A08_A-dec_Brand_Name_Justification_5-8-19.pdf

19-102-SOL-00026 Page 1 of 5

JUSTIFICATION FOR OTHER THAN FULL AND OPEN COMPETITION

Solicitation #19-102-SOL-00026: Poplar Ancillary Healthcare Facility & Vern E Gibbs Health

Center Renovation

I. Identification of Agency and Contracting Activity

Indian Health Service (IHS) Division of Engineering Services-Seattle 701 Fifth Ave, Suite 1600 Seattle, WA 98104

II. Nature and/or Description of the Action Being Approved:

a. Acquisition purpose and objectives.

Procurement of A-dec dental cabinetry, delivery systems and chairs for the new dental operatories at the White Buffalo Health Center in Poplar, MT. The purpose for purchasing ADEC dental equipment is to match the 5 existing ADEC operatories that will be reused in the new facility. This procurement will allow the Fort Peck Service Unit dental department to stay standardized with the same direct patient care equipment without duplicating costs unnecessarily. A dental operatory is a highly specialized space configured to deliver dental treatment to patients while supporting all associated tasks performed by the dentist and auxiliaries.

b. Project background.

The Fort Peck Service Unit will be increasing the total number of operatories from 5 to 10 with the construction of the new dental department. The new dental space will be furnished with 5 existing A-dec units that were purchased and installed in 2014. The Fort Peck Service Unit desires A-dec brand dental equipment for the continuity of dental patient care. If the equipment were to be different, the potential for errors during a dental procedure would increase due to the proprietary equipment setup from brand to brand. A potential error could cause grievous harm to patients and expose the government to liability.

III. Description of the Supplies or Services Required to Meet Agency Needs (including the estimated value):

A dental operatory consists:

Dental chair Dentist delivery unit Assistant delivery unit Examination light 12’Oclock and center pass through x-ray cabinetry.

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All pieces of an operatory are configured and function together as one unit. An average cost of an operatory is estimated at $24,000 for listed equipment, totaling $120,000.00 for the five new units.

IV. Identification of Statutory Authority Permitting Other Than Full and Open

Competition:

Pursuant to 41 U.S.C. 3304(a)(1), only one responsible source and no other supplies or services will satisfy agency requirements, without substantial duplication of cost to the Government that is not expected to be recovered through competition.

V. Demonstration That the Proposed Contractor’s Unique Qualifications or the Nature of the Acquisition Requires Use of the Authority Cited:

The nature of this acquisition with A-dec is unique due to the service unit already owning 5 dental operatories that will be reused in the new dental clinic. The general contractor of the project will have to contract with A-dec at an estimated cost of $10,000 to relocate the existing 5 operatories and recalibrate and ensure the functionality of each of the operatories in the new facility. If another product was to be introduced to the dental clinic it would cost the Fort Peck Service Unit an estimated $10,000 for training of dental and maintenance staff. Also, an installation fee for installing a different brand name of equipment at an estimated cost of $10,000. The current staff are trained on the operation and maintenance of A-dec equipment.

The facility has two maintenance workers that have been to an A-dec maintenance school to perform general maintenance. The FPSU dental department possesses an estimated value of $15,000 of maintenance kits, hand pieces and motors that are proprietary to A-dec equipment.

The introduction of another brand name would require the service unit to procure maintenance kits, hand pieces and motors. Due to the remote location of the Service Unit, it is imperative to have parts on hand to troubleshoot and fix if possible, because the closest vendor that works on dental equipment is 330 miles away.

VI. Description of Efforts Made to Ensure That Offers Are Solicited From as Many Potential

Sources as is Practicable, Including Whether a Notice Was or Will Be Publicized as Required by Subpart 5.2 and, if Not, Which Exception Under 5.202 Applies. :

The proposed contract action is made under conditions described in 6.302-5 with regard to brand name commercial items for authorized resale, and advance notice is not appropriate or reasonable.

This requirement is a sub-requirement for a larger construction effort. The larger effort, including the specifications for this requirement, were posted as part of a sources sought notice and were also available to the public when the pre-solicitation notice was published. Once the solicitation documents are posted, this justification will also be posted. Since the larger requirement, which this sub-requirement is a part of, will be competed on a full-and-open basis, it is expected that offerors will seek out the best value suppliers of this product competitively.

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VII. Determination By Contracting Officer That the Anticipated Cost to the Government Will be Fair and Reasonable:

In accordance with FAR 15.404-1, the contracting officer is responsible for evaluating the reasonableness of prices. The analytical techniques and procedures described in FAR 15.404- 1 may be used, singly or in combination with others, to ensure that the final price is fair and reasonable. The following price analysis techniques were used to evaluate the price for the A-dec equipment: Advice and assistance of other experts to ensure that an appropriate analysis was performed, such as the government engineers with experience in procuring these types of equipment, an examination of recent historical prices paid for this equipment and similar equipment, government estimates, and the project designer and Construction Contract Administration services contractor.

The cost of the A-dec equipment required for this project is fair and reasonable, because it will cost less than purchasing another brand of equipment that will incur additional life cycle costs that would not otherwise be required, such as training on the new equipment for maintenance workers and equipment operators, the loss of learning curve efficiencies, maintenance supplies, new infrastructure to support other brands, and re-design effort by the project Architect for new infrastructure.

