26-JA-FECON-0015 N4008423F4690 AWS040_Redacted.pdf

January 2025

J&A No. 26-JA-FECON-0015

Justification for an Exception to Fair Opportunity

AGENCY AND CONTRACTING ACTIVITY: This is a Justification for an Exception to Fair Opportunity. The requiring activity is the Commander Fleet Activities Okinawa (CFAO); the contracting activity is the Naval Facilities Engineering Systems Command Far East (NAVFAC FE), Resident Officer in Charge of Construction (ROICC) Okinawa, Japan.

NATURE AND/OR DESCRIPTION OF THE ACTION BEING APPROVED: This is a limited source action to be awarded as an out of scope modification to an existing order to American Engineering Corporation (AEC) under contract number N4008421D0070, task order N4008423F4690, AWS040 Replace Generator at Awase Communication Site, Okinawa. The placement of a firm, fixed price is anticipated.

DESCRIPTION OF REQUIRED SUPPLIES/SERVICES: The proposed acquisition is to incorporate new cybersecurity monitoring requirements to comply with NAVFAC NOTE 5230 dated 28 May 2026, in support of Defensive Cyber Operations (DCO) Implementation Guidance. This modification intends to revise the backup power generation system’s automatic transfer switch (ATS) control system by upgrading the cabling infrastructure and network switches, reprogramming and testing, and providing a temporary generator. The estimated cost for this out-of-scope work is and Fiscal Year 2026 Operations & Maintenance, Navy (O&MN) funds would be used. As a result, the task order price will increase from $ to $ .

IDENTIFICATION OF THE EXCEPTION TO FAIR OPPORTUNITY: The statutory authority which permits exception to fair opportunity to be considered for each order over the micro-purchase threshold issued under a multiple award contract is 10 U.S.C. 3406(c), as implemented by FAR 16.507-6(b):

(1) The agency need for the supplies or services is so urgent that providing a fair opportunity would result in unacceptable delays.

(2) Only one awardee is capable of providing the supplies or services required at the level of quality required because the supplies or services are unique or highly specialized.

(3) The order must be issued on a sole-source basis in the interest of economy and efficiency because it is a logical follow-on to an order already issued under the contract, provided that all awardees were given a fair opportunity to be considered for the original order.

(4) It is necessary to place the order to satisfy a minimum guarantee.

(5) For orders exceeding the simplified acquisition threshold, a statute expressly authorizes or requires that purchase be made from a specified source.

(6) The order satisfies one of the exceptions permitting the use of other than full and open competition listed in 6.103 (10 U.S.C. 3406(c)(5)).

RATIONALE/EXPLANATION TO SUPPORT CITED AUTHORITY: This task order modification must be awarded to the incumbent contractor, AEC, in the interest of economy and efficiency as a logical follow-on to an existing task order. Executive Order 14144 was signed on 16 January 2025 and execution plan through DCO Implementation Guidance was published on 28 May 2026; hence, the requirements for DCO compliance did not exist at time of the original task order award. This requirement is considered out of scope because can be accomplished as a stand-alone requirement.

However, based on the following reasons, it was determined that sole sourcing this to the incumbent is in the best interest of the Government.

Recency of the previous competitive order and the number of times this exception has been used:

All Okinawa DB/DBB MACC holders were given a fair opportunity to compete for the original task order, which was awarded on 15 August 2023 and is currently at 42% completion. The incumbent is currently fully mobilized at the same location as this proposed out-of-scope work. This is the first time this exception to fair opportunity has been used for this requirement.

Why the specific requirement continues:

The requirement continues because new monitoring requirements are being implemented by NAVFAC NOTE 5230, designating DCO as a Tier 1 strategic outcome to ensure Fleet operational readiness. Under this policy, connecting the newly installed generator control system (referred to as a Mission Critical – Facility-Related Control System (MC-FRCS)) to the Control System Platform Enclave (CSPE) is mandatory to enable continuous monitoring, incident response, and cybersecurity threat mitigation. Without implementing these DCO monitoring requirements, the facility's control systems will remain vulnerable to cyber threats, directly compromising mission-critical operations.

