4.7 Simulator Redacted Justification Approval Template July 2021.pdf

J&A 21106

DEPARTMENT OF THE NAVY

NAVSUP FLEET LOGISTICS CENTER NORFOLK

1968 GILBERT STREET SUITE 600

NORFOLK VA 23511-3392

IN REPLY REFER TO

230.1

18 August 2021

JUSTIFICATION AND APPROVAL

FOR USE OF OTHER THAN FULL AND OPEN COMPETITION

1. Identification of Agency and Contracting Activity.

Requiring Activity: Commander Naval Expeditionary Combat Command (NECCLANT)

JEB Little Creek, Bldg 3504

Code N02F

1575 Gator Blvd

Virginia Beach, VA 23459-3024

Contracting Activity: Commanding Officer

NAVSUP Fleet Logistics Center Norfolk

1968 Gilbert Street

Norfolk, VA 23511-3392

2. Description of the Action Being Approved.

This action is for the award of a sole source firm-fixed priced Indefinite Delivery/Indefinite Quantity

(IDIQ) contract to Conflict Kinetics Corporation, 22977 Eaglewood CT STE 160, Sterling VA 20166-

9448 utilizing the authority of Other Than Full and Open Competition as permitted by 10 U.S.C.

2304(c)(1), and implemented by FAR 6.302-1, since there is only one responsible source and no other supplies or services will satisfy agency requirements. This requirement is a follow-on to a non-competitive requirement.

3. Description of Supplies/Services.

The proposed acquisition is for the procurement of TORA Small Arms Simulator support services to include: weekly on-site support for all simulator locations to provide remote 24-hour software support to include upgrades and system troubleshooting; provide software modifications to meet evolving mission requirements. These modifications could include additional targets, land and sea based models, terrain, weather and low-light changes to marksmanship targets; provide monitoring and maintenance for CK

Training Systems worldwide to ensure Information Assurance compliance, and resources allocation.

Provide technical review and applicability of DISA Security Technical Implementation Guides (STIGs) and run information assurance (IA) validation on servers, workstations, and network equipment utilizing

Security Content Automation Protocol (SCAP tool) and/or Assured Compliance Assessment Solution

(ACAS)/NESSUS. Operate Assured Compliance Assessment Solution scanner and produce required

Source Selection Information – See FAR 2.101 and 3.104

NESSUS scan reports for accreditation. Provide configuration of all hardware in the accreditation boundary, including servers, switches, VPN, and router; provide DoD security compliant/approved design solutions and modifications which improve operation of and/or security posture of the CK Training systems; on a monthly basis, review guidance of documentation on the ATO accreditation process regularly and ensure compliancy. The applicable regulations are provided by DOD Instruction 8510.01

(Risk Management Framework). All updates and requirements shall be incorporated into their respective design documentation and equipment configuration changes; as well as serve as the Cyber Security Agent:

Ensure confidentiality, integrity, and availability of systems and data through planning, analysis, development, implementation, maintenance and enhancement of information systems, policies, procedures and tools. This includes: ensuring that the simulators are running according to prescribed directives and procedures utilizing 2 network security applications such as Assured Compliance

Assessment Solution (ACAS)/Nessus, and Corporate Antivirus Software, restore data in the event of system failure; conduct Information Assurance Vulnerability Assessments (IAVA) and antivirus scans;

evaluate patches for validity and compatibility for subject system; and install appropriate patches and updates; and on a daily basis perform necessary actions to mitigate vulnerabilities identified during monthly ACAS scans. Report completion of all patching and relevant issues via email to the NECC

Program Manager and Information Assurance Manager (IAM). Regularly ensure continuous technical availability to customers. Work with deployed organizations to resolve issues related to delivery of services.

The Ordering Period will be established as 01 April 2022 thru 31 March 2027

The Independent Government Estimate for a five-year Ordering Period is in the amount of XXXX. The

Independent Government Estimate was developed by NECCLANT based on historical pricing, an increase in training, and opening a training site in Djibouti and re-opening a training site in Gulf Port. This estimate does not include procuring new simulators as simulators are already available at Gulf Port and Djibouti and only require installation and upgrade with Conflict Kinetics software.

Funding for the individual orders is anticipated to use Operations and Maintenance Navy (O&M,N) appropriations within the current fiscal year of the order requirement.

