24-450 Exception to Fair Opportunity JA - form_20240624.all sigs.pdf

DMEA #24-21

6/11/2018

Justification for Exception to Fair Opportunity Process for

Advanced Technology Support Program IV (ATSP4) Indefinite Delivery / Indefinite Quantity (ID/IQ) Task Order Contract

1. Agency and Contracting Activity:

Defense Microelectronics Activity (DMEA) Contracting Division/MECB Attn: Amber Molina, Contracting Officer amber.a.molina.civ@mail.mil 4234 54th Street McClellan, CA 95652

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

This is a new task order award being made to Northrop Grumman Corporation Aeronautics Systems (NGCAS) under the basic IDIQ contract, HQ0727-16-D-0004; CET 24-450 dated June 14th, 2024, for BQM34 Target Drone.

3. Description of the Supplies/Services Required To Meet the Agency’s Needs (including the total estimated value, including options, if any):

The BQM-34S was originally developed in the 1950’s and the last production deliveries were in 1998. The Navy and Air Force accepted ~8,000 Targets over the life of the production contracts.

This has been a very successful platform and continues to have strong value, with a high capacity payload space, much larger that other more recently developed platforms, that makes it desirable.

The current inventory is less than one hundred and because there is no replaceable Target developed and produced with the same capabilities the Navy will be re-starting the production line for the BQM- 34S. The production line restart will require work to eliminate component obsolescence issues in the BQM-34S avionics systems. The estimated value is approximately $13M.

4. Identification of the Exception to Fair Opportunity (Authority Cited):

FAR 16.505(b)(1)(i) requires the Contracting Officer to provide each awardee under a multiple award contract, a fair opportunity to be considered for each order exceeding $3,500 unless one of the following statutory exceptions apply. The specific exception that precludes the fair opportunity process for this acquisition is:

FAR 16.505(b)(2)(i)(B), Only one awardee is capable of providing the supplies or services required at the level of quality required because the supplies or services ordered are unique or highly specialized.

5. Identification of requirement for the procurement of items peculiar to one manufacturer: (if not applicable delete)

FAR 16.505(b)(2)(i)(B), Only one awardee is capable of providing the supplies or services required at the level of quality required because the supplies or services ordered are unique or highly specialized.

mailto:amber.a.molina.civ@mail.mil http://farsite.hill.af.mil/reghtml/regs/far2afmcfars/fardfars/far/16.htm#P399_69627

Rationale for authority cited:

The Technical Data Package (TDP) for the BQM-34S Aerial Target is owned by Northrup Grumman Corporation (NGC). On 23 April 2023, NAVAIR requested to buy the rights from NGC for the complete BQM-34S Aerial Target TDP. NGC responded on 03 May 2023 to NAVAIR’s request by stating “it is not in the best interest to sell either title or unlimited rights to our BQM-34S Technical Data Package.” Because NGC is the sole designer, developer, integrator, and manufacturer of the BQM-34S Subsonic Aerial Target they are the only source with the requisite knowledge, experience, and technical data that can meet the Government's requirements for updating the Avionics system within the BQM-34S Subsonic Aerial Target system.

6. Additional Facts Supporting this Justification:

The Government has looked into multiple alternatives to a continued sole-source arrangement with Northrup Grumman. First, as previously mentioned in section 5, we attempted to purchase the rights, including the TDP, to be able to allow others to bid on manufacturing units derived from the original design. As mentioned, Northrup Grumman refused to consider selling those rights. Secondly, the government did preliminary investigations into doing a re-design from scratch. Initial analysis make it clear that this would both be significantly more expensive and also would result in an unacceptably late delivery schedule. As mentioned in section 3, current inventories are dwindling and the government requires continuous use of this platform well into the future or risk adversely affecting fleet operations. As such, the most cost effective and time effective solution is to sole-source this platform from Northrup Grumman, including addressing obsolescence issues.

7. Actions to Remove or Overcome Any Barriers that Led to this Exception to Fair Opportunity

For the reasons set forth in paragraph 5&6, NAVAIR currently has no immediately available options for competing the supplies and services in support of the BQM-34S covered by this document. The business case for the Government to develop a new technical data package for the purposes of competing it is unacceptable because it can not be met within the needed delivery timeframe and would be more expensive. Once an on-going supply of the BQM-34S platform is available, it may be possible in the future to re-consider whether developing a new platform that can be opened to Fair Opportunity, however, even in that case, the new platform would still need to meet the legacy feature set and requirements, in particular, the payload capacity

8. Redaction

IAW FAR 16.505, the justification must be posted within 14 days after contract award. Project Engineers shall check appropriate box based on coordination with the customer for screening IAW 16.505(b)(2)(D)(4):

(Select one)

__X__ No redaction is necessary. This J&A will be posted in its entirety.

____ This J&A contains information that cannot be publicly posted (i.e. proprietary contractor data).

A redacted copy will be sent to PCO for posting after customer input.

____ Disclosure of information contained in this J&A would compromise the national security (e.g., would result in disclosure of classified information) or create other security risks. As a result, this J&A will not be posted. Rationale has been provided to the PCO to document the contract file.

9. Technical / Requirements Certification (required on all J&As)

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

NAME: __Ken Crawford_________________________ TITLE: Project Engineer

SIGNATURE: ____________________________ DATE: ______________________

10. Technical / Requirements Supervisor Certification: (required on all J&As)

NAME: __John Cotterill___________________________ TITLE: Chief, Systems Branch

11. Contracting Officer Determination (required on all J&As)

I certify that this J&A is accurate and complete to the best of my knowledge and belief.

I hereby determine that the anticipated cost or price to the Government for this contract action will be fair and reasonable. Actions to ensure reasonableness of the price will be accomplished using procedures and criteria contained in FAR 15.4. Cost and pricing data will be requested. Detailed documentation and justification of price reasonableness will be set forth in the Price Negotiation Memorandum.

NAME: __Amber Molina________________________ TITLE: Contracting Officer/MECB

12. Chief, ATSP Branch (required on all J&As)

NAME: __ Colten Murray___________________ TITLE: Chief, ATSP Contracting Branch

SIGNATURE: ______________________ DATE: ______________________

13. Sr. Procurement Analyst / MECA (required on all J&As)

NAME: ___Anna Madden______ __________ TITLE: Chief, Acquisition Policy & Analysis Branch_

SIGNATURE: ______________________ DATE: ______________________

14. Office of Counsel (required ≥ $500K; See MEC SOP 22)

NAME: ___ William Davis ________________ TITLE: __Legal Counsel_______

SIGNATURE: ______________________ DATE: ______________________

15. Chief of Contracting/Competition Advocate (required ≥ $750k-$15M)

NAME: ___Adrienne Strickland ________________ TITLE: Chief, Contracting Division

SIGNATURE: ______________________ DATE: ______________________

16. Head of Contracting Activity (required ≥ $15M-$100M) (Designee IAW Delegation of Contracting Authority Memo dated Sep 16 2013) (As req’d by FAR and/or MEC SOP 22)

NAME: _ (Not required)___________________ TITLE: Director, Defense Microelectronics Activity

SIGNATURE: ______________________ DATE: ______________________

Date_7: 6/24/24