20231218_USC10_JA_Redacted_Final.pdf

SOURCE SELECTION INFORMt~TION See FAR 2.101 and 3.104

JUSTIFICATION AND APPROVAL (J&A)

USTRANSCOM JUSTIFICATION FOR

OTHER THAN FULL AND OPEN COMPETITION

UNIVERSAL SERVICES CONTRACT - 10 (USC-10)

Justification Control Number: 24-06

1. CONTRACTING ACTIVITY.

United States Transportation Command (USTRANSCOM), Acquisition Directorate Sealift Services Division (TCAQ-I) 508 Scott Drive, Scott AFB, Illinois 62225-5357

2. NATURE AND/OR DESCRIPTION OF ACTION BEING APPROVED.

The objective of the USC-IO acquisition is to recompete and award new Fixed-Price with Economic Price Adjustment (EPA) contracts for the longstanding USC requirement, limiting competition to vessel owning or controlling companies. TCAQ-I contemplates awarding multiple, Indefinite Delivery/Indefinite Quantity (IDIQ) contracts with EPA for the allowance of fluctuations in marine fuel prices (Bunker Adjustment Factor), foreign currency exchange rates (Currency Adjustment Factor), and inland Continental United States fuel prices (Fuel Adjustment Factor) for international and domestic surface transportation using intermodal services of ocean carriers.

New entrants to the marketplace offering U.S.-flag or combination U.S.-flag service where only foreign flag service exists, may be awarded a contract anytime during the contract periods as required by the U.S.

Military Cargo Preference Act of 1904 (10 United States Code (U.S.C.) § 2631). Such awards shall only be made to offerors who are vessel owning or controlling carriers, propose fair and reasonable pricing, and have an acceptable business and technical proposal.

3. DESCRIPTION OF THE SUPPLIES/SERVICES REQUIRED TO MEET THE AGENCY'S

NEEDS.

The purpose of this acquisition is to provide domestic and international cargo transportation and distribution services using ocean common or contract carriers, as defined in the Shipping Act of 1984, offering regularly scheduled commercial liner service for requirements that may arise in any part of the world, including service covered by the Jones Act (see generally, Title 46, United States Code (U.S.C.), Chapter 5 51, Coastwise Trade and related statutes). This contract is primarily for requirements owned and shipped by the Department of Defense (DoD), to include items otherwise transported by the DoD such as Foreign Military Sales, Humanitarian Assistance Programs, shipments from commercial entities for use by DoD (e.g., Defense Logistics Agency's Prime Vendor Program), Household Goods and Privately Owned Vehicles owned by DoD service members and employees, and shipments by the armed tYI

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Controlled by: USTRANSCOM Controlled by: Directorate of Acquisition CUI Category/ies: 8SEb Limited Dis ntr l • -i-¥-H4-JN-1-,-¥-

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SOURCE SELECTION INFORMATION SEE Fl& l .101 A .. 'ltffl 3.104 forces of allied and partner nations. In addition, this contract may be used for shipments by United States Federal Agencies other than DoD.

The contracts will be awarded with a performance period of one (1) one-year base period, four (4) one year option periods, and an optional six-month extension in accordance with Federal Acquisition Regulation (FAR) 52.217-8, Option to Extend Services.

Period Base Period Option Period 1 Option Period 2 Option Period 3 Option Period 4 6 Month Extension

Period of Performance Dates 1 September 2024 - 31 August 2025 1 September 2025 - 31 August 2026 1 September 2026 - 31 August 2027 1 September 2027 - 31 August 2028 1 September 2028 - 31 August 2029 1 September 2029-28 February 2030

The total estimated value of this procurement is extension).

(including the optional 6-month

The estimate is derived from current contract costs, forecasted cargo volumes, and anticipated cost increases due to forecasted market conditions.

The USC-10 requirement will encompass approximately 64,000 lines of rates and cover geographical areas not covered by other contracts. There are approximately 100 trade lanes covered by the USC program and the lanes apply to both inbound and outbound cargo movement.

Route

Description U.S. West Coast- Far East Continental Europe, United Kingdom. Ireland - Middle East. South Asia, Indian Ocean U.S. West Coast- Hawaii Middle East, South Asia, Indian Ocean Interport U.S. East Coast- Continental Europe, United Kingdom, Ireland U.S. East Coast- Mediterranean U.S. East Coast- Middle East, South Asia, Indian Ocean U.S. East Coast - Far East U.S. East Coast - Hawaii U.S. Gulf Coast- Scandinavia, Baltic Sea U.S. Gulf Coast-Continental Europe, United Kingdom. Ireland U.S. Gulf Coast- Mediterranean U.S. Gulf Coast- Middle East, South Asia, Indian Ocean U.S. Gulf Coast - Far East U.S. Gulf Coast - Hawaii Hawaii-Far East U.S. Great Lakes-Continental Europe, United Kingdom, Ireland Caribbean Interport Far East Interport Mediterranean Interport Canada East Coast - Mediterranean

