W519TC-25-R-0034 Small Caliber Second Source QandAs.pdf

RFP Reference QUESTION GOVERNMENT RESPONSE N/A Request the USG conduct One-on-One sessions with potential offerors. We have questions in several areas of the draft RFP and holding one-on-one sessions would provide the US Government the opportunity to ask questions and clarify bidder questions and concerns which would possibly shorten the turnaround for release of a final RFP.

The Government will not have one-on-one sessions. Questions/comments in response the the Draft RFP are posted on SAM.gov.

Draft RFP, Page 4, Paragraph (e)

Ordering Period 1: Date of Award - September 30, 2027

The initial ordering period is from contract award, assuming first quarter of calendar year 2026, through September 30, 2027. This means price quotes from vendors for proposals will need to be through September 30 2028, which will be the end of the delivery period. Many vendors may refuse to quote prices for this lengthy initial period of approximately 36 months. This will most likely create excessively high escalation rates impacting the offeror and the US Government. Will the US Government revise the initial ordering period to eliminate this issue which will reduce the risk to both the offeror and US Government, as well as improve support from the supply chain? We recommend limiting Ordering Period 1 from contract award to September 30, 2026. This would result in a lower risk to the offeror's ability to establish supplier support and reduce the risk to the US Government receiving overly escalated pricing in period 1.

Ordering Period One and Five lengths will be revised in the Final RFP. Ordering Period One is changed to Date of Award to September 30, 2026 and Ordering Period Five is changed to October 1, 2029 to Five Years from Date of Award. See Final RFP Section A, paragraph (e) upon release of Final RFP.

Draft RFP, Page 4, Unit Price and Example Language If a new award within an Ordering Period changes the Price Matrix quantity range of a caliber family, the unit price of all previously awarded quantities within that Ordering Period will be adjusted accordingly (downward adjustment only).

The unit price adjustment for additional orders made throughout the ordering period creates unnecessary burden on executing the contract and planning for and ordering raw materials and components. Additionally, there is increased burden of adjusting financials from one quarter to the next, dependent on additional orders throughout the ordering period. Will the US Government remove this price adjustment for previous orders made during the same ordering period and pay the DODIC price for the aggregated ordering period quantity made at the time the order is made? Removing the adjustment for previous orders will allow a bidder to more effectively execute supply change management by ordering material as needed, eliminate unnecessary financial adjustments and reduce the risk to the US Government of escalated pricing to cover multiple orders in an ordering period.

The Government stands firm on its cumulative pricing language/requirements. The Government will consider potential impacts quantity awards will have on unit prices as a result of this language.

Draft RFP, Page 87, ECONOMIC PRICE ADJUSTMENT - COPPER The draft RFP sets the baseline Copper price at $4.64 and the EPA for Copper is not applied until Ordering Period 2, resulting in no adjustment for orders made under the first ordering period that may be manufactured and delivered through September 30, 2028.

This results in more than 3 years between when the Copper price baseline is set until the final deliveries are made on the ammunition ordered under the first ordering period. Offerors are unable to lock copper prices without a firm quantity and delivery schedule.

Volatility in Copper prices has increased due to US Government trade policies that continually change resulting in significant daily variations of $.15-$.20 per day in the price of Copper. These factors result in excessive risk on the offeror to fix a price for Copper over a period of time exceeding 3 years. Changes in trade policies may also result in lower Copper pricing providing for a positive price change for the US Government. Will the US Government consider reducing the initial ordering period and implement a Copper EPA adjustment at initial contract award to reduce the Copper pricing risk to the offeror and the US Government? An example of a two-year period of time with high volatility is the variation in cost of Copper from 17 July 2023 at $3.2846 to 16 July 2025 at $5.4829.

This difference in Cu pricing of nearly 67% results in an increased cost that far exceeds the 10% EPA limit. This is the amount of time an offeror would be required to hold the price from bid response through end of Ordering Period 1 (September 30, 2027) without a Cu EPA.

