JOTFOC_Sole_Source_B53F&G_5-28-19_signed.pdf

Justification and Approval for Other than Full and Open Competition Sturgeon Electric Company

U.S. General Services Administration

JUSTIFICATION FOR OTHER THAN FULL AND OPEN COMPETITION

Only One Responsible Source - FAR 6.302-1

Sol # 47PJ0019R0112

The Public Buildings Service of the General Services Administration, Rocky Mountain Region, proposes to contract the requirements described herein by means of other than full and open competition. Contracting by such means is authorized by FAR Subpart 6.3 and is supported by this justification prepared in accordance with FAR 6.303-2.

1. Identification of the agency and the Contracting Activity: General Services Administration, Public Buildings Service, Rocky Mountain Region, Denver Federal Center Service Center.

2. Description of Required Supplies or Services: This justification authorizes and approves a sole-source construction activity to Sturgeon Electric Company (Sturgeon) to alter the existing electrical grid at the Denver Federal Center, Lakewood, Colorado. More specifically, Sturgeon would add new power legs routed to the DHS Megacenter in Building 53 of the Denver Federal Center, work that includes replacement of three on-site transformers and all necessary related work.

3. Description of the supplies or services required to meet the agency’s needs, including the estimated value:

This project will include modifying the Denver Federal Center electrical grid at Building 53 F Line and G Line (F&G) additional legs to the DHS MegaCenter and will replace three unsafe transformers.

Please see project scope for exact work description.

The estimated cost for this project is $646,198.80. This total project cost is based on an estimated $538,553 for material and labor plus a contingency of 16.67 percent. (Usually, projects of this nature require a contingency between 10-20%). The estimate is based on costs attributed to each affected building/area, as follows: Building #53/64 $293,693; Building 53 F,G $172,380; and Building 64/52 $72,480. The following table further breaks down the subtotal estimated cost:

Building #53/64 Budgeted Cost for Upgrades Area Item Unit Description Material Labor Unit Cost Replace Y Tap Box and Add X Feeder

1 Lot Remove existing tap box L3-M-1- 027, 028

$178 $1,322 $1,500.00 $1,500

905 Ft Remove existing Y feeders in ductbank

$0.45 $2.97 $3.42 $3,097

1 Ea New manhole for X & Y side

$6,500 $3,000 $9,500.00 $9,500

1 Lot New terminations

$645 $1,855 $2,500.00 $2,500

New #500 X & Y Feeder to Manhole

450 Ft New X Feeder from PMH-11 to

$36.15 $48.52 $84.67 $38,103

Manhole 450 Ft New Y Feeder from PMH-11 to Manhole

$36.15 $48.52 $84.67 $38,103

1 Ea Supply and install PMH-11 in old PMH-9 location for Y

$24,890 $13,715 $38,604.98 $38,605

1 Ea Supply and install PMH-11 in old PMH-9 location for X

$24,890 $13,715 $38,604.98 $38,605

New #500 X & Y Feeder from Manhole to PHM-9s

1 Ea Supply and install PMH-9 at new location by #52

$25,480 $13,864 $39,344.18 $39,344

1 Ea Relocate PMH-9 at new location by #52

$8,401 $6,099 $14,500.00 $14,500

405 Ft New #500 cabling between PMH switches Y side

$36.15 $48.52 $84.67 $34,293

405 Ft New #500 cabling between PMH switches and new fusing X side

$36.15 $48.52 $84.67 $34,293

1 Lot Transformer terminations

$384 $866 $1,250.00 $1,250

Total $293,693 Building 53 F,G Budgeted Cost for Upgrades Area Item Unit Description Material Labor Unit Cost Add X Feeder and Replace Live Front 500kVA Transformer

1 Ea Remove existing transformer with live single feed

$410 $790 $1,200.00 $1,200

1 Ea Supply and install PMH-9 in old PMH-7 location

$25,480 $13,864 $39,344.18 $39,344

2 Ea Install new 500kVA transformer

$30,689 $27,298 $57,987.00 $115,974

180 Ft New #2 cabling in from new PMH-9 switch and new fusing Y side

$18.70 $21.89 $40.59 $7,306

180 Ft New #2 cabling to relocated PMH-9 switch

$18.70 $21.89 $40.59 $7,306 and new fusing X side

1 Lot Transformer terminations

$384 $866 $1,250.00 $1,250

Total $172,380 Building 64/52 Budgeted Cost for Upgrades Area Item Unit Description Unit Cost Bring X Feed to Replaced PHM-9

1 Ea Supply and install PMH-9 in old PMH-7 location

$25,480 $13,864 $39,344.18 $39,344

175 Ft New #500 cabling between PMH switches Y side

$36.15 $48.52 $84.67 $14,818

175 Ft New #500 cabling between PMH switches and new fusing X side

$36.15 $48.52 $84.67 $14,818

1 Lot Kirk Key Interlocks

$1,740 $1,760.00 $3,500.00 $3,500

Total $72,480

4. Statutory Authority Permitting Other than Full and Open Competition: 41 U.S.C. § 3304(a)(1), as cited in FAR 6.302-1, allows for other than full and open competition when the supplies or services that the Government requires are available from only one responsible source, and no other type of supplies or services will satisfy the needs of the Government.

