Army Arsenal Revitalization Act of 2016

To revitalize Army arsenals, and for other purposes. 1. Short title This Act may be cited as the Army Arsenal Revitalization Act of 2016 2. Definitions In this Act: (1) Congressional defense committees The term congressional defense committees (2) Legacy items The term legacy items (3) Organic industrial base The term organic industrial base 3. Use of arsenals to manufacture certain items (a) Production of legacy items (1) Report Not later than 180 days after the date of the enactment of this Act, the Director of the Defense Logistics Agency shall submit to the congressional defense committees a report listing all legacy items used by the Department of Defense with a contract value equal to or greater than $5,000,000. (2) Production requirement The Secretary of Defense shall use Army arsenals for the production of all legacy items identified in the report submitted under paragraph (1). (b) Use of sole source contracts for certain items (1) Report Not later than one year after the date of the enactment of this Act, the Secretary of Defense shall submit to the congressional defense committees a report listing all sole source contracts for the procurement of manufactured items the lack of which would constitute a critical national security issue for the Department of Defense. (2) Competition requirement The Secretary of Defense shall establish Army arsenals as a second source for production of any manufactured item included in the report submitted under paragraph (1). (c) Report on equipment purchased under domestic sole source contracts (1) Report Not later than March 30, 2017, the Secretary of Defense shall submit to the congressional defense committees a report containing a list of each contract awarded by the Department of Defense during fiscal years 2011 through 2015 using procedures other than competitive procedures for the procurement of equipment, weapons, weapons systems, components, subcomponents, or end-items with a contract value equal to or greater than $3,000,000. (2) Elements The report under paragraph (1) shall include, for each contract listed, the following information: (A) An identification of the items purchased under the contract. (B) The rationale for using an exception or waiver to award the contracts using procedures other than competitive procedures. (C) A list of potential alternative manufacturing sources from the public and private sector that could be developed to establish competition for those items. 4. Use of organic industrial base to address diminishing manufacturing sources and material shortages (a) Report Not later than one year after the date of the enactment of this Act, the Secretary of Defense shall submit to the congressional defense committees a report detailing plans to update and improve its guidance and practices on Diminishing Manufacturing Sources and Material Shortages (DMSMS), including through the use of the organic industrial base as a resource in the implementation of a DMSMS management plan. (b) Guidance regarding use of organic industrial base The Secretary of the Army shall maintain the arsenals with sufficient workloads to ensure affordability and technical competence in all critical capability areas by establishing, not later than March 30, 2017, clear, step-by-step, prescriptive guidance on the process for conducting make-or-buy analyses, including the use of the organic industrial base. (c) Identification of Army arsenal critical capabilities and minimum workloads (1) Report Not later than 180 days after the date of the enactment of this Act, the Secretary of Defense shall submit to the congressional defense committees a report that— (A) includes a standardized, consistent method to use for identifying the critical capabilities and minimum workloads of the Army arsenals; (B) provides analysis on the critical capabilities and minimum workloads for each of the manufacturing arsenals; and (C) identifies fundamental elements, such as steps, milestones, timeframes, and resources for implementing the United States Army Organic Industrial Base Strategic Plan 2012–2022. (2) Guidance Not later than one year after the date of the enactment of this Act, the Secretary of Defense shall issue guidance to implement the process for identifying the critical capabilities of the Army's manufacturing arsenals and the method for determining the minimum workload needed to sustain these capabilities. 5. Authority to adjust labor rates to reflect work production (a) Pilot program Not later than 90 days after the date of the enactment of this Act, the Secretary of Defense shall establish a three-year pilot program for the purpose of permitting Army arsenals to adjust their labor rates periodically throughout the year based upon changes in workload and other factors. (b) Annual report Not later than one year after the date of the enactment of this Act, and annually thereafter, the Secretary of Defense shall submit to the congressional defense committees a report that assesses— (1) each Army arsenal’s changes in labor rates throughout the previous year; (2) the ability of each arsenal to meet the costs of their working capital funds; and (3) the effect on arsenal workloads of labor rate changes.

Summary: Army Arsenal Revitalization Act of 2016 This bill requires the Defense Logistics Agency to report to Congress regarding Department of Defense (DOD) legacy items with a contract value equal to $5 million or more. DOD shall use Army arsenals for the production of these legacy items. DOD shall: (1) report to Congress listing all sole source contracts for the procurement of manufactured items the lack of which would constitute a critical national security issue, and (2) establish Army arsenals as a second source for production of any such manufactured item. DOD shall report to Congress regarding: DOD contracts awarded during FY2011-FY2015 using noncompetitive procedures for the procurement of equipment, weapons, weapons systems, and components with a contract value of $3 million or more; plans to update practices on Diminishing Manufacturing Sources and Material Shortages (DMSMS), including through the use of the organic industrial base as a resource in the implementation of a DMSMS management plan; and critical capabilities and minimum workloads of the Army arsenals, and fundamental elements for implementing the United States Army Organic Industrial Base Strategic Plan 2012-2022. DOD shall establish a three-year pilot program to permit Army arsenals to adjust their labor rates periodically throughout the year based upon changes in workload and other factors.