The Ordering Period One length will be reduced in the Final RFP as outlined above;

however, the Government will not implement the EPA at initial contract award or during Ordering Period One. The EPA baselines will be updated for the Final RFP.

See Final RFP Section I Narrative I0001 upon release of Final RFP.

Draft RFP, Page 87, ECONOMIC PRICE ADJUSTMENT - COPPER

Draft RFP, Page 12, RESTRICTION OF CRITICAL ITEMS AND COMPONENTS

FAR 16.203-2 states that an EPA may be used when “(i) there is serious doubt concerning the stability of market or labor conditions that will exist during an extended period of contract performance, and (ii) contingencies that would otherwise be included in the contract price can be identified and covered separately in the contract.” FAR 16.302-2.

There has been significant volatility and cost growth in the raw materials used to manufacture small caliber ammunition, including copper, steel, zinc, and nitrocellulose (NC). This volatility has increased due to US Government trade policies that continually change resulting in significant daily variations in the price of metals. Additionally, companies are required to use propellant manufactured with NC from U.S. or Canada. The sole source of U.S. propellant-grade NC is Radford Army Ammunition Plant (RFAAP), which the US Government has indicated in a draft Request for Proposal that the contract for operating the plant is being competed. Historically, this has resulted in significant NC price volatility and impacts an offeror's ability to obtain pricing from the propellant manufacturer.

Ignoring the current economic and acquisition conditions resulting in the volatility of these raw materials/constituents will either result in an unnecessary escalation in product pricing or the long-term negative economic viability of the contract, neither of which are beneficial to the offeror or the US Government. Will the Government avoid paying an unnecessary price premium for instability in the market price of steel, zinc and NC by including an EPA clause in the RFP consistent with FAR 16.302-2?

Zinc and Steel have been added to the EPA materials in the RFP (see Final RFP Section I Narrative I0001 upon relase of Final RFP). A Nitrocellulose Re-Opener has also been included in the Final RFP (see Final RFP Section H Narrative H0001 upon release of Final RFP).

Draft RFP, Page 87, ECONOMIC PRICE ADJUSTMENT - COPPER Given the extreme volatility of the price of copper, please confirm the EPA is applied for each separate order made during ordering periods 2 through 5? For example, the Copper EPA would be applied to an order made during ordering period 2 and the Copper price would be reassessed through another EPA if a separate order is made during ordering period 2 at a later date.

The EPA will be applied for each quantity award with exception of awards made during Ordering Period One. See Final RFP Section A, paragraph (c) and Section I Narrative I0001 upon release of Final RFP.

Draft RFP, Page 108, Subfactor 1 Production

Draft RFP, Page 119, Subfactor 3, para (3)

How will the US Government accurately and fairly assess technical approach and risk, including capacity and adherence to technical specifications, without assessing demonstrated ammunition produced according to US Specifications? Will the US Government consider requiring bid samples of the four DODICs instead of requiring detailed evidence that demonstrates the Offeror's capability to produce and deliver all DODICs identified in the RFP? This would be in the best interest of all parties by ensuring companies are capable of delivering each caliber in accordance with US Specifications.

The Government will not consider the submission of bid samples. The Government can adquately assess technical capability through the Technical Factor requirments.

Draft RFP, Page 107, Volume I

Volume I - Technical Factor: One digital copy that shall not exceed 100 pages (limited to 20 oversized pages as part of the 100-page limit). Letters of Commitment and Process Maps are excluded from the page limitation.

The 100-page limit will be difficult to adhere to with the amount of information and documentation required in Volume I. Please increase the page limit to no less than 150 pages with the same exclusions. An Alternative to increasing the page limit is to reduce the written requirements included in Volume I and require bid samples for various DODICs.

The Technical Factor page limit in the Final RFP is increased to 125 pages and the IMS submission is removed from the page limitation (See Final RFP Section L, Proposal Submission, paragraph (b) upon release of Final RFP).