4. Statutory Authority Permitting Other Than Full and Open Competition.

The statutory authority permitting Other Than Full and Open Competition is 10 U.S.C. 2304(c)(1), as implemented by FAR 6.302-1(a)(1) and FAR 6.302-1(a)(2)(iii)(A), as identified in paragraph 5, since there is only one responsible source and no other supplies or services will satisfy agency requirements.

5. Rationale Justifying Use of Cited Statutory Authority.

The authority FAR 6.302-1(a)(1) cited in paragraph 4 above is applicable because the Government’s need can only be satisfied by the current contractor, Conflict Kinetics Corporation. NECCLANT and

NECCPAC both own TORA Weapons Simulators manufactured by Conflict Kinetics Corporation.

NECC has owned the Conflict Kinetics TORA Weapons Simulators since 2015 and Conflict Kinetics

Corporation has proprietary rights to their equipment, eliminating support from other Vendors.

The authority FAR 6.302-1(a)(2)(iii)(A) cited in paragraph 4 above is applicable because services may be deemed to be available only from the original source in the case of follow-on contracts for the continued provision of highly specialized equipment, including major components thereof, when it is likely that award to any other source would result in substantial duplication of cost to the Government that is not expected to be recovered through competition. If another Vendor were to provide new equipment with hardware/software modifications and updates; along with training support and warranty, this would substantially duplicate the cost, as there is already an infrastructure in place. The training software owned by Conflict Kinetics Corporation is content updated to teach military personnel how to react in live fire situations in various scenarios, so they are prepared when they deploy and encounter same/similar situations. The training not only includes live fire simulation training, but it also includes various combat skills for self-defense, small arms qualifications (including CAT III and IV small arms, Crew Served Weapons training, and shoot/no shoot interactive scenarios). This training also shows a military member’s weaknesses prior to deployment; allowing those weaknesses to be resolved through additional training.

The Government first considered whether it was possible to replace the software on the systems.

Currently, as discussed, Conflict Kinetics Corporation has proprietary rights to their software licenses, eliminating support from other Vendors. In order to have another vendor work on the equipment, the software would have to be replaced. The Government found that replacement of the equipment’s software in this case would not be possible.

Here, each simulator system has a unique operating system that includes connection to the peripherals

(cameras, projectors, and in some cases weapons). The software system is designed around video cards and optics to allow for accurate depiction and grading of responses. The servers used for each simulator require very specific configurations to support the operating system. One operating system cannot simply be removed and replaced with another. In market research, the Government found that were the requiring activity to pursue changing out the operating system, a vendor would quote the cost for the complete system. In the past, the requiring activity met with industry to determine whether it was possible to cross utilize the systems or have side-by-side servers that could switch between operating systems. However, industry’s response was that systems could not be mixed. Market research revealed that if the Government were to seek replacement of the operating system, the Government would have to essentially repurchase the entire simulator base.

Next, the Government considered just that—entire replacement of the simulators. Currently, all existing simulators are functional; however, procuring new simulators and providing training would create an undue delay causing a lapse in services and a waste of taxpayer funds. The Customer reviewed the costs to procure new simulators. The Government has currently invested the following into their simulator systems:

(6) PAN 220 crew served systems ($879,800 per system), with one additional coming online: totaling approx. $6,158,600

(12) TORA small Arms systems (various, between $355,100 and $1,134,200 per system): totaling approx. $5,559,150

In total, considering just the simulator systems themselves, the Government has currently invested approx. $11,750,100.

The Government considered replacing the simulators with new infrastructure. In addition to the costs detailed above to procure new systems, the Government would also still require the support, software licenses, etc., that are the subject of the instant requirement. Based on the Government estimates for this contract, those support costs would include:

-Annual Cyber-security monitoring: Approx. $230K/yr for a total of $1.15M

-On site FTE support at 12 sites (average FTE fully burdened $120K): $1.44M/yr

Added to the software licenses themselves, the total cost for the support of this effort would total around

$5.6M/yr; providing for escalation, up to $31.35M for the life of the contract. When added to the costs to procure new simulators, the Government estimated that replacement of the existing infrastructure with comparable systems (provided they even exist), could cost over $43M, or over 37% higher than the cost of this contract.

