Final_JA_Redacted_HC108418F0089_Redacted.pdf

JUSTIFICATION & APPROVAL (J&A) FOR FEDERAL ACQUISITION

REGULATION (FAR) SUBPART 16.5 ACQUISITIONS

EXCEPTION TO FAIR OPPORTUNITY

Multiple Award Schedule/Multiple Award Contract (MAC)

Orders under MAC/ Fair Opportunity – FAR 16.505, Department of Defense FAR Supplement (DFARS) 216.505-70, Procedures, Guidance and Information (PGI) 216.505-70

Purchase Request Numbers: 11192053/11207041 Contract Number: NNG15SC08B Task/Delivery Order Number: To be determined Procurement Title: Installation Kits (IKs) Estimated Value:

Authority: FAR 16.505(b)(2)(i)(A)

JUSTIFICATION FOR AN EXCEPTION TO FAIR OPPORTUNITY

Justification for OTFAOC Number:

Upon the basis of the following justification, I, as the Procuring Activity Competition Advocate, hereby approve this exception to fair opportunity pursuant to the authority of FAR 16.505(b)(2)(i)(A), the agency need for the supplies or services is so urgent that providing a fair opportunity would result in unacceptable delays.

1. REQUIRING AGENCY AND CONTRACTING OFFICE:

Requesting Agency:

United States (U.S.) Army, Program Executive Office Command, Control, and Communications-Tactical (PEO C3T) Project Manager, Mission Command (PM MC) 6007 Combat Drive Aberdeen Proving Ground, Maryland 21005-1848

Contracting Activity:

Defense Information Systems Agency/Defense Information Technology Contracting Organization (DISA/DITCO/PL8322) 2300 East Drive, Building 3600 Scott Air Force Base, Illinois 62225-5406

2. NATURE/DESCRIPTION OF ACTION(S):

This procurement will be a firm fixed price delivery order, utilizing the National Aeronautics and Space Administration (NASA) Solutions for Enterprise-wide Procurement (SEWP) V Government-wide acquisition contract vehicle.

Fiscal year (FY) 2018 Army procurement funds have been provided on Military Interdepartmental Purchase Request numbers 11192053 and 11207041.

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3. DESCRIPTION OF SUPPLIES/SERVICES:

The PM MC, Product Manager Joint Battle Command – Platform (JBC-P) program is a networked battle command information system that enables units to share near real-time friendly and enemy situational awareness (SA) information, operational maps and graphics, and command and control messages. IKs provide the means through which JBC-P products/systems are installed into their target vehicular platform(s). IKs are comprised of mounting hardware, brackets, cables, and other ancillary hardware; they supply the electrical and mechanical interface between the vehicle platform and JBC-P products. There are currently over one hundred IK configurations; this procurement is for the 10 IK configurations experiencing the most critical shortage. Delivery of the IKs will commence five months from date of award. The total estimated life-cycle value is .

4. SUPPORTING RATIONALE, INCLUDING A DEMONSTRATION THAT THE

PROPOSED CONTRACTOR’S UNIQUE QUALIFICATIONS OR THE NATURE OF THE

ACQUISITION REQUIRES USE OF AN EXCEPTION TO FAIR OPPORTUNITY:

(a) Exception to Fair Opportunity. FAR 16.505(b)(2)(i)(A) The agency need for the supplies or services is so urgent that providing a fair opportunity would result in unacceptable delays (primarily due to the lead time associated with qualifying another supplier).

(b) Description of the Justification.

(1) DRS Network & Imaging Systems (DRS) was the original manufacturer of the subject IKs under contract W15P7T11DC601, which was awarded on 28 September 2011 and expired on 27 June 2015. During contract performance, DRS designed, modified, and manufactured IKs for the U.S.

Army, and provided drawings of the IKs to the Government. Bridge contract HC102816D0008 for IKs was awarded to DRS on 30 June 2016 for a 9-month period, and expired in March 2017. This contract was issued to mitigate shortages in inventory that were incurred while the follow-on procurement was prepared.

On 19 December 2016, HC102817D0002, an indefinite delivery/indefinite quantity (ID/IQ) contract for the procurement of IKs (including subject kits) and spares, was awarded on lowest price technically acceptable basis as a total small business set-aside (SBSA) to Ace Electronics Defense Systems, Inc (Ace). The contract has a base period of three years and seven option years, expiring 26 March 2027, and a ceiling of $99.4M.

Twelve delivery orders have been issued against the basic contract thus far with a combined total of $51M, halfway to the contract ceiling.

Ace continues to run their production lines at full capacity but does not have the production capabilities to accommodate the continuing high demand for installation kits to meet fielding needs. Execution of additional delivery orders against the current ID/IQ contract .

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All of the IKs require first article qualification testing (FAQT). As such, a company that has not designed and manufactured IKs previously would have to pass FAQT, which adds another two months to the timeline. The aforementioned contracts required that all IKs ordered be delivered within five months of order with exception of each respective IK’s initial order, wherein an initial delivery of seven months was granted to account for FAQT. For the 10 IKs for this current requirement, DRS is the only company that has passed FAQT, designed and manufactured kits, and has available capacity. Ace has passed FAQT, designed and manufactured one of the 10 required IKs. As a result, DRS is the only company that will be able to meet the five-month timeline, because it does not need to go through the FAQT for the 10 IKs.

