A28 Consolidation memo - Redacted v3.pdf

Determination that Consolidation is Necessary and Justified

This determination is made in accordance with (IAW) Federal Acquisition Regulation (FAR) 7.107-2(a) and 15 U.S.C 657q. This determination details the research and analysis performed in order to justify that consolidation is appropriate, necessary and justified, and in the best interest of the Government.

A. Background Solicitation number: HS002125RE003

Requirement: Financial Management Operations Estimated Value (including option):

Defense Counterintelligence and Security Agency (DCSA) requires services for operational support across all Office of the Chief Financial Officer (OCFO) divisions, to include Financial Management Systems and Data, Accounting, Budget Execution, Financial Operations and Chief Financial Officer (CFO) Act Compliance divisions. Soon after the current Financial Management (FM) operational contract, HS002123F0002, was awarded it was clear that the scope of work for the FM operational work would be significantly more than originally anticipated. During the base year a scope increase modification was approved that increased the annual value of the contract. The awarded value of the base year was and the increase to option year 1 was and in the base year. The base year increase is significantly lower than the option year 1 because there was only two months of performance left for the base year. The program office had additional work they wanted the operational contract to complete, but the contracting officer (KO) determined that the contract could not be increased beyond a 30% increase annually. Some of this additional needed work that was not added to HS002123F0002 was the DAI helpdesk support. So as a way to cover some of the unanticipated work under this contract a secondary contract, HS002123F0075, was awarded that provides similar FM operational support, specifically the DAI helpdesk support. The combined annual values of these two contracts does not add up to the anticipated value for the new FM operational support contract, the scope has increased significantly for both requirements after award of each. The scope of this new contract is anticipated to be more stable going forward now that the requirements are better defined. The anticipated value for the base year of the new operational contract is , or for the full five years of performance.

The requirements for this acquisition are enduring and have been met with the previous contracts administered by DCSA as outlined in the following chart:

Contract No. Contractor

Name Business Designation

Description Period of Performance

Contract Value

Alternative Contracting Approaches - FAR 7.107-2(a)(2)

The known alternative to a single contract covering this requirement is:

(1) To split the requirement and make multiple awards

As stated above, the previous contracts were awarded separately due to emerging program needs. After careful analysis, the scope of HS002123F0075 and HS002123F0002 align, and the decision has been made to consolidate under a single contract. Without the consolidation, the Government will encounter additional risk as it relates to duplication of effort to include schedule risks, procurement lead times, and overarching scope creep between both contracts.

The need to separate the actions is no longer necessary and is not advantageous to the Government. More specifically, to split the requirement and make multiple awards has high schedule risks as this would at least double acquisition documentation and reviews and require duplicate pre- and post-award administration for CPO and OCFO. Furthermore, administering multiple contracts for similar services would impose a heavy burden upon the Government, and is no longer necessary now that the FM operations requirement has matured and is more stable. Additionally, the program office anticipates fewer FTEs will be needed if this contract is consolidated since workload can be better streamlined and less oversight required from the contractor. It is anticipated that could be saved per year if these contracts are consolidated.

There are limited benefits to splitting the requirement as it currently is set up. There would be two awards to two small businesses, but the inefficiencies and duplicative efforts make this option less desirable than consolidation.

C. Negative Impact on Small Business - FAR 7.107-2(a)(4)

The existing contracts, HS002123F0002 and HS002123F0075, were awarded to small businesses, and the acquisition strategy remains a small business set-aside, which will impose little impact to small business.

The North American Industry Classification System (NAICS) for this requirement is 541611, Administration Management and General Management Consulting Services, with a small business size-standard of $24.5M (size standard effective as of 17 March 2023). The NAICS for HS002123F0002, HS002123F0075, and this recompete effort are all 541611.

While there will be one less small business who is awarded a DCSA contract with this consolidation. However, the overall value of dollars awarded to a small business would be similar if the contracts were awarded separately. There could be some small businesses who do not bid on this consolidated contract based on the increased size and scope of the new contract.

However, many small businesses who were solicited for HS002123F0075 will be eligible to bid for this new consolidated contract, since we will be using the GSA MAS 541611.

D. Small Business Inclusion in Procurement - FAR 7.107-2(a)(5)

This consolidated requirement will be solicited to GSA MAS contract 541611 and set aside for small business. Throughout the acquisition planning process, potential small business industry partners have been sought out with request for information submitted to GSA OASIS. As stated above, responses to the OASIS RFI will be eligible to bid under the GSA MAS.

E. Benefits of Consolidation - FAR 7.107-2(b) and (c)

To determine that consolidation is necessary and justified, you must demonstrate that the benefits of the acquisition would substantially exceed the benefits that would be derived from each of the alternative contracting approaches identified in Section C above.

