Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: FRIDAY, August 4, 1995 TAG: 9508040061
SECTION: VIRGINIA PAGE: A1 EDITION: METRO
SOURCE: STEPHEN FOSTER STAFF WRITER
DATELINE: FAIRLAWN LENGTH: Medium
New jobs - 130 of them - are coming to the Radford Army Ammunition Plant, officials announced Thursday.
Alliant Techsystems Inc., which took over operation of the arsenal from Hercules Inc. less than five months ago, will transfer gunpowder manufacturing operations from its Kenvil, N.J., plant to the arsenal by December 1996.
These will be the first new jobs created at the layoff-beleaguered arsenal in three years, said plant manager Richard Best.
Although the company rehired 74 workers a year ago to complete a contract, those were employees who had been laid off. They were let go again at the end of the year after the contract was completed.
After downsizing for more than three years - cutting employment from around 3,000 three years ago to 1,213 today - the prospect of new jobs inspired some excitement.
"It's a win-win for everyone," Best said.
Three events smoothed the way: passage of a federal bill three years ago aimed at helping defense-oriented companies convert to commercial operations; signing of a contract between the U.S. Army and Hercules in January; and some ear-bending of Gov. George Allen by local government officials last month.
While Alliant said it will invest $8 million to make the move, it could receive up to three times that amount in federal funds through the Armament Retooling and Manufacturing Support initiative, passed in 1992.
Rep. Rick Boucher, D-Abingdon, said $24 million in ARMS money will go toward refurbishing aging buildings inside the arsenal and making them usable. The company said the total amount had not been determined.
The company also could receive up to $1.1 million from the state and local governments for relocation costs, employee training and site preparation, officials said.
Alliant's new facility will be named New River Energetics and will be separate from the current arsenal operations. It will make gunpowder for companies such as Remington and Federal Cartridge.
The move is the first made possible under the facilities contract signed by Hercules and the Army in January. The contract allows the Army to trim overhead costs by having other companies maintain some of the plant's buildings, roads and equipment that would normally sit idle and deteriorate.
Before the contract, Army regulations prohibited the arsenal's operator from bringing private companies into the plant.
"Without the facilities contract, we couldn't have any tenants," Best said. With the contract, company officials hope to reduce the costs of operating the entire plant - and thereby reduce the cost of making propellant for the Army.
Boucher said he had talked with Hercules officials as early as five years ago about relocating the Kenvil operation to the New River Valley. Some farm sites were toured and the possibility of taking out options on land was discussed.
But the company thought that the costs of purchasing acreage, constructing new buildings, shutting down the Kenvil operation and relocating would have been too high.
"Hercules saw the advantage of moving," Boucher said. But "all of the costs taken together were too high."
The ARMS money and facilities contract change that.
"I think it bodes well for the future," Boucher said. "This obviously is the first commercial work to come to the arsenal. It will not be the last."
Montgomery County has applied for a loan of up to $700,000 and a $150,000 matching grant from the Governor's Opportunity Fund, which it would give to Alliant to relocate, said Larry Linkous, chairman of the county Board of Supervisors.
That money hasn't been committed yet, but Morgan Stewart, spokesman for the Department of Commerce and Trade, said, "The importance of the development [means] we are giving this some priority." The state will give Alliant an undetermined amount of money for employee training.
Linkous said the deal may have been solidified after Allen, in town two weeks ago, assured him and company officials that the state would look favorably on the county's application for money.
Nicole Kinser, public affairs spokeswoman for the arsenal, agreed. While Congress may reappropriate the ARMS initiative with $45 million, Alliant had until the end of September to apply for current ARMS funds. It believed it needed assurances that it would receive some money for relocating, in addition to the ARMS funds, which have limitations on their use.
"The governor's support meant a lot," Kinser said. "We were on a deadline."
New River Energetics will bring in revenue for the county because it will be a private company that will pay taxes, unlike the government-owned operations at the arsenal, Linkous said.
"We're really pleased that it's a commercial-oriented facility," he said. "It's great for Montgomery County.
"Hopefully, this is the start of something that can continue there."
by CNB