PWS 12 - ARMS_12_2025_Draft.docx

RADFORD ARMY AMMUNITION PLANT

PERFORMANCE WORK STATEMENT (PWS)

PWS 12: Armament Retooling & Manufacturing Support (ARMS) November 2025

1. Purpose

1.1. The ARMS Program is a Congressionally mandated defense conversion/commercial reuse program established in 1993 (10 USC 7551-7555, “ARMS Initiative”) to reduce government-ownership costs at Government-Owned, Contractor-Operated (GOCO) Army Plants while also maintaining a readiness capability. The Army’s ARMS program, by allowing the use of GOCO facilities for ARMS efforts, enables the contractor to reduce facility operation and maintenance costs.

1.2. The contractor may be authorized to use the facility for commercial, non-government, government, third party, and/or tenant use under the authorization and in compliance with Federal Acquisition Regulation (FAR) Part 45 and the ARMS Initiative. To participate in the ARMS Program, the contractor shall:

1.2.1. Encourage and execute commercial use of the Radford Army Ammunition Plant (RFAAP).

1.2.2. Actively market the capabilities and equipment at RFAAP.

1.2.3. Increase the opportunities for small businesses (including socially and economically disadvantaged small businesses and new small businesses) to use eligible facilities.

1.2.4. Encourage, promote, and execute the creation of commercial jobs to retain critical skills needed for the mission of RFAAP.

1.2.5. Track, maintain, and report, as required, the Facility Contractor Account (FCA) and records of costs, revenues (to include product cost reductions, cost offsets and overhead reductions), critical skills, jobs created, and benefits to the Army resulting from tenant use and third-party commercial use efforts at RFAAP.

1.2.6. Encourage the private sector to leverage available federal, state, and local government resources to achieve the goals and objectives of the ARMS Initiative.

1.2.7. Support, encourage, and execute the generation of new sustainable startup businesses and jobs.

1.2.8. Develop and execute land and property uses supporting the purposes of the ARMS Initiative and surrounding communities.

2. BACKGROUND

2.1. The ARMS Program is a Congressionally mandated defense conversion/commercial reuse program established in 1993 (10 USC 7551-7555, “ARMS Initiative”) to reduce Government-ownership costs at the GOCO Army Ammunition Plants/Depot while maintaining a readiness capability and to reduce the impact of defense downsizing on local communities. The Army, by allowing the use of GOCO facilities for ARMS efforts, enables the Facility Contractor (herein also referred to as “Contractor’) to reduce facility operation and maintenance costs.

3. SCOPE

3.1. RFAAP consists of two separate facilities; the main plant is the RFAAP manufacturing facility and consists of 4,080 acres and is divided into two parts by the New River. The New River Storage Unit is located 12 miles from the main plant near the town of Dublin and consists of 2,821 acres.

3.2. Utilities access shall be provided to tenant locations to include electricity, water, wastewater, compressed air, natural gas, and steam.

3.3. The contractor shall ensure that tenants comply with all applicable installation requirements and that all regulations are flowed down to the tenants.

3.4. Prior to any tenant occupying RFAAP property under an approved tenant use agreement (TUA), the contractor shall decontaminate facilities and equipment to the appropriate degree necessary to ensure all buildings and equipment meet OSHA standards and explosive siting requirements are met in accordance with (IAW) the Safety PWS.

4. DEFINITIONS

4.1. “ARMS Agreements” refers to the relevant terms of the contractual agreement between the Government (Government Contracting Officer) (ex. Approval Memorandum, etc.) and the Contractor, the agreement between the Contractor and the tenant, or the agreement between the Contractor and the Government with respect to third-party commercial/Government work.

4.2. “ARMS Property Manager” is the Facility Contractor representative who manages and oversees the ARMS program.

4.3. “Army Portion” refers to that portion of the ARMS consideration/revenue in the FCA that is used to fund the execution of approved ARMS projects for existing/potential tenants and any other approved use of funds for ARMS related projects.

4.4. “Blanket-Use Agreement” is an agreement requested by the Contractor that is approved in advance by the Government Contracting Officer to expedite the processing and approval of TUAs/ Request for Use of Facility (RUFs) and/or third-party use proposals/RUFs submitted by the Contractor. Applicable categories (ex. office space) must be pre-approved categories by the Administrative Contracting Officer (ACO) or Procuring Contracting Officer (PCO). Such use is based upon the Contractor’s compliance with the conditions listed in the applicable BUA. For ARMS tenants, this authorization applies to TUAs that do not have a significant impact on human health or the environment in accordance with the National Environmental Policy Act (NEPA) and Army Regulation AR 200-1, and do not involve treatment, storage, or disposal of non-DoD hazardous material as set forth in 10 USC 2692. For third party activities, this authorization provides general terms and conditions for use of specific Government assets, and/or production of specific DoD products, Non-DoD products and/or commercial products, and/or services.

