70Z08023WMSL418JA_Redacted.pdf

JUSTIFICATION FOR OTHER THAN FULL AND OPEN COMPETITION

41 u.s.c. § 1901

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), Contracting and Procurement Division (CPD), Branch 1 in support of Long Range Enforcer Product Line (LREPL) 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 sole source basis.

(b) Name and address of the contractor:

Rolls Royce Solutions America Inc. (RRSA) (formerly MTU America, Inc (MTU)), 39525 Mackenzie Drive, Novi, MI 48377-1602

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

(d) Estimated total value (including options):

CLIN Item Description

USCG Hamilton Main Propulsion Diesel Engine, 01 Crankshaft Renew Option, USCG Waesche Main Propulsion Diesel Engine, 02 Crankshaft, Renew Total

(e) Type of funding: Operations and Support funds

(f) Year of funding: Fiscal Year 2023

(g) Solicitation number: 70Z08023QPBPL0006

Total

$3 311 752.40

$3,503,566.00 $6,815,318.40

(h) Background information about the requirement: Coast Guard Cutter (CGC) HAMILTON and CGC WAESCHE have suffered similar catastrophic failure to one of their Main Propulsion Diesel Engine (MPDE) crankshafts while conducting operations, in December 2022 and January 2023, respectively. Both failed engines are out of commission (OOC) until repairs can be completed, significantly degrading those cutters' ability to conduct operations.

3. Description of Supplies/Services.

This action will address replacement of the failed crankshafts on CGC HAMIL TON and CGC WAESCHE #2 and #1 Main Propulsion Diesel Engines (MPDEs), respectively, in place at each cutter's home port.

Period of Performance: 21 April 2023 thru 21 April 2024 or 12 months beginning on the date of contract award, whichever occurs soonest.

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

Competition.

The statutory authority permitting other than full and open competition is 41 U.S.C 1901 as implemented by FAR 13.5, Simplified Procedures for Certain Commercial Items.

5. Identification of Exception to the Buy American Act.

No exceptions to the Buy American Act listed under FAR 25.103(b) or FAR 25.202(a)(2) have been identified.

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

RRSA is the original equipment manufacturer (OEM) and integrator (01) of the National Security Cutter's (WMSL) diesel engine system. RRSA is both the OEM of the main engines and the 01 of the engine connections to the support generators, and they are the integrator for the connection of both Main Propulsion Diesel engines to the controls for the controllable pitch propellers. The MTU 20V, 20-cylinder, 9,730 horsepower engines were purchased for all the WMSL's from RRSA and, at the time, USCG SFLC did not acquire the related drawings and data supporting the engine and its design that integrated them into the propulsion system. The engine parts have very tight tolerances and the correct assembly procedures are critical to the performance of the engines. There are no other firms that possess the manufacturer drawings, specifications, and other technical data that include the updates and technical bulletins which are pertinent to the maintenance of the MPDEs. In an effort to maximize competition, on 02 February 2023, the USCG asked a representative from RRSA whether they would be willing to release proprietary data. RRSA responded by indicating that they and their parent companies were unwilling to release any manufacturing drawings, specifications, or other technical data related to the maintenance of the MPDEs.

This proprietary data would be required in order to open competition for these services to any other vendor, because attempting to perform maintenance and inspection services without access to this technical data, which includes performance tolerances/characteristics/parameters, would create a significant increased risk of engine failure. Therefore, due to proprietary data and processes, RRSA is the only available source to meet the needs of this requirement.

If a third-party vendor were to perform the repairs without access to the OEM proprietary data, chances of an engine failure in open waters is significantly increased. If the MPDEs were to fail while on patrol in open water and propulsion systems were to fail, not only would the congressionally mandated operational schedule be placed at risk due to delays associated with the repair, but also the crew could be placed in harm's way awaiting that repair.

Since CGC HAMILTON and CGC WAESCHE's MPDEs have failed, the following mission capabilities are at risk:

- Search and Rescue: This is the most common and visible mission of the United States Coast Guard. Since these missions deal with life and death, the MPDE must meet an exceptionally high standard for reliability and performance.

- Counter Narcotics Operations: When intelligence is received or a target is located, the MPDEs will be ramped up, so the cutter can respond as fast as possible.

