsive to the reqt!irements of the DOE Project Management Order, 4700. I, even after emphasis in direct correspondence. The scheduling information was particularly weak. Although schedules were prepared they were not based on any critical path logic (CPM), they lacked evidence of any logic ties, and they did not provide evidence of sufficient detail to allow effective management of the project. In addition, manpower sta~ng plans based on the schedules were repeatedly requested both formally and informally by the DOE and not provided. These fundamental problems in the project management of the PRMP were identified in meetings and formal correspondence, yet were never resolved.

2) Use of a Plant Configuration Model ~ was identified as a reqtdrement for the project in May 1989. DOE took action to acquire special funds earmarked for use in ae..quiring the PCM, and to identify one acceptable conwactor to install the model, to facilitate the PCM work. The PSM was a continuing area of DOE interest, with almost weekly emphasis in meetings, informal conversations, and correspondence. The end result of the DOE emphasis, preliminary technical groundwork, and funding set-aside was the written statement in the architectengineer statement of work that a PCM would be used for PRMP. No deliverables were achieved, or even stated, during the 5 mnth period. DOE approval of the PCM in the A/E statement of work was at the end of the period, after no action had been taken in 5 months, and did not relieve Rockwell of their failure to perform up to that point. PRMP/PROVE FPA: COST MANAGEMENT Issue from 3-page DOE Evaluation Summary: The Cost and Schedule Reduction Precursor activity incurr~ over $100,000 cost without any visible or deliverable product, which indicates an unacceptable lack of cost controls. Rockwell's Position: The cost and schedule reduction precursor studies which accumulated over $100,000 of cost'were suspended when major redirection was received from the DOFdPMP. The data developed during these studies (conducted by Bechtel, J. A. Jone.s, and Rockwell) were ultimately utilized in preparing the cost and schedule estimates submitted for headquarters validations in November 1989. RFO Assessment: The Cost and Schedule Reduction Precm'sor activity was a distinct activity with a completion date in late summer 1989. The purpose of the activity was to identify target issues or items which could provide substantial cost reductions or schedule improvements. These reductions were to be applicable to the project in any form,

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so project redirection is no reason to suspend activity on the task. Even if activity was suspended, there was no interim or closed action report prepared. It appears to the DOE that $1(73,000 was spent with no tangSble product. The fact that over seventy cost saving measures were identified in February 1990 to save almost $200 million dollars compared to the November 1989 estimate, gives further evidence that very little of the claimed cost savings effort went into the November estimate. PRMP/PROVE FPA: SCHEDULE PERFORMANCE

Issue from 3-page DOE Evaluation Summary: Schedule reports were not provided in a form which ensured timely reporting and accuracy to the over~ project schedules. Rockwell's Position: Schedule reports were provided in an acceptable format and quality for the level of project maturity. It was planned to incorporate all project schedules into a computer data base once the program direction had been validated, approved, and stabilized. RFO Assessment:
Project schedules were repeatedly requested to be created on the Primavera® scheduling system specifically procured for PRMP use. This automated sysmm provided for fast, flexible changes, future growth, as the project matured, and clear logic ties for an integrated schedule. In~ the Rockwell proje.~ management continued to provide reports on a graphic baxchart format with no detailed back'up figures and no evidence of logical relationships between tasks. These barchart schedules did not me~t the DOE schedule rrporting rec]tdrements, a fact which was repeatedly communicated in monthly reviews, informal meetings and con'e.spondence. Also, these, graphic schedule.s were difficult and time-consuming to modify. They did not provide an adequate scheduling or reporting tool for the PRMP.

PRMP/PROVE FPA: TECHNICAL PRODUCT QUALITY

Issue from 3-page DOE Evaluation Summary:
Rockwell did not require periodic, independent audit of NQA-1 compliance and Non-Conformance Report actions to ensure that quality actions were completed without prejudice. A QA plan for PRMP, rexlui~ prior to start of the full design effort and Tide I activities, was not completed. Rock'well's Posidon: 1) Rockwell implemented NQA-I in the PR.MP project as a pilot project in 1986. Until recently DOE was uncertain whether to implement NQA-1 at Rocky Flats and therefore the program was not funded and independent audits not undertaken. Although problems were encountered, Rockwell did successfully apply the NQA-1 program on the PRMP project and used the lessons learned to enhance the implementation across the plantsite. 2) All required Q.A. plans were completed and approved by Rockwell in 1988.

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RFO Assessrr~nr

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NQA-1 quality requirements w~e stipulated for use on the PROVE project and on PRMP. The fact that it was the fast major area at Rocky Flats to come under NQAI should have indicated an incre, as~ effort to comply with quality requirements, rather than a diminished effort. Verification and follow-up actions are key to any quality program, whether NQA-1 or not. Lack of independent audits and verification would have been cause for negative comments even ff PRMP had not been under NQA-1. ' OTHER ARGUMENTS PUT FORWARD BY ROCKWELL Rockwell's Position: The DOE changed the rules for the evaluation period unilaterally by setting ES&H goals at 51%, by changing the ~ from Twining to Nelson, by Icing the award fee decision be influenced by politicians and newspapers, by allowing the embarrassment of Rocky Flats to DOE to be factored into the evaluation criteria, and by allowing the series of events between Rockwell and Watldns regarding the suspension of operations issue and the court suit by Rockwell to affect DOE's evaluation objectivity. RFO Assessmem:

These Rockwell comments generally concern legal or contractual issues that would be better addressed, if necessary, before a court of law. They were not addrrssexl during the RFO review meeting held on July 16, 1990.

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