4.5. "Commercial or non-government work" is any work being performed by the contractor that is not for a US government agency.

4.6. “Consideration” is the cause, motive, price or impelling influence inducing a party (government, contractor, tenant, etc.) into a contract/agreement. It can be either monetary or non-monetary.

4.7. “Non-monetary consideration” includes services-in-lieu of rent performed by the contractor or tenants at RFAAP in exchange for the use of government assets.

4.8. “Contractor Compensation/Incentive fee (CIF)” is that portion of the gross ARMS consideration/revenue (cash) and fair market value for services in lieu of rent which is generated at RFAAP and provided to the contractor as compensation/incentive for ARMS property management, marketing, and all other property management related activities.

4.9. “FCA” is the account which holds the gross ARMS consideration/revenue. The FCA is tracked, maintained, and reported by the contractor to the PCO.

4.10. “Fair Market Value”, determined using FAR 45.301 and computed IAW FAR 52.245-9 Use and Charges, is the price for property and/or services agreed upon between a willing and informed buyer or renter and a willing and informed seller or landlord under usual and ordinary circumstances. Fair Market Value is applicable to both cash rent payments and any approved services in lieu of rent.

4.11. “Government Assets” consist of plant equipment (including equipment, machine tools, test equipment, furniture, vehicles and accessory and auxiliary items), buildings, land, and infrastructure. It does not include special tooling or special test equipment.

4.12. “Government Property” is all property (real and personal) owned, leased, and/or acquired by the government at RFAAP.

4.13. “Request for Use of Facility (RUF)” is a proposal provided to the government by the contractor requesting use of government assets for third-party work.

4.14. “Revenue” is total (cash) consideration generated under the ARMS program to include tenant rent and revenue from third-party activities.

4.15. “Tenant” refers to an ARMS commercial tenant, a government entity or the contractor.

4.16. “TUA” is an agreement between the contractor and a tenant that authorizes the use of government assets by the tenant and documents the resulting consideration (rent) from the tenant.

4.17. “Third-party” refers to the contractor’s direct sales of products or services to the government (both DoD and Non-DoD), commercial industry, and/or tenants. The government will not take ownership of technical data or intellectual property rights on third-party/commercial use work.

4.18. “Usage period” is the time during which government assets are approved for use which includes the time to set up assets, perform required maintenance, and restore the assets to their condition code prior to use (less fair wear and tear), where applicable.

5. KEY PERFORMANCE INDICATORS

5.1. On-Time Rent Payments: Ensure that each tenant pays their rent on-time each month or billing cycle

5.2. Project Proposal Turnaround – In order for timely review and completion of projects under ARMS (projects requiring ARMS funding), the contractor shall be measured on the timeline to develop project proposals submitted to the Government for review. The Government will set a preliminary baseline of 45 calendar days from Government submission of the RFP.

5.2.1. Modification Requests would be submitted in a much shorter time frame since they do not require a full pricing proposal, just the required ARMS documentation by tenant and contractor.

5.3. Surveillance – Ensure compliance to annual management execution plan outlined in (CDRL A12-001). The contractor shall provide the number of audits completed each month, which tenants were audited, number of surveillance findings, type of finding (safety, environmental, etc.), corrective action(s), lessons learned, corrective action timeline (baseline of 7 calendar days to repair).

5.4. Total number of Tenants at RFAAP – Incentivize growth of ARMS program at RFAAP.

5.5. Tenant benefit to RFAAP – Metric pushing ARMS program to incentivize tenants that buy RFAAP products (Ex. Grucci, NGC) or supply services to benefit RFAAP (Ex. SMS, Alacran mowing).

5.6. In addition to any KPIs specified in this PWS, the Contractor shall identify a minimum of three (3) KPIs that measure performance, effectiveness, timeliness, and/or efficiency of ARMS efforts at RFAAP. These additional KPIs shall be included in a PWS 12 KPI report. (CDRL A12-002). The initial submission shall be submitted to the Government for approval 60 calendar days after operational control and monthly thereafter.

5.6.1. The Contractor shall define the calculation method for each KPI and any sub-KPIs in the first submission of the PWS 12 KPI report ACA for Government approval.