In addition to the approx. $11.75M already invested into the systems, the Government also considered the expected lifetime of the existing simulators. The oldest simulator currently in operation was procured in 2015, with the newest purchased in 2019. The estimated lifetime of the simulators is approximately

12 years. The Government can expect to utilize the existing simulators until at least 2027 (for the oldest), and up to 2031, before the newest systems reach the end of their usable lifetime. Since even the oldest system should remain useable for at least 6 more years, the Government finds that it would be both inefficient and duplicative to replace the infrastructure at this point in its lifecycle.

In addition, based on Market Research, if the Government was to utilize a new Vendor, not only would there be an increase in costs, but there would also be multiple, unacceptable delays.

First, the Government has already invested upwards of 3 years in achieving an ATO (authority to operate) for the current system, a DoD cybersecurity requirement for IT systems. An ATO is granted under the

“Risk Management Framework” (RMF), pursuant to DoDI 8510.01, which is the process by which the

DoD ensures the security of their information systems. The RMF process identifies how much risk each system introduces to the Global Information Grid, or GIG. That risk is identified by determining compliance with security controls (mandated by CNSSI 1253), by reviewing vulnerability scans, and by determining how well the system has been hardened implementing Security Technical Information

Guides (STIGs). When a system has been determined to be of minimal risk to the GIG, it is issued an

Authority To Operate (ATO).

Until an ATO is achieved (or showing progress towards an ATO), items such as IT Purchase Request cannot be approved and the requiring activity will lose funding for the simulator systems. The ATO process is a lengthy one—for each simulator, the requiring activity has had to submit 28 control polices, a software list that must be registered in DADMS, a hardware list registered in DITPR DON, engineering drawings outlining the entire system and have 5 checkpoint meetings with the Department of the Navy’s

Chief Information Officer (DON CIO) for approval. NECC’s current simulator systems are in

“checkpoint 5” of the process with multiple stakeholders currently overseeing it through this process, to include the Navy Authorizing Official (NAO) and the US Fleet Forces Command Cyber Security Team.

This process began in June 2018, and the Government finds that beginning this process again with a new system would be excessively burdensome, inefficient and duplicative in both costs and man-hours wasted. Other Navy simulators are tied into a DOD network so the scanning process and testing is much easier. However, in this case, the requiring activity has had to work with NAO on validating standalone simulators, a process which is not defined in the current RMF, which has increased the timeframe for approval, as repeated test results have required reconfiguring the system according to the Cyber Security guidelines which can change almost quarterly.

Second, there would be an approximate 2.5 year delay in having procurement funding approved. All new purchases of this type would require OPN funding which has to come through the POM process. The

POM process is a 2 ½ year lead for submission. There is no guarantee that the POM input would be approved. NECC cannot support a contract that calls for replacing our simulator systems unless we had

OPN funding in hand.

6. Description of Efforts Made to Solicit Offers from as Many Offerors as Practicable, including a

Description of Market Research, if applicable, and a List of Interested Sources, if any.

The Government has conducted extensive market research since 2012 for the Navy Category III/IV marksmanship training simulator requirement. Most recently, in June 2021, the NAVSUP FLC Norfolk

Contracting Department issued a Sources Sought Notice in accordance with DFARS PGI 206.302-1. One capability statement was received from the incumbent, Conflict Kinetics; no other capabilities statements were received.

The Contracting Officer also reviewed a previous Sources Sought issued from 06 March 2020 to 30 March

2020, which yielded three unacceptable capabilities states; however, the Sources Sought did reveal similar weapons simulators and related services are available from other commercial manufacturers, these systems and services are not compatible with the TORA Weapons Simulators nor can these manufacturers offer services on NECC’s existing simulators due to proprietary rights, and the software cannot simply be replaced as discussed in detail above. This indicates that no other Vendor holds this capability and a development contract for an entire new simulator system would be necessary to obtain this requirement under any other alternative. As stated above, going to another Vendor would result in a substantial duplication of costs and unacceptable delays related to procuring this training system. In addition to the discussion above, a review of the market shows Vendors capable of meeting the CAT III/IV requirement would require a research and development process. To utilize a company without the organic software capabilities would threaten the mission in the form of at least a 2.5-year delay and a duplication in costs in procuring new systems when the current systems are well within their usable lifetime, and should be until at least 2027, or even until 2031. The delay and costs were determined by NECC based on their current investment in purchasing the systems. NECC based the 2.5-year delay on a 9-12 month development of the software identified by other interested Vendors and a 1.5-year delay in developing and installing the new equipment at the various locations. Since the TORA Weapons Simulator is a marksmanship-training requirement, it is required to meet essential pre-deployment readiness of deploying service members; the Government cannot invest in a 2.5-year delay.