(c) Justification.

(1) Minimum Government requirements. At a minimum, the Government requires 10 “build-to-print” IK configurations that align to Government-owned drawing packages in order to facilitate the proper installation of JBC-P products into their target vehicular platform. All 10 IK configurations need to also have undergone successful FAQT and acceptance by the Government before they can be fielded. The required delivery time for the Army’s current requirement is five months from delivery order award.

(2) Proposed sole source contractor. DRS is the proposed source for this sole source contract action, as they are the only available source that has manufactured and successfully passed FAQT for all 10 IK configurations.

DRS has confirmed that they have the capacity available to meet the required delivery schedule.

(3) Discussion regarding cause of the sole source situation. Re-competing the IKs is not feasible due to the length of time such an action would take: 8 to 12 months minimum to compete the solicitation process and 7 months for FAQT and initial delivery that would be required of any contractor except DRS. Thus, no other approach could satisfy the required delivery date.

(4) Demonstration of unique source. DRS is the only source able to produce

IKs by the required delivery date based on its proven ability to manufacture the subject IKs under contracts W15P7T11DC601 and HC102816D0008.

The IKs produced by DRS would not need to undergo FAQT. DRS intends to dedicate their Melbourne, FL kitting line to this program and will quickly ramp up to meet the required delivery schedule. DRS can surge by staffing a second shift in Melbourne, and if requirements drive the need for higher surge, DRS can start a second kitting line in Huntsville, AL to duplicate the capability provided in Melbourne. This provides the Government a path for additional scalability as demand increases.

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(5) Procurement discussion. This contract action is constrained primarily by the need to procure IK configurations that have successfully undergone FAQT and the current depletion of stock due to an influx of additional customer requirements and delays in current production of IKs. Due to high demand and complexity of IKs and spare parts, the contractor needs to run at a high capacity in order to maintain the required delivery schedule.

The current contract for

IKs is held by Ace, whose production capacity is unable to keep pace with the high demand for IKs. Other than DRS, no other manufacturer has successfully passed FAQT for all 10 IK configurations and has manufacturing capabilities available immediately. Additionally, DRS has confirmed that they have the capacity available to meet the required delivery schedule. As a result, DRS is the only company capable of meeting the five-month delivery time required by the Army to meet the ongoing fielding schedule.

(6) Impact. If this contract action is not approved, PM MC will be unable to address FY18 fielding and maintenance requirements due to a depletion in stock. The capability of deployed units would be affected, resulting in diminished warfighting capabilities. In addition, operation and sustainment costs are increased as older hardware is left in the field longer. Of these impacts, the most concerning to the Army is diminished warfighting capabilities of its deployed units. Many units slated to receive JBC-P products are operating on older and/or obsolete communication systems that have a number of known cyber-vulnerabilities.

5. COST/PRICE FAIR AND REASONABLE DETERMINATION: The Contracting Officer will make a determination as to whether the anticipated cost to the Government is fair and reasonable, based on comparison to the IGCE and historical pricing in relation to HC102816D0008. Rates have already been established with the basic NASA SEWP V Government-wide acquisition contract holders. All rates set forth in the contract and used on individual orders were determined fair and reasonable. Pursuant to DoD policy, the Contracting Officer will seek additional discounts prior to placing any order.

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6. MARKET RESEARCH: Market research conducted in April 2018 and May 2018 shows that the required hardware items are available through at least two sources, DRS and Ace. The required items are available via DRS on their NASA SEWP contract vehicles, NNG15SE05B and NNG15SC08B. The current IK contract, HC102817D0002, was awarded to Ace via a total SBSA. However, FAQT requirements preclude any other contractor, including Ace, from meeting the required delivery schedule.

7. ANY OTHER SUPPORTING FACTS: None.

8. ACTIONS THE AGENCY MAY TAKE TO REMOVE OR OVERCOME BARRIERS

THAT LED TO THE EXCEPTION TO FAIR OPPORTUNITY:

(a) Procurement History.

(1) HC102817D0002 was awarded as a total SBSA, single-award ID/IQ contract to Ace on 19 December 2016.

(2) HC102816D0008 was awarded as a sole source bridge ID/IQ contract to DRS on 30 June 2016.

(3) W157PT11DC601 was awarded via full and open competition as a single-award ID/IQ contract to DRS on 28 September 2011.

(b) The circumstance requiring the sole source award to DRS is the need to procure IK configurations that have successfully undergone FAQT in order to meet the required delivery schedule. When delivery and fielding of IKs has removed the backlog of urgent requirements, ordering from HC102817D0002 will resume. Additionally, PM MC is currently working on the re-compete solicitation for the follow-on to HC102817D0002

9. REFERENCE TO THE APPROVED ACQUISITION PLAN (AP): In accordance with the exceptions under DISA Acquisition Regulation Supplement 7.103 (S-91) (1) (vii), an AP is not required.