5.6.2. The PWS 12 KPI Report shall provide targets for improvement for each KPI, with justification as to why the target was determined. Targets may be based on industry standards or baseline data acquired in the first quarter of performance tracking. Targets may be adjusted on an annual basis or sooner, if necessary, with Government approval.

5.6.3. When KPIs are trending negative or consistently below target (for at least three consecutive months), the Contractor shall provide a plan or strategy adjustment to work back towards the target. The plan and/or strategy shall include details on actions to be performed, timeline for improvement and personnel responsible to achieve the target.

6. ARMS TUAs

6.1. TUA Requests: The contractor shall submit one TUA request per tenant to the PCO for review and approval. (CDRL A12-003) Each TUA shall be a separate agreement to include all contractor PWS requirements as flow downs and identification of the specific government assets the tenant will utilize under the TUA. TUAs shall be authorized for time periods not to exceed current ARMS legislation at the time of signature which is currently 25 years. TUAs can be one initial term or an initial period plus options and may exceed the term of the operating contractor’s period of performance.

6.1.1. TUA Requests shall include at a minimum:

6.1.1.1. Justification for the TUA and how it benefits the ARMS program

6.1.1.2. ARMS project scoring package

6.1.1.3. Period of Performance

6.1.1.4. Statement of Work (SOW)

6.1.1.5. ARMS Mandatory Checklist

6.1.1.6. ARMS Safety Checklist

6.1.1.7. Appropriate environmental documentation and permits

6.1.1.8. Breakdown of all costs (e.g., labor hours, labor categories, cost, material list, material cost, Other Direct Cost (ODC) list, ODC cost, travel list, travel cost, indirect cost in detail, etc.)

6.1.1.9. A copy of the explosive site safety plan (ESSP), as required

6.1.1.10. A request for waiver of the 10 USC 2692 legislation if the TUA involves the treatment, storage, and/or disposal of non-Department of Defense (DoD) hazardous material

6.1.2. The contractor shall perform appropriate due diligence in verifying the creditworthiness of a prospective tenant IAW commercial best practices prior to submitting a TUA request to the PCO. Dunn and Bradstreet, commercial trade reference and bank reference are examples of credit sources that may be used by the contractor to evaluate credit worthiness of a prospective tenant. Upon request, the contractor shall provide the government with the results of the credit check along with the supporting documents.

6.1.3. The contractor shall provide a copy of each TUA and any modifications to the PCO within 30 calendar days of the contractor and tenant signing. The government shall possess full rights to publish or post the agreements for the purposes of future competition, conveyance, etc. The contractor shall require the same agreement from all tenants and include the TUA publication release requirement in each TUA to ensure tenants understand and agree to such terms.

6.1.4. Upon approval of the TUA and prior to occupancy by the tenant, the contractor shall conduct a walk-through with the tenant of the government asset(s) to be utilized under the TUA to document current conditions of the assets and note any contamination present. The condition assessment report shall be provided to the PCO and tenant upon completion. The contractor shall update the condition assessment as conditions change and resubmit the report to the PCO and tenant. (CDRL A12-004)

6.1.5. No later than 30 September of each year, the contractor shall provide a status of all TUAs to the PCO to include expiration status. (CDRL A12-005) The contractor shall submit a TUA request to exercise a TUA option, or any other TUA revision, at least sixty (60) calendar days prior to the expiration of the TUA. If the contractor fails to provide the TUA request at least 60 calendar days in advance of expiration, the TUA shall expire IAW the government approved usage period unless the PCO provides written authorization for its conversion to a month-to-month lease.

6.1.5.1. The contractor’s TUA request (options, extensions, expansions, etc.) shall be subject to government approval.

6.1.6. The government shall not be considered a party to TUAs. Each TUA is between the contractor and the tenant. Terms and conditions of each TUA are between the contractor and Tenant.

6.1.7. Should the PCO decide not to approve a new TUA request or renewal for use of government assets, the contractor and associated tenant shall hold the government harmless.

6.2. TUA Expiration and Termination: The PCO may issue the contractor a notice for termination of any TUA or third-party commercial use activity when determined to be in the best interest of the government. When this occurs, the following shall apply:

6.2.1. The contractor shall negotiate a timeline with the PCO for the cessation of commercial use/operations and the return of the facility to the Army.

6.2.2. FAR Part 49 shall be used to set forth the terms for establishing appropriate termination settlement costs.

6.2.3. Settlement consideration costs shall be limited to those costs associated with the same usage period approved by the PCO for ARMS tenant use or third-party use proposals.

