Free Supplemental Brief - District Court of Federal Claims - federal

Case 1:91-cv-01362-CFL

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Defendant's Supplemental Exhibit 63

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Case 1:91-cv-01362-CFL

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Award Fee Determination for the Period October ), $gBB, through Hatch 3)°

based On Perfor~ance Evaluation Revlew"Board reports and e specie1 onstte review, evaluatlon, and recommendation by Edward Goldberg, Act|ng Arei performance as operating contractor" for the Rocky Flats Pl~nto The ,tmertc!l rating of "87" equates to an award fee of $3,8]$,2)3 (this includes ~ reco~ended award, fee of $)86,5g) ~or the Plutonium Recovery flod(f|cation Project/Plutonium Recovery Option Verification Exercise (PROY£)). The ~w]l~ble ~ward fee for the period was $6,822,000. Although the reconenended amount, represents only 53.19 percent of the available award fee, I recommend that in additional downward adjustment be made that reflects the environmental, safety, and health dEs&Ha situation that existed aL the Rocky Flats Plant during the appraisal per|od. ! base my position on the following points: ~

Cessation of operations tn Building 77] tn October ]9B$ due to 4nadequate safety procedures and radtologtcal safety margins tn the building, Although Rockwell pursued a very sg.gressive corrections effort after the fact, the existence of this situation indicated less than satisfactory attitude, procedures,.~nd awareness for s~fety on the part of Rockwell. ~Inety on~ out of (30 safety concerns documented by ~xternml revlew$ (as well Is by ~n internal Rockwell revle.) remained open during the erlod. Again, this indicates that a lack of priority attention e|ng p~Id to safety end health by Rockwell~.~

~

Type Z (serious)..were (dent|f|ed.
A mawr environmental toe]dent occurred during the period .chro~ acid yes released from Building 444 and contaminated the plant's holding ponds. An inoperable Ila~ system and deficient operator vigilance contributed significantly to the seriousness of ~~,

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Ruar Adm~ra~ U.$o ~avy Deput~ Assistant Secretar~ for Military A~pl|catton Defense Program~ ~P-Z31:aMzrchettt:bc:Z-3487:B/ZB/B~(Bonnle HDD--er|cklS) D|strfbut|on: so: Addressee 6bcc: Std DASMA

Correspondence Reviewer

~PR[VIOUS COORDINATION VALID.

Case 1:91-cv-01362-CFL

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Defendant's Supplemental Exhibit 64

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1 2 3 4 5 ROCKWELL INTERNATIONAL CORPORATION, ) 6 ) 7 8 Plaintiff, vs. ) UNITED STATES COURT OF FEDERAL CLAIMS

)

)

) No. 91-1362 C ) (Judge Yock) 9 UNITED STATES OF AMERICA, ) 10 Defendant. 11 12 13 !4 15 16 DEPOSITION OF: 17 18 19 20 21 22 23 Reported by: 24 BARBARA K. HARRIS 25 CSR # 93 CHARLES EDWARD TROELL Tuesday, March 2, 1993 9:30 A.M.

)

) ).

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Troell-Cl Ct Depo

Page 1

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15 1 handbook, was actually part of a headquarters task force 2 that did a fairly thorough look at the award fee possess for 3 DOE and made several recommendations to enhance it. 4 Q. Were the individuals at Albuquerque who were

5 involved in the award fee process at liberty to deviate from 6 the handbook as they wished? 7 A. ! would view the handbook as a guidance document,

8 especially in a period of transition where the department is 9 changing its award fee process. 10 Q. So anybody in the Albuquerque Division who thought

11 it was a good idea to deviate from the handbook was free to 12 do so? 13 A. The PERB, I believe, was free to use the document

14 as guidance and then do what they thought was right in a 15 specific circumstance. 16 17 Q. So if the-A. This doesn't say order. It doesn't say -- l

18 haven't read it. But the handbook is a guidance document. 19 Q. So if the handbook said one thing, the PERB was

20 free to do something else if they thought it was sensible 21 under the circumstances? 22 MR. KOLAR: Could you be more specific about

23 instances, examples? 24 MR. NYE: I will get to that, but right now !

