oContractNo.DE-NA0001942 SECTION J APPENDIX A STATEMENT OFWORK (0015, 0018,0075,0104) SectionJ,Appendix A,Page i oContractNo.DE-NA0001942 SECTION J APPENDIX A STATEMENT OFWORK TTable of Contents CHAPTER I. Objectives,Scope,and Requirements.........................................................................1 1.0 OBJECTIVE........................................................................................................................1 2.0 BACKGROUND.................................................................................................................2 2.1 The NNSA Mission......................................................................................................2 2.2 The NNSA Organization..............................................................................................2 2.3 Becoming an Enterprise................................................................................................2 2.4 Location of Performance..............................................................................................3 3.0 SCOPE.................................................................................................................................3 3.1 Mission.........................................................................................................................4 3.2 Merging of Operations..................................................................................................5 3.3 Scope and Financial Management................................................................................5 3.4 Enterprise Success........................................................................................................6 4.0 ADMINISTRATIVEANDTECHNICALREQUIREMENTS...........................................7 4.1 Integrated Safety Management (ISM), Integrated Safeguards and Security Management (ISSM), Environmental Management System (EMS), and Quality Assurance Systems (QAS).................................................................................................7 4.2 Work Authorization (WA) System...............................................................................7 4.3 Information Technology (IT)........................................................................................7 4.4 Governance...................................................................................................................8 4.5 Contractor Human Resources.....................................................................................10 4.6 Environmental Permits and Applications...................................................................10 4.7 Defense Nuclear Facilities Safety Board and Other Government Agencies Support and Liaison.......................................................................................................................11 4.8 Interfaces with Other Site Users.................................................................................11 4.9 Privacy Act System of Records..................................................................................12 4.10 ....................................................................................................................... Cost Reduction 12 CHAPTER II. WorkScope Structure..............................................................................................13 1.0 PROGRAMS......................................................................................................................13 1.1 Defense Programs.......................................................................................................13 1.2 Other NNSA Work.....................................................................................................16 1.3 Work for Others/Other Reimbursable Work...............................................................19 2.0 FUNCTIONALSUPPORT................................................................................................19 2.1 GeneralSupport:.........................................................................................................19 2.2 Mission Support..........................................................................................................19 2.3 SiteSpecific Support...................................................................................................20 CHAPTER III. HumanResources...................................................................................................21 1.0 DEFINITIONS...................................................................................................................21 2.0 WORKFORCE