The U.S. Air Force’s guidelines on variances between government estimates and prices notes:

“There should not be more than a 20% variance in the difference between the cost proposed, and the government estimate”1. The government estimate for the A-dec equipment compared to the estimated cost of new equipment and its related total cost of ownership revealed that each non-Adec unit purchased would cost an average minimum of $24,850.00 more per unit, or 75% more than A-dec equipment.

Additionally, other non-price value added characteristics were considered in determining if the cost to the government would be fair and reasonable such as:

Past Performance: The reliability of the A-dec brand of equipment at the Fort Peck Service

Unit has been unprecedented. In 2014, the existing five dental operatories replaced A-dec brand equipment that had been in service for 20 years. The A-dec brand has been the industry standard for years and is why the Billings Area has A-dec equipment in their dental operatories.

Probability of the Life of the Item(s) Selected Compared With That of a Comparable

Product: The A-dec brand has been proven for quality and durability. As stated above, if the equipment is maintained as recommended, the useful life could be expected to be 15 to 20 years. The A-dec brand has been the industry standard for years and is why the Billings Area has A-dec equipment in their dental operatories.

1 Government Estimate Training:

http://www.acq.osd.mil/dpap/ccap/cc/jcchb/Files/Topical/Govtestimates/trainin g/government_estimate_training_silver_flag.pptx

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Maintenance Availability: The unique ability for our own A-dec trained maintenance staff to troubleshoot and repair minor breakdowns. Due to the remoteness of the facilities, the service unit has the ability to contract preventative maintenance agreements with the closest maintenance company being an A-dec approved company, which is 330 miles away.

Based on the government estimate for the brand name product and its non-price advantages compared to the estimated cost of a new equipment, its related costs, and market research of other systems, the A-dec brand of equipment are determined to be the best value to the government consistent with FAR Part 15.302.

VIII. Description of Market Research Conducted and the Results or a Statement of the

Reason Market Research Was Not Conducted:

Market research for these requirements will be in accordance with FAR Part 10, and the requirement will be synopsized in accordance with FAR Subpart 5.207.

The market research was conducted on GSA-Advantage for different brands of needed dental operatory equipment Mr. Dana Matejovsky, IHS Mechanical Engineer. The equipment reviewed was either, lower quality or more expensive than the estimated cost of A-dec equipment. The lower quality equipment are produced in large quantities, which lacks quality of materials i.e. plastics, vinyl and metals compared to the A-dec brand. The quality causes the equipment to become susceptible to breakdowns and complete replacement. They also lack the versatility and efficiency for the provider during a patient care visit. The research was inconclusive on the required operatory cabinetry. The cabinetry found had a different footprint and would cost the service unit to spend more money in design change orders to accommodate a different brand.

Market Research Cost Summary:

BRAND BASE COST

PER UNIT

DUPLICATED

COSTS PER UNIT

PRICE

Belmont $4,500 $25,000 $29,500 A-dec $6,100 $0 $6,100 Midmark $7,400 $25,000 $32,400

Note: Duplicated costs: Training of staff, preventative maintenance agreements, parts, installation and design fees

IX. Any Other Facts Supporting the Use of Other Than Full and Open Competition:

A-Dec equipment has been industry standard for 25 plus years and the Billings Area Indian Health Service dental departments all utilize their equipment for the quality and overall dependability. A-dec holds an 80% share of the 18,000 plus dental operatory equipment in the market place. The Fort Peck Service Unit has access to a certified A-dec technician for any

19-102-SOL-00026 Page 5 of 5 repairs that the facility staff is unable to fix.

Current parts: $15,000 of maintenance kits, hand pieces and motors Current Preventative Maintenance program: $3,000 based on yearly contracted maintenance.

A-dec trained maintenance staff for repairs Continuity of patient care

X. A List of Sources, if Any, That Expressed, in Writing, an Interest in the Acquisition:

No suppliers of equipment similar to that supplied by A-dec expressed interest in this acquisition. A sources sought notice posted on FedBizzOpps (FBO) on February 25, 2019 for 15 days, which included the specifications for A-dec equipment, did not result in interest from other suppliers. Moreover, no interest has been expressed by suppliers during the subsequent FBO posting of the Pre-Solicitation notice for this requirement.

XI. Statement of Actions, if Any, the Agency May Take to Remove or Overcome Any

Barriers to Competition Before Any Subsequent Acquisition for the Supplies or Services Required:

Market research will be conducted to determine which socioeconomic categories have vendors with the capability of meeting the requirement and an appropriate acquisition strategy will be formed.

XII. Contracting Officer's Certification: As the Contracting Officer, I certify that this justification is complete and accurate to the best of my knowledge.

Prepared by: Reviewed by: Approved by:

Anthony R. Buch

Andrew hart

Melissa D. Warmath

Contract Specialist Supervisory Contracting Officer

OEHE Chief of Acquisitions

Date:

Date: May 8, 2019

Date: May 8, 2019

May 8, 2019