Attachment_5_Justification_for_Other_Than_Full_and_Open_Competition-Brand_Name_redacted.pdf

JUSTIFICATION FOR OTHER THAN FULL AND OPEN COMPETITION

UNDER 41 U.S.C. 1901

Only One Responsible Source and No Other Supplies or Services Will Satisfy Agency

Requirements

Solicitation Number: 70Z08518Q31847B00

Pursuant to the authority of 41 U.S.C. 1901 as implemented by Federal Acquisition Regulation

(FAR) Subpart 13.501 and consistent with the content 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 6.303-1 as follows:

1. Agency and Contracting Activity: The Department of Homeland Security, United States

Coast Guard (USCG), Surface Forces Logistics Center (SFLC), Long Range Enforcement

Product Line (LRE PL), located at 2401 Hawkins Point Road, Baltimore, MD, 21226 proposes to enter into a one-time contract, on a basis of other than full and open competition.

2. Nature/Description of the Action: The USCG has a new requirement on a Brand-Name basis to purchase three (3) Syntron ‘Face Type’ Propulsion Shaft Seal Assemblies, P/N D144003 which will complete a “Ship Set” in support of the 400’ WAGB CGC POLAR STAR. The period of performance will be 09/20/2018 to 03/20/2019 with an estimated cost of _______. The

USCG/SFLC anticipates a firm fixed price purchase order will be awarded in accordance with the procedures set forth in FAR Parts 12, Acquisition of Commercial Items, and FAR Parts 13.5, Simplified Procedures for Certain Commercial Items. Funding has been provided through using

AFC 45 Operations and Maintenance (O&M) funds.

2. Description of Supplies/Services: The requirement is for the supply of one (1) ship set which contains three (3) each seals, Syntron ‘Face Type’ Propulsion Shaft Seal Assemblies, Part

Number: D144003 for the 400’ WAGB in support of the CGC POLAS STARs drydock scheduled for ___________. The propulsion shaft seals must be manufactured in accordance with the OEM specifications and standards to ensure conformance to original form, fit and function, and be compatible and interchangeable with existing equipment.

The name and address of the Original Equipment Manufacturer (OEM) is:

Syntron Material Handling, LLC.

2730 Highway 145 S.

Saltillo, MS 38866-6814

SYNTRON Division of FMC Corporation, was the original equipment manufacturer (OEM) of the required item, Part Number D144003. In 2014 FMC Technologies, Inc. a subsidiary of FMC

Corporation, divested its material handling products business to Syntron Material Handling, LLC. During this transaction Syntron Material Handling LLC acquired the proprietary data rights to the Syntron Shaft Seals and is now considered the OEM for Syntron Shaft Seals.

Syntron Material Handling does not have any authorized distributors or service centers, but will sell their Syntron Seal Assemblies and repair parts to any interested parties and they willing provided a list of vendors who they routinely distributor their products through.

Solicitation #70Z08518Q31847B00

The parts and assemblies will be stored at the SFLC warehouse and will be ready for issue to the fleet when required.

The total estimated value of this acquisition is ___________.

Syntron Material Handling IGE For CGC POLAR STAR Propulsion Shaft Seal

NSN/Name QTY/

U/I

Unit Cost Total Contract Value

2040-01-380-3308 / Seal Assy, Shaft

Syntron "Face-Type" Shaft Seal Assembly, Each

Note: Escalation of 6% was utilized for the ordering periods based on historical data of the past contract and BOL CPI

4. Identification of Statutory Authority: The statutory authority permitting other than full and open competition is 41 U.S.C 1901 implemented by FAR Subpart 6.302-1 entitled “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:

This acquisition must be made using genuine OEM parts and assemblies to ensure form, fit and function of existing equipment. The use of non-Brand Name parts not manufactured in accordance with OEM specifications, materials, tolerances, etc. could cause equipment failure to the propulsion system, rendering the USCG unable to complete mission requirements and possibly place the crew in a hazardous environment causing injury or death. The actual equivalency of any non-OEM parts is not known, may not be easily determined, and the risk of accepting those types of parts without fully vetting their equivalence is unacceptable and may result in excessive cost to the Government, reduced reliability, reduced safety, and may hamper the Coast Guard mission requirements. The use of OEM Brand Name parts will ensure components and processes are sufficient to enable physical and functional interchangeability, as well as identifying source, size, configuration, and performance requirements.

The OEM is the only known source that possesses the required capabilities, drawings, specifications, engineering control procedures and proprietary methods to ensure the latest design configuration, manufacturing and quality control required to produce parts to the latest engineering specifications and requirements. The OEM does not restrict purchasing through their company and make these items available to other vendors to distribute.

Utilizing parts and seal kits other than Brand Name would require the Coast Guard to conduct product verification, operational testing, procure appropriate supply to support the fleet in addition to eliminating the existing inventory which would not be economically feasible. The need to maintain a consistency of parts thought out the Fleet is essential to standardization across the fleet.

Contracting an outside source to perform an equivalency evaluations on all the required parts would be cost prohibitive due to the sheer number and complexity of the various parts and assemblies that are included with the propulsion shaft and rudder seals and associated parts. In addition the USCG does not have access to the necessary data to provide to conduct the evaluation. Allowing non-OEM vendors to qualify their own assemblies would still require an equivalency verification.

