4.d. JA Reintjes Gear REDACTED.docx

SOLE SOURCE JUSTIFICATION

For Certain Commercial Items for Procurements Exceeding the Simplified Acquisition Threshold pursuant to FAR Subpart 13.5, Including Brand Name

Solicitation 70Z04021Q55900B00

In compliance with Federal Acquisition Regulation (FAR) 13.501(a)(ii), this justification uses the format at FAR 6.303-2 and is modified to state that the procedures in FAR subpart 13.5 are used.

1. Agency and Contracting Activity.

The Department of Homeland Security, United States Coast Guard (USCG), Surface Forces Logistics Center (SFLC), Small Boat Product Line (SBPL), and Contracting and Procurement Division 3 (C&P3) located at 2401 Hawkins Point Road, Baltimore, MD 21226 prepared this justification for other than full and open competition.

2. Nature and/or Description of the Action being Approved.

(a) Nature of the action: USCG intends to procure on a brand name basis overhauled and new Reintjes Marine Reduction Gears.

(b) Name and address of the contractor:

Original Equipment Manufacturer:

Reintjes GbmH Eugen-Reintjes-Straße 7 31785 Hameln, Germany

(c) Type of action: Firm Fixed-Price Requirements Type Contract

(d) Estimated total value (including options):

Preservation, Packaging and Marking

$54,372.00

$56,003.16

$57,683.25

$59,413.75

$61,196.17

The Independent Government Estimate (IGE) is derived from current material pricing and previous acquisition history. Actual pricing data was extracted from NESSS using previous contracts. To adjust for inflation over the option years and account for market volatility due to COVID-19, a 3% escalation factor was applied. This escalation factor is composed of Consumer Price Index rate with added adjustment to account for economy and market volatility due to COVID-19.

Note: Previous contract HSCG40-16-D-53000 expires 09/08/2021

(e) Type of funding: Operations and Support funds

(f) Year of funding: Fiscal Year 2021

(g) Solicitation number: 70Z04021Q55900B00

(h) Background information about the requirement: The USCG, SFLC, SBPL, has an ongoing requirement on a brand name basis for the overhaul and supply of Original Equipment Manufacturer (OEM), Reintjes GmbH, WVS 234 UP Marine Reduction Gears which conform to the exact form, fit and function of the equipment attached to the main propulsion units installed on the United States Coast Guard’s 47’ Motor Life Boat small boats.

3. Description of Supplies/Services.

This requirement is for the overhaul and supply of the Reintjes transmissions model WVS 234 UP for the United States Coast Guard’s (USCG) SFLC-SBPL-CEO Division. There are two marine reduction gears on each 47’ MLB which convert speed and torque transmission propulsion from the main diesel engine power. Each reduction gear scheduled for overhaul is to be disassembled, inspected, overhauled, tested, preserved, packaged, and marked to like-new condition using only authorized OEM repair facilities and only genuine OEM replacement parts. If a marine gear is found to be Beyond Economic Repair (BER), a new gear will be supplied.

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

The statutory authority of 41 U.S.C. 1901 permitting other than full and open competition as implemented by Federal Acquisition Regulation (FAR) Subpart 13.501, Simplified Procedures for Certain Commercial Items.

5. Identification of Exception to the Buy American Act.

The Coast Guard has not identified an exception to the Buy American Act.

6. Demonstration that the Proposed Contractor’s Unique Qualifications or the Nature of the Acquisition Require Use of the Authority Cited.

This is a brand name requirement for the overhaul and supply of Reintjes marine reduction gears used on the 47’ Motor Life Boat transmission systems. The Coast Guard does not possess the necessary manufacturing data or test procedures to be able to solicit the requirement as full and open competition. The technical data required to overhaul these marine gears is proprietary to Reintjes GmbH. Without adequate data, the Coast Guard is not capable of evaluating the viability of non-OEM parts or alternate overhaul facilities without complete access to the OEM's overhaul and testing procedures. Authorized repair facilities are necessary due to OEM-specific tooling needed to overhaul the gears, and the use of OEM parts will ensure components and processes are sufficient to enable physical and functional interchangeability, as well as identifying source, size, configuration, and performance requirements.

