A10_Consolidation DF MRT MRL MATOC FY23 final.pdf

DEPARTMENT OF THE ARMY

U.S. ARMY CORPS OF ENGINEERS, VICKSBURG DISTRICT

DETERMINATION AND FINDINGS REQUEST FOR CONSOLIDATION

MULTIPLE AWARD TASK ORDER CONTRACT (MATOC) FOR MISSISSIPPI RIVER

LEVEES CONSTRUCTION

COORDINATION PAGE:

The following signatures indicate concurrence with the contents of this document.

Deputy for Small Business Program

District Counsel

APPROVAL

Davita S. Baloue Chief, Vicksburg District Contracting Office

DEPARTMENT OF THE ARMY

U.S. ARMY CORPS OF ENGINEERS, VICKSBURG DISTRICT

DETERMINATION AND FINDINGS REQUEST FOR CONSOLIDATION

MULTIPLE AWARD TASK ORDER CONTRACT (MATOC) FOR MISSISSIPPI RIVER

LEVEES CONSTRUCTION

FAR 2.101 defines consolidation or consolidated requirement as a solicitation for a single contract, a multiple-award contract, a task order, or a delivery order to satisfy— (i) Two or more requirements of the Federal agency for supplies or services that have been provided to or performed for the Federal agency under two or more separate contracts, each of which was lower in cost than the total cost of the contract for which offers are solicited; or (ii) Requirements of the Federal agency for construction projects to be performed at two or more discrete sites. FAR 7.107-2 requires that consolidation of requirements with an estimated total dollar value exceeding $2 million shall be supported by a written determination that consolidation is necessary and justified in accordance with 15 U.S.C. § 657q.

I have reviewed this requirement and associated market research and determined in accordance with 15 U.S.C. § 657q and FAR 7.107-2 that a consolidation of requirements under a Multiple Award Task Order Contract (MATOC) is both necessary and justified. The benefits of this consolidation substantially exceed the benefits of any alternative contracting approaches which have been identified and considered below. This approval is made in accordance with the approval thresholds set forth in Army Federal Acquisition Regulation Supplement (AFARS) 5107.107-2, “Consolidation of Contract Requirements” and U.S. Army Corps of Engineers Acquisition Instruction (UAI) 5107.107-2-100, “Consolidation.” My review resulted in the following findings:

FINDINGS

1. Introduction: The U.S. Army Corps of Engineers, Vicksburg District (MVK), plans to consolidate contract requirements to provide Mississippi River Levee (MRL) Construction in various locations along the Mississippi River to support the Mississippi River and Tributaries (MR&T) Program. To acquire these construction services, MVK will award MATOCs with a shared capacity of $99.5M to all qualifying offerors. These MATOCs will meet repair and construction mission requirements under North American Industry Classification System (NAICS) code 237990, Other Heavy and Civil Engineering Construction. These procurements constitute a consolidation of requirements per 15 U.S.C. § 657q(a)(2)(B) in that task orders issued under the proposed MATOC will involve construction at two or more discrete sites. MVK has conducted analysis and market research that demonstrates consolidation of requirements in this procurement is both necessary and justified.

2. Description of Procurement Action:

a. Project Description: Following the Great Mississippi River Flood of 1927, the nation rallied in its support for a comprehensive and unified system of public works within the lower Mississippi Valley that would provide enhanced protection from floods. MVK, the New Orleans

District (MVN), and the Memphis Division (MVM) are tasked with significant responsibilities under the MRL program and are currently responsible for constructing and maintaining over 1,098 miles of MRL. Under the MRL program, the Districts perform studies, investigations, designs, and construction of compacted, semi-compacted, and un-compacted embankments for levees and berms utilizing Government furnished riverside or landside borrow areas as well as installation of relief wells along the toe of the levee. Other mission requirements include clearing and grubbing, ditching, furnishing and installing culverts and cattle guards, construction of drainage structures in borrow areas, establishment of turf, and crushed stone or asphalt paving on the levee crown along the MRL within the geographic bounds of the Districts.

b. Acquisition Strategy/Procurement Summary: To rapidly respond to challenging and unknown requirements for MR&T MRL Construction, MVK intends issue a single solicitation and make multiple awards of indefinite delivery requirements contracts in accordance with FAR Part 16.503(b)(1), as the Government anticipates recurring requirements but cannot predetermine with precision the exact quantity, nor exact time period needed. MATOCs will be awarded in an amount not to exceed $99.5M combined for MRL construction projects within the bounds of MVK. Individual Construction Task Orders will be competed amongst the MATOC awardees.