TRANSITION..........................................................................................21 2.1 StaffingPlan...............................................................................................................21 2.2 Pay & Benefits............................................................................................................21 2.3 Incumbent Employees Right of First Refusal.............................................................22 2.4 Advance Understanding on Human Resources...........................................................22 SectionJ,Appendix A,Page ii oContractNo.DE-NA0001942 3.0 COMPENSATION.................................................................................................................23 3.1 Total CompensationSystem...........................................................................................23 3.2 Cash Compensation....................................................................................................23 3.2.1Additional Compensation System Self-Assessment Data.......................................24 3.2.2 Proposed Major Compensation Program Design Changes......................................24 3.2.3 Annual Compensation Increase Plan (CIP).............................................................24 3.2.4Compensation Actions for All Key Personnel.........................................................25 3.2.5Incentive Compensation Plan..................................................................................25 3.2.6Assignments Outside of Normal Duty Station........................................................26 3.2.7Contractor’s Total Compensation System...............................................................26 3.2.8 Human Resources Plan............................................................................................26 3.3 Reports and Information: Compensation....................................................................26 4.0 BENEFITS.........................................................................................................................28 4.1 AssumptionofExistingPensionPlan.........................................................................28 4.2 Reports and Information: Benefits..............................................................................30 4.3 Workers’ Compensation.............................................................................................30 4.4 Pension Plans..............................................................................................................30 4.5 PensionManagementPlan..........................................................................................35 5.0 LABORRELATIONS.......................................................................................................38 6.0 WORKFORCEPLANNING..............................................................................................39 6.1 WorkforcePlanning-General....................................................................................39 6.2 Reductions in Contractor Employment –Workforce Restructuring...........................39 CHAPTERIV. Uranium ProcessingFacility(UPF) .......................................................................41 1.0 INTRODUCTION.............................................................................................................41 2.0 BACKGROUND...............................................................................................................41 3.0 ACQUISITIONSTRATEGY.............................................................................................41 4.0 ROLESOFTHEDESIGNAUTHORITYANDDESIGNAGENT.................................41 5.0 DESIGNCODEOFRECORD..........................................................................................40 6.0 FUNCTIONALORGANIZATION...................................................................................41 7.0 GOALSANDOBJECTIVES............................................................................................41 8.0 PROJECTDESCRIPTION................................................................................................42 9.0 PROJECTGOALSANDMILESTONES..........................................................................43 10.0 COSTREQUIREMENTS..................................................................................................44 11.0 PROJECTDELIVERABLES 5)........................................................................................44 SectionJ,Appendix A,Page iii oContractNo.DE-NA0001942 CHAPTER I. Objectives,Scope,and Requirements 1.0 OBJECTIVE The objective ofthis