DRAFT RFP W519TC-25-R-0034 COMMENTS/QUESTIONS AND ANSWERS

Draft RFP, Page 49

(f) Consideration will be based on actual performance for the prior six-month delivery period and will not take into account when the delinquency is scheduled to be made up. Consideration will be calculated for each DODIC and summed up to determine the total consideration owed. The value of delinquent quantities will be calculated utilizing the unit price of the DODIC* multiplied by the number of units delivered.

Clarify the method of determining consideration by changing the last sentence in paragraph (f) to "The value of delinquent quantities will be calculated utilizing the Consideration Formula below ." The current language is confusing and can be misinterpreted - "multiplied by the number of units delivered."

The Government concurs and the language is revised in the Final RFP.

Draft RFP, Page 122, Integrated Master Schedule

If tracer projectiles and/or magnesium powder are obtained from an OCONUS source, the Offeror shall provide a plan for obtaining the tracer projectiles and/or magnesium powder while still maintaining the overall delivery schedule.

Is Magnesium powder exempt from the Restricted Critical Items and Components list in addition to Tracer and Incendiary Projectiles and their components? Magnesium is not exempted from sourcing in the U.S./Canada under the Restricted Critical Items and Components List; however, the US Government is assessing the offeror's plan for acquiring magnesium powder from an OCONUS source. The US Government did not include assessing the bidder's plan for acquiring incendiary projectiles, which is exempted in the Restricted Critical Items and Components List.

Recommend adding Incendiary projectiles to the IMS paragraph identifying components sourced from OCONUS.

Magnesium Powder is covered under Tracer and Incendiary Projectiles and their components. The Government has revised the IMS language in the Final RFP to remove Magnesium Powder and replace with Incendiary Projectiles and their components (see Final RFP Section L, Technical Factor, Subfactor 2 - Program Management, paragraph (5) and Final RFP Section M, Technical Factor, Subfactor 2 - Program Management, paragraph (5) upon release of Final RFP) .

Draft RFP, Page 3, 7.62mm CLIN: X007 DODIC: A131 What is the US Government doing to address M62 legacy powder restrictions in certain countries overseas? Restrictions on this propellant has significantly impacted the ability to test M62 projectiles OCONUS to ensure adherence to US Military Specifications.

The Government is in the process of qualifying Reach Compliant propellant for M62;

however, we do not guarantee that one will be qualified for all or part of the contract term. The Offeror's reply should be based on using the current propellant and Technical Data Package.

Draft RFP, Page 3, 7.62mm CLIN: X008 DODIC: A151 The Tracer, M62 OHF First Article and Conformance test requirements are challenging to meet and could result in an escalated price for the DODIC or consideration cost to the bidder due to delayed deliveries. Should the bidder include potential language for an RFV to the TDP in the bid proposal and/or plan to discuss a solution at time of award?

The Offeror's reply should be based on meeting the Technical Data Package as there is no mechanism to approve alternate methods during the source selection process.

Potential RFVs require discussion after contract award.

Draft RFP, Page 11, CONTROLLED UNCLASSIFIED INFORMATION (CUI) Recommend the US Government require bidders to be assessed by a CMMC Third Party Assessment Organization (C3PAO) and receive at least a Conditional CMMC Status for CMMC Level 2 Certification by award date to ensure compliance with SECTION C - DESCRIPTION/SPECIFICATIONS/WORK STATEMENT, CONTROLLED UNCLASSIFIED INFORMATION (CUI) .

Per DoD Guidance, DFARS clause 252.204-7021, Cybersecurity Maturity Model Certification Requirements, is currently not to be included in contracts nor should CMMC requirements be levied on contractors through any other contractual terms.

Draft RFP, Page 109, Section L, Volume I, Subfactor 2 - Program Management Recommend adding paragraph (2) Protection of CUI after paragraph (1) Configuration Management under Subfactor 2 - Program Management to require offerors to provide a plan to protect CUI in accordance with Section C.