MVK has determined that this procurement will be a 100% small business set-aside. The ordering period will not exceed five (5) years.

c. Applicability of Consolidation: Sec 1671 of the FY13 NDAA amended the definition of consolidation as set forth in Sec 44 of the Small Business Act, 15 U.S.C. § 657q. As implemented in FAR 2.101, “consolidation of contract requirements,” with respect to contract requirements of a Federal agency, means the use of a solicitation to obtain offers for a single contract or a multiple award contract to satisfy - (A) two or more requirements of the Federal agency for goods or services that have been provided to or performed for the Federal agency under two or more separate contracts lower in cost than the total cost of the contract for which the offers are solicited; or (B) requirements of the Federal agency for construction projects to be performed at 2 or more discrete sites. The definition applies to these procurements because task orders issued under the proposed MATOCs will be used to perform multiple construction projects, awarded on individual basis, at two or more discrete sites along the Mississippi River.

d. Requirements Being Consolidated: Under these MATOCs, MVK will consolidate multiple known and un-known MRL projects along the Mississippi River. The plans and specifications for each project will be detailed in each task order. The consolidated construction costs, which include regular and supplemental funded projects, is estimated at $99.5M over the next five years. The MR&T program is funded with 100% civil works appropriations. MVK depends on an acquisition program with maximum flexibility to allow expeditious execution which is adaptable to new and unexpected requirements. Although future project allocations are not known at this time, on average the MR&T regular program executes approximately $10M for MRL construction, annually.

e. Procurement History: MVK issued single solicitations for MATOCs, as total small business set-asides, in 2018 and again in 2019 resulting in multiple awards to small businesses. Contracts W912EE18D0003, W912EE18D0004, W912EE18D0005, W912EE18D0006 were awarded in response to the 2018 solicitation and had a combined capacity of $45M. Contracts

W912EE20D0007, W912EE20D0008, and W912EE20D0009 were awarded in response to the 2019 solicitation and have a combined capacity of $170M. Prior to 2018, MVK utilized consolidated stand-alone construction contracts for MRL construction work.

Table 1. Historical Construction Contract Awards

Year Contract Number/Contractor

Award Amount

Small Business (Yes/No)

2015 W912EE-15-C-0001

Harding Enterprises, LLC $6,759,316.00 Yes

2015 W912EE-15-C-0002

My Company, Inc. $2,109,700.80 Yes

2015 W912EE-15-C-0012

Carter’s Contracting Services $8,726,001.50 Yes

2016 W912EE-16-C-0002

Dirt Works, Inc. $7,640,844.00 Yes

2017 W912EE-17-C-0014

Tarpan Construction $4,757,000.00 Yes

2017 W912EE-17-C-0020

Kajacs Contractors, Inc. $5,450,000.00 Yes

Table 2. Historical MATOC Awards

Year

Contract Number/Contractor

Award Amount

Small Business

2018 W912EE18D0003

Affolter Contracting Company, Inc.

$45 Million Combined

Yes

2018 W912EE18D0004

B&K Construction Company, LLC.

$45 Million Combined

Yes

2018 W912EE18D0005

Circle, LLC

$45 Million Combined

Yes

2018 W912EE18D0006

Phylway Construction, LLC

$45 Million Combined

Yes

2020 W912EE20D0007

Phylway Construction, LLC

$170 Million Combined

Yes

2020 W912EE20D0008

Circle, LLC

$170 Million Combined

Yes

2020 W912EE20D0009

Affolter Contracting Company, Inc

$170 Million Combined

Yes

Table 3. Historical MRL Task Orders Awarded Against MRL MATOCs

Year

Task Order/Contractor

Current Award Amount

Small Business

2018 W912EE18F0116

Phylway Construction, LLC.

$6,233,876.05 Yes

2018 W912EE18F0166

Affolter Construction Company

$8,081,109.49 Yes

2018 W912EE18F0168

Phylway Construction, LLC.

$3,264,987.50 Yes

2019 W912EE19F0026

Phylway Construction, LLC.

$963,000.00 Yes

2019 W912EE19F0133

Circle, LLC.

