Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: SATURDAY, July 24, 1993 TAG: 9307240142
SECTION: CURRENT PAGE: NRV-1 EDITION: NEW RIVER VALLEY
SOURCE: MICHAEL STOWE STAFF WRITER
DATELINE: BLACKSBURG LENGTH: Medium
The size of the proposal could delay the Army's decision on whether it will accept the deal, said Doug Borgeson, contracting officer for the U.S. Army Armament, Munitions & Chemical Command in Rock Island, Ill.
Army officials have said they would respond to commercial proposals within 72 hours, but Borgeson wouldn't commit Friday to that length of time on the DeNovo project.
"We just started getting proposals in the past few weeks," he said. "We've never looked at a proposal this big."
Toronto-based DeNovo hopes to be the first company at the Radford arsenal to capitalize on the ARMS act, a $200 million federal fund aimed at converting ammunition plants to commercial use.
The company wants to build a 100,000-square-foot facility at the arsenal that is expected to employ up to 120 workers.
With the Cold War over, the Army's demand for propellant has decreased and Hercules Inc., the government contractor for the plant, has laid off more than 2,000 workers in the past two years.
Rand Fishbein, a congressional staff member and author of the ARMS act, praised the New River Valley as a national leader in defense conversion efforts.
"While we had high hopes for Radford, you have vastly exceeded our expectations," he said. "The Radford Army Ammunition Plant is in the lead in demonstrating what the ARMS initiative can do for a community."
Fishbein pointed out that few communities have had the cooperation of local, federal and state officials.
He said the Army will be aggressive in its efforts to attract commercial business to the arsenal.
The Arms act is designed to provide companies incentives such as rent-free use of buildings, planning grants and loan guarantees.
DeNovo, for instance, is asking the Army to guarantee a loan that will finance most of the project. In addition the company is asking for "several hundred thousand dollars" to pay half the cost of a feasibility study and help upgrade the plant's infrastructure.
Borgeson said he hasn't looked at DeNovo's project yet, but that a decision on the project will probably be made next month.
A total of 19 companies - including engineering, manufacturing and service organizations - have expressed an interest in locating at the arsenal.
The next step in the process is for Hercules to finish a new facility contract with the Army to establish the rules commercial companies at the plant must follow.
Borgeson said the contract should be in place by Jan. 1.
Brecc Allevar, technical director for DeNovo, said his company hopes to strike a deal with the Army that will allow it to begin preliminary work on the pulp plant before Jan. 1.
The plant proposed for Radford would de-ink white paper with a special "steam explosion process" that eliminates the need for chemicals used in traditional de-inking facilities.
by CNB