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Los Alamos National Security LLC Selected to Manage Los Alamos National Laboratory


WASHINGTON, D.C. – Secretary of Energy Samuel W. Bodman announced today that Los Alamos National Security LLC has been selected to be the management and operations contractor for Los Alamos National Laboratory in New Mexico.

Los Alamos National Security LLC is a limited liability corporation made up of Bechtel National, Inc., the University of California, BWX Technologies, Inc., and the Washington Group International, Inc.

The laboratory, one of three National Nuclear Security Administration (NNSA) nuclear weapons laboratories, performs sensitive national security missions, including helping to ensure that the U.S. nuclear weapons stockpile is safe, secure and reliable.

“This contract marks a new approach to management at Los Alamos, one that will benefit the national security of the United States through superb science,” Bodman said. “As this decision benefits the country and the laboratory itself, it will also benefit the greater Los Alamos community and state of New Mexico since it will guarantee the lab will continue its role as an anchor of America’s scientific and national defense efforts. I look forward to a new era of invaluable, cutting-edge science at Los Alamos.”

A Source Evaluation Board (SEB) made up of career civil servants from throughout the nuclear weapons complex began the contract competition process in May 2004, preparing a formal request for proposal that included an unprecedented public feedback process. The SEB, chaired by NNSA’s former General Counsel Tyler Przybylek, then spent five months carefully evaluating the proposals and preparing a report for NNSA Assistant Deputy Administrator for Defense Programs Tom D’Agostino, who made the decision as the selecting official for the contract competition.

The winning team will bring to the laboratory a first-rate combination of experience in research and development enabled by excellence in operations in nuclear and high hazard environments, together with best in class business systems. The new contractor is committed to being a good neighbor in northern New Mexico and to contributing to the economic development of the area through the commercialization of technologies nurtured by the laboratory.

Transition activities will begin upon contract award and the new contractor will take over NNSA mission activities under the new contract starting June 1, 2006. The basic term of the contract is seven years, and up to an additional 13 years can be earned through successful performance under an award term provision. The solicitation provided for offerors to propose a possible maximum fee of between $53, 364,816 and $79,736,715 per year, with the decision of how much fee is paid to be dependent on the quality of performance.

Important goals of the new contract include the following:

Outstanding scientific research will continue in an environment of scientific skepticism with robust peer review;
Laboratory operations will become the model within the nuclear weapons complex for enabling superb science;
The laboratory will benchmark against best practices across the university community, private industry and government, and import into the laboratory best practices, which will make laboratory performance better and cost less, thereby freeing up resources for research and development;
Pension and benefits provisions contained in the request for proposal have been accepted and are incorporated into the new contract, such as all current lab employees (except top managers) are guaranteed jobs at the same pay and with substantially equivalent benefits;
Current employees who elect to retire under the University of California Retirement Program (UCRP) are not guaranteed employment with the new contractor, but may be considered for employment with the same pay and benefits offered to other new employees;
Current employees who are not eligible to retire but who want to freeze their benefits under UCRP are guaranteed their job with the new contractor and will receive the benefits offered to new employees; and New employees will be offered a new benefits package and will be paid using the same guidelines that apply to existing employees under comparable circumstances.
The Los Alamos Laboratory, or Project Y, came into existence in early 1943 for a single purpose: to design and build an atomic bomb. This is the first time since its creation that operation of the laboratory has been open to competition.

Remarks by Energy Secretary Bodman


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