Welin_Lambie_Davit_Parts_JA_-_REDACTED.pdf

Justification for Other Than Full and Open Competition

Under 10 U.S.C. 2304(c)(1)

Only One Responsible Source and No Other Supplies or

Services Will Satisfy Agency Requirements

Solicitation Number – HSCG40-17-R-20743

Pursuant to the requirements of the Competition in Contracting Act (CICA) as implemented by FAR Subpart 6.3 and in accordance with the requirements of FAR 6.303-1, the justification for the use of the statutory authority under FAR Subpart 6.3 is justified by the following facts and rationale required under FAR 6.303-2 as follows:

(1) Agency and Contracting Activity.

The United States Coast Guard, Surface Forces Logistics Command (SFLC), Norfolk, VA proposes to enter into a contract on the basis of other than full and open competition.

(2) Nature and/or description of the action being approved.

SFLC seeks approval to award a follow-on contract based on other than full and open competition for the procurement of maintenance parts kits; overhaul parts kits; spare parts for inventory at the SFLC warehouse in Baltimore, MD; overhauls of existing davits at the

Welin Lambie facility in England, United Kingdom; manufacture of new davits at the

Welin Lambie facility in England, United Kingdom, and two (2) full time Welin Lambie

Certified Technical Representatives to provide davit support.

The Coast Guard maintenance program supporting Welin Lambie davits require each davit installed aboard cutters to be removed and factory overhauled every eight (8) years.

In the four (4) year intervals between factory overhauls each davit is required to have an in-place overhaul. While less extensive than factory overhauls the scope of this work is the maximum level that can be accomplished without removing the davits from the cutters. When both factory overhauls and in-place overhauls are performed as scheduled, the effective life expectancy of each davit is twenty (20) years. Davits that have exceeded their life expectancy are generally considered Beyond Economic Repair (BER).

The Coast Guard currently owns a total of 66 Welin Lambie davits, of which 49 are currently installed aboard Coast Guard cutters. Of those installed, fifteen (15) are the obsolete Model TW.PIV 5.0A davits which require the procurement and installation of the new Model TW.PIV 5.0B Davits. The Model TW.PIV 5.0A davits are all installed aboard the WLBB 225 cutters, all of which are scheduled for the Coast Guard Maintenance

Midlife Availability (MMA) upgrades to be performed at the Coast Guard Yard in

Baltimore, MD over the next five (5) years.

The remaining seventeen (17) davits owned stocked to maintain a rotatable pool to accommodate the factory overhaul davits removed and returned to the U.K. as scheduled.

Presently, only a total of four (4) of the seventeen (17) are stocked in install-ready condition. The remaining thirteen (13) davits are currently being stored in the Coast

Guard Baltimore warehouse awaiting factory overhaul and/or renewal if deemed BER.

In order to support cutter operations (all requiring functional Welin Lambie Davits to meet

Safety of Life at Sea (SOLAS) requirements) the Coast Guard needs to procure additional

TW.PIV 5.0B Davits over the next five (5) years. Without the procurement of additional davits the Coast Guard will be unable to perform necessary factory overhauls and meet the needs of the MMA extended service life program.

The SFLC intends to award a firm fixed price Requirements contract consisting of a base year with four one year option periods. The procurement of the parts kits, spare parts and overhauls will be purchased via issuance of individually funded delivery orders. A yearly task order will be placed for the Technical Representatives. The parts are manufactured by Welin Lambie Limited, Britannia House, Old Bush Street, Brierley Hill, WES DY5

1UB, the original equipment manufacturer (OEM). The OEM is the only known source of supply based on market research. The total estimated contract value is $26,853,498.32.

The funding will consist of AFC 45 and AFC 30 for the fiscal year in which the award is made. Current year funding will be used for delivery orders and the task order issued for technical support.

(3) Description of Supplies/Services.

The supplies being acquired consist of maintenance parts kits; overhaul parts kits; spare parts for inventory; overhauls of existing davits at the Welin Lambie facility in England, United Kingdom; fabrication of new davits; and two (2) full time Welin Lambie Certified

Technical Representatives to provide davit support for a total estimated cost of

$26,853,498.32.

The total estimated price is shown below:

Period Duration Unit Price Total

Base Year 12 mos. $5,268,685.55 $ 5,268,685.55

Option Year 1 12 mos. $ 5,317,205.36 $ 5,317,205.36

Option Year 2 12 mos. $ 5,368,151.16 $ 5,368,151.16

Option Year 3 12 mos. $ 5,421,644.25 $ 5,421,644.25

Option Year 4 12 mos. $ 5,477,812.00 $ 5,477,812.00

TOTAL $26,853,498.32

(Note: 82% parts – 18% services)

(4) Identification of 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 the Federal Acquisition Regulation

(FAR) Subpart 6.302-1 Only One Responsible Source and No Other Supplies or

Services Will Satisfy Agency Requirements.

