20-66516 JA_Redacted.pdf

JUSTIFICATION FOR OTHER THAN

FULL AND OPEN COMPETITION

I. Agency and Contracting Activity.

This Justification and Approval is to request authority for Other Than Full and Open Competition supporting requirements generated for the 402d Electronics Maintenance Group (EMXG), 569th Electronics Maintenance Squadron and 402d Software Engineering Group (SWEG), 581st Software Engineering Squadron (SWES). The contracting activity for this requirement is AFSC/PZIMA. The Purchase Request number supporting this contracting action is F3QCCM0224A101, Budget Authorization Form FD2060-20-66516.

II. Nature and/or description of the action being approved.

Due to the circumstances described herein, the activity requests authority to acquire Versatile Diagnostic Automatic Test Station (VDATS) parts listed in the document using ‘Other than Full and Open Competition’ as prescribed by FAR 6.302-1, “Only One Responsible Source and No Other Supplies or Services Will Satisfy Agency Requirements”. This action will result in the award of a new contract which will be a five year, Firm Fixed Price (FFP), Requirements Indefinite Delivery Contract (IDC) with a basic one (1) year and four (4) annual Ordering Periods. The estimated contract award date is projected to be 15 December 2020. Orders may be issued on this Requirements IDC through 14 December 2025.

The source for this requirement is Corelis Incorporated.

Corelis Incorporated 13100 Alondra Blvd Ste 102 Cerritos, CA 90703

CAGE: 1KEB5

Small Business

III. Description of the supplies/services required to meet agency needs (including the estimated value).

The purpose of this acquisition is to procure the parts required to assemble the VDATS stations.

The VDATS is an organically designed test station with Open Architecture and Virtual Modular Equipment (VME) Extensions for Instrumentation (VXI) technology. The test station contains flexible hardware and software architectures that are fully expandable and customizable, and eliminate or reduce the need for active Interface Test Adapters (ITAs).

The VDATS consists of standardized, commercially available test equipment, components and software. There are two configurations of VDATS, the Digital Analog (DA)-1 and DA-2.

Additionally, there are augmentations that provide additional capability to the core DA racks:

Auxiliary Bays (ABs), Mission Equipment Support Sets (MESSs) and Radio Frequency (RFs) roll-up racks. Currently, these configurations support the A-10, B-1, B-2, B-52, C-5, C-17, C-

(AFLCMC/WNA) which maintains Operational, Safety, Suitability, and Effectiveness (OSS&E) authority. These parts are not stock listed and therefore were not screened.

IV. Statutory authority permitting other than full and open competition.

10 USC 2304(c)(1), as implemented by FAR 6.302-1, one responsible source and no other supplies or services will satisfy agency requirements.

V. Demonstration that the contractor’s unique qualifications or the nature of the acquisition requires use of the authority cited above (applicability of authority).

The agency’s minimum needs can only be satisfied by the unique supplies available from Corelis. Corelis is the OEM for these parts and is the only source capable of providing them.

These parts have been tested and approved for the VDATS and acquisition must remain restricted to the controlled baseline that is approved and tested for the VDATS.

There is currently no existing contract available to satisfy new FY21 through FY26 VDATS requirements. Therefore this instant acquisition is necessary for the continued production of a highly specialized system.

AFLCMC/WNA maintains OSS&E authority. The part numbers in this requirement may be altered but form, fit and function of the parts will not change. As such minor configuration changes may be required to accommodate operational needs or avoid obsolescence.

Configuration changes are approved by AFLCMC/WNA. EMXG is the procuring source in accordance with Acquisition Plan WRALC-0901 dated 05 July 2012. When obsolescence occurs, the 581st Software Integration Lab (SIL) will research the replacement parts and provide recommendations to WNA. All materials must be purchased as new, direct from the OEM in order to maintain configuration control and performance according to test station specifications.

The remaining life cycle for the VDATS system is 30 years.

To maintain strict configuration control of current production efforts and to comply with the technical requirements identified in the VDATS system technical documentation, the exact part number is required and must be procured in order to maintain the configuration control baseline and promote transportability of workload between test stations. In accordance with the DoD Automated Test Station (ATS) Selection Guide, which can be found at the following link:

https://www.acq.osd.mil/log/MPP/ats_library.html, program managers are mandated to select from appropriate, DoD approved ATS families to satisfy testing requirements.

