Summary: Pursuant to a congressional request, GAO reviewed contractor performance at 43 hazardous waste sites to determine if the Environmental Protection Agency (EPA) had established adequate controls to ensure high-quality, cost-effective, and timely work under its Superfund remedial study contracts.
GAO found that EPA: (1) lacked adequate information to evaluate contractors' work plans and proposed costs; (2) did not adequately monitor contractors' expenditures; (3) did not always perform required contract administration duties, such as reviewing contractor invoices and maintaining complete work assignment files; (4) believed that inadequate contractor performance resulted in cost increases at 22 sites, but challenged cost increases at only 4 sites; (5) believed that cost challenges were difficult and time-consuming and that the contracts required it to pay for costs the contractor incurred; (6) focused on timeliness and quality of remedial studies, rather than their costs; and (7) had options for dealing with increased costs, including negotiating with the contractor to absorb costs, authorizing the increase but not a corresponding increase in the base or award fee, not authorizing the increase, terminating the contract, or disallowing the questionable cost. GAO also found that the award fee process EPA used with remedial study contractors: (1) allowed a contractor to earn the majority of an award during the first phase of the award fee process, before it completed the study and before EPA could assess its quality; and (2) contributed to overall contracting difficulties, since EPA performance evaluation criteria did not require assessment of subcontracting management.