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Route

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SOURCE SELECTION INFORMATION SEE Fl& l .101 A .. 'ltffl 3.104

Description Canada East Coast - Continental Europe, United Kingdom, Ireland U.S. West Coast- Continental Europe, United Kingdom, Ireland Scandinavia, Baltic - Continental Europe, United Kingdom, Ireland U.S. West Coast - Mediterranean U.S. West Coast-Alaska Hawaii - Continental Europe, United Kingdom, Ireland U.S. West Coast- Central America/Mexico Alaska Interport U.S. East Coast - Greenland U.S. East Coast - Iceland U.S. East Coast- Scandinavia, Baltic Sea U.S. East Coast - Azores Continental Europe, United Kingdom. Ireland - Mediterranean U.S. West Coast- Caribbean Mediterranean - Hawaii U.S. East Coast - Caribbean U.S. Gulf Coast - Azores U.S. East Coast - Central America/Mexico Africa Interport Hawaii Interport U.S. Gulf Coast- Caribbean U.S. Gulf Coast-Central America/Mexico Alaska - Hawaii U.S. Great Lakes - Far East U.S. Great Lakes - Mediterranean U.S. West Coast- Middle East, South Asia, Indian Ocean Continental Europe, United Kingdom, Ireland Interport Far East-Continental Europe, United Kingdom, Ireland Far East-Mediterranean Far East-Middle East, South Asia, Indian Ocean U.S. East Coast - Black Sea U.S. West Coast- South America U.S. West Coast - Oceania U.S. East Coast- South America U.S. Gulf Coast- South America Mediterranean - Middle East, South Asia, Indian Ocean Far East- South America U.S. Gulf Coast- Black U.S. East Coast - Africa Far East - Oceania Continental Europe, United Kingdom, Ireland - Iceland Iceland - Mediterranean Continental Europe - Azores

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Route Description 65 Central America/Mexico - Continental Europe, United Kingdom, Ireland 66 Central America/Mexico - Mediterranean 67 U.S. West Coast-Africa 68 Central America/Mexico - South America 69 Central America/Mexico - Oceania 70 Azores - Mediterranean 71 Continental Europe, United Kingdom, Ireland - Africa 72 Continental Europe, United Kingdom, Ireland - Oceania 73 U.S. Gulf Coast-Africa 74 Mediterranean - Africa 75 Africa - Middle East, South Asia, Indian Ocean 76 Central America/Mexico Interport 77 U.S. East Coast - Oceania 78 U.S. Gulf Coast - Oceania 79 Hawaii - Oceania 80 Oceania - Middle East, South Asia Indian Ocean 81 Oceania Interport 82 Alaska - Far East 83 Alaska - Oceania 84 Caribbean - Central America, Mexico 85 Hawaii - Middle East, South Asia, Indian Ocean 86 Mediterranean - Scandinavia, Baltic Sea 88 Continental Europe, United Kingdom, Ireland - Caribbean 89 Mediterranean - Oceania 90 Far East-Africa 91 Alaska - Middle East, South Asia, Indian Ocean 92 Caribbean - Middle East, South Asia, Indian Ocean 93 Far East- Central America/Mexico 94 Mediterranean - Black Sea 95 Black Sea - Middle East, South Asia, Indian Ocean 96 Black Sea Interport 97 Continental Europe, United Kingdom. Ireland - Black Sea 98 Scandinavia, Baltic Sea Interport 99 Caribbean - Africa CA Caspian Sea Interport

4. STATUTORY AUTHORITY PERMITTING OTHER THAN FULL AND OPEN

COMPETITION

Authority for this acquisition is 10 U.S.C. § 3204(a)(3)(A), and FAR 6.302-3, Industrial Mobilization;

Engineering, Developmental, or Research Capability; or Expert Services (limiting competition to asset owning or controlling companies).

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5. DEMONSTRATION THAT THE PROPOSED CONTRACTOR'S UNIQUE

QUALIFICATIONS OR THE NATURE OF THE ACQUISITION REQUIRES USE OF THE

AUTHORITY CITED.

(a) This acquisition is for the purpose of acquiring international and domestic sea-based transportation and distribution services using ocean common carriers offering regularly scheduled commercial liner service for requirements that may arise in any part of the world.

(b) FAR 6.302-3(a)(2)(i) permits the use of other than full and open competition in situations where it is necessary to award to a particular source or sources in order to maintain providers of services in cases of national emergency or to achieve industrial mobilization, including, but not limited to, instances where it is necessary to keep vital suppliers in business, make them available in the event of a national emergency, prevent the loss of a supplier's ability, and/or maintain properly balanced sources of supply for meetings the requirements of acquisition programs in the interest of industrial mobilization.

