The Recovery Act provides approximately $38.7B in budget authority to DOE. The majority of that funding, an estimated $25B, will be distributed by DOE through the award of financial assistance instruments, e.g., grants and cooperative agreements, rather than through procurement contracts. Approximately $13B, or 52 percent, of the estimated $25B to be distributed will be awarded through competitive financial assistance processes. An additional $12B, or 48 percent, will be awarded non-competitively, largely through formula grants to state and local governments and statutorily specified non-profits, including the community action funds and community redevelopment agencies.
The amount of Recovery Act funding currently expected to be obligated under procurement contracts is approximately $7.9B. Based on DOE’s internal assessment of all potential contract awards to be made using Recovery Act funds, DOE expects approx. $7.3B, or 92.1 percent, will be obligated for new competitively-placed contracts or obligated to existing contracts that were originally awarded using competitive procedures. Obligations against non-competitively awarded contracts are expected to be $620 M, or approximately 7.9 percent of total Recovery Act obligations for procurement contracts. DOE does not expect a decline in the rate of competition because DOE’s internal assessment considered the full cadre of expected contract awards.
The procurement activity of the Department of Energy (DOE) is unique in the federal government in that a significant portion of the DOE mission is carried out by industrial, academic, and nonprofit institutions operating DOE-owned plants and laboratories under a facilities management relationship. These DOE-unique contracts are called Management and Operating (M&O) contracts. Currently, DOE has 26 M&O contracts. Eighteen of the M&O contracts are for the management of DOE national laboratories, with 16 of the 18 laboratories designated as DOE Federally Funded Research and Development Centers. The regulations authorizing and governing the DOE M&O contract are prescribed in the FAR (48 CFR Subpart 17.6) and the DOE Acquisition Regulation (48 CFR Subpart 17.6 and Part 970). Additional information regarding the origin, characteristics, and significance of the DOE M&O contract is addressed in the DOE Acquisition Guide, Chapter 17.6 ( 
http://management.energy.gov/documents/AcqGuide17pt6.pdf). Additionally, DOE has a cadre of major site and facility management contracts that perform cleanup, remediation, and waste management work for DOE’s Office of Environmental Management. A large portion of the DOE funding is directed toward its major site and facility management contracts.
The Recovery Act places special emphasis on the award of competitive fixed-price contracts to the maximum extent practicable. DOE projects that a majority of Recovery Act contract funding will be obligated to existing, cost-reimbursement M&O and major site and facility contracts to fund new and existing projects critical to the Department’s mission. In most cases, these contracts were competitively awarded. It should be noted that these contracts are subject to unique subcontracting requirements which emphasize requirements for placing fixed price, competitively awarded subcontracts to the maximum extent practicable. Based on its internal assessment of potential contract obligations using Recovery Act funds, approx. $246 M, or 3.2 percent, will be obligated to fixed price contract instruments. This projection is consistent with DOE’s historical achievements.