Why it would be of benefit to the Government for the specified contractor to continue this work:

Awarding this requirement to the incumbent contractor, AEC, provides significant programmatic, fiscal, and technical benefits to the Government:

Executing this requirement concurrently with the active construction project complies with NAVFAC NOTE 5230 which explicitly directs that new CSPE connections must be prioritized in facilities construction, modernization, and renovation projects.

Since AEC is already mobilized on-site and actively replacing the generators and ATS control system, they possess the immediate capability to procure the required materials without disrupting the ongoing construction schedule. Furthermore, since the necessary cabling and switch upgrades must be physically integrated into the ongoing construction, AEC can perform these upgrades immediately and seamlessly within the active workflow.

AEC is solely responsible for the overall system integration, testing, and warranty of the new generators. Introducing a second contractor to modify the switch configurations and wiring would fragment technical responsibility, void AEC’s system warranties, and expose the Government to future integration and financial risks. Furthermore, awarding a separate competitive procurement for this out-of-scope work would only result in redundant administrative costs, destructive re-work, and delay in implementing DCO requirements.

Therefore, keeping this requirement with AEC is the only efficient and cost-effective approach to ensure seamless execution and protect the Government's financial and operational interests.

(d) Why the relationship between the initial order and the follow-on is logical:

The relationship between the initial task order and this follow-on action is highly logical because the new cybersecurity monitoring requirements directly rely on, and expand upon, the physical infrastructure currently being constructed. The additional cables must be pulled through the exact same conduits and routed between the same rooms established under the incumbent project.

Furthermore, the new network switches to be installed are direct, upgraded replacements for the models originally specified to support the facility's control systems.

(e) Award to any other source would likely result in substantial duplication of cost to the Government that is not expected to be recovered through competition:

Awarding this requirement to another source would result in substantial duplication of costs that will not be recovered through competition. A new contractor would require redundant mobilization costs and administrative overhead, security vetting of personnel, site familiarization, and an extensive engineering review of AEC’s ongoing generator installation before they could safely work on the cabling and switch upgrades. Furthermore, the potential cost of voided warranties and future integration failures between two different contractors' work far outweigh any marginal price reduction that might be achieved through separate solicitation.

6. FAIR AND REASONABLE COST DETERMINATION: The Contracting Officer has determined that the anticipated cost to the Government of the supplies/services covered by this J&A will be fair and reasonable prior to the execution of the task order modification. This determination will be based on a technical evaluation of the contractor’s proposal, comparison with the Independent Government Cost Estimate (IGCE), and comparison with historical pricing for similar procurements as prescribed in FAR 15.404-1.

7. ANY OTHER FACT SUPPORTING THE JUSTIFICATION: None.

ACTIONS TO INCREASE COMPETITION: In this specific case, the new DCO requirements mandated by NAVFACNOTE 5230 was issued on 28 May 2026 – nearly three years after the original task order was competitively awarded on 15 August 2023. Consequently, these technical requirements could not have been reasonably anticipated or included in the original solicitation.

For future requirements of this nature, the requiring activity will conduct thorough facility and regulatory policy audits during the planning and pre-solicitation phases of future MACC task orders to ensure all up-to-date control system and security specifications are captured prior to award, thereby maximizing fair opportunity.

8. TECHNICAL/REQUIREMENTS/FUNCTIONAL LEAD CERTIFICATION

I declare that the facts and representations under my cognizance which are included in this justification is complete and accurate to the best of my knowledge and belief.

Signature: Phone: Date _____________

Name/Title: , NAVFAC Far East ROICC Okinawa

9. LEGAL SUFFICIENCY REVIEW

I have reviewed and determined this Justification is legally sufficient.

Name/Title: , NAVFAC Far East

10. CERTIFICATION AND APPROVAL

Upon the basis of the above justification, I certify that this justification is accurate and complete to best of my knowledge and belief and hereby approve the Exception to Fair Opportunity for the proposed procurement(s) described herein using pursuant to the 10 U.S.C. 3406(c), as implemented by FAR 16.507-6(b)(3):

ECHELON IV CHIEF OF CONTRACTING OFFICE APPROVAL

Name/Title: , NAVFAC Far East

11 SEP 2026

15-Sep-2026

15-Sep-2026