( c) In the commercial sector, non-asset owning or controlling companies ( e.g., brokers, third-party logistics (3PL) providers) are often utilized to arrange commercial shipping. Non-asset owning or controlling companies do not have control of ocean vessels, and this limits their ability to implement route changes, diversions, or vessel positioning. This contract provides priority to Voluntary Intermodal Sealift Agreement (VISA) carriers. VISA program is a partnership between the U.S. Government and the maritime industry to provide the Department of Defense (DoD) with assured access to state-of-the-art commercial sealift and intermodal equipment when DoD deploys military forces during a national emergency or wartime operations. VISA is authorized under the Defense Production Act of 1950 as amended (50 U.S.C. § 4558) and Maritime Security Act of2003 and was approved as a DoD commercial sealift readiness program on January 30, 1997. It is operationally essential that USTRANSCOM have a direct contractual relationship with the vessel owning or controlling companies in order to execute commercial ocean shipments of DOD cargo under the Defense Transportation System, and to maintain the industrial base of vessel-owning ocean carrier services in the interest of national defense. USTRANSCOM must be able to interact directly with the vessel owning or controlling companies to conduct joint planning efficiently and discuss possible route changes, vessel positioning, and U.S.-flag ocean carrier capacity throughout the life of the contract to respond to USTRANSCOM operational requirements. The inability of USTRANSCOM to mobilize an asset without a direct contractual relationship with the asset owner (i.e., subcontractors) presents too great a risk to readiness. Therefore, it is operationally necessary to limit competition to asset owning or controlling companies.

6. DESCRIPTION OF EFFORTS MADE TO ENSURE THAT OFFERS ARE SOLICITED

FROM AS MANY POTENTIAL SOURCES AS IS PRACTICAL.

The USC-10 requirement will be synopsized in accordance with FAR 5.203(a). TCAQ-I will solicit all existing USC contract holders plus any other sources responding to the System for Award Management (SAM) notice. Additionally, TCAQ-I will send an email to all 23 current USC-9 contract holders with a link to the posted SAM synopsis.

7. DETERMINATION BY THE CONTRACTING OFFICER THAT THE ANTICIPATED

COST TO THE GOVERNMENT WILL BE FAIR AND REASONABLE.

The anticipated price to the Government for the initial establishment of USC-10 multiple awards will be determined fair and reasonable based on competition and/or a comparison with current year prices, Page 5 of7

Federal Maritime Commission service contracts, and/or commercial tariffs. Option period pricing will be requested and determined fair and reasonable prior to exercising options.

8. DESCRIPTION OF THE MARKET RESEARCH CONDUCTED AND THE RESULTS OR A

STATEMENT OF THE REASONS MARKET RESEARCH WAS NOT CONDUCTED.

Market research was conducted through two Requests for Information (RFI) to the USC-9 carriers. The RFI responses resulted in changes to the requirement and the changes will be incorporated into the solicitation. Also, research was conducted through the U.S . Department of Transportation Maritime Administration (MARAD) and Federal Maritime Commission to ensure all possible sources for these services were considered. MARAD has a website listing all U.S.-flag VISA participants. Furthermore, an industry day was held in November 2022 to assist the Government with defining the proposed changes for the USC- IO requirement.

9. ANY OTHER FACTS SUPPORTING THE USE OF OTHER THAN FULL AND OPEN

COMPETITION.

Not Applicable.

10. A LISTING OF SOURCES, IF ANY, THAT EXPRESSED AN INTEREST IN THE

ACQUISITION.

All current USC-9 ocean common carriers have expressed a written interest in this acquisition.

11. A STATEMENT OF ACTIONS, IF ANY, THE AGENCY MAY TAKE TO REMOVE OR

OVERCOME ANY BARRIERS TO COMPETITION BEFORE MAKING ANY SUBSEQUENT

ACQUISITION FOR THE SUPPLIES OR SERVICES REQUIRED.

If a non-contract holding carrier offers U.S.-flag service on a route that none of the USC-9 carriers offer service, USTRANSCOM may negotiate a contract with the new carrier to comply with the Cargo Preference Act.

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SOURCE SELECTIO INFORMATIO - SEE FAR 2.101 AND 3.104

I ce1tify that the data supporting the recommended use of other than full and open competition is accurate and complete to the best of my knowledge and belief.

WILLIAM R. HENDERSON

Contracting Officer Chief, Sealift Procurement Branch

13. TECHNICAL/REQUIREMENTS PERSONNEL CERTIFICATION.

I certify that the suppo1ting data tmder my cognizance that are included in the justification are accurate and complete to the best of my knowledge and belief.

Functtona Seiv1ces Manager

SDDC-G3

14. WRITTEN DETERMINATIO OF THE APPROVING OFFICIAL IDENTIFYING THE

CIRCUMSTANCE THAT APPLIES TO THE ACTION.

Based on the above cited justification, I hereby detennine the circumstance in FAR 6.302-3 applies to this justification for other than full and open competition.

KENNETH M. BRENNAN

SES, DAF

Senior Procurement Executive

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