Acquisition must remain restricted to the part number controlled baseline that is approved and tested for the VDATS ATS. Any change to the VDATS configuration potentially impacts every VDATS user and creates a ripple effect for software and firmware within Test Program Sets (TPS) for Line Replaceable Units or Shop Replacement Units (LRU/SRUs) tested on the VDATS Support Equipment.

Accordingly, Corelis is the only source capable of providing the supplies described in Section III above in accordance with the VDATS technical data package.

The Government does not own the data rights to these proprietary Corelis items. A request for purchase of data from Corelis was sent on 12 Aug 2020. Corelis replied on 9 Sept 2020 that they are unwilling to sell the data for these items to the Government. .

The DoD ATE framework that is shared by Air Force, Navy, Marines, and Army is structured around the use of Commercial off the Shelf (COTS) instruments. This is due to the difficulty of re-engineering those components; the measurement science that is required for National Institute of Standards and Technology (NIST)-traceable calibration adds a great degree of complexity to the design and sustainment of these instruments. In the event of obsolescence, AFLCMC/WNA would qualify a substitute COTS item.

Qualification of substitute parts only occurs due to obsolescence. The review of substitute parts is completed at a part number level, and each new part requires extensive regression testing to ensure uninterrupted production on over 2500 Test Program Sets (TPSs) that currently run on the VDATS platforms. The research required to qualify a part includes approximately 12 months of review/testing. The cost of 12 months of analysis, testing, and integration for one part in any of the VDATS configurations is estimated at $127,154.

Substitute Qualification Estimates Cost for all parts =Unit Cost for all parts + Cost for analysis,testing of all parts

$136,440 + (127,154 x 8) = $772,210

Requalification of individual parts from another vendor would add additional administrative costs such as duplication of contract efforts and supplying multiple vendors with required GFP for testing. It would also have significant detrimental effects to the delivery and EMXG’s manufacturing schedule as planning/forecasting obsolescence is difficult, if not impossible, to accomplish with enough certainty and lead time to establish alternate vendor procurement methods to meet existing performance requirements. Therefore, requalifying individual parts through alternate vendors is not a viable option. The VDATS program is capitalizing on commercial off the shelf items with pricing and availability directly tied to the commercial marketplace. On average, commercial pricing in the market fluctuates +/-10%. Historically, the government has received catalog pricing and quantity discounts up to 7% which will likely be lost if multiple alternate vendors are utilized. Based on historical purchase data, the most a competitive market would offer would be an additional 3% savings (see breakeven analysis below); therefore, it would take sixteen years to breakeven (recoupment of additional upfront costs through potential long-term savings); however the life expectancy of some of the parts is less than the breakeven due to the rapid changes in technology and obsolescence.

Breakeven analysis Average Part Cost $ 27,288.00

3% Savings per Part $ 818.64

Requalification cost per part $127,154.00 + $27,288.00= $154,442

Breakeven ‐ # of buys 189

Award to any other source would result in substantial duplication of cost to the Government that is not expected to be recovered through competition and unacceptable delays in fulfilling the Air Force’s requirements.

Unacceptable Delay: Award to any other source would result in unacceptable delays in fulfilling the Air Force’s requirements. The VDATS are highly specialized equipment; without serviceable assets that have been tested and approved, system performance in accordance with test station specifications will be placed at great risk. Lack of proper configuration impacts every VDATS, causing failure to execute mission or preventing the achievement of critical objectives. The DoD ATS Selection Guide mandates program managers select from appropriate, DoD approved ATS families to satisfy testing requirements. Significant delay would be realized if testing and approval are required from sources other than the OEM. The estimated timeline is based on a minimum of 18 months to prepare a competitive solicitation, and up to 48 months to test and approve each applicable part.

The items being acquired are critical to maintaining configuration control in all of the test stations. In order to maintain this control, Corelis is the only known source that can satisfy the Government’s requirement. Any attempts at Full and Open Competition at this time would cause a significant time delay. Therefore, this acquisition will be a new contract for the production of highly specialized equipment.

Accordingly, Corelis is the only firm capable of providing the supplies and services described in Section III above without the U.S. Air Force experiencing substantial duplication of cost that could not be expected to be recovered through competition and unacceptable delays in fulfilling its requirements.