6.2.4. Prior to the tenant vacating the facility and the TUA expiring, the contractor shall conduct an inspection to ensure that all property is secure and returned to the condition it was originally provided in as documented in the condition assessment. The contractor shall ensure each government asset used by the tenant is returned to the government with all additions and modifications made to it during the term of the TUA. The contractor shall ensure that all available manuals, licenses, and operating processes for operation and maintenance used by the tenant are present with the machine or equipment upon return. Upon completion of the inspection, the contractor shall provide an inspection report to the PCO no later than 30 days after expiration of the TUA. (CDRL A12-006)

6.2.5. Should the RFAAP facility contract be recompeted and a new contractor (successor) win the contract, the incumbent contractor shall transition all TUAs and the balance of the FCA to the successor during the Transition Period. The successor contractor shall accept the terms and conditions of the TUAs in place as long as such terms and conditions do not violate applicable laws and regulations.

6.2.5.1. In the event the RFAAP contract ends, while authorized TUAs remain in effect, the PCO shall release and hold harmless the contractor from all responsibilities and liabilities occurring after the contract ends.

6.2.5.2. In the unforeseen event a decision is made to sell the installation (Base Realignment and Closure, privatization, etc.), the contractor and the tenant shall not hold the government responsible or liable should the terms and conditions of a TUA not be transferred to the new property owner.

7. ARMS Third-Party Commercial Use Requests and Agreements

7.1. Third-Party Commercial Use Request: The RUF for third-party commercial use of government assets or third-party provision of services shall be submitted to the PCO for review and approval. Note: third-party commercial use agreements shall not extend past the period of performance of the contractor’s facility contract.

7.1.1. The contractor shall submit a RUF request for each third-party use request to the PCO. (CDRL A12-007) If at any time, to include after RUF approval, the commercial order is changed/updated due to a change in product, quantity, period of performance, End Use and/or changes in the government assets being utilized, the contractor shall submit the revised RUF/order to the PCO for re-evaluation and approval.

7.1.1.1. RUF requests shall include at a minimum:

7.1.1.1.1. Customer’s purchase order

7.1.1.1.2. End Use Certification

7.1.1.1.3. List of government owned equipment/facilities/property to be used during execution of the commercial order

7.1.1.1.4. Justification for the RUF and how it benefits the ARMS program

7.1.1.1.5. ARMS project scoring package

7.1.1.1.6. Period of Performance

7.1.1.1.7. Statement of Work (SOW), if applicable

7.1.1.1.8. ARMS Mandatory Checklist

7.1.1.1.9. ARMS Safety Checklist

7.1.1.1.10. Appropriate environmental documentation and permits

7.1.1.1.11. A copy of the explosive site safety plan (ESSP), if required

7.1.1.2. PCO approval of all RUFs shall be required for each third-party production order prior to beginning production.

8. Consideration

8.1 The contractor shall ensure consideration to the government for tenant facility use is IAW FAR Part 45 and FAR 52.245-9, Use and Charges. Consideration shall be in the form of rent or services in lieu of rent. Services in lieu of rent require PCO preapproval in writing.

8.1.

8.2. The contractor shall ensure consideration for third-party commercial use work is IAW with FAR Part 45 and FAR Part 52.245-9. The contractor shall calculate consideration for third party commercial use work based on 4% of the total contract value of the third-party commercial use workload.

8.3. If at any time, the PCO believes the contractor’s proposed consideration for a tenant or third-party commercial use request is unreasonable, the contractor will be notified and required to provide additional rationale. If the PCO deems the consideration unreasonable or impractical, the contractor may request the consideration to be based upon proposed alternate methods IAW FAR Parts 45 and 52.245-9.

8.4. The contractor shall be responsible for collecting all considerations from tenants and third-party commercial use activities and maintaining the consideration in the FCA. If a tenant is delinquent at any time in providing consideration, the contractor shall inform the PCO of the delinquency within thirty (30) calendar days and submit a corrective action plan to address how the contractor will remedy the delinquency. If the contractor failed to notify the PCO within thirty (30) calendar days of the delinquency, or did, but failed to demonstrate appropriate actions were taken to remedy the delinquency, the contractor may be held responsible for the defaulted consideration.