Contractis to obtainnuclearproductionservices to support National Nuclear SecurityAdministration(NNSA) andbroadernational securityrequirements. This objective includes obtainingservicesto meet theproduction requirements derivedfrom the nuclear weapons stockpileplanupdated andreleasedbythePresident oftheUnitedStates annually. TheContractor shall befullyresponsiblefor high-hazardenricheduranium,special nuclear material (SNM),high-explosive andnuclear weaponassembly/disassemblyfunctions to support NNSAStockpile Stewardship andManagement Program activities directedbytheOffice ofDefensePrograms (DP).The Contractor shall function as thesingle integratingcontractor for schedulingparts andperformingmateriallogisticswithintheNuclear SecurityEnterprise (NSE). The Contractor shall provideasingle management structure andinterface totheGovernment for integratingproduction across theNSE. NNSA tritiumsupplymanagement functions arealso included in Contractor responsibilities if this option is exercised. Furthermore,theContractorshall directlysupport theNNSA Offices of NavalReactors andNuclear Non-Proliferationin additionto other Department ofEnergy(DOE) offices. BeyondDOE/NNSA,theContractor shall provide uniqueservices to ongoingmissions for other Government agencies orprivatelyowned organizations on anon-interference basis with theDOE/NNSA workload. This statement ofworkincludes twoContract Line ItemNumbers (CLINs). CLIN 0001 covers themanagement and operationofPantex andY-12for theinitial five yearbase withsub-CLINs for three option periods, transitionofSRTO,andinclusionofSRTO,respectively. CLIN 0002 coverstheUraniumProcessingFacility(UPF) at Y-12. Inaddition to achievingPresidential goals outlinedin theApril 2010Nuclear Posture Review, this Contractwill fullysupport theDOE andNNSAStrategic Plans andwill strengthen NNSA’s vision for afullyintegrated andinterdependent Nuclear SecurityEnterprise (NSE),consistingof all eightNNSA sites,byachievingthefollowingfourspecific objectives: (i) Improvingperformance inthecompletionofnational securitymissions for nuclear productionoperations; (ii) Transitioningandmergingoperations at geographically-dispersed centers ofexcellence for: nuclear weapon assembly/disassembly; enricheduranium;SNM; high-explosive production; and,tritiumsupplymanagement underasingle Contract; (iii) Reducingthecost ofperformingwork; and (iv) Requiringactions thatsupport operationas anintegratedDOE/NNSA enterprise. ThisContract does not affect thephysicallocationofnuclear productioncenterofexcellence designations at therespective sites. SectionJ,Appendix A,Page 1 ContractNo.DE-NA0001942 2.0 BACKGROUND 2.1 The NNSA Mission The NNSA,establishedbyCongress pertheNNSAAct (Title XXXIIofthe National Defense Authorization Act for Fiscal Year 2000, PublicLaw106-65)as a semiautonomous elementwithinDOE,is responsible for themanagement and securityof thenation’snuclear weapons, non-proliferation,andnaval propulsion programs. It also respondsto nuclear andradiological emergencies intheUnited States andabroad,and NNSA federal agents providesafeandsecure transportation ofnuclear weapons, components andspecial nuclear materials. 2.2 The NNSA Organization NNSA relies onManagement andOperating(M&O) Contractors to manageday-to- day siteoperations andto adhere to its policieswhenoperatingits laboratories, production plants,andother facilities in theNSE. Together,theM&O Contractors implement NNSA’s all-encompassingStockpile StewardshipProgram managedby Defense Programs thatincludesoperations associatedwithsurveillance, assessment,maintenance, refurbishment,manufacture anddismantlement ofthe nuclearweapons stockpileas well as research,development andcertification efforts. 2.3 Becoming an Enterprise Overall,theNNSAneeds to carryout its mission withinresearch,development,and manufacturingorganizations that are safe,secure,integrated,efficient,and cost effective. Work must bealignedwith requirements received from keycustomers in amanner that strives to retaintheintellectual excellence andkeyinfrastructure capabilities demanded bynational interests. Throughout the1990s, theDOE/NNSA took stepsto consolidate to its current configurationofthreenational laboratories,fourproduction plants,andanuclear test site. InanevaluationoftheNSEcompletedin October2008,NNSA published a SupplementalProgrammatic Environmental Impact Statement (SPEIS) that analyzed alternatives fortransformingthecomplex into asmaller more efficient enterprise that respondsto changingnational securitychallenges andensures the long-termsafety, security,andreliabilityofthenuclear weapons stockpile. Two Records of Decision (RODs) informedbythis SPEIS were published