36C25020C0134_1.docx

Contract Opportunity Justification and Approval Notice

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* = Required Field Contract Opportunity Justification and Approval Notice J041 Siemens Energy Management System (EMS) 48105 36C25020Q0631 36C25020C0134 S N 238210 Department of Veterans Affairs Ann Arbor Healthcare System Network Contracting Office 10 2215 Fuller Road Ann Arbor MI 48105 Jennifer Johnson jennifer.johnson18@va.gov Jennifer.Johnson18@va.gov 734-222-4283

FAR13

36C25020C0134 $356,592.00 05-28-2020

SIEMENS INDUSTRY INC.

1000 DEERFIELD PKWY

BUFFALO GROVE

IL

60089

DEPARTMENT OF VETERANS AFFAIRS

Justification and Approval (J&A) Other Than Full and Open Competition (>SAT)

Acquisition Plan Action ID: 36C250-20-AP-1114

1. Contracting Activity:

Network Contracting Office 10 24 Frank Lloyd Wright Drive Lobby M, Suite 2200 Ann Arbor MI 48105

Organizational Activity:

John D. Dingell Veterans Affairs Medical Center Engineering (138) 4646 John R. Street Detroit MI 48201

Purchase Request Number: 553-20-3-3102-0034.

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

This will be a new contract action. Siemens is currently undergoing an audit for GSA contract GS-07F-217CA, and as a result, the 5 year option will not be exercised unless and until the audit is complete. Therefore, the Government intends to solicit and award this requirement as an open market procurement. This is anticipated to be an Indefinite Delivery Indefinite Quantity (IDIQ) type contract which allows for Firm Fixed Price task orders.

FAR 13.5 Simplified Procedures for Certain Commercial Items: This procurement is for Siemens EMS services in accordance with FAR 13.5 Simplified Procedures for Certain Commercial Items and specifically FAR 13.501 Special Documentation Requirements, where acquisitions conducted under Simplified Acquisition Procedures are exempt from the requirements of FAR Part 6, but still require a justification using the format of FAR 6.303-2.

3. Description of Supplies/Services Required to Meet the Agency’s Needs:

The contractor shall supply Energy Management System (EMS) services to the Siemens Apogee main server, as well as five (5) client computers in the medical center. The contractor shall also provide the following services:

· Emergency onsite response: Monday through Sunday, 24 Hours per day

· Emergency Online/Phone Response: Monday through Sunday, 24 Hours per day

· NFS Mechanical Support

· Online Data Backup & Protection Support

· Automation Health Reporting

· Continuous Commissioning

· Repair & Replacement Services

· Task-Based Services

· Automation Health Issue Resolution

· Control Loop Tuning

· Network Maintenance

· Preventive Maintenance

· Thermal Imaging Report

· Datamate Advanced Software Renewal

· Software support and upgrades

· Calibration Services

· Pneumatic controls Inspection

· Pneumatic Preventive Maintenance

· Analysis and Fault Detection Diagnostic Services

· KPI reporting The primary Building Automation System on site is Siemens Apogee Insight and requires a Siemens Industry contractor with specific knowledge to perform the requirements of the contract. The Government estimates the total value (inclusive of an optional period of up to 6 months in accordance with FAR 52.217-8) at $2,054,163. The Contracting Officer intends to establish a $2.2 million ceiling for the IDIQ, with a guaranteed minimum of $100,000.00. The resulting contract will be established with a 5 year period of performance inclusive of five (5) one year ordering periods, with an anticipated award date of May 22, 2020.

4. Statutory Authority Permitting Other than Full and Open Competition:

The authority for applying the Simplified Procedures for Commercial Items of FAR 13.5 is 41 U.S.C. 1901 and is implemented by for restricting competition on this procurement via FAR 13.106-1(b)(2).

5. Demonstration that the Contractor’s Unique Qualifications or Nature of the Acquisition Requires the Use of the Authority Cited Above (applicability of authority):

The primary EMS on site is Siemens Apogee Insight. The proper maintenance of the system, including end devices, calibration, micro-servers, programming and database maintenance requires a high level of Siemens Industry Inc. specific knowledge to perform correctly. The Siemens Apogee automation network is a proprietary statem that requires only the manufacturer to provide all software that runs each individual cabinet, Floor Level Network device as well as all programming within each device. All replacement items (control valves, actuators, sensors, Programmable Logic Controllers, etc.) require factory device replacement.