9. ARMS Property Management Requirements:

9.1. Tenant Management Annual Execution Plan: The contractor shall provide the PCO with a marketing execution plan annually. (CDRL A12-008) The marketing plan shall include, at minimum, the following areas:

9.1.1. Expected language changes/additions/removals to any existing TUAs within the fiscal year (FY).

9.1.2. Planned audit dates of tenants to ensure compliance with all flow down requirements and the TUA.

9.1.3. Planned cross-functional meetings with tenants.

9.1.4. Expected rental rates and consideration.

9.1.5. Potential projects for FCA and PAA funding for the FY and a prioritized list for outyear projects.

9.2. ARMS Monthly Activity Report and IPT Meeting: The contractor shall provide the PCO with a Monthly Activity Report detailing the current FCA balance, to include both immediate use of rent and rent collected, marketing activities both completed and planned, TUA changes, tenant audit schedules and results of completed audits, rent collection issues/concerns, tenant corrective action requests, and status updates on ARMS projects in execution. (CDRL A12-009) The contractor shall lead monthly meetings with the government to discuss the Monthly Activity Report.

9.3. ARMS Program Reviews and Workshops: The contractor shall be required to attend annual ARMS program reviews and workshops when scheduled by the government.

9.4. Annual ARMS Validation: The contractor shall support the annual ARMS validation effort by tracking, maintaining and reporting records of cost, revenue, employee totals, third-party commercial use sales, and benefits to RFAAP under the ARMS program as of the of the last day of the government FY.

9.5. Contractor Compensation, Incentive and Consideration Distribution

9.5.1. The annual value of consideration available for use by the government and/or retained by the contractor shall be calculated IAW the ARMS Consideration Distribution Table 1 below. The contractor’s CIF is that portion of the total ARMS consideration/revenue (cash) plus the value of pre-approved and agreed to services in lieu of rent which is provided annually to the contractor as compensation for ARMS property management, marketing, and all other related program management activities. All consideration/revenue shall be maintained by the contractor in the FCA and reported in the ARMS Monthly Activity Report

9.5.1.1. The CIF for completing the ARMS property management requirements shall be calculated based on the annual ARMS validation report using the current government FY ARMS consideration/revenue and will be authorized for payment to the contractor in the following government FY by the PCO. The CIF is due to the contractor within 30 calendar days of government approval of the annual ARMS Validation Report. The contractor’s CIF funds are not available for use by the government. Expenditure of the contractor’s CIF funds is at the sole discretion of the contractor.

Table 1. ARMS Consideration Distribution Table

Current year cash is from 20% revenue loss to 4.99% revenue growth over the Baseline 20% of Total Consideration (Cash)

80%

Current year cash is from 5% to 15.99% revenue growth over the Baseline

Current year cash is 16% or more in revenue growth over the Baseline

9.5.1.2. The contractor’s compensation/incentive is based on the amount of ARMS consideration/revenue (cash) generated during the current year as compared to the revenue generated the previous/prior year. The previous/prior year revenue is referred to as the “Baseline.”

9.5.1.3. If the current year’s consideration/revenue decreases by more than 20% from the Baseline, the Contractor Compensation/Incentive Portion may decrease to 15% of the total current year consideration/revenue. The PCO may decide to allow the 20% compensation amount should there be mitigating circumstances.

9.5.2. Should the contractor not perform IAW with this PWS, the PCO shall have the authority to decrement the CIF payment.

9.6. The ARMS consideration/revenue maintained under the “ARMS Program Portion” of the FCA shall be for government use for the repair, upgrade, etc. of current and potential ARMS tenant needs.

9.7. The contractor has the option of using government assets that are no longer rented by ARMS tenants. However, the government shall be compensated for this use at a fair market rate IAW FAR Part 45 and/or the rates the contractor charges the ARMS tenants. The consideration/rent shall be computed IAW FAR Part 52.245-9 Use and Charges.

9.8. Use Revocation and Unauthorized Use

9.8.1. If the contractor fails to comply with the requirements under this PWS or the government requires use of the government assets, revocation of authorization to use government assets will occur.

9.8.2. The unauthorized use of Government assets may result in fines and/or imprisonment under 18 USC 641.

10. The contractor shall adhere to the most recent version of the Army Regulations (AR) cited in this PWS. Chapter and page numbers are provided for convenience, but do not absolve the contractor of complying with all other applicable parts of the AR. If the ARs are updated during performance, the contractor is responsible for meeting the new requirements as they take effect. Any such Army Regulation changes during the contract period shall be incorporated.

11. The contractor shall provide information and support for all ARMS taskers received from higher headquarters. In addition, the RFAAP Government ARMS Staff will set internal suspense dates for submission of taskers.