Any attempt to manufacture these parts without the proper specifications, drawings and technical data and electing to use non-OEM parts (Brand Name) could result in equipment failures, shipboard flooding, and loss of cutter mobility. This would cause significant and severe impact the operations, capability and maneuverability of the affected USCG vessel(s) and safety of the crews.

6. Description of efforts made to ensure that offers are solicited from as many potential sources as is practicable Pursuant to FAR Subpart 5.2, in an effort to promote competition, a

Sources Sought Notice was posted on the Federal Business Opportunities (FBO) Website on 02

April 2018. This notice provided companies having the expertise and required knowledge for this work were invited to submit information discussing such capabilities to provide the required items. Two replies were received. Government market research has concluded that these items are manufactured by the OEM and available from several distributors. The Acquisition Planning

System Forecast record F2018041325 was published on January April 2, 2018.

7. 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 of proposed prices received in response to the solicitation in addition to the Independent Government Estimate. 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.

8. Description of Market Research: Market research was conducted from August 2017 to

June 2018. Market research included a review of acquisition history, commercial and government databases (Fed Log, Inventory Locator Service research tools, internet research and

FedBizOpps). A Sources Sought Notice was posted on Fedbizopps on 03/29/2018 with a response due date by 05/14/2018. In addition, distributors were contacted via telephone to search for any authorized distributors/service providers for Syntron Material Handling

Propulsion Shaft Seal systems utilized by the USCG Arctic Glacier Breaking Cutters. Market research confirmed that Syntron Material Handling LLC does not have any authorized distributors or certified service centers for Syntron ‘Face Type’ Shaft Seals, however they will sell the manufactured Syntron shaft seal items/assemblies to any interested parties.

Acquisition History: Previous contract _________________, for the purchase of Syntron ‘Face

Type’ Shaft Seals Assemblies was awarded on a sole source basis. There is no other acquisition on procuring these Syntron ‘Face Type’ Shaft Seal Assemblies.

The Contract Specialist emailed the OEM, on 19 June 2018 and requested the release of the data rights. OEM verbally indicated that they do not have authorized distributors and declined to release the data rights to the USCG. All technical data is proprietary to the OEM and is unavailable to allow the Government to evaluate alternate parts.

9. Any Other Facts Supporting the Sole Source Action: Syntron retains all rights to the seal configuration and designs. The seal designs and supporting parts are proprietary to Syntron and have never been sold or transferred. Should another manufacturer’s shaft seals be utilized, extensive modifications to the propulsion system may be required. These modifications would not only be prohibitively expensive but would compromise the commonality and configuration of the multiple vessel platforms. These items are not off the shelf and have been designed exclusively for the Coast Guard. Without adequate data, the Coast Guard is not capable of evaluating equal or alternate parts, or to determine equal testing criteria.

Using inferior non-tested or non-approved parts can affect tolerance, strength and material compatibility. Having Brand Name OEM parts is crucial in preventing catastrophic failure of the equipment which could result in personnel injury and loss of mission capabilities. The Coast

Guard does not possess any manufacturing data for these parts, components or equipment that would facilitate the procurement of compatible parts from other than the OEM.

Further, the scope of manufacturing, special processes, special tools and equipment required to manufacture the various parts, components and equipment is unknown. The use of only Brand

Name OEM parts will ensure that components and processes are sufficient to enable physical and functional interchangeability, as well as ensuring proper source size, configuration, mating and attachment characteristics, functional characteristics, and performance requirements that are essential in the planning and execution of missions.

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

A synopsis was issued in FedBizOpps on 03/29/2018 with a close date of 05/14/2018, requesting that parties express their interest in writing to the contracting officer. As a result, two companies responded the sources sought notice. Wärtsilä Defense Inc. and Coastal Seal Services Co.

Wärtsilä stated they would be interested in providing a new shaft seal system for POLAR STAR but did not indicate they would or could provide Syntron Shaft Seals. Coastal Seal Services stated they would also be interested in providing a new shaft seal system, however they also indicated that they would provide quotations for replacement Syntron Shaft Seal assemblies upon contract solicitation. Research has confirmed that neither Wärtsilä Defense nor Coastal Seal

Services have access to the proprietary data for Syntron Shaft Seal systems. Based on responses received and information obtained from the OEM, Brand Name seals can be provided by multiple vendors.

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 supplies or services required:

The need for the Syntron seal will continue to be an on-going need for the USCG. As stated previously, an attempt was made by the USCG to acquire the proprietary data from the OEM and the request was denied. Fortunately, Syntron will sell this product to other interested third party vendors which will promote competition. Although the Coast Guard does not currently own the required drawings, specifications, etc., to evaluate other than Brand Name OEM parts, the

Government will continue to make all attempts to obtain this data for future acquisitions.

SIGNATURE PAGE

1. 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.

Contracting Officer Date

2. 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 complete and accurate.

Contracting Officer’s Representative Date

3. LEGAL REVIEW:

USCG, Procurement Law Attorney Date

4. APPROVED BY:

SFLC, Branch Chief of Contracts & Procurement Branch 2 Date