in December 2008. WhiletheRODs look at transformingthephysical infrastructure,other initiatives have beenundertakento improvemanagement andbusiness practices. Two councils have beenformed: oneamong theContractor senior managementand another amongthe federal sitemanagers. Themainfunctionofthesecouncils is to improve theintegration andcommunicationwithintheenterprise. Also, governance reform is anNNSA managementinitiative that focuses on developing a partneringrelationshipbetweenthe federalteam and thesupportingM&O Contractors. SectionJ,Appendix A,Page 2 ContractNo.DE-NA0001942 2.4 Location of Performance The three sites underthis Contract are: 2.4.1 Y-12National SecurityComplex (Y-12): Y-12is aGovernment-ownedsite locatedin OakRidge,Tennessee, on approximately800acres withinthe 34,000 acreOakRidge Reservation. The NNSA facilities atY-12consist of over350 buildings withapproximately5,800,000 gross square feet (gsf). Another 1,730,000gsfarefacilities that are theresponsibilityoftheOffice ofScience, Office ofNuclear Energy, ortheOffice ofEnvironmental Management. 2.4.2 Pantex Plant (PX): PXisaGovernment-ownedsitelocatednearAmarillo, Texas, on approximately10,500 acres atPantex Plant proper and1,100 acres ofdetached propertycalledPantex Lake,approximately2.5 miles northeast ofthemainplant site. Inaddition,PXleases 5,800acres south of theplant as asecuritybuffer and owns approximately1,526acres ofland east ofFM2373 that provides an additional securitybufferandis beingused primarilyforagricultureandlocation ofthePantex Wind Farm. The total acreage underFederal control is approximately17,400 acres. The facilities on thesiteconsist of638buildings comprisingapproximately3,110,000 gsf.. 2.4.3 SavannahRiver Tritium Operations (SRTO): SRTO is withintheSavannah River Site(SRS) whichis aGovernment-ownedEnvironmental Management site locatedin south-central South Carolina andoccupies approximately198,420acres in Aiken,Barnwell,and Allendale Counties. SRSis approximately15 miles southeast ofAugusta,Georgia, and12miles south ofAiken,South Carolina.The NNSA SRTO consists of approximatelytwenty-nine acres centrallylocated withinthesite. The SRTO facilityis comprisedof32buildings consistingof approximately 377,809 gsf. 3.0 SCOPE ThisContract is comprehensive withanobjective toperform all necessaryoperational, coordination,andmanagement functions at Y-12,PX,andSRTO (shouldthis option be exercised) requiredto support NNSA andbroadernational securitymissions assignedto these sites. This includes but is not limitedto all ongoingmissions andfunctions, as well as thosethat maybeassignedduringtheterm oftheContract. Itfurther includes all infrastructure management andmaintenance;informationtechnology; humanresource management including critical skills recruitment andretention; environmental management; health, safetyandsecurity systems; andpurchasing andother administrativesystems. Intheexecutionofthis Contract,andparticularlyprogramintegration, theContractor shallmeet rigorous qualityand reliabilitystandards essential for theU.S.nuclear deterrent; maintain sufficient productioncapacityandproduceat rates definedin planningdocuments; and implement flexibleproductionmanagement and execution processes to accommodateadynamic national securityenvironment. The Contractor shall balanceriskmanagement andcostreduction initiatives to provide increasedvalueto theGovernment. This applies both internallyto this Contract andto improvingtheoverall cost efficiencyoftheNSE. SectionJ,Appendix A,Page 3 ContractNo.DE-NA0001942 The Contractor shall befullyresponsible and accountablefor thesafeandsecure accomplishment ofall work, whether performedbyits ownpersonnel orteam members, includingsubcontractors. The Contractor shall beresponsible for planning andcoordinating productionschedules;integrating,managingand executingtheprograms;supportingand executinglargeandsmall projects; andcompletingoperations andotheractivities asdescribedin this Statement ofWork. 