Quality improvements that will save time or improve or enhance performance or efficiency - FAR 7.107- 2(c)(1)

As stated above, the previous contracts were awarded as a solution to the growing requirement within FM operations. By consolidating this requirement into a single small business set-aside contract, efficiency and performance are enhanced as all FM operations will be under a single contract. The Government will benefit from a decrease to the burdensome requirement of performing post-award contract administration under two separate contracts and will be better able to align contract performance efficiencies. Moreover, a single contract will boost efficiency of managing delivery of services and will also simplify delivery of deliverables versus multiple Contracting Officers (KO) and Contracting Officer's Representatives (COR) attempting to manage timely delivery of deliverables across separate contracts with different vendors.

Reduction in acquisition cycle times - FAR 7.107-2(c)(2)

The acquisition cycle time from package receipt to award will be lessened as the sum of document creation and review will be cut in half, more specifically from two contract actions to one. Within the single award solution, the Government intends to award a single vehicle with a one-year base period, four one-year option periods, and the potential for a six-month extension, thereby reducing the number of known contract actions required from two contract vehicles to one.

Better terms and conditions - FAR 7.107-2(c)(3)

A single new award eliminates the potential for inconsistencies or conflicts in the terms, conditions, and requirements descriptions, which may occur across multiple efforts. In addition, a combined management approach will ensure consistency in the support required to meet the defined requirements. Additionally, a single contract will assist the Government in ensuring compliance with a single set of terms and conditions rather than with two separate contract awards. This single contract will better align the OCFO mission at DCSA to ensure OCFO has the required support.

Other benefit(s) - FAR 7.107-2(c)(4):

In addition to the benefits listed above, a single award solution will provide for a single team including KO, Contract Specialist (CS) and COR. The Government expects this will significantly lessen any required learning curve associated with new or different persons operating individual contracts. With a single KO, CS and COR, the Government expects streamlined and consistent contract performance reporting as well as a single contract file to review during the performance of the contract.

One potential drawback of consolidating these contracts is the increased scope of the contract could make it more difficult to manage for the contractor. However, we believe this potential risk is outweighed by the cost savings and reduction in Government oversight to make this consolidation beneficial for the Government.

Quantifiable benefits FAR 7.107(d)(1):

Beyond the reduction in time saved for appointing two CORs and managing two separate contracts for similar work. We estimate to fully staff the DAI helpdesk as a standalone contract it is estimated to require full time equivalents (FTEs), but if this work was consolidated under a single contract the DAI helpdesk could be accomplished with FTEs. Based on this alone consolidating these two contracts would save the Government annually, or over the five-year life of the contract. These efficiencies are gained by streamlining workload and eliminating a duplication of efforts between contracts.

Overall Consolidation Costs and Benefits Determination FAR 7.107-2(b)

As stated above these requirements were never intended to be awarded separately, but only as a temporary solution to the emerging FM requirements. Soliciting and awarding separate contracts creates inefficiencies both from the Government side and from the contractor side.

A drawback of consolidation would be the potential impact to some small businesses who may not bid based on the size of this requirement. However, many of the small businesses who were solicited for HS002123F0075 will be solicited and have an opportunity to bid if they choose to. Beyond that, there are considerable quantifiable benefits to consolidation as well as non-quantifiable benefits like reduced acquisition cycle times, reduced oversight required by the Government, and increased efficiencies since we are working with one contractor rather than two.

Overall, the benefits of consolidating these contracts substantially exceeds the benefits from keeping them as separate contracts.

Benefits that are not quantifiable in dollar amounts FAR 7.107-2(d)

There are multiple nonmonetary benefits that could be realized from consolidation. First, reduced acquisition timelines, second a single KO, CS, and COR being able to manage a single contract, and third increased efficiency from a single contractor performing this work rather than two contractors under two separate contracts. All of these benefits have been fully identified in previous sections. No other nonmonetary benefits have been identified.

F. Basis for Consolidation Determination:

This determination that consolidation is necessary and justified is based on:

Benefits of consolidation that are not quantifiable in dollar amounts – FAR 7.107- 2(d)(2)

G. Benefits that are quantifiable in dollar amounts - FAR 7.107-2(d)

FAR 7.107-2(d)(2) states the following:

(2) Benefits that are not quantifiable in dollar amounts shall be specifically identified and otherwise quantified to the extent feasible.

The specific benefits for this consolidation have been fully outlined in the above sections.

I. Mission criticality - FAR 7.107-2(e)

Not Applicable

Determination Based on the above facts, I determine that in accordance with FAR 7.107.2

1. The necessary steps have been taken to support the need for consolidation;

2. This determination has been coordinated with the Agency’s Office of Small Business

Programs; and

3. Consolidation for the above referenced requirement is necessary and justified.

Contracting Officer Contracting and Procurement Office

Concurrence

Office of Small Business Programs

Approved:

Head of the Contracting Activity