- Fisheries Enforcement: These are endurance operations that require the MPDEs to either be sprinting to the next fishing fleet, or be in standby, while the cutter station-keeps alongside a fishing vessel with a boarding team onboard. Fisheries Enforcement patrols will require the MPDEs to be constantly engaged with predictable performance.

- Defense Operations: Defense Operations are extremely high tempo with an exceptionally slim margin for error. While in a precarious situation, halting the MPDEs for even short periods to correct minor casualties is unacceptable. They must be performing at their peak.

Delays due to these engine failures will result in schedule impacts that could significantly reduce the ability of these two WMSLs to support US interests around the globe.

7. Description of Efforts Made to Ensure that Offers are Solicited from as Many

Potential Sources as is Practicable.

This procurement is posted within the DHS Acquisition Planning Forecast System (APFS) under No. F2023061261 at http://apfs.dhs.gov and no inquiries have been made to date. A notice of intent to sole source was posted 7 February 2023 and no responses were received.

8. Determination by the Contracting Officer that the Anticipated Cost to the

Government will be Fair and Reasonable.

The Contracting Officer anticipates that the price will be fair and reasonable price based on a price analysis comparison with the Independent Government Estimate and extensive acquisition history with RRSA and other methods in accordance with FAR 13.106-3(a)(2) such as a comparison of the proposed price to similar items in related industries or prices found reasonable on previous purchases. Additionally, in accordance with DHS policy, the offeror may be required to submit Data Other than Certified Cost or pricing Data (FAR 15.403-3) to support price negotiations.

http://apfs.dhs.gov/

9. Description of Market Research.

Market research was conducted on 20 January 2023. Market research included a review of acquisition history, commercial and government databases (Fed Log, Inventory Locator Service research tools and internet research). RRSA shared their qualifications with the program representative and stated that they would not sell engine propriety data to third-party companies.

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.

RRSA provided at letter on 2 February 2023 stating they have the capability, tooling, parts, and expertise to perform all required Main Diesel Engine (MDE) maintenance. The letter also stated that between RRSA and their parent company(ies), Rolls Royce Power Systems/MTU Friedrichshafen, have the service capability of performing up to a QL4 maintenance level on the 20Vl 163TB93L engines currently installed in the U.S. Coast Guard's National Security Cutters (NSC) and that RRSA is the sole certified repair company in the United States for the MTU 20Vl 163 engine series. The letter also stated RRSA has no intentions of offering distribution or dealership rights to any third-party outside of their company(ies).

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.

Since RRSA continues to retain proprietary ownership of the technical data necessary for performing the required repairs on the CGC HAMILTON and CGC WAESCHE MPDEs and has declined to release the data to the Coast Guard, the Coast Guard anticipates that it may be difficult to obtain competition in future procurements. However, the Coast Guard will continue to advertise future requirements through SAM.gov and APFS and continue to seek access to the technical data sufficient to enable competition.

UYRE . HAUN.I SQUYRES.SHAUNIAN. JR.14728

EYLER MATTHEW

(CPAC

13. Contracting Officer's Certification.

I certify that the data supporting the recommended use of other than full and open competition is accurate and complete to the best of my knowledge and belief.

Q S S Digitally signed by

Shaun I Squyres, Jr.

Contracting Officer CPD 1 MEC Section Chief

Date

14. Technical/Requirements Personnel Certification.

I certify that this requirement meets the Government's minimum need and that the supporting data, which forms a basis for the justification, is accurate and complete.

Digitally signed by

Matthew Eyler Technical Representative/COR LRE Product Line

RECOMMENDED FOR APPROVAL

Digitally signed by

SAYOC • JONATHA SAYOC.JONATHAN.JUN.104781

Jonathan J Sayoc Supervisory Level Above the Contracting Offi Branch Chief

APPROVAL

FRANK.EDWARD.SH

Digitally signed by FRANK.EDWARD.

SHANNON.1025

167348 Date: 2023.02.13 11:20:17 -05'00'

Edward S. Frank- CG-912, DOL-9, SFL Command Procuring Activity Competition Advocate

A) cer CPD

ANNON.102516734