LSJ_47QSWC24K0026_Water Systems BPA III-V2 (2)_Redacted.pdf

Limited Source Justification: AFLCMC BEAR WATER SYSTEM BPA

General Services Administration Federal Acquisition Service (FAS), General Supplies and Services (GSS), Large Special-

Order Program (SOP), (QSCBD)

Combined Limited Source Justification (LSJ) and

Justification for Other than Full and Open Competition (JOCFOC)

I. IDENTIFICATION OF THE AGENCY AND CONTRACTING ACTIVITY:

Contracting Activity: General Services Administration (GSA) Federal Acquisition Service (FAS) Southwest Supply Acquisition Center, Large SOP 819 Taylor St., Fort Worth, TX 76102

Requiring Activity and Address: Air Force Life Cycle Management Center (AFLCMC), Basic Expeditionary Airfield Resources (BEAR), Robins Air Force Base (AFB), GA

Description of Requirement: Water Systems Brand Name(s): Highland Engineering Inc. (HEI) GSA’s Acquisition PIID # 47QSWC24K0026 Vendor’s Name and Address: Highland Engineering Inc

1153 Grand Oaks, Howell, MI 48843 Procurement Vehicle: Multiple Award Schedule (MAS), FAR 8.4 Primary North American Industry Classification System (NAICS) code and Title:

Size Standard:

325998: All Other Miscellaneous Chemical Product and Preparation Manufacturing

650 Employees GSA Category/Special Item Number (SIN) and description:

325998W: Water Treatment Solutions

Product Service Code (PSC) code and Title:

4630: Sewage Treatment Equipment

Period of Performance (POP):

One (1) Base Year with two (2) One-Year Option Periods and one (1) nine-month Option Period (subject to change based upon actual award date)

Estimated BPA Value:

II. NATURE OR DESCRIPTION OF THE ACTION BEING APPROVED:

This action is to request the approval of a single award Blanket Purchase Agreement (BPA) for the supply of water system equipment, Part Numbers 701-4320015623858 (CLIN 0001), 701- 4320015626244 (CLIN 0002), 701-4320015626245 (CLIN 0003), 701-15002 (CLIN 0004), 701-

4610015626563 (CLIN 0005), 701-4320015626242 (CLIN 0006), 701-1500-191 (CLIN 0007), and freight (CLIN 0008) in support of the Basic Expeditionary Airfield Resources (BEAR) Program at AFLCMC, RAFB, GA.

This Limited Source Justification (LSJ) serves to support the procurement as a single-source award for deliverables manufactured and distributed by Highland Engineering Inc (HEI). HEI certified they do not have authorized distributors, Open Market or on Schedule.

This BPA will be awarded against HEI’s GSA Multiple Award Schedule (MAS) contract, GS- 07F-0199U (ultimate contract end date January 31, 2028) in accordance with FAR 8.405-3 Blanket purchase agreements (BPAs). Sources were limited in accordance with FAR 8.405- 6(a)(1)(i)(B), only one source 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.

III. Description of the supplies or services required to meet the agency’s needs (including the estimated value):

Product Description(s):

SOURCE RUN WATER DISTRIBUTION SUBSYSTEM: Part Number 701-4320015623858 (CLIN 0001). The Source Run Subsystem (SRS) provides raw water input (source water) for the contingency water system. It can pull water from a raw water source (i.e., river, lake, sea, or ocean) up to 100 feet away and 20 feet below the pumping station. The SRS can pump source water up to a distance of 6000 feet and to a height of 150 feet to a raw water storage tank.

550 INITIAL WATER DISTRIBUTION SUBSYSTEM: Part Number 701-4320015626244 (CLIN 0002). Primary water distribution subsystem of the contingency water system. The subsystem may be deployed as a stand-alone water distribution subsystem; however, it is designed for expansion and buildup to meet varying user deployment and operational needs. The 550-I subsystem normally receives potable water input from the Water Production System (WPS). However, supplied adapters also provide a means to draw water from other similar potable water sources. Potable water input to the subsystem is typically distributed to three 20,000-gallon fabric storage tanks. The water in these tanks is distributed via a variable speed dual pumping station. The two pumps are parallel configured, enabling dual or single pump operation, and single pump isolation for maintenance or repair purposes. Either pump is capable of maintaining water pressure within the loop distribution line.