5. Demonstration that the Nature of the Acquisition Requires Use of the Cited Authority:

In accordance with FAR 6.302-1, it is permissible to acquire supplies or services without competition where, as here, the supplies or services are available from only one responsible source and no other source will satisfy the needs of the agency. In this case, GSA must ensure that the electrical grid at the Denver Federal Center remains unharmed so as to prevent catastrophic damage to electrical infrastructure and to ensure that the many federal agencies that depend on seamless use of space at the Denver Federal Center is not interrupted. Sturgeon is currently the contractor for GSA’s electrical grid maintenance contract covering all of the Denver Federal Center. Award to any other contractor would introduce additional complexity to the arrangement of contractors responsible for and working along the electrical grid. Any additional complexity would increase the chance of a mistake on the part of the additional crews who would be working on the grid, which in turn would increase the possibility of a catastrophic and total failure of the electrical grid. As such, awarding this contract to Sturgeon, which is already responsible for continued maintenance and repair of the electrical grid, is primarily to reduce risk of a catastrophic failure along the DHS Megacenter electrical grid. Too, Sturgeon has demonstrated good past history and performance.

As background, GSA is responsible for maintaining all federal buildings and supporting systems at the Denver Federal Center in Lakewood, Colorado, and ensuring that the federal office buildings on site preserve the health and welfare of federal employees who work within the buildings. The Denver Federal Center houses the Department of Homeland Security (DHS) MegaCenter data center in one of its buildings. The electrical grid around the DHS MegaCenter requires considerable improvements in order for the MegaCenter to continue to provide the expected level of service to the DHS tenant.

GSA identified, among other things, three unsafe and non-code-compliant electrical transformers around the MegaCenter that need to be removed and replaced with current, code-compliant transformers. This work would allow the MegaCenter to continue to provide the level of service required by the tenant agency, DHS.

As stated above, Sturgeon is the GSA contractor for an operations and maintenance (O&M) contract for all electrical grid improvements on the Denver Federal Center grounds. As the O&M contractor tasked with maintaining the grid, Sturgeon operates, maintains, and keeps in good repair all of the electrical distribution system around the Denver Federal Center. In a sense, Sturgeon acts in a capacity for the Denver Federal Center as an electric utility company would for a larger region.

Sturgeon is responsible for all repairs, maintenance, alterations, and response to unexpected failures in the existing Denver Federal Center electrical grid systems and components as electricity traverses from the Xcel Energy-maintained electrical grid which enters the DFC from the City of Lakewood to the medium voltage transformers servicing the approximate 50 buildings located within the Denver Federal Center’s approximately one square mile campus.1

Because of the complexity involved in maintaining the entirety of the electrical grid without any catastrophic failures by just a single contractor, award to a different contractor for these construction services would increase the likelihood of a catastrophic equipment failure in the electrical grid at the Denver Federal Center. The Public Building Service is aware that when more complexity is added to electrical grid operations, there follows a higher risk of a catastrophic failure—meaning, a higher chance of total blackout. Any risk of catastrophic failure is unacceptable because so many different agencies depend on continuous electricity service in their various offices and lab spaces, that any interruption would have high costs to the ongoing success of all of those agencies’ missions. In maintaining the Denver Federal Center’s electrical grid, the best and safest practice for GSA’s tenant agencies is to hire a single service provider who operates, maintains, and repairs the entire electrical grid throughout the campus. By awarding to Sturgeon GSA alleviates risk of a catastrophic failure occurring.

6. Actions Taken to Remove Competition Barriers and Solicit Offers from Other Sources.

The current operations and maintenance contract with Sturgeon was awarded effective December 11, 2015. Currently, the contract is in its fourth and final option year and is set to expire on November 30, 2019. GSA is preparing a follow-on procurement for the O&M services for the Denver Federal Center electrical grid, which GSA will procure using full and open competition. GSA will ensure that the next O&M contract for electrical grid maintenance will allow for the services required under this Justification to be completed as part of a task order. In other words, GSA will ensure that the next procurement for all types of O&M work for the electrical grid, including replacing transformers like those at issue in this Justification, will be competed—obviating the need for any further justification for other than full and open competition in the future.

7. Determination that the Anticipated Cost/Price will be Fair and Reasonable.

The Contractor’s price has been analyzed by comparing it with comparable market pricing. GSA’s Project Manager, Michael Golenda and GSA’s technical expert, Phil Inman, have consulted with electrical providers on these items to verify pricing. The hourly rate in the estimate is unitized and

1 The current contract with Sturgeon only allows GSA to order replacement of transformers if the estimated cost would below the Simplified Acquisition Threshold (SAT). In this case, the estimated cost exceeds the SAT and therefore is not permitted under the current contract with Sturgeon.

based off of a blended straight time and overtime Sturgeon Electrical rate per CBA requirements, fringes and benefits.

Based on such review, the Government’s estimated cost of $646,198.80 is fair and reasonable based on material and labor pricing and a reasonable markup/contingency of 16.67%. The price analysis will include consideration of the effect of any changes to the Service Contract Act Wage Determinations or Collective Bargaining Agreements.

8. Market Research, FedBizOpps Announcement, and Listing of Interested Sources.

Market research has shown that there are no small businesses contractors available to provide High/Low Voltage, Solar Operation Repair and Maintenance at Denver Federal Center, Lakewood, Colorado. GSA will continue to work closely with SBA to ensure that the Government researches all potential subcontracting opportunities for socioeconomic business concerns.

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

The Government will increase its risk if it does not use Sturgeon Electric Company to fill the requirement beginning June 17, 2019. If GSA were to attempt to fulfill this requirement using a new business concern, it is likely that the transition of employees and knowledge would result in the loss of services.