(5) Demonstration that the nature of the acquisition requires use of the authority cited.

The davit system is utilized for launch and recovery of various Coast Guard small boats onboard 14 WMEC 210’ cutters, 13 270’ cutters, 16 WLB 225’ cutters, 5 WHEC 378’ cutters and CGC ALEX HALEY. This davit system is essential for execution of primary missions including Search & Rescue, Law Enforcement, and Counter-Narcotics onboard the majority of operational major cutters. Welin Lambie Limited is the OEM for the Welin

Lambie Twin Pivot Davit System. All product lines requiring parts and technical support will be covered under this requirement.

The davit systems are mission critical. The davits are required to be operationally reliable, fully functional, and safe for use in any sea state. The davit systems must provide flexible, operational capability to launch the Motor Surf boat, Cutter Boat-Over the Horizon boat and Rigid Hull Inflatable boats whenever needed, without notice. Not maintaining the capabilities of the davit systems would prevent the Coast Guard from performing critical missions. The impact of poorly maintained, unsafe, or non-operational davit systems cannot be overstated. Parts not manufactured by the OEM would not meet form, fit and function and therefore may render the davit systems inoperable.

Technical support is required to oversee and support the work being accomplished due to the complexity beyond the capability of Coast Guard personnel. Support is required to provide both telephone and on-site technical support for unscheduled repairs beyond the capability of Coast Guard personnel.

The technical support includes but is not limited to either remote or on-site casualty repair support for the davit systems at any potential site where the Coast Guard is present;

maintaining the davit overhaul and training programs; conducting visits to cutter homeports to verify system configuration and conditions; maintaining serial-tracked davit configuration database; alerting Coast Guard and disseminating advisories and service bulletins related to the davit systems and developing failure solutions for the davits.

Welin Lambie has submitted in writing that they are the sole provider with no authorized distributors that can provide OEM parts or OEM support. Welin Lambie is the sole design authority and the OEM of the Dual Point Davit and its component parts. They do not have any authorized dealers, distributors, or repair facilities, making them the sole source for maintenance parts kits; overhaul parts kits; spare parts for inventory; overhauls of existing davits and technical support as well as the only source with unlimited access to proprietary

OEM drawings, specifications, manuals, special tooling, software/hardware updates, and other technical data needed to manufacture, overhaul, upgrade and support the davits.

The dual point davits were originally purchased using full and open competition under

Contract Number DTCG40-00-D-50030, awarded September 21, 2000. Welin Lambie’s proposal was determined to be superior, because it exceeded several technical requirements and provided the best value, resulting in the installation of the Welin Lambie Davit System on all 210’s, 270’s and 378 cutters’. Data Rights were not purchased with the dual point davits.

Currently, only Welin Lambie Dual Point Davits, maintenance parts kits; overhaul parts kits;

spare parts for inventory; overhauls of existing davits and technical support ensure that the

Coast Guard does not expend a duplication of efforts and funding for logistics, engineering, travel, training, and maintenance already expended during the prototyping and installation of the original davit to include modifications and upgrades.

Utilizing the Welin Lambie davit system has also provided consistency, added reliability, and standardization across the fleet, and rapid response to the needs of the Coast Guard.

Market research efforts (conducted between March 2016 through March 2017) included contacting Welin Lambie regarding their stance on the sale of their proprietary data rights to the Coast Guard. In a letter dated June 26, 2017, Welin Lambie confirmed that the proprietary data was not for sale and would not be in the future. As Welin Lambie will not disclose their drawings, specifications and proprietary rights to the Coast Guard or any aftermarket manufacturer, in house maintenance is limited and all required overhaul parts, davits and technical support must be provided by Welin Lambie.

Use of OEM parts are necessary to ensure the parts are manufactured in accordance with

OEM specifications and standards, conform to original form, fit and function, and are compatible and interchangeable with existing components.

As previously referenced in Section (2) above the Coast Guard is in the process of performing the Maintenance Midlife Availability (MMA) upgrades for all WLB to be outfitted with the updated Model TW.PIV 5.0B davits to satisfy configuration management requirements across all platforms utilizing the Welin Lambie Davit systems.

Beyond Commandant Instruction M4130.6B requirements, life cycle sustainment and logistical support must also be considered. The inability to retrofit all Welin Lambie Davits currently in use, provide logistical support, develop and stock a new extensive inventory to support non-Welin Lambie davit systems, and re-engineering the supply Allowable Parts

Lists (APL’s) for any new configuration would be economically prohibitive. The cost of depleting and/or disposing of current supply inventory is another factor negating the economic viability of acquiring new davits from another source of supply.

The statutory authority permitting other than full and open competition is 10

U.S.C. 2304(c)(1) as implemented by the FAR Subpart 6.302-1 Only One

Responsible Source and No Other Supplies or Services Will Satisfy Agency

Requirements.