550 FOLLOW-ON WATER DISTRIBUTION SUBSYSTEM: Part Number 701- 4320015626245 (CLIN 0003). Designed for expansion and build-up of the 550 Initial Subsystem. The 550 Follow-On Subsystem is not intended to function alone. The 550 Follow-On Subsystem, when used as an expansion to the 550 Initial Subsystem, operates functionally identical to the 550 Initial Subsystem. User facilities such as latrines, showers, laundries, and kitchens are branch fed from the pressurized feed line. Waste output from the user facilities is processed by various lift pumps, and wastewater lines which distribute the wastewater to a collection tank for disposal. The 550 Follow-On Subsystem provides three 20,000-gallon collapsible fabric tanks, four 3,000-gallon collapsible fabric tanks, four Bladder Water Level

Controllers, two Sewage Ejector Systems (Latrines), one Sewage Ejector Lift Station (Kitchen), one Macerator Pump Station, hoses, and ball valves.

1500 ROWPU: Part Number 701-1500 (CLIN 0004). 1500 Gallon Per Hour Reverse Osmosis Water Purification Unit (ROWPU)

ROWPU WATER PRODUCTION SUBSYSTEM: Part Number 701-4610015626563 (CLIN 0005). Generates potable water for distribution to user facilities within the contingency water system.

INDUSTRIAL OPERATIONS AND FLIGHTLINE EXTENSION SUBSYSTEM: Part Number 701-4320015626242 (CLIN 0006). Potable water expansion subsystem for the 550-Initial, 550- Follow-On, or Water Production Subsystems. The extension subsystem can branch off any part of the 3-inch pressurized feed line from these systems and can supply potable water to isolated user facilities such as latrines, showers, and kitchens. Additionally, hose rollover protection ramps (hose bridges) safeguard hoses in the event potable water distribution lines need to cross roadways or similar heavy vehicular traffic areas.

POWER ADAPTER: Part Number 701-1500-191 (CLIN 0007). Power adapter cable for use with ROWPU.

FREIGHT: (CLIN 0008). Open market shipping.

CLIN Description Part Number

0001 SOURCE RUN WATER DISTRIBUTION

SUBSYSTEM

701-4320015623858

0002 550 INITIAL WATER DISTRIBUTION

SUBSYSTEM

701-4320015626244

0003 550 FOLLOW-ON WATER DISTRIBUTION

SUBSYSTEM

701-4320015626245

0004 1500 ROWPU 701-1500

0005 ROWPU WATER PRODUCTION SUBSYSTEM 701-4610015626563

0006 INDUSTRIAL OPERATIONS AND FLIGHTLINE

EXTENSION

701-4320015626242

0007 Power Adapter 701-1500-191 0008 Freight Open Market

In accordance with FAR 8.405-3(d)(3), Contractors may be awarded BPAs that extend beyond the current term of their GSA Schedule contract, so long as there are option periods in their GSA Schedule contract that, if exercised, will cover the BPA’s period of performance. Given, HEI Schedule contract expires January 31, 2028 (ultimate end date), this BPA is for a one (1) base year, with two (2) one-year options and one (1) nine-month option (subject to change based upon actual award date. The estimated value of is based upon historical data and estimated orders in the pipeline. During annual review of the BPA IAW FAR 8.405-3(e), the contracting officer shall determine in writing whether the schedule contract, upon which the BPA was established, is still in effect, the BPA still represents the best value IAW FAR 8.404(d), and estimated quantities/amounts have been exceeded and additional price reductions can be obtained.