3.1 Mission The Contractor shall safelyandsecurelycompleteallmission responsibilities and improve performance in thecompletionofnational securitymissions for nuclear productionoperations and allother nationalsecuritymissions, as applicable. NNSA has aWork BreakdownStructure (WBS) thatis discussed furtherin Section J,Appendix F, Work BreakdownStructure. At aminimum, theContractor shall: (i) Sustainthenecessaryworkforce andexerciseessential capabilities for: nuclear weaponassembly/disassembly,enricheduranium andlithium, SNM, high-explosiveproduction,andtritium supplymanagement centers of excellence; (ii) Maintainauthorizationbasis for high-hazardoperations; (iii) Operate high-hazardchemical processingfacilities andsystemswithin approvedauthorizationbasis; (iv) Assure theavailability of corecapabilities,regardlessofstockpile size; (v) Implement andoversee thenuclear explosiveandweaponssurety program to include nuclear weapon/nuclearexplosivesafety,security anduse control; (vi) Sustainandmodernize theinfrastructure; (vii) Interface withandsupport other contractorsperforming workat any ofthe sites; (viii) Balance available resourcesto meetmission requirementsandinfrastructure sustainment while maintainingsafe,secure,environmentally compliant and responsive operations;and (ix) Effectivelypartnerwithother Contractors withintheNSE to manage the masterschedule forall production activities andberesponsiblefor the executionof uranium,SNM,highexplosives, nuclear weapons assembly/disassembly, dismantlement, andsurveillance functions in support oftheStockpile StewardshipProgram.In performing this responsibility, issues betweenthe NSE contractorswillbebroughtto Defense Programs managementforresolution. SectionJ,Appendix A,Page 4 ContractNo.DE-NA0001942 3.2 Merging of Operations The Contractor shallmerge operations,in accordancewithSectionJ,Appendix D, Merger TransformationPlan,at geographically-dispersedcenters ofexcellence for: nuclear weapon assembly/disassembly; enricheduranium;SNM; high-explosive production; and,tritiumsupplymanagement (ifexercisedbyoption)under asingle Contract. At aminimum, theMergerTransformationPlanshall describe howthe Contractor will: (i) Manage merger ofoperationswithoutnegativelyimpacting mission; (ii) Ensure criticalskills necessary to maintain capabilities; (iii) Identify andstreamline redundanttechnical andbusiness operations acrossthe sitesunder this Contract; (iv) Incorporategovernance (SectionJ, AppendixA,ChapterI, 4.4); and (v) Maintainrelationships and regulatory interfaces,and assume responsibility for permitswithlocal,State andFederalentities,other DOE offices,and stakeholders. 3.3 Scope and Financial Management The Contractor shall support theDOE/NNSA Planning,Programming, Budgeting and Evaluation(PPBE) process. InsupportingPPBE,theContractor shallprovide financial data for Government systems, such as: (cid:120) StandardAccountingandReportingSystem (STARS) o STARS informationis providedunder theInstitutionalCost Reporting Categories (cid:120) iMANAGE (cid:120) Enterprise PortfolioAnalysis Tool (EPAT) o The EPAT informationshall becollected in accordancewiththeWork BreakdownStructure (WBS) (seeSectionJ,Appendix F) (cid:120) Facilities InformationManagement System (FIMS) The Contractor shallmaintain financial cost reportingsystems to provide detailed cost reports forcost,scope, and schedule fordirect and indirect costs for allwork performed under this Contract. Thecost reportsshall includelabor costs, leave/hours not worked, staff augmentation,fringe,pension,legacy,materials, services-subcontractors,direct servicecenters,otherexpenses,capital,labor category, andfull-time equivalent (FTE) resource usagefor all direct andindirect costs and utilizecostbenefit analyses to determine theappropriatelevel ofsupport functions andrisks. The Contractor shall provide NNSA transparencyinto those financial cost reportingsystems and shall provide routine reports to allowNNSA visibilityinto program andcostmanagementsupporting reports to external sources (see SectionJ,Appendix O). The Contractor’s financial cost reporting systemsshallsupporttheDOE STARS,iMANAGE,EPAT and support systems, suchas FIMS,as well asother Government systems as theyaredevelopedand implemented. SectionJ,Appendix A,Page 5 ContractNo.DE-NA0001942 The NNSA willprovide theinitialcostinformation, FTE dataandscope frameworkon theeffective date ofthe Contract. The Contractor shalldevelopa baseline for allContractor directprogramsandindirectsupport costs in accordance withDOEinstitutional costreportingcategories asfoundin SectionJ, Appendix M, InstitutionalCost Reporting,andutilizetheWBS reportingstructure forfurther program granularity,as applicableandasit continues to developwithinNNSA. The baseline shall includecost,scope ofwork, andschedule withachangecontrol process. Baselines willbe utilized for implementingthecostreductionfeatures under this Contract.Thebaselinewillbereviewedandapprovedannually by the ContractingOfficer. The Contractor shallhavein place tools to: 1)managemission andindirect changesin scope,cost,andschedule; 2)compareactual costsofworkperformed (ACWP)to budgetedcostsofworkperformed(BCWP);3)accurately forecast estimatedcoststo complete (ETC) andestimatedtotalcosts at completion(EAC); and4)document deviations fromthebaselines describedabove in this paragraph and,on atimely