$1,044,308.00 Yes

2019 W912EE19F0155

Phylway Construction, LLC.

$19,064,240.00 Yes

2020 W912EE20F0124

Phylway Construction, LLC.

$9,428,079.48 Yes

2021 W912EE21F0068

Phylway Construction, LLC.

$19,350,616.00 Yes

2021 W912EE21F0074

Circle, LLC.

$7,077,716.50 Yes

2022 W912EE22F0001

Affolter Construction Company, Inc.

$6,891,416.00 Yes

2022 W912EE22F0007

Affolter Construction Company, Inc.

$24,187,878.40 Yes

f. Rationale for Consolidation:

(1) In order to be determined necessary and justified, the benefits of the consolidated acquisition must substantially exceed the benefits that would be derived from alternative contracting approaches that involve less consolidation. Such benefits may include qualitative or quantifiable cost savings or price reductions as well as other benefits, regardless of whether quantifiable in dollar amounts, to include quality improvements that will save time or improve or enhance performance or efficiency, reduction in acquisition cycle time, better terms or conditions, or any other supportable benefit. Benefits that are quantifiable are considered substantial if they meet the dollar amounts set forth in FAR 7.107-2(d). For these procurements the estimated value is $99.5M combined. Pursuant to FAR 7.107-2(d)(1)(ii), for acquisitions in which the value exceeds $94 million, the quantitative benefits must be equivalent to “five percent of the estimated contract or order value (including options) or $9.4 million, whichever is greater.

Five percent of the estimated contract value is $4.975 million for each acquisition. Therefore, the quantitative financial benefits from consolidation for each acquisition must exceed $9.4M to qualify as substantial. Furthermore, under FAR 7.107-2(3) the reduction of administrative or personnel costs alone is not sufficient justification for consolidation, unless the cost savings are expected to be at least 10% of the estimated contract or order value. If the quantifiable benefits do not meet these thresholds, the approving authority may determine that consolidation is necessary and justified if critical to the agency’s mission success and the procurement strategy provides for maximum practicable participation by small business. Although some cost savings will be realized, this consolidated approach will not meet the required $9.4 million for each acquisition in cost savings to fully justify the consolidation. Therefore, in accordance with FAR 7.107-2(e)(1), in addition to estimated cost savings, the following rationale justifies the (i) criticality of this requirement to the agency’s mission success and (ii) that this recommendation provides maximum practicable participation by small business.

(2) If the quantifiable benefits do not meet the thresholds in FAR 7.107-2(d)(1)(i), the approving authority may determine that consolidation is necessary and justified if critical to the agency’s mission success and the procurement strategy provides for maximum practicable participation by small business. Soliciting the procurement as a Total Small Business Set-Aside ensures maximum participation by small business by restricting award to small business concerns.

Current market research and a historical review of similar acquisitions support a Total Small Business Set-Aside for this procurement.

(3) Consolidation of projects gives contractors an opportunity to execute projects more efficiently, which in turn boosts the USACE’s ability to complete its MRL construction mission successfully. When two or more projects are combined, the solicitation usually allows a longer performance period to give the contractor the option of performing the two projects in series or concurrently. This longer period gives the contractor flexibility in determining how the work is sequenced. This flexibility reduces the contractor’s risk of performance, which results in lower costs to the contractor and could consequently result in savings to the Government.

(4) Having the ability to utilize a shortened acquisition cycle and the flexibility to consolidate individual projects enhances the Government’s ability to meet customer needs efficiently, timely and at a lower overall cost without having any adverse impacts on the quality of the work. This approach also enables us to complete projects that would otherwise be potentially at risk of not being performed due to schedule constraints. When scheduling windows present a challenge to the completion of multiple projects in proximity by multiple contractors, consolidating the requirements enables one contractor to perform and schedule the work to meet the deadline.

Utilizing a MATOC, whereby task orders will be competed and awarded from within a pool of highly qualified, experienced contractors will generate favorable schedule and performance benefits. This method will substantially increase the probability that projects will be completed, in a timely manner and per contract specifications.