IV. The authority and supporting rationale (see FAR 8.405-6(a)(1)(i)(B) and FAR 6.302-1) and, if applicable, a demonstration of the proposed contractor’s unique qualifications to provide the required supply or service:

This acquisition will be conducted under the authority of the Multiple Award Schedule (MAS) Program. The primary statutory authorities for MAS are Title III of the Federal Property and Administrative Services Act of 1949 (41 USC 251 ET SEQ), and Title 40 U.S.C. 501, Services for Executive Agencies.

This acquisition will be procured using the MAS program under GSA Special Item Number/GSA Category 325998W, titled: Water Treatment Solutions. FAR 8.405-6(a)(1)(i)(B) applies when only one source 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. For administrative convenience, FAR 8.402(f) allows a contracting officer to add items not on the FSS (also referred to as open market items) to a FSS BPA. Since HEI’s MAS contract shipping terms are Freight on Board (FOB) Origin, the Government anticipates freight for orders placed under the BPA to be open market and for the total value of the freight estimated at Freight will be evaluated at the order level for price reasonableness. To streamline the acquisition process, the sole source justification for the open market portion of this contract shall also be addressed in this document and the authority at FAR 6.302-1, soliciting from a single source, is applicable to the open market freight costs. Approvals at the specified levels IAW FAR 6.302-1 and FAR 8.405-6(d)(3) are being obtained.

HEI owns the data rights to the BEAR Water Systems and is the only source for this mission critical system. The United States Air Force (USAF) currently owns of various HEI water subsystems, CLINs 0001-0006. The USAF plans to procure an estimated additional 112 water subsystems, through FY27, to fulfill War Readiness Materiel (WRM) requirements.

The BEAR water system, consisting of modular subsystems, is used to support contingency hygiene, personnel support, construction, and airfield operations and any change to the configuration will drive immediate, time consuming/costly, changes to the USAF Unit Type Code (UTC) deployment kits. The USAF has spent 20 years fielding the BEAR water system with a total cost (to date) of over . The United States Air Force (USAF) currently owns of various water subsystems purchased via the previous BPA with GSA.

Based on the previous efforts, it would take at least 2 years to solicit, award, develop, test, and start production on a new water system if/when a new source is required.

The water system is fully provisioned in the federal supply system and a government technical order has been developed at a cost of over .

The USAF has spent over establishing the Water Purification and Distribution training program proficiency. Nine (9) USAF Civil Engineering contingency training sites have been upfitted with complete Water Systems to support training of 500 Water and Fuel Systems personnel annually.

To date, the USAF has spent over procuring support and spares kits. These kits include the items needed to install, operate, and maintain in contingency environments.

The BEAR Water System is an essential life sustainment capability. Authorization to use required extensive coordination/approvals from the military health services and comply with commercial water safety standards, consuming months for system certifications.

The BEAR Water Subsystems are currently positioned at sixteen (16) WRM storage locations around the globe. The USAF has provided facilities and equipment needed to maintain the systems, while in storage, and train the WRM contractor personnel at each of these locations.

HEI certified they are the only authorized manufacturer and distributor of the water systems, Part Numbers 701-4320015623858, 701-4320015626244, 701-4320015626245, 701-1500, 701- 4610015626563, 701-4320015626242, and 701-1500-191, currently under GSA contract and in the open market. HEI sells the required item via their MAS Contract, GS-07F-0199U (ultimate contract end date January 31, 2028).

As the sole manufacturer and distributor, HEI has unique qualifications to properly ship the BEAR water systems. HEI has attested the following added value services to the Government:

Highland Engineering offers their best price to the government. Distributors would increase the overall cost to the government.

Highland Engineering offers their best delivery to the government. Distributors would increase the overall lead time to the government. Current lead time for all BEAR Water Systems is 365 days after receipt of order (ARO).

Highland Engineering works with multiple logistics organizations to ship by air, land, and sea (US Flagged only) around the world, including Asia, Europe, and the Middle East. Highland has delivered to all of these locations on previous GSA BPA orders. This network allows Highland to deliver the Water Systems efficiently and economically.