Siemens EMS equipment is controlled by proprietary software and the justification is based on the existence of limited rights in data, patent rights and copyrights. Siemens is the manufacturer of the entire network which requires their proprietary software and upgrades which can only be supplied and installed by Siemens. The system is run by programming which is also proprietary to the manufacturer. All components of the system are Siemens and require Siemens trained service technicians to make adjustments and repairs to many items on the network that require computer interface. All sensors, values, actuators, and processors of the system are manufactured by Siemens and require Siemens trained personnel to make adjustments and repairs. Many of the interconnected systems are still under manufacturer warranty and any other contractor allowed to work on these sytems will void the warranty.

The risk associated with considering a company other than the OEM in performing this work and the potential consequences of obtaining another company to perform this work are unacceptable performance risks and duplication of cost which is not in the best interest of the Government.

6. Description of Efforts Made to ensure that offers are solicited from as many potential sources as deemed practicable:

No efforts were made to solicit other sources. Software and licensing for this equipment is proprietary to the OEM, Siemens. No other contractor can provide the required services for the existing equipment and infrastructure.

7. Determination by the CO that the Anticipated Cost to the Government will be Fair and Reasonable:

The Contracting Officer anticipates the cost will be fair and reasonable in accordance with FAR 13.106-3(a)(2)(i) market research, (ii) comparison to historical pricing and (vi) comparison to an independent government estimate. This requirement has been awarded to Siemens for at least the past 5 years with contract pricing identified in past FSS orders:

· GS-07F-217CA / VA251-15-F-2839 (extended by 6 months into FY17)

· GS-07F-217CA / VA250-17-F-2839

· GS-07F-217CA / 36C25018F1934

· GS-07F-217CA / 36C25019F0907

8. Description of the Market Research Conducted and the Results, or a Statement of the Reasons Market Research Was Not Conducted:

The Contract Specialist queried VA’s VIP database to identify verified capable SD/VOSBs. The query located 1,292 results using NAICS 238210. Siemens hardware and software are currently installed at the Detroit VAMC. Software and licensing for this equipment are proprietary to the Original Equipment Manufacturer, Siemens. No other contractor can provide the required services for the existing equipment and infrastructure. The VA Rule of Two cannot be met.

9. Any Other Facts Supporting the Use of Other than Full and Open Competition:

None.

10. Listing of Sources that Expressed, in Writing, an Interest in the Acquisition:

Siemens Industry Inc. – DUNS 010944650 1000 Deerfield Parkway Buffalo Grove IL 60089-4547

11. 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:

The existing Siemens control system infrastructure is forward and backward compatible by design. This allows for expansion and modification to the infrastructure without the need to wholesale replace the infrastructure. The Research and Development and intellectual property involved in the development of programming algorithms is cost prohibitive to the Department of Veterans Affairs. Therefore, it is not in the best interest of the Government to replace the Siemens infrastructure.

12. Requirements Certification: I certify that the requirement outlined in this justification is a Bona Fide Need of the Department of Veterans Affairs and that the supporting data under my cognizance, which are included in the justification, are accurate and complete to the best of my knowledge and belief.

Chief, Facility Management Service John D. Dingell VAMC Detroit

13.

Approvals in accordance with the VHAPM Part 806.3 OFOC SOP:

a. Contracting Officer or Designee’s Certification (required): I certify that the foregoing justification is accurate and complete to the best of my knowledge and belief.

Contracting Officer Network Contracting Office 10

b. One Level Above the Contracting Officer (Required over SAT but not exceeding $700K): I certify the justification meets requirements for other than full and open competition.

Branch Chief, Services Team #4

Division Chief, Healthcare and General Services

Director of Contracting

c. VHA RPOC HCA Review and Approval: I have reviewed the foregoing justification and find it to be complete and accurate to the best of my knowledge and belief and approve for other than full and open competition.

Executive Director Regional Procurement Office Central (VHA) OFOC SOP Revision 08 Page 6 of 6 Original Date: 03/22/11 Revision 08 Date: 04/18/2018