3. Applicable Statutes/Regulations: 15 U.S.C. § 657q, DFARS 207.170, and AFARS 5107.107.

4. Results of Market Research: Market research was conducted to determine those sources that could fulfill the Government’s requirement in accordance with FAR 10.002(b) (2). To ensure that small business concerns are given appropriate opportunities to participate as prime contractors and subcontractors in Federal procurements, MVK conducted market research that supplemented MVK’s knowledge of capabilities based on prior similar acquisitions. A review of the historical data of similar acquisitions since 2015 shows that six stand-alone construction contracts, seven indefinite delivery MATOCs, and eleven task orders issued under those MATOCs were awarded, all to small business concerns. As part of market research for the proposed MATOCs, a sources sought notice was published to www.sam.gov on 21 October 2022 http://www.sam.gov/ with a suspense date of 21 November 2022. Eighteen responses were received, seventeen from small businesses and one from a large business. A Quick Market Search using the parameters of NAICS Code 237990, the states Arkansas, Louisiana, and Mississippi, and the keywords “levee construction” produced results of five Woman-Owned Small Businesses, six HUBZone Certified Small Businesses, four Veteran-Owned Small Businesses, and two 8(a) Certified Small Businesses. A Dynamic Small Business Search using the same parameters returned six results.

The results of market research overwhelmingly support a Total Small-Business Set-Aside as there is a reasonable expectation that offers will be obtained from at least two small business concerns and award will be made at fair market prices in accordance with FAR 19.502-2(b).

5. Alternate Contracting Approaches Considered and Rationale for Rejection: MVK considered and rejected the alternative approach issuing stand-alone construction contracts for MRL construction requirements.

a. Time Savings. A complicating element of the construction and repairs under the MR&T program is the difficulty in estimating future year annual funding levels. While the program is anticipated to continue to receive substantial funding during the life of this procurement, it remains subject to significant annual fluctuations in funding, which directly impacts priorities within the program. MVK minimizes this uncertainty by using IDIQ acquisition actions to create capacity to accomplish the mission requirements and flexibility to respond to those requirements or funds that arrive on short notice.

Additionally, the work performed under the contract is often dictated by rapidly changing river levels that cannot be accurately predicted in advance.

(1) The use of task orders under a MATOC streamlines the procurement process and is significantly more expeditious than a stand-alone construction contract strategy. Historically, the required time from project start to contract award, Procurement Acquisition Lead Time (PALT), averages approximately 150 days and includes internal reviews (DQC, ATR, BCOES), procurement related activities, such as sources sought, market research, coordination with SBA, creating solicitation, legal review, and administrative activities necessary for soliciting/awarding the contract.

Having multiple projects under development at the same time for similar work would result in overlapping reviews, tie up labor resources, and decrease administrative efficiencies. In addition, the likelihood exists that the same MVK personnel would be working on multiple projects, increasing the time required from project start to contract award for the individual projects. In contrast, task orders under a MATOC do not require advance notice, voluminous solicitations and proposal submissions, or source selection boards for non-IFB solicitations.

(2) Stand-alone construction contracts are solicited as sealed bid invitation for bids, per FAR 36.103(a) and FAR 36.213-3, and have an average PALT of 90 days. MATOCs have a PALT of 120 days on average, task orders issued under a MATOC have a PALT of 45 days on average. A stand-alone construction contract requires that a pre-solicitation notice (synopsis) be posted at least 15 days before a solicitation is posted, per FAR 5.203(a), and a bidding period of at least 30 days is required when a synopsis is required, per FAR 14.202-1(a). Issuing a pre-solicitation notice is excepted for task orders issued from a MATOC in accordance with FAR 5.202(a)(11), as the requirement would have been previously synopsized just prior to the issuance of the solicitation for the MATOC, and the minimum 30-day bidding period is not required. Much of the reduction in PALT from issuing task orders is due to these exceptions.

(3) Historically, the funding for this work is prioritized as emergencies and is expected to be executed by fiscal year end. Unfortunately, requests for execution of such work is typically not received by MVK until the third and fourth quarters of the fiscal year, after the annual high river events. The late project priority determinations by customers and corresponding late delivery of funding necessitates that MVK utilize flexible and efficient procurement strategies. Although the funds received are “no year” funds, past MSC (MVD) practice is for the MVK to obligate the funds within the fiscal year received or risk the funds being reassigned to other projects. These externally imposed end-of-year procurement requirements are most successfully addressed by the streamlined acquisition procedures provided under FAR Part 16, where there is no requirement to advertise a project for 15 days, or to provide bidders 30 days to submit a proposal. Accordingly, if MVK is constrained to stand-alone construction contracts, any requirements that are presented in the fourth quarter would be at significant risk for award before funds cease to be available for obligation within the corresponding fiscal year.