Highland Engineering has been operating for almost 40 years and doing business with the government for almost as long. They are a proven supplier on contracts as small as

Highland Engineering has the necessary personnel, equipment, space, and working capital to deliver a quality product the government needs in a timely manner. Highland also has an open line of credit with their bank, if needed.

Based on all the above information regarding the water system effort to date, it would require substantial duplication of cost, estimated at to the government, which is unlikely to be recouped through competition. Furthermore, it would lead to unacceptable delays, considering the estimated two (2) years it would take to develop, test, and start production on a new water system to replace the existing HEI water system. Additionally, sourcing a new water system would require thousands of man-hours and incur in cost for development, testing and implementation of new water systems into the WRM stock.

Therefore, the circumstances and rationale for limiting consideration to HEI for award have been met IAW with FAR 8.405-6(a)(1)(i)(B) – Only one source 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 and FAR 6.302-1 Only one responsible source and no other supplies or services will satisfy agency requirements for the freight expenses.

V. Determination by the ordering activity contracting officer that the order represents the best value consistent with 8.404(d):

The best value determination will be conducted and documented prior to award. By placing an order against a Schedule contract using the procedures in FAR 8.405, the ordering activity has concluded the order represents the best value (as defined in FAR 2.101) and results in the lowest overall cost alternative (considering price, special features, administrative costs, etc.) to meet the Government’s needs. Any quote submitted by HEI will be reviewed to ensure pricing terms are in accordance with their MAS contract. Freight will be evaluated at the order level for price reasonableness.

In accordance with FAR 8.404(d) Pricing, GSA has already determined the prices of the supplies and fixed-price service under Schedule contracts to be fair and reasonable. However, the Department of Defense (DoD) has issued Class Deviation 20014-00011, dated March 13, 2014, whereby the Contracting Officer is responsible for making a determination of fair and reasonable pricing for BPAs using the proposal analysis techniques outlined in FAR 15.404-1. Because this requirement is one-source, the Government will be utilizing at least two methods by which to determine pricing submitted by HEI to be fair and reasonable. These techniques include, but not limited to, the following:

Requesting recent commercial and Government sales history Making indirect pricing comparisons to:

o the same or similar items in the marketplace, o competitive published price lists, and o Independent Government Estimates.

VI. DESCRIPTION OF MARKET RESEARCH CONDUCTED:

Market research was conducted in accordance with FAR Part 10 to determine the availability of products capable of meeting the Government’s requirement. Market research revealed the required items were not available through AbilityOne, UNICOR, Green Procurement Compilation or Interagency Contract Directory Portal. Market research did reveal the required water system equipment is available on GSA Advantage website under the MAS Program.

HEI is the only contractor capable of meeting the Government’s needs. In the interest of promoting competition, a Request for Information (RFI) RFQ1674554 and RFI 47QSWC24K0026 was posted to GSA eBuy and SAM.gov on 01/18/2024 with a due date of 02/17/2024. The RFI specified the water systems part numbers that must be supplied without substitute and asked potential offerors to submit their capability to provide the specific part numbers. The posting provided industry the opportunity for a 30-minute industry call (one-on-one) with GSA. To date, no other vendor has expressed interest in the water systems requirement other than HEI.

VII. Any other facts supporting this justification:

GSA previously awarded BPA 47QSWC19A0009 and GS22Q17BGA0020 against the HEI MAS contract GS-07F-0199U. These BPAs were also justified as limited source procurements under FAR 8.405-6(a)(1)(i)(B), based on the Government specifications.

VIII. A statement of the actions, if any, the agency may take to remove or overcome any barriers that led to the restricted consideration before any subsequent acquisition for the supplies or services is made:

The customer completed a market research report in an effort to overcome barriers that led to the restricted competition of the previous BPA. The customer surveyed contractors based on internet searches, results from the Dynamic Small Business Search, and known sources from current and past acquisitions. The BEAR water subsystems and their components are uniquely designed for BEAR and fully provisioned for the BEAR program and is a commercial item exclusively available through HEI. For the purpose of the customer market research report, considerations were based on contractors’ product portfolio and manufacturing capabilities to produce a similar system or the same system if provided the specification/design data and intellectual property.