The Contracting Officer issued a second Sources Sought on 27 May 2021 thru 15 June 2021; which yielded only one response, from Conflict Kinetics. Conflict Kinetics was found to be technically acceptable as they are the manufacturer and developer of the software used in their simulator system.

Therefore, the Sources Sought and Market Research has shown that there are no other systems available that provide the same capabilities. NECC previously reviewed two other companies who provides weapons simulators to DoD; however, neither company has software or training programs that meet the needs of NECC for close in move and shoot as required for building clearance and ship boarding operations. This is a Navy Cat III Shooting requirement.

Lastly, Conflict Kinetics Corporation does not utilize subcontractors who may be able to provide the support required with assistance with the Government.

Based on the information collected from the Sources Sought, and other research methods outlined above, there is not an expectation that two (2) or more acceptable proposals will be received. Therefore, the

Contracting Officer’s recommendation is to issue a sole source award to Conflict Kinetics Corporation.

7. Determination of Fair and Reasonable Cost. 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.

8. Actions to Remove Barriers to Future Competition.

NECC has reached out to Conflict Kinetics Corporation with the intention of procuring the data package to avoid further sole source actions. However, Conflict Kinetics has been unwilling to provide their data package and risk losing their proprietary rights.

NAVSUP FLC Norfolk is currently competing acquisition of certain components of the simulator systems where it is possible. The simulator does have routine replacement items, such as weapons and other assorted peripherals (magazines, compressed air recharging stations, etc.) that are vendor neutral. These items are being competed under a separate contract.

For the reasons set forth in paragraph 5, NAVSUP FLC Norfolk has no further plans, at this time, to compete future contracts for the type of services covered by this document. If another potential source emerges, NAVSUP FLC Norfolk will assess whether competition for future requirements is feasible.

In accordance with PGI 206.302-1(d), a sources sought notice was posted to the Government-wide Point of Entry (GPE) on 27 May 2021 thru 15 June 2021; which yielded only one response, from Conflict

Kinetics. Conflict Kinetics was found to be technically acceptable as they are the manufacturer and developer of the software used in their simulator system.

In addition, if the instant acquisition is a non-competitive follow-on acquisition of supplies or services previously awarded on a non-competitive basis, a copy of the previous justification must be included in the review package, to assist the approval authority in determining whether the planned actions to remove any barriers to competition cited on the previous justification were completed. Include language to identify whether the planned actions were completed and why the barrier remains despite the completion of those actions. If the planned action were not completed, explain why and discuss the new plan to remove barriers to future competition.

Pursuant to DFARS PGI 206.303-2(b)(i) and 206.304(a)(S70), “(f)or a non-competitive follow-on to a previous award for the same supply or service supported by a justification for other than full and open competition citing the authority at FAR 6.302-1, the approval official must determine whether the planned actions to remove barriers to competition were completed. The approving official has reviewed the pervious justification which indicated” NECC has reached out to Conflict Kinetics Corporation with the intention of procuring the data package to avoid further sole source actions. However, Conflict Kinetics has been unwilling to provide their data package and risk losing their proprietary rights. For the reasons set forth in paragraph 5, NAVSUP FLC Norfolk has no plans, at this time, to compete future contracts for the type of services covered by this document. If another potential source emerges, NAVSUP FLC Norfolk will assess whether competition for future requirements is feasible. The approving official has reviewed the prior justification and has considered the market research performed on for this follow-on action, and has determined that the actions to attempt to remove the barriers to competition have been completed.

9. Contracting Point of Contact The point of contact at the FLC Norfolk is Jill Joscelyn, Code 230.1, who can be reached by phone at (757) 443-1219 or by e-mail at jill.joscelyn@navy.mil.