(4) Most important, however, is the constraints of the stand-alone construction contract process on MVK’s ability to take advantage of available river stages in the award of these requirements.

Historically, the agency can only estimate river stages, or the depth of the water in the river, 60 days in advance. Given yearly fluctuations in the river level missing a favorable river stage can mean sometimes waiting a year or more for favorable river stages to return. When this happens the levee work which supports keeping the Mississippi River open as a critical national transportation route and which is critical to the agency’s mission success cannot be accomplished. Different windows for specific tasks occur concurrently throughout the lower river, necessitating the need to award concurrently and quickly on different contracts as they occur. Consolidation allows MVK to compete task orders that take maximum advantage of the available performance windows. The difference between a 45-day PALT for MATOC procurements and a 90-day PALT for stand-alone construction contracts is critical to the agency’s mission success since the MATOC PALT allows the agency to quickly respond during favorable river stages and accomplish mission critical levee work when it is needed. Thus, consolidation is in the government’s best interest due to the timing restrictions, anticipated rate of frequency of orders issued, and the ability of the government to schedule the work efficiently. As shown in Table 1 below, based on information provided by the Contracting Division, the total PALT time saved by awarding each MATOC with 10 task orders each year for 5 years vs 10 standalone “C” type contracts for each MATOC requirement for 5 years is 2,130 calendar days.

Table 4. Time Savings Comparison of In-House Contracting Process for Each MATOC with 10 task orders per MATOC vs. 10 Stand Alone Construction Contracts

BASE YEAR

MATOC w/ 10 TOs 10 "C" Contracts

MATOC RFP 120 10 IFBs (90d each) 900 10 TO (45d each) 450

TOTAL 570 TOTAL 900

BASE YEAR SAVINGS (days) 330

Each Additional Year

MATOC w/ 10 TOs 10 "C" Contracts 10 TO (45d each) 450 10 IFBs (90d each) 900 Each Year Savings 450 TOTAL 4yr SAVINGS (days) 1800

TOTAL SAVINGS - MATOC with 10 TO/yr

BASE YEAR 330

4yr SAVINGS 1800 TOTAL SAVINGS (days) 2130

b. Cost Saving. Per 15 U.S.C. § 657q(c)(2)(B), “savings in administrative or personnel costs alone do not constitute a sufficient justification for a consolidation of contract requirements” unless the total amount of the cost savings is expected to be substantial in relation to the total cost of the procurement. The consolidated MATOC approach maximizes the opportunity to procure high quality construction and at fair and reasonable prices from technically competent bidders.

(1) Administrative and procurement cost savings. Table 4 below compares the estimated administrative and personnel costs required for each consolidated MATOC vs separate "C" type contracts. These costs are based on standard regional labor costs developed by Contracting for FY18 procurements, along with historical average procurement support costs for Cost Engineering Division, Programs and Project Management Division (PPMD), and Engineering and Construction Division for acquisition coordination, document review, IGE development, site visit attendance, Source Selection Evaluation Board labor, and source-selection related preparation, travel, and administration. The average design and procurement costs provided for in-house labor required for the engineering and design, drafting, and review of a RFP, task order, or construction contract by engineering, cost engineering, and construction branch is approximately $150,000.

This in-house cost was derived from historic acquisitions for this type of work using the labor rates for the different disciplines mentioned above and the combined total costs associated for each activity required from project conception to award.

(2) Based on information provided by the Contracting Division, the total costs saved by awarding each MATOCs with 10 task orders each for 5 years vs 10 stand-alone construction contracts for 5 years is $1,120,000.