(6) Description of efforts made to ensure that offers are solicited from as many potential sources as practicable.

A sources sought notice was posted on February 14, 2017 to the Federal Business

Opportunity (FedBizOpps) website with submissions required by February 27, 2017. The only response received was from Welin Lambie. A presolicitation notice was also posted to

FedBizOpps on March 17, 2017. To date there have been no inquiries. An Acquisition

Planning Forecast (APFS) record was posted to the APFS website on March 22, 2017 with no inquiries.

The presolicitation notice stated that all responsible sources may submit a proposal or capability statement which shall be considered by the agency. The solicitation will be posted on the Federal Business Opportunities (FedBizOpps) website. Should a proposal be received from an offeror other than Welin Lambie Limited with evidence of having

OEM authorization to sell Welin Lambie manufactured parts, the proposal will be considered. However, based on the information provided by the OEM it is not anticipated any sources other than Welin Lambie will respond to the solicitation.

(7) Determination by the Contracting Officer that the anticipated cost to the government will be fair and reasonable.

The Contracting Office will determine that the anticipated prices to be fair and reasonable based on price analysis in accordance with FAR Subpart 15.404-1(b), utilizing a combination of price analysis techniques to include: comparison of proposed prices to historical prices paid (FAR 15.404-1 (b)(2)(ii), current catalog prices (FAR 15.404-1

(b)(22)(iv)), and an analysis of other than certified cost and pricing data (FAR 15.404-1

(b)(2)(vii)).

(8) Description of market research.

This is a sole source requirement to the OEM, Welin Lambie Limited. The company is located in Great Britain. As a foreign company Welin Lambie is considered a large business. A sources sought notice was posted on February 14, 2017, the only response received was from Welin Lambie. A presolicitation notice was posted on March 17, 2017. To date there have been no inquiries. An APFS record was posted on March 22, 2017 with no inquiries.

Welin Lambie Dual Point Davits, parts and services ensure that the Coast Guard does not expend a duplication of efforts and funding for logistics, engineering, travel, training and maintenance already expended during the prototyping and installation of the original davit system. There are risks associated with using other than OEM parts and OEM Technical

Representatives. Those risks include but are not limited to, the parts may not interface with the current davits or services that are not performed by an OEM representative who has access to proprietary technical data including, but not limited to, drawings, maintenance manuals, build specifications, and hardware/software updates include possible casualty of the davit, damage/loss of the small boats, catastrophic damage to the ship, endangerment of the ship’s crew, loss of mission execution capabilities and a detrimental compromise of cutter preparedness. Using alternative parts can also cause delays in the davit overhauls, causing the cutters to lose valuable patrol time having a subsequent effect on the patrol dates of other cutters.

(9) Any other facts supporting the use of Other than Full and Open Competition.

Welin Lambie Ltd. will not disclose their drawings, specifications, and proprietary rights.

The Coast Guard does not possess technical data that would provide for competition for this requirement. Consideration of any other manufactured component or outside service representatives would not be cost effective, because it would require additional funds to redesign and re-engineer the entire davit system and replace all primary components. The

Coast Guard also does not currently possess the required technical knowledge to fully support these davits or the test stand, special tooling and access to software updates required to overhaul them.

(10) A listing of the sources, if any, which expressed in writing, an interest in the acquisition.

A sources sought notice was issued in FedBizOpps on February 14, 2017 requesting parties to express their interest in writing to the contracting office. Only Welin Lambie responded.

(11) A statement of the actions, if any, the agency may take to remove or overcome any barriers to competition before any subsequent acquisition for the required supplies or services.

Welin Lambie has submitted in writing that they are the sole provider with no authorized distributors that can provide OEM parts or OEM support.

The Coast Guard requested pricing in 2010 for the purchase of the data rights associated with the Welin Lambie 5.0B Dual Point Davits. The total cost to purchase the rights, including but not limited to: the davit design, proprietary data and lost revenue to Welin

Lambie, was $9,644,555.00 and the offer was only valid for 30 days. The Coast Guard did not purchase the proprietary data rights to the manufacturer’s drawings, specifications or overhaul manuals at that time and has been unable to acquire these rights since the original procurement of the davits. Fiscal Year budget constraints do not allow the Coast Guard to purchase these rights, and doing so is not anticipated to produce a comparable value to the

Coast Guard on future acquisitions. The cost of the data rights is not expected to be recovered through competition. Therefore, the Coast Guard is unable to provide the complete manufacturing and servicing specifications for these davits to solicit full and open competition.

The U. S. Coast Guard has invested significant resources to the procurement of parts, part inventory supply, new davit procurements, and OEM training and support of the Welin

Lambie Davit System over the last two decades. The equipment is safe and reliable while providing the equipped cutters with the most effective option for small boat deployment currently available on the commercial market.