Only contractors within the Reintjes distribution network will be able to fulfill the overhaul and supply needs of this requirement in accordance with the OEM specifications. The use of non-OEM parts could cause equipment failure including, but not limited to a failure of bearings, clutch assembly, seals, springs, or couplings, thus disabling the assets of proper forward and reverse maneuverability.

Based on market research, the only companies that can satisfy this requirement are Reintjes GmbH or their authorized distributors and/or repair facilities.

7. Description of Efforts Made to Ensure that Offers are Solicited from as Many Potential Sources as is Practicable.

In an effort to identify alternative sources, a Sources Sought Notice (SSN), 70Z04021S55900B00, was posted on beta.SAM.gov on February 24, 2021, inviting industry to demonstrate capability in providing both overhauled and new marine reduction gears required for Coast Guard’s 47’ MLB small boat platform. The notice provided possible sources 14 calendar days to respond and provide their capabilities to perform the requirements. Only one response was received. On March 5, Great Lakes Power Service Company stated their intent to bid on a future solicitation, however their response also explained that they would be limited to bidding on the overhaul portion of the requirement only, as they are not an authorized distributor capable of providing new Reintjes gears. A follow-up email was sent to Great Lakes Power Service Co. requesting further details on their access to authentic, OEM parts necessary for the overhaul portion of the requirement, but no response was received.

Karl Senner, LLC is the only authorized distributor and repair facility of Reintjes parts and components in North America. While Karl Senner, LLC did not reply to the Sources Sought Notice, they are the holder of existing contract HSCG40-16-D-53000 and have received satisfactory past performance ratings fulfilling similar requirements. In an email dated 3/18/21, the Coast Guard directly asked Karl Senner, LLC if they intended on bidding on a future solicitation to this requirement, and on 3/19/21, Karl Senner, LLC replied in the affirmative.

8. Determination by the Contracting Officer that the Anticipated Cost to the Government will be Fair and Reasonable.

The Contracting Officer anticipates that the cost to the Government will be fair and reasonable based on prior acquisition history of marine reduction gears and associated parts and price analysis in comparison with the Independent Government Cost Estimate. Additionally, the offeror may be required to submit Data Other than Certified Cost or Pricing Data (FAR 15.403-3) to support price negotiations, if deemed necessary by the Contracting Officer.

9. Description of Market Research.

Market research, as prescribed in FAR Part 10, was conducted by the Contracting Officer’s Representative (COR), Contracting Specialist and Contracting Officer from September 2019 through March 2021 in an effort to identify alternative sources that can provide both overhauled and new reduction gears. Specifically, an extensive Internet search was conducted in order to locate price and availability of parts, the Reintjes distributor was contacted for estimates and availability of parts and several Government databases were reviewed for potential availability. The OEM’s website clearly states there is only one authorized distributor of Reintjes gears in North America. These gears are not available on GSA. Market research has indicated that these OEM gears and their associated parts can only be procured from the OEM or through their sole distributor in North America, Karl Senner, LLC.

10. Any Other Facts Supporting the Use of Other Than Full and Open Competition.

None.

11. A Listing of the Sources, if Any, that Expressed, in Writing, an Interest in the Acquisition.

Karl Senner, LLC 25 W. 3rd Street Kenner, LA 70062

Great Lakes Power Service, Co.

7455 Tyler Blvd Mentor, OH 44060

12. A Statement of the Actions, if Any, the Agency May Take to Remove or Overcome Any Barriers to Competition Before Any Subsequent Acquisition for Supplies or Services Required.

An initial request was emailed to the OEM on February 24, 2021 to inquire if the data rights to these reduction gears were available for sale and at what price. Also indicated was that no response would be perceived as a presumed negative response. No response was received. A follow-up request was emailed to the OEM on March 19, 2021, and no response was received. Although the Coast Guard does not currently own the required drawings, specifications, etc., to evaluate other than OEM parts, the Government will make all attempts to try and procure data rights in an effort to increase competition.