Table 5: Cost Savings Comparison of In-House Labor for each MATOC with 10 task orders per MATOC vs 10 Stand-Alone Construction Contracts

BASE YEAR

MATOC w/ 10 TOs 10 Construction Contracts

RFP $ 30,000.00 10 IFBs ($25K each) $ 250,000.00 10 TO ($5K each) $ 50,000.00 TO Closeout ($2K each) $ 20,000.00 ($5K each) $ 50,000.00 TOTAL Contracting $ 100,000.00 $ 300,000.00 Other In House Labor ($150k per TO) $ 1,500,000.00 ($150k each) $ 1,500,000.00

TOTAL $ 1,600,000.00 $ 1,800,000.00

BASE YEAR SAVINGS $ 200,000.00

Each Additional Year

2 MATOC w/ 10 TOs each 20 Construction Contracts 10 TO ($5K each) $ 50,000.00 20 IFBs ($25K each) $ 250,000.00 TO Closeout ($2K each) $ 20,000.00 ($5K each) $ 50,000.00 TOTAL Contracting $ 70,000.00 $ 300,000.00 Other In House Labor (150K each) $ 1,500,000.00 ($150k each) $ 1,500,000.00 TOTAL Each Year $ 1,570,000.00 $ 1,800,000.00 Each Year Savings $ 230,000.00 TOTAL 4yr SAVINGS $ 920,000.00

TOTAL SAVINGS – Per MATOC with 10 TO/yr

BASE YEAR $ 200,000.00

4yr SAVINGS $ 920,000.00

TOTAL SAVINGS $ 1,120,000.00

c. Schedule and Mission Savings

(1) Project Schedule. A MATOC will reduce the overall project schedule by several months compared to the individual schedules that would be required if each project were awarded separately or less consolidation was used. As stated in Part 5a.(2), the project schedules are reduced from an average 90-day PALT per project using a Construction contract to approximately 45 days for a MATOC task order. In addition to the overall time savings, consolidation facilitates MVK’s synchronizing overall operations for efficient coordination and collaboration when scheduling work and accommodates concurrent use of environmental time windows. The specific construction and maintenance work locations are expected to be located at various points along the Mississippi River in locations within the geographic boundaries of MVK. If these projects were awarded separately, the construction schedules for each project would have to be staggered to ensure enough qualified contractors are available to bid the solicitations. By consolidating the projects, the overall schedule will be minimized due to the efficiency of in-house labor being devoted to one contracting effort rather than having multiple teams working separately on individual river construction contracts.

(2) Successful, Timely Mission Completion. Having a MATOC in place, consisting of contractors who are technically capable of performing the work, MVK can reduce procurement acquisition lead time for each project. By utilizing MATOCs for these MRL program projects, there is a much lower risk of obligation and execution failure resulting in enhanced flood risk and failure to comply with the associated guidance. By having MATOCs in place consisting of contractors who are technically capable of performing the work MVK can significantly reduce the risk of delaying or preventing work from being accomplished due to mistakes in bid by inexperienced contractors, contract terminations and delays due to contractors failing to have financial and equipment capabilities necessary to handle concurrent projects, and protests; all which are detrimental to the agencies mission success as the agency is tasked with executing the MRL program.

d. Quality. The iterative process of working with experienced MATOC contractors tends to generate a more thorough shared understanding between the contractor and Government for the Government's requirements. While the potential exists for stand-alone construction contract holders to end up being poor performers, MATOCs allow for competition and selection to preclude subsequent award to poor producers, resulting in a “good to great” contractor being selected to perform every project.

e. Summary. In summary, the cost benefits of consolidation for each of these MRL requirements under each MATOC equates to $1,120,000 in savings versus the use of stand-alone construction contracts, which does not meet the cost savings required to meet the definition of substantial benefits in order to justify consolidation of requirements. However, this consolidation provides other substantial benefits through vital qualitative benefits that are critical to provide protection and flood risk reduction against the “greatest flood” (a USACE modeled catastrophic flood event) having a reasonable probability of occurrence. Combining these requirements in order to ensure a proper contracting vehicle is in place to allow reliable, experienced, skilled contractors to begin construction, as quickly as possible, is critical in allowing the Districts to provide expedited mission execution as directed by the Director of Civil Works and to quickly respond to changing river conditions. Consolidation is in the government’s best interest due to the timing restrictions, anticipated rate of frequency of orders issued, and the ability of the government to schedule the work effectively and efficiently. As mentioned previously, the total time saved by awarding each MATOC with 10 task orders each year for 5 years vs 10 stand-alone construction contracts each year for 5 years is 2,130 calendar days of PALT. The MATOC offers a critical, necessary step to deliver an aggressive, effective, and efficient MRL program and Drive Quality Project Delivery as directed by the Director of Civil Works.