Recommended addition: (2) Protection of CUI. The Offeror's plan for safeguarding CUI and performing Cyber Incident Reporting in accordance with DFARS Clause 252.204-7012. The offeror will submit a description and evidence on implementation and compliance with the handling, storage, transmission, and destruction of CUI.

This is already a defined requirement as part of the OPSEC Plan submission/approval, therefore, no additional requirements will be included.

Draft RFP, Page 122, Section M, Volume I, Subfactor 2 - Program Management

Recommend adding paragraph (2) Protection of CUI after paragraph (1) Configuration Management under Subfactor 2 - Program Management to assess the offeror's ability to protect CUI in accordance with Section C.

Recommend adding: (2) Protection of CUI. The Government will evaluate the offeror's plan for ensuring all employees that will require access to CUI are trained, all covered contractor information systems comply with Technology (NIST) Special Publication (SP) 800-171, cyber intendents will be properly reported, and all CUI protections required by DFARS 252.204-2012. The Plan will document how the offeror will implement and track the required training and steps the offeror has taken to comply with Technology (NIST) Special Publication (SP) 800-171.

This is already a defined requirement as part of the OPSEC Plan submission/approval.

Draft RFP, Page 12, Supply Chain Risk Management

(a) Manufacture Bill of Materials (MBOM)

(3) The Contractor shall include breakdown of raw material, precursor level, element, and constituents. Applies to the prime and their suppliers, subcontractors, associated integrators, and vendor spanning down to and limited to the 8th tier level, where feasible, of the supply chain, from raw material stage to delivery of a finished product and/or service.

The level of detail required to produce, deliver, and sustain a Manufacture Bill of Materials (MBOM) submission down to the 8th tier level is excessive and is in direct contradiction to the Prime Contractor's responsibility to manage subcontractors and suppliers. The information requested is most often proprietary and will drive unnecessary costs on raw material and component purchases if this requirement is levied on suppliers and subcontractors. Recommend the US Government remove the MBOM requirement from the RFP or revise to a reasonable level that is executable. Bidders are responsible for managing their suppliers and flowing down contractual and technical requirements. In accordance with the Defense Contract Management Agency (DCMA) policies, "it is the prime contractor’s responsibility to manage its suppliers." (DCMA-MAN 2101-04, Delegate Surveillance, March 22, 2024). Requiring the level of information under the MBOM paragraph is in direct conflict of this policy and results in excessive financial burden to bidders.

"8.6. SUBCONTRACT LEVEL DEFICIENCY. It is the prime contractor’s responsibility to manage its supply chain and DCMA’s review of subcontracts will normally be limited to evaluating the prime contractor’s management of its subcontracts." (DCMA-MAN 2303-01, Surveillance, December 28, 2022)

Will be addressed in the Final RFP.

Draft RFP, Page 10, C0004 Engineering Support The Draft RFP states, "As engineering support is needed, the Government will provide the Contractor with a Statement of Work (SOW) and will request a supporting cost/price proposal."

Does the Government intend to issue task orders to bid based on stated labor rates, or will labor rates be part of the evaluated soliciation?

The Government will issue Statements of Work (SOWs) to the Contractor on an as needed base during contract performance. The Contractor will submit a proposal in response to the individual SOWs. The Labor rates will be submitted as part of the proposal response to each individual SOW and negotiated at that time.

Draft RFP, Page 113, (e) Section D - Parent or Affiliated Company The Draft RFP states, "If an Offeror submits past performance information on recent and relevant contracts performed by a parent or an affiliated company as one of its eight contract references, the Offeror shall include performance information in the format provided in Sections A through C above. Further, the Offeror shall explain what resources the parent or affiliated company will provide which will affect the performance of the Offeror and demonstrates meaningful involvement in contract performance."

Could the Government please confirm that this requirement may also pertain to subcontractors?

The Government has revised the Section L and M Past Performance language in the Final RFP to include instances when the Offeror submits past performance contract references as a subcontractor and/or the Offeror proposes to use a Major Subcontractor in performance of this effort and is submitting past performance contract reference for the Major Subcontractor.