Four contractors were contacted, which are listed below, have the capabilities to produce a quality system that would meet system requirements - if the AF were to change the specifications or modify the design of the current water system.

JGB Enterprise Inc.:

JGB is a large business that has engineering, design, and manufacturing capabilities. JGB has not manufactured the 1500 ROWPU but has provided the 1500 ROWPU to the government using HEI as the sub-contractor. JGB cannot manufacture and supply the 1500 ROWPU to the government as they do not have the manufacturing line to achieve this at the current time, nor the technical data rights to do so. If the manufacturing line was stood up the Government would want to accomplish a first article testing and determine if their technical manual is correct, usually a one-year endeavor.

Fort Defiance Industries:

Fort Defiance Industries (FDI) is a registered medical device manufacturing company that specializes in ruggedized medical equipment for use in military field hospitals, disaster relief hospitals, and remote area medical clinics. FDI is the sole source provider for the U.S. Army current field hospital water systems. Their systems are utilized throughout the several branches of the US military and can be configured to serve a wide range of applications in the field. FDI has no experience in manufacturing BEAR systems but has produced systems for Army medical facilities and equipment. Their systems have similar form and function to the BEAR system although they are not directly compatible in fit and scale.

Aspen Water, Inc.:

Aspen Water, Inc. (AWI) is a small business that designs, manufactures, and distributes compact portable water treatment systems designed primarily for use by rapid deployable units. AWI possesses the knowledge and skills to produce systems in any scale but do not currently produce any systems that match the scope or compatibility of the BEAR water system. Therefore, their capabilities and capacity to produce BEAR water systems is not currently available to determine if they would be able to deliver the required quantities to meet the BEAR program requirements.

HEI is currently the only source capable of meeting the Government’s needs. Until it is determined that HEI no longer meets AFLCMC requirements, these parts will be procured from HEI. To continue the process of overcoming barriers to competition, AFLCMC will continue to evaluate the capabilities of other vendors through continuing market research and any changing needs of AFLCMC. Furthermore, AFLCMC will continue to evaluate the best transportation mode. The Government will continue to search both the Internet for possible sources of supply in addition to synopsizing any intent to negotiate with a single source for future requirements, thereby keeping industry aware that the Government is aware of no other sources for the required part numbers. Additionally, this justification will be posted to SAM.gov within fourteen (14) days of award for a minimum of thirty (30) days in accordance with FAR Subpart FAR 8.405- 6(a)(2)(i).

IX. TECHNICAL/REQUIREMENTS CERTIFICATION:

I certify that the supporting data under my cognizance, which is included in this justification, is accurate and complete to the best of my knowledge and belief.

Date

Program Manager Air Force Life Cycle Management Center (AFLCMC) Basic Expeditionary Airfield Resources (BEAR) Robins AFB, GA

CONTRACTING OFFICER CERTIFICATION AND APPROVAL:

The contracting officer has determined that the appropriate actions were taken under this acquisition to meet the conditions described in FAR 8.405-6(a)(1)(i)(B) and FAR 6.302-1. The information contained in this justification is accurate and complete to the best of the Contracting Officer’s knowledge and belief.

Daniel Herrera Date Contracting Officer, Large SOP (QSCBDA)

APPROVALS:

One Level Above, Large SOP (QSCBDA) Date

Branch Chief, Large SOP (QSCBD) Date

Director, Special and Assisted Contracting Certification (QSC) Date

Operational Guidance Branch SME (QSA) Date

Assistant Regional Counsel (LD7) Date

Competition Advocate (QSA) Date

Contracting Executive (QSC)

APPROVAL AUTHORITY CERTIFICATION

I, the approving authority, determine that the circumstances identified in this document are accurate; therefore, limiting competition to one source under FAR 8.405-6(a)(1)(i)(B) and FAR 6.302-1 is justified. The signature below also represents approval of this Limited Sources Justification.

Contracting Executive (QSC), Delegated HCA Authority