6. Bundling Analysis:

a. Definition of Bundling. FAR 2.101 defines bundling as consolidating two or more requirements for supplies or services, previously provided or performed under separate smaller contracts, into a solicitation for a single contract that is likely to be unsuitable for award to a small business concern due to: (i) The diversity, size, or specialized nature of the elements of the performance specified; (ii) The aggregate dollar value of the anticipated award; (iii) The geographical dispersion of the contract performance sites: or (iv) Any combination of the factors described in paragraphs (i) through (iii) of this definition.

b. Definition of the Competition in Contracting Act (CICA) Bundling Principle: This acquisition does not meet the definition of bundling, as it does not attempt to consolidate “two or more requirements for supplies or services, previously provided or performed under separate smaller contracts that are likely to be unsuitable for award to a small business concern”. The requirements being consolidated have all been previously advertised as an Unrestricted IFB.

c. Applicability of CICA Bundling Principle: This principle, as developed by the Government Accountability Office (GAO) case law, focuses on whether the combined requirement (new, old, or otherwise) restricts competition, and whether the agency is consolidating or bundling a new requirement unnecessarily. In order to justify CICA Bundling the agency must show "a reasonable basis for why the bundling is necessary to meet the agency need." (Vantex Serv., Inc., B-29041 5, Aug 8, 2002 and Outdoor Venture Corp., B-299675; B-299676, Jul 19, 2007.)

Consolidation of requirements is necessary to allow MVK to meet the MRL construction needs of its customers in a cost effective and timely manner. Consolidating requirements under MATOC contracts enables the Government to gain many efficiencies and cost savings (see Rationalization of Consolidation section above) that result in a product that is delivered in a timely and efficient manner to our Federal and non-Federal sponsors without any adverse impact on competition or execution by SB concerns.

This procurement is intended to be a total small business set-aside MATOC. Bundled procurements combine separate requirements into one contract; thus, they have the potential to restrict competition in violation of CICA by excluding firms that can provide only a portion of the bundled requirement. However, substantial cost savings achieved through the reduction of duplicative efforts and operational efficiency can be a reasonable basis for restricting competition where requirements are bundled. As demonstrated above, substantial cost savings will be accomplished through consolidation of these requirements. These projects have been consolidated in the past into a MATOC procurement vehicle. Competition to small businesses is not restricted since the procurement will be listed as a total small business set-aside.

7. Considerations, facts, and reasoning supporting the determination: All facts, considerations and rationale have been covered previously in the findings. Consolidation will allow MVK to efficiently coordinate and execute these crucial MRL construction projects at a reduced acquisition time frame time, will produce increased quality and performance due to the selection of qualified and experienced contractors. Most importantly, consolidation of this requirement will allow the MR&T MRL program to successfully execute the mission of levee construction.

8. Summary: Though these approaches constitute consolidation, they provide the best combination of competitive procedures, timely acquisition, cost efficiency, flexibility in scheduling and issuing work, maximum practicable participation by small business, and quality and capable prime contractors necessary to execute and successfully complete these requirements. Stand-alone construction contracts, were considered but determined to result in higher costs, decreased administrative efficiencies, increased acquisition cycle time, and much higher probability of substantial delays in performance and possible mission failure.

Additionally, it is significantly less burdensome for MVK’s Contracting and Construction Divisions to administer each MATOC rather than numerous stand-alone construction contracts.

While there are some cost benefits associated with these consolidations, substantial benefits are realized in these acquisitions in the higher likelihood of mission completion, reduction in acquisition cycle times, and quality improvements that will enhance performance or efficiency, as outlined in FAR 7.107-2(c). The total estimated savings identified due to consolidation is approximately 1.12M in combined estimated costs over the life of each $99.5M contract.

Although these savings do not meet the required threshold to qualify as substantial benefits, there are independent qualitative benefits that are substantial, critical to the agency’s mission success, and provide participation to small business to the maximum extent practicable. The decreased PALT from 90 to 45 days is critical to the agency’s mission success in allowing timely responses to mission critical work during appropriate river stages since the agency can only estimate river stages 60 days in advance and could miss critical windows for project execution if a lesser degree of consolidation was provided. These substantial qualitative benefits justify the chosen approach. The findings of the documentation provided herein support the conclusion that consolidation of requirements is both necessary and justified, based on sound business judgment in view of the size, complexity and number of efforts to be executed. The consolidated approaches provide advantages that substantially exceed the benefits of an approach that provides a lesser degree of consolidation.