Draft RFP, Pages 109-110, Section L, (5) Integrated Master Schedule We would like to provide a comprehensive Integrated Master Schedule. Could the Government consider removing the Integrated Master Schedule from the overall page limit for Volume I?

The Integrated Master Schedule has been removed from the Techncial Factor page limit in the Final RFP. The Technical Factor page limit is also increased from 100 pages to 125 pages (see Final RFP Section L, Proposal Submission, paragraph (b) upon relase of Final RFP).

General As there are limitations on U.S./Canada-sourced .50 cal components, including no availability and/or limited competitive pricing (particularly cartridge cases), having .50 cal in the Second Source competition presents component sourcing difficulties for some vendors, does the U.S. Government have an opportunity to separate .50 cal from the Second Source competition? Competing .50 cal separately from 5.56 and 7.62 would increase vendor participation and price competitiveness.

The Government will not separate the Caliber .50 requirement. Being that this effort is the Second Source to the Lake City Army Ammunition Plant, the intent is to keep the Second Source contractor in steady production for readiness purposes.

Separating the Caliber .50 requirement negatively impacts that purpose.

Draft RFP, Page 4, Section A, paragraph (i) Due to the limitation of domestically sourced .50 cal cases from entities that are competing for this particular contract, would the U.S.

Government consider allowing .50 cal cases to be sourced outside the U.S. / Canada -- similar to the allowance for tracer and incindiary sourcing requirements? It is our belief that allowing .50 cal cases from OCONUS sources woud enable the most price competitive bids for this opportunity by ensuring that more vendors can participate.

The Government will not consider sourcing Caliber .50 cases OCONUS due to the increased risk.

Draft RFP, Page 4, Section A, paragraph (f) The U.S. Government identifies minimum ordering quantities for 5.56mm and 7.62mm. Does the U.S. Government have a forecasted or anticipated minimum ordering quantity for the .50 cal?

The Government does not have a minimum ordering quantity for Caliber .50 but has included Best Estimated Quantities (or BEQs) in the Final RFP applicable to each caliber family for each Ordering Period. The BEQ for 5.56mm is 20,000,000; 7.62mm is 12,000,000; and Caliber .50 is 4,500,000. See Final RFP Section A Narrative, paragraph

(f) upon release of Final RFP.

Draft RFP, Page 81, Section I, COST ACCOUNTING STANDARDS The solicitation includes several cost-related clauses (e.g., FAR 52.215-2, 52.215-21, 52.230-2, DFARS 252.231-7000, 252.242-7005) typically associated with cost-reimbursement or CAS-covered contracts. As this Program is a competitive Firm Fixed Price / Fixed Price with EPA contract, we request that the U.S. Army remove any CAS-related clauses from the RFP.

The Government concurs on removing 52.215-2, 52.215-21, 52.230-2, and 252.242- 7005 for the purposes of this RFP since adequate competition is anticipated. 252.231- 7000 remains in the RFP as it is applicable to potential negotiations of modifications during contract performance.

General As the Government is aware, the solicitation covers a range of DODICs and calls for high volume production. To provide a comprehensive, competitive, best value price to the Government, we respectfully request a forecast for anticipated product demand by ordering period for second source. Greater detail on planned needs will allow all bidders to optimize planning cycles and align purchasing strategies to reduce cost and provide more competitive, realistic pricing. This information is especially critical to the initial ordering periods.

See above comment regarding BEQs.

General Could the Government please advise the second vs primary source determination process? I.e., how does the Government determine which DODICs are built entirely at LCAAP and which are split between LCAAP and second source? Will the second source contractor primarily/only receive orders for the DODICs where their cost relative to LCAAP is the lowest, or is the determination based on LCAAP capacity limitations and second source is used only to fill those gaps?

Providing that the requirements and funding exist, the Government's intent is to keep the Second Source contractor producing throughout the life of the contract and reduce undue burdens to produce limited quantities of a specific DODIC.

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