VI. Description of efforts made to ensure that offers are solicited from as many potential sources as practicable, including whether a notice was or will be publicized as required by subpart 5.2 and, if not, which exception under FAR 5.202 applies.

A Sources Sought (SS)/Request for Information (RFI) synopsis was posted to beta.SAM on 11 Aug 2020 with a response date of 11 Sept 2020 under Notice Number: F3QCCM-Corelis titled Corelis VDATS Components. The SS/RFI requested responses from interested vendors that possess the experience to meet qualification requirements for this effort. No responses were received.

This requirement will be synopsized on beta.SAM in accordance with FAR 5.201. It is anticipated that sources having an interest in subcontracting may be identified through synopsis.

Any source who responds to the Government as a result of this synopsis will be identified to the prime contractor as a potential subcontracting possibility.

Avg Qty Purchased per year 12

# of years to Breakeven 16

VII. Determination by the Contracting Officer that the Anticipated Cost to the government will be fair and reasonable

The overall cost of this acquisition will be fair and reasonable to the Government. In accordance with FAR 15.403-3, the Contracting Officer will require the submission of other than certified cost or pricing data. Price analysis or cost analysis based on “information other than certified cost or pricing data” will be used to examine and evaluate the proposed prices to determine fair and reasonable pricing. Price analysis techniques include comparison of proposed prices to historical prices paid for a same or similar item; comparison with published price lists, offered catalog prices and prices obtained through market research for a same or similar item;

comparison of proposed prices with independent Government estimate; or analysis of data other than certified cost or pricing information.

VIII. Description of the market research conducted and the results, or a statement of the reasons market research was not conducted.

Market research in accordance with FAR Part 10.001 and 10.002 was conducted from 26 Jan 2020 through completion date 14 Sept 2020. Techniques used included posting a SS/RFI, conducting a search of the Small Business Dynamic Small Business Search (DSBS) engine and a General Services Administration (GSA) query.

As described in Section VI above, an SS/RFI was posted to beta.SAM advising industry of the pending acquisition and soliciting inquiries from interested vendors. The RFI was posted 11 Aug 2020 under Notice number F3QCCM-Corelis titled Corelis VDATS Components. No responses were received.

The Dynamic Small Business Search (DSBS) engine was queried using North America Industry Classification System (NAICS) code 334515 (Instrument Manufacturing for Measuring and Testing Electricity and Electrical Signals) and key words “Test Equipment”. A search for HUBZone, 8(a), Veteran, Woman Owned and Service Disabled Veteran Owned businesses was conducted and returned 94 vendors. Several sources for “test equipment” were identified, however, due to the proprietary nature of the parts being procured, none are capable of satisfying the requirement. A small business, Corelis, owns the proprietary data needed to maintain configuration control and performance according to test station specifications.

GSA was also queried to determine if these items were offered under a GSA schedule. None of the required items were found on GSA. Corelis confirmed they do not authorize third party resellers for any of their products and do not offer their products on a GSA schedule.

The VDATS is considered a commercial item as defined in FAR 2.101. The VDATS consists of standardized, commercially available test equipment, components and software.

The market research concluded Corelis is the only vendor capable of fulfilling the Government’s requirement.

IX. Any other facts supporting the use of Other Than Full and Open Competition.

None.

X. List of any sources that expressed, in writing, an interest in the acquisition.

See Section VI above.

XI. A Statement of the Actions, if any, the Agency May Take to Remove or Overcome any Barriers to Competition Before Making Subsequent Acquisitions for the Supplies or Services Required.

Acquisition must remain restricted to the controlled baseline that is approved and tested for the VDATS. A request for purchase of data from Corelis was sent on 11 Aug 2020. Corelis replied on 9 Sept 2020 that they are not willing to sell the technical data for any of these items to the Government.

While the current market research indicates a sole source environment for the VDATS, the Government will continue to engage with the OEM to determine the feasibility of procuring the Technical Data Package (TDP). Alternate sources of supply for equivalent parts are constantly being reviewed/evaluated in order to increase competition and system responsiveness. If a replacement for the VDATS is required in the future, competition would be considered.

XII. Certification by the Contracting Officer.

As evidenced by my signature above, I have determined this document to be both accurate and complete to the best of my knowledge and belief.

XIII. Certification by the technical/requirements personnel.

As evidenced by my (our) signature(s), I (we) certify that any supporting data contained herein, which is my (our) responsibility, is both accurate and complete.