from Dean Helms, Executive Manager
U.S. Department of Energy Brookhaven Group


According to language in the 1998 Appropriations Act, the Secretary of Energy must notify Congress 60 days before the award of any contract, amendment or modification which requires a waiver from the federal government's competitive procedures.

Because the procurement process for a management contractor at BNL is limited to not-for-profit organizations, Secretary of Energy Federico Pena sent a letter notifying Congress today about the status of the BNL contractor selection process. The letter in its entirety is included below.

The Department of Energy will work with Congress to minimize any adverse impacts of this requirement on the contractor selection process and the day-to-day operations of the Laboratory.

I reassure you that the selection of a contractor to operate BNL remains a high priority. I would also like to assure you that this will not interfere with the Department's commitment to all our stakeholders for operational improvement, increased stewardship of the environment and increased community involvement in Laboratory activities. I will keep you informed of further developments.



The Honorable Joseph M. McDade
Subcommittee on Energy and Water Development
Committee on Appropriations
United States House of Representatives
Washington, D.C. 20515-3810


Dear Mr. Chairman:


Section 301(a) of the recently enacted Energy and Water Development Appropriations Act, 1998 (Pub. Law 105-62) prohibits the use of certain appropriations to award a management and operating contract unless such contract is awarded using "competitive procedures" or the Secretary of Energy grants a "waiver" to the restriction. Section 301(b) requires that the Secretary provide a report notifying the Subcommittees on Energy and Water Development, of the Committees on Appropriations of the House of Representatives and the Senate, of the "waiver" at latest 60 days before contract award. The purpose of this letter is to provide such notice in anticipation of the award of a contract for the management and operation of the Brookhaven National Laboratory (BNL), a federally funded research and development center (FFRDC) .

On May 2, 1997, DOE terminated for the Government's convenience its contract with Associated Universities, Inc., for the management and operation of BNL. The termination will be effective when a new contractor is selected and is in a position to assume full responsibility for the contract work. A succeeding contractor will be selected as the result of a competitive procurement process which has been formally underway since July 18, 1997, when DOE issued public notice of the availability of its solicitation for offers in the Commerce Business Daily (CBD).

Prior to the issuance of the public notice, I directed that prospective sources be limited to nonprofit organizations. The decision was made pursuant to the authority contained at 41 U.S.C. Section 253(c)(3)(B) which permits the use of "other than competitive procedures" when it is necessary to award a contract to a source or sources in order to maintain an essential research capability to be provided by a nonprofit institution or a FFRDC. Except for the restriction to nonprofit rganizations, the procurement is in full compliance with applicable statutory and regulatory requirements for the conduct of competitive procurements. My decision to limit the competition to nonprofit institutions was based on the judgment that a nonprofit research organization could best accomplish the basic research missions of BNL. Specifically a nonprofit organization would be more likely to create and maintain effective partnering with the academic research community which BNL supports and to pursue excellent scientific research with public service as an end in itself. The department was further of the opinion that a nonprofit research organization was likely to promote financially attractive research over basic science and would present less risk of organizational conflicts of interest in the pursuit of research objectives. Because of high priority infrastructure management concerns, however, the Department has nonetheless encouraged potential offerors to consider "teaming arrangements," which could include profit-making entities as major subcontractors, to ensure balanced attention to the conduct of operations, including environment, safety and health management. Public notification of our intent to limit competition to nonprofits was provided in the July 18, 1997 CBD announcement, prior to enactment of the Appropriations Act.

The current status of the procurement is that proposals have been received from eligible offerors and negotiations are in progress. It is likely that, but for the notice requirements of the Appropriations Act, the scheduled award date of mid-November 1997 could be met. The Department has expedited this procurement as we believe that it is in the best interests of the laboratory, as well as the surrounding community, to provide long term, stable management as soon as possible.

If you have any questions on this matter or require additional information, please contact Mr. John C. Angell, Assistant Secretary for Congressional and Intergovernmental Affairs, on 202-586-5450.


Federico Peña
Secretary of Energy