25 am iust askin~ ~enerall~.wining-Plaintiff's Depo, CICt

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58 1 I don't believe it was ever signed. It may have been. 2 Q. Let me draw your attention to the handwriting on

3 the second page of the memorandum. 4 5 A. Yes. Q. Which ! believe says, "Charlie, this is the draft

6 memo which was sent to Mr. Tuck on July 10, 1989. You may 7 want to sign the memo for our records. Ted Hill." Does 8 that refresh your recollection as to whether you ever did 9 sign this memorandum? 10 A. No, it doesn't. I really can't remember whether I

11 did sign it. I remember the process of going through it, 12 Bill, but I just -- I can remember, for example, Twining 13 called me in one day and he says, "Hey, you have seen some 14 of the new input that we have gotten from other folks, 15 including Goldberg, and he said, in light of that, if you 16 were to reassess the performance now, would you come up with 17 a different answer than you did with the information that 18 was available to you at the time the PERB worked before?" 19 And I said, "Yeah; there is additional information,

20 in fact, we didn't have in our possession at the time that 21 we did it, and it probably would lower the overall rating 22 and performance grade." Because Goldberg and company looked 23 a lot more carefully and a lot more specifically at some 24 areas than we had available to us in the normal process that 25 preceded that. Troell-Cl Ct Depo

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Defendant's Supplemental Exhibit 65

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Department of ~nergy
Washington, DC 20585

September 20, 1989

MEMORANDUM FOR

Bruce G. Twining Manager Albuquerque Operations Office Award Fee Determination for the Period October I, 1988 through March 31, 1989, Rockwell International Corporation

SUBJECT:

(RI).
Reference is made to your memorandum to me dated August 8, 1989, on this same subject. This Office has carefully reviewed all of the documentation provided by your Offic~ regarding the Award Fee Determination for the period in question. The Office is essentially in concurrence with your recommendations, with an additional downward adjustment in the area of Environment, Safety and Health (ES&H). The additional downward adjustment to ES&H reflects several concerns. Operations in Building 771 had to be stopped during October 1988 due to inadequate safety procedures and radiological safety margins in the building. Although RI pursued a very aggressive corrections effort after the fact, the mere existence of this situation demonstrated less than satisfactory attitudes, procedures, and awareness o£ safety issues on its part. Out of 230 safety concerns documented by external reviews and an interna! RI review done prior to the award fee period, 91 were not addressed during the period. This further evidences a lack of priority attention paid to ES&H. During the period, 32 new safety concerns, including six classified as Type 2 (serious), were identified. Finally, the release of chromic acid from Building 444 into the plant's holding ponds could have resulted in a major environmental incident. An inoperable alarm system and deficient operator vigilance contributed significantly to the.seriousness oF this incident. Overall. there is strong evidence that throughout the award fee period there was a continuing pattern of lax attitudes, inadequate procedures, and lack of consideration of ES&H issues. My Office has concluded that the "moderately good" numerical grade of 79 given to RI for its performance under the ES&H category be downgraded to a numerical grade of 65.25. Since E~&H carries an evaluation weight of 20 percent, the overall rating for the period drops from 87 to 84.25. This equates to an award fee of $2,716,307 for the Plant. We have not changed the award fee of $186,591 for PRMP/PROVE. Therefore, the total fee is $2,902,898. Admiral Watkins concurs in this recommendation. .,

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-2-

In order to facilitate the dissemination of this information to RI and coordinate it with the letter from Admiral Watkins to Chairman Beall of today's date, we have attached a copy of your draft letter to RI which reflects our concerns in the ES&H area.

John L. Meinhardt Acting Assistant Secretary for Defense Programs
Attachment

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Mr. Dominick J. Sanchini President Rocky Flats Plant North American Space Operations Rockwell Internat$ona! Corporation P.O. Box 464 Golden, CO 80402

Dear Mr. Sanchini:
In accordance with Appendix D of Contract DE-ACO4-76DP03533, hereby determine that Rockwell International Corporation (Rockwell) has earned an award fee of $2,716,307 for Plant and $186,591 for PRMP/PROVE, for a total o£ $2,902,898. The enclosed Performance Evaluation Report for the period October October i, 1988 through March 31, 1989 and a Memorandum from the Acting Assistant Secretary for Defense Programs, provide the basis for my award fee determination. The award fee approved by the Department for payment to Rockwell was pursuant to an award fee plan previously developed to cover the period October I, 1988 to March 31, 1989. This was prior to the institution by the Department of stronger and tougher award fee plans to reward improvements in environment, safety and health (ES&H) and substantially Sncrease the proportion of the fee attributable to ES~ performance. Under ~he old contract provisions, however, the Department was constrained as to the weight that might be given to 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 paid could be attributable to performance in the ES&H area. By reducing the award fee for ES&/~ to "Unsatisfactory", the Department is indicating to Rockwell that your ES&H performance is unacceptable. Under the new plan, failure in any important area may result in the payment of no award fee. As specified in the Contract,~you may, within five working days after receipt of this letter, request an opportunity to present to me, or my designee, an analysis of your performance under the Contract. Otherwise, you may withdraw funds as a net award fee in the above amount from your Special Bank Account.

E 000938

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if you wish to meet with me, or my designee, please contact the Rocky Flats Are~ Office which will coordinate those arrangements for you. Sincerely,

Bruce G. Twining Manager
Enclosures

E 000939