basis,notify theContractingOfficer ofsuch changes.The Contractor shallnot make retroactive changesto recordspertainingto work performedthat will change previously-reportedcosts,exceptforcorrectionof errorsandroutine accountingadjustments andnot make retroactive changesfor funding fluctuationsorrevisionsin EAC. 3.4 Enterprise Success The Contractor shall participatewithNNSA andotherNNSA M&OContractors as part ofan "enterprise organization"to evaluate,plan, developandimplement strategic initiative activities thatoptimize missionandbusinessoperationsacross theNSE.The goal oftheseinitiatives is to increase theefficiencyand cost effectiveness from a business andmission perspective,to include: (cid:120) Reducedoperational costs enterprise-wide, (cid:120) More consistent workpractices andoperational processes, (cid:120) Better pricing,better products, more timely delivery, (cid:120) Reducedadministrative costs andleadtimes for both theContractor andthe DOE/NNSA, (cid:120) Greater standardization andinterchangeabilityacross theNSE;and (cid:120) Increasedawardsto small businessentities. NNSA expectsthese andother initiativesto resultin ashiftto anenterprisefocus, basedon theContractor whopossesses themost expertise andexperience level within theNSE. The Contractor shallcooperate withNNSAandNSEContractorsin identifying potential cross-NSE benefitsto be derivedfromimplementing commonpractices and goalsacrosstheNSE in theareasof mission workloadandenterprise functional support. The ContractorandNNSAshall establishperformance incentives withperformance measuresandtargetsfor strategic effortsthatresult in enterprise performance improvementoverallfor theGovernment. SectionJ,Appendix A,Page 6 ContractNo.DE-NA0001942 4.0ADMINISTRATIVEANDTECHNICALREQUIREMENTS 4.1 Integrated Safety Management (ISM), Integrated Safeguards and Security Management (ISSM), Environmental ManagementSystem (EMS), and Quality Assurance Systems (QAS) The Contractor shall ensurethat ISM, ISSM,EMS, andQAS are integratedinto its operations andthat its Contractor AssuranceSystem (CAS) reflectsContractor integrated performancerelatedto thesesystems. 4.2 Work Authorization (WA) System Specific workrequirements under this Contract will beestablishedannuallyandupdated as neededbytheContractingOfficer in accordancewiththeapplicableDOEOrderand theContract’sSection IClause entitled“DEAR 970.5211-1, Work Authorization.” 4.3 Information Technology (IT) The NNSA seeksto optimizetheefficiencyofthe NSE throughtheNNSANetwork Vision(2NV) that seeks toconsolidate ITinfrastructure/services and eliminate redundant systems,to increase efficiencythroughmobilityand cloudcomputing,andto improve businessprocesses to betterintegrateacross sites. Toaccomplishthesegoals,the Contractor must evaluatefeasibilityofremovingredundant systems bycompletinga careful examinationofexistingsystems and architecture across thesites todevelopa single,integrated“to-be”vision thatutilizes thebest available technologies and managementpractices from both Governmentand commercialsources toimprove and achieve performanceexcellence, includingfiscal efficiency.With respect to production, these efforts shallinclude,but are not limitedto, theimplementationofmulti-site, integratedmanufacturingbasedinformationsystems that support weapons production, specialnuclearmaterial (SNM)accountability,production schedulingand flow, surveillance,weaponretirement,processknowledgearchiving,andpreservation of productionandcertificationrecords. Desktopandback-officecomputingcapabilities should becompatible withthoseusedbyNNSA entities. Back-officefunctions shall include,but not belimitedto, payroll,finance,project management,humanresources, etc. The Contractor shalldeliver,within180days oftheBase Term,adraft “to-be” architecture andinformation technologytransition planthatintegrates production and businesssystems atPantex andY-12,andfurtherconsidersintegrationofSRTO as directedbytheGovernment in amanner that is consistent withtheoverall enterpriseand yields thebest valueto theGovernment. This planshallpresent acost andschedule baseline against whichperformancecanbemeasured. Specifically,theplan must address networkconsolidation to generate cost efficiencies,mobilityto replace manual processes andfacilitateamobilework environment,datacenter consolidationto generateenergy savings,and cloudcomputingto improve business agility. Inaddition,theplanmust consider (wherefeasible)replacement oflegacyapplicationswithCommercial Off the Shelf (COTS) systems,elimination ofredundant IT systems, and collectionofdata in accordance withDOE orindustrystandardsto improve NSE interoperability. SectionJ,Appendix A,Page 7